What changed in this filing

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Item 9A. Controls and Procedures

2021-03-30 compared with 2020-03-18 · 511 added, 759 removed, 257 unchanged (83% of the section changed)

Controls and Procedures

Management’s

Annual Report on Internal Control over Financial Reporting

Controls and Procedures

of Disclosure Controls and Procedures

the supervision and with the participation of our management, including our Chief Executive Officer and our Chief Financial Officer,

we conducted an evaluation of our disclosure controls and procedures, as such term is defined under Securities and Exchange Act

of 1934 Rules 13a-15(f).

Based on this evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that

the Company’s disclosure controls and procedures were not effective as of December 31, 2019.

Management’s

Report on Internal Control over Financial Reporting

management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term

is defined in Rule 13a-15(f) under the Exchange Act.

Because of its inherent limitations, internal control over financial reporting

may not prevent or detect misstatements.

Also, projections of any evaluation of effectiveness to future periods are subject to

risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies

or procedures may deteriorate.

Under the supervision and with the participation of our principal executive officer and principal

financial officer, our management conducted an evaluation of the effectiveness of our internal control over financial reporting

based on the framework in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of

the Treadway Commission (COSO).

Based on evaluation under these criteria, management determined, based upon the existence of the

material weaknesses described below, that we did not maintain effective internal control over financial reporting as of December

material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there

is a reasonable possibility that a material misstatement of our annual or interim financial statements would not be prevented

or detected on a timely basis.

Company’s management assessed the effectiveness of the Company’s internal control over financial reporting as of December

Management’s assessment identified the following material weaknesses in the Company’s internal control over

financial reporting:

IT Service Providers - The Company relies upon a variety of outsourced Information Technology (IT) service providers for key

elements of the technology infrastructure impacting its financial reporting process.

Certain of these outsourced IT service providers

could not provide System and Organization Controls (SOC) reports.

The Company did not have controls designed to assess the design

and operation of internal controls pertaining to these outsourced IT service providers over the period of reliance.

management did not effectively assess the design and operation of certain outsourced IT service providers’

internal controls,

certain of the Company’s controls over IT systems and business processes were also ineffective, to the extent that they

rely upon information that was subject to the outsourced IT service providers’

control environment.

of Duties - The Company did not maintain effective policies to ensure adequate segregation of duties within its accounting

Specifically, due to the size of the Company and the smaller nature of department teams, opportunities are limited

to segregate duties, resulting in inabilities to soundly manage segregation of job responsibilities.

Notwithstanding

the identified outsourced IT service providers and related COSO material weaknesses, management has concluded that the Financial

Statements included in this Annual Report on Form 10-K present fairly, in all material respects, the Company’s financial

position, results of operations and cash flows for the periods disclosed in conformity with U.S.

Weinberg & Company, P.A., our independent registered public accounting firm, has issued an attestation report on the Company’s

internal control over financial reporting included herein.

Management’s

Planned Remediation Activities

management has been actively engaged in developing and implementing remediation plans to address the outsourced IT service providers

and segregation of duties material weaknesses described above.

These remediation efforts are ongoing and include or are expected

to include the following:

procedures for the identification of control activities and monitoring of control performance

to ensure that the components of internal control relating to certain outsourced IT service

providers are present and functioning.

procedures and the frequency of independent reconciliations of significant accounts to

mitigate the lack of segregation of duties.

we conducted an evaluation of our disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Securities

Exchange Act of 1934, as amended (the “Exchange Act”).

Based on this evaluation, our Chief Executive Officer and our

Chief Financial Officer concluded that the Company’s disclosure controls and procedures were effective as of December 31,

2020 to provide reasonable assurance that information required to be disclosed in the reports that 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 our management, including our Chief Executive Officer and Chief Financial

Officer, as appropriate, to allow timely decisions regarding required disclosures.

Annual Report on Internal Control over Financial Reporting

management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in Rules

13a-15(f) and 15d-15(f) under the Exchange Act).

Our management, with the participation of our Chief Executive Officer and Chief

Financial Officer and the oversight of our audit committee, has evaluated the effectiveness of our internal control over financial

reporting as of December 31, 2020.

In assessing the effectiveness of our internal control over financial reporting, our management

used the framework established in Internal Control Integrated Framework (2013) issued by the Committee of Sponsoring Organizations

of the Treadway Commission (COSO).

Based on that evaluation, our management has concluded that our internal control over financial

reporting was effective as of December 31, 2020.

Annual Report does not contain an attestation report of our independent registered public accounting firm related to internal

control over financial reporting because the rules for smaller reporting companies provide an exemption from the attestation requirement.

of Previously Identified Material Weaknesses

As disclosed in Part II, Item 9A., “Controls

and Procedures,” in our Annual Report on Form 10-K for fiscal year ended December 31, 2019, management identified the following

control deficiencies during fiscal 2019 that constituted material weaknesses:

(1) we did not have controls designed to assess

the design and operation of internal controls pertaining to these outsourced information technology service providers over the

period of reliance and (2) we did not maintain effective policies to ensure adequate segregation of duties within its accounting

remediate these previously identified material weaknesses, our management, with oversight from our audit committee, implemented

a remediation plan, we designed and implemented controls related to the periodic monitoring and review of outsourced information

technology service providers, and we implemented procedures and independent reconciliations of significant accounts to mitigate

the lack of segregation of duties.

on the actions taken, management determined that our newly designed and enhanced controls were in place and operated effectively

for a sufficient period of time to enable us to conclude that the material weaknesses were remediated as of December 31, 2020.

in Internal Control over Financial Reporting

for the identification of the outsourced IT service providers and segregation of duties material weaknesses described above, there

were no changes during the quarter ended December 31, 2019 in our internal control over financial reporting that have materially

than as described above in the section “Remediation Efforts on Previously Identified Material Weakness,” there were

no other changes in our internal control over financial reporting during the quarter ended December 31, 2020, that have materially

affected, or are reasonably likely to materially affect, our internal control over financial reporting.

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or overriding of controls, and, therefore, can provide only reasonable assurance with respect to reliable financial reporting.

of its inherent limitations, our internal control over financial reporting may not prevent or detect all misstatements, including

the possibility of human error, the circumvention or overriding of controls, or fraud.

Effective internal controls can provide

only reasonable assurance with respect to the preparation and fair presentation of financial statements.

OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

the Board of Directors and Stockholders of Reed’s, Inc.

on Internal Control over Financial Reporting

have audited Reed’s, Inc.’s (the “Company”) internal control over financial reporting as of December 31,

2019, based on criteria established in Internal Control-Integrated Framework (2013) issued by the Committee of Sponsoring

Organizations of the Treadway Commission (COSO).

In our opinion, because of the effect of the material weaknesses described below

on the achievement of the objectives of the control criteria, the Company has not maintained effective internal control over financial

reporting as of December 31, 2019, based on the criteria established in Internal Control-Integrated Framework (2013)

issued by the COSO.

material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there

is a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not

be prevented or detected on a timely basis.

The following material weaknesses have been identified and included in management’s

IT Service Providers - The Company relies upon a variety of outsourced Information Technology (IT) service providers for key

elements of the technology infrastructure impacting its financial reporting process.

Certain of these outsourced IT service providers

could not provide System and Organization Controls (SOC) reports.

The Company did not have controls designed to assess the design

and operation of internal controls pertaining to these outsourced IT service providers over the period of reliance.

management did not effectively assess the design and operation of certain outsourced IT service providers’

internal controls,

certain of the Company’s controls over IT systems and business processes were also ineffective, to the extent that they

rely upon information that was subject to the outsourced IT service providers’

control environment.

of Duties - The Company did not maintain effective policies to ensure adequate segregation of duties within its accounting

Specifically, due to the size of the Company and the smaller nature of department teams, opportunities are limited

to segregate duties, resulting in inabilities to soundly manage segregation of job responsibilities.

also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB),

the balance sheets of the Company as of December 31, 2019 and 2018, and the related statements of operations, changes in shareholders’

equity, and cash flows for the years then ended, and the related notes.

These material weaknesses were considered in determining

the nature, timing, and extent of audit tests applied in our audit of the 2019 financial statements, and this report does not

affect our report dated March 18, 2020, which expressed an unqualified opinion thereon.

Company’s management is responsible for maintaining effective internal control over financial reporting, and for its assessment

of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Annual Report

on Internal Control Over Financial Reporting.

Our responsibility is to express an opinion on the Company’s internal control

over financial reporting based on our audit.

We are a public accounting firm registered with the PCAOB and are required to be

independent with respect to the Company in accordance with the U.S.

federal securities laws and the applicable rules and regulations

of the Securities and Exchange Commission and the PCAOB.

conducted our audit in accordance with the standards of the PCAOB.

Those standards require that we plan and perform the audit

to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material

audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting,

assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal

control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances.

that our audit provides a reasonable basis for our opinion.

and Limitations of Internal Control over Financial Reporting

company’s internal control over financial reporting is

a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial

statements for external purposes in accordance with generally accepted accounting principles.

A company’s internal

control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records

that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company;

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in

accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made

only in accordance with authorizations of management and directors of the company;

and (3) provide reasonable assurance

regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets

that could have a material effect on the financial statements.

of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements.

Also, projections

of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes

in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

Weinberg & Company, P.A.

Angeles, California

Because of its inherent limitations, our internal control over financial reporting may not prevent or detect all misstatements,

including the possibility of human error, the circumvention or overriding of controls, or fraud.

Effective internal controls can

provide only reasonable assurance with respect to the preparation and fair presentation of financial statements.

Other Information

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Financial Officer

Christopher R.

Chief Innovation Officer

Vice President of Sales

Sales Officer

President, Operations

Innovation Officer

Chairman of Governance Committee, member of Audit, Operations and Compensation Committees

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Experience of Directors and Executive Officers

was appointed as Chief Executive Officer and director of Reed’s effective March 1,

Prior to his promotion, Mr.

Snyder served as Chief Operating Officer of Reed’s from September2019 through February

Prior to joining Reed’s, Mr.

Snyder served as President and Chief Executive Office for Avitae USA, LLC, an

emerging premium new age beverage company that markets and sells a line of ready-to-drink caffeinated waters.

Prior to Avitae,

he served as the President and Chief Operating Officer for Adina For Life, Inc., President and Chief Executive Officer of High

Falls Brewing Company, and Chief Financial Officer, and later Chief Operating Officer of South Beach Beverage Company, known as

In prior experience, Mr.

Snyder served as Controller for National Football League Properties, Inc., and in various roles

at PriceWaterhouseCoopers during an eight-year tenure.

was appointed as Chief Executive Officer and director of Reed’s effective March 1, 2020.

his promotion, Mr.

Snyder served as Chief Operating Officer of Reed’s from September 2019 through February 29, 2020.

to joining Reed’s, Mr.

Snyder served as President and Chief Executive Office for Avitae USA, LLC, an emerging premium new

age beverage company that markets and sells a line of ready-to-drink caffeinated waters.

Prior to Avitae, he served as the President

and Chief Operating Officer for Adina For Life, Inc., President and Chief Executive Officer of High Falls Brewing Company, and

Chief Financial Officer, and later Chief Operating Officer of South Beach Beverage Company, known as SoBe.

In prior experience,

Snyder served as Controller for National Football League Properties, Inc., and in various roles at PriceWaterhouseCoopers

during an eight-year tenure.

Snyder earned a B.S.

in Accounting from the State University

of New York at Albany.

Spisak has served as Chief Financial Officer of Reed’s since December 2019.

Prior to joining Reed’s, Mr.

in Accounting from the State University of New York at Albany.

Spisak has served as Chief Financial Officer of Reed’s since December 2019.

Prior to joining Reed’s, Mr.

Spisak provided financial leadership, including extensive expertise over a broad range of finance functions during his 26 year

tenure in the North America region of Diageo, a multinational alcoholic beverage company with net sales over UK £12.9 billion

$16 billion).

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from the University of Rhode Island.

Christopher J.

our company in 1987.

Since inception, Mr.

Reed has served in the roles of Chairman, President, and Chief Executive Officer, and

is currently the company’s Chief Innovation Officer.

Reed has been a non-independent Director since our incorporation

Reed also served as Chief Financial Officer during fiscal year 2007 until October 1, 2007 and again from April 17,

2008 to January 19, 2010.

Reed remains a Director of the company with the election of John Bello as Chairman of the Board

by fellow Board members.

Reed has been responsible for our design and products, including the original product recipes, the

proprietary brewing process and the packaging and marketing strategies.

Reed received a B.S.

in Chemical Engineering in 1980

from Rensselaer Polytechnic Institute in Troy, New York.

Cohane has served as Reed’s Chief Sales Officer since March of 2008 and previously as Vice President of Sales since

From March 2001 until August 2007, Mr.

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degree in Business Administration from Merrimack College in North Andover, Massachusetts.

Bello is Reed’s Board Chairman, has served since November 29, 2016 and is a sales and marketing

He also served as Interim Chief Executive from September 30, 2019 through February 29, 2020.

Hubli was appointed Vice President of Operations effective September 28, 2020.

Hubli has nearly four decades of

diversified experience in supply chain and operations management.

From January 2015 to the present, he owned and operated Rockhouse

Services, LLC, a consultancy focused on operations & supply chain improvement.

From July 2014 to January 2015, he served as

SVP of Operations for Harvest Hill Beverage Company.

Prior, from August 2012 to July 2014, he served as VP of Operations for High

Ridge Brands with end-to-end operations accountability of a copacker based supply chain plus new product delivery & quality.

From March 2009 to July 2012, he served as VP of Operations of Kozy Shack Enterprises.

From March 2008 to March 2009, Mr.

was the VP of Operations for Fuze Beverages leading, directing S&OP;

managing all operations/supply chain activities while

integrating the business unit into Coca-Cola.

From 2000 to 2007, he served as a VP of Operations Strategy Development at Cadbury

Schweppes Americas Beverages where he created the long-term operations strategy.

From 1991 to 2000, Mr.

Hubli worked for the North

American division of Colgate Palmolive initially as Director of Technology and later as Director of Supply Chain Development.

In these roles he ran new product delivery across all business categories and spearheaded supply chain re-engineering initiatives.

At Nestle Foods, where he worked from 1987 to 1991, he held the positions of Manager Coffee/Tea Industrial Engineering and Marketing

Manager for the Nescafe brand.

Hubli began his five-year tenure with PepsiCo R&D in 1982 as Program Manager and subsequently

became Manager, Concentrate Operations leading copack production of aseptic juices for the Slice brand.

He began his career as

Logistics Analyst for Maxwell House Coffee, then a division of General Foods, in 1980.

Hubli earned a BS in Industrial Engineering

and an MBA, both in 1979 from the University of Rhode Island.

Reed founded our company in 1987.

Since inception, Mr.

Reed has served in the roles of Chairman, President, and Chief

Executive Officer, and is currently the company’s Chief Innovation Officer.

Reed has been a non-independent Director

since our incorporation in 1991.

Reed also served as Chief Financial Officer during fiscal year 2007 until October 1, 2007

and again from April 17, 2008 to January 19, 2010.

Reed remains a Director of the company with the election of John Bello

as Chairman of the Board by fellow Board members.

Reed has been responsible for our design and products, including the original

product recipes, the proprietary brewing process and the packaging and marketing strategies.

Reed received a B.S.

Engineering in 1980 from Rensselaer Polytechnic Institute in Troy, New York.

Bello is Reed’s Chairman and sales and marketing expert.

Since 2001, Mr.

has been the Managing Director of JoNa Ventures, a family venture fund.

Bello has been the Managing Director

of JoNa Ventures, a family venture fund.

From 2004 to 2012 Mr.

Bello also served as Principal and

General Partner at Sherbrooke Capital, a venture capital group dedicated to investing in leading, early stage health and wellness

Bello is the founder and former CEO of South Beach Beverage Company, the maker of nutritionally enhanced teas and

juices marketed under the brand name SoBe.

The company was sold to PepsiCo in 2001 for $370 million and in the same year Ernst

and Young named Mr.

Bello National Entrepreneur of the Year in the consumer products category for his work with SoBe.

Before founding

Bello spent fourteen years at National Football League Properties, the marketing arm of the NFL and served as its President

from 1986 to 1993.

Bello also served as Principal and General Partner at Sherbrooke

Capital, a venture capital group dedicated to investing in leading, early stage health and wellness companies.

founder and former CEO of South Beach Beverage Company, the maker of nutritionally enhanced teas and juices marketed under the

brand name SoBe.

The company was sold to PepsiCo in 2001 for $370 million and in the same year Ernst and Young named Mr.

National Entrepreneur of the Year in the consumer products category for his work with SoBe.

Before founding SoBe, Mr.

fourteen years at National Football League Properties, the marketing arm of the NFL and served as its President from 1986 to 1993.

As the President, Mr.

Bello has been credited for building NFL Properties into a sports marketing leader and

creating the model by which every major sports league now operates.

to working for the NFL, Mr.

Bello served in marketing and strategic planning capacities at the Pepsi Cola Division of PepsiCo

and in product management roles for General Foods Corporation on the Sanka and Maxwell House brands.

Bello has been credited for building NFL Properties into a sports marketing leader and creating the model

by which every major sports league now operates.

Prior to working for the NFL, Mr.

Bello served in marketing and strategic planning

capacities at the Pepsi Cola Division of PepsiCo Inc.

and in product management roles for General Foods Corporation on the Sanka

and Maxwell House brands.

As a board chair, Mr.

Bello has also worked with IZZE in brand building, marketing and strategic planning capacities.

Bello has also worked with IZZE in brand building, marketing and strategic planning

That brand was also sold to PepsiCo.

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to Bausch and Lomb, who markets a redness reduction eye drop under the Lumify brand name.

Doherty III has served as a director since January 10, 2018.

Doherty is the principal of Eastern Investment

He is also a principal of Raptor/ Harbor Reeds, SPV, LLC (“Raptor”), the Company’s largest stockholder,

which beneficially owns approximately 15% of the company’s outstanding equity securities as of December 31, 2019,

calculated pursuant to Rule 13d-3.

Doherty has joint voting and dispositive control of the equity securities held by Raptor

with another of its principals.

See Item 13, Certain Relationships and Related Transactions.

Bass has served as a director since September 29, 2017, is Chairman of the Audit Committee and member

of the Compensation Committee.

Bass is retired from the position of Chief Financial Officer and Senior Vice President of Sony

Interactive Entertainment America LLC, commonly referred to as the PlayStation business of Sony where he joined in 1995 as Vice

President of Finance.

Bass has more than thirty-five years of financial and international management experience and was responsible

for all of Sony’s financial operations and controls including general accounting and financial reporting, planning, analysis

and systems, treasury and risk management, internal audit, and federal, state and local income taxes.

Prior experience includes

holding several senior management positions encompassing fourteen years with Bristol-Myers Squibb Company, gaining international

experience running operations in parts of Asia and Europe.

Bass has served as a director since September 29, 2017, is Chairman of the Audit Committee and member of the Compensation

Bass is retired from the position of Chief Financial Officer and Senior Vice President of Sony Interactive Entertainment

America LLC, commonly referred to as the PlayStation business of Sony where he joined in 1995 as Vice President of Finance.

Bass has more than thirty-five years of financial and international management experience and was responsible for all of Sony’s

financial operations and controls including general accounting and financial reporting, planning, analysis and systems, treasury

and risk management, internal audit, and federal, state and local income taxes.

Prior experience includes holding several senior

management positions encompassing fourteen years with Bristol-Myers Squibb Company, gaining international experience running operations

in parts of Asia and Europe.

Bass also spent two years at Wang Laboratories as a Divisional Controller.

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Certified Public Accountants.

Jaffe has served as a director since October 19, 2016, is Chairman of the Governance Committee and a member

of the Audit and Compensation Committees.

Jaffe has served as a director since October 19, 2016, is Chairman of the Governance Committee and a member of the Audit

and Compensation Committees.

Since August 2014, Mr.

Jaffe is an Executive-in-Residence and Clinical Faculty at the

Fred Kiesner Center for Entrepreneurship, Loyola Marymount University.

He is also a technology futurist, Executive Coach and Public

Jaffe is an Executive-in-Residence and Clinical Faculty at the Fred Kiesner

Center for Entrepreneurship, Loyola Marymount University.

He is also a technology futurist, Executive Coach and Public Speaker.

Since January 2010 Mr.

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education and credentialing program.

Grossman has served as a director since September 29, 2017, serves as Chairman of the Compensation Committee

and is also a member of the Audit and Governance Committees.

Grossman has served as a director since September 29, 2017, serves as Chairman of the Compensation Committee and is

also a member of the Audit and Governance Committees.

Grossman has nearly two decades of investing and advisory experience

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has served as a director since August 2019.

He served a 40-year tenure at PepsiCo, bringing extensive

expertise in beverage supply chain and management.

At PepsiCo he served in a variety of field operating assignments and staff

positions including the role of Senior Vice President of Worldwide Technical Operations.

In this role he was responsible for Pepsi-Cola’s

He served a 40-year tenure at PepsiCo, bringing extensive expertise

in beverage supply chain and management.

At PepsiCo he served in a variety of field operating assignments and staff positions

including the role of Senior Vice President of Worldwide Technical Operations.

In this role he was responsible for Pepsi-Cola’s

worldwide beverage quality, concentrate operations, research & development and contract manufacturing, reporting directly

to the heads of Pepsi-Cola North America and PepsiCo Beverages International.

Since Imbrogno’s retirement from PepsiCo,

he has consulted for multiple companies including PepsiCo.

From time to time, we are a party to claims

and legal proceedings arising in the ordinary course of business.

Our management evaluates our exposure to these claims and proceedings

individually and in the aggregate and provides for potential losses on such litigation if the amount of the loss is estimable

and the loss is probable.

We believe that there are no material litigation

matters at the current time.

Although the results of such litigation matters and claims cannot be predicted with certainty, we

believe that the final outcome of such claims and proceedings will not have a material adverse impact on our financial position,

liquidity, or results of operations.

are committed to having sound corporate governance principles.

We believe that such principles are essential to running our business

efficiently and to maintaining our integrity in the marketplace.

There have been no changes to the procedures by which stockholders

may recommend nominees to our board of directors.

Qualifications

believe that our directors should have the highest professional and personal ethics and values, consistent with our longstanding

values and standards.

They should have broad experience at the policy-making level in business or banking.

They should be committed

to enhancing stockholder value and should have sufficient time to carry out their duties and to provide insight and practical

wisdom based on experience.

Their service on other boards of public companies should be limited to a number that permits them,

given their individual circumstances, to perform responsibly all director duties for us.

Each director must represent the interests

of all stockholders.

When considering potential director candidates, the board of directors also considers the candidate’s

character, judgment, diversity, age and skills, including financial literacy and experience in the context of our needs and the

needs of the board of directors.

board of directors has determined that five members of the board of directors, John J.

Bello James C.

Bass, Lewis Jaffe, Scott R.

Grossman, and Louis Imbrogno, Jr.

are independent under the rules of the

Nasdaq Stock Market, LLC.

We intend to maintain at least five independent directors on our board of directors in the

In 2014, Louis Imbrogno Jr.

served as Chief

Executive Officer of Constar International, Inc.

for a six-month period during a bankruptcy proceeding and subsequent sale in

a court administered public auction.

He was not an executive officer of the company prior to the initiation of the bankruptcy

Except as described above, to the best

of our knowledge, none of our executive officers or directors are parties to any material proceedings adverse to Reed’s,

have any material interest adverse to Reed’s or have, during the past ten years been subject to legal or regulatory proceedings

required to be disclosed hereunder.

Family Relationships

There are no family relationships between

any of our executive officers and directors.

Audit Committee of the Board

The Audit Committee was formed in January

The board has determined that each member of our Audit Committee is an “independent director” as defined by

Rule 5605(a)(2) of The NASDAQ Stock Market Rules and that members of the Audit Committee are independent under the additional

requirements of Rule 10A-3(b)(1) under the Securities Exchange Act of 1934 (the “Exchange Act”).

The board has determined

Bass meets SEC requirements of an “audit committee financial expert” within the meaning of the Sarbanes Oxley

Act of 2002, Section 407(b).

In addition, the board determined that (i) none of the Audit Committee members have participated

in the preparation of the financial statements of the company at any time during the past three years and (2) Audit Committee

members are able to read and understand fundamental financial statements.

Additionally, we intend to continue to have at least

one member of the Audit Committee whose experience or background results in the individual’s financial sophistication.

Audit Committee charter is posted on our website at www.reedsinc.com.

Chief Executive Officer and all senior financial officers, including the Chief Financial Officer, are bound by a Code of Ethics

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Our Code of Ethics is posted on our website at http://investor.reedsinc.com .

Structure and Committee Composition

of the date of this Annual Report, our board of directors has eight directors and the following four standing committees:

an Audit Committee, a Compensation Committee, a Governance Committee and an Operations Committee.

The Audit Committee, Compensation

Committee and Governance Committee were formed in January 2007.

The Operations Committee was formed in May 2017.

Our Audit Committee oversees our accounting and financial reporting processes, internal systems of accounting and

financial controls, relationships with independent auditors and audits of financial statements.

Specific responsibilities include

the following:

hiring and terminating our independent auditors;

the qualifications, independence and performance of our independent auditors;

the audit and non-audit services to be performed by our independent auditors;

the design, implementation, adequacy and effectiveness of our internal controls and critical accounting policies;

and monitoring the integrity of our financial statements and our compliance with legal and regulatory requirements as they

relate to financial statements or accounting matters;

with management and our independent auditors, any earnings announcements and other public announcements regarding our results

of operations;

the audit committee report that the SEC requires in our annual proxy statement.

Audit Committee is comprised of Lewis Jaffe, Scott R.

Grossman and James C.

Bass serves as Chairman of the Audit

We believe James C.

Bass meets SEC requirements of an “audit committee financial expert”

within the meaning

of the Sarbanes Oxley Act of 2002, Section 407(b).

Our Compensation Committee assists our Board in determining and developing plans for the compensation of our officers,

directors and employees.

Our Compensation Committee is comprised of Lewis Jaffe, James C.

Bass and Scott R.

Grossman serves as Chairman of our Compensation Committee.

In affirmatively determining the independence of a director who will

serve on the compensation committee, the Company’s Board considered all factors specifically relevant to whether the director

has a relationship to the Company which is material to the director’s ability to be independent from management in connection

with the duties of a committee member, including, without limitation:

(1) the source of compensation of the director, including

any consulting, advisory or other compensatory fee paid by the Company;

and (2) whether the director is affiliated with the Company,

or an affiliate of the Company.

Specific responsibilities include the following:

the compensation and benefits of our executive officers;

the performance objectives and actual performance of our officers;

administering

our stock option and other equity compensation plans.

Our Governance Committee assists the board of directors by identifying and recommending individuals qualified to

become members of our board, reviewing correspondence from our stockholders, and establishing, evaluating and overseeing our corporate

governance guidelines.

Our Governance Committee is currently comprised of Lewis Jaffe and Scott R.

Lewis Jaffe serves

as Chairman of the Governance Committee.

The board of directors has determined all of the members of the Nominations and Governance

Committee are independent under the rules of the Nasdaq Stock Market, LLC.

Our board of directors has adopted a written

charter for the Nominations and Corporate Governance Committee.

responsibilities include the following:

the composition, size and governance of our board of directors and its committees and making recommendations regarding future

planning and the appointment of directors to our committees;

a policy for considering stockholder nominees for election to our board of directors;

and recommending candidates for election to our board of directors.

Our Operations Committee assists the board of directors in fulfilling its oversight responsibilities

for matters relating to the Company’s operations, particularly those aspects which are most likely to affect stockholder

Our Operations Committee is currently comprised of Lewis Jaffe and Christopher J.

In furtherance of this purpose,

the Operations Committee has the following general oversight responsibilities:

and providing strategic advice and counsel to the Company regarding the business operations;

to the Board an independent assessment of the Company’s business operations as it relates to strategic initiatives.

Section 16(a) Reports

our knowledge, based solely upon a review of Forms 3 and 4 and amendments thereto filed

on EDGAR during our most recent fiscal year, the following individuals each filed one late Form 4:

Grossman, Lewis Jaffe, James C.

Bass (two transactions), John Bello, Christopher J.

Reed (nine transactions).

otherwise indicated, each late Form 4 filing covered one transaction.

Compliance with Section 16(a)

of the Exchange Act

16(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) requires our directors and executive

officers and beneficial holders of more than 10% of our common stock to file with the SEC initial reports of ownership and reports

of changes in ownership of our equity securities.

To our knowledge, based solely upon a review

of Forms 3 and 4 and amendments thereto furnished to Reed’s under 17 CFR 240.16a-3(e) during our fiscal year ended December

31, 2020 the following individuals each filed one late Form 4 representing one transaction (unless otherwise noted):

Spisak, Norman E.

Snyder, Jr., John Bello, Neal Cohane.

None of our officers or directors filed Form 5.

Stockholder Director Nomination Procedures

There have not been any material changes

to the procedures by which stockholders may recommend nominees to the our board of directors.

Executive Compensation

following table summarizes all compensation for fiscal years 2019 and 2018 earned by our “Named Executive Officers”

following table summarizes all compensation for fiscal years 2020 and 2019 earned by our “Named Executive Officers”

during the reported periods:

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Executive Officer (Former Chief Operating Officer)

(Former Interim

Chief Executive Officer, Chairman) (3)

Chief Executive Officer

$ 384,632 (4)

Innovation Officer

Interim Chief Executive Officer, Chairman) (3)

Financial Officer

Chief Financial Officer

$ 234,945 (5)

$ 210,936 (6)

Chief Financial Officer

Chief Operating Officer

$ 264,398 (8)

Vice President Sales)

Sales Officer

The amounts represent the fair value for share-based payment awards issued during the year.

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is included in this table.

In 2018, board compensation was $37,500 and consulting fees of $85,833.

Includes severance and vacation payout due to termination in the amount of $100,081.

Includes vacation payout due to termination in the amount

Includes stay bonus and severance in the amount of $80,776.

Includes severance of $352,240

Includes severance and vacation payout due to termination in

the amount of $54,686.

February 19, 2020, the board promoted Mr.

Snyder to the position of Chief Executive Officer, effective March 1, 2020.

succeeded John Bello who served as Interim Chief Executive Officer from September 30, 2019 through February 29, 2020.

Snyder a one-time bonus of 150,000 RSAs vesting March 1, 2020, subject to the conditions and limitations of the Company’s

Second Amended and Restated 2017 Incentive Compensation Plan, in conjunction with his promotion.

are in the process of finalizing an amendment to Mr.

Snyder’s executive employment agreement dated September 30, 2019 to

reflect the terms for his service in his new position as Chief Executive Officer.

His base annual salary was increased to $300,000

from $250,000 effective March 1, 2020, the effective date of his promotion to Chief Executive Officer.

his employment agreement currently in effect, on February 25, 2020, he received an equity award of 446,000 stock options, one-half

scheduled to vest in equal increments on an annual basis for four years and remainder to vest based on performance criteria to

be determined by the board of directors (or compensation committee of the board).

Snyder’s performance-based cash bonus

was set at a target amount of 30% of base salary for the term of his service as Chief Operating Officer.

The agreement provides

for acceleration of equity grants triggered by a “change of control”, as defined in the agreement and contains confidentiality,

invention assignment and non-solicitation covenants.

Snyder is also eligible to participate in the Company’s benefit

plans available to its executive officers.

Bello’s 2020 Director fees and compensation are also reported under the Director Compensation

board appointed Mr.

Snyder to the office of Chief Operating Officer, effective March 1, 2020.

Snyder succeeded John J.

who served as Interim Chief Executive Officer from September 30, 2019 through February 29, 2020.

The board granted Mr.

a one-time bonus of 150,000 RSAs vesting March 1, 2020, subject to the conditions and limitations of Reed’s Second Amended

and Restated 2017 Incentive Compensation Plan, in conjunction with his promotion.

Pursuant his employment agreement, on February

25, 2020, he received an equity award of 446,000 stock options, one-half scheduled to vest in equal increments on an annual basis

for four years and remainder to vest based on performance criteria to be determined by the board of directors (or compensation

committee of the board).

Snyder’s performance-based cash bonus was set at a target amount of 30% of base salary for

the term of his service as Chief Operating Officer.

The agreement provided for acceleration of equity grants triggered by a “change

of control”, as defined in the agreement and contains confidentiality, invention assignment and non-solicitation covenants.

Snyder is also eligible to participate in the company’s benefit plans available to its executive officers.

June 24, 2020, we entered into an amended and restated employment agreement with Norman E.

reflecting his promotion

to Chief Executive Officer on March 1, 2020.

The term of the agreement continues through March 1, 2023 and will automatically

renew for an additional one-year term, unless earlier terminated or unless notice of non-renewal is submitted by either party

90 days in advance.

Pursuant to the agreement, Mr.

Snyder’s base salary of $300,000 per year increased to $350,000 on September

30, 2020 based on satisfaction of certain objectives and to $360,500 on March 1, 2021.

Snyder is also eligible to receive

a performance-based cash bonus at a target amount of 50% of his base salary in effect.

He is also eligible to participate in Reed’s

other benefit plans available to its executive officers.

The agreement provides for acceleration of equity grants triggered by

a “change of control”, as defined in the agreement and contains customary, non-competition, confidentiality, invention

assignment and non-solicitation covenants.

Snyder is also entitled to six months’ severance benefits in the event of

termination without cause by Reed’s or for good reason by Mr.

Snyder, subject to execution of a release.

February 19, 2020 the board of directors granted John Bello 200,000 RSAs, vesting March 1, 2020, as compensation for his services

1 unchanged sentence

entered into an at-will employment agreement with Thomas J.

Spisak to serve as the Chief Financial Officer of Reed’s, effective

December 2, 2019.

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pursuant to the terms of the agreement.

Spisak receives a base salary of $250,000 per year.

Spisak is also eligible to

receive performance-based cash bonus at a target amount of 30% of his base salary.

Spisak’s base annual base salary was increased to $257,500 from $250,000 effective

March 1, 2020.

Spisak is also eligible to receive performance-based cash bonus at a target amount of 30% of his base salary.

Pursuant to his employment agreement, Mr.

received an initial equity award of 150,000 incentive stock options and 150,000 restricted stock awards on March 3, 2020, one-half

of the award (75,000 options and 75,000 restricted stock awards) vesting in equal increments on an annual basis for four years

and the remainder (75,000 options and 75,000 restricted stock awards) vesting based on performance criteria to be determined by

the board of directors or compensation committee.

Spisak is also eligible to participate in Reed’s other benefit plans

available to its executive officers.

The agreement contains customary confidentiality, non-competition and invention assignment

November 22, 2019, we entered into a Separation, Settlement and Release of Claims Agreement with Stefan Freeman, our former Chief

Operating Officer in connection with Mr.

Freeman’s resignation from his position as Chief Operating Officer of Reed’s

and the subsequent termination of his employment effective November 30, 2019.

The agreement supersedes and replaces his Employment

Agreement dated October 4, 2017 and provides for the payment of certain severance benefits by Reed’s to Mr.

Freeman including

the following:

(a) salary continuation in an amount equal to 7 months’

salary at Mr.

Freeman’s base salary rate, less

all applicable withholdings and (b) payment of Mr.

Freeman’s COBRA premium for earlier of seven months or until commencement

of coverage sponsored by subsequent employer (including employer of spouse).

In addition, the Separation Agreement contains a

general mutual release related to Mr.

Freeman’s employment with the Reed’s and customary confidentiality, non-disclosure,

non-solicitation and non-disparagement provisions.

October 31, 2019, we entered into a Separation, Settlement and Release of Claims Agreement with Valentin Stalowir, our former

Chief Executive Officer in connection with Mr.

Stalowir’s resignation from his position as Chief Executive Officer of Reed’s

and the subsequent termination of his employment on October 31, 2019.

The agreement supersedes and replaces his Employment Agreement

dated June 28, 2019 (as amended) and provides for the payment of certain severance benefits by Reed’s to Mr.

Stalowir including

the following:

(a) salary continuation in an amount equal to approximately 11 months’

salary at Mr.

Stalowir’s base

salary rate, less all applicable withholdings;

(b) payment of Mr.

Stalowir’s COBRA premium for earlier of eleven months

or until commencement of coverage sponsored by subsequent employer;

Stalowir’s stock

options reflecting conversion of 461,554 incentive stock options vested through the Separation Date to an equal number of nonqualified

stock options exercisable through October 31, 2022;

(d) acceleration of 50,000 shares of common stock of Reed’s underlying

previously granted restricted stock awards plus delivery of all previously vested restricted stock awards and (e) payment of certain

legal accounting fees and expenses incurred by Mr.

Stalowir negotiating his separation.

In addition, the agreement contains a

general mutual release related to Mr.

Stalowir’s employment with the Reed’s customary confidentiality, non-disclosure,

non-solicitation and non-disparagement provisions.

August 15, 2018, we entered into a Separation, Settlement and Release of Claims Agreement with Daniel V.

Miles in connection with

resignation from his position as Chief Financial Officer of Reed’s and the termination of his employment.

Pursuant to the agreement, for a period of one year, Mr.

Miles agreed to make himself available, to the extent reasonably requested

by Reed’s, for the purpose of assisting with the transition of his duties, on an hourly basis.

The agreement provided for

the following payments to Mr.

(a) salary continuation in an amount equal to 12 months’

salary at Mr.

Miles’s

base salary rate plus annual cash bonus, less all applicable withholdings, and subject to deduction of net compensation received

Miles from subsequent employment or engagement during this period;

(b) payment of the lesser of (i) Mr.

premium or (ii) active employee rates payable pursuant to subsequent-employer sponsored health care coverage, for twelve months;

and (c) settlement amount in the sum of $207,200.00, paid through the issuance of a promissory note by Reed’s in favor of

Miles, which note matured on August 15, 2019.

The agreement memorialized of the terms of Mr.

currently exercisable

stock options at the time.

In addition, the agreement contains a general release by Mr.

Miles related to Mr.

Miles’s employment

with the Company, customary confidentiality and non-disclosure provisions and a non-disparagement clause.

Officers without Employment Agreements

Reed is currently paid an annual salary of $113,500.

Neal Cohane is paid an annual salary of $210,000.

Bonuses for these

individuals are discretionary.

Spisak received an initial equity award of 150,000 incentive stock options and 150,000

restricted stock awards on March 3, 2020, one-half of the award (75,000 options and 75,000 restricted stock awards) vesting in

equal increments on an annual basis for four years and the remainder (75,000 options and 75,000 restricted stock awards) vesting

based on performance criteria to be determined by the board of directors or compensation committee.

Spisak is also eligible

to participate in Reed’s other benefit plans available to its executive officers.

The agreement contains customary confidentiality,

non-competition and invention assignment covenants.

Salary Arrangements of Other Executive Officers

Cohane receives an annual salary which increased from $210,000 to $250,000 on March 1, 2021 with a 30% bonus target, and he is

eligible to participate in benefits offered by the company to its executive officers.

Hubli receives an annual salary of $200,000 with a 30% bonus target, and he is eligible to participate in benefits offered

by the company to its executive officers.

Reed receives an annual salary of $113,500.

Change-in-Control

is our general policy that awards that vest over a term greater one-year include provisions for acceleration upon a change-in-control.

2017 Plan provides the consequences of a change-in-control provisions may be set forth in individual award agreements.

of the 2020 Plan, a “change in control” generally includes (a) the acquisition of more than 50% of the company’s

common stock, (b) the acquisition within a twelve-month period of 30% or more of the Company’s common stock, (c) the replacement

of a majority of the board of directors, within a twelve-month period, by directors whose election was not endorsed by the incumbent

board, or (d) the acquisition of all or substantially all of the Company’s assets.

Equity Awards at Year-End

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Officer outstanding as of December 31, 2020:

Options (#) Exercisable

Incentive Plan Awards:

Number of Securities

Executive Officer, Former Chief Operating Officer

Chief Executive Officer

Innovation Officer

Chief Financial Officer

Chief Operating Officer

Sales Officer

of Shares or Units of Stock That Have Not Vested (#)

Value of Shares or Units of Stock That Have Not Vested ($)

Incentive Plan Awards:

Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)

Incentive Plan Awards:

Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($)

(Chief Executive

Officer, Former Chief Operating Officer)

Former Interim Chief

Executive Officer, Chairman

Financial Officer)

(Chief Sales Officer)

options will vest in 2021.

2 unchanged sentences

following table summarizes the compensation paid to our non-employee directors for the year ended December 31, 2020:

Fees Earned or

Stock Awards (1)

Incentive Plan

Doherty, III (3)

Imbrogno, Jr.

The amounts represent the fair value of restricted stock awards granted during the year.

amounts represent the fair value of restricted stock awards granted during the year.

The award is calculated on the date of

grant in accordance with Financial Accounting Standards, excluding any impact of assumed forfeiture rates.

Bello’s

director fees and awards are also reported in the Executive Compensation Table.

Bello’s 2020 director fees and awards are also reported under the Executive Compensation Table.

Doherty, III resigned from his position as director effective December 31, 2020.

Security Ownership of Certain Beneficial Owners, Management and Related Stockholder Matters

8 unchanged sentences

in the table for our directors and executive officers is exercised solely by the beneficial owner or shared by the owner and the

owner’s spouse or children.

purposes of this table, a person or group of persons is deemed to have “beneficial ownership”

of any shares of common

owner’s spouse or children.

purposes of this table, a person or group of persons is deemed to have “beneficial ownership” of any shares of common

stock that such person has the right to acquire within 60 days of March 22, 2021.

9 unchanged sentences

the principal address of each listed executive officer and director is 201 Merritt 7 Corporate Park, Norwalk, Connecticut 06851.

TO ADD NEWLY LISTED PERSONS]

Beneficial Owner

2 unchanged sentences

Shares Beneficially

Doherty III (3)

Stalowir (10)

and Named Executive Officers as a group (8 persons)

1 unchanged sentence

Harbor Reed SPV LLC (10)

Handelsbanken

Asset Management

Square Park Partners

* Less than 1%

Asset Management Partners Inc

Based on 86,317,096 shares outstanding as of December 31, 2020.

Includes 183,201 shares issuable upon exercise of currently-exercisable options.

Doherty has joint voting and dispositive control of the equity securities held by Raptor with another of its principals.

Christopher J.

Reed, director and Chief Innovation Officer, and Judy Holloway Reed, are husband and wife and share beneficial

ownership of these shares.

Reed is a Named Executive Officer.

Reed is not a Named Executive Officer.

Includes 40,000 shares

issuable upon exercise of currently-exercisable options.

Includes 122,031 shares issuable upon exercise of currently-exercisable options.

Includes 30,000 shares issuable upon exercise of currently-exercisable options.

Includes 100,000 shares issuable upon exercise of currently-exercisable options, 24, 590 RSAs from 2021 Board Compensation, 400,000

shares of restricted common stock, and warrants of 133,201.

Includes 256,290 shares issuable upon exercise of currently-exercisable options.

Includes 341,308 shares issuable upon exercise of currently-exercisable options.

(10) Includes 461,554 shares issuable upon

exercise of currently-exercisable options.

Principal address is 280 Congress Street, 12th Floor Boston,

Massachusetts 02210.

Includes 3,143,333 shares of common stock issuable upon exercise of currently-exercisable warrants.

Also includes 2,266,667 shares of common stock issuable upon conversion of the Convertible Non-Redeemable Secured Promissory Note

in the original principal amount of $3,400,000.

Includes 80,000 shares issuable upon exercise of currently-exercisable options and 24,590 RSAs from 2021 Board Compensation.

Includes 80,000 shares issuable upon exercise of currently-exercisable

options and 24,590 RSAs from 2021 Board Compensation.

Includes 167,917 shares issuable upon exercise of currently-exercisable

Includes 80,000 shares issuable upon exercise of currently-exercisable options and 24,590 RSAs from 2021 Board Compensation.

Includes 69,950 shares issuable upon exercise of currently-exercisable options and 24,950 RSAs from 2021 Board Compensation

Principal address is 280 Congress Street, 12th Floor Boston, Massachusetts 02210.

Includes 2,810,000 shares of common stock issuable

upon exercise of currently-exercisable warrants.

Securities Authorized for Issuance under

Equity Compensation Plans

On September 29, 2017, the 2017 Incentive

Compensation Plan for 3,000,000 shares was approved by our shareholders.

On December 13, 2018 the Amended and Restated 2017 Incentive

Compensation Plan was approved by our shareholders increasing the number of shares issuable by 3,500,000 to 6,500,000.

16, 2019, the Second Amended and Restated 2017 Incentive Compensation Plan (“2017 Plan”) was approved by our shareholders,

increasing the number of shares issuable by 1,000,000 to 7,500,000.

On December 21, 2020, the 2020 Equity Incentive Plan (“2020

Plan”) for 8,500,000 shares was approved by our shareholders.

The 2020 Plan replaced the 2017 Plan, which will expire by

its terms on September 30, 2027.

We have discontinued the 2017 Plan and all plans that preceded the 2017 Plan and will not issue

any new awards under these prior plans, although awards granted under these plans will remain in effect.

The following table provides information,

as of December 31, 2020, with respect to equity securities authorized for issuance under compensation plans:

Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants

Weighted-Average Exercise Price of Outstanding Options, Warrants and Rights

Number of Securities Remaining Available for Future Issuance Under Equity Compensation

Plans (excluding securities

Plan Category

Equity compensation plans approved by security holders

Equity compensation plans not approved by security holders

Certain Relationships and Related Transactions, and Director Independence

1 unchanged sentence

board of directors has adopted written policies and procedures for the review of any transaction, arrangement or relationship

between Reed’s and one of our executive officers, directors, director nominees or 5% or greater stockholders (or their immediate

family members), each of whom we refer to as a “related person,”

in which such related person has a direct or indirect

between Reed’s and one of our executive officers, directors, director nominees or 5% or greater stockholders (or their immediate

family members), each of whom we refer to as a “related person,” in which such related person has a direct or indirect

material interest.

a related person proposes to enter into such a transaction, arrangement or relationship, defined as a “related party transaction,”

the related party must report the proposed related party transaction to our Chief Financial Officer.

5 unchanged sentences

The board of directors

has determined all of the members of the Governance Committee are independent under the rules of the Nasdaq Stock Market,

has determined all of the members of the Governance Committee are independent under the rules of the Nasdaq Stock Market, LLC.

If practicable, the reporting, review and approval will occur prior to entry into the transaction.

If advance review

and approval is not practicable, the Governance Committee will review, and, in its discretion, may ratify the related party transaction.

Any related party transactions that are ongoing in nature will be reviewed annually at a minimum.

The related party transactions

listed below were reviewed by the full board of directors.

Prior to August 2005, we did not have independent directors on our

board to review and approve related party transactions.

If advance review and approval

is not practicable, the Governance Committee will review, and, in its discretion, may ratify the related party transaction.

related party transactions that are ongoing in nature will be reviewed annually at a minimum.

The related party transactions listed

below were reviewed by the full board of directors.

Prior to August 2005, we did not have independent directors on our board to

review and approve related party transactions.

The Governance Committee shall review future related party transactions.

following includes a summary of transactions since the beginning of fiscal 2019 or any currently proposed transaction,

in which we were or are to be a participant and the amount involved exceeded or exceeds the lesser of $120,000 or one percent

of the average of our total assets at year-end for the last two completed fiscal years and in which any related person had or

will have a direct or indirect material interest (other than compensation described under “Executive Compensation”).

We believe the terms obtained or consideration that we paid or received, as applicable, in connection with the transactions described

below were comparable to or better than terms available or the amounts that would be paid or received, as applicable, in arm’s-length

transactions.

with California Custom Beverage, LLC, (“CCB”)

December 31, 2018, the Company completed the sale of the Company’s Los Angeles manufacturing plant to California Custom

Beverage, LLC, (“CCB”), an entity owned by Chris Reed, founder, Chief Innovation Officer and a member of our board

of directors of Reed’s.

By the terms of the sale, CCB was to reimburse the Company for certain costs such as sales tax arising

from the transaction and prepayments.

Such costs aggregated $195,000 which is reflected as Receivable from Related Party on the

accompanying balance sheet as of December 31, 2018, and was collected from CCB during the year ended December 31, 2019.

in 2019, we are to receive a 5% royalty on CCB’s private label sales to existing customers for three years and a 5% referral

fee on CCB’s private label sales to referred customers for three years.

For the year ended December 31, 2019, the Company

recorded royalty revenue from CCB of $128,000 which is recorded as a receivable at December 31, 2019.

In addition, at December

31, 2019, the Company has outstanding receivable from CCB of $228,000 consisting of inventory advances to CCB.

2018, we entered into a three-year co-packing agreement with CCB, whereby CCB produces Reed’s beverages in glass bottles

at prevailing West Coast market rates.

During the year ended December 31, 2019, purchases from CCB under our co-packing agreement

amounted to $1,600,00 and at December 31, 2019, accounts payable to CCB totaled $182,000.

[Please see correction to date in notes

to financials]

Martin, daughter of a director of John J.

Bello, continued her employment with Reed’s as Vice President of Marketing during

the year ended December 31, 2019.

She was paid approximately $161,000 for her services in 2019.

following includes a summary of transactions since the beginning of fiscal 2019 or any currently proposed transaction, in which

we were or are to be a participant and the amount involved exceeded or exceeds the lesser of $120,000 or one percent of the average

of our total assets at year-end for the last two completed fiscal years and in which any related person had or will have a direct

or indirect material interest (other than compensation described under “Executive Compensation”).

We believe the terms

obtained or consideration that we paid or received, as applicable, in connection with the transactions described below were comparable

to or better than terms available or the amounts that would be paid or received, as applicable, in arm’s-length transactions.

with California Custom Beverage, LLC (“CCB”)

December 31, 2018, after completion of bidding process, Reed’s sold its beverage manufacturing equipment and private label

beverage business for a purchase price of $1.25 million pursuant to an asset purchase agreement of the same date with California

Custom Beverage, LLC (“CCB”), an entity owned by Christopher J.

Reed, founder, Chief Innovation Officer and director

Reed obtained debt financing from a commercial bank, PMC Financial Services, LLC, in the amount of $1,050,000.

In addition, in support of the transaction, a group of current Reed’s stockholders, including Chairman John J.

certain institutional investors, purchased 350,000 shares of common stock of REED from Christopher J.

Reed at $2.00 per share,

in a private transaction exempt from the registration requirements of the Securities Act of 1933.

The pricing was based on the

higher of $2.00 per share or a 10% discount to the 5-day volume weighted average price ending December 28, 2018.

part of the transaction, CCB assumed the monthly payments on our lease obligation for the Los Angeles manufacturing plant.

release from the obligation by the lessor, however, is dependent upon CCB’s deposit of $1.2 million of security with the

The deposit is secured by Mr.

Reed’s pledge of common stock to the lessor and guaranteed personally by Mr.

and his wife.

As of December 31, 2020, $800 has been deposited with the lessor and Mr.

Reed has placed approximately 363,000 pledged

shares valued at $338 that remain pledged in in escrow in favor of lessor.

plant equipment was sold to CCB on an “as-is, where is” basis.

In addition, the parties entered into a 3-year co-packing

contract for the production of Reed’s beverages in glass bottles at prevailing West Coast market rates.

Certain transitional

services were provided by Reed’s to CCB for 30 days.

The transaction documents also contain customary protections for intellectual

property, indemnification and non-competition provisions.

in 2019, we began receiving a 5% royalty on CCB’s private label sales to existing customers for three years and a 5% referral

fee on CCB’s private label sales to referred customers for three years.

During the year ended December 31, 2020, the Company

recorded royalty revenue from CCB of $98.

During the year ended December 31, 2019, the Company recorded royalty revenue from CCB

December 31, 2019, the Company had royalty revenue receivable from CCB of $128.

In addition, at December 31, 2019, the Company

has outstanding receivable from CCB of $228 consisting of inventory advances to CCB.

The aggregate receivable from CCB at December

31, 2019 was $356.

During the year ended December 31, 2020, the Company recorded royalty revenue receivable of $98, advanced inventory

and equipment of $381, and reduced CCB receivable by $153 and reducing CCB payable of $153, leaving an aggregate receivable balance

of $682 at December 31, 2020.

December 31, 2020 and December 31, 2019, the Company had accounts payable due to CCB of $557 and $182, respectively.

of Secured Convertible Subordinated Non-redeemable Note with Raptor/ Harbor Reeds SPV, LLC

December 11, 2020, we entered into a Satisfaction, Settlement and Release Agreement (“Satisfaction Agreement”) with

Raptor/ Harbor Reeds SPV, LLC (“Raptor”) satisfying all of our obligations to Raptor as our junior secured lender.

Raptor is a related party.

Doherty III, a former director of Reed’s, is a principal and member of Raptor.

transaction was completed on December 15, 2020.

to this transaction, our obligation under that certain Senior Secured Amended and Restated Subordinated Convertible Non-Redeemable

Secured Note (“Subordinated Note”) dated October 4, 2018 in favor of Raptor, including accrued and unpaid interest

through maturity on April 21, 2021, was approximately $5.5 million.

full satisfaction of the Subordinated Note, including release of collateral, and termination of related junior lender documentation,

we (a) paid Raptor $4,250,000 in cash, (b) issued to Raptor a 5-year warrant to purchase 1,000,000 shares of common stock, $0.0001

par value, of Reed’s (“Common Stock”) with an exercise price of $0.644 (“Satisfaction Warrant”),

and (c) issued to Raptor 1,339,286 shares of Common Stock upon conversion of $750,000.00 of the Subordinated Note at the reduced

per share conversion price of $0.56.

Satisfaction Agreement includes a mutual release of liability.

The Satisfaction Warrant contains customary protection for stock

splits, dividends and reclassifications and provides certain rights in the event of a “Fundamental Transaction” as

therein defined.

Pursuant to a Registration Rights Agreement (“RRA”) dated December 11, 2020, the company also agreed

to file a registration statement registering shares of Common Stock underlying the warrant for resale, provided however, sales

under the registration statement may not commence until the 6th trading day after Reed’s files its Annual Report on Form

10-K for the period ending December 31, 2020 with the Securities Exchange Commission.

senior lender, Rosenthal & Rosenthal Inc.

(“Rosenthal”), a New York corporation consented to the settlement transaction

subject to pay-down by Reed’s of senior credit line obligation to zero, in compliance with terms of existing financing documents,

release of collateral securing the Subordinated Note and other customary requirements.

to Financing Agreement

March 11, 2021, we entered into an amendment (“Amendment”) to that certain Financing Agreement dated October 4, 2018,

as amended or supplemented with our senior secured lender, Rosenthal & Rosenthal, Inc.

(“Rosenthal”) releasing

that irrevocable standby letter of credit by Daniel J.

Doherty, III and Daniel J.

Doherty, III 2002 Family Trust in the amount

of $1.5 million (“LC”), which served as financial collateral for certain obligations of Reed’s under the Rosenthal

credit facility, with a two million dollar ($2,000,000) pledge of securities to Rosenthal by John J.

Bello and Nancy E.

as Co-Trustees of THE JOHN AND NANCY BELLO REVOCABLE LIVING TRUST, under trust agreement dated December 3, 2012, evidenced by

that certain Pledge Agreement to Rosenthal, and as to which Rosenthal has a first and only perfected security interest by the

Securities Account Control Agreement held by securities broker (“Bello Pledge”).

Bello, current Chairman and former Interim Chief Executive Officer of Reed’s, is a related party.

He is also a greater

than 5% beneficial owner of Reed’s common stock.

As consideration for the collateral support, Mr.

Bello received 400,000

shares of Reed’s restricted stock.

Martin, daughter of a director of the Company, was employed as Vice President of Marketing during the years ended December 31,

2020 and 2019.

Martin was paid approximately $215 and $161, respectively, for her services during the years ended December

31, 2020 and 2019, respectively.

Director Independence

As of the date of this Annual Report, our

board has seven directors and the following four standing committees:

an Audit Committee, a Compensation Committee, a Governance

Committee and an Operations Committee.

The board, upon recommendation from the Compensation Committee, determined through 2020,

each of John J.

Bello, Lewis Jaffe, James C.

Bass, Scott R.

Grossman and Louis Imbrogno is an “independent director”

as defined by Rule 5605(a)(2) of The NASDAQ Stock Market Rules (the “NASDAQ Rules”).

Independence of board members

is re-evaluated by the board annually.

The board determined affirmatively that John J.

Bello’s service as Interim Chief

Executive Officer and the compensation received for such service would not interfere with his ability to exercise independent

judgment as a director.

Subsequently, in March of 2021, the board, upon recommendation from the Compensation Committee, determined

Bello is no longer an “independent director” due to collateral support he now provides on behalf of the

Company to the Company’s senior secured lender, Rosenthal & Rosenthal, Inc.

We intend to maintain at least a majority

of independent directors on our board in the future.

Principal Accounting Fees and Services

& Company, P.A.

(“Weinberg”) was our independent registered public accounting firm for the years ended December

31, 2020 and 2019.

2 unchanged sentences

Audit-Related

defined by the SEC, (i) “audit fees”

are fees for professional services rendered by our principal accountant for the

defined by the SEC, (i) “audit fees” are fees for professional services rendered by our principal accountant for the

audit of our annual financial statements and review of financial statements included in our Form 10-K, or for services that are

normally provided by the accountant in connection with statutory and regulatory filings or engagements for those fiscal years;

(ii) “audit-related fees”

are fees for assurance and related services by our principal accountant that are reasonably

related to the performance of the audit or review of our financial statements and are not reported under “audit fees;”

(iii) “tax fees”

are fees for professional services rendered by our principal accountant for tax compliance, tax advice,

(ii) “audit-related fees” are fees for assurance and related services by our principal accountant that are reasonably

related to the performance of the audit or review of our financial statements and are not reported under “audit fees;”

(iii) “tax fees” are fees for professional services rendered by our principal accountant for tax compliance, tax advice,

and tax planning;

and (iv) “all other fees”

are fees for products and services provided by our principal accountant,

other than the services reported under “audit fees,”

“audit-related fees,”

and “tax fees.”

and (iv) “all other fees” are fees for products and services provided by our principal accountant,

other than the services reported under “audit fees,” “audit-related fees,” and “tax fees.”

provided services for the audits of our financial statements included in Annual Reports on Form 10-K and limited reviews of the

financial statements included in Quarterly Reports on Form 10-Q.

did not provide any professional services which would be considered “audit related fees.”

prepared our 2019 and 2018 Federal and state income tax returns.

provided by Weinberg with respect to the filing of various registration statements made throughout the year are considered “all

other fees.”

provided by Weinberg with respect to the filing of various registration statements made throughout the year are considered “all

Committee Pre-Approval Policies and Procedures

the SEC’s rules, the Audit Committee is required to pre-approve the audit and non-audit services performed by the independent

registered public accounting firm in order to ensure that they do not impair the auditors’

independence.

The SEC’s

the SEC’s rules, the Audit Committee is required to pre-approve the audit and non-audit services performed by the independent

registered public accounting firm in order to ensure that they do not impair the auditors’ independence.

rules specify the types of non-audit services that an independent auditor may not provide to its audit client and establish the

Audit Committee’s responsibility for administration of the engagement of the independent registered public accounting firm.

with the SEC’s rules, the Audit Committee Charter requires that the Audit Committee review and pre-approve all audit services

Audit Committee’s responsibility for administration of the engagement of the independent registered public accounting firm.

with the SEC’s rules, the Audit Committee Charter requires that the Audit Committee review and pre-approve all audit services

and permitted non-audit services provided by the independent registered public accounting firm to us or any of our subsidiaries.

3 unchanged sentences

services described in this Item 14 were pre-approved by the Audit Committee.

were no hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for

the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time,

were no hours expended on the principal accountant’s engagement to audit the registrant’s financial statements for

the most recent fiscal year that were attributed to work performed by persons other than the principal accountant’s full-time,

permanent employees.

10 unchanged sentences

Form 10K Summary

Company has elected not to provide summary information.

accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this Report to be signed on its behalf by the undersigned,

1 unchanged sentence

March 30, 2021

REED’S,

Delaware corporation

10 unchanged sentences

Imbrogno, Jr.

of Incorporation of Reed’s, Inc.

as filed September 7, 2001 (Incorporated by reference to Exhibit 3.1 to Reed’s,

Inc.’s Registration Statement on Form SB-2 (File No.

of Amendment of Certificate of Incorporation of Reed’s, Inc.

as filed September 27, 2004 (Incorporated by reference

to Exhibit 3.2 to Reed’s, Inc.’s Registration Statement on Form SB-2 (File No.

of Amendment of Certificate of Incorporation of Reed’s, Inc.

as filed December 18, 2007 (Incorporated by reference to

Exhibit 3.3 to Reed’s, Inc.’s Registration Statement on Form S-1 (File No.

of Designations, Preferences and Rights of Series A Preferred Stock of Reed’s, Inc.

as filed October 12, 2004 (Incorporated

by reference to Exhibit 3.3 to Reed’s, Inc.’s Registration Statement on Form SB-2 (File No.

of Correction to Certificate of Designations as filed November 10, 2004 (Incorporated by reference to Exhibit 3.4 to Reed’s,

Inc.’s Registration Statement on Form SB-2 (File No.

of Amendment of Certificate of Incorporation of Reed’s, Inc., as filed October 10, 2017 (Incorporated by reference to

Exhibit 3.6 to Reed’s, Inc.’s Registration Statement on Form S-1 (File No.

of Amendment of Certificate of Incorporation of Reed’s, Inc., as filed December

17, 2018 (Incorporated by reference to Exhibit 10.31 to Reed’s Inc.

Annual Report

on Form 10K for the year ended December 31, 2018, as filed April 1, 2019)

and Restated Bylaws of Reed’s Inc.

(Incorporated by reference to Exhibit 3.6 to Reed’s, Inc.’s Registration

Statement on Form S-1 (File No.

Certificate of Amendment of Certificate of Incorporation of Reed’s, Inc., as filed December 27, 2019, filed herewith.

of common stock certificate (Incorporated by reference to Exhibit 4.1 to Reed’s, Inc.’s Registration Statement

on Form SB-2 (File No.

of Series A preferred stock certificate (Incorporated by reference to Exhibit 4.2 to Reed’s, Inc.’s Registration

Statement on Form SB-2 (File No.

of Warrant issued to investors dated June 2, 2016 (Incorporated by reference to exhibit 4.1 to Reed’s Inc.’s Current

Report on Form 8-K as filed June 3, 2016)

Agent Warrant issued to Maxim Group LLC dated June 2, 2016 (Incorporated by reference to exhibit 4.2 to Reed’s Inc.’s

Current Report on Form 8-K as filed June 3, 2016)

of Common Stock Purchase Warrant issued November 9, 2015 (Incorporated by reference to exhibit 10.1 to Reed’s Inc.’s

Quarterly Report on Form 10Q for the period ended March 31, 2016, as filed May 11, 2016)

of Common Stock Purchase Warrant issued October 1, 2014 (Incorporated by reference to exhibit 10.4 to Reed’s Inc.’s

Quarterly Report on Form 10Q for the period ended March 31, 2016, as filed May 11, 2016)

of 2017-1 Warrant (Incorporated by reference to exhibit 4.1 to Reed’s Inc.’s Current Report on Form 8-K as filed

April 24, 2017)

of 2017-2 Warrant (Incorporated by reference to exhibit 4.2 to Reed’s Inc.’s Current Report on Form 8-K as filed

April 24, 2017)

of Subordinated Convertible Non-Redeemable Secured Promissory Note dated April 21, 2017 (Incorporated by reference to exhibit

4.3 to Reed’s Inc.’s Current Report on Form 8-K as filed April 24, 2017)

of 2017-3 Warrant (Incorporated by reference to Exhibit 4.1 to Current Report on Form 8-K, filed July 14, 2017)

of 2017-4 Warrant (Incorporated by reference to Exhibit 4.2 to Current Report on Form 8-K, filed July 14, 2017)

of Warrant Certificate issued in 2018 rights offering (Incorporated by reference to Exhibit 4.12 to Reed’s, Inc.’s

Registration Statement on Form S-1 (File No.

of Warrant Agreement (Incorporated by reference to Exhibit 3.6 to Reed’s, Inc.’s Registration Statement on Form

S-1 (File No.

of Warrant issuable to Raptor/ Harbor Reeds SPV, LLC pursuant to Backstop Agreement (Incorporated by reference to Exhibit

4.14 to Reed’s, Inc.’s Registration Statement on Form S-1 (File No.

Agent Agreement by and between Maxim Group LLC and Reed’s Inc.

dated May 26, 2016 (Incorporated by reference to exhibit

10.1 to Reed’s Inc.’s Current Report on Form 8-K as filed June 3, 2016)

Purchase Agreement by and between Reed’s Inc.

and purchasers signatory thereto dated May 26, 2016 (Incorporated by reference

to exhibit 10.2 to Reed’s Inc.’s Current Report on Form 8-K as filed June 3, 2016)

Rights Agreement by and between Reed’s Inc.

and purchasers signatory thereto dated May 26, 2016 (Incorporated by reference

to exhibit 10.3 to Reed’s Inc.’s Current Report on Form 8-K as filed June 3, 2016)

Stock Option Plan (Incorporated by reference to Exhibit 10.22 to Reed’s, Inc.’s Form 10-K filed March 27, 2009)

Incentive and Nonstatutory Stock Option Plan (Incorporated by reference to Exhibit 4.2 to Reed’s Inc.’s Registration

Statement on Form S-8 (File No.

333-203469), as filed April 17, 2015)

and Restated Loan and Security Agreement by and between Reed’s Inc.

and PMC Financial Services, LLC dated December 5,

2014 (Incorporated by reference to exhibit 10.3 to Reed’s Inc.’s Quarterly Report on Form 10Q for the period ended

March 31, 2016, as filed May 11, 2016)

Number One Standard Industrial Commercial Single Tenant Lease-Net by and between Reed’s Inc.

and 525 South Douglas Street,

LLC dated May 7, 2009 (Incorporated by reference to exhibit 10.4 to Reed’s Inc.’s Quarterly Report on Form 10Q

for the period ended March 31, 2016, as filed May 11, 2016)

Purchase Agreement by and between Reed’s Inc.

and Raptor/Harbor Reeds SPV LLC dated April 21, 2017 (Incorporated by

reference to exhibit 10.1 to Reed’s Inc.’s Current Report on Form 8-K as filed April 24, 2017)

Lien Security Agreement by and between Reed’s Inc.

and Raptor/Harbor Reeds SPV LLC dated April 21, 2017 (Incorporated

by reference to exhibit 10.2 to Reed’s Inc.’s Current Report on Form 8-K as filed April 24, 2017)

of Registration Rights Agreement by and between Reed’s Inc.

and Raptor/Harbor Reeds SPV LLC dated April 21, 2017 (Incorporated

by reference to exhibit 10.3 to Reed’s Inc.’s Current Report on Form 8-K as filed April 24, 2017)

Number Fifteen to Amended and Restated Loan and Security Agreement between Reed’s Inc.

and PMC Financial Services Group,

LLC dated April 21, 2017 (Incorporated by reference to exhibit 10.4 to Reed’s Inc.’s Current Report on Form 8-K

as filed April 24, 2017)

Exercise Agreement by and between Reed’s Inc.

and Raptor/Harbor Reeds SPV LLC dated July 13, 2017 (Incorporated by reference

to Exhibit 10.1 to Current Report on Form 8-K, filed July 14, 2017)

of Warrant Exercise Agreement by and between Reed’s Inc.

and three investors dated July 13, 2017 (Incorporated by reference

to Exhibit 10.2 to Current Report on Form 8-K, filed July 14, 2017)

Employment Agreement effective as of June 28, 2017 by and between Reed’s Inc.

and Valentin Stalowir (Incorporated by

reference to Exhibit 10.1 to Current Report on Form 8-K, filed July 13, 2017)

Incentive Compensation Plan (Incorporated by reference to Exhibit 4.2 to Reed’s, Inc.’s Registration Statement

on Form S-8 (File No.

of Backstop Agreement by and between Reed’s Inc.

and Raptor/ Harbor Reeds SPV, LLC(Incorporated by reference to Exhibit

10.16 to Reed’s, Inc.’s Registration Statement on Form S-1 (File No.

Employment Agreement by and between Reed’s Inc.

and Stefan Freeman dated October 4, 2017 (Incorporated by reference

to Exhibit 10.1 to Form 8-K dated September 29, 2019)

Agreement by and between Reed’s Inc.

Certificate of Incorporation of Reed’s Inc., as amended

Amended and Restated Bylaws of Reed’s, Inc.

Form of common stock certificate

Form of series A preferred stock certificate

Form of common stock purchase warrant issued to investors on June 2, 2016

Form of common stock purchase warrant issued to Maxim Group LLC on June 2, 2016

Form of common stock purchase warrant issued to PMC Financial Services Group, LLC on November 9, 2015

Form of 2017-1 common stock purchase warrant

Form of 2017-2 common stock purchase warrant

Form of 2017-3 common stock purchase warrant

Form of 2017-4 common stock purchase warrant

Form of common stock purchase Warrant issued to Raptor/ Harbor Reed’s SPV on December 11, 2020

Description of registrant’s common stock

Satisfaction Settlement and Release Agreement by and between Reed’s, Inc.

and Raptor/ Harbor Reeds SPV, dated December 11, 2020

Rights Agreement by and between Reed’s, Inc.

and Raptor/ Harbor Reeds SPV, dated December 11, 2020

dated March 11, 2021 to Financing Agreement dated October 4, 2018 by and between Reed’s Inc.

and Rosenthal & Rosenthal,

Registration Rights Agreement by and between Reed’s Inc.

and purchasers signatory thereto dated May 26, 2016

Form of Registration Rights Agreement by and between Reed’s Inc.

and Raptor/Harbor Reeds SPV LLC dated April 21, 2017

2017 Incentive Compensation Plan

2020 Equity Incentive Plan

Amendment dated December 23, 2020 to Financing Agreement dated October 4, 2018 between Reed’s, Inc.

and Rosenthal & Rosenthal, Inc.

dated October 4, 2018 (Incorporated by reference

to Exhibit 10.1 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September 30, 2018, as filed November

Security Agreement by and between Reed’s Inc.

Inventory Security Agreement by and between Reed’s Inc.

and Rosenthal & Rosenthal Inc.

dated October 4, 2018 (Incorporated

by reference to Exhibit 10.2 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September 30, 2018, as

filed November 14, 2018)

Property Security Agreement by and between Reed’s Inc.

dated October 4, 2018

Intellectual Property Security Agreement by and between Reed’s, Inc.

and Rosenthal & Rosenthal Inc.

dated October 4, 2018 (Incorporated

by reference to Exhibit 10.3 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September 30, 2018, as

filed November 14, 2018)

Interest (short form) by Reed’s Inc.

dated October 4, 2018

Security Interest (short form) by Reed’s, Inc.

in favor of Rosenthal & Rosenthal Inc.

dated October 4, 2018 (Incorporated

by reference to Exhibit 10.4 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September 30, 2018, as

filed November 14, 2018)

Subordination

Agreement by and among Rosenthal & Rosenthal Inc., Raptor/Harbor Reeds SPV LLC and Reed’s Inc.

dated October 4, 2018

2018 (Incorporated by reference to Exhibit 10.5 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September

30, 2018, as filed November 14, 2018)

Amendment to Securities Purchase Agreement and Transaction Documents by and between Raptor/Harbor Reeds SPV LLC and Reed’s

dated October 4, 2018 (Incorporated by reference to Exhibit 10.6 to Reed’s Inc.

Quarterly Report on Form 10Q for

the period ended September 30, 2018, as filed November 14, 2018)

Agreement by and between Reed’s Inc., Merritt 7 Venture L.L.C., and GE Capital US Holdings, Inc., dated September 1,

2018 (Incorporated by reference to Exhibit 10.7 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September

30, 2018, as filed November 14, 2018)

Settlement and Release of Claims Agreement by and between Reed’s Inc.

and Daniel V.

Miles dated August 15, 2018 (Incorporated

by reference to Exhibit 10.8 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September 30, 2018, as

filed November 14, 2018)

to Transaction Documents dated December 18, 2018 by and between Reed’s Inc.

and Raptor Harbor Reed’s SPV LLC,

previously filed with this registration statement on Form S-3.

Purchase Agreement by and between Reed’s Inc.

and California Custom Beverage LLC dated December 31, 2018 (Incorporated

by reference to Exhibit 10.1 to Current Report on Form 8-K, as amended, dated December 31, 2018)

and Assumption of Lease and Consent of Lessor by and between Reed’s Inc.

Agreement by and between Rosenthal & Rosenthal Inc.

and Raptor/Harbor Reeds SPV LLC dated October 4, 2018

Sublease Agreement by and between Reed’s, Inc., Merritt 7 Venture L.L.C., and GE Capital US Holdings, Inc., dated September 1, 2018

Asset Purchase Agreement by and between Reed’s, Inc.

and California Custom Beverage LLC dated December 31, 2018

(Incorporated by reference to Exhibit 10.2 to Current Report on Form 8-K, as amended, dated December 31, 2018)

Services Agreement by and between Reed’s Inc.

Assignment and Assumption of Lease and Consent of Lessor by and between Reed’s, Inc.

and California Custom Beverage LLC dated December 31, 2018

(Incorporated

by reference to Exhibit 10.3 to Current Report on Form 8-K, as amended, dated December 31, 2018)

Agreement by and between Reed’s Inc.

and California Custom Beverage LLC dated December 31, 2018 (Incorporated by reference

to Exhibit 10.4 to Current Report on Form 8-K, as amended, dated December 31, 2018)

of Indemnification Agreement by and between the Company and officers and directors, (Incorporated by reference to Exhibit

10.31 to Reed’s Inc.

Annual Report on Form 10K for the year ended December 31, 2018, as filed April 1, 2019)

1 to Employment Agreement by and between Reed’s Inc.

and Valentin Stalowir dated September 29, 2019 (Incorporated

by reference to Exhibit 10.3 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September 30, 2019, as

filed November 13, 2019)

Agreement by and between Reed’s Inc.

and Norman Snyder dated September 30, 2019 (Incorporated by reference to Exhibit

10.2 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September 30, 2019, as filed November 13, 2019)

Manufacturing

and Distribution Agreement by and between Reed’s Inc.

and B C Marketing Concepts Inc., dba Full Sail Brewing Company

dated October 11, 2019 (Incorporated by reference to Exhibit 10.3 to Reed’s Inc.

Quarterly Report on Form 10Q for the

period ended September 30, 2019, as filed November 13, 2019)

Development Agreement Reed’s Inc.

and B C Marketing Concepts Inc., dba Full Sail Brewing Company dated October 11, 2019

(Incorporated by reference to Exhibit 10.4 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September

30, 2019, as filed November 13, 2019)

Settlement and Release of Claims Agreement between Reed’s Inc.

and Valentin Stalowir dated October 31, 2019 (Incorporated

by reference to Exhibit 10.5 to Reed’s Inc.

Quarterly Report on Form 10Q for the period ended September 30, 2019, as

filed November 13, 2019)

Separation, Settlement and Release of Claims Agreement by and between Reed’s Inc.

and Stefan Freeman dated November 22, 2019 filed herewith.

Executive Employment Agreement by and between Reed’s Inc.

Transition Services Agreement by and between Reed’s, Inc.

and California Custom Beverage LLC dated December 31, 2018

Referral Agreement by and between Reed’s Inc.

and California Custom Beverage LLC dated December 31, 2018

Form of Indemnification Agreement by and between Reed’s, Inc.

and officers and directors

Executive Employment Agreement by and between Reed’s Inc.

and Thomas J.

Spisak dated December 2, 2019 filed herewith.

of Ethics (Incorporated by reference to Exhibit 14.1 to Reed’s, Inc.’s Registration Statement on Form SB-2 (File

Subsidiaries of Reed’s, Inc., filed herewith.

Consent of Weinberg & Co., P.A., filed herewith.

Spisak dated December 2, 2019

Form of Non-Employee Director Nonstatutory Stock Option Agreement

Form of Executive Incentive Stock Option Agreement

Amended and Restated Employment Agreement by and between Reed’s Inc.

and Norman E.

dated June 24, 2020

Form of Reed’s, Inc.

Promissory Note, in the principal amount of $769,816 in favor of City National Bank, dated April 20, 2020.

Manufacturing and Distribution Agreement by and between Reed’s, Inc.

and B C Marketing Concepts Inc., dba Full Sail Brewing Company dated October 11, 2019

Recipe Development Agreement Reed’s, Inc.

and B C Marketing Concepts Inc., dba Full Sail Brewing Company dated October 11, 2019

Financing Agreement by and between Reed’s Inc.

and Rosenthal & Rosenthal Inc.

dated October 4, 2018

Code of Ethics

Subsidiaries of Reed’s, Inc.

Affiliate Guarantor

Consent of Weinberg & Co., PA

Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, filed herewith.

7 unchanged sentences

Taxonomy Extension Calculation Linkbase Document

Taxonomy Extension Definition Linkbase Document

Taxonomy Extension Label Linkbase Document

Taxonomy Extension Presentation Linkbase Document

a management contract or compensatory plan or arrangement.

accordance with SEC Release 33-8238, Exhibit 32.1 and 32.2 are being furnished and not

(Extensible Business Reporting Language) information is furnished and not filed or a part of a registration statement

or prospectus for purposes of Sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes

of Section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these

Taxonomy Extension Label Linkbase Document

Indicates a management contract or compensatory plan or arrangement.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 9A. Controls and Procedures