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CORRESP
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    reeds_corresp-062309.htm

    REED’S,
INC.

    13000
South Spring Street

    Los
Angeles, California 90061

    (310) 217-9400

    June 23,
2009

    John
Reynolds

    Assistant
Director

    Office of
Beverages, Apparel and Healthcare Services

    United
States Securities and Exchange Commission

    Division
of Corporate Finance

            RE:
            Reed’s
      Inc.

            Registration
      Statement on Form S-3/A

            File No.
      333-156908

            Filed May 4,
      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 May 28,
2009.  We previously filed responses to  comments 7-9
concerning the Company’s annual report on Form 10K for the fiscal year ended
December 31, 2008, filed March 27, 2009 ( “2008 10K”).  We have
included responses to the Staff’s follow up comments with regards to the 2008
10K  which were included with the SEC’s letter dated June 5, 2009
concerning the Company’s shelf registration on Form S-3 (File No. 333-159298)
(June 5, 2009 Letter”). 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
reissue comment one of our letter dated February 22, 2009, as it appears your
registration statement remains incomplete with many blank spaces and missing
terms as to your subscription rights offering. Please revise to include the
missing terms as they become known.  Please be advised that we may
have additional comments given the amount of missing information.

    Response:
We have revised our registration statement to include missing terms that have
become known and will continue to do so.

    2.      Please
revise to provide the missing information to comply with Instruction 7 of Form
S-3 regarding I.B.6.

    Response:  We
have revised to include the missing information to comply with Instruction 7 of
Form S-3 regarding I.B.6.

    3.      Please
revise your registration statement in the appropriate places to clearly disclose
whether the shares of common stock underlying your Series B Convertible
Preferred Stock are unregistered securities and the consequences of their lack
of registration.  Also, please revise to include an appropriate
discussion of the dilutive effects caused upon conversion of the Series B
Convertible Preferred Stock.  We may have further
comment.

    Response:  The
shares of common stock underlying our Series B Convertible Preferred Stock are
being registered hereunder.  We have revised our registration
statement to include appropriate discussion of the dilutive effects caused upon
conversion of the Series B Convertible Preferred Stock as well.

    4.      Please
advise us of the basis for your belief that this offering is eligible to be
registered on Form S-3.  We may have further comment.

    Response:  Reed’s
satisfies the general requirements of eligibility to register securities under
Instruction I.A of Form S-3.  With regards to transactional
requirements, while Instruction I.B.4 provides for registration of rights
offerings, this offering is a rights offering to be followed by a public
offering and may be registered under Instruction I.B.6. of Form S-3 as a limited
primary offering.  Reed’s satisfies the requirements of Instruction
I.B.6 as follows:  (i) The aggregate market value of securities sold
by or on behalf of Reed’s pursuant to Instruction I.B.6. during the period of 12
calendar months immediately prior to, and including, the sale will be no more
than one-third of the aggregate market value of the voting and non-voting common
equity held by non-affiliates of the registrant; (ii)  Reed’s is not a
shell company and has not been a shell company for at least 12 calendar months
previously and (iii)  Reed’s common stock is listed and registered on
the NASDAQ Capital Market.

    Capitalization

    5.      Your
presentation of the “pro forma as adjusted” column is
inappropriate.  See Rule 170 of the Securities Act of
1933.

    Response:  We
have removed the “pro forma as adjusted” column in accordance with Rule
170.

    Exhibits

    6.      Please
file all missing exhibits with your next amendment,

    Response:  We
have included missing exhibits with this amendment.

    2008 10K (comments 4-6 from
June 5, 2009 Letter substituted for comments 7-9)

              4.

              We note that you filed a
      response letter on June 2, 2009 for your File no. 333­156908 Form
      S-3/A to address the Controls and Procedures listed above in Comment
      three. We specifically note your response to comment 3A (comment 7 in our
      May 28, 2009 letter). We do not understand your response given the
      disclosure in your Form 10-K. We reissue our prior
      comment.

          Reed’s,
Inc.

          June 23,
2009

          Page 2 of
6

              Response:
      We intend to revise the disclosure in Item 9A to clearly differentiate
      between internal control over financial reporting and disclosure controls
      and procedures. Please see our proposed revised Item 9A, attached hereto
      as Exhibit A.
      Subject to the Staff’s approval, we intend to file an amendment to the
      Company’s Form 10-K to include the revised Item
  9A.

                5.

                  We
      note your response to comment 3B (comment 8 in our May 28, 2009 letter).
      Please incorporate your response to comment 3B in an amendment to the Form
      10-K or tell us why you believe an amendment is not
      necessary.

              Response: We intend
      to file an amendment to the Company’s Form 10-K to provide expanded
      disclosure in Item 9A of the remediation efforts by the Company to address
      material weaknesses related to its internal control over financial
      reporting.

                  6.

                      We
      note your response to comment 3C (comment 9 in our May 28, 2009 letter),
      please provide us in greater detail the basis for your belief that your
      disclosure controls and procedures are effective in light of your
      conclusion that your internal control over financial reporting is not
      effective. Please clearly indicate why your material weaknesses related to
      your internal control over financial reporting would not materially affect
      your disclosure controls and procedures. We may have further
      comment.

              Our
      assessment of our internal control over financial reporting, as covered
      under Item 308T, resulted in the determination that we have several
      material weaknesses in our internal control over financial reporting,
      including deficiency in each of (i) in our disaster or backup of core
      business functions, (ii) our segregation of duties and (iii) our
      documented and reviewed system of internal
  control.

              Our
      disclosure controls and procedures include those components of internal
      control over financial reporting that provide reasonable assurances that
      transactions are recorded as necessary to permit preparation of financial
      statements in accordance with generally accepted accounting
      principles.  However, our disclosure controls and procedures do
      not include certain components of internal control over financial
      reporting pertaining to the accurate recording of transactions and
      disposition of assets or to the safeguarding of assets. The particular
      components of internal control over financial reporting in which we
      detected material weaknesses; in our disaster or backup of core business
      functions; and our lack of segregation of duties; and our  lack
      of documented and reviewed system of internal control  are not
      components included in our disclosure controls and
    procedures.

    _________

    We hope
that the information contained in this letter satisfactorily addresses the
Staff’s comments.  Please do not hesitate to contact Ruba Qashu, Esq.,
Qashu & Schoenthaler LLP, by telephone at (949) 355-5405 or by facsimile at
(866) 313-3040.

              Sincerely,

              /s/ Christopher J.
      Reed

              Christopher
      J. ReedChief Executive Officer

              Reed’s,
      Inc.

         Reed’s,
Inc.

          June 23,
2009

          Page 3
of 6

    EXHIBIT
A

    Proposed
Revised Item 9A

    Item
9A.   Controls and Procedures

    Disclosure
Controls and Procedures

    As of
December 31, 2008, the end of the period covered by this Annual Report on Form
10-K, we conducted an evaluation, under the supervision and with the
participation of our Chief Executive Officer and Chief Financial Officer, of our
disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e))
under the Exchange Act). Based on this evaluation, our Chief Executive Officer
and Chief Financial Officer concluded that, as of December 31, 2008, our
disclosure controls and procedures were effective.

    Disclosure
controls are procedures that are designed with the objective of ensuring that
information required to be disclosed in our reports filed under the Securities
Exchange Act of 1934, as amended, such as this report, is recorded, processed,
summarized and reported within the time periods specified in the SEC’s rules and
forms. Disclosure controls are also designed with the objective of ensuring 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 disclosure. Internal controls are
procedures which are designed with the objective of providing reasonable
assurance that our transactions are properly authorized, recorded and reported
and our assets are safeguarded against unauthorized or improper use, to permit
the preparation of our financial statements in conformity with generally
accepted accounting principles.

    We
identified certain matters that constitute material weakness (as defined under
the Public Company Accounting Oversight Board Auditing Standard No. 2) in our
internal control over financial reporting as discussed on Management’s Report on
Internal Control Over Financial Reporting below.

    Management’s
Report on Internal Control over Financial Reporting

    Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting.  Our internal control over financial
reporting is a process, under the supervision of our Chief Executive Officer and
Chief Financial Officer, designed to provide reasonable assurance regarding the
reliability of financial reporting and the preparation of our financial
statements for external purposes in accordance with accounting principles
generally accepted in the United States of America.

    Our
internal control over financial reporting include those policies and procedures
that:

              ·

              pertain
      to the maintenance of records that, in reasonable detail, accurately and
      fairly reflect our transactions and dispositions of our
      assets;

              ·

              provide
      reasonable assurance that our transactions are recorded as necessary to
      permit preparation of our financial statements in accordance with
      accounting principles generally accepted in the United States of America,
      and that our receipts and expenditures are being made only in accordance
      with authorizations of our management and our directors;
    and

        Reed’s, Inc.

          June 23,
2009

          Page 4
of 6

              ·

              provide
      reasonable assurance regarding prevention or timely detection of
      unauthorized acquisition, use, or disposition of our assets that could
      have a material effect on the financial
  statements.

    Because
of its inherent limitations, internal control over financial reporting can
provide only reasonable assurance and may not prevent or detect misstatements.
Further, because of changes in conditions, effectiveness of internal control
over financial reporting may vary over time. Our system contains self monitoring
mechanisms, and actions are taken to correct deficiencies as they are
identified.

    Our CEO
and CFO conducted an assessment of the effectiveness of our internal control
over financial reporting as of December 31, 2008 based on the framework in
Internal Control - Integrated Framework issued by the Committee of Sponsoring
Organizations of the Treadway Commission (“COSO”). A 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.

    Based
upon that assessment, we have identified the following material
weaknesses:

    Insufficient
disaster recovery or backup of core business functions

    Inadequate
backup of our critical data and software used by our business could cause loss
of financial data and business interruptions, should a disaster
occur.  We have implemented regular backup procedures for our data
relating to our financial reporting, which include off-site
storage.  We are planning to also install a remote server running the
software programs used for our financial reporting processes, so that we can
quickly recover our backup data and use it at a remote location, in the event of
a disaster.  We anticipate this additional measure to be completed in
the next quarter.

    Lack
of segregation of duties

    We have
limited staff in our corporate offices and, as such, there is a lack of
segregation of duties.  With the resignation of our Chief Financial
Officer in April 2008, our Chief Executive Officer assumed the duties of both
President and Chief Financial Officer.  Many functions, including
purchasing, accounts payable, bank reconciliations and month end closings, have
not been adequately segregated.  In January 2009, we hired a Chief
Financial Officer, adding to the management oversight of financial accounting
processes.  We now have separate individuals performing purchasing,
accounts payable processing, and bank reconciliations.  Our Chief
Financial Officer supervises and reviews the month end closing
process.  Our Chief Operating Officer oversees the cash
disbursements.  Checks are signed by the Chief Executive
Officer.  At this time, we believe that we have established adequate
segregation of duties to the extent possible with our small staff
size.  The close supervision and oversight by management also
mitigates the remaining weakness in internal controls resulting from a lack of
segregation of duties.

    Lack
of documented and reviewed system of internal control

    We have
an internal control weakness due to the lack of a documented and reviewed system
of internal controls.  We have determined that to perform the
processes and remediate this internal control deficiency, we will either need to
engage an internal control consultant or reassign existing
personnel.  We have started to enhance some of our key internal
control systems surrounding inventory purchasing and control, and to document
those changes; however, this process is on-going and the implementation of
policies and procedures may take several quarters.

        Reed’s,
Inc.

          June 23,
2009

          Page 5
of 6

As a
result of the material weaknesses described above, management concluded that, as
of December 31, 2008, we did not maintain effective internal control over
fina