8-K: Ekso Bionics Secures $2M Loan, Refinances Debt

Ekso Bionics Holdings, Inc. secured a new $2.0 million secured term loan from B. Riley Commercial Capital, LLC, simultaneously paying off and terminating its previous $2.0 million loan with Banc of California.

Summary

• Ekso Bionics Holdings, Inc. (the "Company") entered into a Secured Promissory Note and Security Agreement (the "Agreement") with B. Riley Commercial Capital, LLC (the "Lender") on September 12, 2025.
• The Agreement provides for a secured term loan of up to $2.0 million, intended for working capital and general corporate purposes.
• The loan bears interest at a rate of 10.0% per annum, payable in full on the Maturity Date.
• An exit fee of $200,000 (10% of the original principal amount) is also due on the Maturity Date.
• The loan matures on the earlier of the receipt of $2.4 million in net proceeds from a new equity investor financing (a "Qualified Financing") or September 14, 2026.
• The Lender has the option to convert the outstanding obligations (principal, interest, and Exit Fee) into equity securities of the Company in connection with a Qualified Financing, at the purchase price per share paid by the lead investor.
• The loan is guaranteed by Ekso Bionics, Inc., a subsidiary, and secured by substantially all of the personal property of the Company and its subsidiary.
• The Company simultaneously paid off and terminated its previous $2.0 million Loan and Security Agreement with Banc of California (formerly Pacific Western Bank), dated August 17, 2020.

Sentiment

Score: 6

Explanation: While the terms (10% interest, 10% exit fee, full collateralization, potential dilution) are somewhat expensive, securing $2.0 million in working capital and successfully refinancing existing debt is a necessary and positive step for ongoing operations. The conversion option provides a path for the lender to participate in upside, which can be attractive for growth companies. It's not overwhelmingly positive due to the cost of capital, but it addresses immediate financing needs.

Positives

• Secured $2.0 million in new financing, providing essential working capital for operations and general corporate purposes.
• Successfully refinanced existing debt, indicating proactive financial management and continuity of funding.
• The loan agreement allows for prepayment, offering flexibility, although with specific conditions.

Negatives

• The loan carries a high interest rate of 10.0% per annum.
• An additional 10% exit fee ($200,000) is payable on the principal amount, increasing the overall cost of borrowing.
• Prepayment terms are costly, requiring payment of accrued interest, interest that would have accrued through the Maturity Date, and the applicable Exit Fee.
• The loan is secured by substantially all personal property of the Company and its subsidiary, encumbering significant assets.
• The Lender's option to convert the loan into equity during a Qualified Financing could lead to dilution for existing shareholders.

Risks

• **Financial Covenants:** The Agreement includes customary affirmative and negative covenants, limiting the Company's ability to incur additional debt, grant liens, dispose of assets, and make certain restricted payments. Non-compliance could trigger an Event of Default.
• **Events of Default:** Various events, including non-payment, cross-defaults on other indebtedness exceeding $250,000, material contract defaults, material misrepresentation, breach of covenants, a Material Adverse Effect, or a Change of Control, could lead to acceleration of the loan obligations.
• **High Cost of Capital:** The combination of a 10.0% interest rate and a 10% exit fee represents a significant cost of capital, which could impact the Company's profitability and cash flow.
• **Dilution Risk:** The Lender's option to convert the loan into equity during a Qualified Financing poses a risk of dilution for current shareholders.
• **Security Interest:** The comprehensive security interest granted over substantially all personal property means that in the event of default, the Lender would have a priority claim on these assets.

Future Outlook

The loan proceeds are designated for working capital and general corporate purposes, supporting ongoing operations. The loan's maturity is explicitly tied to the Company's ability to secure a 'Qualified Financing' of at least $2.4 million, indicating a strategic intent for a future equity raise.

Management Comments

• Jerome Wong, Chief Financial Officer, signed the 8-K filing on behalf of Ekso Bionics Holdings, Inc.
• Scott Davis, Chief Executive Officer, signed the Secured Promissory Note and Security Agreement on behalf of Ekso Bionics Holdings, Inc. and Ekso Bionics, Inc.

Industry Context

Ekso Bionics operates in the specialized medical device and bionics industry, focusing on exoskeleton technology. Securing a term loan for working capital is a common financing strategy for companies in R&D-intensive and growth sectors. The relatively high interest rate and exit fee, along with comprehensive collateralization, suggest that Ekso Bionics may have a higher risk profile or limited access to more traditional, lower-cost financing options, which is not uncommon for innovative, smaller-cap companies in this space. The refinancing of an existing loan indicates ongoing capital management efforts to support its operational needs and strategic initiatives.

Comparison to Industry Standards

• The 10.0% interest rate and 10% exit fee are on the higher end compared to traditional corporate debt for well-established, profitable companies. However, for growth-stage companies in the medical device or bionics sector, which often have significant R&D expenses and may not yet be consistently profitable, such rates can be within the broader range for venture debt or specialized financing, reflecting a higher risk premium.
• The comprehensive collateralization of 'substantially all personal property' is a standard practice for secured loans to companies with limited unencumbered assets or those perceived to have a higher credit risk, aligning with typical secured lending practices for smaller, innovative firms.
• The inclusion of a conversion option for the lender into equity during a 'Qualified Financing' is a feature often found in venture debt or growth capital arrangements. This allows lenders to participate in the potential upside of a high-growth company, which is common in the technology and medical device industries where equity appreciation can be substantial.

Stakeholder Impact

• **Shareholders:** Face potential dilution if the Lender exercises its equity conversion option during a Qualified Financing. The high cost of debt (interest and exit fee) will impact the Company's earnings and could reduce shareholder value.
• **Employees:** The secured financing provides necessary working capital, supporting the Company's ongoing operations and employment.
• **Creditors:** The new loan is secured by substantially all personal property of the Company and its subsidiary, which could affect the recovery prospects of other unsecured creditors in a default scenario.

Next Steps

• Utilize the $2.0 million loan proceeds for working capital and general corporate purposes.
• Comply with all affirmative and negative covenants outlined in the Secured Promissory Note and Security Agreement.
• Prepare for a potential 'Qualified Financing' (equity raise of at least $2.4 million) which would trigger early maturity or conversion of the loan.
• Provide regular financial statements to the Lender, including audited annual statements (within 90 days), unaudited quarterly statements (within 45 days), and monthly accounts receivable balances and aging (within 30 days).

Key Dates

Recommendation

The company has successfully addressed its immediate financing needs by securing a $2.0 million term loan and refinancing existing debt. This provides necessary working capital for ongoing operations. However, the terms of the new loan, including a 10.0% interest rate, a 10% exit fee, and comprehensive collateralization, are relatively expensive and reflect a higher risk profile. The potential for future equity dilution through the lender's conversion option also warrants caution. While the financing ensures operational continuity, the cost of capital and potential dilution suggest a 'hold' recommendation, advising investors to monitor the company's execution, progress towards a Qualified Financing, and overall financial performance before making further investment decisions.

Keywords

Ekso Bionics, EKSO, Secured Promissory Note, Term Loan, Debt Financing, B. Riley Commercial Capital, Refinancing, Corporate Debt, Working Capital, Equity Conversion, Medical Devices, Exoskeletons