BRAZOS MUTUAL FUNDS
Supplement dated August 16, 1999 to the Prospectus dated
February 12, 1999
The references to "Firstar Mutual Fund Services, LLC"
or "Firstar Bank Milwaukee N.A." on the cover page and page
20 of the Prospectus should be replaced with "State Street
Bank and Trust Company." Except as indicated below, the
references to "Firstar Mutual Fund Services" on the back
cover page and page 22 of the Prospectus should be replaced
with "SunAmerica Fund Services, Inc."
The address of the transfer agent on the cover page of
the Prospectus should be replaced with the following: 1776
Heritage Drive, North Quincy, MA 02171. Except as indicated
below, the address of Brazos Mutual Funds should be
replaced with the following: Mutual Fund Operations, 3rd
Floor, The SunAmerica Center, 733 Third Avenue, New York, NY
10017-3204.
The sixth bullet point under the column heading
"Opening an account" and the fourth bullet point under the
column heading "Adding to an account" on page 20 of the
Prospectus should be replaced in their entirety with the
following:
Instruct your bank to wire the amount of your
investment to:
State Street Bank and Trust Company
Boston, MA
ABA #0110-00028
DDA #99029712
Attn: Name of Portfolio
FBO: Shareholder Name/
Account Number
The column headings "Mail to," "Wire Information" and
"Overnight or Express Mail to" and the text in the boxes
under these column headings on page 21 of the Prospectus
should be replaced in their entirety with the following:
Mailing Addresses:
For initial investments and overnight or
express mail:
Brazos Mutual Funds
Mutual Fund Operations, 3rd Floor
The SunAmerica Center
733 Third Avenue
New York, NY 10017-3204
For subsequent investments:
Non-Retirement Accounts:
Brazos Mutual Funds
c/o NFDS
P.O. Box 219373
Kansas City, MO 64121-9373
Retirement Accounts:
Brazos Mutual Funds
Mutual Fund Operations, 3rd Floor
The SunAmerica Center
733 Third Avenue
New York, NY 10017-3204
The reference to "Rafferty Capital Markets, Inc., 550
Mamaroneck Avenue, Harrison, NY 10528" under the heading
"Distributor" on page 22 of the Prospectus should be
replaced with the following: SunAmerica Capital Services,
Inc., The SunAmerica Center, 733 Third Avenue, New York, NY
10017-3204.
The fourth sentence under the heading "Automatic
Investment Plan"on page 22 of the Prospectus should be
replaced in its entirety with the following:
The purchase of Portfolio shares will be effected
at their offering price at 4 p.m., Eastern time,
on the date of the month designated by the
shareholder.
The phrase "or complete a stock power" in the first
bullet point under the column heading "To sell some or all
of your shares" on page 23 of the Prospectus should be
deleted in its entirety.
The third bullet point under the column heading "To
sell some or all of your shares" on page 23 of the
Prospectus should be replaced in its entirety with the
following:
Mail the materials to:
Brazos Mutual Funds
Mutual Fund Operations, 3rd Floor
The SunAmerica Center
733 Third Avenue
New York, New York 10017-3204.
The fifth bullet point under the column heading "To
sell some or all of your shares" on page 23 of the
Prospectus should be replaced in its entirety with the
following:
For automated service 24 hours a day using
your touch-tone phone, dial 1-800-654-4760.
The sixth bullet point under the column heading "To
sell some or all of your shares" on page 23 of the
Prospectus should be replaced in its entirety with the
following:
To place an order or to speak to a
representative from Brazos Mutual Funds, call
1-800-426-9157 between 8:30 a.m. and 7:00
p.m. (Eastern time) on most business days.
References to "electronic funds transfer" or "EFT"
(including the tenth bullet point under the column heading
"To sell some or all of your shares") on page 24 of the
Prospectus are deleted in their entirety.
The first paragraph under the heading "Signature
Guarantees" on page 24 of the Prospectus should be replaced
in its entirety with the following:
Signature guarantees are required for the
following redemptions:
redemptions where the proceeds are to be sent
to someone other than the registered
shareholder(s);
redemptions where the proceeds are to be sent
to someplace other than the registered
address;
share transfer requests; or
redemption requests that exceed $100,000.
BRAZOS MUTUAL FUNDS
Supplement dated August 16, 1999 to the
Statement of Additional Information dated February 12, 1999
On June 30, 1999, John McStay Investment Counsel, L.P.,
which acts as the investment adviser to each portfolio of
Brazos Mutual Funds (the "Company"), reorganized as a
Delaware limited liability company ("New JMIC") and
completed the sale of an 80% managing membership interest in
New JMIC to American International Group, Inc. ("AIG")
resulting in New JMIC becoming a majority owned indirect
subsidiary of AIG and minority owned by the employees of New
JMIC. In connection therewith, on June 25, 1999,
shareholders of each Portfolio of the Company approved new
investment advisory and management agreements with New JMIC
and also approved changing the fundamental investment
restrictions relating to the ability to engage in borrowing
and lending transactions with respect to each Portfolio.
Although the investment advisory fee waivers will no longer
be in place, the fees will not exceed the expense caps
currently in place for each Portfolio due to a voluntary
expense reimbursement by New JMIC or its affiliates.
As a result of the reorganization described above,
arrangements for the administration, distribution, transfer
agency and shareholder servicing, and custody and fund
accounting of the Portfolios of the Company have been
changed as follows:
(i) SunAmerica Asset Management Corp. ("SAAMCo") will
act as Administrator of each Portfolio of the Company
pursuant to the Administration Agreement between SAAMCo
and the Company;
(ii) SunAmerica Capital Services, Inc. ("SACS") will
act as Distributor for each Portfolio of the Company
pursuant to the Distribution Agreement between SACS and
the Company;
(iii) SunAmerica Fund Services, Inc. ("SAFS") will
provide transfer agency and shareholder services with
respect to each Portfolio of the Company pursuant to
the Service Agreement between SAFS and the Company; and
(iv) State Street Bank and Trust Company ("State
Street") will serve as custodian and fund accountant of
the Portfolios and as transfer agent, together with its
affiliate, National Financial Data Services ("NFDS"),
pursuant to the Custodian Contract and the Transfer
Agency Agreement, each between the Company and State
Street.
SAAMCo, SACS and SAFS are all affiliates of each other, of
New JMIC, and of AIG.
Under the Administration Agreement, SAAMCo will provide
certain administrative services similar to those previously
provided by Firstar Mutual Fund Services, LLC ("Firstar").
For its services, SAAMCo will receive fees that are
identical to those fees which were paid to Firstar. SAAMCo
is located at The SunAmerica Center, 733 Third Avenue, New
York, New York 10017. Under the Distribution Agreement,
SACS will provide services similar to those previously
provided by Rafferty Capital Markes, Inc. ("Rafferty").
Like Rafferty, SACS will receive no compensation for the
distribution of shares of the Portfolios, except for
reimbursement by the Adviser of out-of-pocket expenses.
SACS is located at The SunAmerica Center, 733 Third Avenue,
New York, New York 10017. Under the Service Agreement,
SAFS will assist State Street and NFDS in connection with
certain services previously provided by Firstar. For its
services, SAFS will receive a fee, which represents the full
cost of providing shareholder and transfer agency services,
at the same cost basis previously charged by Firstar. SAFS
will pay a fee to State Street and NFDS (other than out-of-
pocket charges of the Transfer Agent which are paid by the
Company). SAFS is located at The SunAmerica Center, 733
Third Avenue, New York, NY 10017. Under the Custodian
Contract and the Transfer Agency Agreement, State Street,
1776 Heritage Drive, North Quincy, MA 02171, will provide
custodial and fund accounting services similar to those
previously provided by Firstar Bank Milwaukee, N.A. and
Firstar, respectively. Transfer agent functions previously
provided by Firstar will be performed for State Street by
NFDS, P.O. Box 219373, Kansas City, MO 64121-9373.
To obtain a copy of the Prospectus, please call the
Company at 1-800-426-9157. Investor correspondence should
be directed to the Brazos Mutual Funds, c/o SunAmerica Fund
Services, Inc., The SunAmerica Center, 733 Third Avenue,
New York, NY 10017. Exchange requests should be made by
calling 1-800-426-9157 or by writing to Brazos Mutual Funds
at the aforementioned address.
The following Trustees and Officers and their
respective positions with the Company and principal
occupations during the past 5 years should be added to the
list of Trustees and Officers under the heading "Management
of the Fund Trustees And Officers" on page 12 of the
Statement of Additional Information:
George W. Gau
8009 Long Canyon Dr.
Austin, TX 78730
Age 51
Trustee of the Company;Professor of Finance, George S.
Watson Centennial Professor in Real Estate, College and
Graduate School of Business, University of Texas at Austin
since 1988; J. Ludwig Mosle Centennial Memorial Professor in
Investments and Money Management, since 1996; and Chairman
of the Board and Chief Executive Officer, The MBA Investment
Fund, L.L.C., a $10 million fund that is the first private
investment company to be managed by students, since 1994.
*Peter C. Sutton
The SunAmerica Center
733 Third Avenue
New York, NY 10017
Age 34
Vice President and Assistant Treasurer of the Company;
Senior Vice President, SAAMCo, since April 1997;
Treasurer, SunAmerica Equity Funds, SunAmerica Income Funds,
SunAmerica Money Market Fund and Anchor Series Trust, since
February 1996; Vice President and Assistant Treasurer of
SunAmerica Series Trust and Anchor Pathway Fund, since 1994;
Vice President, Seasons Series Trust, since April 1997;
formerly, Vice President, SAAMCo, from 1994 to 1997;
Controller, SunAmerica Mutual Funds and Anchor Series Trust,
from March 1993 to February 1996.
*Robert M. Zakem
The SunAmerica Center
733 Third Avenue
New York, NY 10017
Age 41
Vice President and Assistant Secretary of the Company;
Senior Vice President and General Counsel, SAAMCo, since
April 1993; Executive Vice President, General Counsel and
Director, SACS, since August 1993; Vice President,General
Counsel and Assistant Secretary, SAFS, since January 1994;
Vice President, SunAmerica Series Trust, Anchor Pathway Fund
and Seasons Series Trust; Secretary and Chief Compliance
Officer, Anchor Series Trust, SunAmerica Equity Funds,
SunAmerica Income Funds and SunAmerica Money Market Fund,
since 1993; Secretary and Chief Compliance Officer, Style
Select Series, Inc., since 1996; Secretary, SunAmerica
Strategic Investment Series, Inc., since 1998.
The first two sentences in the paragraph under the
heading "Management of the Fund Remuneration Of Trustees
And Officers" on page 12 of the Statement of Additional
Information should be replaced in their entirety with the
following:
The Company pays each Trustee, who is not also an
officer or affiliated person, a $1,250 quarterly
retainer fee per Portfolio which currently amounts to
$5,000 per quarter. In addition, each unaffiliated
Trustee receives a fee of $1,250 per regular meeting
and a fee of $1,250 per special meeting, and
reimbursement for travel and other expenses incurred
while attending Board meetings. The fees are
aggregated for all the Trustees and allocated
proportionately among the Portfolios of the Company.
The following language should be added to the table
under the heading "Compensation Table" on page 13 of the
Statement of Additional Information:
Since Mr. Gau joined the Board of Trustees in May of
1999, he was not compensated during
the fiscal year ended November 30, 1998 for his
services to the Company.
The second sentence in the first paragraph under the
heading "Purchase of Shares" on page 19 of the Statement of
Additional Information should be replaced in its entirety
with the following:
Effective September 15, 1999, initial investments
in the shares of the Portfolios must be at least
$1,000,000, and subsequent minimum investments must be
at least $1,000, except for the Brazos Micro Cap Growth
Portfolio, which has an initial investment of $50,000.
Shares may be purchased and subsequent investments may
be made without being subject to the minimum or
subsequent investment limitations at the discretion of
the officers of the Company.
Shares may be purchased and subsequent investments
may be made by principals, officers, associates and
employees of the Company and its affiliates, their
families and their business or personal associates,
either directly or through their individual retirement
accounts, and by any New JMIC pension or profit-sharing
plan, without being subject to the minimum or
subsequent investment limitations.
The following clause should be added to the second
sentence in the first paragraph under the heading
"Redemption of Shares Signature Guarantees" on page 21 of
the Statement of Additional Information: "or (3) redemption
requests that exceed $100,000."
