DEF 14A 1 formdef14a.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

SCHEDULE 14A

(RULE 14a-101)

INFORMATION REQUIRED IN PROXY STATEMENT

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934

Filed by Registrant ☒

Filed by a Party other than the Registrant ☐

Check the appropriate box:

	☐	Preliminary Proxy Statement
	☐	Confidential, for use of the Commission only (only as permitted by Rule 14a-6(e)(2))
	☒	Definitive Proxy Statement
	☐	Definitive Additional Materials
	☐	Soliciting Material Pursuant to Section 240.14a-12

REED’s, INC.

(Name of Registrant as Specified in its Charter)

Payment of Filing Fee (Check the appropriate box):

	☒	No fee required.
	☐	Fee paid previously with preliminary materials.
	☐	Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

FORWARD LOOKING STATEMENTS

This statement contains forward-looking statements. These statements include projections, predictions, expectations or statements as to beliefs or future events or results or refer to other matters that are not historical facts. Forward-looking statements are subject to known and unknown risks, uncertainties and other factors that could cause the actual results to differ materially from those contemplated by these statements. The forward-looking statements contained herein are based on various factors and were derived using numerous assumptions. In some cases, you can identify these forward-looking statements by the words “expect,” “anticipate,” “intend,” “plan,” “believe,” “estimate,” “potential,” “predict,” “project,” “should,” “would” or the negative of those words and other comparable words. You should be aware that those statements reflect only the predictions of Reed’s, Inc.’s management. If known or unknown risks or uncertainties should materialize, or if underlying assumptions should prove inaccurate, actual results could differ materially from past results and those anticipated, estimated or projected. You should bear this in mind not to place undue reliance on these forward-looking statements. Although we believe that the expectations reflected in the forward-looking statements contained in this statement are reasonable, we cannot guarantee future results, levels of activity, performance or achievements.

201 Merritt 7 Corporate Park, Norwalk, Connecticut 06851

Dear Fellow Stockholders:

During the last three years, we have been focused on our strategy to consistently grow revenue, increase gross margins, and manage operating expenses. We have taken decisive measures to navigate the economy and continue to drive towards our end goal of achieving cash flow breakeven.

	●	In 2020, we made significant progress as net revenue grew 23%, gross margin increased from 23% to 31%, delivery and handling costs on a per case basis declined from $2.83 to $2.76, and SG&A costs, as a percentage of net revenue, declined from 49% to 35%.
	●	In 2021, the economic effects of the COVID-19 pandemic and resulting supply chain challenges impacted the entire beverage industry. Although we continued to grow the top line by nearly 20%, gross margins declined, and delivery and handling costs jumped from $2.76 per case to $3.95 per case.
	●	During 2022, we continued to face supply chain bottlenecks and soaring inflation. We increased pricing to help offset inflation in the first half of 2022. Thus far, we have managed to drive revenue growth without increasing our promotional spending levels, and we have lowered SG&A as a percentage of net revenue, from 40% to 32%.
	●	More recently, input costs appear to have peaked and, in certain areas, declined, and transportation costs have been receding. We have responded with new measures intended to increase gross margin back above the 30% level and reduce delivery and handling expenses by an estimated $4M-$5M annually, or over $1.00 per case. Accordingly, we believe we are back on track to reach cash flow breakeven during the latter half of 2023.

Our brands remain vibrant as our Reed’s portfolio continues to grow at retail led by Reed’s Ginger Ale, Reed’s Ginger Beer in cans and our new RTD alcohol lineup. We recently took back the distribution rights of our Reed’s RTD Classic Mule and subsequently launched a new Stormy Mule. We also launched Reed’s Hard Ginger Ale. Our Virgil’s Zero Sugar, which was initially launched in the Natural and Enhanced channel, is showing strong acceptance and has experienced triple digit growth YTD in 2022.

In May 2022, we entered into a 10% Secured Convertible Note transaction with institutional investors that are affiliates of Whitebox Advisors, LLC pursuant to which we issued $11.25 million of 10% notes (the “10% Note Transaction”). We also granted the holders an option to purchase up to an additional $12 million aggregate principal amount of 10% notes, having identical terms.

The 10% notes contain certain covenants, including, among others, a deadline of October 5, 2022 by which to hold this 2022 Annual Meeting of Stockholders in order to obtain approval for (1) the potential issuance of more than 19.9% of our outstanding common stock pursuant to the Note Transaction, for purposes of the rules of The Nasdaq Stock Market LLC and (2) an amendment to Reed’s certificate of incorporation to ensure Reed’s has sufficient shares of common stock available for issuance under the Note Transaction (and for other purposes as determined by management). As a reminder, note holders may not hold more that 9.9% at any given time.

You have important decisions to make at the upcoming annual meeting of stockholders on October 5, 2022.

The Board of Directors strongly recommends that stockholders:

	●	Approve, for purposes of the rules of The Nasdaq Stock Market LLC, the potential issuance of more than 19.9% of our outstanding common stock upon conversion of our 10% Secured Convertible Notes.
	●	Approve an amendment to the Reed’s, Inc. certificate of incorporation to effect a reverse stock split (without reducing the authorized number of shares of common stock).

Whether or not you plan to attend the special meeting, please vote as promptly as possible. You can vote by mail, Internet, or telephone according to the instructions on each Internet Notice, proxy card or voting instruction card you received. Proxy materials and Internet voting are available at www.okapivote.com/REEDS and if you need any assistance voting please contact Okapi Partners, LLC: email info@okapipartners.com or phone (877) 259-6290.

IT IS CRITICAL THAT YOU VOTE,

NO MATTER HOW MANY SHARES YOU OWN.

The Board of Directors urges stockholders to vote FOR the share issuance under Nasdaq rules (Proposal No. 2) and FOR the amendment (Proposal No. 4).

Approving the share issuance under the rules of The Nasdaq Stock Market LLC will:

	●	Enable holders to convert or receive “payments in common stock.
	●	Allow us flexibility to make certain payments in common stock.

Approving the amendment to our certificate of incorporation will:

●

Help ensure compliance with bid price rule required for continued listing of our common stock on The Nasdaq Capital Market

Our hearing appealing Nasdaq’s determination to delist the company’s securities from The Nasdaq Capital Market is scheduled for September 22, 2022. The delisting action has been stayed pending a final written decision by the Nasdaq Hearing Panel.

●

Provide adequate share reserve for the issuance of shares of our common stock pursuant to the Note Transaction

The total number of authorized shares of common stock will not be reduced in accordance with the exchange ratio, which will result in a significant increase in the availability of authorized shares of common stock.

●

Avoid a fundamental change under the Note Transaction

The delisting of our common stock from The Nasdaq Capital Market would constitute a “fundamental change” under the Note Transaction. In such circumstance, the holders would have the right to require us to repurchase the notes at a purchase price of 100% of the principal amount, plus accrued and unpaid interest. In addition, we would also be required to pay the holders a “Make-Whole Fundamental Change” payment.

In closing, we would like to thank you, our stockholders, for your continued support particularly over the last two years as we persevered through challenging economic conditions. We would also like to thank our employees for their continued dedication to our mission, and our customers, suppliers, co-packers and other colleagues for their partnership and commitment to our growth. We are confident that we are on track to achieve our growth and profitability targets through the continued growth of our flagship Reed’s Ginger Beer and Virgil’s full and zero sugar portfolios, as well as the ramp up of Reed’s Ginger Ale and our new RTD alcohol products. We will remain diligent with our various supply chain and cost saving initiatives while continuing to adapt as needed to the evolving macro environment. Our team is excited about the future of Reed’s and believe we have laid the groundwork to accomplish both our near and long-term goals. We remain committed to Reed’s becoming a profitable and financially stable company.

Cheers!

/s/ John J. Bello		/s/ Norman E. Snyder, Jr.
John J. Bello		Norman E. Snyder, Jr.
Chairman		Chief Executive Officer
August 31, 2022		August 31, 2022

201 Merritt 7 Corporate Park, Norwalk, Connecticut 06851

NOTICE OF ANNUAL MEETING OF STOCKHOLDERS TO BE

HELD ON October 5, 2022

Notice is hereby given that the 2022 Annual Meeting of Stockholders (“Annual Meeting”) of Reed’s, Inc. (“we”, “us”, “Reed’s” or the “company”), will be held at 11:00 a.m. Eastern time, on October 5, 2022. The Annual Meeting will be a completely virtual meeting, held via teleconference. You may attend the Annual Meeting by dialing 1-877-270-2148 (domestic) or 1-412-902-6510 (international) and by asking to be joined to the Reed’s, Inc. 2022 Annual Meeting of Stockholders. The Annual Meeting is called to conduct the following items of business:

	1.	To elect John J. Bello, Norman E. Snyder, Jr., Lewis Jaffe, James C. Bass, Louis Imbrogno, Jr., Leon M. Zaltzman and Thomas W. Kosler to serve a one-year term until their respective successors are duly elected and qualified or until their death, resignation, removal or disqualification (the “Election of Directors Proposal”);
	2.	To approve, for purposes of the rules of The Nasdaq Stock Market LLC, the potential issuance of more than 19.9% of our outstanding common stock upon conversion of our 10% Secured Convertible Notes (the “Convertible Note Share Issuance Proposal”);
	3.	To ratify the appointment of Weinberg & Company, P.A. as our independent registered public accounting firm for the fiscal year ending December 31, 2023 (the “Auditor Ratification Proposal”);
	4.	To approve an amendment to the company’s certificate of incorporation to effect a reverse stock split of the outstanding shares of the company’s common stock, par value $0.0001 per share, by a ratio of not less than one-for-six and not more than one-for-twenty-five at any time on or prior to December 31, 2022, with the exact ratio to be set at a whole number within this range by the board of the company in its sole discretion (the “Reverse Split Proposal”);
	5.	To approve, on an advisory basis, the compensation of Named Executive Officers (the “Say-On-Pay” Proposal);
	6.	To approve an adjournment of the Annual Meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal Nos. 2 and/ or 4 (the “Adjournment Proposal”); and
	7.	To transact such other business as may properly come before the annual meeting or any adjournment or postponement thereof.

All of the above matters are more fully described in the accompanying Proxy Statement.

All holders of record of our common stock as of the close of business on August 26, 2022, the record date, are entitled to notice of and to vote at this meeting and any adjournments or postponement thereof. A list of stockholders entitled to vote at the Annual Meeting will be available for inspection during the ten days prior to the Annual Meeting, during ordinary business hours, at Reed’s principal executive office. The stockholder list will also be available for review online during the virtual Annual Meeting. Any stockholder attending the virtual Annual Meeting may vote in person even if he or she has returned a proxy card.

Your vote is important. As described in your electronic proxy materials notice or on the enclosed proxy or voting instruction card, please vote by: (1) accessing the Internet website, (2) calling the toll-free number, or (3) signing, dating, and mailing the enclosed proxy or voting instruction card. We encourage you to vote via the Internet, as this is the most cost-effective method. In addition, if you vote via the Internet, you may elect to have next year’s Proxy Statement and Annual Report to Stockholders delivered to you electronically. We encourage you to enroll in electronic delivery, as it is a cost-effective way for us to provide you with proxy materials and annual reports. Even if you plan to attend the virtual Annual Meeting, we recommend that you vote your shares in advance, so that your vote will be counted if you later decide not to attend via teleconference.

If you have any questions or require any additional information concerning this Proxy Statement, please contact Okapi Partners, LLC at the address set forth below.

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1212 Avenue of the Americas, 24th Floor

New York, NY 10036

(212) 297-0720

Call Toll-Free at: (877) 259-6290

E-mail: info@okapipartners.com

	By Order of the Board of Directors,

	/s/ John J. Bello
	John J. Bello
	Chairman

Norwalk, Connecticut

August 31, 2022

Whether or not you intend to be present at the meeting, please sign and date the enclosed proxy and return it in the enclosed envelope or vote by telephone or online following the instructions on the proxy.

Important Notice Regarding the Internet Availability of Proxy Materials for

the Reed’s, Inc. 2022 Annual Meeting of Stockholders to be held on October 5, 2022

This Proxy Statement and Annual Report on Form 10-K for the year ended December 31, 2021 are available on the Internet at www.okapivote.com/REEDS

Table of Contents

*PROCEDURAL INFORMATION*	6
Important Notice	6
Voting Procedures	7
Frequently Asked Questions	8
Who may vote?	8
How do I attend the Annual Meeting?	8
Who are the proxies?	8
How do I specify how I want my shares voted?	8
What items will be voted upon at the Annual Meeting?	8
What is the board’s voting recommendation?	9
Who will solicit proxies on behalf of the board?	9
Who will pay for the costs involved in the solicitation of proxies?	10
Who can answer my questions?	10
How can I obtain additional copies of these materials or copies of other documents?	10
How can I provide my comments to the company?	11
How many votes are needed to have the proposals pass?	11
How are the votes counted?	11
How would my proxy be voted on other matters?	12
Who will pay for the costs involved in the solicitation of proxies?	12
Do stockholders have any dissenters’ right with regards to the matters proposed to be acted upon?	12
Where can I find the voting results of the Annual Meeting?	12
Is my vote confidential?	13
Conduct at the Annual Meeting	13
*PROPOSAL NO. 1 – ELECTION OF DIRECTORS*	13
Directors/ Nominees	13
Biographies of Nominees	14
Director Skills and Experience Matrix	17
Director Diversity Matrix (as of August 15, 2022)	18
*BOARD SELECTION AND EVALUATION*	18
Goal	18
Role of Governance Committee	18
Director Independence	20
*HOW THE BOARD IS ORGANIZED AND GOVERNS*	21
Leadership Structure	21
Board Structure	21
Audit Committee	22
Compensation Committee	22
Governance Committee	22
Operations Committee	23
Code of Ethics	24
Code of Ethical Business Conduct	24
Risk Oversight	25
Executive Sessions of Non-Management and Independent Directors	25
*COMMUNICATIONS WITH THE BOARD*	26
*CERTAIN CORPORATE GOVERNANCE MATTERS*	26
Board	26
Policy on Equity Ownership	26
Pledging of Shares	26
Insider Trading/Anti-Hedging Policies	27
Compensation Recovery and Clawback Policies	27
Board, Committee Meetings and Executive Sessions of Non-Management Independent Directors	27
*AUDIT COMMITTEE REPORT*	28
*CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS*	29
*EXECUTIVE OFFICERS*	31
*EXECUTIVE COMPENSATION*	33
Employment Agreements	33
Outstanding Equity Awards at Fiscal Year-End	35
*DIRECTOR COMPENSATION*	36
*EQUITY COMPENSATION PLAN INFORMATION*	36
*SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT*	37
*DELINQUENT SECTION 16(A) REPORTS*	38
*PROPOSAL NO. 2 - CONVERTIBLE NOTE SHARE ISSUANCE PROPOSAL*	39
*PROPOSAL NO. 3 – RATIFICATION OF AUDITORS PROPOSAL*	43
Independent Registered Public Accounting Firm Fee Information	43
Audit Committee Pre-Approval Policies and Procedures	44
*PROPOSAL NO. 4 – REVERSE STOCK SPLIT PROPOSAL*	45
*PROPOSAL NO. 5 – SAY-ON PAY-PROPOSAL*	56
*PROPOSAL NO. 6 - ADJOURNMENT PROPOSAL*	57
HOUSEHOLDING	57
*ANNUAL REPORT*	58
*STOCKHOLDER PROPOSALS FOR NEXT YEAR’S ANNUAL MEETING*	58
*STOCKHOLDER ADVISORY VOTES*	59
*OTHER MATTERS WHICH MAY BE PRESENTED FOR ACTION AT THE MEETING*	59
*INTEREST OF CERTAIN PERSONS IN OR OPPOSITION TO MATTERS TO BE ACTED UPON*	59

PROCEDURAL INFORMATION

The enclosed proxy is solicited by the board of directors (“board”) of Reed’s, Inc., a Delaware corporation, for use at the Reed’s, Inc. 2022 Annual Meeting of Stockholders (the “Annual Meeting”) and all postponements, continuations or adjournments thereof. These proxy materials and the enclosed Annual Report on Form 10K (“Annual Report”) for fiscal year ended December 31, 2021 are being mailed to our stockholders on or about August 31, 2022. In this Proxy Statement, we use the terms the “company,” “Reed’s” “we”, “our”, and “us” to refer to Reed’s, Inc.

References in the Proxy Materials to the “Annual Meeting” also refer to any adjournments, postponements or changes in location of the Annual Meeting, to the extent applicable.

About the Virtual Annual Meeting

The Annual Meeting will be a completely virtual meeting. There will be no physical meeting location and the meeting will only be conducted via live teleconference. You may attend the Annual Meeting by dialing 1-877-270-2148 (domestic) or 1-412-902-6510 (international) and by asking to be joined to the Reed’s, Inc. 2022 Annual Meeting of Stockholders. Please allow time for online login procedures.

References in the Proxy Materials to the “Annual Meeting” also refer to any adjournments, postponements or changes in location of the Annual Meeting, to the extent applicable.

Important Notice

Please promptly vote and submit your proxy by signing, dating and returning the enclosed proxy card in the postage-prepaid return envelope so that your shares can be voted. This will not limit your rights to attend or vote at the Annual Meeting.

Voting Procedures

A representative of Okapi Partners, LLC will tabulate votes and serve as Inspector of Election for the meeting. Each stockholder will be entitled to one vote for each share with respect to each matter to be voted on at the meeting. A “stockholder of record” is a person or entity who holds shares on the record date that are registered in such Stockholder’s name on the records of our transfer agent. A person or entity who holds shares through a broker, bank, or other nominee is considered a “beneficial owner” of the shares. You may receive more than one set of proxy materials. This means your shares are held in more than one account. Please vote all of your shares.

Voting by Stockholders of Record. If you are a stockholder of record, you may vote (i) through the Internet before or at the Annual Meeting, using the instructions on the proxy card and those posted at www.okapivote.com/REEDS, (ii) by telephone from the United States, using the number on the proxy card, or (iii) by completing and returning the enclosed proxy card. To help us keep our costs low in these extraordinary times, please vote through the Internet, if possible. Shares represented by proxy will be voted during the meeting and may be revoked at any time prior to the time at which voting closes during the meeting by (i) timely submitting a valid, later-dated proxy; (ii) delivering a written notice of revocation to Thomas J. Spisak, our Chief Financial Officer and Secretary; or (iii) voting online at the virtual meeting being held via teleconference. Please note that attending the meeting without casting a vote will not revoke any previously submitted proxy. If you properly complete and sign your proxy card, but do not indicate how your shares should be voted on a matter, the shares represented by your proxy will be voted in accordance with the recommendation of our board.

Voting by Beneficial Owners. If you are a beneficial owner of shares, these proxy materials are being forwarded to you by your broker (or bank or other nominee) who is considered the stockholder of record of your shares. As the beneficial owner of the shares, you are entitled to direct your broker as to how to vote your shares. You may so instruct your broker through the Internet or by telephone as described in the applicable instructions your broker has provided with these proxy materials. You may also vote by completing the voting instruction card the broker provides to you. To help us keep our costs low in these extraordinary times, please vote through the Internet, if possible. You may change your vote by submitting new voting instructions to your broker in accordance with such broker’s procedures. If you provide voting instructions to your broker, your shares will be voted as you direct. If you do not provide voting instructions, pursuant to the rules of the New York Stock Exchange (the “NYSE”), your broker may vote your shares only with respect to proposals as to which it has discretion to vote under the NYSE’s rules. For any other proposals, the broker may not vote your shares at all, which is referred to as a “broker non-vote.” Please note that, in the absence of your specific instructions as to how to vote, your broker may not vote your shares with respect to any of the proposals included in this Proxy Statement except for Proposal No. 3 (the Ratification Auditors Proposal), so please provide instructions to your broker regarding the voting of your shares. As the beneficial owner of shares, you are invited to attend the meeting at (www.okapivote.com/REEDS) by entering the 16-digit control number provided by your broker (or bank or other nominee) and vote your shares online during the meeting.

Frequently Asked Questions

Who may vote?

Admittance to the virtual meeting will be limited to stockholders. The board has fixed the close of business on August 26, 2022 as the record date for the determination of stockholders entitled to notice of and to vote at the Annual Meeting and any postponement or adjournment thereof. Accordingly, only stockholders of record at the close of business on that date will be entitled to vote at the meeting. A list of stockholders eligible to vote at the meeting will be available for inspection for a period of 10 days prior to the meeting, during regular business hours, at our corporate headquarters at the address set forth above. If you want to inspect the stockholder list prior to the meeting, please call Thomas J. Spisak, our Chief Financial Officer and Corporate Secretary at 1-203-890-0557 to schedule an appointment. In addition, the list of stockholders also will be available during the virtual Annual Meeting through the meeting website for stockholders who choose to attend.

How do I attend the Annual Meeting?

The Annual Meeting will be entirely virtual. You may attend the Annual Meeting by dialing 1-877-270-2148 (domestic) or 1-412-902-6510 (international) and by asking to be joined to the Reed’s, Inc. 2022 Annual Meeting of Stockholders. Please allow time for online login procedures. You will need to have your 16-digit control number included on your proxy card or on the instructions that accompanied your proxy materials to join the Annual Meeting.

Who are the proxies?

The board has appointed John J. Bello, our Chairman, and Norman E. Snyder, Jr., our Chief Executive Officer, to serve as proxies at the Annual Meeting. When you fill out your proxy card and return it, or if you vote electronically, you will be giving the proxies your instruction on how to vote your shares at the Annual Meeting.

How do I specify how I want my shares voted?

If you are a registered stockholder, you can specify how you want your shares voted on each proposal by marking the appropriate boxes on the proxy card. Please review the voting instructions on the proxy card and read the entire text of the proposals and the positions of the board in the Proxy Statement prior to marking your vote. If your proxy card is signed and returned without specifying a vote, it will be voted according to the recommendation of the board on that proposal.

What items will be voted upon at the Annual Meeting?

The following items will be voted upon at the Annual Meeting:

The election of John J. Bello, Norman E. Snyder, Jr., Lewis Jaffe, James C. Bass, Louis Imbrogno, Jr., Leon M. Zaltzman and Thomas W. Kosler to serve a one-year term until their respective successors are duly elected and qualified or until their death, resignation, removal or disqualification (the “Election of Directors Proposal”);

	2.	The approval, for purposes of the rules of The Nasdaq Stock Market LLC, the potential issuance of more than 19.9% of our outstanding common stock upon conversion of our 10% Secured Convertible Notes (the “Convertible Note Share Issuance Proposal”);
	3.	The ratification of the appointment of Weinberg & Company, P.A. as our independent registered public accounting firm for the fiscal year ending December 31, 2023 (the “Auditor Ratification Proposal”);
	4.	The approval of an amendment to the company’s certificate of incorporation to effect a reverse stock split of the outstanding shares of the company’s common stock, par value $0.0001 per share, by a ratio of not less than one-for-six and not more than one-for-twenty-five at any time on or prior to December 31, 2022, with the exact ratio to be set at a whole number within this range by the board of the company in its sole discretion. (the “Reverse Split Proposal”);
	5.	The approval, on an advisory basis, of the compensation of Named Executive Officers (the “Say-On-Pay Proposal”);
	6.	The approval of an adjournment of the Annual Meeting, if necessary, to solicit additional proxies if there are not sufficient votes in favor of Proposal Nos. 2 and/ or 4 above (the “Adjournment Proposal”); and
	7.	To transact such other business as may properly come before the annual meeting or any adjournment or postponement thereof.

The board does not currently know of any other matters that may be brought before the meeting for a vote. However, if any other matters are properly presented for action, it is the intention of the persons named on the proxy card to vote on them according to their best judgment.

What is the board’s voting recommendation?

For the reasons set forth in more detail later in the Proxy Statement, the board unanimously recommends a vote “FOR” the election of all nominees for director proposed by our board (Proposal No. 1). The board unanimously determined that the issuance of shares of our common stock upon conversion of the Convertible Secured Notes is in the best interests of Reed’s and its stockholders and recommends a vote “FOR” such approval (Proposal No. 2). The board unanimously recommends a vote “FOR” an adjournment of the Annual Meeting (Proposal No. 6), if necessary, to solicit additional proxies, if there are not sufficient votes in favor of Proposal Nos. 2 and/ or 4. The board unanimously ratified the selection of Weinberg & Company, P.A. as the company’s independent registered public accounting firm for the fiscal year ending December 31, 2023 (Proposal No. 3) which selection was made by the board’s Audit Committee and recommends a vote “FOR” Proposal No. 3. The board unanimously recommends a vote “FOR” the amendment to Reed’s certificate of incorporation to effect the reverse stock split of outstanding shares (Proposal No. 4). The board unanimously recommends a vote “FOR” the Say-On-Pay Proposal, an advisory vote approving the compensation of Named Executive Officers (Proposal No. 5).

Who will solicit proxies on behalf of the board?

The company has retained Okapi Partners, LLC, a proxy solicitation firm, who may solicit proxies on the board’s behalf. The original solicitation of proxies by mail may be supplemented by telephone, telegram, facsimile, electronic mail, Internet and personal solicitation by our directors, director nominees and certain of our executive officers and other employees (who will receive no additional compensation for such solicitation activities), or by Okapi Partners, LLC. You may also be solicited by advertisements in periodicals, press releases issued by us and postings on our corporate website or other websites. Unless expressly indicated otherwise, information contained on our corporate website is not part of this Proxy Statement. In addition, none of the information on the other websites listed in this Proxy Statement is part of this Proxy Statement. These website addresses are intended to be inactive textual references only.

Who will pay for the costs involved in the solicitation of proxies?

The entire cost of soliciting proxies on behalf of the board, including the costs of preparing, assembling, printing and mailing this Proxy Statement, the proxy card and any additional soliciting materials furnished to stockholders by, or on behalf of, the company, will be borne by the company. Copies of the company’s solicitation material will be furnished to banks, brokerage houses, dealers, voting trustees, their respective nominees and other agents holding shares in their names, which are beneficially owned by others, so that they may forward such solicitation material, together with our Annual Report to beneficial owners. In addition, if asked, the company will reimburse these persons for their reasonable expenses in forwarding these materials to the beneficial owners. We have engaged Okapi Partners, LLC to solicit proxies from stockholders in connection with the Annual Meeting. We will pay Okapi Partners, LLC a fee of $9,000 plus costs and expenses. In addition, we have agreed to indemnify Okapi Partners, LLC and certain related persons against certain liabilities arising out of or in connection with their engagement.

Who can answer my questions?

Your vote at this year’s Annual Meeting is important, no matter how many or how few shares you own. Please sign and date the enclosed proxy card or voting instruction form and return it in the enclosed postage-paid envelope promptly or vote by Internet or telephone. If you have any questions or require assistance in submitting a proxy for your shares, please call Okapi Partners, LLC, the firm assisting us in the solicitation of proxies:

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1212 Avenue of the Americas, 24th Floor

New York, NY 10036

(212) 297-0720

Call Toll-Free at: (877)259-6290

E-mail: info@okapipartners.com

How can I obtain additional copies of these materials or copies of other documents?

Complete copies of this Proxy Statement and Annual Report are also available at: www.okapivote.com/REEDS.

You may also contact Okapi Partners, LLC for additional copies. You are encouraged to access and review all of the important information contained in the proxy materials before voting.

How can I provide my comments to the company?

We urge you to let us know your comments about the company or to bring a particular matter to our attention by writing directly to us at Reed’s, Inc., 201 Merritt 7 Corporate Park, Norwalk, Connecticut 06851, attention: Thomas J. Spisak, Chief Financial Officer and Secretary.

How many votes are needed to have the proposals pass?

The affirmative vote of the majority of the shares represented at the meeting and entitled to vote on the matter at the Annual Meeting is required to elect the directors (Proposal No. 1) and to approve Proposal Nos. 2 (the Convertible Note Share Issuance Proposal), 3 (the Auditor Ratification Proposal), 5 (the Say-On-Pay Proposal) and 6 (the Adjournment Proposal). The affirmative vote of the majority of outstanding shares entitled to vote on the matter is required to approve Proposal No. 4 (the Reverse Split Proposal), effecting an amendment to the certificate of incorporation.

How are the votes counted?

You will have one vote for each share of our common stock that you owned on the record date. If the proxy card is properly executed and returned prior to the Annual Meeting, the shares of common stock it represents will be voted as you instruct on the proxy card. If a proxy card is unmarked, or if you indicate no vote, the shares of common stock it represents will be voted “FOR” Proposal No. 1, the election of directors recommended by the board, “FOR” Proposal No. 2, the Convertible Note Share Issuance Proposal, “FOR” Proposal No. 3, the Auditor Ratification Proposal, “FOR” Proposal No. 4, the Reverse Split Proposal, “FOR” Proposal No. 5, the Say-On-Pay Proposal, and “FOR” Proposal No. 6, the Adjournment Proposal.

No Cumulative Voting. Holders of common stock shall not be entitled to cumulate their votes for the election of directors or any other matters.

Abstentions. In all matters abstentions have the same effect as votes “AGAINST” the matter. Abstentions will be counted as present and entitled to vote for purposes of determining whether a quorum is present at the annual meeting.

Broker Non-Votes. Whether a proposal is considered a “routine” matter or a “non-routine” matter is subject to the interpretation of certain rules that are applicable to brokers. Nasdaq Rule 2251 currently governs when Nasdaq members may vote shares held for customers by adopting the FINRA Rules. The FINRA rule, in turn, currently prohibits members from voting any uninstructed shares, but also permits the member to follow the rules of another self-regulatory organization of which the broker is a member, such as NYSE, instead, provided that the records of the member clearly indicate the procedure it is following. Proposal No. 3 (the Ratification of Auditors Proposal) is considered a “routine” matter under NYSE guidelines. Any NYSE member broker who has received no instructions from its clients and participates in discretionary voting will have discretion to vote its clients’ uninstructed shares on Proposal No. 3. Normally, a reverse stock split would be coded as routine. However, since Proposal No. 2 (the Convertible Note Share Issuance Proposal) relates to Proposal No. 4 (the Reverse Stock Split Proposal) NYSE may code Proposal No. 4 as non-routine. As such, we expect that any NYSE member broker who has received no instructions from its clients and participates in discretionary voting will not have discretion to vote its clients’ uninstructed shares on Proposal No. 4.

If you are a beneficial holder and you wish to vote “for,” “against” or “abstain” from Proposal No. 3 and your broker is an NYSE member that participates in discretionary voting, you will have to provide your broker with such an instruction. Otherwise, your broker may vote in its discretion on this Proposal No. 3. On the other hand, a broker is not entitled to vote shares held for a beneficial owner on non-routine items contained in the remaining proposals, Proposals Nos. 1, 2, 4, 5 and 6. A “broker non-vote” occurs when a broker cannot vote on a matter without instructions from the beneficial holder and such instructions are not received. Under Delaware law “broker non-votes” are not considered entitled to vote and will have no effect on the outcome of Proposal Nos. 1, 2, 5 and 6. Under Delaware law “broker non-votes” will have the effect of “against” votes on the outcome of Proposal No. 4 - the Reverse Split Proposal. Shares underlying “broker non-votes” will be counted as present and entitled to vote for purposes of determining whether a quorum is present at the Annual Meeting since there is at least one routine item on the ballot.

Quorum. A majority of the shares of common stock outstanding on the record date of August 26, 2022, represented in person or by proxy, will constitute a quorum at the Annual Meeting. As of August 26, 2022 we had 112,948,265.95 shares of common stock outstanding. The number of shares required to be represented in person or by proxy at the Annual Meeting to constitute a quorum is 56,474,133.

How would my proxy be voted on other matters?

The persons named on the proxy card will have discretionary authority to vote on business other than Proposals 1-6 as may properly come before the Annual Meeting.

Who wIll pay for the costs involved in the solicitation of proxies?

This Proxy Statement is furnished in connection with the solicitation of proxies by the board of Reed’s. Reed’s will pay all costs of preparing, assembling, printing and distributing the proxy materials. Copies of proxy materials will be furnished to brokerage houses, nominees, fiduciaries and custodians to forward to beneficial owners of common stock held in their names. Our employees, officers and directors may, for no additional compensation, solicit proxies on behalf of the board through the mail, in person and by telecommunications. Upon request, we will reimburse brokerage firms and other record holders for their reasonable expenses incurred for forwarding solicitation material to beneficial owners of stock.

Do stockholders have any dissenters’ right with regards to the matters proposed to be acted upon?

There are no rights of appraisal or other similar rights of dissenters under the laws of the State of Delaware with respect to any of the matters proposed to be acted upon herein.

Where can I find the voting results of the Annual Meeting?

We expect to announce preliminary voting results at the Annual Meeting. The final voting results will be reported in a Current Report on Form 8-K that we expect to file with the Securities and Exchange Commission within four business days of the Annual Meeting, and that Form 8-K will be available on our website at www.drinkreedsinc.com/investors/sec-filings/.

Is my vote confidential?

Independent inspectors count the votes. Your individual vote is kept confidential from us unless special circumstances exist. For example, a copy of your proxy card will be sent to us if you write comments on the card, as necessary to meet applicable legal requirements, or to assert or defend claims for or against the company.

Conduct at the Annual Meeting

The Chairman of the Annual Meeting has broad responsibility and legal authority to conduct the Annual Meeting in an orderly and timely manner. This authority includes establishing rules for stockholders who wish to address the meeting. Only stockholders or their valid proxy holders may address the meeting. Copies of these rules will be available at the meeting. The Chairman may also exercise broad discretion in recognizing stockholders who wish to speak and in determining the extent of discussion on each item of business. In light of the number of business items on this year’s agenda and the need to conclude the meeting within a reasonable period of time, we cannot ensure that every stockholder who wishes to speak on an item of business will be able to do so.

PROPOSAL NO. 1 – ELECTION OF DIRECTORS

Our bylaws provide that the number of directors on the board shall be not less than one or more than nine. The board is empowered to fix the number of directors from time to time and it is currently set at seven. Proxies cannot be voted for a greater number of persons than the number of nominees named.

The Governance Committee of the board, comprised of independent directors, nominated, and the board approved the nominations of, seven persons to serve as directors until the 2023 annual meeting, or until each director’s successor is elected and qualified. Each of the nominees is currently serving as a director of Reed’s and has agreed to continue to serve if elected. Management expects that each of the nominees will be available for election, but if any of them is not a candidate at the time the election occurs, it is intended that the proxies will be voted for the election of another nominee to be designated by the board to fill any vacancy. Additionally, the board may elect additional members of the board to fill any additional vacancies.

DirectorS/ Nominees

All director nominees are currently serving as members of the board. The names and ages of the nominees are set forth in the table below:

SEC Form DEF 14A filed by Reeds Inc.