ABOUT 21st CENTURY FUND

The Michigan Opportunity

We believe that a strong opportunity for private equity investment exists in Michigan given the State's strong capital and resource base, a vibrant infrastructure of government, industry and academic constituencies that support private equity, and the increasing number of start-up companies that require financing for growth. While Michigan has historically been dependent on manufacturing, the State, under the guidance of Governor Jennifer M. Granholm, is steadily transforming into a key technology center of the Midwest. Information technology, life sciences, advanced manufacturing and homeland security sectors have been growing significantly in the State over the past few years and will require additional equity capital for future growth. The multitude of technologically advanced companies in need of private equity financing presents an opportunity for private equity firms from across the nation to participate in a Michigan-based program.

Michigan's various economic development organizations, private and non-profit institutions, and its network of public and private universities make up a strong infrastructure for the further development of the private equity community in Michigan. Michigan has an academic community of over 90 colleges, universities and institutions with excellent research and technology transfer capabilities. The University of Michigan ranked second in the nation in terms of research, with $780.0 million spent on research in 2003. The State also has strong, established economic development organizations and various programs such as the Michigan Economic Development Corporation, Michigan Venture Capital Association, Michigan SmartZones, Michigan Renaissance Zones and Michigan Technology Tri-Corridor that are dedicated to the growth of local businesses. Established in 1996, Michigan Renaissance Zones were the nation's first state tax-free regions and are now emulated by a number of other states, reflecting the State's commitment to taking innovative approaches to economic development. The State has successfully brought these organizations and initiatives together to promote and develop entrepreneurship and private equity investing.

Given the multitude of emerging companies in need of equity financing, the increased technology transfer activity at the university level and the strong economic development programs in place across the State, we believe that Michigan is ripe for a successful in-state private equity program (the "Program"). The Program would focus on generating superior risk-adjusted returns, while contributing to the economic growth of Michigan and the Great Lakes area.