Rick Eiswirth, chairman of the board of Jones Soda Co., says: “The challenging economic environment combined with our current capitalization has made it extremely difficult to operate on a standalone basis. After evaluating a range of strategies aimed at improving our outlook, our Board of Directors determined that the proposed merger with Reed’s offers our shareholders the most compelling long-term benefits of the available alternatives. We believe the combination of Jones and Reed’s will create a substantially larger beverage business with a more powerful operating platform and a brighter future. We are especially pleased that the Jones shareholders will be able to participate in the potential upside of the combined business, as a meaningful portion of the consideration is in the form of Reed’s stock.”
Jones Soda also announced that Joth Ricci will be stepping down as chief executive officer effective April 2, 2010 in order to pursue other business opportunities. Joth Ricci comments, “I have truly enjoyed my time at Jones Soda and I’m pleased with the work our team has done to improve many aspects of our business. Unfortunately, due to the current market conditions, it has taken longer than anticipated to produce the necessary top line results to effectively return to profitability and stem our cash burn. However, I remain confident in the strength of the Jones Soda brand and believe the proposed merger with Reed’s provides Jones Soda an improved platform from which to capitalize on its future prospects and is in the best interests of its shareholders.”
Under the binding provisions of the LOI, Reed’s and Jones Soda have until April 5, 2010 to negotiate a definitive agreement on an exclusive basis. If Jones Soda receives an unsolicited acquisition, financing or other strategic transaction proposal that the Board of Directors of Jones Soda determines is superior to the proposed merger transaction with Reed’s, then Jones Soda may terminate the LOI and reimburse Reed’s for its third party out-of-pocket expenses (not to exceed $75,000).
For more information about Reed’s, please visit www.reedsgingerbrew.com or call 1-800-99-REEDS.
For more information on Jones Soda, visit www.jonessoda.com.
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