EXHIBIT 99.5
 
                         [MATRIDIGM LOGO APPEARS HERE]
 
Fellow Shareholders:
 
  You are being asked to consider and vote on a proposal to approve the terms
of the acquisition of MatriDigm Corporation by Zitel Corporation. Pursuant to
the terms of the merger, Millennium Acquisition I Corp., a wholly owned
subsidiary of Millennium Holding Corp. ("Holdco"), a wholly owned subsidiary of
Zitel Corporation, will merge with and into MatriDigm. Following the merger,
MatriDigm will be a wholly owned subsidiary of Holdco. In the acquisition of
MatriDigm, each of your shares of MatriDigm common stock will receive
approximately .65 of a share of Holdco common stock, subject to adjustment for
options to purchase shares of Zitel common stock or MatriDigm common stock
exercised between October 5, 1998 and the date of the Proxy
Statement/Prospectus/Consent Solicitation. Shareholders of Zitel will receive
one share of Holdco common stock for each share of Zitel common stock held by
such shareholder. The exchange of MatriDigm stock for Holdco common stock
(other than cash paid in lieu of fractional shares) will be tax-free to
MatriDigm shareholders for federal income tax purposes.
 
  Your Board of Directors unanimously recommends that you vote FOR approval of
these mergers, which we believe is in MatriDigm's and your best interests.
 
  We have enclosed a Proxy Statement/Prospectus/Consent Solicitation discussing
the merger. We encourage you to read this document carefully. Also enclosed is
a written consent so you can vote on this proposal. Please complete, sign and
date the enclosed written consent and return it to us as soon as possible in
the envelope we have provided.
 
                                          Very truly yours,
 
                                          Richard J. Ormond
                                          President and Chief Executive
                                           Officer
 
October  , 1998