Pulse Beverage Corp. (fka PLSB)

[Jeff-M]

- Pulse Sees Strong Performance for 2nd Half of 2014 as it Continues to Roll-out Natural Cabana® Coconut Water Domestically and into Mexico

DENVER, Aug. 14, 2014 /PRNewswire/ -- The Pulse Beverage Corporation (OTCQB: PLSB), makers of Natural Cabana® Lemonades, Limeades and Coconut Waters, and PULSE® Heart & Body Health functional beverages, today issued the following letter to shareholders from Bob Yates, Chief Executive Officer.

Dear Fellow Shareholders:

I would like to take this opportunity to share the progress we have made thus far and provide a detailed layout of our near term objectives.

In the United States the first quarter was one of the coldest, harshest winters in many decades, expectedly impacting sales of lemonade and retailers across the country as delivery trucks throughout the Northeast and Midwest were literally frozen in their tracks. Despite the environmental challenges endured by the overall industry, we remained focused on our planned strategies and spent the second quarter catching up on sales and expanding our growth in Natural Cabana® Coconut Water domestically and set the groundwork to expand into Mexico. In addition, we made a very strategic move to elevate our branding and sales efforts by entering into the multi-billion dollar food service industry.

We achieved significant operational progress during the second quarter that we believe establishes a stronger foundation for the remainder of the year and into 2015. Leading into the very hot summer months, we are seeing a vast improvement in sales across all of our beverage lines. Our lemonades and limeades are performing well and are now being sold in more than 20,000 stores.

Based on the success of our Natural Cabana® Coconut Water roll-out in the U.S. and the lack of premium, reasonably priced coconut water available in Mexico, Pulse is establishing a wholly-owned subsidiary in Mexico. Pulse's Mexican venture will be headed by Carlos Villarreal and his team of representatives, collectively Borrega Consulting Inc. ("Borrega"). Borrega is a San Diego based international business development consulting and brokerage firm with expertise in Latin American business development for over 16 years. Mr. Villarreal was responsible for the Mexico introduction and distribution of Monster Energy Drink® in 2004 and led the expansion across all of Mexico up until June 2010. He has worked with leading brands such as Dr. Pepper, Snapple and Miller, among others, in their entry/distribution strategies. He has also served as a Director for Anheuser-Busch and for Grupo Modelo (Corona) in the U.S. and Mexico.

Pulse will be offering our Natural Cabana® Coconut Water in both Natural and Pineapple in 520ml containers for convenience stores and both flavors in smaller 320ml containers for large grocery chains.

We are extremely excited to have Borrega Consulting lead our roll-out into the Mexican beverage market. Their track record in Latin America and the successful roll out of Monster Energy Drink® throughout Mexico provides us with an experienced team and valuable relationships which we believe will help to quickly secure key accounts for coconut water and pave the way for expanding our lemonades and limeades into Mexico. We plan to aggressively pursue this opportunity by securing accounts with large national chain stores including Wal-Mart, Costco and Soriana (totaling more than 3,000 stores) and large national convenience stores such as OXXO and 7-Eleven (totaling more than 13,000 stores).

Earlier this month, we announced our partnership with Smashburger®, the rapidly expanding "better burger" restaurant concept, to sell our Natural Cabana® Lemonade to Smashburger® customers at all 265 Smashburger® locations nationwide. It has been reported by Smashburger® representatives that our lemonade is outselling all other beverages offered. As part of this collaboration, Smashburger® will now be one of Pulse's top food service accounts. This expansion will help accelerate our growth and bolster our presence in a rapidly growing industry with one of the top companies from the "better-burger" category. This demonstrates our ability to not only identify opportunities but also participate in the consumer trends driving the industry, thus generating meaningful value for our shareholders. Deliveries to Smashburger® will be made through SYSCO and The Sygma Network which represent a new channel of distribution into the multi-billion dollar food service industry.

We continued the introduction of what we believe will be an extraordinarily successful new product line, Natural Cabana® Coconut Water, which made its debut in March and is already featured in more than 5,000 stores. This product has been met with outstanding reception and has extremely high potential given that coconut water in the beverage sector has doubled each year since 2005, according to the Wall Street Journal.

I would also like to note that we expect the roll-out of our newly designed and reformulated PULSE® Heart and Body Health functional beverages in September 2014. PULSE® Heart & Body Health is an effective nutritional supplement for those seeking a healthy lifestyle. It is a natural beverage product that is high in antioxidants, selenium, Vitamin C and fiber. It is bottled without preservatives and comes in an eye popping 500ml glass bottle package in three naturally sweetened great tasting flavors: Pomegranate/Blackberry, Pear/Peach and Strawberry/Grapefruit. Pulse® Heart & Body Health contains effective levels of important ingredients to support the health of our heart and cardiovascular and immune system.

All that being said, compared to our 1st quarter, total case sales for our 2nd quarter increased by more than 70,000 cases to more than 125,000 cases, including increasing our coconut water case sales to more than 21,000 cases. We showed stronger growth during May and June and we are now set for a strong second half of 2014. We expect steady growth for our lemonades, limeades and coconut waters during the 3rd quarter as we continue to fulfill orders during the very hot summer months. Full financial results may be accessed in our Form 10Q, filed with the Securities and Exchange Commission at http://www.pulsebeverage.com/sec-filings.

Our net losses to date, for the most part, continues to be the result of a concentrated effort to establish and increase brand awareness; and establish and improve upon our extensive nationwide and international distribution systems. Our net losses are also due to the initial development of our brands including: Natural Cabana® Lemonade and Limeade and Coconut Waters and to secure distribution and chain store listings. We also have spent a great deal of time and incurred a great deal of expense to finish the initial development and then the re-formatting of Pulse® Heart and Body Health functional beverages which is due to be launched this year.

In only a few years since the Company was founded, Pulse is quickly becoming a leader in the beverage industry with excellent tasting products, a highly experienced and skilled management team and a strong distribution network that continues to grow.

With a clear, detailed business plan, we are confident in the delivery and execution of our product launch, continued sales and marketing strategies. As we diversify within the industry, we will continue to strive to be market leaders in the development and marketing of great tasting nutritional beverages.

I thank you for your ongoing support and look forward to updating you in the future. Be sure to try our Natural Cabana® Lemonades and Limeades and our Natural Cabana® Coconut Waters!

Sincerely,

Bob Yates, Chief Executive Office