<PAGE>
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PROSPECTUS
JULY 5, 2000
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[LOGO]
SEASONS SERIES TRUST
- MULTI-MANAGED GROWTH PORTFOLIO
- MULTI-MANAGED MODERATE GROWTH PORTFOLIO
- MULTI-MANAGED INCOME/EQUITY PORTFOLIO
- MULTI-MANAGED INCOME PORTFOLIO
- ASSET ALLOCATION: DIVERSIFIED GROWTH PORTFOLIO
- STOCK PORTFOLIO
THE SECURITIES AND EXCHANGE COMMISSION HAS NOT
APPROVED OR DISAPPROVED THESE SECURITIES OR PASSED
UPON THE ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
<PAGE>
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TABLE OF CONTENTS
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<TABLE>
<S> <C>
TRUST HIGHLIGHTS............................................ 3
Q&A................................................. 3
MORE INFORMATION ABOUT THE PORTFOLIOS....................... 10
Investment Strategies............................... 10
Additional Information about the Seasons
Portfolios....................................... 10
GLOSSARY.................................................... 13
Investment Terminology.............................. 13
Risk Terminology.................................... 15
MANAGEMENT.................................................. 17
Investment Adviser and Manager...................... 17
Information about the Subadvisers................... 18
Portfolio Management................................ 19
Custodian, Transfer and Dividend Paying Agent....... 20
ACCOUNT INFORMATION......................................... 21
Transaction Policies................................ 21
Dividend Policies and Taxes......................... 21
FINANCIAL HIGHLIGHTS........................................ 22
FOR MORE INFORMATION........................................ 23
</TABLE>
2
<PAGE>
MANAGED COMPONENTS -- the four distinct, actively managed investment components
in which all of the assets of the Multi-Managed Seasons Portfolios are invested.
The percentage each Multi-Managed Seasons Portfolio allocates to a Managed
Component differs based upon the Portfolio's investment objective.
CAPITAL APPRECIATION/GROWTH is an increase in the market value of securities
held.
INCOME is interest payments from bonds or dividends from stocks.
YIELD is the annual dollar income received on an investment expressed as a
percentage of the current or average price.
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TRUST HIGHLIGHTS
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The following questions and answers are designed to provide you with information
about Seasons Series Trust (the "Trust"), and to give you an overview of certain
of the Trust's separate investment series ("Portfolios") and their investment
goals and principal strategies. This Prospectus describes six of the Portfolios,
which we call the "Seasons Portfolios," that are available through the Seasons
Variable Annuity Contract. More complete investment information is provided in
the chart, under "More Information About the Portfolios," which is on page 10,
and the glossary that follows on page 13.
Q&A
Q: WHAT ARE THE PORTFOLIOS' INVESTMENT GOALS AND
STRATEGIES?
A: Each Portfolio operates as a separate mutual fund
and has its own investment goal and a strategy for
pursuing it. A Portfolio's investment goal may be
changed by the Board of Trustees without
shareholder approval, but you will be notified of
any change. There can be no assurance that any
Portfolio's investment goal will be met or that the
net return on an investment in a Portfolio will
exceed what could have been obtained through other
investment or savings vehicles.
<TABLE>
<CAPTION>
<S> <C> <C>
SEASONS PORTFOLIOS
PORTFOLIO INVESTMENT GOAL STRATEGY
MULTI-MANAGED GROWTH long-term growth of asset allocation
PORTFOLIO capital through Managed
Components
MULTI-MANAGED long-term growth of asset allocation
MODERATE GROWTH capital, with through Managed
PORTFOLIO capital Components
preservation as a
secondary objective
MULTI-MANAGED conservation of asset allocation
INCOME/EQUITY principal while through Managed
PORTFOLIO maintaining some Components
potential for
long-term growth of
capital
MULTI-MANAGED INCOME capital asset allocation
PORTFOLIO preservation through Managed
Components
ASSET ALLOCATION: capital investment
DIVERSIFIED GROWTH appreciation primarily through a
PORTFOLIO strategic
allocation of
approximately 80%
(with a range of
65-95%) of its
assets to equity
securities and
approximately 20%
(with a range of
5-35%) of its
assets to fixed
income securities
STOCK PORTFOLIO long-term capital investment
appreciation, with primarily in the
a secondary common stocks of a
objective of diversified group
increasing dividend of well-established
income growth companies
</TABLE>
3
<PAGE>
Each of the Seasons MULTI-MANAGED GROWTH, MULTI-MANAGED MODERATE GROWTH,
MULTI-MANAGED INCOME/EQUITY and MULTI-MANAGED INCOME PORTFOLIOS (referred to
hereinafter as the "Multi-Managed Seasons Portfolios") allocates all of its
assets among three or four distinct MANAGED COMPONENTS, each managed by a
separate Manager and each with its own investment strategy. The three Managers
of the Multi-Managed Seasons Portfolios are SunAmerica Asset Management Corp.
("SunAmerica"), Janus Capital Corporation ("Janus") and Wellington Management
Company, LLP ("WMC"). None of the Multi-Managed Seasons Portfolios contains a
passively managed component. The four current Managed Components are
SUNAMERICA/AGGRESSIVE GROWTH, JANUS/GROWTH, SUNAMERICA/BALANCED and WMC/FIXED
INCOME. The Managed Components each invests to varying degrees, according to its
investment strategy, in a diverse portfolio of securities including, common
stocks, securities with equity characteristics (such as preferred stocks,
warrants or fixed income securities convertible into common stock), corporate
and U.S. government fixed income securities, money market instruments and/or
cash or cash equivalents. The assets of each Managed Component that comprises a
particular Multi-Managed Seasons Portfolio belong to that Portfolio. The term
"Manager" as used herein shall mean either SunAmerica, the Investment Adviser to
the Trust, or the other registered investment advisers that serve as Subadvisers
to the Trust, as the case may be.
Although each Multi-Managed Seasons Portfolio has a distinct investment
objective and allocates its assets in varying percentages among the Managed
Components in furtherance of that objective, each Manager intends to manage its
respective Managed Component(s) in the same general manner regardless of the
objective of the Multi-Managed Seasons Portfolios. However, the equity/ debt
weightings of the SUNAMERICA/BALANCED component under normal market conditions
will vary depending on the objective of the Multi-Managed Seasons Portfolios.
The following chart shows the allocation of the assets of each Multi-Managed
Seasons Portfolio among the Managed Components.
<TABLE>
<CAPTION>
<S> <C> <C> <C> <C>
SUNAMERICA/
AGGRESSIVE JANUS/ SUNAMERICA/ WMC/FIXED
GROWTH GROWTH BALANCED INCOME
PORTFOLIO COMPONENT COMPONENT COMPONENT COMPONENT
MULTI-MANAGED GROWTH 20% 40% 20% 20%
PORTFOLIO
MULTI-MANAGED MODERATE GROWTH 18% 28% 18% 36%
PORTFOLIO
MULTI-MANAGED INCOME/EQUITY 0% 18% 28% 54%
PORTFOLIO
MULTI-MANAGED INCOME 0% 8% 17% 75%
PORTFOLIO
</TABLE>
Differences in investment returns among the Managed Components may cause the
actual percentages to vary over the course of a calendar quarter from the
targets listed in the chart. Accordingly, the assets of each Multi-Managed
Seasons Portfolio will be reallocated or "rebalanced" among the Managed
Components on at least a quarterly basis to restore the target allocations for
such Portfolio.
4
<PAGE>
Q: WHAT ARE THE PRINCIPAL RISKS OF INVESTING IN THE PORTFOLIOS?
A: The following section describes the principal risks of each Portfolio, and
the charts beginning on page 11 describe various additional risks.
RISKS OF INVESTING IN EQUITY SECURITIES
The MULTI-MANAGED GROWTH, MULTI-MANAGED MODERATE GROWTH, ASSET ALLOCATION:
DIVERSIFIED GROWTH and STOCK PORTFOLIOS invest primarily in equity
securities. In addition, the MULTI-MANAGED INCOME/EQUITY and MULTI-MANAGED
INCOME PORTFOLIOS invest significantly in equity securities. As with any
equity fund, the value of your investment in any of these Portfolios may
fluctuate in response to stock market movements. Growth stocks are
historically volatile, which will particularly affect the MULTI-MANAGED
GROWTH, MULTI-MANAGED MODERATE GROWTH, ASSET ALLOCATION: DIVERSIFIED GROWTH
and STOCK PORTFOLIOS. You should be aware that the performance of different
types of equity stocks may rise or decline under varying market conditions
-- for example, "value" stocks may perform well, under circumstances in
which, "growth" stocks in general have fallen, and vice versa. In addition,
individual stocks selected for any of these Portfolios may underperform the
market generally.
RISKS OF INVESTING IN BONDS
The MULTI-MANAGED INCOME/EQUITY and MULTI-MANAGED INCOME PORTFOLIOS invest
primarily in bonds. In addition, the MULTI-MANAGED GROWTH, MULTI-MANAGED
MODERATE GROWTH and ASSET ALLOCATION: DIVERSIFIED GROWTH PORTFOLIOS each
invests significantly in bonds. As a result, as with any bond fund, the
value of your investment in these Portfolios may go up or down in response
to changes in interest rates or defaults (or even the potential for future
default) by bond issuers. To the extent a Portfolio is invested in bonds,
movements in the bond market generally may affect its performance. In
addition, individual bonds selected for any of these Portfolios may
underperform the market generally.
RISKS OF INVESTING IN JUNK BONDS
Each of the Portfolios except the STOCK PORTFOLIO may invest in varying
degrees in high yield/ high risk securities, also known as "junk bonds,"
which are considered speculative. While the Managers try to diversify a
Portfolio and try to engage in a credit analysis of each junk bond issuer in
which a Portfolio invests, junk bonds carry a substantial risk of default or
changes in the issuer's creditworthiness, or they may already be in default.
A junk bond's market price may fluctuate more than higher-quality securities
and may decline significantly. In addition, it may be more difficult for a
Portfolio to dispose of junk bonds or to determine their value. Junk bonds
may contain redemption or call provisions that, if exercised during a period
of declining interest rates, may force a Portfolio to replace the security
with a lower yielding security. If this occurs, it will result in a
decreased return for you.
RISKS OF INVESTING INTERNATIONALLY
All Portfolios may invest in foreign securities. These securities may be
denominated in currencies other than U.S. dollars. Foreign investing
presents special risks, particularly in certain emerging market countries.
While investing internationally may reduce your risk by increasing the
diversification of your investment, the value of your investment may be
affected by fluctuating currency values, changing local and regional
economic, political and social conditions, and greater market volatility. In
addition, foreign securities may not be as liquid as domestic securities.
5
<PAGE>
RISKS OF INVESTING IN SMALLER COMPANIES
All Portfolios may invest in smaller companies. Stocks of smaller companies
may be more volatile than, and not as liquid as, those of larger companies.
This will particularly affect the MULTI-MANAGED GROWTH, MULTI-MANAGED
MODERATE GROWTH and ASSET ALLOCATION: DIVERSIFIED GROWTH PORTFOLIOS.
RISKS OF INVESTING IN "NON-DIVERSIFIED" PORTFOLIOS
Each MULTI-MANAGED SEASONS PORTFOLIO is "non-diversified," which means that
each can invest a larger portion of its assets in the stock of a single
company than can some other mutual funds. By concentrating in a smaller
number of stocks, a Portfolio's risk is increased because the effect of each
stock on the Portfolio's performance is greater.
ADDITIONAL PRINCIPAL RISKS
Finally, shares of Portfolios are not bank deposits and are not guaranteed
or insured by any bank, government entity or the Federal Deposit Insurance
Corporation. As with any mutual fund, there is no guarantee that a Portfolio
will be able to achieve its investment goals. If the value of the assets of
a Portfolio goes down, you could lose money.
Q: HOW HAVE THE SEASONS PORTFOLIOS PERFORMED HISTORICALLY?
A: The following Risk/Return Bar Charts and Tables provide some indication of
the risks of investing in the Portfolios by showing changes in the
Portfolios' performance from calendar year to calendar year, and by comparing
each Portfolios' average annual returns with those of an appropriate market
index. Fees and expenses incurred at the contract level are not reflected in
the bar chart. If these amounts were reflected, returns would be less than
those shown. Of course, past performance is not necessarily an indication of
how a Portfolio will perform in the future.
6
<PAGE>
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MULTI-MANAGED GROWTH PORTFOLIO
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EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1998 31.45%
1999 55.76%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
31.19% (quarter ended 12/31/99) and the lowest return for a quarter was -6.23%
(quarter ended 9/30/98). For the most recent calendar quarter ended 3/31/00 the
return was 8.98%.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS PAST RETURN SINCE
(AS OF THE CALENDAR YEAR ENDED DECEMBER 31, 1999) ONE YEAR INCEPTION****
<S> <C> <C>
----------------------------------------------------------------------------------------
Multi-Managed Growth Portfolio 55.76% 39.02%
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S&P 500-Registered Trademark-* 21.04% 102.56%
----------------------------------------------------------------------------------------
Lehman Brothers Aggregate Index** -0.82% 18.36%
----------------------------------------------------------------------------------------
Blended Benchmark Index*** 14.77% 65.84%
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</TABLE>
* The Standard & Poor's 500-Registered Trademark- Composite Stock Price Index
(S&P 500-Registered Trademark-) is an unmanaged, weighted index of 500
large company stocks that is widely recognized as representative of the
performance of the U.S. stock market.
** The Lehman Brothers Aggregate Index provides a broad view of the
performance of the U.S. fixed income market.
*** The Blended Benchmark Index consists of 51% Standard & Poor's Composite
Index of 500 Stocks (S&P 500 Index), 27% Lehman Brothers Aggregate Index,
20% Russell 2000 Index, and 2% Treasury Bills. The S&P 500 Index tracks the
performance of 500 stocks representing a sampling of the largest foreign
and domestic stocks traded publicly in the United States. The Lehman
Brothers Aggregate Index provides a broad view of the performance of the
U.S. fixed income market. The Russell 2000 Index comprises the smallest
2000 companies in the Russell 3000 Index and is widely recognized as
representative of small-cap growth stocks. Treasury Bills are short-term
securities with maturities of one year or less issued by the U.S.
government.
**** Inception date for the Portfolio is April 15, 1997.
--------------------------------------------------------------------------------
MULTI-MANAGED MODERATE GROWTH PORTFOLIO
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1998 25.07%
1999 41.32%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
24.57% (quarter ended 12/31/99) and the lowest return for a quarter was -4.20%
(quarter ended 9/30/98). For the most recent calendar quarter ended 3/31/00 the
return was 7.58%.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS PAST RETURN SINCE
(AS OF THE CALENDAR YEAR ENDED DECEMBER 31, 1999) ONE YEAR INCEPTION****
<S> <C> <C>
----------------------------------------------------------------------------------------
Multi-Managed Moderate Growth Portfolio 41.32% 30.90%
----------------------------------------------------------------------------------------
S&P 500-Registered Trademark-* 21.04% 102.56%
----------------------------------------------------------------------------------------
Lehman Brothers Aggregate Index** -0.82% 18.36%
----------------------------------------------------------------------------------------
Blended Benchmark Index*** 11.38% 54.01%
----------------------------------------------------------------------------------------
</TABLE>
* The Standard & Poor's 500-Registered Trademark- Composite Stock Price Index
(S&P 500-Registered Trademark-) is an unmanaged, weighted index of 500
large company stocks that is widely recognized as representative of the
performance of the U.S. stock market.
** The Lehman Brothers Aggregate Index provides a broad view of the
performance of the U.S. fixed income market.
*** The Blended Benchmark Index consists of 37.9% Standard & Poor's Composite
Index of 500 Stocks (S&P 500 Index), 42.3% Lehman Brothers Aggregate Index,
18.0% Russell 2000 Index, and 1.8% Treasury Bills. The S&P 500 Index tracks
the performance of 500 stocks representing a sampling of the largest
foreign and domestic stocks traded publicly in the United States. The
Lehman Brothers Aggregate Index provides a broad view of the performance of
the U.S. fixed income market. The Russell 2000 Index comprises the smallest
2000 companies in the Russell 3000 Index and is widely recognized as
representative of small-cap growth stocks. Treasury Bills are short-term
securities with maturities of one year or less issued by the U.S.
government.
**** Inception date for the Portfolio is April 15, 1997.
7
<PAGE>
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MULTI-MANAGED INCOME/EQUITY PORTFOLIO
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1998 19.13%
1999 17.31%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
10.80% (quarter ended 12/31/99) and the lowest return for a quarter was 0.30%
(quarter ended 9/30/99). For the most recent calendar quarter ended 3/31/00 the
return was 5.54%.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS PAST RETURN SINCE
(AS OF THE CALENDAR YEAR ENDED DECEMBER 31, 1999) ONE YEAR INCEPTION****
<S> <C> <C>
----------------------------------------------------------------------------------------
Multi-Managed Income/Equity Portfolio 17.31% 18.76%
----------------------------------------------------------------------------------------
S&P 500-Registered Trademark-* 21.04% 102.56%
----------------------------------------------------------------------------------------
Lehman Brothers Aggregate Index** -0.82% 18.36%
----------------------------------------------------------------------------------------
Blended Benchmark Index*** 6.37% 42.85%
----------------------------------------------------------------------------------------
</TABLE>
* The Standard & Poor's 500-Registered Trademark- Composite Stock Price Index
(S&P 500-Registered Trademark-) is an unmanaged, weighted index of 500
large company stocks that is widely recognized as representative of the
performance of the U.S. stock market.
** The Lehman Brothers Aggregate Index provides a broad view of the
performance of the U.S. fixed income market.
*** The Blended Benchmark Index consists of 33.4% Standard & Poor's Composite
Index of 500 Stocks (S&P 500 Index), 63.8% Lehman Brothers Aggregate Index,
and 2.8% Treasury Bills. The S&P 500 Index tracks the performance of 500
stocks representing a sampling of the largest foreign and domestic stocks
traded publicly in the United States. The Lehman Brothers Aggregate Index
provides a broad view of the performance of the U.S. fixed income market.
Treasury Bills are short-term securities with maturities of one year or
less issued by the U.S. government.
**** Inception date for the Portfolio is April 15, 1997.
--------------------------------------------------------------------------------
MULTI-MANAGED INCOME PORTFOLIO
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1998 13.58%
1999 6.99%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
5.31% (quarter ended 12/31/99) and the lowest return for a quarter was -0.17%
(quarter ended 6/30/99). For the most recent calendar quarter ended 3/31/00 the
return was 3.83%.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS PAST RETURN SINCE
(AS OF THE CALENDAR YEAR ENDED DECEMBER 31, 1999) ONE YEAR INCEPTION****
<S> <C> <C>
----------------------------------------------------------------------------------------
Multi-Managed Income Portfolio 6.99% 12.16%
----------------------------------------------------------------------------------------
S&P 500-Registered Trademark-* 21.04% 102.56%
----------------------------------------------------------------------------------------
Lehman Brothers Aggregate Index** -0.82% 18.36%
----------------------------------------------------------------------------------------
Blended Benchmark Index*** 2.90% 30.65%
----------------------------------------------------------------------------------------
</TABLE>
* The Standard & Poor's 500-Registered Trademark- Composite Stock Price Index
(S&P 500-Registered Trademark-) is an unmanaged, weighted index of 500
large company stocks that is widely recognized as representative of the
performance of the U.S. stock market.
** The Lehman Brothers Aggregate Index provides a broad view of the
performance of the U.S. fixed income market.
*** The Blended Benchmark Index consists of 17.35% Standard & Poor's Composite
Index of 500 Stocks (S&P 500 Index), 80.95% Lehman Brothers Aggregate
Index, and 1.70% Treasury Bills. The S&P 500 Index tracks the performance
of 500 stocks representing a sampling of the largest foreign and domestic
stocks traded publicly in the United States. The Lehman Brothers Aggregate
Index provides a broad view of the performance of the U.S. fixed income
market. Treasury Bills are short-term securities with maturities of one
year or less issued by the U.S. government.
**** Inception date for the Portfolio is April 15, 1997.
8
<PAGE>
--------------------------------------------------------------------------------
ASSET ALLOCATION: DIVERSIFIED GROWTH PORTFOLIO
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1998 13.43%
1999 18.79%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
15.54% (quarter ended 12/31/98) and the lowest return for a quarter was -9.81%
(quarter ended 9/30/98). For the most recent calendar quarter ended 3/31/00 the
return was 2.12%.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS PAST RETURN SINCE
(AS OF THE CALENDAR YEAR ENDED DECEMBER 31, 1999) ONE YEAR INCEPTION****
<S> <C> <C>
Asset Allocation: Diversified Growth Portfolio 18.79% 16.52%
----------------------------------------------------------------------------------------
S&P 500-Registered Trademark-* 21.04% 102.56%
----------------------------------------------------------------------------------------
Lehman Brothers Aggregate Index** -0.82% 18.36%
----------------------------------------------------------------------------------------
Blended Benchmark Index*** 17.72% 75.95%
----------------------------------------------------------------------------------------
</TABLE>
* The Standard & Poor's 500-Registered Trademark- Composite Stock Price Index
(S&P 500-Registered Trademark-) is an unmanaged, weighted index of 500
large company stocks that is widely recognized as representative of the
performance of the U.S. stock market.
** The Lehman Brothers Aggregate Index provides a broad view of the
performance of the U.S. fixed income market.
*** The Blended Benchmark Index consists of 60% Standard & Poor's Composite
Index of 500 Stocks (S&P 500 Index), 20% Lehman Brothers Aggregate Index,
and 20% Morgan Stanley Capital International Europe, Australia and Far East
(MSCI EAFE) Index. The S&P 500 Index tracks the preformance of 500 stocks
representing a sampling of the largest foreign and domestic stocks traded
publicly in the United States. The Lehman Brothers Aggregate Index provides
a broad view of the performance of the U.S. fixed income market. The MSCI
EAFE Index represents the foreign stocks of 19 countries in Europe,
Australia and the Far East.
**** Inception date for the Portfolio is April 15, 1997.
--------------------------------------------------------------------------------
STOCK PORTFOLIO
--------------------------------------------------------------------------------
EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC
<TABLE>
<S> <C>
1998 27.24%
1999 21.51%
</TABLE>
During the period shown in the bar chart, the highest return for a quarter was
22.80% (quarter ended 12/31/98) and the lowest return for a quarter was -11.25%
(quarter ended 9/30/98). For the most recent calendar quarter ended 3/31/00 the
return was 8.17%.
<TABLE>
<CAPTION>
AVERAGE ANNUAL TOTAL RETURNS PAST RETURN SINCE
(AS OF THE CALENDAR YEAR ENDED DECEMBER 31, 1999) ONE YEAR INCEPTION**
<S> <C> <C>
---------------------------------------------------------------------------------------
Stock Portfolio 21.51% 28.93%
---------------------------------------------------------------------------------------
S&P 500-Registered Trademark-* 21.04% 102.56%
---------------------------------------------------------------------------------------
</TABLE>
* The Standard & Poor's Composite Index of 500 Stocks (S&P 500 Index) tracks
the performance of 500 stocks representing a sampling of the largest foreign
and domestic stocks traded publicly in the United States.
** Inception date for the Portfolio is April 15, 1997.
9
<PAGE>
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MORE INFORMATION ABOUT THE PORTFOLIOS
-------------------------------------------------------------------------------
INVESTMENT STRATEGIES
Each Portfolio has its own investment goal and principal strategy for pursuing
it as described in the charts beginning on page 3. The charts below summarize
information about each Portfolio's and Managed Component's investments. We have
included a glossary to define the investment and risk terminology used in the
charts and throughout this Prospectus. Unless otherwise indicated, investment
restrictions, including percentage limitations, apply at the time of purchase.
You should consider your ability to assume the risks involved before investing
in a Portfolio or Managed Component through the Seasons Variable Annuity
Contract.
You should be aware that if you purchase a Seasons Variable Annuity Contract you
will not invest directly in one of the Portfolios. Instead, the Seasons Variable
Annuity Contract offers four variable investment "Strategies," each of which
invests in three of the six Seasons Portfolios and the allocation of assets
among the Portfolios will vary depending on the objective of the Strategy.
ADDITIONAL INFORMATION ABOUT THE SEASONS PORTFOLIOS
Four of the Seasons Portfolios are Multi-Managed Seasons Portfolios, which means
that they pursue their investment goals by allocating their assets among three
or four Managed Components, as previously indicated in the chart on page 4. If
you invest in one of the Multi-Managed Seasons Portfolios, it's important for
you to understand how the information in the charts provided below applies
specifically to your investment. To summarize the allocation strategy, because
the MULTI-MANAGED GROWTH and MULTI-MANAGED MODERATE GROWTH PORTFOLIOS seek
long-term growth of capital, each therefore allocates a relatively larger
percentage of its assets to the SUNAMERICA/AGGRESSIVE GROWTH and JANUS/GROWTH
components than do the other two Multi-Managed Seasons Portfolios. In contrast,
the MULTI-MANAGED INCOME/EQUITY and MULTI-MANAGED INCOME PORTFOLIOS focus on
preservation of principal or capital and therefore allocate a relatively larger
percentage of their assets to the SUNAMERICA/BALANCED and WMC/FIXED INCOME
components. The MULTI-MANAGED INCOME/EQUITY and the MULTI-MANAGED INCOME
PORTFOLIOS do not allocate any percentage of their assets to the
SUNAMERICA/AGGRESSIVE GROWTH component.
You should carefully review the investment objectives and policies of each
Multi-Managed Seasons Portfolios to understand how each Managed Component
applies to an investment in any of the Multi-Managed Season Portfolios. For
example, if you invest in a Strategy that invests heavily in the MULTI-MANAGED
INCOME PORTFOLIO, you should be aware that this Portfolio distributes its assets
among the JANUS/GROWTH component, the SUNAMERICA/BALANCED component and the
WMC/FIXED INCOME component in a ratio of 8%/17%/75%. Also, if you invest in a
Strategy that invests heavily in the MULTI-MANAGED INCOME PORTFOLIO you should
be aware that this Portfolio invests three quarters of its assets in the
WMC/FIXED INCOME component. So, when reviewing the charts provided below, please
keep in mind how the investment strategies and risks of each of the Managed
Components applies to your investment.
10
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
SEASONS PORTFOLIOS
SUNAMERICA/ SUNAMERICA/
AGGRESSIVE GROWTH JANUS/GROWTH BALANCED
COMPONENT COMPONENT COMPONENT
What are the - Equity securities, - Equity securities - Equity securities:
Portfolio's/Managed including those of selected for their -large-cap stocks
Component's principal lesser known or new growth potential: -mid-cap stocks
investments? growth companies or -large-cap stocks - Long term bonds and
industries, such as -mid-cap stocks other debt securities
technology, -small-cap stocks - 70%/30% neutral
telecommunications, equity/debt weighting
media for Multi-Managed
and healthcare: Growth and Moderate
-mid-cap stocks Growth Portfolios
-small-cap stocks (actual weighting may
differ)
- 50%/50% neutral
equity/debt weighting
for Multi-Managed
Income/Equity and
Income Portfolios
(actual weighting may
differ)
In what other types - Large-cap stocks - Junk bonds (up to - Small-cap stocks (up
of investments may - Short-term 35%) to 20%)
the Portfolio/ investments - Short-term - Short-term
Managed Component (up to 25%) investments investments
significantly invest? - Illiquid securities (up to 25%) (up to 25%)
(up to 15%) - Illiquid securities - Foreign securities
- Securities lending (up to 15%) (up to 25%)
(up to 33 1/3%) - Securities lending - ADRs/EDRs/GDRs
- Options (up to 33 1/3%) - Emerging markets
- PFICs
- Illiquid securities
(up to 15%)
- Securities lending
(up to 33 1/3%)
What other types of - Investment grade - Investment grade - Investment grade
investments may the fixed income fixed fixed income
Portfolio/Managed securities income securities securities
Component use as part - U.S. government - U.S. government - U.S. government
of efficient securities securities securities
portfolio management - Asset-backed and - Asset-backed and - Asset-backed and
or to enhance return? mortgage- backed mortgage- backed mortgage- backed
securities securities securities
- Foreign securities - Foreign securities - Options and futures
- ADRs/EDRs/GDRs - ADRs/EDRs/GDRs - Special situations
- PFICs - Currency transactions (up to 25%)
- Options and futures - Currency baskets - Currency transactions
- Special situations - Emerging markets - Currency baskets
(up to 25%) - PFICs
- Options and futures
- Special situations
(up to 25%)
What risks normally - Market volatility - Market volatility - Market volatility
affect the Portfolio/ - Securities selection - Securities selection - Securities selection
Managed Component? - Growth stocks - Growth stocks - Interest rate
- Small and medium - Junk bonds fluctuations
sized companies - Small and medium - Small and medium
- Non-diversified sized companies sized companies
status - Non-diversified - Non-diversified
- Foreign exposure status status
- Emerging markets - Foreign exposure - Foreign exposure
- Illiquidity - Emerging markets - Emerging markets
- Prepayment - Credit quality - Illiquidity
- Derivatives - Illiquidity - Prepayment
- Hedging - Prepayment - Derivatives
- Active trading - Derivatives - Hedging
- Hedging
- Active trading
</TABLE>
11
<PAGE>
<TABLE>
<CAPTION>
<S> <C> <C> <C>
SEASONS PORTFOLIOS
WMC/FIXED ASSET ALLOCATION:
INCOME DIVERSIFIED
COMPONENT GROWTH PORTFOLIO STOCK PORTFOLIO
What are the - U.S. and foreign - Strategic allocation - Common stocks of well
Portfolio's/Managed fixed income of approximately 80% established growth
Component's principal securities of varying (with a range of companies (at least
investments? maturities and 65-95%) of assets to 65% of total assets)
risk/return equity securities:
characteristics (at -large-cap stocks
least 80% investment -mid-cap stocks
grade securities and -small-cap stocks
at least 85% U.S. - Strategic allocation
dollar denominated of approximately 20%
securities) (with a range of
5-35%) of assets to
fixed income
securities
In what other types - Junk bonds (up to - Junk bonds (up to - Short-term
of investments may 20%) 20%) investments
the Portfolio/ - Short-term - Short-term (up to 25%)
Managed Component investments investments - Foreign securities
significantly invest? (up to 25%) (up to 25%) (up to 30%)
- Foreign securities - Foreign securities - Illiquid securities
(up to 15% denominated (up to 60%) (up to 15%)
in foreign currencies; - Illiquid securities - Securities lending
up to 100% denominated (up to 15%) (up to 33 1/3%)
in U.S. dollars) - Securities lending
- Illiquid securities (up to 33 1/3%)
(up to 15%)
- Securities lending
(up to 33 1/3%)
What other types of - Investment grade - Investment grade - Mid-cap stocks
investments may the fixed income fixed - Investment grade
Portfolio/Managed securities income securities fixed income
Component use as part - U.S. government - U.S. government securities
of efficient securities securities - U.S. government
portfolio management - Asset-backed and - Asset-backed and securities
or to enhance return? mortgage- backed mortgage- backed - Asset-backed and
securities securities mortgage- backed
- Currency transactions - ADRs/EDRs/GDRs securities
- Currency baskets - Currency transactions - ADRs/EDRs/ GDRs
- PFICs - Currency baskets - Currency transactions
- Options and futures - Emerging markets - Currency baskets
- Special situations - PFICs - Emerging markets
(up to 25%) - Options and futures - PFICs
- Special situations - Options and futures
(up to 25%) - Special situations
(up to 25%)
- Convertible
securities and
warrants
What risks normally - Market volatility - Market volatility - Market volatility
affect the Portfolio/ - Securities selection - Securities selection - Securities selection
Managed Component? - Interest rate - Growth stocks - Growth stocks
fluctuations - Foreign exposure - Foreign exposure
- Non-diversified - Small and medium - Medium-sized
status sized companies companies
- Foreign exposure - Emerging markets - Emerging markets
- Emerging markets - Credit quality - Illiquidity
- Credit quality - Junk bonds - Prepayment
- Junk bonds - Illiquidity - Derivatives
- Illiquidity - Prepayment - Hedging
- Prepayment - Derivatives
- Derivatives - Hedging
- Hedging
- Active trading
</TABLE>
12
<PAGE>
--------------------------------------------------------------------------------
GLOSSARY
--------------------------------------------------------------------------------
INVESTMENT TERMINOLOGY
CURRENCY TRANSACTIONS include the purchase and sale of currencies to facilitate
the settlement of securities transactions and forward currency contracts, which
are used to hedge against changes in currency exchange rates.
A CURRENCY BASKET consists of specified amounts of currencies of certain foreign
countries.
EQUITY SECURITIES, such as COMMON STOCKS, represent shares of equity ownership
in a corporation. Common stocks may or may not receive dividend payments.
Certain securities have common stock characteristics, including certain
convertible securities such as WARRANTS and RIGHTS, and may be classified as
equity securities. Investments in equity securities and securities with equity
characteristics include:
- LARGE-CAP STOCKS are common stocks of large companies that generally have
market capitalizations of over $9.5 billion, although there may be some
overlap among capitalization categories. WMC will consider stock of
companies with market capitalizations equaling or exceeding the median
market capitalization of the S&P 500-Registered Trademark- to be
large-cap stocks. Market capitalization categories may change based on
market conditions or changes in market capitalization classifications as
defined by agencies such as S&P, Russell, Morningstar, Inc. or Lipper.
- MID-CAP STOCKS are common stocks of medium sized companies that generally
have market capitalizations ranging from $1.5 billion to $9.5 billion,
although there may be some overlap among capitalization categories.
Market capitalization categories may change based on market conditions or
changes in market capitalization classifications as defined by agencies
such as S&P, Russell, Morningstar, Inc. or Lipper.
- SMALL-CAP STOCKS are common stocks of small companies that generally have
market capitalizations of $1.5 billion or less, although there may be
some overlap among capitalization categories. Market capitalization
categories may change based on market conditions or changes in market
capitalization classifications as defined by agencies such as S&P,
Russell, Morningstar, Inc. or Lipper.
- CONVERTIBLE SECURITIES are securities (such as bonds or preferred stocks)
that may be converted into common stock of the same or a different
company.
- WARRANTS are rights to buy common stock of a company at a specified price
during the life of the warrant.
- RIGHTS represent a preemptive right of stockholders to purchase
additional shares of a stock at the time of a new issuance before the
stock is offered to the general public.
FIXED INCOME SECURITIES are broadly classified as securities that provide for
periodic payment, typically interest or dividend payments, to the holder of the
security at a stated rate. Most fixed income securities, such as bonds,
represent indebtedness of the issuer and provide for repayment of principal at a
stated time in the future. Others do not provide for repayment of a principal
amount. The issuer of a SENIOR FIXED INCOME SECURITY is obligated to make
payments on this security ahead of other payments to security holders.
Investments in fixed income securities include:
- U.S. GOVERNMENT SECURITIES are issued or guaranteed by the U.S.
government, its agencies and instrumentalities. Some U.S. government
securities are issued or unconditionally guaranteed by the U.S. Treasury.
They are of the highest possible credit quality. While these securities
are subject to variations in market value due to fluctuations in interest
rates, they will be paid in full if held to maturity. Other U.S.
government securities are neither direct obligations of, nor guaranteed
by, the U.S. Treasury. However, they involve federal sponsorship in one
way or another. For example, some are backed by specific types of
collateral; some are supported by the issuer's right to borrow from the
Treasury; some are supported by the discretionary
13
<PAGE>
authority of the Treasury to purchase certain obligations of the issuer;
and others are supported only by the credit of the issuing government
agency or instrumentality.
- An INVESTMENT GRADE FIXED INCOME SECURITY is rated in one of the top four
rating categories by a debt rating agency (or is considered of comparable
quality by the Adviser or Subadviser). The two best-known debt rating
agencies are Standard & Poor's Rating Services, a Division of the
McGraw-Hill Companies, Inc. and Moody's Investors Service, Inc.
INVESTMENT GRADE refers to any security rated "BBB" or above by Standard
& Poor's or "Baa" or above by Moody's or determined by the Manager to be
of comparable quality.
- A JUNK BOND is a high yield, high risk bond that does not meet the credit
quality standards of an investment grade security.
- PASS-THROUGH SECURITIES involve various debt obligations that are backed
by a pool of mortgages or other assets. Principal and interest payments
made on the underlying asset pools are typically passed through to
investors. Types of pass-through securities include MORTGAGE-BACKED
SECURITIES, COLLATERALIZED MORTGAGE OBLIGATIONS, COMMERCIAL
MORTGAGE-BACKED SECURITIES, and ASSET-BACKED SECURITIES.
- PREFERRED STOCKS receive dividends at a specified rate and have
preference over common stock in the payment of dividends and the
liquidation of assets.
FOREIGN SECURITIES are issued by companies located outside of the United States,
including emerging markets. Foreign securities may include foreign corporate and
government bonds, foreign equity securities, foreign investment companies,
passive foreign investment companies (PFICS), American Depositary Receipts
(ADRS) or other similar securities that represent interests in foreign equity
securities, such as European Depositary Receipts (EDRS) and Global Depositary
Receipts (GDRS). An EMERGING MARKET country is generally one with a low or
middle income or economy or that is in the early stages of its industrialization
cycle. For fixed income investments, an emerging market includes those where the
sovereign credit rating is below investment grade. Emerging market countries may
change over time depending on market and economic conditions and the list of
emerging market countries may vary by Adviser or Subadviser.
ILLIQUID/RESTRICTED SECURITIES are subject to legal or contractual restrictions
that may make them difficult to sell. A security that cannot easily be sold
within seven days will generally be considered illiquid. Certain restricted
securities (such as Rule 144A securities) are not generally considered illiquid
because of their established trading market.
OPTIONS AND FUTURES are contracts involving the right to receive or the
obligation to deliver assets or money depending on the performance of one or
more underlying assets or a market or economic index. An option gives its owner
the right, but not the obligation, to buy ("call") or sell ("put") a specified
amount of a security at a specified price within in a specified time period. A
futures contract is an exchange-traded legal contract to buy or sell a standard
quantity and quality of a commodity, financial instrument, index, ETC. at a
specified future date and price.
SECURITIES LENDING involves a loan of securities by a Portfolio in exchange for
cash or collateral. A Portfolio earns interest on the loan while retaining
ownership of the security.
SHORT-TERM INVESTMENTS include money market securities such as short-term U.S.
government obligations, repurchase agreements, commercial paper, bankers'
acceptances and certificates of deposit. These securities provide a Portfolio
with sufficient liquidity to meet redemptions and cover expenses.
A SPECIAL SITUATION arises when, in the opinion of the Manager, the securities
of a particular issuer will be recognized and appreciate in value due to a
specific development with respect to that issuer. Developments creating a
special situation might include, among others, a new product or process, a
technological breakthrough, a management change or other extraordinary corporate
event, or differences in market supply of and demand for the security.
Investment in special situations may carry an additional risk of loss in the
event that the anticipated development does not occur or does not attract the
expected attention.
14
<PAGE>
RISK TERMINOLOGY
ACTIVE TRADING: A strategy used whereby the Portfolio may engage in frequent
trading of portfolio securities to achieve its investment goal. Active trading
may result in high portfolio turnover and correspondingly greater brokerage
commissions and other transaction costs, which will be borne directly by a
Portfolio. In addition, because a Portfolio may sell a security without regard
to how long it has held the security, active trading may have tax consequences
for certain shareholders, involving a possible increase in short-term capital
gains or losses. During periods of increased market volatility, active trading
may be more pronounced. In the "Financial Highlights" section we provide each
Portfolio's portfolio turnover rate for each fiscal year since inception.
CREDIT QUALITY: The creditworthiness of the issuer is always a factor in
analyzing fixed income securities. 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. This type of issuer will typically issue JUNK
BONDS. In addition to the risk of default, junk bonds may be more volatile, less
liquid, more difficult to value and more susceptible to adverse economic
conditions or investor perceptions than other bonds.
DERIVATIVES: A derivative is any financial instrument whose value is based on,
and determined by, another security, index or benchmark (E.G., stock options,
futures, caps, floors, etc.). In recent years, derivative securities have become
increasingly important in the field of finance. Futures and options are now
actively traded on many different exchanges. Forward contracts, swaps, and many
different types of options are regularly traded outside of exchanges by
financial institutions in what are termed "over the counter" markets. Other more
specialized derivative securities often form part of a bond or stock issue. To
the extent a contract is used to hedge another position in the portfolio, the
Portfolio will be exposed the risks associated with hedging as describe in this
glossary. To the extent an option or futures contract is used to enhance return,
rather than as a hedge, a Portfolio will be directly exposed to the risks of the
contract. Gains or losses from non-hedging positions may be substantially
greater than the cost of the position.
FOREIGN EXPOSURE: Investors in foreign countries are subject to a number of
risks. A principal risk is that fluctuations in the exchange rates between the
U.S. dollar and foreign currencies may negatively affect an investment. In
addition, there may be less publicly available information about a foreign
company and it may not be subject to the same uniform accounting, auditing and
financial reporting standards as U.S. companies. Foreign governments may not
regulate securities markets and companies to the same degree as in the U.S.
Foreign investments will also be affected by local, political or economic
developments and governmental actions. Consequently, foreign securities may be
less liquid, more volatile and more difficult to price than U.S. securities.
These risks are heightened when an issuer is in an EMERGING MARKET.
Historically, the markets of EMERGING MARKET countries have been more volatile
than more developed markets; however, such markets can provide higher rates of
return to investors.
GROWTH STOCKS: Growth stocks can be volatile for several reasons. Since the
issuers usually reinvest a high portion of earnings in their own business,
growth stocks may lack the comfortable dividend yield associated with value
stocks that can cushion total return in a bear market. Also, growth stocks
normally carry a higher price/earnings ratio than many other stocks.
Consequently, if earnings expectations are not met, the market price of growth
stocks will often go down more than other stocks. However, the market frequently
rewards growth stocks with price increases when expectations are met or
exceeded.
HEDGING: Hedging is a strategy in which a Portfolio uses a derivative security
to reduce certain risk characteristics of an underlying security or portfolio of
securities. While hedging strategies can be very
15
<PAGE>
useful and inexpensive ways of reducing risk, they are sometimes ineffective due
to unexpected changes in the market. Hedging also involves the risk that changes
in the value of the derivative will not match those of the instruments being
hedged as expected, in which case any losses on the instruments being hedged may
not be reduced.
ILLIQUIDITY: There may not be a market for certain securities making it
difficult or impossible to sell at the time and the price that the seller would
like.
INTEREST RATE FLUCTUATIONS: The volatility of fixed income securities is due
principally to changes in interest rates. The market value of bonds and other
fixed income securities usually tends to vary inversely with the level of
interest rates. As interest rates rise the value of such securities typically
falls, and as interest rates fall, the value of such securities typically rise.
Longer-term and lower coupon bonds tend to be more sensitive to changes in
interest rates.
MARKET VOLATILITY: The stock and/or bond markets as a whole could go up or down
(sometimes dramatically). This could affect the value of the securities in a
Portfolio's portfolio.
NON-DIVERSIFIED STATUS: Portfolios registered as "non-diversified" investment
companies can invest a larger portion of their assets in the stock of a single
company than can diversified investment companies, and thus they can concentrate
in a smaller number of securities. A non-diversified investment company's risk
may increase because the effect of each security on the Portfolio's performance
is greater.
PREPAYMENT: Prepayment risk is the possibility that the principal of the loans
underlying mortgage-backed or other pass-through securities may be prepaid at
any time. As a general rule, prepayments increase during a period of falling
interest rates and decrease during a period of rising interest rates. As a
result of prepayments, in periods of declining interest rates a Portfolio may be
required to reinvest its assets in securities with lower interest rates. In
periods of increasing interest rates, prepayments generally may decline, with
the effect that the securities subject to prepayment risk held by a Portfolio
may exhibit price characteristics of longer-term debt securities.
SECURITIES SELECTION: A strategy used by a Portfolio, or securities selected by
its portfolio manager, may fail to produce the intended return.
SMALL AND MEDIUM SIZED COMPANIES: Companies with smaller market capitalizations
(particularly under $1.5 billion) tend to be at early stages of development with
limited product lines, market access for products, financial resources, access
to new capital, or depth in management. Consequently, the securities of smaller
companies may not be as readily marketable and may be subject to more abrupt or
erratic market movements. Securities of medium sized companies are also usually
more volatile and entail greater risks than securities of large companies.
16
<PAGE>
--------------------------------------------------------------------------------
MANAGEMENT
--------------------------------------------------------------------------------
INVESTMENT ADVISER AND MANAGER
SUNAMERICA ASSET MANAGEMENT CORP. SUNAMERICA serves as investment adviser and
manager for all the Portfolios of the Trust. SunAmerica selects the Subadvisers
for the Portfolios, serves as Manager for certain Portfolios or portions of
Portfolios, provides various administrative services and supervises the daily
business affairs of each Portfolio.
SunAmerica, located at The SunAmerica Center, 733 Third Avenue, New York, New
York 10017-3204, is a corporation organized in 1982 under the laws of the State
of Delaware. SunAmerica is engaged in providing investment advice and management
services to the Trust, other mutual funds and pension funds. In addition to
serving as adviser to the Trust, SunAmerica serves as adviser, manager and/or
administrator for Anchor Pathway Fund, Anchor Series Trust, Brazos Mutual Funds,
SunAmerica Strategic Investment Series, Inc., SunAmerica Style Select
Series, Inc., SunAmerica Equity Funds, SunAmerica Income Funds, SunAmerica Money
Market Funds, Inc. and SunAmerica Series Trust.
In addition to serving as the investment adviser and manager to the Trust and
each Portfolio and supervising activities of the other Subadvisers, SunAmerica
manages the SUNAMERICA/AGGRESSIVE GROWTH and SUNAMERICA/BALANCED components of
the Multi-Managed Seasons Portfolios.
For the fiscal year ended March 31, 2000 each Seasons Portfolio paid SunAmerica
a fee equal to the following percentage of average daily net assets:
<TABLE>
<CAPTION>
PORTFOLIO FEE
--------- ---
<S> <C>
Multi-Managed Growth Portfolio............................ 0.89%
Multi-Managed Moderate Growth Portfolio................... 0.85%
Multi-Managed Income/Equity Portfolio..................... 0.81%
Multi-Managed Income Portfolio............................ 0.77%
Asset Allocation: Diversified Growth Portfolio............ 0.85%
Stock Portfolio........................................... 0.85%
</TABLE>
SunAmerica compensates the Subadvisers out of the fees that it receives from the
Portfolios. SunAmerica may terminate any agreement with a Subadviser without
shareholder approval. Moreover, SunAmerica has received an exemptive order from
the Securities and Exchange Commission that permits SunAmerica, subject to
certain conditions, to enter into agreements relating to the Trust with
Subadvisers approved by the Board of Trustees without obtaining shareholder
approval. The exemptive order also permits SunAmerica, subject to the approval
of the Board but without shareholder approval, to employ new Subadvisers for new
or existing Portfolios, change the terms of particular agreements with
Subadvisers or continue the employment of existing Subadvisers after events that
would otherwise cause an automatic termination of a Subadviser agreement.
Shareholders of a Portfolio have the right
17
<PAGE>
to terminate an agreement with a Subadviser for that Portfolio at any time by a
vote of the majority of the outstanding voting securities of such Portfolio.
Shareholders will be notified of any Subadviser changes. The order also permits
the Trust to disclose to shareholders the Subadviser fees only in the aggregate
for each Portfolio. Each of the Subadvisers is independent of SunAmerica and
discharges its responsibilities subject to the policies of the Trustees and the
oversight and supervision of SunAmerica, which pays the Subadvisers fees. These
fees do not increase Portfolio expenses.
INFORMATION ABOUT THE SUBADVISERS
JANUS CAPITAL CORPORATION. JANUS is a Colorado corporation with principal
offices at 100 Fillmore Street, Denver, Colorado 80206-4923. Janus serves as
investment adviser to all of the Janus funds, as well as adviser or subadviser
to other mutual funds and individual, corporate, charitable and retirement
accounts.
PUTNAM INVESTMENT MANAGEMENT, INC. PUTNAM is a Massachusetts corporation with
principal offices at One Post Office Square, Boston, Massachusetts. Putnam has
been managing mutual funds since 1937 and serves as investment adviser to the
funds in the Putnam Family.
T. ROWE PRICE ASSOCIATES, INC. T. ROWE PRICE is a Maryland corporation with
principal offices at 100 East Pratt Street, Baltimore, Maryland 21202. T. Rowe
Price serves as investment adviser to the T. Rowe Price family of no-load mutual
funds and to individual and institutional clients.
WELLINGTON MANAGEMENT COMPANY, LLP. WMC is a Massachusetts limited liability
partnership. The principal offices of WMC are located at 75 State Street,
Boston, Massachusetts 02109. WMC is a professional investment counseling firm
which provides investment services to investment companies, employee benefit
plans, endowments, foundations, and other institutions.
18
<PAGE>
PORTFOLIO MANAGEMENT
The management of each Portfolio and Managed Component is summarized in the
following table.
<TABLE>
<S> <C>
SEASONS PORTFOLIOS
<S> <C>
PORTFOLIO MANAGEMENT ALLOCATED AMONG
PORTFOLIO THE FOLLOWING MANAGERS
--------------------------------------------------------------------------------------------
<S> <C>
Multi-Managed Growth Portfolio - Janus
(through Janus/Growth component)
- SunAmerica
(through SunAmerica/Aggressive Growth
component and SunAmerica/Balanced component)
- WMC
(through WMC/Fixed Income component)
--------------------------------------------------------------------------------------------
Multi-Managed Moderate Growth Portfolio - Janus
(through Janus/Growth component)
- SunAmerica
(through SunAmerica/Aggressive Growth
component and SunAmerica/Balanced component)
- WMC
(through WMC/Fixed Income component)
--------------------------------------------------------------------------------------------
Multi-Managed Income/Equity Portfolio - Janus
(through Janus/Growth component)
- SunAmerica
(through SunAmerica/Balanced component)
- WMC
(through WMC/Fixed Income component)
--------------------------------------------------------------------------------------------
Multi-Managed Income Portfolio - Janus
(through Janus/Growth component)
- SunAmerica
(through SunAmerica/Balanced component)
- WMC
(through WMC/Fixed Income component)
--------------------------------------------------------------------------------------------
Asset Allocation: Diversified Growth - Putnam
Portfolio
--------------------------------------------------------------------------------------------
Stock Portfolio - T. Rowe Price
--------------------------------------------------------------------------------------------
</TABLE>
19
<PAGE>
The primary investment manager(s) and/or the management team(s) for each
Portfolio and Managed Component is set forth in the following table.
<TABLE>
<S> <C> <C> <C>
NAME AND TITLE OF PORTFOLIO
PORTFOLIO OR MANAGED MANAGER(S) MANAGER(S) (AND/OR MANAGEMENT EXPERIENCE
COMPONENT TEAM(S))
---------------------------------------------------------------------------------------------------------
SunAmerica/ SunAmerica - Donna M. Calder Ms. Calder has been a
Aggressive Growth Vice President and Portfolio portfolio manager since
component Manager (Domestic Equity joining the firm in
(Multi-Managed Investment Team) March 1998. Prior to joining
Seasons Portfolios) SunAmerica, Ms. Calder was
the Founder and General
Partner of Manhattan Capital
Partners, L.P. (1991-1995)
---------------------------------------------------------------------------------------------------------
SunAmerica/ Balanced SunAmerica - Francis D. Gannon Mr. Gannon has been a
component Vice President and portfolio manager with the
(Multi-Managed Portfolio Manager firm since 1996. He joined
Seasons Portfolios) (Domestic Equity Investment Team) SunAmerica as an equity
analyst in 1993.
- Fixed Income Investment Team
---------------------------------------------------------------------------------------------------------
Janus/Growth Janus - Michael Dugas Mr. Dugas joined Janus in
component Senior Portfolio Manager 1993. He manages separate
(Multi-Managed accounts in the Diversified
Seasons Portfolios) Growth Discipline and serves
as an assistant portfolio
manager of Janus Mercury
Fund.
---------------------------------------------------------------------------------------------------------
WMC/Fixed Income WMC - Lucius T. Hill, III Mr. Hill has been a portfolio
component Senior Vice President and Partner manager with WMC since
(Multi-Managed joining the firm in 1993.
Seasons Portfolios)
---------------------------------------------------------------------------------------------------------
Asset Allocation: Putnam - Global Asset Allocation N/A
Diversified Growth Committee
Portfolio
---------------------------------------------------------------------------------------------------------
Stock Portfolio T. Rowe Price - Robert W. Smith Mr. Smith has been managing
Investment Advisory Committee investments with T. Rowe
Chairman, Managing Director, and Price since joining the firm
Equity Portfolio Manager in 1992.
---------------------------------------------------------------------------------------------------------
</TABLE>
CUSTODIAN, TRANSFER AND DIVIDEND PAYING AGENT
State Street Bank and Trust Company, Boston, Massachusetts, acts as Custodian of
the Trust's assets as well as Transfer and Dividend Paying Agent and in so doing
performs certain bookkeeping, data processing and administrative services.
20
<PAGE>
--------------------------------------------------------------------------------
ACCOUNT INFORMATION
--------------------------------------------------------------------------------
Shares of the Portfolios are not offered directly to the public. Instead, shares
of the Portfolios are currently offered only to Variable Annuity Account Five, a
separate account of Anchor National Life Insurance Company. So if you would like
to invest in a Portfolio, you must purchase a Seasons Variable Annuity Contract
from Anchor National.
You should be aware that if you purchase a Seasons Variable Annuity Contract you
will not invest directly in one of the Portfolios. Instead, the Seasons Variable
Annuity Contract offers four variable investment "Startegies," each of which
invests in three of the six Seasons Portfolios, managed collectively by five
different professional investment managers. The allocation of assets among the
Portfolios will vary depending on the objective of the Strategy.
You should also be aware that the Seasons Variable Annuity Contract involves
fees and expenses that are not described in this Prospectus, and that the
Contract also may involve certain restrictions and limitations. You will find
information about purchasing a Seasons Variable Annuity Contract in the
prospectus that offers the Contract, which accompanies this Prospectus.
TRANSACTION POLICIES
VALUATION OF SHARES. The net asset value per share (NAV) for each Portfolio is
determined each business day at the close of regular trading on the New York
Stock Exchange (generally 4:00 p.m., Eastern time) by dividing its net assets by
the number of its shares outstanding. Investments for which market quotations
are readily available are valued at market, except that short-term securities
with 60 days or less to maturity are valued on an amortized cost basis. All
other securities and assets are valued at "fair value" following procedures
approved by the Trustees.
BUY AND SELL PRICES. Variable Annuity Account Five buys and sells shares of a
Portfolio at NAV, without any sales or other charges.
EXECUTION OF REQUESTS. The Trust is open on those days when the New York Stock
Exchange is open for regular trading. We execute buy and sell requests at the
next NAV to be calculated after the Trust accepts the request. If the Trust
receives the order before the Trust's close of business (generally 4:00 p.m.,
Eastern time), the order will receive that day's closing price. If the Trust
receives the order after that time, it will receive the next business day's
closing price.
During periods of extreme volatility or market crisis, a Portfolio may
temporarily suspend the processing of sell requests or may postpone payment of
proceeds for up to seven business days or longer, or as allowed by federal
securities laws.
DIVIDEND POLICIES AND TAXES
DISTRIBUTIONS. Each Portfolio annually declares and distributes substantially
all of its net investment income in the form of dividends and capital gains
distributions.
DISTRIBUTION REINVESTMENT. The dividends and distributions will be reinvested
automatically in additional shares of the same Portfolio on which they were
paid.
TAXABILITY OF A PORTFOLIO. Each Portfolio intends to continue to qualify as a
regulated investment company under the Internal Revenue Code of 1986, as
amended. So long as each Portfolio is qualified as a regulated investment
company, it will not be subject to federal income tax on the earnings that it
distributes to its shareholders.
21
<PAGE>
--------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
--------------------------------------------------------------------------------
The following Financial Highlights table for each Portfolio is intended to help
you understand the Portfolios' financial performance since inception. Certain
information reflects financial results for a single Portfolio share. The total
returns in the table represent the rate that an investor would have earned on an
investment in the Portfolio (assuming reinvestment of all dividends and
distributions). This information has been audited by PricewaterhouseCoopers LLP,
whose report, along with each Portfolio's financial statements, is included in
the Trust's annual report to shareholders, which is available upon request.
<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------------------------------
Net
Net realized & Dividends Dividends
Asset unrealized declared from net Net Asset
Value Net gain (loss) Total from from net realized Value
beginning investment on investment investment gain on end of Total
Period ended of period income*/** investments operations income investments period Return***
-----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Multi-Managed Growth Portfolio
4/15/97-3/31/98 $10.00 $0.18 $2.95 $ 3.13 ($0.08) ($0.20) $12.85 31.55%
3/31/99 12.85 0.16 4.41 4.57 (0.18) (0.03) 17.21 35.98
3/31/00 17.21 0.18 7.72 7.90 (0.19) (3.44) 21.48 49.03
Multi-Managed Moderate Growth Portfolio
4/15/97-3/31/98 10.00 0.27 2.40 2.67 (0.13) (0.17) 12.37 26.86
3/31/99 12.37 0.28 3.10 3.38 (0.23) (0.02) 15.50 27.73
3/31/00 15.50 0.33 5.24 5.57 (0.30) (2.17) 18.60 37.90
Multi-Managed Income/Equity Portfolio
4/15/97-3/31/98 10.00 0.41 1.68 2.09 (0.20) (0.10) 11.79 21.10
3/31/99 11.79 0.43 1.57 2.00 (0.36) (0.10) 13.33 17.27
3/31/00 13.33 0.49 1.87 2.36 (0.41) (0.99) 14.29 18.52
Multi-Managed Income Portfolio
4/15/97-3/31/98 10.00 0.51 1.15 1.66 (0.27) (0.10) 11.29 16.81
3/31/99 11.29 0.53 0.72 1.25 (0.40) (0.07) 12.07 11.19
3/31/00 12.07 0.57 0.49 1.06 (0.54) (0.40) 12.19 9.16
Asset Allocation: Diversified Growth Portfolio
4/15/97-3/31/98 10.00 0.23 1.76 1.99 (0.12) (0.16) 11.71 20.09
3/31/99 11.71 0.14 0.90 1.04 (0.12) -- 12.63 9.02
3/31/00 12.63 0.21 2.04 2.25 (0.22) (0.71) 13.95 18.14
Stock Portfolio
4/15/97-3/31/98 10.00 0.03 4.80 4.83 (0.02) (0.15) 14.66 48.59
3/31/99 14.66 0.03 1.84 1.87 (0.02) (0.30) 16.21 13.05
3/31/00 16.21 (0.01) 4.47 4.46 -- (1.07) 19.60 28.35
---------------------------------------------------------------------------------------------------------------- ----------
<CAPTION>
--------------------- ------------------------------------------------
Net Ratio of Ratio of net
Assets expenses investment
end of to average income to
period net average net Portfolio
Period ended (000's) assets+ assets+ turnover
--------------------- ------------------------------------------------
<S> <C> <C> <C> <C>
Multi-Managed Growth Portfolio
4/15/97-3/31/98 $32,481 1.29%# 1.52%# 114%
3/31/99 69,712 1.19 1.11 124
3/31/00 103,976 1.15 0.98 117
Multi-Managed Moderate Growth Portfolio
4/15/97-3/31/98 32,622 1.21# 2.36# 101
3/31/99 75,694 1.16 2.08 105
3/31/00 107,421 1.10 1.97 108
Multi-Managed Income/Equity Portfolio
4/15/97-3/31/98 25,957 1.14# 3.72# 46
3/31/99 62,121 1.14 3.51 65
3/31/00 74,778 1.10 3.61 68
Multi-Managed Income Portfolio
4/15/97-3/31/98 18,378 1.06# 4.69# 47
3/31/99 50,250 1.06 4.50 43
3/31/00 54,037 1.06 4.72 61
Asset Allocation: Diversified Growth Portfolio
4/15/97-3/31/98 50,384 1.21# 2.06# 166
3/31/99 117,663 1.21 1.21 149
3/31/00 161,058 1.21 1.58 156
Stock Portfolio
4/15/97-3/31/98 42,085 1.21# 0.24# 46
3/31/99 97,047 1.10 0.20 52
3/31/00 132,831 1.06 (0.05) 75
--------------------- ------------------------------------------------
</TABLE>
* Calculated based upon average shares outstanding
** After fee waivers and expense reimbursements by the investment adviser
*** Total return is not annualized and does not reflect expenses that apply to
the separate accounts of Anchor National Life Insurance Company. If such
expenses had been included, total return would have been lower.
# Annualized
+ The investment adviser waived a portion of or all fees and assumed a portion
of or all expenses for the Portfolios. If all fees and expenses had been
incurred by the Portfolios, the ratio of expenses to average net assets and
the ratio of net investment income to average net assets would have been as
follows:
<TABLE>
<CAPTION>
Expenses Net Investment Income
3/31/98 3/31/99 3/31/00 3/31/98 3/31/99 3/31/00
<S> <C> <C> <C> <C> <C> <C>
------------------------------------------------------------------
Multi-Managed Growth Portfolio.............................. 1.44% 1.19% 1.15% 1.37% 1.11% 0.98%
Multi-Managed Moderate Growth Portfolio..................... 1.40 1.16 1.10 2.17 2.08 1.97
Multi-Managed Income/Equity Portfolio....................... 1.43 1.14 1.10 3.43 3.51 3.61
Multi-Managed Income Portfolio.............................. 1.50 1.07 1.08 4.25 4.49 4.70
Asset Allocation: Diversified Growth Portfolio.............. 1.53 1.22 1.21 1.74 1.20 1.58
Stock Portfolio............................................. 1.26 1.10 1.06 0.19 0.20 (0.05)
</TABLE>
22
<PAGE>
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FOR MORE INFORMATION
--------------------------------------------------------------------------------
The following documents contain more information about the Portfolios and
are available free of charge upon request:
ANNUAL/SEMI-ANNUAL REPORTS. Contain financial statements, performance data
and information on portfolio holdings. The annual report also contains a
written analysis of market conditions and investment strategies that
significantly affected a Portfolio's performance for the most recently
completed fiscal year.
STATEMENT OF ADDITIONAL INFORMATION (SAI). Contains additional information
about the Portfolios' policies, investment restrictions and business
structure. This prospectus incorporates the SAI by reference.
You may obtain copies of these documents or ask questions about the
Portfolios by contacting:
Anchor National Life Insurance Company
Annuity Service Center
P.O. Box 54299
Los Angeles, California 90054-0299
1-800-445-7862
Information about the Portfolios (including the SAI) can be reviewed and copied
at the Public Reference Room of the Securities and Exchange Commission,
Washington, D.C. Call (800) SEC-0330 for information on the operation of the
Public Reference Room. Information about the Portfolios is also available on the
Securities and Exchange Commission's web-site at http://www.sec.gov and copies
may be obtained upon payment of a duplicating fee by electronic request at the
following e-mail address: [email protected], or by writing the Public Reference
Section of the Securities and Exchange Commission, Washington, D.C. 20549-6009.
You should rely only on the information contained in this prospectus. No one is
authorized to provide you with any different information.
INVESTMENT COMPANY ACT
File No. 811-07725
23
