SecProbe.io

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Mail Stop 0308 							December 10,
2004

VIA U.S. MAIL AND FACSIMILE

Christopher J. Reed
President, CEO, CFO, and Chairman
Reed`s, Inc.
13000 South Spring Street
Los Angeles, California 90061

Re:	Reed`s, Inc.
      Registration Statement on Form SB-2
      File No. 333-120451
      Filed November 12, 2004

Dear Mr. Reed:

      We have reviewed your filing and have the following
comments.
Where indicated, we think you should revise your document in
response
to these comments.  If you disagree, we will consider your
explanation as to why our comment is inapplicable or a revision is
unnecessary.  Please be as detailed as necessary in your
explanation.
In some of our comments, we may ask you to provide us with
supplemental information so we may better understand your
disclosure.
After reviewing this information, we may or may not raise
additional
comments.

      Please understand that the purpose of our review process is
to
assist you in your compliance with the applicable disclosure
requirements and to enhance the overall disclosure in your filing.
We look forward to working with you in these respects.  We welcome
any questions you may have about our comments or on any other
aspect
of our review.  Feel free to call us at the telephone numbers
listed
at the end of this letter.
1. Please tell us what consideration you have given to naming Mr.
Sharma as an "underwriter" within the meaning the federal
securities
laws.  As such, he appears to be engaged in the distribution of
shares in this offering.  We note in this regard that he is both
one
of your directors and a registered broker-dealer affiliated with
your
selling agent, Brookstreet.  In fact, we note that Mr. Sharma will
receive a substantial amount of the commissions and fees you will
pay
to Brookstreet as part of this offering.  If Mr. Sharma is an
underwriter, then he must be named as such on the prospectus cover
page, in the Plan of Distribution, and elsewhere as appropriate.

2. We note a number of blank spaces throughout your registration
statement for information that you are not entitled to omit under
Rule 430A, such as the anticipated price range.  Please note that
we
may have additional comments once you have provided this
disclosure.
Therefore, please allow us sufficient time to review your complete
disclosure prior to any distribution of preliminary prospectuses.

In this regard, we note you have assumed an offering price of
$4.00
per share in certain sections such as the Use of Proceeds and
Dilution sections.  Other sections such as the Capitalization as
of
June 30, 2004 were not fully updated to consider an offering price
of
$4.00.
3. We note that you have not filed a number of key exhibits,
including the selling agent agreement, various loan agreements,
and
the legality opinion.  Please file these exhibits with your next
amendment, as we will need time to adequately review them.  We
also
may have further comment with respect to prospectus disclosure
after
reviewing the exhibits.
Registration Statement Cover Page
4. Add a sentence and a checked box indicating that the securities
are being offered on a delayed or continuous basis pursuant to
Rule
415.  See, for example, interpretation D.36 of the Manual of
Publicly
Available Telephone Interpretations (July 1997) and Form S-1 to
review the disclosure that you should include.

Prospectus Cover Page
5. Please revise the second full paragraph to divide it into two
paragraphs:  one addressing the offering itself and the other
addressing the lack of a market for your shares.  The latter
paragraph also should highlight that, due to the lack of trading
market, purchasers in this offering are receiving an illiquid
security.
6. Your use of fully justified margins impedes readability.
Please
revise throughout to use only a left-justified margin.

Table of Contents
7. On the outside back cover page of the prospectus, advise
dealers
of their prospectus delivery obligation, pursuant to Item 502(b)
of
Regulation S-B.
Prospectus Summary, page 1
8. Since your summary must provide a brief, but not incomplete,
overview of the key aspects of the offering, delete the statement
that the "summary is not complete."  If necessary, provide
additional
material information in a concise manner to make the summary
complete.
9. We remind you that a summary should provide a brief overview of
you in a balanced manner.  In this regard, please add disclosure
about the following in your core summary:

* Disclose that you have significant net losses, and state the
amount
for the most recent audited and interim periods.  Also, disclose
if
accurate that you have an expectation of continued significant
losses
and inadequate cash from operations to cover operating and net
losses.

* State the percentage of your common stock being offered in this
prospectus.  Also indicate that the Reed family will hold __% of
your
shares, and as a result will exercise control over your direction.

* Explain that your shares currently are not traded on any market
or
exchange, and briefly explain how this impacts share liquidity.
Briefly explain what is required to list your shares on an
exchange
or become quoted on a market.

* State the percentage of your total sales revenues you derive
from
your products being sold at supermarkets and also at specialty
stores.

      These are only examples.  Revise accordingly.
10. Further, in the core summary, please briefly describe the type
of
offering you are conducting, and describe how the amount of
proceeds
raised will impact your ability to operate going forward.
Risk Factors
11. Avoid risk factors that could apply to any company.  Generic
risk
factors do not represent meaningful disclosure.  Examples include:

* "We face risks associated with product liability claims...,"
page
4.  If you have a history of product recall, state the reason for
the
recall and the amount of resultant financial loss to you.
Moreover,
represent whether you carry commercially reasonable amount of
insurance coverage to insulate yourself from product liability
claims.  However, you do not need to disclose the dollar amount of
the insurance coverage you carry.  Finally, state here that you do
not maintain product recall insurance, as you disclose on page 22.

* "We need to manage our growth...," page 5.  Specify the nature
of
"significant strain" put upon your company by the growth you have
experienced.

* "Our ability to obtain needed additional financing...," page 6.
Quantify your known short-term and long-term capital requirements
and
disclose the time when you anticipate you will need the additional
capital.

If you elect to retain these and other generic risk factors in
your
prospectus, you must clearly explain how they apply to your
company,
industry, offering, etc.  Please revise accordingly throughout.

12. Some of your risk factors are unduly vague.  Please revise to
include sufficient, specific information to assess the risk.
Examples include:
* "The loss of our third-party suppliers or service providers...,"
page 4; and "The loss of our third-party distributors...," page 4.
Tell us supplementally whether you have lost or foresee losing
third-
party suppliers, service providers, or distributors, or have
experienced problems in business relationship with them.  If so,
disclose the fact in the discussion under the following two risk
factor captions.

* "Increases in the cost of packaging for our products...," page
4.
State the percentage of the total expenses on manufacturing that
is
spent on packaging your products.  If your cost of packaging has
increased substantially in the recent years, provide quantitative
information on this trend.

* "There is not yet a public trading market for our
securities...,"
page 5.  Please revise to more clearly articulate what you or
market
makers must do to create a trading market for your securities, and
how long that process may take.
These are only examples.  As a general matter, you should express
your risk factors in more concrete terms with adequate, but not
excessive, non-generic detail so that readers are able to clearly
identify and assess the magnitude of the risk.  Do not assume that
investors will be able to decipher the risk.
Forward-Looking Statements, page 8
13. The safe harbor provided by the Private Securities Litigation
Reform Act of 1995 for forward-looking statements is not available
for an initial registration statement.  In addition, such a safe
harbor in not available for an initial public offering, pursuant
to
Section 27A(b)(2)(D) of the Securities Act and Section
21E(b)(2)(D)
of the Exchange Act.  Delete references to Section 27A of the
Securities Act, Section 21E of the Exchange Act, and the Private
Securities Litigation Reform Act of 1995 here and on page 14.
14. In the last paragraph on page 9 you state that you are not
responsible for the accuracy and completeness of any forward-
looking
statements.  We remind you that are responsible for the accuracy
and
completeness of all contents of the registration statement.
Revise.

Capitalization as of June 30, 2004, page 12
15. Please revise your "As adjusted" disclosure to reflect the
10%,
50% and 100% scenarios presented throughout your filing.
16. Please delete the line-item "Other liabilities" from the
table.
Only capitalization in the form of debt and equity should be
included.

Dilution, page 13
17. With respect to the two issuances of Series A Convertible
Preferred Stock in October 2004 tell us what consideration was
given
to recognition of a beneficial conversion feature (BCF) under EITF
98-5.  In this regard we note that the Series A Convertible
Preferred
Stock entitles the holder to convert into 4 shares of common
stock.
Based on a sale price of $10 per preferred share, the cost of each
common share is $2.50.  Based on the proposed offering price per
common share of $4.00, it appears that the two transactions
resulted
in an intrinsic BCF of $1.50 per common share ($6.00 per Series A
Convertible Preferred share). Please advise.
Management`s Discussion and Analysis

Overview, page 14
18. We note that you discuss certain trends and uncertainties that
may affect your business or operations, factors such as the rise
in
freight costs and increase in demand for low-carbohydrate foods.
Expand this section to discuss any other known material trends and
uncertainties that will have or are reasonably likely to have a
material impact on your revenues or income or result in your
liquidity decreasing or increasing in any material way.  For
example,
if relevant, you may discuss the evolving trends in the nature of
your competition and the consumer demands in the geographical
markets
where you compete, developments in the supermarket and health food
store retail sales trends, any increased costs in the packaging
and
advertising for a consumer products manufacturer like you, and so
on.
In doing so, provide additional information about the quality and
variability of your earnings and cash flows so that investors can
ascertain the likelihood of the extent past performance is
indicative
of future performance.  In addition, discuss in reasonable detail:
* economic or industry-wide factors relevant to your company, and
* material opportunities, challenges and risks in short and long
term
and the actions you are taking to address them.
  	Please refer to SEC Release No. 33-8350.
19. State whether the Brewery has reduced production costs and
freight costs associated with your West Coast sales since 2002,
and
provide relevant quantitative disclosure.

Critical Accounting Policies, page 15
20. You state that you evaluate your non-amortizing trademark
license
and trademarks annually for impairment and "the fair value is
calculated by reviewing net sales of the various beverages and
applying industry multiples."  Please tell us the multiples you
apply
and how you determined that those multiples were representative of
multiples used by marketplace participants.

Results of Operations, page 18
21. Discuss whether you expect revenues, operating expenses, etc.
to
increase, decrease, or remain constant, and explain why.
Similarly,
identify and discuss any industry trends or uncertainties that
will
impact your revenues, costs, etc.
22. Delete the discussion of 2002 versus 2001 results of
operations
or include an audited 2001 statement of operations.
23. Where you describe two or more business reasons that
contributed
to a material change in a financial statement line item between
periods, please quantify the extent to which each change
contributed
to the overall change in that line item, if practical.  For
example,
you provide a list of the contributing factors for the decrease in
gross margin through the first six months of 2004 but you do not
quantify the extent to which each factor impacted gross margin.
Also, you provide a list of contributing and offsetting factors
along
with percentage changes for the increase in general and
administrative expenses when comparing the year ended December 31,
2003 to the year ended December 31, 2002 however in the absence of
quantification of the dollar amounts of the expenses to which you
refer, the disclosure of percentage changes in individual cost
items
is not meaningful.  See Item 303(b) of Regulation S-B.

Liquidity and Capital Resources, page 19
24. You identify increases in receivables and inventory, offset by
an
increase in accounts payable as the primary drivers of the use of
operating cash flow.   Please expand your discussion to address
the
specific business reasons why these amounts fluctuated.  In this
regard it would be helpful to disclose the company`s days sales
outstanding, inventory turnover, or other metrics used by
management
to evaluate working capital.  Such disclosure should be
accompanied
by an explanation and analysis of any material trends indicated by
the data.  Also, you attribute the increase in receivables to the
increase in sales; however, the increase in receivables far
outpaced
the sales change on a percentage basis.  Please revise to explain.
25. Disclose the current status of your negotiations with the debt
holders of 2001 regarding the extension of the maturity date of
the
loan.  In addition, file the original and any subsequently revised
version of the loan agreement as exhibits.

Business

Founder`s Statement, page 23
26. Revise to limit the statement to salient aspects of the
offering
or your business.  Also, provide a balanced presentation of your
operations in your letter by including risks and weaknesses in
your
business and this offering.  The following is a partial list of
examples of revisions you need to make:

* Delete statements about doing "something that would be
beneficial
to the planet" and having "a deep respect for Mother Nature`s
remedies" since these statements do not add qualitatively to the
disclosure in the filing;

* Delete any unprovable statement such as many consumers of your
products buy them "for their range of benefits" because ginger has
"healing properties;"

* Provide us third-party annotated documentary evidence
substantiating your claim that your ginger ale recipe is from the
"log cabin days."

Recent Developments, page 24
27. We note the caption of this sub-section.  Please be advised
that
in disclosure documents "Recent Developments" typically denotes
events that have occurred since the most recent audited or interim
financial statements.  Change the caption to reflect that you
discuss
the history and background of your company in this sub-section.
28. Explain clearly what you mean by Reed`s Ginger Brews reaching
over 90% "placement" in natural food stores nationwide.  If, by
that
statement, you mean that 90% of the natural food stores in this
country carry your products, provide us the evidentiary basis of
your
claim.  In addition, state your current "placement" percentage.
Industry Overview, page 25
29. Provide us annotated copies of the relevant