Reed's, Inc. Revises Corporate Financing Plans
Released: 03/17/09 09:00 AM EDT
Strong Sales Supporting Internal Growth Initiatives, Improving Cash Flows and Gross Margins

LOS ANGELES, CA -- (Marketwire) -- 03/17/09 -- Reed's, Inc. (NASDAQ: REED), maker of the top-selling sodas in natural food stores nationwide, has provided an update to its corporate financing plans. The company cited sales, reduced costs of goods, new mainstream accounts and increased efficiency in its bottling operations as catalysts.

"In January the company filed an S-1 Registration Statement for $10 million with the intention of completing a rights offering at $2.25 per share," stated Christopher Reed, Founder and CEO of Reed's, Inc. "Due to reductions in operating expenses and improvements in gross margins that have us on track for break-even in 2009, we are pursuing more traditional asset based lenders."

Mr. Reed added, "Our cash flow is much better than we anticipated, due in large part to the aggressive cost-cutting and efficiencies that we have implemented across the organization; therefore we are negotiating with companies that can lend more aggressively on our assets. We believe that these non-dilutive funding mechanisms will better serve the company and its stakeholders at this time. We currently don't need to raise the $10 million originally filed for in the S-1. If we do use it, we will significantly lower the amount."

Mr. Reed continued, "When we went public, the capital markets were at a premium to the private markets. Now our current valuation is about 50% of sales, where my private beverage company counterparts are still, as late as December 2008, receiving valuations in the 200-300% of sales range from investors. If we could receive private company valuations as a public company, we may pursue strategic investors to come on board."

About Reed's, Inc.

Reed's, Inc. makes the top selling sodas in natural food markets nationwide and is currently selling in 10,500 supermarkets in natural foods and mainstream. Its six award-winning non-alcoholic Ginger Brews are unique in the beverage industry, being brewed, not manufactured and using fresh ginger, spices and fruits in a brewing process that predates commercial soft drinks. In addition, the Company owns the top selling root beer line in natural foods, the Virgil's Root Beer product line, and the top selling cola line in natural foods, the China Cola product line. Other product lines include: Reed's Ginger Candies and Reed's Ginger Ice Creams.

Reed's products are sold through specialty gourmet and natural food stores, mainstream supermarket chains, retail stores and restaurants nationwide, and in Canada. For more information about Reed's, please visit the company's website at: or call 800-99-REEDS.

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Some portions of this press release, particularly those describing Reed's goals and strategies, contain "forward-looking statements." These forward-looking statements can generally be identified as such because the context of the statement will include words, such as "expects," "should," "believes," "anticipates" or words of similar import. Similarly, statements that describe future plans, objectives or goals are also forward-looking statements. While Reed's is working to achieve those goals and strategies, actual results could differ materially from those projected in the forward-looking statements as a result of a number of risks and uncertainties. These risks and uncertainties include difficulty in marketing its products and services, maintaining and protecting brand recognition, the need for significant capital, dependence on third party distributors, dependence on third party brewers, increasing costs of fuel and freight, protection of intellectual property, competition and other factors, any of which could have an adverse effect on the business plans of Reed's, its reputation in the industry or its expected financial return from operations and results of operations. In light of significant risks and uncertainties inherent in forward-looking statements included herein, the inclusion of such statements should not be regarded as a representation by Reed's that they will achieve such forward-looking statements. For further details and a discussion of these and other risks and uncertainties, please see our most recent reports on Form 10-KSB and Form 10-Q, as filed with the Securities and Exchange Commission, as they may be amended from time to time. Reed's undertakes no obligation to publicly update any forward-looking statement, whether as a result of new information, future events, or otherwise.

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