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Morgan, Lewis &
Bockius LLP
2 Palo Alto Square
3000 El Camino Real, Suite 700
Palo Alto, CA 94306-2122
Tel. 650.843.4000
Fax: 650.843.4001
www.morganlewis.com
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Thomas W.
Kellerman
Partner
650.843.7550
tkellerman@morganlewis.com
May 20, 2009
VIA EDGAR
AND FACSIMILE
Mr. Jeffrey P.
Riedler
Assistant Director
Securities and Exchange
Commission
Division of Corporation
Finance
100 F Street N.E.
Washington, DC 20549
Facsimile Number:
202.772.9217
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Re:
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Nature’s Sunshine Products, Inc.
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Registration Statement on Form 10-12G
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Supplemental Response, dated April 23, 2009
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File No. 0-08707
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Dear Mr. Riedler:
This
letter is being submitted in response to the comments from the Staff of the
Securities and Exchange Commission (the “Commission”) contained in your
letter to Mr. Douglas Faggioli at Nature’s Sunshine Products, Inc.
(the “Company”), dated May 1, 2009 (the “Comment Letter”),
with respect to the Company’s supplemental response, dated April 23, 2009,
in connection with the Company’s Amendment No. 1 to the Registration
Statement on Form 10-12G, filed with the Commission on March 31, 2009
(the “Form 10-12G”).
Concurrently
with this response letter, the Company is filing an amended Form 10-12G,
which incorporates the changes previously agreed to with the Staff to the
disclosures below in response to the Comment Letter. The amended Form 10-12G also includes updated
financial information and related disclosures as reported in the Company’s
Quarterly Report on Form 10-Q for the quarter ended March 31, 2009,
as well as certain changes and additions resulting from management’s ongoing
review of the disclosures contained therein.
For
the convenience of the Staff, we are also sending three (3) marked copies
of the amended Form 10-12G under separate cover, which have been marked to
show changes from the Form 10-
Palo Alto Philadelphia Washington New York
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Boston London
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Beijing Tokyo
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Securities and Exchange
Commission
May 20, 2009
Page 2
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12G as
filed on February 12, 2009.
Amendment No. 1 to Form 10-12G
Explanatory Note, page 1
1. We note your response to the comment
1 from our prior letter dated April 14, 2009. Please revise your proposed disclosure in the
paragraph that begins, “The Board of Directors also considered the appropriate
actions to be taken with respect to Mr. Douglas Faggioli,” to make clear
that KPMG’s demand for Mr. Faggioli’s termination followed the remedial
measures recommended by the Investigative Team in the Preliminary Report and
the Investigative Team’s recommendations were supported by the Special
Committee. As written, it would be
difficult for a reader unfamiliar with the events to discern that KPMG was
acting on the recommendation of the Investigative Team contained in the
Preliminary Report and that one of the recommendations was Mr. Faggioli’s
termination.
In response to the Staff’s
comment, the Company’s disclosure with respect to the above-referenced
paragraph will read as follows (which for the convenience of the Staff has been
marked against the Company’s supplemental response to the Staff’s prior comment):
The Board of Directors also considered the appropriate
actions to be taken with respect to Mr. Douglas Faggioli. As described below, KPMG LLP (“KPMG”), our
independent registered public accounting firm at that time, demanded that Mr. Faggioli’s
employment be terminated based upon its view
of the recommendations in the Preliminary Report. The two members of the Special Committee
supported this recommendation, but after consideration the Board of Directors
determined that, pending the conclusion of the investigation, Mr. Faggioli
should step down as President, Chief Executive Officer and a director of the
Company, but remain an employee. The Board of Directors was informed that the
Investigative Team agreed that the interim steps regarding Mr. Faggioli
were appropriate at that time.
2. In addition, please revise your
proposed disclosure in this paragraph to make clear that, while the
Investigative Team may have agreed that the interim steps taken by the Board
were appropriate at that time, that neither it nor the Special Committee
ultimately changed their recommendation to remove Faggioli permanently.
In response to the Staff’s
comment, the last paragraph in the Explanatory Note under the heading “Change
in Certifying Accountant” in the amended Form 10-12G will read as follows
(which for the convenience of the Staff has been marked against the current
disclosure in the Form 10-12G):
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Securities and Exchange
Commission
May 20, 2009
Page 3
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In August 2006, following the completion of the Special Committee’s
internal investigation, the Board of Directors reinstated Mr. Faggioli as
the Company’s President and Chief Executive Officer. The Special Committee made no final determination with respect to Mr. Faggioli
or the other recommendations in the Preliminary Report, but its members, who
were both members of the Board of Directors at that time, participated in the
deliberations of the Board of Directors.
The Board of Directors made this decision after carefully reviewing and
considering the information available to it with respect to Mr. Faggioli,
including the facts and circumstances identified through the investigation, his
past performance and contributions to the Company, his business reputation, and
his prior employment history. In connection with the private class actions
and government investigations discussed below under Item 8, “Legal
Proceedings,” the Board of Directors has determined to vigorously contest
allegations of illegal conduct and misrepresentations that are or may be based
upon the events that led to the resignation of KPMG.
On
behalf of the Company, I would like to thank you for the cooperation that you
and the Staff have extended in the review of the Form 10-12G. If you should have any questions or comments
in connection with our responses, please feel free to contact the undersigned
at (650) 843-7550.
Very truly yours,
Thomas W.
Kellerman
c: Douglas Faggioli
President and Chief Executive Officer
Nature’s Sunshine Products, Inc.
75 East 1700 South
Provo, Utah 84606