UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549










FORM 10-K/A

(Amendment No. 1)



| | x | ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ------------------------------------------------------------------------------------



For the fiscal year ended December 31, 2016



OR



| |  ̈ | TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
| | - | ----------------------------------------------------------------------------------------



Commission File No. 001-37854



Ekso Bionics Holdings, Inc.

(Exact name of registrant as specified in its
charter)



|Nevada                                                        | 99-0367049                         
|------------------------------------------------------------- | -----------------------------------
|(State or Other Jurisdiction ofIncorporation or organization) | (I.R.S. EmployerIdentification No.)



1414 Harbour Way South, Suite 1201

Richmond, California 94804

(Address of Principal Executive Offices) (Zip
Code)



Registrants’ telephone number, including area
code: (510) 984-1761



Securities registered pursuant to section 12(b)
of the Act:



|Title of each class            | Name of each exchange on which registered
|------------------------------ | -----------------------------------------
|Common Stock, $0.001 par value | Nasdaq Stock Market LLC                  
|                               | (Nasdaq Capital Market)                  



Securities registered pursuant to section 12(g)
of the Act: None










Indicate by check mark
if the Registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.  Yes  ̈
 No x



Indicate by check mark
if the Registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.  Yes  ̈
No x



Indicate by check mark
whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports) and (2)
has been subject to such filing requirements for the past 90 days. Yes  x  No  ̈



Indicate by check mark
whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required
to be submitted and posted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months
(or for such shorter period that the registrant was required to submit and post such files). Yes x 
No  ̈



Indicate by check mark
if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to
the best of the registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III
of this Form 10-K or any amendment to this Form 10-K. x



Indicate by check mark
whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company.
See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company”
in Rule 12b-2 of the Exchange Act.



|Large accelerated filer  ̈ | Accelerated filer  x | Non-accelerated filer  ̈ | Smaller Reporting Company  ̈
|------------------------- | -------------------- | ----------------------- | ---------------------------



Emerging growth
company x



If an emerging growth company, indicate by check mark if the registrant has elected not to use the
extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section
13(a) of the Exchange Act x



Indicate by check mark
whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).   Yes  ̈No x



The
aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was $58,706,755 based on the last
sale price for such stock on June 30, 2016, the last business day of the registrant’s most recently completed second fiscal quarter.



As
of March 1, 2017 the registrant had 21,902,212 outstanding shares of common stock.



DOCUMENTS INCORPORATED BY REFERENCE:

Portions of the registrant’s Proxy Statement
for the 2017 Annual Meeting of Stockholders are incorporated herein by reference in Part III of this Annual Report on Form 10-K
to the extent stated herein. Such proxy statement will be filed with the Securities and Exchange Commission within 120 days of
the registrant’s fiscal year ended December 31, 2016.


















Ekso Bionics Holdings, Inc.

ANNUAL REPORT ON FORM 10-K

For the Year Ended December 31, 2016



Table of Contents



|Explanatory Note | 3                                                               
|---------------- | ----------------------------------------------------------------
|                 | Part I                                                          
|Item 1A          | Risk Factors                                                    
|                 |                                                                 
|                 | Part II                                                         
|Item 8           | Financial Statements and Supplementary Data                     
|Item 9A          | Controls and Procedures                                         
|                 |                                                                 
|                 | Part IV                                                         
|Item 15          | Exhibits, Financial Statements and Financial Statement Schedules
|                 | Signatures                                                      



2







Explanatory
Note



As previously disclosed in Item 8.01 of our
Current Report on Form 8-K filed on December 14, 2017, our independent registered public accounting firm, OUM & Co. LLP (“OUM”)
notified management and the Audit Committee of Ekso Bionics Holdings, Inc. (the “Company”) that it had concluded that
its report on the effectiveness of the Company’s internal control over financial reporting as of December 31, 2016 should
no longer be relied upon and that a material weakness in the Company’s internal control over financial reporting existed
as of such date.



We note that no restatement of the Company’s
consolidated financial statements or footnote disclosures for any periods through and including the fiscal year ended December
31, 2016 has occurred.



As part of its original
audit of the Company’s financial statements included in the Company’s Annual Report on Form 10-K for the fiscal year
ended December 31, 2016 (the “Original Filing”), OUM assessed the Company’s internal control over financial reporting
as of December 31, 2016. At that time, OUM and the Company concluded that the Company maintained effective internal control over
financial reporting as of December 31, 2016.



Subsequent to the
issuance of the Original Filing, the Public Company Accounting Oversight Board conducted an inspection of OUM’s 2016 audit
of the Company. As a result, OUM reevaluated the Company’s information technology (IT) general controls, and has now concluded
that a “material weakness” existed as of December 31, 2016.



After consultation with OUM, management also
concluded that the Company’s internal control over financial reporting was not effective at December 31, 2016 and, accordingly,
its disclosure controls and procedures were not effective at December 31, 2016.



This Amendment No. 1 on Form 10-K/A (this “Amendment
No. 1”) amends the Original Filing for the sole purpose of (i) revising the Report of Independent Registered Public Accounting
Firm of OUM (the “Auditor’s ICFR Report”) contained in Part II, Item 8 of the Original Filing regarding the effectiveness
of our internal control over financial reporting and amending the Report of Independent Registered Public Accounting Firm of OUM
contained in Part II, Item 8 of the Original Filing regarding our financial statements to reflect such revision of the Auditor’s
ICFR Report, (ii) revising the disclosure on the effectiveness of our disclosure controls and procedures and the disclosure on
our internal control over financial reporting in Part II, Item 9A of the Original Filing to reflect management’s conclusion
that our internal control over financial reporting and disclosure controls and procedures were not effective at December 31, 2016,
and (iii) revising Part I, Item 1A. Risk Factors of the Original Filing to reflect the material weakness in the Company’s internal
control over financial reporting identified subsequent to the Original Filing.



Pursuant to Rule 12b-15 promulgated under the
Securities Exchange Act of 1934, as amended, we have included the entire text of Part I, Item 1A and Part II, Item 8 of the Original
Filing in this Amendment No. 1. However, there have been no changes to the text of Part I, Item IA other than changes to the risk
factor under the heading “Any failure to maintain effective internal control over our financial reporting could materially
adversely affect us” to reflect the changes noted above, and there have been no changes to the text of Part II, Item
8 other than the change stated in the immediately preceding paragraph. Furthermore, there have been no changes to the XBRL data
filed in Exhibit 101 of the Original Filing. Other than as described above and the inclusion with this Amendment No. 1 of new certifications
by management, a new consent of OUM & Co. LLP, and related amendments to the List of Exhibits contained in Part IV, Item 15
of the Original Filing, this Amendment No. 1 speaks only as of the date of the Original Filing and does not amend, supplement or
update any information contained in the Original Filing to give effect to any subsequent events. Accordingly, this Amendment No.
1 should be read in conjunction with the Original Filing and our reports filed with the U.S. Securities and Exchange Commission
(“SEC”) subsequent to the Original Filing.

3







PART I



Item 1A.    RISK
FACTORS



An investment in our securities is highly
speculative and involves a high degree of risk.  We face a variety of risks that may affect our operations or financial
results and many of those risks are driven by factors that we cannot control or predict.  Before investing in our securities
you should carefully consider the following risks, together with the financial and other information contained in this prospectus.  If
any of the following risks actually occurs, our business, prospects, financial condition and results of operations could be materially
adversely affected.  In that case, the trading price of our common stock would likely decline and investors may lose
all or a part of their investment.



This report contains certain statements
relating to future events or the future financial performance of our Company. Readers are cautioned that such statements are only
predictions and involve risks and uncertainties, and that actual events or results may differ materially. In evaluating such statements,
readers should specifically consider the various factors identified in this report, including the matters set forth below, which
could cause actual results to differ materially from those indicated by such forward-looking statements.



The risks described below do not purport to
be all the risks to which the Company could be exposed. This section is a summary of certain risks and is not set out in any particular
order of priority. They are the risks that we presently believe are material to the operations of the Company. Additional risks
of which we are not presently aware or which we presently deem immaterial may also impair the Company’s business, financial
condition or results of operations.



Risks Related to our Business and the Industry
in Which We Operate



We have a limited operating history upon
which investors can evaluate our future prospects.



Although we were incorporated in 2005, we did
not sell our first Ekso medical device until 2012. Therefore, we have limited operating history upon which an evaluation of our
business plan or performance and prospects can be made. Our business and prospects must be considered in light of the potential
problems, delays, uncertainties and complications encountered in connection with a newly established business and creating a new
industry. The risks include, but are not limited to, the possibility that we will not be able to develop functional and scalable
products and services, or that although functional and scalable, our products and services will not be economical to market; that
our competitors hold proprietary rights that preclude us from marketing such products; that our competitors market a superior or
equivalent product; that we are not able to upgrade and enhance our technologies and products to accommodate new features and expanded
service offerings; or that we fail to receive necessary regulatory clearances for our products. To successfully introduce and market
our products at a profit, we must establish brand name recognition and competitive advantages for our products. There are no assurances
that we can successfully address these challenges. If we are unsuccessful, we and our business, financial condition and operating
results could be materially and adversely affected.



Given the limited operating history, management
has little basis on which to forecast future demand for our products from our existing customer base, much less new customers.
Our current and future expense levels are based largely on estimates of planned operations and future revenues rather than experience.
It is difficult to accurately forecast future revenues because our business is new and our market has not been developed. If our
forecasts prove incorrect, our business, operating results and financial condition will be materially and adversely affected. Moreover,
we may be unable to adjust our spending in a timely manner to compensate for any unanticipated reduction in revenue. As a result,
any significant reduction in revenues would immediately and adversely affect our business, financial condition and operating results.



The industries in which we operate are
highly competitive and subject to rapid technological change. If our competitors are better able to develop and market products
that are safer, more effective, less costly, easier to use, or are otherwise more attractive, we may be unable to compete effectively
with other companies.



The medical technology and industrial robotics
industries are characterized by intense competition and rapid technological change, and we will face competition on the basis of
product features, clinical outcomes, price, services and other factors. Competitors may include large medical device and other
companies, some of which have significantly greater financial and marketing resources than we do, and firms that are more specialized
than we are with respect to particular markets. Our competition may respond more quickly to new or emerging technologies, undertake
more extensive marketing campaigns, have greater financial, marketing and other resources than we do or may be more successful
in attracting potential customers, employees and strategic partners.



4







Our competitive position will depend on multiple,
complex factors, including our ability to achieve market acceptance for our products, develop new products, implement production
and marketing plans, secure regulatory approvals for products under development and protect our intellectual property. Competitors
may offer, or may attempt to develop, more efficacious, safer, cheaper, or more convenient alternatives to our products, including
alternatives that could make the need for robotic exoskeletons obsolete. The development of new or improved products, processes
or technologies by other companies may render our products or proposed products obsolete or less competitive. The entry into the
market of manufacturers located in low-cost manufacturing locations may also create pricing pressure, particularly in developing
markets. Our future success depends, among other things, upon our ability to compete effectively against current technology, as
well as to respond effectively to technological advances, and upon our ability to successfully implement our marketing strategies
and execute our research and development plan.



Our products or exoskeletons generally
may not be accepted in the market.



We cannot be certain that our current products
or any other products we may develop or market will achieve or maintain market acceptance. Market acceptance of our products depends
on many factors, including our ability to convince key opinion leaders to provide recommendations regarding our products, convince
distributors and customers that our technology is an attractive alternative to other technologies, convince health insurers and
other third party payers to cover and provide adequate payments for any products that are used for medical or therapy purposes,
demonstrate that our products are reliable and supported by us in the field, supply and service sufficient quantities of products
directly or through marketing alliances, and price products competitively in light of the current macroeconomic environment, which,
particularly in the case of the medical device industry, is becoming increasingly price sensitive.



In addition, the market for medical and industrial
exoskeletons is new and unproven. We cannot be certain that the market for robotic exoskeletons will continue to develop, or that
robotic exoskeletons for medical or industrial use will achieve market acceptance. If the exoskeleton market fails to develop,
or develops more slowly than we anticipate, we and our business, financial condition and operating results could be materially
and adversely affected.



Dependence on patent and other proprietary
rights and failing to attain, defend or maintain such rights or to be successful in litigation related to such rights may result
in our payment of significant monetary damages or adversely impact our product offerings.



Our long-term success largely depends on our
ability to market technologically competitive products. Failure to protect or to obtain, maintain or extend adequate patent and
other intellectual property rights could materially adversely impact our competitive advantage and impair our business. Our issued
patents may not be sufficient to protect our intellectual property and our patent applications may not result in issued patents.
Even if our patent applications issue as patents, they may not issue in a form that will provide us with any meaningful protection,
prevent competitors from competing with us or otherwise provide us with any competitive advantage. Our competitors may be able
to circumvent our patents by developing similar or alternative technologies or products in a non-infringing manner or may challenge
the validity of our patents. Our attempts to prevent third parties from circumventing our intellectual property and other rights
ultimately may be unsuccessful. We may also fail to take the required actions or pay the necessary fees to maintain any of our
patents that issue.



Furthermore, we have not filed applications
for all of our patents internationally and may not be able to prevent third parties from using our proprietary technologies or
may lose access to technologies critical to our products in other countries. These include, in some cases, countries in which we
are currently selling products and countries in which we intend to sell products in the future.



5







Intellectual property litigation and
infringement claims could cause us to incur significant expenses or prevent us from selling certain of our products.



The industries in which we operate, including,
in particular, the medical device industry, are characterized by extensive intellectual property litigation and, from time to time,
we might be the subject of claims by third parties of potential infringement or misappropriation. Regardless of outcome, such claims
are expensive to defend and divert the time and effort of our management and operating personnel from other business issues. A
successful claim or claims of patent or other intellectual property infringement against us could result in our payment of significant
monetary damages and/or royalty payments or negatively impact our ability to sell current or future products in the affected category
and could have a material adverse effect on our business, cash flows, financial condition or results of operations.



Some of the patents in the intellectual
property portfolio are not within our complete control, which could reduce the value of such patents.



Some of our U.S. patent applications (which
have associated international applications) are co-owned by the Regents of the University of California Berkeley. The Regents of
the University of California Berkeley has licensed its rights under many of these patent applications to us, but we do not have
a license to their rights under three of these patent applications. With respect to two of these co-owned patent applications,
the Regents of the University of California Berkeley have licensed their rights in the U.S. to an unrelated third party. The third
patent application will need to be fully prosecuted before it can be determined which claims are exclusive to us (through a previous
license) and which claims the Regents of the University of California Berkeley may license to other entities. In addition, in connection
with our acquisition of certain assets from Equipois, we assumed the rights and obligations of Equipois with respect to certain
patents and patent applications under an in-license of intellectual property from a third party and subject to an out-license of
that intellectual property to an unrelated third party for use in a particular field. We do not have complete control over the
prosecution of these patent applications. In addition, the license of patent rights under these patents to third parties could
reduce the value of our patent portfolio and limit any income or license fees that we might receive if we were to attempt to transfer
or license our rights under any of our co-owned or licensed patents.



If we fail to obtain or maintain necessary
regulatory clearances or approvals for our medical device products, or if clearances or approvals for future products or modifications
to existing products are delayed or not issued, our commercial operations would be harmed.



The Ekso GT is a medical device that is subject
to extensive regulation by the FDA, the European Union and other governmental authorities both inside and outside of the United
States. These agencies enforce laws and regulations that govern the development, testing, manufacturing, labeling, advertising,
marketing and distribution, and market surveillance of our medical products. Our failure to comply with these complex laws and
regulations could have a material adverse effect on our business, results of operations, financial condition and cash flows.



In the United States, before we can market
a new medical device, or a new use of, new claim for or significant modification to an existing product, we must first receive
either clearance under Section 510(k) of the FDCA or approval of a premarket approval, or PMA, application from the FDA, unless
an exemption applies. Both the PMA approval and the 510(k) clearance process can be expensive, lengthy and uncertain. The FDA’s
510(k) clearance process may take anywhere from several months to over a year. The process of obtaining a PMA is much more costly
and uncertain than the 510(k) clearance process and generally takes from one to three years, or even longer, from the time the
application is filed with the FDA. In addition, PMA generally requires the performance of one or more clinical trials.



The FDA also has substantial discretion in
the medical device review process. Despite the time, effort and cost, we cannot assure you that any particular device will be approved
or cleared by the FDA. Any delay or failure to obtain necessary regulatory approvals could harm our business. Failure can occur
at any stage, and we could encounter problems that cause us to repeat or perform additional development, standardized testing,
pre-clinical studies and clinical trials. Any delay or failure to obtain necessary regulatory approvals could harm or business.



6







The FDA or other non-U.S. regulatory authorities
can delay, limit or deny clearance or approval of a medical device candidate for many reasons, including:



| | · | a medical device candidate may not be deemed to be substantially equivalent to a device lawfully marketed either as a grandfathered device or one that was cleared through the 510(k) premarket notification process;
| | - | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | a medical device candidate may not be deemed to be in conformance with applicable standards and regulations;
| | - | ------------------------------------------------------------------------------------------------------------



| | · | FDA or other regulatory officials may not find the data from pre-clinical studies and clinical trials or other product testing date to be sufficient;
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------



| | · | other non-U.S. regulatory authorities may not approve our processes or facilities or those of any of our third-party manufacturers, thereby restricting export; or
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | the FDA or other non-U.S. regulatory authorities may change clearance or approval policies or adopt new regulations.
| | - | --------------------------------------------------------------------------------------------------------------------



Even after regulatory clearance or approval
has been granted, a cleared or approved product and its manufacturer are subject to extensive regulatory requirements relating
to manufacturing, labeling, packaging, adverse event reporting, storage, advertising and promotion for the product. If we fail
to comply with the regulatory requirements of the FDA or other non-U.S. regulatory authorities, or if previously unknown problems
with our products or manufacturing processes are discovered, we could be subject to administrative or judicially imposed sanctions,
including:



| | · | restrictions on the products, manufacturers or manufacturing process;
| | - | ---------------------------------------------------------------------



| | · | adverse inspectional observations (Form 483), warning letters, non-warning letters incorporating inspectional observations;
| | - | ---------------------------------------------------------------------------------------------------------------------------



| | · | civil or criminal penalties or fines;
| | - | -------------------------------------



| | · | injunctions;
| | - | ------------



| | · | product seizures, detentions or import bans;
| | - | --------------------------------------------



| | · | voluntary or mandatory product recalls and publicity requirements;
| | - | ------------------------------------------------------------------



| | · | suspension or withdrawal of regulatory clearances or approvals;
| | - | ---------------------------------------------------------------



| | · | total or partial suspension of production;
| | - | ------------------------------------------



| | · | imposition of restrictions on operations, including costly new manufacturing requirements;
| | - | ------------------------------------------------------------------------------------------



| | · | refusal to clear or approve pending applications or premarket notifications; and
| | - | --------------------------------------------------------------------------------



| | · | import and export restrictions.
| | - | -------------------------------



If imposed on us, any of these sanctions could
have a material adverse effect on our reputation, business, results of operations and financial condition.



Modifications to our Ekso GT and our
future products may require new 510(k) clearances or PMA approvals, or may require us to cease marketing or recall the modified
products until clearances are obtained



On April 4, 2016, the Company received clearance
from the FDA to market its Ekso GT robotic exoskeleton for use in the treatment of individuals with hemiplegia due to stroke, individuals
with spinal cord injuries at levels T4 to L5, and individuals with spinal cord injuries at levels of T3 to C7 (ASIA D), in accordance
with the device’s labeling. On July 19, 2016, the Company received clearance from the FDA to expand/clarify the indications
and labeling to expressly include individuals with hemiplegia due to stroke who have upper extremity function of at least 4/5 in
only one arm. The Company’s prior cleared indications for use statement required that individuals with hemiplegia due to
stroke have upper extremity function of at least 4/5 in both arms.



7







An element of our strategy is to continue to
upgrade the Ekso GT to incorporate new software and hardware enhancements. Any modification to a 510(k)-cleared device, including
our Ekso GT, that could significantly affect its safety or effectiveness, or that would constitute a major change in its intended
use, design, or manufacture, requires a new 510(k) clearance or, possibly, a PMA. The FDA requires every manufacturer to make this
determination in the first instance, but the FDA may review such determinations. The FDA may not agree with our decisions regarding
whether new clearances or approvals are necessary. If the FDA disagrees with our determinations for any future changes, or prior
changes to previously marketed products, as the case may be, we may be required to cease marketing or to recall the modified products
until we obtain clearance or approval, and we may be subject to significant regulatory fines or penalties.



Furthermore, the FDA’s ongoing review
of its 510(k) program may make it more difficult for us to make modifications to our products, either by imposing more strict requirements
on when a new 510(k) for a modification to a previously cleared product must be submitted, or applying more onerous review criteria
to such submissions. In July and December 2011, respectively, the FDA issued draft guidance documents addressing when to submit
a new 510(k) due to modifications to 510(k) cleared products and the criteria for evaluating substantial equivalence. The July
2011 draft guidance document was ultimately withdrawn, and as a result, the FDA’s original guidance document regarding 510(k)
modifications, which dates back to 1997, remains in place. It is uncertain when the FDA will seek to issue new guidance on product
modifications. Any efforts to do so could result in a more rigorous review process and make it more difficult to obtain clearance
for device modifications.



The manufacture of our products is subject
to extensive post-market regulation by the FDA. Our failure to meet strict regulatory requirements could require us to pay fines,
incur other costs or even close our facilities.



We are required to comply with the FDA’s
Quality System Regulation, or QSR, which is a complex regulatory scheme that covers the procedures and documentation of the design,
testing, production, process controls, quality assurance, labeling, packaging, handling, storage, distribution, installation, servicing
and shipping of our marketed products. These regulatory requirements may significantly increase our production costs and may even
prevent us from making our products in amounts sufficient to meet market demand. If we change our approved manufacturing process,
the FDA may need to review the process before it may be used. The FDA enforces the QSR through periodic announced and unannounced
inspections of manufacturing facilities. Failure to comply with regulatory requirements such as QSR may result in changes to labeling,
restrictions on such products or manufacturing processes, withdrawal of the products from the market, voluntary or mandatory recalls,
a requirement to repair, replace or refund the cost of any medical device we manufacture or distribute, fines, suspension of regulatory
approvals, product seizures, injunctions or the imposition of civil or criminal penalties which would adversely affect our business,
operating results and prospects.



Federal, state and non-U.S. regulations regarding
the manufacture and sale of medical devices are subject to future changes. The complexity, timeframes and costs associated with
obtaining marketing clearances are unknown. Although we cannot predict the impact, if any, these changes might have on our business,
the impact could be material.



We may be subject to fines, penalties
or injunctions if we are determined to be promoting the use of our products for unapproved or “off-label” uses.



Any cleared or approved product may be promoted
only for its indicated uses and our promotional materials must comply with FDA and other applicable laws and regulations. We believe
that the specific use for which our products are marketed fall within the scope of the indications for use that have been cleared
by the FDA. However, if the FDA determines that our promotional materials or training constitutes promotion of an unapproved use,
it could request that we modify our promotional materials or subject us to regulatory or enforcement actions, including the issuance
of an untitled letter, a warning letter, injunction, seizure, civil fine and criminal penalties. It is also possible that other
federal, state or foreign enforcement authorities might take action if they consider our promotional or training materials to constitute
promotion of an unapproved use, which could result in significant fines or penalties under other statutory authorities, such as
laws prohibiting false claims for reimbursement. In that event, our reputation could be damaged and adoption of the products would
be impaired.



8









Failure to comply with anti-kickback
and fraud regulations could result in substantial penalties and changes in our business operations.



Although we do not provide healthcare services,
submit claims for third-party reimbursement, or receive payments directly from Medicare, Medicaid or other third-party payers for
our products, we are subject to healthcare fraud and abuse regulation and enforcement by federal, state and foreign governments,
which could significantly impact our business. The principal U.S. federal laws implicated include those that prohibit (i) the filing
of false or improper claims for federal payment, known as the false claims laws, (ii) unlawful inducements for the referral of
business reimbursable under federally-funded health care programs, known as the anti-kickback laws, and (iii) health care service
providers from seeking reimbursement for providing certain services to a patient who was referred by a physician who has certain
types of direct or indirect financial relationships with the service provider, known as the Stark law. Many states have similar
laws that apply to reimbursement by state Medicaid and other funded programs as well as in some cases to all payers.



If our operations are found to be in violation
of any of the laws described above or any other governmental regulations that apply to us now or in the future, we may be subject
to penalties, including civil and criminal penalties, damages, fines, disgorgement, exclusion from governmental health care programs,
and the curtailment or restructuring of our operations, any of which could adversely affect our ability to operate our business
and our financial results.



U.S. legislative or FDA regulatory reforms
may make it more difficult and costly for us to obtain regulatory approval of our product candidates and to manufacture market
and distribute our products after approval is obtained.



From time to time, legislation is drafted and
introduced in Congress that could significantly change the statutory provisions governing the regulatory approval, manufacture
and marketing of regulated devices. In addition, FDA regulations and guidance are often revised or reinterpreted by the FDA in
ways that may significantly affect our business and our products. Any new regulations or revisions or reinterpretations of existing
regulations may impose additional costs or lengthen review times of future products. In addition, FDA regulations and guidance
are often revised or reinterpreted by the agency in ways that may significantly affect our business and our products. It is impossible
to predict whether legislative changes will be enacted or FDA regulations, guidance or interpretations changed, and what the impact
of such changes, if any, may be.



For example, the FDA may change its clearance
and approval policies, adopt additional regulations or revise existing regulations, or take other actions which may prevent or
delay approval or clearance of our products under development or impact our ability to modify cleared products on a timely basis.



Any change in the laws or regulations that
govern the clearance and approval processes relating to our current and future products could make it more difficult and costly
to obtain clearance or approval for new products, or to produce, market, and distribute existing products. Significant delays in
receiving clearance or approval, or the failure to receive clearance or approval, for any new products would have an adverse effect
on our ability to expand our business.



If our medical products, or malfunction
of our medical products, cause or contribute to a death or a serious injury, we will be subject to medical device reporting regulations,
which can result in voluntary corrective actions or agency enforcement actions.



Under the FDA’s medical device reporting,
or MDR, regulations, we are required to report to the FDA any incident in which our product may have caused or contributed to a
death or serious injury or in which our product malfunctioned and, if the malfunction were to recur, would likely cause or contribute
to death or serious injury. For example, we have been informed of a limited number of events with respect to our Ekso GT devices
that have been determined to be reportable pursuant to the MDR regulations. There were no reported patient injuries related to
any of these events, and in each case we have filed the required MDR reports with the FDA.



9







In addition, all manufacturers bringing medical
devices to market in the European Economic Area are legally bound to report any incident that led or might have led to the death
or serious deterioration in the state of health of a patient, user or other person, and which the manufacturer’s device is
suspected to have caused, to the competent authority in whose jurisdiction the incident occurred. In such case, the manufacturer
must file an initial report with the relevant competent authority, which would be followed by further evaluation or investigation
of the incident and a final report indicating whether further action is required. The events described above that were reported
to the FDA were also reported to the relevant EU regulatory authorities.



We are also required to follow detailed recordkeeping
requirements for all Company-initiated medical device corrections and removals, and to report such corrective and removal actions
to the FDA if they are carried out in response to a risk to health and have not otherwise been reported under the MDR regulations.
Any adverse event involving our products could result in future voluntary corrective actions, such as recalls or customer notifications,
or agency action, such as inspection or enforcement action. Recalls of our products, or agency actions relating to our failure
to comply with our reporting or recordkeeping obligations, could harm our reputation and financial results.



Discovery of serious safety issues with
our products, or a recall of our products either voluntarily or at the direction of the FDA or another governmental authority,
could have a negative impact on us.



The FDA and similar foreign governmental authorities
have the authority to require the recall of commercialized products in the event of material deficiencies or defects in design
or manufacture or in the event that a product poses an unacceptable risk to health. In addition, manufacturers may, under their
own initiative, recall a product if any material deficiency in a device is found. A government-mandated or voluntary recall by
us could occur as a result of an unacceptable risk to health, component failures, manufacturing errors, design or labeling defects
or other deficiencies and issues. To date, we have initiated only one field action in which we voluntarily accelerated our maintenance
schedule based on field usage.



When a medical human exoskeleton is used by
a paralyzed individual to walk, the individual relies completely on the exoskeleton to hold them upright. There are many exoskeleton
components that, if they were to fail catastrophically, could cause a fall resulting in severe injury or death of the patient.
Certain of our competitors have reported injuries caused by the malfunction of human exoskeleton devices (in at least one case
to the FDA). Injuries caused by the malfunction or misuse of human exoskeleton devices, even where such malfunction or misuse occurs
with respect to one of our competitor’s products, could cause regulatory agencies to implement more conservative regulations
on the medical human exoskeleton industry, which could significantly increase our operating costs.



Similarly, when an industrial exoskeleton is
used by a healthy individual — for example to operate heavy machinery overhead — malfunction of
the device at an inopportune moment could result in severe injury or death of the person using the device. Such occurrences could
result in regulatory action on the part of OSHA or its foreign counterparts.



Any future recalls of any of our products could
divert managerial and financial resources, impair our ability to manufacture our products in a cost-effective and timely manner,
and have an adverse effect on our reputation, results of operations and financial condition. In some circumstances, such adverse
events could also cause delays in new product approvals. We may also be required to bear other costs or take other actions that
may have a negative impact on our future sales and our ability to generate profits.



In addition, personal injuries relating to
the use of our products could also result in product liability claims being brought against us. Any product liability claim brought
against us, with or without merit, could result in substantial damages, be costly and time-consuming to defend and could increase
our insurance rates or prevent us from securing insurance coverage in the future.



We could be exposed to significant liability
claims if we are unable to obtain insurance at adequate levels or otherwise protect ourselves against potential product liability
claims.



The testing, manufacture, marketing and sale
of medical devices entail the inherent risk of liability claims or product recalls. Although we maintain product liability insurance,
the coverage is subject to deductibles and limitations, and may not be adequate to cover future claims. A successful product liability
claim or product recall could inhibit or prevent the successful commercialization of our products, cause a significant financial
burden on us, or both, which in either case could have a material adverse effect on our business and financial condition.



10







Warranty claims or any other service
and repairs provided by the Company at its expense could have a material adverse effect on our business.



Sales of our Ekso GT generally include a one-year
warranty for parts and services in the U.S. and a two-year warranty in Europe, the Middle East and Africa. We also generally provide
customers with an option to purchase an extended warranty for up to an additional three years. The costs associated with such warranties,
including any warranty-related legal proceedings, could have a material adverse effect on our results of operations, cash flows
and liquidity. As we enhance our product and in an effort to build our brand and drive adoption, the Company has elected to incur
increased service expenses related to an accelerated maintenance program, field corrections and the implementation of technological
improvements developed subsequent to many of our units being placed into service, sometimes outside of its warranty and contractual
obligations. Continuation of these activities could have a material adverse effect on our results of operations, cash flows and
liquidity.



If we are not able to both obtain and
maintain adequate levels of third-party reimbursement for our products, it would have a material adverse effect on our business.



Healthcare providers and related facilities
are generally reimbursed for their services through payment systems managed by various governmental agencies worldwide, private
insurance companies, and managed care organizations. The manner and level of reimbursement in any given case may depend on the
site of care, the procedure(s) performed, the final patient diagnosis, the device(s) utilized, available budget, or a combination
of these factors, and coverage and payment levels are determined at each payer’s discretion. The coverage policies and reimbursement
levels of these third-party payers may impact the decisions of healthcare providers and facilities regarding which medical products
they purchase and the prices they are willing to pay for those products. Reimbursement rates can also affect the acceptance rates
of new technologies.



We have no direct control over payer decision-making
with respect to coverage and payment levels for our medical device products. Additionally, we expect many payers to continue to
explore cost-containment strategies (e.g., comparative and cost-effectiveness analyses, so-called “pay-for-performance”
programs implemented by various public and private payers, and expansion of payment bundling schemes such as Accountable Care Organizations,
and other such methods that shift medical cost risk to providers) that may potentially impact coverage and/or payment levels for
our current products or products we develop.



Legislative or administrative reforms to reimbursement
systems in the United States or abroad, or changes in reimbursement rates by private payers, could significantly reduce reimbursement
for procedures using our products or result in denial of reimbursement for those products, which would adversely affect customer
demand or the price customers may be willing to pay for such products and could result in decrease revenue.



Any additional studies that we are required
or choose to initiate, whether to drive market adoption and support commercialization, or to support additional product submissions
or new claims, will be expensive and time consuming, which could harm our financial results.



Initiating and completing clinical trials necessary
to drive market adoption and support commercialization, or to support additional product submissions or new claims, can be time
consuming and expensive and the outcome uncertain. Moreover, the results of early clinical trials are not necessarily predictive
of future results, and any product we advance into clinical trials may not have favorable results in later clinical trials. Conducting
successful clinical studies requires the enrollment of large numbers of patients, and suitable patients may be difficult to identify
and recruit. Patient enrollment in clinical trials and completion of patient participation and follow-up depends on many factors,
including the size of the patient population, the nature of the trial protocol, the attractiveness of, or the discomforts and risks
associated with, the treatments received by enrolled subjects, the availability of appropriate clinical trial investigators and
support staff, proximity of patients to clinical sites, patient ability to meet the eligibility and exclusion criteria for participation
in the clinical trial and patient compliance.



11







All clinical trial activities that we undertake
are subject to extensive regulation and review by numerous governmental authorities both in the United States and abroad. Clinical
trials intended to support a 510(k) or PMA must be conducted in compliance with the FDA’s Good Clinical Practice regulations
and similar requirements in foreign jurisdictions. Sufficient and appropriate clinical protocols to demonstrate safety and efficacy
may be required and we may not adequately develop such protocols to support future clearances and approvals. Delays in patient
enrollment or failure of patients to continue to participate in a clinical trial may cause an increase in costs and delays in future
clearances or approvals of our products or result in the failure of the clinical trial. Such increased costs and delays or failures
could adversely affect our business, results of operations and prospects.



The results of clinical trials may not
support new product submissions or claims or may result in the discovery of adverse side effects.



Despite considerable time and expense invested
in clinical trials, the FDA may not consider any data that we obtain adequate to demonstrate safety and efficacy for future submissions.
Even if our clinical trials are completed as planned, we cannot be certain that their results will support our intended claims
or demonstrate that our product candidates are safe and effective for the proposed indicated uses, which could cause us to abandon
a product candidate and may delay development of others. Any delay or termination of our clinical trials or studies could delay
the filing of associated product submissions and, ultimately, our ability to commercialize products requiring submission of clinical
data or relying on clinical data for market acceptance.



It is also possible that patients enrolled
in a clinical trial will experience adverse side effects that are not currently part of the product candidate’s safety profile,
which could cause us to delay or abandon development of such product.



Clinical studies regarding our products
may not provide sufficient data to either cause third-party payers to approve reimbursement or to make human exoskeletons a standard
of care.



Our business plan relies on broad adoption
of human exoskeletons to provide neuro-rehabilitation in the form of gait training to individuals who have suffered a neurological
injury or disorder. Although use of human exoskeletons in neuro-rehabilitation is new, use of robotic devices to provide gait training
has been going on for over a decade and the clinical studies relating to such devices have had both positive and negative outcomes.
Much of the rehabilitation community has rejected the use of such devices based on the data from some of these studies. Although
we believe that human exoskeletons will outperform such robotic equipment, this has not been proven. Furthermore, it may prove
impossible to prove an advantage in a timely manner, or at all, which could prevent broad adoption of our products.



Part of our business plan relies on broad adoption
of the Ekso robotic exoskeleton to provide “early mobilization” of individuals who have been immobilized by an injury,
disease, or other condition. Although the health benefits of other methods of “early mobilization” have been demonstrated
in clinical studies in fields such as stroke, those studies did not test early mobilization with human exoskeletons directly. To
date, the Ekso device has been the subject of several clinical trials, some of which have been partially sponsored by us, but most
of which are non-Ekso-sponsored independent studies conducted by rehabilitation institutions. Data from these studies was provided
to the FDA as part of our 510(k) submissions. In addition, there are several ongoing independent studies to investigate additional
indications for use for the Ekso device, as well as to evaluate clinical and non-clinical outcomes of using the Ekso device, and
we are currently in the planning stage for several Company-led studies.



If current and future clinical trials do not
provide sufficient data to support our belief that early mobilization through the use of exoskeletons improves health outcomes,
of such studies actually contradict that belief, market acceptance of the human exoskeletons could fail to increase or could decrease
and our business could be harmed.



We may be unable to attract and retain
key employees.



Our success depends on our ability to identify,
hire, train and retain highly qualified managerial, technical and sales and marketing personnel. In addition, as we introduce new
products or services, we will need to hire additional personnel. Currently, competition for personnel with the required knowledge,
skill and experiences is intense, particularly in the San Francisco Bay area, where we are headquartered, and we may not be able
to attract, assimilate or retain such personnel. The inability to attract and retain the necessary managerial, technical and sales
and marketing personnel could have a material adverse effect on our business, results of operations and financial condition.



12







We will experience long and variable
sales cycles, which could have a negative impact on our results of operations for any given quarter and may result in volatility
in our stock price.



The Ekso GT has a lengthy sale and purchase
order cycle because it is a major capital item and generally requires the approval of senior management at purchasing institutions,
which may contribute to substantial fluctuations in our quarterly operating results. Other factors that may cause our operating
results to fluctuate include:



| | · | general economic uncertainties and political concerns;
| | - | ------------------------------------------------------



| | · | the introduction of new products or product lines;
| | - | --------------------------------------------------



| | · | product modifications;
| | - | ----------------------



| | · | the level of market acceptance of new products;
| | - | -----------------------------------------------



| | · | the timing and amount of research and development and other expenditures;
| | - | -------------------------------------------------------------------------



| | · | timing of the receipt of orders from, and product shipments to, distributors and customers;
| | - | -------------------------------------------------------------------------------------------



| | · | changes in the distribution arrangements for our products;
| | - | ----------------------------------------------------------



| | · | manufacturing or supply delays;
| | - | -------------------------------



| | · | the time needed to educate and train additional sales and manufacturing personnel; and
| | - | --------------------------------------------------------------------------------------



| | · | costs associated with defending our intellectual property.
| | - | ----------------------------------------------------------



In addition to these factors, expenditures
are based, in part, on expected future sales. If sales levels in a particular quarter do not meet expectations, we may be unable
to adjust operating expenses quickly enough to compensate for the shortfall of sales, and our results of operations may be adversely
affected.



International sales of our products account
for a portion of our revenues, which will expose us to certain operating risks. If we are unable to successfully manage our international
activities, our net sales, results of operations and financial condition could be adversely impacted.



Our business currently depends in part on our
activities in Europe and other foreign markets, making it subject to a number of challenges that specifically relate to international
business activities. These include:



| | · | failure of local laws to provide the same degree of protection against infringement of our intellectual property rights;
| | - | ------------------------------------------------------------------------------------------------------------------------



| | · | protectionist laws and business practices that favor local competitors, which could slow our growth in international markets;
| | - | -----------------------------------------------------------------------------------------------------------------------------



| | · | the expense of establishing facilities and operations in new foreign markets;
| | - | -----------------------------------------------------------------------------



| | · | building an organization capable of supporting geographically dispersed operations;
| | - | -----------------------------------------------------------------------------------



| | · | challenges caused by distance, language and cultural differences;
| | - | -----------------------------------------------------------------



| | · | challenges caused by differences in legal regulations, markets, and customer preferences, which may limit our ability to adapt our products or succeed in other regions;
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | multiple, conflicting, and changing laws and regulations, including complications due to unexpected changes in regulatory requirements, foreign laws, tax schemes, international import and export legislation, trading and investment policies, exchange controls and tariff and other trade barriers;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



13







| | · | foreign tax consequences;
| | - | -------------------------



| | · | fluctuations in currency exchange rates and foreign currency translation adjustments;
| | - | -------------------------------------------------------------------------------------



| | · | foreign exchange controls that might prevent us from repatriating income earned outside the United States;
| | - | ----------------------------------------------------------------------------------------------------------



| | · | imposition of public sector controls;          
| | - | -----------------------------------------------
| |   |                                                
| | · | political, economic and social instability; and



| | · | restrictions on the export or import of technology.
| | - | ---------------------------------------------------



If we are unable to meet and overcome these
challenges, then our international operations may not be successful, which could adversely affect our net sales, results of operations
and financial condition and limit our growth.



The disruption or loss of relationships
with vendors and suppliers for the components of our products could materially adversely affect our business.



Our ability to manufacture and market our products
successfully is dependent on relationships with both third party vendors and suppliers. Although most of the raw materials that
we use to manufacture our products are readily available from a number of suppliers, we generally procure raw materials and components
through purchase orders, with no guaranteed supply arrangements. Our inability to obtain sufficient quantities of various components,
if and as required in the future, may subject us to:



| | · | delays in delivery or shortages in components that could interrupt and delay manufacturing and result in cancellations of orders for our products;
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------



| | · | increased component prices and supply delays as we establish alternative suppliers;
| | - | -----------------------------------------------------------------------------------



| | · | inability to develop alternative sources for product components;
| | - | ----------------------------------------------------------------



| | · | required modifications of our products, which may cause delays in product shipments, increased manufacturing costs, and increased product prices; and
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------



| | · | increased inventory costs as we hold more inventory than we otherwise might in order to avoid problems from shortages or discontinuance, which may result in write-offs if we are unable to use all such products in the future.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



In addition, failure of any one supplier’s
components could result in a product recall, which could materially adversely affect our business, operations and cash flows.



We may be unable to manage our growth
and entry into new business areas.



If the initial response to our exoskeleton
products exceeds our capacity to provide services timely and efficiently, then we may need to expand our operations accordingly
and swiftly. Our management believes that establishing industry leadership will require us to:



| | · | test, introduce and develop new products and services including enhancements to our Ekso device;
| | - | ------------------------------------------------------------------------------------------------



| | · | develop and expand the breadth of products and services offered;
| | - | ----------------------------------------------------------------



| | · | develop and expand our market presence through relationships with third parties; and
| | - | ------------------------------------------------------------------------------------



| | · | generate satisfactory revenues from such expanded products or services to fund the foregoing requirements while obtaining and maintaining satisfactory profit margins.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------



14







To be able to expand our operations in a cost-effective
or timely manner and increase the overall market acceptance of our products and services in this manner, we will need additional
capital and technical and managerial human resources. These additional resources may not be available to us. Our failure to timely
and efficiently expand our operations and successfully achieve the four requirements listed above could have a material adverse
effect on our business, results of operations and financial condition.



New product introductions may adversely
impact our financial results.



We may introduce new products with enhanced
features and extended capabilities from time to time. The products may be subject to various regulatory processes, and we may need
to obtain and maintain regulatory approvals in order to sell our new products. If a potential purchaser believes that we plan to
introduce a new product in the near future or if a potential purchaser is located in a country where a new product that we have
introduced has not yet received regulatory approval, planned purchases may be deferred or delayed. As a result, new product introductions
may adversely impact our financial results.



The acquisition of other companies, businesses,
or technologies could result in operating difficulties, dilution, and other harmful consequences.



We may selectively pursue strategic acquisitions,
any of which could be material to our business, operating results, and financial condition. Future acquisitions could divert management’s
time and focus from operating our business. In addition, integrating an acquired company, business or technology is risky and may
result in unforeseen operating difficulties and expenditures associated with integrating employees from the acquired company into
our organization and integrating each company’s accounting, management information, human resources and other administrative
systems to permit effective management. The anticipated benefits of future acquisitions may not materialize. Future acquisitions
or dispositions could result in potentially dilutive issuances of our equity securities, the incurrence of debt, contingent liabilities
or amortization expenses, or write-offs of goodwill, any of which could harm our financial condition. Future acquisitions may also
require us to obtain additional financing, which may not be available on favorable terms or at all.



Healthcare changes in the U.S. and other
countries, including recently enacted legislation reforming the U.S. healthcare system, could have a negative impact on our future
operating results.



In 2010, the Patient Protection and Affordable
Care Act (“ACA”) was enacted into law. The legislation seeks to reform the United States healthcare system. It is far-reaching
and is intended to expand access to health insurance coverage, improve quality and reduce costs over time. We expect the new law
will have a significant impact upon various aspects of our business operations. The ACA reduces Medicare and Medicaid payments
to hospitals, clinical laboratories and pharmaceutical companies, and could otherwise reduce the volume of medical procedures.
These factors, in turn, could result in reduced demand for our products and increased downward pricing pressure. It is also possible
that the ACA will result in lower reimbursements. While the ACA is intended to expand health insurance coverage to uninsured persons
in the United States, the impact of any overall increase in access to healthcare on sales of our products remains uncertain. In
addition, the new law imposes a 2.3 percent excise tax on medical devices that will apply to United States sales of our medical
device product. The new U.S. Presidential administration and the majority party in both Houses of the U.S. Congress have indicated
their desire to repeal the Affordable Care Act. It is unclear whether, when and how that repeal will be effectuated and what the
effect on the healthcare sector will be. The outlook for the healthcare sector is unclear, and we are unable to predict the future
course of federal or state healthcare legislation and regulations. Changes in the law or regulatory framework that reduce our revenues
or increase our costs could also harm our business, financial condition and results of operations and cash flows.



In addition to the ACA, initiatives sponsored
by government agencies, legislative bodies and the private sector to limit the growth of healthcare costs, including price regulation
and competitive pricing, are ongoing in markets where we will do business. Pricing pressure has also increased in these markets
due to continued consolidation among health care providers, trends toward managed care, the shift towards governments becoming
the primary payers of health care expenses and laws and regulations relating to reimbursement and pricing generally. Reductions
in reimbursement levels or coverage or other cost-containment measures could unfavorably affect our future operating results.



15







Natural or other disasters could disrupt
our business and result in loss of revenue or in higher expenses.



Natural disasters, terrorist activities, military
conflict and other business disruptions could seriously harm our revenue and financial condition and increase our costs and expenses.
Our corporate headquarters are located in California, a seismically active region. A natural disaster in any of our major markets
in North America or Europe could have a material adverse impact on our operations, operating results and financial condition. Further,
any unanticipated business disruption caused by Internet security threats, damage to global communication networks or otherwise
could have a material adverse impact on our operating results.



Risks Related to our Financial Condition



We have a history of losses and we may
not achieve or sustain profitability in the future. These factors raise substantial doubt about our ability to continue as a going
concern.



We have incurred losses in each fiscal year
since our incorporation in 2005. Our recurring losses from operations raise substantial doubt about our ability to continue as
a going concern, and as a result our independent registered public accounting firm included an explanatory paragraph regarding
the same in its report to this Annual Report on Form 10-K. Substantial doubt about our ability to continue as a going concern may
create negative reactions to the price of our common stock and we may have a more difficult time obtaining financing in the future.



Our net losses were $23.5 million, $19.6 million,
and $33.8 million for the years ended December 31, 2016, 2015, and 2014, respectively. As of December 31, 2016, we had an accumulated
deficit of $114.9 million.



We anticipate that our operating expenses will
increase in the foreseeable future as we continue to invest to grow our business, acquire customers and develop our platform and
new functionality. These efforts may prove more expensive than we currently anticipate, and we may not succeed in increasing our
revenues sufficiently to offset these higher expenses.



We may not be able to reduce the cost
to manufacture or service our products as planned.



Our business plan assumes that exoskeletons
can be manufactured more inexpensively than they are currently being manufactured. However, we have not yet found a way to significantly
reduce the manufacturing cost of our products and doing so may prove more difficult than expected or even impossible. For example,
if expectations for greater functionality of the products drive costs up as other factors drive costs down, the result may be that
the overall cost of manufacturing the product stays the same or even increases. Likewise, we currently provide service and support
of our products for our customers at a high standard (both in and out of warranty), and plan on continuing to do so. Our business
plan also assumes that as we continue to improve our product, we achieve improved levels of product reliability and decreased service
cost and frequency, which also may prove more difficult than expected.



We may not be able to leverage our cost
structure or achieve better margins.



Due to the early stage of our commercial efforts,
and particularly the early stage of customer adoption of our products, our current sales and marketing, research and development,
and general and administrative expenses are each a higher percentage of sales than they will need to be for us to reach profitability.
While we do expect these expenses to grow as our business grows, we also expect these expenses to decline as a percentage of revenues
over time. If we are unable to leverage these costs and grow revenues at a greater pace than these operating expenses as we expect,
we will not be able to achieve viable operating margins and profitability.



If we are unable to obtain additional
financing on acceptable terms, we may have to curtail our growth or cease our development plans and operations.



The operation of our business and our growth
efforts will require significant cash outlays and advance capital equipment expenditures and commitments.



We have been largely dependent on capital raised
through the sale of equity securities in various public and private offerings, and going forward will be largely dependent on capital
raised in any future offerings, to implement our business plan and support our operations.



16







Based upon the Company’s current cash
resources, the recent rate of using cash for operations and investment, and assuming modest increases in current revenue offset
by incremental increases in expenses related to increased sales and marketing and research and development, and a potential increase
in rental activity from its medical device business, the Company believes it has sufficient resources to meet its financial obligations
into the third quarter of 2017. The Company will require significant additional financing. The Company intends to pursue opportunities
to obtain additional financing in the future through public or private equity and/or debt financings, corporate collaborations,
or warrant solicitations.



We anticipate for the foreseeable future that
cash on hand and cash generated from operations will not be sufficient to meet our cash requirements, and that we will need to
raise additional capital through investments to fund our operations and growth. We cannot assure you that we will be able to raise
additional working or growth capital as needed on terms acceptable to us, if at all. If we are unable to raise capital as needed,
we may be required to reduce the scope of our business development activities, which could harm our business plans, financial condition
and operating results, or cease our operations entirely. Financings, if obtained, may be on terms that are dilutive to our stockholders,
and the prices at which new investors would be willing to purchase our securities may be lower than the price at which existing
stockholders purchased their shares.



Our reported financial results may be
adversely affected by changes in our accounting policies or in accounting principles generally accepted in the United States.



Generally accepted accounting principles in
the United States are subject to interpretation by the Financial Accounting Standards Board, the American Institute of Certified
Public Accountants, the Securities and Exchange Commission and various bodies formed to promulgate and interpret appropriate accounting
principles. The accounting principles and accompanying accounting pronouncements, implementation guidelines and interpretations
for many aspects of our business, including revenue recognition, are highly complex and involve subjective judgments. Some of these
policies require the use of estimates and assumptions that may affect the value of our assets and liabilities, and financial results.
We may be required or determine that it is appropriate to change our accounting policies or the manner in which they are implemented
as circumstances change and additional information becomes known. A change in applicable rules, their interpretation, or their
application could have a significant effect on our reported financial results, and could affect the reporting of transactions completed
before the announcement of a change.



Changes in tax laws or exposure to additional
income tax liabilities could have a material adverse impact on our financial condition and results of operations.



We are subject to income taxes as well as non-income
based taxes, in both the U.S. and various jurisdictions outside the U.S. We are subject to ongoing tax audits in various jurisdictions.
Tax authorities may disagree with certain positions we have taken and assess additional taxes and penalties. We regularly assess
the likely outcomes of these audits in order to determine the appropriateness of our tax provision. However, there can be no assurance
that we will accurately predict the outcomes of these audits, and the actual outcomes of these audits could have a material impact
on our consolidated earnings and financial condition. Additionally, changes in tax laws or tax rulings could materially impact
our effective tax rate. Proposals for fundamental U.S. corporate tax reform, if enacted, could have a material adverse impact on
our future results of operations.



Risks Related to Our Securities



Raising additional capital may cause
dilution to our stockholders or prevent or make more difficult certain transactions, including a sale or merger of the Company.



In the future, we may issue our authorized
but previously unissued equity securities, resulting in the dilution of the ownership interests of our present stockholders. The
Company’s current Articles of Incorporation authorize the Company to issue an aggregate of 71,428,571 shares of common stock
and 10,000,000 shares of “blank check” preferred stock. We may issue additional shares of our common stock or other
securities that are convertible into or exercisable for our common stock in connection with hiring or retaining employees, future
acquisitions, future sales of our securities for capital raising purposes, or for other business purposes. The future issuance
of any such additional shares of our common stock will dilute the ownership interest of our current stockholders and may create
downward pressure on the trading price of the common stock. In addition, the terms of any new securities may include liquidation
or other preferences that may adversely affect the rights of our existing stockholders.



17







The ability of our Board of Directors
to issue additional stock may prevent or make more difficult certain transactions, including a sale or merger of the Company.



Our Board of Directors is authorized to issue
up to 10,000,000 shares of preferred stock with powers, rights and preferences designated by it. Shares of voting or convertible
preferred stock could be issued, or rights to purchase such shares could be issued, to create voting impediments or to frustrate
persons seeking to effect a takeover or otherwise gain control of us. The ability of the Board of Directors to issue such additional
shares of preferred stock, with rights and preferences it deems advisable, could discourage an attempt by a party to acquire control
of us by tender offer or other means. Such issuances could therefore deprive stockholders of benefits that could result from such
an attempt, such as the realization of a premium over the market price for their shares in a tender offer or the temporary increase
in market price that such an attempt could cause. Moreover, the issuance of such additional shares of preferred stock to persons
friendly to the Board of Directors could make it more difficult to remove incumbent officers and directors from office even if
such change were to be favorable to stockholders generally.



We have never paid and do not intend
to pay cash dividends.



Cash dividends have never been declared or
paid on our common stock, and we do not anticipate such a declaration or payment for the foreseeable future. We expect to use future
earnings, if any, to fund business growth. Therefore, stockholders will not receive any funds absent a sale of their shares of
common stock. If we do not pay dividends, our common stock may be less valuable because a return on investment will only occur
if our stock price appreciates.



We are an “emerging growth company,”
and may elect to comply with reduced public company reporting requirements applicable to emerging growth companies, which could
make our common stock less attractive to investors.



We are an “emerging growth company,”
as defined in the JOBS Act enacted in April 2012. For as long as we continue to be an emerging growth company, we may choose to
take advantage of exemptions from various public company reporting requirements. These exemptions include, but are not limited
to, (a) not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act, (b) reduced
disclosure obligations regarding executive compensation in our periodic reports, proxy statements and registration statements,
and (c) exemptions from the requirements of holding a nonbinding advisory vote on executive compensation and stockholder approval
of any golden parachute payments not previously approved. We could be an emerging growth company for up to five years after the
first sale of our common equity securities pursuant to an effective registration statement under the Securities Act of 1933. However,
if certain events occur prior to the end of such five year period, including if we become a “large accelerated filer,”
our annual gross revenues exceed $1 billion or we issue more than $1 billion of non-convertible debt in any three year period,
we would cease to be an emerging growth company prior to the end of such five year period. We have taken advantage of certain of
the reduced disclosure obligations regarding executive compensation in the filings we have made with the SEC and may elect to take
advantage of other reduced burdens in future filings. As a result, the information that we provide to our stockholders may be different
than information received from other public reporting companies. We cannot predict if investors will find our common stock less
attractive as a result of our reliance on these exemptions. If some investors find our common stock less attractive as a result
of any choice we make to reduce disclosure, there may be a less active trading market for our common stock and our stock price
may be more volatile.



Under the JOBS Act, emerging growth companies
can delay adopting new or revised accounting standards until such time as those standards apply to private companies. However,
we have irrevocably elected not to avail ourselves of this extended transition period for complying with new or revised accounting
standards and, therefore, we will be subject to the same new or revised accounting standards as other public companies that are
not emerging growth companies.



18







Being a public company is expensive and
administratively burdensome.



As a public reporting company, we are subject
to the information and reporting requirements of the Securities Act of 1933, the Exchange Act of 1934 and other federal securities
laws, rules and regulations related thereto, including compliance with the Sarbanes-Oxley Act. Complying with these laws and regulations
requires the time and attention of our Board of Directors and management, and increases our expenses. Among other things, we are
required to:



| | · | maintain and evaluate a system of internal controls over financial reporting in compliance with the requirements of Section 404 of the Sarbanes-Oxley Act and the related rules and regulations of the SEC and the Public Company Accounting Oversight Board;
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | maintain policies relating to disclosure controls and procedures;
| | - | -----------------------------------------------------------------



| | · | prepare and distribute periodic reports in compliance with our obligations under federal securities laws;
| | - | ---------------------------------------------------------------------------------------------------------



| | · | institute a more comprehensive compliance function, including with respect to corporate governance; and
| | - | -------------------------------------------------------------------------------------------------------



| | · | involve, to a greater degree, our outside legal counsel and accountants in the above activities.
| | - | ------------------------------------------------------------------------------------------------



The costs of preparing and filing annual and
quarterly reports, proxy statements and other information with the SEC and furnishing audited reports to stockholders is expensive
and much greater than that of a privately-held company, and compliance with these rules and regulations may require us to hire
additional financial reporting, internal controls and other finance personnel, and will involve a material increase in regulatory,
legal and accounting expenses and the attention of management. There can be no assurance that we will be able to comply with the
applicable regulations in a timely manner, if at all. In addition, being a public company makes it more expensive for us to obtain
director and officer liability insurance. In the future, we may be required to accept reduced coverage or incur substantially higher
costs to obtain this coverage. These factors could also make it more difficult for us to attract and retain qualified executives
and members of our Board of Directors, particularly directors willing to serve on our audit committee.



Any failure to maintain effective internal
control over our financial reporting could materially adversely affect us.



Section 404 of the Sarbanes-Oxley Act of 2002 requires us to include
in our annual reports on Form 10-K and quarterly reports on Form 10-Q an assessment by management of the effectiveness of our internal
control over financial reporting. At the time that our Annual Report on Form 10-K for the year ended December 31, 2016 was filed
on March 15, 2017, our principal executive officer and principal financial officer concluded that we maintained effective internal
control over financial reporting as of such date. Subsequent to the issuance of our original Annual Report on Form 10-K for the
year ended December 31, 2016, the Public Company Accounting Oversight Board conducted an inspection of our independent registered
public accounting firm, OUM & Co. LLP (“OUM”). As a result, OUM reevaluated the Company’s information technology
general controls, and concluded that a “material weakness” existed as of December 31, 2016. After consultation with
OUM, management also concluded that the Company’s internal control over financial reporting was not effective at December
31, 2016.



As a natural course of business, management has, over the course
of 2017, been working to further strengthen its internal controls. Specifically, the Company has increased segregation of duties
and implemented a more robust accounting and enterprise resource planning system (which became operational in October 2017). While
we believe that the policies, processes and procedures we have put in place over the course of 2017 will be sufficient to render
our internal controls over financial reporting effective, our initiatives may not prove successful and management may not be able
to conclude that our internal control over financial reporting is effective. Furthermore, even if management were to reach such
a conclusion, if our independent registered public accounting firm is not satisfied with the adequacy of our internal control over
financial reporting, or if the independent auditors interpret the requirements, rules or regulations differently than we do, then
(if required in the future) they may decline to attest to management’s assessment or may issue a report that is qualified.
Any of these events could result in a loss of investor confidence in the reliability of our financial statements, which in turn
could negatively affect the price of our common stock.



In particular, we must perform system and process
evaluation and testing of our internal control over financial reporting to allow management and our independent registered public
accounting firm to report on the effectiveness of our internal control over financial reporting, as required by Section 404. Our
compliance with Section 404 may require that we incur substantial accounting expense and expend significant management efforts..





***



The risks above do not necessarily comprise
all of those associated with an investment in us. This Report contains forward looking statements that involve unknown risks, uncertainties
and other factors that may cause our actual results, financial condition, performance or achievements to be materially different
from any future results, performance or achievements expressed or implied by such forward looking statements. Factors that might
cause such a difference include, but are not limited to, those set out above.



19







PART II



| | ITEM 8. | FINANCIAL STATEMENTS
AND SUPPLEMENTARY DATA
| | ------- | -------------------------------------------



Table of Contents



The following financial statements are filed as part of this Annual
Report on Form 10-K



|                                                                                                                  | PageNumber
|----------------------------------------------------------------------------------------------------------------- | ----------
|Reports of Independent Registered Public Accounting Firm                                                          | 21        
|                                                                                                                  |           
|Consolidated Balance Sheets as of December 31, 2016 and 2015                                                      | 23        
|                                                                                                                  |           
|Consolidated Statements of Operations and Comprehensive Loss for the years ended December 31, 2016, 2015 and 2014 | 24        
|                                                                                                                  |           
|Consolidated Statements of Stockholders’ Equity (Deficit) for the years ended December 31, 2016, 2015 and 2014    | 25        
|                                                                                                                  |           
|Consolidated Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014                        | 27        
|                                                                                                                  |           
|Notes to Consolidated Financial Statements                                                                        | 28        



20







REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING
FIRM



Board of Directors and Stockholders of

Ekso Bionics Holdings, Inc.



We have audited the accompanying consolidated
balance sheets of Ekso Bionics Holdings, Inc. as of December 31, 2016 and 2015, and the related consolidated statements of operations
and comprehensive loss, stockholders’ equity (deficit), and cash flows for each of the three years in the period ended December
31, 2016. These financial statements are the responsibility of the Company’s management. Our responsibility is to express
an opinion on these financial statements based on our audits.



We conducted our audits in accordance with
the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform
the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit also
includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our opinion.



In our opinion, the consolidated financial
statements referred to above present fairly, in all material respects, the financial position of Ekso Bionics Holdings, Inc. at
December 31, 2016 and 2015, and the results of its operations and its cash flows for each of the three years in the period ended
December 31, 2016 in conformity with U.S. generally accepted accounting principles.



The accompanying consolidated financial statements
have been prepared assuming that the Company will continue as a going concern. As discussed in Note 1 to the consolidated financial
statements, the Company has suffered recurring losses from operations and has a net capital deficiency that raise substantial doubt
about its ability to continue as a going concern. Management’s plans in regard to these matters are also described in Note 1. The
consolidated financial statements do not include any adjustments that might result from the outcome of this uncertainty.



We also have audited, in accordance with the
standards of the Public Company Accounting Oversight Board (United States), Ekso Bionics Holdings, Inc.’s internal control
over financial reporting as of December 31, 2016, based on criteria established in Internal Control – Integrated
Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO), and our report dated
March 14, 2017, except for the effect of the material weakness described in the sixth paragraph of that report, as to which the
date is December 27, 2017, expressed an adverse opinion thereon.



|/s/ OUM & CO. LLP         | 
|------------------------- | 
|                          | 
|San Francisco, California | 
|March 14, 2017            | 



21







Report
of Independent Registered Public Accounting Firm



Board of Directors and Stockholders of
Ekso Bionics Holdings, Inc.



We have audited Ekso Bionics Holdings, Inc.’s
internal control over financial reporting as of December 31, 2016, based on criteria established in Internal Control—Integrated
Framework (2013)issued by the Committee of Sponsoring Organizations of the Treadway Commission (the COSO criteria). Ekso Bionics
Holdings, Inc.’s management is responsible for maintaining effective internal control over financial reporting, and for its
assessment of the effectiveness of internal control over financial reporting included in the accompanying report, Item 9A, Management’s
Report on Internal Control Over Financial Reporting. Our responsibility is to express an opinion on the company’s internal
control over financial reporting based on our audit.



We conducted our audit in accordance with the
standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the
audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material
respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial
reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness
of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary
in the circumstances. We believe that our audit provides a reasonable basis for our opinion.



A company’s internal control over financial
reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal
control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in
reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable
assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally
accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations
of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized
acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.



Because of its inherent limitations, internal
control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness
to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree
of compliance with the policies or procedures may deteriorate.



In our report dated March 14, 2017, we expressed
an unqualified opinion that Ekso Bionics Holdings, Inc. maintained, in all material respects, effective internal control over financial
reporting as of December 31, 2016, based on the COSO criteria. Management has subsequently identified a deficiency related to the
Company’s information technology (IT) general controls and segregation of duties, and has further concluded that such deficiency
represented a material weakness as of December 31, 2016. As a result, management has restated its assessment, as presented in the
accompanying Management’s Report on Internal Control Over Financial Reporting; to conclude that Ekso Bionics Holdings,
Inc.’s internal control over financial reporting was not effective as of December 31, 2016. Accordingly, our present opinion
on the effectiveness of the Company’s internal control over financial reporting as of December 31, 2016, as expressed herein,
is different from that expressed in our previous report.



A material weakness is a control deficiency,
or combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that
a material misstatement of the Company’s annual or interim financial statements will not be prevented or detected on a timely
basis. The following material weakness has been identified and included in management’s assessment. Management identified
a material weakness in internal control over financial reporting relating to the Company’s IT general controls and segregation
of duties. Specifically, the Company did not design and maintain processes and procedures that restrict access to key financial
systems and records to appropriate users, and the Company did not appropriately evaluate whether there was an adequate segregation
of duties. We have also audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States),
the consolidated balance sheets of Ekso Bionics Holdings, Inc. as of December 31, 2016 and 2015, and the related consolidated
statements of operations and comprehensive loss, stockholders’ equity (deficit), and cash flows for each of the three years
in the period ended December 31, 2016. This material weakness was considered in determining the nature, timing, and extent of audit
tests applied in our audit of the 2016 consolidated financial statements, and this report does not affect our report dated March
14, 2017 which expressed an unqualified opinion on those financial statements.



In our opinion, because of the effect of the
material weakness described above on the achievement of the objectives of the control criteria, Ekso Bionics Holdings, Inc. has
not maintained effective internal control over financial reporting as of December 31, 2016, based on COSO criteria.



|/s/ OUM & CO. LLP | 
|----------------- | 



San Francisco, California

March 14, 2017, except for the effect of the material weakness

described in the sixth paragraph above, as to which the date is
December 27, 2017



22







Ekso Bionics Holdings, Inc.

Consolidated Balance Sheets

(In thousands, except par value amounts)



|                                                                                                                                                        |  | December 31, |         
|------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------ | --------
|                                                                                                                                                        |  | 2016         |         
|                                                                                                                                                        |  |              |         
|Assets                                                                                                                                                  |  |              |         
|Current assets:                                                                                                                                         |  |              |         
|Cash                                                                                                                                                    |  | $            | 16,846  
|Accounts receivable, net of allowances of $107 and $93, respectively                                                                                    |  |              | 1,780   
|Inventories, net                                                                                                                                        |  |              | 1,556   
|Prepaid expenses and other current assets                                                                                                               |  |              | 502     
|Deferred cost of revenue, current                                                                                                                       |  |              | -       
|Total current assets                                                                                                                                    |  |              | 20,684  
|Property and equipment, net                                                                                                                             |  |              | 2,435   
|Deferred cost of revenue                                                                                                                                |  |              | -       
|Intangible assets, net                                                                                                                                  |  |              | 1,026   
|Goodwill                                                                                                                                                |  |              | 189     
|Other assets                                                                                                                                            |  |              | 91      
|Total assets                                                                                                                                            |  | $            | 24,425  
|                                                                                                                                                        |  |              |         
|Liabilities and Stockholders’ Equity                                                                                                                    |  |              |         
|Current liabilities:                                                                                                                                    |  |              |         
|Accounts payable                                                                                                                                        |  | $            | 1,879   
|Accrued liabilities                                                                                                                                     |  |              | 3,556   
|Deferred revenues, current                                                                                                                              |  |              | 825     
|Capital lease obligation, current                                                                                                                       |  |              | 54      
|Total current liabilities                                                                                                                               |  |              | 6,314   
|Deferred revenues                                                                                                                                       |  |              | 805     
|Note payable, net                                                                                                                                       |  |              | 6,789   
|Warrant liability                                                                                                                                       |  |              | 3,546   
|Contingent consideration liability                                                                                                                      |  |              | 217     
|Contingent success fee liability                                                                                                                        |  |              | 116     
|Other non-current liabilities                                                                                                                           |  |              | 107     
|Total liabilities                                                                                                                                       |  |              | 17,894  
|Commitments and contingencies (Note 16)                                                                                                                 |  |              |         
|Stockholders’ equity:                                                                                                                                   |  |              |         
|Convertible preferred stock, $0.001 par value; 10,000 shares authorized; none and 13 issued and outstanding at December 31, 2016 and 2015, respectively |  |              | -       
|Common stock, $0.001 par value; 71,429 shares authorized; 21,894 and 15,027, shares issued and outstanding at December 31, 2016 and 2015, respectively  |  |              | 22      
|Additional paid-in capital                                                                                                                              |  |              | 121,291 
|Accumulated other comprehensive income (loss)                                                                                                           |  |              | 79      
|Accumulated deficit                                                                                                                                     |  |              | (114,861
|Total stockholders’ equity                                                                                                                              |  |              | 6,531   
|Total liabilities and stockholders’ equity                                                                                                              |  | $            | 24,425  



See accompanying notes to consolidated financial
statements



23







Ekso Bionics Holdings, Inc.

Consolidated Statements of Operations and
Comprehensive Loss

(In thousands, except per share amounts)



|                                                             |  | Years ended December 31, |        
|------------------------------------------------------------ |  | ------------------------ | -------
|                                                             |  | 2016                     |        
|Revenue:                                                     |  |                          |        
|Device and related                                           |  | $                        | 13,334 
|Engineering services                                         |  |                          | 887    
|Total revenue                                                |  |                          | 14,221 
|                                                             |  |                          |        
|Cost of revenue:                                             |  |                          |        
|Device and related                                           |  |                          | 10,715 
|Engineering services                                         |  |                          | 559    
|Total cost of revenue                                        |  |                          | 11,274 
|                                                             |  |                          |        
|Gross profit                                                 |  |                          | 2,947  
|                                                             |  |                          |        
|Operating expenses:                                          |  |                          |        
|Sales and marketing                                          |  |                          | 10,997 
|Research and development                                     |  |                          | 8,879  
|General and administrative                                   |  |                          | 10,853 
|Change in fair value, contingent consideration               |  |                          | (196   
|Total operating expenses                                     |  |                          | 30,533 
|                                                             |  |                          |        
|Loss from operations                                         |  |                          | (27,586
|                                                             |  |                          |        
|Other income (expense), net:                                 |  |                          |        
|Interest expense                                             |  |                          | (16    
|Warrant issuance expense                                     |  |                          | -      
|Gain (loss) on warrant liability                             |  |                          | 4,286  
|Interest income                                              |  |                          | 12     
|Other expense, net                                           |  |                          | (166   
|Total other income (expense), net                            |  |                          | 4,116  
|                                                             |  |                          |        
|Net loss                                                     |  |                          | (23,470
|                                                             |  |                          |        
|Less: Preferred deemed dividend                              |  |                          | 10,345 
|Net loss applicable to common shareholders                   |  |                          | (33,815
|Foreign currency translation adjustments                     |  |                          | 80     
|Comprehensive loss applicable to common shareholders         |  | $                        | (33,735
|                                                             |  |                          |        
|Basic net loss per share applicable to common shareholders   |  | $                        | (1.87  
|Diluted net loss per share applicable to common shareholders |  | $                        | (2.05  
|Weighted average number of shares outstanding, basic         |  |                          | 18,126 
|Weighted average number of shares outstanding, diluted       |  |                          | 18,622 



See accompanying notes to consolidated financial
statements



24







Ekso Bionics Holdings, Inc.

Consolidated Statements of Stockholders’
Equity (Deficit)
(In thousands)



|                                                                                                                                        |  |                     |         |   |              |   |         |         |  |  |               |  |  |             |    |  | Accumulated |   |         |               |  |   | Total     | 
|--------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------- | ------- | - | ------------ | - | ------- | ------- |  |  | ------------- |  |  | ----------- | -- |  | ----------- | - | ------- | ------------- |  | - | --------- | 
|                                                                                                                                        |  | Convertible         |         |   |              |   |         |         |  |  | Additional    |  |  | Other       |    |  |             |   |         | Stockholders’ | 
|                                                                                                                                        |  | Preferred
    Stock |         |   | Common Stock |   |         | Paid-in |  |  | Comprehensive |  |  | Accumulated |    |  | Equity      |  
|                                                                                                                                        |  | Shares              |         |   | Amount       |   |         | Shares  |  |  | Amount        |  |  | Capital     |    |  | Loss        |   |         | Deficit       |  |   | (Deficit) | 
|Balance at December 31, 2013 (See Note 3)                                                                                               |  |                     | 25,924  |   |              | $ | 27,324  |         |  |  | 3,016         |  |  | $           | 3  |  |             | $ | 1,656   |               |  | $ | -         | 
|Issuance of common stock upon exercise of options                                                                                       |  |                     |         |   |              |   |         |         |  |  | 13            |  |  |             | -  |  |             |   | 2       |               |  |   | -         | 
|Fair value of warrant liability transferred to equity upon net exercise                                                                 |  |                     | 767     |   |              |   |         |         |  |  |               |  |  |             | -  |  |             |   | 282     |               |  |   | -         | 
|Conversion of preferred stock                                                                                                           |  |                     | (26,691 | ) |              |   | (27,324 | )       |  |  | 3,813         |  |  |             | 4  |  |             |   | 27,320  |               |  |   | -         | 
|Balance at January 15, 2014  before Merger and PPO                                                                                      |  |                     | -       |   |              |   | -       |         |  |  | 6,842         |  |  |             | 7  |  |             |   | 29,260  |               |  |   | -         | 
|PPO shares issued for cash                                                                                                              |  |                     | -       |   |              |   | -       |         |  |  | 3,614         |  |  |             | 4  |  |             |   | 25,296  |               |  |   | -         | 
|PPO shares issued upon conversion of 2013 Bridge Notes                                                                                  |  |                     | -       |   |              |   | -       |         |  |  | 714           |  |  |             | 1  |  |             |   | 5,081   |               |  |   | -         | 
|Shares issued to consultant in PPO                                                                                                      |  |                     |         |   |              |   |         |         |  |  | 36            |  |  |             | -  |  |             |   | -       |               |  |   | -         | 
|Fair value of warrant obligation transferred to equity                                                                                  |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | 96      |               |  |   | -         | 
|Unamortized debt discounts transferred to equity                                                                                        |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | (947    | )             |  |   | -         | 
|Offering costs of PPO shares                                                                                                            |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | (3,339  | )             |  |   | -         | 
|Issuance of common stock warrants at fair value                                                                                         |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | (10,614 | )             |  |   | -         | 
|Balance at January 15, 2014 after Merger and PPO                                                                                        |  |                     | -       |   |              |   | -       |         |  |  | 11,206        |  |  |             | 12 |  |             |   | 44,833  |               |  |   | -         | 
|Issuance of common stock from exercise of warrants                                                                                      |  |                     | -       |   |              |   | -       |         |  |  | 3,269         |  |  |             | 3  |  |             |   | 21,409  |               |  |   | -         | 
|Fair value of warrant anti-dilution feature transferred to equity                                                                       |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | 27,099  |               |  |   | -         | 
|Issuance of common stock upon exercise of stock options                                                                                 |  |                     | -       |   |              |   | -       |         |  |  | 42            |  |  |             | -  |  |             |   | 102     |               |  |   | -         | 
|Stock-based compensation expense                                                                                                        |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | 1,143   |               |  |   | -         | 
|Net loss                                                                                                                                |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | -       |               |  |   | -         | 
|Balance at December 31, 2014                                                                                                            |  |                     | -       |   |              |   | -       |         |  |  | 14,517        |  |  |             | 15 |  |             |   | 94,586  |               |  |   | -         | 
|Issuance of Series A convertible preferred stock, net of issuance costs of $779                                                         |  |                     | 15      |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | 14,218  |               |  |   | -         | 
|Allocation of proceeds from Series A preferred stock to warrant liability                                                               |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | (11,700 | )             |  |   | -         | 
|Beneficial conversion feature on Series A preferred stock                                                                               |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | 3,300   |               |  |   | -         | 
|Conversion of Series A convertible preferred stock  to common stock and  accretion
    of Series A convertible preferred stock discount |  |                     | (2      | ) |              |   | -       |         |  |  | 246           |  |  |             | -  |  |             |   | 1,356   |               |  |   | -         | 
|Deemed dividend on Series A convertible preferred stock                                                                                 |  |                     | -       |   |              |   | -       |         |  |  | -             |  |  |             | -  |  |             |   | (4,655  | )             |  |   | -         | 



25







|                                                                                                                                       |  |                 |     |   |              |   |   |         |  |  |               |  |  |             |    |  | Accumulated |   |         |               |  |   | Total     |  
|-------------------------------------------------------------------------------------------------------------------------------------- |  | --------------- | --- | - | ------------ | - | - | ------- |  |  | ------------- |  |  | ----------- | -- |  | ----------- | - | ------- | ------------- |  | - | --------- | -
|                                                                                                                                       |  | Convertible     |     |   |              |   |   |         |  |  | Additional    |  |  | Other       |    |  |             |   |         | Stockholders’ | 
|                                                                                                                                       |  | Preferred Stock |     |   | Common Stock |   |   | Paid-in |  |  | Comprehensive |  |  | Accumulated |    |  | Equity      |  
|                                                                                                                                       |  | Shares          |     |   | Amount       |   |   | Shares  |  |  | Amount        |  |  | Capital     |    |  | Loss        |   |         | Deficit       |  |   | (Deficit) |  
|Issuance of common stock for assets acquired from Equipois                                                                             |  |                 | -   |   |              |   | - |         |  |  | 112           |  |  |             | -  |  |             |   | 1,071   |               |  |   | -         |  
|Issuance of common stock upon exercise of warrants                                                                                     |  |                 | -   |   |              |   | - |         |  |  | 7             |  |  |             | -  |  |             |   | 53      |               |  |   | -         |  
|Issuance of common stock upon exercise of stock options                                                                                |  |                 | -   |   |              |   | - |         |  |  | 145           |  |  |             | -  |  |             |   | 225     |               |  |   | -         |  
|Stock-based compensation expense                                                                                                       |  |                 | -   |   |              |   | - |         |  |  | -             |  |  |             | -  |  |             |   | 1,731   |               |  |   | -         |  
|Net loss                                                                                                                               |  |                 | -   |   |              |   | - |         |  |  | -             |  |  |             | -  |  |             |   | -       |               |  |   | -         |  
|Foreign currency translation adjustments                                                                                               |  |                 | -   |   |              |   | - |         |  |  | -             |  |  |             | -  |  |             |   | -       |               |  |   | (1        | )
|Balance at December 31, 2015                                                                                                           |  |                 | 13  |   |              |   | - |         |  |  | 15,027        |  |  |             | 15 |  |             |   | 100,185 |               |  |   | (1        | )
|Shares issued as a result of rounding due to reverse-stock split                                                                       |  |                 | -   |   |              |   | - |         |  |  | 8             |  |  |             | -  |  |             |   | -       |               |  |   | -         |  
|Issuance of common stock, net of underwriting discount & issuance costs of $1,373                                                      |  |                 | -   |   |              |   | - |         |  |  | 4,017         |  |  |             | 4  |  |             |   | 14,690  |               |  |   | -         |  
|Conversion of Series A convertible preferred stock  to common stock and accretion
    of Series A convertible preferred stock discount |  |                 | (13 | ) |              |   | - |         |  |  | 2,310         |  |  |             | 3  |  |             |   | 10,342  |               |  |   | -         |  
|Deemed dividend on Series A convertible preferred stock                                                                                |  |                 | -   |   |              |   | - |         |  |  | -             |  |  |             | -  |  |             |   | (10,345 | )             |  |   | -         |  
|Issuance of common stock upon exercise of warrants                                                                                     |  |                 | -   |   |              |   | - |         |  |  | 488           |  |  |             | -  |  |             |   | 3,188   |               |  |   | -         |  
|Issuance of common stock upon exercise of stock options                                                                                |  |                 | -   |   |              |   | - |         |  |  | 44            |  |  |             | -  |  |             |   | 110     |               |  |   | -         |  
|Stock-based compensation expense                                                                                                       |  |                 | -   |   |              |   | - |         |  |  | -             |  |  |             | -  |  |             |   | 3,121   |               |  |   | -         |  
|Net loss                                                                                                                               |  |                 | -   |   |              |   | - |         |  |  | -             |  |  |             | -  |  |             |   | -       |               |  |   | -         |  
|Foreign currency translation adjustments                                                                                               |  |                 | -   |   |              |   | - |         |  |  | -             |  |  |             | -  |  |             |   | -       |               |  |   | 80        |  
|Balance at December 31 , 2016                                                                                                          |  |                 | -   |   |              | $ | - |         |  |  | 21,894        |  |  | $           | 22 |  |             | $ | 121,291 |               |  | $ | 79        |  



See accompanying notes to consolidated financial
statements



26







Ekso Bionics Holdings, Inc.

Consolidated Statement of Cash Flows
(In thousands)



|                                                                                                                                                  |  | Years ended December 31, |        
|------------------------------------------------------------------------------------------------------------------------------------------------- |  | ------------------------ | -------
|                                                                                                                                                  |  | 2016                     |        
|Operating activities                                                                                                                              |  |                          |        
|Net loss                                                                                                                                          |  | $                        | (23,470
|Adjustments to reconcile net loss to net cash used in operating activities                                                                        |  |                          |        
|Depreciation and amortization                                                                                                                     |  |                          | 1,855  
|Inventory allowance expense                                                                                                                       |  |                          | 30     
|Amortization of deferred rent                                                                                                                     |  |                          | (36    
|Amortization of debt discounts                                                                                                                    |  |                          | -      
|Finance cost attributable to issuance of warrants                                                                                                 |  |                          | -      
|Interest expense accrued to convertible notes                                                                                                     |  |                          | -      
|Interest income added to note receivable from stockholder                                                                                         |  |                          | -      
|Change in fair value of contingent consideration liability                                                                                        |  |                          | (196   
|Stock-based compensation expense                                                                                                                  |  |                          | 3,121  
|Change in fair value of warrant liability                                                                                                         |  |                          | (4,286 
|Unrealized loss on foreign currency transactions                                                                                                  |  |                          | 135    
|Changes in operating assets and liabilities                                                                                                       |  |                          |        
|Accounts receivable                                                                                                                               |  |                          | 154    
|Inventories                                                                                                                                       |  |                          | (541   
|Prepaid expense and other assets current and noncurrent                                                                                           |  |                          | (60    
|Deferred cost of revenue                                                                                                                          |  |                          | 4,590  
|Accounts payable                                                                                                                                  |  |                          | (818   
|Accrued liabilities                                                                                                                               |  |                          | 1,468  
|Deferred revenues                                                                                                                                 |  |                          | (6,943 
|Net cash used in operating activities                                                                                                             |  |                          | (24,997
|Investing activities                                                                                                                              |  |                          |        
|Acquisition of property and equipment, net                                                                                                        |  |                          | (1,096 
|Net cash used in investing activities                                                                                                             |  |                          | (1,096 
|Financing activities                                                                                                                              |  |                          |        
|Principal payments on notes payable                                                                                                               |  |                          | (79    
|Fees paid related to 2015 issuance of convertible preferred stock                                                                                 |  |                          | (173   
|Proceeds from issuance of common stock, net                                                                                                       |  |                          | 14,694 
|Proceeds from issuance of convertible preferred stock and warrants, net                                                                           |  |                          | -      
|Proceeds from exercise of stock options                                                                                                           |  |                          | 110    
|Proceeds from exercise of common stock warrants                                                                                                   |  |                          | 1,825  
|Proceeds from issuance of long-term debt, net of financing costs                                                                                  |  |                          | 6,930  
|Net cash provided by financing activities                                                                                                         |  |                          | 23,307 
|Effect of exchange rate changes on cash                                                                                                           |  |                          | 80     
|Net (decrease) increase in cash                                                                                                                   |  |                          | (2,706 
|Cash at beginning of the period                                                                                                                   |  |                          | 19,552 
|Cash at end of the period                                                                                                                         |  | $                        | 16,846 
|                                                                                                                                                  |  |                          |        
|Supplemental  disclosure of cash flow activities                                                                                                  |  |                          |        
|Cash paid for interest                                                                                                                            |  | $                        | 16     
|Cash paid for income taxes                                                                                                                        |  | $                        | 33     
|                                                                                                                                                  |  |                          |        
|Supplemental disclosure of non-cash activities                                                                                                    |  |                          |        
|Acquisition of property and equipment with capital lease                                                                                          |  | $                        | -      
|Transfer of property and equipment to inventory                                                                                                   |  | $                        | 11     
|Contingent success fee liability for term loan                                                                                                    |  | $                        | 116    
|Preferred deemed dividend to common shareholders in connection with anti-dilution feature associated with issuance of Series A preferred warrants |  | $                        | 10,345 
|Issuance of Series A preferred stock warrants                                                                                                     |  | $                        | -      
|Acquisition of Equipois assets with common stock and contingent consideration liability                                                           |  | $                        | -      
|Conversion of bridge loan to common stock                                                                                                         |  | $                        | -      
|Conversion of convertible preferred stock to common stock                                                                                         |  | $                        | 3      
|Conversion of preferred stock warrants to common stock warrants                                                                                   |  | $                        | -      
|Reclassification of warrant liability to equity upon exercise of warrants                                                                         |  | $                        | 1,363  



See accompanying notes to consolidated financial
statements



27







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



1. Organization



Description of Business



On January 15, 2014, a wholly-owned subsidiary
of Ekso Bionics Holdings, Inc. named Ekso Acquisition Corp. merged with and into Ekso Bionics, Inc. (the “Merger”).
Ekso Bionics, Inc. was the surviving corporation and became a wholly-owned subsidiary of Ekso Bionics Holdings, Inc. As a result
of this transaction, Ekso Bionics Holdings, Inc. discontinued its pre-merger operations, acquired the business of Ekso Bionics,
Inc. and continues the operations of Ekso Bionics, Inc. as a publicly traded company. See Note 3, 2014 Merger, Offering and
Other Related Transactions.Ekso Bionics, Inc. was incorporated in January 2005 in the State of Delaware.



As used in these notes to the consolidated
financial statements, the term “the Company” refers to Ekso Bionics Holdings, Inc. formerly known as PN Med Group,
Inc., and its wholly-owned subsidiaries, including Ekso Bionics, Inc. after giving effect to the Merger; the term “Holdings”
refers to the business of Ekso Bionics Holdings, Inc. prior to the Merger, and the term “Ekso Bionics” refers to Ekso
Bionics, Inc. prior to the Merger. Unless otherwise indicated, all dollar and share amounts included in these notes to the consolidated
financial statements are in thousands.



The Company designs, develops, and sells exoskeletons
that augment human strength, endurance and mobility. The Company’s exoskeletons have applications in health care, industrial,
military, and consumer markets.



Liquidity and Going Concern



Largely as a result of significant research
and development activities related to the development of the Company’s advanced technology and commercialization of this
technology into its medical device business, the Company has incurred significant operating losses and negative cash flows from
operations since inception. The Company has also recognized significant non-cash losses associated with the revaluation of certain
securities, which have also contributed significantly to its accumulated deficit. As of December 31, 2016, the Company had an accumulated
deficit of $114,861.



Cash on hand at December 31, 2016 was $16,846,
compared to $19,552 at December 31, 2015. For the year ended December 31, 2016, the Company used $24,972 of cash in operations
compared to $18,269 for the year ended December 31, 2015. As noted in Note 9, Long-Term Debt, borrowings under our long-term
debt agreement have a requirement of minimum cash on hand roughly equivalent to three months of cash burn. As of January 31, 2017,
the most recent determination of this restriction, $6,026 of cash must remain as unrestricted, with such amounts to be re-computed
at each month end period. After considering cash such restriction, effective unrestricted cash as of December 31, 2016 is estimated
to be $10,820. Based on current forecasted amounts, our on hand will not be sufficient to satisfy our operations for the next twelve
months from the date of issuance of these consolidated financial statements, which raises substantial doubt about our ability to
continue as a going concern.



Based upon the Company’s current cash
resources, the recent rate of using cash for operations and investment, and assuming modest increases in current revenue offset
by incremental increases in expenses related to increased sales and marketing and research and development, and a potential increase
in rental activity from its medical device business, the Company believes it has sufficient resources to meet its financial obligations
into the third quarter of 2017. The Company will require significant additional financing. The Company is actively pursuing opportunities
to obtain additional financing in the future through public or private equity and/or debt financings, corporate collaborations,
or warrant solicitations.



The Company’s actual capital requirements
may vary significantly and will depend on many factors. For example, the Company plans to continue to increase its investments
(i) in its clinical, sales and marketing initiatives to accelerate adoption of the Ekso robotic exoskeleton in the rehabilitation
market, (ii) in its research, development and commercialization activities with respect to an Ekso robotic exoskeleton for home
use, and/or (iii) in the development and commercialization of able-bodied exoskeletons for industrial use. Consequently, the Company
will require significant additional financing in the future, which the Company intends to raise through corporate collaborations,
public or private equity offerings, debt financings, or warrant solicitations. Sales of additional equity securities by us could
result in the dilution of the interests of existing stockholders. There can be no assurance that financing will be available when
required in sufficient amounts, on acceptable terms or at all. In the event that the necessary additional financing is not obtained,
the Company may be required to reduce its discretionary overhead costs substantially, including research and development, general
and administrative, and sales and marketing expenses or otherwise curtail operations.



28







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



2. Summary of Significant Accounting Policies and Estimates



Principles of Consolidation and Basis of
Presentation



The accompanying consolidated financial statements
have been prepared in accordance with accounting principles generally accepted in the United States (“U.S. GAAP”).
All significant intercompany transactions and balances have been eliminated in consolidation. Certain reclassifications have been
made to conform to the current period’s presentation. All common share and per share amounts have been adjusted to reflect
the one-for-seven reverse stock split completed on May 4, 2016. See Note 13, Capitalization and Equity Structure – Reverse
Stock Split.



Use of Estimates



The preparation of the consolidated financial
statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts
of assets and liabilities and disclosure of contingent assets and liabilities at the date of the balance sheet, and the reported
amounts of revenues and expenses during the reporting period. For the Company, these estimates include, but are not limited to:
revenue recognition, deferred revenue and the deferral of associated costs, valuation of acquired intangible assets and goodwill,
useful lives assigned to long-lived assets, realizability of deferred tax assets, valuation of common and preferred stock warrants,
the valuation of options, and contingencies. Actual results could differ from those estimates.



Foreign Currency Translation



The assets and liabilities of foreign subsidiaries,
where the local currency is the functional currency, are translated from their respective functional currencies into U.S. dollars
at the rates in effect at the balance sheet date and revenue and expense amounts are translated at average rates during the period,
with resulting foreign currency translation adjustments recorded in accumulated other comprehensive income (loss) as a component
of stockholders’ equity. Where the U.S. dollar is the functional currency, re-measurement adjustments are recorded in other
comprehensive income (loss), net in the accompanying consolidated statements of operations and comprehensive loss.



Gains and losses realized from transactions,
including related party balances not considered permanent investments, that are denominated in currencies other than an entity’s
functional currency are included in other expense, net in the accompanying consolidated statements of operations and comprehensive
loss.



Accumulated Other Comprehensive Income (Loss)



Accumulated other comprehensive income (loss)
reported on our consolidated balance sheets consists of foreign currency translation adjustments.



The change in accumulated other comprehensive
income (loss) presented on the consolidated balance sheets for the year ended December 31, 2016, is reflected in the table below
net of tax:



|                                                                        |  | Foreign     |   
|----------------------------------------------------------------------- |  | ----------- | --
|                                                                        |  | Currency    |   
|                                                                        |  | Translation |   
|Balance at December 31, 2015                                            |  | $           | (1
|Other comprehensive loss before reclassification                        |  |             | 80
|Amounts reclassified from accumulated other comprehensive income (loss) |  |             | - 
|Net current period other comprehensive income                           |  |             | 80
|Balance at December 31, 2016                                            |  | $           | 79



29







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



Cash and Cash Equivalents



The Company considers all highly liquid investments
purchased with a maturity of three months or less to be cash equivalents. The Company’s cash is deposited in bank accounts
with the Company’s primary cash management bank. The Company places its cash and cash equivalents in highly liquid instruments
with, and in the custody of, financial institutions with high credit ratings. The Company did not have any cash equivalents or
investments in money market funds as of December 31, 2016 and 2015.



Concentration of Credit Risk and Other Risks
and Uncertainties



Financial instruments that potentially subject
us to concentrations of credit risk consist principally of cash and accounts receivable. The Company maintains our cash accounts
in excess of federally insured limits. However, the Company believes it is not exposed to significant credit risk due to the financial
position of the depository institutions in which these deposits are held.  The Company extends credit to customers in the
normal course of business and performs ongoing credit evaluations of its customers. Concentrations of credit risk with respect
to accounts receivable exist to the full extent of amounts presented in the consolidated financial statements. The Company does
not require collateral from its customers to secure accounts receivable.



Accounts receivable are derived from the sale
of products shipped and services performed for customers located in the U.S. and throughout the world. Invoices are aged based
on contractual terms with the customer. The Company reviews accounts receivable for collectability and provides an allowance for
credit losses, as needed. The Company has not experienced material losses related to accounts receivable during the years ended
December 31, 2016 and December 31, 2015. Many of the sales contracts with customers outside of the U.S. are settled in a foreign
currency other than the U.S. dollar. The Company does not enter into any foreign currency hedging agreements and is susceptible
to gains and losses from foreign currency fluctuations. To date, the Company has not experienced significant gains or losses upon
settling foreign contracts.



At December 31, 2016, the Company had three
customers with accounts receivable balances totaling 10% or more of the Company’s total accounts receivable (18%, 16% and
11%) compared with one customer at December 31, 2015 (10%) and two customers at December 31, 2014 (22% and 11%).



For the year ended December 31, 2016, the Company
had no customers with billed revenue of 10% or more of the Company’s total customer revenue, compared with one customer for
the year ended December 31, 2015 (33%) and one customer for the year ended December 31, 2014 (12%).



Inventories, net



Inventories are recorded at the lower of cost
or market value. Cost is principally determined using the average cost method. Parts from vendors are received and recorded as
raw material. Once the raw materials are incorporated in the fabrication of the product, the related value of the component is
recorded as work in progress (“WIP”). Direct and indirect labor and applicable overhead costs are also allocated and
recorded to WIP inventory. Finished goods are comprised of completed products that are ready for customer shipment. The Company
periodically evaluates the carrying value of inventory on hand for potential excess amounts over sales and forecasted demand. Excess
and obsolete inventories identified, if any, are recorded as an inventory impairment charge to the consolidated statements of operations
and comprehensive loss.



Property and Equipment, net



Property and equipment are stated at cost less
accumulated depreciation and are depreciated on a straight-line basis over the estimated useful lives of the assets, generally
ranging from three to thirteen years. Leasehold improvements are amortized over the shorter of the estimated useful life of ten
years or the related term of the lease.



The costs of repairs and maintenance are expensed
when incurred, while expenditures for refurbishments and improvements that significantly add to the productive capacity or extend
the useful life of an asset are capitalized. When assets are retired or sold, the asset cost and related accumulated depreciation
or amortization are removed from the accompanying consolidated balance sheets, with any gain or loss reflected in the accompanying
consolidated statements of operations and comprehensive loss. The Company has evaluated its lease obligations and does not have
any material asset retirement obligations.



30







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



Impairment of Long-Lived Assets



The Company assesses the impairment of long-lived
assets whenever events or changes in circumstances indicate that their carrying value may not be recoverable from the estimated
future cash flows expected to result from their use or eventual disposition. If estimates of future undiscounted net cash flows
are insufficient to recover the carrying value of the assets, the Company will record an impairment loss in the amount by which
the carrying value of the assets exceeds the fair value. If the assets are determined to be recoverable, but the useful lives are
shorter than originally estimated, the Company will depreciate or amortize the net book value of the assets over the newly determined
remaining useful lives. None of the Company’s property and equipment or intangible assets were impaired as of December 31,
2016 and 2015. Accordingly, no impairment loss has been recognized in the years ended December 31, 2016, 2015, and 2014.



Goodwill



The Company records goodwill when the purchase
price of an acquisition exceeds the fair value of the net tangible and identified intangible assets acquired. We perform an annual
impairment assessment in the fourth quarter of each year, or more frequently if indicators of potential impairment exist, which
includes evaluating qualitative and quantitative factors to assess the likelihood of an impairment of goodwill. We perform impairment
tests using a fair value approach when necessary. None of the Company’s goodwill was impaired as of December 31, 2016 and
2015. Accordingly, no impairment loss has been recognized in the years ended December 31, 2016, 2015, and 2014. For further discussion
of goodwill, see Note 4 Equipois Acquisition.



Convertible Instruments



We account for hybrid contracts that feature
conversion options in accordance with generally accepted accounting principles in the United States. Accounting Standards Codification
(“ASC”) 815, Derivatives and Hedging Activities (“ASC 815”) requires companies to bifurcate conversion
options from their host instruments and account for them as free standing derivative financial instruments according to certain
criteria. The criteria includes circumstances in which (a) the economic characteristics and risks of the embedded derivative instrument
are not clearly and closely related to the economic characteristics and risks of the host contract, (b) the hybrid instrument
that embodies both the embedded derivative instrument and the host contract is not re-measured at fair value under otherwise applicable
generally accepted accounting principles with changes in fair value reported in earnings as they occur and (c) a separate instrument
with the same terms as the embedded derivative instrument would be considered a derivative instrument.



Conversion options that contain variable settlement
features such as provisions to adjust the conversion price upon subsequent issuances of equity or equity linked securities at exercise
prices more favorable than that featured in the hybrid contract generally result in their bifurcation from the host instrument.



We account for convertible instruments when
we have determined that the embedded conversion options should not be bifurcated from their host instruments, in accordance with
ASC 470-20, Debt with Conversion and Other Options (“ASC 470-20”). Under ASC 470-20, we record, when necessary,
discounts to convertible notes for the intrinsic value of conversion options embedded in debt instruments based upon the differences
between the fair value of the underlying common stock at the commitment date of the note transaction and the effective conversion
price embedded in the note. We account for convertible instruments (when we have determined that the embedded conversion options
should be bifurcated from their host instruments) in accordance with ASC 815.  Under ASC 815, a portion of the proceeds
received upon the issuance of the hybrid contract is allocated to the fair value of the derivative. The derivative is subsequently
marked to market at each reporting date based on current fair value, with the changes in fair value reported in results of operations.



31







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



We also follow ASC 480-10, Distinguishing
Liabilities from Equity (“ASC 480-10”) in its evaluation of the accounting for a hybrid instrument. A financial
instrument that embodies an unconditional obligation, or a financial instrument other than an outstanding share that embodies a
conditional obligation, that the issuer must or may settle by issuing a variable number of its equity shares shall be classified
as a liability (or an asset in some circumstances) if, at inception, the monetary value of the obligation is based solely or predominantly
on any one of the following: (a) a fixed monetary amount known at inception (for example, a payable settleable with a variable
number of the issuer’s equity shares); (b) variations in something other than the fair value of the issuer’s equity
shares (for example, a financial instrument indexed to the Standard and Poor’s S&P 500 Index and settleable with a variable
number of the issuer’s equity shares); or (c) variations inversely related to changes in the fair value of the issuer’s
equity shares (for example, a written put option that could be net share settled). Hybrid instruments meeting these criteria are
not further evaluated for any embedded derivatives, and are carried as a liability at fair value at each balance sheet date with
remeasurements reported in interest expense in the accompanying consolidated statements of operations and comprehensive loss.



Warrants Issued in Connection with Financings



We generally account for warrants issued in
connection with debt and equity financings as a component of equity, unless the warrants include a conditional obligation to issue
a variable number of shares or there is a deemed possibility that we may need to settle the warrants in cash.



For warrants where there is a possibility that
we may have to settle the warrants in cash, we estimate the fair value of the issued warrants as a liability at each reporting
date and record changes in the estimated fair value as a non-cash gain or loss in the consolidated statements of operations and
comprehensive loss. The fair values of these warrants have been determined using the Binomial Lattice model (“Lattice”)
and the Black-Scholes Option Pricing model. The Lattice model provides for assumptions regarding volatility, call and put features
and risk-free interest rates within the total period to maturity. The Black-Scholes Model requires inputs, such as the expected
term of the warrants, expected volatility and risk-free interest rate. These values are subject to a significant degree of judgment
on our part. The Company’s common stock price represents a significant input that affects the valuation of the warrants.



Business Combinations



We account for business combinations under
the acquisition method of accounting in accordance with ASC 805, Business Combinations, where the total purchase price is
allocated to the tangible and identified intangible assets acquired and liabilities assumed based on their estimated fair values.
The purchase price is allocated using the information currently available, and may be adjusted, up to one-year from the acquisition
date, after obtaining more information regarding, among other things, asset valuations, liabilities assumed and revisions to preliminary
estimates.



Contingent consideration, if any, is recorded
at the acquisition date based upon the estimated fair value of the contingent payments. The fair value of the contingent consideration
is re-measured each reporting period with any adjustments in fair value being recognized in loss from operations.



The purchase price in excess of the fair value
of the tangible and identified intangible assets acquired less liabilities assumed is recognized as goodwill.



Going Concern



We assess our ability to continue as a going
concern at every interim and annual period in accordance with ASC 205-40. The accompanying consolidated financial statements have
been prepared assuming that the Company will continue as a going concern. The ability to meet our obligations as they come due
and the attainment of sustainable profitability and positive cash flow from operations is dependent on certain future events. These
conditions raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do
not include any adjustments that might result from the outcome of this uncertainty. We evaluate whether it is probable that our
plans to mitigate those conditions will alleviate that substantial doubt at every interim and annual period and disclose the conditions
giving rise to substantial doubt and the results of our evaluation.



32







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



Deferred Rent



Deferred rent consists of the difference between
cash payments and the recognition of rent expense on a straight-line basis over the life of the lease.



Revenue and Cost of Revenue Recognition



The Company recognizes revenue when the four
basic criteria of revenue recognition are met:



| | · | Persuasive evidence of an
arrangement exists. Customer contracts and purchase orders are generally used to determine the existence of an arrangement.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The transfer of technology
or products has been completed or services have been rendered. Evidence of shipment or customer acceptance, when applicable, is
used to verify delivery.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | The sales price is fixed or determinable. The Company assesses whether the cost is fixed or determinable based on the payment terms associated with the transaction and whether the sales price is subject to refund or adjustment.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Collectability is reasonably assured. The Company assesses collectability based primarily on the creditworthiness of the customer as determined by credit checks and analysis as well as the customer’s payment history.
| | - | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



When collaboration, other research arrangements,
and product sales include multiple-element revenue arrangements, we account for these transactions by determining the elements,
or deliverables, included in the arrangement and determining which deliverables are separable for accounting purposes. We consider
delivered items to be separable if the delivered item(s) have stand-alone value to the customer and delivery or performance of
the undelivered item is considered probable and substantially in control of the vendor.



Medical Device Revenue and Cost of Revenue Recognition



The Company builds medical device robotic exoskeletons
for sale and capitalizes into inventory materials, direct and indirect labor and overhead in connection with manufacture and assembly
of these units.



When the Company brought its first version
medical device to market in 2012, the Company could not be certain as to the costs it would incur to support, maintain, service,
and upgrade these early stage devices. Primarily for this reason, prior to January 1, 2016, the sale of a device, associated software,
initial training, and extended support and maintenance were deemed as a single unit of accounting due to the uncertainty of the
Company’s follow-up maintenance and upgrade expenses, which were forecast to extend over three years. Accordingly, the revenue
from the sales of the device and associated cost of revenue were deferred at the time of shipment. Upon completion of training,
the amount of the arrangements were recognized as revenue and cost of revenue over a three year period on a straight line basis,
while all service expenses, whether or not covered by the Company’s original warranty, extended warranty contracts, or neither,
were recognized as incurred.



Effective January 1, 2016, the Company determined
it had established (i) separate individual pricing for training, extended warranty coverage, and out-of-contract service or repairs,
(ii) sufficient historical evidence of customer buying patterns for extended warranty and maintenance coverage, and (iii) a basis
for estimating and recording warranty and service costs to allow the Company to separate its multiple element arrangements into
two distinct units of accounting: (1) the device, associated software, original manufacturer warranty and training if required,
and (2) extended support and maintenance. As a result, in the first quarter of 2016, the Company began to recognize revenue related
to its sales transactions on a multiple element approach in which revenue is recognized upon the delivery of the separate elements
to the customer. Revenue relating to the undelivered elements is deferred using the relative selling price method, which allocates
revenue to each element using the estimated selling prices for the deliverables when vendor-specific objective evidence or third-party
evidence is not available. For sales on or after January 1, 2016, revenue and associated cost of revenue of medical devices is
recognized when delivered, or training has been completed, if required. Revenue for extended maintenance and support agreements
is recognized on a straight line basis over the contractual term of the agreement, which typically ranges from one to four years.
As a result of this change, the Company recognized medical device revenue previously deferred at December 31, 2015 of $6,517 and
associated cost of revenue of $4,159, resulting in additional gross profit, reduction in net loss from operations, and reduction
of net loss applicable to common stockholders of $2,358, or $0.13 per share, in its results of operations for the year ended December
31, 2016.  In addition, the Company recorded $212 for warranty expenses and a one-time charge of $911 for a planned preventative
maintenance and upgrade program associated with the devices it had sold prior to 2016 in the same time period.



33







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



Industrial Sales Revenue and Cost of
Revenue



The Company builds industrial exoskeletons
for sale and capitalizes into inventory materials, direct and indirect labor, and overhead in connection with the manufacture and
assembly of these units. No right of return exists on sales of industrial exoskeletons. We assess collectability at the time of
the sale and if collectability is not reasonably assured, the sale is deferred and not recognized until collectability is probable
or payment is received.  Typically, where product is produced and sold in the same country, title and risk of ownership
transfer when the product is shipped.  Products that are exported from a country for sale typically pass title and risk
of ownership at the border of the destination country. Because our industrial products are produced in the U.S., title and risk
of ownership generally transfer when the product is shipped, if shipped to a customer in the U.S. If we sell products to customers
outside the U.S., title and risk of ownership is generally transferred at the border of the destination country.



Engineering Services Revenue and Cost of Revenue



Collaborative arrangements typically consist
of cost reimbursements for specific engineering and development spending, and future product royalty payments. Cost reimbursements
for engineering and development spending are recognized as the related project labor hours are incurred in relation to all labor
hours and when collectability is reasonably assured. Amounts received in advance are recorded as deferred revenue until the technology
is transferred, services are rendered, or milestones are reached. Product royalty payments are recorded when earned under the arrangement.



Government grants, which support the Company’s
research efforts in specific projects, generally provide for reimbursement of approved costs as defined in the notices of grant
awards. Grant revenue is recognized as the associated project labor hours are incurred in relation to total labor hours. There
are some grants, such as the National Science Foundation grants, of which the Company draws upon and spends based on budgets preapproved
by the grantor.



The cost of engineering services revenue includes
payroll and benefits, subcontractor expenses and materials. All costs related to engineering services are expensed as incurred
and reported as cost of revenue.



Deferred Revenues



In connection with the Company’s medical
device sales and research services, the Company often receives cash payments before its earnings process is complete. In these
instances, the Company records the payments as customer deposits until a device is shipped to the customer, or as customer advances
in the case of research services until the earnings process is achieved. In both cases, the cash received is recorded as a component
of deferred revenue.



Deferred revenues and deferred cost of revenues consisted of the
following:



|                                          |  | December 31, |      
|----------------------------------------- |  | ------------ | -----
|                                          |  | 2016         |      
|Customer deposits and advances            |  | $            | 47   
|Deferred medical device revenues          |  |              | -    
|Deferred rental income                    |  |              | 60   
|Deferred extended maintenance and support |  |              | 1,523
|Total deferred revenues                   |  |              | 1,630
|Less current portion                      |  |              | (825 
|Deferred revenues, non-current            |  | $            | 805  
|                                          |  |              |      
|Deferred medical device unit costs        |  | $            | -    
|Less current portion                      |  |              | -    
|Deferred cost of revenue, non-current     |  | $            | -    



34







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



Research and Development



Research and development costs consist of costs
incurred for internal research and development activities. These costs primarily include salaries and other personnel-related expenses,
contractor fees, facility costs, supplies, and depreciation of equipment associated with the design and development of new products
prior to the establishment of their technological feasibility. Such costs are expensed as incurred.



Advertising Costs



Advertising costs are recorded in sales and
marketing expense as incurred. Advertising expense was $104, $25, and $1 for the years ended December 31, 2016, 2015, and 2014,
respectively.



Income Taxes



The Company accounts for income taxes using
the asset and liability method. Under this method, income tax expense or benefit is recognized for the amount of taxes payable
or refundable for the current year and for deferred tax liabilities and assets for the future tax consequences of events that have
been recognized in the Company’s consolidated financial statements or tax returns. The Company accounts for any income tax contingencies
in accordance with accounting guidance for income taxes. The measurement of current and deferred tax assets and liabilities is
based on provisions of currently enacted tax laws. The effects of any future changes in tax laws or rates have not been considered.



For the preparation of the Company’s consolidated
financial statements included herein, the Company estimates its income taxes and tax contingencies in each of the tax jurisdictions
in which it operates prior to the completion and filing of its tax returns. This process involves estimating actual current tax
expense together with assessing temporary differences resulting from differing treatment of items, such as deferred revenue, for
tax and accounting purposes. These differences result in net deferred tax assets and liabilities. The Company must then assess
the likelihood that the deferred tax assets will be realizable, and to the extent they believe that realizability is not likely,
the Company must establish a valuation allowance. In assessing the need for any additional valuation allowance, the Company considers
all the evidence available to it, both positive and negative, including historical levels of income, legislative developments,
expectations and risks associated with estimates of future taxable income, and ongoing prudent and feasible tax planning strategies.



Stock-based Compensation



The Company measures stock-based compensation
expense for all stock-based awards made to employees and directors based on the estimated fair value of the award on the date of
grant using the Black-Scholes option pricing model and recognizes the fair value on a straight-line basis over the requisite service
periods of the awards. Stock-based awards made to non-employees are measured and recognized based on the estimated fair value on
the vesting date and are re-measured at each reporting period.



35







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



The Company’s determination of the fair
value of stock-based awards on the date of grant using the Black-Scholes option pricing model is affected by the Company’s
stock price as well as assumptions regarding a number of highly complex and subjective variables. These variables include, but
are not limited to the Company’s expected stock price volatility over the term of the awards, and actual and projected employee
stock option exercise behaviors. Because there is insufficient information available to estimate the expected term of the stock-based
awards, the Company adopted the simplified method of estimating the expected term pursuant to SEC Staff Accounting Bulletin Topic
14. On this basis, the Company estimated the expected term of options granted by taking the average of the vesting term and the
contractual term of the option.



The Company has, from time to time, modified
the terms of its stock options to employees. The Company accounts for the incremental increase in the fair value over the original
award on the date of the modification as an expense for vested awards or over the remaining service (vesting) period for unvested
awards. The incremental compensation

cost is the excess of the fair value of the
modified award on the date of modification over the fair value of the original award immediately before the modification.



Net Loss Per Share of Common Stock



Basic net loss per share of common stock is
computed using the weighted average number of shares of common stock outstanding during the period. Diluted net loss per share
is computed using the weighted average number of common stock, adjusted to include conversion of certain stock options and warrants
for common stock during the period, as follows:



|                                                       |  | Years ended December 31, |        
|------------------------------------------------------ |  | ------------------------ | -------
|                                                       |  | 2016(1)                  |        
|Numerator:                                             |  |                          |        
|                                                       |  |                          |        
|Net loss applicable to common stockholders             |  | $                        | (33,815
|Adjustment for gain on fair value of warrant liability |  |                          | (4,286 
|Adjusted net loss used for dilution calculation        |  | $                        | (38,101
|                                                       |  |                          |        
|Denominator                                            |  |                          |        
|Weighted-average number of shares outstanding          |  |                          | 18,126 
|Effect of potential dilutive shares                    |  |                          | 496    
|Dilutive weighted-average number of shares outstanding |  |                          | 18,622 
|                                                       |  |                          |        
|Net loss per share applicable to common stockholders   |  |                          |        
|Basic                                                  |  | $                        | (1.87  
|Diluted                                                |  | $                        | (2.05  



| | (1) | Recognition of previously
deferred revenue and cost of goods in the year ended December 31, 2016 reduced net loss applicable to common stockholders by $2,358,
or $0.13 per share (see Note 2. Basis of Presentation and Summary of Significant Accounting Policies and Estimates –
Medical Device Revenue and Cost of Revenue Recognition).
| | --- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The following potential dilutive securities
were excluded from the computation of diluted net loss per share because including them would have been anti-dilutive:



|                                                          |  | Years ended December 31, |      
|--------------------------------------------------------- |  | ------------------------ | -----
|                                                          |  | 2016                     |      
|Options to purchase common stock                          |  |                          | 2,477
|Warrants for common stock                                 |  |                          | 1,963
|Common stock issuable upon conversion of preferred shares |  |                          | -    
|Total common stock equivalents                            |  |                          | 4,440



36







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



Recent Accounting Pronouncements



In August 2014, the Financial Accounting Standards
Board (“FASB”) issued Accounting Standards Update (“ASU”) 2014-15, Presentation of Financial Statements
– Going Concern. Under ASU No. 2014-15, an entity’s management is required to evaluate whether there are conditions
or events, considered in the aggregate, that raise substantial doubt about an entity’s ability to continue as a going concern
within one year after the date that financial statements are issued (or within one year after the date that the financial statements
are available to be issued when applicable). If such conditions are identified, management is to consider whether its plans that
are intended to mitigate those relevant conditions or events will alleviate the substantial doubt, with the findings disclosed
in the financial statements of the entity. ASU No. 2014-15 is effective for the annual period ending after December 15, 2016, and
for annual periods and interim periods thereafter. The Company adopted this standard during the year ended December 31, 2016. See
Note 1 for our current disclosure about our ability to continue as a going concern.



In May 2014, the FASB issued ASU No. 2014-09,
Revenue from Contracts with Customers. The updated standard will replace most existing revenue recognition guidance in U.S.
GAAP when it becomes effective and permits the use of either the retrospective or cumulative effect transition method. In August
2015, the FASB issued an update, ASU No. 2015-14, Revenue from Contracts with Customers (Topic 606): Deferral of the Effective
Date, to defer the effective date of this update by one year. In April 2016, the FASB issued a further update, ASU 2016-10 Revenue
from Contracts with Customers (Topic 606) Identifying Performance Obligations and Licensing. ASU 2016-10 clarifies that contractual
provisions that explicitly or implicitly require an entity to transfer control of additional goods or services to a customer should
be distinguished from contractual provisions that explicitly or implicitly define the attributes of a single promised license.
In May 2016, the FASB issued a further update, ASU 2016-12 Revenue from Contracts with Customers (Topic 606) Narrow-Scope Improvements
and Practical Expedients. ASU 2016-12 clarifies key areas concerning: (1) assessment of collectability, (2) presentation of sales
taxes and other similar taxes collected from customers, (3) non-cash consideration, (4) contract modifications at transition, (5)
completed contracts at transition, and (6) disclosing the accounting change in the period of adoption. The updated standard becomes
effective for the Company in the first quarter of fiscal year 2018, but allows the Company to adopt the standard one year earlier
if it so chooses. The Company has not yet selected a transition method and is currently evaluating the effect that the updated
standard will have on its consolidated financial statements and related disclosures.



In April 2015, the FASB issued ASU No.
2015-03, Simplifying the Presentation of Debt Issuance Costs, which requires companies to present debt financing costs as
a direct deduction from the carrying amount of the associated debt liability rather than as an asset, consistent with the presentation
of debt discounts on the consolidated balance sheets. The new standard became effective for the Company beginning on January 1,
2016. The Company adopted this standard for the year ended December 31, 2016. This adoption resulted in a reclassification of $95 in
debt issuance costs, net of accumulated amortization, from an asset to a reduction to associated debt liabilities as of December 31, 2016.



In July 2015, the FASB issued ASU 2015-11,
Simplifying the Measurement of Inventory, which requires entities to measure inventory at the lower of cost or net realizable
value. Net realizable value is defined as the estimated selling price in the ordinary course of business, less reasonably predictable
costs of completion, disposal and transportation. ASU 2015-11 will be effective for the Company during the first quarter of fiscal
year 2017 and must be applied on a prospective basis. Early adoption is permitted. The Company does not anticipate the adoption
of this guidance will have a material impact on our financial position, results of operations, or cash flows.



In February 2016, the FASB issued ASU No. 2016-02,
Leases (Topic 842) which will require lessees to recognize assets and liabilities for leases with lease terms of more than
12 months. For finance leases, a lessee is required to: (1) recognize a right-of-use asset and a lease liability, initially measured
at  the present value of the lease payments, in the statement of financial position, (2) recognize interest on the lease liability
separately from amortization of the right-of-use asset in the statement of comprehensive income, and (3) classify repayments of
the principal portion of the lease liability within financing activities and payments of interest on the lease liability and variable
lease payments within operating activities in the statement of cash flows. For operating leases, a lessee is required to: (1) recognize
a right-of-use asset and a lease liability, initially measured at the present value of the lease payments, in the statement
of financial position, (2) recognize a single lease cost, calculated so that the cost of the lease is allocated over the lease
term on a generally straight-line basis, and (3) classify all cash payments within operating activities in the statement of cash
flows. The new guidance is effective for fiscal years beginning after December 15, 2018.  The Company is evaluating the impact
that ASU 2016-02 will have on its consolidated financial statements and related disclosures.



37







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



In March 2016, the FASB issued ASU 2016-09 Compensation
– Stock Compensation (Topic 718) Improvements to Employee Share-Based Payment Accounting. ASU 2016-09 simplifies several
aspects of the accounting for share-based payment award transactions for public companies, including: (1) income tax consequences,
(2) classification of awards as either equity or liabilities, and (3) classification on the statement of cash flows. The amendments
in this update are effective for annual periods beginning after December 15, 2016. Upon adoption of ASU 2016-09 in the first quarter
of fiscal year 2017, the Company has elected to change its accounting policy to account for forfeitures as they occur so as to
more closely align compensation expense to services provided. The change will be applied on a modified retrospective basis with
a cumulative effect adjustment to retained earnings as of January 1, 2017.



In August 2016, the FASB issued ASU No. 2016-15, Classification
of Certain Cash Receipts and Cash Payments. ASU 2016-15 requires entities to adhere to a uniform classification and presentation
of certain cash receipts and cash payments in the statement of cash flows. The amendments in this update provide guidance on eight
specific cash flow issues. The new standard will be effective for the Company beginning on January 1, 2018 and early adoption is
permitted. The Company does not expect the impact of the items identified in the ASU to be material on its consolidated financial
statements.



3. 2014 Merger, Offering, and Other Related Transactions



Holdings was incorporated in the State of Nevada
on January 30, 2012, as a distributor of medical supplies and equipment to municipalities, hospitals, pharmacies, care centers,
and clinics in Chile. At the time of the Merger, Holdings was a “shell company” as defined in Rule 12b-2 of the Exchange
Act. Holdings’ fiscal year end was previously March 31, but was changed to December 31 in connection with the Merger.



On January 15, 2014, Holdings and a newly formed
wholly-owned subsidiary of Holdings, Ekso Acquisition Corp. (“Acquisition Sub”), entered into an Agreement and Plan
of Merger and Reorganization (the “Merger Agreement”) with Ekso Bionics. Under the Merger Agreement, Acquisition Sub
merged with and into Ekso Bionics, with Ekso Bionics remaining as the surviving corporation and with the stockholders of Ekso Bionics
exchanging all of their common stock, preferred stock and warrants to purchase preferred stock issued and outstanding immediately
prior to the closing of the Merger into an aggregate of 6,088 shares of Holdings’ common stock and warrants to purchase 89
shares of common stock. In addition, options to purchase 713 shares of common stock of Ekso Bionics were converted into options
to purchase 1,086 shares of common stock of Holdings. These shares are in addition to 754 outstanding shares of Holdings common
stock held by certain pre-Merger stockholders of Holdings, consisting of 643 shares held by such stockholders prior to the Merger
and an additional 111 shares issued to such stockholders pursuant to a provision in the Merger Agreement requiring the Company
to issue a number of shares such that the aggregate ownership of the pre-Merger stockholders (not including any shares of common
stock purchased by them in the private placement offering described below) remained approximately 6.8% of the outstanding common
stock of the Company following the Merger.



Upon the closing of the Merger, under the terms
of a split-off agreement and a general release agreement, Holdings transferred all of its pre-Merger operating assets and liabilities
to a newly formed wholly-owned special-purpose subsidiary (“Split-Off Subsidiary”), and transferred all of the outstanding
shares of capital stock of Split-Off Subsidiary to two individuals who were the pre-Merger majority stockholders of Holdings and
Holdings’ former officers and sole director (the “Split-Off”), in consideration of and in exchange for (a) the
surrender and cancellation of an aggregate of all shares of Holdings’ common stock held by such individuals (which were cancelled
and resumed the status of authorized but unissued shares of the Company’s common stock) and (b) certain representations,
covenants and indemnities.



Accounting for Reverse Merger



Ekso Bionics, as the accounting acquirer, recorded
the Merger as the issuance of stock for the net monetary assets of Holdings accompanied by a recapitalization. This accounting
was identical to that resulting from a reverse merger, except that no goodwill or intangible assets were recorded. The historical
financial statements of Holdings before the Merger have been replaced with the historical financial statements of Ekso Bionics
before the Merger in filings with the SEC subsequent to the Merger, including this filing. The Merger was intended to be treated
as a tax-free exchange under Section 368(a) of the Internal Revenue Code of 1986, as amended.



38







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



Retroactive Conversion of all Share and
Per Share Amounts



In accordance with reverse merger accounting
guidance, amounts for Ekso Bionics’ historical (pre-merger) common stock, preferred stock and warrants and options to purchase
common stock including share and per share amounts have been retroactively adjusted using their respective exchange ratios in these
financial statements, except for the pre-Merger amounts shown in the consolidated statement of stockholders’ equity (deficit)
or unless otherwise disclosed. The conversion ratios were 1.5238, 1.6290, 1.9548 and 1.9548 for shares of common stock, Series
A preferred stock, Series A-2 preferred stock and Series B preferred stock, respectively.



Repayment of 2013 Bridge Note



In November 2013, in anticipation of the Merger
and related private placement offering, Ekso Bionics completed a private placement to accredited investors of $5,000 of its senior
subordinated secured convertible notes (the “2013 Bridge Notes”). Upon the closing of the Merger and the private placement
offering described below, the $5,000 in outstanding principal and $83 of accrued interest of the 2013 Bridge Notes automatically
converted into 714 Units (as defined below), and investors in the 2013 Bridge Notes received warrants to purchase 357 shares of
common stock at an exercise price of $7.00 per share for a term of three years (the “Bridge Warrants”). The Bridge
Warrants had weighted average anti-dilution protection, subject to customary exceptions.



Private Placement Offering



Concurrently with the closing of the Merger
and in contemplation of the Merger, the Company held a closing of a private placement offering (the “PPO”) in which
it sold 2,940 Units at a purchase price of $7.00 per Unit, with each Unit consisting of one share of common stock plus a warrant
(the “PPO Warrants”) to purchase an additional share of common stock of the Company at $14.00 per share with a five
year term (the “Units”). Included in the initial Unit sales were 714 Units that were issued upon conversion of the
2013 Bridge Notes mentioned above. Between January 29, 2014 and February 6, 2014, the Company issued an additional 1,389 Units
in subsequent closings of the PPO. As a result of issuing a total of 4,329 Units: (a) the Company received gross proceeds of $25,300,
(b) $5,083 of debt and accrued interest attributable to the 2013 Bridge Notes was settled with the issuance of 714 Units, (c) a
net of $2,553 of the Company’s then senior note payable was paid off, and (d) the Company incurred offering costs of $3,338.



Investors in the Units had weighted average
anti-dilution protection with respect to the shares of common stock included in the Units if within 24 months after the final closing
of the PPO the Company issued additional shares of common stock or common stock equivalents (subject to customary exceptions, including
but not limited to issuances of awards under the Company’s 2014 Equity Incentive Plan) for consideration per share less than
$7.00. The PPO Warrants had weighted average anti-dilution protection, subject to customary exceptions.



In connection with the conversion of the 2013
Bridge Notes and the PPO, the placement agent for the PPO and its sub-agents were paid an aggregate commission of $3,030 and were
issued warrants to purchase an aggregate of 71 shares of the Company’s common stock, with an exercise price per share of
$7.00 and a term of five years (“Bridge Agent Warrants”) and warrants to purchase an aggregate of 357 shares of common
stock with a term of five years and an exercise price of $7.00 per share (the “PPO Agent Warrants”). The Bridge Agent
Warrants and PPO Agent Warrants had weighted average anti-dilution protection, subject to customary exceptions.



Offer to Amend and Exercise



In November 2014, the Company consummated an
offer to amend and exercise (the “Offer to Amend and Exercise”) its PPO Warrants at a temporarily reduced exercise
price. Pursuant to the Offer to Amend and Exercise, an aggregate of 3,251 PPO Warrants were tendered by their holders and were
amended to reduce the exercise price from $14.00 to $7.00 per share of common stock, and to restrict the ability of the holder
of shares issuable upon exercise of the amended warrants to sell, make any short sale of, loan, grant any option for the purchase
of, or otherwise dispose of any of such shares without the prior written consent of the Company for a period of 50 days from November
20, 2014.



39







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



In connection with the Offer to Amend and Exercise,
the holders of a majority of the then outstanding PPO Warrants, Bridge Warrants, PPO Agent Warrants and Bridge Agent Warrants approved
an amendment to remove the price-based anti-dilution provisions in those warrants (see Note 13, Capitalization and Equity Structure
– 2014 PPO and Merger Warrants).



2014 Equity Incentive Plan



Before the Merger, the Board of Directors adopted,
and the stockholders approved, the 2014 Equity Incentive Plan, which provided for the issuance of incentive awards constituting
up to 2,058 shares of common stock to officers, key employees, consultants and directors. In connection with the Merger, options
to purchase Ekso Bionics common stock outstanding immediately prior to the Merger were converted into options to purchase an aggregate
of 1,086 shares of Holdings issued under the 2014 Equity Incentive Plan. On the closing of the Merger, the Board granted to officers
and directors options to purchase an aggregate of 329 shares of common stock under the 2014 Equity Incentive Plan.



Subsequent to the Merger, on June 10, 2015,
the Board submitted to the stockholders and the stockholders approved an amendment of the 2014 Plan to increase the maximum number
of shares of common stock that may be issued under the Amended and Restated 2014 Equity Incentive Plan (the “2014 Plan”)
by 1,656 shares to 3,714 shares.



4. Equipois Acquisition



On December 1, 2015, the Company acquired substantially
all of the assets of Equipois, LLC, a New Hampshire limited liability company (“Equipois”), for an initial payment
of approximately $1.1 million of the Company’s common stock pursuant to an asset purchase agreement among the Company, Ekso
Bionics, Inc., Equipois and Allard Nazarian Group, Inc. ( the “Asset Purchase Agreement”). The Company will make additional
payments in shares of the Company’s common stock or cash upon the achievement of certain financial targets for the period
from January 1, 2016 through December 31, 2018.



The Company accounted for the acquisition as
a business combination by applying the acquisition method, and accordingly, the purchase price of $1,839 was allocated to the assets
assumed based on their fair values at the acquisition date. The excess of the purchase price over the assets of $189 was recorded
as goodwill. The goodwill recognized is attributed primarily to expected synergies of Equipois with the Company. From the acquisition
date and as of December 31, 2016, there were no changes in the recognized amounts of goodwill resulting from the acquisition.
For the year ended December 31, 2015, the Company did not recognize any revenue related to the Equipois acquisition.



The acquired assets consist of mechanical balance
and support arms technologies, including the rights to the zeroG® and X-Ar® products. The acquired assets were integral
to the Equipois business and include patents, trademarks and other intellectual property rights as well as certain tools and product
designs and specifications.  The Company also assumed the rights and obligations of Equipois under certain intellectual property
license agreements.  The Company did not assume any other obligations of Equipois.



The total purchase price is summarized as follows:



|                                   |  | Amount |      
|---------------------------------- |  | ------ | -----
|Stock consideration (112 shares)   |  | $      | 1,071
|Estimated contingent consideration |  |        | 768  
|Total purchase price               |  | $      | 1,839



The fair value of the 112 shares of common stock issued was determined
based on the closing market price of the Company’s common shares on the acquisition date.



40







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



In connection with the acquisition, the parties
entered into a supply agreement pursuant to which Equipois supplied products to the Company during a post-closing transition period
expiring December 31, 2016 (the “Supply Agreement”), and a reseller agreement pursuant to which Equipois may purchase
and resell the products to certain current Equipois customers for a three-year term (the “Reseller Agreement”). Under
the Supply Agreement, the Company was obligated to make a minimum purchase of $157 and a maximum purchase of $521.



The fair value of the contingent consideration
resulting from the Supply Agreement and Reseller Agreement was recorded at the time of acquisition. The Supply Agreement required
the Company to pay $500 in additional shares of the Company’s common stock on December 31, 2016. In addition, the Reseller
Agreement requires the Company to pay an annual contingent consideration payment of between $125 and $375 in shares of the Company’s
common stock if the Company and Equipois meet certain product sales targets for each of the calendar years 2016, 2017 and 2018. 
Upon the termination of the Reseller Agreement by the Company without cause, the Company will pay to Equipois a final contingent
consideration payment, payable in shares of the Company’s common stock, such that the total consideration received by Equipois
under the Asset Purchase Agreement, including the shares issued upon closing, the additional shares issued upon termination of
the Supply Agreement and the annual contingent consideration payments are not less than the sum  of (a) 7.5 multiplied by
10% of specified product revenues of Equipois during the preceding four complete quarters, plus (b) 7.5 multiplied by 5% of specified
product revenues of the Company during the preceding four complete quarters.



The Asset Purchase Agreement also provides
for the election of a buyout payment by either the Company or Equipois which is payable in shares of the Company’s common
stock. Upon the election of the buyout payment by either party, the Reseller Agreement is terminated and the buyout payment will
be considered in lieu of any further annual or final earn-out payments. The buyout payment ranges from total consideration of $1,750
to $3,000 and is based on the timing of the election and whether it is Equipois or the Company who makes the election. The buyout
payment provision expires on November 30, 2017.



The contingent consideration is valued using
the Probability Weighted Value Analysis which considered performance based contingent payments for both the supply and sales functions
of the Company, and both buyer and seller options.



Multiple forecasted scenarios were evaluated
which include (i) a minimum payment case, (ii) an expected payment case and (iii) a maximum payment case. 
The Company determined the potential deferred payment cash flows of Equipois and the Company based on each scenario.  The
cash flow payments were converted to a present value using a discount rate of 15% based on the Company’s weighted average
cost of capital.  Finally, the Company probability weighted each scenario. The Company reviewed the assumptions used to value
the contingent consideration from the date of acquisition to December 31, 2015, and noted no change in the initial estimated fair
value of the contingent consideration. Any changes in the fair value of this contingent consideration liability are recognized
in loss from operations in the period of the change.



For the year ended December 31, 2016, the consideration
payout calculated includes the $500 in additional shares of the Company’s common stock related to the Supply Agreement and
the annual minimum of $125 under the Reseller Agreement. Due to the price floor of $7.00 per share in the number of shares of common
stock issuable to satisfy the payment amount, we reclassified $355 from the contingent consideration liability to accrued liabilities
as of December 31, 2016, to be paid in shares of common stock in the first quarter of 2017. The Company also recorded a non-cash
gain on the change in fair value of the remaining contingent consideration liability of $196 in the consolidated statement of operations
and comprehensive loss for the year ended December 31, 2016.



The following table summarizes the fair values of the assets acquired
as of the acquisition date:



|                                   |  | Amount |      
|---------------------------------- |  | ------ | -----
|Fixed assets                       |  | $      | 40   
|Intangible assets                  |  |        | 1,610
|Total identifiable assets acquired |  |        | 1,650
|Goodwill                           |  |        | 189  
|Net assets acquired                |  | $      | 1,839



41







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



The Company recorded $1,610 to intangible assets
as of the acquisition date and is amortizing the value of the technology, customer relationships and trade name over an estimated
useful life of 3 years.  Amortization expense related to the acquired intangible assets was $558 and $26 for the years ended
December 31, 2016, and 2015, respectively, and was included as a component of operating expenses in the consolidated statement
of operations and comprehensive loss. Of the $189 of goodwill, none was expected to be deductible for tax purposes.



Acquired intangible assets as of December 31, 2016 were as
follows:



|                       |  | Cost |       |  | Accumulated Amortization |   |      | Net |  |   | Estimated Useful Life
|---------------------- |  | ---- | ----- |  | ------------------------ | - | ---- | --- |  | - | ---------------------
|Developed technology   |  | $    | 1,160 |  |                          | $ | (421 | )   |  | $ | 739                  
|Customer relationships |  |      | 70    |  |                          |   | (25  | )   |  |   | 45                   
|Customer trade name    |  |      | 380   |  |                          |   | (138 | )   |  |   | 242                  
|                       |  | $    | 1,610 |  |                          | $ | (584 | )   |  | $ | 1,026                



The estimated future aggregate amortization
expense is $537 and $489 for the years ended December 31, 2017 and 2018, respectively.



Pro Forma



The following unaudited pro forma financial
information reflects the Company’s consolidated statement of operations as if the acquisition of Equipois had taken place
on January 1, 2014. The pro forma information includes adjustments for royalty revenue, impact from the Supply Agreement,
and the amortization of intangible assets. The pro forma financial information is not necessarily indicative of the results of
operations as they would have been had the transaction been effected on the assumed date.



|         |  | Years ended December 31 |        
|-------- |  | ----------------------- | -------
|         |  | 2015                    |        
|Revenue  |  | $                       | 9,434  
|Net loss |  | $                       | (19,590



5. Fair Value Measurements



Fair value is defined as the exchange price
that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market
for the asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques
used to measure fair value must maximize the use of observable inputs and minimize the use of unobservable inputs. Three levels
of inputs, of which the first two are considered observable and the last unobservable, may be used to measure fair value which
are the following:



| | · | Level 1—Quoted
prices in active markets for identical assets or liabilities. The Company considers a market to be active when transactions for
the asset occur with sufficient frequency and volume to provide pricing information on an ongoing basis.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Level 2—Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Level 3—Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. The valuation of Level 3 investments requires the use of significant management judgments or estimation.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



42







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



The Company’s fair value hierarchies for its financial assets
and liabilities which require fair value measurement on a recurring basis are as follows:



|                                   |  |       |       |  | Quoted Prices in Active Markets For Identical Items |   |   | Significant Other Observable Inputs |  |   | Significant Unobservable Inputs | 
|---------------------------------- |  | ----- | ----- |  | --------------------------------------------------- | - | - | ----------------------------------- |  | - | ------------------------------- | 
|                                   |  | Total |       |  | (Level 1)                                           |   |   | (Level 2)                           |  |   | (Level 3)                       | 
|December 31, 2016                  |  |       |       |  |                                                     |   |   |                                     |  |   |                                 | 
|Liabilities                        |  |       |       |  |                                                     |   |   |                                     |  |   |                                 | 
|Warrant liability                  |  | $     | 3,546 |  |                                                     | $ | - |                                     |  | $ | -                               | 
|Contingent consideration liability |  | $     | 217   |  |                                                     | $ | - |                                     |  | $ | -                               | 
|Contingent success fee liability   |  | $     | 116   |  |                                                     | $ | - |                                     |  | $ | -                               | 
|                                   |  |       |       |  |                                                     |   |   |                                     |  |   |                                 | 
|December 31, 2015                  |  |       |       |  |                                                     |   |   |                                     |  |   |                                 | 
|Liabilities                        |  |       |       |  |                                                     |   |   |                                     |  |   |                                 | 
|Warrant liability                  |  | $     | 9,195 |  |                                                     | $ | - |                                     |  | $ | -                               | 
|Contingent consideration liability |  | $     | 768   |  |                                                     | $ | - |                                     |  | $ | -                               | 



During the years ended December 31, 2016 and
2015, there were no transfers between Level 1, Level 2, or Level 3 assets or liabilities reported at fair value on a recurring
basis and the valuation techniques used did not change compared to the Company’s established practice.



We measure our contingent consideration liability
at fair value at each reporting period using significant unobservable inputs classified within Level 3 of the fair value hierarchy.
We use a probability weighted value analysis as a valuation technique to convert future estimated cash flows to a single present
value amount. The significant unobservable inputs used in the fair value measurements are sales projections over the earn-out period,
and the probability outcome percentages assigned to each scenario. Significant increases or decreases to either of these inputs
in isolation would result in a significantly higher or lower liability with a higher liability capped by the contractual maximum
of the contingent earn-out obligation. Ultimately, the liability will be equivalent to the amount settled, and the difference between
the fair value estimate and amount settled will be recorded in earnings. The amount settled that is less than or equal to the liability
on the acquisition date is reflected as non-cash financing activities in our consolidated statements of cash flows. Any amount
settled in excess of the liability on the acquisition date is reflected as non-cash operating activities. Any changes in the estimated
fair value of our contingent consideration liabilities related to the time component of the present value calculation are reported
in interest expense. Adjustments to the estimated fair value related to changes in all other unobservable inputs are reported in
our statements of operations and comprehensive loss.



The following table sets forth a summary of
the changes in the fair value of Company’s Level 3 financial liabilities during the year ended December 31, 2016, which
were measured at fair value on a recurring basis:



|                                                                                                              |  | Warrant Liability |        |   | Contingent Consideration Liability |   |      | Contingent Success Fee Liability | 
|------------------------------------------------------------------------------------------------------------- |  | ----------------- | ------ | - | ---------------------------------- | - | ---- | -------------------------------- | 
|Balance at December 31, 2015                                                                                  |  | $                 | 9,195  |   |                                    | $ | 768  |                                  | 
|Reclassification of warrant liability to equity upon exercise of warrants                                     |  |                   | (1,363 | ) |                                    |   | -    |                                  | 
|Gain on decrease in fair value of warrants issued with 2015 financing                                         |  |                   | (4,286 | ) |                                    |   | -    |                                  | 
|Reclassification of contingent consideration liability to accrued liabilities                                 |  |                   | -      |   |                                    |   | (355 | )                                | 
|Gain on re-measurement of fair value of contingent consideration liability transferred to accrued liabilities |  |                   | -      |   |                                    |   | (196 | )                                | 
|Fair value of contingent success fee related to long-term debt                                                |  |                   |        |   |                                    |   |      |                                  | 
|Balance at December 31, 2016                                                                                  |  | $                 | 3,546  |   |                                    | $ | 217  |                                  | 



43







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



The warrants were valued at $9,195 at December
31, 2015. Due to a decrease in the Company’s common stock price from December 31, 2015 to December 31, 2016, and the removal
of the anti-dilution rights the fair value of the warrants decreased by $4,286, which resulted in a non-cash gain recorded in the
Company’s consolidated statements of operations and comprehensive loss for the year. See Note 13 in the notes to our consolidated
financial statements under the caption Capitalization and Equity Structure – 2015 Warrants for a description of the
warrants, including the method and inputs used to estimate their fair value.



6. Inventories, net



Inventories consist of the following:



|                        |  | December 31, |      
|----------------------- |  | ------------ | -----
|                        |  | 2016         |      
|Raw materials           |  | $            | 1,193
|Work in progress        |  |              | 198  
|Finished goods          |  |              | 267  
|                        |  |              | 1,658
|Less: inventory reserve |  |              | (102 
|Inventories, net        |  | $            | 1,556



7. Property and Equipment, net



Property and equipment, net consisted of the following:



|                                          |  | Estimated    |  | December 31, |       
|----------------------------------------- |  | ------------ |  | ------------ | ------
|                                          |  | Life (Years) |  | 2016         |       
|Machinery and equipment                   |  | 3-5          |  | $            | 3,432 
|Computers and peripherals                 |  | 3-7          |  |              | 564   
|Computer software                         |  | 3-5          |  |              | 547   
|Leasehold improvement                     |  | 5-10         |  |              | 625   
|Tools, molds, dies and jigs               |  | 5            |  |              | 50    
|Furniture, office and leased equipment    |  | 3-13         |  |              | 593   
|                                          |  |              |  |              | 5,811 
|Accumulated depreciation and amortization |  |              |  |              | (3,376
|Property and equipment, net               |  |              |  | $            | 2,435 



Depreciation and amortization expense, including
amortization of intangible assets, totaled $1,855, $933 and $745 for the years ended December 31, 2016, 2015, and 2014, respectively.



44







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



8. Accrued Liabilities



Accrued liabilities consisted of the following:



|                                        |  | December 31, |      
|--------------------------------------- |  | ------------ | -----
|                                        |  | 2016         |      
|Salaries, benefits and related expenses |  | $            | 2,349
|Maintenance                             |  |              | 483  
|Warranty expense                        |  |              | 203  
|Professional fees                       |  |              | 56   
|Equipois earn-out                       |  |              | 355  
|Other                                   |  |              | 110  
|Total                                   |  | $            | 3,556



Maintenance and Warranty



Sales of devices generally include an initial
warranty for parts and services for one year in the U.S. and two years in Europe, the Middle East, and Africa. During the year
ended December 31, 2016, the Company determined it had sufficient historical experience of warranty costs to estimate future warranty
costs for devices sold. As a result, and beginning during the year ended December 31, 2016, a liability for the estimated cost
of product warranty is established at the time revenue is recognized based on the historical experience of known product failure
rates and expected material and labor costs to provide warranty services. From time to time, specific additional warranty accruals
may be made if unforeseen technical problems arise. Alternatively, if estimates are determined to be greater than the actual amounts
necessary, a portion of the liability may be reversed in future periods. Warranty costs are reflected in the consolidated
statements of operations and comprehensive loss as a component of costs of revenue.



In addition, in the year ended December 31,
2016, the Company recorded in its consolidated statements of operations and comprehensive loss a one-time charge of $911 for a
preventative maintenance and improvement program for devices sold prior to 2016 to bring the devices to second generation GT-level
functionality.



|                                       |  | 2016        |     
|-------------------------------------- |  | ----------- | ----
|                                       |  | Maintenance |     
|Balance at December 31, 2015           |  | $           | -   
|Additions for estimated future expense |  |             | 911 
|Incurred costs                         |  |             | (428
|Balance at December 31, 2016           |  | $           | 483 
|                                       |  |             |     
|Current portion                        |  |             | 483 
|Long-term portion                      |  |             | -   
|Total                                  |  | $           | 483 



|                             |  | 2015        |  
|---------------------------- |  | ----------- | -
|                             |  | Maintenance |  
|Balance at December 31, 2014 |  | $           | -
|Incurred costs               |  |             | -
|Balance at December 31, 2015 |  | $           | -



45







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



9. Long-Term Debt



On December
30, 2016, the Company entered into a Loan and Security Agreement (the “Loan Agreement”) that provided up to $10,000
in total borrowings available for draw in two tranches of $7,000 (the “Term A Loan”) and $3,000 (the “Term B
Loan”, and together with the Term A Loan, the “Term Loans”), respectively. The Term A Loan was disbursed to the
Company on December 30, 2016. If the Company receives net cash proceeds of at least $15,000 in connection with the sale or issuance
of its equity securities, including in connection with the exercise of warrants, prior to December 31, 2017, the Company may request
on or prior to December 31, 2017, the Term B Loan so long as no event of default has occurred. Any amounts borrowed and repaid
may not be reborrowed. The Loan Agreement creates a first priority security interest with respect to substantially all assets of
the Company, including proceeds of intellectual property, but expressly excluding intellectual property itself.



Pursuant
to the Loan Agreement, the proceeds from the Term Loans may only be used for working capital purposes and to fund general business
requirements. The Term Loans will bear interest on the outstanding daily balance at a floating per annum rate equal to the 30 day
U.S. LIBOR rate plus 5.41%.



The
Company is required to pay accrued interest on the Term A Loan on the first day of each month through and including January 1,
2018 (or July 1, 2018, if the Term B Loan is drawn upon). Commencing on February 1, 2018 (or August 1, 2018, if the Term B Loan
is drawn upon), the Company is required make equal monthly payments of principal, together with accrued and unpaid interest. The
principal balance of the Term Loans amortizes ratably over 36 months (or 30 months, if the Term B Loan is drawn upon). The maturity
of the Term Loans is January 1, 2021, at which time all unpaid principal and accrued and unpaid interest shall be due and payable
in full. In addition, a final payment equal to 3.5% of the original principal amount will be due on the maturity date.



The
Company may elect to prepay a Term Loan at any time, in whole but not in part. If the Company prepays a Term Loan prior to December
30, 2017, it will owe a prepayment fee equal to 1.0% of the principal amount of such prepaid Term Loan. The prepayment fee is also
payable in connection with any acceleration of a Term Loan prior to December 30, 2017 following a default by the Company. In addition,
the Company is required to pay a fee in an amount equal to 3.5% of each Term Loan upon the earlier to occur of (a) acceleration
of such Term Loan following a default by the Company, (b) voluntary prepayment of such Term Loan by the Company and (c) the maturity
of such Term Loan.



The
Loan Agreement includes funding conditions, representations and warranties and covenants customary to similar credit facilities.
In addition, the Company agreed to a liquidity covenant requiring that it maintain unrestricted cash and cash equivalents in accounts
at Lender or subject to control agreements in favor of Lender in an amount equal to at least three months of “Monthly Cash
Burn,” which is the Company’s average monthly net income (loss) for the trailing six-month period plus certain expenses
and plus the average monthly principal due and payable on interest-bearing liabilities in the immediately succeeding three-month
period. Such amount was determined to be $6,206 as of January 31, 2017, the most current determination, with the amount subject
to change on a month-to-month basis. At December 31, 2016, with cash on hand of $16,846 we were in compliance with this and all
other covenants.



Events
of default which may cause repayment of the Term Loans to be accelerated include, among other customary events of default, (1)
non-payment of any obligation when due, (2) the Company’s failure to comply with its affirmative and negative covenants,
(3) the Company’s failure to perform any other obligation required under the Loan Agreement and to cure such default within
a 30 days after becoming aware of such failure, (4) the occurrence of a Material Adverse Effect, (5) the attachment or seizure
of a material portion of the Company’s assets if such attachment or seizure is not released, discharged or rescinded within
10 days, (6) bankruptcy or insolvency of the Company, (7) default by the Company under any agreement (i) resulting in a right by
a third party to accelerate indebtedness in an amount in excess of $250 or (ii) that would reasonably be expected to have a Material
Adverse Effect, (8) entry of a final, uninsured judgment or judgments against the Company for the payment of money in an amount,
individually or in the aggregate, of at least $250, or (9) any material misrepresentation or material misstatement with respect
to any warranty or representation set forth in the Loan Agreement.



On
December 30, 2016, pursuant to the Loan Agreement, the Company entered into a Success Fee Agreement with the Lender under which
the Company agreed to pay the Lender a $250 success fee upon the first to occur of any of the following events: (a) a sale or other
disposition by the Company of all or substantially all of its assets; (b) a merger or consolidation of the Company into or with
another person or entity, where the holders of the Company’s outstanding voting equity securities immediately prior to such
merger or consolidation hold less than a majority of the issued and outstanding voting equity securities of the successor or surviving
person or entity immediately following the consummation of such merger or consolidation; or (c) the closing price per share for
the Company’s common stock being $8.00 or more for five successive business days. The estimated fair value of
the success fee was determined using the Binomial Lattice Model and was recorded as a discount to the debt obligation. The fair
value of the contingent success fee is re-measured each reporting period with any adjustments in fair value being recognized in
loss from operations. The success fee is classified as a liability on the consolidated balance sheets. At December 31, 2016,
the carrying value of the contingent success fee liability was $116.



46







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



The final payment
fee, debt issuance costs, and fair value of the success fee combined with the stated interest result in an effective interest rate
of 6.27%. The final payment fee and debt issuance costs will be accreted and amortized, respectively, to interest expense using
the effective interest method over the life of the loan.



The following table presents scheduled principal payments of our
long-term debt as of December 31, 2016:



|Period                              |  | Amount |      
|----------------------------------- |  | ------ | -----
|2017                                |  | $      | -    
|2018                                |  |        | 2,139
|2019                                |  |        | 2,333
|2020                                |  |        | 2,333
|2021                                |  |        | 195  
|Total principal payments            |  |        | 7,000
|Less issuance costs & debt discount |  |        | 211  
|Long-term debt, net                 |  | $      | 6,789



10. Lease and Note Obligations



In November 2011, the Company entered into
an operating lease agreement for its headquarters and manufacturing facility in Richmond, California. The lease term commenced
in March 2012 and expires in May 2017, with one option to renew for an additional five years. In November 2016, the Company signed
the five-year lease extension option for its Richmond headquarters. The option lease term will commence in June 2017 and expire
in May 2022, which is included in the table below. The Company also leases nominal office space in Germany.



In 2012, the Company entered into a note agreement
in connection with the lease for its Richmond, California facility. The note, for an aggregate principal of $200, with an interest
rate of 7%, minimum monthly payments of $4, that matures on May 31, 2017, was used to fund leasehold improvements. This note is
classified as a component of capital lease obligation-current and other non-current liabilities in the consolidated balance sheets.



Commencing in August 2015, the Company entered
into a long-term capital lease obligation for equipment. The aggregate principal of the lease is $166, with an interest rate of
4.7%, minimum monthly payments of $3 and a July 1, 2020 maturity. This capital lease is classified as a component of capital lease
obligation-current in the consolidated balance sheets.



The Company estimates future minimum payments
as of December 31, 2016 to be the following:



|Period                         |  | Operating
 Leases |       |  | Note Payable |   |     | Capital Lease |  |   | Total
Minimum 
Payments |  
|------------------------------ |  | ----------------- | ----- |  | ------------ | - | --- | ------------- |  | - | ----------------------- | -
|2017                           |  | $                 | 461   |  |              | $ | 20  |               |  | $ | 40                      |  
|2018                           |  |                   | 483   |  |              |   | -   |               |  |   | 37                      |  
|2019                           |  |                   | 494   |  |              |   | -   |               |  |   | 37                      |  
|2020                           |  |                   | 504   |  |              |   | -   |               |  |   | 22                      |  
|2021                           |  |                   | 429   |  |              |   | -   |               |  |   | -                       |  
|Thereafter                     |  |                   | 181   |  |              |   | -   |               |  |   | -                       |  
|Total minimum payments         |  | $                 | 2,552 |  |              |   | 20  |               |  |   | 136                     |  
|Less interest                  |  |                   |       |  |              |   | (1  | )             |  |   | (11                     | )
|Present value minimum payments |  |                   |       |  |              |   | 19  |               |  |   | 125                     |  
|Less current portion           |  |                   |       |  |              |   | (19 | )             |  |   | (35                     | )
|Long-term portion              |  |                   |       |  |              | $ | -   |               |  | $ | 90                      |  



47







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



Rent expense under the Company’s operating
leases was $400, $342, and $343 for the years ended December 31, 2016, 2015, and 2014, respectively.



11. Employee Benefit Plan



The Company administers a 401(k) retirement
plan (the “401(k) Plan”) in which all employees are eligible to participate. Each eligible employee may elect to contribute
to the 401(k) Plan. During the years ended December 31, 2016 and 2015, the Company has made no matching contributions.



12. Related Party Transactions



The Company has license agreements and various
collaboration agreements (see Note 16, Commitments and Contingencies) with the Regents of the University of California,
Berkeley (“UCB”) and for which UCB received shares of common stock of the Company. As of the second quarter of 2015,
UCB no longer holds such shares. Total payments made to UCB for the years ended December 31, 2016, 2015, and 2014 were $146, $50,
and $391, respectively. As of December 31, 2016 and 2015, amounts payable to UCB amounted to $23 and $10, respectively.



13. Capitalization and Equity Structure



Reverse Stock Split



After the close of the stock market on May
4, 2016, the Company effected a 1-for-7 reverse split of its common stock. As a result, all common stock share amounts included
in this filing have been retroactively reduced by a factor of seven and all common stock per share amounts have been increased
by a factor of seven, with the exception of our common stock par value. Amounts affected include common stock outstanding, including
the issuance of new shares of common stock as a result of the conversion of preferred stock and the exercise of stock options and
warrants.



Summary



The Company’s authorized capital stock
at December 31, 2016 consisted of 71,429 shares of common stock and 10,000 shares of preferred stock. At December 31, 2016, 21,894
shares of common stock were issued and outstanding and no shares of preferred stock were issued and outstanding.



Common Stock



The holders of outstanding shares of common
stock are entitled to receive dividends out of assets or funds legally available for the payment of dividends at such times and
in such amounts as the Board of Directors from time to time may determine. Holders of common stock are entitled to one vote for
each share held on all matters submitted to a vote of stockholders. There is no cumulative voting for the election of directors.
The common stock is not entitled to pre-emptive rights and is not subject to conversion or redemption. Upon liquidation, dissolution
or winding up of the Company, the assets legally available for distribution to stockholders are distributable ratably among the
holders of the common stock after payment of liquidation preferences, if any, on any outstanding payment of other claims of creditors.
Each outstanding share of common stock is duly and validly issued, fully paid, and non-assessable.



48







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



2016 Common Stock Offering



On August 12, 2016, the Company issued 3,750
shares of common stock at a price to the public of $4.00, resulting in proceeds to the Company of $13,696, net of the underwriting
discount and issuance costs. On August 17, 2016, the Company issued an additional 267 shares of common stock as a result of the
partial exercise of the underwriters’ overallotment option for additional proceeds of $998, net of the underwriting discount.
The Company plans to use the proceeds from this offering for its operations.



As discussed below, the Series A Convertible
Preferred Stock issued in December 2015 (the “Preferred Shares”) and the common stock warrants issued in December 2015
(the “2015 Warrants”) included price-based anti-dilution provisions providing for the adjustment of the conversion
price and the exercise price, as applicable, in the event the Company sells common stock or common stock equivalents (subject to
exceptions for certain exempt issuances) at a price lower than the then-conversion price of the Preferred Shares or the then-exercise
price of the 2015 Warrants. Because the sale price to the underwriters of the common stock in the August 2016 common stock offering
was less than the then-conversion price of the Preferred Shares and the then-exercise price of the 2015 Warrants, there was an
anti-dilution adjustment to the number of shares of common stock issuable upon conversion of the Preferred Shares and the exercise
price of the 2015 Warrants was reduced, as discussed in more detail below.



Preferred Stock



The Company may issue shares of preferred stock
from time to time in one or more series, each of which will have such distinctive designation or title as shall be determined by
its Board of Directors and will have such voting powers, full or limited, or no voting powers, and such preferences and relative,
participating, optional or other special rights and such qualifications, limitations or restrictions thereof, as shall be stated
in such resolution or resolutions providing for the issue of such class or series of preferred stock as may be adopted from time
to time by the Board of Directors.



Convertible Preferred Stock



On December 23, 2015, the Company entered into
an agreement to issue 15 Preferred Shares and 2015 Warrants to purchase 2,122 shares of the Company’s common stock for which
the Company received gross proceeds of $15,000 (the “Financing”). After deducting transaction costs, the Company received
$13,906 without considering $173 of related expenses paid in 2016. Each Preferred Share was initially convertible into 0.141 shares
of common stock (after giving effect to the reverse stock split) at any time at the election of the investor. At the date of the
Financing, because the effective conversion rate of the Preferred Shares was less than the market value of the Company’s
common stock a beneficial conversion feature of $3,300 was recorded as a discount to the preferred stock and an increase to additional
paid in capital. Because the Preferred Shares were perpetual, at December 23, 2015, the Company fully amortized the discount related
to the beneficial conversion feature on the Preferred Shares to additional paid in capital to record a deemed dividend, and reflected
this amount as a preferred deemed dividend in the consolidated statement of operations and comprehensive loss.



Conversion of the Preferred Shares triggers
the amortization of the discount related to a beneficial conversion feature and to the 2015 Warrants. The terms of the Preferred
Shares and 2015 Warrants included price-based anti-dilution provisions providing for the adjustment of the conversion price and
the exercise price, as applicable, in the event the Company sold common stock or common stock equivalents (subject to exceptions
for certain exempt issuances) at a price lower than the then-conversion price of the Preferred Shares or the then-exercise price
of the 2015 Warrants. Because the sale price to the underwriters of the common stock in the August 2016 common stock offering was
less than the conversion price of the Preferred Shares at the time, the conversion price of the Preferred Shares was adjusted downwards
from $7.07 to $3.74 per share, which resulted in each outstanding Preferred Share becoming convertible into 0.267 shares of common
stock at any time at the election of the investor. As a result, the 3 Preferred Shares then outstanding became convertible, for
no additional consideration, into a total of 921 shares of the Company’s common stock.



49







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



At December 31, 2015, 13 Preferred Shares were
outstanding. As of December 31, 2016, no Preferred Shares remain outstanding and the warrant discount was fully amortized. During
the year ended December 31, 2016, 10 Preferred Shares were converted into 1,389 shares of common stock at a conversion price of
$7.07 per share, and 3 Preferred Shares were converted into 921 shares of common stock at a conversion price of $3.74 per share.
The conversions triggered the amortization of the warrant discount of $10,345 for the year ended December 31, 2016, which were
recorded in the consolidated statements of operations and comprehensive loss as non-cash preferred deemed dividends. During the
year ended December 31, 2015, 2 Preferred Shares were converted into common stock at a conversion price of $7.07 per share. The
conversion triggered the amortization of the warrant discount of $1,355, which was also accounted for as a preferred deemed dividend.



Warrants



Warrant share activity for the year ended December
31, 2016 was as follows:



|Source                   |  | Exercise Price |       |  | Term (Years) |  |         | December 31, 2015 |  |  | Exercised |  |  | December 31, 2016 |    
|------------------------ |  | -------------- | ----- |  | ------------ |  | ------- | ----------------- |  |  | --------- |  |  | ----------------- | ---
|2015 Warrants            |  | $              | 3.74  |  |              |  | 5       |                   |  |  | 2,122     |  |  |                   | 488
|2014 PPO and Merger      |  |                |       |  |              |  |         |                   |  |  |           |  |  |                   |    
|Placement agent warrants |  | $              | 7.00  |  |              |  | 5       |                   |  |  | 426       |  |  |                   | -  
|Bridge warrants          |  | $              | 7.00  |  |              |  | 3       |                   |  |  | 371       |  |  |                   | -  
|PPO warrants             |  | $              | 14.00 |  |              |  | 5       |                   |  |  | 1,078     |  |  |                   | -  
|Pre 2014 warrants        |  | $              | 9.66  |  |              |  | various |                   |  |  | 88        |  |  |                   | -  
|                         |  |                |       |  |              |  |         |                   |  |  | 4,085     |  |  |                   | 488



2015 Warrants



In connection with the December 2015 issuance
of Preferred Shares discussed above, the Company issued 2015 Warrants to purchase up to an aggregate of 2,122 shares of common
stock. The 2015 Warrants have a 5 year term. Because the sale price to the underwriters of the common stock in the August 2016
offering was less than the exercise price of the 2015 Warrants at the time, the exercise price of the 2015 Warrants was adjusted
downwards from $8.75 to $3.74 per share.



The terms of the 2015 Warrants are as follows:



| | · | Anti-Dilution Provision: The Warrants contain a “down round” anti-dilution adjustment provision, which provides that, solely during the period commencing on the date of the securities purchase agreement was executed in connection with the Financing and ending upon the closing of a financing resulting in aggregate proceeds to the Company of at least $10 million (a “Qualified Financing Event”), if the Company issues or sells common stock or common stock equivalents at a price per share less than the then applicable exercise price of the Warrants, the exercise price of the Warrants would be reduced to an amount equal to the issuance price of such additional shares of common stock or common stock equivalents. The August 2016 offering constituted a Qualified Financing Event and as a result, this provision is no longer effective.
| | - | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Put Option: While the Warrants are outstanding, if the Company enters into a Fundamental Transaction, defined as a merger, consolidation or similar transaction, the Company or any successor entity will, at the option of each Holder, exercisable at any time within 30 days after the consummation of the Fundamental Transaction, purchase the Warrant from the Holder exercising such option by paying to the Holder an amount of cash equal to the Black-Scholes Value of the remaining unexercised portion of such Holder’s Warrant on the date of the consummation of the Fundamental Transaction.
| | - | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



| | · | Call Option: Subject to certain conditions, the Company may call for cancellation of all or any portion of the unexercised Warrants. The consideration paid by the Company will be equal to the Black-Scholes Value of that portion of the Warrant called on the date the Company provides notice of its call. If the Company consummates a Fundamental Transaction (as described above) within six months after exercising its call option, and the consideration received by a holder of one share of common stock in such Fundamental Transaction is greater than the price per Warrant received by the Holder pursuant to the call, then the Company shall pay the Holder an amount equal to the difference between (x) the consideration received by a holder of common stock upon the Fundamental Transaction and (y) the price per Warrant paid in connection with the call, less the exercise price of the Warrant, payable in the same form as received by a holder of the common stock. If the Fundamental Transaction is a stock for stock merger, the Holder would receive shares of the successor entity valued at $1.75 per share on the same basis as a holder of common stock.
| | - | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



50







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



| | · | Cashless Exercise: If at the time of exercise there is no effective registration statement registering the shares underlying the Warrants, then the Warrants may be exercised on a cashless basis.
| | - | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------



The Warrants were
valued at $11,700 on the date of the transaction. Due to the Anti-Dilution and Put-Option provisions discussed above, the Warrants
were classified as a liability and are marked to market at each reporting date. Because the Warrants were recorded as a warrant
liability, the portion of proceeds from the sale of the Preferred Shares that was recorded as equity was reduced accordingly. Equity
issuance costs allocated to the Warrants were $487 and were expensed as financing costs at the date of issuance.



The warrant liability is measured at fair value
using certain estimated inputs, which are classified within Level 3 of the valuation hierarchy. These values are subject to a significant
degree of judgment on our part. The Company’s common stock price represents a significant input that affects the valuation
of the warrants.



The Company estimated the fair value of the
warrant liability on December 31, 2016 by using a Black-Scholes Option Pricing Model, as the anti-dilution provision was no longer
in effect. The following assumptions were used in the Black-Scholes Option Pricing Model to measure the fair value of the 2015
Warrants as of December 31, 2016:



|                        |  | December 31, 2016 |     
|----------------------- |  | ----------------- | ----
|Current share price     |  | $                 | 3.98
|Conversion price        |  | $                 | 3.74
|Risk-free interest rate |  |                   | 1.70
|Expected term (years)   |  |                   | 3.98
|Volatility of stock     |  |                   | 70  



The Company estimated the fair value of the
warrant liability on December 31, 2015 by using a Binomial Lattice Model. The following assumptions were used in the Binomial Lattice
Model to measure the fair value of the 2015 Warrants, including the embedded anti-dilution feature, as of December 31, 2015:



|                         |  | December 31, 2015 |     
|------------------------ |  | ----------------- | ----
|Current share price      |  | $                 | 7.14
|Conversion price         |  | $                 | 8.25
|Risk-free interest rate  |  |                   | 1.76
|Periodic rate            |  |                   | 0.88
|Time to Maturity (years) |  |                   | 4.98
|Volatility of stock      |  |                   | 75  



2014 PPO and Merger Warrants



As discussed in Note 3, 2014 Merger, Offering
and Other Related Transactions, the Company issued in connection with the Merger and PPO, warrants to purchase a total of 5,151
shares of common stock of which 4,329 were at an exercise price of $14.00 per share (the “Warrant Shares”), and the
balance of which were at an exercise price of $7.00 per share. These warrants contained “weighted average” anti-dilution
protection in the event that the Company issued common stock or securities convertible into or exercisable for shares of common
stock at a price lower than the subject warrant’s exercise price, subject to certain customary exceptions, as well as customary
provisions for adjustment in the event of stock splits, subdivision or combination, mergers, etc. The anti-dilution protection
feature required the Company to record the underlying securities as a liability and to adjust their respective values to market
at each reporting period. The factors utilized were as follows:



51







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



|Dividend yield                 |  |   | –            |  
|------------------------------ |  | - | ------------ | -
|Risk-free interest rate        |  |   | 0.60%
- 1.73 | %
|Share price at final valuation |  | $ | 1.51         |  
|Expected term (in years)       |  |   | 2.15-
4.80   |  
|Volatility                     |  |   | 65%
- 79     | %



As a result of the anti-dilution feature, the
Company recorded a non-cash charge of $16,485 during the year ended December 31, 2014 due to the market price of the Company’s
common stock price exceeding the exercise price of the then outstanding warrants. In October 2014, the Company offered the holders
of the 4,329 Warrant Shares an opportunity exercise their warrants at a temporarily reduced cash exercise price of $7.00 per share
of common stock from $14.00 per share and to amend the anti-dilution provision of the warrant. The offering was: (1) intended to
help the Company reduce its outstanding warrant liability, an impediment to the Company’s long term goal of pursuing listing
of its common stock on a national securities exchange, by removing the price-based anti-dilution provisions contained in the warrants,
and (2) provide funds to support the Company’s operations. At the conclusion of the offer, a majority of the holders of the
Warrant Shares consented to removal of the price-based anti-dilution provisions contained in the original warrants, and the Company
received $22,756 in cash, while incurring $1,467 of warrant solicitation costs. In November 2014 the remaining warrant liability
of $27,099 was re-classified as a component of additional paid-in capital in the Company’s consolidated balance sheet, and
no longer carried as a warrant liability as no anti-dilution feature remains with these outstanding warrants.



As discussed in Note 3, 2014 Merger, Offering
and Other Related Transactions, warrants to purchase preferred stock of Ekso Bionics outstanding prior to the Merger were converted
into warrants to purchase 89 shares of common stock of the Company in connection with the Merger. As of December 31, 2015, there
remained outstanding warrants to purchase 88 shares of the Company’s common stock outstanding, with the following terms:
(1) expire on various dates from June 1, 2022 to August 30, 2023; (2) have an exercise price of $9.66 per share; and (3) at the
option of the holder, may be exercised on a “cashless exercise” basis in which shares are retained to cover the exercise
price based on the market value of the Company’s common stock on the date of exercise.



14. Employee Stock Options



In the first quarter of 2014, prior to the
Merger, the Board of Directors and a majority of the stockholders adopted the 2014 Plan allowing for the issuance of 2,058 shares
of common stock. On June 10, 2015, the 2014 Plan was amended and restated with approval by the stockholders to increase the maximum
number of shares by 1,656 shares to an aggregate of 3,714 shares of common stock. Options previously issued under the Ekso Bionics
2007 Equity Incentive Plan that existed prior to the Merger were converted in connection with the Merger into options to purchase
an aggregate of 1,086 shares of the Company’s common stock under the 2014 Plan. As of December 31, 2016, there were 948 shares
available for future awards.



Under the terms of the 2014 Plan, the Board
of Directors may award stock, options, or similar rights having either a fixed or variable price related to the fair market value
of the shares and with an exercise or conversion privilege related to the passage of time, the occurrence of one or more events,
or the satisfaction of performance criteria or other conditions or any other security with the value derived from the value of
the shares. Such awards include stock options, restricted stock, restricted stock units, stock appreciation rights and dividend
equivalent rights.



The Board of Directors may grant stock options
under the 2014 Plan at a price of not less than 100% of the fair market value of the Company’s common stock on the date the
option is granted. Incentive stock options granted to employees who, on the date of grant, own stock representing more than 10%
of the voting power of all of the Company’s classes of stock, are granted at an exercise price of not less than 110% of the
fair market value of the Company’s common stock. The maximum term of incentive stock options granted to employees who, on
the date of grant, own stock possessing more than 10% of the voting power of all the Company’s classes of stock, may not
exceed five years. The maximum term of an incentive stock option granted to any other participant may not exceed ten years. Subject
to the limitations discussed above, the Board of Directors determines the term and exercise or purchase price of other awards granted
under the 2014 Plan. To date, no incentive stock options have been granted. The Board of Directors also determines the terms and
conditions of awards, including the vesting schedule and any forfeiture provisions. Options granted under the 2014 Plan may vest
upon the passage of time, generally four years, or upon the attainment of certain performance criteria established by the Board
of Directors. We may from time to time grant options to purchase common stock to non-employees for advisory and consulting services.
At each measurement period we re-measure the fair value of these stock options using the Black-Scholes option pricing model and
recognize expense ratably over the vesting period of each stock option award. Upon exercise of an option, it is the Company’s
policy to issue new shares of common stock.



52







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



A summary of the option activity as of December
31, 2016 and changes during the fiscal year then ended is presented below:



|                                                 |  | Options Outstanding |       |   | Weighted Average Exercise
    Price |   |      | Weighted Average Remaining
    Contractual Life (Years) |  |  | Aggregate Intrinsic Value | 
|------------------------------------------------ |  | ------------------- | ----- | - | ----------------------------------- | - | ---- | ------------------------------------------------------- |  |  | ------------------------- | 
|Outstanding as of December 31, 2015              |  |                     | 1,963 |   |                                     | $ | 7.09 |                                                         |  |  |                           | 
|Granted                                          |  |                     | 813   |   |                                     | $ | 5.40 |                                                         |  |  |                           | 
|Exercised                                        |  |                     | (44   | ) |                                     | $ | 2.51 |                                                         |  |  |                           | 
|Forfeited                                        |  |                     | (224  | ) |                                     | $ | 8.06 |                                                         |  |  |                           | 
|Expired                                          |  |                     | (31   | ) |                                     | $ | 9.39 |                                                         |  |  |                           | 
|Outstanding as of December 31, 2016              |  |                     | 2,477 |   |                                     | $ | 6.50 |                                                         |  |  | 7.46                      | 
|Vested and expected to vest at December 31, 2016 |  |                     | 2,321 |   |                                     | $ | 6.49 |                                                         |  |  | 7.34                      | 
|Exercisable as of December 31, 2016              |  |                     | 1,262 |   |                                     | $ | 5.97 |                                                         |  |  | 6.01                      | 



In 2016, we received $110 in cash from exercised
stock options. The intrinsic value of options exercised in 2016 was $103. The weighted-average grant-date fair value of options
granted in 2016 was $3.52 and the total fair value of shares vested during the year was $2,456.



As of December 31, 2016, total unrecognized
compensation cost related to unvested stock options was $4,822. This amount is expected to be recognized as stock-based compensation
expense in the Company’s consolidated statements of operations and comprehensive loss over the remaining weighted average
vesting period of 2.6 years.



Shares available for future grant under the
2014 Plan is as follows for the year ended December 31, 2016:



|                                  |  | Shares Available For Grant |      
|--------------------------------- |  | -------------------------- | -----
|Available as of December 31, 2015 |  |                            | 1,506
|Granted                           |  |                            | (813 
|Forfeited                         |  |                            | 224  
|Expired                           |  |                            | 31   
|Available as of December 31, 2016 |  |                            | 948  



53







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



The following table summarizes information about stock options outstanding
as of December 31, 2016:



|               |  | Options Outstanding |       |  | Options Exercisable | 
|-------------- |  | ------------------- | ----- |  | ------------------- | 
|               |  |                     |       |  | Weighted-
Average   | 
|Range of       |  |                     |       |  | Remaining           | 
|Exercise       |  | Number of           |       |  | Contractual Life    | 
|Prices         |  | Shares              |       |  | (Years)             | 
|$0.28 - $0.49  |  |                     | 106   |  |                     | 
|$2.73 - $4.00  |  |                     | 762   |  |                     | 
|$4.67 - $7.42  |  |                     | 876   |  |                     | 
|$8.96 - $15.33 |  |                     | 733   |  |                     | 
|               |  |                     | 2,477 |  |                     | 



Stock-based compensation is included in the
consolidated statements of operations and comprehensive loss in general and administrative, research and development or sales and
marketing expenses, depending upon the nature of services provided. Stock-based compensation expense recorded to operations for
stock options for both employees and non-employees was as follows:



|                           |  | Years Ended December 31, |      
|-------------------------- |  | ------------------------ | -----
|                           |  | 2016                     |      
|Sales and marketing        |  | $                        | 677  
|Research and development   |  |                          | 632  
|General and administrative |  |                          | 1,812
|                           |  | $                        | 3,121



In connection with the resignation of the Company’s
then Chief Executive Officer in February 2016, the Company accelerated the vesting of options that would have vested in the subsequent
twelve months and extended the exercise period of the resulting options from three months to six years. In addition, the Company
extended the exercise period for an employee that was terminated in March 2016 from three months to one year. These modifications
resulted in incremental stock-based compensation expense of $59 and $774 included in research and development and general and administrative,
respectively, for the year ended December 31, 2016 in the consolidated statements of operations and comprehensive loss.



During the year ended December 31, 2014, due
to a decline in the Company’s stock price following the Merger, options representing 122 shares of common stock that were
granted to 14 employees with original per share exercise prices ranging from $24.99 to $45.50 were modified to a per share exercise
price of $15.33.  The modification resulted in an incremental compensation cost of $411 that is being recognized over the
respective service periods of the original grant.



The Company recognizes compensation expense
using the straight-line method over the requisite service period. The fair value of each stock option grant was estimated on the
date of grant using the Black-Scholes option pricing model under the following assumptions:



|                         |  | Years Ended December 31, |             
|------------------------ |  | ------------------------ | ------------
|                         |  | 2016                     |             
|Dividend yield           |  |                          | —           
|Risk-free interest rate  |  |                          | 1.24% - 2.37
|Expected term (in years) |  |                          | 5.27-10     
|Volatility               |  |                          | 77%-83      



54







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



15. Income Taxes



The domestic and foreign components of pre-tax
loss for the years ended December 31, 2016, 2015, and 2014 were as follows:



|                         |  | Years Ended December 31, |        
|------------------------ |  | ------------------------ | -------
|                         |  | 2016                     |        
|Domestic                 |  | $                        | (21,458
|Foreign                  |  |                          | (2,012 
|Loss before income taxes |  | $                        | (23,470



The Company had no current or deferred federal
and state income tax expense or benefit for the years ended December 31, 2016, 2015, and 2014 because the Company generated net
operating losses, and currently management does not believe it is more likely than not that the net operating losses will be realized.
The Company’s non-U.S. tax obligation is primarily for business activities conducted through the United Kingdom for which
taxes included in other expense, net for the years ended December 31, 2016, 2015, and 2014 were immaterial and accordingly, such
amounts were excluded from the following tables.



Income tax expense (benefit) for the years
ended December 31, 2016, 2015, and 2014 differed from the amounts computed by applying the statutory federal income tax rate of
34% to pretax income (loss) as a result of the following:



|                                     |  | Years Ended December 31, |      
|------------------------------------ |  | ------------------------ | -----
|                                     |  | 2016                     |      
|Federal tax at statutory rate        |  |                          | 34.0 
|State tax, net of federal tax effect |  |                          | -    
|R&D credit                           |  |                          | 0.9  
|Change in valuation allowance        |  |                          | (40.8
|Non- deductible expenses             |  |                          | (0.2 
|Unrealized (gain) loss on warrant    |  |                          | 6.2  
|Foreign                              |  |                          | (0.4 
|Other                                |  |                          | 0.3  
|Total tax expense                    |  |                          | -    



The tax effects of temporary differences and
related deferred tax assets and liabilities as of December 31, 2016 and 2015 were as follows:



|                                   |  | December 31, |        
|---------------------------------- |  | ------------ | -------
|                                   |  | 2016         |        
|Deferred tax assets:               |  |              |        
|Depreciation and other             |  | $            | 61     
|Net operating loss carryforwards   |  |              | 35,647 
|Unused R& D tax credits            |  |              | 872    
|Accruals & reserves                |  |              | 951    
|Deferred Revenue                   |  |              | 246    
|Stock Compensation                 |  |              | 2,430  
|Other                              |  |              | 86     
|Deferred tax liabilities:          |  |              |        
|Depreciation and other             |  |              | -      
|Prepaid expenses                   |  |              | (168   
|Less: Valuation allowance          |  |              | (40,125
|Net deferred tax asset (liability) |  | $            | -      



55







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



The Company’s accounting for deferred
taxes involves the evaluation of a number of factors concerning the realizability of the Company’s net deferred tax assets.
The Company primarily considered such factors as the Company’s history of operating losses; the nature of the Company’s
deferred tax assets and the timing, likelihood and amount, if any, of future taxable income during the periods in which those temporary
differences and carryforwards become deductible. At present, the Company does not believe that it is more likely than not that
the deferred tax assets will be realized; accordingly, a full valuation allowance was established and no deferred tax assets were
shown in the accompanying balance sheets. The valuation allowance increased by $10,827 and $7,983 during the years ended December 31,
2016 and 2015, respectively.



As of December 31, 2016 the Company had
federal net operating loss carryforwards of $93,749. The Company also had federal research and development tax credit carryforwards
of $818. The net operating loss and tax credit carryforwards will expire at various dates beginning in 2027, if not utilized.



As of December 31, 2016, the Company had
state net operating loss carryforwards of $76,263, which will begin to expire in 2017. The Company also had state research and
development tax credit carryforwards of $524, which have no expiration.



As of December 31, 2016, the Company had
foreign net operating loss carryforwards of $2,012. The foreign net operating loss carryforwards do not expire.



As of December 31, 2016, $1,684 of federal
and $657 of state net operating loss is attributable to stock-based compensation deductions in excess of book expense. Upon adoption
of ASU 2016-09-Compensation-Stock Compensation, the benefit of the tax deduction related to these options will not affect retained
earnings if the Company is applying a full valuation allowance against the deferred tax assets, as is the Company’s current
policy.



Utilization of the Company’s net operating
losses and credit carryforwards may be subject to annual limitations in the event of a Section 382 ownership change. Such future
limitations could result in the expiration of net operating losses and credit carryforwards before utilization as a result of such
an ownership change.



A reconciliation of the beginning and ending
amount of unrecognized tax benefits were as follows:



|Balance at December 31, 2013                                  |  | $ | 93  |  
|------------------------------------------------------------- |  | - | --- | -
|Increase of unrecognized tax benefits taken in prior years    |  |   | 4   |  
|Increase of unrecognized tax benefits related to current year |  |   | 46  |  
|Balance at December 31, 2014                                  |  |   | 143 |  
|Decrease of unrecognized tax benefits taken in prior years    |  |   | (19 | )
|Increase of unrecognized tax benefits related to current year |  |   | 75  |  
|Balance at December 31, 2015                                  |  |   | 199 |  
|Increase of unrecognized tax benefits taken in prior years    |  |   | 4   |  
|Increase of unrecognized tax benefits related to current year |  |   | 132 |  
|Balance at December 31, 2016                                  |  | $ | 335 |  



If the Company eventually is able to recognize
these uncertain tax positions, the unrecognized tax benefits would not reduce the effective tax rate if the Company is applying
a full valuation allowance against the deferred tax assets, as is the Company’s current policy.



The Company had not incurred any material tax
interest or penalties as of December 31, 2016. The Company does not anticipate any significant change within 12 months
of this reporting date of its uncertain tax positions. The Company is subject to taxation in the United States, the United Kingdom,
Germany, and various states jurisdictions. There are no other ongoing examinations by taxing authorities at this time. The Company’s
tax years 2007 through 2016 will remain open for examination by the federal and state authorities for three and four years, respectively,
from the date of utilization of any net operating loss credits.



56







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



16. Commitments and Contingencies



Contingencies



In the normal course of business, the Company
is subject to various legal matters. In the opinion of management, the resolution of such matters will not have a material adverse
effect on the Company’s consolidated financial statements.



Material Contracts



The Company enters into various license, research
collaboration and development agreements which provide for payments to the Company for government grants, fees, cost reimbursements
typically with a markup, technology transfer and license fees, and royalty payments on sales.



The Company has two license agreements to maintain
exclusive rights to patents. The Company is also required to pay 1% of net sales of products sold to entities other than the U.S.
government. In the event of a sublicense, the Company will owe 21% of license fees and must pass through 1% of the sub-licensee’s
net sales of products sold to entities other than the U.S. government. The agreements also stipulate minimum annual royalties of
$50.



In connection with acquisition of Equipois,
the Company assumed the rights and obligations of Equipois under a license agreement with Garrett Brown, the developer of certain
intellectual property related to mechanical balance and support arm technologies, which grants us an exclusive license with respect
to the technology and patent rights for certain fields of use. Pursuant to the terms of the license agreement, the Company will
be required to pay Mr. Brown a single-digit royalty on net receipts, subject to a $50 annual minimum royalty requirement.



The following table summarizes our outstanding
contractual obligations, including interest payments, as of December 31, 2016 and the effect those obligations are expected to
have on our liquidity and cash flows in future periods:



|                           |  | Payments Due By Period |       
|-------------------------- |  | ---------------------- | ------
|                           |  | Total                  |       
|Term loan                  |  | $                      | 8,345 
|Facility operating lease   |  |                        | 2,552 
|Capital lease              |  |                        | 136   
|Leasehold improvement loan |  |                        | 20    
|Total                      |  | $                      | 11,053



U.S. Food and Drug Administration Clearance



On April 4, 2016, the Company received clearance
from the U.S. Food and Drug Administration (“FDA”) to market its Ekso GT robotic exoskeleton for use in the treatment
of individuals with hemiplegia due to stroke, individuals with spinal cord injuries at levels T4 to L5, and individuals with spinal
cord injuries at levels of T3 to C7 (ASIA D), in accordance with the device’s labeling. On July 19, 2016, the Company received
clearance from the FDA to expand/clarify the indications and labeling to expressly include individuals with hemiplegia due to stroke
who have upper extremity function of at least 4/5 in only one arm. The Company’s prior cleared indications for use statement
required that individuals with hemiplegia due to stroke have upper extremity function of at least 4/5 in both arms.



57







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



The Company believes that prior to April 4,
2016, the Company’s Ekso GT robotic exoskeleton had been appropriately marketed in the United States as a Class I 510(k)
exempt Powered Exercise Equipment device since February 2012. On June 26, 2014, the FDA announced the creation of a new product
classification for Powered Exoskeleton devices. On October 21, 2014, the FDA published the summary for the new Powered Exoskeleton
classification and designated it as being Class II, which requires the clearance of a 510(k) notice. On October 21, 2014, concurrent
with the FDA’s publication of the reclassification of Powered Exoskeleton devices, the FDA issued the Company an “Untitled
Letter” which informed the Company in writing of the agency’s belief that this new product classification applied to
the Ekso GT device. On December 24, 2014, the Company filed a 510(k) notice for the Ekso robotic exoskeleton which was accepted
by the FDA for substantive review on July 29, 2015. As discussed above, the Company received FDA clearance to market the Ekso GT
in accordance with the device’s labeling on April 4, 2016.



From
September 2, 2015 to September 11, 2015, the Division of Bioresearch Monitoring Center for Devices and Radiological Health of the
FDA conducted an inspection of the Company’s facility in Richmond, California. At the conclusion of the inspection, the FDA
issued a Form FDA 483 with four observations. These observations were inspectional and did not represent a final FDA determination
of non-compliance. The observations pertained to informed consent requirements, reporting of adverse results and records maintenance.
On October 2, 2015, the Company responded to the FDA describing the corrective and preventive actions that the Company had implemented
and continued to implement to address the FDA’s concerns. On March 30, 2016, the FDA accepted the Company’s
corrective actions for the Form 483 observations that were generated during the FDA’s inspection.



17. Segment Disclosures



During the third quarter of 2016, the Company
determined industrial sales to be a reportable segment as a result of progress in commercialization and sales of its industrial
devices. We have recast certain prior period amounts to conform to the way we internally manage and monitor segment performance.



The Company has three reportable segments,
Medical Devices, Industrial Sales, and Engineering Services. The Medical Devices segment designs and engineers technology, and
commercializes, manufactures, and sells exoskeletons for applications in the medical markets. The Industrial Sales segment designs,
engineers, commercializes, and sells exoskeleton devices to allow able-bodied users to perform heavy duty work for extended periods.
Engineering Services generates revenue principally from collaborative research and development service arrangements, technology
license agreements, and government grants where the Company uses its robotics domain knowledge in bionic exoskeletons to bid on
and procure contracts and grants from entities such as the National Science Foundation and the Defense Advanced Research Projects
Agency.



The Company evaluates performance and allocates
resources based on segment gross profit margin. The reportable segments are each managed separately because they serve distinct
markets, and one segment provides a service and the others manufacture and distribute unique products. The Company does not consider
net assets as a segment measure and, accordingly, assets are not allocated.



Segment reporting information is as follows:



|                             |  | Medical |        |  | Industrial |   |       | Engineering |  |   |       | 
|---------------------------- |  | ------- | ------ |  | ---------- | - | ----- | ----------- |  | - | ----- | 
|                             |  | Devices |        |  | Sales      |   |       | Services    |  |   | Total | 
|Year ended December 31, 2016 |  |         |        |  |            |   |       |             |  |   |       | 
|Revenue                      |  | $       | 12,081 |  |            | $ | 1,253 |             |  | $ | 887   | 
|Cost of revenue              |  |         | 9,767  |  |            |   | 948   |             |  |   | 559   | 
|Gross profit                 |  | $       | 2,314  |  |            | $ | 305   |             |  | $ | 328   | 
|                             |  |         |        |  |            |   |       |             |  |   |       | 
|Year ended December 31, 2015 |  |         |        |  |            |   |       |             |  |   |       | 
|Revenue                      |  | $       | 4,252  |  |            | $ | -     |             |  | $ | 4,409 | 
|Cost of revenue              |  |         | 3,926  |  |            |   | -     |             |  |   | 3,556 | 
|Gross profit                 |  | $       | 326    |  |            | $ | -     |             |  | $ | 853   | 



58







Ekso Bionics Holdings, Inc.

Notes to Consolidated Financial Statements

(In thousands, except per share amounts)



|                             |  | Medical |       |  | Industrial |   |   | Engineering |  |   |       | 
|---------------------------- |  | ------- | ----- |  | ---------- | - | - | ----------- |  | - | ----- | 
|                             |  | Devices |       |  | Sales      |   |   | Services    |  |   | Total | 
|Year ended December 31, 2014 |  |         |       |  |            |   |   |             |  |   |       | 
|Revenue                      |  | $       | 2,924 |  |            | $ | - |             |  | $ | 2,403 | 
|Cost of revenue              |  |         | 2,048 |  |            |   | - |             |  |   | 1,720 | 
|Gross profit                 |  | $       | 876   |  |            | $ | - |             |  | $ | 683   | 



Geographic revenue information based on location of customer is
as follows:



|              |  | Years Ended December 31 |       
|------------- |  | ----------------------- | ------
|              |  | 2016                    |       
|United States |  | $                       | 9,042 
|All Other     |  |                         | 5,179 
|              |  | $                       | 14,221



18. Quarterly Data (Unaudited)



The following is a summary of quarterly results of operation for
the years ended December 31, 2016 and 2015:



|                                           |  | Quarter Ended |       
|------------------------------------------ |  | ------------- | ------
|                                           |  | March 31      |       
|2016                                       |  |               |       
|Revenue                                    |  | $             | 8,486 
|Gross profit                               |  |               | 1,498 
|Net loss                                   |  |               | (3,651
|Net loss applicable to common shareholders |  |               | (6,775
|                                           |  |               |       
|Basic net loss per share(1)                |  |               | (0.44 
|Diluted net loss per share(1)              |  | $             | (0.44 
|                                           |  |               |       
|2015                                       |  |               |       
|Revenue                                    |  | $             | 1,689 
|Gross profit                               |  |               | 403   
|Net income (loss)                          |  |               | (4,115
|Net loss applicable to common shareholders |  |               | (4,115
|                                           |  |               |       
|Basic and diluted net loss per share(1)    |  | $             | (0.28 



(1) Quarterly net loss per common share amounts may not
total to the annual amounts due to rounding and the changes in the number of weighted common shares outstanding and included in
the calculation of basic and diluted common shares.



59







Item 9A.     CONTROLS AND PROCEDURES



Disclosure Controls and Procedures.



Our management, with the participation of our
principal executive officer and principal financial officer, evaluated the effectiveness of our disclosure controls and procedures
(as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of December 31, 2016. Based upon that evaluation, at the time that
our Annual Report on Form 10-K for the year ended December 31, 2016 was filed on March 15, 2017, our principal executive officer
and principal financial officer concluded that, as of such date, our disclosure controls and procedures were effective to
ensure that information required to be disclosed in reports filed by us under the Securities Exchange Act of 1934 is recorded,
processed, summarized and reported within the required time periods and is accumulated and communicated to our management, including
our principal executive officer and principal financial officer, as appropriate to allow timely decisions regarding required disclosure.
Subsequent to that evaluation, as a result of the material weakness in our internal control over financial reporting described
below, our principal executive officer and principal financial officer concluded that our disclosure controls and procedures were
not effective as of December 31, 2016. The Company is amending this Item 9A to reflect this conclusion.



It should be noted that any controls and procedures,
no matter how well designed and operated, can provide only reasonable assurance of achieving their objectives and management necessarily
applies its judgment and makes assumptions about the likelihood of future events. There can be no assurance that any design will
succeed in achieving its stated goals under all potential future conditions, regardless of how remote. Management believes that
the financial statements included in this report fairly present in all material respects our financial condition, results of operations
and cash flows for the periods presented.



Management’s Report on Internal Control
Over Financial Reporting (restated)



The management of the Company is responsible
for establishing and maintaining adequate internal control over financial reporting, as such term is defined in the U.S. Securities
Exchange Act of 1934, Rules 13a-15(f) and 15d-15(f). The Company’s internal control system was designed to provide reasonable assurance
to the Company’s management and board of directors regarding the preparation and fair presentation of published financial statements.
Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.



The Company’s management assessed the effectiveness
of the Company’s internal control over financial reporting as of December 31, 2016 based on the criteria set forth by the Committee
of Sponsoring Organizations of the Treadway Commission in Internal Control—Integrated Framework (2013). The Company’s
management believes that based on this criteria, as of December 31, 2016, there was a material weakness in the Company’s
information technology general controls. Specifically, our design and maintenance of processes and procedures that restrict access
to key financial systems and records to appropriate users did not ensure there was adequate segregation of duties, and our compensating
controls, including management oversight, could not be sufficiently demonstrated by evidence to overcome this weakness. The existence
of this material weakness did not result in any adjustments to the Company’s financial statements for the year ended December
31, 2016.



In Management’s Report on Internal Control
over Financial Reporting included in our original Annual Report on Form 10-K for the year-ended December 31, 2016, our management,
under the supervision of our Chief Executive Officer and Chief Financial Officer, concluded that we maintained effective internal
control over financial reporting as of December 31, 2016. We have subsequently concluded that the material weakness described above
existed as of December 31, 2016. As a result, management has concluded that we did not maintain effective internal control over
financial reporting as of December 31, 2016, based on the criteria described above. Management therefore has restated its report
on internal control over financial reporting.



OUM & Co. LLP, our independent registered
public accounting firm, has issued an attestation report expressing an adverse opinion on the effectiveness of our internal control
over financial reporting as of December 31, 2016, which appears under Item 8 of this Annual Report on Form 10-K.



Changes in Internal Control Over Financial
Reporting



Except with respect to the material weakness
noted above, there were no changes in our internal control over financial reporting identified in connection with the evaluation
required by (d) of Exchange Act Rules 13a-15 or 15d-15 that occurred during our fourth quarter of 2016 that have materially affected,
or are reasonably likely to materially affect, our internal control over financial reporting.



60







PART IV



Item 15.      EXHIBITS, FINANCIAL
STATEMENTS AND FINANCIAL STATEMENT SCHEDULES



| | (a) | Financial Statements and Schedules: The following financial statement documents are included as part of Item 8 to this Form 10-K:
| | --- | ---------------------------------------------------------------------------------------------------------------------------------



Reports
of Independent Registered Public Accounting Firm



Consolidated
Balance Sheets as of December 31, 2016 and 2015



Consolidated
Statements of Operations and Comprehensive loss for the years ended December 31, 2016, 2015 and 2014



Consolidated
Statements of Stockholders’ Equity (Deficit) for the years ended December 31, 2016, 2015 and 2014



Consolidated
Statements of Cash Flows for the years ended December 31, 2016, 2015 and 2014



Notes
to the Consolidated Financial Statements



All schedules are omitted because
they are not applicable or the required information is shown in the financial statements or notes thereto.



| | (b) | Exhibits. The exhibits filed with this Report are set forth in the Exhibit Index.
| | --- | ---------------------------------------------------------------------------------



61







SIGNATURES



Pursuant to the requirements of Section 13
or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.





|Dated: December 27, 2017 | By: | /s/ Thomas Looby                     
|------------------------ | --- | -------------------------------------
|                         |     | President and Chief Executive Officer
|                         |     | (Principal Executive Officer)        



62







Exhibit Index



|ExhibitNumber |  | Description                                                                                                                                                                                                                                                                              
|------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|              |  |                                                                                                                                                                                                                                                                                          
|2.1           |  | Agreement and Plan of Merger and Reorganization, dated as of January 15, 2014, by and among the Registrant, Acquisition Sub and Ekso Bionics, Inc. (incorporated by reference from Exhibit 2.1 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                 
|              |  |                                                                                                                                                                                                                                                                                          
|3.1           |  | Articles of Incorporation of the Registrant (incorporated by reference from Exhibit 3.1 to the Registrant’s Annual Report on Form 10-K filed on March 19, 2015)                                                                                                                          
|              |  |                                                                                                                                                                                                                                                                                          
|3.2           |  | Certificate of Merger of Ekso Bionics, Inc., with and into Acquisition Sub, filed January 15, 2014 (incorporated by reference from Exhibit 3.3 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                 
|              |  |                                                                                                                                                                                                                                                                                          
|3.3           |  | By-Laws of the Registrant (incorporated by reference from Exhibit 3.4 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                          
|              |  |                                                                                                                                                                                                                                                                                          
|3.4           |  | Certificate of Designation of Preferences, Rights and Limitations of Series A Convertible Preferred Stock, filed on December 23, 2015 (incorporated by reference from Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on December 24, 2015)                             
|              |  |                                                                                                                                                                                                                                                                                          
|3.5           |  | Certificate of Amendment to Certificate of Designation of Series A Convertible Preferred Stock, filed on April 4, 2016 (incorporated by reference from Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on April 7, 2016)                                                
|              |  |                                                                                                                                                                                                                                                                                          
|3.6           |  | Certificate of Change of Ekso Bionics Holdings, Inc. effective May 4, 2016 (incorporated by reference from Exhibit 3.1 to the Registrant’s Current Report on Form 8-K filed on May 5, 2016)                                                                                              
|              |  |                                                                                                                                                                                                                                                                                          
|4.1           |  | Form of specimen certificate (incorporated by reference from Exhibit 4.4 to the Registrant’s Registration Statement on Form S-3 filed on June 23, 2015)                                                                                                                                  
|              |  |                                                                                                                                                                                                                                                                                          
|10.1          |  | Indemnification Shares Escrow Agreement, dated as of January 15, 2014, by and among the Registrant, Nathan Harding and Gottbetter & Partners, LLP, as escrow agent (incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)
|              |  |                                                                                                                                                                                                                                                                                          
|10.2          |  | Split-Off Agreement, dated as of January 15, 2014, by and among the Registrant, PN Med Split Off Corp, Pedro Perez Niklitschek and Miguel Molina Urra (incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)             
|              |  |                                                                                                                                                                                                                                                                                          
|10.3          |  | General Release Agreement, dated as of January 15, 2014, by and among the Registrant, PN Med Split Off Corp, Pedro Perez Niklitschek and Miguel Molina Urra (incorporated by reference from Exhibit 10.3 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)       
|              |  |                                                                                                                                                                                                                                                                                          
|10.4†         |  | Form of Lock-Up and No Short Selling Agreement between the Registrant and the officers, directors and stockholders party thereto (incorporated by reference from Exhibit 10.4 the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                     
|              |  |                                                                                                                                                                                                                                                                                          
|10.5          |  | Form of Subscription Agreement between the Registrant and the investors party thereto (incorporated by reference from Exhibit 10.5 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                             



63







|10.6(a)  |  | Form of Bridge Warrant and Warrant issued to Ekso Bionics’ prior lender for Common Stock of the Registrant   (incorporated by reference from Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                      
|-------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|         |  |                                                                                                                                                                                                                                                                                          
|10.6(b)  |  | Form of Amendment to Bridge Warrant and Warrant issued to Ekso Bionics’ prior lender for Common Stock of the Registrant, effective November 20, 2014 (incorporated by reference from Exhibit 10.6(b) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014)
|         |  |                                                                                                                                                                                                                                                                                          
|10.7(a)  |  | Form of Bridge Agent Warrant for Common Stock of the Registrant (incorporated by reference from Exhibit 10.7 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                   
|         |  |                                                                                                                                                                                                                                                                                          
|10.7(b)  |  | Form of Amendment to Bridge Agent Warrant for Common Stock of the Registrant, effective November 20, 2014 (incorporated by reference from Exhibit 10.7(b) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014)                                           
|         |  |                                                                                                                                                                                                                                                                                          
|10.8(a)  |  | Form of PPO Warrant for Common Stock of the Registrant (incorporated by reference from Exhibit 10.8 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                            
|         |  |                                                                                                                                                                                                                                                                                          
|10.8(b)  |  | Form of Amendment to PPO Warrant for Common Stock of the
    Registrant, effective November 20, 2014, with respect to Offer to Amend and Exercise (incorporated by reference from
    Exhibit 99.(a)(1)(c) to the Registrant’s Schedule TO filed on October 23, 2014)                    
|         |  |                                                                                                                                                                                                                                                                                          
|10.8(c)  |  | Form of Amendment to PPO Warrant for Common Stock of the
    Registrant, effective November 20, 2014, with respect to Anti-Dilution Amendment (incorporated by reference from Exhibit
    99.(a)(1)(F) to the Registrant’s Schedule TO filed on October 23, 2014)                        
|         |  |                                                                                                                                                                                                                                                                                          
|10.9(a)  |  | Form of PPO Agent Warrant for Common Stock of the Registrant (incorporated by reference from Exhibit 10.9 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                      
|         |  |                                                                                                                                                                                                                                                                                          
|10.9(b)  |  | Form of Amendment to PPO Agent Warrant for Common Stock of the Registrant, effective November 20, 2014 (incorporated by reference from Exhibit 10.9(b) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014)                                              
|         |  |                                                                                                                                                                                                                                                                                          
|10.10    |  | Form of Registration Rights Agreement (incorporated by reference from Exhibit 10.10 of the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                            
|         |  |                                                                                                                                                                                                                                                                                          
|10.11(a) |  | Placement Agency Agreement, dated December 5, 2015, between the Registrant and Gottbetter Capital Markets, LLC (incorporated by reference from Exhibit 10.11 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                   
|         |  |                                                                                                                                                                                                                                                                                          
|10.11(b) |  | First Amendment to Placement Agency Agreement, dated January 28, 2014, between the Registrant and Gottbetter Capital Markets, LLC (incorporated by reference from Exhibit 10.6 to the Registrant’s Current Report on Form 8-K filed on January 31, 2014)                                 
|         |  |                                                                                                                                                                                                                                                                                          
|10.11(c) |  | Second Amendment to Placement Agency Agreement, dated October 21, 2014, between the Registrant and Gottbetter Capital Markets, LLC (incorporated by reference from Exhibit 10.11(c) to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2014)                 
|         |  |                                                                                                                                                                                                                                                                                          
|10.12†   |  | Amended and Restated 2014 Equity Incentive Plan (incorporated by reference from Appendix A to the Registrant’s Proxy Statement on Schedule 14A filed on May 11, 2015)                                                                                                                    
|         |  |                                                                                                                                                                                                                                                                                          
|10.13    |  | Form of Director Option Agreement under 2014 Equity Incentive Plan (incorporated by reference from Exhibit 10.13 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                               
|         |  |                                                                                                                                                                                                                                                                                          
|10.14†   |  | Form of Employee Option Agreement under 2014 Equity Incentive Plan (incorporated by reference from Exhibit 10.14 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                               



64







|10.15†  |  | Employment Agreement, dated as of January 15, 2014, between the Registrant and Nathan Harding (incorporated by reference from Exhibit 10.15 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                                                                                                     
|------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.16†  |  | Employment Agreement, dated as of January 15, 2014, between the Registrant and Max Scheder-Bieschin (incorporated by reference from Exhibit 10.16 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                                                                                               
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.17†  |  | Employment Agreement, dated as of January 15, 2014, between the Registrant and Russ Angold (incorporated by reference from Exhibit 10.17 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                                                                                                        
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.18†  |  | Employment Agreement, dated as of January 15, 2014, between the Registrant and Frank Moreman (incorporated by reference from Exhibit 10.18 the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                                                                                                         
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.19   |  | Exclusive License Agreement, dated as of November 15, 2005, by and between The Regents of the University of California and Berkeley ExoTech, Inc., d/b/a Berkeley ExoWorks (incorporated by reference from Exhibit 10.19 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                        
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.20   |  | Exclusive License Agreement, dated as of July 14, 2008, by and between The Regents of the University of California and Berkeley ExoTech, Inc., d/b/a/ Berkeley Bionics and formerly d/b/a Berkeley ExoWorks (as amended by Amendment #1 to Exclusive License Agreement, dated as of May 20, 2009, by and between The Regents of the University of California and Berkeley Bionics) (incorporated by reference from Exhibit 10.20 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.21   |  | Lease, dated as of November 29, 2011, by and between FPOC, LLC and Berkeley Bionics, Inc., d/b/a Ekso Bionics (incorporated by reference from Exhibit 10.21 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                                                                                     
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.22   |  | Letter Agreement, dated as of November 12, 2013, by and between Gravitas Partners Ltd., Premium Capital Partners Ltd., and Ekso Bionics, Inc. (incorporated by reference from Exhibit 10.22 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                                                     
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.23   |  | Director Nomination Agreement dated as of January 15, 2013, among the Registrant, Ekso Bionics and CNI Commercial LLC (incorporated by reference from Exhibit 10.23 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                                                                             
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.24   |  | Form of Ekso Bionics’ Warrant to purchase shares of its common stock (converted under the Merger Agreement into warrants to purchase shares of the Registrant’s Common Stock) (incorporated by reference from Exhibit 10.24 to the Registrant’s Current Report on Form 8-K filed on January 23, 2014)                                                                                                                                                                                                     
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.25** |  | Government Field Cross License Agreement dated as of July 1, 2013 between Ekso Bionics and Lockheed Martin Corporation (incorporated by reference from Exhibit 10.25 to the Amendment No. 2 to the Registrations’ Current Report on Form 8-K filed March 31, 2014)                                                                                                                                                                                                                                        
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.26** |  | Medical License Agreement dated as of July 1, 2013 between Ekso Bionics and Lockheed Martin Corporation (incorporated by reference from Exhibit 10.26 to the Amendment No. 2 to the Registrations’ Current Report on Form 8-K filed March 31, 2014)                                                                                                                                                                                                                                                       
|        |  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|10.27** |  | Cross License Agreement dated as of July 1, 2013 between Ekso Bionics and Lockheed Martin Corporation (incorporated by reference from Exhibit 10.27 to the Amendment No. 2 to the Registrations’ Current Report on Form 8-K filed March 31, 2014)                                                                                                                                                                                                                                                         



65







|10.28†  |  | Form of Non-Employee Director Indemnification Agreement (incorporated by reference from Exhibit 10.20 to the Registrant’s Quarterly Report on Form 10-Q filed on May 13, 2014)                                                                                                                    
|------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |  |                                                                                                                                                                                                                                                                                                   
|10.29†  |  | Form of Executive Officer Indemnification Agreement (incorporated by reference from Exhibit 10.21 to the Registrant’s Quarterly Report on Form 10-Q filed on May 13, 2014)                                                                                                                        
|        |  |                                                                                                                                                                                                                                                                                                   
|10.30   |  | Warrant Agent Agreement, dated October 21, 2014, by and between
    the Registrant and Katalyst Securities LLC (incorporated by reference from Exhibit 99.(d)(1) to the Registrant’s
    Schedule TO filed on October 23, 2014)                                                                   
|        |  |                                                                                                                                                                                                                                                                                                   
|10.31   |  | Warrant Agent Agreement, dated October 21, 2014, by and between
    the Registrant and EDI Financial, Inc. (incorporated by reference from Exhibit 99.(d)(2) to the Registrant’s
    Schedule TO filed on October 23, 2014)                                                                       
|        |  |                                                                                                                                                                                                                                                                                                   
|10.32†  |  | Employment Agreement, dated March 19, 2015, between the Registrant and Thomas Looby (incorporated by reference from Exhibit 10.32 to the Registrants Annual Report on Form 10-K for the year ended December 31, 2014)                                                                             
|        |  |                                                                                                                                                                                                                                                                                                   
|10.33   |  | Form of Warrant to purchase shares of the Registrant’s common stock (incorporated by reference from Exhibit 4.1 to the Registrant’s Current Report on Form 8-K filed December 24, 2015)                                                                                                           
|        |  |                                                                                                                                                                                                                                                                                                   
|10.34   |  | Securities Purchase Agreement dated December 23, 2015 (incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed December 24, 2015)                                                                                                                        
|        |  |                                                                                                                                                                                                                                                                                                   
|10.35   |  | Placement Agency Agreement, dated December 23, 2015, by and among the Registrant and Ladenburg Thalmann & Co., Inc., as representative of the placement agents named therein  (incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed December 24, 2015)
|        |  |                                                                                                                                                                                                                                                                                                   
|10.36†  |  | Nathaniel Harding Separation Agreement dated February 25, 2016 (incorporated by reference from Exhibit 10.36 to the Registrant’s Annual Report on Form 10-K for the year ended December 31, 2015)                                                                                                 
|        |  |                                                                                                                                                                                                                                                                                                   
|10.37   |  | Form of Amendment to Securities Purchase Agreement  (incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed April 7, 2016)                                                                                                                              
|        |  |                                                                                                                                                                                                                                                                                                   
|10.38   |  | Amendment to Lease Agreement dated November 5, 2016 (incorporated by reference from Exhibit 10.38 to the Registrant’s Quarterly Report on Form 10-Q for the quarter ended September 30, 2016)                                                                                                     
|        |  |                                                                                                                                                                                                                                                                                                   
|10.39   |  | Loan and Security Agreement dated as of December 30, 2016 by and among the Registrant, Ekso Bionics, Inc. and Western Alliance Bank (incorporated by reference from Exhibit 10.1 to the Registrant’s Current Report on Form 8-K filed January 6, 2017)                                            
|        |  |                                                                                                                                                                                                                                                                                                   
|10.40   |  | Success Fee Agreement dated as of December 30, 2016 by and among the Registrant, Ekso Bionics, Inc. and Western Alliance Bank (incorporated by reference from Exhibit 10.2 to the Registrant’s Current Report on Form 8-K filed January 6, 2017)                                                  
|        |  |                                                                                                                                                                                                                                                                                                   
|21.1*   |  | Subsidiaries of the Registrant                                                                                                                                                                                                                                                                    
|        |  |                                                                                                                                                                                                                                                                                                   
|23.1*** |  | Consent of Independent Registered Public Accounting Firm                                                                                                                                                                                                                                          
|        |  |                                                                                                                                                                                                                                                                                                   
|31.1*** |  | Certification of Chief Executive Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.                                                                                                                                                                        
|        |  |                                                                                                                                                                                                                                                                                                   
|31.2*** |  | Certification of Chief Financial Officer pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended.                                                                                                                                                                        



66







|32.1***  |  | Certification of Chief Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|-------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------
|         |  |                                                                                                                                                   
|32.2***  |  | Certification of Chief Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|         |  |                                                                                                                                                   
|101*     |  | Interactive Data Files of Financial Statements and Notes.                                                                                         
|         |  |                                                                                                                                                   
|101.ins* |  | Instant Document                                                                                                                                  
|         |  |                                                                                                                                                   
|101.sch* |  | XBRL Taxonomy Schema Document                                                                                                                     
|         |  |                                                                                                                                                   
|101.cal* |  | XBRL Taxonomy Calculation Linkbase Document                                                                                                       
|         |  |                                                                                                                                                   
|101.def* |  | XBRL Taxonomy Definition Linkbase Document                                                                                                        
|         |  |                                                                                                                                                   
|101.lab* |  | XBRL Taxonomy Label Linkbase Document                                                                                                             
|         |  |                                                                                                                                                   
|101.pre* |  | XBRL Taxonomy Presentation Linkbase Document                                                                                                      



|*   | Previously filed with the Annual Report on Form 10-K originally filed on March 15, 2017.                                                                                      
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|**  | Confidential Treatment has been requested as to certain portions of Exhibit. Such portions have been omitted and filed separately with the Securities and Exchange Commission.
|*** | Filed herewith                                                                                                                                                                
|†   | Management contract or compensatory plan or arrangement                                                                                                                       



67