Good afternoon, everyone, and thank you for participating in today's conference call to discuss, Jones Soda's Financial Results for the Second Quarter Ended June 30, 2021. Before we begin, let me remind everyone of the company's Safe Harbor disclaimer. Certain portions of our comments today will concern future expectations, plans and prospects of the company that constitute forward-looking statements for purposes of the Safe Harbor provisions under the Private Securities Litigation Reform Act of 1995. Forward-looking statements include all statements containing verbs such as aims, anticipates, estimates, expects, believes, intends, plans, predicts, will, may, continue, projects or targets and negatives of these words and similar words or expressions. Forward-looking statements are subject to certain risks and uncertainties that could cause actual results to differ materially from those indicated by the forward-looking statements. Factors that could affect our actual results include, among others, those that are discussed under the heading Risk Factors in our most recently filed reports with the SEC, including our annual report on Form 10-K, our quarterly reports on Form 10-Q and our current reports on Form 8-K. In addition, this call includes discussions of certain non-GAAP financial measures. The most direct comparable GAAP measures and reconciliations for non-GAAP measures are available in the earnings release and other documents posted on the company's website under Investor Relations. I would like to remind everyone that this call will be available for replay through August 12, 2021, starting at 7:30 p.m. Eastern Time tonight. A webcast replay will be also available via the link provided in today's press release as well as on the company's website. Now, I would like to turn the call over to President and CEO of Jones Soda, Mark Murray.

Yeah. Thank you Sergey and thank you everyone for joining us today. We had an outstanding quarter with significant increase in revenues as compared to same quarter a year ago. We returned to profitability and reported our fourth, consecutive quarter of revenue growth. Looking at historical results, this is our highest Q2 sales number, since 2012 and our first profitable quarter since 2016. We had a great first half of the year. And I want to thank our team for staying focused, as they continue to execute on our three-year turnaround plan which we set in motion at the end of 2020. On the call today, I'll discuss all of this in further detail. And provide an update on our sales performance, marketing initiatives and operations. We'll then wrap-up with the Q&A session, to close out the call. First, I'd like to hand the call over to Joe, to discuss our exciting financial results for the quarter. So, Joe?

Thank you Mark, and good afternoon everyone. Total revenue in the second quarter increased 44% to $4.5 million, compared to $3.1 million in the second quarter of 2020. This increase was primarily driven by growth in our core bottled soda business and the recovery within our high-margin foodservice category. Gross profit as a percentage of revenue increased substantially to 31.3%, compared to 18.9% in the year ago quarter. The improvement was a result of one, the continued shift to a higher-margin product mix which includes the initial recovery of our foodservice business. And two, our ongoing efforts to optimize costs across our supply chain. Operating expenses in the second quarter were $1.4 million, compared to $1.3 million in the same year ago quarter. The slight increase was driven by incremental marketing expenses related to our new augmented reality Reel Label series, multiple Special Release flavors, additional digital marketing efforts such as, our new Jones Soda phone application and an increase in paid social media, search engine optimization and influencer and e-mail marketing efforts. Net income in the second quarter improved to $309,000 or $0.00 per share compared to a net loss of $738,000 or negative $0.01 per share for the prior year period. We believe that it is important to note that, even excluding the benefits of our PPP loan forgiveness we received during the quarter which was a one-time benefit to our bottom-line we were still able to achieve profitability from an operating perspective for the quarter, for the first time since 2016. Adjusted EBITDA in the second quarter improved to $395,000, compared to negative $653,000 in the prior year period. These profitability improvements are a result of our concentrated efforts to manage costs and optimize margins both of which will be a -- will remain a focus as we continue to grow the business. Now moving on to the balance sheet, on June 30th 2021, cash and cash equivalents were $3.1 million, compared to $4.6 million on December 31st 2020. Working capital was $4.7 million at June 30th 2020, compared to $5.8 million at December 31st 2020. Lastly, the only debt, we currently carry, are the outstanding convertible debt instrument. And we continue to actively evaluate the possibility of securing a new line of credit. I'll now hand the call back over to Mark, for his remarks.

Thank you, Joe. Great financial results, which we believe are evidence that our turnaround strategy is working. It's been a team effort. And I want to thank our dedicated employees and stakeholders, for all the work they've done and continue to do, as we develop and grow our business. Before I discuss, sales, marketing and operations in more detail, I want to acknowledge a question that's probably on everybody's mind. A few weeks ago, we put out a press release regarding a partnership that we're working on towards the cannabis industry. We're very excited about creating a new cannabis business line and think there's an opportunity for Jones, to break into this space. We believe the cannabis-infused beverages and edibles are a perfect extension of our brand. The press release called out that we have a signed letter of intent and we are working together towards a signed definitive agreement. Once we have the signed definitive agreement, we have closed the deal and we'll share our upcoming plans in more detail. So now let's jump into our core bottled soda business. We continue to work with our partners to ensure our products are promoted and displayed effectively in retail locations. These products include our top-selling flavors like Cream Soda, Berry Lemonade and Orange & Cream, as well as sodas that are part of our Special Release series, which includes limited edition flavors that rotate every six months. Pineapple Cream is our current Special Release flavor and then in October we'll release Turkey & Gravy soda our number one most requested fan favorite, just in time for the holiday. Consumers can find these rotating flavors on our website and many retailers including Hy-Vee, Albertsons, Safeway and Kroger's. We've had a long successful relationship with Kroger and sales of our Special Release flavors within their network have enhanced the overall growth of our business significantly over time. Another part of our core bottled business is our variety packs, which we have introduced earlier in the year. We have multiple variety packs including the Fan Faves Variety Pack and Mixer Variety Pack. These variety packs take advantage of value pricing and pantry stocking behavior and have helped our business by providing incremental sales opportunities. Towards the end of the quarter and just-in-time for the 4th of July, we announced a new limited edition three-flavor Red White and Blue variety pack, which includes our Strawberry Lime, Lemon Lime and Berry Lemonade flavors. This variety pack was requested by and sold across Costco's California Bay Area location and is also currently being sold on our website. This new Costco placement is a good lead-in for an update regarding our investment into the club channel business. We announced in May that we have engaged the services of Prime Sales & Marketing, a food and general merchandise broker. Prime works exclusively with brands selling to Walmart and Sam's Club. With this new partnership we are working to expand our relationship with the Walmart organization. We believe that our products and especially our value packs support the value, merchandising and assortment needs of warehouse clubs. We will continue to make investments in this space in an effort to grow our footprint within these channels. Now to discuss our foodservice channel. Foodservice is recovering from the impacts of the pandemic and we expect this to accelerate in the back half of the year. We continue to allocate resources to this channel and believe it is a growth opportunity for us in the future, given our unique high-quality products, including packaged beverages, fountain beverages and frozen slush products. As discussed last quarter, our Birthday Cake Soda is currently being featured as an exclusive Slurpee flavor throughout the summer at hundreds of 7-Eleven locations in the Pacific Northwest. The Slurpee flavor is a big hit and is exceeding both 7-Eleven's and Jones' expectations and forecast. We look forward to more collaborations with 7-Eleven in the future. I'd also like to share that we are distributing Jones' products in some alternative channels. We have a partnership with HomeGoods and we also expanded our product assortment to Dollar Tree stores in Canada in a hope to expand our business with this chain in the US as well. Our distinctive soda flavors are appealing to shoppers at these stores driving sales and improving our brand recognition. I am happy to report that we are now seeing healthy growth with Lemoncocco. We have restructured our distribution network in Canada and have seen the business notably improve. We also continue to work with large food service customers in US offering them a unique grab-and-go item or a great beverage to be used as a mixer ingredient. As stated on prior calls, we are presenting new flavors, packaging and case configurations to our customers, and these additions are being very well received. There is still more work to do, but we are pleased with the incremental progress we made to-date. Now an update on our marketing activities. Our unique labels continue to be the ultimate platform to display unique consumer perspectives and engage with our fans. As we continue to build on this point of difference, we are excited to share that we recently released our augmented reality labels on millions of bottles of our top-selling soda flavors in the US and Canada. The AR label showcase various different influencers, including a surfer, tattoo artists, DMX rider, fire spinning circus performer and more. These AR labels not only capitalize on the behavior of a Gen Z content creators, but also make our labels a vehicle for true consumer engagement. I urge all of you to buy your favorite Jones soda, download the app and then use the app to see our new AR labels come to life. These AR labels, like all our labels, focus on the stories of our fan and we are currently accepting video submissions through the end of September for our next cycle of user-generated content AR labels, which will be released in March of 2022. On that note, I would also like to remind everyone that Jones' fans and consumers are always welcome to submit photos on our website and our app. Back in January, we relaunched our photo gallery to make submissions easier for our customers. Since then we've seen average daily submissions double, which we expect to grow with inclusion of the video submissions as part of our ongoing augmented reality initiatives. We believe that each submission will receive -- we receive shapes our brand's personality and emphasizes our message of the People's Craft Soda. We are pleased with the high levels of engagement, we have with our loyal customers and fans. During the quarter, we continued to enhance our efforts in digital marketing in order to amplify our message and create brand awareness in a very cost-effective manner. We continue to challenge the team to drive conversion in overall sales. We always look for new and innovative ways to be at the forefront of digital marketing. Our impressions rose by 46% compared to Q1. We are driving a successful return on our current ad spend with Google. In addition, we continue to partner with social media influencers who advocate for our brand. We began running ads directly through the accounts of these influencers, which increases our brand awareness and trust, while reaching a whole new qualified audience. With our newly defined audiences, we can help ensure that the dollars we put into paid social are being spent on people most likely to purchase Jones' products in the store and online. In addition, we began to invest in e-mail marketing as another way to reach consumers, which has yielded a monthly average growth of over 20% on our direct-to-customer business. Our investments in paid media, including social ads, influencer marketing and Google ads have allowed us to reach over 3.4 million unique users. With the addition of our new Jones Soda app, which not only includes AR, but also a option to find Jones in stores, I believe we will continue to be at the forefront of digital marketing and drive growth for the overall business. Now let's discuss operations. Our team continues to do an excellent job meeting demand and servicing our customers even as our volume increases. As Joe said, we put forth a strong effort to optimize all aspects of our supply chain. This is extremely important for the back half of the year because we are certainly not immune to the challenges associated with inflation and supply chain shortages that are affecting industries across the board. Most notably, we are seeing cost pressures from rise in commodity prices. We are working closely with our supply partners to manage these costs and mitigate the impact on margins. Although, we anticipate there will be a slight increase in input costs for the back half, we do not expect this to impact our ability to meet our internal expectations. Before I recap the call, and Joe and I dive into Q&A, I want to reiterate that the health and safety of our employees, supply chain partners, distributors and all stakeholders remain our top priority as the world deals with the continued effects of COVID. I remain very proud of our team here at Jones for all they have accomplished despite the pandemic and I thank them for their focus and execution on the turnaround plan. So let me recap the highlights of the call. From a revenue perspective, 44% over a year ago, we now have four consecutive quarters with year-over-year growth and we reported the highest quarterly revenue number since 2012. We increased gross margins by over 1000 basis points and had our first profitable quarter since 2016. Three, our core bottled soda business remains a key driver of growth. We will continue to work to lead the craft soda category in innovation. We want to utilize our limited time offerings to attract old and new customers alike. Our augmented reality labels are in stores now. We upgraded our website and we continue to improve efficiencies on paid media spend. Five, we are facing supply chain challenges and have plans in place to mitigate the impact. We will work to control costs and we will continue to provide superior customer service. Sixth, very exciting news for the future. We are working towards launching a cannabis business line. This will be transformational for the organization. We are currently working to build the organization, the product portfolio and our go-to-market strategy. We are excited to share our plans when we finalize the deal. And number seven and most importantly the safety of our employees will remain our number one priority and we will continue to listen to the advice of the health experts. So overall, I am extremely proud of the progress we have made in the second quarter and I expect solid results for the balance of the year. We remain committed to providing best-in-class products and service to our customers and partners, and we expect to continue improving upon the fundamentals of our business as we go forward, working to accelerate our growth and improving profitability, as we execute on our turnaround plan. Lastly, I thank our team, our partners and our consumers for their continued loyalty and support. With that I'll turn the call back over to Joe for Q&A. A - Joe Culp: Before wrapping up the call Mark and I would like to address some of the questions we've received from investors via e-mail over the last few weeks. We have selected what we believe to be the most important and relevant questions to answer. So starting with the first question. Are your manufacturing partners being affected by supply chain issues and to what extent does that affect Jones? Additionally, are you or any of your partners having difficulties with the labor shortage issue?

Yes, we addressed a little bit of this early on. But while the current environment is certainly challenging for manufacturers in all industries, we have been able to manage ahead of these concerns by working especially closely with our supply chain partners. By forecasting further out and increasing our inventories on certain raw materials and finished goods we believe we will mitigate some if not most of these risks.

All right. Question number two when you think about the turnaround plan that you've set in place at the end of last year are there goals that you've changed or fine-tuned at all?

No I'm proud to say that we remain very confident in our 3-year strategic plan and are exceeding internal expectations. I think fine-tune is a key word here. We will always be looking at ways to fine-tune the plan. I think one surprise for us has been our ability to penetrate alternative channels. We mentioned HomeGoods and Dollar Tree. This was not called out on the original plan and now we're looking at how do we continue to grow in this space and what are some other channel opportunities? The second thing I would also say because of our increasing brand awareness and positive energy around the organization we are talking to several world-class organizations looking for ways to partner with us and we will continue to look at partnerships and licensing opportunities.

All right. Question three. As you continue to grow your business are there certain regions that you've identified that Jones doesn't have a large presence in but have favorable consumer dynamics?

Well we have a lot of room to improve penetration across the entire country. Southern California is one opportunity that we talk about as we are dedicated to owning our backyard. Another area that we are focusing on is the Midwest. This was the largest Jones market 15 years ago it is about 1/3 of the size today. Specifically Michigan was a big market. We hired the original person who is responsible for growing the business and the brand in the Midwest and he has done an excellent job in the last six months gaining points of distribution and building back the business and brand awareness.

Okay. Fourth question. Regarding the cannabis initiative you've worked with SOL in the past to launch a CBD-infused soda that never got off the ground. What makes you confident about this latest initiative?

First, regarding CBD we've mentioned on the last call that we have a portfolio developed with great packaging ready to launch waiting for federal regulations and guidelines and this has caused a challenge. But when you ask what is different and why I'm confident about the partnership moving forward? I'd say a couple of things: one is we are a different company today. And I have no interest looking back at what could have or should have happened on the last deal. This is a partnership. We will own it and we'll be doing our part to execute a great plan. Two, not only did we get the financing resources but just as important we're getting people and expertise as part of the deal. We intend to hire new employees who have knowledge expertise and connections in the cannabis industry and we will be working together in an effort to develop and execute a world-class plan.

All right. Last question here. In general, is your dedicated sales team back to selling in-person or are they selling virtually?

This is driven by the key customers and the protocols that they -- their organizations have put in place. Most of the customers are still working remote. And thus we are still selling virtually probably nine out of 10 are the calls. We expected Canada to open up in the middle of August so we look forward to seeing some of our key customers shortly. But based on what new news today, we'll have to listen to what the science says and act accordingly so.

All right. And that concludes all the questions we have. And this and in general we'd like to thank everyone for listening to today's call and we look forward to speaking you speaking with you when we report our third quarter results for 2021. Thanks again for joining us.

Ladies and gentlemen this concludes today's teleconference. You may disconnect your lines at this time. Thank you for your participation.