UNITED STATES DISTRICT COURTWESTERN DISTRICT OF WASHINGTON

AT SEATTLE

ROGER ADRAGNA, Individually and On Behalf )of All Others Similarly Situated, )

Plaintiff, )

vs.

JONES SODA COMPANY, PETER M. VANSTOLK, HASSAN N. NATHA, SCOTT )BEDBURY, MICHAEL M. FLEMING, ALFREDW. ROSSOW, JR., JOHN J. GALLAGHER, JR.,STEPHEN C. JONES, and LARS P. NILSEN, )

Defendants.

CIVIL ACTION NO.

CLASS ACTION COMPLAINT

JURY TRIAL DEMANDED

Plaintiff, Roger Adragna ("Plaintiff'), alleges the following based upon the investigation

by Plaintiffs counsel, which included, among other things, a review of the defendants' public

documents, conference calls and announcements made by defendants, United States Securities

and Exchange Commission ("SEC") filings, wire and press releases published by and regarding

Jones Soda Company ("Jones Soda" or the "Company"), securities analysts' reports and

advisories about the Company, and information readily available on the Internet , and Plaintiff

believes that substantial additional evidentiary support will exist for the allegations set forth

herein after a reasonable opportunity for discovery.

NATURE OF THE ACTION AND OVERVIEW

1. This is a federal class action on behalf of purchasers of Jones Soda's securities

between November 1, 2006 and August 2, 2007, inclusive (the "Class Period"), seeking to pursue

remedies under the Securities Exchange Act of 1934 (the "Exchange Act")

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2. Jones Soda engages in the development, production, marketing, and distribution

of beverages primarily in the United States and Canada. The Company distributes its products

through a network of independent distributors and national retail accounts, as well as through

licensing and distribution arrangements.

3. On August 2, 2007, the Company shocked investors when it announced

disappointing financial results for the Company's second quarter 2007. The Company reported

$0.00 earnings per share, and that its gross margin had significantly decreased. More troubling

to investors was the disclosure that the Company's disappointing sales for the quarter were the

result of production and distribution delays in the long planned and hyped national rollout of

Jones Soda's canned products . The Company disclosed that it did not reach its targeted

penetration until July 2007, despite prior statements that the canned products would be on

retailer's shelves in advance of the Memorial Day holiday weekend, the "start of the beverage

selling season."

4. On this news, the Company's shares declined $3.95 per share, or over 25.8

percent, to close on August 3, 2007 at $11.35 per share, on unusually heavy trading volume.

5. The Complaint alleges that, throughout the Class Period, defendants failed to

disclose material adverse facts about the Company's products , financial well-being, and

prospects . Specifically, defendants failed to disclose or indicate the following: (1) that the

Company had experienced significant production and distribution delays in the national rollout

of its canned products ; (2) that the Company lacked the necessary personnel to launch its

national rollout of canned products; (3) that the Company had failed to secure adequate retail

shelf space for its canned products in advance of the Memorial Day holiday weekend, the start of

the beverage selling season ; (4) as such, the Company's canned products would not be widely

2

available for sale in major retail chains in time to capitalize on the Memorial Day holiday

weekend sales opportunity; (5) that the planned national rollout of the Company's canned

products had failed to achieve internal expectations or targets ; (6) that the Company would be

forced to cancel its advertising planned for the Memorial Day holiday weekend; (7) that

Starbucks had intended to discontinue sales of the Company's products ; and (8) that, as a result

of the foregoing, the Company's statements about its future business operations and prospects

were lacking in a reasonable basis when made.

6. On this news, the Company's shares fell $3.95 per share, or 28.5 percent, to close

on August 3, 2007 at $11.35 per share, on unusually heavy trading volume.

7. As a result of defendants' wrongful acts and omissions, and the precipitous decline

in the market value of the Company's securities, Plaintiff and other Class Members have suffered

significant losses and damages.

JURISDICTION AND VENUE

8. The claims asserted herein arise under and pursuant to Sections 10(b) and 20(a) of

the Exchange Act, (15 U.S.C. §§ 78j(b) and 78t(a)), and Rule lOb-5 promulgated thereunder (17

C.F.R. § 240.1Ob-5).

9. This Court has jurisdiction over the subject matter of this action pursuant to

Section 27 of the Exchange Act (15 U.S.C. § 78aa) and 28 U.S.C. § 1331.

10. Venue is proper in this Judicial District pursuant to Section 27 of the Exchange

Act, 15 U.S.C. § 78aa and 28 U.S.C. § 1391(b). Many of the acts and transactions alleged

herein, including the preparation and dissemination of materially false and misleading

information, occurred in substantial part in this Judicial District . Additionally, Jones Soda's

principal executive offices are located within this Judicial District.

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11. In connection with the acts, conduct and other wrongs alleged in this Complaint,

defendants, directly or indirectly, used the means and instrumentalities of interstate commerce,

including but not limited to, the United States mails, interstate telephone communications and

the facilities of the national securities exchange.

PARTIES

12. Plaintiff, Roger Adragna, as set forth in the accompanying certification,

incorporated by reference herein, purchased Jones Soda's securities at artificially inflated prices

during the Class Period and has been damaged thereby.

13. Defendant Jones Soda is a Delaware corporation with its principal place of

business located at 234 9th Avenue North, Seattle, Washington.

14. Defendant Peter M. van Stolk ("van Stolk") was, at all relevant times, the

Company's President, Chief Executive Officer ("CEO") and Chairman of the Board of Directors.

15. Defendant Hassan N. Natha ("Natha") was, at all relevant times, the Company's

Chief Financial Officer ("CFO") and Secretary.

16. Defendant Scott Bedbury ("Bedbury") was, at all relevant times, a member of the

Company's Board of Directors.

17. Defendant Michael M. Fleming ("Fleming") was, at all relevant times, a member

of the Company' s Board of Directors.

18. Defendant Alfred W. Rossow, Jr. ("Rossow") was, at all relevant times, a member

of the Company' s Board of Directors.

19. Defendant John J. Gallagher, Jr. ("Gallagher") was, at all relevant times, a

member of the Company's Board of Directors.

20. Defendant Stephen C. Jones ("Jones") was, at all relevant times, a member of the

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Company's Board of Directors.

21. Defendant Lars P. Nilsen ("Nilsen") was, at all relevant times , the Company's

Executive Vice President of Sales.

22. Defendants Van Stolk, Natha, Bedbury, Fleming, Rossow, Gallagher, Jones, and

Nilsen are collectively referred to hereinafter as the "Individual Defendants." The Individual

Defendants, because of their positions with the Company, possessed the power and authority to

control the contents of Jones Soda's reports to the SEC, press releases and presentations to

securities analysts, money and portfolio managers and institutional investors, i.e., the market.

Each defendant was provided with copies of the Company's reports and press releases alleged

herein to be misleading prior to, or shortly after, their issuance and had the ability and

opportunity to prevent their issuance or cause them to be corrected. Because of their positions

and access to material non-public information available to them, each of these defendants knew

that the adverse facts specified herein had not been disclosed to, and were being concealed from,

the public, and that the positive representations which were being made were then materially

false and misleading. The Individual Defendants are liable for the false statements pleaded

herein, as those statements were each "group-published" information, the result of the collective

actions of the Individual Defendants.

SUBSTANTIVE ALLEGATIONS

Background

23. Jones Soda engages in the development, production, marketing, and distribution

of beverages primarily in the United States and Canada. The Company distributes its products

through a network of independent distributors and national retail accounts, as well as through

licensing and distribution arrangements.

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Materially False and MisleadingStatements Issued During the Class Period

24. The Class Period begins on November 1, 2006. On this day, the Company issued

a press release entitled "Jones Soda Co. Announces 2006 Third Quarter Financial Results."

Therein, the Company, in relevant part, stated:

a Third Quarter Revenues Increased 14.6% to $10. 2 million

a Company Reports 3Q06 Diluted EPS of $0.01

a Cash on hand $32.4 million

Jones Soda Co. (the "Company" or "Jones") today announcedfinancial results for the third quarter ended September 30, 2006.

Revenue for the third quarter of fiscal 2006 increased 14.6% to$10,200,843 compared to $8,900,692 for the third quarter of fiscal2005. Net income was $194,774 or $0.01 per diluted share, versusnet income of $846,286, or $0.04 per diluted share, for the sameperiod last year.

For the nine months ended September 30, 2006 revenues increased17.1% to $28,987,200 compared to $24,759,677. Net income forthe nine months ended September 30, 2006 was $2,511,111 or$0.10 per diluted share, versus net income of $702,781 or $0.03per diluted share. The year to date net income for 2006 includes aone-time non-cash income tax benefit of $1,482,934 recorded inthe second quarter, related to the reversal of a significant portion ofour valuation allowance for net deferred tax assets. Prior to the2006 second quarter, we maintained a valuation allowance for ourdeferred tax assets (in accordance with SFAS No. 109,"Accounting for Income taxes") due to the uncertainty regardingthe full utilization of our deferred net tax asset.

***

Gross margin for the third quarter increased 70 basis points to35.5% versus 34.8% in the third quarter of the prior year.Operating expenses as a percentage of sales were 36.9% during thequarter compared to 28.4% for the corresponding period a yearago.

Management believes that the presentation of non-GAAP financialmeasures provides useful information to investors regarding the

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Company's income from operations and comparisons to prioryears' results.

Peter van Stolk, President and C.E.O stated, "We are pleasedwith our top line performance for the third quarter which wasdriven by ongoing strength in our DTR channels of distribution,coupled with revenue growth in our DSD business. We alsoexperienced meaningful gross margin improvement as wecontinued to benefit from cost efficiencies. However, our earningswere impacted by our strategic decision to focus on the launch ofour cans which is slated for the first quarter of 2007. Theadditional investments in this new operating platform is criticalprior to the launch to ensure our future growth plans areachieved "

Mr. van Stolk continued, "During the third quarter we announced a5-year distribution and manufacturing agreement with NationalBeverage Corporation for 12-ounce cans of Jones Soda and 16-ounce cans of Jones Energy for the U.S. market beginning in 2007.After a successful 2-year licensing agreement with Target forJones Soda cans, we now believe it is in the best interests of ourcompany to expand our presence in the $66 billion CSDcategory. In an effort to maximize our opportunities with ourlarge network of beverage retailers across the country and bestprepare for the upcoming launch we are hiring additionalpersonnel, making upgrades to our infrastructure, andincreasing our sales and marketing expenditures. We believethese investments will well position us to capitalize on the manyprospects we believe existfor this business."

Mr. van Stolk concluded, "We are very pleased with our sales andearnings results for the first nine months of fiscal 2006 and as welook out to next year, we are very excited about the direction ourcompany is headed. Through our core DSD operating segment andDTR relationships with leading retailers such as Starbucks, PaneraBread, and Barnes & Noble, our brand recognition has grownsignificantly over the past several years. We now look forward tobuilding on our position with our expansion in the CSD marketand taking this company to the next level We remain committedto delivering long-term profitable growth and returning value toour shareholders." [Emphasis added.]

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25. Also on November 1, 2006, Jones Soda held an earnings conference call with

investors and financial analysts. During this call, Defendant van Stolk, in relevant part, stated:

We are pleased with our continued top line strength during thequarter. Total sales increased approximately 14.6% driven byongoing gains in our DTR business.

I think it's important to note that during the third quarter wehave been focused on the launch ofour 12-ounce can which willhit the shelf early next year. While this investment strategyimpacted our earnings in this quarter, we are confident that itbetter positions our Company for the fourth quarter as well as2007 and beyond

As we have announced, it is our intention to introduce the Jones

12-ounce fridge pack to a greater number of retailers beginning

in thefirst quarter 2007. Increasing from 2% ACV, all commodity

volume, which Target represents, to a meaningful double digit

number requires a very focused approach. We've been introducing

the fridge pack to retailers across the country and while our efforts

are not reflecting in our third quarter earnings, they are critical to a

successful launch of our can business. The fact remains, we need

to focus on our cans to ensure the rewards in the near and long

term.

***

The key strategic initiative in the quarter was securing theproduction agreement with National Beverage. This agreementensures that we have the ability to supply our new retailcustomers in 2007. We cannot overstate the importance of asupply agreement when it comes to the 12-ounce can. Our retailcustomers need to know they will have a consistent supply ofproduct during the peak summer months. National Beverage hasassured us that we have access to over 35 million cases ofproduction annually.

***

Ijust want to reiterate how pleased we are about the upcomingdebut of our can business and the positive impact it will have onour future performance beginning in the fourth quarter. We arecurrently in discussions with several leading national retailers, and

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while it's still early, the feedback has been extremely positiveacross the board.

***

[ANALYST]: ... A quick question just to sort of get my handsaround what the timeframe might be in terms of as you're goinginto retailers next year on the can business . Have you wrapped upmost of the more -- convincing these guys to try to take yourproducts off the shelves next year? Is that already set in stone nowor is there still a chance that you might see either some guys backout or some possibly more guys come on in the next couple ofmonths or before the end of the year?

[VAN STOLK]: I think it has to do with when the retailers set theirshelf Alton . So retailers set their shelf in January or February orthey set it in March so it's all relevant to their resetting of theirshelf.

We feel very comfortable that we've hit the January set and weare really, really comfortable with respect to that.

On the February, March sets we have lots of - we feelcomfortable that we are hitting those and we are going to geteven more of those. So it's really-- those are the dynamics of theindustry. When they set their shop is it. So are we finished? No,not at all. Do we feel good about the numbers that we have? Yeswe do. [Emphasis added.]

26. On November 28, 2006, the Company issued a press release entitled "Jones Soda

Co. To Launch Only Nationally Branded 12 Ounce Canned Soda Sweetened With Pure Cane

Sugar." Therein, the Company, in relevant part, stated:

Jones Soda Co. (the "Company" or "Jones"), is pleased toannounce that the Company will launch its 12 ounce canned sodasweetened with pure cane sugar instead of high fructose cornsyrup (HFCS). The brand will be called Jones Pure Cane Sodaand will be sold as a 12 ounce can package. Jones Pure CaneSoda will be unique in the carbonated soft drink (CSD) categorycompared to other national brands that are sweetened with HighFructose Corn Syrup.

***

Peter van Stolk, President and CEO stated, "We are very excitedwith today's announcement because we are confident that

9

consumers and retailers will appreciate the benefits of drinking aproduct sweetened with Pure Cane Sugar and the uniquepositioning of Jones Pure Cane Soda compared to all other nationalbrands sweetened with HFCS".

Mr. van Stolk continued, "Converting from HFCS to pure canesugar with our new our 12 ounce can line truly differentiatesJones and provides the consumer with a healthier alternative. Theconversion process is not a simple one, as proven by the fact thatno other national branded carbonated soft drink (CSD) has madethe conversion, however we have worked very hard with NationalBeverage Corp. to ensure that the launch of Jones Pure Cane Sodais on schedule for first quarter 2007".

Mr. van Stolk concluded, "Our goal has been to differentiateJones in the $66 Billion CSD category, and the addition ofpurecane sugar helps achieve this goal by providing our customerswith an indulgence that has a better taste, perceived benefits,positive perceptions, and by providing our retail partners with aclear reason to carry ourproducts ". [Emphasis added.]

27. On March 8, 2007, the Company issued a press release entitled "Jones Soda Co.

Announces Record Fourth Quarter and 2006 Year-End Financial Results." Therein, the

Company, in relevant part, stated:

• Fourth Quarter Revenues Increased 15% to $10.0 Million

• Fiscal Year 2006 Revenues Increased 16.5% to $39.0 Million

• Fiscal Year Earnings before interest and taxes increased 111%

• Fourth Quarter EPS of $0.08 vs. $0.03

Jones Soda Co. (the "Company" or "Jones") today announcedfinancial results for the fourth quarter and fiscal year endedDecember 31, 2006.

Fourth Quarter Highlights

• Revenue increased 15% to $10.0 million compared to $8.8million a year ago

• Earnings before interest and taxes increased 179% to $1.7m

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• Net income increased 256% to $2.1 million versus $0.6 millionlast year

• Diluted earnings per share rose 167% to $0.08 compared to$0.03 a year ago.

Fiscal 2006 Highlights

• Revenue increased 16.5% to $39.0 million versus $33.5 millionin 2005

• Earnings before interest and taxes increased 111% to $2.7m

• Net income increased 257% to $4. 6 million from $1 . 3 millionlast year

• Diluted earnings per share rose 217% to $0.19 compared to$0.06 a year ago

***

Mr. van Stolk continued, "Fiscal 2006 was marked by theexecution of several important initiatives that have significantlyenhanced our growth prospects, further differentiated our brandfrom the competition, and set the stage for an exciting 2007.Foremost, we signed a distribution and manufacturingagreement with National Beverage Corp. for 12 oz. Jones Sodaand 16 oz Jones Energy cans for the U.S. marketplace. After thesuccessful launch during 2005 and 2006for ourfirst ever line ofcans exclusively at Target, we are excited to go after a muchlarger piece of the $66 billion CSD category. Additionally, wemade the strategic decision to sweeten our new cans with purecane sugar rather than high fructose corn syrup, which ispredominately used throughout the industry. Not only does thisprovide our consumers a healthier alternative, it sets Jones Sodaapart from the other beverage companies. We are optimistic aboutthe opportunities we believe our new Jones Pure Cane Soda willprovide, and we have already secured more than 25% ACVthrough shelfspace at major retailers ".

Mr. van Stolk concluded, "We are very pleased with our overallperformance in fiscal 2006. Financially, we increased revenuesmore than 16% and drove an earnings per share gain of 217%. Atthe same time, we successfully raised $30 million to help fund ourfuture growth. Operationally, we continued to gain shelf spacewithin our DTR relationships, increased our geographicpenetration through our DSD business, and prepared for the launch

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of our 24C vitamin drink mix into the marketplace. We alsoupgraded our operating platform with the addition of keypersonnel to better support both our core businesses as well asour new 12 oz can venture. Strategically , we once again providedconsumers with unique, limited edition Jones Soda products, suchas our Valentines Day, Thanksgiving and 10th Anniversary HotWheels collectors' packs . Over the past 12 months we havestrengthened our foundation, increased our brand equity, andfurther evolved our strategy, as we continue our transformationfrom a small player in a niche market into the premium name inthe beverage industry. We move forward with a powerfulportfolio of branded products that we believe will allow us todeliver long-term growth and profitability and increasedshareholder value. " [Emphasis added.]

28. Also on March 8, 2007, Jones Soda held an earnings conference call with

investors and financial analysts. During this call, Defendants van Stolk and Natha, in relevant

part, stated:

[VAN STOLK]: As I stated on our last call , the company has beenfocused on the introduction of the Jones 12-ounce can and thesubsequent sale of Jones concentrate. The selling ofconcentrate inthe beverage industry represents a very positive shift from ourprevious model The concentrate model is a proven model thatallows brands to expand at a much faster rate.

Jones Soda intends to utilize this model to become the premiumcarbonated soft drink or CSD sold in North America. Thisquarter represents the transition into a much larger market ofcarbonated softdrinks and we are very excited with the positiveimpacts on our earnings.

***

Fiscal 2006 was filled with a number of significantaccomplishments for Jones Soda. Financially, revenues increasedmore than 16% to $39 million. Gross margin was up 460 basispoints to 39.2% and diluted EPS grew over 200% to $0.19 pershare versus $0.06 last year. In addition, we successfully raised$30 million in a private placement, which we intend to use to fundour future growth plans.

Strategically, 2006 was marked by several important initiatives putin place, particularly in the back half of the year, aimed at

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increasing our growth prospects and providing our company withan enhanced platform on which to aggressively grow our business.

First and foremost, we secured a distribution and manufacturingagreement with National Beverage Corp., for the 12-ounce Jonessoda and 16-ounce Jones energy can for the entire U. S.marketplace. This agreement ensures we have the ability tosupply our new retail customers in 2007 as National Beverage hascommitted to producing over 35 million cases of productionannually and we intend to work with National to increase thatnumber.

***

With these strategic moves completed, we are now ideallypositioned to significantly transform our company from a nicheplayer in the $500 million premium soda category to a premiumbrand within the significantly larger $66 billion carbonated softdrink market.

As you all know, Target has been a great partner for Jones Sodaand the introduction of 12-ounce cans. Jones has worked withTarget on many exclusive projects in 2006 and we are excited tocontinue our relationship in 2007 and beyond with Jones PureCane Soda. Jones Pure Cane Soda will be launched throughout theUnited States market in the first and second quarter of 2007, withthe majority of resets completed in the second quarter.

To put our opportunity in perspective, Target representedapproximately 2% of the ACV or all commodity volume. By thisMemorial Day, we will have achieved over 25% ACV throughshelf space at these great retailers -- Target, WinCo, CostcoSouthern California, all Safeway stores, all Kroger stores, all K-Mart stores, all Wal-Mart Super Centers, all A&P, all HarrisTeeter stores, all Shaw's, all Pathmark, ShopRite Supermarkets,all Albertson 's intermountain division, all Albertson 's Floridadivision, all Albertson 's Denver division, all Jewell 's, all Railey'sand Associated Food stores.

The stores are in the process of being set and will be completedby Memorial Day. The initial results from these retailers that havetaken the product early are encouraging and exciting, despite thefact that it is still winter in most of North America. This,obviously, bodes well as we get ready for all the importantupcoming summer selling seasons.

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Looking ahead, we'll be looking to add additional retailersduring the course ofthis year and in next in order to achieve ourgoal of ending 2007 with over 30% ACV and exceeding 50% bythe year-end, 2008.

***

After a decade in which we developed and established the JonesSoda brand as a leader in the premium soda category and createdstrong emotional connections with our target consumers throughinnovative grassroots marketing programs and unique packaging,this past year we began to take the necessary steps towardsevolving our business in order to take this company to the nextlevel.

In 2006 we continued to diversifyour operations and created newvehicles of growth -- namely, the full-scale introduction of our12-ounce Jones Pure Cane Soda can. This new business ispositively transforming our business model and changing theface ofour company.

To highlights its initial impact, I point out to our case sales for2006. As Hassan mentioned, case sales for the year increased to5.1 million cases to 2.5 million the year before. Or to put it anotherway, we sold over 120 million units versus 60 million in 2005.And the majority of the year-over-year increase came from ourconcentrate sales late in the fourth quarter.

Looking at 2007, National Beverage has already committed tosupplying 35 million cases of cans for the U.S. market. Toreiterate, we currently have 25% ACV penetration to the listedaccounts I mentioned earlier and we are committed to increasingthat number to 30% by the year end and over 50% within 24months.

Consumers are trading up to premium brands and it's our goal tomake Jones Pure Cane Soda the premium brand in the $66 billionCSD category.

***

[ANALYST]: ... Peter, you, of course, went through the retailersin your introduction there . Could you just mention those brieflyagain? It happened kind of quickly. Could you go through thoseagain, very quickly?

[VAN STOLK]: Sure . I'd be happy to.

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[ANALYST]: Thanks.

[VAN STOLK]: Let mejustpull out the sheet, because there's somany ofthem. I'd like to start with saying that we are going to bein Target, WinCo, Costco Southern California, all ofSafeway, allofKroger, all K-Mart, all Wal-Mart Super Centers, all A&P, allHarris Teeter, all Shaw's, all Pathmarks, all ShopRiteSupermarkets, Albertson's intermountain division, Albertson'sFlorida division, Albertson's Denver division, all Jewell stores,all Railey's stores and the Associated Foods stores.

***

[ANALYST]: ... On the promotional expense, you mentioned thaton the DSD side the promotional expense is coming down and thatis because you're probably negotiating with the retailers to getleverage of that, so it's kind of offsetting . So what kind ofpromotional expenses are we going to see in 2007? It's like mostlydone for the ACV you are targeting or is it still-- there's a lot ofthings to come in '07?

[NATHA]: Well, we are in the front stages of the year 2007. Wehave started shipping our- our cans in the middle of-- from themiddle of January onwards and we'll be fully set by MemorialDay.

***

[ANALYST]: ... Should I assume that -- that those places that Isee it that you haven't listed are trialing it or they haven't agreed tocarry it throughout the whole chain or how do you-- how do you--how would you expect to look at that?

[VAN STOLK]: Well, what I've got positioned was what I've gotcommitments for and I feel comfortable in and there are newchains adding every day.

[ANALYST]: Wegmans, I'm talking about.

[VAN STOLK]: Yes. So the chains that you're looking at, we'readding new chains every day. That list that you - is a list that wefinalized about 3 weeks ago and made a list that we were going togo out with that one.

So that list has expanded as, obviously, things are expanding ona daily basis. That being said, we will continue to provide updateson quarterly calls as we identify them.

15

So if we've missed anybody, we're sorry and we'll make sure thatthey're updated, but they're -- they're going forward and we'regrowing quickly. So we're not holding anybody back, we're justlocking a time and space that this is when we announce the datesand we know we add them to the next one.

***

[ANALYST]: Okay. And have the cans been in any stores longenough to get any kind of sales comparison, any kind of evenweekly data, perhaps? I mean, I noticed it in, like, some places it'sbeen for a while , like Costco or WinCo. Any of those have any--any kind of numbers that you've messed with?

[VAN STOLK]: Yes. We have numbers, but they would be toopremature to tell . I can say that we are extremely excited with theresults that we've seen.

***

[ANALYST]: Good. How's it going?

[VAN STOLK]: It's going well.

[ANALYST]: Congratulations on getting to the 25% ACV.

[VAN STOLK]: Thank you.

[ANALYST]: I guess what I was wondering was you're kind oftargeting the 50% over the course of the next few years and it sureseems like to got to 25% pretty fast. So does that mean that youkind of went after the big guys first to get to 25% and now it'sgoing to be the smaller accounts that will build up to that 50%? Iguess I'm just wondering if it's going to be more difficult from hereto grow your ACV number?

[VAN STOLK]: No, I do not think it's going to be more difficult togrow our ACV numbers, because I think if the brand proves itselfin these retailers , and becomes a more significant player with thepure cane offering, I think -- I think we -- as I stated in the call, Ibelieve that consumers are looking for a choice and retailers likechoices and right now, if a retailer wants to sell a canned soda withpure cane sugar, there's one choice . [Emphasis added.]

29. On April 2, 2007, the Company issued a press release entitled "Jones Soda

Launches Traditional 12 Ounce Bottled Soda Sweetened With Pure Cane Sugar." Therein, the

16

Company, in relevant part, stated:

Jones Soda Co. (the "Company" or "Jones Soda"), todayannounced that it has launched its 12 ounce bottled soda sweetenedwith pure cane sugar.

In conjunction with the national launch of the Jones Soda 12ounce can, the Company outlined a strategy to convert thesweetener in all its Jones Soda products to pure cane sugarfromhigh fructose corn syrup (HFCS). Pure cane sugar is a naturalingredient as opposed to HFCS which is food and drink additive.The entire Jones Soda full-sugar line is now branded Jones PureCane Soda and is available in single 12 ounce glass bottles and4-Packs as well as 12 ounce cans. Jones Pure Cane Soda isunique in the alternative beverage category as the only nationalbrand sweetened with pure cane sugar.

***

Mr. van Stolk concluded, "Jones Soda bottles have always held apremium presence in the marketplace and we believe this transitionto pure cane sugar will further solidify our leadership position as aresult of the better taste, enhanced health benefits, and positiveperception of this new beverage line. We are committed tocontinuing to introduce unique and compelling products thatresonate with our consumers, attract new customers to the brand,and increase our penetration of the overall soda category."[Emphasis added.]

30. On May 3, 2007, the Company issued a press release entitled "Jones Soda Co.

Announces First Quarter Fiscal 2007 Financial Results." Therein, the Company, in relevant part,

stated:

Jones Soda Co. (the "Company" or "Jones") today announcedfinancial results for the first quarter ended March 31, 2007.

***

Peter van Stolk, President and CEO stated, "During the firstquarter we worked hard to prepare for the full launch of ourJones Soda 12-ounce cans while at the same time increase thepenetration of our bottled business at retail Sales of 1,124,000cases (288 ounce equivalent) of concentrate during the quartercontributed to meaningful gross margin expansion. However,this expansion was offset by additional investments in our

17

infrastructure, primarily sales personnel and increasedcompliance costs (Audit and Sarbanes Oxley) to support ouraggressive expansion plans coupled with several newpromotional programs aimed at heightening our brandawareness. As we head into the key summer selling season, weare excited about the recent introduction of Jones Soda PureCane in bottles which along with our Pure Cane 12-ounce cansoffer consumers a healthier alternative andprovide our companysignificant growth opportunities into thefuture. "

Revenue for the first quarter of 2007 increased 4.9% to$9.2 million compared to $8.8 million in the first quarter of 2006.Gross margin for the first quarter increased to 38.3% versus 35.6%in the first quarter of the prior year. Operating expenses as apercentage of sales for the first quarter increased to 44.5% from36.7% in the corresponding period in the prior year. Earningsbefore interest income and taxes decreased to a loss of $427,784compared to income of $44,832 in the prior year. The companyreported a net income of $58,312, or $0.00 per diluted share,compared to net income of $2,542, or $0.00 in the first quarterended March 31, 2006.

"We are very pleased to achieve more than 25% ACV in such ashort period of time and we are committed to expanding ournational presence throughout the remainder of this year andbeyond, " continued Mr. van Stolle "Jones Soda 12-ounce cansare now available across the country at major retailers includingWal-Mart, Sam's Clubs, Albertson, Safeway and Target to namea few. Importantly, we have successfully leveraged ourrelationships to secure additional distribution for our bottles withmany of the aforementioned accounts and we will continue tofocus on executing similar agreements for our entire portfolio ofproducts. "

Mr. van Stolk concluded, "Our brand equity and recognitioncontinue to expand as we diversifyour business, increase ourmarketing and advertising, and broaden our geographic reach.After several years as a leader in the premium soda category wehave made tremendous progress over the past 12-monthstransforming our Company through exciting new and uniqueproduct offerings in order to target the much larger carbonatedsoftdrink market. While it is still early we are optimistic aboutour prospects as we believe we are just now beginning to scratchthe surface in terms of ourfull potential We move forward witha strong management team and an entire organization dedicatedto delivering long-term growth and profitability and increasedshareholder value." [Emphasis added.]

18

31. Also on May 3, 2007, Jones Soda held an earnings conference call with investors

and financial analysts. During this call, Defendants van Stolk and Natha, in relevant part, stated:

[VAN STOLK]: ... With respect to our 12-ounce Jones Sodacans, we are on track to achieve our goal of 25% ACV byMemorial Day with full completion by the end of the secondquarter.

***

As we stated on our last call, we have signed a number of highprofile retailers to carry our new Jones Soda 12-ounce cans, andthis includes Target, WinCo, Costco Southern California,Safeway, Kroger, Kmart, Wal-Mart Supercenters, A&P, HarrisTeeter, Pathmark, ShopRite, Albertson Intermountain, Florida,Albertsons Denver division, Jewel's, Raley and Associated FoodStores and many others. The shelving process at many of theseaccounts has begun. While it's still early and temperature inmany parts of the country have been well below normal, theinitial feedback we have received from retailers has been verypositive, which bodes well as we approach the key summerseason.

***

To reiterate our goal , it's to be in 30% ACV at the end of 2007 and50% by the end of 2008 . We are currently working on theintroduction of pure cane cola and a premium diet cola. These twoflavors have been requested by our retail partners . The introductionof the cola will be an important event in our Company, and we willlaunch these flavors at the start of the third quarter.

***

[VAN STOLK]: ... We have signed more distributors on in Aprilthan we've ever signed on before, and we're growing thatbusiness. That's part of the growth of April because we're justputting on more and more DSD distributors. We now havesolidified our relationship and our strategy with our DSD partnersto completely communicating what products we are going directwith and what products will be DSD. That is an importantpart ofour strategy goingforward because now they know what they cansell, and we know what- the cans are going to selL That's reallyalso helped us goingforward

***

19

[NATHA]: And you know -- we've always known that MemorialDay is the start of the beverage selling season. So a lot of theretailers are setting shelves prior to that, and that's the opportunetime for beverage companies -for us to be able to set shelves.And then they start taking the inventory at that time for beveragesales throughout the summer. It's sort of the beverage cycle rightnow in the marketplace that we're seeing.

[ANALYST]: ... You don't want to give detailed, granularguidance. But, obviously, people are wondering right now withthe back half of Q2 on what numbers are going to look like withthe first quarter coming in where it came in. I know MemorialDay being the day we all need to look at. Can you just comment -- Obviously, you said 50% over last year. That implies you guysstillfeel comfortable with the numbers. Is that a fair statement?

[NATHA]: That is a fair statement.

***

[ANALYST]: ... Just to make sure I've got this correct, you'reguiding for-- you're suggesting your goal for '07 is for revenue gainof 50% over '06 . Is that correct?

[NATHA]: That is correct . [Emphasis added.]

32. The statements contained in 1124 - 31 were materially false and misleading when

made because defendants failed to disclose or indicate the following: (1) that the Company had

experienced significant production and distribution delays in the national rollout of its canned

products; (2) that the Company lacked the necessary personnel to launch its national rollout of

canned products; (3) that the Company had failed to secure adequate retail shelf space for its

canned products in advance of the Memorial Day holiday weekend, the start of the beverage

selling season ; (4) as such, the Company's canned products would not be widely available for

sale in major retail chains in time to capitalize on the Memorial Day holiday weekend sales

opportunity; (5) that the planned national rollout of the Company's canned products had failed to

achieve internal expectations or targets ; (6) that the Company would be forced to cancel its

advertising planned for the Memorial Day holiday weekend; (7) that Starbucks had intended to

20

discontinue sales of the Company's products ; and (8) that, as a result of the foregoing, the

Company's statements about its future business operations and prospects were lacking in a

reasonable basis when made.

The Truth Begins to Emerge

33. On August 2, 2007, the Company shocked investors when it issued a press release

entitled "Jones Soda Co. Announces Second Quarter Fiscal 2007 Financial Results." Therein,

the Company, in relevant part, stated:

Jones Soda Co. (the "Company" or "Jones") today announcedfinancial results for the second quarter ended June 30, 2007.

Second Quarter Review

• Total case sales of 1,722,795 cases (288 ounce equivalent)compared to 961,000 cases a year ago

• Revenue increased 29.8% to $13.0 million compared to $10.0million a year ago

• Gross margin decreased to 34.2% versus 38.0% last year

• Diluted earnings per share were $0.00 compared to $0.10 ayear ago

Peter van Stolk, President and CEO stated, "Although oursecond quarter revenues increased by approximately 30% drivenby a double digit sales gain in our core bottle business, ourconcentrate sales were below plan due to some delays in thelaunch ofour CSD product which negatively impacted our grossmargin and profitability. While we are disappointed in the initialrollout of our Jones Soda cans we are focused on bettermanaging our CSD manufacturing and distribution process andwe remain optimistic about the many long-term growth prospectsofthis business. "

***

"We are pleased to have secured distribution in more than 15,000new retail locations in a relatively short period of time.Importantly, these new relationships have resulted in increaseddistribution for our bottles, including shelf space at Wal-Mart and

21

Sam's Clubs, which contributed to the segment's recent strongperformance," Mr. van Stolk commented. "Looking ahead, we arecommitted to improving the execution of our CSD business acrossthe board. At the same time, we are in the process of building astronger organization that will ensure we are well positioned tocapitalize on the many growth opportunities that we believe existfor our expanding portfolio of brands and products. We remainconfident in our ability to capture meaningful market share of the$70 billion carbonated soft drink industry and to drive increasedprofitability in the years ahead." [Emphasis added.]

34. Also on August 2, 2007, Jones Soda held an earnings conference call with

investors and financial analysts. During this call, the Individual Defendants, in relevant part,

revealed:

[VAN STOLK]: ... We have been targeting Memorial Day as thedate of achieving 25% ACV from our Jones Soda cans; however,we didn 't reach our targeted penetration until July. As a result,we did not experience a level offill in business we were originallymodeling in the second quarter.

***

First, we completely changed our DSD sales organization inorder to improve our retail and distributor relationships to bettermaximize our opportunity. Since joining the Company in earlyApril as the Executive Vice President of Sales and Marketing PeterBurns has made a number of significant changes to the sales teamthat we believe will produce both near and long-term benefits,beginning with the addition of five new divisional Vice Presidentsin each of our DSD regions. The entire team is very focused onbroadening our distributor relations and driving increased volumeof our core soda bottle as well as 24C through the broaderdistribution and additional shelf space in each of our key markets.

***

[NATHA]: ... The Company reported net income of $40,000 or$0.0 per fully diluted share compared to net income of $2.3million or $0.10 per fully diluted share for comparable period in2006.

***

22

That being said, our stated goal was to achieve 25% ACV byMemorial Day and given the timing issues related to the lateshelving ofthe CSDproduct and the slower than planned launchof the concentrate, we have modified our internal plan forrevenue growth in 2007 to between 30% to 40% versus ourprevious internal goal of 50% top line growth for this year, theyear 2007.

***

[VAN STOLK]: ... As we head into the back half of the year andlook out to 2008 and beyond, we remain very confident in ourability to execute our business plan and capitalize on the fullpotential of our brands and operating model. While our secondquarter results came in below plan, we believe the delay in thenational rollout of Jones Soda cans which caused a shortfallwere primarily of one time in nature and our growth strategycontinues to be sound. The CSD segment provides Jones with thegreatest opportunity for profit and growth.

***

[ANALYST]: I guess just going back to this concentrate rollout.I'm trying to get a handle on what exactly happened in thequarter and maybe if we take a look at it on a month by monthbasis just by to figure out what you meant by delayed rollout andI'm assuming that just means it wasn 't quite up to plan in Apriland May and slowly started to get on track as the quarter wenton. And as it relates to that you had documented some issues withKroger in terms of getting the product on the shelf. So has thatbeen taken care ofand what were the issues there?

[VAN STOLK]: Sure . I think it' s -- as we said, our goal was tohave Memorial Day. As Memorial Day came, that has a lot offunction to do with the retailer when their timing and setting andour goal is to set by that day and start the selling period sayMemorial Day and move on. Unfortunately that did not occur.

***

[ANALYST]: ... I asked this question and I want to be veryrespectful . I asked this question two years ago and I'd love to ask itagain. Just simplistically, when are you going to make money?

[VAN STOLK]: I think we made money last year and we intend tomake money going forward, Geoff. I just think to have to launchJones Soda in target with one sales person at a lower cost to theshareholders and launching Target and 24 launching Jones Soda to

23

25% of the ACV and there is an expense that has to do it. Eitheryou pay for it in the front half or eventually you have to pay for it.It's not unrealistic to say that one person can service 15,000retailers and provide execution at a level that you would findrespectable for the shareholders and the results you would expect.Thank being said, we don't have to blow our brains out but youhire five guys versus one and you average salaries -- you knowwhat that is. And expense and all the things. You're going to haveto pay for those people. Those people have to pay for themselves.That's really the question. [Emphasis added.]

35. On this news, the Company's shares declined $3.95 per share, or over 25.8

percent, to close on August 3, 2007 at $11.35 per share, on unusually heavy trading volume.

36. Also on August 3, 2007, the Associated Press published an article entitled "Jones

Soda Shares Fizzle." The article, in relevant part, stated:

Jones Soda Shares Slide on 2Q Earnings and Lower-Than-Expected Concentrate Sales

Jones Soda shares dropped Friday after the premium soda makerreported second quarter earnings below Wall Street's expectationson disappointing sales of its new canned soft drinks.

Shares dropped $3.28, or 21.4 percent, to $12.02 in afternoontrading.

After the market closed Thursday, Jones Soda said profit fell 98percent due to higherpromotional costs and a delay in the rolloutofthe company's new canned sodas.

Previously, Jones Soda packaged its drinks in glass bottles. But thecompany announced a switch to cans earlier this year. The switchto cans helped the company grow its list of retailers, since somestores will not stock the glass bottles.

But the delay of the rollout at some of the company's newretailers depressed sales in the quarter.

ThinkEquity Partners analyst James Maher said in a note toinvestors that sales grew "far less than we expected."

"The delay in resetting retailers' shelves with Jones Pure CaneSoda sharply reduced reorders during the quarter," Maher said.

***

24

Longbow Research analyst Alton Stump said he was alsodisappointed in the concentrate sales and said recent "channelchecks" of several major retailers reported mixed results for JonesSoda's cans.

"Looking longer term, on one hand we still believe Jones Soda'slaunch of cans nationwide could represent an impressive growthopportunity, owing primarily to the attractive 35 percent-plusoperating margins offered by Jones Soda cans to retailers," he saidin a client note. "However, we refrain from taking a positive viewon the shares given fairly disappointing results under JonesSoda 's can launch to date." [Emphasis added.]

PLAINTIFF'S CLASS ACTION ALLEGATIONS

37. Plaintiff brings this action as a class action pursuant to Federal Rule of Civil

Procedure 23(a) and (b)(3) on behalf of a Class, consisting of all those who purchased Jones

Soda's securities between November 1, 2006 and August 2, 2007, inclusive (the "Class Period")

and who were damaged thereby. Excluded from the Class are defendants, the officers and

directors of the Company, at all relevant times, members of their immediate families and their

legal representatives , heirs, successors or assigns and any entity in which defendants have or had

a controlling interest.

38. The members of the Class are so numerous that joinder of all members is

impracticable. Throughout the Class Period, Jones Soda's securities were actively traded on the

NASDAQ. While the exact number of Class members is unknown to Plaintiff at this time and

can only be ascertained through appropriate discovery, Plaintiff believes that there are hundreds

or thousands of members in the proposed Class. Record owners and other members of the Class

may be identified from records maintained by Jones Soda or, its transfer agent and may be

notified of the pendency of this action by mail, using the form of notice similar to that

customarily used in securities class actions.

25

39. Plaintiffs claims are typical of the claims of the members of the Class as all

members of the Class are similarly affected by defendants' wrongful conduct in violation of

federal law that is complained of herein.

40. Plaintiff will fairly and adequately protect the interests of the members of the

Class and has retained counsel competent and experienced in class and securities litigation.

41. Common questions of law and fact exist as to all members of the Class and

predominate over any questions solely affecting individual members of the Class. Among the

questions of law and fact common to the Class are:

(a) whether the federal securities laws were violated by defendants' acts as

alleged herein;

(b) whether statements made by defendants to the investing public during the

Class Period misrepresented material facts about the business, operations

and management of Jones Soda; and

(c) to what extent the members of the Class have sustained damages and the

proper measure of damages.

42. A class action is superior to all other available methods for the fair and efficient

adjudication of this controversy since joinder of all members is impracticable. Furthermore, as

the damages suffered by individual Class members may be relatively small, the expense and

burden of individual litigation make it impossible for members of the Class to individually

redress the wrongs done to them. There will be no difficulty in the management of this action as

a class action.

26

UNDISCLOSED ADVERSE FACTS

43. The market for Jones Soda's securities was open, well-developed and efficient at

all relevant times. As a result of these materially false and misleading statements, and failures to

disclose, Jones Soda's securities traded at artificially inflated prices during the Class Period.

Plaintiff and other members of the Class purchased or otherwise acquired Jones Soda's securities

relying upon the integrity of the market price of Jones Soda's securities and market information

relating to Jones Soda, and have been damaged thereby.

44. During the Class Period, defendants materially misled the investing public,

thereby inflating the price of Jones Soda's securities , by publicly issuing false and misleading

statements and omitting to disclose material facts necessary to make defendants' statements, as

set forth herein, not false and misleading. Said statements and omissions were materially false

and misleading in that they failed to disclose material adverse information and misrepresented

the truth about the Company, its business and operations , as alleged herein.

45. At all relevant times , the material misrepresentations and omissions particularized

in this Complaint directly or proximately caused or were a substantial contributing cause of the

damages sustained by Plaintiff and other members of the Class. As described herein, during the

Class Period, defendants made or caused to be made a series of materially false or misleading

statements about Jones Soda's financial well-being and prospects. These material misstatements

and omissions had the cause and effect of creating in the market an unrealistically positive

assessment of Jones Soda and its financial well-being and prospects, thus causing the Company's

securities to be overvalued and artificially inflated at all relevant times. Defendants' materially

false and misleading statements during the Class Period resulted in Plaintiff and other members

of the Class purchasing the Company's securities at artificially inflated prices, thus causing the

27

damages complained of herein.

LOSS CAUSATION

46. Defendants' wrongful conduct, as alleged herein, directly and proximately caused

the economic loss suffered by Plaintiff and the Class.

47. During the Class Period, Plaintiff and the Class purchased Jones Soda's securities

at artificially inflated prices and were damaged thereby. The price of Jones Soda's securities

significantly declined when the misrepresentations made to the market, and/or the information

alleged herein to have been concealed from the market, and/or the effects thereof, were revealed,

causing investors' losses.

SCIENTER ALLEGATIONS

48. As alleged herein, defendants acted with scienter in that defendants knew that the

public documents and statements issued or disseminated in the name of the Company were

materially false and misleading; knew that such statements or documents would be issued or

disseminated to the investing public; and knowingly and substantially participated or acquiesced

in the issuance or dissemination of such statements or documents as primary violations of the

federal securities laws. As set forth elsewhere herein in detail, defendants, by virtue of their

receipt of information reflecting the true facts regarding Jones Soda, their control over, and/or

receipt and/or modification of Jones Soda's allegedly materially misleading misstatements and/or

their associations with the Company which made them privy to confidential proprietary

information concerning Jones Soda, participated in the fraudulent scheme alleged herein.

49. Additionally, during the Class Period, and with the Company's securities trading

at artificially inflated prices, Company insiders sold 333,000 shares of the Company's stock for

gross proceeds of $6,550,599, including over $2. 5 million in gross proceeds received by

28

Defendant Van Stolk. This trading by Company insiders is evidenced by the following chart:

Date of Trade Inside Trader Number of

Shares

Price per

Share

Gross

Proceeds

June 5, 2007 Gallagher, John J. 20,000 $17.80 $356,000

May 24, 2007 Jones, Stephen C. 15,000 $22.05 $330,750

May 9, 2007 Rossow, Alfred W. 30,000 $23.16 $694,800

May 8, 2007 Fleming, Mick 35,000 $23.78 $832,300

May 8, 2007 Fleming, Mick 5,000 $23.78 $118,900

March 16, 2007 Bedbury, Scott 40,000 $18.46 - $18.79 $745,000

March 15, 2007 Nilsen, Lars P. 3,000 $18.90 $56,699

March 14, 2007 Van Stolk, Peter 140,000 $18.10 $2,534,000

March 13, 2007 Fleming, Mick 15,000 $19.87 $298,050

March 13, 2007 Bedbury, Scott 30,000 $19.47 $584,100

TOTAL: 333,000

Shares

$6,550,599

Gross Proceeds

Applicability of Presumption of Reliance:Fraud On The Market Doctrine

50. At all relevant times , the market for Jones Soda's securities was an efficient

market for the following reasons, among others:

(a) Jones Soda's securities met the requirements for listing, and were listed

and actively traded on the NASDAQ, a highly efficient and automated

market;

(b) As a regulated issuer, Jones Soda filed periodic public reports with the

SEC and the NASDAQ;

(c) Jones Soda regularly communicated with public investors via established

market communication mechanisms, including through regular

disseminations of press releases on the national circuits of major newswire

29

services and through other wide-ranging public disclosures, such as

communications with the financial press and other similar reporting

services; and

(d) Jones Soda was followed by several securities analysts employed by major

brokerage firms who wrote reports which were distributed to the sales

force and certain customers of their respective brokerage firms. Each of

these reports was publicly available and entered the public marketplace.

51. As a result of the foregoing, the market for Jones Soda's securities promptly

digested current information regarding Jones Soda from all publicly-available sources and

reflected such information in the price of Jones Soda's securities. Under these circumstances, all

purchasers of Jones Soda's securities during the Class Period suffered similar injury through their

purchase of Jones Soda's securities at artificially inflated prices and a presumption of reliance

applies.

NO SAFE HARBOR

52. The statutory safe harbor provided for forward-looking statements under certain

circumstances does not apply to any of the allegedly false statements pleaded in this Complaint.

Many of the specific statements pleaded herein were not identified as "forward-looking

statements" when made. To the extent there were any forward-looking statements, there were no

meaningful cautionary statements identifying important factors that could cause actual results to

differ materially from those in the purportedly forward-looking statements . Alternatively, to the

extent that the statutory safe harbor does apply to any forward-looking statements pleaded

herein, defendants are liable for those false forward-looking statements because at the time each

of those forward-looking statements was made, the particular speaker knew that the particular

30

forward-looking statement was false , and/or the forward-looking statement was authorized

and/or approved by an executive officer of Jones Soda who knew that those statements were

false when made.

FIRST CLAIMViolation of Section 10(b) of

The Exchange Act and Rule 10b-5Promulgated Thereunder Against All Defendants

53. Plaintiff repeats and realleges each and every allegation contained above as if

fully set forth herein.

54. During the Class Period, defendants carried out a plan, scheme and course of

conduct which was intended to and, throughout the Class Period, did: (i) deceive the investing

public, including Plaintiff and other Class members, as alleged herein; and (ii) cause Plaintiff and

other members of the Class to purchase Jones Soda's securities at artificially inflated prices. In

furtherance of this unlawful scheme, plan and course of conduct, defendants, and each of them,

took the actions set forth herein.

55. Defendants (i) employed devices, schemes, and artifices to defraud; (ii) made

untrue statements of material fact and/or omitted to state material facts necessary to make the

statements not misleading; and (iii) engaged in acts, practices, and a course of business which

operated as a fraud and deceit upon the purchasers of the Company's securities in an effort to

maintain artificially high market prices for Jones Soda's securities in violation of Section 10(b)

of the Exchange Act and Rule lOb-5. All defendants are sued either as primary participants in

the wrongful and illegal conduct charged herein or as controlling persons as alleged below.

56. Defendants, individually and in concert, directly and indirectly, by the use, means

or instrumentalities of interstate commerce and/or of the mails, engaged and participated in a

continuous course of conduct to conceal adverse material information about Jones Soda's

31

financial well-being and prospects, as specified herein.

57. These defendants employed devices, schemes and artifices to defraud, while in

possession of material adverse non-public information and engaged in acts, practices, and a

course of conduct as alleged herein in an effort to assure investors of Jones Soda's value and

performance and continued substantial growth, which included the making of, or the

participation in the making of, untrue statements of material facts and omitting to state material

facts necessary in order to make the statements made about Jones Soda and its business

operations and future prospects in light of the circumstances under which they were made, not

misleading, as set forth more particularly herein, and engaged in transactions, practices and a

course of business which operated as a fraud and deceit upon the purchasers of Jones Soda's

securities during the Class Period.

58. Each of the Individual Defendants' primary liability, and controlling person

liability, arises from the following facts: (i) the Individual Defendants were high-level executives

and/or directors at the Company during the Class Period and members of the Company's

management team or had control thereof; (ii) each of these defendants, by virtue of their

responsibilities and activities as a senior officer and/or director of the Company, was privy to and

participated in the creation, development and reporting of the Company' s internal budgets, plans,

projections and/or reports; (iii) each of these defendants enjoyed significant personal contact and

familiarity with the other defendants and was advised of, and had access to , other members of the

Company's management team, internal reports and other data and information about the

Company's finances, operations, and sales at all relevant times; and (iv) each of these defendants

was aware of the Company's dissemination of information to the investing public which they

knew or recklessly disregarded was materially false and misleading.

32

59. The defendants had actual knowledge of the misrepresentations and omissions of

material facts set forth herein, or acted with reckless disregard for the truth in that they failed to

ascertain and to disclose such facts, even though such facts were available to them. Such

defendants' material misrepresentations and/or omissions were done knowingly or recklessly and

for the purpose and effect of concealing Jones Soda's financial well-being and prospects from the

investing public and supporting the artificially inflated price of its securities. As demonstrated

by defendants' overstatements and misstatements of the Company's financial well-being and

prospects throughout the Class Period, defendants, if they did not have actual knowledge of the

misrepresentations and omissions alleged, were reckless in failing to obtain such knowledge by

deliberately refraining from taking those steps necessary to discover whether those statements

were false or misleading.

60. As a result of the dissemination of the materially false and misleading information

and failure to disclose material facts, as set forth above, the market price of Jones Soda's

securities was artificially inflated during the Class Period. In ignorance of the fact that market

prices of Jones Soda's securities were artificially inflated, and relying directly or indirectly on the

false and misleading statements made by defendants, or upon the integrity of the market in which

the securities trades, and/or in the absence of material adverse information that was known to or

recklessly disregarded by defendants, but not disclosed in public statements by defendants during

the Class Period, Plaintiff and the other members of the Class acquired Jones Soda's securities

during the Class Period at artificially high prices and were damaged thereby.

61. At the time of said misrepresentations and omissions, Plaintiff and other members

of the Class were ignorant of their falsity, and believed them to be true. Had Plaintiff and the

other members of the Class and the marketplace known the truth regarding the problems that

33

Jones Soda was experiencing , which were not disclosed by defendants, Plaintiff and other

members of the Class would not have purchased or otherwise acquired their Jones Soda's

securities, or, if they had acquired such securities during the Class Period, they would not have

done so at the artificially inflated prices which they paid.

62. By virtue of the foregoing, defendants have violated Section 10(b) of the

Exchange Act and Rule I Ob-5 promulgated thereunder.

63. As a direct and proximate result of defendants' wrongful conduct, Plaintiff and the

other members of the Class suffered damages in connection with their respective purchases and

sales of the Company's securities during the Class Period.

SECOND CLAIMViolation of Section 20(a) of

The Exchange Act Against the Individual Defendants

64. Plaintiff repeats and realleges each and every allegation contained above as if

fully set forth herein.

65. The Individual Defendants acted as controlling persons of Jones Soda within the

meaning of Section 20(a) of the Exchange Act as alleged herein. By virtue of their high-level

positions, and their ownership and contractual rights, participation in and/or awareness of the

Company's operations and/or intimate knowledge of the false financial statements filed by the

Company with the SEC and disseminated to the investing public, the Individual Defendants had

the power to influence and control and did influence and control, directly or indirectly, the

decision-making of the Company, including the content and dissemination of the various

statements which Plaintiff contends are false and misleading. The Individual Defendants were

provided with or had unlimited access to copies of the Company's reports, press releases , public

filings and other statements alleged by Plaintiff to be misleading prior to and/or shortly after

34

these statements were issued and had the ability to prevent the issuance of the statements or

cause the statements to be corrected.

66. In particular, each of these defendants had direct and supervisory involvement in

the day-to-day operations of the Company and, therefore, is presumed to have had the power to

control or influence the particular transactions giving rise to the securities violations as alleged

herein, and exercised the same.

67. As set forth above, Jones Soda and the Individual Defendants each violated

Section 10(b) and Rule 1 Ob-5 by their acts and omissions as alleged in this Complaint. By virtue

of their positions as controlling persons , the Individual Defendants are liable pursuant to Section

20(a) of the Exchange Act. As a direct and proximate result of defendants' wrongful conduct,

Plaintiff and other members of the Class suffered damages in connection with their purchases of

the Company's securities during the Class Period.

WHEREFORE, Plaintiff prays for relief and judgment, as follows:

(a) Determining that this action is a proper class action under Rule 23 of the

Federal Rules of Civil Procedure;

(b) Awarding compensatory damages in favor of Plaintiff and the other Class

members against all defendants, jointly and severally, for all damages

sustained as a result of defendants' wrongdoing, in an amount to be proven

at trial, including interest thereon;

(c) Awarding Plaintiff and the Class their reasonable costs and expenses

incurred in this action, including counsel fees and expert fees; and

(d) Such other and further relief as the Court may deem just and proper.

35

JURY TRIAL DEMANDED

Plaintiff hereby demands a trial by jury.

Dated:

By:

Respectfully submitted,

SCHIFFRIN BARROWAYTOPAZ & KESSLER, LLPRichard A. ManiskasD. Seamus Kaskela280 King of Prussia Rd.Radnor, PA 19087(610) 667-7706(610) 667-7056 (fax)

Attorneys for Plaintiff

36