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meVC DRAPER FISHER JURVETSON FUND I, INC.
(D/B/A MVC CAPITAL)
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(NAME OF REGISTRANT AS SPECIFIED IN ITS CHARTER)
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[MVC CAPITAL LOGO]
January 29, 2003
DEAR FELLOW STOCKHOLDER:
Enclosed with this letter is information about the MVC Capital Annual
Meeting of Stockholders, which will be held on February 28, 2003.
We believe it is important for you to know that:
[*] Your Company has assembled seven world-class Board of Directors
candidates -- individuals with proven track records in building
stockholder value. We believe their skill and experience in venture
capital and technology investments is unmatched and highly beneficial to
you and your Company. We have decided to place the entire Board up for
election at the upcoming meeting in order to give our stockholders a
clear choice in determining the future of MVC.
[*] We believe that we have reached a turning point in the venture capital
investing cycle and that prospects to meet the Fund's original long-term
investment objectives have never been better.
[*] We further believe that your Company's seven candidates are the best
qualified to take full advantage of these prospects and realize the
long-term potential of the Company. These Directors are also investing
their own money in the Company by purchasing Fund stock. They believe
the Company has a bright long-term future and want to align their
interests with yours.
A dissident stockholder -- Millenco, L.P. -- has announced its intention to
begin a proxy contest. Among other things, we believe Millenco will be proposing
its own nominees to seize control of your Company's Board of Directors. Based on
Millenco's track record of raiding other closed-end funds, we believe its
nominees will support Millenco's short-term interests. We strongly urge you to
reject Millenco's bid for your vote.
WE URGE YOU TO PROTECT YOUR INVESTMENT. Elect your Fund's Board of Directors
by voting FOR Proposals 1, 2 and 3 on the WHITE proxy card. We also urge you to
vote AGAINST the dissidents' Proposals 4 and 5 on the WHITE proxy card. And
please disregard any materials you receive from Millenco. Remember that your
vote is very important. Sign, date and mail the WHITE proxy card TODAY.
3000 SAND HILL ROAD, BUILDING ONE, SUITE 155 MENLO PARK, CALIFORNIA 94025
T. 650-926-7000 F. 650-926-7001 www.mvccapital.com
MVC'S WORLD-CLASS BOARD OF DIRECTORS IS BEST QUALIFIED TO LOOK
AFTER YOUR LONG-TERM INVESTMENT.
In our opinion, your Board's candidates comprise some of the most
experienced and accomplished business leaders in the United States. In our view,
they have a track record of building long-term stockholder value at some of the
country's largest and most well known companies:
[*] MICHAEL H. JORDAN. Former Chairman & CEO, CBS Corporation and
Westinghouse Electric Corporation. Board member of Dell Computer Corp.,
Aetna, Inc., i2 Technologies and Pinnacor Inc.
[*] LAURENCE R. HOOTNICK. Former President & CEO, Maxtor Corp. As a Senior
Vice President of Intel, his responsibilities included Finance &
Administration and Worldwide Sales & Marketing; also, former President
of Intel's Embedded Control & Memory Group. Co-founder of Acuity
Ventures.
[*] VINCENT H. TOBKIN. Director, Founder & Head, Worldwide Technology and
Telecom, Bain & Company. Earlier, he founded and was a General Partner
of Sierra Ventures and a Partner of McKinsey & Company's High Technology
Practice.
[*] PETER J. LOCKE. Former Managing Director and Head of the Western Region
of Citibank Corporate Banking, where he was involved in numerous
corporate debt financings. Currently a commercial and financial
arbitrator.
[*] FREDERICK M. HOAR. Communications and marketing strategist for leading
technology firms, from Fairchild to RCA. He led communications during
Apple's IPO and was involved with the launch of the Lisa and Macintosh
computers.
[*] JAMES K. SIMS. Founder and former CEO of Cambridge Technology Partners,
an international management consulting company. Founder and former
Chairman & CEO of Concurrent Computer Corporation. Co-Founder, Chairman
& CEO of GEN3 Partners and board member of RSA Security.
[*] JOHN M. GRILLOS. Chief Executive Officer of the Fund. General Partner
and Director of ITech Partners, L.P. Director of SmartForce/CBT Systems,
Inc., FOLIOfn Inc., ITech Ice LLP.
All seven of these candidates are running for election at the Annual Meeting
and all are pledged to building value for you. We urge you to elect these
individuals by voting FOR Proposals 1, 2 and 3 on the WHITE proxy card. We also
urge you to vote AGAINST the dissidents' proposals 4 and 5 on the WHITE proxy
card.
WHAT DOES MILLENCO REALLY WANT?
Millenco is an arbitrage hedge fund with a history of raiding closed-end
funds. We do not think their objectives are the same as yours. If Millenco
succeeds in liquidating MVC -- and that's what they have asked our Board to do
in the past -- their potential gain will come at the expense of your investment.
Hedge funds like Millenco have little or no experience with venture capital and
creating companies, much less technology companies. We believe that they are
therefore singularly unqualified to run your Company.
Ask yourself these questions:
Is liquidation the reason you bought shares in MVC? Do Millenco's nominees
have any experience trying to liquidate a portfolio of privately held stock?
Does Millenco or its nominees have any idea of the potential losses such
premature sales would bring?
In our opinion, the answer is clearly NO. Don't let Millenco's nominees control
the future of your investment. Elect MVC's candidates by voting FOR Proposals 1,
2 and 3 TODAY.
Do you want your investment managed by a Board of Directors that will look
after your long-term best interests or do you want to be represented by
'single purpose' Directors who can be expected to support the short-term
demands of an opportunistic hedge fund?
We believe that if Millenco's nominees are elected to the Company's Board, your
interests will be ignored in favor of the interests of short-term investors. Say
NO to Millenco. Vote FOR Proposals 1, 2 and 3 TODAY.
MVC CAPITAL HAS THE RIGHT STRATEGY AT THE RIGHT TIME.
Your Board of Directors firmly believes that we have reached a turning point
in the venture capital investing cycle. Valuations are extremely low while the
quality of the private companies seeking financing is high. Prospects to meet
the Fund's original long-term investment objective have never been better. We
are excited about our recent investments -- high-potential companies supported
by top-flight venture capital firms. These investments are further evidence that
we are making progress consistent with our original mission.
We have put into place a refined strategy that is the best course to build
long-term value for shareholders. Important elements of this strategy include:
[*] Venture debt financing in addition to equity investing -- a unique
strategy that diversifies our portfolio, generates interest income and
gives us greater access to invest in attractive companies backed by
leading venture capitalists
[*] A strengthened investment team with a streamlined management
organization
[*] A $20 million share repurchase program to take advantage of
opportunities to buy back MVC shares at appropriate levels to benefit
all shareholders
[*] A highly qualified and dedicated Board of Directors
ELECT YOUR BOARD OF DIRECTORS AND PROTECT YOUR INVESTMENT.
The Fund's mission was clearly set forth at its beginning: 'Long-term
capital appreciation from venture capital investments . . . in companies that we
believe have high-growth potential over the long term.' This is why you and your
fellow stockholders own shares in MVC Capital. Now, Millenco is seeking to
jeopardize your long-term investment. We urge you to protect your investment in
the Fund's original mission.
Here is what you should do:
[*] Vote FOR Proposals 1, 2 and 3 on the WHITE proxy card.
[*] Vote AGAINST the dissidents' Proposals 4 and 5 on the WHITE proxy card.
[*] Sign, date and mail the WHITE proxy card TODAY.
YOUR VOTE IS CRUCIAL -- it will determine the future direction of the
Company. Please help us fulfill the Company's original mission of superior
returns through long-term venture capital investments.
On Behalf of your Board of Directors,
Sincerely,
John M. Grillos
John M. Grillos
Chief Executive Officer
IF YOU HAVE ANY QUESTIONS OR NEED ASSISTANCE IN VOTING YOUR
SHARES, PLEASE CALL:
[MACKENZIE PARTNERS LOGO]
105 Madison Avenue
New York, New York 10016
email: proxy@mackenziepartners.com
Call collect: (212) 929-5500
OR TOLL FREE: (800) 322-2885
Facsimile: (212) 929-0308
STATEMENTS IN THIS ANNOUNCEMENT OTHER THAN HISTORICAL DATA AND INFORMATION
CONSTITUTE FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND UNCERTAINTIES THAT
COULD CAUSE ACTUAL RESULTS TO DIFFER MATERIALLY FROM THOSE STATED OR IMPLIED BY
SUCH FORWARD-LOOKING STATEMENTS. POTENTIAL RISKS AND UNCERTAINTIES MAY INCLUDE,
BUT ARE NOT LIMITED TO, RECENT CHANGES IN SENIOR MANAGEMENT, FLUCTUATIONS IN
OPERATING RESULTS, MARKET CONDITIONS, CHANGES IN TECHNOLOGY, INCREASED
COMPETITION AND OTHER RISKS IDENTIFIED BY MVC CAPITAL FROM TIME TO TIME IN ITS
FILINGS WITH THE SECURITIES AND EXCHANGE COMMISSION.