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 ☒ 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 ☒ No ☐

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

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. ☐

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

As of ~~November~~August 9, ~~2017, 16,158,619~~2018, 16,202,119 shares of common stock, par value $0.01, were outstanding.

Since our initial public offering, we have continued to qualify as an “emerging growth company” (“EGC”) as defined in the Jumpstart Our Business Startups Act of 2012 (the “JOBS Act”). An EGC may take advantage of specified reduced reporting requirements and is relieved of certain other significant requirements that are otherwise generally applicable to public companies.

We may choose to take advantage of some, but not all, of these reduced burdens. We will continue to operate under these provisions until December 31, 2018, or such earlier time that we are no longer an EGC. We would cease to be an EGC if we have more than $1.07 billion in annual revenues, qualify as a “large accelerated filer” under the Securities Exchange Act of 1934, as amended (the “Exchange Act”), which requires us to have more than $700 million in market value of our common stock held by non-affiliates, or issue more than $1.0 billion of non-convertible debt over a three-year period.

Condensed Statement of Consolidated Operations and Comprehensive Loss (Unaudited)

	Quarter Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30,						September 30,						June 30,						June 30,
	2017			2016			2017			2016			2018			2017			2018			2017
Revenue	$	15,887		$	12,988		$	37,555		$	33,157		$	10,857		$	10,799		$	22,750		$	21,668
Cost of sales		11,790			9,428			29,829			24,215			9,267			8,773			18,544			18,039
Gross profit		4,097			3,560			7,726			8,942			1,590			2,026			4,206			3,629
Operating expenses
Research and development		2,871			1,898			7,219			5,737			3,235			2,349			6,030			4,348
Selling, general and administrative		6,062			5,234			18,338			15,222			6,353			6,013			12,555			12,276
		8,933			7,132			25,557			20,959			9,588			8,362			18,585			16,624
Loss from operations		(4,836	)		(3,572	)		(17,831	)		(12,017	)		(7,998	)		(6,336	)		(14,379	)		(12,995	)
Other expense (income)
Interest expense		24			22			69			276			73			23			106			45
Other (income) expense ̶ net		(11	)		(8	)		134			(306	)		(52	)		35			(98	)		145
		13			14			203			(30	)		21			58			8			190
Loss before income taxes		(4,849	)		(3,586	)		(18,034	)		(11,987	)		(8,019	)		(6,394	)		(14,387	)		(13,185	)
Provision for income taxes		14			25			23			43			18			9			35			9
Net loss	$	(4,863	)	$	(3,611	)	$	(18,057	)	$	(12,030	)	$	(8,037	)	$	(6,403	)	$	(14,422	)	$	(13,194	)
Net loss per common share:
Basic	$	(0.30	)	$	(0.23	)	$	(1.13	)	$	(0.76	)	$	(0.50	)	$	(0.40	)	$	(0.89	)	$	(0.82	)
Diluted	$	(0.30	)	$	(0.23	)	$	(1.13	)	$	(0.76	)	$	(0.50	)	$	(0.40	)	$	(0.89	)	$	(0.82	)
Comprehensive loss:
Net loss	$	(4,863	)	$	(3,611	)	$	(18,057	)	$	(12,030	)	$	(8,037	)	$	(6,403	)	$	(14,422	)	$	(13,194	)
Other comprehensive income:
Other comprehensive (loss) income:
Foreign currency translation adjustments		1,194			489			4,713			2,288			(2,240	)		2,493			(838	)		3,519
Comprehensive loss	$	(3,669	)	$	(3,122	)	$	(13,344	)	$	(9,742	)	$	(10,277	)	$	(3,910	)	$	(15,260	)	$	(9,675	)

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

	September 30,			December 31,			June 30,			December 31,
	2017			2016			2018			2017
Assets
Current assets:
Cash and cash equivalents	$	17,706		$	27,825		$	11,584		$	21,848
Restricted cash		1,098			330			1,463			330
Accounts receivable ̶ net of allowance of $1,494 (2017) and $1,566 (2016)		6,539			6,447
Accounts receivable ̶ net of allowance of $1,122 (2018) and $1,193 (2017)								5,003			8,647
Inventories ̶ net		16,643			15,838			20,551			15,430
Prepaid expenses and other current assets		2,293			1,159			2,677			1,710
Total current assets		44,279			51,599			41,278			47,965
Property and equipment ̶ net		49,489			51,134			44,791			46,797
Intangible assets ̶ net		152			668			—			62
Other noncurrent assets		781			777			770			736
Total assets	$	94,701		$	104,178		$	86,839		$	95,560
Liabilities
Current liabilities:
Current portion of long-term debt	$	135		$	132		$	140		$	137
Current portion of capital leases		25			72			16			15
Accounts payable		4,311			2,036			4,756			4,291
Accrued expenses and other current liabilities		5,033			5,124			6,665			6,081
Deferred revenue and customer prepayments		7,533			7,371			13,460			8,282
Total current liabilities		17,037			14,735			25,037			18,806
Long-term debt ̶ net of current portion		1,543			1,644			1,437			1,508
Capital leases ̶ net of current portion		41			10			41			36
Other noncurrent liabilities		9			9			1			1
Total liabilities		18,630			16,398			26,516			20,351
Contingencies and commitments
Stockholders' equity
Common stock, $0.01 par value, 200,000,000 shares authorized, 16,092,114 (2017) and 16,017,115 (2016) shares issued and outstanding		161			160
Common stock, $0.01 par value, 200,000,000 shares authorized, 16,149,617 (2018) and 16,124,617 (2017) shares issued and outstanding								161			161
Additional paid-in capital		173,158			171,116			174,092			173,718
Accumulated deficit		(87,226	)		(68,761	)		(103,608	)		(89,186	)
Accumulated other comprehensive loss		(10,022	)		(14,735	)		(10,322	)		(9,484	)
Total stockholders' equity		76,071			87,780			60,323			75,209
Total liabilities and stockholders' equity	$	94,701		$	104,178		$	86,839		$	95,560

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

	Nine Months Ended						Six Months Ended
	September 30,						June 30,
	2017			2016			2018			2017
Operating activities
Net loss	$	(18,057	)	$	(12,030	)	$	(14,422	)	$	(13,194	)
Adjustments to reconcile net loss to net cash used for operations:
Depreciation and amortization		4,966			4,280			2,829			3,589
Equity-based compensation		2,043			1,104			374			835
Amortization of debt issuance costs		4			209			27			3
Deferred income taxes		—			(29	)
Recoveries for bad debts ̶ net		(51	)		(256	)
Provision (recoveries) for slow-moving, obsolete and lower of cost or market inventories ̶ net		1,872			(356	)
(Gain) loss from disposal of property and equipment ̶ net		(322	)		163
(Recoveries) provision for bad debts ̶ net								(37	)		132
Provision for slow-moving, obsolete and lower of cost or net realizable value inventories ̶ net								771			1,835
Gain from disposal of property and equipment ̶ net								(41	)		(314	)
Changes in assets and liabilities, excluding effects of foreign currency translation adjustments:
Decrease in accounts receivable		288			4,681			3,763			69
(Increase) decrease in inventories		(2,772	)		399
(Increase) decrease in prepaid expenses and other assets		(1,438	)		795
Increase (decrease) in accounts payable		2,032			(1,296	)
Decrease in accrued expenses and other liabilities		(522	)		(1,259	)
(Decrease) increase in deferred revenue and customer prepayments		(938	)		1,687
Increase in inventories								(7,060	)		(3,358	)
Increase in prepaid expenses and other assets								(658	)		(770	)
Increase in accounts payable								445			2,111
Increase (decrease) in accrued expenses and other liabilities								730			(252	)
Increase in deferred revenue and customer prepayments								5,406			2,390
Net cash used for operating activities		(12,895	)		(1,908	)		(7,873	)		(6,924	)
Investing activities
Capital expenditures		(874	)		(690	)		(819	)		(392	)
Proceeds from sale of property and equipment		3,702			52			25			3,677
Net cash provided by (used for) investing activities		2,828			(638	)
Net cash (used for) provided by investing activities								(794	)		3,285
Financing activities
Net proceeds from issuance of common stock ̶ registered direct offering to a related party		—			12,447
Net proceeds from issuance of common stock ̶ at the market offerings		—			595
Payments on long-term debt		(102	)		(102	)		(70	)		(68	)
Payments on capital leases		(64	)		(61	)		(9	)		(45	)
Net cash (used for) provided by financing activities		(166	)		12,879
Debt issuance costs								(188	)		—
Net cash used for financing activities								(267	)		(113	)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash		882			138			(197	)		760
Net change in cash, cash equivalents, and restricted cash		(9,351	)		10,471			(9,131	)		(2,992	)
Cash, cash equivalents, and restricted cash at beginning of period		28,155			19,672			22,178			28,155
Cash, cash equivalents, and restricted cash at end of period	$	18,804		$	30,143		$	13,047		$	25,163

Supplemental disclosure of noncash investing and financing activities
Transfer of internally developed 3D printing machines from inventories to property and equipment for internal use or leasing activities	$	2,363		$	2,666		$	895		$	1,917
Transfer of internally developed 3D printing machines from property and equipment to inventories for sale	$	597		$	1,276		$	424		$	395
Property and equipment acquired through financing arrangements	$	48		$	—		$	14		$	48
Unsettled proceeds from sale of property and equipment							$	51		$	—
Property and equipment included in accounts payable	$	94		$	15		$	95		$	100
Property and equipment included in accrued expenses and other current liabilities	$	84		$	—		$	23		$	—
Advance deposits on property and equipment	$	12		$	203
Debt issuance costs included in accounts payable							$	76		$	—

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

Condensed Statement of Changes in Consolidated Stockholders’ Equity (Unaudited)

											Accumulated															Accumulated
											other			Total												other			Total
	Common stock					Additional		Accumulated			comprehensive			stockholders'			Common stock				Additional		Accumulated			comprehensive			stockholders'
	Shares		$			paid-in capital		deficit			loss			equity
Balance at December 31, 2015		14,447	$	144		$	156,627	$	(54,163	)	$	(13,535	)	$	89,073
Registered direct offering of common stock to a related party, net of issuance costs		1,424		15			12,432		—			—			12,447
At the market offerings of common stock, net of issuance costs		92		1	��		594		—			—			595
Net loss		—		—			—		(12,030	)		—			(12,030	)
Other comprehensive income		—		—			—		—			2,288			2,288
Equity-based compensation		32		—			1,104		—			—			1,104
Balance at September 30, 2016		15,995	$	160		$	170,757	$	(66,193	)	$	(11,247	)	$	93,477
																	Shares		$		paid-in capital		deficit			loss			equity
Balance at December 31, 2016		16,017	$	160		$	171,116	$	(68,761	)	$	(14,735	)	$	87,780			16,017	$	160	$	171,116	$	(68,761	)	$	(14,735	)	$	87,780
Cumulative-effect adjustment due to the adoption of Financial Accounting Standards Board Accounting Standards Update 2016-16		—		—			—		(408	)		—			(408	)		—		—		—		(408	)		—			(408	)
Net loss		—		—			—		(18,057	)		—			(18,057	)		—		—		—		(13,194	)		—			(13,194	)
Other comprehensive income		—		—			—		—			4,713			4,713			—		—		—		—			3,519			3,519
Equity-based compensation		75		1			2,042		—			—			2,043			—		—		835		—			—			835
Balance at September 30, 2017		16,092	$	161		$	173,158	$	(87,226	)	$	(10,022	)	$	76,071
Common stock issued from equity incentive plan																		29		—		—		—			—			—
Balance at June 30, 2017																		16,046	$	160	$	171,951	$	(82,363	)	$	(11,216	)	$	78,532

Balance at December 31, 2017																		16,125	$	161	$	173,718	$	(89,186	)	$	(9,484	)	$	75,209
Net loss																		—		—		—		(14,422	)		—			(14,422	)
Other comprehensive loss																		—		—		—		—			(838	)		(838	)
Equity-based compensation																		—		—		374		—			—			374
Common stock issued from equity incentive plan																		25		—		—		—			—			—
Balance at June 30, 2018																		16,150	$	161	$	174,092	$	(103,608	)	$	(10,322	)	$	60,323

The accompanying notes are an integral part of these unaudited condensed consolidated financial statements.

The ExOne Company (“ExOne”) is a corporation organized under the laws of the state of Delaware. ExOne was formed on January 1, 2013, when The Ex One Company, LLC, a Delaware limited liability company, merged with and into a Delaware corporation, which survived and changed its name to The ExOne Company (the “Reorganization”). As a result of the Reorganization, The Ex One Company, LLC became ExOne, the common and preferred interest holders of The Ex One Company, LLC became holders of common stock and preferred stock, respectively, of ExOne, and the subsidiaries of The Ex One Company, LLC became the subsidiaries of ExOne. The condensed consolidated financial statements include the accounts of ExOne, its wholly-owned subsidiaries, ExOne Americas LLC (United States); ExOne GmbH (Germany); ExOne Property GmbH (Germany); ExOne KK (Japan); ExOne Italy S.r.l (Italy); and through December 2017, ExOne Sweden AB (Sweden)~~; and through September 2016, MWT—Gesellschaft für Industrielle Mikrowellentechnik mbH (Germany)~~. Collectively, the consolidated group is referred to as the “Company”.

On September 15, 2016, the Company completed a transaction merging its MWT—Gesellschaft für Industrielle Mikrowellentechnik mbH (Germany) subsidiary with and into its ExOne GmbH (Germany) subsidiary. The purpose of this transaction was to further simplify the Company’s legal structure. There were no significant accounting or tax related impacts associated with the merger of these wholly owned subsidiaries.

The Company filed a registration statement on Form S-3 ~~(No. 333-203353)~~(No. 333-223690) with the Securities and Exchange Commission (“SEC”) on ~~April 10, 2015.~~March 15, 2018. The purpose of the Form S-3 was to register, among other securities, debt securities. ~~Certain subsidiaries~~Subsidiaries of the Company ~~(other than any minor subsidiary)~~ are co-registrants with the Company (“Subsidiary Guarantors”), and the registration statement registered guarantees of debt securities by one or more of the Subsidiary Guarantors. The Subsidiary Guarantors are 100% owned by the Company and any guarantees by the Subsidiary Guarantors will be full and unconditional.

The condensed consolidated financial statements of the Company are unaudited. The condensed consolidated financial statements include all adjustments, consisting of normal recurring adjustments, considered necessary by management to fairly state the results of operations, financial position and cash flows of the Company. All material intercompany transactions and balances have been eliminated in consolidation. The results reported in these condensed consolidated financial statements are not necessarily indicative of the results that may be expected for the entire year. The December 31, ~~2016~~2017 condensed consolidated balance sheet data was derived from the audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America (“GAAP”). This Quarterly Report on Form 10-Q should be read in connection with the Company’s Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2017, which includes all disclosures required by GAAP.

The preparation of these condensed consolidated financial statements requires the Company to make certain judgments, estimates and assumptions regarding uncertainties that affect the reported amounts of assets, liabilities, revenue and expenses and related disclosure of contingent assets and liabilities. Areas that require significant judgments, estimates and assumptions include accounting for accounts receivable (including the allowance for doubtful accounts); inventories (including the allowance for slow-moving and obsolete inventories); product warranty reserves; contingencies; income taxes (including the valuation allowance on certain deferred tax assets and liabilities for uncertain tax positions); equity-based compensation (including the valuation of certain equity-based compensation awards issued by the Company); and testing for impairment of long-lived assets (including the identification of asset groups by management, estimates of future cash flows of identified asset groups and fair value estimates used in connection with assessing the valuation of identified asset groups). The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates.

Certain amounts relating to restricted cash ($330) and intangible assets – net ($668) in the accompanying condensed consolidated balance sheet at December 31, 2016, have been reclassified from prepaid expenses and other current assets and other noncurrent assets, respectively, to conform to current period presentation. Certain amounts relating to provision (recoveries) for slow-moving, obsolete and lower of cost or market inventories – net ($356) and amortization of debt issuance costs ($5) in the accompanying condensed statement of consolidated cash flows for the nine months ended September 30, 2016, have been reclassified from decrease in inventories and decrease in prepaid expenses and other assets, respectively, to conform to current period presentation.

On January 1, ~~2017,~~2018, the Company adopted Financial Accounting Standards Board (“FASB”) Accounting Standards Update (“ASU”)ASU 2017-09, “Compensation – Stock Compensation: Scope of Modification Accounting.” This ASU requires registrants to apply modification accounting unless three specific criteria are met. The three criteria are: the fair value of the award is the same before and after the modification, the vesting conditions are the same before and after the modification and the classification as a debt or equity award is the same before and after the modification. Management has determined that the adoption of this ASU did not have an impact on the consolidated financial statements of the Company.

On January 1, 2017, the Company adopted FASB ASU 2016-16, “Income Taxes: Intra-Entity Transfers of Assets Other Than Inventory.” This ASU modifies existing guidance and is intended to reduce diversity in practice with respect to the accounting for the income tax consequences of intra-entity transfers of assets. The ASU indicates that the former exception to income tax accounting that requires companies to defer the income tax effects of certain intercompany transactions would apply only to intercompany inventory transactions. That is, the exception no longer applies

to intercompany sales and transfers of other assets (e.g., property and equipment or intangible assets). Under the former exception, income tax expense associated with intra-entity profits in an intercompany sale or transfer of assets was eliminated from earnings. Instead, that cost was deferred and recorded on the balance sheet (e.g., as a prepaid asset) until the assets left the consolidated group. Similarly, the entity was prohibited from recognizing deferred tax assets for the increases in tax bases due to the intercompany sale or transfer. A modified retrospective basis of adoption was required for this ASU. As a result, a cumulative-effect adjustment of approximately $408 has been recorded to accumulated deficit on January 1, 2017, in

connection with this adoption. This cumulative-effect adjustment relates to the prepaid expense associated with intra-entity transfers of property and equipment included in prepaid expenses and other current assets ~~in the accompanying condensed consolidated balance sheet~~ at December 31, 2016.

On January 1, 2017, the Company adopted FASB ASU 2016-17, “Consolidation: Interests Held through Related Parties That Are under Common Control.” This ASU modifies former guidance with respect to how a decision maker that holds an indirect interest in a variable interest entity (“VIE”) through a common control party determines whether it is the primary beneficiary of the VIE as part of the analysis of whether the VIE would need to be consolidated. Under the ASU, a decision maker needs to consider only its proportionate indirect interest in the VIE held through a common control party. Previous guidance had required the decision maker to treat the common control party’s interest in the VIE as if the decision maker held the interest itself. The Company does not have significant involvement with entities subject to consolidation considerations impacted by VIE model factors addressed by this ASU. Management has determined that the adoption of this ASU did not have an impact on the condensed consolidated financial statements of the Company.

On January 1, 2017, the Company adopted FASB ASU 2015-11, “Inventory: Simplifying the Measurement of Inventory.” This ASU requires inventories to be measured at the lower of cost and net realizable value, with net realizable value defined as the estimated selling price in the normal course of business, less reasonably predictable costs of completion, disposal and transportation. ~~Management has determined that the adoption of this ASU did not have an impact on the condensed consolidated financial statements of the Company.~~

The Company considers the applicability and impact of all ASUs issued by the FASB. Recently issued ASUs not listed below either were assessed and determined to be ~~either~~ not applicable or are currently expected to have no impact on the consolidated financial statements of the Company.

In May 2017, the FASB issued ASU 2017-09, “Compensation – Stock Compensation: Scope of Modification Accounting.” This ASU requires registrants to apply modification accounting unless three specific criteria are met. The three criteria are: the fair value of the award is the same before and after the modification, the vesting conditions are the same before and after the modification and the classification as a debt or equity award is the same before and after the modification. This ASU becomes effective for the Company on January 1, 2018, and is to be applied prospectively to new awards granted after adoption. ~~Early adoption is permitted.~~ ~~Management is currently evaluating the potential impact of this ASU on the consolidated financial statements of the Company.~~

In August 2016, the FASB issued ASU 2016-15, “Statement of Cash Flows: Classification of Certain Cash Receipts and Cash Payments.” This ASU is intended to reduce diversity in practice in how certain cash receipts and payments are presented and classified in the statement of cash flows. The standard provides guidance in a number of situations including, among others, settlement of zero-coupon bonds, contingent consideration payments made after a business combination, proceeds from the settlement of insurance claims, and distributions received from equity method investees. The ASU also provides guidance for classifying cash receipts and payments that have aspects of more than one class of cash flows. This ASU becomes effective for the Company on January 1, 2019. Early adoption is permitted. Management is currently evaluating the potential impact of this ASU on the consolidated financial statements of the Company.

In February 2016, the FASB issued ASU 2016-02, “Leases.” As a result of this ASU, lessees will be required to recognize the following for all leases (with the exception of short-term leases) at the commencement date: a lease liability, which is a lessee’s obligation to make lease payments arising from a lease, measured on a discounted basis; and a right-of-use asset, which is an asset that represents the lessee’s right to use, or control the use of, a specified asset for the lease term. As a result of this ASU, lessor accounting is largely unchanged and lessees will no longer be provided with a source of off-balance sheet financing. This ASU becomes effective for the Company on January 1, 2019. Early adoption is permitted. Lessees (for capital and operating leases) and lessors (for sales-type, direct financing, and operating leases) must apply a modified retrospective transition approach for leases existing at, or entered into after, the beginning of the earliest comparative period presented in the consolidated financial statements. The modified retrospective approach would not require any transition accounting for leases that expired before the earliest comparative period presented. Lessees and lessors may not apply a full retrospective transition approach. Management is currently evaluating the potential impact of this ASU on the consolidated financial statements of the Company.

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers.” This ASU created a comprehensive framework for all entities in all industries to apply in the determination of when to recognize revenue and, therefore, supersedes virtually all existing revenue recognition requirements and guidance. This framework is expected to provide a consistent and comparable methodology for revenue recognition. The core principle of the guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve this principle, an entity should apply the following steps: identify the

contract(s) with a customer, identify the performance obligations in the contract(s), determine the transaction price, allocate the transaction price to the performance obligations in the contract(s), and recognize revenue when, or as, the entity satisfies a performance obligation. In August 2015, the FASB issued ASU 2015-14, “Revenue from Contracts with Customers: Deferral of the Effective Date,” which deferred the effective date of this guidance for the Company until January 1, 2019, or January 1, 2018, in the event that the Company no longer qualifies as an EGC. Early adoption is permitted, but the Company may adopt the changes no earlier than January 1, 2017 (regardless of EGC status).2019. Management is currently evaluating the potential impact of these collective changes on the consolidated financial statements of the Company. The Company plans to utilize the modified retrospective method in connection with its future adoption of this ASU, as amended.

On February 6, 2013, the Company commenced an initial public offering of 6,095,000 shares of its common stock at a price to the public of $18.00 per share, of which 5,483,333 shares of common stock were sold by the Company and 611,667 shares of common stock were sold by a selling stockholder (including consideration of the exercise of the underwriters’ over-allotment option). The Company received approximately $90,371 in unrestricted net proceeds in connection with this offering (net of underwriting commissions and offering costs).

On September 9, 2013, the Company commenced a secondary public offering of 3,054,400 shares of its common stock at a price to the public of $62.00 per share, of which 1,106,000 shares of common stock were sold by the Company and 1,948,400 shares of common stock were sold by selling stockholders (including consideration of the exercise of the underwriters’ over-allotment option). The Company received approximately $64,948 in unrestricted net proceeds in connection with this offering (net of underwriting commissions and offering costs).

On January 8, 2016, the Company announced that it had entered into an At Market Issuance Sales Agreement (“ATM”) with FBR Capital Markets & Co. (“FBR”) and MLV & Co. LLC (“MLV”) pursuant to which FBR and MLV agreed to act as distribution agents in the sale of up to $50,000 in the aggregate of ExOne common stock ~~in “at the market offerings” as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities Act”).~~ Both FBR and MLV were identified as related parties to the Company on the basis of significant influence in that a member of the Board of Directors of the Company also served as a member of the Board of Directors of FBR (which controlled MLV). The terms of the ATM were reviewed and approved by a sub-committee of the Board of Directors of the Company (which included each of the members of the Audit Committee of the Board of Directors except for the identified director who also held a position on the Board of Directors of FBR). This related party determination ended on June 1, 2017, when the identified director ceased serving as a member of the Board of Directors of FBR. Terms of the ATM require a 3.0% commission on the sale of common stock under the ATM and an initial reimbursement of certain legal expenses of $25. During the quarter ended March 31, 2016, the Company sold 91,940 shares of common stock under the ATM at a weighted average selling price of approximately $9.17 per share resulting in gross proceeds to the Company of approximately $843. Unrestricted net proceeds to the Company from the sale of common stock under the ATM during the quarter ended March 31, 2016 were approximately $595 (after deducting offering costs of approximately $248, including certain legal, accounting and administrative costs associated with the ATM, of which approximately $50 was paid to FBR or MLV relating to the aforementioned initial reimbursement of certain legal expenses and commissions on the sale of common stock under the ATM). There have been no sales of shares of common stock under the ATM during any periods subsequent to the quarter ended March 31, 2016.

On January 11, 2016, the Company announced that it had entered into a subscription agreement with Rockwell Forest Products, Inc. and S. Kent Rockwell for the registered direct offering and sale of 1,423,877 shares of ExOne common stock at a per share price of $9.13 (a $0.50 premium from the closing price on the close of business on January 8, 2016). Both Rockwell Forest Products, Inc. and S. Kent Rockwell were identified as related parties to the Company as S. Kent Rockwell served as Chairman and CEO of the Company and was the controlling shareholder of Rockwell Forest Products, Inc. at the time of the transaction. The terms of this transaction were reviewed and approved by a sub-committee of independent members of the Board of Directors of the Company (which included each of the members of the Audit Committee of the Board of Directors). The sub-committee of independent members of the Board of Directors of the Company were advised on the transaction by an independent financial advisor and independent legal counsel. Concurrent with the approval of this sale of common stock under the terms identified, a separate sub-committee of independent members of the Board of Directors of the Company approved the termination of the Company’s revolving credit facility with RHI Investments, LLC. Following completion of the registered direct offering on January 13, 2016, the Company received gross proceeds of approximately $13,000. Unrestricted net proceeds to the Company from the sale of common stock in the registered direct offering were approximately $12,447 (after deducting offering costs of approximately $553).

The Company has incurred a net loss in each of its annual periods since its inception. As shown in the accompanying condensed statement of consolidated operations and comprehensive loss, the Company incurred a net loss of approximately ~~$4,863~~$8,037 and ~~$18,057~~$14,422 for the ~~quarter~~three and ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018, respectively. ~~As noted above,~~Since its inception, the Company has received cumulative unrestricted net proceeds from the sale of its common stock (through its initial public offering and subsequent secondary offerings) of approximately $168,361 to fund its operations. At ~~September~~June 30, ~~2017,~~2018, the Company had approximately ~~$17,706~~$11,584 in unrestricted cash and cash equivalents.

In March 2018 the Company entered into a three-year, $15,000 revolving credit facility with a related party (Note 11) to provide additional funding for working capital and general corporate purposes.

In June 2018 the Company initiated a global cost realignment program focused on a reduction in the Company’s production overhead costs and operating expenses.

Management believes that the Company’s existing capital resources will be sufficient to support the Company’s operating plan. If management anticipates that the Company’s actual results will differ from its operating plan, management believes it has sufficient capabilities to enact cost savings measures to preserve ~~capital. Further,~~capital (in addition to the costs savings measures associated with the Company’s global cost realignment program further described above). The Company may also seek to raise additional capital to support its growth through additional debt, equity or other alternatives (including asset sales) or a combination thereof.

The following table summarizes changes in the components of accumulated other comprehensive loss:

	Quarter Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30,						September 30,						June 30,						June 30,
Foreign currency translation adjustments	2017			2016			2017			2016			2018			2017			2018			2017
Balance at beginning of period	$	(11,216	)	$	(11,736	)	$	(14,735	)	$	(13,535	)	$	(8,082	)	$	(13,709	)	$	(9,484	)	$	(14,735	)
Other comprehensive income		1,194			489			4,713			2,288
Other comprehensive (loss) income														(2,240	)		2,493			(838	)		3,519
Balance at end of period	$	(10,022	)	$	(11,247	)	$	(10,022	)	$	(11,247	)	$	(10,322	)	$	(11,216	)	$	(10,322	)	$	(11,216	)

Foreign currency translation adjustments consist of the effect of translation of functional currency financial statements (denominated in the euro and Japanese yen) to the reporting currency of the Company (United States dollar) and certain long-term intercompany transactions between subsidiaries for which settlement is not planned or anticipated in the foreseeable future.

There were no tax impacts related to income tax rate changes and no amounts were reclassified to earnings for either of the periods presented.

The Company presents basic and diluted loss per common share amounts. Basic loss per common share is calculated by dividing net loss available to common stockholders by the weighted average number of common shares outstanding during the applicable period. Diluted loss per common share is calculated by dividing net loss available to common stockholders by the weighted average number of common shares and common equivalent shares outstanding during the applicable period.

As the Company incurred a net loss during each of the ~~quarters~~three months and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, basic average common shares outstanding and diluted average common shares outstanding were the same because the effect of potential shares of common stock, including stock options ~~(696,137~~(536,635 – ~~2017~~2018 and ~~317,637~~351,137 – ~~2016)~~2017) and unvested restricted stock issued ~~(67,505~~(52,502 – ~~2017~~2018 and ~~112,504~~83,670 – ~~2016)~~2017), was anti-dilutive.

The information used to compute basic and diluted net loss per common share was as follows:

	Quarter Ended						Nine Months Ended						Three Months Ended						Six Months Ended
	September 30,						September 30,						June 30,						June 30,
	2017			2016			2017			2016			2018			2017			2018			2017
Net loss	$	(4,863	)	$	(3,611	)	$	(18,057	)	$	(12,030	)	$	(8,037	)	$	(6,403	)	$	(14,422	)	$	(13,194	)
Weighted average shares outstanding (basic and diluted)		16,069,453			15,997,146			16,048,257			15,912,628			16,149,617			16,045,949			16,144,092			16,037,475
Net loss per common share:
Basic	$	(0.30	)	$	(0.23	)	$	(1.13	)	$	(0.76	)	$	(0.50	)	$	(0.40	)	$	(0.89	)	$	(0.82	)
Diluted	$	(0.30	)	$	(0.23	)	$	(1.13	)	$	(0.76	)	$	(0.50	)	$	(0.40	)	$	(0.89	)	$	(0.82	)

In December 2017 the Company committed to a plan to consolidate certain of its three-dimensional (“3D”) printing operations from its Desenzano del Garda, Italy facility into its Gersthofen, Germany facility. These actions were taken as part of the Company’s efforts to optimize its business model and maximize its facility utilization. During the three months ended December 31, 2017, the Company recorded a charge of approximately $72 split between cost of sales ($19) and selling, general and administrative expense ($53) associated with involuntary employee terminations related to this plan. During the three months ended March 31, 2018, the Company recorded an additional charge of approximately $245 associated with other exit costs ($17) and asset impairments ($228) related to this plan. During the three months ended June 30, 2018, the Company recorded an additional charge of approximately $13 associated with asset impairments related to this plan. In addition, during the three months ended June 30, 2018, the Company recorded a gain from disposal of certain property and equipment of approximately $51 (recorded to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss). Charges associated with other exit costs recorded during the six months ended June 30, 2018 were recorded to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss. Charges associated with asset impairments recorded during the three and six months ended June 30, 2018 were recorded to cost of sales as a component of depreciation expense in the accompanying condensed statement of consolidated operations and comprehensive loss. Other exit costs relate to the remaining facility rent due under a non-cancellable operating lease following the cessation of operations at the facility in January 2018. Asset impairment charges relate to certain leasehold improvements associated with the exited facility and other equipment which was abandoned by the Company. There are no additional charges expected to be incurred associated with this plan in future periods. The Company settled all amounts associated with involuntary employee terminations and facility rentals during the six months ended June 30, 2018.

In January 2017 the Company committed to a plan to consolidate certain of its 3D printing operations from its North Las Vegas, Nevada facility into its Troy, Michigan and Houston, Texas facilities and exit its non-core specialty machining operations in its Chesterfield, Michigan facility. These actions were taken as a result of the accelerating adoption rate of the Company’s ~~sand~~indirect printing technology in North America which ~~has~~ resulted in a refocus of the Company’s operational strategy.

As a result of these actions, during the ~~quarter~~three months ended March 31, 2017, the Company recorded charges of approximately $984, including approximately $110 associated with involuntary employee terminations, approximately $7 associated with other exit costs and approximately $867 associated with asset impairments. Charges associated with involuntary employee terminations and other exit costs were recorded to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss. Charges associated with asset impairments were split between cost of sales ($598), as a component of depreciation expense, and selling, general and administrative expenses ($269), as a component of amortization expense, in the accompanying condensed statement of consolidated operations and comprehensive loss. During the ~~quarter~~three months ended June 30, 2017, the Company recorded aan additional charge of approximately $32 associated with an additional involuntary employee termination which required a service commitment through April 2017. This charge was recorded to cost of sales in the accompanying condensed statement of operations and comprehensive loss. ~~There have been no additional charges recorded associated with this plan in subsequent periods.~~ There are no additional charges expected to be incurred associated with this plan in future periods. The Company ~~has~~ settled all amounts associated with involuntary employee terminations and other exit ~~costs.~~costs during 2017.

Charges associated with asset impairments relate principally to the Company’s plan to exit its non-core specialty machining operations in its Chesterfield, Michigan facility. On April 21, 2017, the Company sold to a third party certain assets associated with these operations including inventories (approximately $79), property and equipment (approximately $2,475) and other contractual

rights (approximately $269). Total gross proceeds from the sale of these assets were approximately $2,050. After deducting costs directly attributable to the sale of these assets (approximately $128), the Company recorded an impairment loss during the ~~quarter~~three months ended March 31, 2017, of approximately $859 split between property and equipment ($590) and intangible assets ($269) based on the excess of the carrying value over the estimated fair value of the related assets at March 31, 2017. During the three months ended June 30, 2017, ~~and~~the Company recorded a loss on disposal ~~(recorded~~of approximately $42. Both the impairment loss and the loss on disposal were recorded to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss) during the quarter ended June 30, 2017, of approximately $42. Additionally, the Company recorded an impairment loss during the quarter ended March 31, 2017, of approximately $8 associated with certain property and equipment which was abandoned in connection with the Company’s exit of its North Las Vegas, Nevada facility.loss.

Separate from the transaction described above, on May 9, 2017, the Company sold to a third party certain property and equipment (principally land and building) associated with its North Las Vegas, Nevada facility. Total gross proceeds from the sale of these assets were approximately $1,950. After deducting costs directly attributable to the sale of these assets (approximately $137), the Company recorded a gain on disposal (recorded to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss) during the ~~quarter~~three months ended June 30, 2017, of approximately $347.

~~In April 2016,~~ Additionally, the Company ~~committed to a plan to consolidate~~recorded an impairment loss during the three months ended March 31, 2017, of approximately $8 associated with certain ~~of its 3D printing operations~~property and equipment which was abandoned in ~~its Auburn, Washington facility into~~connection with the Company’s exit of its North Las Vegas, Nevada facility and reorganize certain of its corporate departments as part of its 2016 operating plan. As a result of these actions, during the quarter ended June 30, 2016, the Company incurred a net charge of approximately $170 including, $57 associated with involuntary employee terminations and $113 associated with the disposal of certain property and equipment related to the Auburn, Washington facility which was either sold or abandoned. This net charge was split between cost of sales ($129), research and development ($2) and selling, general and administrative expenses ($39) in the accompanying statement of consolidated operations and comprehensive loss. In addition to the net charge incurred by the Company in connection with this plan, the Company also has an operating lease commitment for the Auburn, Washington facility with a lease term through December 2018. At the time of closure of this facility, the Company was able to secure a firmly committed sublease arrangement with a third party which fully offsets its remaining contractual operating lease liability. ~~There have been no additional charges recorded associated with this plan in subsequent periods.~~ ~~There are no additional charges expected to be incurred associated with this plan in future periods. The Company has settled all amounts associated with involuntary employee terminations.~~facility.

During the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018, as a result of continued operating losses and cash flow deficiencies, the Company identified a triggering event requiring a test for the recoverability of long-lived assets held ~~for use~~and used at the asset group level. Assessing the recoverability of long-lived assets held ~~for use~~and used requires significant judgments and estimates by management.

For purposes of testing long-lived assets for recoverability, the Company operates as three separate asset groups: United States, Europe and Japan. In assessing the recoverability of long-lived assets held ~~for use,~~and used, the Company determined the carrying amount of long-lived assets held ~~for use~~and used to be in excess of the estimated future undiscounted net cash flows of the related assets. The Company proceeded to determine the fair value of its long-lived assets held ~~for use,~~and used, principally through use of the market approach. The Company’s use of the market approach included consideration of market transactions for comparable assets. Management concluded that the fair value of long-lived assets held ~~for use~~and used exceeded their carrying value and as such no impairment loss was recorded.

A significant decrease in the market price of a long-lived asset, adverse change in the use or condition of a long-lived asset, adverse change in the business climate or legal or regulatory factors impacting a long-lived asset and continued operating losses and cash flow deficiencies associated with a long-lived asset, among other indicators, could cause a future assessment to be performed which may result in an impairment of long-lived assets held ~~for use,~~and used, resulting in a material adverse effect on the financial position and results of operations of the Company.

The following provides a reconciliation of cash, cash equivalents, and restricted cash as reported in the accompanying condensed consolidated balance sheet to the same such amounts shown in the accompanying condensed statement of consolidated cash flows:

	September 30,		December 31,		June 30,		December 31,
	2017		2016		2018		2017
Cash and cash equivalents	$	17,706	$	27,825	$	11,584	$	21,848
Restricted cash		1,098		330		1,463		330
Cash, cash equivalents, and restricted cash shown in the condensed statement of consolidated cash flows	$	18,804	$	28,155
Cash, cash equivalents, and restricted cash					$	13,047	$	22,178

Restricted cash at ~~September~~June 30, ~~2017~~2018 includes approximately ~~$768~~$963 associated with cash collateral required by a German bank for ashort-term financial ~~guarantee~~guarantees issued by ExOne GmbH in connection with acertain commercial ~~transaction~~transactions requiring ~~security.~~ security (Note 10). Restricted cash at ~~both September~~June 30, ~~2017~~2018 and December 31, ~~2016~~2017 includes approximately $500 and $330, respectively, associated with cash collateral required by a United States bank to offset certain short-term, unsecured lending commitments associated with the Company’s corporate credit card program. Each of the balances described are considered legally restricted by the Company.

	September 30,		December 31,		June 30,		December 31,
	2017		2016		2018		2017
Raw materials and components	$	7,306	$	7,429	$	9,092	$	7,171
Work in process		6,253		5,166		6,334		4,630
Finished goods		3,084		3,243		5,125		3,629
	$	16,643	$	15,838	$	20,551	$	15,430

Raw materials and components consist of consumable materials and component parts and subassemblies associated with 3D printing machine manufacturing and support activities. Work in process consists of 3D printing machines and other products in varying stages of completion. Finished goods consist of 3D printing machines and other products prepared for sale in accordance with customer specifications.

At ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, the allowance for slow-moving and obsolete inventories was approximately ~~$3,364~~$4,026 and ~~$1,517,~~$3,437, respectively, and has been reflected as a reduction to inventories (principally raw materials and components). ~~Included~~

During the three months ended June 30, 2018, the Company recorded a charge of approximately $561 to cost of sales in the ~~allowance for slow-moving~~accompanying condensed statement of consolidated operations and ~~obsolete inventories at September 30, 2017, is approximately $1,631 related~~comprehensive loss attributable to certain ~~raw material~~industrial microwave inventories based on a sustained absence of demand for such curing solutions and ~~component inventories associated with~~a decision by the ~~Company’s Exerial 3D printing machine platform (see further discussion below).~~Company to discontinue future manufacturing of such industrial microwaves.

During the ~~quarter~~three months ended June 30, 2017, the Company recorded a charge of approximately $1,460 to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss attributable to certain raw material and component inventories (principally machine frames and other fabricated components) associated with the Company’s Exerial 3D printing machine platform based on decisions made by the Company during the period related to certain design changes ~~and improvements~~ to the underlying platform (rendering certain elements of the previous design obsolete).

During the ~~quarter~~three and six months ended June 30, ~~2016,~~2018, the Company recorded a net credit of approximately ~~$507 to cost of sales in the accompanying condensed statement of consolidated operations~~($15) and comprehensive loss attributable to the reversal of a previously recorded reserve for certain inventories associated with the Company’s laser micromachining product line which was discontinued at the end of 2014, based on the sale of such laser micromachining inventories during the period.

~~During the quarter and nine months ended September 30, 2017, the Company recorded a (credit) charge of approximately~~ ($~~11) and $116,~~30), respectively, to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss associated with certain ~~work in process~~ inventories for which cost was determined to exceed net realizable value. ~~There were no such credits or charges recorded by~~During the three and six months ended June 30, 2017, the Company ~~during~~recorded a net (credit) charge of approximately ($79) and $127, respectively, to cost of sales in the ~~quarter or nine months ended September 30, 2016.~~accompanying

condensed statement of consolidated operations and comprehensive loss associated with certain inventories for which cost was determined to exceed net realizable value.

Substantially all of the Company’s 3D printing machines are covered by a standard twelve month warranty. Generally, at the time of sale, a liability is recorded (with an offset to cost of sales) based upon the expected cost of replacement parts and labor to be incurred over the life of the standard warranty. Expected cost is estimated using historical experience for similar products. The Company periodically assesses the adequacy of the product warranty reserves based on changes in these factors and records any necessary adjustments if actual experience indicates that adjustments are necessary. Future claims experience could be materially different from prior results because of the introduction of new, more complex products, a change in the Company’s warranty policy in response to industry trends, competition or other external forces, or manufacturing changes that could impact product quality. In the event that the Company determines that its current or future product repair and replacement costs exceed estimates, an adjustment to these reserves would be charged to cost of sales in the period such a determination is made.

The following table summarizes changes in product warranty reserves (such amounts reflected in accrued expenses and other current liabilities in the accompanying condensed consolidated balance sheet for each respective period):

On ~~July~~March 1, ~~2017,~~2018, the Company’s ExOne GmbH subsidiary notified Voxeljet AG that it has materially breached a 2003 Patent and Know-How Transfer Agreement and asserted its rights to set-off damages as a result of the breaches against the annual license fee due from the Company (through its ExOne GmbH subsidiary) entered into a Settlement Agreement with Kocel Foundry Limited (also known as Kocel CSR Casting Company, Limited) and Kocel Group (Hong Kong) Limited (collectively, “Kocel”) relating to settlement ofunder the ~~arbitration case (no. 100019-2017) administered by the Swiss Chambers’ Arbitration Institution Notice of Arbitration, as filed by~~agreement. At this time, the Company ~~on January 25, 2017. Among other things, the Settlement Agreement provided for~~cannot reasonably estimate a ~~cash payment from ExOne GmbH to Kocel of approximately $811 and a settlement and release of claims~~contingency, if any, related to ~~a sales agreement between the parties for certain 3D printing machines and related equipment (the “Sales Agreement”).~~ Based on the terms of the Settlement Agreement, including the final acceptance by Kocel of the 3D printing machines and related equipment, and relief from further obligation, liability or warranty for both parties (excluding certain intellectual property considerations), the Company recorded revenue of approximately $2,762 associated with the Sales Agreement (net of the cash payment made by ExOne GmbH to Kocel, such payment made on July 5, 2017) and the related cost of sales, during the quarter ending September 30, 2017.this matter.

The Company and its subsidiaries are subject to various litigation, claims, and proceedings which have been or may be instituted or asserted from time to time in the ordinary course of business. ~~Other than the matter further described above, management~~Management does not believe that the outcome of any pending or threatened matters will have a material adverse effect, individually or in the aggregate, on the financial position, results of operations or cash flows of the Company.

In the normal course of its operations, ExOne GmbH issues short-term financial guarantees and letters of credit to third parties in connection with certain commercial transactions requiring security. ExOne GmbH maintains a credit facility ~~agreement~~ with a German bank which provides for various short-term financings in the form of overdraft credit, financial guarantees, letters of credit and collateral security for commercial transactions for an aggregate of approximately $1,500 (€1,300). In addition, ExOne GmbH may use the credit facility ~~agreement~~ for short-term, fixed-rate loans in minimum increments of approximately $100 (€100) with minimum terms of at least ~~thirty~~30 days. The overdraft credit interest rate is fixed at 10.2% while the interest rate associated with commercial transactions requiring security (financial guarantees, letters of credit or collateral security) is fixed at 1.75%. The credit facility ~~agreement~~ has an indefinite term and is subject to cancellation by either party at any time upon repayment of amounts outstanding or expiration of commercial transactions requiring security. There is no commitment fee associated with the credit ~~facility agreement.~~facility. There are no negative covenants associated with the credit ~~facility agreement.~~facility. The credit facility ~~agreement~~ has been guaranteed by the Company. At ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, there were no outstanding borrowings in the form of overdraft credit or short-term loans under the credit facility. At June 30, 2018, total outstanding financial guarantees and letters of credit issued by ExOne GmbH under the credit facility ~~agreement.~~were approximately $963 (€824) with expiration dates ranging from July 2018 through July 2019. At ~~September 30,~~December 31, 2017, total outstanding financial guarantees and letters of credit issued by ExOne GmbH under the credit facility ~~agreement~~ were approximately ~~$865~~$1,128 (€~~732)~~941). ~~Included in~~

In connection with the ~~total~~related party revolving credit facility agreement entered into by the Company on March 12, 2018 (Note 11), the Company was required to post cash collateral against outstanding financial guarantees and letters of credit ~~issued by ExOne GmbH are approximately $584 (€494)~~associated with ~~expiration dates ranging from~~ ~~October~~ ~~2017 through July 2018 and approximately $281 (€238) which have no expiration date. At December 31, 2016, total outstanding guarantees and letters of credit issued by ExOne GmbH under~~ the credit facility ~~agreement were approximately $400 (€380)~~(Note 7).

In addition to amounts issued by ExOne GmbH under the credit facility, ~~agreement, during the quarter ended March 31, 2017,~~from time to time, ExOne GmbH ~~entered~~enters into separate agreements with the same German bank for additional capacity for financial guarantees and letters of credit associated with certain commercial transactions requiring security. Terms of the separate agreements are substantially similar to those of the existing credit ~~security~~

facility. At June 30, 2018, ExOne GmbH had a singular financial guarantee outstanding under a separate agreement ~~except that~~for approximately $93 (€80) with an expiration date of June 2022. Related to this separate agreement, the requirement for cash collateral was waived by the German bank ~~required cash collateral to be posted by ExOne GmbH~~as it also represents the counterparty in ~~connection with any~~the related issuance. At September 30, 2017, total outstanding financial guarantees and letters of credit issued by ExOne GmbH under these separate agreements were approximately $768 (€650) which expired in October 2017.transaction.

On March 12, 2018, ExOne and its ExOne Americas LLC and ExOne GmbH subsidiaries, as guarantors (collectively, the “Loan Parties”), entered into a Credit Agreement and related ancillary agreements with LBM Holdings, LLC (“LBM”), a company controlled by S. Kent Rockwell, who was the Executive Chairman of the Company (a related party) at such date, relating to a $15,000 revolving credit facility (the “LBM Credit Agreement”) to provide additional funding for working capital and general corporate purposes. The LBM Credit Agreement provides for a term of three years (through March 12, 2021) and bears interest at a rate of one month LIBOR plus an applicable margin of 500 basis points (approximately 6.7% and 7.1% at inception and June 30, 2018, respectively). The LBM Credit Agreement requires a commitment fee of 75 basis points, or 0.75%, on the unused portion of the facility, payable monthly in arrears. In addition, an up-front commitment fee of 125 basis points, or 1.25% (approximately $188), was required at closing. Borrowings under the LBM Credit Agreement are required to be in minimum increments of $1,000. ExOne may terminate or reduce the credit commitment at any time during the term of the LBM Credit Agreement without penalty. ExOne may also make prepayments against outstanding borrowings under the LBM Credit Agreement at any time without penalty. Borrowings under the LBM Credit Agreement have been collateralized by the accounts receivable, inventories and machinery and equipment of the Loan Parties. At inception and June 30, 2018 the total estimated value of collateral was in significant excess of the maximum borrowing capacity under the LBM Credit Agreement.

The LBM Credit Agreement contains several affirmative covenants including prompt payment of liabilities and taxes; maintenance of insurance, properties, and licenses; and compliance with laws. The LBM Credit Agreement also contains several negative covenants including restricting the incurrence of certain additional debt; prohibiting future liens (other than permitted liens); prohibiting investment in third parties; limiting the ability to pay dividends; limiting mergers, acquisitions, and dispositions; and limiting the sale of certain property and equipment of the Loan Parties. The LBM Credit Agreement does not contain any financial covenants. The LBM Credit Agreement also contains events of default, including, but not limited to, cross-default to certain other debt, breaches of representations and warranties, change of control events and breaches of covenants.

LBM was determined to be a related party based on common control by S. Kent Rockwell, who was the Executive Chairman of the Company at the time the Company entered into the LBM Credit Agreement and effective June 20, 2018, became the Chairman and Chief Executive Officer of the Company. Accordingly, the Company does not consider the LBM Credit Agreement indicative of a fair market value lending. Prior to execution, the LBM Credit Agreement was subject to review and approval by a sub-committee of independent members of the Board of Directors of the Company (which included each of the members of the Audit Committee of the Board of Directors). At the time of execution of the LBM Credit Agreement, the $15,000 in available loan proceeds were deposited into an escrow account with an unrelated, third party financial institution pursuant to a separate Escrow Agreement by and among the parties. Loan proceeds held in escrow are available to the Company upon its submission to the escrow agent of a loan request. Such proceeds will not be available to LBM until payment in-full of the obligations under the LBM Credit Agreement and termination of the LBM Credit Agreement. Payments of principal and other obligations will be made to the escrow agent, while interest payments will be made directly to LBM. Provided there exists no potential default or event of default, the LBM Credit Agreement and Escrow Agreement prohibit any acceleration of repayment of any amount outstanding under the LBM Credit Agreement and prohibit termination of the LBM Credit Agreement or withdrawal from escrow of any unused portion of the LBM Credit Agreement.

There were no borrowings by the Company under the LBM Credit Agreement from March 12, 2018 (inception) through June 30, 2018.

The Company incurred approximately $264 in debt issuance costs associated with the LBM Credit Agreement (including the aforementioned up front commitment fee paid at closing to LBM). During the three and six months ended June 30, 2018, the Company recorded interest expense relating to the LBM Credit Agreement of approximately $49 and $59, respectively. Included in interest expense for the three and six months ended June 30, 2018 was approximately $21 and $25, respectively, associated with amortization of debt issuance costs (resulting in approximately $239 in remaining debt issuance costs at June 30, 2018, of which $88 was included in prepaid expenses and other current assets and $151 was included in other noncurrent assets in the accompanying condensed consolidated balance sheet). Included in interest expense for the three and six months ended June 30, 2018 was approximately $28 and $34, respectively, associated with the commitment fee on the unused portion of the revolving credit facility, of which at June 30, 2018 approximately $9 was included in accounts payable in the accompanying condensed consolidated balance sheet. Amounts payable to LBM at June 30, 2018 were settled by the Company in July 2018.

The provision for income taxes for the ~~quarters~~three months ended ~~September~~June 30, 2018 and 2017 was approximately $18 and ~~2016 was $14 and $25,~~$9, respectively. The provision for income taxes for the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017 was approximately $35 and ~~2016 was $23 and $43,~~$9, respectively. The Company has completed a discrete period computation of its provision for income taxes for each of the periods presented. ~~Discrete~~The discrete period computation iswas required as a result of jurisdictions with losses before income taxes for which no tax benefit can be

recognized and an inability to generate reliable estimates for results in certain jurisdictions as a result of inconsistencies in generating net operating profits (losses) in those jurisdictions.

The effective tax rate for the ~~quarters~~three months ended ~~September~~June 30, 2018 and 2017 ~~and 2016~~ was ~~0.3%~~0.2% (provision on a loss) and ~~0.7%~~0.1% (provision on a loss), respectively. The effective tax rate for the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017 ~~and 2016~~ was ~~0.1%~~0.2% (provision on a loss) and ~~0.4%~~0.1% (provision on a loss), respectively. The effective tax rate differs from the United States federal statutory rate of 21.0% (2018) and 34.0% (2017) for each of the periods presented primarily due to net changes in valuation allowances for the periods.

In December 2017, the Tax Cuts and Jobs Act (the “Tax Act”) was enacted into law. The Tax Act reduces the corporate income tax rate from 34% to 21% and generally modifies certain United States income tax deductions and the United States taxation of certain foreign earnings, among other changes. The Company is required to recognize the effect of tax law changes in the period of enactment. As a result of the Tax Act, the Company re-measured its United States deferred tax assets and liabilities as well as its valuation allowance against its net United States deferred tax assets at December 31, 2017. In December 2017, the SEC staff issued Staff Accounting Bulletin No. 118: Income Tax Accounting Implications of the 2017 Tax Cuts and Jobs Act (“SAB 118”), which allows the Company to record provisional amounts during a measurement period not to extend beyond one year of the enactment date. As ongoing guidance and accounting interpretations are expected over the next year, the Company considers its accounting of the deferred tax re-measurements and other items to be incomplete due to the forthcoming guidance and its ongoing analysis of final December 31, 2017 data and tax positions. No provisional amounts have been recorded by the Company. The Company expects to complete its analysis within the measurement period in accordance with SAB 118.

The Company has provided a valuation allowance for its net deferred tax assets as a result of the Company not generating consistent net operating profits in jurisdictions in which it operates. As such, any benefit from deferred taxes in any of the periods presented has been fully offset by changes in the valuation allowance for net deferred tax assets. The Company continues to assess its future taxable income by jurisdiction based on recent historical operating results, the expected timing of reversal of temporary differences, various tax planning strategies that the Company may be able to enact in future periods, the impact of potential operating changes on the business and forecast results from operations in future periods based on available information at the end of each reporting period. To the extent that the Company is able to reach the conclusion that its net deferred tax assets are realizable based on any combination of the above factors in a single, or in multiple, taxing jurisdictions, a reversal of the related portion of the Company’s existing valuation allowances may occur.

The Company has a liability for uncertain tax positions related to certain capitalized expenses and intercompany transactions. At ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, the liability for uncertain tax positions was approximately ~~$846~~$837 and ~~$754,~~$858, respectively, and iswas included in accrued expenses and other current liabilities in the accompanying condensed consolidated balance sheet. At ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, the Company had an additional liability for uncertain tax positions related to its ExOne GmbH (Germany) subsidiary of approximately ~~$304~~$345 and ~~$232,~~$323, respectively, which were fully offset against net operating loss carryforwards. At ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, the Company had an additional liability for uncertain tax positions related to its ExOne KK (Japan) subsidiary of approximately ~~$554~~$689 and ~~$416,~~$594, respectively, which were fully offset against net operating loss carryforwards.

In July 2017, local taxing authorities in Japan completed their examination of the Company’s ExOne KK (2014-2016) subsidiary, resulting in an income tax obligation of approximately $5, which was reflected in the provision for income taxes in the accompanying condensed statement of consolidated operations during the quarter ended At June 30, ~~2017. At September 30, 2017,~~2018, the Company’s ExOne GmbH (2010-2013) and ExOne Property GmbH (2013) subsidiaries were under examination by local taxing authorities. The Company is unable to reasonably predict an outcome related to this examination, the result of which may be material in a future period to the financial position, results from operations and cash flows of the Company.

On January 24, 2013, the Board of Directors of the Company adopted the 2013 Equity Incentive Plan (the “Plan”). In connection with the adoption of the Plan, 500,000 shares of common stock were reserved for issuance pursuant to the Plan, with automatic increases in such reserve available each year annually on January 1 from 2014 through 2023 equal to the lesser of 3.0% of the total outstanding shares of common stock as of December 31 of the immediately preceding year or, a number of shares of common stock determined by the Board of Directors, provided that the maximum number of shares authorized under the Plan will not exceed 1,992,241 shares, subject to certain adjustments. The maximum number of shares of common stock are currently reserved for issuance under the Plan.

Stock options and restricted stock issued by the Company under the Plan are generally subject to service conditions resulting in annual vesting on the anniversary of the date of grant over a period typically ranging between one and three years. Certain stock options and restricted stock issued by the Company under the Plan vest immediately upon issuance. Stock options issued by the Company under the Plan have a contractual ~~life~~lives which ~~expires~~expire over a period typically ranging between five and ten years from the date of grant subject to continued service to the Company by the participant.

On February 7, 2018, the Compensation Committee of the Board of Directors of the Company adopted the 2018 Annual Incentive Program (the “Program”) as a subplan under the Plan. The Program provides an opportunity for performance-based compensation to senior executive officers of the Company, among others. The target annual incentive for each Program participant is expressed as a percentage of base salary and is conditioned on the achievement of certain financial goals (as approved by the Compensation Committee of the Board of Directors) or a combination of financial and non-financial goals. The Compensation Committee of the Board of Directors retains negative discretion over amounts payable under the Program. For 2018, the total target amount payable under the Program is approximately $1,423, with certain amounts to be settled with participants in cash, equity or a combination

thereof. During the three and six months ended June 30, 2018, total compensation expense associated with the Program was approximately $163 and $305, respectively, split between cost of sales ($24 and $45, respectively), research and development ($47 and $90, respectively) and selling general and administrative expenses ($92 and $170, respectively) in the accompanying condensed statement of consolidated operations and comprehensive loss, of which approximately $132 is expected to be settled in equity by the Company.

The following table summarizes the total equity-based compensation (benefit) expense recognized ~~for awards issued under~~by the ~~Plan:~~Company:

	Quarter Ended				Nine Months Ended				Three Months Ended					Six Months Ended
	September 30,				September 30,				June 30,					June 30,
	2017		2016		2017		2016		2018			2017		2018		2017
Equity-based compensation expense recognized:
Equity-based compensation (benefit) expense recognized:
Stock options	$	768	$	347	$	1,244	$	490	$	(175	)	$	133	$	28	$	476
Restricted stock		440		203		799		614		100			141		206		359
Other^(a)										70			—		140		—
Total equity-based compensation expense before income taxes		1,208		550		2,043		1,104		(5	)		274		374		835
Benefit for income taxes*		—		—		—		—
Benefit for income taxes^(b)										—			—		—		—
Total equity-based compensation expense net of income taxes	$	1,208	$	550	$	2,043	$	1,104	$	(5	)	$	274	$	374	$	835

At ~~September~~June 30, ~~2017,~~2018, total future compensation expense related to unvested awards yet to be recognized by the Company was approximately ~~$1,145~~$228 for stock options and ~~$449~~$284 for restricted stock. Total future compensation expense related to unvested awards

yet to be recognized by the Company is expected to be recognized over a weighted-average remaining vesting period of approximately ~~1.3~~1.2 years.

During the ~~nine~~six months ended ~~September~~June 30, 2018, the fair value of stock options granted was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:

During the six months ended June 30, 2017, the fair value of stock options granted was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:

~~During the nine months ended September 30, 2016, the fair value of stock options granted was estimated on the date of grant using the Black-Scholes option pricing model with the following assumptions:~~

For certain stock option awards, volatility is estimated based on the historical volatility of the Company when the expected term of the award is less than the period for which the Company has been publicly traded. For certain stock option awards, volatility is estimated based on the historical volatilities of certain peer group companies when the expected term of the award exceeds the period for which the Company has been publicly traded. The average risk-free rate is based on a weighted average yield curve of risk-free interest rates consistent with the expected term of the awards. Expected dividend yield is based on historical dividend data as well as future expectations. Expected term is calculated using the simplified method as the Company does not have sufficient historical exercise experience upon which to base an estimate.

	Nine Months Ended														Six Months Ended June 30,
	2017							2016							2018							2017
	Number of Options			Weighted Average Exercise Price		Weighted Average Grant Date Fair Value		Number of Options			Weighted Average Exercise Price		Weighted Average Grant Date Fair Value		Number of Options			Weighted Average Exercise Price		Weighted Average Grant Date Fair Value		Number of Options			Weighted Average Exercise Price		Weighted Average Grant Date Fair Value
Outstanding at beginning of period		314,303		$	15.62	$	9.38		210,970		$	17.43	$	10.67		674,470		$	11.58	$	6.41		314,303		$	15.62	$	9.38
Stock options granted		389,000		$	8.16	$	3.89		139,000		$	13.72	$	8.00		24,000		$	8.36	$	3.77		44,000		$	10.10	$	5.51
Stock options exercised		—		$	—	$	—		—		$	—	$	—		—		$	—	$	—		—		$	—	$	—
Stock options forfeited		(500	)	$	15.74	$	9.60		(6,001	)	$	15.74	$	9.60		(133,835	)	$	9.44	$	5.15		(500	)	$	15.74	$	9.60
Stock options expired		(6,666	)	$	17.43	$	10.67		(26,332	)	$	17.74	$	10.87		(28,000	)	$	10.03	$	5.19		(6,666	)	$	17.43	$	10.67
Outstanding at end of period		696,137		$	11.51	$	6.35		317,637		$	15.77	$	9.48		536,635		$	12.05	$	6.68		351,137		$	15.04	$	8.96
Stock options exercisable at end of period		427,953		$	12.67	$	7.16		178,304		$	17.01	$	10.32		396,627		$	13.14	$	7.53		226,471		$	15.72	$	9.43
Stock options expected to vest at end of period		268,184		$	9.66	$	5.06		132,908		$	14.18	$	8.38		140,008		$	8.96	$	4.29		124,666		$	13.80	$	8.11

At ~~September~~June 30, ~~2017,~~2018, there was no intrinsic value associated with stock options exercisable ~~was approximately $586. At September 30, 2017, intrinsic value associated with stock options~~or expected to ~~vest was approximately $659.~~vest. The weighted average remaining contractual term of stock options exercisable and expected to vest at ~~September~~June 30, ~~2017,~~2018, was approximately ~~6.7~~3.8 years and ~~7.2~~5.0 years, respectively. There were no stock option exercises during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 or ~~2016.~~2017.

	Nine Months Ended										Six Months Ended June 30,
	2017					2016					2018					2017
	Shares of Restricted Stock			Weighted Average Grant Date Fair Value		Shares of Restricted Stock			Weighted Average Grant Date Fair Value		Shares of Restricted Stock			Weighted Average Grant Date Fair Value		Shares of Restricted Stock			Weighted Average Grant Date Fair Value
Outstanding at beginning of period		94,171		$	14.29		77,670		$	19.57		52,502		$	11.07		94,171		$	14.29
Restricted stock granted		60,000		$	9.01		74,500		$	11.78		25,000		$	8.21		30,000		$	10.10
Restricted stock vested		(74,999	)	$	12.40		(35,998	)	$	19.25		(25,000	)	$	10.10		(28,834	)	$	14.69
Restricted stock forfeited		(11,667	)	$	14.28		(3,668	)	$	19.46		—		$	—		(11,667	)	$	14.28
Outstanding at end of period		67,505		$	11.69		112,504		$	14.52		52,502		$	10.17		83,670		$	12.65
Restricted stock expected to vest at end of period		67,505		$	11.69		112,504		$	14.52		52,502		$	10.17		83,670		$	12.65

Restricted stock ~~vested~~vesting during the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, had a fair value of approximately ~~$670~~$205 and ~~$351,~~$299, respectively.

Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities which are required to be recorded at fair value, the Company considers the principal or most advantageous market in which the Company would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions and credit risk.

The Company applies the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement:

The Company is required to disclose its estimate of the fair value of material financial instruments, including those recorded as assets or liabilities in its consolidated financial statements, in accordance with GAAP.

During the ~~quarter~~three months ended March 31, 2017, the Company entered into two separate foreign exchange forward contracts with a German bank in an effort to hedge the variability of certain foreign exchange risks between the ~~Euro~~euro (the functional currency of the Company’s ExOne GmbH subsidiary) and the British ~~Pound Sterling~~pound sterling (the currency basis for cash flows resulting from a commercial sales arrangement with a customer). The first of the two foreign exchange forward contracts was both entered into and settled (in connection with cash received from the customer) during the ~~quarter~~three months ended March 31, 2017, resulting in a realized gain on settlement of approximately $16 (€15). The second of the two foreign exchange forward contracts ~~was settled on August 31,~~remained outstanding at June 30, 2017, ~~resulting in a realized~~and during the three and six months ended June 30, 2017, generated an unrealized gain ~~on settlement~~ of approximately ~~$14~~$5 (€~~12)~~4). Neither of the contracts was designated as a hedging instrument and accordingly, realized and unrealized gains (losses) ~~for all periods~~ have been recorded to other (income) expense – net in the accompanying condensed statement of consolidated operations and comprehensive loss. The Company ~~has~~ classified both contracts as Level 2 fair value measurements. There were no such contracts entered into by the Company during the six months ended June 30, 2018. There were no such contracts outstanding at either June 30, 2018 or December 31, 2017.

The carrying values and fair values of other financial instruments (assets and liabilities) not required to be recorded at fair value were as follows:

	September 30,				December 31,				June 30,				December 31,
	2017				2016				2018				2017
	Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value		Carrying Value		Fair Value
Cash and cash equivalents	$	17,706	$	17,706	$	27,825	$	27,825	$	11,584	$	11,584	$	21,848	$	21,848
Restricted cash	$	1,098	$	1,098	$	330	$	330	$	1,463	$	1,463	$	330	$	330
Current portion of long-term debt*	$	135	$	140	$	132	$	138
Debt issuance costs^(a)									$	239	$	—	$	—	$	—
Current portion of long-term debt^(b)									$	140	$	145	$	137	$	142
Current portion of capital leases	$	25	$	25	$	72	$	72	$	16	$	16	$	15	$	15
Long-term debt ̶ net of current portion*	$	1,543	$	1,570	$	1,644	$	1,674
Long-term debt ̶ net of current portion^(b)									$	1,437	$	1,459	$	1,508	$	1,533
Capital leases ̶ net of current portion	$	41	$	41	$	10	$	10	$	41	$	41	$	36	$	36

* ~~Carrying values at September 30, 2017 and December 31, 2016 are net of unamortized debt issuance costs of approximately $32 and $36, respectively.~~

The carrying amounts of cash and cash equivalents, restricted cash, current portion of long-term debt and current portion of capital leases approximate fair value due to their short-term maturities. The fair value of long-term debt – net of current portion and capital leases – net of current portion have been estimated by management based on the consideration of applicable interest rates (including certain instruments at variable or floating rates) and other available information (including quoted prices of similar instruments available to the Company). Cash and cash equivalents and restricted cash are classified in Level 1; current portion of long-term debt, current portion of capital leases, long-term debt – net of current portion and capital leases – net of current portion are classified in Level 2.

During the ~~quarters~~three months and ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, the Company conducted a significant portion of its business with a limited number of customers, though not necessarily the same customers for each respective period. For the ~~quarters~~three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, the Company’s five most significant customers represented approximately ~~46.0%~~33.0% and ~~36.0%~~37.4% of total revenue, respectively. For the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, the Company’s five most significant customers represented approximately ~~22.2%~~25.2% and ~~21.4%~~25.7% of total revenue, respectively. At ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, accounts receivable from the Company’s five most significant customers were approximately ~~$2,293~~$1,156 and ~~$1,867,~~$4,199, respectively.

Sales of products and/or services to related parties for the ~~quarters~~three and six months ended ~~September~~June 30, 2017 ~~and 2016~~ were approximately $8$9 and ~~$1, respectively. Sales of products and/or services to related parties for the nine months ended September 30, 2017 and 2016 were approximately $25 and $73,~~$17, respectively. None of the transactions met a threshold requiring review and approval by the Audit Committee of the Board of Directors of the Company. There were no sales of products and/or services to related parties during the six months ended June 30, 2018.

There were no amounts due from related parties at ~~September~~June 30, ~~2017.Amounts due~~2018 or December 31, 2017.

Purchases of products and/or services from related parties ~~at December 31, 2016,~~during the three months ended June 30, 2018 and 2017, were approximately $1$6 and ~~are reflected in accounts receivable – net in the accompanying condensed consolidated balance sheet. In addition, the Company has received prepayments for certain undelivered~~$5, respectively. Purchases of products and/or services to a related party of approximately $8 at September 30, 2017, which are reflected in deferred revenue and customer prepayments in the accompanying condensed consolidated balance sheet. There were no prepayments received from related parties ~~at December 31, 2016.~~

~~During~~during the ~~quarters ended September 30, 2017 and 2016, purchases from related parties were approximately $4 and $3, respectively. During the nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016, purchases from related parties~~2017, were approximately $12 and ~~$13,~~$8, respectively. Purchases of products and/or services by the Company during each of the ~~quarters and nine months ended September 30, 2017 and 2016~~respective periods included website design services and leased office space from related parties under common control by S. Kent Rockwell, who is the Chairman and Chief Executive Officer of the Company and prior to June 20, 2018, was the Executive Chairman of the ~~Company (formerly the Chairman and CEO of the Company through August 19, 2016).~~Company. None of the transactions met a threshold requiring review and approval by the Audit Committee of the Board of Directors of the Company.

The Company also receives the benefit of the corporate use of an airplane from a related party under common control by the Executive Chairman of the Company (formerly the Chairman and CEO of the Company through August 19, 2016) for no consi~~deration.~~ The Company estimates the fair market value of the benefits received during the quarter and nine months ended September 30, 2016 were approximately $17 and $21, respectively. There were no such benefits received during the quarter or nine months ended September 30, 2017.

Amounts due to related parties at ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016,~~2017, were approximately $1$2 and $1, respectively. Amounts due to related parties for both periods are reflected in accounts payable in the accompanying condensed consolidated balance sheet.

On October 23, 2015, ExOne and its ExOne Americas LLC and ExOne GmbH subsidiaries, as guarantors, entered into a Credit Agreement (the “Credit Agreement”) with RHI Investments, LLC (“RHI”), a related party, on a $15,000 revolving credit facility to (i) assist the Company in its efforts to finance customer acquisition of its 3D printing machines and 3D printed and other products and services and (ii) provide additional funding for working capital and general corporate purposes. RHI was determined to be a related party based on common control by the former Chairman and CEO of the Company (the Executive Chairman of the Company effective August 19, 2016). Prior to execution, the Credit Agreement was subject to review and approval by a sub-committee of independent members of the Board of Directors of the Company (which included each of the members of the Audit Committee of the Board of Directors). The Company incurred approximately $215 in debt issuance costs associated with the Credit Agreement.

On January 10, 2016, the Company delivered notice to RHI of its intent to terminate the Credit Agreement in connection with the closing of a registered direct offering of common stock to an entity under common control by the former Chairman and CEO of the Company ~~(the Executive Chairman of the Company effective August 19, 2016)~~. There were no borrowings under the Credit Agreement from January 1, 2016 through the effective date of its termination, January 13, 2016. In connection with the termination, the Company settled its remaining accrued interest under the Credit Agreement of approximately $5 relating to the commitment fee on the unused portion of the revolving credit facility ~~(100 basis points, or 1.0% on the unused portion of the revolving credit facility)~~. In addition, during the quarter ended March 31, 2016, the Company recorded approximately $204 to interest expense related to the accelerated amortization of debt issuance costs. Upon termination of the Credit Agreement, all liens and guaranties in respect thereof were released.

Refer to Note 211 for further discussion relating to ~~two separate equity offerings during the quarter ended March 31, 2016, certain elements of which qualified as~~a revolving credit facility with a related party ~~transactions.~~ entered into in March 2018.

The Company has evaluated all of its activities and concluded that no subsequent events have occurred that would require recognition in the condensed consolidated financial statements or disclosure in the notes to the condensed consolidated financial statements.

The following discussion and analysis should be read together with our unaudited condensed consolidated financial statements and related notes thereto set forth in this Quarterly Report on Form 10-Q as well as our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017.

This Quarterly Report on Form 10-Q may contain forward-looking statements within the meaning of the Private Securities Litigation Reform Act with respect to our future financial or business performance, strategies, or expectations. Forward-looking statements typically are identified by words or phrases such as “trend,” “potential,” “opportunity,” “pipeline,” “believe,” “comfortable,” “expect,” “anticipate,” “current,” “intention,” “estimate,” “position,” “assume,” “outlook,” “continue,” “remain,” “maintain,” “sustain,” “seek,” “achieve,” as well as similar expressions, or future or conditional verbs such as “will,” “would,” “should,” “could” and “may.”

We caution that forward-looking statements are subject to numerous assumptions, risks and uncertainties, which change over time. Forward-looking statements speak only as of the date they are made and we assume no duty to and do not undertake to update forward-looking statements. Actual results could differ materially from those anticipated in forward-looking statements and future results could differ materially from historical performance.

In addition to items described under “Risk Factors” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2017, the following factors, among others, could cause results to differ materially from forward-looking statements or historical performance: our ability to generate operating profits; fluctuations in our revenues and operating results; the results of our global cost realignment initiative; our competitive environment and our competitive position; our ability to enhance our current 3D printing machines and technology and develop new 3D printing machines; our ability to qualify more industrial materials in which we can print; ~~timing and length of sales of3D printing machines;~~ demand for our products; ~~our ability to achieve cost savings through consolidation~~ ~~or exiting of certain North American operations; the impact of increases in operating expenses and expenses relating to proposed investments and alliances;~~ the availability of skilled personnel; the impact of loss of key management; the impact of market conditions and other factors on the ~~carrying~~carrying value of long-lived assets;~~our competitive environment and our competitive position;~~ our ability to continue as a going concern; ~~individual customer contractual requirements;~~ the impact of customer specific terms in machine sale agreements on the ~~period~~period in which we recognize revenue; ~~the impact of loss of key management;~~ risks related to global operations ~~including~~in cluding effects of foreign ~~currency~~currency; the adequacy of sources of liquidity; the amount and ~~risks related to the situation in the Ukraineand the United Kingdom’s referendum to withdraw from the European Union;~~demand for aerospace, automotive, heavy equipment, energy/oil/gas and other industrial products; our plans regarding increased international operations in additional international locations; the scope, nature or impact of alliances and strateg ~~ic investments and our ability to integrate strategic investments;~~ sufficiency of funds for required capital expenditures, working capital, and debt service; ~~the adequacy~~dependency on certain critical suppliers; nature or impact of ~~sources of liquidity;~~alliances and str ategic investments; reliance on critical information technology systems; the effect of ~~litigation,~~litigation, contingencies and warranty claims;liabilities under laws and regulations protecting the environment; the impact of governmental laws and regulations; operating hazards, war, terrorism and cancellation or unavailability of insurance coverage; the impact of disruption of our manufacturing facilities, ~~production service centers~~Production Service Centers (“PSCs”) or ExOne ~~adoption centers~~Adoption Centers (“EACs”); the adequacy of our protection of our intellectual property; and expectations regarding demand for our industrial products, operating revenues, operating and maintenance expenses, ~~insuran~~ceinsurance expenses and deductibles, interest expenses, debt levels, and other matters with regard to ~~outlook; andmaterial weaknesses in our internal control over financial reporting~~outlook.

We are a global provider of 3D printing machines and 3D printed and other products, materials and services to industrial customers. Our business primarily consists of manufacturing and selling 3D printing machines and printing products to specification for our customers using our installed base of 3D printing machines. Our machines serve direct and indirect applications. Direct printing produces a component; indirect printing makes a tool to produce a component. We offer pre-production collaboration and print products for customers through our network of PSCs and EACs. We also supply the associated materials, including consumables and replacement parts, and other services, including training and technical support that is necessary for purchasers of our 3D printing machines to print products. We believe that our ability to print in a variety of industrial materials, as well as our industry-leading volumetric output (as measured by build box size and printing speed) uniquely position us to serve the needs of industrial customers.

In April 2018 we completed the introduction of our newest direct 3D printing machine, the Innovent+. Based on the Innovent platform, the Innovent+ system comes with our new ultrasonic recoater designed for material flexibility and ease of use. We believe that the ultrasonic recoater is the most advanced powder dispensing technology in the market. It can be quickly removed for system cleaning or powder change over. Each recoater comes with four screen configurations which allow for greater material compatibility. Expanded dust collection options have been localized to pull powder from around the buildbox and utilize a dust particulate remover with variable control. Expanded dust collection options are compatible with both the Innovent and the Innovent+ 3D printing machine platforms.

~~Recent Developments~~administrative expenses by approximately $250. We expect to invest these cost savings into technological or process advancements that support either long-term cost benefits or revenue growth.

On In January ~~26,~~ 2017 we committed to a plan to consolidate certain of our 3D printing operations from our North Las Vegas, Nevada facility into our Troy, Michigan and Houston, Texas facilities and exit our non-core specialty machining operations in our Chesterfield, Michigan facility. These actions were taken as a result of thethe accelerating adoption rate of our ~~sand~~indirect printing technology in North America which ~~has~~ resulted in a refocus of our operational strategy.

As a result of these actions, during the ~~quarter~~three months ended March 31, 2017, we recorded charges of approximately $984, including approximately $110 associated with involuntary employee terminations, approximately $7 associated with other exit costs and approximately $867 associated with asset impairments. Charges associated with involuntary employee terminations and other exit costs were recorded to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss. Charges associated with asset impairments were split between cost of sales ($598), as a component of depreciation expense, and

selling, general and administrative expenses ($269), as a component of amortization expense, in the accompanying condensed statement of consolidated operations and comprehensive loss. During the ~~quarter~~three months ended June 30, 2017, we recorded aan additional charge of approximately $32 associated with an additional involuntary employee termination which required a service commitment through April 2017. This charge was recorded to cost of sales in the accompanying condensed statement of operations and comprehensive loss. There ~~have been no additional charges recorded associated with this plan in subsequent periods. There~~ are no additional charges expected to be incurred associated with this plan in future periods. We ~~have~~ settled all amounts associated with involuntary employee terminations and other exit ~~costs.~~costs during 2017.

Charges associated with asset impairments relate principally to our plan to exit our non-core specialty machining operations in our Chesterfield, Michigan facility. On April 21, 2017, we sold to a third party certain assets associated with these operations including inventories (approximately $79), property and equipment (approximately $2,475) and other contractual rights (approximately $269). Total gross proceeds from the sale of these assets were approximately $2,050. After deducting costs directly attributable to the sale of these assets (approximately $128), we recorded an impairment loss during the ~~quarter~~three months ended March 31, 2017, of approximately $859 split between property and equipment ($590) and intangible assets ($269) based on the excess of the carrying value over the estimated fair value of the related assets at March 31, 2017. During the three months ended June 30, 2017, ~~and~~we recorded a loss on disposal ~~(recorded~~of approximately $42. Both the impairment loss and the loss on disposal were recorded to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss) during the quarter ended June 30, 2017, of approximately $42. Additionally, we recorded an impairment loss during the quarter ended March 31, 2017, of approximately $8 associated with certain property and equipment which was abandoned in connection with our plan to exit our North Las Vegas, Nevada facility.loss.

Separate from the transaction described above, on May 9, 2017, we sold to a third party certain property and equipment (principally land and building) associated with our North Las Vegas, Nevada facility. Total gross proceeds from the sale of these assets were approximately $1,950. After deducting costs directly attributable to the sale of these assets (approximately $137), we recorded a gain on disposal (recorded to cost of sales in the accompanying condensed statement of consolidated operations and comprehensive loss) during the ~~quarter~~three months ended June 30, 2017, of approximately $347. Additionally, we recorded an impairment loss during the three months ended March 31, 2017, of approximately $8 associated with certain property and equipment which was abandoned in connection with our exit of our North Las Vegas, Nevada facility.

The consolidation of our 3D printing operations from our North Las Vegas, Nevada facility into our Troy, Michigan and Houston, Texas facilities is not expected to have a significant impact on our revenues in future periods. We expect annualized cost savings related to this consolidation of approximately $600, with approximately $570 in the form of cash cost savings (principally ~~employee~~employee-related and ~~facility maintenance~~other operating costs) and approximately $30 in the form of reduced depreciation expense. All cost savings associated with this consolidation are expected to benefit cost of sales. We expect to invest these cost savings into technological or process advancements that support either long-term cost benefits or revenue growth.

We expect annualized reductions in revenue related to our exit of our non-core specialty machining operations in our Chesterfield, Michigan facility of approximately $1,400. Revenues associated with our non-core specialty machining operations in our Chesterfield, Michigan facility were approximately $39 and $346 for the ~~nine~~three and six months ended ~~September~~June 30, 2017, ~~and approximately $427 and $1,075 for the quarter and nine months ended September 30, 2016,~~ respectively. We expect annualized cost savings related to this exit of approximately $500, with approximately $200 in the form of cash cost savings (principally employee-related and other operating costs), approximately $200 in the form of reduced depreciation expense and approximately $100 in the form of reduced amortization expense. Cost savings associated with the exit of this facility are expected to benefit cost of sales by approximately $400 and selling, general and administrative expenses by approximately $100. We expect to invest these cost savings into technological or process advancements that support either long-term cost benefits or revenue growth.

On March 22, 2017, we terminated our Cooperation Agreement with Swerea SWECAST AB (“Swerea”), resulting in an exit of our PSC operations in Jönköping, Sweden, effective April 1, 2017. Also on March 22, 2017, we agreed to a leasing agreement with Beijer Industri AB, effective April 1, 2017, related to our 3D printing machine and related equipment located on the Swerea premises, previously covered under our Cooperation Agreement with Swerea. Both of these actions were taken in connection with our continuing evaluation of our business model in an effort to both streamline our existing European operations, and to take strategic advantage of our existing relationship with Beijer Industri AB in promoting indirect binder jet technologies in Scandinavia. There were no penalties or other adverse effects associated with our termination of our Cooperation Agreement with Swerea. There were no significant effects on our results of operations or financial position associated with these actions.

During the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018, as a result of continued operating losses and cash flow deficiencies, we identified a triggering event requiring a test for the recoverability of long-lived assets held ~~for use~~and used at the asset group level. Assessing the recoverability of long-lived assets held ~~for use~~and used requires significant judgments and estimates by management.

For purposes of testing long-lived assets for recoverability, we operate as three separate asset groups: United States, Europe and Japan. In assessing the recoverability of long-lived assets held ~~for use,~~and used, we determined the carrying amount of long-lived assets held ~~for use~~and used to be in excess of the estimated future undiscounted net cash flows of the related assets. We proceeded to determine the fair value of our long-lived assets held ~~for use,~~and used, principally through use of the market approach. Our use of the market approach included consideration of market transactions for comparable assets. Management concluded that the fair value of long-lived assets held ~~for use~~and used exceeded their carrying value and as such no impairment loss was recorded.

At ~~September~~June 30, ~~2017,~~2018, our backlog was approximately ~~$20,900~~$26,600 of which approximately ~~$17,900~~$24,400 is expected to be fulfilled during the next twelve months. At December 31, ~~2016,~~2017, our backlog was approximately ~~$19,700.~~$21,300.

Net loss for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018 was ~~$4,863,~~$8,037, or ~~$0.30~~$0.50 per basic and diluted share, compared with a net loss of ~~$3,611~~$6,403 or ~~$0.23~~$0.40 per basic and diluted share, for the ~~quarter~~three months ended ~~September~~June 30, ~~2016.~~2017. Net loss for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018, was ~~$18,057,~~$14,422, or ~~$1.13~~$0.89 per basic and diluted share, compared with a net loss of ~~$12,030~~$13,194 or ~~$0.76~~$0.82 per basic and diluted share, for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2017. The increase in our net loss for ~~both periods~~the three month period was principally due to a ~~net~~ decrease in our gross profit, ~~(as a percentage of sales) along with~~as well as increases in ~~research~~our operating expenses (research and development and selling, general and administrative expense) (all changes further described below). The increase in our net loss for the six month period was principally due to an increase in our operating expenses offset by an increase in our revenues and gross profit (all changes further described below).

	Quarter Ended								Nine Months Ended								Three Months Ended								Six Months Ended
	September 30,								September 30,								June 30,								June 30,
	2017				2016				2017				2016				2018				2017				2018				2017
3D printing machines	$	8,552	53.8	%	$	6,489	50.0	%	$	17,081	45.5	%	$	13,461	40.6	%	$	3,213	29.6	%	$	4,256	39.4	%	$	7,734	34.0	%	$	8,529	39.4	%
3D printed and other products, materials and services		7,335	46.2	%		6,499	50.0	%		20,474	54.5	%		19,696	59.4	%		7,644	70.4	%		6,543	60.6	%		15,016	66.0	%		13,139	60.6	%
	$	15,887	100.0	%	$	12,988	100.0	%	$	37,555	100.0	%	$	33,157	100.0	%	$	10,857	100.0	%	$	10,799	100.0	%	$	22,750	100.0	%	$	21,668	100.0	%

Revenue for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018 was ~~$15,887~~$10,857, compared with revenue of ~~$12,988~~$10,799 for the ~~quarter~~three months ended ~~September~~June 30, ~~2016,~~2017, an increase of ~~$2,899,~~$58, or ~~22.3%~~0.5%. The increase in revenue ~~was as a result of increases~~resulted from an increase in revenue attributable to ~~both of~~ our ~~product lines (3D printing machines and~~ 3D printed and other products, materials and ~~services). The increase~~services product group, offset by a decrease in revenues ~~from~~attributable to our 3D printing machines resulted from a slightly higher volume of units sold (12 3D printing machines sold during the quarter ended September 30, 2017, as compared to 11 3D printing machines sold during the quarter ended September 30, 2016) and a favorable mix of 3D printing machines sold (as we sold eight indirect printers during the quarter ended September 30, 2017, as compared to six indirect printers during the quarter ended September 30, 2016, indirect printers generally bearing a higher average selling price than direct printers).product group. The increase in revenues from 3D printed and other products, materials and services principally resulted from an increase in revenues from our direct PSC printing operations as a result of increased customer acceptance of our binder jet technologies and an increase in consumable material and service revenues (maintenance services and replacement components for 3D printing machines) based on an increased global installed base of 3D printing ~~machines. These increases~~machines along with favorable exchange rates (principally the euro versus the United States dollar), offset by a reduction in revenues associated with our indirect PSC and EAC printing operations. The decrease in revenues from 3D printing machines resulted from a slightly lower volume of units sold (seven 3D printing machines sold during the three months ended June 30, 2018, as compared to eight 3D printing machines sold during the three months ended June 30, 2017), and an unfavorable mix of machines sold offset by favorable exchange rates (principally the euro versus the United States dollar).

Revenue for the six months ended June 30, 2018, was $22,750 compared with revenue of $21,668 for the six months ended June 30, 2017, an increase of $1,082, or 5.0%. The increase in revenue resulted from an increase in revenue attributable to our 3D printed and other products, materials and services ~~were~~product group, offset by a decrease in product sales associated with our former specialty machining operation located in our Chesterfield, Michigan facility (approximately $427) following the sale of certain assets associated with this operation in April 2017.

Revenue for the nine months ended September 30, 2017, was $37,555 compared with revenue of $33,157 for the nine months ended September 30, 2016, an increase of $4,398, or 13.3%. The increase in revenue was as a result of increases in revenuerevenues attributable to ~~both of~~ our ~~product lines (3D printing machines and 3D printed and other products, materials and services). The increase in revenues from~~ 3D printing machines resulted primarily from an increase in volume of 3D printing machines sold (25 3D printing machines sold during the nine months ended September 30, 2017, as compared to 21 3D printing machines sold during the nine months ended September 30, 2016) and a favorable mix of 3D printing machines sold (as we sold 14 indirect printers during the quarter ended September 30, 2017, as compared to 11 indirect printers during the quarter ended September 30, 2016, indirect printers generally bearing a higher average selling price than direct printers).product group. The increase in revenues from 3D printed and other products, materials and services principally resulted from an increase in revenues from our direct PSC printing operations as a result of increased customer acceptance of our binder jet technologies and an increase in consumable material and service revenues (maintenance services and replacement components for 3D printing machines) based on an increased global installed base of 3D printing ~~machines.~~ machines along with favorable exchange rates (principally the euro versus the United States dollar). These increases in revenues from 3D printed and other products, materials and services were offset by ~~a decrease~~decreases in product sales associated with our former specialty machining operation located in our Chesterfield, Michigan facility (approximately ~~$729)~~$346) following the sale of certain assets associated with this operation in April 2017 and ~~the absence of the sale of remaining inventories~~a reduction in revenues associated with our ~~former laser micromachining product line (approximately $475) during~~indirect PSC and EAC printing operations. The decrease in revenues from 3D printing machines resulted primarily from an unfavorable mix of machine sold offset by favorable exchange rates (principally the ~~quarter ended June 30, 2016.~~euro versus the United States dollar).

The following table summarizes 3D printing machines sold by type (refer to the “Recent Developments” section above and the “Our Machines and Machine Platforms” section of Part I, Item 1 of our Annual Report on Form 10-K for the year ended December 31, ~~2016,~~2017, for a description of 3D printing machines by type):

Quarter Ended

Nine Months Ended

September 30,

September 30,

2017

2016

2017

2016

3D printing machine units sold:

Exerial

4

—

4

—

S-Max+

1

—

1

1

S-Max

1

4

7

5

S-Print

2

1

2

3

S-15

—

1

—

2

M-Flex

2

1

6

3

Innovent

2

3

5

6

X1-Lab

—

1

—

1

12

11

25

21

Cost of sales for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018 was ~~$11,790~~$9,267, compared with cost of sales of ~~$9,428~~8,773 for the ~~quarter~~three months ended ~~September~~June 30, ~~2016,~~2017, an increase of ~~$2,362,~~$494, or ~~25.1%~~5.6%. The increase in cost of sales was primarily due to an increase in our variable cost of sales associated with our increase in ~~revenues.~~revenues, an increase in consulting and professional fees of approximately $105, a reduction in net gains from the disposal of property and equipment of approximately $256 and unfavorable exchange rates (principally the euro versus the United States dollar). Net gains on the disposal of property and equipment recorded during the three months ended June 30, 2017, primarily related to our sale of certain property and equipment (principally land and building) associated with our consolidation and exit of our North Las Vegas, Nevada PSC. Offsetting these increases was a decrease in cost of sales of approximately $653 in net charges associated with slow-moving, obsolete and lower of cost or net realizable value inventories (principally due to the difference between the $1,460 charge associated with our Exerial 3D printing machine platform inventories recorded during the three months ended June 30, 2017 versus the $561 charge associated with our industrial microwave inventories recorded during the three months ended June 30, 2018).

Gross profit for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018 was ~~$4,097~~$1,590, compared with gross profit of ~~$3,560~~$2,026 for the ~~quarter~~three months ended ~~September~~June 30, ~~2016.~~2017. Gross profit percentage was ~~25.8%~~14.6% for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018, compared with ~~27.4%~~18.8% for the ~~quarter~~three months ended ~~September~~June 30, ~~2016.~~2017. The change in gross profit was the result of the increase in revenues net of the increase in cost of sales as further described above. This includes our recognition of four Exerial 3D printing machines during the quarter ended September 30, 2017 (approximately $2,762), which yielded a break-even result on a contribution margin basis. Excluding these unit sales, we benefitted from overall higher realized pricing on 3D printing machine sales and better leverage of our fixed cost base due to higher sales of 3D printed and other products, materials and services.

Cost of sales for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018 was ~~$29,829~~$18,544, compared with cost of sales of ~~$24,215~~$18,039 for the ~~nine~~six months ended ~~September~~June 30, ~~2016,~~2017, an increase of ~~$5,614,~~$505, or ~~23.2%~~2.8%. The increase in cost of sales was primarily due to an i~~ncrease~~increase in our variable cost of sales associated with our increase in ~~revenues. In addition, we recognized~~revenues, an increase in consulting and professional fees of approximately $297, a reduction in net ~~charge~~gains from the disposal of property and equipment of approximately $273 and unfavorable exchange rates (principally the euro versus the United States dollar). Net gains on the disposal of property and equipment recorded during the three months ended June 30, 2017, primarily related to our sale of certain property and equipment (principally land and building) associated with our consolidation and exit of our North Las Vegas, Nevada PSC. Offsetting these increases was a decrease in cost of sales of approximately $1,064 in net charges associated with slow-moving, obsolete and lower of cost or ~~market inventories of approximately $1,872 during the nine months ended September 30, 2017, compared to a~~ net recovery of approximately $356 during the nine months ended September 30, 2016. The net charge recorded during the nine months ended September 30, 2017, was primarily attributable to certain raw material and componentrealizable value inventories (principally ~~machine frames and other fabricated components) of approximately~~due to the difference between the $1,460 ~~recorded during the quarter ended June 30, 2017,~~charge associated with our Exerial 3D printing machine platform based on decisions made by us during the period related to certain design changes and improvements to the underlying platform (rendering certain elements of the previous design obsolete). The net recoveryinventories recorded during the ~~nine~~three months ended ~~September~~June 30, ~~2016, principally relates~~2017 and the $206 charge associated with certain work in process inventories for which cost was determined to exceed net realizable value during the ~~sale of certain inventories~~three months ended March 31, 2017, versus the $561 charge associated with our ~~former laser micromachining product line (approximately $507)~~industrial microwave inventories recorded during the ~~quarter~~three months ended June 30, ~~2016. Also, during the nine~~2018) and a net decrease in costs associated with exit activities of approximately $489. During six months ended ~~September~~June 30, 2018, we incurred costs of approximately $258 (approximately $17 in other exit costs and $241 in asset impairments) associated with our consolidation of our 3D printing operations from our facility in Desenzano del Garda, Italy into our Gersthofen, Germany facility. During the six months ended June 30, 2017, we incurred costs of approximately $747 (approximately $142 in employee termination costs, $7 in other exit costs and $598 in asset impairments) associated with our consolidation of our 3D printing operations from our facility in North Las Vegas, Nevada into our Troy, Michigan and Houston, Texas facilities and our plan to exit our non-core specialty machining operations in Chesterfield, Michigan. These increases were offset by net gains on disposal of property and equipment recorded during the nine months ended September 30, 2017 (approximately $286), compared to net losses on disposal of property and equipment recorded during the nine months ended September 30, 2016 (approximately $169). Net gains on disposal of property and equipment recorded during the nine months ended September 30, 2017, primarily related to our sale of certain property and equipment (principally land and building) associated with our consolidation and exit of our North Las Vegas, Nevada PSC. Net losses on disposal of property and equipment recorded during the nine months ended September 30, 2016, primarily related to our sale and abandonment of certain property and equipment associated with our consolidation and exit of our Auburn, Washington PSC and the sale of certain machinery and equipment associated with our former specialty machining operations in Chesterfield, Michigan.

Gross profit for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018 was ~~$7,726~~$4,206, compared with gross profit of ~~$8,942~~$3,629 for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2017. Gross profit percentage was ~~20.6%~~18.5% for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018, compared with ~~27.0%~~16.7% for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2017. The ~~decrease~~change in gross profit was the result of the increase in revenues net of the increase in cost of sales as further described above. This includes the aforementioned recognition of Exerial units during the quarter ended September 30, 2017. Excluding these unit sales, we benefitted from overall higher realized pricing on 3D printing machine sales and better leverage of our fixed cost base (net of the items further described above) due to higher sales of 3D printed and other products, materials and services.

Research and development expenses for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018 were ~~$2,871~~$3,235, compared with research and development expenses of ~~$1,898~~$2,349 for the ~~quarter~~three months ended ~~September~~June 30, ~~2016,~~2017, an increase of ~~$973,~~$886, or ~~51.3%~~37.7%. The increase in research and development expenses was primarily due to an increase in employee-related costs (salaries, benefits and equity-based compensation) of approximately $374 (including approximately $71 in employee termination costs associated with our global cost realignment enacted in June 2018), an increase in consulting and professional fees associated with certain machine development and other organizational development activities of approximately $305 and unfavorable exchange rates (principally the euro versus the United States dollar).

Research and development expenses for the six months ended June 30, 2018, were $6,030 compared with research and development expenses of $4,348 for the six months ended June 30, 2017, an increase of $1,682, or 38.7%. The increase in research and development expenses was primarily due to increases in employee-related costs (salaries, benefits and equity-based compensation) of approximately ~~$295 and~~$718 (including approximately $71 in employee termination costs associated with our global cost realignment enacted in June 2018), consulting and professional fees associated with certain machine development and other organizational development activities of approximately ~~$521.~~

Research and development expenses for the nine months ended September 30, 2017, were $7,219 compared with research and development expenses of $5,737 for the nine months ended September 30, 2016, an increase of $1,482, or 25.8%. The increase in research and development expenses was primarily due to increases in employee-related costs (salaries, benefits and equity-based compensation) of approximately $362, consulting and professional fees associated with certain machine development and other organizational development activities of approximately $852$661 and material costs of approximately ~~$193~~$121 (primarily associated with our development of large format, fine powder direct printing capabilities).

We expect to increase our investment in research and development ~~activities).~~by approximately $4,000 during 2018 (as compared to 2017) in an effort to accelerate the development of our large format, fine powder direct printing capabilities and our material development activities for direct and indirect printing, among other initiatives.

Selling, general and administrative expenses for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018 were ~~$6,062~~$6,353, compared with selling, general and administrative expenses of ~~$5,234~~$6,013 for the ~~quarter~~three months ended ~~September~~June 30, ~~2016,~~2017, an increase of ~~$828,~~$340, or ~~15.8%~~5.7%. The increase in selling, general and administrative expenses was principally due to ~~increases~~an increase in employee-related costs ~~(principally salaries, benefits~~(salaries and ~~equity-based compensation)~~benefits) of approximately ~~$933~~$1,037 (including approximately $708 in employee termination costs associated with ~~our investment~~the change in our ~~commercial leadership team~~Chief Executive Officer and ~~executive severance costs,~~our global cost realignment, both enacted in June 2018) and unfavorable exchange rates (principally the euro versus the United States dollar). These increases were offset by decreases associated with equity-based compensation of approximately $322 (primarily due to pre-vesting forfeitures associated with the change in our Chief Executive Officer in June 2018), a decrease in consulting and professional fees of approximately $324 ~~(principally executive consulting, legal~~ and ~~other administrative arrangements). These increases were offset by decreases in trade show expenses~~net recoveries for bad debts of approximately ~~$148 and~~$48 during the three months ended June 30, 2018 versus a ~~decrease in our~~net provision for bad debts ~~from customers (net recoveries~~ of approximately ~~$183~~$9 during the ~~quarter~~three months ended ~~September~~June 30, ~~2017, compared to a net provision of approximately $15 during the quarter ended September 30, 2016).~~2017.

Selling, general and administrative expenses for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018 were ~~$18,338~~$12,555, compared with selling, general and administrative expenses of ~~$15,222~~$12,276 for the ~~nine~~six months ended ~~September~~June 30, ~~2016,~~2017, an increase of ~~$3,116,~~$279, or ~~20.5%~~2.3%. The increase in selling, general and administrative expenses was principally due to ~~increases~~an increase in employee-related costs (salaries ~~benefits~~ and ~~equity-based compensation)~~benefits) of approximately ~~$1,522~~$1,402 (including approximately $708 in employee termination costs associated with ~~our investment~~the change in our ~~commercial leadership team~~Chief Executive Officer and ~~executive severance costs,~~our global cost realignment, both enacted in June 2018) and unfavorable exchange rates (principally the euro versus the United States dollar). These increases were offset by decreases associated with equity-based compensation of approximately $569 (primarily due to pre-vesting forfeitures associated with the change in our Chief Executive Officer in June 2018), consulting and professional fees of approximately ~~$819 (principally executive consulting, legal and other administrative arrangements), lower~~$218, net recoveries for bad debts ~~from customers (net recoveries~~ of approximately ~~$51~~$37 during the ~~nine~~six months ended ~~September~~June 30, 2018 versus a net provision for bad debts of approximately $132 during the six months ended June 30, 2017, ~~compared to net recoveries~~and the absence of ~~approximately $256 during the nine months ended September 30,~~

~~2016),~~ an impairment of intangible assets of approximately $269 during the ~~quarter~~six months ended ~~March 31,~~June 30, 2017, in connection with our plan to exit our non-core specialty machining operations at our Chesterfield, Michigan ~~facility, and an increase in selling costs of approximately $175 (promotional expenses, trade show activities and sales commissions on 3D printing machine sales).~~facility.

Interest expense for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018 was ~~$24~~$73, compared with interest expense of ~~$22~~$23 for the ~~quarter~~three months ended ~~September~~June 30, ~~2016,~~2017, an increase of ~~$2,~~$50, or ~~9.1%. Amounts for both periods consisted principally of periodic interest expense associated with long-term debt and capital lease obligations.~~

~~Interest expense for the nine months ended September 30, 2017, was $69 compared with interest expense of $276 for the nine months ended September 30, 2016, a decrease of $207, or 75.0%~~217.4%. The ~~decrease~~increase in interest expense was principally due to ~~the effect of the termination of the~~interest incurred in connection with our revolving credit facility with a related party entered into on March 12, 2018 (approximately $49 during the ~~quarter~~three months ended June 30, 2018).

Interest expense for the six months ended June 30, 2018 was $106, compared with interest expense of $45 for the six months ended June 30, 2017, an increase of $61, or 135.6%. The increase in interest expense was principally due to interest incurred in connection with our revolving credit facility with a related party entered into on March ~~31, 2016, which resulted in an acceleration of amortization of debt issuance costs of approximately $204.~~12, 2018 (approximately $59 during the six months ended June 30, 2018).

Other (income) expense – net for the ~~quarter~~three months ended ~~September~~June 30, ~~2017,~~2018 was ($~~11)~~52), compared with other (income) expense – net of ~~($8)~~$35 for the ~~quarter~~three months ended ~~September~~June 30, ~~2016.~~2017. Amounts for both periods consisted principally of interest income on cash and cash equivalents balances ~~offset by~~and net foreign exchange (gains) losses on commercial transactions and certain intercompany transactions between subsidiaries either settled or planned for settlement in the foreseeable future.

Other (income) expense – net for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018 was ~~$134~~($98), compared with other (income) expense – net of ~~($306)~~$145 for the ~~nine~~six months ended ~~September~~June 30, ~~2016. The change~~2017. Amounts for both periods consisted principally of ~~$440 was principally due to~~interest income on cash and cash equivalents balances and net ~~currency~~foreign exchange (gains) losses on commercial transactions and certain intercompany transactions between subsidiaries either settled or planned for settlement in the foreseeable ~~future, for the nine months ended September 30, 2017, as compared to net currency exchange gains during the nine months ended September 30, 2016.~~future.

The provision for income taxes for the ~~quarters~~three months ended ~~September~~June 30, 2018 and 2017 was $18 and ~~2016, was $14 and $25,~~$9, respectively. The effective tax rate for the ~~quarters~~three months ended ~~September~~June 30, 2018 and 2017 ~~and 2016,~~ was ~~0.3%~~0.2% (provision on a loss) and ~~0.7%~~0.1% (provision on a loss), respectively. The provision for income taxes for the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, was $35 and ~~2016, was $23 and $43,~~$9, respectively. The effective tax rate for the ~~nine~~six months ended ~~September~~June 30, 2018 and 2017, ~~and 2016,~~ was ~~0.1%~~0.2% (provision on a loss) and ~~0.4%~~0.1% (provision on a loss), respectively. ~~For each of the quarters and nine months ended September 30, 2017 and 2016, the~~ The

effective tax rate differs from the ~~U.S.~~United States federal statutory rate of 21.0% (2018) and 34.0% (2017) for each of the periods presented primarily due to net changes in valuation allowances for the ~~period.~~periods.

We have completed a discrete period computation of our provision for income taxes for each of the periods presented. The discrete period computation was required as a result of jurisdictions with losses before income taxes for which no tax benefit can be recognized and an inability to generate reliable estimates for results in certain jurisdictions as a result of inconsistencies in generating net operating profits (losses) in those jurisdictions.

We have provided a valuation allowance for our net deferred tax assets as a result of our inability to generate consistent net operating profits in jurisdictions in which we operate. As such, any benefit from deferred taxes in any of the periods presented in our condensed consolidated financial statements has been fully offset by changes in the valuation allowance for net deferred tax assets. We continue to assess our future taxable income by jurisdiction based on our recent historical operating results, the expected timing of reversal of temporary differences, various tax planning strategies that we may be able to enact in future periods, the impact of potential operating changes on our business and our forecast results from operations in future periods based on available information at the end of each reporting period. To the extent that we are able to reach the conclusion that net deferred tax assets are realizable based on any combination of the above factors in a single, or multiple, taxing jurisdictions, a reversal of the related portion of our existing valuation allowances may occur.

Our results of operations and financial condition are presented based on historical cost. While it is difficult to accurately measure the impact of inflation due to the imprecise nature of the estimates required, we believe the effects of inflation, if any, on our results of operations and financial condition are not significant.

We have incurred a net loss in each of our annual periods since our inception. In addition, we incurred a net loss of approximately ~~$4,863~~$8,037 and ~~$18,057~~$14,422 for the ~~quarter~~three and ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018, respectively. ~~In connection with the completion of our initial public offering and subsequent secondary offerings (including our ATM), we~~We have received cumulative unrestricted net proceeds from the sale of our common stock (through our initial public offering and subsequent secondary offerings) of approximately $168,361 to fund our operations. At ~~September~~June 30, ~~2017,~~2018, we had approximately ~~$17,706~~$11,584 in unrestricted cash and cash equivalents.

In March 2018 we entered into a three-year, $15,000 revolving credit facility with a related party (further described below).

In June 2018 we announced our plans for a global cost realignment which focuses on a reduction of our production overhead costs and operating expenses in an effort to achieve net income and positive cash flows in 2019. As part of our plans, we have already executed on certain employee terminations and reductions in consulting expenditures. We plan to continue this process through the end of 2018 with particular focus on operational and working capital efficiencies. In connection with our plans, we expect to achieve cost savings of approximately $2,000 to $3,000 during the second half of 2018 (as compared to the first half of 2018), with an overall goal of cost savings of approximately $10,000 in 2019 (as compared to full year 2018).

We believe that our existing capital resources will be sufficient to support our operating plan. If we anticipate that our actual results will differ from our operating plan, we believe we have sufficient capabilities to enact cost savings measures to preserve

~~capital.~~ capital (in addition to the cost savings measures associated with our global cost realignment program further described above). Further, we may seek to raise additional capital to support our growth through additional debt, equity or other alternatives (including asset sales) or a combination thereof.

On March 12, 2018, ExOne and its ExOne Americas LLC and ExOne GmbH subsidiaries, as guarantors (collectively, the “Loan Parties”), entered into a Credit Agreement and related ancillary agreements with LBM Holdings, LLC (“LBM”), a company controlled by S. Kent Rockwell, who was our Executive Chairman (a related party) at such date, relating to a $15,000 revolving credit facility (the “LBM Credit Agreement”) to provide additional funding for working capital and general corporate purposes. The LBM Credit Agreement provides for a term of three years (through March 12, 2021) and bears interest at a rate of one month LIBOR plus an applicable margin of 500 basis points (approximately 6.7% and 7.1% at inception and June 30, 2018, respectively). The LBM Credit Agreement requires a commitment fee of 75 basis points, or 0.75%, on the unused portion of the facility, payable monthly in arrears. In addition, an up-front commitment fee of 125 basis points, or 1.25% (approximately $188), was required at closing. Borrowings under the LBM Credit Agreement are required to be in minimum increments of $1,000. ExOne may terminate or reduce the credit commitment at any time during the term of the LBM Credit Agreement without penalty. ExOne may also make prepayments against outstanding borrowings under the LBM Credit Agreement at any time without penalty. Borrowings under the LBM Credit Agreement have been collateralized by the accounts receivable, inventories and machinery and equipment of the Loan Parties. At inception and June 30, 2018 the total estimated value of collateral was in significant excess of the maximum borrowing capacity under the LBM Credit Agreement.

LBM was determined to be a related party based on common control by S. Kent Rockwell, who was our Executive Chairman at the time we entered into the LBM Credit Agreement and effective June 20, 2018, became our Chairman and Chief Executive Officer. Accordingly, we do not consider the LBM Credit Agreement indicative of a fair market value lending. Prior to execution, the LBM Credit Agreement was subject to review and approval by a sub-committee of independent members of our Board of Directors (which included each of the members of the Audit Committee of the Board of Directors). At the time of execution of the LBM Credit Agreement, the $15,000 in available loan proceeds were deposited into an escrow account with an unrelated, third party financial institution pursuant to a separate Escrow Agreement by and among the parties. Loan proceeds held in escrow are available to us upon our submission to the escrow agent of a loan request. Such proceeds will not be available to LBM until payment in-full of the obligations under the LBM Credit Agreement and termination of the LBM Credit Agreement. Payments of principal and other obligations will be made to the escrow agent, while interest payments will be made directly to LBM. Provided there exists no potential default or event of default, the LBM Credit Agreement and Escrow Agreement prohibit any acceleration of repayment of any amount outstanding under the LBM Credit Agreement and prohibit termination of the LBM Credit Agreement or withdrawal from escrow of any unused portion of the LBM Credit Agreement.

There were no borrowings by us under the LBM Credit Agreement from March 12, 2018 through June 30, 2018.

We incurred approximately $264 in debt issuance costs associated with the LBM Credit Agreement (including the aforementioned up front commitment fee paid at closing to LBM). During the three and six months ended June 30, 2018, we recorded interest expense relating to the LBM Credit Agreement of approximately $49 and $59, respectively. Included in interest expense for the three and six months ended June 30, 2018 was approximately $21 and $25, respectively, associated with amortization of debt issuance costs (resulting in approximately $239 in remaining debt issuance costs at June 30, 2018, of which approximately $88 was included in prepaid expenses and other current assets and approximately $151 was included in other noncurrent assets in the accompanying condensed consolidated balance sheet). Included in interest expense for the three and six months ended June 30, 2018 was approximately $28 and $34, respectively, associated with the commitment fee on the unused portion of the revolving credit facility, of which at June 30, 2018 approximately $9 was included in accounts payable in the accompanying condensed consolidated balance sheet. We settled all amounts payable to LBM at June 30, 2018 in July 2018.

The following table summarizes the significant components of cash flows for each of the ~~nine~~six month periods ended ~~September~~June 30, 2018 and 2017, and our cash, cash equivalents, and restricted cash balances at ~~September~~June 30, ~~2017~~2018 and December 31, ~~2016:~~2017:

							Six Months Ended
							June 30,
	2017			2016			2018			2017
Net cash used for operating activities	$	(12,895	)	$	(1,908	)	$	(7,873	)	$	(6,924	)
Net cash provided by (used for) investing activities		2,828			(638	)
Net cash (used for) provided by financing activities		(166	)		12,879
Net cash (used for) provided by investing activities								(794	)		3,285
Net cash used for financing activities								(267	)		(113	)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash		882			138			(197	)		760
Net change in cash, cash equivalents, and restricted cash	$	(9,351	)	$	10,471		$	(9,131	)	$	(2,992	)


	September 30, 2017			December 31, 2016			June 30, 2018			December 31, 2017
Cash and cash equivalents	$	17,706		$	27,825		$	11,584		$	21,848
Restricted cash		1,098			330			1,463			330
Cash, cash equivalents, and restricted cash shown in the condensed statement of consolidated cash flows	$	18,804		$	28,155
Cash, cash equivalents, and restricted cash							$	13,047		$	22,178

Net cash used for operating activities for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018 was ~~$12,895~~$7,873, compared with net cash used for operating activities of ~~$1,908~~$6,924 for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2017. The ~~change~~net increase in outflows of ~~$10,987~~$949 was due to an increase in our net loss ~~combined with a decrease~~(net of noncash items) offset by an increase in net cash inflows from changes in assets and liabilities, ~~including a decrease~~mostly due to an increase in net cash inflows from customers (principally due to ~~the implementation~~timing of ~~more favorable liquidity terms with customers during the nine months ended September 30, 2016) and~~cash collections on 3D printing machine sales) offset by an

increase in net cash outflows ~~related to inventories (based on~~principally associated with inventory production of our ~~operating plans for delivery of~~ 3D printing machines ~~to customers). These changes were partially offset by a reduction in cash outflows to vendors (based on the timing of payment)~~(consistent with our operating plans).

Net cash used for investing activities for the six months ended June 30, 2018 was $794, compared with net cash provided by investing activities of $3,285 for the six months ended June 30, 2017.

Activity for both periods included cash outflows for capital expenditures (consistent with our operating plans), offset by proceeds from the sale of property and equipment. Net cash provided by investing activities for the ~~nine~~six months ended ~~September 30, 2017, was $2,828 compared with net cash used for investing activities of $638 for the nine months ended September 30, 2016.~~

~~Net cash provided by investing activities for the nine months ended September~~June 30, 2017, included cash inflows of approximately ~~$3,702~~$3,677 in proceeds from the sale of property and equipment, mostly attributable to our sale of assets associated with our non-core specialty machining operation in Chesterfield, Michigan and our PSC in North Las Vegas, Nevada during the ~~quarter~~three months ended June 30, 2017. ~~Remaining activity for both periods included cash outflows for capital expenditures consistent with our operating plans.~~

We expect our remaining ~~2017~~2018 capital expenditures to be limited to spending associated with sustaining our existing operations and strategic asset acquisition and deployment (additional estimated spending of less than $1,000).

Net cash used for financing activities for the ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018 was ~~$166~~$267, compared with net cash ~~provided by~~used for financing activities of ~~$12,879~~$113 for the ~~nine~~six months ended ~~September~~June 30, ~~2016.~~2017.

Uses of cash for ~~the nine months ended September 30, 2017,~~both periods included principal payments on outstanding debt and capital leases.

Sources of cash for the nine months ended September 30, 2016, included net proceeds from the issuance of common stock of approximately $12,447 in connection with our registered direct offering to a related party and approximately $595 in connection with our ATM. Uses of cash for the ~~nine~~six months ended ~~September~~June 30, ~~2016,~~2018 also included ~~principal payments on outstanding~~approximately $188 in debt ~~and capital leases.~~issuance costs associated with our revolving credit facility with a related party (further described above).

In the normal course of our operations, our ExOne GmbH subsidiary issues financial guarantees and letters of credit to third parties in connection with certain commercial transactions requiring security. At ~~September~~June 30, 2018, total outstanding financial guarantees and letters of credit issued by us were approximately $1,056 (€904) with expiration dates ranging from July 2018 through June 2022. At December 31, 2017, total outstanding financial guarantees and letters of credit issued by us were approximately ~~$1,633~~$1,224 (€~~1,382).~~ Included in the total outstanding financial guarantees and letters of credit issued by us are approximately $1,352 (€1,144) with expiration dates ranging from October 2017 through July 2018 and approximately $281 (€238) which have no expiration date. ~~At December 31, 2016, total outstanding financial guarantees and letters of credit issued by us were approximately $400 (€380)~~1,021). For further discussion related to financial guarantees

and letters of credit issued by us, refer to Note 10 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Refer to Note 1 to the condensed consolidated financial statements in Part I, Item 1 of this Quarterly Report on Form 10-Q.

Refer to Note 1 ofto the consolidated financial statements in Part I,II, Item 8 of our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017.

We are exposed to market risk from fluctuations in foreign currency exchange rates which may adversely affect our results of operations and financial condition. We seek to minimize these risks through regular operating and financing activities and, when we consider it to be appropriate, through the use of derivative financial instruments. We do not purchase, hold or sell derivative financial instruments for trading or speculative purposes.

The local currency is the functional currency for significant operations outside of the United States. The determination of the functional currency of an operation is made based on the appropriate economic and management indicators.

Foreign currency assets and liabilities are translated into their United States dollar equivalents based on period end spot exchange rates, and are included in stockholders’ equity as a component of other comprehensive income (loss). Revenues and expenses are translated at average exchange rates. Transaction gains and losses that arise from exchange rate fluctuations are charged to operations as incurred, except for gains and losses associated with certain long-term intercompany transactions for which settlement is not planned or anticipated in the foreseeable future, which are included in accumulated other comprehensive loss in the condensed consolidated balance sheet.

We transact business globally and are subject to risks associated with fluctuating foreign exchange rates. Approximately ~~68.2%~~53.1% and ~~59.3%~~45.1% of our consolidated revenue was derived from transactions outside the United States for the ~~quarters~~three months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. Approximately ~~61.2%~~56.9% and ~~54.0%~~56.1% of our consolidated revenue was derived from transactions outside the United States for the ~~nine~~six months ended ~~September~~June 30, ~~2017~~2018 and ~~2016,~~2017, respectively. This revenue is generated primarily from wholly-owned

subsidiaries operating in their respective countries and surrounding geographic areas. This revenue is primarily denominated in each subsidiary’s local functional currency, including the euro and Japanese yen. A hypothetical change in foreign exchange rates of +/- 10.0% for the ~~quarter~~three and ~~nine~~six months ended ~~September~~June 30, ~~2017,~~2018, would result in an increase (decrease) in revenue of approximately ~~$1,100~~$600 and ~~$2,300,~~$1,300, respectively. These subsidiaries incur most of their expenses (other than intercompany expenses) in their local functional currencies.

At ~~September~~June 30, ~~2017,~~2018, we held approximately ~~$18,804~~$13,047 in cash, cash equivalents, and restricted cash, of which approximately ~~$15,366~~$6,681 was held by certain of our subsidiaries in United States dollars.

~~Our management,~~ As of June 30, 2018, we carried out an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and ~~our~~ Chief Financial Officer, ~~evaluated~~of the effectiveness of the design and operation of our disclosure controls and procedures ~~as of September 30, 2017. The term “disclosure controls and procedures,” as~~(as defined in Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) pursuant to Rules 13a-15 and 15d-15 under the Exchange ~~Act, means~~Act. These controls and ~~other~~ procedures ~~of a company that are~~were designed to ~~ensure~~provide reasonable assurance that the information required to be disclosed ~~by a company~~ in the reports that ~~it files~~we file or ~~submits~~submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and ~~forms. Disclosure controls~~forms and ~~procedures include, without limitation, controls and procedures designed to ensure~~ that such information ~~required to be disclosed by a company in the reports that it files or submits under the Exchange Act~~ is accumulated and communicated to ~~the company’s~~our management, including ~~its principal executive~~our Chief Executive Officer and ~~principal financial officers, as appropriate~~Chief Financial Officer, in a manner to allow timely decisions regarding required disclosure. Management recognizes 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 in evaluating the cost benefit relationship of possible controls and procedures.disclosures. Based on this evaluation, management has concluded ~~as of September 30, 2017,~~ that our disclosure controls and procedures were ~~not~~ effective ~~at the~~as of June 30, 2018 to provide reasonable assurance ~~level due~~that the information required to ~~a material weakness in our internal control over financial reporting as discussed~~be disclosed in the ~~Company’s Annual Report on Form 10-K filed on March 16, 2017.~~reports we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and that such information is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, in a manner to allow timely decisions regarding required disclosures.

As a result of the material weakness described in our Annual Report on Form 10-K, we performed additional analysis and other post-closing procedures to ensure our condensed consolidated financial statements were prepared in accordance with GAAP. Accordingly, management believes that the financial statements and related notes thereto included in this report fairly present, in all material respects, our financial condition, results of operations and cash flows for the periods presented.

~~With oversight from our executive management and Audit Committee of our Board of Directors, we continue to address the identified material weakness~~ There were no changes in our ~~information technology system platform specific~~internal controls over financial reporting during the six months ended June 30, 2018, that have materially affected, or are reasonably likely to our ExOne GmbH subsidiary, in particular, how this information technology system platform impacts our accounting for inventories specific to ExOne GmbH. Our approach includes the identification and remediation of known errors in the original implementation of, and subsequent changes to, this information technology system platform in an effort to reduce certain manual processes and controls necessary to ensure accurate and timely reporting of operating results associated with this subsidiary. We expect this process to be completed by December 31, 2017.

~~We can provide no assurance at this time that management will be able to report that~~materially affect, our internal control over financial reporting will be effective as of December 31, 2017. As an EGC, we are exempt from the requirement to obtain an attestation report from our independent registered public accounting firm on the assessment of our internal controls pursuant to the Sarbanes-Oxley Act of 2002 until such time that we no longer qualify as an EGC.reporting.

On July 1, 2017, the Company (through its ExOne GmbH subsidiary) entered into a Settlement Agreement with Kocel Foundry Limited (also known as Kocel CSR Casting Company, Limited) and Kocel Group (Hong Kong) Limited (collectively, “Kocel”) relating to settlement of the arbitration case (no. 100019-2017) administered by the Swiss Chambers’ Arbitration Institution Notice of Arbitration, as filed by the Company on January 25, 2017. Among other things, the Settlement Agreement provided for a cash payment from ExOne GmbH to Kocel of approximately $811,335 and a settlement and release of claims related to a sales agreement between the parties for certain 3D printing machines and related equipment.

We are subject to various litigation, claims, and proceedings which have been or may be instituted or asserted from time to time in the ordinary course of business. ~~Other than the matter further described above, management~~Management does not believe that the outcome of any pending or threatened matters will have a material adverse effect, individually or in the aggregate, on our financial position, results of operations or cash flows.

There have been no material changes from the risk factors as previously disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2016.~~2017.

The Exhibits listed on the accompanying Index to Exhibits are filed as part of this Quarterly Report on Form 10-Q.

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

Pursuant to the requirements of the Exchange Act, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

Large accelerated filer		☐		Accelerated filer	☒	☒
Non-accelerated filer	☐	(Do not check if a smaller reporting company)	Smaller reporting company	☐

~~Non-accelerated filer~~		☐ ~~(Do not check if a small reporting company)~~		~~Small reporting company~~		☐

Emerging growth company		☒

	February 10, 2017	August 14, 2017
Weighted average fair value per stock option	$5.46 - $5.75	$3.40 - $4.38
Volatility	62.89% - 63.75%	61.68% - 67.92%
Average risk-free interest rate	1.89% - 1.94%	1.40% - 1.82%
Dividend yield	0.00%	0.00%
Expected term (years)	5.0 - 5.5	2.5 - 5.5

		February 10, 2017
Weighted average fair value per stock option		$5.46 - $5.75
Volatility		62.89% - 63.75%
Average risk-free interest rate		1.89% - 1.94%
Dividend yield		0.00%
Expected term (years)		5.0 - 5.5

	August 12, 2016		August 19, 2016
Weighted average fair value per stock option	$8.07		$7.97
Volatility		66.43%		66.24%
Average risk-free interest rate		1.18%		1.20%
Dividend yield		0.00%		0.00%
Expected term (years)		6.0		5.5

Level 1		Observable inputs such as quoted prices in active markets for identical investments that the Company has the ability to access.

Level 2		Inputs include:

		Quoted prices for similar assets or liabilities in active markets;

		Quoted prices for identical or similar assets or liabilities in inactive markets;

		Inputs, other than quoted prices in active markets, that are observable either directly or indirectly; and

		Inputs that are derived principally from, or corroborated by, observable market data by correlation or other means.

Level 3		Inputs that are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability.

Exhibit Number	Description	Method of Filing


~~10.1~~	~~Executive At-Will Employment Agreement dated August 4, 2017, by and between The ExOne Company and JoEllen Lyons Dillon.~~	~~Filed herewith.~~
~~10.2~~	~~The ExOne Company Change of Control Severance Plan dated August 8, 2017.~~	~~Filed herewith.~~
31.1	Rule 13(a)-14(a) Certification of Principal Executive Officer.	Filed herewith.

31.2	Rule 13(a)-14(a) Certification of Principal Financial Officer.	Filed herewith.

32	Section 1350 Certification of Principal Executive Officer and Principal Financial Officer.	Filed herewith.

101.INS	XBRL Instance Document.	Filed herewith.

101.SCH	XBRL Taxonomy Extension Schema Document.	Filed herewith.

101.CAL	XBRL Taxonomy Extension Calculation Linkbase Document.	Filed herewith.

101.DEF	XBRL Taxonomy Extension Definition Linkbase Document.	Filed herewith.

101.LAB	XBRL Taxonomy Extension Label Linkbase Document.	Filed herewith.

101.PRE	XBRL Taxonomy Extension Presentation Linkbase Document.	Filed herewith.

The ExOne Company

By:		/s/ ~~James L. McCarley~~S. Kent Rockwell
		~~James L. McCarley~~S. Kent Rockwell
		Chief Executive Officer
		(Principal Executive Officer)

Date:		~~November~~August 9, ~~2017~~2018

By:		/s/ ~~Brian W. Smith~~Douglas D. Zemba
		~~Brian W. Smith~~Douglas D. Zemba
		Chief Financial Officer
		(Principal Financial Officer and Principal Accounting Officer)

Date:		~~November~~August 9, ~~2017~~2018

March 16,
2018

Weighted average fair value per stock option

Volatility

Average risk-free interest rate

Dividend yield

Expected term (years)