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

Securities Act File No. 333-67856

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

(Check appropriate box or boxes)

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SUNAMERICA MONEY MARKET FUNDS, 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)

----------------

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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Copies 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: Common stock, par value $.001 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

Money Market Fund
Municipal Money Market Fund
286 Congress Street
Boston, Massachusetts 02210

----------------

NOTICE OF JOINT SPECIAL MEETING OF SHAREHOLDERS

----------------

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 Money Market Fund (the "NAF Money Market Fund") and Municipal
Money Market Fund (the "NAF Municipal Money Market Fund," and together with the
NAF Money Market Fund, the "Acquired Funds") of North American Funds will be
held at the principal executive offices of North American Funds, 286 Congress
Street, Boston, MA 02210 on November 7, 2001 at 10:00 a.m. Eastern Time, for
the following purposes:

(1) (a) Both 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 as the previous investment advisory agreement with
AGAM;

(b) Both Acquired Funds: to approve or disapprove a 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 Money Market Fund: to approve or disapprove an Agreement and
Plan of Reorganization (the "Money Market Agreement and Plan") providing
for the acquisition of substantially all of the assets, and assumption of
substantially all of the liabilities, of the NAF Money Market Fund by the
SunAmerica Money Market Fund (the "SunAmerica Money Market Fund" or an
"Acquiring Fund") of SunAmerica Money Market Funds, Inc., solely in
exchange for an equal aggregate value of newly issued shares of the
SunAmerica Money Market Fund, as described in the accompanying proxy
statement and prospectus. The Money Market Agreement and Plan also provides
for distribution of the shares of the SunAmerica Money Market Fund to
shareholders of the NAF Money Market Fund. A vote in favor of this proposal
will constitute a vote in favor of the termination of the NAF Money Market
Fund as a separate investment portfolio of North American Funds;

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

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JOINT SPECIAL MEETING OF SHAREHOLDERS OF
MONEY MARKET FUND
AND
MUNICIPAL MONEY MARKET FUND
OF
NORTH AMERICAN FUNDS

----------------

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") and (ii) a new subadvisory agreement with 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 are the same in all material respects as your Fund's
previous investment advisory agreement with AGAM, and the terms of the new
subadvisory agreement are the same in all material respects as your Fund's
previous subadvisory agreement between AGAM and 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
into a comparable portfolio of SunAmerica Money Market Funds, 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
--------- ---------------

Money Market Fund SunAmerica Money Market Fund
Municipal Money Market
Fund SunAmerica Municipal Money Market Fund

This Proxy Statement and Prospectus serves as a prospectus of SunAmerica
Money Market Funds, 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.

Both North American Funds and SunAmerica Money Market Funds, Inc. are open-
end series management investment companies. North American Funds is organized
as a Massachusetts business trust and SunAmerica Money Market Funds, Inc. is
organized as a Maryland corporation. The SunAmerica Municipal Money Market Fund
is newly created and has not yet commenced operations.

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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.

This Proxy Statement and Prospectus sets forth concisely the information
about SunAmerica Money Market Funds, 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 documents are included in the package of documents that you
received with this Proxy Statement and Prospectus:

. The prospectus relating to SunAmerica Money Market Funds, Inc., dated
April 30, 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).

. The Annual Report to Shareholders of SunAmerica Money Market Funds, Inc.
for the year ended December 31, 2000, and the Semi-Annual Report to
Shareholders of SunAmerica Money Market Funds, Inc. for the six month
period ended June 30, 2001. These documents are 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 numbers set forth below or by writing North American Funds or SunAmerica
Money Market Funds, Inc. at the addresses 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 If they relate to SunAmerica Money Market Funds,
North American Funds: Inc.:

North American Funds SunAmerica Money Market Funds, 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 Money
Market Funds, Inc., dated April 30, 2001, as supplemented (the "Acquiring
Funds Statement").

. The preliminary prospectus relating to SunAmerica Money Market Funds,
Inc., subject to completion and dated August 14, 2001, as supplemented.

. The preliminary statement of additional information of SunAmerica Money
Market Funds, Inc., subject to completion and dated August 14, 2001, as
supplemented.

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

. 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 Money Market
Funds, 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 and
2b of this Proxy Statement and Prospectus are outlined in the following table:

Proposal Fund
-------- ----

1. (a) Approval of New Investment Both North American Funds referenced
Advisory Agreement above, each voting separately
(b) Approval of New Subadvisory Both North American Funds referenced
Agreement above, each voting separately
2. (a) Approval of Agreement and Plan of Money Market Fund
Reorganization relating to Money
Market Fund
(b) Approval of Agreement and Plan of Municipal Money Market Fund
Reorganization relating to
Municipal Money Market Fund

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TABLE OF CONTENTS

Page
----

INTRODUCTION............................................................. 2

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 Reorganization......................................... 4
FEE TABLES AND EXAMPLES.................................................. 6
THE FUNDS................................................................ 13
Business of the Acquired Funds......................................... 13
Business of the Acquiring Funds........................................ 13
Comparison of the Funds................................................ 13

PRINCIPAL RISK FACTORS AND SPECIAL CONSIDERATIONS........................ 17
PRINCIPAL RISKS OF INVESTING IN THE FUNDS................................ 17

PROPOSALS NOS. 1(a)-(b): APPROVAL OF THE NEW INVESTMENT ADVISORY
AGREEMENT AND THE NEW SUBADVISORY AGREEMENT.............................. 18
THE AIG MERGER AND THE NEW INVESTMENT ADVISORY AND SUBADVISORY
AGREEMENTS............................................................... 18
Board Considerations................................................... 18

PROPOSAL NO. 1(a) NEW INVESTMENT ADVISORY AGREEMENT...................... 20
Description of the New Investment Advisory Agreement................... 20
Additional Information About AGAM...................................... 20

PROPOSAL NO. 1(b) NEW SUBADVISORY AGREEMENT.............................. 23
Description of the New Subadvisory Agreement........................... 23
Additional Information About AGIM...................................... 24

PROPOSALS NOS. 2(a)-(b): APPROVAL OF THE PLANS........................... 25

COMPARISON OF THE FUNDS.................................................. 25
Directors and Officers................................................. 25
Management Arrangements................................................ 28
Distribution and Shareholder Servicing Arrangements.................... 30
Other Service Agreements with Affiliates............................... 31
Purchase, Exchange and Redemption of Shares............................ 32
Performance............................................................ 36
Shareholder Rights..................................................... 37
Tax Information........................................................ 37
Portfolio Transactions................................................. 38
Portfolio Turnover..................................................... 38
Additional Information................................................. 38

THE REORGANIZATIONS...................................................... 40
General................................................................ 40
Terms of the Plans..................................................... 40
NAF Board Considerations: Potential Benefits to Shareholders as a
Result of the Reorganizations......................................... 42
Federal Income Tax Consequences of the Reorganizations................. 44
Capitalization......................................................... 45

GENERAL.................................................................. 46

Page
----

INFORMATION CONCERNING THE MEETING........................................ 46
Date, Time and Place of Meeting......................................... 46
Solicitation, Revocation and Use of Proxies............................. 46
Record Date and Outstanding Shares...................................... 46
Security Ownership of Certain Beneficial Owners and Management of the
Funds.................................................................. 47
Voting Rights and Required Vote......................................... 48

ADDITIONAL INFORMATION.................................................... 49

LEGAL PROCEEDINGS......................................................... 49

LEGAL OPINIONS............................................................ 50

EXPERTS................................................................... 50

SHAREHOLDER PROPOSALS..................................................... 50

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, MA
02210 on November 7, 2001, at 10:00 a.m., Eastern Time. The mailing address
for 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 Money Market Funds, Inc.
that is acquiring a comparable portfolio of North American Funds.

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

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

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

Money Market Combined Fund: The SunAmerica Money Market Fund after the
Reorganization.

Money Market Funds: The Money Market Fund of North American Funds and
the SunAmerica Money Market Fund.

Municipal Money Market Combined Fund: The SunAmerica Municipal Money
Market Fund after the Reorganization.

Municipal Money Market Funds: The Municipal Money Market Fund of North
American Funds and the SunAmerica Municipal Money Market Fund.

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.

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 approval of a new subadvisory
agreement (the "New Subadvisory Agreement") between AGAM and New AGIM, to allow
them to continue to serve your Fund after the AIG Merger. The New Investment
Advisory and New Subadvisory Agreements are collectively referred to as the
"New Agreements." 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 (the "Previous
Subadvisory Agreement"). See "Proposal No. 1(a): New Investment Advisory
Agreement--Description 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): The New Subadvisory
Agreement--Description 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 Investment Advisory and New
Subadvisory 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 and New AGIM. 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 member 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 Fund 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 AGIM or an 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 a part of 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, if any, 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.

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). Although,
as a result of the Reorganizations, a shareholder of the Combined Fund may
receive Corresponding Shares which represent a smaller percentage of ownership
in the respective Acquiring Fund than he or she held in the Acquired Fund prior
to the respective Reorganization, the total dollar value of the shares will
remain the same; in addition, an Acquired Fund shareholder should end up with
the same number of shares because the Funds all seek to maintain a price per
share of $1.00. 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
investment objective and similar investment techniques;

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

.fee waivers and expense reimbursements currently in place and the
possibility of their termination;

.potential benefits to shareholders likely to result from each
Reorganization, such as allowing Class A shareholders to avoid sales
charges on exchanges and to "tack" their holding periods for purposes of
Class B exchanges and contingent deferred sales charge calculations; 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)-(b): Approval of the
Plans--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, and New AGIM will continue to serve as subadviser, of
the Acquired Funds 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, and New AGIM will serve as
subadviser to the Municipal Money Market 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 Money Market Funds, 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 December 31, 2000) and Pro Forma Fee Table for each
of the Combined Funds

(as of June 30, 2001)*

Class A Shares Class B Shares Class C/Class II Shares
--------------------------- --------------------------- ---------------------------
Actual Pro Forma Actual Pro Forma Actual Pro Forma
----------------- --------- ----------------- --------- ----------------- ---------
NAF SunAmerica Money NAF SunAmerica Money NAF SunAmerica Money
Money Money Market Money Money Market Money Money Market
Market Market Combined Market Market Combined Market Market 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... None None None 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) (1)....... None None None None 5.00% 5.00% None 1.00% 1.00%
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None None None None None None None None None
Redemption Fee
(2).............. 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............ 0.20% 0.48% 0.48% 0.20% 0.48% 0.48% 0.20% 0.48% 0.48%
Distribution
and/or Service
(12b-1)
Fees (3)........ None 0.15% 0.15% None 0.90% 0.90% None 0.90% 0.90%
Other Expenses.. 0.86% 0.32% 0.32% 0.86% 0.38% 0.38% 0.86% 0.55% 0.44%
Total Annual Fund
Operating
Expenses Before
Expense
Reimbursement.... 1.06% 0.95% 0.95% 1.06% 1.76% 1.76% 1.06% 1.93% 1.82%
Expense
Reimbursement (4)(5).. 0.26% -- -- 0.26% -- -- 0.26% 0.18% --
Net Expenses
(6).............. 0.80% 0.95% 0.95% 0.80% 1.76% 1.76% 0.80% 1.75% 1.82%

Institutional Class I/Class
I Shares
---------------------------
Actual Pro Forma
----------------- ---------
NAF SunAmerica Money
Money Money Market
Market Market 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... None N/A None
Maximum Deferred
Sales Charge
(Load) (as a
percentage of
original purchase
price or
redemption price,
whichever is
lower) (1)....... None N/A None
Maximum Sales
Charge (Load)
Imposed on
Reinvested
Dividends........ None N/A None
Redemption Fee
(2).............. None N/A None
Annual Fund
Operating
Expenses (as a
percentage of
average net
assets) (expenses
that are deducted
from Fund
assets):
Management
Fees............ 0.20% N/A 0.48%
Distribution
and/or Service
(12b-1)
Fees (3)........ None N/A None
Other Expenses.. 0.86% N/A 0.45%
Total Annual Fund
Operating
Expenses Before
Expense
Reimbursement.... 1.06% N/A 0.93%
Expense
Reimbursement (4)(5).. 0.26% N/A 0.13%
Net Expenses
(6).............. 0.80% N/A 0.80%

-------
+ As reflected in the Acquired Funds Prospectuses.

* "Other Expenses," "Total Annual Fund Operating Expenses Before Expense
Reimbursement" and "Expense Reimbursement" have been estimated for the
Money Market Combined Fund.

** The Money Market Combined Fund will commence offering Class I shares upon
completion of the applicable Reorganization.

(1) Class A, Class B and Class C shares of an Acquired Fund are not subject to
a contingent deferred sales charge ("CDSC") and 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 will
not be subject to a CDSC either. 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) if the original
purchase was Class A of another SunAmerica Mutual Fund which you
subsequently exchanged into shares of an Acquiring Fund, (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 No. 2(a)-(b): 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 the
Combined Funds.

(2) 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.
(3) 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.
(4) With respect to each Acquired 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 do not approve the Reorganizations, there is no assurance
AGAM would continue to provide such fee reductions and expense
reimbursements past such date.

(5) With respect to certain classes of the Acquiring Funds and the Combined
Funds, the SunAmerica Board, including a majority of the Directors who are
not "interested persons" of SunAmerica Money Market Funds, Inc., within
the meaning of Section 2(a)(19) 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. SAAMCo may
not increase such ratios, which are contractually required by an 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.

(6) SAAMCo is voluntarily waiving fees and/or reimbursing so that the total
net expense ratio of Class II shares of the SunAmerica Money Market Fund
does not exceed 1.76%. These waivers and reimbursements will continue
indefinitely, but may be terminated at any time.

The foregoing Fee Table is intended to assist investors in understanding the
costs and expenses that a shareholder of an Acquired Fund 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 Fund would be assuming the Reorganizations
were completed on June 30, 2001.

These examples are intended to help you compare the cost of investing in the
Money Market 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:
----------------------------------
5
1 Year 3 Years Years 10 Years (4)
------ ------- ------ ------------

Expenses if you did redeem your shares at
the end of the period:
Class A
NAF Money Market Fund (1)................ $ 82 $311 $ 560 $1,271
SunAmerica Money Market Fund............. 97 303 526 1,166
Pro Forma Money Market Combined Fund*.... 97 303 526 1,166
Class B
NAF Money Market Fund (1)................ $ 82 $311 $ 560 $1,271
SunAmerica Money Market Fund............. 679 854 1,154 1,859
Pro Forma Money Market Combined Fund*.... 679 854 1,154 1,859
Class C/Class II
NAF Money Market Fund (1)................ $ 82 $311 $ 560 $1,271
SunAmerica Money Market Fund (1)......... 376 646 1,039 2,142
Pro Forma Money Market Combined Fund*
(2)..................................... 383 667 1,075 2,216
Institutional Class I/Class I
NAF Money Market Fund (1)................ $ 82 $311 $ 560 $1,271
Pro Forma Money Market Combined Fund*.... 82 255 444 990

1 Year 3 Years 5 Years 10 Years (4)
------ ------- ------- ------------

Expenses if you did not redeem your shares
at the end of the period:
Class A
NAF Money Market Fund (1)............... $ 82 $311 $ 560 $1,271
SunAmerica Money Market Fund............ 97 303 526 1,166
Pro Forma Money Market Combined Fund*... 97 303 526 1,166
Class B
NAF Money Market Fund (1)............... $ 82 $311 $ 560 $1,271
SunAmerica Money Market Fund............ 179 554 954 1,859
Pro Forma Money Market Combined Fund*... 179 554 954 1,859
Class C/Class II
NAF Money Market Fund (1)............... $ 82 $311 $ 560 $1,271
SunAmerica Money Market Fund (1)........ 276 646 1,039 2,142
Pro Forma Money Market Combined Fund*
(3).................................... 283 667 1,075 2,216
Institutional Class I/Class I
NAF Money Market Fund (1)............... $ 82 $311 $ 560 $1,271
Pro Forma Money Market Combined Fund*... 82 255 444 990

--------
* Assuming the Reorganization had taken place on June 30, 2001.
(1) Expenses used for the Example include fee waivers and expense
reimbursements described in footnotes (4) and/or (5) above under "--Fee
Tables."

(2) SAAMCo is voluntarily waiving fees and/or reimbursing expenses for Class
II shares of the Money Market Combined Fund. However, this fee waiver
and/or expense reimbursement is not reflected in the

example above. The following are your costs after these fees waivers and/or
expense reimbursements: $377, $649, $1,045 and $2,152 for the periods of one
year, three years, five years and ten years, respectively.

(3) SAAMCo is voluntarily waiving fees and/or reimbursing expenses for Class
II shares of the Money Market Combined Fund. However, this fee waiver
and/or expense reimbursement is not reflected in the example above. The
following are your costs after these fees waivers and/or expense
reimbursements: $277, $649, $1,045 and $2,152 for the periods of one year,
three years, five years and ten years, respectively. Such voluntary fee
waivers and expense reimbursements may be terminated at any time at the
option of SAAMCo.

(4) 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 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)-(b): Approval of the Plans."

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

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

(as of June 30, 2001)*

Class A Shares Class B Shares Class C/Class II Shares
------------------------------ ------------------------------ ------------------------------
Actual Pro Forma Actual Pro Forma Actual Pro Forma
-------------------- --------- -------------------- --------- -------------------- ---------
NAF SunAmerica Municipal NAF SunAmerica Municipal NAF SunAmerica Municipal
Municipal Municipal Money Municipal Municipal Money Municipal Municipal Money
Money Money Market Money Money Market Money Money Market
Market Market Combined Market Market Combined Market Market 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).................. None None None 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)
(1)..................... None None None None 5.00% 5.00% None 1.00% 1.00%
Maximum Sales Charge
(Load) Imposed on
Reinvested Dividends.... None None None None None None None None None
Redemption Fee (2)...... 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........ 0.35% 0.35% 0.35% 0.35% 0.35% 0.35% 0.35% 0.35% 0.35%
Distribution and/or
Service (12b-1) Fees
(3).................... None 0.15% 0.15% None 0.90% 0.90% None 0.90% 0.90%
Other Expenses......... 0.81% 2.16% 2.16% 0.81% 2.28% 2.28% 0.81% 9.07% 9.07%
Total Annual Fund
Operating Expenses
Before Expense
Reimbursement........... 1.16% 2.66% 2.66% 1.16% 3.53% 3.53% 1.16% 10.32% 10.32%
Expense Reimbursement
(4)(5).................. 0.36% 1.71% 1.71% 0.36% 1.83% 1.83% 0.36% 8.62% 8.62%
Net Expenses ........... 0.80% 0.95% 0.95% 0.80% 1.70% 1.70% 0.80% 1.70% 1.70%

----
+ As reflected in the Acquired Funds Prospectuses.

* "Other Expenses," "Total Annual Fund Operating Expenses Before Expense
Reimbursement" and "Expense Reimbursement" have been estimated for the
SunAmerica Municipal Money Market Fund and the Municipal Money Market
Combined Fund.

(1) Class A, Class B and Class C shares of an Acquired Fund are not subject
to a CDSC and 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 will not be subject to a CDSC either.
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) if the
original purchase was Class A of another SunAmerica Mutual Fund which you
subsequently exchanged into shares of an Acquiring Fund, (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 No. 2(a)-(b): Approval of the Plans--Comparison of
the Funds--Purchase, Exchange and Redemption of Shares" 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 the Combined Funds.

(2) 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.

(3) 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.

(4) With respect to each Acquired 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 do not approve the Reorganizations, there is no assurance
AGAM would continue to provide such fee reductions and expense
reimbursements past such date.

(5) With respect to certain classes of the Acquiring Funds and the Combined
Funds, the SunAmerica Board, including a majority of 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. SAAMCo may not increase
such ratios, which are contractually required by an 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.

The foregoing Fee Table is intended to assist investors in understanding the
costs and expenses that a shareholder of an Acquired Fund 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 Fund would be assuming the Reorganizations were
completed on June 30, 2001.

These examples are intended to help you compare the cost of investing in the
Municipal Money Market Funds with the cost of investing in other mutual funds.

Examples

Cumulative Expenses Paid
for the Period of:
-------------------------------------
1 Year 3 Years 5 Years 10 Years(/2/))
------ ------- ------- --------------

Expenses if you did redeem your shares
at the end of the period:
Class A
NAF Municipal Money Market Fund (1)... $ 82 $333 $ 604 $1,377
SunAmerica Municipal Money Market Fund
(1).................................. 97 303 526 1,166
Pro Forma Municipal Money Market
Combined Fund* (1)................... 97 303 526 1,166
Class B
NAF Municipal Money Market Fund (1)... $ 82 $333 $ 604 $1,377
SunAmerica Municipal Money Market Fund
(1).................................. 673 836 1,123 1,810
Pro Forma Municipal Money Market
Combined Fund* (1)................... 673 836 1,123 1,810
Class C/Class II
NAF Municipal Money Market Fund (1)... $ 82 $333 $ 604 $1,377
SunAmerica Municipal Money Market Fund
(1).................................. 371 630 1,014 2,089
Pro Forma Municipal Money Market
Combined Fund* (1)................... 371 630 1,014 2,089

1 Year 3 Years 5 Years 10 Years(/2/)
------ ------- ------- --------------

Expenses if you did not redeem your
shares at the end of the period:
Class A
NAF Municipal Money Market Fund (1)... $ 82 $333 $ 604 $1,377
SunAmerica Municipal Money Market Fund
(1).................................. 97 303 526 1,166
Pro Forma Municipal Money Market
Combined Fund* (1)................... 97 303 526 1,166
Class B
NAF Municipal Money Market Fund (1)... $ 82 $333 $ 604 $1,377
SunAmerica Municipal Money Market Fund
(1).................................. 173 536 923 1,810
Pro Forma Municipal Money Market
Combined Fund* (1)................... 173 536 923 1,810
Class C/Class II
NAF Municipal Money Market Fund (1)... $ 82 $333 $ 604 $1,377
SunAmerica Municipal Money Market Fund
(1).................................. 271 630 1,014 2,089
Pro Forma Municipal Money Market
Combined Fund* (1)................... 271 630 1,014 2,089

--------

* Assuming the Reorganization had taken place on June 30, 2001.

(1) Expenses used for the Example include fee waivers and expense
reimbursements described in footnotes (4) and/or (5) above under "--Fee
Tables."

(2) 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 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. Each Acquired Fund
is diversified within the meaning of the Investment Company Act.

Business of the Acquiring Funds

Each Acquiring Fund is organized as a separate investment portfolio or
series of SunAmerica Money Market Funds, Inc., a Maryland corporation, which
was incorporated on July 20, 1983. The SunAmerica Municipal Money Market Fund
is newly created and has not yet commenced operations. Each Acquiring Fund is
diversified within the meaning of the Investment Company Act.

Comparison of the Funds

A discussion of the investment objectives and principal investment policies
of the Funds is set forth below. Those objectives and policies that are
identified as fundamental may not be changed without shareholder approval.

Money Market Funds

Investment Objectives

Both Money Market Funds have substantially similar investment objectives.
The investment objective of the NAF Money Market Fund is to obtain maximum
current income consistent with preservation of principal and liquidity. The
investment objective of the SunAmerica Money Market Fund is to seek as high a
level of current income as is consistent with liquidity and stability of
capital. The NAF Money Market Fund's investment objective is a fundamental
policy, while SunAmerica Money Market Fund's investment objective is a
nonfundamental policy.

Principal Investment Strategies

Both Money Market Funds also have substantially similar principal investment
strategies. The NAF Money Market Fund tries to achieve its investment objective
by investing in short-term money market securities to provide liquidity,
protection of investment and current income. The SunAmerica Money Market Fund
tries to achieve its investment objective by investing primarily in high-
quality money market instruments selected principally on the basis of quality
and yield. In accordance with Rule 2a-7 under the Investment Company Act ("Rule
2a-7"), both Funds must limit their investments to securities that mature in 13
months or less and both Funds must have a dollar weighted average portfolio
maturity of 90 days or less. In addition, Rule 2a-7 imposes certain
requirements as to the quality of the instruments that each Fund may hold.

Municipal Money Market Funds

Investment Objectives

Both Municipal Money Market Funds have substantially similar investment
objectives. The investment objective of the NAF Municipal Money Market Fund is
to seek liquidity, protection of capital and current income through investments
in short-term money market securities that are exempt from regular federal
income taxation. The investment objective of the SunAmerica Municipal Money
Market Fund is to seek as high a level of current income as is consistent with
liquidity and stability of capital and that is exempt from regular federal
income taxation. The investment objectives of both Municipal Money Market Funds
are nonfundamental policies.

Principal Investment Strategies

The SunAmerica Municipal Money Market Fund will operate as the successor to
the NAF Municipal Money Market Fund and both Funds have substantially similar
principal investment strategies. The NAF Municipal Money Market Fund tries to
achieve its investment objective by investing in short-term money market
securities to provide liquidity, protection of investment and current income
that is exempt from regular federal income tax. The SunAmerica Municipal Money
Market Fund tries to achieve its investment objective by investing primarily in
high-quality money market instruments selected primarily on the basis of
quality and yield that are exempt from regular federal income tax. Under normal
conditions, both Funds invest at least 80% of their total assets in municipal
securities which pay income exempt from federal income taxes. Both Funds are
subject to the requirements of Rule 2a-7 under the Investment Company Act.

Both Funds may invest in private activity bonds. Federal tax law imposes an
alternative minimum tax ("AMT") with respect to both corporations and
individuals based on certain items of tax preference. Interest on certain
municipal obligations, generally including private activity bonds issued after
August 7, 1986, is treated as a tax preference item for purposes of the AMT. In
addition, corporate shareholders must include the full amount of exempt-
interest dividends in computing the preference items for purposes of the AMT on
corporations.

All Funds

Principal Risk Factors

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

Trustees, Directors and Officers

North American Funds is governed by a Board of Trustees (a "Board").
SunAmerica Money Market Funds, Inc. is governed by a Board of Directors (a
"Board" and, together with the Board of Trustees, the "Boards"). Each Board
meets regularly to review its respective Funds' investments, performance,
expenses, and other business affairs. Each Board 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 of each Acquired
Fund and Acquiring Fund, respectively, and for providing certain administrative
services to such Fund. See "Proposals Nos. 2(a)-(b): Approval of the Plans--
Comparison of the Funds--Management Arrangements--Comparison of Management and
Administrative Arrangements and Fees" 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 and Acquiring Fund to AGAM and SAAMCo,
respectively, for their management and administrative services:

Fund: Advisory Fee:
----- -------------

NAF Money Market Fund 0.20% up to $500 million and
0.145% on excess over $500 million
SunAmerica Money Market Fund 0.50% up to $600 million, 0.45% on
the next $900 million and 0.40% on
excess over $1.5 billion
NAF Municipal Money Market Fund 0.35%
SunAmerica Municipal Money Market Fund 0.35%

The advisory fee rate payable by the Money Market Combined Fund after
consummation of the Money Market Funds Reorganization will be the same as the
advisory fee rate payable by the SunAmerica Money Market Fund and higher than
the advisory fee rate payable by the NAF Money Market Fund. The advisory fee
rate payable by the Municipal Money Market Combined Fund after consummation of
the Municipal Money Market Funds Reorganization will be the same as the
advisory fee rate payable by the NAF Municipal Money Market Fund. The table
below sets forth the pro forma effective fee rate of each Combined Fund as of
June 30, 2001, as a percentage of average daily net assets, assuming the
Reorganizations had been completed as of such date:

Combined Fund: Pro Forma Effective Advisory Fee Rate:
-------------- --------------------------------------

Combined Money Market Fund 0.48%
Combined Municipal Money Market
Fund 0.35%

Investment Advisory Agreements. The investment advisory agreement between
SunAmerica Money Market Funds, 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 advisory fees, the effective dates, and the identity of
the adviser. See "Proposals Nos. 2(a)-(b): Approval of the Plans" for further
discussion regarding these agreements.

Subadvisory Arrangements. New AGIM currently serves as subadviser to each of
the Acquired Funds. After the Municipal Money Market Funds Reorganization, New
AGIM will serve as the subadviser to the Municipal Money Market Combined Fund
pursuant to a new subadvisory agreement with SAAMCo (the "SunAmerica
Subadvisory Agreement"). The SunAmerica Subadvisory Agreement is similar to
both the New and Previous Subadvisory Agreements applicable to the NAF
Municipal Money Market Fund (collectively, the "NAF Subadvisory Agreement")
except for certain matters including the effective dates and the identity of
the subadviser. See "Proposals Nos. 2(a)-(b): Approval of the Plans" for
further discussion regarding these agreements.

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)-(b): 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 certain
asset allocation funds of North American Funds that invest in Institutional
Class I shares of the NAF Money Market Fund. SACS will provide these services
after the Reorganization with respect to Class I shares of the Money Market
Combined Fund. See "Proposals Nos. 2(a)-(b), 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)-(b): 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 proportionally, on
certain Fund matters, including the election of Trustees/Directors, changes in
fundamental policies, or approval of changes in investment advisory agreements.

The table below sets forth the share classes currently offered by each of
the Acquired Funds and the Acquiring Funds and the shares classes that will be
offered by the Combined Funds after consummation of the respective
Reorganizations.

SunAmerica Money Money Market Combined
NAF Money Market Fund Market Fund Fund
--------------------- -------------------- ----------------------

Class A A A
B B B
C II II
Institutional Class I N/A I

NAF Municipal Money SunAmerica Municipal Municipal Money Market
Market Fund Money Market Fund Combined Fund
--------------------- -------------------- ----------------------

Class A A A
B B B
C II II

Purchase of Shares. The procedures for purchasing shares are similar, but
not identical, for all Funds. See "Proposals Nos. 2(a)-(b): 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)-(b): 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 "Exchange Privilege" 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)-(b): 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.

Dividends. The Funds currently have the same policies with respect to
dividends. See "Proposals Nos. 2(a)-(b): Approval of the Plans" below, "Pricing
of Shares" and "Dividends and Distributions from North American Funds" in the
Acquired Funds Prospectuses and "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)-(b):
Approval of the Plans" below, "Pricing of Fund Shares" in the Acquired Funds
Prospectuses and "Determination of Net Asset Value" 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 "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)-(b): Approval
of the Plans."

PRINCIPAL RISK FACTORS AND SPECIAL CONSIDERATIONS

PRINCIPAL RISKS OF INVESTING IN THE FUNDS

All of the investment risks associated with an investment in an Acquired
Fund are the same as those associated with an investment in the respective
Acquiring Fund. A discussion of the principal risks of investing in the Funds
is set forth below. See the Acquired Funds Prospectuses, the Acquiring Funds
Prospectus, the Acquired Funds Statement and the Acquiring Funds Statement for
more detailed discussions of investment risks associated with an investment in
the Funds. There is no guarantee that the investment objective of a Fund will
be achieved or that the value of a shareholder's investment in the Fund will
not decrease. Furthermore, although each Fund seeks to maintain a stable share
price of $1.00, there can be no assurance that each Fund will be able to do so
and it is possible to lose money by investing in a Fund.

All Funds

Interest Rate Fluctuations. Each Fund is subject to the risk that the value of
its investments may be subject to changes in interest rates.

Credit Risk. Each Fund is also subject to credit risk, which is the risk that
the issuer in which a Fund invests, will fail financially or otherwise fail to
honor its obligations. An issuer with a lower credit rating will be more likely
than a higher rated issuer to default or otherwise become unable to honor its
financial obligations.

Securities Selection. A strategy used by a Fund, or securities selected by its
portfolio manager, may fail to produce the intended return.

PROPOSALS NOS. 1(a)-(b):

APPROVAL OF THE NEW INVESTMENT ADVISORY AGREEMENT

AND THE NEW SUBADVISORY AGREEMENT

THE AIG MERGER AND THE NEW INVESTMENT ADVISORY AND SUBADVISORY AGREEMENTS

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 (the "Previous Agreements") each
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 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
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 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 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, 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 to those of the Previous Investment
Advisory Agreement and Previous Subadvisory Agreement, respectively. The
Interim Investment Advisory Agreement and the Interim Subadvisory Agreement
differ from the respective Previous Agreement only with respect to the
effective date, the term and the escrow provisions relating to AGAM and AGIM's
fees (as described above). Under the Investment Company Act, however, AGAM and
New AGIM may continue to serve as the investment adviser or subadviser for each
Acquired Fund beyond an interim period of 150 days only if shareholders of such
Acquired Fund approve a new investment advisory agreement with AGAM and
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 to those of the respective
Previous Agreement. The New Agreements differ from the Previous Agreements only
with respect to their effective dates. See "--Description of the New Investment
Advisory Agreement" and "--Description of the New

Subadvisory Agreement" below for a description of the New Investment Advisory
Agreement and the New Subadvisory Agreement and the services to be provided by
AGAM and New AGIM, respectively, 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, SAMMCo and
AIG represented that there would be no material change in the nature and
quality of services provided by AGAM and New AGIM. 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 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 Fund 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)

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" 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.

For the fiscal year ended October 31, 2000, North American Funds paid total
advisory fees to AGAM of $7,339,733. Of such amount, $56,326 and $8,044 (for
the period July 7, 2000 to October 31, 2000) were attributable to the NAF Money
Market Fund and the NAF Municipal Money Market 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 the NAF
Municipal Money Market Fund. During this period, North American Funds paid
total advisory fees to VALIC of $540,574. Of this amount, $24,903 was
attributable to the NAF Municipal Money Market Fund. 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 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
Investment 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 and AGIM were 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, American
2929 Allen Parkway General.
Houston, TX 77019
Kent E. Barrett......... Director and Treasurer; Senior Vice President and General
2929 Allen Parkway Auditor, America 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, $41,454 and $2,388 were attributable to the NAF Money
Market Fund and the NAF Municipal Money Market Fund, respectively. From
November 1, 1999 to July 7, 2000, VALIC, an affiliate of AGAM, provided
accounting services for the NAF Municipal Money Market Fund under an Accounting
Services Agreement. For this period, North American Funds paid VALIC $27,375
for these services. Of such amount, $1,494 was attributable to the NAF
Municipal Money Market Fund.

For the fiscal year ended October 31, 2000, the Acquired Funds did not pay
any fee to AGAM under the NAF Services Agreement (as defined below).

For the fiscal year ended October 31, 2000, the Acquired Funds paid the NAF
Distributor the following distribution and service fees:

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

NAF Money Market Fund............................ $ 0$ 0 $ 0
NAF Municipal Money Market Fund.................. $ 656$ 1,452 $ 0

From November 1, 1999 to July 7, 2000, VALIC paid an affiliate of NAF
Distributor distribution and service fees in the amount of $7,465 (Class A) and
$20,404 (Class B) of the NAF Municipal Money Market Fund.

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

PROPOSAL NO. 1(b)

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 are being asked to approve the New
Subadvisory Agreement between AGAM and New AGIM to ensure that the Acquired
Funds receive subadvisory services during the period prior to consummation of
the Reorganization. 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, and 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 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
Acquired Fund, subject to the supervision of the NAF Board. New AGIM will
formulate a continuous investment program for each Acquired Fund consistent
with its investment objectives and policies. New AGIM will also 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.

Subadvisory Fee
--------------------------------------------------
Between Between
$50 Million $200 Million
First and and Excess Over
Acquired Fund $50 Million $200 Million $500 Million $500 Million
------------- ----------- ------------ ------------ ------------

NAF Money Market Fund...... 0.075% 0.075% 0.075% 0.020%
NAF Municipal Money Market
Fund...................... 0.250% 0.250% 0.200% 0.150%

For the fiscal year ended October 31, 2000, AGAM paid total subadvisory fees
to AGIM of $3,194,477. Of such amount, $21,204 and $5,873 (for the period July
7, 2000 to October 31, 2000) were attributable to the NAF Money Market Fund and
the NAF Municipal Money Market Fund, respectively. From November 1, 1999 to
July 7, 2000, VALIC, an affiliate of AGAM, served as investment adviser to the
NAF Municipal Money Market Fund. During this period, VALIC paid total
subadvisory fees of $276,034. Of such amount, $12,451 was attributable to the
NAF Municipal Money Market Fund.

The Board of Trustees of North American Funds unanimously recommends that
the shareholders of each 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 Money Market Fund since March 2000,
and the NAF Municipal Money Market Fund since its inception. 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 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.

Name and Address Position with AGIM and Principal 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.

PROPOSALS NOS. 2(a)-(b): APPROVAL OF THE PLANS

COMPARISON OF THE FUNDS

Directors and Officers

SunAmerica Money Market Funds, 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 Money Market Funds, Inc. and performs various duties imposed on
directors of investment companies by the Investment Company Act and under
SunAmerica Money Market Funds, Inc.'s Articles of Incorporation. Directors and
officers of SunAmerica Money Market Funds, Inc. are also directors 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
Money Market Funds, 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, New York 10017-3204. For the
purposes of this Proxy Statement and Prospectus, the SunAmerica Mutual Funds
("SAMF") consist of SunAmerica Money Market Funds, Inc., SunAmerica Income
Funds, SunAmerica Equity Funds, SunAmerica Style Select Series, Inc. and
SunAmerica Strategic Investment Series, Inc. An asterisk indicates that the
Director is an interested person of the SunAmerica Money Market Funds, Inc.
within the meaning of Section 2(a)(19) of the Investment Company Act.

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

S. James Coppersmith, 68.. Director Retired; formerly, President and General
Manager, WCVB-TV, a division of the Hearst
Corp. (1982 to 1994); Director/Trustee of
SAMF and Anchor Series Trust ("AST").

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

Stephen J. Gutman, 58..... 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.

Sebastiano Sterpa, 72..... 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.

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

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. Retired Administrator. Trustee, North American Funds
Craven, 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, 63.... 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 Money Market Funds, 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 Money Market Funds, 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 to 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 Money Market Funds,
Inc. receive no direct remuneration in such capacity from SunAmerica Money
Market Funds, 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 Money Market Funds, 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 Money Market Funds, 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 Money Market Funds, Inc. SunAmerica Money Market Funds,
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 Trustees' and Directors' 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
has at least 10 years of consecutive service as a disinterested Director 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 December 31, 2000,
except as otherwise indicated. Neither the Directors who are interested persons
of SunAmerica Money Market Funds, Inc. nor any officers of SunAmerica Money
Market Funds, Inc. receive any compensation.

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

S. James Coppersmith.... $6,369 $48,944 $29,670 $67,500
Samuel M. Eisenstat..... $6,716 $42,950 $46,083 $71,500
Stephen J. Gutman....... $6,369 $44,441 $60,912 $67,500
Sebastiano Sterpa***.... $6,588 $ 9,295 $ 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. As of 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 advisory fees, 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): New Investment Advisory Agreement." The advisory fees
payable by the Acquiring Funds to SAAMCo are discussed above under "Summary."

The effective advisory fees payable by the SunAmerica Money Market Fund
under the SunAmerica Investment Advisory Agreement are at a higher annual rate
than the effective advisory fees payable by the

NAF Money Market Fund under the NAF Investment Advisory Agreement. The
effective advisory fees payable by the SunAmerica Municipal Money Market Fund
under the SunAmerica Investment Advisory Agreement are at the same annual rate
as the effective advisory fees payable by the NAF Municipal Money Market Fund
under the NAF Investment Advisory Agreement. See "--NAF Board Considerations:
Potential Benefits to Shareholders as a Result of the Reorganizations."

The advisory fee rate payable by the Money Market Combined Fund after
consummation of the Money Market Reorganization will be higher than the
advisory fee rates payable by the NAF Money Market Fund. The advisory fee rate
payable by the Municipal Money Market Combined Fund after consummation of the
Municipal Money Market Reorganization will be the same as the advisory fee
rates payable by the NAF Municipal Money Market Fund. The pro forma effective
fee rate of each Combined Fund, as a percentage of average daily net assets,
after taking into account the completion of the Reorganizations, is shown above
under "Summary."

In addition, 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 ("Subadvisers") to manage all or a portion of the investment
portfolio of an Acquired Fund or Acquiring Fund, respectively. See "--
Comparison of Subadvisory Arrangements" below. SAAMCo has appointed New AGIM to
serve as Subadviser to the SunAmerica Municipal Money Market Fund.

Comparison of Subadvisory Arrangements. New AGIM serves as Subadviser of
each Acquired Fund, and will serve as Subadviser to the Municipal Money Market
Combined Fund. See "Proposal No. 1(b): The New Subadvisory Agreement--
Description of the New Subadvisory Agreement" for further discussion regarding
these arrangements.

Under the terms of each of the Subadvisory Agreements between AGAM and New
AGIM, for the respective Acquired Fund, the Subadviser manages the investment
and reinvestment of the assets of such Acquired Fund, subject to the
supervision of the NAF Board. The Subadviser formulates a continuous investment
program for such Acquired Fund consistent with its investment objectives and
policies. The Subadviser implements such programs by purchases and sales of
securities and regularly reports to AGAM and the NAF Board with respect to
their implementation.

As compensation for its services, New AGIM receives 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. Absent
any applicable fee waivers, the fee rate that AGAM is obligated to pay to AGIM
under its respective Subadvisory Agreement as follows: for the NAF Money Market
Fund, AGAM pays AGIM a fee at the rate of 0.075% up to $500 million and 0.020%
on the excess over $500 million; for the NAF Municipal Money Market Fund, AGAM
pays AGIM a fee at the rate of 0.250% on the first $200 million, 0.200% between
$200 million and $500 million and 0.150% on the excess over $500 million.

For the fiscal year ended October 31, 2000, AGAM paid total subadvisory fees
of $3,194,477. Of such amount, $21,204 and $5,873 (for the period July 7, 2000
to October 31, 2000) were attributable to the NAF

Money Market Fund and the NAF Municipal Money Market Fund, respectively. From
November 1, 1999 to July 7, 2000, VALIC, an affiliate of AGAM, served as
investment adviser to the NAF Municipal Money Market Fund. During this period,
VALIC paid total subadvisory fees of $276,034. Of such amount, $12,451 was
attributable to the NAF Municipal Money Market Fund.

After the Reorganization, New AGIM will serve as the Subadviser to the
Municipal Money Market Combined Fund pursuant to the SunAmerica Subadvisory
Agreement. The terms of the NAF Subadvisory Agreement and the SunAmerica
Subadvisory Agreement are the same in all material respects, including
subadvisory fee rates.

Under the terms of the SunAmerica Subadvisory Agreement between SAAMCO and
New AGIM, New AGIM will manage the investment and reinvestment of the assets of
the Municipal Money Market Combined Fund, subject to the supervision of the
SunAmerica Board. New AGIM will formulate a continuous investment program for
such 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 SAAMCo and the SunAmerica Board with respect to their implementation.

The SunAmerica Subadvisory Agreement provides that in the absence of willful
misfeasance, bad faith, gross negligence or reckless disregard of New AGIM's
(and its affiliates') obligations or duties thereunder ("disabling conduct"),
New AGIM is not subject to liability to the Municipal Money Market Combined
Fund (or to any shareholder thereof) for any act or omission in the course of
rendering services to the Municipal Money Market Combined 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 Agreement also provides that except for
such disabling conduct, New AGIM will indemnify SAAMCo (and its affiliates)
from any liability arising from New AGIM's conduct under the SunAmerica
Subadvisory Agreement. With respect to the indemnification the NAF Subadvisory
Agreement does not contain a similar provision.

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 the initial
and deferred sales charges in respect of 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 continue to provide distribution services to each Combined
Fund.

Distribution and Service (12b-1) Fees

Neither of the Acquired Funds is subject to a distribution plan under Rule
12b-1 under the Investment Company Act ("Rule 12b-1"), and consequently Class
A, Class B and Class C shares of each Acquired Fund are not subject to any
distribution fees. Each of the Acquiring Funds has adopted a plan under Rule
12b-1 that allows it to pay distribution and other fees for the sale and
distribution of its shares. Class A, Class B and Class II shares of each
Acquiring Fund are subject to distribution and account maintenance and service
fees pursuant to the applicable plan under Rule 12b-1. The SunAmerica Money
Market Fund has Class I shares that are not

subject to a distribution plan. The table below sets forth the distribution and
account maintenance and service fees for each of these classes.

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

A None None
B None None
C None None

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

A None 0.15%
B 0.75% 0.15%
II 0.75% 0.15%

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 certain asset allocation
funds of North American Funds that invest in Institutional Class I shares 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 equal to .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 .22% of average
daily net assets 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 $1,000 $1,000
. 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 $50 . non-retirement account:
investments $100 retirement account:
$25 dollar cost
averaging: you must
invest at least $25 per
month

Initial Sales Charge (as Class A: None Class A: None
a percentage of Class B: None Class B: None
offering price) Class C: None Class II: 1.00% (d)
Institutional Class I: None Class I: None (a)
Initial sales charge is
waived for certain investors

Deferred Sales Charge Class A: None Class A: None
Class B: None (b) Class B: Shares redeemed
within 6 years are subject
to a CDSC (b)(c)
Class C: None (c) Class II: Shares redeemed
within 18 months after
purchase are subject to a 1%
CDSC (c)
Institutional Class I: None Class I: None (a)

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

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

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

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

Conversion Class B shares do not Class B shares automatically
convert into Class A shares convert into Class A shares
at any time approximately eight years
after purchase

Exchanges Class A shares of an Shares of an Acquiring Fund
Acquired Fund are subject to may be exchanged for shares
a sales charge upon exchange of the same class of any
other fund distributed by
SACS without any sales
charges
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) Although not currently offered by the SunAmerica Money Market Fund, Class I
shares will be offered by the Money Market Combined Fund upon consummation
of the Reorganization.
(b) Class B shares of the Acquired Funds are not subject to a CDSC. The CDSC
schedule of Class B shares of the Acquiring Funds is set forth below:

CDSC on shares being sold

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

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

(c) Class B and Class C shares of an Acquired Fund are not subject to a CDSC
and 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 will not be a subject to a CDSC either (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.

Class B shares of the Acquiring Funds, as well as other SunAmerica Mutual
Funds, convert to Class A shares approximately eight years after issuance.
The time that a shareholder holds shares of an Acquiring Fund will be taken
into account in calculating the conversion period. Similarly, the time that
a Class B or Class II shareholder holds shares of an Acquiring Fund will be
taken into account when determining whether or not a CDSC will apply to a
redemption. In contrast, the time that a shareholder holds Class B or C
shares of an Acquired Fund does not count in determining the eight-year
period for conversion of Class B shares to Class A, or in determining
whether the applicable period for imposition of a CDSC has lapsed.

(d) While Class C shares of an Acquired Fund are not subject to a sales charge,
Class II shares of an Acquiring Fund are subject to a 1.00% initial sales
charge. However, unlike Class A shares of the Acquired Funds, which are
subject to a sales charge upon an exchange, there are no sales charges
imposed on exchanges among the SunAmerica Mutual Funds, including the
Acquiring Funds.

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. Investments for which market quotations are readily
available are valued at their prices as of the close of regular trading on the
New York Stock Exchange for the day. It is the intention of each Fund to
maintain a net asset value per share of $1.00, although there can be no
assurance that a Fund will be able to do so.

Under Rule 2a-7 under the Investment Company Act, the valuation of each
Fund's investments is based upon their amortized cost. This entails valuing an
instrument at its cost and thereafter assuming a constant amortization to
maturity of any premium or discount regardless of the impact of fluctuating
interest rates on the market value of the instrument. While this method
provides certainty in valuation, it may result in periods during which the
value of an instrument, as determined by the amortized cost method, is higher
or lower than the price a Fund would receive if it sold the instrument. The
purpose of this method of valuation is to facilitate the maintenance of a
constant net asset value per share of $1.00. There can be no assurance,
however, that each Fund will be able to maintain a stable net asset value of
$1.00 per share.

Certain conditions must be met in connection with the application of the
Commission's valuation rules to the Funds. These conditions include maintaining
a dollar-weighted average portfolio maturity of 90 days or less, purchasing
instruments having remaining maturities of 397 calendar days or less, and
investing only in securities determined by the adviser under procedures adopted
by each respective Board to present minimal credit risks and which are of high
quality as determined in accordance with Rule 2a-7. 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 an Acquired Fund, you pay the
net asset value. When you buy shares of an Acquiring 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 Acquired Fund declares income dividends daily and pay income
dividends, if any, monthly. Each Acquired Fund also declares and makes capital
gains distributions, if any, monthly. Each Acquiring Fund declares income
dividends daily and pays income dividends, if any, monthly. Dividends are paid
on or about the fifteenth day of the month by the Acquiring Funds. Capital
gains distributions, if any, are paid at least annually by the Acquiring Funds.
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. Subject to this same limitation, 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 III: 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. The Acquired Funds offers programs
pursuant to which shareholders pay reduced sales charges. See "Section III:
Investing in the North American Funds" in the Acquired Funds Prospectuses for
more information regarding these programs.

Reinstatement Privileges. 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 additional
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. The SunAmerica Municipal Money Market Fund has been recently
created and has not yet commenced operations; consequently, it does not have an
investment and performance record. After the reorganization, the Municipal
Money Market Combined Fund, as the successor to the NAF Municipal Money Market
Fund, will assume and publish the investment performance record of the NAF
Municipal Money Market Fund. See "Performance Information" in the NAF Municipal
Money Market Fund's Statement for information about the NAF Municipal Money
Market Fund's performance.

Important information about the SunAmerica Money Market Fund is also
contained in management's discussion of the SunAmerica Money Market Fund's
performance contained in the Annual Report to Shareholders of the Existing
Acquiring Fund for the year ended December 31, 2000, which accompanies this
Proxy Statement and Prospectus.

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.

Average Annual Total Returns*
(periods ended June 30, 2001)

NAF Money Market Fund** SunAmerica Money Market Fund
------------------------------------------------------------ ----------------------------------------------
Institutional
Class A Class B Class C Class I Class A Class B Class II
-------------- ------------- ------------- -------------- -------------- -------------- --------------

Year to Date**.. 2.27% 2.27% 2.27% 2.27% 2.08% -3.31% -0.31%
One year**...... 5.39% 5.39% 5.39% N/A 5.23% -0.62% 2.35%
Three year**.... 5.05% 5.05% 5.05% N/A 4.89% 3.10% 4.03%
Five year**..... 5.10% 5.10% 5.10% N/A 4.85% 3.67% N/A
Ten year**...... 4.65% N/A N/A N/A 4.25% N/A N/A
Since
Inception**.... 4.87% 5.12% 5.12% 5.35% 5.39% 3.80% 3.72%
(since 8/28/89) (since 4/1/94) (since 4/1/94) (since 7/10/00) (since 10/2/84) (since 9/24/93) (since 12/1/98)

--------

* The SunAmerica Municipal Money Market Fund has been recently created and has
not commenced operations; consequently, it does not have an investment
performance record.

** AGAM has waived certain fees in respect of the Acquired Funds. Absent such
waivers, the returns for the Acquired Funds shown above would be lower.

Yield Information. Yield is determined separately for classes of shares of a
Fund in accordance with a standardized formula prescribed by the Commission and
is not indicative of the amounts which were or will be paid to shareholders.
The yield quoted in a Fund's advertisements is computed by determining the net
change, exclusive of capital changes, in the value of a hypothetical
preexisting account having a balance of one share at the beginning of the 7-day
period. A hypothetical charge reflecting deductions for shareholder accounts is

subtracted from the above net change and the difference is divided by the value
of the account at the beginning of the 7-day period. The resulting figure is
multiplied by 365 divided by seven and carried to the nearest one hundredth of
one percent.

Effective yield quoted in the Fund's advertisements is computed by
determining the net change, exclusive of capital changes, in the value of a
hypothetical pre-existing account having a balance of one share at the
beginning of the 7-day period. A hypothetical charge reflecting deductions from
shareholder accounts is subtracted from the above net change and the difference
is divided by the value of the account at the beginning of the 7-day period.
The resulting figure is then compounded by adding one, raising the sum to a
power equal to 365 divided by seven, and subtracting one. The following formula
illustrates the effective yield computation.

[((Base Period Return/365*7) + 1) (365/7)]-1

The following table sets forth the SunAmerica Money Market Fund's yield and
effective yield for the Class A, Class B and Class II shares for the 7-day
periods ended December 31, 2000.

Class A Class B Class II
------- ------- --------

Yield.................................................. 5.73% 4.97% 4.91%
Effective Yield........................................ 5.89% 5.09% 5.03%

The following table sets forth the NAF Money Market Fund's yield and
effective yield for the Class A, Class B and Class C shares for the 7-day
periods ended October 31, 2000.

Class A Class B Class C
------- ------- --------

Yield.................................................. 5.92% 5.91% 5.92%
Effective Yield........................................ 6.10% 6.08% 6.10%

The following table sets forth the NAF Municipal Money Market Fund's yield,
effective yield and tax equivalent yield for the Class A, Class B and Class C
shares for the 7-day periods ended October 31, 2000.

Class A Class B Class C
------- ------- --------

Yield.................................................. 1.96% 1.96% 1.96%
Effective Yield........................................ 1.98% 1.98% 1.98%
Tax Equivalent Yield................................... 3.06% 3.06% 3.06%

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 proportionally, on certain Fund
matters, including the election of trustees or 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 or 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 Acquired Fund's subadviser
and SAAMCo 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.

Additional Information

Independent Auditors

Currently, PricewaterhouseCoopers LLP serves as the independent auditors of
the Acquired Funds and the Acquiring Funds. If the Reorganizations are
completed, it is anticipated that PricewaterhouseCoopers LLP will 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, Missouri 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 continue to serve as the transfer
agent of the Combined Funds.

Capital Stock

The NAF Money Market 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. The NAF Municipal Money Market Fund is authorized to
issue an unlimited number of full and fractional shares of beneficial interest,
par value $0.001 per share, divided into three classes designated Class A,
Class B and Class C. SunAmerica Money Market Funds, Inc. is authorized to issue
ten

billion (10,000,000,000) shares of common stock, of which three billion
(3,000,000,000) shares have been divided and classified as the SunAmerica Money
Market Fund and one hundred million (100,000,000) shares have been divided and
classified as the SunAmerica Municipal Money Market Fund. The SunAmerica Money
Market Fund is divided into four classes of shares, designated Class A, Class
B, Class II and Class I, consisting of one billion (1,000,000,000) Class A
shares, one billion (1,000,000,000) Class B shares, five hundred million
(500,000,000) Class II shares and five hundred million (500,000,000) Class I
shares, in each case par value $0.001 per share. The SunAmerica Municipal Money
Market Fund is divided into four classes of shares, designated Class A, Class
B, Class II and Class I, consisting of twenty-five million (25,000,000) Class A
shares, twenty-five million (25,000,000) Class B shares, twenty-five million
(25,000,000) Class II shares and twenty-five million (25,000,000) Class I
shares, in each case par value $0.001 per share. 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" above and "Section II: Fees and Expenses" (in
the case of Class A, Class B and Class C 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 "--
Issuance and Distribution of Corresponding Shares" for a description of the
classes of Corresponding Shares to be issued in the Reorganizations.

The North American Funds is an entity of the type commonly known as a
"Massachusetts business trust," while SunAmerica Money Market Funds, Inc. is
organized as a corporation under Maryland law. 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 Acquired 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
Fund's assets and operations, the possibility that such an Acquired Fund will
be unable to meet its obligations is remote. North American Funds believes the
risk of personal liability to shareholders is therefore remote. In contrast to
the laws governing Massachusetts business trust as described above, there is no
similar provision under Maryland law governing corporations providing for
shareholder liability for obligations of the Fund.

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 respective 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" 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. However, as a result of the Reorganizations, a shareholder of
the NAF Money Market Fund may hold a smaller percentage of ownership in the
respective Money Market Combined Fund than he or she did in the NAF Money
Market Fund prior to the Reorganization. The aggregate net asset value of the
Corresponding Shares will equal the aggregate net asset value of your shares of
the Acquired Fund. Because all of the Funds seek to maintain a price per share
of $1.00, you should end up with the same number of shares. In any event, the
total dollar value of your shares 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 respective 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 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 money market or municipal money market mutual fund which has
substantially the same 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 Acquiring Funds will assume substantially all of the
liabilities of the respective Acquired Funds.

. The historical performance records of the Acquired Funds and SunAmerica
Money Market Fund.

. The gross and net expense ratios of the Acquired Funds and the SunAmerica
Money Market Fund before the Reorganizations, the anticipated gross and
net expense ratios of the SunAmerica Municipal Money Market Fund and the
estimated expense ratios of the Combined Funds on a pro forma basis after
the Reorganizations.

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

. The fact that AGAM has agreed to waive fees or reimburse expenses for the
Acquired Funds, 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 and voluntarily agreed to waive
fees or reimburse expenses for certain classes of Acquiring Fund shares.

. 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 took into account the fact that the SunAmerica Money Market
Fund is approximately twenty times as large as the NAF Money Market Fund and
that as shareholders of the Money Market Combined Fund, NAF Money Market Fund
shareholders would enjoy the stability associated with an investment in a much
larger fund.

In addition, the NAF Board considered the difference in the fee structures
of the Acquiring Funds and the Acquired Funds. Specifically, the NAF Board
considered that Class B and Class II shares of the Acquiring Funds are subject
to sales charges and all Classes of shares of the Acquiring Funds are subject
to Rule 12b-1 distribution and/or account maintenance fees. Shares of the
Acquired Funds are not subject to such sales charges or fees. However, unlike
Class A shares of the Acquired Funds, which are subject to a sales charge upon
an exchange, there are no sales charges imposed on exchanges among the
SunAmerica Mutual Funds, including the Acquiring Funds.

In addition, Class B shares of the Acquiring Funds, as well as other
SunAmerica Mutual Funds, convert to Class A shares approximately eight years
after issuance. The time that a shareholder holds shares of an Acquiring Fund
will be taken into account in calculating the conversion period. Similarly, the
time that a Class B or Class II shareholder holds shares of an Acquiring Fund
will be taken into account when determining whether or not a CDSC will apply to
a redemption (six years for Class B; eighteen months for Class II). In
contrast, the time that a shareholder holds Class B or C shares of an Acquired
Fund does not count in determining the eight-year period for conversion of
Class B shares to Class A, or in determining whether the applicable period for
imposition of a CDSC has lapsed (six years for Class B shares; one year for
Class C shares).

The NAF Board also considered that the fee waivers and expense
reimbursements that are in place with respect to the Acquired Funds are only
effective through February 28, 2002 and that there can be no assurance that
AGAM would continue with these waivers and reimbursements past that date.

Moreover, an investor in an Acquiring Fund (or any fund in the SunAmerica
Fund Complex) would be subject to the imposition of a front-end sales charge in
connection with the purchase of Class A shares only once--at the time of
initial purchase and not at the time of each exchange.

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 past this
date. If shareholders approve the Reorganizations, the respective Combined
Funds expense structure will apply.

Based on the foregoing, together with other factors and information
considered to be relevant and recognizing that there can be no assurance that
the benefits described above would outweigh the higher expenses of being
shareholders in the Acquiring Funds, or that 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 portfolios of each of the Acquired Funds with those of
the respective Acquiring Funds to facilitate a smooth transition upon
consummation of the Reorganizations. Because the Acquired Funds and 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 each 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 Reorganization.

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 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.

To the extent that an Acquired Fund has loss carryforwards at the time of
the respective Reorganization, Acquired Fund shareholders may not be able to
benefit from such loss carryforwards after the Reorganizations.

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 and SunAmerica Money Market Fund have elected and
qualified, and SunAmerica Municipal Money Market Fund intends to elect and
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 June 30, 2001, and the capitalization of each
Combined Fund, on a pro forma basis, as if the Reorganizations had occurred on
that date. As the newly created portfolio of SunAmerica Money Market Funds,
Inc., the SunAmerica Municipal Money Market Fund had no assets as of such date.

NAF Money Market Fund SunAmerica Money Market Fund
----------------------------------------------- ------------------------------------
Institutional
Class A Class B Class C Class I Class A Class B Class II
----------- ---------- ---------- ------------- ------------ ----------- -----------

Total Net Assets........ $26,124,221 $9,869,751 $7,761,411 $6,894,324 $979,739,977 $37,666,545 $14,929,726
Shares Outstanding...... 26,123,508 9,869,522 7,760,808 6,895,384 979,738,643 37,666,515 14,929,726
Net Asset Value Per
Share.................. $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00 $ 1.00

Pro Forma Money Market Combined Fund
-------------------------------------------------
Class A Class B Class II Class I
-------------- ----------- ----------- ----------

Total Net Assets............. $1,005,864,198 $47,536,296 $22,691,137 $6,894,324
Shares Outstanding........... 1,005,862,151 47,536,037 22,690,534 6,895,384
Net Asset Value Per Share.... $ 1.00 $ 1.00 $ 1.00 $ 1.00

Pro Forma Municipal
NAF Municipal SunAmerica Municipal Money Market
Money Market Fund Money Market Fund Combined Fund
------------------------------ ------------------------ ------------------------------
Class A Class B Class C Class A Class B Class II Class A Class B Class II
---------- ---------- -------- ------- ------- -------- ---------- ---------- --------

Total Net Assets........ $4,283,016 $2,697,776 $130,729 $ 0 $ 0 $ 0 $4,283,016 $2,697,776 $130,729
Shares Outstanding...... 4,279,307 2,695,468 130,646 N/A N/A N/A 4,279,307 2,695,468 130,646
Net Asset Value Per
Share.................. $ 1.00 $ 1.00 $ 1.00 $ 0 $ 0 $ 0 $ 1.00 $ 1.00 $ 1.00

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 at 286 Congress Street, Boston, MA 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 and the respective Plan.

It is not anticipated that any matters other than the approval of the New
Investment Advisory Agreement, the New Subadvisory Agreement 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.

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

NAF Money Market Fund... 26,884,947.0010 9,512,800.7700 8,181,383.8800 75.0000 44,579,206.65
NAF Municipal Money
Market Fund............ 3,892,235.5200 2,570,558.1600 160,786.2800 0 6,623,579.96

Security Ownership of Certain Beneficial Owners and Management of the Funds

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

NAF Money Market Fund VALIC Seed Account 8.15% of Class 1.66% of Class B
Attn: Greg Kingston B, owned of
2919 Allen Pkwy #17-01 record
Houston, TX 77019-2142

NAF Municipal VALIC Seed Account 60.13% of Class 60.13% of Class A
Money Market Fund Attn: Greg Kingston A, owned of
2919 Allen Pkwy #17-01 record
Houston, TX 77019-2142

VALIC Seed Account 95.07% of Class 95.07% of Class B
Attn: Greg Kingston B, owned of
2919 Allen Pkwy #17-01 record
Houston, TX 77019-2142

Linda J. Vincent & 8.93% of Class 8.93% of Class A
Christopher Vincent & A, owned of
Jacob Vincent TOD record
39 Rivermeadow Dr.
Steep Falls, ME 04085-6842

Brad Coleman & Candace 36.35% of Class 36.35% of Class II
Coleman Jt Ten C, owned of
603 Westway Dr. record
Rockwall, TX 75087-3013

James Hooten 11.7% of Class 11.7% of Class II
62 Virginia St. C,
Racine, WI 53405-1946 owned of record

Judith Radwick & Michael 10.11% of Class 10.11% of Class II
Radwick JTWROS C,
73-4318 E. Keokeo St. owned of record
Kailua Kona, HI 96740-9509

Norbert Nolz Under MA TOD, 10.02% of Class 10.02% of Class II
Timothy Nolz & Dawn Nolz & C,
Kimberly Nolz owned of record
115 S. 2nd St.
Parkston, SD 57366-2126

Raymond Blevins & Sandra 7.27% of Class 7.27% of Class II
Blevins JTWROS C,
1401 Buffalo St. owned of record
Johnson City, TN 37604-
7301

Gary Wilbers 7.09% of Class 7.09% of Class II
PO Box 105216 C,
Jefferson City, MO 65110- owned of record
5216

Linda L. Morgan-Pitschka 6.89% of Class 6.89% of Class II
2311 W. 16th #101 C,
Spokane, WA 99224-4469 owned of record

SunAmerica Money Advest Inc. 206-13196-26 5.36% of Class 3.65% of Class II
Market Fund 90 Statehouse Square II,
Hartford, CT 06103 owned of record

--------

* 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, the SunAmerica Municipal Money Market Fund 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 Money Market
Funds, Inc. as a group (5 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 Money Market
Funds, 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 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 Investment Advisory Agreement, the New
Subadvisory Agreement 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 non-votes") will be counted as present for the
purposes of determining a quorum. Assuming the presence of a quorum,
abstentions and broker non-votes will have the same effect as a vote against
approval of the Plan.

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 Investment Advisory
Agreement, New Subadvisory Agreement or of the applicable Plan are not received
from the shareholders of the 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, located at 17 State Street, 27th Floor, New York, New York 10004
to aid in the solicitation of proxies at a cost estimated not to exceed $1,800,
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 Money Market Funds, 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 Money Market
Funds, 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., in 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 and the SunAmerica Money
Market 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)-(b) are approved at the Meeting, there will
likely not be any future shareholder meeting 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.

IA-3

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.

IA-4

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: _________________________________

IB-5

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.............................................. 4
c.Sections and Exhibits............................................. 5
d.Miscellaneous Terms............................................... 5
2. The Reorganization(s).............................................. 5
a.Transfer of Assets................................................ 5
b.Assumption of Liabilities......................................... 5
c.Issuance and Valuation of Corresponding Shares in the
Reorganization................................................. 5
d.Distribution of Corresponding Shares to the Acquired Fund
Shareholders................................................... 5
e.Interest; Proceeds................................................ 5
f.Valuation Time.................................................... 5
g.Evidence of Transfer.............................................. 6
h.Termination....................................................... 6
i.Separate Agreements; Reorganizations Not Conditioned on One
Another........................................................ 6
3. Representations and Warranties of the Acquired Fund................ 6
a.Formation and Qualification....................................... 6
b.Licenses.......................................................... 6
c.Authority......................................................... 6
d.Financial Statements.............................................. 7
e.Semi-Annual Report to Shareholders................................ 7
f.Prospectuses and Statements of Additional Information............. 7
g.Litigation........................................................ 7
h.Material Contracts................................................ 7
i.No Conflict....................................................... 7
j.Undisclosed Liabilities........................................... 7
k.Taxes............................................................. 7
l.Assets............................................................ 8
m.Consents.......................................................... 8
n.N-14 Registration Statement....................................... 8
o.Capitalization.................................................... 8
p.Books and Records................................................. 8
4. Representations and Warranties of the Acquiring Fund............... 8
a.Formation and Qualification....................................... 8
b.Licenses.......................................................... 9
c.Authority......................................................... 9
d.Financial Statements.............................................. 9
e.Semi-Annual Report to Shareholders................................ 9
f.Prospectuses and Statements of Additional Information............. 9
g.Litigation........................................................ 9
h.Material Contracts................................................ 10
i.No Conflict....................................................... 10
j.Undisclosed Liabilities........................................... 10
k.Taxes............................................................. 10
l.Consents.......................................................... 10
m.N-l4 Registration Statement....................................... 10
n.Capitalization.................................................... 10
o.Corresponding Shares.............................................. 11

Page No.
--------

5. Covenants of the Acquired Fund and the Acquiring Fund.............. 11
a.Special Shareholders' Meeting..................................... 11
b.Unaudited Financial Statements.................................... 11
c.Share Ledger Records of the Acquiring Fund........................ 12
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....................................................... 12
i.Combined Proxy Statement and Prospectus Mailing................... 12
j.Confirmation of Tax Basis......................................... 12
k.Shareholder List.................................................. 12
l.Class I Shares; New Series........................................ 12
6. Closing Date....................................................... 13
7. Conditions of the Acquired Fund.................................... 13
a.Representations and Warranties.................................... 13
b.Performance....................................................... 13
c.Shareholder Approval.............................................. 13
d.Approval of Board of Directors.................................... 13
e.Deliveries by the Acquiring Fund.................................. 13
f.No Material Adverse Change........................................ 14
g.Absence of Litigation............................................. 14
h.Proceedings and Documents......................................... 14
i.N-14 Registration Statement; Acquiring Fund Post-Effective
Amendment...................................................... 14
j.Compliance with Laws; No Adverse Action or Decision............... 14
k.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................................... 15
f.No Material Adverse Change........................................ 16
g.Absence of Litigation............................................. 16
h.Proceedings and Documents......................................... 16
i.N-l4 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.Dividends......................................................... 16
9. Termination, Postponement and Waivers.............................. 16
a.Termination of Agreement.......................................... 16
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 under Massachusetts Law.............................. 18
a.Obligations....................................................... 18
b.Further Assurances................................................ 18
c.Notices........................................................... 18
d.Entire Agreement.................................................. 18
e.Amendment......................................................... 18

Page No.
--------

f.Governing Law...................................................... 19
g.Assignment......................................................... 19
h.Costs of the Reorganization........................................ 19
i.Severability....................................................... 19
j.Headings........................................................... 19
k.Counterparts....................................................... 19

iii

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 MONEY MARKET FUNDS, INC., a Maryland corporation, on behalf of each
Acquiring Fund (as defined herein), each a separate investment portfolio of
SunAmerica Money Market Funds, 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 Money Market Funds, 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:
-------------- ---------------

Money Market Fund (the "NAF SunAmerica Money Market Fund (the "SunAmerica
Money Market Fund") Money Market Fund")

Municipal Money Market Fund (the SunAmerica Municipal Money Market Fund (the
"NAF Municipal Money Market "SunAmerica Municipal Money Market Fund")
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, $.001 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 Money Market Fund in respect of the
Money Market Funds Reorganization and the NAF Municipal Money Market Fund
in respect of the Municipal Money Market 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 Money Market Fund in respect
of the Money Market Funds Reorganization and the SunAmerica Municipal Money
Market Fund in respect of the Municipal Money Market Funds Reorganization.

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

"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 Money Market Fund in the case of the Money Market Funds
Reorganization and (ii) the NAF Municipal Money Market Fund in the case of
the Municipal Money Market 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 Money Market Fund in
the case of the Money Market Funds Reorganization and (ii) the NAF
Municipal Money Market Fund in the case of the Municipal Money Market 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.

"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 Money Market Fund in the case of the Money Market Funds
Reorganization and (ii) the SunAmerica Municipal Money Market Fund in the
case of the Municipal Money Market 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.

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

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

"NAF Money Market Fund" has the meaning ascribed thereto under the
heading "Plans of Reorganization."

"NAF Municipal Money Market 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 second
paragraph under the heading "Plans of Reorganization" hereof. For purposes
of this Agreement, the term "Reorganization" shall refer to the Money
Market Funds Reorganization or the Municipal Money Market 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 Money Market
Funds, Inc. and the Acquiring Funds.

"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. "

"SunAmerica Money Market Fund" has the meaning ascribed thereto under
the heading "Plans of Reorganization."

"SunAmerica Municipal Money Market Fund" has the meaning ascribed
thereto under the heading "Plans of Reorganization."

"SunAmerica Money Market Funds, Inc. Articles of Incorporation" shall
mean the Articles of Incorporation of SunAmerica Money Market Funds, Inc.,
dated as of July 20, 1983, as amended or supplemented from time to time.

"SunAmerica Money Market Funds, Inc. Prospectuses" shall mean the
prospectuses relating to the SunAmerica Money Market Funds, Inc., dated
April 30, 2001 in the case of Class A, Class B and Class II Shares of the
SunAmerica Money Market Fund, and the preliminary prospectus contained in
the SunAmerica Money Market Funds, Inc. Post-Effective Amendment in the
case of Class I Shares of the SunAmerica Money Market Fund and Class A,
Class B and Class II Shares of the SunAmerica Municipal Money Market Fund,
in each case as amended and supplemented.

"SunAmerica Money Market Funds, Inc. Statements of Additional
Information" shall mean the statement of additional information relating to
the SunAmerica Money Market Funds, Inc., dated April 30, 2001 in the case
of the Class A, Class B and Class II Shares of the SunAmerica Money Market
Fund, and the preliminary statement of additional information contained in
the SunAmerica Money Market Funds, Inc. Post-Effective Amendment in the
case of Class I Shares of the SunAmerica Money Market Fund and Class A,
Class B and Class II Shares of the SunAmerica Municipal Money Market Fund,
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 Money Market Funds, Inc.
Prospectuses and the SunAmerica Money Market Funds, 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
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 Money Market Funds Reorganization and (ii) the Municipal Money Market 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 Commonwealth
of Massachusetts, 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 Money Market Funds, 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 NAF Money Market 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. The NAF Municipal Money Market Fund is authorized
to issue an unlimited number of full and fractional shares of beneficial
interest, par value $0.001 per share, divided into three classes designated
Class A, Class B and Class C 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 Money Market Funds, Inc., a corporation duly
incorporated, 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

Money Market Funds, 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 SunAmerica Municipal Money
Market 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 Money Market Funds, 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 Money Market Funds,
Inc. is duly registered under the Investment Company Act as an open-end
management investment company (File No. 811-3807), and such registration has
not been revoked or rescinded and is in full force and effect. The Acquiring
Fund has elected and qualified for the special tax treatment afforded to RICs
under Sections 851-855 of the Code at all times since its inception (if
applicable) and intends to continue to so qualify both until consummation of
the Reorganization and thereafter.

c. Authority. SunAmerica Money Market Funds, 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 Money Market Funds, 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. Financial Statements. In the case of the Money Market Funds
Reorganization, the Acquired Fund has been furnished with an accurate, correct
and complete statement of assets and liabilities and a schedule of Investments
of the SunAmerica Money Market Fund as of December 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 SunAmerica Money Market 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 Acquired Fund has been furnished
with the SunAmerica Money Market Fund's Semi-Annual Report to Shareholders for
the six months ended June 30, 2001, and the unaudited financial statements
appearing therein 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.

f. Prospectuses and Statements of Additional Information. The Acquired Fund
has been furnished with the SunAmerica Money Market Funds, Inc. Prospectuses
and the SunAmerica Money Market Funds, 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.

g. 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.

h. Material Contracts. There are no material contracts outstanding to which
SunAmerica Money Market Funds, Inc. on behalf of the Acquiring Fund is a party
that have not been disclosed in the N-14 Registration Statement, the SunAmerica
Money Market Funds, Inc. Prospectuses, or the SunAmerica Money Market Funds,
Inc. Statements of Additional Information.

i. No Conflict. The execution and delivery of this Agreement by SunAmerica
Money Market Funds, 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 Money Market Funds, 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 Money Market Funds, 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.

j. Undisclosed Liabilities. In the case of the Money Market Funds
Reorganization, the Acquiring 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 as an
investment company since June 30, 2001 and those incurred in connection with
the Reorganization.

k. Taxes. In the case of the Money Market Funds Reorganization, the
SunAmerica Money Market 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 SunAmerica Money Market Fund
have been adequately provided for on its books, and no tax deficiency or
liability of the SunAmerica Money Market 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. 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 have the Acquiring Fund authorize and offer Class A, Class B, Class II
and/or Class I shares, as applicable, and (iii) if necessary, receipt of a
Section 17 Order.

m. N-14 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.

n. Capitalization. Under its Articles of Incorporation, SunAmerica Money
Market Funds, Inc. is authorized to issue ten billion (10,000,000,000) shares
of common stock, of which three billion (3,000,000,000) shares have been
divided and classified as the SunAmerica Money Market Fund and one hundred
million (100,000,000) shares have been divided and classified as the SunAmerica
Municipal Money Market Fund. The

SunAmerica Money Market Fund is divided into four classes of shares, designated
Class A, Class B, Class II and Class I, consisting of one billion
(1,000,000,000) Class A shares, one billion (1,000,000,000) Class B shares,
five hundred million (500,000,000) Class II shares and five hundred million
(500,000,000) Class I shares, in each case par value $0.001 per share. The
SunAmerica Municipal Money Market Fund is divided into four classes of shares,
designated Class A, Class B, Class II and Class I, consisting of twenty-five
million (25,000,000) Class A shares, twenty-five million (25,000,000) Class B
shares, twenty-five million (25,000,000) Class II shares and twenty-five
million (25,000,000) Class I shares, in each case par value $0.001 per share.

All issued and outstanding shares of the Acquiring Fund, if any, are duly
authorized, validly issued, fully paid and nonassessable 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.

o. 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 have been, or will be, as
applicable, 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
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 and the SunAmerica Money Market
Fund each covenants and agrees to operate its respective 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 Money Market Funds,
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. In the case of the Money Market Funds Reorganization, the
Acquired Fund and SunAmerica Money Market Fund each 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. In connection with this provision,
SunAmerica Money Market Fund and the Acquired Fund agree to cooperate with each
other in filing any tax return, amended return or claim for refund, determining
a liability for taxes or a right to a refund of taxes or participating in or
conducting any audit or other proceeding in respect of 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. Class I Shares; New Series. SunAmerica Money Market Funds, Inc. on behalf
of the Acquiring Fund shall (i) 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 Class A, Class B, and Class II Shares of the SunAmerica
Municipal Money Market Fund in the case of the Municipal Money Market Funds
Reorganization and the Class I Shares of the SunAmerica Money Market Fund in
the case of the Money Market Funds Reorganization, in each case for sale under
the Securities Act prior to the Closing Date, and (ii) prior to the Closing
Date, amend or establish, as applicable, the Acquiring Fund's plan under Rule
18f-3 under the Investment Company Act to reflect the addition of such Shares
and take such other steps as may be necessary to establish a new class of
shares of such Acquiring Fund.

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, New York
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 Money Market Funds, Inc., on behalf of the Acquiring Fund, including
a majority of the Directors who are not "interested persons" of North American
Funds or SunAmerica Money Market Funds, 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 Money Market Funds, 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
the 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, in the case of the Money Market Funds Reorganization, (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. No Material Adverse Change. There shall have occurred no material adverse
change in the financial position of the Acquiring Fund since June 30, 2001
other than, if applicable, 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 Acquiring Fund's customary operating
expenses, each in the ordinary course of business.

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 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.

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 Acquiring Fund or the Acquired Fund, contemplated by the Commission.

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.

k. 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 Money Market Funds, 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. Dividends. Prior to the Closing Date, if applicable, the Acquired Fund
shall have declared a dividend or dividends which, together with all such
previous dividends, shall have the effect of distributing to its shareholders
all of its investment company taxable income as of the Closing Date, if any
(computed without regard to any deduction for dividends paid), and all of its
net capital gain, if any, realized as of the Closing Date.

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 Money Market Funds, 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 Money Market
Funds, 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 Money Market Funds, 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, directors or agent
of the Acquired Fund or the Acquiring Fund, or of North American Funds or
SunAmerica Money Market Funds, 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 directors 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: SunAmerica Money Market Funds, 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 Reorganizations are 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
Money Market Fund

Municipal Money Market Fund

By: _________________________________
Name:
Title: By: __________________________________
Name:
Title:

Attest: Sunamerica Money Market Funds, Inc.
on

Behalf of
By: _________________________________ Sunamerica Money Market Fund
Name: Sunamerica Municipal Money Market
Title: Fund

By: __________________________________
Name:
Title:

STATEMENT OF ADDITIONAL INFORMATION

SUNAMERICA MONEY MARKET FUNDS, 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 have been filed with
the Securities and Exchange Commission by SunAmerica Money Market Funds, Inc.
(sometimes referred to herein as the "Registrant") with respect to the matters
described in "General Information" below. Copies of the Proxy Statement and
Prospectus may be obtained at no charge upon request by writing to the
Registrant at the address indicated above or by calling toll-free 1-800-858-
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 April 30,
2001, as supplemented, and the Annual Report to Shareholders of the Existing
Acquiring Fund (as defined below) for the year ended December 31, 2000 and the
Semi-Annual Report to Shareholders of the Existing Acquiring Fund for the six
months ended June 30, 2001. 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 Existing Acquiring Fund,
dated April 30, 2001, as supplemented.

. The Annual Report to Shareholders of the Existing Acquiring Fund for the
year ended December 31, 2000.

. The Semi-Annual Report to Shareholders of the Existing Acquiring Fund for
the six months ended June 30, 2001.

. 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 combined 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 (each an "Acquired Fund" and
collectively, the "Acquired Funds"), are being asked to approve or disapprove
(i) 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 as 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 thereof, the terms of which are the same in all
material respects as the previous subadvisory agreement between AGAM and AGIM.
In addition, shareholders of each Acquired Fund are being asked to approve or
disapprove an Agreement and Plan of Reorganization (each a "Plan") between each
of the Acquired Funds and the respective investment portfolio of SunAmerica
Money Market Funds, Inc., a Maryland corporation, set forth below (each an
"Acquiring Fund," and collectively, the "Acquiring Funds"):

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

Money Market Fund........................ SunAmerica Money Market Fund
Municipal Money Market Fund.............. SunAmerica Municipal Money Market 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. Because all of the Funds seek to
maintain a price per share of $1.00, a shareholder should end up with the same
number of shares. In any event, 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 10:00
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
Reorganization relating to the Money Market Funds are not included because the
net assets of the Money Market Fund of North American Funds are less than 10%
of the net assets of the SunAmerica Money Market Fund. Unaudited Pro forma
financial statements reflecting consummation of the Reorganization relating to
the Municipal Money Market Funds are not included because the SunAmerica
Municipal Money Market Fund is a newly created investment portfolio of
SunAmerica Money Market Funds, 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
report 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.

Acquiring Funds

Audited financial statements and accompanying notes for the fiscal year
ended December 31, 2000 for the Existing Acquiring Fund and the independent
auditor's report thereon are incorporated herein by reference from the Existing
Acquiring Fund's Annual Report to Shareholders, which accompanies this
Statement of Additional Information. Unaudited financial statements and
accompanying notes for the six months ended June 30, 2001 for the Existing
Acquiring Fund are incorporated herein by reference from the Existing Acquiring
Fund's 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 Section 5.1 of the Registrant's By-Laws which is set
forth below.

5.1 Indemnification of Directors, Officers, Employees and Agents

1. 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 contendre 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.

2. 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").

3. 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.

4. (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.

(3) Notwithstanding the provisions of Section 5.1 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

C-1

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.

5. 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.

6. The indemnification provided by Section 5.1 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.

7. 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.

8. Nothing contained in Section 5.1 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

C-2

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 5.3 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 Director 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 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 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

C-3

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,
officer, or controlling person of the Registrant and the principal
underwriter in

C-4

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. (1)
(b) Articles of Amendment dated September 23, 1993. (1)
(c) Articles Supplementary dated September 27, 2001.*

2. By-laws of the Registrant. (1)

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. Instrument defining rights of Shareholders (incorporated by
reference to Exhibits 1 and 2 above).

6. Investment Advisory and Management Agreement between the
Registrant and SunAmerica Asset Management Corp. (2)

7. (a) Distribution Agreement between the Registrant and SunAmerica
Capital Services, Inc. (2)
(b) Form of Dealer Agreement. (3)

8. Directors'/Trustees' Retirement Plan. (3)

9. Custodian Agreement between the Registrant and State Street Bank
and Trust Company. (4)

10. (a) Form of Distribution Plan pursuant to Rule 12b-1 (Class A
shares). (2)
(b) Form of Distribution Plan pursuant to Rule 12b-1 (Class B
shares). (2)
(c) Form of Distribution Plan pursuant to Rule 12b-1 (Class II
shares). (2)
(d) Plan pursuant to Rule 18f-3. (3)

11. Opinion and consent of Robert M. Zakem, Esq.*

12. (a) Opinion and consent of Shearman & Sterling, counsel to the
Registrant, regarding certain tax matters relating to the
Reorganization between the Money Market Fund of North
American Funds and the SunAmerica Money Market Fund of
SunAmerica Money Market Funds, Inc. (5)
(b) Opinion and consent of Shearman & Sterling, counsel to the
Registrant, regarding certain tax matters relating to the
Reorganization between the Municipal Money Market Fund of
North American Funds and the SunAmerica Municipal Money
Market Fund of SunAmerica Money Market Funds, Inc. (5)

13. (a) Transfer Agency and Service Agreement between the Registrant
and State Street Bank and Trust Company. (4)
(b) Service Agreement, as amended, between the Registrant and
SunAmerica Fund Services, Inc. (2)

14. (a) Consents of PricewaterhouseCoopers LLP.*
(b) Consent of Ernst & Young LLP.*

15. Not applicable.

16. Power of Attorney.*

17. (a) Prospectus, dated April 30, 2001, of SunAmerica Money Market
Funds, Inc., as supplemented. (6)
(b) Prospectus dated March 1, 2001 of North American Funds (Class
A shares, Class B shares and Class C shares). (7)
(c) Prospectus dated March 1, 2001 of North American Funds
(Institutional Class I shares). (7)
(d) Statement of Additional Information, dated April 30, 2001, of
SunAmerica Money Market Funds, Inc., as supplemented. (6)

C-6

Exhibit No.
-----------

(e) Statement of Additional Information dated March 1, 2001 of
North American Funds. (7)
(f) Semi-Annual Report to Shareholders of SunAmerica Money Market
Funds, Inc. for the six-month period ended June 30, 2001. (8)
(g) Semi-Annual Report to Shareholders of North American Funds
for the six-month period ended April 30, 2001. (9)
(h) Annual Report to Shareholders of SunAmerica Money Market
Funds, Inc. for the year ended December 31, 2000. (10)
(i) Annual Report to Shareholders of North American Funds for the
year ended October 31, 2000. (11)
(j) President's Letter. *
(k) Q&A. *
(l) Forms of Proxy Cards. *
(m) Form of Investment Advisory Agreement between North American
Funds and American General Asset Management Corp. (filed
herein as Exhibit 1A to the Proxy Statement and Prospectus
contained in this Registration Statement).
(n) 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).

--------
*Filed herewith.
(1) Previously filed with Post-Effective Amendment No. 17 to the Registrant's
Registration Statement on Form N-1A (File No 2-85370) on April 26, 1996,
and incorporated herein by this reference.
(2) Previously filed with Post-Effective Amendment No. 23 to the Registrant's
Registration Statement on Form N-1A (File No. 2-85370) on April 30, 1999,
and incorporated herein by this reference.
(3) Previously filed with Post-Effective Amendment No. 19 to the Registrant's
Registration Statement on Form N-1A (File No. 2-85370) on July 21, 1997,
and incorporated herein by this reference.
(4) Previously filed with Post-Effective Amendment No. 16 to the Registrant's
Registration Statement on Form N-1A (File No. 2-85370) on April 27, 1995
and incorporated herein by this reference.
(5) To be filed by amendment.

(6) Previously filed with Post-Effective Amendment No. 25 to the Registrant's
Registration Statement on Form N-1A (File No. 2-85370) on April 30, 2001,
and incorporated herein by this reference.

(7) Previously filed with Post-Effective Amendment No. 35 to North American
Funds' Registration Statement on Form N-1A (File No. 33-27958) on March 1,
2001, and incorporated herein by this reference.

(8) Previously filed on Form N-30D of SunAmerica Money Market Funds, Inc.
(File No. 811-3807) on August 29, 2001, and incorporated herein by this
reference.

(9) Previously filed on Form N-30D of North American Funds (File No. 811-
05797) on July 3, 2001, and incorporated herein by this reference.
(10) Previously filed on Form N-30D of SunAmerica Money Market Funds, Inc.
(File No. 811-3807) on February 28, 2000, and incorporated herein by this
reference.
(11) Previously filed on Form N-30D of North American Funds (File No. 811-
05797) on January 17, 2001, and incorporated herein by this reference.

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 opinions of counsel received as to certain tax matters, within a
reasonable time after receipt of such opinion.

C-7

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 Money Market Funds, Inc.
(Registrant)

/s/ Peter A. Harbeck
By: _________________________________
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

/s/ Peter A. Harbeck September 28, 2001
*By: _________________________________
(Peter A. Harbeck,
Attorney-in-fact)

C-8

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.

16. Power of Attorney.

17. (j)President's Letter.
(k)Q&A.
(l)Forms of Proxy Cards.