American Express Retirement Services Expands SmartPartners Program With Large Cap Growth Offering.

Business Editors

MINNEAPOLIS--(BUSINESS WIRE)--Aug. 7, 2002

Preferred Large Cap Growth Fund broadens

non-proprietary growth options

American Express Retirement Services, a service group of American Express Financial Advisors Inc., today announced an agreement to make available the Preferred Large Cap Growth Fund (PFGRX) from The Preferred Group of Mutual Funds, subadvised by Jennison Associates LLC. The new fund is part of American Express Retirement Services' SmartPartners(R) Platinum program.

The Preferred Large Cap Growth Fund's objective is to invest a majority of its assets in large capitalization companies believed to offer the potential for capital appreciation. These include stocks of companies they believe will experience above-average earnings growth.

Subadviser Jennison Associates LLC's philosophy is that original, bottom-up fundamental research, individual security selection and implementation by a highly experienced, specialized team are key to successful growth stock investing. When selecting securities for purchase or sale, Jennison considers a variety of factors, including a company's earnings, revenue and cash flow growth, profitability, financial condition, the company's business franchise and market position, strength and experience of its management group, research and development practices, and marketing strength and capability.

"Style purity is something we prize in our SmartPartners," said Ward Armstrong, president of American Express Retirement Services. "While many large cap growth funds have drifted toward mid cap attempting to enhance performance, the Preferred Large Cap Growth Fund has been a solid performer while remaining squarely in the large cap arena."

The Preferred Large Cap Growth Fund is managed by Kathleen McCarragher, executive vice president of Jennison. Kathleen assumed management of the Preferred Large Cap Growth Fund in April 1999, and holds a B.B.A. in Finance from the University of Wisconsin and an M.B.A. from Harvard Business School. In addition to Kathleen, the Jennison large cap growth portfolio management team is composed of Spiros Segalas, Micheal Del Balso & Jeffrey Siegel.

Jennison Associates LLC was founded in 1969 as a registered investment adviser of growth equity accounts for large institutions. Its strengths include in-depth research, experience in different market environments and extensive equity and fixed-income expertise. As of March 31, 2002, Jennison managed $60.7 billion in assets. Jennison has been the subadviser of the Preferred Large Cap Growth Fund since the fund's inception in July 1992.

The Preferred Large Cap Growth Fund is made available by The Preferred Group of Mutual Funds. For more complete information and a Preferred Group prospectus, including fees and expenses, please call 1-800-662-4769, or visit http://www.PreferredGroup.com. Please read the prospectus carefully before investing or sending money. The Preferred Group of Mutual Funds is a publicly offered open-end, no-load investment company offering a diversified family of funds sponsored by Caterpillar Investment Management Ltd. (CIML). CIML is a wholly owned investment management subsidiary of Caterpillar Inc., and manages assets for Caterpillar and for small- and mid-size retirement plan sponsors.

Begun in 1993, American Express Retirement Services' SmartPartners program is regarded as the longest running program of its kind (most recently in "Market Update: The 401(k) Industry, " a 2001 report from Cerulli Associates, Inc.). American Express Financial Advisors Inc. pioneered an open investment option approach for retirement plan sponsors and investors, signaling the end to the common practice of limiting plans to one fund family. Today, such flexibility is the de facto standard for many service providers. In late 2001 American Express Retirement Services enhanced the SmartPartners program, adding a "Platinum" list of nonproprietary funds with ongoing qualitative oversight and American Express' seamless service, and an "Open Market" list of nonproprietary funds extending access to more then 2400 mutual funds from 70 fund families.

Along with the SmartPartners Open Market and SmartPartners Platinum programs, American Express Retirement Services makes available funds from American Express(R) Funds, American Express Trust Collective Funds and separate account management.

For more information on American Express Retirement Services, visit americanexpress.com/sponsors. American Express Retirement Services is a service group of American Express Financial Advisors Inc., provider of financial advisory services and investment programs for more than 2.3 million clients. They have helped people with their financial goals for over 100 years.

American Express Retirement Services is a service group of American Express Financial Advisors Inc. Registered investments and financial planning services are offered through American Express Financial Advisors Inc., Member NASD. American Express Company is separate from American Express Financial Advisors Inc. and is not a broker-dealer. Retirement plan and trust related services are offered through American Express Trust Company.

American Express mutual funds are distributed by American Express Financial Advisors Inc. The Preferred Group of Mutual Funds is distributed by Caterpillar Securities Inc.

For more complete information about mutual funds call 1-800-437-0600 to request a current prospectus. Read the prospectus carefully before you invest or forward funds.

The Preferred Group of Mutual Funds is a family of no-load mutual funds and does not charge 12b-1 fees. As with any no-load mutual funds, however, certain other fees and expenses apply to a continued investment in the funds. These fees and expenses are described in the prospectus, which should be read carefully before making an investment.

Past performance is no guarantee of future results. As with most investment options, both the value of your investment and your total return will vary. Your shares/units, when redeemed, may be worth more or less than what you originally paid for them.