Edward and Ludmila Smolyansky, long-term shareholders of Lifeway Foods Inc., who together exercise voting control with respect to approximately 23.2% of the outstanding shares of Lifeway Foods, filed a definitive consent statement with the U.S. Securities and Exchange Commission (SEC). The filing initiates a process to remove Lifeway’s current board of directors and elect a new slate of nominees who will be "focused on restoring accountability, transparency, and long-term shareholder value."

The Smolyanskys' are seeking shareholder approval on four proposals: to repeal any bylaw amendments adopted after March 24, 2023; to remove all current directors, to elect a new board of "seven highly qualified nominees who collectively have deep experience in governance, finance, operations, and consumer products;" and to amend Lifeway’s by-laws to prohibit it from employing or engaging any immediate family member of its president or CEO.

“It is apparent to us that the current board has no intent to engage with us. We believe this consent solicitation is the most direct and effective way to return Lifeway to the people who actually own it,” said Edward Smolyansky. “The company’s circumstances demand bold, unprecedented action. We must end entrenched, self-serving control and bring in leadership that will act in the best interests of all shareholders.”

Lifeway Foods issued the following response:

"Lifeway values investor feedback and remains focused on maximizing shareholder value. Lifeway's strategy has delivered strong shareholder returns (788% over five years through the date prior to Danone's initial unsolicited proposal) and financial results (~100% revenue growth from FY '19 through FY '24). We look forward to continuing this momentum for the benefit of all shareholders.

"The Smolyanskys' definitive consent solicitation statement filed on July 2 violates Illinois law and the Company's organizational documents. Their statement purports to set a record date for their proposals, when they don't have a right to do so, and ignores the requirement that all shareholders entitled to vote receive proper notice of the proposed action prior to the taking of any action by written consent, and they have failed to do so. In short, their statement is legally deficient.

"Accordingly, shareholders are urged to disregard the Smolyanskys' recent filing and any communications from them that violate the law and our charter/bylaws."