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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): October 29, 2004
LIFEWAY FOODS, INC.
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(Exact name of registrant as specified in its charter)
ILLINOIS 0-17363 36-3442829
(State or other jurisdiction (Commission File Number) (I.R.S. Employer
of incorporation) Identification No.)
6431 West Oakton St.
Morton Grove, IL 60053
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(Address of principal executive offices, zip code)
Registrant's telephone number, including area code: (847) 967-1010
N/A
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(Former name or former address, if changed since last report)
[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
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LIFEWAY FOODS, INC.
ITEM 1.01. ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT
On October 29, 2004, Lifeway Foods, Inc. ("Lifeway") and Danone Foods, Inc.
("Danone") entered into a Second Extension of Stockholders' Agreement dated as
of October 29, 2004 (the "Second Extension"). The Second Extension is a further
amendment of that certain Stockholders' Agreement dated as of October 1, 1999
between Lifeway, Danone, Michael Smolyansky, Ludmila Smolyansky, Julie
Smolyansky and Edward Smolyansky, as amended on December 24, 1999 (the
"Stockholders' Agreement") and as previously extended by that certain Extension
to Stockholders' Agreement dated as of September 28, 2004 (the "First
Extension"). The Stockholders' Agreement was previously disclosed as Exhibit No.
10.11 to the Current Report on Form 8-K filed by Lifeway on October 12, 1999 and
the First Extension was previously disclosed as Exhibit 10.1 to the Current
Report on Form 8-K filed by Lifeway on October 18, 2004.
Under the Stockholders' Agreement, Danone has the right to nominate one Lifeway
director, anti-dilutive rights relating to future offerings of securities by
Lifeway and limited registration rights. The Stockholders' Agreement also
provides that neither Lifeway nor Danone would compete with each other for a
period of five years with respect to certain dairy products (the "Noncompetition
Provision") and that Danone may not own more than 20% of the outstanding common
stock of Lifeway as a result of direct or indirect acquisition of shares for a
period of five years (the "Standstill Provision"). Danone's interest as of the
date hereof is approximately 20.4% due to reductions in Lifeway's shares
outstanding, primarily due to share repurchases.
Under the First Extension, the terms of the Noncompetition and Standstill
Provisions of the Stockholders' Agreement were due to expire on October 29,
2004. The Second Extension amends the Stockholders' Agreement to extend the
terms of the Noncompetition Provision and of the Standstill Provision through
December 31, 2004. During the term of the Second Extension, Lifeway and Danone
intend to discuss the possibility of a further extension to these provisions as
well as potential other amendments to the Stockholders' Agreement.
ITEM 9.01. FINANCIAL STATEMENTS AND EXHIBITS
(c) Exhibits. The following exhibits are filed with this report:
Exhibit 10.1 Second Extension of Stockholders' Agreement dated
as of October 29, 2004 between Lifeway Foods, Inc.
and Danone Foods, Inc.
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended,
the Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
Dated: November 4, 2004
LIFEWAY FOODS, INC.
By: /s/ Julie Smolyansky
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Julie Smolyansky
Chief Executive Officer, Chief Financial
and Accounting Officer, President,
Treasurer and Director