SEC Company Response from REED'S, INC. (REED) (CIK 0001140215) (REED) — May 4, 2009
REED'S, INC. (REED) (CIK 0001140215)
Date: May 4, 2009 · CIK: 0001140215 · Accession: 0001019687-09-001584
AI Filing Summary & Sentiment
Reasoning
File numbers found in text: 333-156908
Referenced dates: February 22, 2009
Letter
Securities and Exchange Commission Division of Corporation Finance Office of Beverages, Apparel and Healthcare Services Reed’s, Inc. Registration Statement on Form S-1 File No. 333-156908 Filed January 23, 2009
Dear Mr. Reynolds:
On behalf of Reed’s, Inc. (the “Company” or “Reed’s”), set forth below are the Company’s responses to the comments received from the staff (“Staff”) of the Securities and Exchange Commission in the letter dated February 22, 2009. We have reproduced the Staff’s comments in bold type for your convenience and have followed the comment with the Company’s response. References in this letter to “we”, “our”, or “us” mean the Company or its advisors, as the context may require.
General
1. We note that your registration statement appears to be incomplete with many blank spaces and missing terms as they become known. We may have further comment.
Response: We acknowledge that you may have further comment until the registration statement is complete.
2. Please clarify when the board will set the subscription price and the duration of the exercise period for the stock rights.
Mr. John Reynolds
Securities and Exchange Commission
May 4,
Page 2 of
Response: The subscription price has been set at $10.00 per share of Series B Preferred. The duration of the exercise period shall be set prior to effectiveness of the Registration Statement on Form S-3.
3. Please revise to indicate the maximum number of rights that can be exercised under this stock rights offering. It appears that the maximum is 4,444,444 shares of common stock, which is $10,000,000 divided by the minimum allowable exercise price of $2.25 per share. If true, please revise your cover page and other appropriate areas of your registration statement to include this figure, along with the number of shares outstanding that are eligible to receive stock rights to purchase one share of common stock.
Response: We have revised our disclosure to incorporate this information with regards to the new offering terms.
4. Since there are approximately 9 million shares of common stock outstanding of your stock, please clarify in the appropriate places in your registration statement how the shares underlying the stock rights will be allocated if more than 4,444,444 shares are exercised in the basic subscription right prior to the over-subscription pro rata scheme described on page 87. Similarly, please clarify how Maxim’s warrant affects exercise of the stock rights if either the basic subscription or over-subscription rights are oversubscribed by shareholders of the stock rights in this offering.
Response: The terms of the offering have been revised. As such, the basic subscription rights may no longer be over-susbcribed and Maxim is no longer involved in this offering.
5. We note your disclosure in a number of instances that “unless our board of directors waives the maximum offering amount, we will raise no more than $10,000,000 in this offering.” We note that you have registered a maximum of $10,000,000 of securities pursuant to this registration statement. Supplementally advise how the company plans on raising more than $10,000,000 in the offering given the amount of securities registered on its Form S-1. We may have further comment.
Response: The terms of the offering have been revised. We are registering150,000 shares of Series B Preferred at an offering price of $10.00 per share. The maximum offering amount is $1,500,000. We will not raise more than $1,500,000 in this offering.
6. Please clarify whether the board of directors may extend the stock rights offering beyond 20 days of the original expiration date and under what circumstances it may do so.
Response: The Board of Directors may extend the rights offering if the offering is undersubscribed, at their sole discretion. We have revised our disclosure accordingly.
Mr. John Reynolds
Securities and Exchange Commission
May 4,
Page 3 of
7. On page 86, you indicate that the subscription rights will not be listed for trading on any stock exchange or market. We note, however, on the cover page, page 3, and page 12 seem to indicate that the rights are transferable and will be listed. Please revise to clarify or remove this inconsistency.
Response: Due to the revised terms of the offering, the rights are no longer transferable. We have revised our disclosures for consistency accordingly.
8. We note your statement that the stock rights will be listed on the NASDAQ Capital Market, please advise us whether they have been approved for listing by Nasdaq and/or whether you plan on filing a Form 8-A.
Response: Due to revised offering terms, the rights will not be listed on NASDAQ. We have revised our disclosures accordingly.
9. We note that as of today your common stock price is $1.13 per share, substantially below the minimum exercise price of $2.25 per share. We also note your disclosure that the price per share will not be less than $2.25 unless waived by our board of directors. Please advise us how this will impact your offering or the timing of your offering.
Response: We have revised the offering to provide for the sale of Series B Preferred in lieu of common stock.
Cover Page
10. Please clarify here and other appropriate places in the registration statement that in order to receive any over-subscription rights, the shareholder must: 1) exercise their entire allotment of basic subscription rights; 2) that the exercise price for both the basic and over-subscription rights is the same amount; and 3) that the over-subscription rights must be exercised at the same time as the basic subscription rights.
Response: We have revised our disclosure accordingly.
Reed’s, Inc. Condensed Balance Sheets, F-1
11. Please revise to include an audited balance sheet for the fiscal year ended December 31, 2006 in accordance with Rule 8-02 of Regulation S-X.
Response: No longer applicable.
Mr. John Reynolds
Securities and Exchange Commission
May 4,
Page 4 of
Exhibits, page II-4
12. We note the Form of Dealer-Manager Agreement by and between Reed’s, Inc. and Maxim Group LLC and other exhibits have yet to be filed. We require sufficient time to review these documents prior to your request for acceleration and may have further comment. Please file all missing exhibits with your next amendment.
Response: We will file all missing exhibits with our next amendment.
* * * * * * *
We hope that the information contained in this letter satisfactorily addresses the comments by the Staff. Please do not hesitate to contact Ruba Qashu, Esq. by telephone at (949) 355-5405 or by facsimile at (949) 759-7533.
Sincerely,
REED’S,
INC.
Show Raw Text
CORRESP
1
filename1.htm
reeds_corresp-050109.htm
REED’S,
INC.
13000
South Spring Street
Los
Angeles, California 90061
(310) 217-9400
May 4,
2009
VIA
FEDERAL EXPRESS
Securities
and Exchange Commission
Division
of Corporation Finance
100 F.
Street, N.E.
Washington,
D.C. 20549-6010
Attn:
John
Reynolds
Assistant
Director
Office
of Beverages, Apparel and Healthcare
Services
Re:
Reed’s, Inc.
Registration
Statement on Form S-1
File
No. 333-156908
Filed
January 23, 2009
Dear Mr.
Reynolds:
On behalf
of Reed’s, Inc. (the “Company” or “Reed’s”), set forth below are the
Company’s responses to the comments received from the staff (“Staff”) of the
Securities and Exchange Commission in the letter dated February 22,
2009. We have reproduced the Staff’s comments in bold type for your
convenience and have followed the comment with the Company’s
response. References in this letter to “we”, “our”, or “us” mean the
Company or its advisors, as the context may require.
General
1. We
note that your registration statement appears to be incomplete with many blank
spaces and missing terms as they become known. We may have further
comment.
Response: We
acknowledge that you may have further comment until the registration statement
is complete.
2. Please
clarify when the board will set the subscription price and the duration of the
exercise period for the stock rights.
Mr. John
Reynolds
Securities
and Exchange Commission
May 4,
2009
Page 2 of
4
Response: The
subscription price has been set at $10.00 per share of Series B
Preferred. The duration of the exercise period shall be set prior to
effectiveness of the Registration Statement on Form S-3.
3. Please
revise to indicate the maximum number of rights that can be exercised under this
stock rights offering. It appears that the maximum is 4,444,444
shares of common stock, which is $10,000,000 divided by the minimum allowable
exercise price of $2.25 per share. If true, please revise your cover
page and other appropriate areas of your registration statement to include this
figure, along with the number of shares outstanding that are eligible to receive
stock rights to purchase one share of common stock.
Response: We have revised our
disclosure to incorporate this information with regards to the new offering
terms.
4. Since
there are approximately 9 million shares of common stock outstanding of your
stock, please clarify in the appropriate places in your registration statement
how the shares underlying the stock rights will be allocated if more than
4,444,444 shares are exercised in the basic subscription right prior to the
over-subscription pro rata scheme described on page 87. Similarly,
please clarify how Maxim’s warrant affects exercise of the stock rights if
either the basic subscription or over-subscription rights are oversubscribed by
shareholders of the stock rights in this offering.
Response: The
terms of the offering have been revised. As such, the basic
subscription rights may no longer be over-susbcribed and Maxim is no longer
involved in this offering.
5. We
note your disclosure in a number of instances that “unless our board of
directors waives the maximum offering amount, we will raise no more than
$10,000,000 in this offering.” We note that you have registered a
maximum of $10,000,000 of securities pursuant to this registration
statement. Supplementally advise how the company plans on raising
more than $10,000,000 in the offering given the amount of securities registered
on its Form S-1. We may have further comment.
Response: The
terms of the offering have been revised. We are registering150,000
shares of Series B Preferred at an offering price of $10.00 per
share. The maximum offering amount is $1,500,000. We will not raise
more than $1,500,000 in this offering.
6. Please
clarify whether the board of directors may extend the stock rights offering
beyond 20 days of the original expiration date and under what circumstances it
may do so.
Response: The
Board of Directors may extend the rights offering if the offering is
undersubscribed, at their sole discretion. We have revised our disclosure
accordingly.
2
Mr. John
Reynolds
Securities
and Exchange Commission
May 4,
2009
Page 3 of
4
7. On page 86, you indicate that the
subscription rights will not be listed for trading on any stock exchange or
market. We note, however, on the cover page, page 3, and page 12 seem
to indicate that the rights are transferable and will be
listed. Please revise to clarify or remove this inconsistency.
Response: Due to
the revised terms of the offering, the rights are no longer
transferable. We have revised our disclosures for consistency
accordingly.
8. We
note your statement that the stock rights will be listed on the NASDAQ Capital
Market, please advise us whether they have been approved for listing by Nasdaq
and/or whether you plan on filing a Form 8-A.
Response: Due to revised
offering terms, the rights will not be listed on NASDAQ. We have revised our
disclosures accordingly.
9. We
note that as of today your common stock price is $1.13 per share, substantially
below the minimum exercise price of $2.25 per share. We also note
your disclosure that the price per share will not be less than $2.25 unless
waived by our board of directors. Please advise us how this will
impact your offering or the timing of your offering.
Response: We have
revised the offering to provide for the sale of Series B Preferred in lieu of
common stock.
Cover
Page
10. Please
clarify here and other appropriate places in the registration statement that in
order to receive any over-subscription rights, the shareholder must: 1) exercise
their entire allotment of basic subscription rights; 2) that the exercise price
for both the basic and over-subscription rights is the same amount; and 3) that
the over-subscription rights must be exercised at the same time as the basic
subscription rights.
Response: We have
revised our disclosure accordingly.
Reed’s, Inc. Condensed
Balance Sheets, F-1
11. Please
revise to include an audited balance sheet for the fiscal year ended December
31, 2006 in accordance with Rule 8-02 of Regulation S-X.
Response: No
longer applicable.
3
Mr. John
Reynolds
Securities
and Exchange Commission
May 4,
2009
Page 4 of
4
Exhibits, page
II-4
12.
We note the Form of Dealer-Manager Agreement by and between Reed’s, Inc. and
Maxim Group LLC and other exhibits have yet to be filed. We require
sufficient time to review these documents prior to your request for acceleration
and may have further comment. Please file all missing exhibits with
your next amendment.
Response: We will
file all missing exhibits with our next amendment.
* * * * *
* *
We hope
that the information contained in this letter satisfactorily addresses the
comments by the Staff. Please do not hesitate to contact Ruba Qashu,
Esq. by telephone at (949) 355-5405 or by facsimile at (949)
759-7533.
Sincerely,
REED’S,
INC.
/s/ Christopher J. Reed
Christopher
J. Reed
Chief
Executive Officer
4