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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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<SEC-DOCUMENT>0001072613-10-000514.txt : 20100505
<SEC-HEADER>0001072613-10-000514.hdr.sgml : 20100505
<ACCEPTANCE-DATETIME>20100505155222
ACCESSION NUMBER:		0001072613-10-000514
CONFORMED SUBMISSION TYPE:	DEFR14A
PUBLIC DOCUMENT COUNT:		1
FILED AS OF DATE:		20100505
DATE AS OF CHANGE:		20100505
EFFECTIVENESS DATE:		20100505

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			LIFEWAY FOODS INC
		CENTRAL INDEX KEY:			0000814586
		STANDARD INDUSTRIAL CLASSIFICATION:	DAIRY PRODUCTS [2020]
		IRS NUMBER:				363442829
		STATE OF INCORPORATION:			IL
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		DEFR14A
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-17363
		FILM NUMBER:		10801765

	BUSINESS ADDRESS:	
		STREET 1:		6431 W OAKTON
		CITY:			MORTON GROVE
		STATE:			IL
		ZIP:			60053
		BUSINESS PHONE:		7089671010

	MAIL ADDRESS:	
		STREET 1:		6431 W OAKTON
		CITY:			MORTON GROVE
		STATE:			IL
		ZIP:			60053
</SEC-HEADER>
<DOCUMENT>
<TYPE>DEFR14A
<SEQUENCE>1
<FILENAME>proxy_16812.htm
<DESCRIPTION>REVISED DEFINITIVE PROXY STATEMENT
<TEXT>
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    <title>proxy_16812.htm</title>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">UNITED
STATES</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SECURITIES
AND EXCHANGE COMMISSION</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Washington,
D.C. 20549</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 16pt; FONT-FAMILY: Times New Roman">SCHEDULE
14A</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Rule
14a-101)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold">INFORMATION
REQUIRED IN PROXY STATEMENT</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold">SCHEDULE 14A
INFORMATION</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Proxy
Statement Pursuant to Section&#160;14(a) </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-WEIGHT: bold">of the Securities </font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-WEIGHT: bold">Exchange Act of 1934</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(Amendment
No. 1)</font></font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Filed by
the Registrant <font style="DISPLAY: inline;" face="Wingdings">&#254;</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Filed by
a Party other than the Registrant <font style="DISPLAY: inline;" face="Wingdings">o</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Check the
appropriate box:</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="76%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="76%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Preliminary
      Proxy Statement</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="top" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="76%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Confidential,
      for Use of the Commission Only (as permitted by
      Rule&#160;14a-6(e)(2))</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="top" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">&#254;</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="76%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Definitive
      Proxy Statement</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="top" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="76%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Definitive
      Additional Materials</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="top" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="76%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Soliciting
      Material Pursuant to &#167;240.14a-12</font></div>
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      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 17pt; FONT-FAMILY: Times New Roman">LIFEWAY
FOODS, INC.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Name of
Registrant as Specified In Its Charter)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">(Name of
Person(s) Filing Proxy Statement, if other than the Registrant)</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Payment
of Filing Fee (Check the appropriate box):</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="3" valign="top" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">&#254;</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="3" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">No
      fee required.</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="3" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fee
      computed on table below per Exchange Act Rules&#160;14a-6(i)(1) and
      0-11.</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Title
      of each class of securities to which transaction
  applies:</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Aggregate
      number of securities to which transaction applies:</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(3)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Per
      unit price or other underlying value of transaction computed pursuant to
      Exchange Act Rule&#160;0-11 (set forth the amount on which the filing fee
      is calculated and state how it was determined):</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(4)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Proposed
      maximum aggregate value of transaction:</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(5)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total
      fee paid:</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="3" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fee
      paid previously with preliminary materials.</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: wingdings">o</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="3" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Check
      box if any part of the fee is offset as provided by Exchange Act
      Rule&#160;0-11(a)(2) and identify the filing for which the offsetting fee
      was paid previously.&#160;&#160;Identify the previous filing by
      registration statement number, or the Form or Schedule and the date of its
      filing.</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amount
      Previously Paid:</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Form,
      Schedule or Registration Statement No.:</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(3)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Filing
      Party:</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="73%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(4)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="73%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Date
      Filed:</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div>
        <hr style="MARGIN-TOP: -5px; COLOR: #000000" noshade size="1">
        <hr style="MARGIN-TOP: -13px; COLOR: #000000" noshade size="4">
      </div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center">&#160;</div>
        </div>
        <div id="HDR" style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">LIFEWAY
FOODS, INC.</font></div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">6431 W.
OAKTON</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">MORTON
GROVE, IL 60053</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOTICE OF
ANNUAL MEETING OF SHAREHOLDERS TO BE HELD JUNE 17, 2010</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">TO OUR
SHAREHOLDERS:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">You are
invited to be present either in person or by proxy at the Annual Meeting of
Shareholders of Lifeway Foods, Inc., an Illinois corporation (the &#8220;Company&#8221;), to
be held at the Holiday Inn North Shore, 5300 West Touhy Avenue, Skokie, Illinois
60077, on June 17, 2010 at 2:00 p.m. local time (the &#8220;Meeting&#8221;), to consider and
act upon the following:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1.</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      election of six Directors to serve until the next meeting or until their
      successors are duly elected and qualified.</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2.</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      ratification of the appointment of Plante &amp; Moran, PLLC, as
      independent auditors for the next fiscal year.</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3.</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      transaction of such other business as may properly come before the Meeting
      or any adjournments thereof.</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Only
shareholders of Common Stock of record at the close of business on April 23,
2010 will be entitled to notice of and to vote at the Meeting.&#160;&#160;The
stock transfer books of the Company will remain open.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">WE INVITE
EACH OF YOU TO ATTEND THE MEETING.&#160;&#160;WHETHER OR NOT YOU PLAN TO ATTEND
THE MEETING, PLEASE PROMPTLY VOTE YOUR SHARES VIA THE INTERNET OR THE TOLL-FREE
TELEPHONE NUMBER AS DESCRIBED IN THE ENCLOSED MATERIALS.&#160;&#160;IF YOU
RECEIVED A PROXY CARD BY MAIL, PLEASE SIGN, DATE AND RETURN IT IN THE ENVELOPE
PROVIDED.&#160;&#160;IF YOU ATTEND THE MEETING AND VOTE IN PERSON, YOUR VOTE BY
PROXY WILL NOT BE USED. YOU MAY REVOKE YOUR PROXY AT ANY TIME PRIOR TO ITS
EXERCISE, REGARDLESS OF THE MANNER USED TO TRANSMIT YOUR VOTING
INSTRUCTIONS.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="middle" width="39%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="39%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">BY
      ORDER OF THE BOARD OF DIRECTORS</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ludmila
      Smolyansky</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chairperson
      of the Board</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Skokie,
      Illinois</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">May
      6, 2010&#160;</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left">&#160;</div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">2</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">LIFEWAY
FOODS, INC.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PROXY
STATEMENT</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PROCEDURAL
MATTERS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">THIS
PROXY STATEMENT IS FURNISHED TO THE SHAREHOLDERS OF LIFEWAY FOODS, INC., AN
ILLINOIS CORPORATION (THE &#8220;COMPANY&#8221; or &#8220;LIFEWAY&#8221;), IN CONNECTION WITH THE
SOLICITATION OF PROXIES BY AND ON BEHALF OF THE BOARD OF DIRECTORS OF THE
COMPANY TO BE VOTED AT THE ANNUAL MEETING OF SHAREHOLDERS (THE &#8220;MEETING&#8221;) TO BE
HELD AT 2:00 P.M., LOCAL TIME, ON JUNE 17, 2010, OR AT ANY ADJOURNMENT OR
POSTPONEMENT THEREOF.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Shareholders
of record of Common Stock of the Company at the close of business on April 23,
2010 (the &#8220;Record Date&#8221;), will be entitled to notice of and to vote at the
Meeting.&#160;&#160;The Meeting will be held at the Holiday Inn North Shore,
5300 West Touhy Avenue, Skokie, Illinois 60077.&#160;&#160;Proxies received
prior to the Meeting will be voted in accordance with the instructions contained
in the proxy and, if no choice is specified, will be voted in favor of each
nominee for Director named in this Proxy Statement and in favor of each other
proposal set forth in this Proxy Statement.&#160;&#160;A shareholder who votes
by proxy may revoke it at any time before it is voted by a written revocation
delivered to any of the proxy holders named therein, by submitting another valid
proxy bearing a later date or by attending the Meeting and voting in
person.&#160;&#160;Beneficial owners wishing to vote at the Meeting who are not
shareholders of record on the Company&#8217;s books (e.g., persons holding in street
name) must bring to the Meeting a power of attorney or proxy in their favor
signed by the holder of record in order to be able to vote.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SOLICITATION
OF PROXIES</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Our proxy
materials are primarily available to stockholders on the Internet, as permitted
by rules of the U.S.&#160;Securities and Exchange Commission.&#160;&#160;A
Notice of Internet Availability of Proxy Materials is first being mailed to
shareholders beginning approximately May 6, 2010, and this Proxy Statement and
the form of proxy, together with our Annual Report on Form 10-K, are first being
made available to the shareholders beginning approximately May 6, 2010 at <font style="DISPLAY: inline; TEXT-DECORATION: underline">www.proxyvote.com</font>.&#160;&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">All of
the costs and expenses in connection with the solicitation of proxies with
respect to the matters described herein will be borne by the
Company.&#160;&#160;In addition to solicitation of proxies by mail, the
directors, officers and investor relations staff (who will receive no
compensation in addition to their regular remuneration) of the Company named
herein may solicit the return of proxies by telephone, telegram or personal
interview.&#160;&#160;As of this date, the Company has retained Broadridge
Financial Solutions, Inc. (&#8220;Broadridge&#8221;), an outside firm, to solicit proxies
solely from individual shareholders of record and to print proxy notices and
other related materials.&#160;&#160;The services provided by Broadridge to the
Company are expected to cost approximately $6,000.&#160;&#160;The Company has
also retained Automatic Data Processing, Inc. (&#8220;ADP&#8221;), at an approximate cost of
$3,000, to contact banks, brokerage houses and other custodians, nominees and
fiduciaries with requests to forward copies of the proxy materials to their
respective principals and to request instructions for voting the
proxies.&#160;&#160;The expenses of such banks, brokerage houses and other
custodians, nominees and fiduciaries in connection therewith are covered by the
estimated fee to be paid by the Company to ADP.&#160;&#160;Action may be taken
on the business to be transacted at the Meeting on the date specified in the
Notice of Meeting or on any date or dates to which such Meeting may be
adjourned.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">VOTING OF
PROXIES</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">A form of
proxy is provided for use at the Meeting if a shareholder is unable to attend in
person.&#160;&#160;Each proxy may be revoked at any time thereafter by writing
to the Secretary of the Company prior to the Meeting, by execution and delivery
of a subsequent proxy, or by attendance and voting in person at the Meeting,
except as to any matter or matters upon which, prior to such revocation, a vote
shall have been cast pursuant to the authority conferred by such
proxy.&#160;&#160;Shares represented by a valid proxy which if received pursuant
to this solicitation and not revoked before it is exercised, will be voted as
provided on the proxy at the Meeting or at any adjournment or adjournments
thereof.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">3</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">VOTING
SECURITIES AND VOTE REQUIRED</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Only
holders of the 16,717,802 shares of Common Stock, no par value per share, of
record outstanding at the close of business on April 23, 2010, will be entitled
to vote at the Meeting.&#160;&#160;Each holder of Common Stock is entitled to
one vote for each share held by such holder.&#160;&#160;The presence, in person
or by proxy, of the holders of a majority of the outstanding shares of Common
Stock is necessary to constitute a quorum at the Meeting.&#160;&#160;Under the
rules of the Securities and Exchange Commission (the &#8220;SEC&#8221;), boxes and a
designated blank space are provided on the proxy card for shareholders to mark
if they wish to withhold authority to vote for one or more nominees for Director
or for Proposal 2.&#160;&#160;Votes withheld in connection with the election of
one or more of the nominees for Director or Proposal 2 will be counted as votes
cast against such individuals or Proposal 2 and will be counted toward the
presence of a quorum for the transaction of business.&#160;&#160;If no direction
is indicated, the proxy will be voted for the election of the nominees for
Director and for Proposal 2.&#160;&#160;The form of proxy provides for
withholding of votes with respect to the election of Directors and a shareholder
present at the Meeting also may abstain with respect to such
election.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">ANNUAL
REPORT ON FORM 10-K</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company&#8217;s Annual Report on Form 10-K, for the fiscal year ended
December&#160;31, 2009 (the &#8220;Annual Report&#8221;) has been posted along with this
Proxy Statement.&#160;&#160;Shareholders are referred to the Annual Report for
information concerning the Company&#8217;s business and operations, but the Annual
Report is not part of the proxy soliciting materials.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PROPOSAL
1: ELECTION OF DIRECTORS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Six
Directors are to be elected at the Meeting.&#160;&#160;The Company&#8217;s Board has a
maximum number of Directors equal to seven, however the Company has determined
to intentionally keep one seat vacant at this time.&#160;&#160;Directors will be
elected at the Meeting to serve until the next annual meeting of shareholders of
the Company or until each of their successors shall be duly elected and
qualified.&#160;&#160;As noted, unless otherwise indicated thereon, all proxies
received will be voted in favor of the election of each of the six nominees of
the Board named below as Directors of the Company.&#160;&#160;Should any of the
nominees not remain a candidate for election at the date of the Meeting (which
contingency is not now contemplated or foreseen by the Company), proxies
solicited thereunder will be voted in favor of those nominees who do remain
candidates and may be voted for substitute nominees elected by the
Board.&#160;&#160;Each of the nominees is currently serving as a Director of the
Company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">REQUIRED
VOTE</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The six
nominees receiving the highest number of affirmative votes of the shares present
or represented and entitled to be voted for them shall be elected as
Directors.&#160;&#160;Votes withheld from any Director are counted for purposes
of determining the presence or absence of a quorum for the transaction of
business, but have no other legal effect under Illinois
law.&#160;&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">THE BOARD
OF DIRECTORS RECOMMENDS A VOTE TO ELECT THE DIRECTORS NOMINATED HEREIN TO SERVE
AND PROXIES SOLICITED BY THE BOARD WILL BE VOTED IN FAVOR THEREOF UNLESS A
SHAREHOLDER HAS INDICATED OTHERWISE ON THE PROXY.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The names
of the nominees and certain information with regard to each nominee
follows:</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="87%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="bottom" width="30%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="7%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="34%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="bottom" width="30%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">NAME</font></div>
              </td>
              <td align="left" valign="bottom" width="4%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="7%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">AGE</font></div>
              </td>
              <td align="left" valign="bottom" width="4%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="34%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">TITLE</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="top" width="30%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ludmila
      Smolyansky</font></div>
              </td>
              <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">59</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director
      and Chairperson of the Board of Directors</font></div>
              </td>
            </tr><tr bgcolor="white">
              <td align="left" valign="top" width="30%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Julie
      Smolyansky</font></div>
              </td>
              <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">34</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">CEO,
      President, and Director</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="top" width="30%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Pol
      Sikar</font></div>
              </td>
              <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">61</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director</font></div>
              </td>
            </tr><tr bgcolor="white">
              <td align="left" valign="top" width="30%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Renzo
      Bernardi</font></div>
              </td>
              <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">57</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="top" width="30%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Gustavo
      Carlos Valle</font></div>
              </td>
              <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">46</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director</font></div>
              </td>
            </tr><tr bgcolor="white">
              <td align="left" valign="top" width="30%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Julie
      Oberweis</font></div>
              </td>
              <td align="right" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="7%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">35</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="34%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Director</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">4</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOMINEES
FOR ELECTION AS DIRECTORS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">LUDMILA
SMOLYANSKY was appointed as a Director by the Board to fill a vacancy created by
an increase of the maximum number of Directors up to seven and unanimously
elected as the Chairperson of the Board in November&#160;2002.&#160;&#160;For
more than 20&#160;years, Mrs.&#160;Smolyansky has been the operator of several
independent delicatessens, gourmet food distributorship businesses and imported
food distributorships.&#160;&#160;In 2002, prior to the commencement of her
tenure as a Director, she was hired by the Company as its General
Manager.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Mrs.&#160;Smolyansky
devotes as much time as necessary to the business of the Company and currently
holds, and in the past five years has held, no other directorships in any other
reporting company.&#160;&#160;Mrs.&#160;Smolyansky is the mother of Julie
Smolyansky (the President, Chief Executive Officer (CEO), and a Director) and
Edward P. Smolyansky (the Company Treasurer and Chief Financial and Accounting
Officer).</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">JULIE
SMOLYANSKY was appointed as a Director, and elected President, CEO, CFO and
Treasurer of the Company by the Board of Directors to fill the vacancies in
those positions created by the death of her father, Michael Smolyansky, in
June&#160;2002.&#160;&#160;She is a graduate with a Bachelor&#8217;s degree from the
University of Illinois at Chicago.&#160;&#160;Prior to her appointment,
Ms.&#160;Smolyansky spent six years as the Company&#8217;s Director of Sales and
Marketing.&#160;&#160;She currently holds, and in the past five years has held,
no other directorships in any other reporting company.&#160;&#160;Ms. Smolyansky
is the daughter of Ludmila Smolyansky, the Chairperson of the
Board.&#160;&#160;In 2004, Ms.&#160;Smolyansky resigned as CFO and Treasurer and
Edward Smolyansky, Ms.&#160;Smolyansky&#8217;s brother, was appointed to such
positions.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">POL SIKAR
has been a Director of the Company since its inception in
February&#160;1986.&#160;&#160;He is a graduate with a </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Master&#8217;s
degree from the Odessa State Institute of Civil Engineering in
Russia.&#160;&#160;For more than 11&#160;years, he has been President and a
major shareholder of Montrose Glass &amp; Mirror Co., a company providing glass
and mirror products to the wholesale and retail trade in the greater Chicago
area.&#160;&#160;Mr.&#160;Sikar currently holds, and in the past five years has
held, no other directorships in any other reporting company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">RENZO
BERNARDI has been a Director of the Company since
1994.&#160;&#160;Mr.&#160;Bernardi is the president and founder of Renzo &amp;
Sons, Inc., a Dairy and Food Service Company which has been in business since
1969 (formerly, Renzo-Milk Distribution Systems).&#160;&#160;He has over
30&#160;years of experience in the dairy distribution
industry.&#160;&#160;Mr.&#160;Bernardi is a graduate of Instituto Teonico E
Commerciale of Macomer, Sardinia.&#160;&#160;Mr. Bernardi currently holds, and
in the past five years has held, no other directorships in any other reporting
company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">GUSTAVO
CARLOS VALLE has been a Director of the Company since 2009.&#160;&#160;Mr. Valle
is an Argentine citizen and was appointed President and CEO of the Dannon
Company, Inc. effective April 1, 2009.&#160;&#160;Mr. Valle joined Danone
Argentina in 1996 as Vice President Finance where he &#160;became CEO of Danone
Waters Argentina in 2002. &#160;Two years later, he was appointed CEO of Danone
Brazil.&#160;&#160;Mr. Valle graduated in Economics from Buenos Aires University
in Argentina.&#160;&#160;Mr. Valle currently holds, and in the past five years
has held, no other directorships in any other reporting company.&#160;&#160;Mr.
Valle has been designated by DS Waters LP (as the related successor to The
Dannon Company, Inc.) (&#8220;Dannon&#8221;) to be its representative to the Board in
accordance with the terms of that certain Stockholder&#8217;s Agreement, as amended,
between the Company and Dannon.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">JULIE
OBERWEIS has served as a director of the Company since
June&#160;2006.&#160;&#160;In 2002, Ms.&#160;Oberweis co-founded and is the CFO
of Stratigent, LLC, a web analytics consulting company.&#160;&#160;Prior to
Stratigent, she worked in investment consulting at Cambridge Associates as well
as at Ritchie Capital.&#160;&#160;She currently sits on the board of Oberweis
Group, Inc., the holding company of Oberweis Dairy, and the DuPage Childrens
Museum.&#160;&#160;Julie holds a degree in finance from the University of
Illinois and is a Chartered Financial Analyst
(CFA)&#160;charterholder.&#160;&#160;Ms. Oberweis currently holds, and in the
past five years has held, no other directorships in any other reporting
company.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SECTION
16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Section&#160;16(a)
of the Securities and Exchange Act of 1934 requires the Company&#8217;s Officers and
Directors, and persons who own more than 10% of a registered class of the
Company&#8217;s equity securities, to file reports of ownership and changes in
ownership with the SEC.&#160;&#160;Officers, directors, and greater than 10%
shareholders are required by SEC regulations to furnish the Company with copies
of all Section 16(a) forms they file.&#160;&#160;Based solely on its review of
copies of such reports received or representations from certain reporting
persons, the Company believes that, during the year ended December&#160;31,
2009, other than the filings listed below, all other Section 16(a) filing
requirements applicable to its officers, Directors and 10% shareholders were
timely met.&#160;&#160;Those filings were:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Edward
Smolyansky reported one transaction on one Form 4 late, and Renzo Bernardi
reported one transaction on one Form 4 late.</font><br></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">BOARD AND
COMMITTEE MEETINGS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Board
Leadership.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Since
2004, the positions of Chairperson of the Board of the Company and Chief
Executive of the Company have been held by different
individuals.&#160;&#160;Currently, Ludmila Smolyansky serves as Chairperson of
the Board of the Company and Julie Smolyansky as Chief Executive of the
Company.&#160;&#160;These two individuals provide leadership to the Board of
Directors by setting the agenda for Board meetings, preparing information and
alternatives for presentation to the Board and leading discussions among and
facilitating decision making by the Board of Directors.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Board
believes that this structure is appropriate because it results in a balanced
leadership, combining a separate independent Chairperson together with a member
of management involved in the day-to-day operation of the Company&#8217;s
business.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
2009, the Company&#8217;s Board of Directors held five regular meetings (the Company&#8217;s
annual meeting of shareholders and Directors and quarterly
meetings).&#160;&#160;In 2009, four of six Directors attended the Company&#8217;s
annual meeting.&#160;&#160;Each director attended at least 75% of all meetings
of our board of directors and committees on which he or she served that were
held during 2009.&#160;&#160;Shareholders of the Company may send communications
to the Board of Directors via the Company&#8217;s Investor Relations department, which
makes such communications available to the Directors as appropriate, to LIFEWAY
FOODS, INC., 6431 W. OAKTON, MORTON GROVE, IL 60053, telephone
(847)&#160;967-1010, fax (847)&#160;967-6558.&#160;&#160;The Investor Relations
department can be reach via email at: info@lifeway.net.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Board
Committees.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company&#8217;s Audit Committee (the &#8220;Audit Committee&#8221;) consists of Mr.&#160;Sikar and
Ms.&#160;Oberweis, each of whom has an understanding of finance and accounting
and is able to read and understand fundamental financial
statements.&#160;&#160;Audit Committee members are appointed by the full
Board.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
functions of the Audit Committee are to review the Company&#8217;s internal controls,
accounting policies and financial reporting practices; to review the financial
statements, the arrangements for and scope of the independent audit, as well as
the results of the audit engagement; to review the services and fees of the
independent auditors, including pre-approval of non-audit services, the
auditors&#8217; independence; and recommend to the Board of Directors for its approval
and for ratification by the shareholders the engagement of the independent
auditors to serve the following year in examining the accounts of the
Company.&#160;&#160;No member of the Audit Committee is a &#8220;financial expert,&#8221; as
defined in Item&#160;407 of Regulation&#160;S-K.&#160;&#160;The Board examined
the qualifications of its Audit Committee members and determined that the
present members of the Audit Committee were sufficiently capable of performing
the duties of the Audit Committee in 2009 without being &#8220;financial experts&#8221;
within the definition provided in Item&#160;407 of Regulation&#160;S-K
promulgated by the SEC.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Board
of Directors does not have a standing nominating committee, compensation
committee or any committees performing similar functions.&#160;&#160;As there
are only six Directors currently serving on the Board, it is the view of the
Board that all Directors should participate in the process for the nomination
and review of potential Director candidates and for the review of the Company&#8217;s
executive pay practices.&#160;&#160;Accordingly, Julie Smolyansky, Ludmila
Smolyansky, Renzo Bernardi, Pol Sikar, Julie Oberweis and Gustavo Carlos Valle
all participate in the nominating process, in the review of executive employment
contracts and in review of the Company&#8217;s executive compensation practices,
except with respect to their own executive compensation, if
applicable.&#160;&#160;It is the view of the Board that the participation of all
Directors in the duties of nominating and compensation committees ensures not
only as comprehensive as possible a review of Director candidates and executive
compensation, but also that the views of independent, employee, and shareholder
Directors are considered.</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Board
does not have any formal policy regarding the consideration of director
candidates recommended by shareholders; any recommendation would be considered
on an individual basis.&#160;&#160;The Board believes this is appropriate due to
the lack of such recommendations made in the past, and its ability to consider
the establishment of such a policy in the event of an increase of such
recommendations.&#160;&#160;The Board welcomes properly submitted
recommendations from shareholders and would evaluate shareholder nominees in the
same manner that it evaluates a candidate recommended by other
means.&#160;&#160;Shareholders may submit candidate recommendations by mail to
LIFEWAY FOODS, INC., 6431 W. OAKTON, MORTON GROVE, IL 60053.&#160;&#160;With
respect to the evaluation of director nominee candidates, the Board has no
formal requirements or minimum standards for the individuals that it
nominates.&#160;&#160;Rather, the Board considers each candidate on his or her
own merits.&#160;&#160;However, in evaluating candidates, there are a number of
factors that the Board generally views as relevant and is likely to consider,
including the candidate&#8217;s professional experience, his or her understanding of
the business issues affecting the Company, his or her experience in facing
issues generally of the level of sophistication that the Company faces, and his
or her integrity and reputation.&#160;&#160;With respect to the identification
of nominee candidates, the Board has not developed a formalized
process.&#160;&#160;Instead, its members and the Company&#8217;s senior management
have recommended candidates whom they are aware of personally or by
reputation.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
2009 through the date of this Proxy Statement, Ludmila Smolyansky, Julie
Smolyansky and Edward Smolyansky collectively controlled more than 50% of the
voting power of our Common Stock.&#160;&#160;See &#8220;Security Ownership of Certain
Beneficial Owners and Management,&#8221; below.&#160;&#160;Consequently, we are a
&#8220;controlled company&#8221;&#160;</font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">under
applicable Nasdaq rules.&#160;&#160;Under these rules, a &#8220;controlled company&#8221;
may elect not to comply with certain Nasdaq corporate governance requirements,
including requirements that: (i) a majority of the board of directors consist of
independent directors; (ii) director nominees be selected or recommended for
selection by a majority of the independent directors or by a nominating
committee composed solely of independent directors; and (iii) compensation of
officers be determined or recommended to the board of directors by a majority of
its independent directors or by a compensation committee that is composed
entirely of independent directors.&#160;&#160;We have elected to use each of
these exemptions.</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Oversight
of Risk Management.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company&#8217;s management is responsible for assessing and managing Lifeway&#8217;s
exposure to various risks.&#160;&#160;Responsibility for risk oversight by the
Board of Directors lies with the entire Board. Therefore,&#160;&#160;the
responsibility for the administration of this risk oversight lies primarily with
the Board&#8217;s leadership.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Company&#8217;s principal risks exist in the potential for rising milk prices, the
Company&#8217;s primary raw material,&#160;&#160;and from competitors producing
dairy-based probiotic products.&#160;&#160;The Board addresses at least annually
the principal current and future risk exposures of the Company.&#160;&#160;The
Board receives regular reports from members of senior management on areas of
material risk to the Company, including operational, financial, legal and
regulatory, and strategic and reputation risks.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">REPORT OF
THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee assists the Board of Directors in fulfilling its responsibility for
oversight of the quality and integrity of the accounting, auditing, internal
control and financial reporting practices of the Company.&#160;&#160;Currently,
the Audit Committee consists of Mr.&#160;Sikar and Ms.&#160;Oberweis, each of
whom are independent directors in accordance with federal securities laws and
the Nasdaq listing standards.&#160;&#160;These are the Company&#8217;s only
independent directors.&#160;&#160;The Chairperson of the Audit Committee is Mr.
Pol Sikar.&#160;&#160;Each of the Audit Committee members has an understanding
of finance and accounting and is able to read and understand fundamental
financial statements.&#160;&#160;To the extent Company employees are aware of
any financial irregularities, the Audit Committee has been designated to receive
such information in a confidential manner.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee reviewed and discussed the audited financial statements for the fiscal
year ended December&#160;31, 2009 with the Company&#8217;s management and the
independent auditors, Plante &amp; Moran, PLLC
(&#8220;Plante&#8221;).&#160;&#160;Additionally, the Audit Committee discussed with Plante
matters as required by the Statement of Auditing Standards No.&#160;61, which
included Plante&#8217;s judgments as to the quality not just the acceptability of the
financial statements, changes in accounting policies and sensitive accounting
estimates.</font></div>
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      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Plante
provided the Audit Committee with written disclosures and a letter required by
Independence Standards Board Standard No.&#160;1 (&#8220;ISB Standard
No.&#160;1&#8221;).&#160;&#160;ISB Standard No.&#160;1 requires Plante to
(i)&#160;disclose in writing all relationships between Plante and related
entities and the Company and its related entities, in Plante&#8217;s professional
judgment, that may reasonably be thought to bear on independence;
(ii)&#160;confirm that, in Plante&#8217;s professional opinion, they are independent
of the Company within the meaning of the federal securities laws and
(iii)&#160;discuss Plante&#8217;s independence with the Audit
Committee.&#160;&#160;The Audit Committee discussed with Plante its independent
status.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee amended and restated its written charter governing its actions
effective December&#160;17, 2003.&#160;&#160;The Audit Committee reviews and
reassesses the charter annually.&#160;&#160;The Company is required to attach
the charter as an appendix to the Company&#8217;s proxy statement every three years
and last filed the charter with its proxy statement for the 2008 annual
meeting.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Based on
the Audit Committee&#8217;s review of the year-end audited financial statements and
the various discussions noted above, the Audit Committee recommended to the
Board of Directors that the audited financial statements be included in the
Company&#8217;s Annual Report on Form 10-K, as amended, for the fiscal year ended
December&#160;31, 2009.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee:</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Pol
Sikar</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Julie
Oberweis</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AUDIT
COMMITTEE PRE-APPROVAL POLICIES AND PROCEDURES</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee comprised of Mr. Sikar and Ms.&#160;Oberweis pre-approved Plante as
the Company&#8217;s independent auditor for the year ended December&#160;31, 2009 and
has adopted the following guidelines regarding the engagement of the Company&#8217;s
independent auditor to perform services for the Company:</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For audit
services (including statutory audit engagements as required under local country
laws), the independent auditor will provide the Audit Committee with an
engagement letter during the January-March quarter of each year </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">outlining
the scope of the audit services proposed to be performed during the fiscal
year.&#160;&#160;If agreed to by the Audit Committee, this engagement letter
will be formally accepted by the Audit Committee at its first or second quarter
meeting.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
independent auditor will submit to the Audit Committee for approval an audit
services fee proposal after acceptance of the engagement letter.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">For
non-audit services, Company management will submit to the Audit Committee for
approval (during the second or third quarter of each fiscal year) the list of
non-audit services that it recommends the Audit Committee engage the independent
auditor to provide for the fiscal year.&#160;&#160;Company management and the
independent auditor will each confirm to the Audit Committee that each non-audit
service on the list is permissible under all applicable legal
requirements.&#160;&#160;In addition to the list of planned non-audit services,
a budget estimating non-audit service spending for the fiscal year will be
provided.&#160;&#160;The Audit Committee will approve both the list of
permissible non-audit services and the budget for such services.&#160;&#160;The
Audit Committee will be informed routinely as to the non-audit services actually
provided by the independent auditor pursuant to this pre-approval
process.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To ensure
prompt handling of unexpected matters, the Audit Committee delegates to either
member thereof the authority to amend or modify the list of approved permissible
non-audit services and fees.&#160;&#160;Such member will report action taken to
the Audit Committee at the next Audit Committee meeting.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
independent auditor must ensure that all audit and non-audit services provided
to the Company have been approved by the Audit Committee.&#160;&#160;The Chief
Financial Officer is responsible for tracking all independent auditor fees
against the budget for such services and report at least annually to the Audit
Committee.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">8</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">EXECUTIVE
COMPENSATION</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Summary
Compensation Table</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div align="left">
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="bottom" width="23%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Name</font></div>
              </td>
              <td align="left" valign="bottom" width="1%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="3" valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Year</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="3" valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Salary</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="3" valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Bonus</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="3" valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Stock</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Awards
      (5)</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="3" valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">All
      other Comp. (6)</font></div>
              </td>
              <td align="left" valign="bottom" width="2%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="3" valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Julie
      Smolyansky, CEO</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2009</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">390,153</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">50,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">84,762&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">16,926</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">541,841&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">and
      President (1)</font></font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">247,038</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">42,050&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,288</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">329,376&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="bottom" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
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              <td align="left" valign="bottom" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Edward
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              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: center">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2009</font></div>
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              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">467,153</font></div>
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              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
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              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">50,000</font></div>
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              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
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              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
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              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">84,762&#160;
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              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">19,632</font></div>
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              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
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              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">621,547&#160;
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              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chief
      Accounting Officer, </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: center">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">276,884</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">40,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">42,050&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">11,900</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">370,831&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="23%">
                <div><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Treasurer
      and Controller and </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">CEO
      </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">and
      President of Fresh </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Made
      Dairy, Inc. (2)</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            </tr><tr>
              <td align="left" valign="bottom" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ludmila
      Smolyansky,</font></div>
              </td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: center">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2009</font></div>
              </td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
              <td align="left" valign="bottom" width="2%">&#160;</td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">359,926</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="bottom" width="2%">&#160;</td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">60,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%">&#160;</td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8212;&#160;
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                </div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;</font></td>
              <td align="left" valign="bottom" width="2%">&#160;</td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">8,700</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">428,626&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chairman
      (3)</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: center">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">190,076</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">50,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8212;&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="top" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">8,400</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td valign="top" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">248,476&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="bottom" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="9%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="23%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Val
      Nikolenko, Vice President </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: center">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2009</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">124,602</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">8,476&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">15,664</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">168,742&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="23%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">of
      Operations and Secretary (4)</font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="9%" style="TEXT-ALIGN: center">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2008</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">114,035</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">12,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">5,030&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td align="right" valign="bottom" width="9%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">14,021</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;$</font></div>
              </td>
              <td valign="bottom" width="9%" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">145,086&#160;
      </font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">NOTES TO SUMMARY
COMPENSATION TABLE</font></font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" colspan="2" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)</font></div>
              </td>
              <td align="left" colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="top" width="92%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      Board appointed Julie Smolyansky as the CEO, CFO, President and Treasurer
      of the Company on&#160;&#160;June&#160;10,&#160;2002.&#160;&#160;From
      September&#160;21, 1998 until such appointments, she had been Director of
      Sales and Marketing of the&#160;Company.&#160;&#160;Since
      November&#160;2004, Ms.&#160;Smolyansky has served solely as CEO and
      President.</font></div>
              </td>
            </tr><tr>
              <td align="left" colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
              <td align="left" valign="top" width="92%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
            </tr><tr>
              <td align="left" colspan="2" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)</font></div>
              </td>
              <td align="left" colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="92%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      Board appointed Edward Smolyansky as the CFO, Chief Accounting Officer and
      Treasurer of the Company in November&#160;2004.</font></div>
              </td>
            </tr><tr>
              <td align="left" colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="92%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" colspan="2" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(3)</font></div>
              </td>
              <td align="left" colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="92%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      Company approves, on an annual basis, the payment to Ludmila Smolyansky of
      salary and bonus as other compensation for continuing advisory services to
      the Company and in light of her extensive experience.&#160;&#160;Ludmila
      Smolyansky devotes as much time as necessary to the business of the
      Company.</font></div>
              </td>
            </tr><tr>
              <td align="left" colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="92%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" colspan="2" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(4)</font></div>
              </td>
              <td align="left" colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="92%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">The
      Board appointed Val Nikolenko as the Vice President of Operations and
      Secretary of the Company in December&#160;1993.</font></div>
              </td>
            </tr><tr>
              <td align="left" colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" colspan="2" valign="middle" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="92%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" colspan="2" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(5)</font></div>
              </td>
              <td align="left" colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="92%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">On&#160;May
      28, 2009, Lifeway's Board of Directors approved awards of an aggregate
      amount of&#160;18,000 shares to be awarded under its Employee, Consultants
      and Service Providers Benefit Plan to certain key employees and
      consultants for services rendered to the Company.&#160;&#160;The stock
      awards were issued on July 14, 2009 and vest in 12 equal monthly portions
      over one year.</font></div>
              </td>
            </tr><tr>
              <td colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="92%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" colspan="2" valign="top" width="4%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(6)</font></div>
              </td>
              <td align="left" colspan="2" valign="top" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="92%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Represents
      (i) the Company&#8217;s portion of the matching contributions to the Company&#8217;s
      401(k) plan on behalf of the Named Executive Officer, Julie Smolyansky ($0
      for 2009 and $4,500 for 2008); Edward Smolyansky ($8,700 for 2009 and
      $8,100 for 2008); Val Nikolenko ($5,784 for 2009 and $5,041 for 2008) and
      (ii) the following amounts related to personal usage of automobiles leased
      by the Company, and related insurance and fuel, for 2009 and 2008, (x) for
      Julie Smolyansky, $13,126 for 2009 and $11,988 for 2008 of lease payments,
      $2,000 for 2009 and $2,000 for 2008 of insurance premiums and $1,800 for
      2009 and $1,800 for 2008 of fuel, (y) for Edward Smolyansky, $7,132 for
      2009 of lease payments, for 2009 and $2,000 for 2008 of insurance premiums
      and $1,800 for 2009 and $1,800 for 2008 of fuel, and (z) for Val
      Nikolenko, $7,080 for 2009 and $7,080 for 2008 of lease payments, $1,000
      for 2009 and $1,000 for 2008 of insurance premiums and $1,800 for 2009 and
      $1,800 for 2008 of fuel.&#160;</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">9</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Outstanding
Equity Awards At Fiscal Year-End</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="top" width="26%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="2" valign="top" width="52%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline">Stock Awards</font></font></div>
              </td>
            </tr><tr>
              <td valign="bottom" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline">Name</font></font></div>
              </td>
              <td valign="top" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline">Number of Shares or Units of</font></font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline">Stock That Have Not Vested</font></font></div>
              </td>
              <td valign="top" width="26%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline">Market Value of Shares or Units
      of</font></font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline">Stock That Have Not
  Vested</font></font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Julie
      Smolyansky</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,750</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$44,550</font></div>
              </td>
            </tr><tr>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Edward
      Smolyansky</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,750</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$44,500</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ludmila
      Smolyansky</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8212;</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#8212;</font></div>
              </td>
            </tr><tr>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Val
      Nikolenko</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">375</font></div>
              </td>
              <td valign="top" width="26%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$&#160;&#160;4,455</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The terms
of the stock awards are described below under Employee, Consultants and Service
Providers Benefit Plan (the &#8220;Plan&#8221;).</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">Director
Compensation</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="bottom" width="67%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Name</font></div>
              </td>
              <td align="left" valign="bottom" width="5%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="3" valign="bottom" width="12%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Fees
      Earned</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">or</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Paid
      in Cash</font></div>
              </td>
              <td align="left" valign="bottom" width="5%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td colspan="3" valign="bottom" width="11%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Total</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="67%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Pol
      Sikar</font></div>
              </td>
              <td align="left" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="bottom" width="67%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Renzo
      Bernardi</font></div>
              </td>
              <td align="left" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="67%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Julie
      Oberweis</font></div>
              </td>
              <td align="left" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="5%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="right" valign="bottom" width="1%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">$</font></div>
              </td>
              <td align="right" valign="bottom" width="10%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2,000</font></div>
              </td>
              <td align="left" valign="bottom" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
2009, each outside (non-employee) director was compensated at the rate of $500
per non-annual meeting attended.&#160;&#160;Neither any employee director
(Ludmila Smolyansky and Julie Smolyansky) nor any Director serving as the
nominee of Dannon (Juan Carlos Dalto or Gustavo Carlos Valle) was compensated as
a Director during 2009.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As other
compensation for continuing advisory services to the Company, and in light of
her extensive experience, the Company approved the payment to Ludmila Smolyansky
of a salary of $359,926 and a bonus of $60,000 in 2009.&#160;&#160;Ludmila
Smolyansky devotes as much time as necessary to the business of the
Company.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="right"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">EMPLOYMENT
CONTRACTS AND TERMINATION OF EMPLOYMENT AND CHANGE-IN-CONTROL
ARRANGEMENTS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)</font></div>
              </td>
              <td align="left" valign="top" width="74%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">EMPLOYMENT
      CONTRACTS</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Julie
Smolyansky has an employment agreement (the &#8220;Employment Agreement&#8221;) with the
Company pursuant to which she serves as Chief Executive
Officer.&#160;&#160;Pursuant to the Employment Agreement, Ms. Smolyansky is
entitled to an annual base salary and an annual bonus subject to such incentive
bonus targets and plans which the Company may adopt from time to
time.&#160;&#160;The Company has not currently set any such targets in advance
or adopted any such plans.&#160;&#160;In lieu thereof, the Board of Directors
determines Ms.&#160;Smolyansky&#8217;s salary and bonus on an annual basis
concurrently with determining amounts for other executive
officers.&#160;&#160;In the event that (a)&#160;Ms.&#160;Smolyansky is
terminated other than for Cause (as defined therein) or
(b)&#160;Ms.&#160;Smolyansky terminates her employment for Good Reason (as
defined therein) or death, then Ms.&#160;Smolyansky is entitled to a lump sum
payment consisting of (y)&#160;twice her then-current base salary and
(z)&#160;the aggregate of the annual bonus for which she is then eligible under
the Employment Agreement and any such plans.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">There are
no employment agreements with other executive officers (written or
unwritten).</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">10</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)</font></div>
              </td>
              <td align="left" valign="top" width="74%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">EMPLOYEE,
      CONSULTANTS AND SERVICE PROVIDERS BENEFIT
PLAN</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On
June&#160;9, 1995, the Company filed a registration statement on Form S-8 with
the Securities and Exchange Commission in connection with the Plan covering
1,200,000, as adjusted, shares of its Common Stock.&#160;&#160;The Plan was
adopted by the Company on June&#160;5, 1995.&#160;&#160;Pursuant to such Plan,
the Company may issue common stock or options to purchase common stock to
certain consultants, service providers, and employees of the
Company.&#160;&#160;There were a total of approximately 940,000 shares eligible
for issuance under the Plan at December 31, 2009.&#160;&#160;The option price,
number of shares, grant date, and vesting terms are determined at the discretion
of the Company&#8217;s Board of Directors.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">As of
December 31,&#160;2009, there were no stock options outstanding or
exercisable.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">On&#160;May
28, 2009, Lifeway's Board of Directors approved awards of an aggregate amount
of&#160;18,000 shares to be awarded under the Plan to certain key employees and
consultants for services rendered to the Company.&#160; The stock awards were
issued on July 14, 2009 and vest in 12 equal monthly portions over one
year.&#160;&#160;The expense for the awards is measured as of&#160;July 14, 2009
at $14.69 per share for&#160;18,000 shares, or a total stock award expense of
$264,420.&#160;&#160;This expense will be recognized as the stock awards vest in
12 equal portions of $22,035, or&#160;1500 shares per month for one
year.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: italic; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
following table sets forth certain information known to the Company regarding
the beneficial ownership of the Company&#8217;s Common Stock, the Company&#8217;s only
outstanding class of securities, as of March 1, 2010 by (a)&#160;each
shareholder known by the Company to be the beneficial owner of more than five
percent of the Company&#8217;s Common Stock, (b)&#160;each of the Company&#8217;s directors
and nominees for director, (c)&#160;each of the Company&#8217;s executive officers
named in the Summary Compensation Table above and (d)&#160;all executive
officers and directors of the Company as a group.&#160;&#160;The shareholders
listed below have sole voting and investment power except as noted.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="bottom" width="54%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="bottom" width="54%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Name
      and Address of Beneficial Owner (1)</font></div>
              </td>
              <td align="left" valign="bottom" width="4%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Amount
      and Nature of Beneficial</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ownership
      of Common Stock</font></div>
              </td>
              <td align="left" valign="bottom" width="3%" style="PADDING-BOTTOM: 2px"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%" style="BORDER-BOTTOM: black 2px solid">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Percent
      Owned Beneficially</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">and
      of Record (2)</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ludmila
      Smolyansky</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">7,520,354</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;44.8%</font></div>
              </td>
            </tr><tr bgcolor="white">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Julie
      Smolyansky</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;
      538,060</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      3.21%</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Edward
      Smolyansky</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      &#160;341,046</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      2.03%</font></div>
              </td>
            </tr><tr bgcolor="white">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Renzo
      Bernardi</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;
      &#160; 14,900</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      *</font></div>
              </td>
            </tr></table>
      </div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Julie
      Oberweis</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
      0</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      *</font></div>
              </td>
            </tr><tr bgcolor="white">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Gustavo
      Carlos Valle (3)</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
      0</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      *</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Val
      Nikolenko</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;&#160;&#160;&#160;&#160;&#160;
      5,000</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      *</font></div>
              </td>
            </tr><tr bgcolor="white">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Directors
      and Officers of the Company as a Group (eight persons in
      total)</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">8,422,360</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">50.2%</font></div>
              </td>
            </tr><tr bgcolor="#cceeff">
              <td align="left" valign="bottom" width="54%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">DS
      Waters, LP</font></div>
              </td>
              <td align="left" valign="bottom" width="4%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">3,454,756</font></div>
              </td>
              <td align="left" valign="bottom" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="bottom" width="20%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">20.6%</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; TEXT-DECORATION: underline">NOTES TO BENEFICIAL
OWNERSHIP TABLE</font></font></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(1)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">With
      the exception of Gustavo Carlos Valle&#160;&#160;and DS Waters, LP, the
      address for all Directors and shareholders listed in this table is 6431
      Oakton St., Morton Grove, IL 60053.&#160;&#160;The address for Gustavo
      Carlos Valle and DS Waters, LP is 100 Hillside Avenue, White Plains, NY
      10603-2861.</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(2)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Based
      upon 16,753,190 shares of Common Stock outstanding as of March 1,
      2010.</font></div>
              </td>
            </tr><tr>
              <td valign="top" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td valign="top" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr><tr>
              <td align="left" valign="top" width="2%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">(3)</font></div>
              </td>
              <td align="left" valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="top" width="75%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Mr.
      Valle is also an officer of the Dannon Company, Inc., which is an
      affiliate of DS Waters, LP.</font></div>
              </td>
            </tr><tr>
              <td align="left" valign="middle" width="2%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="75%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">11</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">PROPOSAL
2: RATIFICATION OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Audit
Committee of the Board has designated Plante as independent auditors of the
Company for the next fiscal year.&#160;&#160;The Audit Committee and the Company
have been advised by Plante that neither it nor any member or associate of such
firm has any relationship with the Company or with any of its affiliates other
than as independent accountants and auditors.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">REQUIRED
VOTE</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">An
affirmative vote of the holders of a majority of the shares of Common Stock
issued and outstanding is required for ratification of the appointment of
Plante.&#160;&#160;Abstentions and broker non-votes are considered shares of
stock present in person or represented by proxy at the Meeting and entitled to
vote and are counted in determining the number of votes necessary for a
majority.&#160;&#160;An abstention will therefore have the practical effect of
voting against ratification of the appointment because it represents one fewer
vote for ratification of the appointment.&#160;&#160;In the event that
ratification of the appointment of Plante as the independent public accountants
for the Company is not obtained at the Meeting, the Board of Directors will
reconsider its appointment.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">THE BOARD
OF DIRECTORS RECOMMENDS A VOTE TO APPROVE THE RATIFICATION OF THE APPOINTMENT OF
PLANTE &amp; MORAN, PLLC AS THE INDEPENDENT AUDITORS FOR THE CURRENT FISCAL YEAR
(ENDING DECEMBER 31, 2010), AND PROXIES SOLICITED BY THE BOARD WILL BE VOTED IN
FAVOR THEREOF UNLESS A SHAREHOLDER HAS INDICATED OTHERWISE ON THE
PROXY.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">During
the two most recent fiscal years, there have been no disagreements with Plante
on matters of accounting principles or practices, financial statement
disclosure, auditing scope or procedure, or any reportable event.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Representatives
of Plante are not expected to be present at the Meeting.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AUDIT
FEES</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">In 2009
and 2008, Plante &amp; Moran, PLLC billed Lifeway approximately $177,536 and
$153,550, respectively, for professional services rendered for the audit of
Lifeway&#8217;s annual financial statements and review of financial statements
included in Lifeway&#8217;s Forms 10-Q or services that are normally provided in
connection with statutory and regulatory filings or engagements in 2008 and
2009.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AUDIT-RELATED
FEES</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">None.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">TAX
FEES</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">No
professional services were rendered by Plante &amp; Moran, PLLC to Lifeway
regarding tax advice, tax compliance and tax planning during 2008 and
2009.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">ALL OTHER
FEES</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">No other
fees were billed to Lifeway by Plante &amp; Moran, PLLC during 2008 and 2009
other than those described in this report.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">No hours
expended by Plante &amp; Moran, PLLC in its engagement to audit Lifeway&#8217;s
financial statements for the most recent fiscal year were attributable to work
performed by persons other than Plante&#8217;s full-time permanent
employees.&#160;&#160;The Audit Committee has approved 100% of all services
performed by Plante for Lifeway and disclosed above.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">12</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">OTHER
MATTERS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The Board
of Directors knows of no other business to come before the
meeting.&#160;&#160;If, however, other matters properly come before the meeting,
it is the intention of the persons named in the enclosed proxy to vote the
shares represented thereby in accordance with their best judgment.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">SHAREHOLDER
PROPOSALS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Any
proposal that a shareholder may desire to present to the Company&#8217;s 2011 Annual
Meeting of Shareholders must be received in writing by Val Nikolenko, the
Secretary of the Company, on or before January&#160;6, 2011, in order to be
considered for possible inclusion in the Company&#8217;s proxy materials relating to
such meeting.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">UNTIMELY
SHAREHOLDER PROPOSALS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Any
shareholder proposals received by the Company after January&#160;6, 2011 shall
be considered an untimely proposal.&#160;&#160;The Company, in its sole
discretion, may consider untimely proposals for possible inclusion in its 2011
Annual Meeting proxy materials if such untimely proposals are received on or
before March 31, 2011.&#160;&#160;Any untimely shareholder proposals received
after March 31, 2011 shall not be considered for possible inclusion in the
Company&#8217;s 2011 Annual Meeting proxy materials.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">AVAILABILITY
OF PROXY MATERIALS</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">THE
PROXY STATEMENT, THE PROXY AND THE ANNUAL REPORT ARE AVAILABLE AT <font style="TEXT-DECORATION: underline">www</font><font style="DISPLAY: inline; TEXT-DECORATION: underline">.proxyvote.com</font>.&#160;&#160;&#160;To
view these documents, enter the 12-digit control number which appears on your
Notice.&#160;&#160;Our proxy materials and other SEC filings are also available
on the Internet at our website, www.lifeway.net, and on the SEC&#8217;s EDGAR system,
at www.sec.gov.&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">DIRECTIONS
TO THE ANNUAL MEETING OF SHAREHOLDERS ARE AVAILABLE UPON REQUEST DIRECTED TO
LIFEWAY&#8217;S SECRETARY AT 6431 WEST OAKTON, MORTON GROVE, IL 60053 OR (847)
967-1010.</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Lifeway&#8217;s
Annual Report on Form 10-K has been posted along with this Proxy
Statement.&#160;&#160;Such Annual Report is not a part of the proxy solicitation
materials.&#160;&#160;Upon receipt of a written request, Lifeway will furnish to
any shareholder, without charge, an additional copy of such Annual Report
(without exhibits).&#160;&#160;Any such written request should be directed to
Lifeway&#8217;s Secretary at 6431 West Oakton, Morton Grove, IL 60053 or (847)
967-1010.</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;&#160;</font></div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div>
        <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
              <td align="left" valign="middle" width="39%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              <td align="left" valign="middle" width="39%">
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">BY
      ORDER OF THE BOARD OF DIRECTORS</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ludmila
      Smolyansky</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Chairperson
      of the Board</font></div>
                <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">May
      6, 2010</font></div>
              </td>
            </tr></table>
      </div>
      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">&#160;</font></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt"><br></div>
      <div id="PGBRK" style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
        <div id="FTR">
          <div id="GLFTR" style="WIDTH: 100%" align="left">
          </div>
        </div>
        <div id="PN" style="PAGE-BREAK-AFTER: always">
          <div style="WIDTH: 100%; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">13</font></div>
          <div style="WIDTH: 100%; TEXT-ALIGN: center">
            <hr style="COLOR: black" noshade size="2">
          </div>
        </div>
        <div id="HDR">
          <div id="GLHDR" style="WIDTH: 100%" align="right">
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left">
          <div>&#160;</div>
          <div align="center">
            <table bgcolor="white" cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
                  <td nowrap width="25%" style="TEXT-ALIGN: left">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">LIFEWAY
      FOODS, INC. </font></font></div>
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">ATTN:
      EDWARD
      SMOLYANSKY&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
      </font></font></div>
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">6431
      W. OAKTON</font></font></div>
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">MRTON
      GROVE, IL&#160;&#160;60053</font></font></div>
                  </td>
                  <td width="75%">
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left">
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-STYLE: italic"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">VOTE
      BY INTERNET - www.proxyvote.com</font></font></font></font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-STYLE: italic"><font style="DISPLAY: inline; FONT-WEIGHT: normal; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">Use
      the Internet to transmit your voting instructions and for electronic
      delivery of information up until 11:59 P.M. Eastern Time the day before
      the cut-off date or meeting date. Have your proxy card in hand when you
      access the web site and follow the instructions to obtain your records and
      to create an electronic voting instruction
      form.</font></font></font></font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-STYLE: italic"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">Electronic
      Delivery of Future PROXY MATERIALS</font></font></font></font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-STYLE: italic"><font style="DISPLAY: inline; FONT-WEIGHT: normal; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">If
      you would like to reduce the costs incurred by our company in mailing
      proxy materials, you can consent to receiving all future proxy statements,
      proxy cards and annual reports electronically via e-mail or the Internet.
      To sign up for electronic delivery, please follow the instructions above
      to vote using the Internet and, when prompted, indicate that you agree to
      receive or access proxy materials electronically in future
      years.</font></font></font></font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-STYLE: italic"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">VOTE
      BY PHONE - 1-800-690-6903</font></font></font></font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-STYLE: italic"><font style="FONT-WEIGHT: normal; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman"><font style="FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: normal; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">Use
      any touch-tone telephone to transmit your voting instructions up until
      11:59 </font><font style="DISPLAY: inline; FONT-WEIGHT: normal; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">P.M.
      Eastern Time the day before the cut-off date or meeting date. Have your
      proxy card in hand when you call and then follow the
      instructions.</font></font></font></font></font></font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-STYLE: italic"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">VOTE
      BY MAIL</font></font></font></font></div>
                      <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold"><font style="DISPLAY: inline; FONT-STYLE: italic"><font style="DISPLAY: inline; FONT-WEIGHT: normal; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: times new roman">Mark,
      sign and date your proxy card and return it in the postage-paid envelope
      we have provided or return it to Vote Processing, c/o Broadridge, 51
      Mercedes Way, Edgewood, NY 11717.</font></font></font></font></div>
                    </div>
                    <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></div>
                  </td>
                </tr></table>
          </div>
          <div><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-STYLE: normal; FONT-FAMILY: Times New Roman">&#160;</font></div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left">
          <div align="center">
            <table bgcolor="white" cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
                  <td nowrap width="56%" style="TEXT-ALIGN: left"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">TO VOTE, MARK BLOCKS
      BELOW IN&#160;&#160;BLUE OR BLACK INK AS FOLLOWS:</font></td>
                  <td width="44%" style="TEXT-ALIGN: right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">KEEP THIS PORTION
      FOR YOUR RECORDS</font></td>
                </tr></table>
          </div>
          <div>
            <hr style="COLOR: black" align="center" noshade size="1" width="100%">
          </div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left">
          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left">
            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">
              <div align="center">
                <table bgcolor="white" cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
                      <td width="50%"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></td>
                      <td width="50%">
                        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: right"><font style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">DETACH
      AND RETURN&#160;&#160;THIS&#160;&#160;PORTION
  ONLY</font></font></div>
                      </td>
                    </tr></table>
              </div>
              <div><font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font></div>
            </div>
            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: center"><font style="DISPLAY: inline; FONT-WEIGHT: bold">THIS PROXY CARD IS VALID ONLY WHEN
SIGNED AND DATED.</font></div>
            <div style="MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt">&#160;</div>
          </div>
        </div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">
        <div style="DISPLAY: block; TEXT-INDENT: 0pt"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Board of Directors recommends that you vote FOR the following:</font></div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left">&#160;</div>
      </div>
      <div style="DISPLAY: block; TEXT-INDENT: 0pt">
        <div>
          <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
                <td align="left" valign="top" width="3%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">1.</font></div>
                </td>
                <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td align="left" valign="top" width="96%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Election
      of Directors:</font></div>
                </td>
              </tr><tr>
                <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="96%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              </tr><tr>
                <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td align="left" valign="top" width="96%" style="PADDING-LEFT: 0pt; MARGIN-LEFT: 9pt">
                  <div style="DISPLAY: block; MARGIN-LEFT: 9pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Nominees</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;</font></div>
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">01&#160;
      Ludmila Smolyansky&#160;&#160;&#160;&#160; 02&#160; Julie
      Smolyansky&#160;&#160;&#160;&#160; 03&#160; Pol
      Sikar&#160;&#160;&#160;&#160; 04&#160; Renzo
      Bernardi&#160;&#160;&#160;&#160; 05&#160; Gustavo Carlos
      Valle&#160;&#160;&#160;&#160; 06 Julie Oberweis</font></div>
                </td>
              </tr><tr>
                <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="96%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              </tr><tr>
                <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="96%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font> FOR ALL<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font> WITHHOLD ALL<font id="TAB2" style="LETTER-SPACING: 9pt">&#160;&#160;&#160;</font><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font> FOR ALL
      EXCEPT</font></td>
              </tr><tr>
                <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td align="left" valign="top" width="96%">&#160;</td>
              </tr></table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; TEXT-INDENT: 0pt">
          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-WEIGHT: bold; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">The
Board of Directors recommends you vote FOR the following
proposal(s):</font></div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div>
          <table cellpadding="0" cellspacing="0" width="100%" style="FONT-SIZE: 10pt; FONT-FAMILY: times new roman; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">
<tr>
                <td align="left" valign="top" width="3%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">2.</font></div>
                </td>
                <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td align="left" valign="top" width="96%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">Ratification
      of Plante &amp; Moran, PLLC, as independent auditors</font></div>
                </td>
              </tr><tr>
                <td valign="middle" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="middle" width="96%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
              </tr><tr>
                <td valign="top" width="3%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td valign="top" width="1%"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman">&#160;
      </font></td>
                <td align="left" valign="top" width="96%">
                  <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: times new roman"><font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font>
      FOR&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
      <font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font>
      AGAINST&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;&#160;
      <font style="DISPLAY: inline; FONT-FAMILY: wingdings">o</font>
      ABSTAIN</font></div>
                </td>
              </tr></table>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">
          <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman"><font style="DISPLAY: inline; FONT-WEIGHT: bold">NOTE: </font>Such other business as
may properly come before the meeting or any adjournment
thereof.</font></div>
        </div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt" align="justify">&#160;</div>
        <div style="DISPLAY: block; MARGIN-LEFT: 0pt; TEXT-INDENT: 0pt; MARGIN-RIGHT: 0pt; TEXT-ALIGN: left"><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">To&#160;withhold
authority&#160;to&#160;vote&#160;for&#160;any
individual&#160;nominee(s),&#160;mark&#160;&#8220;For&#160;All Except&#8221; and
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full </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">title as
such. </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">Joint
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Annual</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">Meeting:</font><font style="DISPLAY: inline; FONT-WEIGHT: bold">&#160;</font>The Notice &amp; Proxy
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at &#160;<font style="DISPLAY: inline; TEXT-DECORATION: underline">www.proxyvote.com</font>.</font></div>
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FOODS, INC.</font></div>
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Meeting of Shareholders</font></div>
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17, 2010 2:00 PM</font></div>
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proxy is solicited by the Board of Directors</font></div>
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undersigned hereby appoints Ludmila Smolyansky or Julie Smolyansky, with full
power of substitution, as </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">proxy to
vote the Common Stock of the undersigned in Lifeway Foods, Inc. at the above
Annual Meeting and at any adjournment thereof.</font></div>
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SHARES REPRESENTED BY THIS PROXY WILL BE VOTED AS HEREIN SPECIFIED. IF A CHOICE
IS </font><font style="DISPLAY: inline; FONT-SIZE: 10pt; FONT-FAMILY: Times New Roman">NOT
SPECIFIED, SUCH SHARES WILL BE VOTED FOR PROPOSALS 1 AND 2.</font></div>
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PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER DIRECTED HEREIN BY
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UNDERSIGNED SHAREHOLDER.</font></div>
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MARK, SIGN, DATE AND RETURN THIS PROXY IN THE ENCLOSED
ENVELOPE.</font></div>
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