Introductory Note
This Amendment No. 5 to Schedule 13D relates to the common stock, no par value (the “Common Stock”), of Lifeway Foods, Inc.,
an Illinois corporation (the “Issuer”), and amends the Schedule 13D filed on October 12, 1999 (the “Initial Filing”), as amended by Amendment No. 1 to Schedule 13D filed on October 29, 1999,
Amendment No. 2 to Schedule 13D filed on November 10, 1999, Amendment No. 3 to Schedule 13D filed on January 5, 2000, and Amendment No. 4 to Schedule 13D filed on September 23, 2024 (the Initial Filing together
with Amendments Nos. 1-4, the “Original Schedule 13D”).
This Amendment No. 5 is being filed
to amend the Original Schedule 13D as follows:
Item 4. Purpose of Transaction.
Item 4 of the Original Schedule 13D is hereby amended and supplemented to add the following:
As reported on Amendment No. 4. to the Original Schedule 13D, on September 23, 2024, Danone North America PBC sent a letter to the Issuer
(the “Initial Proposal”), proposing to acquire all of the outstanding shares of Common Stock not currently held by the Reporting Persons for a purchase price of $25.00 per share, paid in cash (the “Proposed
Transaction”).
On November 5, 2024, the Issuer issued a press release announcing that the Issuer rejected the Initial Proposal and that the
Issuer had adopted a shareholder rights plan in response to the Initial Proposal.
On November 15, 2024, Danone North America PBC sent a second letter to
the Issuer (the “Updated Proposal”) in order to express its disappointment in the Board’s response to the Initial Proposal and reiterate Danone North America PBC’s strong commitment to the Proposed Transaction. In the
Updated Proposal, Danone North America PBC increased the offer for the Proposed Transaction from $25.00 per share to $27.00 per share. The Proposed Transaction would be wholly funded in cash from existing cash reserves of the Reporting Persons and
is not contingent on any financing requirements. The proposal is subject to the completion of due diligence and negotiation of definitive agreements. The foregoing summary of the Updated Proposal is not intended to be complete and is qualified in
its entirety by reference to the full text of the Updated Proposal, which is filed herewith as Exhibit 99.1 and is incorporated herein by reference.
No
assurances can be given that the Proposed Transaction will be consummated. No legally binding obligation with respect to the Proposed Transaction will arise unless and until the relevant parties enter into mutually acceptable definitive
documentation. This Schedule 13D is not an offer to purchase or a solicitation of an offer to sell any securities.
The Reporting Persons intend to
engage in discussions with the Issuer regarding the terms of the Proposed Transaction. The Reporting Persons may change the terms of the Proposed Transaction, determine to accelerate or terminate discussions with the Issuer with respect to the
Proposed Transaction, withdraw the Updated Proposal, or any other proposal with respect to the Proposed Transaction, take any action to facilitate or increase the likelihood of consummation of the Proposed Transaction, or change their intentions
with respect to any such matters, in each case at any time and without prior notice. The Reporting Persons and their subsidiaries will, directly or indirectly, take such additional steps as they may deem appropriate to further the Proposed
Transaction or otherwise to support their investment in the Issuer, including, without limitation: (a) engaging in discussions with other shareholders, potential sources of financing, advisors and other relevant parties; and (b) entering
into confidentiality arrangements, financing commitments, and other agreements, arrangements and understandings in connection with the Proposed Transaction.
The Proposed Transaction and/or any actions related thereto may result in one or more of the actions specified in clauses (a) to (j) of Item 4 of
Schedule 13D, including, without limitation, the acquisition of additional securities of the Issuer, a merger or other extraordinary transaction involving the Issuer, the delisting of the Common Stock from the Nasdaq and the Common Stock becoming
eligible for termination of registration pursuant to
Section 12(g)(4) of the Securities Exchange Act of 1934, as amended.
The Reporting Persons
intend to review their investment in the Issuer on a continuing basis. Depending on various factors, including, without limitation, the outcome of any discussions referenced above, the Issuer’s financial position, results and strategic
direction, actions taken by the Issuer’s management and the Board, price levels of the Common Stock and other investment opportunities available to the Reporting Persons, the Reporting Persons may in the future take such actions with respect to
their investment in the Issuer as they deem appropriate, including, without limitation, acquiring additional Common Stock and/or other equity or other securities of the Issuer or disposing of some or all of the securities beneficially owned by them
in public market or privately negotiated transactions and/or otherwise changing their intention with respect to any and all matters referred to in Item 4 of Schedule 13D.