As filed with the Securities and Exchange Commission on October 3, 2001

Securities Act File No. 333-67842

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U.S. SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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FORM N-14
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

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[_] Post-Effective Amendment No.
[X] Pre-Effective Amendment No. 1

(Check appropriate box or boxes)

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SUNAMERICA STRATEGIC INVESTMENT SERIES, INC.
(Exact Name of Registrant as Specified in its Charter)

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1-800-858-8850
(Area Code and Telephone Number)

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733 Third Avenue
Third Floor
New York, NY 10017
(Address of Principal Executive Offices:
Number, Street, City, State, Zip Code)

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Robert M. Zakem, Esq.
c/o SunAmerica Asset Management Corp.
733 Third Avenue
Third Floor
New York, NY 10017
(Name and Address of Agent for Service)

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Copy to:
Counsel for the Fund:
Shearman & Sterling
599 Lexington Avenue
New York, NY 10022
Attention: Joel H. Goldberg, Esq.

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Approximate Date of Proposed Public Offering: As soon as practicable after
the Registration Statement becomes effective under the Securities Act of 1933.

Title of Securities Being Registered: Shares of Common Stock, Par Value
$0.0001 per share.

No filing fee is required because of reliance on Section 24(f) under the
Investment Company Act of 1940, as amended.

The registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.

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NORTH AMERICAN FUNDS

Stock Index Fund
Science & Technology Fund
Aggressive Growth LifeStyle Fund
Moderate Growth LifeStyle Fund
Conservative Growth LifeStyle Fund
286 Congress Street
Boston, Massachusetts 02210

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NOTICE OF JOINT SPECIAL MEETING OF SHAREHOLDERS

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TO BE HELD ON NOVEMBER 7, 2001

To our Shareholders:

Notice is Hereby Given that a joint special meeting of shareholders (the
"Meeting") of the Stock Index Fund (the "NAF Stock Index Fund"), Science &
Technology Fund (the "NAF Science & Technology Fund"), Aggressive Growth
LifeStyle Fund (the "NAF Aggressive Growth LifeStyle Fund"), Moderate Growth
LifeStyle Fund (the "NAF Moderate Growth LifeStyle Fund") and Conservative
Growth LifeStyle Fund (the "NAF Conservative Growth LifeStyle Fund," and
together with the NAF Stock Index Fund, NAF Science & Technology Fund, NAF
Aggressive Growth LifeStyle Fund and NAF Moderate Growth Lifestyle Fund, the
"Acquired Funds") of North American Funds will be held at the principal
executive offices of North American Funds, 286 Congress Street, Boston,
Massachusetts 02210 on November 7, 2001 at 10:00 a.m. Eastern Time, for the
following purposes:

(1) (a) All Acquired Funds: to approve or disapprove a new investment
advisory agreement (the "New Investment Advisory Agreement") between
American General Asset Management Corp. ("AGAM") and North American Funds
on behalf of each of the Acquired Funds, the terms of which are the same in
all material respects to the previous investment advisory agreement with
AGAM;

(b) All Acquired Funds (other than the NAF Science & Technology Fund):
to approve or disapprove a new subadvisory agreement (the "New Subadvisory
Agreement") between AGAM and American General Investment Management, L.P.
("AGIM") or an affiliate thereof, the terms of which are the same in all
material respects as the previous subadvisory agreement between AGAM and
AGIM;

(2) (a) NAF Stock Index Fund: to approve or disapprove an Agreement and
Plan of Reorganization (the "Stock Index Funds Agreement and Plan")
providing for the acquisition of substantially all of the assets, and
assumption of substantially all of the liabilities, of the NAF Stock Index
Fund by the SunAmerica Stock Index Fund of SunAmerica Strategic Investment
Series, Inc. (the "SunAmerica Stock Index Fund" or an "Acquiring Fund"),
solely in exchange for an equal aggregate value of newly issued shares of
the SunAmerica Stock Index Fund, as described in the accompanying proxy
statement and prospectus. The SunAmerica Stock Index Fund is a newly
created series of SunAmerica Strategic Investment Series, Inc., created for
the purpose of receiving the assets from the NAF Stock Index Fund. The
Stock Index Funds Agreement and Plan also provides for distribution of the
shares of the SunAmerica Stock Index Fund to shareholders of the NAF Stock
Index Fund. A vote in favor of this proposal will constitute a vote in
favor of the termination of the NAF Stock Index Fund as a separate
investment portfolio of North American Funds;

(b) NAF Science & Technology Fund: to approve or disapprove an Agreement
and Plan of Reorganization (the "Science & Technology Funds Agreement and
Plan") providing for the acquisition of substantially all of the assets,
and assumption of substantially all of the liabilities, of the NAF Science
& Technology Fund by the SunAmerica Science & Technology Fund of SunAmerica
Strategic Investment

Series, Inc. (the "SunAmerica Science & Technology Fund" or an "Acquiring
Fund"), solely in exchange for an equal aggregate value of newly issued
shares of the SunAmerica Science & Technology Fund, as described in the
accompanying proxy statement and prospectus. The SunAmerica Science &
Technology Fund is a newly created series of SunAmerica Strategic
Investment Series, Inc., created for the purpose of receiving the assets
from the NAF Science & Technology Fund. The Science & Technology Funds
Agreement and Plan also provides for distribution of the shares of the
SunAmerica Science & Technology Fund to shareholders of the NAF Science &
Technology Fund. A vote in favor of this proposal will constitute a vote in
favor of the termination of the NAF Science & Technology Fund as a separate
investment portfolio of North American Funds;

(c) NAF Aggressive Growth LifeStyle Fund: to approve or disapprove an
Agreement and Plan of Reorganization (the "Aggressive Growth LifeStage
Funds Agreement and Plan") providing for the acquisition of substantially
all of the assets, and assumption of substantially all of the liabilities,
of the NAF Aggressive Growth LifeStyle Fund by the SunAmerica Aggressive
Growth LifeStage Fund of SunAmerica Strategic Investment Series, Inc. (the
"SunAmerica Aggressive Growth LifeStage Fund" or an "Acquiring Fund"),
solely in exchange for an equal aggregate value of newly issued shares of
the SunAmerica Aggressive Growth LifeStage Fund, as described in the
accompanying proxy statement and prospectus. The SunAmerica Aggressive
Growth LifeStage Fund is a newly created series of SunAmerica Strategic
Investment Series, Inc., created for the purpose of receiving the assets of
the NAF Aggressive Growth LifeStyle Fund. The Aggressive Growth LifeStage
Funds Agreement and Plan also provides for distribution of the shares of
the SunAmerica Aggressive Growth LifeStage Fund to shareholders of the NAF
Aggressive Growth LifeStyle Fund. A vote in favor of this proposal will
constitute a vote in favor of the termination of the NAF Aggressive Growth
LifeStyle Fund as a separate investment portfolio of North American Funds;

(d) NAF Moderate Growth LifeStyle Fund: to approve or disapprove an
Agreement and Plan of Reorganization (the "Moderate Growth LifeStage Funds
Agreement and Plan") providing for the acquisition of substantially all of
the assets, and assumption of substantially all of the liabilities, of the
NAF Moderate Growth LifeStyle Fund by the SunAmerica Moderate Growth
LifeStage Fund of SunAmerica Strategic Investment Series, Inc. (the
"SunAmerica Moderate Growth LifeStage Fund" or an "Acquiring Fund"), solely
in exchange for an equal aggregate value of newly issued shares of the
SunAmerica Moderate Growth LifeStage Fund, as described in the accompanying
proxy statement and prospectus. The SunAmerica Moderate Growth LifeStage
Fund is a newly created series of SunAmerica Strategic Investment Series,
Inc., created for the purpose of receiving the assets from the NAF Moderate
Growth Lifestyle Fund. The Moderate Growth LifeStage Funds Agreement and
Plan also provides for distribution of the shares of the SunAmerica
Moderate Growth LifeStage Fund to shareholders of the NAF Moderate Growth
LifeStyle Fund. A vote in favor of this proposal will constitute a vote in
favor of the termination of the NAF Moderate Growth LifeStyle Fund as a
separate investment portfolio of North American Funds;

(e) NAF Conservative Growth LifeStyle Fund: to approve or disapprove an
Agreement and Plan of Reorganization (the "Conservative Growth LifeStage
Funds Agreement and Plan") providing for the acquisition of substantially
all of the assets, and assumption of substantially all of the liabilities,
of the NAF Conservative Growth LifeStyle Fund by the SunAmerica
Conservative Growth LifeStage Fund of SunAmerica Strategic Investment
Series, Inc. (the "SunAmerica Conservative Growth LifeStage Fund" or an
"Acquiring Fund"), solely in exchange for an equal aggregate value of newly
issued shares of the SunAmerica Conservative Growth LifeStage Fund, as
described in the accompanying proxy statement and prospectus. The
SunAmerica Conservative Growth LifeStage Fund is a newly created series of
SunAmerica Strategic Investment Series, Inc., created for the purpose of
receiving the assets from the NAF Conservative Growth LifeStyle Fund. The
Conservative Growth LifeStyle Funds Agreement and Plan also provides for
distribution of the shares of the SunAmerica Conservative Growth LifeStage
Fund to shareholders of the NAF Conservative Growth LifeStyle Fund. A vote
in favor of this proposal will constitute a vote in favor of the
termination of the NAF Conservative Growth LifeStyle Fund; and

(3) To transact such other business as properly may come before the
Meeting or any adjournment thereof.

The Board of Trustees of North American Funds has fixed the close of
business on September 17, 2001 as the record date for the determination of
shareholders entitled to notice of, and to vote at, the Meeting or any
adjournment thereof.

A complete list of the shareholders of each of the Acquired Funds entitled
to vote at the Meeting will be available and open to the examination of any
shareholders of each Acquired Fund for any purpose germane to such Meeting
during ordinary business hours from and after October 24, 2001 at the offices
of North American Funds, 286 Congress Street, Boston, Massachusetts and at the
Meeting.

You are cordially invited to attend the Meeting. Shareholders who do not
expect to attend the Meeting in person are requested to complete, date and sign
the enclosed respective proxy card and return it promptly in the postage-paid
envelope provided for that purpose. Alternatively, you may vote your shares by
calling a specially designated telephone number (toll free 1-888-221-0697) or
via the Internet at http://www.proxyweb.com. Each of the enclosed proxies is
being solicited on behalf of the Board of Trustees of North American Funds.

The Board of Trustees of North American Funds unanimously recommends that
the shareholders of each Acquired Fund approve the New Investment Advisory
Agreement, the New Subadvisory Agreement (if applicable) and the respective
Agreement and Plan of Reorganization.

By Order of the Board of Trustees,
/s/John I. Fitzgerald
John I. Fitzgerald
Secretary, North American Funds

Boston, Massachusetts

Dated: October 1, 2001

COMBINED PROXY STATEMENT AND PROSPECTUS

SUNAMERICA STRATEGIC INVESTMENT SERIES, INC.
NORTH AMERICAN FUNDS

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JOINT SPECIAL MEETING OF SHAREHOLDERS OF
STOCK INDEX FUND
SCIENCE & TECHNOLOGY FUND
AGGRESSIVE GROWTH LIFESTYLE FUND
MODERATE GROWTH LIFESTYLE FUND
AND
CONSERVATIVE GROWTH LIFESTYLE FUND
OF
NORTH AMERICAN FUNDS

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NOVEMBER 7, 2001

This Proxy Statement and Prospectus is furnished to you because you are a
shareholder of one or more of the North American Funds referenced above. The
Funds are holding a Joint Special Meeting of Shareholders (the "Meeting") on
November 7, 2001 to consider the proposals described in this Proxy Statement
and Prospectus.

This Proxy Statement and Prospectus describes proposals to approve or
disapprove (i) a new investment advisory agreement with American General Asset
Management Corp. ("AGAM") for your Fund, and (ii) if applicable, a new
subadvisory agreement between AGAM and American General Investment Management,
L.P. ("AGIM") or an affiliate thereof (collectively, "New AGIM") for your Fund.
The terms of the new investment advisory agreement and new subadvisory
agreement are the same in all material respects as your Fund's previous
investment advisory agreement with AGAM and your Fund's previous subadvisory
agreement between AGAM and AGIM. The proposal relating to the new subadvisory
agreement does not apply to the Science & Technology Fund, which is not
subadvised by AGIM.

Your Board of Trustees is seeking your proxy to vote in favor of these
proposals.

In addition, your Board of Trustees is seeking your approval of a
transaction involving your Fund. Under the proposal, your Fund would reorganize
with a comparable portfolio of SunAmerica Strategic Investment Series, Inc., as
set forth in the chart below. If this reorganization is approved by
shareholders, you will become a shareholder of the SunAmerica fund listed
opposite your Fund's name.

Your Fund SunAmerica Fund
--------- ---------------

Stock Index Fund SunAmerica Stock Index Fund
Science & Technology Fund SunAmerica Science & Technology Fund
Aggressive Growth LifeStyle Fund SunAmerica Aggressive Growth LifeStage Fund
Moderate Growth LifeStyle Fund SunAmerica Moderate Growth LifeStage Fund
Conservative Growth LifeStyle Fund SunAmerica Conservative Growth LifeStage Fund

This Proxy Statement and Prospectus serves as a prospectus of SunAmerica
Strategic Investment Series, Inc. under the Securities Act of 1933, as amended
(the "Securities Act"), in connection with the issuance of shares to you
pursuant to the terms of the reorganizations.

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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION, NOR HAS THE COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROXY STATEMENT AND PROSPECTUS.
ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

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The Date of this Proxy Statement and Prospectus is October 1, 2001.

Both North American Funds and SunAmerica Strategic Investment Series, Inc.
are open-end series management investment companies. North American Funds is
organized as a Massachusetts business trust, and SunAmerica Strategic
Investment Series, Inc. is organized as a Maryland corporation.

Each of the SunAmerica funds listed above is being organized as a separate
investment portfolio of SunAmerica Strategic Investment Series, Inc. for the
purpose of accomplishing the applicable reorganization and has not yet
commenced operations. This Proxy Statement and Prospectus sets forth concisely
the information about SunAmerica Strategic Investment Series, Inc. that you
should know before considering a reorganization and should be retained for
future reference. North American Funds has authorized the solicitation of
proxies solely on the basis of this Proxy Statement and Prospectus and the
accompanying documents.

The following document is included in the package of documents that you
received with this Proxy Statement and Prospectus:

. The prospectus relating to SunAmerica Strategic Investment Series, Inc.,
dated February 28, 2001, as supplemented (the "Acquiring Funds
Prospectus"). This document is incorporated herein by reference (legally
considered to be a part of this Proxy Statement and Prospectus).

Additional information about the proposed transactions is contained in a
statement of additional information relating to this Proxy Statement and
Prospectus (the "Statement of Additional Information") and is on file with the
Securities and Exchange Commission (the "Commission"). The Statement of
Additional Information is available without charge, upon request by calling one
of the toll free numbers set forth below or by writing North American Funds or
SunAmerica Strategic Investment Series, Inc. at the address set forth below.
The Statement of Additional Information, dated October 1, 2001, is incorporated
by reference into this Proxy Statement and Prospectus.

Other documents containing information about the Funds have been filed with
the Commission. These other documents are available without charge by writing
to the address or calling the toll free number set forth below:

If they relate to North American Funds: If they relate to SunAmerica Strategic Investment
Series, Inc.:

North American Funds SunAmerica Strategic Investment Series, Inc.
286 Congress Street The SunAmerica Center
Boston, Massachusetts 02210 733 Third Avenue
1-800-872-8037 New York, New York 10017
1-800-858-8850

These documents are:

. The statement of additional information relating to SunAmerica Strategic
Investment Series, Inc., dated February 28, 2001, as supplemented (the
"Acquiring Funds Statement").

. The preliminary prospectuses relating to SunAmerica Strategic Investment
Series, Inc., subject to completion and dated August 15, 2001, as
supplemented.

. The preliminary statement of additional information relating to
SunAmerica Strategic Investment Series, Inc., subject to completion and
dated August 15, 2001, as supplemented.

A statement of additional information relating to the North American Funds,
dated March 1, 2001, as supplemented (the "Acquired Funds Statement").

. The prospectuses relating to the North American Funds, each dated March
1, 2001, as supplemented (the "Acquired Funds Prospectuses"). These
documents are incorporated herein by reference (legally considered to be
a part of this Proxy Statement and Prospectus).

. The Annual Report to Shareholders of North American Funds for the year
ended October 31, 2000 and the Semi-Annual Report to Shareholders of
North American Funds for the six month period ended April 30, 2001.

The Commission maintains a web site (http://www.sec.gov) that contains the
Statement of Additional Information, the Acquiring Funds Prospectus, the
Acquired Funds Prospectuses, the Acquiring Funds Statement, the Acquired Funds
Statement, other material incorporated by reference and other information
regarding the Funds.

The address of the principal executive offices of SunAmerica Strategic
Investment Series, Inc. is The SunAmerica Center, 733 Third Avenue, New York,
New York 10017, the telephone number is 1-800-858-8850 and the web address is
http://www.sunamericafunds.com. The address of the principal executive offices
of North American Funds is 286 Congress Street, Boston, Massachusetts 02210,
the telephone number is 1-800-872-8037 and the web address is
http://www.northamericanfunds.com.

The shareholders solicited and entitled to vote on Proposals 1a, 1b, 2a, 2b,
2c, 2d and 2e of this Proxy Statement and Prospectus are outlined in the
following table:

Proposal Fund
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1. (a) Approval of New Investment All North American Funds referenced
Advisory Agreement above, each voting separately
(b) Approval of New Subadvisory All Acquired Funds (other than the NAF
Agreement Science & Technology Fund), each
voting separately
2. (a) Approval of Agreement and Plan
of Reorganization relating to
Stock Index Fund Stock Index Fund
(b) Approval of Agreement and Plan Science & Technology Fund
of Reorganization relating to
Science & Technology Fund
(c) Approval of Agreement and Plan Aggressive Growth LifeStyle Fund
of Reorganization relating to
Aggressive Growth LifeStage
Fund
(d) Approval of Agreement and Plan Moderate Growth LifeStyle Fund
of Reorganization relating to
Moderate Growth LifeStage Fund
(e) Approval of Agreement and Plan Conservative Growth LifeStyle Fund
of Reorganization relating to
Conservative Growth LifeStage
Fund

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TABLE OF CONTENTS

Page
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INTRODUCTION............................................................. 1

SUMMARY.................................................................. 3
THE AIG MERGER AND THE NEW INVESTMENT ADVISORY AND SUBADVISORY
AGREEMENTS.............................................................. 3

THE REORGANIZATIONS...................................................... 4
What Shareholders of an Acquired Fund Will Receive in a Reorganization... 4
Reasons for the Reorganizations.......................................... 4
FEE TABLES AND EXAMPLES.................................................. 6
THE FUNDS................................................................ 19
Business of the Acquired Funds......................................... 19
Business of the Acquiring Funds........................................ 19
Comparison of the Funds................................................ 19

PRINCIPAL RISK FACTORS AND SPECIAL CONSIDERATIONS........................ 28
PRINCIPAL RISKS OF INVESTING IN THE ACQUIRED FUNDS, ACQUIRING FUNDS AND
UNDERLYING FUNDS........................................................ 28
All Acquired Funds, Acquiring Funds and Underlying Funds............... 28
Stock Index Funds......................................................
Science & Technology Funds............................................. 29
Growth LifeStage Funds and Underlying Funds............................ 29

PROPOSAL NOS. 1(a) AND (b): APPROVAL OF THE NEW INVESTMENT ADVISORY
AGREEMENT AND NEW SUBADVISORY AGREEMENT.................................. 32
THE AIG MERGER AND THE NEW INVESTMENT ADVISORY AGREEMENT AND NEW
SUBADVISORY AGREEMENT.................................................... 32
Board Considerations................................................... 32

PROPOSAL NO. 1(a): APPROVAL OF THE NEW INVESTMENT ADVISORY AGREEMENT..... 34

THE NEW INVESTMENT ADVISORY AGREEMENT.................................... 34
Description of the New Investment Advisory Agreement................... 34
Additional Information About AGAM...................................... 34

PROPOSAL NO. 1(b): APPROVAL OF THE NEW SUBADVISORY AGREEMENT............. 37

THE NEW SUBADVISORY AGREEMENT............................................ 37
Description of the New Subadvisory Agreement........................... 37
Additional Information About AGIM...................................... 38

PROPOSAL NOS. 2(a)-(e): APPROVAL OF THE PLANS............................ 39

COMPARISON OF THE FUNDS.................................................. 39
Investment Policies.................................................... 39
Directors and Officers................................................. 41
Management Arrangements................................................ 44
Distribution and Shareholder Servicing Arrangements.................... 47
Other Service Agreements with Affiliates............................... 48
Purchase, Exchange and Redemption of Shares............................ 48
Performance............................................................ 52
Shareholder Rights..................................................... 53
Tax Information........................................................ 54
Portfolio Transactions................................................. 54
Portfolio Turnover..................................................... 54
Additional Information................................................. 54

Page
----

THE REORGANIZATIONS....................................................... 56
General................................................................. 56
Terms of the Plans...................................................... 56
NAF Board Considerations: Potential Benefits to Shareholders as a Result
of the Reorganizations.................................................. 58
Federal Income Tax Consequences of the Reorganizations.................. 61
Capitalization.......................................................... 62

GENERAL................................................................... 63

INFORMATION CONCERNING THE MEETING........................................ 63
Date, Time and Place of Meeting......................................... 63
Solicitation, Revocation and Use of Proxies............................. 63
Record Date and Outstanding Shares...................................... 63
Security Ownership of Certain Beneficial Owners and Management of the
Funds................................................................... 64
Voting Rights and Required Vote......................................... 69

ADDITIONAL INFORMATION.................................................... 69

LEGAL PROCEEDINGS......................................................... 70

LEGAL OPINIONS............................................................ 70

EXPERTS................................................................... 70

SHAREHOLDER PROPOSALS..................................................... 70

EXHIBIT IA................................................................ IA-1
EXHIBIT IB................................................................ IB-1
EXHIBIT II................................................................ II-1

INTRODUCTION

This Proxy Statement and Prospectus is furnished in connection with the
solicitation of proxies on behalf of the Board of Trustees of North American
Funds (the "NAF Board") for use at the Meeting to be held at the principal
executive offices of North American Funds, 286 Congress Street, Boston,
Massachusetts 02210 on November 7, 2001, at 10:00 a.m., Eastern Time. The
mailing address for the North American Funds is 286 Congress Street, Boston,
Massachusetts 02210. The approximate mailing date of this Proxy Statement and
Prospectus is October 5, 2001.

Before we describe the proposals any further, we need to define certain
words or phrases that are used in this Proxy Statement and Prospectus:

Acquired Fund: Your Fund, which is a portfolio of North American Funds.

Acquiring Fund: The portfolio of SunAmerica Strategic Investment Series,
Inc. that is acquiring a comparable portfolio of North American Funds.

Aggressive Growth LifeStage Combined Fund: The SunAmerica Aggressive
Growth LifeStage Fund after the Reorganization.

Aggressive Growth LifeStage Funds: The Aggressive Growth LifeStyle Fund
of North American Funds and the SunAmerica Aggressive Growth LifeStage
Fund.

Combined Fund: An Acquiring Fund after completion of the Reorganization.

Conservative Growth LifeStage Combined Fund: The SunAmerica Conservative
Growth LifeStage Fund after the Reorganization.

Conservative Growth LifeStage Funds: The Conservative Growth LifeStyle
Fund of North American Funds and the SunAmerica Conservative Growth
LifeStage Fund.

Fund: Either the Acquired Fund or Acquiring Fund, depending on the
context.

Growth LifeStage Funds: The Aggressive Growth LifeStage Funds, the
Conservative Growth LifeStage Funds, and the Moderate Growth LifeStage
Funds.

Investment Company Act: The Investment Company Act of 1940, as amended.

Moderate Growth LifeStage Combined Fund: The SunAmerica Moderate Growth
LifeStage Fund after the Reorganization.

Moderate Growth LifeStage Funds: The Moderate Growth LifeStyle Fund of
North American Funds and the SunAmerica Moderate Growth LifeStage Fund.

NAF Aggressive Growth LifeStyle Fund: The Aggressive Growth LifeStyle
Fund of North American Funds.

NAF Conservative Growth LifeStyle Fund: The Conservative Growth
LifeStyle Fund of North American Funds.

NAF Growth LifeStyle Funds: The NAF Aggressive Growth LifeStyle Fund,
The NAF Conservative Growth LifeStyle Fund and the NAF Moderate Growth
LifeStyle Fund.

NAF Moderate Growth LifeStyle Fund: The Moderate Growth LifeStyle Fund
of North American Funds.

NAF Science & Technology Fund: The Science & Technology Fund of North
American Funds.

NAF Stock Index Fund: The Stock Index Fund of North American Funds.

Plan: The Agreement and Plan of Reorganization, which sets forth the
terms of each Reorganization and is being submitted for shareholder
approval.

Reorganization: The transaction through which an Acquired Fund will be
acquired by an Acquiring Fund and shareholders of an Acquired Fund will
become shareholders of an Acquiring Fund.

Science & Technology Combined Fund: The SunAmerica Science & Technology
Fund after the Reorganization.

Science & Technology Funds: The Science & Technology Fund of North
American Funds and the SunAmerica Science & Technology Fund.

Stock Index Combined Fund: The SunAmerica Stock Index Fund after the
Reorganization.

Stock Index Funds: The Stock Index Fund of North American Funds and the
SunAmerica Stock Index Fund.

SunAmerica Growth LifeStage Funds: The SunAmerica Aggressive Growth
LifeStage Fund, SunAmerica Conservative Growth LifeStage Fund and Moderate
Growth LifeStage Fund.

SUMMARY

The following is a summary of certain information contained elsewhere in
this Proxy Statement and Prospectus (including documents incorporated by
reference) and is qualified in its entirety by reference to the more complete
information contained in this Proxy Statement and Prospectus and in the forms
of the New Investment Advisory Agreement, the New Subadvisory Agreement and the
Plans, attached hereto as Exhibits IA, IB and II, respectively.

THE AIG MERGER AND THE NEW INVESTMENT
ADVISORY AND SUBADVISORY AGREEMENTS

On August 29, 2001, American International Group, Inc. ("AIG") acquired
American General Corporation ("American General"), the parent company of AGAM
and AGIM (the "AIG Merger"). As a result of the AIG Merger, AGAM and AGIM
became subsidiaries of AIG. AIG is also the parent company of SunAmerica Asset
Management Corp. ("SAAMCo").

As a result of the AIG Merger, applicable law requires shareholder approval
of a new investment advisory agreement (the "New Investment Advisory
Agreement") with AGAM for your Fund and shareholder approval of a new
subadvisory agreement (the "New Subadvisory Agreement" and together with the
New Investment Advisory Agreement, the "New Agreements") between AGAM and New
AGIM, an affiliate of AGAM, for each Fund (other than the NAF Science &
Technology Fund). The terms of the New Investment Advisory Agreement and New
Subadvisory Agreement are the same in all material respects as your Fund's
previous investment advisory agreement with AGAM (the "Previous Investment
Advisory Agreement") and previous subadvisory agreement between AGAM and AGIM
(the "Previous Subadvisory Agreement"). See "Proposal No. 1(a): Approval of the
New Investment Advisory Agreement" below for a description of the New
Investment Advisory Agreement and the services to be provided by AGAM
thereunder, and "Proposal No. 1(b): Approval of the New Subadvisory Agreement"
below for a description of the New Subadvisory Agreement and the services to be
provided by New AGIM thereunder.

In connection with its approval of the New Agreements, the NAF Board
received a presentation relating to AIG and SAAMCo, as well as a presentation
from AGAM. The NAF Board considered that the AIG Merger did not involve any
changes in the overall form of the advisory or subadvisory contracts, the
advisory fees, or any of the Acquired Funds' objectives or policies. The NAF
Board also considered that AGAM and SAAMCo had indicated that while they
intended to propose the Reorganizations to the NAF Board at a subsequent
meeting, until such Reorganizations were approved and consummated, SAAMCo and
AIG represented there would be no material change in the nature and quality of
services provided by AGAM. As part of its deliberations, the NAF Board took
into account the following, among other factors: the nature and quality of the
services provided or reasonably anticipated to be provided and the results
achieved or reasonably anticipated to be achieved by AGAM and/or New AGIM; the
amount and structure of investment advisers' fees generally and the fees
payable under the New Agreements; the financial strength of AIG; the
management, personnel and operations of AIG and SAAMCo; the commitment of AIG
to the financial services industry; and the structure of the AIG Merger.

In addition, the NAF Board considered the fact that at some point after
consummation of the AIG Merger, the operations of AGIM might be consolidated
with those of another affiliate within the AIG group of companies to eliminate
duplication and attempt to create economies of scale within the organization.
The NAF Board was assured that any such internal reorganization would not
result in a change in the personnel responsible for providing services to the
applicable Acquired Funds or in the nature or quality of those services.
Accordingly, the NAF Board approved the New Subadvisory Agreement with AGIM or
any affiliate that may

in the future conduct the advisory business previously conducted by AGIM
(previously defined collectively as "New AGIM").

AGAM and AGIM are wholly owned subsidiaries of American General. Prior to
the AIG Merger, American General was one of the nation's largest diversified
financial services organizations with assets of approximately $128 billion and
market capitalization of $23 billion at June 30, 2001. SAAMCo is the investment
adviser for the Acquiring Funds. SAAMCo has been in the business of investment
management since 1982 and as of June 30, 2001, managed, advised and/or
administered approximately $28.5 billion of assets. AIG, SAAMCo's parent, a
Delaware corporation, is a holding company which, through its subsidiaries, is
engaged in a broad range of insurance and insurance-related activities and
financial services in the United States and abroad.

THE REORGANIZATIONS

What Shareholders of an Acquired Fund Will Receive in a Reorganization

If shareholders approve their Fund's Reorganization and the Reorganization
takes place:

. The Acquiring Fund will acquire substantially all of the assets and
assume substantially all of the liabilities of the Acquired Fund;

. Shareholders of the Acquired Fund will become shareholders of the
Acquiring Fund;

. Shareholders holding Class A, Class B, Class C and Institutional Class I
shares of the Acquired Fund will receive Class A, Class B, Class II and
Class I shares, respectively, of the Acquiring Fund (the "Corresponding
Shares"); and

. Corresponding Shares received by shareholders of the Acquired Fund will
have the same aggregate net asset value as the shares of the Acquired
Fund held immediately prior to the Reorganization.

No sales charges will be imposed on the Corresponding Shares issued in
connection with the Reorganizations. Each Reorganization has been structured
with the intention that it qualify for Federal income tax purposes as a tax-
free reorganization under the Internal Revenue Code of 1986, as amended (the
"Code"). This means that, in the opinion of counsel, no gain or loss will be
recognized by a shareholder of an Acquired Fund for Federal income tax purposes
as a result of a Reorganization.

Reasons for the Reorganizations

On August 2, 2001, the NAF Board unanimously approved each Reorganization,
subject to shareholder approval and completion of the AIG Merger. The NAF
Board, including all of the NAF Independent Trustees (as defined below), has
determined that each Reorganization is in the best interests of the respective
Acquired Fund and its shareholders. In addition, the NAF Board, including all
of the NAF Independent Trustees, has determined that the interests of existing
shareholders of each Acquired Fund will not be diluted as a result of effecting
the respective Reorganization because each such shareholder will receive
Corresponding Shares of the Acquiring Fund having an aggregate net asset value
equal to the aggregate net asset value of his or her shares of the Acquired
Fund outstanding as of the Valuation Time (as defined in the Plans). The NAF
Independent Trustees are the Trustees who are not "interested persons" of North
American Funds (within the meaning of the Investment Company Act).

The NAF Board unanimously recommends that you vote FOR the Plan relating to
the Reorganization involving your Fund. Your Board of Trustees has based this
recommendation on its consideration of the principal reasons underlying each
Reorganization, including the following:

. the fact that following each Reorganization, shareholders of each
Acquired Fund would remain invested in a mutual fund having substantially
the same or similar investment objective and similar investment
techniques;

. the fees and expenses of the Acquired Funds, the Acquiring Funds and the
Combined Funds;

. potential benefits to shareholders likely to result from each
Reorganization, such as the potential for reduced operating expenses over
time due to economies of scale; and

. the fact that the Reorganizations will not result in dilution of the
interests of Acquired Fund shareholders.

For a more detailed discussion of the factors considered by your Board in
approving the Reorganizations, see "Proposals Nos. 2(a)-(e): The
Reorganizations" below.

If all of the requisite approvals are obtained and certain conditions are
either met or waived, it is anticipated that (i) AGAM will continue to serve as
the investment adviser of the Acquired Funds, New AGIM will continue to serve
as subadviser to each of the Acquired Funds except the NAF Science & Technology
Fund, and T. Rowe Price Associates, Inc. ("T. Rowe Price") will continue to
serve as subadviser to the NAF Science & Technology Fund, until the closing of
the Reorganizations (which is currently anticipated to occur during the fourth
calendar quarter of 2001), (ii) the Reorganizations will occur as soon as
practicable thereafter, provided that the Funds have obtained prior to that
time an opinion of counsel concerning the tax consequences of the
Reorganizations as set forth in the Plans, and (iii) after the consummation of
the Reorganizations, SAAMCo will manage the assets of the Acquired Funds as
part of the Combined Funds, with New AGIM serving as subadviser to the Stock
Index Combined Fund and T. Rowe Price serving as subadviser to the Science &
Technology Combined Fund. The Plans may be terminated, and the Reorganizations
abandoned, whether before or after the requisite approval by the shareholders
of the Acquired Funds, at any time prior to the Closing Date (as defined
herein), (i) by mutual agreement of the NAF Board and the Board of Directors of
SunAmerica Strategic Investment Series, Inc. (the "SunAmerica Board"); (ii) by
an Acquired Fund if any condition to such Acquired Fund's obligations has not
been fulfilled or waived; or (iii) by an Acquiring Fund if any condition to
such Acquiring Fund's obligations has not been fulfilled or waived.

FEE TABLES AND EXAMPLES

Actual Fee Table for Shareholders of each of the Acquired Funds+ and each of
the Acquiring Funds

(as of April 30, 2001) and Pro Forma Fee Table for each of the Combined Funds

(as of April 30, 2001)*

Institutional Class I/
Class A Shares Class B Shares Class C/II Shares Class I Shares
--------------------------- --------------------------- --------------------------- ---------------------------
Actual Pro Forma Actual Pro Forma Actual Pro Forma Actual Pro Forma
----------------- --------- ----------------- --------- ----------------- --------- ----------------- ---------
NAF Stock NAF Stock NAF Stock NAF Stock
Stock SunAmerica Index Stock SunAmerica Index Stock SunAmerica Index Stock SunAmerica Index
Index Stock Combined Index Stock Combined Index Stock Combined Index Stock Combined
Fund Index Fund Fund Fund Index Fund Fund Fund Index Fund Fund Fund Index Fund Fund
----- ---------- --------- ----- ---------- --------- ----- ---------- --------- ----- ---------- ---------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ 5.75% 5.75% 5.75% None None None None 1.00% 1.00% None None None
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ None None None 5.00% 5.00% 5.00% 1.00% 1.00% 1.00% None None None
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None None None None None None None None None None
Redemption
Fee(3)........... None None None None None None None None None None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.27% 0.27% 0.27% 0.27% 0.27% 0.27% 0.27% 0.27% 0.27% 0.27% 0.27% 0.27%
Distribution
and/or Service
(12b-1)
Fees(4)......... 0.35% 0.35% 0.35% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00% None None None
Other Expenses.. 0.55% 0.74% 0.74% 0.55% 0.66% 0.66% 0.55% 1.19% 1.19% 0.80% 0.99% 0.99%
Total Annual Fund
Operating
Expenses Before
Expense
Reimbursement.... 1.17% 1.36% 1.36% 1.82% 1.93% 1.93% 1.82% 2.46% 2.46% 1.07% 1.26% 1.26%
Expense
Reimbursement.... 0.42% 0.61% 0.61% 0.42% 0.53% 0.53% 0.42% 1.06% 1.06% 0.42% 0.61% 0.61%
Net
Expenses(5)(6)... 0.75% 0.75% 0.75% 1.40% 1.40% 1.40% 1.40% 1.40% 1.40% 0.65% 0.65% 0.65%

These examples are intended to help you compare the cost of investing in the
Stock Index Funds with the cost of investing in other mutual funds.

Examples:

An investor would pay the following expenses on a $10,000 investment,
assuming (1) the Total Annual Fund Operating Expenses set forth in the table
above for the relevant Fund and (2) a 5% annual return throughout the period.

Cumulative Expenses
Paid for the Period of:
-----------------------------------
1 Year 3 Years 5 Years 10 Years (9)
------ ------- ------- ------------

Expenses if you did redeem your shares at
the end of the period:
Class A
NAF Stock Index Fund(8)................. $647 $886 $1,143 $1,878
SunAmerica Stock Index Fund(8).......... $647 $801 $ 968 $1,452
Pro Forma Stock Index Combined
Fund+(8)............................... $647 $801 $ 968 $1,452
Class B
NAF Stock Index Fund(8)................. $643 $932 $1,146 $1,932
SunAmerica Stock Index Fund(8).......... $643 $743 $ 966 $1,502
Pro Forma Stock Index Combined
Fund+(8)............................... $643 $743 $ 966 $1,502
Class C/Class II
NAF Stock Index Fund(8)................. $243 $532 $ 946 $2,103
SunAmerica Stock Index Fund(8).......... $341 $539 $ 858 $1,763
Pro Forma Stock Index Combined
Fund+(8)............................... $341 $539 $ 858 $1,763
Institutional Class I/Class I
NAF Stock Index Fund(8)................. $ 66 $299 $ 549 $1,268
SunAmerica Stock Index Fund(8).......... $ 66 $208 $ 362 $ 810
Pro Forma Stock Index Combined
Fund+(8)............................... $ 66 $208 $ 362 $ 810

These examples are intended to help you compare the cost of investing in the
Stock Index Funds with the cost of investing in other mutual funds.

Examples:

An investor would pay the following expenses on a $10,000 investment,
assuming (1) the Total Annual Fund Operating Expenses set forth in the Table
above for the relevant Fund and (2) a 5% annual return throughout the period.

Cumulative Expenses Paid
for the Period of:
----------------------------------
1 Year 3 Years 5 Years 10 Years(9)
------ ------- ------- -----------

Expenses if you did not redeem your shares
at the end of the period:
Class A
NAF Stock Index Fund(8).................. $647 $886 $1,143 $1,878
SunAmerica Stock Index Fund(8)........... $647 $801 $ 968 $1,452
Pro Forma Stock Index Combined Fund+(8).. $647 $801 $ 968 $1,452
Class B
NAF Stock Index Fund(8).................. $143 $532 $ 946 $1,932
SunAmerica Stock Index Fund(8)........... $143 $443 $ 766 $1,502
Pro Forma Stock Index Combined Fund+(8).. $143 $443 $ 766 $1,502
Class C/Class II
NAF Stock Index Fund(8).................. $143 $532 $ 946 $2,103
SunAmerica Stock Index Fund(8)........... $241 $539 $ 858 $1,763
Pro Forma Stock Index Combined Fund+(8).. $241 $539 $ 858 $1,763
Institutional Class I/Class I
NAF Stock Index Fund(8).................. $ 66 $299 $ 549 $1,268
SunAmerica Stock Index Fund(8)........... $ 66 $208 $ 362 $ 810
Pro Forma Stock Index Combined Fund+(8).. $ 66 $208 $ 362 $ 810

Actual Fee Table for Shareholders of each of the Acquired Funds+ and each of
the Acquiring Funds

(as of April 30, 2001) and Pro Forma Fee Table for each of the Combined Funds

(as of April 30, 2001)*

Class A Shares Class B Shares Class C/ II Shares
-------------------------------- -------------------------------- --------------------------------
Actual Pro Forma Actual Pro Forma Actual Pro Forma
--------------------- ---------- --------------------- ---------- --------------------- ----------
NAF SunAmerica Science & NAF SunAmerica Science & NAF SunAmerica Science &
Science & Science & Technology Science & Science & Technology Science & Science & Technology
Technology Technology Combined Technology Technology Combined Technology Technology Combined
Fund Fund Fund Fund Fund Fund Fund Fund Fund
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ 5.75% 5.75% 5.75% None None None None 1.00% 1.00%
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ None None None 5.00% 5.00% 5.00% 1.00% 1.00% 1.00%
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None None None None None None None
Redemption
Fee(3)........... None None None None None None None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.90% 0.90% 0.90% 0.90% 0.90% 0.90% 0.90% 0.90% 0.90%
Distribution
and/or Service
(12b-1)
Fees(4)......... 0.35% 0.35% 0.35% 1.00% 1.00% 1.00% 1.00% 1.00% 1.00%
Other Expenses.. 0.25% 1.22% 1.22% 0.25% 1.04% 1.04% 0.25% 1.71% 1.71%
Total Annual Fund
Operating
Expenses Before
Expense
Reimbursement.... 1.50% 2.47% 2.47% 2.15% 2.94% 2.94% 2.15% 3.61% 3.61%
Expense
Reimbursement.... -- 0.97% 0.97% -- 0.79% 0.79% -- 1.46% 1.46%
Net
Expenses(5)(6)... 1.50% 1.50% 1.50% 2.15% 2.15% 2.15% 2.15% 2.15% 2.15%

Institutional Class I/Class I
Shares
--------------------------------
Actual Pro Forma
--------------------- ----------
NAF SunAmerica Science &
Science & Science & Technology
Technology Technology Combined
Fund Fund Fund
---------- ---------- ----------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ None None None
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ None None None
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None
Redemption
Fee(3)........... None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.90% 0.90% 0.90%
Distribution
and/or Service
(12b-1)
Fees(4)......... None None None
Other Expenses.. 0.50% 5.40% 5.40%
Total Annual Fund
Operating
Expenses Before
Expense
Reimbursement.... 1.40% 6.30% 6.30%
Expense
Reimbursement.... -- 4.90% 4.90%
Net
Expenses(5)(6)... 1.40% 1.40% 1.40%

These examples are intended to help you compare the cost of investing in the
Science & Technology Funds with the cost of investing in other mutual funds.

Examples:

Cumulative Expenses Paid
for the Period of:
---------------------------------
3 5
1 Year Years Years 10 Years (9)
------ ------ ------ ------------

Expenses if you did redeem your shares at
the end of the period:
Class A
NAF Science & Technology Fund(8).......... $719 $1,022 $1,346 $2,263
SunAmerica Science & Technology Fund(8)... $719 $1,022 $1,346 $2,263
Pro Forma Science & Technology Combined
Fund+(8)................................. $719 $1,022 $1,346 $2,263
Class B
NAF Science & Technology Fund(8).......... $718 $1,073 $1,354 $2,318
SunAmerica Science & Technology Fund(8)... $718 $ 973 $1,354 $2,318
Pro Forma Science & Technology Combined
Fund+(8)................................. $718 $ 973 $1,354 $2,318
Class C/Class II
NAF Science & Technology Fund(8).......... $318 $ 673 $1,154 $2,483
SunAmerica Science & Technology Fund(8)... $416 $ 766 $1,243 $2,558
Pro Forma Science & Technology Combined
Fund+(8)................................. $416 $ 766 $1,243 $2,558
Institutional Class I/Class I
NAF Science & Technology Fund(8).......... $143 $ 443 $ 766 $1,680
SunAmerica Science & Technology Fund(8)... $143 $ 443 $ 766 $1,680
Pro Forma Science & Technology Combined
Fund+(8)................................. $143 $ 443 $ 766 $1,680

Cumulative Expenses Paid
for the Period of:
---------------------------------
3 5
1 Year Years Years 10 Years (9)
------ ------ ------ ------------

Expenses if you did not redeem your shares
at the end of the period:
Class A
NAF Science & Technology Fund(8).......... $719 $1,022 $1,346 $2,263
SunAmerica Science & Technology Fund(8)... $719 $1,022 $1,346 $2,263
Pro Forma Science & Technology Combined
Fund+(8)................................. $719 $1,022 $1,346 $2,263
Class B
NAF Science & Technology Fund(8).......... $218 $ 673 $1,154 $2,318
SunAmerica Science & Technology Fund(8)... $218 $ 673 $1,154 $2,318
Pro Forma Science & Technology Combined
Fund+(8)................................. $218 $ 673 $1,154 $2,318
Class C/Class II
NAF Science & Technology Fund(8).......... $218 $ 673 $1,154 $2,483
SunAmerica Science & Technology Fund(8)... $316 $ 766 $1,243 $2,558
Pro Forma Science & Technology Combined
Fund+(8)................................. $316 $ 766 $1,243 $2,558
Institutional Class I/Class I
NAF Science & Technology Fund(8).......... $143 $ 443 $ 766 $1,680
SunAmerica Science & Technology Fund(8)... $143 $ 443 $ 766 $1,680
Pro Forma Science & Technology Combined
Fund+(8)................................. $143 $ 443 $ 766 $1,680

Actual Fee Table for Shareholders of each of the Acquired Funds+ and each of
the Acquiring Funds

(as of April 30, 2001) and Pro Forma Fee Table for each of the Combined Funds

(as of April 30, 2001)*

Class A Shares Class B Shares Class C/II Shares
-------------------------------- -------------------------------- --------------------------------
Actual Pro Forma Actual Pro Forma Actual Pro Forma
--------------------- ---------- --------------------- ---------- --------------------- ----------
NAF SunAmerica Aggressive NAF SunAmerica Aggressive NAF SunAmerica Aggressive
Aggressive Aggressive Growth Aggressive Aggressive Growth Aggressive Aggressive Growth
Growth Growth LifeStage Growth Growth LifeStage Growth Growth LifeStage
LifeStyle LifeStage Combined LifeStyle LifeStage Combined LifeStyle LifeStage Combined
Fund Fund Fund Fund Fund Fund Fund Fund Fund
---------- ---------- ---------- ---------- ---------- ---------- ---------- ---------- ----------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ 5.75% 5.75% 5.75% None None None None 1.00% 1.00%
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ None None None 5.00% 5.00% 5.00% 1.00% 1.00% 1.00%
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None None None None None None None
Redemption
Fee(3)........... None None None None None None None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%
Distribution
and/or Service
(12b-1)
Fees(4)......... 0.10% 0.10% 0.10% 0.75% 0.75% 0.75% 0.75% 0.75% 0.75%
Other Expenses.. None None None None None None None None None
Total Annual Fund
Operating
Expenses......... 0.20% 0.20% 0.20% 0.85% 0.85% 0.85% 0.85% 0.85% 0.85%
Estimated
Indirect
Expenses......... 1.45% 1.39% 1.39% 1.45% 1.39% 1.39% 1.45% 1.39% 1.39%
Total Combined
Annual
Expenses(7)...... 1.65% 1.59% 1.59% 2.30% 2.24% 2.24% 2.30% 2.24% 2.24%

Institutional Class I/Class I
Shares
--------------------------------
Actual Pro Forma
--------------------- ----------
NAF SunAmerica Aggressive
Aggressive Aggressive Growth
Growth Growth LifeStage
LifeStyle LifeStage Combined
Fund Fund Fund
---------- ---------- ----------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ None None None
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ None None None
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None
Redemption
Fee(3)........... None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.10% 0.10% 0.10%
Distribution
and/or Service
(12b-1)
Fees(4)......... None None None
Other Expenses.. None None None
Total Annual Fund
Operating
Expenses......... 0.10% 0.10% 0.10%
Estimated
Indirect
Expenses......... 1.45% 1.39% 1.39%
Total Combined
Annual
Expenses(7)...... 1.55% 1.49% 1.49%

These examples are intended to help you compare the cost of investing in the
Aggressive Growth LifeStage Funds with the cost of investing in other mutual
funds.

Examples:

Cumulative Expenses Paid
for the Period of:
--------------------------------
3 5
1 Year Years Years 10 Years(9)
------ ------ ------ -----------

Expenses if you did redeem your shares at the
end of the
period:
Class A
NAF Aggressive Growth LifeStyle Fund....... $733 $1,119 $1,529 $2,669
SunAmerica Aggressive Growth LifeStage
Fund...................................... $727 $1,048 $1,391 $2,356
Pro Forma Aggressive Growth LifeStage
Combined Fund+............................ $727 $1,048 $1,391 $2,356
Class B
NAF Aggressive Growth LifeStyle Fund....... $733 $1,174 $1,541 $2,726
SunAmerica Aggressive Growth LifeStage
Fund...................................... $727 $1,000 $1,400 $2,411
Pro Forma Aggressive Growth LifeStage
Combined Fund+............................ $727 $1,000 $1,400 $2,411
Class C/Class II
NAF Aggressive Growth LifeStyle Fund....... $333 $ 774 $1,341 $2,885
SunAmerica Aggressive Growth LifeStage
Fund...................................... $425 $ 793 $1,288 $2,649
Pro Forma Aggressive Growth LifeStage
Combined Fund+............................ $425 $ 793 $1,288 $2,649
Institutional Class I/Class I
NAF Aggressive Growth LifeStyle Fund....... $158 $ 546 $ 960 $2,115
SunAmerica Aggressive Growth LifeStage
Fund...................................... $152 $ 471 $ 813 $1,779
Pro Forma Aggressive Growth LifeStage
Combined Fund+............................ $152 $ 471 $ 813 $1,779

Cumulative Expenses Paid
for the Period of:
--------------------------------
3 5
1 Year Years Years 10 Years(9)
------ ------ ------ -----------

Expenses if you did not redeem your shares at
the end of the period:
Class A
NAF Aggressive Growth LifeStyle Fund....... $733 $1,119 $1,529 $2,669
SunAmerica Aggressive Growth LifeStage
Fund...................................... $727 $1,048 $1,391 $2,356
Pro Forma Aggressive Growth LifeStage
Combined Fund+............................ $727 $1,048 $1,391 $2,356
Class B
NAF Aggressive Growth LifeStyle Fund....... $233 $ 774 $1,341 $2,726
SunAmerica Aggressive Growth LifeStage
Fund...................................... $227 $ 700 $1,200 $2,411
Pro Forma Aggressive Growth LifeStage
Combined Fund+............................ $227 $ 700 $1,200 $2,411
Class C/Class II
NAF Aggressive Growth LifeStyle Fund....... $233 $ 774 $1,341 $2,885
SunAmerica Aggressive Growth LifeStage
Fund...................................... $325 $ 793 $1,288 $2,649
Pro Forma Aggressive Growth LifeStage
Combined Fund+............................ $325 $ 793 $1,288 $2,649
Institutional Class I/Class I
NAF Aggressive Growth LifeStyle Fund....... $158 $ 546 $ 960 $2,115
SunAmerica Aggressive Growth LifeStage
Fund...................................... $152 $ 471 $ 813 $1,779
Pro Forma Aggressive Growth LifeStage
Combined Fund+............................ $152 $ 471 $ 813 $1,779

Actual Fee Table for Shareholders of each of the Acquired Funds+

and each of the Acquiring Funds (as of April 30, 2001) and Pro Forma Fee Table
for each of the Combined Funds

(as of April 30, 2001)*

Class A Shares Class B Shares Class C/II Shares
------------------------------ ------------------------------ ------------------------------
Actual Pro Forma Actual Pro Forma Actual Pro Forma
-------------------- --------- -------------------- --------- -------------------- ---------
NAF SunAmerica Moderate NAF SunAmerica Moderate NAF SunAmerica Moderate
Moderate Moderate Growth Moderate Moderate Growth Moderate Moderate Growth
Growth Growth LifeStage Growth Growth LifeStage Growth Growth LifeStage
LifeStyle LifeStage Combined LifeStyle LifeStage Combined LifeStyle LifeStage Combined
Fund Fund Fund Fund Fund Fund Fund Fund Fund
--------- ---------- --------- --------- ---------- --------- --------- ---------- ---------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ 5.75% 5.75% 5.75% None None None None 1.00% 1.00%
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ None None None 5.00% 5.00% 5.00% 1.00% 1.00% 1.00%
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None None None None None None None
Redemption
Fee(3)........... None None None None None None None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%
Distribution
and/or Service
(12b-1)
Fees(4)......... 0.10% 0.10% 0.10% 0.75% 0.75% 0.75% 0.75% 0.75% 0.75%
Other Expenses.. None None None None None None None None None
Total Annual Fund
Operating
Expenses......... 0.20% 0.20% 0.20% 0.85% 0.85% 0.85% 0.85% 0.85% 0.85%
Estimated
Indirect
Expenses......... 1.39% 1.31% 1.31% 1.39% 1.31% 1.31% 1.39% 1.31% 1.31%
Total Combined
Annual
Expenses(7)...... 1.59% 1.51% 1.51% 2.24% 2.16% 2.16% 2.24% 2.16% 2.16%

Institutional Class I/Class I
Shares
------------------------------
Actual Pro Forma
-------------------- ---------
NAF SunAmerica Moderate
Moderate Moderate Growth
Growth Growth LifeStage
LifeStyle LifeStage Combined
Fund Fund Fund
--------- ---------- ---------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ None None None
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ None None None
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None
Redemption
Fee(3)........... None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.10% 0.10% 0.10%
Distribution
and/or Service
(12b-1)
Fees(4)......... None None None
Other Expenses.. None None None
Total Annual Fund
Operating
Expenses......... 0.10% 0.10% 0.10%
Estimated
Indirect
Expenses......... 1.39% 1.31% 1.31%
Total Combined
Annual
Expenses(7)...... 1.49% 1.41% 1.41%

These examples are intended to help you compare the cost of investing in the
Moderate Growth LifeStage Funds with the cost of investing in other mutual
funds.

Examples:

Cumulative Expenses Paid
for the Period of:
---------------------------------
3 5
1 Year Years Years 10 Years (9)
------ ------ ------ ------------

Expenses if you did redeem your shares at
the end of the period:
Class A
NAF Moderate Growth LifeStyle Fund........ $727 $1,088 $1,471 $2,544
SunAmerica Moderate Growth LifeStage
Fund..................................... $720 $1,025 $1,351 $2,273
Pro Forma Moderate Growth LifeStage
Combined Fund+........................... $720 $1,025 $1,351 $2,273
Class B
NAF Moderate Growth LifeStyle Fund........ $727 $1,141 $1,483 $2,600
SunAmerica Moderate Growth LifeStage
Fund..................................... $719 $ 976 $1,359 $2,328
Pro Forma Moderate Growth LifeStage
Combined Fund+........................... $719 $ 976 $1,359 $2,328
Class C/Class II
NAF Moderate Growth LifeStyle Fund........ $327 $ 741 $1,283 $2,761
SunAmerica Moderate Growth LifeStage
Fund..................................... $417 $ 769 $1,248 $2,568
Pro Forma Moderate Growth LifeStage
Combined Fund+........................... $417 $ 769 $1,248 $2,568
Institutional Class I/Class I
NAF Moderate Growth LifeStyle Fund........ $152 $ 513 $ 899 $1,981
SunAmerica Moderate Growth LifeStage
Fund..................................... $144 $ 446 $ 771 $1,691
Pro Forma Moderate Growth LifeStage
Combined Fund+........................... $144 $ 446 $ 771 $1,691

Cumulative Expenses Paid
for the Period of:
---------------------------------
3 5
1 Year Years Years 10 Years (9)
------ ------ ------ ------------

Expenses if you did not redeem your shares
at the end of the period:
Class A
NAF Moderate Growth LifeStyle Fund........ $727 $1,088 $1,471 $2,544
SunAmerica Moderate Growth LifeStage
Fund..................................... $720 $1,025 $1,351 $2,273
Pro Forma Moderate Growth LifeStage
Combined Fund+........................... $720 $1,025 $1,351 $2,273
Class B
NAF Moderate Growth LifeStyle Fund........ $227 $ 741 $1,283 $2,600
SunAmerica Moderate Growth LifeStage
Fund..................................... $219 $ 676 $1,159 $2,328
Pro Forma Moderate Growth LifeStage
Combined Fund+........................... $219 $ 676 $1,159 $2,328
Class C/Class II
NAF Moderate Growth LifeStyle Fund........ $227 $ 741 $1,283 $2,761
SunAmerica Moderate Growth LifeStage
Fund..................................... $317 $ 769 $1,248 $2,568
Pro Forma Moderate Growth LifeStage
Combined Fund+........................... $317 $ 769 $1,248 $2,568
Institutional Class I/Class I
NAF Moderate Growth LifeStyle Fund........ $152 $ 513 $ 899 $1,981
SunAmerica Moderate Growth LifeStage
Fund..................................... $144 $ 446 $ 771 $1,691
Pro Forma Moderate Growth LifeStage
Combined Fund+........................... $144 $ 446 $ 771 $1,691

Actual Fee Table for Shareholders of each of the Acquired Funds+ and each of
the Acquiring Funds (as of April 30, 2001) and Pro Forma Fee Table for each of
the Combined Funds (as of April 30, 2001)*

Class A Shares Class B Shares
-------------------------------------- --------------------------------------
Actual Pro Forma Actual Pro Forma
------------------------- ------------ ------------------------- ------------
NAF SunAmerica Conservative NAF SunAmerica Conservative
Conservative Conservative Growth Conservative Conservative Growth
Growth Growth LifeStage Growth Growth LifeStage
LifeStyle LifeStage Combined LifeStyle LifeStage Combined
Fund Fund Fund Fund Fund Fund
------------ ------------ ------------ ------------ ------------ ------------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ 5.75% 5.75% 5.75% None None None
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ None None None 5.00% 5.00% 5.00%
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None None None None
Redemption
Fee(3)........... None None None None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%
Distribution
and/or Service
(12b-1)
Fees(4)......... 0.10% 0.10% 0.10% 0.75% 0.75% 0.75%
Other Expenses.. None None None None None None
Total Annual Fund
Operating
Expenses......... 0.20% 0.20% 0.20% 0.85% 0.85% 0.85%
Estimated
Indirect
Expenses......... 1.33% 1.20% 1.20% 1.33% 1.20% 1.20%
Total Combined
Annual
Expenses(7)...... 1.53% 1.40% 1.40% 2.18% 2.05% 2.05%

Class C/II Shares Institutional Class I/Class I Shares
-------------------------------------- --------------------------------------
Actual Pro Forma Actual Pro Forma
------------------------- ------------ ------------------------- ------------
NAF SunAmerica Conservative NAF SunAmerica Conservative
Conservative Conservative Growth Conservative Conservative Growth
Growth Growth LifeStage Growth Growth LifeStage
LifeStyle LifeStage Combined LifeStyle LifeStage Combined
Fund Fund Fund Fund Fund Fund
------------ ------------ ------------ ------------ ------------ ------------

Shareholder Fees
(fees paid
directly from
your investment):
Maximum Sales
Charge (Load)
Imposed on
Purchases (as a
percentage of
offering
price)(1)........ None 1.00% 1.00% None None None
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower)(2)........ 1.00% 1.00% 1.00% None None None
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None None None None
Redemption
Fee(3)........... None None None None None None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.10% 0.10% 0.10% 0.10% 0.10% 0.10%
Distribution
and/or Service
(12b-1)
Fees(4)......... 0.75% 0.75% 0.75% None None None
Other Expenses.. None None None None None None
Total Annual Fund
Operating
Expenses......... 0.85% 0.85% 0.85% 0.10% 0.10% 0.10%
Estimated
Indirect
Expenses......... 1.33% 1.20% 1.20% 1.33% 1.20% 1.20%
Total Combined
Annual
Expenses(7)...... 2.18% 2.05% 2.05% 1.43% 1.30% 1.30%

These examples are intended to help you compare the cost of investing in the
Conservative Growth LifeStage Funds with the cost of investing in other mutual
funds.

Examples:

Cumulative Expenses Paid for
the Period of:
--------------------------------
3 5
1 Year Years Years 10 Years(9)
------ ------ ------ -----------

Expenses if you did redeem your shares at the
end of the period:
Class A
NAF Conservative Growth LifeStyle Fund..... $722 $1,060 $1,422 $2,436
SunAmerica Conservative Growth LifeStage
Fund...................................... $709 $ 993 $1,297 $2,158
Pro Forma Conservative Growth LifeStage
Combined Fund+............................ $709 $ 993 $1,297 $2,158
Class B
NAF Conservative Growth LifeStyle Fund..... $721 $1,113 $1,432 $2,492
SunAmerica Conservative Growth LifeStage
Fund...................................... $708 $ 943 $1,303 $2,213
Pro Forma Conservative Growth LifeStage
Combined Fund+............................ $708 $ 943 $1,303 $2,213
Class C/ Class II
NAF Conservative Growth LifeStyle Fund..... $321 $ 713 $1,232 $2,654
SunAmerica Conservative Growth LifeStage
Fund...................................... $406 $ 736 $1,192 $2,455
Pro Forma Conservative Growth LifeStage
Combined Fund+............................ $406 $ 736 $1,192 $2,455
Institutional Class I/Class I
NAF Conservative Growth LifeStyle Fund..... $146 $ 484 $ 846 $1,866
SunAmerica Conservative Growth LifeStage
Fund...................................... $132 $ 412 $ 713 $1,568
Pro Forma Conservative Growth LifeStage
Combined Fund+............................ $132 $ 412 $ 713 $1,568

Cumulative Expenses Paid for
the Period of:
--------------------------------
3 5
1 Year Years Years 10 Years(9)
------ ------ ------ -----------

Expenses if you did not redeem your shares at
the end of the period:
Class A
NAF Conservative Growth LifeStyle Fund..... $722 $1,060 $1,422 $2,436
SunAmerica Conservative Growth LifeStage
Fund...................................... $709 $ 993 $1,297 $2,158
Pro Forma Conservative Growth LifeStage
Combined Fund+............................ $709 $ 993 $1,297 $2,158
Class B
NAF Conservative Growth LifeStyle Fund..... $221 $ 713 $1,232 $2,492
SunAmerica Conservative Growth LifeStage
Fund...................................... $208 $ 643 $1,103 $2,213
Pro Forma Conservative Growth LifeStage
Combined Fund+............................ $208 $ 643 $1,103 $2,213
Class C/ Class II
NAF Conservative Growth LifeStyle Fund..... $221 $ 713 $1,232 $2,654
SunAmerica Conservative Growth LifeStage
Fund...................................... $306 $ 736 $1,192 $2,455
Pro Forma Conservative Growth LifeStage
Combined Fund+............................ $306 $ 736 $1,192 $2,455
Institutional Class I/Class I
NAF Conservative Growth LifeStyle Fund..... $146 $ 484 $ 846 $1,866
SunAmerica Conservative Growth LifeStage
Fund...................................... $132 $ 412 $ 713 $1,568
Pro Forma Conservative Growth LifeStage
Combined Fund+............................ $132 $ 412 $ 713 $1,568

--------

+ As reflected in the Acquired Funds Prospectuses.

* "Other Expenses," "Total Annual Fund Operating Expenses Before Expense
Reimbursement" (or "Total Fund Operating Expenses," as the case may be),
"Expense Reimbursement" (if applicable) and "Total Combined Annual Expenses"
(if applicable) in connection with each of the Acquiring Funds and each of
the Combined Funds have been estimated, since the Acquiring Funds have not
yet commenced operations.

(1) The front-end sales charge on Class A shares decreases with the size of the
purchase to 0% for purchases of $1 million or more.

(2) With respect to the Acquired Funds, (i) purchases of Class A shares of $1
million or more are subject to a CDSC of 1.00% on redemptions made within
one year of purchase, (ii) the CDSC on Class B shares applies only if
shares are redeemed within six years of their purchase in accordance with
the Acquired Funds' CDSC schedule set forth under "Proposals Nos. 2(a)-(e):
Approval of the Plans" and (iii) the CDSC on Class C shares applies only if
shares are redeemed within one year of their purchase. See the Acquired
Funds' Prospectuses for more information regarding the CDSCs applicable to
the Acquired Funds. The CDSC schedules applicable to Class A, Class B and
Class C shares of an Acquired Fund will continue to apply to the respective
Corresponding Shares received in the applicable Reorganization by
shareholders of a Combined Fund who were shareholders of the corresponding
Acquired Fund as of the date of the closing of such Reorganization (even if
you exchange your shares for shares of another fund distributed by SACS (as
defined below)). Future purchases of Class A, Class B or Class II shares of
a Combined Fund will be subject to the CDSC schedule applicable to the
Combined Fund.

With respect to the Acquiring Funds (and to future purchases of Class A,
Class B or Class II shares of the Combined Funds after the closing of the
Reorganizations), (i) purchases of Class A shares of $1 million or more are
subject to a CDSC on redemptions made within two years of purchase (1.00%
on shares sold within one year of purchase and 0.50% on shares sold after
the first year and within the second year after purchase), (ii) the CDSC on
Class B shares applies only if shares are redeemed within six years of
their purchase in accordance with the Acquiring Funds' CDSC schedule set
forth under "Proposals Nos. 2(a)-(e): Approval of the Plans" and (iii) the
CDSC on Class II shares applies only if shares are redeemed within eighteen
months of their purchase. See the Acquiring Funds' Prospectus for more
information about the CDSCs applicable to the Acquiring Funds (and hence,
the Combined Funds).

(3) In the case of the Acquiring Funds (and hence the Combined Funds) a $15.00
fee may be imposed on wire and overnight mail redemptions.

(4) Because these fees are paid out of a Fund's assets on an ongoing basis,
over time these fees will increase the cost of your investment and may cost
you more than paying other types of sales charges.

(5) With respect to the NAF Stock Index Fund and NAF Science & Technology Fund,
amounts reflect AGAM's contractual obligation to waive, and to the extent
necessary, reimburse certain fees and expenses of such Acquired Fund
through February 28, 2002. If shareholders of such Funds do not approve the
Reorganizations relating to their Fund, there is no assurance AGAM would
continue to provide such fee reductions and expense reimbursements past
such date.

(6) With respect to the SunAmerica Stock Index Fund and SunAmerica Science &
Technology Fund (and hence the respective Combined Funds), the SunAmerica
Board, including a majority of the Directors who are not "interested
persons" of SunAmerica Strategic Investment Series, Inc. (within the
meaning of the Investment Company Act (the "SunAmerica Independent
Directors"), approved the Acquiring Funds' (and hence the Combined Funds')
Investment Advisory and Management Agreement with SAAMCo subject to the net
expense ratios set forth above. SunAmerica will waive fees and reimburse
expenses should the Total Annual Fund Operating Expenses Before Expenses
Reimbursement be higher than the net expense ratio. SunAmerica may not
increase such ratios, which are contractually required by agreement with
the SunAmerica Board, without the approval of the SunAmerica Board,
including a majority of the SunAmerica Independent Directors. The expense
waivers and fee reimbursements will continue indefinitely, subject to
termination by the SunAmerica Board, including a majority of the SunAmerica
Independent Directors.

(7) Total Combined Annual Expenses for the NAF Growth LifeStyle Funds and the
SunAmerica Growth LifeStage Funds include the estimated indirect expenses
borne by each Fund in connection with its investments in the North
American Funds or SunAmerica Mutual Funds, as the case may be, in which
each invests ("Underlying Funds"). The estimates are based on expenses of
the Underlying Funds' Institutional Class I or Class I shares, as the case
may be, shown in the current or preliminary prospectus, as applicable, for
such shares, and assume allocation by the Funds of their assets among the
Underlying Funds as set forth below.

NAF NAF NAF
Aggressive Growth Moderate Growth Conservative Growth
LifeStyle Fund LifeStyle Fund LifeStyle Fund
----------------- --------------- -------------------

International Equity
Fund................... 25% 15% 8%
Small Cap Growth Fund... 20% 13% 8%
Mid Cap Value Fund...... 10% 9% 6%
Mid Cap Growth Fund..... 5% 3% 2%
Large Cap Growth Fund... 20% 15% 13%
Growth & Income Fund.... 10% 15% 13%
Core Bond Fund.......... 10% 30% 50%
High Yield Bond Fund.... 0% 0% 0%
--- --- ---
Total................. 100% 100% 100%

SunAmerica SunAmerica SunAmerica
Aggressive Growth Moderate Growth Conservative Growth
LifeStyle Fund LifeStyle Fund LifeStyle Fund
----------------- --------------- -------------------

SunAmerica Core Bond
Fund................... 5% 15% 15%
SunAmerica GNMA Fund.... 5% 15% 35%
SunAmerica High Yield
Bond Fund.............. 0% 0% 0%
SunAmerica International
Equity Fund............ 20% 15% 10%
SunAmerica Growth and
Income Fund............ 10% 15% 12%
SunAmerica Blue Chip
Growth Fund............ 20% 15% 12%
SunAmerica Growth
Opportunities Fund..... 10% 3% 2%
SunAmerica New Century
Fund................... 15% 10% 6%
SunAmerica Style Select
Series Focused Value
Portfolio.............. 15% 12% 8%
--- --- ---
Total................. 100% 100% 100%

Each Fund's actual expenses may be higher or lower as a result of the
allocation of their assets among the Underlying Funds, the expenses of the
Underlying Funds, and/or the Fund's own expenses.

+ Assuming the Reorganization had taken place on April 30, 2001.

(8) Expenses used for the example include fee waivers and expense
reimbursements described in footnotes (5) and/or (6) above under "--Fee
Tables."
(9) Class B shares generally convert to Class A shares approximately eight
years after purchase. Therefore, expense information for years 9 and 10 is
the same for both Class A and Class B shares.

The foregoing Fee Table is intended to assist investors in understanding the
costs and expenses that a shareholder bears directly or indirectly as compared
to the costs and expenses that would be borne by such investors on a pro forma
basis taking into account the consummation of the Reorganizations. All pro
forma amounts are based on what the estimated expenses of the Pro Forma
Combined Funds would be assuming the Reorganizations were completed on April
30, 2001.

The Examples set forth above assume reinvestment of all dividends and
distributions and utilize a 5% annual rate of return as mandated by Commission
regulations. The Examples should not be considered a representation of past or
future expenses or annual rates of return, and actual expenses or annual rates
of return may be more or less than those assumed for purposes of the Examples.
See "Proposals Nos. 2(a)-(e): Approval of the Plans".

THE FUNDS

Business of the Acquired Funds

Each Acquired Fund is organized as a separate investment portfolio or series
of North American Funds, a Massachusetts business trust, which was established
on September 28, 1988 pursuant to its Declaration of Trust.

Business of the Acquiring Funds

Each Acquiring Fund is a separate investment portfolio or series of
SunAmerica Strategic Investment Series, Inc., a Maryland corporation, which was
incorporated on December 16, 1998. Each of the Acquiring Funds is newly created
and has not yet commenced operations.

Comparison of the Funds

A discussion of the investment objectives and principal investment policies
of the Funds is set forth below. The investment objectives of each of the
Acquired Funds and Acquiring Funds are non-fundamental which means that they
may be changed without shareholder approval. The investment objectives and
investment policies of each Acquired Fund are substantially similar to those of
the relevant Acquiring Fund.

The discussion below uses the term "growth" approach. A growth strategy
focuses on securities considered to have a historical record of above-average
earnings growth; to have significant growth potential; to have above-average
earnings growth or the ability to sustain earnings growth; to offer proven or
unusual products or services; or to operate in industries experiencing
increasing demand. A value oriented philosophy is that of investing in
securities believed to be undervalued in the market.

As discussed below, each Growth LifeStage Fund follows a fund of funds
investment strategy based on the allocation of fund assets among underlying
mutual funds ("Underlying Funds"). A discussion of the investment objectives
and principal investment policies of the Underlying Funds is also set forth
below. The main difference between the respective Growth LifeStage Funds is the
Underlying Funds in which each Growth LifeStage Fund invests.

Stock Index Funds

Investment Objectives

Both Stock Index Funds seek to provide shareholders with investment results
that are similar to the total return of the Standard & Poor's 500 Composite
Stock Price Index (the "S&P 500 Index" or the "Index").

Investment Policies

The investment policies of both Stock Index Funds are substantially similar.

Strategies. Both Stock Index Funds invest in equity securities of companies
included in the S&P 500 Index. In doing so, both use a statistical sampling
technique known as "optimization" to invest in a sampling of stocks included in
the Index. This process selects stocks for each Fund so that various industry
weightings, market capitalizations and fundamental characteristics (e.g.,
price-to-book, price-to-earnings, debt-to-asset ratios

and dividend yields) closely approximate those of the Index as a whole. Each
Fund is compared to the Index monthly to identify "tracking differences." If a
Fund does not accurately track the Index, the Fund's portfolio is rebalanced by
selecting securities, using optimization, that will provide a more
representative sampling of the securities in the Index as a whole or sector
diversification within the Index, as appropriate. Each may invest in fixed
income securities (up to 15% of total assets in the case of the SunAmerica
Stock Index Fund), although each does so primarily with respect to short-term
investments to meet liquidity needs. Both Funds are diversified.

Science & Technology Funds

Investment Objectives

The NAF Science & Technology Fund seeks to provide its shareholders with
long-term capital appreciation. The SunAmerica Science & Technology Fund seeks
to provide its shareholders with long-term growth of capital. The two
investment objectives are substantially similar.

Investment Policies

The investment policies of both Science & Technology Funds are substantially
similar.

Strategies. Both Funds, under normal market conditions, invest primarily in
the common stocks of companies expected to benefit from the development,
advancement and use of science and technology. Stock selection for each Fund
reflects a growth approach and each is permitted to invest in companies
regardless of market capitalization. Each Fund is permitted to engage in active
trading. Each Fund may also invest up to 30% of its assets in foreign
securities. Each Fund may invest in fixed-income securities, primarily to meet
liquidity needs or with respect to fixed income securities having similar
growth of capital potential to the equity securities in which it invests. Both
Funds are diversified.

Growth Lifestage Funds

The primary difference between each NAF Growth LifeStyle Fund and the
corresponding SunAmerica Growth LifeStage Fund is the Underlying Funds in which
the particular Fund invests. Each NAF Growth LifeStyle Fund invests in a
combination of North American Funds ("NAF Underlying Funds"), while each
SunAmerica Growth LifeStage Fund invests in a combination of SunAmerica mutual
funds ("SunAmerica Underlying Funds").

Investment Objectives

The NAF Aggressive Growth LifeStyle Fund seeks to provide its shareholders
with growth. The SunAmerica Aggressive Growth LifeStage Fund seeks to provide
its shareholders with growth of capital. The two investment objectives are
substantially similar.

The NAF Moderate Growth LifeStyle Fund seeks to provide its shareholders
with growth and current income. The SunAmerica Moderate Growth LifeStage Fund
seeks to provide its shareholders with growth of capital and current income.
The two investment objectives are substantially similar.

The NAF Conservative Growth LifeStyle Fund seeks to provide its shareholders
with current income and low to moderate growth of capital. The SunAmerica
Conservative Growth LifeStage Fund seeks to provide its shareholders with
current income and growth of capital, with reduced volatility. The two
investment objectives are substantially similar.

Investment Policies

Strategies. Each Growth LifeStage Fund follows a fund of funds investment
strategy based on the allocation of its assets among the Underlying Funds. Each
NAF Growth LifeStyle Fund invests in a combination of NAF Underlying Funds,
while each SunAmerica Growth LifeStage Fund invests in a combination of
SunAmerica Underlying Funds. Although the specific Underlying Funds differ
between a NAF Growth LifeStyle Fund and the corresponding SunAmerica Growth
LifeStage Fund, the allocation among Underlying Funds investing in domestic
equities, international equities and bonds is the same for each pair of Funds
(and is also expected to be the same with respect to the respective Combined
Fund), as follows:

Aggressive Growth Moderate Growth Conservative Growth
LifeStage Funds LifeStage Funds LifeStage Funds
----------------- --------------- -------------------

Domestic Equity
Securities............. 60 - 80% 35 - 65% 20 - 50%
Foreign Equity
Securities............. 15 - 35% 10 - 20% 5 - 15%
Bonds................... 5 - 15% 25 - 45% 45 - 65%

Each Growth LifeStage Fund is non-diversified.

The following table lists all of the Underlying Funds in which the NAF
Growth LifeStyle Funds and SunAmerica Growth LifeStage Funds may invest.
Certain of the NAF Underlying Funds are in the process of reorganizing with
comparable SunAmerica funds, subject to shareholder approval (the "Underlying
Funds Reorganization"). In certain cases, the SunAmerica fund with which the
NAF Underlying Fund is reorganizing will be a comparable SunAmerica Underlying
Fund. In other cases, SAAMCo has determined to substitute different SunAmerica
Underlying Funds in place of NAF Underlying Funds. In the table below, each
SunAmerica Underlying Fund that is party to an Underlying Fund Reorganization
appears opposite the name of the comparable NAF Underlying Fund.

NAF Underlying Funds SunAmerica Underlying Funds
-------------------- ---------------------------

Core Bond Fund................ SunAmerica Core Bond Fund
("NAF Core Bond Fund")
High Yield Bond Fund.......... SunAmerica High Income Fund
("NAF High Yield Bond Fund") (to be renamed SunAmerica High Yield Bond Fund)
International Equity Fund..... SunAmerica International Equity Fund
("NAF International Equity
Fund")
Large Cap Growth Fund......... SunAmerica Blue Chip Growth Fund
("NAF Large Cap Growth Fund")
Growth & Income Fund.......... SunAmerica Growth and Income Fund
("NAF Growth & Income Fund")
Mid Cap Growth Fund........... SunAmerica Growth Opportunities Fund
("NAF Mid Cap Growth Fund")

Small Cap Growth Fund......... N/A
("NAF Small Cap Growth Fund")

Mid Cap Value Fund............ N/A
("NAF Mid Cap Value Fund")

N/A........................... Focused Value Portfolio
("SunAmerica Focused Value Portfolio")

N/A........................... SunAmerica GNMA Fund

N/A........................... SunAmerica New Century Fund

As illustrated by the table above, the NAF Growth LifeStyle Funds have the
option of investing in the NAF Small Cap Growth Fund and the NAF Mid Cap Value
Fund, while the SunAmerica Growth LifeStage Funds have no comparable SunAmerica
Underlying Funds as an investment option. Moreover, the SunAmerica Growth
LifeStage Funds have the option of investing in the SunAmerica Focused Value
Portfolio, SunAmerica GNMA Fund and SunAmerica New Century Fund, while the NAF
LifeStyle Funds have no comparable NAF Underlying Funds as an investment
option. Each of the Underlying Funds is discussed in more detail below.

It is currently anticipated that shareholders of each of the NAF Underlying
Funds will vote on whether to approve its respective Underlying Fund
Reorganization on or about November 7, 2001, with the closing to occur during
the fourth quarter of 2001.

Underlying Fund Comparisons:

NAF Core Bond Fund and SunAmerica Core Bond Fund

The investment objective of NAF Core Bond Fund and SunAmerica Core Bond Fund
is to provide a high level of current income consistent with the maintenance of
principal and liquidity.

Both Funds pursue their respective investment objectives by investing
primarily in a combination of fixed-income securities, including in securities
issued or guaranteed by the U.S. Government, mortgage-backed or asset-backed
securities and U.S. dollar-denominated fixed-income securities issued by
foreign issuers.

The NAF Core Bond Fund may invest up to 35% of its assets in foreign
securities pursuant to a non-fundamental investment restriction. The SunAmerica
Core Bond Fund is not similarly restricted.

NAF High Yield Bond Fund and SunAmerica High Income Fund

The investment objective of the NAF High Yield Bond Fund is to seek the
highest possible total return consistent with conservation of capital.
Shareholders of the SunAmerica High Income Fund are currently being asked to
approve a change in its objective to that of seeking a high level of total
return. These objectives are substantially similar.

Both Funds pursue their respective investment objectives by investing
primarily in high-yield, high-risk corporate bonds (commonly referred to as
junk bonds), generally with relatively low duration. High-yield bonds are those
rated below investment grade -- rated below "Baa" by Moody's Investors Service,
Inc. ("Moody's") or below "BBB" by Standard & Poor's Corporation ("S&P"), or if
unrated, determined to be of equivalent quality by the subadviser.

NAF International Equity Fund and SunAmerica International Equity Fund

The investment objective of the NAF International Equity Fund is long-term
capital appreciation. SunAmerica International Equity Fund's investment
objective is capital appreciation. These objectives are substantially similar.

The NAF International Equity Fund seeks to achieve its objective by
investing primarily, in accordance with country and sector weightings
determined by its subadviser, in equity securities of non-U.S. issuers which,
in the aggregate, closely replicate broad market indices. The NAF International
Equity Fund seeks to maintain a diversified portfolio of international equity
securities based on a top-down approach that emphasizes country and sector
selection and weighting rather than individual stock selection.

The SunAmerica International Equity Fund seeks to achieve its objective by
active trading of equity securities and other securities with equity
characteristics of non-U.S. issuers located in at least three countries

other than the U.S. and selected without regard to market capitalization at the
time of purchase. Active trading is the frequent trading of portfolio
securities to achieve an investment goal. The SunAmerica International Equity
Fund invests in at least three countries outside of the U.S., and may
incorporate, in any combination, elements of "value" investing, "growth"
investing and "country allocation." Country allocation is an investment
strategy where the Fund purchases securities based on research involving
investment opportunities in particular countries or regions, as opposed to
opportunities in particular industries or types of stocks.

NAF Mid Cap Growth Fund and SunAmerica Growth Opportunities Fund

The investment objective of the NAF Mid Cap Growth Fund is long-term capital
appreciation, while the investment objective of the SunAmerica Growth
Opportunities Fund is capital appreciation. These investment objectives are
substantially similar.

Both Funds pursue their respective investment objectives by investing in
common stocks of mid-cap companies that offer the potential for capital
appreciation. The principal difference between these strategies is in the way
that each Fund defines a mid-cap company. The NAF Mid Cap Growth Fund considers
mid-cap companies to be those that have market capitalizations ranging from
approximately $2 billion to $15 billion, whereas the SunAmerica Growth
Opportunities Fund considers mid-cap companies to be those with market
capitalizations within the Style Box categories designed by Morningstar, Inc.
Currently, this range is between approximately $1.4 billion and $9.9 billion.
Both Funds select securities using a growth strategy. Another principal
difference is that a significant portion of the SunAmerica Growth Opportunities
Fund's assets also may be invested in common stock of small-cap and large-cap
companies.

NAF Large Cap Growth Fund and SunAmerica Blue Chip Growth Fund

The NAF Large Cap Growth Fund seeks long-term capital growth and the
SunAmerica Blue Chip Growth Fund seeks capital appreciation. These investment
objectives are substantially similar.

Both Funds pursue their respective investment objectives through a growth
strategy by investing primarily in common stocks of large-cap companies
(approximately $9 billion or more in market capitalization).

NAF Growth & Income Fund and SunAmerica Growth and Income Fund

The NAF Growth & Income Fund seeks long-term growth of capital and income
consistent with prudent investment risk, while the SunAmerica Growth & Income
Fund seeks to provide its shareholders with capital appreciation and current
income. These investment objectives are substantially similar.

Both Funds pursue their respective investment objectives by investing
primarily in dividend-paying common stocks of U.S. issuers.

NAF Small Cap Growth Fund

The NAF Small Cap Growth Fund seeks to provide its shareholders with maximum
capital appreciation.

The NAF Small Cap Growth Fund pursues its investment objective through a
growth strategy. The Fund invests at least 65% of its total assets in equity
securities of small U.S. companies. The NAF Small Cap Growth Fund defines a
small cap company to be one whose market capitalization is within the range of
capitalizations in the Russell 2000 Index. As of June 30, 2001, the largest
company in the Russell 2000 Index had an approximate market capitalization of
$1.4 billion, while the average market capitalization was approximately $530
million.

NAF Mid Cap Value Fund

The NAF Mid Cap Value Fund seeks to provide its shareholders with capital
growth.

The NAF Mid Cap Value Fund pursues its objective through a value strategy.
The NAF Mid Cap Value Fund invests at least 65% of its total assets in equity
securities of medium capitalization companies using a value-oriented investment
approach. The NAF Mid Cap Value Fund defines mid cap companies as companies
with the characteristics of companies included in the Russell Midcap Index. As
of June 30, 2001, the largest company in the Russell Midcap Index had an
approximate market capitalization of $12 billion, while the average market
capitalization was approximately $4 billion.

SunAmerica GNMA Fund

The investment objective of the SunAmerica GNMA Fund is to achieve current
income, with capital appreciation as a secondary objective.

The SunAmerica GNMA Fund pursues its objective by investing primarily in
mortgage-backed securities of high credit quality issued or guaranteed by the
Government National Mortgage Association (GNMA).

SunAmerica Focused Value Portfolio

The investment objective of the SunAmerica Focused Value Portfolio is long-
term growth of capital.

The SunAmerica Focused Value Portfolio pursues its objective through active
trading of equity securities selected on the basis of value criteria, without
regard to market capitalization.

SunAmerica New Century Fund

The investment objective of the SunAmerica New Century Fund is capital
appreciation.

The Fund pursues its investment objective through active trading of common
stocks that demonstrate the potential for capital appreciation, without regard
to market capitalization. The Fund will invest in companies believed to offer
rapid growth opportunities and trends in "New Economy" sectors. These dynamic
economic sectors rapidly develop and evolve through, or as a result of,
technological advancement and innovation. The Fund may also invest in companies
the manager believes will experience strong growth in traditional economic
sectors, such as retail services, apparel, leisure, banking, household
products, and food. The relative size of the Fund's investments in "New
Economy" sectors and traditional sectors will vary from time to time, and at
times an above-named industry may not be represented in the Fund's holdings.

All Funds

Principal Risk Factors

For a discussion of the principal risks of investing in each Fund and
Underlying Fund, see "Principal Risk Factors and Special Considerations."

Trustees/Directors and Officers

Each of North American Funds and SunAmerica Strategic Investment Series,
Inc. is governed by a Board of Trustees/Directors that meets regularly to
review its respective Funds' investments, performance, expenses, and other
business affairs. Each Board of Trustees/Directors elects its respective Funds'
officers.

Management Arrangements

Comparison of Management and Administrative Arrangements and Fees. AGAM
serves as the investment adviser for the Acquired Funds and SAAMCo serves as
the investment adviser for the Acquiring Funds. Each of AGAM and SAAMCo is
responsible for the management of the investment portfolio (or, as the case may
be, selection of the subadviser responsible for the direct management of such
investment portfolio) of each Acquired Fund and Acquiring Fund, respectively,
and for providing certain administrative services to such Fund. See "Proposals
Nos. 2(a)-(e): Approval of the Plans" for more detailed information regarding
the advisory arrangements of the Funds.

The table below sets forth the fees, as a percentage of average daily net
assets, payable by each Acquired Fund to AGAM and by each Acquiring Fund to
SAAMCo, for the management and administrative services provided by AGAM and
SAAMCo, respectively, to each of the applicable Funds. The Acquired Funds and
Acquiring Funds have the same fee schedules.

As compensation for its management and administrative services to each of
the Combined Funds, SAAMCo will receive a fee at the same annual rates set
forth for the respective Acquired Funds.

Advisory Fee:
-----------------------
First $500 Excess over
Fund: Million $500 Million
----- ---------- ------------

NAF Stock Index Fund.................................... 0.27% 0.26%
SunAmerica Stock Index Fund............................. 0.27% 0.26%

NAF Science & Technology Fund........................... 0.90% 0.90%
SunAmerica Science & Technology Fund.................... 0.90% 0.90%

NAF Aggressive Growth LifeStyle Fund.................... 0.10% 0.10%
SunAmerica Aggressive Growth LifeStage Fund............. 0.10% 0.10%

NAF Moderate Growth LifeStyle Fund...................... 0.10% 0.10%
SunAmerica Moderate Growth LifeStage Fund............... 0.10% 0.10%

NAF Conservative Growth LifeStyle Fund.................. 0.10% 0.10%
SunAmerica Conservative Growth LifeStage Fund........... 0.10% 0.10%

Investment Advisory Agreements. The investment advisory agreement between
SunAmerica Strategic Investment Series, Inc. on behalf of the Acquiring Funds
and SAAMCo (the "SunAmerica Investment Advisory Agreement") is similar to both
the New and Previous Investment Advisory Agreements applicable to the Acquired
Funds (collectively, the "NAF Investment Advisory Agreement"), except for
certain matters including the effective dates and the identity of the adviser.
See "Proposals Nos. 2(a)-(e): Approval of the Plans" for further discussion
regarding these agreements.

Subadvisory Arrangements. Under a "Manager of Managers" order granted to the
North American Funds by the Commission, AGAM is permitted to change
unaffiliated subadvisers or the fees paid to subadvisers without obtaining
shareholder approval. AGAM has ultimate responsibility under the "Manager of
Managers" structure to oversee the subadvisers, including making
recommendations to the NAF Board regarding the hiring, termination and
replacement of such subadvisers. However, the "Manager of Managers" order does
not apply if the subadviser is an affiliate of AGAM. Since AGAM is affiliated
with the subadviser of each Acquired Fund other than the NAF Science &
Technology Fund, AGAM may not change the subadviser of any Acquired Fund other
than the NAF Science & Technology Fund without obtaining the approval of the
shareholders of that Fund. All subadvisory fees are paid out of AGAM's advisory
fee at no additional cost to the Acquired Funds or their shareholders. SAAMCo
is also authorized to appoint and change

unaffiliated subadvisers for SunAmerica Strategic Investment Series, Inc. under
a separate "Manager of Managers" order granted by the Commission. As of the
date hereof, SAAMCo has appointed New AGIM as subadviser to the SunAmerica
Stock Index Fund and T. Rowe Price as subadviser to the SunAmerica Science &
Technology Fund, each pursuant to a subadvisory agreement with SAAMCo (each a
"SunAmerica Subadvisory Agreement" and collectively the "SunAmerica Subadvisory
Agreements") that is similar to both the New and Previous Subadvisory
Agreements applicable to the respective Acquired Funds, except for certain
matters including the effective dates and the identity of the investment
adviser. The appointment of New AGIM is not pursuant to SAAMCo's "Manager of
Managers" order and is subject to shareholder approval. See "Proposal No. 1(b):
Approval of the New Subadvisory Agreement." SAAMCo will directly manage the
investment portfolio of each SunAmerica Growth LifeStage Fund. If shareholders
approve the Reorganizations, the portfolios of the Acquired Funds will be
managed by SAAMCo, or the respective subadviser, as part of the Combined Funds
following completion of the Reorganizations. See "Proposals Nos. 2(a)-(e):
Approval of the Plans--Comparison of the Funds" for additional information
regarding the Funds' subadvisory arrangements.

Distribution and Shareholder Servicing Arrangements

Distributor. American General Funds Distributors, Inc. ("AGFD" or the "NAF
Distributor"), an affiliate of AGAM, acts as the distributor of the shares of
the Acquired Funds. SunAmerica Capital Services, Inc. ("SACS" or the
"SunAmerica Distributor"), an affiliate of SAAMCo, acts as the distributor of
the shares of the Acquiring Funds. See "Proposals Nos. 2(a)-(e): Approval of
the Plans" for additional information regarding the Funds' distribution
arrangements.

Shareholder Servicing Fees for Class I. AGAM provides certain recordkeeping
and shareholder services to retirement and employee benefit plans and the NAF
Growth LifeStyle Funds, each of which invest in Institutional Class I shares of
certain of the Acquired Funds. SACS will provide these services after the
Reorganizations with respect to Class I shares of the applicable Combined
Funds. See "Proposals Nos. 2(a)-(e): Approval of the Plans" for additional
information regarding these services.

Other Service Agreements with Affiliates

SunAmerica Fund Services, Inc. ("SAFS"), an affiliate of SAAMCo, acts as a
servicing agent assisting State Street Bank and Trust Company ("State Street"),
the transfer agent and custodian of the Acquiring Funds, in connection with
certain services offered to the shareholders of the Acquiring Funds. See
"Proposals Nos. 2(a)-(e): Approval of the Plans" for additional information
regarding these service agreements.

Other

Shares. As with all mutual funds, investors purchase shares when they invest
in the Funds. Share certificates are not generally issued.

Each full share and fractional share entitles the shareholder to receive a
proportional interest in the respective Fund's capital gain distributions and
to cast one vote per share, with fractional shares voting proportionately, on
certain Fund matters, including the election of Trustees/Directors, changes in
fundamental policies, or approval of changes in investment advisory agreements.

Class Structure.

The table below sets forth the share classes offered by each of the Acquired
Funds, Acquiring Funds and, after consummation of the respective
Reorganizations, the Combined Funds.

Acquiring Combined
Acquired Funds Funds Funds
-------------- --------- --------

A A A
B B B
C II II
Institutional I I I

Purchase of Shares. The procedures for purchasing shares are similar, but
not identical, for all Funds. See "Proposals Nos. 2(a)-(e): Approval of the
Plans" below, "Investing in the North American Funds" in the Acquired Funds
Prospectuses and "Shareholder Account Information" in the Acquiring Funds
Prospectus.

Redemption of Shares. The procedures for redeeming shares are similar, but
not identical, for all Funds. See "Proposals Nos. 2(a)-(e): Approval of the
Plans" below, "Investing in the North American Funds" in the Acquired Funds
Prospectuses and "Shareholder Account Information" in the Acquiring Funds
Prospectus.

Exchanges of Shares. The procedures for exchanging shares are similar, but
not identical, for all Funds. See "Proposals Nos. 2(a)-(e): Approval of the
Plans" below, "Account Services" and "Section III: Investing in the North
American Funds Institutional Classes of Shares" in the Acquired Funds
Prospectuses and "Transaction Policies" in the Acquiring Funds Prospectus.

Dividends. The Funds currently have the same or similar policies with
respect to dividends. See "Proposals Nos. 2(a)-(e): Approval of the Plans"
below, "Pricing of Shares" and "Dividends and Distributions from North American
Funds" in the Acquired Funds Prospectuses and "Tax, Dividend, Distribution and
Account Policies" in the Acquiring Funds Prospectus.

Net Asset Value. The price at which each Fund's shares are purchased or
redeemed is the Fund's next determined net asset value per share after receipt
of the purchase or redemption order. The net asset value per share is
calculated once daily as of the close of regular trading on the New York Stock
Exchange ("NYSE") (currently 4:00 p.m., Eastern Time). For further discussion
on net asset value and how it is determined, see "Proposals Nos. 2(a)-(e):
Approval of the Plans" below, "Pricing of Fund Shares" in the Acquired Funds
Prospectuses and "Transaction Policies" in the Acquiring Funds Prospectus.

Tax Considerations. The tax consequences associated with an investment in
shares of an Acquired Fund are substantially the same as the tax consequences
associated with an investment in shares of the respective Acquiring Fund. See
"Taxes" in the Acquired Funds Prospectuses and "Tax, Dividend, Distribution and
Account Policies" in the Acquiring Funds Prospectus.

Each Reorganization has been structured with the intention that it qualify
for Federal income tax purposes as a tax-free reorganization under the Code.
This means that, in the opinion of counsel, no gain or loss will be recognized
by a shareholder of an Acquired Fund for Federal income tax purposes as a
result of a Reorganization. For a more detailed discussion regarding potential
tax consequences of the Reorganizations, see "Proposals Nos. 2(a)-(e): Approval
of the Plans."

PRINCIPAL RISK FACTORS AND SPECIAL CONSIDERATIONS

PRINCIPAL RISKS OF INVESTING IN THE ACQUIRED FUNDS, ACQUIRING FUNDS AND
UNDERLYING FUNDS

Many of the investment risks associated with an investment in an Acquired
Fund are substantially the same as those associated with an investment in the
respective Acquiring Fund. With respect to the Growth LifeStage Funds, many of
the investment risks associated with the NAF Underlying Funds in which the NAF
Growth LifeStyle Funds invest are substantially the same those associated with
an investment in the respective SunAmerica Underlying Fund in which a Sun
America Growth LifeStage Fund invests. A discussion of the principal risks of
investing in the Funds and Underlying Funds is set forth below. See the
Acquired Funds Prospectuses, and the Acquired Funds Statement for more detailed
discussions of investment risks associated with an investment in the Acquired
Funds. There is no guarantee that the investment objective of a Fund or
Underlying Fund will be achieved or that the value of a shareholder's
investment in a Fund or Underlying Fund will not decrease.

The principal risks of each Acquired Fund and the corresponding Acquiring
Fund are substantially similar in most respects. The main differences are
summarized below.

The main difference in investment risk of the Growth LifeStage Funds is
related to the Underlying Funds in which each Fund invests. The primary
differences in investment risks related to these Underlying Funds are: (1) the
SunAmerica International Equity Fund is subject to non-diversification risk
whereas the NAF International Equity Fund is not and (2) the SunAmerica Growth
Opportunities Fund may be more subject to the risks associated with investments
in common stocks issued by technology companies than the NAF Mid Cap Growth
Fund. The principal risks of the NAF Core Bond Fund and the SunAmerica Core
Bond Fund, the NAF High Yield Bond Fund and the SunAmerica High Income Fund,
the NAF Large Cap Growth Fund and the SunAmerica Blue Chip Growth Fund, the NAF
Growth & Income Fund and the SunAmerica Growth & Income Fund, are substantially
similar, respectively. Moreover, by virtue of their possible investment in the
NAF Small Cap Growth Fund and the NAF Mid Cap Value Fund, the NAF Growth
LifeStyle Funds may be subject to greater stock market volatility/equity risk,
foreign exposure risk, small cap risk and technology company risk, than the
SunAmerica Growth LifeStage Funds. By virtue of their possible investment in
the SunAmerica Focused Value Portfolio and the SunAmerica GNMA Fund, the
SunAmerica Growth LifeStage Funds may be subject to greater non-diversification
risk, bond market volatility/interest rate risk and prepayment risk, than the
NAF Growth Lifestyle Funds. Each of the risks related to investing in an
Underlying Fund becomes more significant as a Fund's allocation to such
Underlying Fund increases.

All Acquired Funds, Acquiring Funds and Underlying Funds

Stock Market Volatility/Equity Risk

All Funds (or, in the case of the Growth LifeStage Funds, certain of the
Underlying Funds in which they invest) invest significantly in equity
securities. As with any equity fund, the value of your investment in a Fund may
fluctuate in response to stock market movements. In addition, individual stocks
selected for any of the Funds may underperform the market generally.

The Underlying Funds that are subject to this risk are the NAF International
Equity Fund, the SunAmerica International Equity Fund, the NAF Large Cap Growth
Fund, the SunAmerica Blue Chip Growth Fund, the NAF Growth & Income Fund, the
SunAmerica Growth and Income Fund, the NAF Mid Cap Growth Fund, the SunAmerica
Growth Opportunities Fund, the SunAmerica Focused Value Portfolio, the NAF Mid
Cap Value Fund, the NAF Small Cap Growth Fund and the SunAmerica New Century
Fund. For the NAF Large Cap Growth Fund, this risk includes, in particular, the
risks associated with growth stocks and investing in IPOs. For the NAF Growth &
Income Fund and the SunAmerica Growth and Income Fund, this risk includes, in
particular, the risks associated with value stocks and the risk that the stocks
these Funds buy may stop paying dividends.

Securities Selection

All Funds (or, in the case of the Growth LifeStage Funds, the Underlying
Funds in which they invest) are subject to securities selection risk.
Securities selection risk is when a strategy used by a Fund, or securities
selected by its portfolio manager, may fail to produce the intended return.

All Underlying Funds are subject to this risk.

Stock Index Funds

Index Tracking Variations

Index funds generally try to mirror a target index and its performance. An
index fund's performance will not exactly match that of an index because the
index fund incurs operating expenses and investment overhead as part of its
normal operations. An index is an unmanaged group of securities, so it does not
have these expenses. The factors that cause an index fund to perform
differently from the index it tries to track are called tracking differences.
There is no assurance that an index fund can track its index.

Science & Technology Funds

Technology Company Risk

Each Science & Technology Fund is subject to the risk associated with
investing in science and technology companies. Technology companies may react
similarly to certain market pressures and events. They may be significantly
affected by short product cycles, aggressive pricing of products and services,
competition from new market entrants, worldwide scientific and technological
developments and changes in governmental regulations and policies and
obsolescence of existing technology. As a result, these Funds' returns may be
considerably more volatile than a fund that does not invest in science and
technology companies.

Small Cap Risk

Each Science & Technology Fund is subject to the risk associated with
investing in small capitalization issuers. Companies with smaller market
capitalizations (particularly under $1 billion) tend to be at early stages of
development with limited product lines, market access for products, financial
resources, access to new capital, or depth in management. It may be difficult
to obtain reliable information and financial data about such companies.
Consequently, securities of smaller companies may not be as readily marketable
and may be subject to more abrupt or erratic market movements.

Growth LifeStage Funds and Underlying Funds

Non-Diversification Risk

Each Growth LifeStage Fund is non-diversified, which means it can invest a
larger portion of its assets in the stock of a single company (i.e., one of the
Underlying Funds) than can some other mutual funds. By concentrating in a
smaller number of holdings, a Fund's risk is increased because the effect of
each holding on the Fund's performance is greater.

The Underlying Funds subject to this principal risk are the SunAmerica
International Equity Fund, the SunAmerica Focused Value Portfolio and the NAF
Small Cap Growth Fund.

Foreign Exposure

Each Growth LifeStage Fund is subject to the risks associated with the
Underlying Funds' foreign investments. One such risk is that fluctuations in
the exchange rates between the U.S. dollar and foreign

currencies may negatively affect an investment. In addition, there may be less
publicly available information about a foreign company and it may not be
subject to the same uniform accounting, auditing and financial reporting
standards as U.S. companies. Foreign governments may not regulate securities
markets and companies to the same degree as the U.S. government. Foreign
investments will also be affected by local, political or economic developments
and governmental actions. Consequently, foreign securities may be less liquid,
more volatile and more difficult to price than U.S. securities. These risks are
heightened when the issuer is in an emerging market.

The Underlying Funds subject to this principal risk are the NAF
International Equity Fund, the SunAmerica International Equity Fund, the NAF
Mid Cap Value Fund and the NAF Small Cap Growth Fund.

Bond Market Volatility/Interest Rate Risk

Each Growth LifeStage Fund is subject to the risk that bond markets as a
whole could go up or down (sometimes dramatically). Moreover, each Growth
LifeStage Fund is subject to interest rate risk due to the Underlying Funds'
investments. As with any bond fund, the value of your investment in each Growth
LifeStage Fund may go up or down in response to changes in interest rates. As
interest rates rise, bond prices typically fall. Movements in the bond market
generally may affect each Fund's performance. This type of risk is expected to
become more significant as a Fund's allocation to Underlying Funds investing in
bonds and other fixed-income securities increases ("Underlying Income Funds").

The Underlying Funds subject to this principal risk are the NAF Core Bond
Fund, the SunAmerica Core Bond Fund, the NAF High Yield Bond Fund, the
SunAmerica High Income Fund, and the SunAmerica GNMA Fund.

Credit Risk

Each Growth LifeStage Fund is subject to credit risk, which is the risk that
the companies in which the Underlying Funds invest or with which they do
business, will fail financially or otherwise fail to honor their obligations.
This type of risk is expected to become more significant as a Fund's allocation
to Underlying Income Funds increases.

The Underlying Funds subject to this principal risk are the NAF Core Bond
Fund, the SunAmerica Core Bond Fund, the NAF High Yield Bond Fund, and the
SunAmerica High Income Fund. This risk is heightened for the NAF High Yield
Bond Fund and the SunAmerica High Income Fund which invest primarily in lower
quality bonds.

Prepayment Risk

The Conservative Growth LifeStage Funds and Moderate Growth LifeStage Funds
invest in Underlying Income Funds that invest significantly in mortgage-backed
securities. This entails the risk that the underlying principal may be
"prepaid" at any time. As a result of prepayments, in periods of declining
interest rates the Underlying Income Funds may be required to reinvest their
assets in securities with lower interest rates. In periods of increasing
interest rates, prepayments generally may decline, with the effect that the
securities subject to prepayment risk held by the Underlying Income Funds may
exhibit price characteristics of longer-term debt securities.

The Underlying Funds subject to this principal risk are the NAF Core Bond
Fund, the SunAmerica Core Bond Fund and the SunAmerica GNMA Fund.

Small Cap Risk

The Aggressive Growth LifeStage Funds also invest in stocks of small
capitalization issuers. Companies with smaller market capitalizations
(particularly under $1 billion) tend to be at early stages of development

with limited product lines, market access for products, financial resources,
access to new capital, or depth in management. It may be difficult to obtain
reliable information and financial data about such companies. Consequently,
securities of smaller companies may not be as readily marketable and may be
subject to more abrupt or erratic market movements.

The Underlying Funds subject to this principal risk are the NAF Mid Cap
Growth Fund, the SunAmerica Growth Opportunities Fund, the NAF Mid Cap Value
Fund, the NAF Small Cap Growth Fund, and the SunAmerica New Century Fund.

Technology Company Risk

The Aggressive Growth LifeStage Funds may at times invest in Underlying
Funds that significantly invest in technology companies. Technology companies
may react similarly to certain market pressures and events. They may be
significantly affected by short product cycles, aggressive pricing of products
and services, competition from new market entrants, worldwide scientific and
technological developments and changes in governmental regulations and policies
and obsolescence of existing technology. As a result, these Underlying Funds'
returns may be considerably more volatile than a fund that does not invest in
technology companies.

The Underlying Funds subject to this principal risk are the NAF Mid Cap
Growth Fund, the SunAmerica Growth Opportunities Fund, the SunAmerica Focused
Value Portfolio, the NAF Mid Cap Value Fund, the NAF Small Cap Growth Fund and
the SunAmerica New Century Fund. Although the NAF Mid Cap Growth Fund and the
SunAmerica Growth Opportunities Fund are subject to the risks associated with
investments in common stocks issued by technology companies, this risk may be
relatively greater for the SunAmerica Growth Opportunities Fund because such
investments may at times constitute a significant portion of the SunAmerica
Growth Opportunities Fund's portfolio.

PROPOSAL NOS. 1(a) AND (b): APPROVAL OF THE NEW INVESTMENT
ADVISORY AGREEMENT AND NEW SUBADVISORY AGREEMENT

THE AIG MERGER AND THE NEW INVESTMENT ADVISORY AGREEMENT AND
NEW SUBADVISORY AGREEMENT

Board Considerations

On August 29, 2001, AIG acquired American General in the AIG Merger. As a
result of the AIG Merger, AGAM and AGIM became subsidiaries of AIG.

As required by the Investment Company Act, the Previous Investment Advisory
Agreement and Previous Subadvisory Agreement provided for automatic termination
upon "assignment." Under the Investment Company Act, a change of control of an
investment adviser (or subadviser) constitutes an "assignment." The
consummation of the AIG Merger resulted in the assignment of the Previous
Agreements and their automatic termination. Therefore, as described below,
shareholders are being asked to approve the New Agreements.

At a meeting held on July 16-17, 2001, the NAF Board, including all of the
NAF Independent Trustees, unanimously approved an interim investment advisory
agreement (the "Interim Investment Advisory Agreement") between AGAM and North
American Funds with respect to the Acquired Funds and an interim subadvisory
agreement (the "Interim Subadvisory Agreement," and together with the Interim
Investment Advisory Agreement, the "Interim Agreements"), between AGAM and New
AGIM, an affiliate of AGAM, with respect to the Acquired Funds pursuant to Rule
15a-4 under the Investment Company Act. This has allowed them to continue to
serve the Acquired Funds (other than the NAF Science & Technology Fund, with
respect to New AGIM) after the AIG Merger. This Rule, under certain
circumstances, allows interim advisory agreements to take effect, and to remain
in effect for up to 150 days, without receiving prior shareholder approval, as
long as the fees payable under such agreement do not exceed the fees payable
under the predecessor agreement that had been approved by the shareholders and
certain other contractual provisions are included in the interim agreement. The
Interim Agreements require all advisory fees earned by AGAM and New AGIM to be
escrowed pending shareholder approval of the New Agreements. If the New
Agreements are not approved, AGAM and New AGIM will be entitled to receive from
escrow the lesser of any costs incurred in performing the Interim Agreements
(plus interest earned on the amount while in escrow), and the total amount in
the escrow account (plus interest earned). The Interim Agreements will
terminate on the earlier of the effective date of the New Agreements or 150
days after the completion of the AIG Merger.

Pursuant to the terms of the Interim Investment Advisory Agreement, AGAM is
responsible for the management of the investment portfolio of each Acquired
Fund (and, in connection therewith, selection of the subadviser responsible for
the direct management of such investment portfolio) and for providing certain
administrative services to each Acquired Fund. Pursuant to the terms of the
Interim Subadvisory Agreement, New AGIM is responsible for managing the
investment and reinvestment of the assets of each Acquired Fund (other than the
NAF Science & Technology Fund), subject to the supervision of the NAF Board.
The terms of the Interim Investment Advisory Agreement and Interim Subadvisory
Agreement are similar in all material respects as those of the respective
Previous Agreement. Under the Investment Company Act, however, AGAM and New
AGIM may continue to serve as the investment adviser and subadviser,
respectively, for each Acquired Fund (other than, in the case of New AGIM, the
NAF Science & Technology Fund) beyond an interim period of 150 days only if
shareholders of such Acquired Fund approve a new investment advisory agreement
with AGAM and new subadvisory agreement with New AGIM. Consequently, the NAF
Board unanimously approved and recommended shareholder approval of the New
Agreements on July 16-17, 2001. The New Agreements, if approved by
shareholders, would take effect immediately upon such approval. The terms of
each New Agreement, including advisory fees, are the same in all material
respects as those of the respective Previous Agreement.

In addition, the NAF Board also approved the continuation of the subadvisory
agreement with T. Rowe Price for the NAF Science & Technology Fund, which
terminated upon termination of the Previous Investment Advisory Agreement. Such
approval was made in accordance with a "Manager of Managers" order granted by
the Commission to North American Funds and therefore the subadvisory agreement
for the NAF Science & Technology Fund does not require shareholder approval.

In connection with its approval of the New Agreements, the NAF Board
received a presentation relating to AIG and SAAMCo, as well as a presentation
from AGAM. The NAF Board considered that the AIG Merger did not involve any
changes in the overall form of the advisory or subadvisory contract, the
advisory fees, or any of the Acquired Funds' objectives or policies. The NAF
Board also considered that AGAM and SAAMCo had indicated that while they
intended to propose the Reorganizations to the NAF Board at a subsequent
meeting, until such Reorganizations were approved and consummated, SAAMCo and
AIG represented there would be no material change in the nature and quality of
services provided by AGAM. As part of their deliberations, the NAF Board took
into account the following, among other factors: the nature and quality of the
services provided or reasonably anticipated to be provided and the results
achieved or reasonably anticipated to be achieved by AGAM and/or New AGIM; the
amount and structure of investment advisers' fees generally and the fees
payable under the New Agreements; the financial strength of AIG; the
management, personnel and operations of AIG and SAAMCo; the commitment of AIG
to the financial services industry; and the structure of the AIG Merger.

In addition, the NAF Board considered the fact that at some point after
consummation of the Merger, the operations of AGIM might be consolidated with
those of another affiliate within the AIG group of companies to eliminate
duplication and attempt to create economies of scale within the organization.
The NAF Board was assured that any such internal reorganization would not
result in a change in the personnel responsible for providing services to the
applicable Acquired Funds or in the nature or quality of those services.
Accordingly, the NAF Board approved each of the Interim Subadvisory Agreement
and the New Subadvisory Agreement with New AGIM.

Section 15(f) of the Investment Company Act provides that an investment
adviser (such as AGAM or New AGIM) to a registered investment company, and the
affiliates of such adviser, may receive any amount or benefit in connection
with a sale of any interest in such investment adviser which results in an
assignment of an investment advisory contract if the following two conditions
are satisfied: (1) for a period of three years after such assignment, at least
75% of the board of directors of the investment company are not "interested
persons" (within the meaning of Section 2(a)(19) of the Investment Company Act)
of the new investment adviser or its predecessor; and (2) no "unfair burden"
(as defined in the Investment Company Act) may be imposed on the investment
company as a result of the assignment or any express or implied terms,
conditions or understandings applicable thereto. Consistent with the first
condition of Section 15(f), AIG advised the NAF Board that for a period of
three years after the AIG Merger, it will not take or recommend any action that
would cause more than 25% of the NAF Board (or SunAmerica Board) to be
interested persons of SAAMCo, AGAM or New AGIM. With respect to the second
condition of Section 15(f), an "unfair burden" on an investment company is
defined in the Investment Company Act to include any arrangement during the
two-year period after any such transaction occurs whereby the investment
adviser or its predecessor or successor, or any interested person of such
adviser, predecessor or successor, receives or is entitled to receive any
compensation of two types, either directly or indirectly. The first type is
compensation from any person in connection with the purchase or sale of
securities or other property to, from or on behalf of the investment company,
other than bona fide ordinary compensation as principal underwriter for such
company. The second type is compensation from the investment company or its
security holders for other than bona fide investment advisory or other
services. AIG advised the NAF Board that it will not take or recommend any
action that would constitute an unfair burden on North American Funds (or the
Acquiring Funds) within the meaning of Section 15(f).

PROPOSAL NO. 1(a): APPROVAL OF THE NEW INVESTMENT ADVISORY AGREEMENT

THE NEW INVESTMENT ADVISORY AGREEMENT

Description of the New Investment Advisory Agreement

As a proposal separate from the proposal to approve a Reorganization,
shareholders of each Acquired Fund are being asked to approve the New
Investment Advisory Agreement with AGAM to cover the period subsequent to the
shareholder approval and prior to consummation of the Reorganization (which is
currently anticipated to occur during the fourth calendar quarter of 2001). If
this proposal is approved, but a Reorganization is not approved, by the
shareholders of an Acquired Fund, AGAM will continue to serve as that Acquired
Fund's adviser under the New Investment Advisory Agreement. The terms of the
New Investment Advisory Agreement are the same in all material respects as
those of the Previous Investment Advisory Agreement. The New Investment
Advisory Agreement differs from the Previous Investment Advisory Agreement only
with respect to the effective date. The Previous Investment Advisory Agreement
is dated June 1, 2000 and was last approved by the shareholders of the Acquired
Funds at a meeting held on the same date in connection with its initial
approval. A description of the New Investment Advisory Agreement and the
services to be provided by AGAM is set forth below. This description is
qualified in its entirety by reference to the form of the New Investment
Advisory Agreement attached to this Proxy Statement and Prospectus as Exhibit
IA.

As compensation for its services under the New Investment Advisory
Agreement, the Acquired Funds will pay to AGAM the same fee, as a percentage of
average daily net assets, that was payable to AGAM under the Previous
Investment Advisory Agreement. Such fee will be payable monthly and accrued
daily. See "Summary--The Funds" for a description of the fee payable to AGAM
under the Previous Investment Advisory Agreement. AGAM has agreed, until
February 28, 2002, to reduce fees payable to it by, or reimburse expenses to,
the Acquired Funds. See "Summary--Fee Tables" or "Proposals Nos. 2(a)-(e):
Approval of the Plans."

For the fiscal year ended October 31, 2000, North American Funds paid total
advisory fees to AGAM of $7,339,733. Of such amount, $27,616, $53,172, $6,966,
$6,368 and $5,736 (in each case for the period July 7, 2000 to October 31,
2000) were attributable to the NAF Stock Index Fund, the NAF Science &
Technology Fund, the NAF Aggressive Growth LifeStyle Fund, the NAF Moderate
Growth LifeStyle Fund and the NAF Conservative Growth LifeStyle Fund,
respectively. From November 1, 1999 to July 7, 2000, The Variable Annuity Life
Insurance Company ("VALIC"), an affiliate of AGAM, served as investment adviser
to each of the Acquired Funds. During this period, North American Funds paid
total advisory fees to VALIC of $540,574. Of such amount, $48,901, $31,018,
$10,087, $9,978 and $9,390 were attributable to the NAF Stock Index Fund, NAF
Science & Technology Fund (for the period March 1, 2000 to July 7, 2000), NAF
Aggressive Growth LifeStyle Fund, NAF Moderate Growth LifeStyle Fund and NAF
Conservative Growth LifeStyle Fund, respectively. These amounts do not reflect
certain fee waivers and expense reimbursements for which the Acquired Funds
were reimbursed.

The Board of Trustees of North American Funds unanimously recommends that
the shareholders of each Acquired Fund approve the New Investment Advisory
Agreement. Shareholders of each Acquired Fund vote separately on the approval
of the New Investment Advisory Agreement. Approval of the New Investment
Advisory Agreement by one Acquired Fund is not contingent upon approval of the
New Investment Advisory Agreement by any other Acquired Fund. If the New
Investment Advisory Agreement is not approved by shareholders of an Acquired
Fund, the NAF Board will determine the appropriate actions in the best
interests of the shareholders to be taken with respect to such Acquired Fund's
advisory arrangements at that time.

Additional Information About AGAM

General

CypressTree Investments, Inc. ("CypressTree") and its affiliates were formed
in 1996 to acquire, advise and distribute mutual funds through broker-dealers
and other intermediaries. CypressTree Asset Management

Corporation, Inc. ("CAM") was CypressTree's wholly owned advisory subsidiary
and CypressTree Funds Distributors, Inc. ("CFD") was CypressTree's wholly owned
distribution subsidiary. On March 10, 2000, CypressTree sold substantially all
of its assets, including all of the stock of CAM and CFD, to American General.
Thereafter, CAM was renamed American General Asset Management Corp. and CFD was
renamed American General Funds Distributors, Inc. Pursuant to the Previous
Advisory Agreement, AGAM oversaw the administration of all aspects of the
business and affairs of the Acquired Funds, and selected, contracted with and
compensated subadvisers to manage the assets of the Acquired Funds. AGAM has
continued to perform these functions under the Interim Investment Advisory
Agreement since the completion of the AIG Merger.

AGAM is located at 286 Congress Street, Boston, Massachusetts 02210. Prior
to the AIG Merger, AGAM was wholly owned by American General, which is located
at 2929 Allen Parkway, Houston, Texas 77019. As a result of the AIG Merger,
American General is wholly owned by AIG. The principal address of AIG is 70
Pine Street, New York, New York 10270.

The directors and principal executive officer of AGAM, if any, their
business addresses, position(s) with AGAM and a description of their principal
occupations are set forth below.

Name and Address Position with AGAM and Principal Occupation(s)
---------------- ----------------------------------------------

John A. Graf....... Director; Senior Vice Chairman, Asset Accumulation,
2929 Allen Parkway American General.
Houston, TX 77019

Kent E. Barrett.... Director and Treasurer; Senior Vice President and General
2929 Allen Parkway Auditor, American General.
Houston, TX 77019

In addition, the following officers of North American Funds also are
employees of AGAM:

Thomas J. Brown, Treasurer and Vice President of North American Funds and
Chief Financial Officer and Chief Administrative Officer of AGAM.

John I. Fitzgerald, Secretary and Vice President of North American Funds and
Assistant Secretary and Counsel of AGAM.

John N. Packs, Vice President of North American Funds and Director of
Research of AGAM.

Additional Payments to AGAM and its affiliates by Acquired Funds

The Previous Investment Advisory Agreement provided for reimbursement to
AGAM for various expenses related to financial, accounting and administrative
services provided to the Acquired Funds. For the fiscal year ended October 31,
2000, North American Funds paid in the aggregate $1,387,842 to AGAM for such
services. Of such amount, $10,338, $5,184, $0, $0 and $0 (in each case for the
period July 7, 2000 to October 31, 2000) were attributable to the NAF Stock
Index Fund, the NAF Science & Technology Fund, the NAF Aggressive Growth
LifeStyle Fund, the NAF Moderate Growth LifeStyle Fund and the NAF Conservative
Growth LifeStyle Fund, respectively. From November 1, 1999 to July 7, 2000,
VALIC, an affiliate of AGAM, served as investment adviser to each of the
Acquired Funds, but was not similarly reimbursed.

For the fiscal year ended October 31, 2000, AGAM was paid fees on
Institutional Class I shares of each Acquired Fund under the NAF Services
Agreement (as defined below) of $381 by the NAF Science & Technology Fund and
$0 by each of the NAF Stock Index Fund, the NAF Aggressive Growth LifeStyle
Fund, the NAF Moderate Growth LifeStyle Fund and the NAF Conservative Growth
LifeStyle Fund (in each case for the period July 7, 2000 to October 31, 2000),
respectively. From November 1, 1999 to July 7, 2000, VALIC Retirement Services
Company ("VRSCO") and/or VALIC Investment Services Company ("VISCO"),
affiliates of VALIC, were paid fees under a comparable agreement of $528 by the
NAF Science & Technology

Fund (for the period March 1, 2000 to July 7, 2000) and $0 by each of the NAF
Stock Index Fund, NAF Aggressive Growth LifeStyle Fund, NAF Moderate Growth
LifeStyle Fund and NAF Conservative Growth LifeStyle Fund, respectively. In
addition, from November 1, 1999 to July 7, 2000, VALIC was paid fees under a
separate agreement to provide accounting services to each of the Acquired
Funds. For this period, under such agreement, VALIC was paid fees of $5,433,
$1,033, $0, $0 and $0 attributable to the NAF Stock Index Fund, NAF Science &
Technology Fund (for the period March 1, 2000 to July 7, 2000), NAF Aggressive
Growth LifeStyle Fund, NAF Moderate Growth Lifestyle Fund and NAF Conservative
Growth LifeStyle Fund, respectively.

For the fiscal year ended October 31, 2000, the Acquired Funds paid the NAF
Distributor the following distribution and service fees (in each case for the
period July 7, 2000 to October 31, 2000):

Distribution and
Service Fees
---------------------
Class Class
A Class B C
------ ------- ------

NAF Stock Index Fund.................................. $8,638 $74,799 $ 549
NAF Science & Technology Fund......................... $4,218 $43,890 $1,345
NAF Aggressive Growth LifeStyle Fund.................. $1,213 $29,870 $ 175
NAF Moderate Growth LifeStyle Fund.................... $ 479 $26,882 $ 107
NAF Conservative Growth LifeStyle Fund................ $ 454 $24,671 $ 79

For the period November 1, 1999 to July 7, 2000, the NAF Stock Index Fund
paid American General Distributors, Inc., a separate affiliated distributor,
distribution and service fees in connection with its Class A and Class B shares
of $11,985 and $135,685, respectively. For the period March 1, 2000 to July 7,
2000, the NAF Science & Technology Fund paid the same distributor distribution
and service fees in connection with its Class A and Class B shares of $2,052
and $24,120, respectively.

The Acquired Funds did not pay any brokerage commissions to affiliated
brokers for the fiscal year ended October 31, 2000.

PROPOSAL NO. 1(b): APPROVAL OF THE NEW SUBADVISORY AGREEMENT

THE NEW SUBADVISORY AGREEMENT

Description of the New Subadvisory Agreement

As a proposal separate from the proposal to approve a Reorganization,
shareholders of each Acquired Fund (other than the NAF Science & Technology
Fund) are being asked to approve the New Subadvisory Agreement between AGAM and
New AGIM to ensure that the applicable Acquired Funds receive subadvisory
services during the period prior to consummation of the Reorganization. This
Proposal No. 1(b) does not apply to the NAF Science & Technology Fund because
it is not subadvised by an affiliate of AGAM. The approval of the New
Subadvisory Agreement is contingent upon approval of the New Investment
Advisory Agreement, and accordingly, will not take effect if the New Investment
Advisory Agreement is not approved. If Proposals No. 1(a) and (b) are approved,
but a Reorganization is not approved by the shareholders of an Acquired Fund,
New AGIM will continue to serve as that Acquired Fund's subadviser under the
New Subadvisory Agreement. The terms of the New Subadvisory Agreement are the
same in all material respects as those of the Previous Subadvisory Agreement.
The New Subadvisory Agreement differs from the Previous Subadvisory Agreement
only with respect to the effective date and the potential for the subadvisory
services to be rendered by an affiliate of AGIM through New AGIM. The Previous
Subadvisory Agreement is dated June 1, 2000 and was last approved by the
shareholders of the applicable Acquired Funds at a meeting held on the same
date in connection with its initial approval. A description of the New
Subadvisory Agreement and the services to be provided by New AGIM is set forth
below. This description is qualified in its entirety by reference to the form
of the New Subadvisory Agreement attached to this Proxy Statement and
Prospectus as Exhibit IB.

Under the terms of the New Subadvisory Agreement between AGAM and New AGIM,
New AGIM will manage the investment and reinvestment of the assets of each
applicable Acquired Fund, subject to the supervision of the NAF Board. New AGIM
will formulate a continuous investment program for each such Acquired Fund
consistent with its investment objectives and policies. New AGIM will implement
such programs by purchases and sales of securities and will regularly report to
AGAM and the NAF Board with respect to their implementation.

As compensation for its services under the New Subadvisory Agreement, New
AGIM will receive a fee, as a percentage of average daily net assets payable
monthly and accrued daily as set forth in the table below. This fee is payable
by AGAM at no additional cost to Acquired Fund shareholders.

Acquired Fund Subadvisory Fee
------------- -------------------------------------------

NAF Stock Index Fund............ 0.20% of the first $2 billion and 0.10% on
the excess over $2 billion
NAF Aggressive Growth LifeStyle
Fund........................... 0.10%
NAF Moderate Growth LifeStyle
Fund........................... 0.10%
NAF Conservative Growth
LifeStyle Fund................. 0.10%

For the fiscal year ended October 31, 2000, AGAM paid total subadvisory fees
of $3,194,477. Of such amount, $2,047, $6,996, $6,368 and $5,736 (in each case
for the period July 7, 2000 to October 31, 2000) were attributable to payments
to AGIM in connection with the NAF Stock Index Fund, NAF Aggressive Growth
LifeStyle Fund, NAF Moderate Growth LifeStyle Fund and NAF Conservative Growth
LifeStyle Fund, respectively. From November 1, 1999 to July 7, 2000, VALIC, an
affiliate of AGAM, served as investment adviser to each of the Acquired Funds.
During this period, VALIC paid total subadvisory fees of $276,034. Of such
amount, $0 was attributable to payments to AGIM in connection with the Acquired
Funds.

VALIC, an affiliate of AGIM, also manages the investment portfolio of the
Stock Index Fund of North American Funds Variable Products I (the "NAFVPI Stock
Index Fund"), a mutual fund with a substantially similar investment objective
to the NAF Stock Index Fund. The total asset size of the NAFVPI Stock Index
Fund as of August 1, 2001 was $4,335,653,504. As compensation for its advisory
services in connection with

the NAFVPI Stock Index Fund, VALIC receives advisory fees of 0.35% of average
daily net assets (0.25% on assets over $500 million) payable monthly and
accrued daily. For the fiscal year ended May 31, 2000, AGIM received total
advisory fees of $13,283,779 in connection therewith. VALIC also receives
payments in connection with the NAFVPI Stock Index Fund pursuant to an
accounting services agreement. For the fiscal year ended May 31, 2000, VALIC
received total fees of $1,534,054 in connection therewith. No fees were waived
with respect to this Fund.

The Board of Trustees of North American Funds unanimously recommends that
the shareholders of each applicable Acquired Fund approve the New Subadvisory
Agreement. Shareholders of each Acquired Fund vote separately on the approval
of the New Subadvisory Agreement. Approval of the New Subadvisory Agreement by
one Acquired Fund is not contingent upon approval of the New Subadvisory
Agreement by any other Acquired Fund. If the New Subadvisory Agreement is not
approved by shareholders of an Acquired Fund, the NAF Board will determine the
appropriate actions to be taken with respect to such Acquired Fund's
subadvisory arrangements at that time.

Additional Information About AGIM

AGIM has been the subadviser to the NAF Stock Index Fund, NAF Aggressive
Growth LifeStyle Fund, NAF Moderate Growth LifeStyle Fund and NAF Conservative
Growth LifeStyle Fund since July 7, 2000. AGIM was formed in 1998 as a
successor to the investment management division of American General. Pursuant
to the Previous Subadvisory Agreement, AGIM managed the investment and
reinvestment of the assets of each such Acquired Fund subject to the
supervision of the NAF Board. AGIM has continued to perform these functions
under the Interim Subadvisory Agreement since the completion of the AIG Merger.
As of September 20, 2001, AGIM had approximately $1.45 billion in assets under
management.

AGIM is located at 2929 Allen Parkway, Houston, Texas 77019. The directors
and principal executive officer of AGIM, their position(s) with AGIM and a
description of their principal occupations are set forth below. Unless
otherwise indicated, the business address of each is 2929 Allen Parkway,
Houston, Texas 77019.

Position with AGIM and Principal
Name and Address Occupation(s)
---------------- -------------------------------------------

Richard W. Scott................. Director, President and Chief Executive
Officer; Senior Managing Director and head
of U.S. Fixed Income for AIG Global
Investment Corp.; formerly Vice Chairman,
Investment Management for American General.
Albert Gutierrez................. Director and Executive Vice President
(Since April 2000); prior to working at
AGIM, Mr. Gutierrez was Senior Vice-
President responsible for non-equity
research, trading and various insurance
company portfolios with Conseco Capital
Management from 1987 to 2000.

PROPOSAL NOS. 2(a)-(e): APPROVAL OF THE PLANS

COMPARISON OF THE FUNDS

Investment Policies

In addition to the principal investment policies set forth under "Summary--
The Funds" above, the Funds may also employ the investment policies listed
below.

The principal differences in these investment policies, each of which is
discussed in more detail below, are as follows:

With respect to the Stock Index Funds,

. the SunAmerica Stock Index Fund is limited in the amount of total assets
that may be subject to calls, whereas the NAF Stock Index Fund is not
subject to a similar limitation;

. the NAF Stock Index Fund may not purchase additional securities if
borrowing exceeds 5% of its total assets, whereas the SunAmerica Stock
Index Fund is not subject to a similar limitation;

. the NAF Stock Index Fund may only engage in short sales "against-the-
box," whereas the SunAmerica Stock Index Fund may engage in short sales
whether or not "against-the-box," up to 25% of net assets; and

. the SunAmerica Stock Index Fund is limited in the amount of total assets
it may invest in short-term investments, whereas the NAF Stock Index Fund
is not subject to a similar limitation.

With respect to the Science & Technology Funds,

. unlike the NAF Science & Technology Fund, the SunAmerica Science &
Technology Fund may also write (i.e., sell) covered call and put options
to enhance income through the receipt of premiums;

. the NAF Science & Technology Fund may only engage in short sales
"against-the-box", while the SunAmerica Science & Technology Fund may
engage in short sales whether or not "against-the-box;" and

. unlike the NAF Science & Technology Fund, the SunAmerica Science &
Technology Fund generally will not invest in debt securities in the
lowest rating categories (rated "CC" or lower by S&P or "Ca" or lower by
Moody's).

With respect to the Growth LifeStage Funds,

. the NAF Growth LifeStyle Funds may not purchase additional securities if
borrowing exceeds 5% of each Funds's total assets, whereas the SunAmerica
Growth LifeStage Funds are not subject to a similar limitation;

. unlike the NAF Growth LifeStyle Funds, the SunAmerica Growth LifeStage
Funds may make loans through repurchase agreements;

. the SunAmerica Growth LifeStage Funds are limited in the amount of total
assets they may invest in short-term investments, whereas the NAF Growth
LifeStyle Funds are not subject to similar limitations; and

With respect to all Funds,

. no Acquired Fund may sell put options if, as a result, the Acquired Fund
would be required to segregate more than 50% of its assets to cover its
potential obligations under put options other than those with respect to
futures contracts, whereas the Acquiring Funds have no similar
limitation.

All Funds

Derivatives. All Funds may invest in derivatives, including options and
futures. Each of the NAF Growth LifeStyle Funds and the SunAmerica Growth
LifeStage Funds has no present intention of doing so. A derivative instrument
is a contract whose value is based on the performance of an underlying asset. A
Fund will use derivatives for hedging purposes. Unlike the Acquired Funds,
however, the SunAmerica Science & Technology Fund may also write (i.e., sell)
covered call and put options to enhance income through the receipt of premiums.
Up to 25% of SunAmerica Stock Index Fund's total assets and up to 100% of
SunAmerica Science & Technology Fund's total assets may be subject to calls. An
Acquired Fund may not sell put options if, as a result, the Acquired Fund would
be required to segregate more than 50% of its assets to cover its potential
obligations under put options other than those with respect to futures
contracts.

Illiquid Securities. As a non-fundamental restriction, each Fund may invest
up to 15% of its net assets in illiquid securities (other than the Growth
LifeStage Funds, which, as a non-fundamental restriction, may not invest in
illiquid securities).

Borrowing. All Funds may borrow for temporary or emergency purposes and in
connection with reverse repurchase agreements, dollar rolls (with respect to
the NAF Stock Index Fund and all Acquiring Funds) and other similar
transactions. When borrowing for temporary or emergency purposes, each Fund may
borrow up to 33 1/3% of the value of its respective total assets (including
amounts borrowed) less liabilities (other than borrowings). The NAF Stock Index
Fund and the NAF Growth LifeStyle Funds may not purchase additional securities
if borrowing exceeds 5% of each Fund's total assets. Only the Growth LifeStage
Funds may borrow for other than temporary or emergency purposes. Each Fund's
policy regarding the use of leverage is a fundamental policy.

Lending. The Funds may not make loans, except through repurchase agreements
(other than with respect to the NAF Growth LifeStyle Funds) and the purchase of
portfolio securities consistent with a Fund's investment objectives and
policies. In addition, each Fund (other than the Growth LifeStage Funds) may
lend portfolio securities subject to comparable restrictions.

Sort Sales. The NAF Stock Index Fund and the NAF Science & Technology Fund
may engage in short sales "against-the-box." The SunAmerica Stock Index Fund
and SunAmerica Science & Technology Fund may also engage in short sales,
whether or not "against-the-box." A short sale occurs when a fund sells a
security it does not own in anticipation of a decline in the market value of
that security. A short sale is "against-the-box" to the extent that the Fund
contemporaneously owns, or has the right to obtain without payment, securities
identical to those sold short. The SunAmerica Stock Index Fund may not enter
into a short sale, including a short sale "against-the-box," if, as a result,
more than 25% of its net assets would be subject to such short sales. Up to
100% of the SunAmerica Science & Technology Fund's assets may be subject to
such short sales.

Cash and Short-Term Securities. Each Fund may, under certain circumstances,
invest in certain money market instruments. Certain of the Acquiring Funds are
subject to the following percentage of asset limitations with respect to their
short-term investments: 35% of total assets in the case of the SunAmerica Stock
Index Fund; and 10% of total assets in the case of the SunAmerica Growth
LifeStage Funds.

Defensive Investments. Each Fund may make temporary defensive investments
without limitation in response to adverse market, economic, political or other
conditions (although the Acquiring Funds are somewhat more limited in the
securities in which they may invest).

Science & Technology Funds

Fixed-Income Securities. Each Science & Technology Fund may invest in fixed
income securities, although each does so primarily to meet liquidity needs or
with respect to fixed income securities having

similar growth of capital potential to the equity securities in which it
invests. The SunAmerica Science & Technology Fund generally will not invest in
debt securities in the lowest rating categories (rated "CC" or lower by S&P or
"Ca" or lower by Moody's).

Foreign Securities. Each Science & Technology Fund may invest in the
securities of issuers located outside of the United States, including American
Depository Receipts ("ADRs") or other similar securities convertible into
foreign securities, such as European Depository Receipts ("EDRs") and Global
Depository Receipts ("GDRs").

Directors and Officers

SunAmerica Strategic Investment Series, Inc. is governed by the SunAmerica
Board, which currently consists of five individuals, four of whom are
SunAmerica Independent Directors.

The SunAmerica Board is responsible for the overall supervision of
SunAmerica Strategic Investment Series, Inc. and performs various duties
imposed on directors of investment companies by the Investment Company Act and
under SunAmerica Strategic Investment Series, Inc.'s Articles of Incorporation.
Directors and officers of SunAmerica Strategic Investment Series, Inc. are also
directors (or trustees) and officers of some or all of the other investment
companies managed, administered or advised by SAAMCo, and distributed by SACS
and other affiliates. The SunAmerica Board elects the Acquiring Funds'
officers. See "Directors and Officers" in the Acquiring Funds Statement.

The following table lists the Directors and executive officers of SunAmerica
Strategic Investment Series, Inc., their ages and principal occupations during
the past five years. The business address of each Director and executive
officer is The SunAmerica Center, 733 Third Avenue, New York, NY 10017-3204.
For the purposes of this Proxy Statement and Prospectus, the SunAmerica Mutual
Funds ("SAMF") consist of SunAmerica Equity Funds, SunAmerica Income Funds,
SunAmerica Money Market Funds, Inc., SunAmerica Style Select Series, Inc. and
SunAmerica Strategic Investment Series, Inc. An asterisk indicates that the
Director is an interested person of SunAmerica Strategic Investment Series,
Inc. within the meaning of Section 2(a)(19) of the Investment Company Act.

Position with
Name, Age and Address the Corporation Principal Occupations During Past 5 Years
--------------------- --------------- -----------------------------------------

S. James Coppersmith, Director Retired; formerly, President and General
67..................... Manager, WCVB-TV, a division of the Hearst
Corp. (1982 to 1994); Director/Trustee of
SAMF and Anchor Series Trust ("AST").

Samuel M. Eisenstat, Chairman of the Attorney, solo practitioner; Chairman of
60..................... Board the Boards of Directors/Trustees of SAMF
and AST.

Stephen J. Gutman, 57... Director Partner and Managing Member of B.B.
Associates LLC (menswear specialty
retailing and other activities) since June
1988; Director/Trustee of SAMF and AST.

Peter A. Harbeck*, 47... Director and Director and President, SAAMCo, since
President August 1995; Director, AIG Asset Management
International, Inc. ("AIGAMI") since
February 2000; Managing Director, John
McStay Investment Counsel, L.P. ("JMIC")
since June 1999; Director, SACS, since
August 1993; Director and President,
SunAmerica Fund Services, Inc. ("SAFS"),
since May 1988; President, SAMF and AST.

Position with
Name, Age and Address the Corporation Principal Occupations During Past 5 Years
--------------------- --------------- -----------------------------------------

Sebastiano Sterpa, 71... Director Founder and Chairman of the Board of the
Sterpa Group (real estate) since 1962;
Director, Real Estate Business Service and
Countrywide Financial; Director/Trustee of
SAMF.

J. Steven Neamtz, 42.... Vice President Executive Vice President, SAAMCo, since
April 1996; Director and Chairman of the
Board, AIGAMI, since February 2000; Vice
President, SAMF, since November 1999;
Director and President, SACS, since April
1996.

Peter C. Sutton, 36..... Treasurer Senior Vice President, SAAMCo, since April
1997; Vice President, AIGAMI, since
February 2000; Treasurer and Controller of
Seasons Series Trust ("Seasons"),
SunAmerica Series Trust ("SAST") and Anchor
Pathway Fund ("APF") since February 2000;
Treasurer of SAMF and AST since February
1996; Vice President of SAST and APF since
1994; formerly Assistant Treasurer of SAST
and APF from 1994 to February 2000; Vice
President, Seasons, since April 1997;
formerly Vice President, SAAMCo, from 1994
to 1997.

Robert M. Zakem, 43..... Secretary and Chief Senior Vice President and General Counsel,
Compliance Officer SAAMCo, since April 1993; Vice President,
General Counsel and Assistant Secretary,
AIGAMI, since February 2000; Executive Vice
President, General Counsel and Director,
SACS, since August 1993; Vice President,
General Counsel and Assistant Secretary,
SAFS, since January 1994; Vice President,
SAST, APF and Seasons; Assistant Secretary,
SAST and APF, since September 1993;
Assistant Secretary, Seasons, since April
1997.

At a meeting of the SunAmerica Board held on August 22, 2001, the SunAmerica
Board elected Dr. Judith L. Craven and William F. Devin to the SunAmerica
Board, effective on or about November 9, 2001. Dr. Craven and Mr. Devin are
currently members of the NAF Board. Dr. Craven and Mr. Devin would join the
SunAmerica Board as SunAmerica Independent Directors and as members of the
Audit and Nominating Committees.

The following table lists the ages, business addresses and principal
occupations during the past five years of Dr. Craven and Mr. Devin.

Dr. Judith L. Craven, Retired Administrator. Trustee, North American Funds
55..................... Variable Product Series II, 15 investment portfolios
3212 Ewing Street (November 1998 to present); Director, North American
Houston, TX 77004 Funds Variable Product Series I, 21 investment portfolios
(August 1998 to present); Director, USLIFE Income Fund,
Inc. (November 1998 to present); Director, Compaq
Computer Corporation (1992 to present); Director, A.G.
Belo Corporation, a media company (1992 to present);
Director, Sysco Corporation, a food marketing and
distribution company (1996 to present); Director, Luby's
Inc., a restaurant chain (1998 to present); Director,
University of Texas Board of Regents (May 2001 to
present). Formerly, Director, CypressTree Senior Floating
Rate Fund, Inc. (June 2000 to May 2001); Formerly,
President, United Way of the Texas Gulf Coast, a not for
profit organization (1992-1998); Formerly, Director,
Houston Branch of the Federal Reserve Bank of Dallas
(1992-2000); Formerly, Board Member, Sisters of Charity
of the Incarnate Word (1996-1999).

William F. Devin, 62.... Member of the Board of Governors, Boston Stock Exchange
44 Woodland Road (1985 to present); Formerly, Executive Vice President,
Braintree, MA 02184 Fidelity Capital Markets, a division of National
Financial Services Corporation (1966-1996); Formerly,
Director, CypressTree Senior Floating Rate Fund, Inc.
(October 1997 to May 2001).

SunAmerica Strategic Investment Series, Inc. pays each SunAmerica
Independent Director annual compensation in addition to reimbursement of out-
of-pocket expenses in connection with attendance at meetings of the SunAmerica
Board. Specifically, each SunAmerica Independent Director received a pro rata
portion (based upon the SunAmerica Strategic Investment Series, Inc.'s net
assets) of an aggregate of $40,000 in annual compensation for acting as
director or trustee to SAMF. In addition, each SunAmerica Independent Director
received $20,000 in annual compensation for acting as trustee for AST.
Beginning January 1, 2001 each SunAmerica Independent Director of the retail
funds in SAMF receives an additional $2,500 per quarterly meeting. In addition,
Mr. Eisenstat receives an aggregate of $2,000 in annual compensation for
serving as Chairman of the Boards of the retail funds in SAMF. Officers of
SunAmerica Strategic Investment Series, Inc. receive no direct remuneration in
such capacity from SunAmerica Strategic Investment Series, Inc. or any of the
Acquiring Funds.

In addition, each SunAmerica Independent Director also serves on the Audit
Committee of the SunAmerica Board. The Audit Committee is charged with
recommending to the full SunAmerica Board the engagement or discharge of
SunAmerica Strategic Investment Series, Inc.'s independent accountants;
directing investigations into matters within the scope of the independent
accountant's duties; reviewing with the independent accountants the audit plan
and results of the audit; approving professional services provided by the
independent accountants and other accounting firms; reviewing the independence
of the independent accountants; considering the range of audit and non-audit
fees; and preparing and submitting Committee minutes to the full SunAmerica
Board. Each member of the Audit Committee receives an aggregate of $5,000 in
annual compensation for serving on the Audit Committee of SAMF and AST. With
respect to SunAmerica Strategic Investment Series, Inc., each member of the
Committee receives a pro rata portion of the $5,000 annual compensation, based
on the relative net assets of SunAmerica Strategic Investment Series, Inc.
SunAmerica Strategic Investment Series, Inc. also has a Nominating Committee,
comprised solely of SunAmerica Independent Directors, which recommends to the
SunAmerica Board those persons to be nominated for election as Directors by
shareholders and selects and proposes nominees for election by Directors
between shareholders' meetings. Members of the Nominating Committee serve
without compensation.

The Directors (and Trustees) of SAMF and AST have adopted the SunAmerica
Disinterested Directors' and Trustees' Retirement Plan (the "Retirement Plan")
effective January 1, 1993 for the SunAmerica Independent Directors. The
Retirement Plan provides generally that if a SunAmerica Independent Director
(or Trustee) who has at least 10 years of consecutive service as a
disinterested Director (or Trustee) of any SAMF or AST (an "Eligible Director")
retires after reaching age 60 but before age 70 or dies while a Director, such
person will be eligible to receive a retirement or death benefit from each SAMF
with respect to which he or she is an Eligible Director. With respect to
Sebastiano Sterpa, the SunAmerica Independent Directors have determined to make
an exception to existing policy and allow Mr. Sterpa to remain on the
SunAmerica Board past age 70, until he has served for ten years. Mr. Sterpa
ceased accruing retirement benefits upon reaching age 70, although such
benefits will continue to accrue interest as provided for in the Retirement
Plan. As of each birthday, prior to the 70th birthday, each Eligible Director
will be credited with an amount equal to (i) 50% of his or her regular fees
(excluding committee fees) for services as a disinterested Director of each
SAMF for the calendar year in which such birthday occurs, plus (ii) 8.5% of any
amounts credited under clause (i) during prior years. An Eligible Director may
receive any benefits payable under the Retirement Plan, at his or her election,
either in one lump sum or in up to fifteen annual installments.

The following table sets forth information summarizing the aggregate
compensation of each SunAmerica Independent Director for his services as a
member of the SunAmerica Board for the fiscal year ended October 31, 2000,
except as otherwise indicated. Neither the Directors who are interested persons
of SunAmerica Strategic Investment Series, Inc. nor any officers of SunAmerica
Strategic Investment Series, Inc. receive any compensation.

Pension or
Retirement Total Compensation
Benefits Accrued From Registrant
Aggregate as Part of Estimated Annual and Fund Complex
Compensation from Corporation Benefits Upon Paid to
Director Registrant Expenses Retirement* Directors**
-------- ----------------- ---------------- ---------------- ------------------

S. James Coppersmith.... $764 $48,315 $29,670 $67,500
Samuel M. Eisenstat..... $804 $41,033 $46,083 $71,500
Stephen J. Gutman....... $764 $42,230 $60,912 $67,500
Sebastiano Sterpa***.... $797 $10,579 $ 7,900 $45,833

--------
* Assuming participant elects to receive benefits in 15 yearly installments.
** Information is as of March 31, 2001 for the five investment companies in the
complex that pay fees to these directors/trustees. The complex consists of
SAMF and AST.
*** Mr. Sterpa is not a trustee of AST.

Management Arrangements

Comparison of Management and Administrative Arrangements and Fees

AGAM serves as the investment adviser for the Acquired Funds and SAAMCo
serves as the investment adviser for the Acquiring Funds. Each of AGAM and
SAAMCo is responsible for the management of the investment portfolio of each
Acquired Fund and Acquiring Fund, respectively, and for providing certain
administrative services to such Fund.

AGAM was organized as a Delaware corporation in 1996 and is located at 286
Congress Street, Boston, Massachusetts, 02210. Prior to the AIG Merger, AGAM
and the NAF Distributor were both wholly owned subsidiaries of American
General. Prior to the AIG Merger, American General was one of the nation's
largest diversified financial services organizations with assets of
approximately $128 billion and market capitalization of $23 billion at June 30,
2001. AGAM is now a subsidiary of AIG.

SAAMCo was organized as a Delaware corporation in 1982 and is located at The
SunAmerica Center, 733 Third Avenue, New York, NY 10017-3204. SAAMCo is a
wholly owned subsidiary of SunAmerica Inc., which

in turn is a wholly owned subsidiary of AIG. AIG, a Delaware corporation, is a
holding company which through its subsidiaries is engaged in a broad range of
insurance and insurance-related activities and financial services in the United
States and abroad. AIG's primary activities include both general and life
insurance operations. Other significant activities include financial services
and asset management. At June 30, 2001, SAAMCo managed, advised and/or
administered more than $28.5 billion of assets.

Comparison of the NAF Investment Advisory Agreement and SunAmerica
Investment Advisory Agreement. The SunAmerica Investment Advisory Agreement is
similar to the NAF Investment Advisory Agreement, except for certain matters,
including the effective dates and the identity of the adviser.

The advisory fees payable by the Acquired Funds to AGAM are discussed above
under "Proposal No. 1(a): Approval of the New Investment Advisory Agreement."
The advisory fee rate payable by each Combined Fund after consummation of the
Reorganizations will be the same as the advisory fee rates payable by the
Acquired Funds. The effective advisory fees payable by each Acquiring Fund to
SAAMCo under the SunAmerica Investment Advisory Agreement are at the same
annual rate as the advisory fees payable by the respective Acquired Fund under
the NAF Investment Advisory Agreement.

The SunAmerica Investment Advisory Agreement provides that in the absence of
willful misfeasance, bad faith, gross negligence or reckless disregard of
SAAMCo's (and its affiliates') obligations or duties thereunder ("disabling
conduct"), SAAMCo is not subject to liability to an Acquiring Fund (or to any
shareholder thereof) for any act or omission in the course of rendering
services to such Acquiring Fund (except to the extent specified in the
Investment Company Act concerning loss resulting from a breach of fiduciary
duty with respect to the receipt of compensation for services). The SunAmerica
Investment Advisory Agreement also provides that except for such disabling
conduct, an Acquiring Fund will indemnify SAAMCo (and its affiliates) from any
liability arising from SAAMCo's conduct under the SunAmerica Investment
Advisory Agreement. The NAF Investment Advisory Agreement does not contain
similar provisions.

Both the NAF Investment Advisory Agreement and the SunAmerica Investment
Advisory Agreement provide that the adviser may, at its own cost and expense
and subject to the requirements of the Investment Company Act, retain one or
more subadvisers (each a "Subadviser") to manage all or a portion of the
investment portfolio of an Acquired Fund or Acquiring Fund, respectively.

Subadvisory Arrangements. In addition to the ability to retain Subadvisers
under their respective investment advisory agreements referenced above, each of
AGAM and SAAMCo is authorized to retain (or change) such unaffiliated
Subadviser(s) without shareholder approval pursuant to separate "Manager of
Managers" orders granted by the Commission. AGAM and SAAMCo are ultimately
responsible under their respective "Manager of Managers" order to oversee any
Subadvisers for the Acquired Funds and Acquiring Funds, respectively. AGAM has
retained T. Rowe Price as Subadviser for the NAF Science & Technology Fund
pursuant to the Acquired Funds' "Manager of Managers" order. As of the date
hereof, SAAMCo has also appointed T. Rowe Price as Subadviser to the SunAmerica
Science & Technology Fund pursuant to the Acquiring Funds' "Manager of
Managers" order. AGAM has retained New AGIM for each of the other Acquired
Funds, subject to shareholder approval; and SAAMCo has retained New AGIM for
the SunAmerica Stock Index Fund. Accordingly, if shareholders approve the
Reorganizations, following consummation of the Reorganizations, the portfolios
of the Acquired Funds will be managed by SAAMCo as part of the Combined Funds
(although New AGIM and T. Rowe Price will be responsible for subadvising the
investment portfolios of the Stock Index Combined Fund and the Science &
Technology Combined Fund, respectively).

The current Subadvisers of the Acquired Funds as well as certain information
regarding each Subadviser are set forth below:

Acquired Fund: Subadviser: Information:
-------------- ----------- ------------

NAF Stock Index Fund, AGIM, 2929 Allen Parkway, AGIM is a registered investment
NAF Aggressive Growth Houston, Texas 77019 adviser and a wholly owned
LifeStyle Fund, NAF subsidiary of AGAM. As of June
Moderate Growth 30, 2001, AGIM had approximately
LifeStyle Fund and NAF $77 billion under management.
Conservative Growth
LifeStyle Fund
NAF Science & Technology T. Rowe Price, T. Rowe Price is a registered
Fund 100 East Pratt Street, investment adviser. As of June
Baltimore, Maryland 21202 30, 2001, T. Rowe Price and its
affiliates served as investment
adviser to more than 80 stock,
bond and money market funds, and
managed approximately $158.6
billion.

Under the terms of each of the Subadvisory Agreements between AGAM and a
Subadviser (the "NAF Subadvisory Agreements"), the Subadviser for the
respective Acquired Fund manages the investment and reinvestment of the assets
of such Acquired Fund, subject to the supervision of the NAF Board. Under the
terms of each SunAmerica Subadvisory Agreement, the Subadviser for the
respective Acquiring Fund manages the investment and reinvestment of the assets
of such Acquiring Fund, subject to the oversight and review of SAAMCo. Under
both the NAF and the SunAmerica Subadvisory Agreements, the Subadviser
formulates a continuous investment program for the applicable Acquired Fund or
Acquiring Fund, as applicable, consistent with such Fund's investment
objectives and policies. The Subadviser implements such programs by purchases
and sales of securities and regularly reports to AGAM and the NAF Board or
SAAMCo and the SunAmerica Board, as the case may be, with respect to their
implementation.

Each of the SunAmerica Subadvisory Agreements provides that in the absence
of willful misfeasance, bad faith, gross negligence or reckless disregard of
the Subadviser's (and its affiliates') obligations or duties thereunder
("disabling conduct"), the Subadviser is not subject to liability to an
Acquiring Fund (or to any shareholder thereof) for any act or omission in the
course of rendering services to such Acquiring Fund (except to the extent
specified in the Investment Company Act concerning loss resulting from a breach
of fiduciary duty with respect to the receipt of compensation for services).
The SunAmerica Subadvisory Agreements also provide that except for such
disabling conduct, an Acquiring Fund will indemnify the Subadviser (and its
affiliates) from any liability arising from the Subadviser's conduct under the
agreement. With respect to indemnification, the NAF Subadvisory Agreements do
not contain a similar provision.

As compensation for their services, the Subadvisers receive fees from AGAM
computed separately for each Acquired Fund. Such fees are paid out of AGAM's
advisory fee at no additional cost to the Acquired Funds or their shareholders.
The subadvisory fees paid by AGAM in connection with the Acquired Funds are
discussed above under "Proposal No. 1(b): Approval of the New Subadvisory
Agreement." Absent any applicable fee waivers, the fee rate that AGAM is
obligated to pay to each Subadviser under its respective Subadvisory Agreement
is as follows:

Acquired Fund: Subadvisory Fee:
-------------- ----------------

NAF Stock Index Fund 0.20% of the first $2 billion and 0.10% on the
excess over $2 billion
NAF Science & Technology Fund 0.60% of the first $500 million and 0.55% on the
excess over $500 million
NAF Aggressive Growth
LifeStyle Fund 0.10%
NAF Moderate Growth LifeStyle
Fund 0.10%
NAF Conservative Growth
LifeStyle Fund 0.10%

SAAMCo will directly manage the investment portfolios of each of the
SunAmerica Growth LifeStage Funds and will directly manage the investment
portfolios of each of the Growth LifeStage Combined Funds after the
Reorganizations. SAAMCo has retained New AGIM as Subadviser to manage the
investment portfolio of the SunAmerica Stock Index Fund and T. Rowe Price as
Subadviser to manage the investment portfolio of the SunAmerica Science &
Technology Fund. Accordingly, New AGIM will manage the investment portfolio of
the Stock Index Combined Fund and T. Rowe Price will manage the investment
portfolio of the Science & Technology Combined Fund. SunAmerica will pay New
AGIM and T. Rowe Price advisory fees in connection with these duties at the
same rate as each was paid by AGAM under the Previous Subadvisory Agreement
applicable to each.

Distribution and Shareholder Servicing Arrangements

Distributor

American General Funds Distributors, Inc. (previously defined as "AGFD" or
the "NAF Distributor"), an affiliate of AGAM, acts as the principal distributor
of the shares of the Acquired Funds. SunAmerica Capital Services, Inc.
(previously defined as "SACS" or the "SunAmerica Distributor"), an affiliate of
SAAMCo, acts as the distributor of the shares of the Acquiring Funds. As
compensation for their respective services, AGFD and SACS receive any initial
or deferred sales charges applicable to the Acquired Funds and Acquiring Funds,
respectively. In addition, AGFD and SACS receive fees under each respective
Acquired Fund's and Acquiring Fund's plan pursuant to Rule 12b-1 under the
Investment Company Act. The address of the NAF Distributor is 286 Congress
Street, Boston, Massachusetts 02210. The address of the SunAmerica Distributor
is The SunAmerica Center, 733 Third Avenue, New York, New York 10017-3204.
After consummation of the Reorganizations, the SunAmerica Distributor will
provide distribution services to each Combined Fund.

Distribution and Service (12b-1) Fees

Each of the Acquired Funds and Acquiring Funds have adopted a plan under
Rule 12b-1 under the Investment Company Act that allows it to pay distribution
and other fees for the sale and distribution of its shares. Class A, Class B
and Class C shares of each Acquired Fund and Class A, Class B and Class II
shares of each Acquiring Fund are subject to the same respective distribution
and account maintenance and service fees pursuant to the applicable plan under
Rule 12b-1. The table below sets forth the distribution and account maintenance
and service fees for each of these classes.

Stock Index Funds

Science & Technology Funds

Account
Acquired Acquiring Maintenance
Fund Class Fund Class Distribution Fee and Service Fee
---------- ---------- ---------------- ---------------

A A 0.10% 0.25%
B B 0.75% 0.25%
C II 0.75% 0.25%

Aggressive Growth LifeStage Funds

Moderate Growth LifeStage Funds

Conservative Growth LifeStage Funds

Account
Acquired Acquiring Maintenance
Fund Class Fund Class Distribution Fee and Service Fee
---------- ---------- ---------------- ---------------

A A 0.10% None
B B 0.75% None
C II 0.75% None

Because these fees are paid out of a Fund's assets on an ongoing basis, over
time they will increase the cost of your investment and may cost you more than
paying other types of sales charges.

Shareholder Servicing Fees for Class I

The Acquired Funds have entered into a Services Agreement (the "NAF Services
Agreement") with AGAM for the provision of recordkeeping and shareholder
services to retirement and employee benefit plans and the NAF Growth LifeStyle
Funds, each of which invest in Institutional Class I shares of certain of the
Acquired Funds. Under the NAF Services Agreement, as compensation for services
rendered, AGAM receives a fee on Institutional Class I shares of each Acquired
Fund, other than the NAF Growth LifeStyle Funds, equal to 0.25% of average net
assets of such class. SACS will provide these services after the
Reorganizations with respect to Class I shares of the Combined Funds for the
same fee.

Other Service Agreements with Affiliates

SAFS acts as a servicing agent assisting State Street in connection with
certain services offered to the shareholders of each of the Acquiring Funds
pursuant to the terms of a Service Agreement (the "SunAmerica Service
Agreement"). Under the SunAmerica Service Agreement, as compensation for
transfer agency services rendered, SAFS receives a fee from each Acquiring
Fund, computed and payable monthly based upon an annual rate of 0.22% of
average daily net assets of each Acquiring Fund with respect to Class A, Class
B and Class II shares. Upon completion of the Reorganizations, SAFS will
receive the same fee with respect to Class I shares of each Acquiring Fund.
From this fee, SAFS pays a fee to State Street, and its affiliate, National
Financial Data Services. In addition, pursuant to the Service Agreement, SAFS
may receive reimbursement of its costs in providing shareholder services on
behalf of the Acquiring Funds. SAFS is located at The SunAmerica Center, 733
Third Avenue, New York, New York 10017-3204.

Purchase, Exchange and Redemption of Shares

The following chart highlights the purchase, redemption and exchange
features of the Acquired Funds as compared to such features of the Acquiring
Funds.

Purchase, Redemption and
Exchange Features Acquired Funds Acquiring Funds
------------------------ -------------- ---------------

Minimum initial . non-retirement accounts: . non-retirement accounts:
investment $1000 $500
. retirement accounts: $50 . retirement accounts: $250
. automatic investment . dollar cost averaging:
programs: $50 $500 to open

Class B shares are available
for purchases of $250,000 or
less. Class C shares are
available for purchases
under $1 million.
Institutional Class I shares
are available for purchases
of $1 million or more.

Minimum subsequent . non-retirement account:
investments $50 $100
. retirement account: $25
. dollar cost averaging: at
least $25 per month

Initial Sales Charge (as Class A: 5.75% Class A: 5.75%
a percentage of Class B: None Class B: None
offering price) Class C: None Class II: 1.00%
Institutional Class I: None Class I: None
Purchases over $1 million Initial sales charge is
are sold without an initial waived for certain investors
sales charge

Purchase, Redemption
and Exchange Features Acquired Funds Acquiring Funds
--------------------- -------------- ---------------

Deferred Sales Charge Class A: Purchases of shares Class A: Purchases of Class
worth $1 million or more A shares of $1 million or
that are sold without an more that are redeemed
initial sales charge and within a certain period of
redeemed within 1 year are time are subject to a CDSC
subject to a 1% CDSC at (1% for redemptions within
redemption (b) one year of purchase and
0.50% for redemptions after
the first year and within
the second year of purchase)
(b)

Class B: Shares redeemed Class B: Shares redeemed
within 6 years are subject within 6 years are subject
to a CDSC (a)(b) to a CDSC (a)(b)

Class II: Shares redeemed
Class C: Shares redeemed within 18 months after
within one year are subject purchase are subject to a 1%
to a 1% CDSC (b) CDSC (b)

Institutional Class I: None Class I: None

Purchases By mail (check), wire or
By mail (check), wire or through a broker or
through broker-dealers financial advisor

Redemption Classes A, B and C: By mail, Class A, B and II: By mail
wire (if a minimum of (any amount), wire,
$1,000), telephone or telephone (for amounts less
through broker-dealers than $100,000) or through a
broker or financial advisor

Class I: contact the Class I: contact the
financial intermediary (or financial intermediary (or
other organization) from other organization) from
whom shares were purchased whom shares were purchased

Conversion Class B shares automatically Class B shares automatically
convert into Class A shares convert into Class A shares
eight years after purchase approximately eight years
after purchase

Exchanges Shares of an Acquired Fund Shares of an Acquiring Fund
may be exchanged for shares may be exchanged for shares
of the same class of any of the same class of any
other Acquired Fund or other other fund distributed by
series of North American SACS
Funds

For Institutional Class I
shares, all or part of an
existing plan balance may be
exchanged from one
investment option to another
if permitted by an employer
retirement plan

(a) The CDSC of Class B shares of the Acquiring Funds is either the same as or
less than the CDSC relating to Class B shares of the Acquired Funds. The
table below sets forth the schedule of Class B CDSC for all Funds.

CDSC on shares being sold

Acquired Acquiring
Years after Purchase Funds Funds
-------------------- -------- ---------

1st year..................................................... 5.00% 5.00%
2nd year..................................................... 5.00% 4.00%
3rd year..................................................... 4.00% 3.00%
4th year..................................................... 3.00% 3.00%
5th year..................................................... 2.00% 2.00%
6th year..................................................... 1.00% 1.00%
7th year and thereafter...................................... None None

(b) The CDSC schedules applicable to Class A, Class B and Class C shares of an
Acquired Fund will continue to apply to the respective Corresponding Shares
received in the applicable Reorganization by shareholders of a Combined
Fund who were shareholders of the respective Acquired Fund as of the date
of the closing of such Reorganization (even if you exchange your shares for
shares of another fund distributed by SACS). Each CDSC is based on the
original purchase cost or the current market value of the shares being
sold, whichever is less. Future purchases of Class A, Class B or Class II
Shares of a Combined Fund will be subject to the CDSC schedule applicable
to the Combined Fund. There is no CDSC on Combined Fund shares that are
purchased through reinvestment of dividends. In the case of a partial
redemption of Combined Fund shares, those shares in the shareholder's
account that are not subject to a CDSC will be sold first. If there are not
enough of these shares available, shares that have the lowest CDSC will be
sold next.

Dividend Distribution and Account Policies

The following is a summary of the dividend distribution and account policies
of each of the Funds and is qualified in its entirety by the more complete
information contained in the Acquired Funds Prospectuses, Acquiring Funds
Prospectus, Acquired Funds Statement and Acquiring Funds Statement.

Valuation of Fund Shares. The net asset value per share for each Fund and
class is determined once daily as of the close of regular trading on the New
York Stock Exchange (generally 4 p.m. Eastern Time) by dividing the net assets
(the value of all assets less liabilities) of each class by the number of its
shares outstanding. See "Purchase, Redemption and Pricing--Determination of Net
Asset Value" in the Acquired Funds Statement and "Determination of Net Asset
Value" in the Acquiring Funds Statement.

Buy and Sell Prices. When you buy shares of a Fund, you pay the net asset
value plus any applicable sales charges. When you sell shares of a Fund, you
receive the net asset value minus any applicable CDSCs.

Dividends. Each of the Funds declares and pays capital gains and income
dividends, if any, annually. See "Pricing of Fund Shares" in the Acquired Funds
Prospectus and "Dividends, Distributions and Taxes--Dividends and
Distributions" in the Acquiring Funds Statement.

Dividend Reinvestments. The policy relating to dividend reinvestments is
substantially the same for all Funds. Unless cash payment is requested (and
such payment is more than $10 in the case of the Acquiring Funds), all
dividends and distributions, if any, will be reinvested. Alternatively, in the
case of the Acquiring Funds, dividends and distributions may be reinvested in
any fund distributed by SACS. See "Pricing of Fund Shares" in the Acquired
Funds Prospectus and "Dividends, Distributions and Taxes--Dividends and
Distributions" in the Acquiring Funds Statement.

Redemptions-in-kind. Each Acquired Fund reserves the right to pay redemption
proceeds in whole or in part by a distribution "in kind" of securities held by
the Acquired Fund, subject to the limitation that each Acquired Fund is
obligated to redeem shares solely in cash up to the lesser of $250,000 or 1% of
the net asset value of the Acquired Fund during any 90-day period for any one
account. Each Acquiring Fund also may pay redemption proceeds by a distribution
"in kind" of securities held by the Acquiring Fund, if it

determines that it would be detrimental to the best interests of the remaining
shareholders of the Acquiring Fund to make payment of redemption proceeds
wholly or partly in cash. See "Purchase Redemption and Pricing--Redemption in
Kind" in the Acquired Funds Statement and "Additional Information Regarding
Redemption of Shares" in the Acquiring Funds Statement.

Payment Following Redemption. Each Fund will normally send the proceeds from
a redemption (less any applicable CDSC) on the next business day, but may delay
payment for up to seven days. Payment may be delayed if the shares to be
redeemed were purchased by a check that has not cleared. During periods of
extreme volatility or market crisis, each Fund may temporarily suspend the
right to redemption and may postpone the payment of proceeds, as allowed by the
federal securities laws. See "Shareholder Account Information--Transaction
Policies" and "Additional Information Regarding Redemption of Shares" in the
Acquiring Funds Prospectus and Acquiring Funds Statement, respectively, and
"Section II: Investing in the North American Funds" and "Purchase, Redemption
and Pricing--Payment for the Shares Presented" in the Acquired Funds
Prospectuses and Acquired Funds Statement, respectively.

Programs that Reduce Sales Charges. Each of the Funds offers programs
pursuant to which shareholders pay reduced sales charges. With respect to the
Acquired Funds and the Acquiring Funds, these programs are only applicable to
purchases of Class A shares. Under the Rights of Accumulation program, a
shareholder pays the sales charge applicable to the shareholder's total account
balance in all classes of shares. Under a Letter of Intent (or statement of
intention), a shareholder agrees to invest a certain amount over 13 months and
will pay the sales charge based on the shareholder's goal. In addition, the
Acquiring Funds also offer reduced sales charges for group purchases, pursuant
to which members of qualified groups may purchase Class A shares of an
Acquiring Fund under the Rights of Accumulation program described above. The
Acquiring Funds also offer a Combined Purchase Privilege, pursuant to which
certain persons may qualify for sales charge reductions or elimination by
combining purchases of Acquiring Fund shares into a single transaction. See
"Section II: Investing in the North American Funds" in the Acquired Funds
Prospectuses and "Additional Information Regarding Purchase of Shares" in the
Acquiring Funds Statement for more information regarding these programs.

Reinstatement Privileges. Each of the Funds offers a reinstatement
privilege. In the case of the Acquired Funds, if a shareholder redeems Class A
shares (under $1 million) and reinvests within 90 days, the shareholder will
not have to pay a sales charge. If a shareholder redeems Class A shares over $1
million, or Class B or Class C shares and pays a CDSC and then reinvests within
90 days, the shareholder's account will be credited the amount of the CDSC. In
the case of the Acquiring Funds, a shareholder may redeem shares of an
Acquiring Fund and within one year after the sale invest some or all of the
proceeds in the same share class of the same Acquiring Fund without a sales
charge. A shareholder may use the reinstatement privilege only one time after
redeeming such shares. If a shareholder paid a CDSC on the redemption of his or
her shares, the shareholder's account will be credited with the dollar amount
of the CDSC at the time of redemption. See "Account Services" in the Acquired
Funds Prospectus relating to Class A, Class B, and Class C shares and
"Shareholder Account Information" in the Acquiring Funds Prospectus for more
information regarding this privilege.

Other Shareholder Services. Each of the Acquired Funds and Acquiring Funds
offers other shareholder services which are similar, although not identical,
such as automatic investment plans and systematic withdrawal plans. In
addition, Anchor National Life Insurance Company offers an Asset Protection
Plan to certain investors in the Acquiring Funds, which provides for benefits
payable at death that relate to the amounts paid to purchase Acquiring Fund
shares (and not subsequently redeemed prior to death) and to the value of
Acquiring Fund shares held for the benefit of insured persons. Anchor National
Life Insurance Company charges a premium for this coverage. For more
information regarding these additional shareholder services, see "Account
Services" in the Acquired Funds Prospectuses and "Shareholder Account
Information" and "Additional Information Regarding Purchase of Shares" in the
Acquiring Funds Prospectus and Acquiring Funds Statement, respectively.

Small Accounts. The Acquired Funds require that you maintain a minimum
account balance of $500, or $50 for retirement plans and other automatic
investing programs. The Acquiring Funds require that you

maintain a minimum account balance of $500, or $250 for retirement plan
accounts. If your account with an Acquiring Fund falls below the minimum
requirement due to withdrawals, you may be asked to purchase more shares within
60 days. If you do not take action, the Acquiring Fund may close out your
account and mail you the proceeds. Alternatively, you may be charged a $2.00
monthly charge to maintain your account with an Acquiring Fund. Your account
with an Acquiring Fund will not be closed if its drop in value is due to
performance of the Acquiring Fund or the effects of sales charges.

Performance

General

The following tables provide performance information for shares of the Funds
for the periods indicated. Past performance is not indicative of future
performance. Each Acquiring Fund has been recently created and has not yet
commenced operations; consequently, it does not have an investment performance
record. After the Reorganizations, each Combined Fund, as a successor to its
respective Acquired Fund, will assume and publish the investment performance
record of the relevant Acquired Fund.

Average annual total return is determined separately for each Class in
accordance with a formula specified by the Commission. Average annual total
return is computed by finding the average annual compounded rates of return for
the 1-, 3-, 5-, and 10-year periods or for the lesser included periods of
effectiveness. The calculation assumes that:

(a) The maximum sales load (i.e., either the front-end sales load or the
CDSC that would be applicable to a complete redemption of the
investment at the end of the specified period) is deducted from the
initial $1,000 purchase payment;

(b) All dividends and distributions are reinvested at net asset value; and

(c) Complete redemption occurs at the end of the 1-, 3-, 5-, or 10-year
periods or fractional portion thereof with all nonrecurring charges
deducted accordingly.

Acquired Funds+

Average Annual Total Returns
(Periods Ended June 30, 2001)
--------------------------------------------
Year
One Three Five Ten Since to
Year Years Years Years Inception Date
------ ----- ----- ----- ---------- ------

NAF Stock Index Fund
Class A....................... -20.26% N/A N/A N/A 2.11% (1) -12.30%
Class B....................... -20.20% N/A N/A N/A 1.93% (1) -12.02%
Class C....................... N/A N/A N/A N/A -20.46% (2) -8.11%
Institutional Class I*........ N/A N/A N/A N/A N/A(1) N/A
NAF Science & Technology Fund
Class A....................... -51.69% N/A N/A N/A -47.67% (3) -29.98%
Class B....................... -51.74% N/A N/A N/A -47.80% (3) -29.74%
Class C....................... N/A N/A N/A N/A -50.73% (4) -26.77%
Institutional Class I......... -48.63% N/A N/A N/A -45.19% (3) -25.66%
NAF Aggressive Growth LifeStyle
Fund
Class A....................... -21.54% N/A N/A N/A 4.30% (1) -15.72%
Class B....................... -21.34% N/A N/A N/A 5.02% (1) -15.30%
Class C....................... N/A N/A N/A N/A -17.41% (5) -11.75%
Institutional Class I......... -16.62% N/A N/A N/A 6.68% (1) -10.37%
NAF Moderate Growth LifeStyle
Fund
Class A....................... -14.23% N/A N/A N/A 4.55% (1) -11.31%
Class B....................... -13.94% N/A N/A N/A 5.40% (1) -10.86%
Class C....................... N/A N/A N/A N/A -12.32% (4) -7.19%
Institutional Class I......... -8.97% N/A N/A N/A 6.95% (1) -5.81%
NAF Conservative Growth
LifeStyle Fund
Class A....................... -9.70% N/A N/A N/A 4.61% (1) -8.75%
Class B....................... -9.39% N/A N/A N/A 5.40% (1) -8.38%
Class C....................... N/A N/A N/A N/A -6.59% (6) -4.71%
Institutional Class I......... -4.16% N/A N/A N/A 6.96% (1) -3.18%

--------

+ Each Acquiring Fund has been recently created and has not yet commenced
operations; consequently, it does not have an investment performance record.

* No Institutional Class I performance is shown for the NAF Stock Index Fund,
because no Institutional Class I shares are currently outstanding for this
Fund.

(1) Since 11/2/98.
(2) Since 7/17/00.
(3) Since 3/1/00.
(4) Since 7/12/00.
(5) Since 8/10/00.
(6) Since 7/20/00.

For the periods shown above, AGAM waived certain fees in respect of the NAF
Stock Index Fund and NAF Science & Technology Fund. Absent such waivers, the
returns shown above would be lower.

Shareholder Rights

Shareholder rights are the same in all of the Funds. Each full share and
fractional share of a Fund entitles the shareholder to receive a proportional
interest in the respective Fund's capital gain distributions and to cast one
vote per share, with fractional shares voting proportionately, on certain Fund
matters, including the election of directors, changes in fundamental policies,
or approval of changes in the Fund's investment advisory agreement.
Corresponding Shares issued in the Reorganizations will be fully paid and
nonassessable and will have no preemptive rights. In the event of the
liquidation of a Fund, shareholders of such Fund are entitled to share pro rata
in the net assets of such Fund available for distribution to shareholders.

The Funds are not required to hold annual meetings and do not intend to do
so except when certain matters, such as a change in a Fund's fundamental
policies, are to be decided. In addition, shareholders representing at least
10% of all eligible votes may call a special meeting if they wish, for the
purpose of voting on the removal of any Fund trustee/director.

Tax Information

The tax consequences associated with an investment in shares of an Acquired
Fund are substantially the same as the tax consequences associated with an
investment in shares of the respective Acquiring Fund. See "Taxes" in the
Acquired Funds Prospectuses and "Dividend, Distribution and Account Policies"
in the Acquiring Funds Prospectus.

Portfolio Transactions

The procedures for engaging in portfolio transactions are generally the same
for the Acquired Funds and the Acquiring Funds. Each of the Funds' advisers,
and Subadvisers, if any, may consider the nature and extent of research
services provided when brokers are selected and may cause a Fund to pay such
broker-dealer's commissions that exceed those that other broker-dealers may
have charged, if in their view the commissions are reasonable in relation to
the value of the brokerage and/or research services provided. For further
discussion of these procedures, see "Portfolio Brokerage" in the Acquired Funds
Statement and "Portfolio Transactions and Brokerage" in the Acquiring Funds
Statement.

Portfolio Turnover

None of the Funds has placed a limit on its portfolio turnover and portfolio
changes are made when the Fund's investment adviser (or Subadviser) believes
they are advisable, usually without reference to the length of time that a
security has been held.

The table below sets forth the portfolio turnover rates for the Acquired
Funds for the fiscal year ended October 31, 2000. Each Acquiring Fund has been
recently created and has not yet commenced operations; consequently, it does
not have portfolio turnover figures. One of these portfolio turnover rates
exceeds 100%. A 100% portfolio turnover rate would occur if all of the
securities in the portfolio were replaced during the period. Higher portfolio
turnover rates increase the brokerage costs a Fund pays and may adversely
affect its performance. Higher portfolio turnover may also result in an
increased proportion of capital gains constituting short-term capital gains
instead of long-term capital gains. If a Fund realizes capital gains when it
sells portfolio investments, it generally must pay those gains out to
shareholders, increasing their taxable distributions. This may adversely affect
the after-tax performance of a Fund for shareholders with taxable accounts.

NAF Science NAF Aggressive NAF Moderate NAF Conservative
NAF Stock Index & Technology Growth LifeStyle Growth LifeStyle Growth LifeStyle
Fund Fund Fund Fund Fund
--------------- ------------ ---------------- ---------------- ----------------

2% 120% 53% 47% 45%

Additional Information

Independent Auditors

Currently PricewaterhouseCoopers LLP serves as the independent auditors of
all of the Acquired Funds and Acquiring Funds. If the Reorganizations are
completed, it is anticipated that PricewaterhouseCoopers LLP will continue to
serve as the independent auditors of the Combined Funds. The principal business
address of PricewaterhouseCoopers LLP is 1177 Avenue of the Americas, New York,
New York 10036.

Custodian

State Street acts as the custodian of the assets of the Acquired Funds and
Acquiring Funds. If the Reorganizations are completed, it is currently
anticipated that State Street will continue to serve as the custodian of the
Combined Funds. The principal business address of State Street is 1776 Heritage
Drive, North Quincy, Massachusetts 02171.

Transfer Agent

Boston Financial Data Services, Inc., 66 Brooks Drive, Braintree,
Massachusetts 02184, serves as the transfer agent with respect to each Acquired
Fund. State Street, 1776 Heritage Drive, North Quincy, Massachusetts 02171,
serves as the transfer agent with respect to each Acquiring Fund. Transfer
agent functions are performed for State Street by National Financial Data
Services, P.O. Box 219572, Kansas City, MO 64121-5972, an affiliate of State
Street. Each transfer agent is responsible for the issuance, transfer and
redemption of shares and the opening, maintenance and servicing of shareholder
accounts for the respective Fund. If the Reorganizations are completed, it is
currently anticipated that State Street will serve as the transfer agent of the
Combined Funds.

Capital Stock

Each Acquired Fund is authorized to issue an unlimited number of full and
fractional shares of beneficial interest, par value $0.001 per share, divided
into four classes designated Class A, Class B, Class C and Institutional Class
I. Each Acquiring Fund is authorized to issue one hundred million (100,000,000)
shares of common stock, par value $0.0001 per share, divided into four classes
designated Class A, Class B, Class II and Class I. See "Shareholder Rights"
above and "Capital Stock" in the Acquired Funds Statement and "Description of
Shares" in the Acquiring Funds Statement for further discussion of the rights
and preferences attributable to shares of each Acquired Fund and each Acquiring
Fund, respectively. See "Summary--Fee Tables" above and "Section II: Fees and
Expenses" (in the case of Class A, Class B and Class C shares) and "Section II:
Fees and Expenses of the North American Funds--Institutional Class I Shares"
(in the case of Institutional Class I shares) in the Acquired Funds
Prospectuses and "Fund Highlights--What are the Fund's Expenses?" in the
Acquiring Funds Prospectus for further discussion on the expenses attributable
to shares of the Acquired Funds and the Acquiring Funds, respectively. See "--
Terms of the Plans--Issuance and Distribution of Corresponding Shares" for a
description of the classes of Corresponding Shares to be issued in the
Reorganizations.

North American Funds is an entity of the type commonly known as a
"Massachusetts business trust." Under Massachusetts law, shareholders of such a
trust may, under certain circumstances, be held personally liable as partners
for its obligations. However, the Declaration of Trust of North American Funds
contains an express disclaimer of shareholder liability for acts or obligations
of each Acquired Fund and provides for indemnification and reimbursement of
expenses out of that Fund's property for any shareholder held personally liable
for the obligations of that Fund. Thus, the risk of a shareholder incurring
financial loss on account of shareholder liability is limited to circumstances
in which the Acquired Funds themselves would be unable to meet their
obligations. Given the above limitations on shareholder personal liability and
the nature of the Acquired Funds' assets and operations, the possibility that
such Fund would be unable to meet its obligations is remote, and each of the
Acquired Funds believes that the risk of a personal liability to shareholders
is also therefore remote. SunAmerica Strategic Investment Series, Inc. is a
corporation organized under Maryland law. In contrast to the laws governing
Massachusetts business trusts as described above, there is no provision under
Maryland law governing corporations providing for shareholder liability for
obligations of a corporation.

Shareholder Inquiries

Shareholder inquiries with respect to the Acquired Funds may be addressed to
each Acquired Fund at 286 Congress Street, Boston, Massachusetts 02210 or by
calling toll free 1-800-872-8037. Shareholder inquiries with respect to the
Acquiring Funds may be addressed to each Acquiring Fund at The SunAmerica
Center, 733 Third Avenue, New York, NY 10017-3204 or by calling toll free 1-
800-858-8850.

THE REORGANIZATIONS

General

Under each Plan, the applicable Acquiring Fund will acquire substantially
all of the assets, and assume substantially all of the liabilities, of the
respective Acquired Fund solely in exchange for an equal aggregate value of
Corresponding Shares of such Acquiring Fund. Upon receipt by an Acquired Fund
of Corresponding Shares, such Acquired Fund will distribute such Corresponding
Shares to its shareholders, as described below. All issued and outstanding
shares of the Acquired Funds will be cancelled, and each Acquired Fund's
existence as a separate investment portfolio of North American Funds will be
terminated as soon as practicable following consummation of the respective
Reorganization.

Generally, the assets transferred by an Acquired Fund to the respective
Acquiring Fund will include all investments of such Acquired Fund held in its
portfolio as of the Valuation Time and all other assets of such Acquired Fund
as of such time.

In the course of each Reorganization, each holder, if any, of Class A, Class
B, Class C and Institutional Class I shares of an Acquired Fund will receive
Class A, Class B, Class II and Class I Corresponding Shares, respectively, of
the applicable Acquiring Fund. No sales charges will be imposed on the
Corresponding Shares issued in connection with the Reorganizations.

Each Acquired Fund will distribute the Corresponding Shares received by it
in connection with its Reorganization pro rata to its shareholders in exchange
for such shareholders' proportional interests in such Acquired Fund. The
Corresponding Shares received by an Acquired Fund's shareholders will have the
same aggregate net asset value as each such shareholder's interest in such
Acquired Fund as of the Valuation Time. See "--Terms of the Plans--Valuation of
Assets and Liabilities" for information concerning the calculation of net asset
value.

Since the Corresponding Shares will be issued at net asset value in exchange
for the net assets of an Acquired Fund having a value equal to the aggregate
net asset value of the shares of such Acquired Fund as of the Valuation Time,
the net asset value per share of the respective Acquiring Fund should remain
virtually unchanged solely as a result of the applicable Reorganization. Thus,
the Reorganizations should not result in dilution of the net asset value of the
Acquired Funds or the Acquiring Funds immediately following consummation of the
Reorganizations. In addition, a shareholder of an Acquired Fund may end up with
a different number of shares compared to what he or she originally held, but
the total dollar value of shares held will remain the same.

If the shareholders of the Acquired Funds approve the Reorganizations at the
Meeting, all required regulatory approvals are obtained, and certain conditions
are either met or waived, it is expected that the Reorganizations will take
place during the fourth calendar quarter of 2001. One Reorganization is not
dependent on the consummation of any other Reorganization. If an Acquired
Fund's shareholders do not approve the respective Reorganization, the NAF Board
will consider other possible courses of action which may be in the best
interests of shareholders.

Terms of the Plans

The following is a summary of the significant terms of the Plans. This
summary is qualified in its entirety by reference to the Plans, a form of which
is attached hereto as Exhibit II.

Valuation of Assets and Liabilities

The respective assets and liabilities of the Acquired Funds and the
Acquiring Funds will be valued as of the Valuation Time. The assets in each
Fund will be valued according to the procedures set forth under

"Transaction Policies--Valuation of Shares" and "Determination of Net Asset
Value" in the Acquiring Funds Prospectus and the Acquiring Funds Statement,
respectively. Purchase orders for an Acquired Fund's shares which have not been
confirmed as of the Valuation Time will be treated as assets of such Acquired
Fund for purposes of the respective Reorganization; redemption requests with
respect to an Acquired Fund's shares which have not settled as of the Valuation
Time will be treated as liabilities of such Acquired Fund for purposes of the
respective Reorganization.

Issuance and Distribution of Corresponding Shares

On the Closing Date (as defined in the Plans), each Acquiring Fund will
issue to the respective Acquired Fund a number of full and fractional
Corresponding Shares the aggregate net asset value of which will equal the
aggregate net asset value of shares of such Acquired Fund as of the Valuation
Time. Such Acquired Fund will then distribute the Corresponding Shares received
by it pro rata to its shareholders of record as of the Valuation Time in
exchange for such shareholders' proportional interests in such Acquired Fund.
Such issuance and distribution will be done as follows: each holder, if any, of
Class A, Class B, Class C and Institutional Class I shares of an Acquired Fund
will receive Class A, Class B, Class II and Class I Corresponding Shares,
respectively, of the applicable Acquiring Fund. The Corresponding Shares
received by an Acquired Fund's shareholder will have the same aggregate net
asset value as such shareholder's interest in such Acquired Fund as of the
Valuation Time.

Expenses

All costs of the Reorganizations will be borne by AIG or an affiliate
thereof, regardless of whether the Reorganizations are consummated. No portion
of the expenses of the Reorganizations will be borne directly or indirectly by
the Funds or their shareholders.

Required Approvals

The completion of each Reorganization is conditioned upon, among other
things, the receipt of certain regulatory approvals, including the receipt of
an order from the Commission pursuant to Section 17(b) of the Investment
Company Act. An application for such order has been filed with the Commission,
however, there is no assurance that it will be received. In addition, the
Declaration of Trust of North American Funds (as amended to date) requires
approval of each Reorganization by the affirmative vote of the respective
Acquired Fund's shareholders representing no less than a majority of the
outstanding voting securities of that Fund, voting together as a single class,
cast at a meeting at which a quorum is present. "Majority" for this purpose
under the Investment Company Act means the lesser of (i) more than 50% of the
outstanding shares of the applicable Acquired Fund and (ii) 67% or more of the
shares of that Acquired Fund represented at the Meeting if more than 50% of
such shares are represented.

Amendments and Conditions

The Plans may be amended at any time prior to the Closing Date with respect
to any of the terms therein. The obligations of each Acquired Fund and
Acquiring Fund pursuant to the respective Plan are subject to various
conditions, including the requisite approval of the respective Reorganization
by such Acquired Fund's shareholders, the receipt of an opinion of counsel as
to tax matters and the confirmation by the respective Acquired Fund and
Acquiring Fund of the continuing accuracy of their respective representations
and warranties contained in such Plan.

Termination, Postponement and Waivers

Each Plan may be terminated, and the respective Reorganization abandoned at
any time, whether before or after adoption thereof by the respective Acquired
Fund's shareholders, prior to the Closing Date or the Closing Date may be
postponed: (i) by mutual agreement of the NAF Board and the SunAmerica Board;
(ii) by an

Acquired Fund if any condition to such Acquired Fund's obligations has not been
fulfilled or waived; or (iii) by an Acquiring Fund if any condition to such
Acquiring Fund's obligations has not been fulfilled or waived.

NAF Board Considerations: Potential Benefits to Shareholders as a Result of the
Reorganizations

In approving the Reorganizations, based upon their evaluation of all
relevant information, and after meeting with counsel to the NAF Independent
Trustees regarding the legal issues involved, the NAF Board considered that,
following each Reorganization, shareholders of an Acquired Fund will remain
invested in a mutual fund which has substantially the same or similar
investment objective and similar, though not identical, investment techniques.
In addition, the NAF Board considered the following, among other things:

. Terms and conditions of the Reorganizations.

. The fact that the Acquiring Funds will assume substantially all the
liabilities of the respective Acquired Funds.

. The gross and net expense ratios of the Acquired Funds before the
Reorganizations and the estimated expense ratios of the Combined Funds on
a pro forma basis after the Reorganizations.

. The relative annual rates of advisory fees payable by the Acquired Funds
and the Combined Funds.

. The fact that the Reorganizations would not result in dilution of
Acquired Fund shareholders' interests.

. That fact that AGAM has agreed to waive fees or reimburse expenses for
the NAF Stock Index Fund and the NAF Science & Technology Fund, but there
is no assurance that the current fee waivers and expense reimbursements
would continue after February 28, 2002.

. The fact that SAAMCo has contractually agreed to waive fees or reimburse
expenses for certain classes of shares of the SunAmerica Stock Index Fund
and SunAmerica Science & Technology Fund.

. The investment experience, expertise and resources of SAAMCo and other
service providers to the Acquiring Funds in the areas of distribution,
investment, and shareholder services.

. The service and distribution resources available to the Acquiring Funds
and compatibility of the Funds' service features available to
shareholders.

. The fact that each Reorganization has been structured with the intention
that it qualify for Federal income tax purposes as a tax-free
reorganization under the Code.

. The fact that AIG or an affiliate thereof will bear all expenses relating
to the Reorganizations.

. The effect of the Reorganizations on Acquired Fund shareholders and the
value of their interests.

. Alternatives available to Acquired Fund shareholders, including the
ability to redeem their shares.

The NAF Board also identified and considered certain potential benefits to
shareholders that are likely to result from the Reorganizations, including
benefits to Acquired Fund Shareholders from becoming shareholders in the
SunAmerica Mutual Funds complex. Because SunAmerica has broad distribution
channels, it is possible that the asset base of each Combined Fund will
increase over the long term, which would tend to result in lower overall
operating expenses. Of course, there is no guarantee that such increases in the
asset base would in fact occur. Another advantage to shareholders identified by
the NAF Board with respect to each of the NAF Growth LifeStyle Funds is the
immediate expected reduction in total combined annual expenses (as a percentage
of net assets) that would be borne by shareholders of these Funds following the
Reorganizations as a result of the relatively lower operating expenses of the
SunAmerica Underlying Funds.

The table below sets forth the total net assets of each of the Acquiring
Funds and each of the Acquired Funds, in each case as of April 30, 2001, as
well as the net assets of each of the Combined Funds, on a pro forma basis,
assuming the Reorganizations had been completed on such date. Each of the
Acquiring Funds is newly created and has not yet commenced operations.
Accordingly, each of the Acquiring Funds had no assets as of such date.

Total Net Assets
as of April 30, 2001

NAF Stock Index Fund SunAmerica Stock Index Pro Forma Stock Index
Class Fund Combined Fund
A $ 8,374,116 Class A N/A Class
Class Class B N/A A $ 8,374,116
B $24,812,313 Class II N/A Class
Class Class I N/A B $24,812,313
C $ 1,269,806 Total N/A Class
Institutional II $ 1,269,806
Class Class
I $ 0 I $ 0
Total$34,456,235 Total$34,456,235

NAF Science & Technology Fund
SunAmerica Science & Pro Forma Science &
Class Technology Fund Technology Combined Fund
A $ 3,887,416 Class A N/A Class
Class Class B N/A A $ 3,887,416
B $13,463,381 Class II N/A Class
Class Class I N/A B $13,463,381
C $ 1,336,929 Total N/A Class
Institutional II $ 1,336,929
Class I Class
$ 332,897 I $ 332,897
Total$19,020,623 Total$19,020,623

NAF Aggressive Growth LifeStyle Fund

Pro Forma Aggressive
Class SunAmerica Aggressive Growth LifeStage
A $ 3,720,436 Growth LifeStage Fund Combined Fund

Class A N/A
Class Class B N/A Class
B $14,011,636 Class II N/A A $ 3,720,436
Class Class I N/A Class
C $ 181,147 Total N/A B $14,011,636
Institutional Class
Class I II $ 181,147
$ 5,322,847 Class
Total$23,236,066 I $ 5,322,847

NAF Moderate Growth LifeStyle Fund Total$23,236,066
SunAmerica Moderate Growth
LifeStage Fund Pro Forma Moderate
Class Growth LifeStage
A $ 4,208,417 Class A N/A Combined Fund
Class Class B N/A Class
B $13,585,890 Class II N/A A $ 4,208,417
Class Class I N/A Class
C $ 599,878 Total N/A B $13,585,890
Institutional Class
Class I II $ 599,878
$ 7,553,467 Class
Total$25,947,652 I $ 7,553,467

NAF Conservative Growth LifeStyle Fund Total$25,947,652
SunAmerica Conservative
Growth LifeStage Fund Pro Forma Conservative
Class Growth LifeStage
A $ 3,364,276 Class A N/A Combined Fund
Class Class B N/A Class
B $10,098,087 Class II N/A A $ 3,364,276
Class Class I N/A Class
C $ 536,973 Total N/A B $10,098,087
Institutional Class
Class I II $ 536,973
$ 5,112,079 Class
Total$19,111,415 I $ 5,112,079
Total$19,111,415

The NAF Board also considered the fees and expenses applicable to the
Acquiring Funds and the Acquired Funds, especially the fact that the fees and
net expenses (total combined annual expenses, in the case of the Growth
LifeStage Funds) applicable to Acquired Fund shareholders will not increase
after the Reorganizations. This is because the fees and net expenses (total
combined annual expenses, in the case of the Growth LifeStage Funds) of each
Combined Fund are generally expected to be the same as those of the
corresponding Acquired Fund, with the exception of the Growth LifeStage
Combined Funds for which total combined annual expenses are expected to be
lower than those of the corresponding Acquired Funds. To illustrate this, see
the total and net operating expenses (total combined annual expenses, in the
case of the Growth LifeStage Funds), as a percentage of net assets, for the
Acquired Funds and the Acquiring Funds as of April 30, 2001, and the total and
net operating expenses (total combined annual expenses, in the case of the
Growth LifeStage Funds), as a percentage of net assets, for the Combined Funds,
on a pro forma basis, assuming the Reorganizations had been completed as of
such date, under "Fee Tables" above. In addition, because SunAmerica has broad
distribution channels, it is also possible that the asset base for the Combined
Funds will increase over the long term, which would tend to result in a lower
overall operating expense ratio. Of course, there is no guarantee that such
increases in asset base would in fact occur.

In addition to the potential economies of scale which may be realized
through combination of the Funds, the NAF Board also considered the advantage
of eliminating the competition and duplication of effort inherent in marketing
funds that have similar investment objectives.

AGAM is contractually obligated to provide the fee reductions and expense
reimbursements referenced in the "Fee Tables" above through February 28, 2002.
If shareholders do not approve the Reorganizations, each Acquired Fund will
continue with its current fee structure except that there is no assurance that
AGAM would continue to provide such fee reductions and reimbursements to the
NAF Stock Index Fund and NAF Science & Technology Fund past this date. If
shareholders approve the Reorganizations, the respective Combined Funds'
expense structure will apply. It should be noted that the Combined Fund expense
waivers and fee reimbursements will continue indefinitely subject to
termination by the SunAmerica Board, including a majority of the SunAmerica
Independent Directors. SunAmerica may not increase such ratios, which are
contractually required by agreement with the SunAmerica Board, without the
approval of the SunAmerica Board, including a majority of the SunAmerica
Independent Directors.

Based on the foregoing, together with other factors and information
considered to be relevant and recognizing that there can be no assurance that
any operating efficiencies or other benefits will in fact be realized, the NAF
Board concluded that the Reorganizations present no significant risks or costs
(including legal, accounting and administrative costs) that would outweigh the
benefits discussed above. In connection with the approval of the
Reorganizations, the NAF Board also approved directed brokerage arrangements
with certain brokers to reduce the costs that might otherwise be incurred to
align the portfolio of each of the Acquired Funds with those of the respective
Acquiring Fund to facilitate a smooth transition upon consummation of the
Reorganizations. Because the Acquired Funds and the Acquiring Funds have
substantially the same or similar investment objectives and similar investment
strategies, it is not anticipated that the securities held by an Acquired Fund
will be sold in significant amounts in order to comply with the objectives and
investment policies of the respective Acquiring Fund in connection with the
applicable Reorganization. The Acquired Funds will not dispose of assets to an
extent or in a manner that would jeopardize the tax-free nature of the
Reorganizations under the Code. However, the disposition of assets by an
Acquired Fund may result in the realization of taxable gains or losses by
Acquired Fund shareholders.

In approving the Reorganizations, the NAF Board, including all of the NAF
Independent Trustees, determined that each Reorganization is in the best
interests of the respective Acquired Fund and its shareholders. In addition,
the NAF Board, including all of the NAF Independent Trustees, also determined
that the interests of the shareholders of each Acquired Fund would not be
diluted as a result of effecting the respective Reorganization because each
such shareholder will receive Corresponding Shares of the Acquiring Fund having
an aggregate net asset value equal to the aggregate net asset value of his or
her shares of the

Acquired Fund outstanding as of the Valuation Time. Consequently, the NAF Board
approved the Plans and directed that each Plan be submitted to the shareholders
of each respective Acquired Fund for approval.

The Board of Trustees of North American Funds unanimously recommends that
the shareholders of each Acquired Fund approve the respective Plan. Approval of
the respective Plan by one Acquired Fund is not contingent upon the approval of
the respective Plan by any other Acquired Fund.

The SunAmerica Board has also approved the Plans on behalf of the Acquiring
Funds.

Federal Income Tax Consequences of the Reorganizations

General

Each Reorganization has been structured with the intention that it qualify
for Federal income tax purposes as a tax-free reorganization under Section
368(a) of the Code. This means that, in the opinion of counsel, no gain or loss
will be recognized by a shareholder of an Acquired Fund for Federal income tax
purposes as a result of a Reorganization.

As a condition to the closing of each Reorganization, each of the Acquired
Funds and Acquiring Funds will receive an opinion of Shearman & Sterling,
counsel to the Acquiring Funds, substantially to the effect that, among other
things, for Federal income tax purposes, upon consummation of each
Reorganization (i) no gain or loss will be recognized by an Acquired Fund or an
Acquiring Fund as a result of its respective Reorganization, (ii) no gain or
loss will be recognized by a shareholder of an Acquired Fund upon his or her
receipt of Corresponding Shares in the respective Reorganization solely in
exchange for his or her shares of such Acquired Fund, (iii) each Acquired Fund
and Acquiring Fund will be a "party to a reorganization" under Section 368(b)
of the Code, (iv) the holding period of the assets of an Acquired Fund acquired
by the respective Acquiring Fund will include the period during which such
assets were held by the Acquired Fund, (v) the holding period for Corresponding
Shares of an Acquiring Fund received by each shareholder of the respective
Acquired Fund in exchange for his or her shares in the Acquired Fund will
include the period during which such shareholder held shares of the Acquired
Fund (provided the Acquired Fund shares were held as capital assets on the date
of the exchange), and (vi) immediately after a Reorganization, the tax basis of
the Corresponding Shares received by shareholders of the respective Acquired
Fund in such Reorganization will be equal, in the aggregate, to the tax basis
of the shares of such Acquired Fund surrendered in exchange therefor. Shearman
& Sterling's opinion will be based upon certain representations made by the
parties to the Reorganizations.

An opinion of counsel does not have the effect of a private letter ruling
from the Internal Revenue Service ("IRS") and is not binding on the IRS or any
court. If a Reorganization is consummated but fails to qualify as a
reorganization within the meaning of Section 368 of the Code, the
Reorganization would be treated as a taxable sale of assets followed by a
taxable liquidation of the respective Acquired Fund, and the Acquired Fund
shareholders would recognize a taxable gain or loss equal to the difference
between their basis in the Acquired Fund shares and the fair market value of
the Corresponding Shares received.

Shareholders should consult their tax advisers regarding the effect of the
Reorganizations in light of their individual circumstances. As the foregoing
relates only to Federal income tax consequences, shareholders also should
consult their tax advisers as to the non-United States, state, local and other
tax consequences of the Reorganizations.

Status as a Regulated Investment Company

The Acquired Funds have elected and qualified, and each Acquiring Fund
intends to elect and to qualify, to be taxed as regulated investment companies
under Sections 851-855 of the Code, and after the Reorganizations, the
Acquiring Funds intend to continue to qualify as regulated investment
companies. An Acquired Fund's existence as a separate investment portfolio of
North American Funds will be terminated as soon as practicable following the
consummation of the applicable Reorganization.

Capitalization

The following table sets forth the capitalization of each Acquired Fund and
each Acquiring Fund as of April 30, 2001, and the capitalization of each
Combined Fund, on a pro forma basis, as if the Reorganizations had occurred on
that date. As a newly created portfolio of SunAmerica Strategic Investment
Series, Inc., each Acquiring Fund had no assets as of such date.

SunAmerica Stock
NAF Stock Index Fund Index Fund*
----------------------------------------------- -----------------------
Institutional Class Class Class Class
Class A Class B Class C Class I** A B II I
---------- ----------- ---------- ------------- ----- ----- ----- -----

Total Net
Assets.......... $8,374,116 $24,812,213 $1,269,806 $ 0 N/A N/A N/A N/A
Shares
Outstanding..... 758,061 2,254,865 116,080 0 N/A N/A N/A N/A
Net Asset Value
Per Share....... $ 11.05 $ 11.00 $ 10.94 $ 0 N/A N/A N/A N/A

Pro Forma Stock Index Combined Fund
--------------------------------------------
Class A Class B Class II Class I
---------- ----------- ---------- ----------

Total Net
Assets.......... $8,374,116 $24,812,313 $1,269,806 $ 0
Shares
Outstanding..... 758,061 2,254,865 116,080 $ 0
Net Asset Value
Per Share....... $ 11.05 $ 11.00 $ 10.94 $ 0

SunAmerica Science &
NAF Science & Technology Fund Technology Fund*
----------------------------------------------- -----------------------
Institutional Class Class Class Class
Class A Class B Class C Class I A B II I
---------- ----------- ---------- ------------- ----- ----- ----- -----

Total Net
Assets.......... $3,887,416 $13,463,381 $1,336,929 $ 332,897 N/A N/A N/A N/A
Shares
Outstanding..... 779,767 2,726,669 277,392 66,676 N/A N/A N/A N/A
Net Asset Value
Per Share....... $ 4.99 $ 4.94 $ 4.82 $ 4.99 N/A N/A N/A N/A

Pro Forma Science & Technology Combined Fund
--------------------------------------------
Class A Class B Class II Class I
---------- ----------- ---------- ----------

Total Net
Assets.......... $3,887,416 $13,463,381 $1,336,929 $ 332,897
Shares
Outstanding..... 779,767 2,726,669 277,392 66,676
Net Asset Value
Per Share....... $ 4.99 $ 4.94 $ 4.82 $ 4.99

SunAmerica Aggressive
NAF Aggressive Growth LifeStyle Fund Growth LifeStage Fund*
----------------------------------------------- -----------------------
Institutional Class Class Class Class
Class A Class B Class C Class I A B II I
---------- ----------- ---------- ------------- ----- ----- ----- -----

Total Net
Assets.......... $3,720,436 $14,011,636 $ 181,147 $5,322,847 N/A N/A N/A N/A
Shares
Outstanding..... 408,408 1,535,560 19,700 583,083 N/A N/A N/A N/A
Net Asset Value
Per Share....... $ 9.11 $ 9.12 $ 9.20 $ 9.13 N/A N/A N/A N/A

Pro Forma Aggressive Growth
LifeStage Combined Fund
--------------------------------------------
Class A Class B Class II Class I
---------- ----------- ---------- ----------

Total Net
Assets.......... $3,720,436 $14,011,636 $ 181,147 $5,322,847
Shares
Outstanding..... 408,408 1,535,560 19,700 583,083
Net Asset Value
Per Share....... $ 9.11 $ 9.12 $ 9.20 $ 9.13

SunAmerica Moderate
NAF Moderate Growth LifeStyle Fund Growth LifeStage Fund*
----------------------------------------------- -----------------------
Institutional Class Class Class Class
Class A Class B Class C Class I A B II I
---------- ----------- ---------- ------------- ----- ----- ----- -----

Total Net
Assets.......... $4,208,417 $13,585,890 $ 599,878 $7,553,467 N/A N/A N/A N/A
Shares
Outstanding..... 433,247 1,395,980 61,564 778,229 N/A N/A N/A N/A
Net Asset Value
Per Share....... $ 9.71 $ 9.73 $ 9.74 $ 9.71 N/A N/A N/A N/A

Pro Forma Moderate Growth
LifeStage Combined Fund
--------------------------------------------
Class A Class B Class II Class I
---------- ----------- ---------- ----------

Total Net
Assets.......... $4,208,417 $13,585,890 $ 599,878 $7,553,467
Shares
Outstanding..... 433,247 1,395,980 61,564 778,228
Net Asset Value
Per Share....... $ 9.71 $ 9.73 $ 9.74 $ 9.71

NAF Conservative Growth SunAmerica Conservative
LifeStyle Fund Growth LifeStage Fund*
----------------------------------------------- -----------------------
Institutional Class Class Class Class
Class A Class B Class C Class I A B II I
---------- ----------- ---------- ------------- ----- ----- ----- -----

Total Net
Assets.......... $3,364,276 $10,098,087 $ 536,973 $5,112,079 N/A N/A N/A N/A
Shares
Outstanding..... 343,639 1,026,961 54,503 521,695 N/A N/A N/A N/A
Net Asset Value
Per Share....... $ 9.79 $ 9.83 $ 9.85 $ 9.80 N/A N/A N/A N/A

Pro Forma Conservative Growth
LifeStage Combined Fund
--------------------------------------------
Class A Class B Class II Class I
---------- ----------- ---------- ----------

Total Net
Assets.......... $3,364,276 $10,098,087 $ 536,973 $5,112,079
Shares
Outstanding..... 343,639 1,026,961 54,503 521,695
Net Asset Value
Per Share....... $ 9.79 $ 9.83 $ 9.85 $ 9.80

----
* The Acquiring Funds were not operating at April 30, 2001.

** No Institutional Class I information is shown for the NAF Stock Index
Fund, because no Institutional Class I shares are currently outstanding
for this Fund.

The table set forth above should not be relied upon to reflect the number of
shares to be received in the Reorganizations; the actual number of shares to
be received will depend upon the net asset value and number of shares
outstanding of each Fund at the Valuation Time.

GENERAL

INFORMATION CONCERNING THE MEETING

Date, Time and Place of Meeting

The Meeting will be held on November 7, 2001, at the principal executive
offices of North American Funds, 286 Congress Street, Boston, Massachusetts
02210, at 10:00 a.m., Eastern Time.

Solicitation, Revocation and Use of Proxies

A shareholder executing and returning a proxy has the power to revoke it at
any time prior to its exercise by executing a superseding proxy (i.e., later-
dated and signed), by submitting a notice of revocation to the Secretary of
North American Funds or by subsequently registering his or her vote by
telephone or via the Internet. In addition, although mere attendance at the
Meeting will not revoke a proxy, a shareholder present at the Meeting may
withdraw his or her proxy and vote in person.

All shares represented by properly executed proxies received at or prior to
the Meeting, unless such proxies previously have been revoked, will be voted at
the Meeting in accordance with the directions on the proxies; if no direction
is indicated on a properly executed proxy, such shares will be voted "FOR"
approval of the New Investment Advisory Agreement, the New Subadvisory
Agreement (if applicable) and the respective Plan.

It is not anticipated that any matters other than the approval of the New
Agreements and approval of the respective Plan will be brought before the
Meeting. If, however, any other business properly is brought before the
Meeting, proxies will be voted in accordance with the judgment of the persons
designated on such proxies.

Record Date and Outstanding Shares

Only holders of record of shares of the Acquired Funds at the close of
business on September 17, 2001 (the "Record Date") are entitled to vote at the
Meeting or any adjournment thereof. The following chart sets forth the shares
of each class of the Acquired Funds issued and outstanding and entitled to vote
at the close of business on the Record Date.

Class A Class C Institutional
Shares Class B Shares Shares Class I Shares Total Shares
------------ -------------- ------------ -------------- -------------

NAF Stock Index Fund.... 778,685.5840 2,300,794.0960 161,239.1980 * 3,240,718.878
NAF Science & Technology
Fund................... 840,421.7480 2,920,431.8510 301,700.2510 188,016.3800 4,250,570.23
NAF Aggressive Growth
LifeStyle Fund......... 441,325.7930 1,604,250.2290 25,417.1820 662,162.3650 2,733,155.569
NAF Moderate Growth
LifeStyle Fund......... 448,256.4350 1,533,948.4750 78,867.4020 936,911.9840 2,997,984.296
NAF Conservative Growth
LifeStyle Fund......... 378,755.7150 1,058,299.3050 67,991.8390 565,739.0350 2,070,785.894

--------

* No Class I information is shown for the NAF Stock Index Fund, because no
Class I shares are currently outstanding for this Fund.

Security Ownership of Certain Beneficial Owners and Management of the Funds

To the knowledge of each Fund, as of August 31, 2001, the following
shareholders, if any, owned beneficially or of record more than 5% of the
outstanding voting securities of such Fund:

Percentage of
Class of Shares of
Combined Fund
Percentage of After the
Class of Shares and Reorganization on
Name of Fund Name and Address of Shareholder Type of Ownership a Pro Forma Basis*
------------ ------------------------------- ------------------- ------------------

NAF Stock Index Fund.... VALIC Seed Account 26.60% of Class A, 26.60% of Class A
Attn: Greg Kingston owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

SSBT FBO IRA 12.91% of Class A, 12.91% of Class A
R/O Mary Ann Boettger beneficially owned
505 Harold Street
Bay City, MI, 48708-
7560

Arlen J Deyoung & 14.92% of Class C, 14.92% of Class II
Eileen G Deyoung owned of record
JT Ten
8656 Vinup Road
Lynden, WA 98264-9332

SSBT Cust. for the 5.90% of Class C, 5.90% of Class II
IRA beneficially owned
R/O Joan B Terry
1602 Northwind Court
Winter Springs, FL
32708-3879

SSBT 5.10% of Class C, 5.10% of Class II
Cust. for the IRA beneficially owned
R/O Isreal Grinberg
5315 Rutherglenn
Drive
Houston, TX 77096-
4139

NAF Science & Technology SSBT 7.12% of Class C, 7.12% of Class II
Fund................... Cust. for the IRA beneficially owned
R/O Isreal Grinberg
5315 Rutherglenn
Drive
Houston, TX 77096-
4139

NFSC FEBO #0AG-002917 5.10% of Class C, 5.10% of Class II
Wesley McClain & beneficially owned
Sheri McClain
1090 Maple Ridge
Court
Evans, GA 30809-5248

INVESCO TTEE FBO AG 53.54% of 53.54% of Class I
Employees Thrift & Institutional Class I,
Incentive Plan beneficially owned
#001248
PO Box 4054
Concord, CA 94524-
4054

VALIC Seed Account 46.45% of Institutional 46.45% of Class I
Attn: Greg Kingston Class I, owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

NAF Aggressive Growth
LifeStyle Fund......... VALIC Seed Account 36.19% of Class A, 36.19% of Class A
Attn: Greg Kingston owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

SSBT Cust. IRA 5.45% of Class A, 5.45% of Class A
A/C Alyson Hardin beneficially owned
511 Banyan Road
Starkville, MA 39759-
4348

VALIC Seed Account 8.61% of Class B, 8.61% of Class B
Attn: Greg Kingston owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

SSBT Cust. for the 11.31% of Class C, 11.31% of Class II
IRA beneficially owned
of Judith Trimble
205 Wayside Drive
Turlock, CA 95380-
3219

SSBT Cust. for the 9.24% of Class C, 9.24% of Class II
IRA beneficially owned
R/O of Richard Brown
160 Ogunquit Road
South Berwick, ME
03908-2140

SSBT Cust. for the 8.72% of Class C, 8.72% of Class II
IRA beneficially owned
R/O Hugh Wilson
455 Piney Point Drive
Sour Lake, TX 77659-
9246

VALIC Seed Account 49.34% of Institutional 49.34% of Class I
Attn: Greg Kingston Class I, owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

VALIC Trust Co. 5.54% of Institutional 5.54% of Class I
ad Cust. FBO Class I, beneficially owned
City of Shreveport
Attn: Kathleen Janos
2929 Allen Parkway
#L3-00
Houston, TX 77019-
7100

NAF Moderate Growth
LifeStyle Fund......... VALIC Seed Account 33.13% of Class A, 33.13% of Class A
Attn: Greg Kingston owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

SSBT IRA 7.07% of Class A, 7.07% of Class A
R/O Michael Flynn beneficially owned
6006 Wayne Avenue
Pentwater, MI 49449-
9514

VALIC Seed Account 8.52% of Class B, 8.52% of Class B
Attn: Greg Kingston owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

SSBT Cust. for the 19.62% of Class C, 19.62% of Class II
URA beneficially owned
R/O of Joseph
Clumpner
1006 Northbridge Lane
Chattanooga, TN
37405-4214

Cathy H. Cutchins 10.11% of Class C, 10.11% of Class II
202 Harkness Road owned of record
Amherst, MA 01002-
9775

VALIC Seed Account 32.51% of Institutional 32.51% of Class I
Attn: Greg Kingston Class I, owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

VALIC Trust as Cust. 17.56% of Institutional 17.56% of Class I
FBO Vista Health Class I, beneficially owned
Retirement Savings
Plan
Attn: Kathleen Janos
2929 Allen Parkway
#L3-00
Houston, TX 77019-
7100

VALIC Trust as Cust. 6.96% of Institutional 6.96% of Class I
FBO Denver Water Class I, beneficially owned
Board Suppl Ret Avg
Pl.
Attn: Kathleen Janos
2929 Allen Parkway
#L3-00,
Houston, TX 77019-
7100

VALIC Trust Co. 6.20% of Institutional 6.20% of Class I
ad Cust. FBO Class I, beneficially owned
City of Shreveport
Attn: Kathleen Janos
2929 Allen Parkway
#L3-00
Houston, TX 77019-
7100

NAF Conservative Growth
LifeStyle Fund......... VALIC Seed Account 38.80% of Class A, 38.80% of Class A
Attn: Greg Kingston owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

Katherine A Kirby TOD 7.70% of Class A, 7.70% of Class A
as per will, owned of record
302 E 8th Street
El Paso, IL 61738-
1281

VALIC Seed Account 12.16% of Class B, 12.16% of Class B
Attn: Greg Kingston owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

Cathy H. Cutchins 11.62% of Class C, 11.62% of Class II
202 Harkness Road owned of record
Amherst, MA 01002-
9775

SSBT Cust. For the 8.54% of Class C, 8.54% of Class II
IRA beneficially owned
R/O Barbara Laska
Barbara H Laska
410 Lexington Riddle
Village
Media, PA 19063-6022

SSBT Cust. for the 7.94% of Class C, 7.94% of Class II
IRA beneficially owned
R/O Yuly Vega
1803 Edmondson Avenue
Catonsville, MD
21228-4350

Carol Fosco 6.36% of Class C, 6.36% of Class II
1562 Fitchville owned of record
Avenue
San Jose, CA 95126-
4218

NFSC FEBO # 0AG- 5.65% of Class C, 5.65% of Class II
021199 beneficially owned
Charles Kasal & Grace
Kasal
900 N Johnson
Turlock, CA 95380-
3514

Percentage of
Class of Shares of
Percentage of Combined Fund After
Class of Shares and the Reorganization on
Name of Fund Name and Address of Shareholder Type of Ownership a Pro Forma Basis*
------------ ------------------------------- ------------------- ---------------------

SSBT Cust. for the 5.53% of Class C, 5.53% of Class II
IRA of Richard beneficially owned
Keethers
1726 Woodcrest Drive
Saint Anne, IL 60964-
4493

Betty Roach 5.28% of Class C, 5.28% of Class II
1309 Vernal Drive owned of record
San Jose, CA 95130-
1262

VALIC Seed Account 52.90% of Institutional 52.90% of Class I
Attn: Greg Kingston Class I, owned of record
2919 Allen Parkway
#L7-01
Houston, TX 77019-
2142

VALIC Trust Co. ad 11.54% of Institutional 11.54% of Class I
Cust. FBO City of Class I, beneficially owned
Shreveport Attn:
Kathleen Janos
2929 Allen Parkway
#L3-00
Houston, TX 77019-
7100

VALIC Trust Co. ad 11.00% of Institutional 11.00% of Class I
Cust. FBO City of Class I, beneficially owned
Shreveport Attn:
Kathleen Janos
2929 Allen Parkway
#L3-00
Houston, TX 77019-
7100

VALIC Trust as Cust. 5.28% of Institutional 5.28% of Class I
FBO RC Def. Comp. Class I, beneficially owned
Plan
Attn: Kathleen Janos
2929 Allen Parkway
#L3-00
Houston, TX 77019-
7100

--------
* Assuming that the value of the shareholder's interest in the Fund on the
date of consummation of the applicable Reorganization was the same as on
August 31, 2001.

In addition, each of the Acquiring Funds is newly created and will initially
be wholly owned by SAAMCo as the initial seed investor.

At August 31, 2001, the directors and officers of North American Funds as a
group (13 persons) owned an aggregate of less than 1% of the outstanding shares
of each Acquired Fund and owned an aggregate of less than 1% of the outstanding
shares of common stock of North American Funds.

At August 31, 2001, the directors and officers of SunAmerica Strategic
Investment Series, Inc. as a group (8 persons) owned an aggregate of less than
1% of the outstanding shares of each Acquiring Fund and owned an aggregate of
less than 1% of the outstanding shares of common stock of SunAmerica Strategic
Investment Series, Inc.

Voting Rights and Required Vote

Each share of an Acquired Fund is entitled to one vote with fractional
shares voting proportionally. Shareholders of each Acquired Fund vote
separately on whether to approve the New Investment Advisory Agreement and
approval with respect to one Acquired Fund is not dependent on approval with
respect to any other Acquired Fund. Shareholders of each applicable Acquired
Fund also vote separately on whether to approve the New Subadvisory Agreement,
and approval with respect to one Acquired Fund is not dependent on approval
with respect to any other Acquired Fund. Approval of the Plan with respect to
one Acquired Fund is not dependent on approval of the Plan with respect to any
other Acquired Fund. Approval of the New Agreements and each Plan with respect
to an Acquired Fund requires the affirmative vote of a majority of the
outstanding voting securities of that Fund, voting together as a single class,
cast at a meeting at which a quorum is present. "Majority" for this purpose
under the Investment Company Act means the lesser of (i) more than 50% of the
outstanding shares of the applicable Acquired Fund and (ii) 67% or more of the
shares of that Acquired Fund represented at the Meeting if more than 50% of
such shares are represented.

Broker/dealer firms holding shares of any of the Acquired Funds in "street
name" for the benefit of their customers and clients will request the
instructions of such customers and clients on how to vote their shares before
the Meeting. Broker/dealer firms will not be permitted to grant voting
authority without instructions with respect to the approval of the Plans. Each
of the Acquired Funds will include shares held of record by broker/dealers as
to which such authority has been granted in its tabulation of the total number
of shares present for purposes of determining whether the necessary quorum of
shareholders exists. Properly executed proxies that are returned but that are
marked "abstain" or with respect to which a broker-dealer has declined to vote
on any proposal ("broker nonvotes") will be counted as present for the purposes
of determining a quorum. Assuming the presence of a quorum, abstentions and
broker nonvotes (if applicable) will have the same effect as a vote against
approval of the New Investment Advisory Agreement, New Subadvisory Agreement or
the applicable Plan, as the case may be.

A quorum for each Acquired Fund for purposes of the Meeting consists of
thirty percent of the shares of such Acquired Fund entitled to vote at the
Meeting, present in person or by proxy. If, by the time scheduled for each
Meeting, a quorum of the applicable Acquired Fund's shareholders is not present
or if a quorum is present but sufficient votes in favor of approval of the New
Agreements or of the applicable Plan are not received from the shareholders of
the applicable respective Acquired Fund, the persons named as proxies may
propose one or more adjournments of such Meeting to permit further solicitation
of proxies from shareholders. An affirmative vote of less than thirty percent
of the shares of the applicable Acquired Fund present in person or by proxy and
entitled to vote at the session of the Meeting will suffice for any such
adjournment. The persons named as proxies will vote in favor of any such
adjournment if they determine that adjournment and additional solicitation are
reasonable and in the interests of the shareholders of such Acquired Fund.

The votes of shareholders of the Acquiring Funds are not being solicited by
this Proxy Statement and Prospectus and are not required to carry out the
respective Reorganizations.

ADDITIONAL INFORMATION

The expenses of preparation, printing and mailing of the enclosed form of
proxy, the accompanying Notice and this Proxy Statement and Prospectus will be
borne by AIG or an affiliate thereof. Such expenses are currently estimated to
be approximately $250,000 in the aggregate.

AIG or an affiliate thereof will reimburse banks, brokers and others for
their reasonable expenses in forwarding proxy solicitation materials to
beneficial owners of the Acquired Funds and will reimburse certain officers or
employees that it may employ for their reasonable expenses in assisting in the
solicitation of proxies from such beneficial owners.

In order to obtain the necessary quorums at the Meetings, supplementary
solicitation may be made by mail, telephone, telegraph or personal interview by
officers of the Acquired Funds. North American Funds has retained Georgeson
Shareholder, 17 State Street, New York, New York 10004 to aid in the
solicitation of

proxies at a cost estimated not to exceed $4,000, plus out-of-pocket expenses.
The cost of soliciting proxies will be borne by AIG or an affiliate thereof.

This Proxy Statement and Prospectus does not contain all of the information
set forth in the registration statements and the exhibits relating thereto
which North American Funds and SunAmerica Strategic Investment Series, Inc.
have filed on behalf of their respective Funds with the Commission under the
Securities Act and the Investment Company Act, to which reference is hereby
made.

The Funds are subject to the informational requirements of the Securities
Exchange Act of 1934, as amended, and the Investment Company Act, and in
accordance therewith file reports and other information with the Commission.
Proxy material, reports and other information filed by the Funds (or by North
American Funds on behalf of the Acquired Funds or SunAmerica Strategic
Investment Series, Inc. on behalf of the Acquiring Funds) can be inspected and
copied at the public reference facilities maintained by the Commission at 450
Fifth Street, N.W., Washington, D.C. 20549. Copies of such materials also can
be obtained by mail from the Public Reference Branch, Office of Consumer
Affairs and Information Services, Securities and Exchange Commission,
Washington, D.C. 20549, at prescribed rates. The Commission maintains a web
site (http://www.sec.gov) that contains the Statements of Additional
Information and Prospectuses of the Acquired Funds and Acquiring Funds, as well
as other material incorporated by reference and other information regarding the
Funds.

LEGAL PROCEEDINGS

There are no material legal proceedings to which any of the Funds is a
party.

LEGAL OPINIONS

Certain legal matters in connection with the issuance of Corresponding
Shares have been passed upon by Robert M. Zakem, Esq., General Counsel for
SAAMCo. Certain tax matters in connection with the Reorganizations will be
passed upon for the Funds by Shearman & Sterling, 599 Lexington Avenue, New
York, New York 10022, counsel for the Acquiring Funds.

EXPERTS

The financial highlights of the Acquired Funds incorporated by reference
into this Proxy Statement and Prospectus have been so included in reliance on
the reports of PricewaterhouseCoopers LLP, independent auditors, given on their
authority as experts in auditing and accounting. The principal business address
of PricewaterhouseCoopers LLP is 1177 Avenue of the Americas, New York, New
York 10036.

SHAREHOLDER PROPOSALS

A shareholder proposal intended to be presented at any subsequent meeting of
shareholders of an Acquired Fund must be received by such Acquired Fund in a
reasonable time before the solicitation by the Board of Trustees of North
American Funds relating to such meeting is to be made in order to be considered
in such Acquired Fund's proxy statement and form of proxy relating to the
meeting. If proposal Nos. 2(a)-(e) are approved at the Meeting, there will
likely not be any future shareholders meetings of the Acquired Funds.

By Order of the Board of Trustees of
North American Funds

/s/ John I. Fitzgerald
John I. Fitzgerald
Secretary, North American Funds

EXHIBIT IA

INVESTMENT ADVISORY AGREEMENT

INVESTMENT ADVISORY AGREEMENT made as of this day of , 2001,
between NORTH AMERICAN FUNDS, a Massachusetts business trust (the "Trust"), and
AMERICAN GENERAL ASSET MANAGEMENT CORP., a Delaware corporation (the
"Adviser"). In consideration of the mutual covenants contained herein, the
parties agree as follows:

1. APPOINTMENT OF ADVISER

The Trust hereby appoints the Adviser, subject to the supervision of the
Trustees of the Trust and the terms of this Agreement, as the investment
adviser for each of the portfolios of the Trust specified in Appendix A to this
Agreement (the "Funds"). The Adviser accepts such appointment and agrees to
render the services and to assume the obligations set forth in this Agreement
commencing on its effective date. The Adviser will be an independent contractor
and will have no authority to act for or represent the Trust in any way or
otherwise be deemed an agent unless expressly authorized in this Agreement or
another writing by the Trust and Adviser.

2. DUTIES OF THE ADVISER

a. Subject to the general supervision of the Trustees of the Trust and
the terms of this Agreement, the Adviser will at its own expense select,
contract with, and compensate investment subadvisers ("Subadvisers") to
manage the investments and determine the composition of the assets of the
Funds; provided, that any contract with a Subadviser (the "Subadvisory
Agreement") shall be in compliance with and approved as required by the
Investment Company Act of 1940, as amended ("Investment Company Act").
Subject always to the direction and control of the Trustees of the Trust,
the Adviser will monitor compliance of each Subadviser with the investment
objectives and related investment policies, as set forth in the Trust's
registration statement as filed with the Securities and Exchange
Commission, of any Fund or Funds under the management of such Subadviser,
and review and report to the Trustees of the Trust on the performance of
such Subadviser.

b. The Adviser will oversee the administration of all aspects of the
Trust's business and affairs and in that connection will furnish to the
Trust the following services:

(1) Office and Other Facilities. The Adviser shall furnish to the Trust
office space in the offices of the Adviser or in such other place as may be
agreed upon by the parties hereto from time to time and such other office
facilities, utilities and office equipment as are necessary for the Trust's
operations.

(2) Trustees and Officers. The Adviser agrees to permit individuals who
are directors, officers or employees of the Adviser to serve (if duly
elected or appointed) as Trustees or President, Vice President, Treasurer
or Secretary of the Trust, without remuneration from or other cost to the
Trust.

(3) Other Personnel. The Adviser shall furnish to the Trust, at the
Trust's expense, any other personnel necessary for the operations of the
Trust.

(4) Financial, Accounting, and Administrative Services. The Adviser
shall maintain the existence and records of the Trust; maintain the
registrations and qualifications of Trust shares under federal and state
law; and perform all administrative, financial, accounting, bookkeeping and
recordkeeping functions of the Trust except for any such functions that may
be performed by a third party pursuant to a custodian, transfer agency or
service agreement executed by the Trust. The Trust shall reimburse the
Adviser for its expenses associated with all such services, including the
compensation and related personnel expenses and expenses of office space,
office equipment, utilities and miscellaneous office expenses, except any
such expenses directly attributable to officers or employees of the Adviser
who are serving as President, Vice President, Treasurer or Secretary of the
Trust. The Adviser shall determine the expenses to be reimbursed by the
Trust pursuant to expense allocation procedures established by the Adviser
in accordance with generally accepted accounting principles.

IA-1

(5) Liaisons with Agents. The Adviser, at its own expense, shall
maintain liaison with the various agents and other persons employed by the
Trust (including the Trust's transfer agent, custodian, independent
accountants and legal counsel) and assist in the coordination of their
activities on behalf of the Trust. Fees and expenses of such agents and
other persons will be paid by the Trust.

(6) Reports to Trust. The Adviser shall furnish to or place at the
disposal of the Trust such information, reports, valuations, analyses and
opinions as the Trust may, at any time or from time to time, reasonably
request or as the Adviser may deem helpful to the Trust, provided that the
expenses associated with any such materials furnished by the Adviser at the
request of the Trust shall be borne by the Trust.

(7) Reports and Other Communications to Trust Shareholders. The Adviser
shall assist the Trust in developing (but not pay for) all general
shareholder communications including regular shareholder reports.

3. EXPENSES ASSUMED BY THE TRUST

In addition to paying the advisory fee provided for in Section 4, the Trust
will pay all expenses of its organization, operations and business not
specifically assumed or agreed to be paid by the Adviser as provided in this
Agreement, by a Subadviser as provided in a Subadvisory Agreement, or by the
Distributor as provided in the Distribution Agreement. Without limiting the
generality of the foregoing, the Trust, in addition to certain expenses
described in Section 2 above, shall pay or arrange for the payment of the
following:

a. Custody and Accounting Services. All expenses of the transfer,
receipt, safekeeping, servicing and accounting for the Trust's cash,
securities, and other property, including all charges of depositories,
custodians and other agents, if any;

b. Shareholder Servicing. All expenses of maintaining and servicing
shareholder accounts, including all charges of the Trust's transfer,
shareholder recordkeeping, dividend disbursing, redemption, and other
agents, if any;

c. Shareholder Communications. All expenses of preparing, setting in
type, printing, and distributing reports and other communications to
shareholders;

d. Shareholder Meetings. All expenses incidental to holding meetings of
Trust shareholders, including the printing of notices and proxy material,
and proxy solicitation therefor;

e. Prospectuses. All expenses of preparing, setting in type, and
printing of annual or more frequent revisions of the Trust's prospectus and
statement of additional information and any supplements thereto and of
mailing them to shareholders;

f. Pricing. All expenses of computing the net asset value per share for
each of the Funds, including the cost of any equipment or services used for
obtaining price quotations and valuing its investment portfolio;

g. Communication Equipment. All charges for equipment or services used
for communication between the Adviser or the Trust and the custodian,
transfer agent or any other agent selected by the Trust;

h. Legal and Accounting Fees and Expenses. All charges for services and
expenses of the Trust's legal counsel and independent auditors;

i. Trustees and Officers. Except as expressly provided otherwise in
paragraph 2.b.(2), all compensation of Trustees and officers, all expenses
incurred in connection with the service of Trustees and officers, and all
expenses of meetings of the Trustees and Committees of Trustees;

j. Federal Registration Fees. All fees and expenses of registering and
maintaining the registration of the Trust under the Investment Company Act
and the registration of the Trust's shares under the Securities Act of
1933, as amended (the "1933 Act"), including all fees and expenses incurred
in connection with the preparation, setting in type, printing and filing of
any registration statement and prospectus under the 1933 Act or the
Investment Company Act, and any amendments or supplements that may be made
from time to time;

IA-2

k. State Registration Fees. All fees and expenses of qualifying and
maintaining qualification of the Trust and of the Trust's shares for sale
under securities laws of various states or jurisdictions, and of
registration and qualification of the Trust under all other laws applicable
to the Trust or its business activities (including registering the Trust as
a broker-dealer, or any officer of the Trust or any person as agent or
salesman of the Trust in any state);

l. Issue and Redemption of Trust Shares. All expenses incurred in
connection with the issue, redemption, and transfer of Trust shares,
including the expense of confirming all share transactions, and of
preparing and transmitting certificates for shares of beneficial interest
in the Trust;

m. Bonding and Insurance. All expenses of bond, liability and other
insurance coverage required by law or regulation or deemed advisable by the
Trust's Trustees including, without limitation, such bond, liability and
other insurance expense that may from time to time be allocated to the
Trust in a manner approved by its Trustees;

n. Brokerage Commissions. All brokers' commissions and other charges
incident to the purchase, sale, or lending of the Trust's portfolio
securities;

o. Taxes. All taxes or governmental fees payable by or with respect to
the Trust to federal, state, or other governmental agencies, domestic or
foreign, including stamp or other transfer taxes, and all expenses incurred
in the preparation of tax returns;

p. Trade Association Fees. All fees, dues, and other expenses incurred
in connection with the Trust's membership in any trade association or other
investment organization; and

q. Nonrecurring and Extraordinary Expenses. Such nonrecurring expenses
as may arise, including the costs of actions, suits, or proceedings to
which the Trust is, or is threatened to be made, a party and the expenses
the Trust may incur as a result of its legal obligation to provide
indemnification to its Trustees, officers, agents and shareholders.

4. COMPENSATION OF ADVISER

The Adviser will pay the Subadviser with respect to each Fund the
compensation specified in Appendix A to this Agreement (the "Compensation").

5. NON-EXCLUSIVITY

The services of the Adviser to the Trust are not to be deemed to be
exclusive, and the Adviser shall be free to render investment advisory or other
services to others (including other investment companies) and to engage in
other activities. It is understood and agreed that the directors, officers, and
employees of the Adviser are not prohibited from engaging in any other business
activity or from rendering services to any other person, or from serving as
partners, officers, directors, trustees or employees of any other firm or
corporation, including other investment companies.

6. SUPPLEMENTAL ARRANGEMENTS

The Adviser may enter into arrangements with other persons affiliated with
the Adviser to better enable it to fulfill its obligations under this Agreement
for the provision of certain personnel and facilities to the Adviser.

7. CONFLICTS OF INTEREST

It is understood that Trustees, officers, agents and shareholders of the
Trust are or may be interested in the Adviser as directors, officers,
stockholders, or otherwise; that directors, officers, agents and stockholders
of the Adviser are or may be interested in the Trust as Trustees, officers,
shareholders or otherwise; that the Adviser may be interested in the Trust; and
that the existence of any such dual interest shall not affect the validity
hereof or of any transactions hereunder except as otherwise provided in the
Agreement and Declaration of Trust of the Trust and the Articles of
Incorporation of the Adviser, respectively, or by specific provision of
applicable law.

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8. REGULATION

The Adviser shall submit to all regulatory and administrative bodies having
jurisdiction over the services provided pursuant to this Agreement any
information, reports or other material which any such body by reason of this
Agreement may request or require pursuant to applicable laws and regulations.
The Adviser will comply in all material respects with Rule 17j-1 under the
Investment Company Act.

9. DURATION AND TERMINATION OF AGREEMENT

Unless sooner terminated, this Agreement will continue in effect for a
period more than two years from the date of its execution only so long as such
continuance is specifically approved at least annually either by the Trustees
of the Trust or by a majority of the outstanding voting securities of each of
the Portfolios, provided that in either event such continuance shall also be
approved by the vote of a majority of the Trustees of the Trust who are not
interested persons (as defined in the Investment Company Act) of any party to
this Agreement cast in person at a meeting called for the purpose of voting on
such approval.

10. PROVISION OF CERTAIN INFORMATION BY ADVISER

The Adviser will promptly notify the Trust in writing of the occurrence of
any of the following events:

a. the Adviser fails to be registered as an investment adviser under the
Investment Advisers Act or under the laws of any jurisdiction in which the
Adviser is required to be registered as an investment adviser in order to
perform its obligations under this Agreement;

b. the Adviser is served or otherwise receives notice of any action,
suit, proceeding, inquiry or investigation, at law or in equity, before or
by any court, public board or body, involving the affairs of the Trust; and

c. the chief executive officer or controlling stockholder of the Adviser
or the portfolio manager of any Fund changes.

11. AMENDMENTS TO THE AGREEMENT

This Agreement may be amended by the parties only if such amendment is
specifically approved by the vote of a majority of the outstanding voting
securities of each of the Funds affected by the amendment and by the vote of a
majority of the Trustees of the Trust who are not interested persons of any
party to this Agreement cast in person at a meeting called for the purpose of
voting on such approval. The required shareholder approval shall be effective
with respect to any Fund if a majority of the outstanding voting securities of
the series of shares of that Fund vote to approve the amendment,
notwithstanding that the amendment may not have been approved by a majority of
the outstanding voting securities of (a) any other Fund affected by the
amendment or (b) all the Funds of the Trust.

12. ENTIRE AGREEMENT

This Agreement contains the entire understanding and agreement of the
parties.

13. HEADINGS

The headings in the sections of this Agreement are inserted for convenience
of reference only and shall not constitute a part hereof.

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14. NOTICES

All notices required to be given pursuant to this Agreement shall be
delivered or mailed to the last known business address of the Trust or Adviser
in person or by registered mail or a private mail or delivery service providing
the sender with notice of receipt. Notice shall be deemed given on the date
delivered or mailed in accordance with this section.

15. SEVERABILITY

Should any portion of this Agreement for any reason be held to be void in
law or in equity, the Agreement shall be construed, insofar as is possible, as
if such portion had never been contained herein.

16. GOVERNING LAW

The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of The Commonwealth of Massachusetts, or any of the
applicable provisions of the Investment Company Act. To the extent that the
laws of The Commonwealth of Massachusetts, or any of the provisions in this
Agreement, con-flict with applicable provisions of the Investment Company Act,
the latter shall control.

17. LIMITATION OF LIABILITY

The Declaration of Trust establishing the Trust, dated September 29, 1988,
as amended and restated February 18, 1994, a copy of which, together with all
amendments thereto (the "Declaration"), is on file in the office of the
Secretary of The Commonwealth of Massachusetts, provides that the name "North
American Funds" refers to the Trustees under the Declaration collectively as
Trustees, but not as individuals or personally; and no Trustee, shareholder,
officer, employee or agent of the Trust shall be held to any personal
liability, nor shall resort be had to their private property, for the
satisfaction of any obligation or claim, in connection with the affairs of the
Trust or any Fund thereof, but only the assets belonging to the Trust, or to
the particular Fund with which the obligee or claimant dealt, shall be liable.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal by their duly authorized officers as of the date first
mentioned above.

North American Funds

By:
---------------------------------

American General Asset Management
Corp.

By:
---------------------------------

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NORTH AMERICAN FUNDS EXHIBIT IB

SUBADVISORY AGREEMENT

AGREEMENT made as of , 2001, between AMERICAN GENERAL ASSET MANAGEMENT
CORP., a Delaware corporation (the "Adviser"), AND AMERICAN GENERAL INVESTMENT
MANAGEMENT L.P. (or an affiliate), a Delaware limited partnership (the
"Subadviser"). In consideration of the mutual covenants contained herein, the
parties agree as follows:

1. APPOINTMENT OF SUBADVISER

The Subadviser undertakes to act as investment subadviser to, and, subject
to the supervision of the Trustees of North American Funds (the "Trust") and
the terms of this Agreement, to manage the investment and reinvestment of the
assets of the series of the Trust specified in Appendix A to this Agreement as
it shall be amended by the Adviser and the Subadviser from time to time (the
"Funds"). The Subadviser will be an independent contractor and will have no
authority to act for or represent the Trust or Adviser in any way except as
expressly authorized in this Agreement or another writing by the Trust and
Adviser.

2. SERVICES TO BE RENDERED BY THE SUBADVISER TO THE TRUST

a. Subject always to the direction and control of the Trustees of the
Trust, the Subadviser will manage the investments and determine the
composition of the assets of the Funds in accordance with the Funds'
registration statement, as amended. In fulfilling its obligations to manage
the investments and reinvestments of the assets of the Funds, the
Subadviser will:

i. obtain and evaluate pertinent economic, statistical, financial
and other information affecting the economy generally and individual
companies or industries the securities of which are included in the
Funds or are under consideration for inclusion in the Funds;

ii. formulate and implement a continuous investment program for each
Fund consistent with the investment objectives and related investment
policies for each such Fund as described in the Trust's registration
statement, as amended;

iii. take whatever steps are necessary to implement these investment
programs by the purchase and sale of securities including the placing
of orders for such purchases and sales;

iv. regularly report to the Trustees of the Trust with respect to
the implementation of these investment programs;

v. provide assistance to the Trust's Custodian regarding the fair
value of securities held by the Funds for which market quotations are
not readily available for purposes of enabling the Trust's Custodian to
calculate net asset value; and

vi. vote proxies in accordance with the Proxy Voting Policy of the
Trust.

b. The Subadviser, at its expense, will furnish (i) all necessary
investment and management facilities, including salaries of personnel
required for it to execute its duties faithfully, and (ii) administrative
facilities, including bookkeeping, clerical personnel and equipment
necessary for the efficient conduct of the investment affairs of the Funds
(excluding determination of net asset value and shareholder accounting
services).

c. The Subadviser will select brokers and dealers to effect all
transactions subject to the following conditions: The Subadviser will place
all orders with brokers, dealers, or issuers, and will negotiate brokerage
commissions if applicable. The Subadviser is directed at all times to seek
to execute brokerage transactions for the Funds in accordance with such
policies or practices as may be established by the Trustees and described
in the Trust's registration statement as amended. The Subadviser may pay a
broker-dealer which provides research and brokerage services a higher
spread or commission for a particular

IB-1

transaction than otherwise might have been charged by another broker-
dealer, if the Subadviser determines that the higher spread or commission
is reasonable in relation to the value of the brokerage and research
services that such broker-dealer provides, viewed in terms of either the
particular transaction or the Subadviser's overall responsibilities with
respect to accounts managed by the Subadviser. The Subadviser may use for
the benefit of the Subadviser's other clients, or make available to
companies affiliated with the Subadviser or to its directors for the
benefit of its clients, any such brokerage and research services that the
Subadviser obtains from brokers or dealers.

d. On occasions when the Subadviser deems the purchase or sale of a
security to be in the best interest of the Fund as well as other clients of
the Subadviser, the Subadviser to the extent permitted by applicable laws
and regulations, may, but shall be under no obligation to, aggregate the
securities to be purchased or sold to attempt to obtain a more favorable
price or lower brokerage commissions and efficient execution. In such
event, allocation of the securities so purchased or sold, as well as the
expenses incurred in the transaction, will be made by the Subadviser in the
manner the Subadviser considers to be the most equitable and consistent
with its fiduciary obligations to the Fund and to its other clients.

e. The Subadviser will maintain all accounts, books and records with
respect to the Funds as are required of an investment adviser of a
registered investment company under the Investment Company Act of 1940, as
amended (the "Investment Company Act") and Investment Advisers Act of 1940,
as amended (the "Investment Advisers Act") and the rules thereunder.

f. The Subadviser agrees to observe and comply with Rule 17j-1 under the
Investment Company Act and its Code of Ethics (which shall comply in all
material respects with Rule 17j-1, as the same may be amended from time to
time). On a quarterly basis, the Subadviser will either (i) certify to the
Adviser that the Subadviser and its Access Persons have complied with the
Subadviser's Code of Ethics with respect to the Fund or (ii) identify any
material violations which have occurred with respect to the Fund. In
addition, the Subadviser will report at least annually to the Adviser
concerning any other violations of the Subadviser's Code of Ethics which
required significant remedial action and which were not previously
reported.

3. COMPENSATION OF SUBADVISER

The Adviser will pay the Subadviser with respect to each Fund the
compensation specified in Appendix A to this Agreement.

During the term of this Agreement, the following conditions apply:

a. The fee shall be held in an interest-bearing escrow account with
State Street Bank and Trust Company;

b. If a majority of a Covered Fund's outstanding voting securities
approve a new investment sub-advisory agreement (the "New Sub-Advisory
Agreement") with the SUB-ADVISER within 150 days after the date hereof, the
amount in the escrow account (including interest earned thereon) with
respect to such Covered Fund shall be paid to the SUB-ADVISER; and

c. If a majority of a Covered Fund's outstanding voting securities do
not approve a New Sub-Advisory Agreement with the SUB-ADVISER within such
150-day period, the SUB-ADVISER shall be paid from the escrow account, the
lesser of an amount equal to

(i) any costs incurred in performing this Agreement (plus interest
earned on that amount in the escrow account); or

(ii) the total amount in the escrow account (plus interest earned
thereon).

IB-2

4. LIABILITY OF SUBADVISER

Neither the Subadviser nor any of its employees shall be liable to the
Adviser or Trust for any loss suffered by the Adviser or Trust resulting from
any error of judgment made in the good faith exercise of the Subadviser's
investment discretion in connection with selecting Fund investments except for
losses resulting from willful misfeasance, bad faith or gross negligence of, or
from reckless disregard of, the duties of the Subadviser or any of its partners
or employees; and neither the Subadviser nor any of its employees shall be
liable to the Adviser or Trust for any loss suffered by the Adviser or Trust
resulting from any other matters to which this Agreement relates (i.e., those
other matters specified in Sections 2 and 8 of this Agreement), except for
losses resulting from willful misfeasance, bad faith, or gross negligence in
the performance of, or from disregard of, the duties of the Subadviser or any
of its partners or employees.

5. SUPPLEMENTAL ARRANGEMENTS

The Subadviser may enter into arrangements with other persons affiliated
with the Subadviser to better enable it to fulfill its obligations under this
Agreement for the provision of certain personnel and facilities to the
Subadviser.

6. CONFLICTS OF INTEREST

It is understood that trustees, officers, agents and shareholders of the
Trust are or may be interested in the Subadviser as trustees, officers,
partners or otherwise; that directors, officers, agents and partners of the
Subadviser are or may be interested in the Trust as trustees, officers,
shareholders or otherwise; that the Subadviser may be interested in the Trust;
and that the existence of any such dual interest shall not affect the validity
hereof or of any transactions hereunder except as otherwise provided in the
Agreement and Declaration of Trust of the Trust and the Certificate of
Incorporation of the Subadviser, respectively, or by specific provision of
applicable law.

7. REGULATION

The Subadviser shall submit to all regulatory and administrative bodies
having jurisdiction over the services provided pursuant to this Agreement any
information, reports or other material which any such body by reason of this
Agreement may request or require pursuant to applicable laws and regulations.

8. DURATION AND TERMINATION OF AGREEMENT

This Agreement may be terminated at any time, without the payment of any
penalty, by the Trustees of the Trust, by the vote of a majority of the
outstanding voting securities of the Trust, or with respect to any Portfolio by
the vote of a majority of the outstanding voting securities of such Portfolio,
on sixty days' written notice to the Adviser and the Subadviser, or by the
Adviser or Subadviser on sixty days' written notice to the Trust and the other
party. This Agreement will automatically terminate, without the payment of any
penalty, in the event of its assignment (as defined in the Investment Company
Act) or in the event the Advisory Agreement between the Adviser and the Trust
terminates for any reason; provided that the termination of the Interim
Investment Advisory Agreement between the Trust and the Adviser pursuant to
Rule 15a-4 under the Investment Company Act upon shareholder approval of a
definitive Investment Advisory Agreement with respect to a Portfolio shall not
result in the termination of this Agreement as to such Portfolio.

IB-3

9. PROVISION OF CERTAIN INFORMATION BY SUBADVISER

The Subadviser will promptly notify the Adviser in writing of the occurrence
of any of the following events:

a. the Subadviser fails to be registered as an investment adviser under
the Investment Advisers Act or under the laws of any jurisdiction in which
the Subadviser is required to be registered as an investment adviser in
order to perform its obligations under this Agreement;

b. the Subadviser is served or otherwise receives notice of any action,
suit, proceeding, inquiry or investigation, at law or in equity, before or
by any court, public board or body, involving the affairs of the Trust; and

c. any change in actual control or management of the Subadviser or the
portfolio manager of any Fund.

10. PROVISION OF CERTAIN INFORMATION BY THE ADVISER

The Adviser shall furnish the Subadviser with copies of the Trust's
Prospectus and Statement of Additional Information, and any reports made by the
Trust to its shareholders, as soon as practicable after such documents become
available. The Adviser shall furnish the Subadviser with any further documents,
materials or information that the Subadviser may reasonably request to enable
it to perform its duties pursuant to this Agreement.

11. SERVICES TO OTHER CLIENTS

The Adviser understand, and has advised the Trust's Board of Trustees, that
the Subadviser now acts, or may in the future act, as an investment adviser to
fiduciary and other managed accounts and as investment adviser or subadviser to
other investment companies. Further, the Adviser understands, and has advised
the Trust's Board of Trustees that the Subadviser and its affiliates may give
advice and take action for its accounts, including investment companies, which
differs from advice given on the timing or nature of action taken for the Fund.
The Subadviser is not obligated to initiate transaction for the Portfolio in
any security which the Subadviser, its principals, affiliates or employees may
purchase or sell for their own accounts or other clients.

12. AMENDMENTS TO THE AGREEMENT

This Agreement may be amended by the parties only if such amendment is
specifically approved by the vote of a majority of the outstanding voting
securities of each of the Funds affected by the amendment and by the vote of a
majority of the Trustees of the Trust who are not interested persons of any
party to this Agreement cast in person at a meeting called for the purpose of
voting on such approval. The required shareholder approval shall be effective
with respect to any Fund if a majority of the outstanding voting securities of
that Fund vote to approve the amendment, notwithstanding that the amendment may
not have been approved by a majority of the outstanding voting securities of
(a) any other Fund affected by the amendment or (b) all the series of the
Trust.

13. ENTIRE AGREEMENT

This Agreement contains the entire understanding and agreement of the
parties.

14. HEADINGS

The headings in the sections of this Agreement are inserted for convenience
of reference only and shall not constitute a part hereof.

IB-4

15. NOTICES

All notices required to be given pursuant to this Agreement shall be
delivered or mailed to the last known business address of the Trust or
applicable party in person or by registered mail or a private mail or delivery
service providing the sender with notice of receipt. Notice shall be deemed
given on the date delivered or mailed in accordance with this paragraph.

16. SEVERABILITY

17. GOVERNING LAW

The provisions of this Agreement shall be construed and interpreted in
accordance with the laws of The Commonwealth of Massachusetts, or any of the
applicable provisions of the Investment Company Act. To the extent that the
laws of The Commonwealth of Massachusetts, or any of the provisions in this
Agreement, conflict with applicable provisions of the Investment Company Act,
the latter shall control.

18. LIMITATION OF LIABILITY

The Amended and Restated Agreement and Declaration of Trust dated February
18, 1994, a copy of which, together with all amendments thereto (the
"Declaration"), is on file in the office of the Secretary of The Commonwealth
of Massachusetts, provides that the name "North American Funds" refers to the
Trustees under the Declaration collectively as Trustees, but not as individuals
or personally; and no Trustee, shareholder, officer, employee or agent of the
Trust shall be held to any personal liability, nor shall resort be had to their
private property, for the satisfaction of any obligation or claim, in
connection with the affairs of the Trust or any portfolio thereof, but only the
assets belonging to the Trust, or to the particular portfolio with which the
obligee or claimant dealt, shall be liable.

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed under seal by their duly authorized officers as of the date first
mentioned above.

American General Asset Management
Corp.

By: _________________________________

American General Investment
Management, L.P.

By: _________________________________

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EXHIBIT II

Agreement and Plan of Reorganization

Dated as of September 28, 2001

Table of Contents

Page No.
--------

1. Defined Terms; Sections and Exhibits; Miscellaneous Terms.......... 2
a.Definitions....................................................... 2
b.Use of Defined Terms.............................................. 6
c.Sections and Exhibits............................................. 6
d.Miscellaneous Terms............................................... 6
2. The Reorganization(s).............................................. 6
a.Transfer of Assets................................................ 6
b.Assumption of Liabilities......................................... 6
c.Issuance and Valuation of Corresponding Shares in the
Reorganization................................................. 6
d.Distribution of Corresponding Shares to the Acquired Fund
Shareholders................................................... 6
e.Interest; Proceeds................................................ 6
f.Valuation Time.................................................... 6
g.Evidence of Transfer.............................................. 7
h.Termination....................................................... 7
i.Separate Agreements; Reorganizations Not Conditioned on One
Another........................................................ 7
3. Representations and Warranties of the Acquired Fund................ 7
a.Formation and Qualification....................................... 7
b.Licenses.......................................................... 7
c.Authority......................................................... 7
d.Financial Statements.............................................. 8
e.Semi-Annual Report to Shareholders................................ 8
f.Prospectuses and Statement of Additional Information.............. 8
g.Litigation........................................................ 8
h.Material Contracts................................................ 8
i.No Conflict....................................................... 8
j.Undisclosed Liabilities........................................... 8
k.Taxes............................................................. 9
l.Assets............................................................ 9
m.Consents.......................................................... 9
n.N-14 Registration Statement....................................... 9
o.Capitalization.................................................... 9
p.Books and Records................................................. 9
4. Representations and Warranties of the Acquiring Fund............... 9
a.Formation and Qualification....................................... 9
b.Licenses.......................................................... 10
c.Authority......................................................... 10
d.Prospectus and Statement of Additional Information................ 10
e.Litigation........................................................ 10
f.Material Contracts................................................ 10
g.No Conflict....................................................... 11
h.[Intentionally Left Blank]........................................ 11
i.Consents.......................................................... 11
j.N-14 Registration Statement....................................... 11
k.Capitalization.................................................... 11
l.Corresponding Shares.............................................. 11
5. Covenants of the Acquired Fund and the Acquiring Fund.............. 12
a.Special Shareholders' Meeting..................................... 12
b.Unaudited Financial Statements.................................... 12
c.Share Ledger Records of the Acquiring Fund........................ 12

Page No.
--------

d.Conduct of Business............................................... 12
e.Termination of the Acquired Fund.................................. 12
f.Filing of N-14 Registration Statement............................. 12
g.Corresponding Shares.............................................. 12
h.Tax Returns....................................................... 13
i.Combined Proxy Statement and Prospectus Mailing................... 13
j.Confirmation of Tax Basis......................................... 13
k.Shareholder List.................................................. 13
l.New Series........................................................ 13
6. Closing Date....................................................... 13
7. Conditions of the Acquired Fund.................................... 13
a.Representations and Warranties.................................... 13
b.Performance....................................................... 13
c.Shareholder Approval.............................................. 14
d.Approval of Board of Directors.................................... 14
e.Deliveries by the Acquiring Fund.................................. 14
f.Absence of Litigation............................................. 14
g.Proceedings and Documents......................................... 15
h.N-14 Registration Statement; Acquiring Fund Post-Effective
Amendment...................................................... 15
i.Compliance with Laws; No Adverse Action or Decision............... 15
j.Commission Orders or Interpretations.............................. 15
8. Conditions of the Acquiring Fund................................... 15
a.Representations and Warranties.................................... 15
b.Performance....................................................... 15
c.Shareholder Approval.............................................. 15
d.Approval of Board of Trustees..................................... 15
e.Deliveries by the Acquired Fund................................... 16
f.No Material Adverse Change........................................ 16
g.Absence of Litigation............................................. 16
h.Proceedings and Documents......................................... 16
i.N-14 Registration Statement; Acquiring Fund Post-Effective
Amendment...................................................... 16
j.Compliance with Laws; No Adverse Action or Decision............... 16
k.Commission Orders or Interpretations.............................. 16
l.[Intentionally Left Blank]........................................ 16
9. Termination, Postponement and Waivers.............................. 17
a.Termination of Agreement.......................................... 17
b.Commission Order.................................................. 17
c.Effect of Termination............................................. 17
d.Waivers; Non-Material Changes..................................... 17
10. Survival of Representations and Warranties........................ 17
11. Other Matters..................................................... 18
a.Obligations under Massachusetts Law............................... 18
b.Further Assurances................................................ 18
c.Notices........................................................... 18
d.Entire Agreement.................................................. 18
e.Amendment......................................................... 19
f.Governing Law..................................................... 19
g.Assignment........................................................ 19
h.Costs of the Reorganization....................................... 19
i.Severability...................................................... 19
j.Headings.......................................................... 19
k.Counterparts...................................................... 19

AGREEMENT AND PLAN OF REORGANIZATION

THIS AGREEMENT AND PLAN OF REORGANIZATION (this "Agreement") is made as of
the 28th day of September 2001, by and between NORTH AMERICAN FUNDS, a
Massachusetts business trust, on behalf of each Acquired Fund (as defined
herein), each a separate investment portfolio of North American Funds, and
SUNAMERICA STRATEGIC INVESTMENT SERIES, INC., a Maryland corporation, on behalf
of each Acquiring Fund (as defined herein), each a separate investment
portfolio of SunAmerica Strategic Investment Series, Inc.

PLANS OF REORGANIZATION

WHEREAS, this Agreement constitutes a separate agreement and plan of
reorganization between North American Funds on behalf of each of its separate
investment portfolios (each an "Acquired Fund," and collectively, the "Acquired
Funds") and SunAmerica Strategic Investment Series, Inc. on behalf of each of
its separate investment portfolios (each an "Acquiring Fund" and collectively,
the "Acquiring Funds") set forth below:

Acquired Fund: Acquiring Fund:
-------------- ---------------

Stock Index Fund (the "NAF Stock SunAmerica Stock Index Fund
Index Fund")...................
Science & Technology Fund (the
"NAF Science & Technology
Fund")......................... SunAmerica Science & Technology Fund
Aggressive Growth LifeStyle Fund
(the "NAF Aggressive Growth
LifeStyle Fund")............... SunAmerica Aggressive Growth LifeStage Fund
Moderate Growth LifeStyle Fund
(the "NAF Moderate Growth
LifeStyle Fund")............... SunAmerica Moderate Growth LifeStage Fund
Conservative Growth LifeStyle
Fund (the "NAF Conservative
Growth LifeStyle Fund")........ SunAmerica Conservative Growth LifeStage Fund

WHEREAS, each Acquired Fund owns securities that generally are assets of the
character in which the respective Acquiring Fund is permitted to invest;

WHEREAS, each reorganization will consist of (i) the acquisition of an
Acquired Fund's Assets (as defined herein), and assumption of that Acquired
Fund's Assumed Liabilities (as defined herein), by the respective Acquiring
Fund solely in exchange for an aggregate value of newly issued shares of common
stock, $0.0001 par value per share, of such Acquiring Fund (the "Shares"),
equal to the net asset value of such Acquired Fund's Assets determined in
accordance with Section 2(c) hereof, and (ii) the subsequent distribution by
that Acquired Fund of the Shares to its shareholders in liquidation of the
Acquired Fund, all upon and subject to the terms hereinafter set forth (each a
"Reorganization" and collectively the "Reorganizations");

WHEREAS, in the course of each Reorganization, Shares of an Acquiring Fund
will be issued to an Acquired Fund and distributed to the shareholders thereof
as follows: each holder, if any, of Class A, Class B, Class C, and
Institutional Class I shares of an Acquired Fund will be entitled to receive
Class A, Class B, Class II, and Class I Shares, respectively (the
"Corresponding Shares"), of the respective Acquiring Fund on the Closing Date
(as defined herein);

WHEREAS, the aggregate net asset value of the Corresponding Shares to be
received by each shareholder of an Acquired Fund will equal the aggregate net
asset value of the respective Acquired Fund shares owned by such shareholder as
of the Valuation Time (as defined herein);

WHEREAS, it is intended that each Reorganization described herein shall be a
reorganization within the meaning of Section 368(a) of the Internal Revenue
Code of 1986, as amended (the "Code"), and any successor provision and the
parties intend, by executing this Agreement, to adopt a plan of reorganization
within the meaning of Section 368(a) of the Code; and

WHEREAS, the consummation of one Reorganization is not conditioned upon the
consummation of any other Reorganization.

AGREEMENT

NOW, THEREFORE, in order to consummate each Reorganization and in
consideration of the premises and the covenants and agreements hereinafter set
forth, and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, and intending to be legally bound, each
Acquired Fund and Acquiring Fund hereby agree as follows:

1. Defined Terms; Sections and Exhibits; Miscellaneous Terms.

a. Definitions. As used herein the following terms have the following
respective meanings:

"Acquired Fund" has the meaning ascribed thereto under the heading
"Plans of Reorganization." For purposes of this Agreement, the term
"Acquired Fund" shall refer to the NAF Stock Index Fund in respect of the
Stock Index Funds Reorganization, the NAF Science & Technology Fund in
respect of the Science & Technology Funds Reorganization, the NAF
Aggressive Growth LifeStyle Fund in respect of the Aggressive Growth
LifeStage Funds Reorganization, the NAF Moderate Growth LifeStyle Fund in
respect of the Moderate Growth LifeStage Funds Reorganization, and the NAF
Conservative Growth LifeStyle Fund in respect of the Conservative Growth
LifeStage Funds Reorganization.

"Acquiring Fund" has the meaning ascribed thereto under the heading
"Plans of Reorganization." For purposes of this Agreement, the term
"Acquiring Fund" shall refer to the SunAmerica Stock Index Fund in respect
of the Stock Index Funds Reorganization, the SunAmerica Science &
Technology Fund in respect of the Science & Technology Funds
Reorganization, the SunAmerica Aggressive Growth LifeStage Fund in respect
of the Aggressive Growth LifeStage Funds Reorganization, the SunAmerica
Moderate Growth LifeStage Fund in respect of the Moderate Growth LifeStage
Funds Reorganization, and the SunAmerica Conservative Growth LifeStage Fund
in respect of the Conservative Growth LifeStage Funds Reorganization.

"Acquiring Fund Post-Effective Amendment" has the meaning ascribed
thereto in Section 5(l) hereof.

"Aggressive Growth LifeStage Funds Reorganization" consists of (i) the
acquisition of the NAF Aggressive Growth LifeStyle Fund's Assets, and
assumption of the NAF Aggressive Growth LifeStyle Fund's Assumed
Liabilities, by the SunAmerica Aggressive Growth LifeStage Fund solely in
exchange for an aggregate value of Corresponding Shares of the SunAmerica
Aggressive Growth LifeStage Fund, equal to the net asset value of the NAF
Aggressive Growth LifeStyle Fund's Assets determined in accordance with
Section 2(c) hereof, and (ii) the subsequent distribution by the NAF
Aggressive Growth LifeStyle Fund of such Corresponding Shares to its
shareholders in proportion to such shareholders' interest in the NAF
Aggressive Growth LifeStyle Fund in liquidation of the NAF Aggressive
Growth LifeStyle Fund.

"Agreement" has the meaning ascribed thereto in the introduction hereof.

"Assets" has the meaning ascribed thereto in Section 2(a) hereof. For
purposes of this Agreement, the term "Assets" shall refer to Assets of (i)
the NAF Stock Index Fund in the case of the Stock Index Funds
Reorganization, (ii) the NAF Science & Technology Fund in the case of the
Science & Technology Funds Reorganization, (iii) the NAF Aggressive Growth
LifeStyle Fund in the case of the Aggressive Growth LifeStage Funds
Reorganization, (iv) the NAF Moderate Growth LifeStyle Fund in the case of
the Moderate Growth LifeStage Funds Reorganization, and (v) the NAF
Conservative Growth LifeStyle Fund in the case of the Conservative Growth
LifeStage Funds Reorganization.

"Assumed Liabilities" has the meaning ascribed thereto in Section 2(b)
hereof. For purposes of this Agreement, the term "Assumed Liabilities"
shall refer to the Assumed Liabilities of (i) the NAF Stock Index Fund in
the case of the Stock Index Funds Reorganization, (ii) the NAF Science &
Technology Fund in the case of the Science & Technology Funds
Reorganization, (iii) the NAF Aggressive Growth LifeStyle Fund in the case
of the Aggressive Growth LifeStage Funds Reorganization, (iv) the NAF
Moderate Growth LifeStyle Fund in the case of the Moderate Growth LifeStage
Funds Reorganization and (v) the NAF Conservative Growth LifeStyle Fund in
the case of the Conservative Growth LifeStage Funds Reorganization.

"Closing Date" has the meaning ascribed thereto in Section 6 hereof.

"Code" has the meaning ascribed thereto under the heading "Plans of
Reorganization."

"Commission" shall mean the Securities and Exchange Commission.

"Conservative Growth LifeStage Funds Reorganization" consists of (i) the
acquisition of the NAF Conservative Growth LifeStyle Fund's Assets, and
assumption of the NAF Conservative Growth LifeStyle Fund's Assumed
Liabilities, by the SunAmerica Conservative Growth LifeStage Fund solely in
exchange for an aggregate value of Corresponding Shares of the SunAmerica
Conservative Growth LifeStage Fund, equal to the net asset value of the NAF
Conservative Growth LifeStyle Fund's Assets determined in accordance with
Section 2(c) hereof, and (ii) the subsequent distribution by the NAF
Conservative Growth LifeStyle Fund of such Corresponding Shares to its
shareholders in proportion to such shareholders' interest in the NAF
Conservative Growth LifeStyle Fund in liquidation of the NAF Conservative
Growth LifeStyle Fund.

"Corresponding Shares" has the meaning ascribed thereto under the
heading "Plans of Reorganization." For purposes of this Agreement, the term
"Corresponding Shares" shall refer to the Corresponding Shares of (i) the
SunAmerica Stock Index Fund in the case of the Stock Index Funds
Reorganization, (ii) the SunAmerica Science & Technology Fund in the case
of the Science & Technology Funds Reorganization, (iii) the SunAmerica
Aggressive Growth LifeStage Fund in the case of the Aggressive Growth
LifeStage Funds Reorganization, (iv) the SunAmerica Moderate Growth
LifeStage Fund in the case of the Moderate Growth LifeStage Funds
Reorganization, and (v) the SunAmerica Conservative Growth LifeStage Fund
in the case of the Conservative Growth LifeStage Funds Reorganization.

"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended.

"Governmental Authority" shall mean any governmental or quasi-
governmental authority, including, without limitation, any Federal, state,
territorial, county, municipal or other governmental or quasi-governmental
agency, board, branch, bureau, commission, court, arbitral body, department
or other instrumentality or political unit or subdivision, whether domestic
or foreign.

"Investment Company Act" shall mean the Investment Company Act of 1940,
as amended.

"Investments" shall mean, with respect to any Person, (i) the
investments of such Person shown on the schedule of its investments as of
the date set forth therein, with such additions thereto and deletions
therefrom as may have arisen in the course of such Person's business up to
such date; and (ii) all other assets owned by such Person or liabilities
incurred as of such date.

"Licenses" has the meaning ascribed thereto in Section 3(b) hereof.

"Lien" shall mean any security agreement, financing statement (whether
or not filed), mortgage, lien (statutory or otherwise), charge, pledge,
hypothecation, conditional sales agreement, adverse claim, title retention
agreement or other security interest, encumbrance, restriction, deed of
trust, indenture, option, limitation, exception to or other title defect in
or on any interest or title of any vendor, lessor, lender or other secured
party to or of such Person under any conditional sale, lease, consignment
or bailment given for security purposes, trust receipt or other title
retention agreement with respect to any property or asset of such Person,
whether direct, indirect, accrued or contingent.

"Majority Shareholder Vote" shall mean the lesser of (i) more than 50%
of the outstanding shares of the Acquired Fund and (ii) 67% or more of the
shares of the Acquired Fund represented at the special shareholders'
meeting referenced in Section 5(a) hereof if more than 50% of such shares
are represented.

"Material Adverse Effect" shall mean, with respect to any Person, any
event, circumstance or condition that, individually or when aggregated with
all other similar events, circumstances or conditions could reasonably be
expected to have, or has had, a material adverse effect on: (i) the
business, property,

operations, condition (financial or otherwise), results of operations or
prospects of such Person or (ii) the ability of such Person to consummate
the transactions contemplated hereunder in the manner contemplated hereby,
other than, in each case, any change relating to the economy or securities
markets in general.

"Moderate Growth LifeStage Funds Reorganization" consists of (i) the
acquisition of the NAF Moderate Growth LifeStyle Fund's Assets, and
assumption of the NAF Moderate Growth LifeStyle Fund's Assumed Liabilities,
by the SunAmerica Moderate Growth LifeStage Fund solely in exchange for an
aggregate value of Corresponding Shares of the SunAmerica Moderate Growth
LifeStage Fund, equal to the net asset value of the NAF Moderate Growth
LifeStyle Fund's Assets determined in accordance with Section 2(c) hereof,
and (ii) the subsequent distribution by the NAF Moderate Growth LifeStyle
Fund of such Corresponding Shares to its shareholders in proportion to such
shareholder's interest in the NAF Moderate Growth LifeStyle Fund in
liquidation of the NAF Moderate Growth LifeStyle Fund.

"NAF Aggressive Growth LifeStyle Fund" has the meaning ascribed thereto
under the heading "Plans of Reorganization."

"NAF Conservative Growth LifeStyle Fund" has the meaning ascribed
thereto under the heading "Plans of Reorganization."

"NAF Moderate Growth LifeStyle Fund" has the meaning ascribed thereto
under the heading "Plans of Reorganization."

"NAF Science & Technology Fund" has the meaning ascribed thereto under
the heading "Plans of Reorganization."

"NAF Stock Index Fund" has the meaning ascribed thereto under the
heading "Plans of Reorganization."

"North American Funds Declaration of Trust" shall mean the Amended and
Restated Agreement and Declaration of Trust of North American Funds dated
as of February 18, 1994, as amended or supplemented from time to time.

"North American Funds Prospectuses" shall mean the prospectuses relating
to the Acquired Funds each dated March 1, 2001, in each case as amended or
supplemented.

"North American Funds Statement of Additional Information" shall mean
the statement of additional information relating to the Acquired Funds,
dated March 1, 2001, as amended or supplemented.

"N-14 Registration Statement" has the meaning ascribed thereto in
Section 3(n) hereof.

"Permitted Liens" shall mean, with respect to any Person, any Lien
arising by reason of (i) taxes, assessments, governmental charges or claims
that are either not yet delinquent, or being contested in good faith for
which adequate reserves have been recorded, (ii) the Federal or state
securities laws, and (iii) imperfections of title or encumbrances as do not
materially detract from the value or use of the Assets or materially affect
title thereto.

"Person" shall mean any individual, corporation, limited liability
company, limited or general partnership, joint venture, association, joint
stock company, trust, unincorporated organization, or government or any
agency or political subdivision thereof.

"Reorganization" has the meaning ascribed thereto in the third paragraph
under the heading "Plans of Reorganization" hereof. For purposes of this
Agreement, the term "Reorganization" shall refer to the Stock Index Funds
Reorganization, the Science & Technology Funds Reorganization, the
Aggressive Growth LifeStage Funds Reorganization, the Moderate Growth
LifeStage Funds Reorganization, or the Conservative Growth LifeStage Funds
Reorganization, as the context requires.

"RICs" has the meaning ascribed thereto in Section 3(b) hereof.

"Rule 17a-8(a)" shall mean Rule 17a-8(a) under the Investment Company
Act.

"S&S" shall mean Shearman & Sterling, counsel to SunAmerica Strategic
Investment Series, Inc. and the Acquiring Funds.

"Science & Technology Funds Reorganization" consists of (i) the
acquisition of the NAF Science & Technology Fund's Assets, and assumption
of the NAF Science & Technology Fund's Assumed Liabilities, by the
SunAmerica Science & Technology Fund solely in exchange for an aggregate
value of Corresponding Shares of the SunAmerica Science & Technology Fund,
equal to the net asset value of the NAF Science & Technology Fund's Assets
determined in accordance with Section 2(c) hereof, and (ii) the subsequent
distribution by the NAF Science & Technology Fund of such Corresponding
Shares to its shareholders in proportion to such shareholders' interest in
the NAF Science & Technology Fund in liquidation of the NAF Science &
Technology Fund.

"Section 17 Order" shall mean an order obtained from the Commission
pursuant to Section 17(b) of the Investment Company Act to exempt
consummation of a Reorganization from the prohibitions of Section 17(a) of
such Act.

"Securities Act" shall mean the Securities Act of 1933, as amended.

"Shares" has the meaning ascribed thereto under the heading "Plans of
Reorganization."

"Stock Index Funds Reorganization" consists of (i) the acquisition of
the NAF Stock Index Fund's Assets, and assumption of the NAF Stock Index
Fund's Assumed Liabilities, by the SunAmerica Stock Index Fund solely in
exchange for an aggregate value of Corresponding Shares of the SunAmerica
Stock Index Fund, equal to the net asset value of the NAF Stock Index
Fund's Assets determined in accordance with Section 2(c) hereof, and (ii)
the subsequent distribution by the NAF Stock Index Fund of such
Corresponding Shares to its shareholders in proportion to such
shareholders' interest in the NAF Stock Index Fund in liquidation of the
NAF Stock Index Fund.

"SunAmerica Aggressive Growth LifeStage Fund" has the meaning ascribed
thereto under the heading "Plans of Reorganization."

"SunAmerica Conservative Growth LifeStage Fund" has the meaning ascribed
thereto under the heading "Plans of Reorganization."

"SunAmerica Moderate Growth LifeStage Fund" has the meaning ascribed
thereto under the heading "Plans of Reorganization."

"SunAmerica Science & Technology Fund" has the meaning ascribed thereto
under the heading "Plans of Reorganization."

"SunAmerica Stock Index Fund" has the meaning ascribed thereto under the
heading "Plans of Reorganization."

"SunAmerica Strategic Investment Series, Inc. Articles of Incorporation"
shall mean the Articles of Incorporation of SunAmerica Strategic Investment
Series, Inc., dated as of December 16, 1998, as amended from time to time.

"SunAmerica Strategic Investment Series, Inc. Prospectuses" shall mean
the prospectuses relating to the Acquiring Funds, dated February 28, 2001
in the case of Class A, Class B, and Class II shares and the preliminary
prospectus contained in the Acquiring Fund Post-Effective Amendment in the
case of Class I shares, in each case as amended or supplemented.

"SunAmerica Strategic Investment Series, Inc. Statements of Additional
Information" shall mean the statement of additional information relating to
the Acquiring Funds, dated February 28, 2001 in the case of Class A, Class
B and Class II and the preliminary statement of additional information
contained in the Acquiring Fund Post-Effective Amendment in the case of
Class I Shares, in each case as amended or supplemented.

"Valuation Time" has the meaning ascribed thereto in Section 2(f)
hereof.

b. Use of Defined Terms. Any defined term used in the plural shall refer to
all members of the relevant class, and any defined term used in the singular
shall refer to any one or more of the members of the relevant class. The use of
any gender shall be applicable to all genders.

c. Sections and Exhibits. References in this Agreement to Sections, Exhibits
and Schedules are to Sections, Exhibits and Schedules of and to this Agreement.
The Exhibits and Schedules to this Agreement are hereby incorporated herein by
this reference as if fully set forth herein.

d. Miscellaneous Terms. The term "or" shall not be exclusive. The terms
"herein," "hereof," "hereto," "hereunder" and other terms similar to such terms
shall refer to this Agreement as a whole and not merely to the specific
article, section, paragraph or clause where such terms may appear. The term
"including" shall mean "including, but not limited to."

2. The Reorganization(s).

a. Transfer of Assets. Subject to receiving the requisite approval of the
shareholders of the Acquired Fund, and to the other terms and conditions
contained herein and on the basis of the representations and warranties
contained herein, on the Closing Date, the Acquired Fund shall convey, transfer
and deliver to the Acquiring Fund, and the Acquiring Fund shall purchase,
acquire and accept from the Acquired Fund, free and clear of all Liens (other
than Permitted Liens), all of the property and assets (including cash,
securities, commodities, interests in futures and dividends, any deferred or
prepaid expenses and interest accrued on debt instruments, in each case as of
the Valuation Time) owned by the Acquired Fund (as to each Acquired Fund, such
assets are collectively referred to herein as the "Assets").

b. Assumption of Liabilities. Subject to receiving the requisite approval of
the shareholders of the Acquired Fund, and to the other terms and conditions
contained herein and on the basis of the representations and warranties
contained herein, on the Closing Date, the Acquiring Fund will assume and agree
to pay, perform and discharge when due all of the obligations and liabilities
of the Acquired Fund then existing, whether absolute, accrued, contingent or
otherwise (as to each Acquired Fund, such liabilities are collectively referred
to herein as the "Assumed Liabilities").

c. Issuance and Valuation of Corresponding Shares in the
Reorganization. Full Corresponding Shares, and to the extent necessary, a
fractional Corresponding Share, of an aggregate net asset value equal to the
net asset value of the Assets (after deducting the Assumed Liabilities)
acquired by the Acquiring Fund hereunder, determined as hereinafter provided
shall be issued by the Acquiring Fund to the Acquired Fund in exchange for such
Assets. The net asset value of each of the Acquired Fund's Assets and the
Acquiring Fund's Corresponding Shares shall be determined in accordance with
the procedures described in the SunAmerica Strategic Investment Series, Inc.
Prospectuses and the SunAmerica Strategic Investment Series, Inc. Statements of
Additional Information as of the Valuation Time. Such valuation and
determination shall be made by the Acquiring Fund in cooperation with the
Acquired Fund.

d. Distribution of Corresponding Shares to the Acquired Fund
Shareholders. Pursuant to this Agreement, as soon as practicable after the
Valuation Time, the Acquired Fund will distribute all Corresponding Shares
received by it from the Acquiring Fund in connection with the Reorganization to
its shareholders in proportion to such shareholders' interest in the Acquired
Fund. Such distribution shall be accomplished by the opening of shareholder
accounts on the share ledger records of the Acquiring Fund in the amounts due
to the shareholders of the Acquired Fund based on their respective holdings in
the Acquired Fund as of the Valuation Time.

e. Interest; Proceeds. The Acquired Fund will pay or cause to be paid to the
Acquiring Fund any interest or proceeds it receives on or after the Closing
Date with respect to its Assets.

f. Valuation Time.

i. The Valuation Time shall be the close of the New York Stock Exchange
(generally 4:00 P.M., New York time) on November 9, 2001, or such earlier
or later day and time as may be mutually agreed upon in writing between the
parties hereto (the "Valuation Time").

ii. In the event that at the Valuation Time (a) the New York Stock
Exchange or another primary trading market for portfolio securities of the
Acquiring Fund or the Acquired Fund shall be closed to trading or trading
thereon shall be restricted; or (b) trading or the reporting of trading on
said Exchange or elsewhere shall be disrupted so that accurate appraisal of
the value of the net assets of the Acquiring Fund or the Acquired Fund is
impracticable, the Valuation Time shall be postponed until the close of the
New York Stock Exchange on the first business day after the day when
trading shall have been fully resumed and reporting shall have been
restored.

g. Evidence of Transfer. The Acquiring Fund and the Acquired Fund will
jointly file any instrument as may be required by the Commonwealth of
Massachusetts to effect the transfer of the Assets to the Acquiring Fund.

h. Termination. The Acquired Fund's existence as a separate investment
portfolio of North American Funds will be terminated as soon as practicable
following the consummation of the applicable Reorganization by making any
required filings with the Commonwealth of Massachusetts, as provided in Section
5(e) hereof.

i. Separate Agreements; Reorganizations Not Conditioned on One Another. Each
of the respective parties hereto hereby agrees that this Agreement shall
constitute a separate agreement and plan of reorganization as to each of (i)
the Stock Index Funds Reorganization, (ii) the Science & Technology Funds
Reorganization, (iii) the Aggressive Growth LifeStage Funds Reorganization,
(iv) the Moderate Growth LifeStage Funds Reorganization, and (v) the
Conservative Growth LifeStage Funds Reorganization. The parties further agree
that the consummation of one Reorganization shall not be conditioned on the
consummation of any other Reorganization.

3. Representations and Warranties of the Acquired Fund.

The Acquired Fund represents and warrants to the Acquiring Fund as follows:

a. Formation and Qualification. The Acquired Fund is a separate investment
portfolio of North American Funds, a business trust duly organized, validly
existing and in good standing in conformity with the laws of the State of
Maryland, and the Acquired Fund has all requisite power and authority to own
all of its properties or assets and carry on its business as presently
conducted. North American Funds is duly qualified, registered or licensed to do
business and is in good standing in each jurisdiction in which the ownership of
its properties or assets or the character of its present operations makes such
qualification, registration or licensing necessary, except where the failure to
so qualify or be in good standing would not have a Material Adverse Effect on
the Acquired Fund.

b. Licenses. The Acquired Fund (or North American Funds on behalf of the
Acquired Fund) holds all permits, consents, registrations, certificates,
authorizations and other approvals (collectively, "Licenses") required for the
conduct of its business as now being conducted; all such Licenses are in full
force and effect and no suspension or cancellation of any of them is pending or
threatened; and none of such Licenses will be affected by the consummation of
the transactions contemplated by this Agreement in a manner that would have a
Material Adverse Effect on the Acquired Fund. North American Funds is duly
registered under the Investment Company Act as an open-end management
investment company (File No. 811-05797), and such registration has not been
suspended, revoked or rescinded and is in full force and effect. The Acquired
Fund has elected and qualified for the special tax treatment afforded regulated
investment companies ("RICs") under Sections 851-855 of the Code at all times
since its inception and intends to continue to so qualify for its current
taxable year.

c. Authority. North American Funds, on behalf of the Acquired Fund, has full
power and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
and the consummation of the transactions contemplated hereby have been duly and
validly authorized by all necessary action on the part of the Acquired Fund and
no other proceedings on

the part of North American Funds or the Acquired Fund are necessary to
authorize this Agreement or the consummation of the transactions contemplated
hereby, except for the approval of the Acquired Fund shareholders as provided
in Section 7(c) hereof. This Agreement has been duly and validly executed by
North American Funds, on behalf of the Acquired Fund, and, subject to receipt
of the requisite shareholder approval, and assuming due authorization,
execution and delivery of this Agreement by the Acquiring Fund, this Agreement
constitutes a legal, valid and binding obligation of the Acquired Fund
enforceable against the Acquired Fund in accordance with its terms, subject to
the effects of bankruptcy, insolvency, moratorium, fraudulent conveyance and
similar laws relating to or affecting creditors' rights generally and court
decisions with respect thereto and the remedy of specific performance and
injunctive and other forms of equitable relief.

d. Financial Statements. The Acquiring Fund has been furnished with an
accurate, correct and complete statement of assets and liabilities and a
schedule of Investments of the Acquired Fund, each as of October 31, 2000, said
financial statements having been audited by PricewaterhouseCoopers LLP,
independent public accountants. Such audited financial statements fairly
present in all material respects the financial position of the Acquired Fund as
of the dates and for the periods referred to therein and in conformity with
generally accepted accounting principles applied on a consistent basis.

e. Semi-Annual Report to Shareholders. The Acquiring Fund has been furnished
with the Acquired Fund's Semi-Annual Report to Shareholders for the six months
ended April 30, 2001, and the unaudited financial statements appearing therein
fairly present in all material respects the financial position of the Acquired
Fund as of the dates and for the periods referred to therein and in conformity
with generally accepted accounting principles applied on a consistent basis.

f. Prospectuses and Statement of Additional Information. The Acquiring Fund
has been furnished with the North American Funds Prospectuses and the North
American Funds Statement of Additional Information, and insofar as they relate
to the Acquired Fund, said Prospectuses and Statement of Additional Information
do not contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.

g. Litigation. There are no claims, actions, suits or legal, administrative
or other proceedings pending or, to the knowledge of the Acquired Fund,
threatened against the Acquired Fund that could reasonably be expected to have
a Material Adverse Effect on the Acquired Fund. The Acquired Fund is not
charged with or, to its knowledge, threatened with any violation, or
investigation of any possible violation, of any provisions of any Federal,
state or local law or regulation or administrative ruling relating to any
aspect of its business that could reasonably be expected to have a Material
Adverse Effect on the Acquired Fund.

h. Material Contracts. There are no material contracts outstanding to which
North American Funds on behalf of the Acquired Fund is a party that have not
been disclosed in the N-14 Registration Statement, the North American Funds
Prospectuses or the North American Funds Statement of Additional Information.

i. No Conflict. The execution and delivery of this Agreement by North
American Funds on behalf of the Acquired Fund and the consummation of the
transactions contemplated hereby will not contravene or constitute a default
under or violation of (i) North American Funds' Declaration of Trust or by-
laws, each as amended, supplemented and in effect as of the date hereof, (ii)
any agreement or contract (or require the consent of any Person under any
agreement or contract that has not been obtained) to which North American Funds
on behalf of the Acquired Fund is a party or to which its assets or properties
are subject, or (iii) any judgment, injunction, order or decree, or other
instrument binding upon the Acquired Fund or any of its assets or properties,
except where such contravention, default or violation would not have a Material
Adverse Effect on the Acquired Fund.

j. Undisclosed Liabilities. The Acquired Fund has no material liabilities,
contingent or otherwise, other than those shown on its statements of assets and
liabilities referred to herein, those incurred in the ordinary course of its
business since April 30, 2001, and those incurred in connection with the
Reorganization.

k. Taxes. The Acquired Fund has filed (or caused to be filed), or has
obtained extensions to file, all Federal, state and local tax returns which are
required to be filed by it, and has paid (or caused to be paid) or has obtained
extensions to pay, all taxes shown on said returns to be due and owing and all
assessments received by it, up to and including the taxable year in which the
Closing Date occurs. All tax liabilities of the Acquired Fund have been
adequately provided for on its books, and no tax deficiency or liability of the
Acquired Fund has been asserted and no question with respect thereto has been
raised by the Internal Revenue Service or by any state or local tax authority
for taxes in excess of those already paid, up to and including the taxable year
in which the Closing Date occurs.

l. Assets. The Acquired Fund has good and marketable title to the Assets,
free and clear of all Liens, except for Permitted Liens. The Acquired Fund is
the direct sole and exclusive owner of the Assets. At the Closing Date, upon
consummation of the transactions contemplated hereby, the Acquiring Fund will
have good and marketable title to the Assets, free and clear of all Liens,
except for Permitted Liens.

m. Consents. No filing or registration with, or consent, approval,
authorization or order of, any Person is required for the consummation by the
Acquired Fund of the Reorganization, except for (i) such as may be required
under the Securities Act, the Exchange Act, the Investment Company Act or state
securities laws (which term as used herein shall include the laws of the
District of Columbia and Puerto Rico), (ii) a Majority Shareholder Vote, and
(iii) if necessary, receipt of a Section 17 Order.

n. N-14 Registration Statement. The registration statement filed, or to be
filed, by SunAmerica Strategic Investment Series, Inc. on Form N-14 relating to
the Corresponding Shares to be issued pursuant to this Agreement, which
includes the proxy statement of the Acquired Fund and the prospectus of the
Acquiring Fund with respect to the transactions contemplated hereby, and any
supplement or amendment thereto or to the documents therein (as amended and
supplemented, the "N-14 Registration Statement"), on the effective date of the
N-14 Registration Statement, at the time of the shareholders' meeting referred
to in Section 5(a) hereof and on the Closing Date, insofar as it relates to the
Acquired Fund (i) complied, or will comply, as the case may be, in all material
respects, with the applicable provisions of the Securities Act, the Exchange
Act and the Investment Company Act and the rules and regulations promulgated
thereunder, and (ii) did not, or will not, as the case may be, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.

o. Capitalization. Under the Declaration of Trust of North American Funds,
the Acquired Fund is authorized to issue an unlimited number of full and
fractional shares of beneficial interest, par value $0.001 per share, divided
into four classes designated Class A, Class B, Class C and Institutional Class
I shares. All issued and outstanding shares of the Acquired Fund are duly
authorized, validly issued, fully paid and non-assessable and free of
preemptive rights. Except for (i) the right of Class B shares of the Acquired
Fund to automatically convert to Class A shares of the Acquired Fund eight
years after the purchase thereof, or (ii) in connection with any automatic
dividend reinvestment plan available to the Acquired Fund shareholders, there
are no options warrants, subscriptions, calls or other rights, agreements or
commitments obligating the Acquired Fund to issue any of its shares or
securities convertible into its shares.

p. Books and Records. The books and records of the Acquired Fund made
available to the Acquiring Fund and/or its counsel are substantially true and
correct and contain no material misstatements or omissions with respect to the
operations of the Acquired Fund.

4. Representations and Warranties of the Acquiring Fund.

The Acquiring Fund represents and warrants to the Acquired Fund as follows:

a. Formation and Qualification. The Acquiring Fund is a separate investment
portfolio of SunAmerica Strategic Investment Series, Inc., a corporation duly
organized, validly existing and in good standing in

conformity with the laws of the State of Maryland, and the Acquiring Fund has
all requisite power and authority to own all of its properties or assets and
carry on its business as presently conducted. SunAmerica Strategic Investment
Series, Inc. is duly qualified, registered or licensed as a foreign corporation
to do business and is in good standing in each jurisdiction in which the
ownership of its properties or assets or the character of its present
operations makes such qualification, registration or licensing necessary,
except where the failure to so qualify or be in good standing would not have a
Material Adverse Effect on the Acquiring Fund. The Acquiring Fund has not yet
commenced operations and the only Shares issued have been to an initial seed
investor.

b. Licenses. The Acquiring Fund (or SunAmerica Strategic Investment Series,
Inc. on behalf of the Acquiring Fund) holds all Licenses required for the
conduct of its business as now being conducted; all such Licenses are in full
force and effect and no suspension or cancellation of any of them is pending or
threatened; and none of such Licenses will be affected by the consummation of
the transactions contemplated by this Agreement in a manner that would have a
Material Adverse Effect on the Acquiring Fund. SunAmerica Strategic Investment
Series, Inc. is duly registered under the Investment Company Act as an open-end
management investment company (File No. 811-0169), and such registration has
not been revoked or rescinded and is in full force and effect. The Acquiring
Fund intends to qualify for the special tax treatment afforded to RICs under
Sections 851-855 of the Code from and after consummation of the Reorganization.

c. Authority. SunAmerica Strategic Investment Series, Inc., on behalf of the
Acquiring Fund, has full power and authority to execute and deliver this
Agreement and to consummate the transactions contemplated hereby. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by all necessary
action on the part of the Acquiring Fund and no other proceedings on the part
of the Acquiring Fund are necessary to authorize this Agreement or the
consummation of the transactions contemplated hereby. This Agreement has been
duly and validly executed by SunAmerica Strategic Investment Series, Inc., on
behalf of the Acquiring Fund, and assuming due authorization, execution and
delivery of this Agreement by the Acquired Fund, this Agreement constitutes a
legal, valid and binding obligation of the Acquiring Fund enforceable against
the Acquiring Fund in accordance with its terms, subject to the effects of
bankruptcy, insolvency, moratorium, fraudulent conveyance and similar laws
relating to or affecting creditors' rights generally and court decisions with
respect thereto and the remedy of specific performance and injunctive and other
forms of equitable relief.

d. Prospectus and Statement of Additional Information. The Acquired Fund has
been furnished with the SunAmerica Strategic Investment Series, Inc.
Prospectuses and the SunAmerica Strategic Investment Series, Inc. Statements of
Additional Information, and insofar as they relate to the Acquiring Fund, said
Prospectuses and Statements of Additional Information do not contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading.

e. Litigation. There are no claims, actions, suits or legal, administrative
or other proceedings pending or, to the knowledge of the Acquiring Fund,
threatened against the Acquiring Fund that could reasonably be expected to have
a Material Adverse Effect on the Acquiring Fund. The Acquiring Fund is not
charged with or, to its knowledge, threatened with any violation, or
investigation of any possible violation, of any provisions of any Federal,
state or local law or regulation or administrative ruling relating to any
aspect of its business that could reasonably be expected to have a Material
Adverse Effect on the Acquiring Fund.

f. Material Contracts. There are no material contracts outstanding to which
SunAmerica Strategic Investment Series, Inc. on behalf of the Acquiring Fund is
a party that have not been disclosed in the N-14 Registration Statement, the
SunAmerica Strategic Investment Series, Inc. Prospectuses, or the SunAmerica
Strategic Investment Series, Inc. Statements of Additional Information.

g. No Conflict. The execution and delivery of this Agreement by SunAmerica
Strategic Investment Series, Inc. on behalf of the Acquiring Fund and the
consummation of the transactions contemplated hereby will not contravene or
constitute a default under or violation of (i) the SunAmerica Strategic
Investment Series, Inc. Articles of Incorporation or by-laws, each as amended,
supplemented and in effect as of the date hereof, (ii) any agreement or
contract (or require the consent of any Person under any agreement or contract
that has not been obtained) to which SunAmerica Strategic Investment Series,
Inc. on behalf of the Acquiring Fund is a party or to which its assets or
properties are subject, or (iii) any judgment, injunction, order or decree, or
other instrument binding upon the Acquiring Fund or any of its assets or
properties, except where such contravention, default or violation would not
have a Material Adverse Effect on the Acquiring Fund.

h. [Intentionally Left Blank]

i. Consents. No filing or registration with, or consent, approval,
authorization or order of, any Person is required for the consummation by the
Acquiring Fund of the Reorganization, except for (i) such as may be required
under the Securities Act, the Exchange Act, the Investment Company Act, or
state securities laws (which term as used herein shall include the laws of the
District of Columbia and Puerto Rico), (ii) such actions as shall be necessary
to establish the Acquiring Funds, and (iii) if necessary, receipt of a Section
17 Order.

j. N-l4 Registration Statement. The N-14 Registration Statement, on its
effective date, at the time of the shareholders' meeting referred to in Section
5(a) hereof and on the Closing Date, insofar as it relates to the Acquiring
Fund (i) complied, or will comply, as the case may be, in all material
respects, with the applicable provisions of the Securities Act, the Exchange
Act and the Investment Company Act and the rules and regulations promulgated
thereunder, and (ii) did not, or will not, as the case may be, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were made, not misleading.

k. Capitalization. Under its Articles of Incorporation SunAmerica Strategic
Investment Series, Inc., is authorized to issue 1,000,000,000 full and
fractional shares of common stock, par value $0.0001 per share, of which
100,000,000 unissued shares have been designated as the Acquiring Fund and have
been divided into four classes, designated Class A, Class B, Class II and Class
I. All issued and outstanding shares of the Acquiring Fund, if any, are duly
authorized, validly issued, fully paid and non-assessable and free of
preemptive rights. Except for (i) the right of Class B shares of the Acquiring
Fund to automatically convert to Class A shares of the Acquiring Fund
approximately eight years after the purchase thereof or (ii) in connection with
any automatic dividend reinvestment plan available to the Acquiring Fund
shareholders, there are no options, warrants, subscriptions, calls or other
rights, agreements or commitments obligating the Acquiring Fund to issue any of
its shares or securities convertible into its shares.

l. Corresponding Shares.

i. The Corresponding Shares to be issued by the Acquiring Fund to the
Acquired Fund and subsequently distributed by the Acquired Fund to its
shareholders as provided in this Agreement will be duly and validly
authorized and, when issued and delivered pursuant to this Agreement, will
be legally and validly issued and will be fully paid and nonassessable and
will have full voting rights, and no shareholder of the Acquiring Fund will
have any preemptive right of subscription or purchase in respect thereof.

ii. At or prior to the Closing Date, the Corresponding Shares to be
issued by the Acquiring Fund to the Acquired Fund on the Closing Date will
be duly qualified for offering to the public in all states of the United
States in which the sale of shares of the Acquiring Fund presently are
qualified, and there are a sufficient number of such shares registered
under the Securities Act, the Investment Company Act and with each
pertinent state securities commission to permit the Reorganization to be
consummated.

5. Covenants of the Acquired Fund and the Acquiring Fund.

a. Special Shareholders' Meeting. The Acquired Fund agrees to call a special
meeting of its shareholders to be held as soon as practicable after the
effective date of the N-14 Registration Statement for the purpose of
considering the Reorganization as described in this Agreement and to take all
other action necessary to obtain shareholder approval of the transactions
contemplated herein.

b. Unaudited Financial Statements.

(i) The Acquired Fund hereby agrees to furnish or cause its agents to
furnish to the Acquiring Fund, at or prior to the Closing Date, for the
purpose of determining the number of Corresponding Shares to be issued by
the Acquiring Fund to the Acquired Fund pursuant to Section 2(c) hereof, an
accurate, correct and complete unaudited statement of assets and
liabilities of the Acquired Fund with values determined in accordance with
Section 2(c) hereof and an unaudited schedule of Investments of the
Acquired Fund (including the respective dates and costs of acquisition
thereof), each as of the Valuation Time. Such unaudited financial
statements will fairly present in all material respects the financial
position of the Acquired Fund as of the dates and for the periods referred
to therein and in conformity with generally accepted accounting principles
applied on a consistent basis.

(ii) The Acquiring Fund hereby agrees to furnish or cause its agents to
furnish to the Acquired Fund, at or prior to the Closing Date, for the
purpose of determining the number of Corresponding Shares to be issued by
the Acquiring Fund to the Acquired Fund pursuant to Section 2(c) hereof, an
accurate, correct and complete unaudited statement of assets and
liabilities of the Acquiring Fund with values determined in accordance with
Section 2(c) hereof and an unaudited schedule of Investments of the
Acquiring Fund (including the respective dates and costs of acquisition
thereof), each as of the Valuation Time. Such unaudited financial
statements will fairly present in all material respects the financial
position of the Acquiring Fund as of the dates and for the periods referred
to therein and in conformity with generally accepted accounting principles
applied on a consistent basis.

c. Share Ledger Records of the Acquiring Fund. The Acquiring Fund agrees, as
soon as practicable after the Valuation Time, to open shareholder accounts on
its share ledger records for the shareholders of the Acquired Fund in
connection with the distribution of Corresponding Shares by the Acquired Fund
to such shareholders in accordance with Section 2(d) hereof.

d. Conduct of Business. The Acquired Fund covenants and agrees to operate
its business in the ordinary course as presently conducted between the date
hereof and the Closing Date, it being understood that such ordinary course of
business will include customary dividends and distributions.

e. Termination of the Acquired Fund. North American Funds agrees that as
soon as practicable following the consummation of the Reorganization, it will
terminate the existence of the Acquired Fund in accordance with the laws of the
Commonwealth of Massachusetts and any other applicable law.

f. Filing of N-14 Registration Statement. SunAmerica Strategic Investment
Series, Inc., on behalf of the Acquiring Fund, will file or cause its agents to
file the N-14 Registration Statement with the Commission and will use its best
efforts to cause the N-14 Registration Statement to become effective as
promptly as practicable after the filing thereof. The Acquired Fund and the
Acquiring Fund agree to cooperate fully with each other, and each will furnish
to the other the information relating to itself to be set forth in the N-14
Registration Statement as required by the Securities Act, the Exchange Act, the
Investment Company Act, and the rules and regulations thereunder and the state
securities or blue sky laws (if applicable).

g. Corresponding Shares. The Acquired Fund will not sell or otherwise
dispose of any of the Corresponding Shares to be received by it from the
Acquiring Fund in connection with the Reorganization, except in distribution to
the shareholders of the Acquired Fund in accordance with the terms hereof.

h. Tax Returns. The Acquired Fund agrees that by the Closing Date all of its
Federal and other tax returns and reports required to be filed on or before
such date shall have been filed and all taxes shown as due on said returns
either shall have been paid or adequate liability reserves shall have been
provided for the payment of such taxes.

i. Combined Proxy Statement and Prospectus Mailing. The Acquired Fund agrees
to mail to its shareholders of record entitled to vote at the special meeting
of shareholders at which action is to be considered regarding this Agreement,
in sufficient time to comply with requirements as to notice thereof, a combined
Proxy Statement and Prospectus which complies in all material respects (except
as to information therein relating to the Acquiring Fund) with the applicable
provisions of Section 14(a) of the Exchange Act and Section 20(a) of the
Investment Company Act, and the rules and regulations promulgated thereunder.

j. Confirmation of Tax Basis. The Acquired Fund will deliver to the
Acquiring Fund on the Closing Date confirmations or other adequate evidence as
to the tax basis of each of the Assets delivered to the Acquiring Fund
hereunder.

k. Shareholder List. As soon as practicable after the close of business on
the Closing Date, the Acquired Fund shall deliver to the Acquiring Fund a list
of the names and addresses of all of the shareholders of record of the Acquired
Fund on the Closing Date and the number of shares of the Acquired Fund owned by
each such shareholder as of such date, certified to the best of its knowledge
and belief by the transfer agent or by North American Funds on behalf of the
Acquired Fund.

l. New Series. SunAmerica Strategic Investment Series, Inc., on behalf of
each Acquiring Fund, shall cause a post-effective amendment to its Registration
Statement on Form N-1A (the "Acquiring Fund Post-Effective Amendment") to be
filed with the Commission in a timely fashion to register the shares of the
Acquiring Fund for sale under the Securities Act prior to the Closing Date.

6. Closing Date.

The closing of the transactions contemplated by this Agreement shall be at
the offices of Shearman & Sterling, 599 Lexington Avenue, New York, NY 10022
after the close of the New York Stock Exchange on November 9, 2001, or at such
other place, time and date agreed to by the Acquired Fund and the Acquiring
Fund. The date and time upon which such closing is to take place shall be
referred to herein as the "Closing Date." To the extent that any Assets, for
any reason, are not transferable on the Closing Date, the Acquired Fund shall
cause such Assets to be transferred to the Acquiring Fund's custody account
with State Street Bank and Trust Company at the earliest practicable date
thereafter.

7. Conditions of the Acquired Fund.

The obligations of the Acquired Fund hereunder shall be subject to the
satisfaction, at or before the Closing Date (or such other date specified
herein), of the conditions set forth below. The benefit of these conditions is
for the Acquired Fund only and, other than with respect to the condition set
forth in Section 7(c) hereof, may be waived, in whole or in part, by the
Acquired Fund at any time in its sole discretion.

a. Representations and Warranties. The representations and warranties of the
Acquiring Fund made in this Agreement shall be true and correct in all material
respects when made, as of the Valuation Time and as of the Closing Date all
with the same effect as if made at and as of such dates, except that any
representations and warranties that relate to a particular date or period shall
be true and correct in all material respects as of such date or period.

b. Performance. The Acquiring Fund shall have performed, satisfied and
complied with all covenants, agreements and conditions required to be
performed, satisfied or complied with by it under this Agreement at or prior to
the Closing Date.

c. Shareholder Approval. This Agreement shall have been adopted, and the
Reorganization shall have been approved, by a Majority Shareholder Vote.

d. Approval of Board of Directors. This Agreement shall have been adopted
and the Reorganization shall have been approved by the Board of Directors of
SunAmerica Strategic Investment Series, Inc., on behalf of the Acquiring Fund,
including a majority of the Directors who are not "interested persons" of North
American Funds or SunAmerica Strategic Investment Series, Inc. as defined in
Section 2(a)(19) of the Investment Company Act, which shall have found, as
required by Rule 17a-8(a), that (i) participation in the Reorganization is in
the best interests of the Acquiring Fund and (ii) the interests of the existing
shareholders of the Acquiring Fund will not be diluted as a result of the
Reorganization.

e. Deliveries by the Acquiring Fund. At or prior to the Closing Date, the
Acquiring Fund shall deliver to the Acquired Fund the following:

i. a certificate, in form and substance reasonably satisfactory to the
Acquired Fund, executed by the President (or a Vice President) of
SunAmerica Strategic Investment Series, Inc. on behalf of the Acquiring
Fund, dated as of the Closing Date, certifying that the conditions
specified in Sections 7(a), (b), (d) and (f) have been fulfilled;

ii. the unaudited financial statements of the Acquiring Fund required by
Section 5(b)(ii) hereof; and

iii. an opinion of S&S, in form and substance reasonably satisfactory to
the Acquired Fund, to the effect that, for Federal income tax purposes, (i)
the transfer of the Assets to the Acquiring Fund in return solely for the
Corresponding Shares and the assumption by the Acquiring Fund of the
Assumed Liabilities as provided for in the Agreement will constitute a
reorganization within the meaning of Section 368(a) of the Code, and
assuming that such transfer, issuance and assumption qualifies as a
reorganization within the meaning of Section 368(a) of the Code, the
Acquired Fund and the Acquiring Fund will each be deemed to be a "party to
a reorganization" within the meaning of Section 368(b) of the Code; (ii) in
accordance with Sections 357 and 361 of the Code, no gain or loss will be
recognized to the Acquired Fund as a result of the Asset transfer solely in
return for the Corresponding Shares and the assumption by the Acquiring
Fund of the Assumed Liabilities or on the distribution (whether actual or
constructive) of the Corresponding Shares to the Acquired Fund shareholders
as provided for in the Agreement; (iii) under Section 1032 of the Code, no
gain or loss will be recognized to the Acquiring Fund on the receipt of the
Assets in return for the Corresponding Shares and the assumption by the
Acquiring Fund of the Assumed Liabilities as provided for in the Agreement;
(iv) in accordance with Section 354(a)(1) of the Code, no gain or loss will
be recognized to the shareholders of the Acquired Fund on the receipt
(whether actual or constructive) of Corresponding Shares in return for
their shares of the Acquired Fund; (v) in accordance with Section 362(b) of
the Code, the tax basis of the Assets in the hands of the Acquiring Fund
will be the same as the tax basis of such Assets in the hands of the
Acquired Fund immediately prior to the consummation of the Reorganization;
(vi) in accordance with Section 358 of the Code, immediately after the
Reorganization, the tax basis of the Corresponding Shares received (whether
actually or constructively) by the shareholders of the Acquired Fund in the
Reorganization will be equal, in the aggregate, to the tax basis of the
shares of the Acquired Fund surrendered in return therefor; (vii) in
accordance with Section 1223 of the Code, a shareholder's holding period
for the Corresponding Shares will be determined by including the period for
which such shareholder held the shares of the Acquired Fund exchanged
therefor, provided that the Acquired Fund shares were held as a capital
asset; (viii) in accordance with Section 1223 of the Code, the Acquiring
Fund's holding period with respect to the Assets acquired by it will
include the period for which such Assets were held by the Acquired Fund;
and (ix) in accordance with Section 381(a) of the Code and regulations
thereunder, the Acquiring Fund will succeed to and take into account
certain tax attributes of the Acquired Fund, subject to applicable
limitations, such as earnings and profits, capital loss carryovers and
method of accounting.

f. Absence of Litigation. There shall not be pending before any Governmental
Authority any material litigation with respect to the matters contemplated by
this Agreement.

g. Proceedings and Documents. All proceedings contemplated by this
Agreement, the Reorganization, and all of the other documents incident thereto,
shall be reasonably satisfactory to the Acquired Fund and its counsel, and the
Acquired Fund and its counsel shall have received all such counterpart
originals or certified or other copies of such documents as the Acquired Fund
or its counsel may reasonably request.

h. N-14 Registration Statement; Acquiring Fund Post-Effective Amendment. The
N-14 Registration Statement and Acquiring Fund Post-Effective Amendment each
shall have become effective under the Securities Act, and no stop order
suspending such effectiveness shall have been instituted or, to the knowledge
of the Acquiring Fund or the Acquired Fund, contemplated by the Commission.

i. Compliance with Laws; No Adverse Action or Decision. Since the date
hereof, (i) no law, statute, ordinance, code, rule or regulation shall have
been promulgated, enacted or entered that restrains, enjoins, prevents,
materially delays, prohibits or otherwise makes illegal the performance of this
Agreement, the Reorganization or the consummation of any of the transactions
contemplated hereby and thereby; (ii) the Commission shall not have issued an
unfavorable advisory report under Section 25(b) of the Investment Company Act,
nor instituted or threatened to institute any proceeding seeking to enjoin
consummation of the Reorganization under Section 25(c) of the Investment
Company Act, and (iii) no other legal, administrative or other proceeding shall
be instituted or threatened by any Governmental Authority which would
materially affect the financial condition of the Acquiring Fund or that seeks
to restrain, enjoin, prevent, materially delay, prohibit or otherwise make
illegal the performance of this Agreement, the Reorganization or the
consummation of any of the transactions contemplated hereby or thereby.

j. Commission Orders or Interpretations. The Acquired Fund shall have
received from the Commission such orders or interpretations, including a
Section 17 Order, as counsel to the Acquired Fund deems reasonably necessary or
desirable under the Securities Act and the Investment Company Act in connection
with the Reorganization; provided that such counsel shall have requested such
orders or interpretations as promptly as practicable, and all such orders shall
be in full force and effect.

8. Conditions of the Acquiring Fund.

The obligations of the Acquiring Fund hereunder shall be subject to the
satisfaction, at or before the Closing Date (or such other date specified
herein), of the conditions set forth below. The benefit of these conditions is
for the Acquiring Fund only and, other than with respect to the condition set
forth in Section 8(c) hereof, may be waived, in whole or in part, by the
Acquiring Fund at any time in its sole discretion.

a. Representations and Warranties. The representations and warranties of the
Acquired Fund made in this Agreement shall be true and correct in all material
respects when made, as of the Valuation Time and as of the Closing Date all
with the same effect as if made at and as of such dates, except that any
representations and warranties that relate to a particular date or period shall
be true and correct in all material respects as of such date or period.

b. Performance. The Acquired Fund shall have performed, satisfied and
complied with all covenants, agreements and conditions required to be
performed, satisfied or complied with by it under this Agreement at or prior to
the Closing Date.

c. Shareholder Approval. This Agreement shall have been adopted, and the
Reorganization shall have been approved, by a Majority Shareholder Vote.

d. Approval of Board of Trustees. This Agreement shall have been adopted and
the Reorganization shall have been approved by the Board of Trustees of North
American Funds, on behalf of the Acquired Fund, including a majority of the
Trustees who are not "interested persons" of North American Funds or SunAmerica
Strategic Investment Series, Inc. within the meaning of Section 2(a)(19) of the
Investment Company Act, which shall have found, as required by Rule 17a-8(a),
that (i) participation in the Reorganization is in the best interests of the
Acquired Fund and (ii) the interests of the existing shareholders of the
Acquired Fund will not be diluted as a result of the Reorganization.

e. Deliveries by the Acquired Fund. At or prior to the Closing Date, the
Acquired Fund shall deliver to the Acquiring Fund the following:

i. a certificate, in form and substance reasonably satisfactory to the
Acquiring Fund, executed by the President (or a Vice President) of North
American Funds on behalf of the Acquired Fund, dated as of the Closing
Date, certifying that the conditions specified in Sections 8(a), (b), (c),
(d) and (f) have been fulfilled;

ii. the unaudited financial statements of the Acquired Fund required by
Section 5(b)(i) hereof; and

iii. an opinion of S&S, in form and substance reasonably satisfactory to
the Acquiring Fund, with respect to the matters specified in Section
7(e)(iii) hereof.

f. No Material Adverse Change. There shall have occurred no material
adverse change in the financial position of the Acquired Fund since April 30,
2001 other than changes in its portfolio securities since that date, changes
in the market value of its portfolio securities or changes in connection with
the payment of the Acquired Fund's customary operating expenses, each in the
ordinary course of business. The Acquired Fund reserves the right to sell any
of its portfolio securities in the ordinary course of business, but will not,
without the prior written consent of the Acquiring Fund, acquire any
additional securities other than securities of the type in which the Acquiring
Fund is permitted to invest.

g. Absence of Litigation. There shall not be pending before any
Governmental Authority any material litigation with respect to the matters
contemplated by this Agreement.

h. Proceedings and Documents. All proceedings contemplated by this
Agreement, the Reorganization, and all of the other documents incident
thereto, shall be reasonably satisfactory to the Acquiring Fund and its
counsel, and the Acquiring Fund and its counsel shall have received all such
counterpart originals or certified or other copies of such documents as the
Acquiring Fund or its counsel may reasonably request.

i. N-14 Registration Statement; Acquiring Fund Post-Effective
Amendment. The N-14 Registration Statement and Acquiring Fund Post-Effective
Amendment each shall have become effective under the Securities Act, and no
stop order suspending such effectiveness shall have been instituted or, to the
knowledge of the Acquired Fund or the Acquiring Fund, contemplated by the
Commission.

j. Compliance with Laws; No Adverse Action or Decision. Since the date
hereof, (i) no law, statute, ordinance, code, rule or regulation shall have
been promulgated, enacted or entered that restrains, enjoins, prevents,
materially delays, prohibits or otherwise makes illegal the performance of
this Agreement, the Reorganization or the consummation of any of the
transactions contemplated hereby and thereby; (ii) the Commission shall not
have issued an unfavorable advisory report under Section 25(b) of the
Investment Company Act, nor instituted or threatened to institute any
proceeding seeking to enjoin consummation of the Reorganization under Section
25(c) of the Investment Company Act, and (iii) no other legal, administrative
or other proceeding shall be instituted or threatened by any Governmental
Authority which would materially affect the financial condition of the
Acquired Fund or that seeks to restrain, enjoin, prevent, materially delay,
prohibit or otherwise make illegal the performance of this Agreement, the
Reorganization or the consummation of any of the transactions contemplated
hereby or thereby.

k. Commission Orders or Interpretations. The Acquiring Fund shall have
received from the Commission such orders or interpretations, including a
Section 17 Order, as counsel to the Acquiring Fund, deems reasonably necessary
or desirable under the Securities Act and the Investment Company Act in
connection with the Reorganization; provided that such counsel shall have
requested such orders or interpretations as promptly as practicable, and all
such orders shall be in full force and effect.

l. [Intentionally Left Blank]

9. Termination, Postponement and Waivers.

a. Termination of Agreement. Notwithstanding anything contained in this
Agreement to the contrary, subject to Section 10 hereof, this Agreement may be
terminated and the Reorganization abandoned at any time (whether before or
after approval thereof by the shareholders of the Acquired Fund) prior to the
Closing Date, or the Closing Date may be postponed, by notice in writing prior
to the Closing Date:

i. by the Acquired Fund or the Acquiring Fund if:

(1) the Board of Trustees of North American Funds and the Board of
Directors of SunAmerica Strategic Investment Series, Inc. so mutually
agree in writing; or

(2) any Governmental Authority of competent jurisdiction shall have
issued any judgment, injunction, order, ruling or decree or taken any
other action restraining, enjoining or otherwise prohibiting this
Agreement, the Reorganization or the consummation of any of the
transactions contemplated hereby or thereby and such judgment,
injunction, order, ruling, decree or other action becomes final and
non-appealable; provided that the party seeking to terminate this
Agreement pursuant to this Section 9(a)(i)(3) shall have used its
reasonable best efforts to have such judgment, injunction, order,
ruling, decree or other action lifted, vacated or denied;

ii. by the Acquired Fund if any condition of the Acquired Fund's
obligations set forth in Section 7 of this Agreement has not been fulfilled
or waived by it; or

iii. by the Acquiring Fund if any condition of the Acquiring Fund's
obligations set forth in Section 8 of this Agreement has not been fulfilled
or waived by it.

b. Commission Order. If any order or orders of the Commission with respect
to this Agreement, the Reorganization or any of the transactions contemplated
hereby or thereby shall be issued prior to the Closing Date and shall impose
any terms or conditions which are determined by action of the Board of Trustees
of North American Funds and the Board of Directors of SunAmerica Strategic
Investment Series, Inc. to be acceptable, such terms and conditions shall be
binding as if a part of this Agreement without further vote or approval of the
shareholders of the Acquired Fund, unless such terms and conditions shall
result in a change in the method of computing the number of Corresponding
Shares to be issued by the Acquiring Fund to the Acquired Fund in which event,
unless such terms and conditions shall have been included in the proxy
solicitation materials furnished to the shareholders of the Acquired Fund prior
to the meeting at which the Reorganization shall have been approved, this
Agreement shall not be consummated and shall terminate unless the Acquired Fund
promptly shall call a special meeting of shareholders at which such conditions
so imposed shall be submitted for approval and the requisite approval of such
conditions shall be obtained.

c. Effect of Termination. In the event of termination of this Agreement
pursuant to the provisions hereof, the same shall become null and void and have
no further force or effect, and there shall not be any liability on the part of
either the Acquired Fund or the Acquiring Fund, North American Funds or
SunAmerica Strategic Investment Series, Inc., or Persons who are their
directors, trustees, officers, agents or shareholders in respect of this
Agreement.

d. Waivers; Non-Material Changes. At any time prior to the Closing Date, any
of the terms or conditions of this Agreement may be waived by the party that is
entitled to the benefit thereof if such action or waiver will not have a
material adverse effect on the benefits intended under this Agreement to the
shareholders of such party on behalf of which such action is taken. In
addition, each party has delegated to its investment adviser the ability to
make non-material changes to this Agreement if such investment adviser deems it
to be in the best interests of the Acquired Fund or Acquiring Fund for which it
serves as investment adviser to do so.

10. Survival of Representations and Warranties.

The respective representations and warranties contained in Sections 3 and 4
hereof shall expire with, and be terminated by, the consummation of the
Reorganization, and neither the Acquired Fund nor the Acquiring

Fund nor any of their officers, trustees, directors, agents or shareholders
shall have any liability with respect to such representations or warranties
after the Closing Date. This provision shall not protect any officer, trustee,
director or agent of the Acquired Fund or the Acquiring Fund, or of North
American Funds or SunAmerica Strategic Investment Series, Inc. against any
liability to the entity for which such Person serves in such capacity, or to
its shareholders, to which such Person would be subject by reason of willful
misfeasance, bad faith, gross negligence, or reckless disregard of the duties
in the conduct of such office.

11. Other Matters.

a. Obligations under Massachusetts Law. Copies of the North American Funds
Declaration of Trust are on file with the Secretary of State of the
Commonwealth of Massachusetts and notice is hereby given that this instrument
is executed on behalf of the Trustees of North American Funds on behalf of the
Acquired Fund, as trustees and not individually, and that the obligations of or
arising out of this instrument are not binding upon any of the trustees,
directors, officers, employees, agents or shareholders of North American Funds
individually, but are binding solely upon the assets and property of the
Acquired Fund.

b. Further Assurances. Each party hereto covenants and agrees to provide the
other party hereto and its agents and counsel with any and all documentation,
information, assistance and cooperation that may become necessary from time to
time with respect to the transactions contemplated by this Agreement.

c. Notices. Any notice, report or other communication hereunder shall be in
writing and shall be given to the Person entitled thereto by hand delivery,
prepaid certified mail or overnight service, addressed to the Acquired Fund or
the Acquiring Fund, as applicable, at the address set forth below. If the
notice is sent by certified mail, it shall be deemed to have been given to the
Person entitled thereto upon receipt and if the notice is sent by overnight
service, it shall be deemed to have been given to the Person entitled thereto
one (1) business day after it was deposited with the courier service for
delivery to that Person. Notice of any change in any address listed below also
shall be given in the manner set forth above. Whenever the giving of notice is
required, the giving of such notice may be waived by the party entitled to
receive such notice.

If to the Acquired Fund, to: North American Funds
286 Congress Street
Boston, MA 02210
Attention: Nori Gabert, Esq.

With a copy to: Sullivan & Worcester LLP
1025 Connecticut Avenue, N.W.
Suite 1000
Washington, DC 20036
Attention: David M. Leahy, Esq.

If to the Acquiring Fund, to: SunAmerican Strategic Investment
Series, Inc.
733 Third Avenue, Third Floor

New York, NY 10017

Attention: Robert M. Zakem, Esq.

With a copy to: Shearman & Sterling
599 Lexington Avenue
New York, New York 10022
Attention: Margery K. Neale, Esq.

d. Entire Agreement. This Agreement contains the entire agreement between
the parties hereto with respect to the matters contemplated herein and
supersedes all previous agreements or understandings between the parties
related to such matters.

e. Amendment. Except as set forth in Section 9(d) hereof, this Agreement may
be amended, modified, superseded, canceled, renewed or extended, and the terms
or covenants hereof may be waived, only by a written instrument executed by all
of the parties hereto or, in the case of a waiver, by the party waiving
compliance; provided that, following the meeting of shareholders of the
Acquired Fund pursuant to Section 5(a) hereof, no such amendment may have the
effect of changing the provisions for determining the number of Corresponding
Shares to be issued to the Acquired Fund shareholders under this Agreement to
the detriment of such shareholders without their further approval. Except as
otherwise specifically provided in this Agreement, no waiver by either party
hereto of any breach by the other party hereto of any condition or provision of
this Agreement to be performed by such other party shall be deemed a waiver of
a similar or dissimilar provision or condition at the same or at any prior or
subsequent time.

f. Governing Law. This Agreement shall be construed and enforced in
accordance with, and the rights of the parties shall be governed by, the laws
of the State of New York applicable to agreements made and to be performed in
said state, without giving effect to the principles of conflict of laws
thereof.

g. Assignment. This Agreement shall not be assigned by any of the parties
hereto, in whole or in part, whether by operation of law or otherwise, without
the prior written consent of the other party hereto. Any purported assignment
contrary to the terms hereof shall be null, void and of no effect. Nothing
herein expressed or implied is intended or shall be construed to confer upon or
give any person, firm, or corporation, other than the parties hereto and their
respective successors and assigns, any rights or remedies under or by reason of
this Agreement.

h. Costs of the Reorganization. All costs of the Reorganization shall be
borne by American International Group, Inc. or an affiliate thereof, regardless
of whether the Reorganization is consummated.

i. Severability. Any term or provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall, as to such jurisdiction, be
ineffective to the extent of such invalidity or unenforceability without
rendering invalid or unenforceable the remaining terms and provisions of this
Agreement or affecting the validity or enforceability of any of the terms and
provisions of this Agreement in any other jurisdiction.

j. Headings. Headings to sections in this Agreement are intended solely for
convenience and no provision of this Agreement is to be construed by reference
to the heading of any section.

k. Counterparts. This Agreement may be executed in any number of
counterparts, each of which, when executed and delivered, shall be deemed to be
an original but all such counterparts together shall constitute but one
instrument.

IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth above.

Attest: North American Funds on behalf of
Stock Index Fund

Science & Technology Fund

Aggressive Growth LifeStyle Fund
Moderate Growth LifeStyle Fund
Conservative Growth LifeStyle Fund

By: By:
--------------------------------- ---------------------------------
Name: Name:
Title: Title:

Attest: SunAmerica Strategic Investment
Series, Inc. on behalf of
SunAmerica Stock Index Fund

SunAmerica Science & Technology Fund

SunAmerica Aggressive Growth
LifeStage Fund
SunAmerica Moderate Growth LifeStage
Fund
SunAmerica Conservative Growth
LifeStage Fund

By: By:
--------------------------------- ---------------------------------
Name: Name:
Title: Title:

STATEMENT OF ADDITIONAL INFORMATION

SUNAMERICA STRATEGIC INVESTMENT SERIES, INC.
733 Third Avenue, Third Floor
New York, NY 10017

(800) 858-8850

----------------

This Statement of Additional Information is not a prospectus and should be
read in conjunction with the Proxy Statement and Prospectus (the "Proxy
Statement and Prospectus"), dated October 1, 2001, which has been filed by
SunAmerica Strategic Investment Series, Inc. (sometimes referred to herein as
the "Registrant"). Copies of the Proxy Statement and Prospectus may be obtained
at no charge by writing to the Registrant at the address indicated above or by
calling toll-free (800)-858-8850. This Statement of Additional Information has
been incorporated by reference into the Proxy Statement and Prospectus.

Unless otherwise indicated, capitalized terms used herein and not otherwise
defined have the same meanings as are given to them in the Proxy Statement and
Prospectus.

Further information about the Acquiring Funds is contained in the Acquiring
Funds' Prospectus and Statement of Additional Information, each dated February
28, 2001, as supplemented. Further information about the Acquired Funds is
contained in the Acquired Funds' Prospectuses and Statement of Additional
Information, each dated March 1, 2001, as supplemented, the Annual Report to
Shareholders of the Acquired Funds for the year ended October 31, 2000 and the
Semi-Annual Report to Shareholders of the Acquired Funds for the six months
ended April 30, 2001.

The following documents are incorporated herein by reference and accompany
this Statement of Additional Information:

. The Statement of Additional Information of the Acquiring Funds, dated
February 28, 2001, as supplemented.

. The Statement of Additional Information of the Acquired Funds, dated
March 1, 2001, as supplemented.

. The Annual Report to Shareholders of the Acquired Funds for the year
ended October 31, 2000.

. The Semi-Annual Report to Shareholders of the Acquired Funds for the six
months ended April 30, 2001.

The Securities and Exchange Commission maintains a web site
(http://www.sec.gov) that contains the prospectuses and statements of
additional information of the Funds, other material incorporated by reference
and other information regarding the Funds.

The date of this Statement of Additional Information is October 1, 2001.

B-1

TABLE OF CONTENTS

General Information......................................................... B-3
Financial Statements........................................................ B-4

B-2

GENERAL INFORMATION

The shareholders of each separate investment portfolio of North American
Funds, a Massachusetts business trust set forth below (each an "Acquired Fund,"
collectively, the "Acquired Funds"), are being asked to approve or disapprove
on behalf of each Acquired Fund (other than, in the case of the New Subadvisory
Agreement, the NAF Science & Technology Fund, which has a different subadviser
than the other Acquired Funds): (i) a new investment advisory agreement (the
"New Investment Advisory Agreement") between American General Asset Management
Corp. ("AGAM") and North American Funds, the terms of which are the same in all
material respects to the previous investment advisory agreement with AGAM, and
(ii) a new subadvisory agreement (the "New Subadvisory Agreement") between AGAM
and American General Investment Management, L.P. ("AGIM"), or an affiliate the
terms of which are the same in all material respects to the previous
subadvisory agreement with AGIM. In addition, shareholders of the Acquired
Funds are being asked to approve or disapprove an Agreement and Plan of
Reorganization (each, a "Plan") between each of the Acquired Funds and each
investment portfolio of SunAmerica Strategic Investment Series, Inc., a
Maryland corporation, set forth below (each, an "Acquiring Fund," and
collectively, the "Acquiring Funds").

Acquired Fund: Acquiring Fund:
-------------- ---------------

Stock Index Fund................ SunAmerica Stock Index Fund
Science & Technology Fund....... SunAmerica Science & Technology Fund
Aggressive Growth LifeStyle
Fund........................... SunAmerica Aggressive Growth LifeStage Fund
Moderate Growth LifeStyle Fund.. SunAmerica Moderate Growth LifeStage Fund
Conservative Growth LifeStyle
Fund........................... SunAmerica Conservative Growth LifeStage Fund

Each Plan provides for the acquisition by an Acquiring Fund of substantially
all of the assets, and assumption of substantially all of the liabilities, of
the respective Acquired Fund, solely in exchange for an equal aggregate value
of newly issued shares (the "Corresponding Shares") of such Acquiring Fund.
Each such transaction is referred to herein as a "Reorganization" and
collectively, as the "Reorganizations." Immediately thereafter, and as part of
the respective Reorganization, such Acquired Fund will distribute the
Corresponding Shares received in such Reorganization to its shareholders. The
consummation of one Reorganization is not conditioned upon the consummation of
any other Reorganization. The Acquired Funds and the Acquiring Funds are
sometimes collectively referred to herein as the "Funds."

Shareholders will receive the same class of Corresponding Shares as the
shares of the respective Acquired Fund held by them immediately prior to the
applicable Reorganization, although the name of the class may be different. For
example, if a shareholder owns Class C shares of an Acquired Fund, he or she
will receive Class II shares of the respective Acquiring Fund since the
Acquiring Funds do not have a class of shares called Class C. The aggregate net
asset value of the Corresponding Shares will equal the aggregate net asset
value of a shareholder's Acquired Fund shares. This means that a shareholder
may end up with a different number of shares compared to the number that he or
she originally held, but the total dollar value of the shares will be the same.

A Joint Special Meeting of the Acquired Funds' shareholders to consider the
New Investment Advisory Agreement, the New Subadvisory Agreement and the Plans
will be held at the principal executive offices of North American Funds, 286
Congress Street, Boston, Massachusetts 02210 on November 7, 2001, at 10 A.M.,
Eastern Time. The approximate mailing date of the Proxy Statement and
Prospectus is October 5, 2001.

For further information about the Reorganizations, see the Proxy Statement
and Prospectus.

B-3

FINANCIAL STATEMENTS

Unaudited Pro Forma financial statements reflecting consummation of the
Reorganizations are not included because each Acquiring Fund is a newly created
investment portfolio of SunAmerica Strategic Investment Series, Inc.

Acquired Funds

Audited financial statements and accompanying notes for the fiscal year
ended October 31, 2000 for the Acquired Funds and the independent auditor's
reports thereon are incorporated herein by reference from the Acquired Funds'
Annual Report to Shareholders, which accompanies this Statement of Additional
Information. Unaudited financial statements and accompanying notes for the six
months ended April 30, 2001 for the Acquired Funds are incorporated herein by
reference from the Acquired Funds' Semi-Annual Report to Shareholders, which
accompanies this Statement of Additional Information.

B-4

PART C

OTHER INFORMATION

ITEM 15. INDEMNIFICATION

Reference is made to Article VII of the Registrant's By-Laws which is set
forth below.

VII Indemnification of Directors, Officers, Employees And Agents

(a) The Registrant shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending, or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Registrant or any of its
shareholders) by reason of the fact that he is or was a Director, officer,
employee or agent of the Registrant. The indemnification shall be against
expenses, including attorneys' fees, judgments, fines and amounts paid in
settlement, actually and reasonably incurred by him in connection with the
action, suit or proceeding, if he acted in good faith and in a manner he
reasonably believed to be in or not opposed to the best interests of the
Registrant, and, with respect to any criminal action or proceedings, had no
reasonable cause to believe his conduct was unlawful. The termination of any
action, suit or proceeding by judgment, order, settlement, conviction or upon a
plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
Registrant, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.

(b) The Registrant shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or on behalf of the Registrant or any of its shareholders to obtain a
judgment or decree in its favor by reason of the fact that he is or was a
Director, officer, employee or agent of the Registrant. The indemnification
shall be against expenses, including attorneys' fees, actually and reasonably
incurred by him in connection with the defense or settlement of the action or
suit, if acted in good faith and in a manner he reasonably believed to be in or
not opposed to the best interests of the Registrant; except that such
indemnification shall preclude payment upon any liability, whether or not there
is an adjudication of liability, arising by reason of willful misfeasance, bad
faith, gross negligence, or reckless disregard of duties as described in
Section 17(h) and (i) of the Investment Company Act of 1940 (the "Investment
Company Act").

(c) To the extent that a Director, officer, employee or agent of the
Registrant has been successful on the merits or otherwise in defense of any
action, suit or proceeding referred to in subsections (a) or (b) or in defense
of any claim, issue or matter therein, he shall be indemnified against
expenses, including attorneys' fees, actually and reasonably incurred by him in
connection therewith.

(d) (1) Unless a court orders otherwise, any indemnification under
subsections (a) or (b) above may be made by the Registrant only as authorized
in the specific case after a determination that indemnification of the
Director, officer, employee or agent is proper in the circumstances because he
has met the applicable standard of conduct set forth in subsections (a) or (b).

(2) The determination shall be made:

(i) by the Directors, by a majority vote of a quorum which consists
of Directors who were not parties to the action, suit or proceeding; or

(ii) if the required quorum is not obtainable, or if a quorum of
disinterested Directors so directs, by independent legal counsel in a
written opinion; or

(iii) by the Shareholders.

C-1

(3) Notwithstanding the provisions of Article VII of the Registrant's
By-Laws, no person shall be entitled to indemnification for any liability,
whether or not there is an adjudication of liability, arising by reason of
willful malfeasance, bad faith, gross negligence or reckless disregard of
duties as described in Section 17(h) and (i) of the Investment Company Act
("Disabling Conduct"). A person shall be deemed not liable by reason of
Disabling Conduct if, either:

(i) a final decision on the merits is made by a court or other body
before whom the proceeding was brought that the person to be
indemnified ("Indemnitee") was not liable by reason of Disabling
Conduct; or

(ii) in the absence of such a decision, a reasonable determination,
based upon a review of the facts, that the Indemnitee was not liable by
reason of Disabling Conduct, is made by either:

(A) a majority of a quorum of Directors who are neither
"interested persons" of the Registrant, as defined in section
2(a)(19) of the Investment Company Act, nor parties to the action,
suit or proceeding;

(B) an independent legal counsel in a written opinion.

(e) Expenses, including attorneys' fees, incurred by a Director, officer,
employee or agent of the Registrant in defending a civil or criminal action,
suit or proceeding may be paid by the Registrant in advance of the final
disposition thereof if:

(1) authorized in the specific case by the Directors; and

(2) the Registrant receives an undertaking by or on behalf of the
Director, officer, employee or agent of the Registrant to repay the advance
if it is not ultimately determined that such person is entitled to be
indemnified by the Registrant; and

(3) either,

(i) such person provides a security for his undertaking; or

(ii) the Registrant is insured against losses by reason of any
lawful advances; or

(iii) a determination, based on a review or readily available facts,
that there is reason to believe that such person ultimately will be
found entitled to indemnification, is made by either

(A) A majority of a quorum which consists of Directors who are
neither "interested persons" of the Registrant, as defined in
section 2(a)(19) of the Investment Company Act, nor parties to the
action, suit or proceeding; or

(B) an independent legal counsel in a written opinion.

(f) The indemnification provided by Article VII of the Registrant's By-Laws
shall not be deemed exclusive of any other rights to which a person may be
entitled under any by-law, agreement, vote of Shareholders or disinterested
Directors or otherwise, both as to action in his official capacity and as to
action in another application while holding office, and shall continue as to a
person who has ceased to be a Director, officer, employee or agent and inure to
the benefit of the heirs, executors and administrators of such person; provided
that no person may satisfy any right of indemnity or reimbursement granted
herein or to which he may be otherwise entitled except out of the property of
the Registrant, and no Shareholder, as such, shall be personally liable with
respect to any claim for indemnity or reimbursement or otherwise.

(g) The Registrant may purchase and maintain insurance on behalf of any
person who is or was a Director, officer, employee or agent of the Registrant,
against any liability asserted against him and incurred by him in any such
capacity, or arising out of his status as such. However, in no event will the
Registrant pay that portion of insurance premiums, if any, attributable to
coverage which would indemnify any officer or Director against liability for
Disabling Conduct.

C-2

(h) Nothing contained in Section 7.01 of the Registrant's By-laws shall be
construed to protect any Director or officer of the Registrant against any
liability to the Registrant or to its security holders to which he would
otherwise be subject by reason of willful misfeasance, bad faith, gross
negligence or reckless disregard of the duties involved in the conduct of his
office.

Reference is made to Section 8 of the Registrant's Articles of Incorporation
which provides that Directors shall provide for indemnification by the
Registrant of any person who is, or has been a Director, officer, employee or
agent of the Registrant against all liability and against all expenses
reasonably incurred or paid by him in connection with any claim, action, suit
or proceeding in which he becomes involved as a party or otherwise by virtue of
his being or having been a Director, officer, employee or agent and against
amounts paid or incurred by him in the settlement thereof, in such manner as
the Directors may provide from time to time in the By-Laws of the Registrant.

The words "claim," "action," "suit" or "proceeding" shall apply to all
claims, actions, suits or proceedings (civil, criminal or other, including
appeals), actual or threatened; and the words "liability" and "expenses" shall
include, without limitation, attorneys' fees, costs, judgments, amounts paid in
settlement, fines, penalties and other liabilities.

Reference is made to Section 5 of the Distribution Agreement (the
"Distribution Agreement") between SunAmerica Capital Services, Inc. (the
"Distributor") and the Registrant which is set forth below:

(a) The Registrant will indemnify and hold harmless the Distributor and each
person, if any, who controls the Distributor within the meaning of the
Investment Company Act against any losses, claims, damages or liabilities to
which the Distributor or such controlling person may become subject, under the
Investment Company Act or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in
the Registrant's Registration Statement, Prospectus or Statement of Additional
Information or any other written sales material prepared by the Registrant or
the separate investment portfolios of the Registrant (the "Funds") which is
utilized by the Distributor in connection with the sale of shares of beneficial
interest of a Fund (the "Shares") or arise out of or are based upon the
omission or alleged omission to state therein a material fact required to be
stated therein or (in the case of the Registrant's Registration Statement,
Prospectus and Statement of Additional Information) necessary to make the
statement therein not misleading or (in the case of such other sales material)
necessary to make the statements therein not misleading in the light of the
circumstances under which they were made; and will reimburse the Distributor
and each such controlling person for any legal or other expenses reasonably
incurred by the Distributor or such controlling person in connection with
investigating or defending any such loss, claim, damage, liability or action;
provided, however, that the Registrant or the Funds will not be liable in any
such case to the extent that any such loss, claim, damage or liability arises
out of or is based upon any untrue statement or alleged untrue statement or
omission or alleged omission made in such Registration Statement, Prospectus or
Statement of Additional Information in conformity with written information
furnished to the Registrant by the Distributor specifically for use therein;
and provided, further, that nothing in the Distribution Agreement shall be so
construed as to protect the Distributor against any liability to the Registrant
or the Funds, or the security holders of the Funds to which the Distributor
would otherwise be subject by reason of Disabling Conduct. This indemnity
provision will be in addition to any liability which the Registrant may
otherwise have.

(b) The Distributor will indemnify and hold harmless the Registrant, each of
its Directors and officers and each person, if any, who controls the Registrant
within the meaning of the Investment Company Act, against any losses, claims,
damages or liabilities to which the Registrant or any such Director, officer or
controlling person may become subject under the Investment Company Act or
otherwise, insofar as such losses, claims, damages or liabilities (or actions
in respect thereof) arise out of or are based upon any untrue statement or
alleged untrue statement of a material fact contained in the Registrant's
Registration Statement, Prospectus or Statement of Additional Information or
any sales material not prepared by the Registrant or the Funds which is

C-3

utilized in connection with the sale of the Shares or arise out of or are based
upon the omissions or the alleged omission to state therein a material fact
required to be stated therein or (in the case of the Registrant's Registration
Statement, Prospectus and Statement of Additional Information) necessary to
make the statement therein not misleading or (in the case of such other sales
material) necessary to make the statement therein not misleading in the light
of the circumstances under which they were made, in the case of the
Registrant's Registration Statement, Prospectus and Statement of Additional
Information to the extent, but only to the extent, that such untrue statement
or alleged untrue statement or omission or alleged omission was made in
conformity with written information furnished to the Registrant by the
Distributor specifically for use therein; and the Distributor will reimburse
any legal or other expenses reasonably incurred by the Registrant or any such
Director, officer or controlling person in connection with investigating or
defending any such loss, claim, damage, liability or action. This indemnity
provision will be in addition to any liability which the Distributor may
otherwise have.

Reference is made to Section 7 of the Investment Advisory and Management
Agreement (the "Advisory Agreement") between the Registrant and SunAmerica
Asset Management Corp. ("SAAMCo") which is set forth below.

7. Liability of Adviser. In the absence of Disabling Conduct on the part of
SAAMCo (and its officers, directors, agents, employees, controlling persons,
shareholders and any other person or entity affiliated with SAAMCo), SAAMCo
shall not be subject to liability to the Registrant or to any shareholder of
the Registrant for any act or omission in the course of, or connected with,
rendering services under the Advisory Agreement, including without limitation,
any error of judgment or mistake of law or for any loss suffered by any of them
in connection with the matters to which the Advisory Agreement relates, except
to the extent specified in Section 36(b) of the Investment Company Act
concerning loss resulting from a breach of fiduciary duty with respect to the
receipt of compensation for services. Except for such Disabling Conduct, the
Registrant shall indemnify SAAMCo (and its officers, directors, partners,
agents, employees, controlling persons, shareholders and any other person or
entity affiliated with SAAMCo) (collectively, the "Indemnified Parties") from
any liability arising from SAAMCo's conduct under the Advisory Agreement.

Indemnification to SAAMCo or any of its personnel or affiliates shall be
made when (i) a final decision on the merits rendered, by a court or other body
before whom the proceeding was brought, that the person to be indemnified was
not liable by reason of Disabling Conduct or, (ii) in the absence of such a
decision, a reasonable determination, based upon a review of the facts, that
the person to be indemnified was not liable by reason of Disabling Conduct, by
(a) the vote of a majority of a quorum of the Directors who are neither
"interested persons" of the Registrant as defined in section 2(a)(19) of the
Investment Company Act nor parties to the proceeding ("disinterested, non-party
Directors") or (b) an independent legal counsel in a written opinion. The
Registrant may, by vote of a majority of the disinterested, non-party Directors
advance attorneys' fees or other expenses incurred by an Indemnified Party in
defending a proceeding upon the undertaking by or on behalf of the Indemnified
Party to repay the advance unless it is ultimately determined that he is
entitled to indemnification. Such advance shall be subject to at least one of
the following: (1) the person to be indemnified shall provide a security for
his undertaking, (2) the Registrant shall be insured against losses arising by
reason of any lawful advances, or (3) a majority of a quorum of the
disinterested, non-party Directors or an independent legal counsel in a written
opinion, shall determine, based on a review of readily available facts, that
there is reason to believe that the person to be indemnified ultimately will be
found entitled to indemnification.

Insofar as indemnification for liabilities arising under the Securities Act
of 1933, as amended (the "Securities Act") may be permitted to Directors,
officers and controlling persons of the Registrant and the principal
underwriter pursuant to the foregoing provisions or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Securities
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
Registrant of expenses incurred or paid by a Director,

C-4

officer, or controlling person of the Registrant and the principal underwriter
in connection with the successful defense of any action, suit or proceeding) is
asserted by such Director, officer or controlling person or the principal
underwriter in connection with the shares being registered, the Registrant
will, unless in the opinion of its counsel the matter has been settled by
controlling precedent, submit to a court of appropriate jurisdiction the
question whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final adjudication
of such issue.

C-5

ITEM 16: EXHIBITS.

Exhibit No.
-----------

(1) (a) Articles of Incorporation of Registrant. Incorporated by
reference to Exhibit (a) to the Registrant's initial
Registration Statement on Form N-1A, filed on December 22,
1998.
(b) Articles Supplementary dated June 7, 2000.***
(c) Articles Supplementary dated September 27, 2001. (1)

(2) By-Laws of Registrant.*

(3) Not applicable.

(4) Form of Agreement and Plan of Reorganization. Filed herewith as
Exhibit II to the Proxy Statement and Prospectus contained in this
Registration Statement.

(5) Instruments Defining Rights of Shareholders. Incorporated by
reference to Exhibits (1) and (2) above.

(6) (a) Investment Advisory and Management Agreement between the
Registrant and SunAmerica Asset Management Corp. ("SAAMCo").**
(b) Subadvisory Agreement between the Registrant and J.P. Morgan
Investment Management, Inc. ("J.P. Morgan").*

(7) (a) Distribution Agreement between the Registrant and SunAmerica
Capital Services, Inc.*
(b) [Form of] Selling Agreement.*

(8) Disinterested Directors Retirement Plan.*

(9) Custodian Contract between the Registrant and State Street Bank
and Trust Company.*

(10) (a) Distribution Plan pursuant to Rule 12b-1 (Class A Shares).**
(b) Distribution Plan pursuant to Rule 12b-1 (Class B Shares).**
(c) Distribution Plan pursuant to Rule 12b-1 (Class II Shares).**
(d) Rule 18f-3 Plan.*

(11) Opinion and Consent of Robert M. Zakem, Esq. (1)

(12) (a) Opinion and consent of Shearman & Sterling, counsel to the
Registrant, regarding certain tax matters relating to the
Reorganization between the Stock Index Fund of North American
Funds and the SunAmerica Stock Index Fund of SunAmerica
Strategic Investment Series, Inc. (2)
(b) Opinion and consent of Shearman & Sterling, counsel to the
Registrant, regarding certain tax matters relating to the
Reorganization between the Science & Technology Fund of North
American Funds and the SunAmerica Science & Technology Fund of
SunAmerica Strategic Investment Series, Inc. (2)
(c) Opinion and consent of Shearman & Sterling counsel to the
Registrant, regarding certain tax matters relating to the
Reorganization between the Aggressive Growth LifeStyle Fund of
North American Funds and the SunAmerica Aggressive Growth
LifeStage Fund of SunAmerica Strategic Investment Series, Inc.
(2)
(d) Opinion and consent of Shearman & Sterling, counsel to the
Registrant, regarding certain tax matters relating to the
Reorganization between the Moderate Growth LifeStyle Fund of
North American Funds and the SunAmerica Moderate Growth
LifeStage Fund of SunAmerica Strategic Investment Series, Inc.
(2)

C-6

Exhibit No.
-----------

(e) Opinion and consent of Shearman & Sterling, counsel to the
Registrant, regarding certain tax matters relating to the
Reorganization between the Conservative Growth LifeStyle Fund
of North American Funds and the SunAmerica Conservative Growth
LifeStage Fund of SunAmerica Strategic Investment Series, Inc.
(2)

(13) (a) Transfer Agency and Service Agreement between the Registrant
and State Street Bank and Trust Company.*
(b) Service Agreement between the Registrant and SunAmerica Fund
Services, Inc.*

(14) (a) Consent of PricewaterhouseCoopers LLP. (1)
(b) Consent of Ernst & Young LLP. (1)

(15) Not Applicable.

(16) Power of Attorney. (1)

(17) (a) Prospectuses, dated February 28, 2001, of SunAmerica Strategic
Investment Series, Inc. as supplemented (Class A shares, Class
B shares, Class II shares and Class I shares).***
(b) Prospectus dated March 1, 2001 of North American Funds (Class
A shares, Class B shares and Class C shares).*****
(c) Prospectus dated March 1, 2001 of North American Funds
(Institutional Class I shares.*****
(d) Statement of Additional Information, dated February 28, 2001,
of SunAmerica Strategic Investment Series, Inc. as
supplemented.***
(e) Statement of Additional Information dated March 1, 2001 of
North American Funds.*****
(f) Semi-Annual Report to Shareholders of North American Funds for
the six-month period ended April 30, 2001.******
(g) Annual Report to Shareholders of North American Funds for the
year ended October 31, 2000.*******
(h) President's Letter. (1)
(i) Q&A. (1)
(j) Forms of Proxy Cards. (1)
(k) Form of Investment Advisory Agreement between North American
Funds and American General Asset Management Corp. (filed
herewith as Exhibit IA to the Proxy Statement and Prospectus
contained in this Registration Statement).
(l) Form of Subadvisory Agreement between American General Asset
Management Corp. and American General Investment Management,
L.P. or an affiliate thereof (filed herewith as Exhibit IB to
the Proxy Statement and Prospectus contained in this
Registration Statement).

--------
(1) Filed herewith.

(2) To be filed by amendment.

* Incorporated herein by reference to identically numbered Exhibit of the
Registrant's Post-Effective Amendment #1 to Registration Statement on
Form N-1A (File No. 333-69517), filed on February 26, 1999.
** Incorporated herein by reference to identically numbered Exhibit of the
Registrant's Post-Effective Amendment #4 to Registration Statement on
Form N-1A (File No. 333-69517), filed on June 14, 2000.
*** Incorporated herein by reference to identically numbered Exhibit of the
Registrant's Post-Effective Amendment #5 to Registration Statement on
Form N-1A (File No. 333-69517), filed on February 28, 2001.

**** Intentionally omitted.

***** Incorporated by reference to North American Funds' Post-Effective
Amendment #35 to Registration Statement on Form N-1A (File No. 333-
27958), filed on March 1, 2001.
****** Incorporated by reference to North American Funds' Form N-30D (File No.
333-27958), filed on July 3, 2001.
******* Incorporated by reference to North American Funds' Form N-30D (File No.
333-27958), filed on January 17, 2001.

C-7

ITEM 17. UNDERTAKINGS.

(a) The undersigned Registrant agrees to prior to any public reoffering of
the securities registered through the use of a prospectus which is a part of
this Registration Statement by any person or party who is deemed to be an
underwriter within the meaning of Rule 145(c) of the Securities Act, the
reoffering prospectus will contain the information called for by the applicable
registration form for reofferings by persons who may be deemed underwriters, in
addition to the information called for by the other items of the applicable
form.

(b) The undersigned Registrant agrees that every prospectus that is filed
under paragraph (a) above will be filed as part of an amendment to the
Registration Statement and will not be used until the amendment is effective,
and that, in determining any liability under the Securities Act, each post-
effective amendment shall be deemed to be a new registration statement for the
securities offered therein, and the offering of the securities at that time
shall be deemed to be the initial bona fide offering of them.

(c) The undersigned Registrant undertakes to file, by post-effective
amendment, the opinion of counsel received as to certain tax matters, within a
reasonable time after receipt of such opinion.

C-8

SIGNATURES

As required by the Securities Act of 1933, this Pre-Effective Amendment No.
1 to the Registration Statement has been signed on behalf of the Registrant, in
the city of New York, and State of New York, on the 28th day of September,
2001.

Sunamerica Strategic Investment
Series, Inc.
(Registrant)

By: /s/ Peter A. Harbeck

---------------------------------
Peter A. Harbeck,

President and Director

As required by the Securities Act of 1933, this Registration Statement has
been signed by the following persons in the capacities and on the dates
indicated.

Signature Title Date
--------- ----- ----

/s/ Peter A. Harbeck President and Director September 28, 2001
-------------------------------------- (Principal Executive
Peter A. Harbeck Officer)

* Treasurer (Principal
-------------------------------------- Financial and Accounting
Peter C. Sutton Officer)

* Director
--------------------------------------
S. James Coppersmith

* Director
--------------------------------------
Samuel M. Eisenstat

* Director
--------------------------------------
Stephen J. Gutman

* Director
--------------------------------------
Sebastiano Sterpa

*By: /s/ Peter A. Harbeck September 28, 2001
---------------------------------
(Peter A. Harbeck, Attorney-in-Fact)

C-9

EXHIBIT INDEX

Exhibit No.
-----------

1. (c)Articles Supplementary dated September 27, 2001.

11. Opinion and Consent of Robert M. Zakem, Esq.

14. (a)Consents of PricewaterhouseCoopers LLP.
(b)Consent of Ernst & Young LLP.

16. Power of Attorney.

17. (h)President's Letter.
(i)Q&A.
(j) Forms of Proxy Cards.