SCHEDULE 14A
(Reg. (S) 240.14a-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )
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GUEST SUPPLY, INC.
(Name of Registrant as Specified In Its Charter)
________________________________________________________________________________
(Name of Person(s) Filing Proxy Statement if other than the Registrant)
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[GUEST SUPPLY LOGO]
January 19, 2001
Dear Fellow Shareholder:
You may have recently received correspondence from BFMA
Holding Corporation, the parent company of Guest Supply's
principal competitor, Marietta Corporation. BFMA is attempting to
elect two of its nominees as Class C directors at our next Annual
Meeting of Shareholders. We urge you to reject BFMA's
opportunistic advances and would also like to address misleading
statements made by BFMA that affect the investment decisions of
all Guest Supply shareholders.
. BFMA says it is "prepared" to make an offer to acquire
Guest Supply at $21 per share, but, contrary to their
claims, has NOT demonstrated the ability to finance a
purchase at this price. In fact, Guest Supply's investment
bankers asked to see BFMA's financing proposals and those
requests were refused.
. Guest Supply's anti-takeover devices are in place to
protect ALL shareholders from coercive takeover attempts.
As BFMA must know, it is not precluded from making an
appropriate offer conditioned on the lifting of the anti-
takeover devices (as is commonly done when a company has
adopted anti-takeover provisions).
. In 1988, when Mr. Stanley took over as President and CEO,
Guest Supply's Common Stock price was approximately $3.00
per share. Today, the price is over $18.00 per share,
which represents an increase in value of approximately
600%. In fiscal 2000, Guest Supply's share price
appreciated 30%.
. From January 1988 to the present, the Company's stock
price performance has kept pace with the performance of
the Dow Jones Industrial Average and the S&P 500 Index and
has substantially exceeded the performance of the Russell
2000 Index and the S&P Lodging and Hotels Index.
. BFMA's assertion that Mr. Stanley has created roadblocks
to having substantive discussions with other interested
parties is simply not true.
. Contrary to BFMA's statements, Marietta and Guest Supply
are very significant competitors. Indeed, Marietta is
Guest Supply's principal competitor in the $250 million
hotel amenities market, and it is Guest Supply's intense
competition with Marietta that has made that market highly
competitive.
. We believe that the track record of BFMA's President and
Chairman, Barry Florescue, as detailed in our last letter
to shareholders, should lead shareholders to question
BFMA's true motivation.
. We believe that BFMA's nominees for the Guest Supply Board
of Directors would face conflicts of interest arising from
their long service as directors of BFMA and Marietta, and,
in Mr. Delany's case, from Delany Capital Management
Corp.'s investment in Marietta. We believe that the
incumbent directors will be able to pursue the goal of
maximizing shareholder value more effectively than
nominees who have been affiliated with our principal
competitor.
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Your Board of Directors urges you not to take any action concerning
BFMA's nominees until you have had a chance to review Guest Supply's proxy
materials. We urge you to read and compare these materials carefully and
then decide who is truly acting independently in your best interests.
The Board also recommends that shareholders throw away BFMA's BLUE
proxy card and wait for the WHITE proxy card from Guest Supply.
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Guest Supply's Annual Meeting of Shareholders will be held at 10:00 a.m. on
March 9, 2001, at the Novotel Hotel, 100 Independence Way, Princeton, New
Jersey. The Guest Supply Board of Directors urges all shareholders to review
the Company's Proxy Statement, containing detailed reasons why you should not
vote in favor of BFMA's nominees.
Sincerely,
/s/ Clifford W. Stanley
Clifford W. Stanley
Chairman, President & Chief
Executive Officer
GUEST SUPPLY, INC. AND ITS DIRECTORS AND EXECUTIVE OFFICERS MAY BE DEEMED TO BE
PARTICIPANTS IN THE SOLICITATION OF PROXIES FROM GUEST SUPPLY SHAREHOLDERS. THE
DIRECTORS AND EXECUTIVE OFFICERS OF GUEST SUPPLY INCLUDE: CLIFFORD W. STANLEY,
TERI E. UNSWORTH, PETER L. RICHARD, EDWARD J. WALSH, THOMAS M. HAYTHE, GEORGE
S. ZABRYCKI, AND PAUL XENIS. COLLECTIVELY, AS OF DECEMBER 1, 2000, THE
DIRECTORS AND NAMED EXECUTIVE OFFICER OF GUEST SUPPLY BENEFICIALLY OWNED
APPROXIMATELY 14% OF THE OUTSTANDING SHARES OF THE COMPANY'S COMMON STOCK.
SHAREHOLDERS MAY OBTAIN ADDITIONAL INFORMATION REGARDING THE INTERESTS OF SUCH
PARTICIPANTS BY READING GUEST SUPPLY'S PROXY STATEMENT WHEN IT BECOMES
AVAILABLE. INVESTORS AND SECURITY HOLDERS ARE ADVISED TO READ THE PROXY
STATEMENT THAT WILL BE FILED BY GUEST SUPPLY RELATING TO GUEST SUPPLY'S 2001
ANNUAL MEETING WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN IMPORTANT
INFORMATION. Security holders may obtain a free copy of the proxy statement
(when it is filed) and other documents filed by Guest Supply with the
Securities Exchange Commission at the Commission's web site at www.sec.gov. The
proxy statement and such other documents, when filed by Guest Supply with the
SEC, may also be obtained for free from Guest Supply, Inc. by directing such
request to: MacKenzie Partners, Inc., 156 Fifth Avenue, New York, New York,
U.S.A., 10010 or by calling 800-322-2885.