Core Viewpoint - The company is facing significant governance issues, particularly regarding executive compensation and legal disputes, which have raised concerns among shareholders about the Board's effectiveness and accountability [3][4][6]. Governance and Shareholder Relations - Edward Smolyansky, a significant shareholder, has expressed concerns that the Board is planning to delay the 2025 Annual Meeting of Shareholders beyond the scheduled date of June 2, 2025, which he views as a hostile act towards shareholders [2][3]. - The rejection of Danone's acquisition offer, which was at a significant premium, has led to questions about whether the Board prioritized its own interests over those of shareholders [4]. Executive Compensation - In December 2024, the Board awarded CEO Julie Smolyansky a $2 million retention bonus and a $6.5 million equity grant without providing justification, despite a 20.6% decline in Lifeway's earnings [5]. - The change-in-control severance multiple for Julie Smolyansky was increased from 2x to 3x her base salary, raising further concerns about the Board's compensation practices [5]. Legal and Regulatory Issues - Lifeway has initiated multiple lawsuits against its largest shareholders, which raises questions about governance and the use of shareholder funds [6][8]. - The company has spent over $1 million on legal claims against Edward Smolyansky, with no return for shareholders, highlighting potential mismanagement of resources [8]. Internal Management and Oversight - Lifeway eliminated its internal legal department in January 2020, relying on outside counsel for legal matters, which has incurred high costs for shareholders [9]. - Jason Burdeen, the Chief of Staff and husband of CEO Julie Smolyansky, has taken control over legal matters despite lacking legal qualifications, which raises concerns about the company's governance and compliance [10]. Call for Change - Edward and Ludmila Smolyansky are advocating for immediate action to set a date for the 2025 Annual Meeting and proceed with director elections, emphasizing the need for accountability from the Board [13].
Edward Smolyansky Rebukes Lifeway Foods (NASDAQ: LWAY) 2024 Amended 10-K Filing