SCHEDULE 13D/A: Major Shareholder Restructuring: Era Regenerative Medicine Becomes Holding Company for REED'S, INC. Majority Stake

Era Regenerative Medicine Ltd has become the new holding company for D&D Source of Life Holding Ltd's 59.5% beneficial ownership stake in REED'S, INC. common stock, following a restructuring on December 31, 2024.

Summary

• Era Regenerative Medicine Ltd (ERM) has been assigned all outstanding shares of D&D Source of Life Holding Ltd (D&D) as a holding company for restructuring purposes, effective December 31, 2024, with no payment of consideration.
• ERM and D&D collectively beneficially own 27,139,520 shares of REED'S, INC. common stock, representing 59.5% of the class.
• This ownership percentage is calculated based on 45,371,247 shares of common stock outstanding as of March 19, 2025, and 232,108 shares issuable upon exercise of currently exercisable warrants.
• Dai Siqi, the sole director of ERM, holds voting and dispositive power over these securities.
• D&D's aggregate purchase price for REED'S, INC. securities previously acquired totals $23,361,710, assuming the exercise of warrants for an additional $580,270.
• Key past investments by D&D include: $3 million for 1,160,542 common shares and warrants for 232,108 shares in a PIPE transaction on May 25, 2023 (warrants exercisable at $2.50 per share); $3 million in SAFE vehicles in Q1 2024, which converted into 2,000,000 common shares at $1.50 per share; $1,903,192 for 1,268,795 additional common shares in a subsequent PIPE financing on September 10, 2024; and $17,878,248 for eight secured promissory notes from Whitebox on October 22, 2024, which were exchanged for 22,478,074 common shares on November 18, 2024.
• The purpose of these acquisitions and the restructuring is for investment purposes and the expansion of business.
• The Issuer's bylaws were amended to grant the majority stockholder the ability to call a stockholders meeting and other customary rights for a controlled company, with these changes approved by the Issuer's board of directors.

Sentiment

Score: 7

Explanation: The document indicates a stable and consolidated majority ownership, with significant past investments by the controlling entity. The restructuring is for internal purposes and does not suggest negative operational changes. The intent for investment and business expansion is positive, and the corporate governance changes are standard for a controlled company.

Positives

• The restructuring consolidates the majority ownership under Era Regenerative Medicine Ltd, potentially streamlining strategic decision-making for the controlling entity.
• The significant aggregate investment of $23,361,710 by D&D (now under ERM) demonstrates a strong financial commitment to REED'S, INC.
• The conversion of secured promissory notes into equity reduces the Issuer's debt burden, which is generally positive for the company's financial structure.
• Amendments to the Issuer's bylaws provide the majority stockholder with customary rights, which can facilitate strategic alignment and operational efficiency for a controlled company.

Future Outlook

The Reporting Persons may in the future engage in discussions with the Issuer's management, board of directors, and/or other stockholders or third parties covering a broad range of subjects, including relative to performance, strategic direction, capital allocation, strategic financing opportunities or other transactions involving the Issuer, stockholder value, composition of the board of directors, and governance and/or ownership of the Issuer. These discussions are for investment purposes and business expansion.

Management Comments

• Dai Siqi, currently the sole director of ERM, has voting and dispositive power over the securities of the Issuer held directly by D&D.

Industry Context

This filing indicates a significant consolidation of control in REED'S, INC. by a major investor, D&D Source of Life Holding Ltd, now under the umbrella of Era Regenerative Medicine Ltd. D&D's primary business in mineral water, beverages, and functional foods suggests a potential strategic alignment or expansion into the beverage sector for REED'S, INC., which is known for its ginger ale and other natural beverages. The acquisition of notes and conversion to equity also highlights a common strategy for investors to gain significant stakes and influence in companies.

Management Changes

Corporate Governance

Related Party Transactions

• On December 31, 2024, all outstanding shares of D&D were assigned to ERM, as holding company, for restructuring purposes without requirement of payment of consideration. This is an internal restructuring between related entities.

Stakeholder Impact

• Shareholders: Consolidation of majority ownership under ERM provides clarity on control. The past significant investments and future strategic discussions could lead to value creation or strategic shifts. Minority shareholders might see reduced influence due to majority control.
• Management/Employees: The majority shareholder's stated intent for 'expansion of business' could imply growth opportunities. Corporate governance changes might lead to closer oversight from the majority shareholder.
• Creditors: The conversion of secured promissory notes into equity reduces debt burden for REED'S, INC., which is generally positive for creditors.

Next Steps

• Reporting Persons may engage in future discussions with Issuer's management, board, other stockholders, or third parties regarding performance, strategic direction, capital allocation, financing opportunities, stockholder value, board composition, and governance.

Key Dates

Recommendation

Keywords

REED'S, INC., RZBD, Schedule 13D, beneficial ownership, Era Regenerative Medicine Ltd, D&D Source of Life Holding Ltd, common stock, PIPE transaction, secured promissory notes, corporate restructuring, majority shareholder, corporate governance, SEC filing