AG˹ٷ

STOCK TITAN

Edward and Ludmila Smolyansky Provide Update on the Definitive Consent Solicitation Process Currently Underway and Respond to Lifeway Foods, Inc. (NASDAQ: LWAY)

Rhea-AI Impact
(Moderate)
Rhea-AI Sentiment
(Negative)
Tags

Edward and Ludmila Smolyansky, who control approximately 26% of Lifeway Foods (NASDAQ: LWAY) shares, provided an update on their consent solicitation process initiated on July 2, 2025. The Smolyanskys are challenging the current Board's actions and seeking shareholder support to remove the existing board.

A key controversy emerged when Lead Independent Director Jason Scher sold 24,566 of his 24,567 shares at $24.23 per share, seemingly contradicting the Board's stance that Danone's $27 per share offer "severely undervalues" the company. This sale appears to violate the company's director stock ownership policy, which requires directors to maintain shares valued at 200% of their annual retainer.

The Board has claimed the consent solicitation is legally deficient, though the Smolyanskys note their formal request for a record date and shareholder list from June 17 remains unfulfilled.

Edward e Ludmila Smolyansky, che controllano circa il 26% delle azioni di Lifeway Foods (NASDAQ: LWAY), hanno fornito un aggiornamento sul processo di sollecitazione del consenso avviato il 2 luglio 2025. I Smolyansky stanno contestando le azioni dell'attuale Consiglio di Amministrazione e cercano il sostegno degli azionisti per rimuovere il consiglio esistente.

Una controversia chiave è emersa quando il Direttore Indipendente Principale Jason Scher ha venduto 24.566 delle sue 24.567 azioni a 24,23$ per azione, apparentemente in contraddizione con la posizione del Consiglio secondo cui l'offerta di Danone di 27$ per azione "sottovaluta gravemente" la società. Questa vendita sembra violare la politica di proprietà azionaria per i direttori della società, che richiede ai direttori di mantenere azioni per un valore pari al 200% del loro compenso annuale.

Il Consiglio ha affermato che la sollecitazione del consenso è legalmente carente, anche se i Smolyansky sottolineano che la loro richiesta formale di una data di registrazione e dell'elenco degli azionisti del 17 giugno non è ancora stata soddisfatta.

Edward y Ludmila Smolyansky, que controlan aproximadamente el 26% de las acciones de Lifeway Foods (NASDAQ: LWAY), proporcionaron una actualización sobre su proceso de solicitud de consentimiento iniciado el 2 de julio de 2025. Los Smolyansky están desafiando las acciones del actual Consejo y buscan el apoyo de los accionistas para destituir al consejo existente.

Una controversia clave surgió cuando el Director Independiente Principal Jason Scher vendió 24,566 de sus 24,567 acciones a 24.23$ por acción, aparentemente contradiciendo la postura del Consejo de que la oferta de Danone de 27$ por acción "subvalora gravemente" a la empresa. Esta venta parece violar la política de propiedad de acciones para directores de la empresa, que requiere que los directores mantengan acciones valoradas en el 200% de su retención anual.

El Consejo ha afirmado que la solicitud de consentimiento es legalmente deficiente, aunque los Smolyansky señalan que su solicitud formal para una fecha de registro y lista de accionistas del 17 de junio sigue sin cumplirse.

에드워드와 루드밀� 스몰랸스�Lifeway Foods (NASDAQ: LWAY)� � 26%� 주식� 보유하고 있으�, 2025� 7� 2일에 시작� 동의 요청 절차� 대� 최신 정보� 제공했습니다. 스몰랸스� 부부� 현재 이사회의 조치� 이의� 제기하며 기존 이사회를 해임하기 위해 주주들의 지지� 구하� 있습니다.

중요� 논란은 수석 독립 이사 제이� 셰어가 보유� 24,567� � 24,566주를 주당 24.23달러� 매각하면� 발생했�, 이 다논� 주당 27달러 제안� 회사� "심각하게 저평가"한다� 이사회의 입장� 상반되 행동으로 보입니다. � 매각은 이사들이 연간 보수� 200%� 해당하 주식� 유지해야 한다� 회사� 이사 주식 보유 정책� 위반� 것으� 보입니다.

이사회 동의 요청� 법적으로 결함� 있다� 주장했지�, 스몰랸스� 부부� 6� 17� 기준일과 주주 명부� 대� 공식 요청� 아직 이행되지 않았다고 지적했습니�.

Edward et Ludmila Smolyansky, qui contrôlent environ 26% des actions de Lifeway Foods (NASDAQ : LWAY), ont donné une mise à jour sur leur processus de sollicitation de consentement lancé le 2 juillet 2025. Les Smolyansky contestent les actions du conseil d'administration actuel et cherchent le soutien des actionnaires pour destituer le conseil en place.

Une controverse majeure est apparue lorsque le directeur indépendant principal Jason Scher a vendu 24 566 de ses 24 567 actions à 24,23$ par action, ce qui semble contredire la position du conseil selon laquelle l'offre de Danone de 27$ par action "sous-évalue gravement" l'entreprise. Cette vente semble violer la politique de détention d'actions des administrateurs, qui exige que les administrateurs conservent des actions d'une valeur équivalente à 200% de leur rémunération annuelle.

Le conseil a affirmé que la sollicitation de consentement est juridiquement défaillante, bien que les Smolyansky soulignent que leur demande formelle d'une date d'enregistrement et d'une liste des actionnaires du 17 juin reste sans réponse.

Edward und Ludmila Smolyansky, die etwa 26% der Aktien von Lifeway Foods (NASDAQ: LWAY) kontrollieren, gaben ein Update zu ihrem am 2. Juli 2025 gestarteten Zustimmungsersuchen-Prozess. Die Smolyanskys stellen die Handlungen des aktuellen Vorstands infrage und suchen die Unterstützung der Aktionäre, um den bestehenden Vorstand abzusetzen.

Eine zentrale Kontroverse entstand, als Lead Independent Director Jason Scher 24.566 seiner 24.567 Aktien zu je 24,23$ verkaufte, was scheinbar der Haltung des Vorstands widerspricht, dass Danones Angebot von 27$ pro Aktie das Unternehmen "stark unterbewertet". Dieser Verkauf scheint gegen die Aktienbesitzrichtlinie für Direktoren des Unternehmens zu verstoßen, die von den Direktoren verlangt, Aktien im Wert von 200% ihrer jährlichen Vergütung zu halten.

Der Vorstand behauptet, das Zustimmungsersuchen sei rechtlich mangelhaft, während die Smolyanskys darauf hinweisen, dass ihre formelle Anfrage nach einem Stichtag und einer Aktionärsliste vom 17. Juni bisher nicht erfüllt wurde.

Positive
  • Smolyanskys control significant 26% voting stake in the company
  • Danone's $27 per share offer represents potential premium over current trading price
Negative
  • Lead Director sold 99.99% of his shares below the Danone offer price
  • Board's apparent resistance to shareholder communication and transparency
  • Potential violation of director stock ownership policy
  • Delayed 2025 annual meeting

Insights

Significant shareholder activism at Lifeway with 26% owners challenging board amid Danone's potential acquisition offer, creating governance crisis.

This press release reveals a serious corporate governance battle at Lifeway Foods. The Smolyanskys, controlling 26% of voting shares, have launched a formal consent solicitation to remove the entire board of directors. This is no ordinary proxy fight - the timing and tactics indicate a deeply dysfunctional governance situation. The conflict centers on a takeover bid from Danone at $27 per share that the current board rejected as undervaluing the company.

What's particularly troubling from a governance perspective is the lead independent director Jason Scher's decision to sell virtually all his shares (24,566 of 24,567) at $24.23 per share, netting approximately $600,000 - significantly below Danone's rejected offer price. This action directly contradicts both the board's public position on company valuation and appears to violate Lifeway's own director stock ownership requirements, which mandate holdings at 200% of annual retainer.

The situation is further complicated by the board's postponement of the 2025 annual meeting and apparent refusal to provide requested shareholder information or set a record date for the consent process. These defensive tactics suggest entrenchment rather than proper fiduciary conduct. In the broader context of M&A governance, this case exemplifies the conflicts that can arise between incumbent boards and significant shareholders regarding company valuation and acquisition proposals. The outcome of this consent solicitation will likely determine whether shareholders will have the opportunity to consider Danone's acquisition offer.

Shareholder rebellion threatens to derail board's rejection of Danone's $27/share offer; director's share sales undermine board's valuation stance.

The Smolyansky family's consent solicitation represents a critical juncture in what appears to be an unfolding M&A situation involving Lifeway Foods and Danone. This shareholder revolt is directly tied to the board's rejection of Danone's $27 per share acquisition offer, which the current board claimed "severely undervalues" the company. What makes this situation particularly unusual is that we have a lead independent director (Jason Scher) selling virtually his entire stake at $24.23 per share - 10.3% below the offer the board rejected as inadequate.

This dramatic divergence between the board's public stance and a key director's private actions suggests potential governance issues affecting the M&A process. The implementation of a poison pill (mentioned but not detailed in the release) further indicates the current board is taking defensive measures against both the Danone offer and the Smolyansky challenge.

From a deal perspective, the Smolyanskys' 26% voting bloc represents a substantial counterweight to the current board. If successful in their consent solicitation, they could install directors more receptive to Danone's offer or potentially negotiate improved terms. The postponement of the annual meeting also suggests the current board is buying time, possibly to explore alternative transactions or implement defensive strategies.

This situation illustrates a classic agency problem in contested M&A scenarios - when boards' interests potentially diverge from shareholders'. The director's substantial share sales at below-offer prices raises legitimate questions about whether the board genuinely believes its own public statements regarding company valuation.

CHICAGO, July 11, 2025 /PRNewswire/ -- Edward and Ludmila Smolyansky, long-term shareholders of Lifeway Foods, Inc. (NASDAQ: LWAY) who together exercise voting control with respect to approximately 26% of the outstanding shares of Lifeway Foods, today provided an update on the consent solicitation process launched through the filing of a definitive Consent Statement with the U.S. Securities and Exchange Commission (SEC) on July 2, 2025.

Consent Solicitation Gains Momentum

"Our outreach program is fully underway, as momentum continues to build behind our consent solicitation," stated the Smolyanskys. "We are encouraged by the positive response from fellow shareholders who share our concerns about the current Board's actions."

Response to Lifeway Foods

On July 3, 2025, the Company issued a press release stating its view that the consent solicitation is legally deficient because the public filing of the Consent Statement does not constitute adequate notice to shareholders, and because the Board has not set a record date. The Company further "urged" shareholders to "disregard the Smolyanskys' recent filings�"

However, the Company failed to acknowledge that both a record date and a shareholder list were formally requested by Mr. Smolyansky in a letter dated June 17, 2025—a request that remains unfulfilled.

Mr. Smolyansky responded:

"Predictably, the Board is seeking to suppress shareholders and avoid accountability yet again. Regardless of which side they support, all shareholders should be offended that their directors, having already postponed the Company's 2025 annual meeting, are apparently planning to challenge our written consent based on their own failures to act. Shareholders do not need further evidence that this Board will never respond toLifeway's shareholders until it is forced to do so under law, and we ask all shareholders to help us achieve that goal by signing and returning the WHITE consent card, as described in our definitive consent statement."

Board Actions Contradict Own Statements

Even more concerning, recent securities filings suggest that Board leadership does not believe the Board's own statements in a prior press release that Danone's $27 per share offer "severely undervalues the Company," which it has used as justification to adopt a poison pill.

Jason Scher, the lead independent director and Chairperson of the Audit and Corporate Governance Committee, sold 24,566 of his 24,567 shares for nearly $600,000 at an average share price of $24.23. His Form 4 filings over the last two weeks indicate he now owns only a single common share ofLifeway Foods. These sales appear to violate the Company's director stock ownership and holding policy, which requires that Mr.Scher hold Lifeway shares valued at 200% of his annual retainer. Edward and Ludmila Smolyansky call on the Board to address why this does not violate its policy, and how Mr. Scher's sales are consistent with the Board's purported view that Danone's offer undervalues the Company.

Mr. Smolyansky reacted:

"Director Scher selling nearly all of his shares last week is a very troubling indicator about what the Board plans for the Company and what impact those plans will have on the stock price," Mr. Smolyansky stated. "How can shareholders trust Board members who are divesting their own holdings while telling us to reject a $27 per share offer they claim 'severely undervalues' the Company?"

Call to Action

Edward and Ludmila Smolyansky request that shareholders execute and return WHITE consent cards, in accordance with the instructions in their definitive consent statement. For more information and to contact the shareholder group, visit and.

Important Information

This communication is not a request for a proxy to vote on, or shareholder consent with respect to, any matter. Any written solicitation of a proxy or shareholder consent by Mr. Smolyansky or Mrs. Smolyansky will be made through a definitive proxy statement or definitive consent statement, including thedefinitive consent statement filed by them with the SEC on July 2, 2025(the "Consent Statement"). Lifeway shareholders are urged to read the Consent Statement, including any amendments or supplements thereto, and any other soliciting materials, when they become available as they will contain important information. Shareholders may obtain, free of charge, copies of the Consent Statement and other relevant documents at sec.gov.

Participants in the Solicitation

Mr. Smolyansky and Mrs. Smolyansky filed the Consent Statement with the SEC on July 2, 2025, which relates to, among other matters, their intent to seek shareholder consents to remove Lifeway's current board of directors and elect each of Ludmila Smolyansky, Edward Smolyansky, Richard Beleutz, Cindy Curry, Michael Leydervuder, George Sent, and Robert Whalen (each, a "Nominee") as directors of Lifeway. In addition, Mr. Smolyansky filed apreliminary proxy statement with the SEC on April 16, 2025, relating to his intent to nominate each Nominee for election as directors of Lifeway at its 2025 annual meeting of shareholders. Each Nominee may be deemed to have an interest in any solicitation of written consents or proxies by Mr. Smolyansky and Mrs. Smolyansky, as applicable.

The participants (the "Participants") in any solicitation of shareholder consents or proxies by Mr. Smolyansky or Mrs. Smolyansky may be deemed to be Mr. Smolyansky, Mrs. Smolyansky and each of the other Nominees. Lifeway shareholders can obtain information regarding the Participants and their direct and indirect interests, by security holdings or otherwise, in Appendix B to the Consent Statement, which information is incorporated herein by reference.

Cision View original content:

SOURCE Edward and Ludmila Smolyansky

FAQ

What percentage of Lifeway Foods (LWAY) shares do the Smolyanskys control?

Edward and Ludmila Smolyansky exercise voting control over approximately 26% of the outstanding shares of Lifeway Foods.

What is the Danone offer price for Lifeway Foods (LWAY)?

Danone made an offer of $27 per share, which the current Board claims 'severely undervalues' the company.

How many shares did Lead Director Jason Scher sell in Lifeway Foods (LWAY)?

Jason Scher sold 24,566 of his 24,567 shares at an average price of $24.23 per share, retaining only one share.

When did the Smolyanskys file their definitive Consent Statement for Lifeway Foods?

The Smolyanskys filed their definitive Consent Statement with the SEC on July 2, 2025.

What are the Smolyanskys trying to achieve with their consent solicitation at Lifeway Foods?

They are seeking shareholder support to remove the current Board of Directors and elect seven new directors, including themselves and five other nominees.
Lifeway Food

NASDAQ:LWAY

LWAY Rankings

LWAY Latest News

LWAY Latest SEC Filings

LWAY Stock Data

388.29M
5.25M
66.68%
22.8%
1.71%
Packaged Foods
Dairy Products
United States
MORTON GROVE