THE VARIABLE ANNUITY LIFE INSURANCE COMPANY
SEPARATE ACCOUNT A
PORTFOLIO DIRECTOR
PORTFOLIO DIRECTOR 2
PORTFOLIO DIRECTOR PLUS
PORTFOLIO DIRECTOR T
Supplement issued March 31, 2000
To the Prospectus dated May 1, 1999
The Variable Annuity Life Insurance
Company (the "Company") filed an application
with the Securities and Exchange Commission
("SEC") today requesting an order allowing
the Company to replace the shares of
American General Domestic Bond Fund of
American General Series Portfolio Company 3
("AGSPC 3"), T. Rowe Price Small-Cap Stock
Fund, Dreyfus Variable Investment Fund -
Small Cap Portfolio, Scudder Growth and
Income Fund, Neuberger Berman Guardian Trust
and Dreyfus Founders Growth Fund, each of
which is a Variable Investment Option
currently available under our group and
individual variable annuity contracts, with
shares of comparable series of AGSPC 3 and
newly created series of American General
Series Portfolio Company ("AGSPC").
The Company believes that the proposed
substitutions are in the best interest of
contract holders. In each case, the
Substitute Series will have substantially
the same investment objective, practices and
restrictions as the Replaced Series. In the
case of Dreyfus Variable Investment Fund --
Small Cap Portfolio and T. Rowe Price Small-
Cap Stock Fund, Inc., the Substitute Series
will have two sub-advisers, one of which is
the Replaced Series' current investment
adviser, T. Rowe Price Associates, Inc., and
an additional sub-adviser, Founders Asset
Management LLC, which has an outstanding
long-term investment performance record. In
the case of Dreyfus Founders Growth Fund,
the Substitute Series will have the Replaced
Series' current investment adviser, Founders
Asset Management LLC, as its sub-adviser.
In the case of the other Replaced Series,
the Substitute Series will have as sub-
advisers new managers with superior long-
term investment performance records in their
respective asset classes.
The proposed substitutions and
respective sub-advisers are:
Replaced Series Substitute Series
Dreyfus Variable AGSPC American
Investment Fund - General Select
Small Cap Small Cap Fund
Portfolio (T. Rowe Price
Associates, Inc.
and Founders Asset
Management LLC)
T. Rowe Price AGSPC American
Small-Cap Stock General Select
Fund, Inc. Small Cap Fund
(T. Rowe Price
Associates, Inc.
and Founders Asset
Management LLC)
Replaced Series Substitute Series
Scudder Growth AGSPC American
and Income Fund General American
Century Income &
Growth Fund
(American Century
Investment
Management, Inc.)
Neuberger Berman AGSPC American
Guardian Trust General American
Century Income &
Growth Fund
(American Century
Investment
Management, Inc.)
Dreyfus Founders AGSPC American
Growth Fund General Founders
Growth Fund
(Founders Asset
Management LLC)
AGSPC 3 American AGSPC 3 American
General Domestic General Core Bond
Bond Fund Fund
(American General
Investment
Management, L.P.)
You should note that:
o No action is required on your
part. You will not need to vote a
proxy, file a new election, or
take any other action if the SEC
approves the substitutions.
o The elections you have on file for
allocating your account value,
premium payments and deductions
will remain unchanged until you
direct us otherwise.
o You will not bear any expenses
relating to the substitutions.
o Although for two of the
substitutions (Dreyfus Variable
Investment Fund - Small Cap
Portfolio and Scudder Growth and
Income Fund) total contract holder
expenses are expected to be
slightly higher for the Replaced
Series, the substitutions will
result in a change to a
sub-adviser with a superior
performance record.
o On the effective date of the
substitution, your account value
in the Variable Account Option
will be the same as before the
substitution.
o The substitution will have no tax
consequences for you.
The Company expects to complete the
substitutions before October 2000. The
newly created series of AGSPC will commence
operations at the time of the substitutions.
Completion of the substitutions is
conditioned upon obtaining the approval of
the SEC and state insurance authorities, if
applicable. Of course, you may transfer
amounts in your Contract among the Variable
Investment Options and Fixed Options, as
usual. The substitutions will not be
treated as a transfer for purposes of the
transfer provisions of your Contract. In
addition, any transfer charge that might
otherwise be imposed will be waived from the
date of this Notice through the date that is
30 days after the substitutions.
We will send you a prospectus for
AGSPC 3 and the new series of AGSPC, and
notice of the actual date of the
substitutions, after we receive SEC
approval. You will receive confirmation
when the substitution is complete.
Should you have any questions, you may
contact us at 1-800-448-2542 (selection 1).
VA 033100
