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      <P>&nbsp;</P>
      <P><FONT face="Arial, Helvetica, sans-serif" 
      size=2>One alternative is the <a href="http://schwab.ed10.net/ud/FSXF/5ZAF/1C0Q/PJ/UUL2JZ"> Schwab 1000 Fund&#174;</a>.  It&#146;s designed to help investors track the total return of the Schwab 1000 Index&#174;.  The index includes 1,000 large- and mid-cap stocks and will typically represent between 85% and 90% of the total value of all U.S. stocks.&nbsp;</FONT></P>
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      <P><font face="Arial, Helvetica, sans-serif" size="2">Not only does the Schwab 1000 Fund provide investors with broad exposure to companies in many different industries and of many different sizes, but part of its stated strategy is to consider the tax consequences of its investment decisions in an effort to help reduce the tax burden on its shareholders. It&#146;s a strategy that seems to have paid off.</font></P>
      <P align=center><FONT face="Arial, Helvetica, sans-serif" color=#669999 
      size=3>Since its inception in April of 1991, the Schwab 
      1000 Fund <BR>has <B>yet to pay a capital gain distribution</B>. This 
      doesn&#8217;t <BR>guarantee that it will never do so, but it does help 
      illustrate<BR>the effectiveness of its <B><a href="http://schwab.ed10.net/ud/FSXF/7M5B/1C0Q/RF/UUL2JZ">tax-smart 
      strategy</a></B>.</FONT></P>
      <P><FONT face="Arial, Helvetica, sans-serif" size=5><B><FONT color=#336699 
      size=4>Get started today.</FONT></B></FONT><FONT 
      face="Arial, Helvetica, sans-serif" size=2><BR></FONT><font face="Arial, Helvetica, sans-serif" size="2">You can invest in the Schwab 1000 Fund for a minimum of $2,500 ($1,000 for retirement and custodial accounts). Or you can increase your investment to qualify for Select Shares,&#174; a separate class of shares offering lower expenses for a minimum initial investment of $50,000.   As with all SchwabFunds, there are no loads or purchase fees.*</font></P>
      <P><font face="Arial, Helvetica, sans-serif" size="2">You can view, download and print the
      <a href="http://schwab.ed10.net/ud/FSXF/X8GE/1C0Q/VU/UUL2JZ"> prospectus
      online</a>, or call us at <b><font color="#669999"> 800.435.4000</font></b> and one of our representatives will be glad to help you. Please read the prospectus carefully before you invest or send money. It contains more complete information on management fees, risks and expenses.</font></P>
<hr>
      <P><font face="Arial, Helvetica, sans-serif" size="1"><i>The Schwab 1000 Index&#174; includes common stocks of the 1,000 largest publicly traded companies as measured by market capitalization. It does not include privately held companies, investment companies or companies incorporated outside the United States. Unlike fund returns, indices do not reflect any fee or expense deductions and cannot be invested in directly.</i></font></P>
      <P><font face="Arial, Helvetica, sans-serif" size="1">* Investor shares, with operating expenses of 0.46%, require a $2,500 minimum initial investment. Select Shares, with operating expenses of 0.35%, require a minimum initial investment of $50,000. The fund charges a redemption fee of 0.75% for shares sold within 180 days of purchase. The expense ratio reflects a voluntary reduction by Charles Schwab Investment Management, Inc. (CSIM) and Schwab, which is guaranteed through at least February 28, 2002.</font></P>
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      <p><font face="Arial, Helvetica, sans-serif" size="1">If you would prefer to receive only service emails, please reply to this email indicating your preference. Please note: doing so will not remove you from any SchwabAlerts(r) or email newsletter to which you have actively subscribed.&nbsp;<br>
      <br>
      We respect your privacy. Schwab will use the information you provide to send you email alerts, communicate with you and provide information about products and services. Read about Schwab's
      <a href="http://www.schwab.com/privacy"> privacy policy</a>.<br>
      <br>
      Access to the Electronic Services and your account may be limited or unavailable during periods of peak demand, market volatility, systems upgrades or maintenance or other reasons.<br>
      <br>
      Notice: All email sent to or from the Charles Schwab corporate email system may be retained, monitored and/or reviewed by Schwab personnel.<br>
      <br>
      (c)2001 Charles Schwab &amp; Co., Inc. All rights reserved. Member SIPC/NYSE. (1201-14977)</font></TD></TR></TBODY></TABLE>
      
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