13D weekly report - Dec 30, 2024 to Jan 03, 2025

Baron Capital Group opposes the proposed "going private" transaction of FIGS, Inc (FIGS)

 Key Summary:  On December 31, 2024, Baron Capital Group (18%) opposes the proposed "going private" transaction of the company.

Market Cap: $1 billion | FIGS, Inc. operates as a direct-to-consumer healthcare apparel and lifestyle company in the United States and internationally.

On December 31, 2024, Baron Capital Group (18%) opposes the proposed "going private" transaction of the company. Baron believes FIGS has a strong balance sheet, no debt, and significant growth potential as a standalone public company. They argue a leveraged buyout would harm FIGS’ business, employees, product quality, and stakeholder interests by increasing costs and reducing growth opportunities. Baron supports FIGS’ management team and its long-term prospects, advocating for increased equity ownership incentives to drive growth. They urge the Board to reject any "going private" offers, emphasizing confidence in FIGS as a public entity. Source

BML Investment Partners  (9.9%) opposes the proposed PIPE transaction of Aadi Bioscience, Inc (AADI)

 Key Summary:  On December 31, 2024,  BML Investment Partners  (9.9%) opposes the proposed PIPE transaction

Market Cap: $77 million | Aadi Bioscience, Inc., a biopharmaceutical company, engages in developing and commercializing precision therapies for genetically defined cancers with alterations in mTOR pathway genes. 

On December 31, 2024,  BML Investment Partners  (9.9%) opposes the proposed PIPE transaction. While BML supports the $100 million FYARRO sale proceeds, they criticize the Board for not pursuing a full company sale or liquidating remaining assets, which could have delivered over $5 per share, a 100% return. Instead, the Board opted for "AADI 2.0," acquiring a $44 million preclinical ADC portfolio and issuing 41.7 million shares and warrants at $2.40 per share, giving PIPE investors 61% ownership despite contributing only 41.3% of capital. BML deems this deal unfair, destructive to shareholder value, and a breach of fiduciary duty. They advocate for either selling the company or returning FYARRO proceeds to legacy shareholders before pursuing the ADC strategy at a more reasonable valuation. Source

Act III Holdings entered into a Cooperation Agreement with BJ's Restaurants's (BJRI)

 Key Summary:  On December 30, 2024, Act III Holdings, LLC, along with related entities ("Act III Parties"), entered into a Cooperation Agreement with the company. Fund 1 Investments filed SC 13D on Jan 18, 2024, citing undervalued shares, cost issues, and seeking strategic changes. On Feb 27, 2024, it reached an agreement with the company. On March 6, 2024, PW Partners advised cost reduction, stock buyback, board downsizing, and new board members. Also proposed two candidates for board targeting operational enhancement. On March 26, 2024, PW Partners entered into a Cooperation Agreement with the company.

Market Cap: $819 million | BJ's Restaurants, Inc. owns and operates casual dining restaurants in the United States. 

Act III Holdings, LLC

On December 30, 2024, Act III Holdings, LLC, along with related entities ("Act III Parties"), 13d-weekly-report-dec-30-2024-to-jan-03-2025entered into a Cooperation Agreement with the company, outlining key commitments until May 4, 2027. These include standstill restrictions, voting in line with Board recommendations (with exceptions), mutual non-disparagement, and Act III Parties' support for the Company's key initiatives.

PW Partners Atlas Fund 

• On March 6, 2024, PW Partners (4.9%) disclosed that on February 20, 2024, it has sent a letter to the Chairman of the Board recommending cost reduction, stock buyback, board size reduction, and board nomination. Also it nominated Jeffery Crivello and Patrick Walsh for the board, aiming for operational improvement.
• On March 26, 2024, PW Partners entered into a Cooperation Agreement with the company resulting in Atlas Fund IV withdrawing its proposals for the 2024 Annual Meeting. The Agreement engages PW Partners to advise on cost efficiencies, with Mr. Walsh being granted restricted stock units as compensation.

Top of Form

Fund 1 Investments

• On January 18, 2024,  Fund 1 Investments (9.5%) stated that the shares are undervalued with potential for value maximization. They are skeptical of company's standalone strategy and unaddressed cost issues, prompting a Schedule 13D filing to push for strategic alternatives, including a potential sale. They plan to engage with the management and Board on operations, structure, and potential strategic transactions. Source
•  On February 27, 2024, the company and Fund 1 Investments  signed a Cooperation Agreement. Pursuant to it, the Board expanded to twelve directors, appointing C. Bradford Richmond, whose term ends at the 2024 Annual Meeting.

Barington Capital Group filed proxy materials seeking support for its nominees at Matthews International (MATW)

Key Summary: On December 10, 2024, Barington Capital Group (2%) called for replacing Matthews International CEO Joseph Bartolacci over 18 years of underperformance, nominating three directors for the 2025 Board. It urged divestments, focusing on Memorialization, boosting cost cuts to $80M, reducing debt, and improving governance to unlock shareholder value.

Market Cap: $827 million | Matthews International Corporation provides brand solutions, memorialization products, and industrial technologies worldwide. 

• On December 10, 2024, Barington Capital Group (2%) has urged the company to replace CEO Joseph Bartolacci, citing prolonged underperformance during his 18-year tenure. Barington has nominated three directors for the 2025 Board election and outlined recommendations, including divesting underperforming segments, focusing on high-potential businesses like Memorialization, increasing cost reductions to $80M, reducing debt, and enhancing corporate governance with experienced directors and a declassified Board. Barington believes these actions, coupled with new leadership, are essential to unlocking Matthews' long-term shareholder value. Source
• On December 19, 2024, Barington Capital Group filed proxy materials seeking support for its nominees
• On January 2, 2025, Barington Capital Group filed proxy materials seeking support for its nominees

Danone Accuses Lifeway Foods, Inc (LWAY) of Breach, Signals Potential Litigation

Key Summary:  On October 15, 2021, Ludmila and Edward Smolyansky announced their plan to nominate up to three directors at the 2021 AGM. By March 11, 2022, Edward aimed to nominate several directors and push for CEO replacement and strategic review. After a settlement on July 27, 2022, Edward withdrew his proxy contest, with the Company agreeing to new board nominations and strategic reviews. On February 10, 2023, the Smolyanskys alleged breaches of this agreement. By May 5, 2023, Edward filed to nominate seven directors, and all were elected on June 15, 2023. On October 26, 2023, they nominated a new director per the agreement and on July 18, 2024, called for the resignation of several executives, including the CEO. On August 13, 2024, Ludmila Smolyansky and Edward Smolyansky filed proxy materials soliciting consent for the Board Removal Proposal and the Director Election Proposal. On December 30, 2024, Danone North America accused Lifeway Foods and CEO Julie Smolyansky of breaching a Shareholder Agreement by issuing nearly 300,000 shares without consent, declaring the action void.

Market Cap: $185 million | Lifeway Foods, Inc. produces and markets probiotic-based products in the United States and internationally.

• On October 15, 2021, Ludmila Smolyansky, Chairperson of the Board, and Edward Smolyansky, COO of the company, disclosed 38.4% and stated that Edward Smolyansky intends to nominate up to three directors at the 2021 AGM. Source
• On February 21, 2022, the concerned shareholders (38.2%) notified the Board of their belief that the Company should replace the Company’s CEO, and commence an exploration of the Company’s strategic alternatives. Source
• On March 11, 2022, Edward Smolyansky notified the corporate secretary of the company of his intent to nominate himself, Ludmila Smolyansky, Robert Whalen, Austin Hollis and Iana Trifonova for election to the  Board at the 2022 AGM. As Mr. Smolyansky continues to prepare for a potential proxy contest in connection with the 2022 AGM, he intends to continue to engage in discussions with the Board regarding his belief that the Company should replace the Company’s CEO, and commence an exploration of the Company’s strategic alternatives. Source
• On July 27, 2022, Edward Smolyansky entered into a settlement agreement with the Company which terminates his potential proxy contest or solicitation with respect to the appointment of new directors to the Board. Pursuant to the Settlement Agreement, the Company has agreed, that (i) the Board will nominate: Juan Carlos Dalto, Jodi Levy, Dorri McWhorter, Perfecto Sanchez, Jason Scher, Pol Sikar, Julie Smolyansky and Ludmila Smolyansky, and (ii) the Board’s Audit and Corporate Governance Committee will oversee a review of strategic alternatives for the Company.
• On February 10, 2023, Ludmila Smolyansky and Edward Smolyansky provided a notice to the Company regarding potential breaches of the Settlement Agreement, dated as of July 27, 2022, as amended, among the Company, Ludmila Smolyansky and Edward Smolyansky (the “Settlement Agreement”). Under the Settlement Agreement, Ludmila Smolyansky’s and Edward Smolyansky’s “standstill” obligations under Section 6 of the Settlement Agreement terminate in the event of a material breach by the Company that is not cured within ten days by the Company. On February 22, 2023, the Company provided a written response, claiming that it had not materially breached the Settlement Agreement, and noting that a committee of the Company’s board of directors had approved the engagement of a nationally recognized financial advisor, and that certain terms of the engagement were being negotiated and remained subject to approval by the committee. Source
• On May 5, 2023, Mr. Smolyansky again notified the Company, in accordance with the Company’s bylaws, that he intended to nominate seven candidates for election as directors at the 2023 annual meeting.
• On May 9, 2023, Mr. Smolyansky filed proxy materials seeking support for its nominees.
• At the AGM held on June 15, 2023, all of the company's director nominees were elected to the Board.
• On October 26, 2023, Ludmila Smolyansky and Edward Smolyansky (together 31.1%) informed the company. that they are nominating a director in accordance with the Settlement Agreement from July 27, 2022. As per the agreement, the Board must appoint the nominee if approved by the Board and its Audit and Corporate Governance Committee in good faith, with no unreasonable withholding of approval. They also mentioned a second contingent nominee to be considered if the first nominee is not approved by the Board or the Committee. Source
• On July 18, 2024, Ludmila Smolyansky and Edward Smolyansky (together 8.4%) issued a press release demanding (i) the resignation of Julie Smolyansky, CEO and chairperson of the Company, (ii) the resignation of certain of the Company’s directors, including Jason Scher, Pol Sikar, Jody Levy, Dorri McWhorter and Perfecto Sanchez, (iii) the termination of Jason Burdeen, the Company’s chief of staff, (iv) the adoption of an anti-nepotism policy and (v) an operational and strategic review of the Company.
• On August 13, 2024, Ludmila Smolyansky and Edward Smolyansky filed proxy materials soliciting consent for the Board Removal Proposal and the Director Election Proposal. Source
• On December 30, 2024, Danone North America accused Lifeway Foods and CEO Julie Smolyansky of breaching a Shareholder Agreement by issuing nearly 300,000 shares without consent, declaring the action void. This follows rejected acquisition offers and Lifeway's leadership entrenchment, with Danone alleging shareholder value erosion through unauthorized stock grants and excessive compensation, hinting at potential litigation. Source

Fund 1 Pushes for Strategic Alternatives at Vera Bradley (VRA)

Key Summary: On June 26, 2024, Fund 1 Investments (9.8%) announced plans to discuss operational and strategic opportunities with the board to enhance stockholder value.  On January 2, 2025, Fund 1 Investments urged Vera Bradley to explore strategic alternatives, including a sale or privatization, to address operational struggles, brand challenges, and value erosion while supporting a brand revival and stakeholder benefits.

Market Cap: $103 million | Vera Bradley, Inc., together with its subsidiaries, designs, manufactures, and sells women's handbags, luggage and travel items, fashion and home accessories, and gifts.

• On June 26, 2024, Fund 1 Investments (9.8%) stated that it intends to engage in discussions with the board and management team regarding operational and strategic opportunities for the company to enhance stockholder value. Source
• On January 2, 2025, Fund 1 Investments expressed concerns about the company’s recent performance, including operational struggles, brand challenges, and value destruction. Citing Vera Bradley’s legacy of innovation and success, Fund 1 emphasized the need for a strategic alternatives process, such as a sale or privatization, to unlock shareholder value and support a brand revival without the pressures of public markets. They proposed pursuing opportunities for cost savings, focused brand recovery, and potential transaction structures benefiting stakeholders. Source