<PAGE> 1
File Nos.33-85014
811-8810
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-4
REGISTRATION STATEMENT UNDER THE SECURITIES
ACT OF 1933 [ X ]
Pre-Effective Amendment No. [ ]
Post-Effective Amendment No. 12 [ X ]
and/or
REGISTRATION STATEMENT UNDER THE INVESTMENT
COMPANY ACT OF 1940 [ X ]
Amendment No. 14
(Check appropriate box or boxes)
FS VARIABLE SEPARATE ACCOUNT
(Exact Name of Registrant)
First SunAmerica Life Insurance Company
(Name of Depositor)
733 Third Avenue, 4th Floor
New York, New York 10017
(Address of Depositor's Principal Offices) (Zip Code)
Depositor's Telephone Number, including Area Code: (310) 772-6000
Susan L. Harris, Esq.
First SunAmerica Life Insurance Company
c/o SunAmerica Inc.
1 SunAmerica Center
Los Angeles, California 90067-6022
(Name and Address of Agent for Service)
It is proposed that this filing will become effective:
immediately upon filing pursuant to paragraph (b) of Rule 485
--
X on March 31, 2000 pursuant to paragraph (b) of Rule 485
--
60 days after filing pursuant to paragraph (a)(1) of Rule 485
--
on [ ] pursuant to paragraph (a)(1) of Rule 485
--
<PAGE> 2
FS VARIABLE SEPARATE ACCOUNT
Cross Reference Sheet
PART A - PROSPECTUS
Incorporated herein by reference to Post-Effective Amendment No. 11 under
Securities Act of 1933 (the 33 Act) and No. 13 under the Investment Company Act
of 1940 (the 40 Act) to Registration Statement file No. 33-85014 and 811-8810
filed on Form N-4 on December 6, 1999.
<PAGE> 3
PART B - STATEMENT OF ADDITIONAL INFORMATION
Incorporated herein by reference to Post-Effective Amendment No. 11 under
Securities Act of 1933 (the 33 Act) and No. 13 under the Investment Company Act
of 1940 (the 40 Act) to Registration Statement file No. 33-85014 and 811-8810
filed on Form N-4 on December 6, 1999.
PART C
Information required to be included in Part C is set forth under the
appropriate item, so numbered, in Part C of this Registration Statement.
<PAGE> 4
[POLARIS LOGO]
PROFILE
December 13, 1999
Incorporated herein by reference to Post-Effective Amendment No. 11 under
Securities Act of 1933 (the 33 Act) and No. 13 under the Investment Company Act
of 1940 (the 40 Act) to Registration Statement file No. 33-85014 and 811-8810
filed on Form N-4 on December 6, 1999.
<PAGE> 5
[POLARIS LOGO]
PROSPECTUS
December 13, 1999
Incorporated herein by reference to Post-Effective Amendment No. 11 under
Securities Act of 1933 (the 33 Act) and No. 13 under the Investment Company Act
of 1940 (the 40 Act) to Registration Statement file No. 33-85014 and 811-8810
filed on Form N-4 on December 6, 1999.
<PAGE> 6
STATEMENT OF ADDITIONAL INFORMATION
Fixed and Variable Deferred Annuity Contracts
issued by
FS VARIABLE SEPARATE ACCOUNT
DEPOSITOR: FIRST SUNAMERICA LIFE INSURANCE COMPANY
This Statement of Additional Information is not a prospectus; it should be read
with the prospectus, dated March 31, 2000, relating to the annuity contracts
described above, a copy of which may be obtained without charge by written
request addressed to:
First SunAmerica Life Insurance Company
Annuity Service Center
P.O. Box 54299
Los Angeles, California 90054-0299
THE DATE OF THIS STATEMENT OF ADDITIONAL INFORMATION IS
MARCH 31, 2000
<PAGE> 7
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Separate Account................................................................................. 3
General Account.................................................................................. 4
Performance Data................................................................................. 4
Income Payments.................................................................................. 9
Annuity Unit Values.............................................................................. 10
Taxes............................................................................................ 13
Distribution of Contracts........................................................................ 18
Financial Statements............................................................................. 18
</TABLE>
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SEPARATE ACCOUNT
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FS Variable Separate Account was originally established by the First
SunAmerica Life Insurance Company (the "Company") on September 9, 1994, pursuant
to the provisions of New York law, as a segregated asset account of the Company.
The separate account meets the definition of a "separate account" under the
federal securities laws and is registered with the Securities and Exchange
Commission (the "SEC") as a unit investment trust under the Investment Company
Act of 1940. This registration does not involve supervision of the management of
the separate account or the Company by the SEC.
The assets of the separate account are the property of the Company.
However, the assets of the separate account, equal to its reserves and other
contract liabilities, are not chargeable with liabilities arising out of any
other business the Company may conduct. Income, gains, and losses, whether or
not realized, from assets allocated to the separate account are credited to or
charged against the separate account without regard to other income, gains, or
losses of the Company.
The separate account is divided into Variable Portfolios, with the assets
of each Variable Portfolio invested in the shares of one of the underlying
funds. The Company does not guarantee the investment performance of the separate
account, its Variable Portfolios or the underlying funds. Values allocated to
the separate account and the amount of variable income payments will vary with
the values of shares of the underlying funds, and are also reduced by contract
charges.
The basic objective of a variable annuity contract is to provide variable
income payments which will be to some degree responsive to changes in the
economic environment, including inflationary forces and changes in rates of
return available from various types of investments. The contract is designed to
seek to accomplish this objective by providing that variable income payments
will reflect the investment performance of the separate account with respect to
amounts allocated to it both before and after the Annuity Date. Since the
separate account is always fully invested in shares of the underlying funds, its
investment performance reflects the investment performance of those entities.
The values of such shares held by the separate account fluctuate and are subject
to the risks of changing economic conditions as well as the risk inherent in the
ability of the underlying funds' managements to make necessary changes in their
Variable Portfolios to anticipate changes in economic conditions. Therefore, the
owner bears the entire investment risk that the basic objectives of the contract
may not be realized, and that the adverse effects of inflation may not be
lessened. There can be no assurance that the aggregate amount of variable income
payments will equal or exceed the Purchase Payments made with respect to a
particular account for the reasons described above, or because of the premature
death of an Annuitant.
Another important feature of the contract related to its basic objective is
the Company's promise that the dollar amount of variable income payments made
during the lifetime of the Annuitant will not be adversely affected by the
actual mortality experience of the Company or by the actual expenses incurred by
the Company in excess of expense deductions provided for in the contract
(although the Company does not guarantee the amounts of the variable income
payments).
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<PAGE> 9
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GENERAL ACCOUNT
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The General Account is made up of all of the general assets of the Company
other than those allocated to the separate account or any other segregated asset
account of the Company. A Purchase Payment may be allocated to the 1, 3, 5, 7 or
10 year fixed account options and the DCA fixed accounts for 6-month and 1-year
periods available in connection with the general account, as elected by the
owner at the time of purchasing a contract or when making a subsequent Purchase
Payment. Assets supporting amounts allocated to fixed account option become part
of the Company's general account assets and are available to fund the claims of
all classes of customers of the Company, as well as of its creditors.
Accordingly, all of the Company's assets held in the general account will be
available to fund the Company's obligations under the contracts as well as such
other claims.
The Company will invest the assets of the general account in the manner
chosen by the Company and allowed by applicable state laws regarding the nature
and quality of investments that may be made by life insurance companies and the
percentage of their assets that may be committed to any particular type of
investment. In general, these laws permit investments, within specified limits
and subject to certain qualifications, in federal, state and municipal
obligations, corporate bonds, preferred and common stocks, real estate
mortgages, real estate and certain other investments.
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PERFORMANCE DATA
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From time to time the separate account may advertise the Cash Management
Portfolio's "yield" and "effective yield." Both yield figures are based on
historical earnings and are not intended to indicate future performance. The
"yield" of the Cash Management Portfolio refers to the net income generated for
a contract funded by an investment in the Portfolio (which invests in shares of
the Cash Management Portfolio of SunAmerica Series Trust) over a seven-day
period (which period will be stated in the advertisement). This income is then
"annualized." That is, the amount of income generated by the investment during
that week is assumed to be generated each week over a 52-week period and is
shown as a percentage of the investment. The "effective yield" is calculated
similarly but, when annualized, the income earned by an investment in the
Variable Portfolio is assumed to be reinvested at the end of each seven day
period. The "effective yield" will be slightly higher than the "yield" because
of the compounding effect of this assumed reinvestment. Neither the yield nor
the effective yield takes into consideration the effect of any capital changes
that might have occurred during the seven day period, nor do they reflect the
impact of any withdrawal charges. The impact of other recurring charges on both
yield figures is, however, reflected in them to the same extent it would affect
the yield (or effective yield) for a contract of average size.
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<PAGE> 10
In addition, the separate account may advertise "total return" data for its
other Variable Portfolios. Like the yield figures described above, total return
figures are based on historical data and are not intended to indicate future
performance. The "total return" is a computed rate of return that, when
compounded annually over a stated period of time and applied to a hypothetical
initial investment in a Variable Portfolio made at the beginning of the period,
will produce the same contract value at the end of the period that the
hypothetical investment would have produced over the same period (assuming a
complete redemption of the contract at the end of the period). Recurring
contract charges are reflected in the total return figures in the same manner as
they are reflected in the yield data for contracts funded through the Cash
Management Portfolio. The effect of applicable withdrawal charges due to the
assumed redemption will be reflected in the return figures, but may be omitted
in additional return figures given for comparison.
For periods starting prior to the date the Variable Portfolios first became
available through the Separate Accounts the total return data for the Variable
Portfolios of the separate account will be derived from the performance of the
corresponding underlying funds of Anchor Series Trust and SunAmerica Series
Trust, modified to reflect the charges and expenses as if the separate account
Variable Portfolio had been in existence since the inception date of each
respective Anchor Series Trust and SunAmerica Series Trust underlying fund.
Thus, such performance figures should not be construed to be actual historic
performance of the relevant separate account Variable Portfolio. Rather, they
are intended to indicate the historical performance of the corresponding
Variable Portfolios of Anchor Series Trust and SunAmerica Series Trust, adjusted
to provide direct comparability to the performance of the Variable Portfolios
after the date the Variable Portfolio became available with the separate account
(which will reflect the effect of fees and charges imposed under the contracts).
Anchor Series Trust and SunAmerica Series Trust have served since their
inception as underlying investment media for separate accounts of other
insurance companies in connection with variable contracts not having the same
fee and charge schedules as those imposed under the contracts.
Performance data for the various Variable Portfolios are computed in the
manner described below.
CASH MANAGEMENT PORTFOLIO
The annualized current yield and the effective yield for the Cash
Management Portfolio for the 7 day period ending December 31, 1999 were 4.57%
and 4.68%, respectively.
Current yield is computed by first determining the Base Period Return
attributable to a hypothetical contract having a balance of one Accumulation
Unit at the beginning of a 7 day period using the formula:
Base Period Return = (EV-SV-CMF)/(SV)
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<PAGE> 11
where:
SV = value of one Accumulation Unit at the start of a 7 day period
EV = value of one Accumulation Unit at the end of the 7 day period
CMF = an allocated portion of the $30 annual Contract Maintenance Fee,
prorated for 7 days
The change in the value of an Accumulation Unit during the 7 day period
reflects the income received minus any expenses accrued, during such 7 day
period. The Contract Maintenance Fee (CMF) is first allocated among the Variable
Portfolios and the general account so that each Variable Portfolio's allocated
portion of the fee is proportional to the percentage of the number of accounts
that have money allocated to that Variable Portfolio. The fee is further
reduced, for purposes of the yield computation, by multiplying it by the ratio
that the value of the hypothetical contract bears to the value of an account of
average size for contracts funded by the Cash Management Portfolio. Finally, as
is done with the other charges discussed above, the result is multiplied by the
fraction 7/365 to arrive at the portion attributable to the 7 day period.
The current yield is then obtained by annualizing the Base Period Return:
Current Yield = (Base Period Return) x (365/7)
The Cash Management Portfolio also quotes an "effective yield" that differs
from the current yield given above in that it takes into account the effect of
dividend reinvestment in the underlying fund. The effective yield, like the
current yield, is derived from the Base Period Return over a 7 day period.
However, the effective yield accounts for dividend reinvestment by compounding
the current yield according to the formula:
Effective Yield = [(Base Period Return + 1) 365/7 - 1].
Net investment income for yield quotation purposes will not include either
realized capital gains and losses or unrealized appreciation and depreciation,
whether reinvested or not. The yield quotations also do not reflect any impact
of transfer fees or withdrawal charges.
The yield quoted should not be considered a representation of the yield of
the Cash Management Portfolio in the future since the yield is not fixed. Actual
yields will depend not only on the type, quality and maturities of the
investments held by the underlying fund and changes in interest rates on such
investments, but also on factors such as an owner's account size (since the
impact of fixed dollar charges will be greater for small accounts than for
larger accounts).
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<PAGE> 12
Yield information may be useful in reviewing the performance of the Cash
Management Portfolio and for providing a basis for comparison with other
investment alternatives. However, the Cash Management Portfolio's yield
fluctuates, unlike bank deposits or other investments that typically pay a fixed
yield for a stated period of time.
OTHER VARIABLE PORTFOLIOS
The Variable Portfolios of the separate account other than the Cash
Management Portfolio compute their performance data as "total return".
The total returns of the various Variable Portfolios since each Variable
Portfolio's inception date are shown on the next page, both with and without an
assumed complete redemption at the end of the period.
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<PAGE> 13
TOTAL ANNUAL RETURN (IN PERCENT) FOR
PERIOD ENDING DECEMBER 31, 1999
(RETURN WITH/WITHOUT REDEMPTION)
<TABLE>
<CAPTION>
INCEPTION SINCE
VARIABLE PORTFOLIO DATE 1 YEAR INCEPTION
------------------ ---- ------ ---------
<S> <C> <C> <C>
Anchor Series Trust
- -------------------
Capital Appreciation 4/6/95 58.32/65.32 32.30/32.52
Growth 4/6/95 17.96/24.96 25.41/25.68
Natural Resources 5/30/95 32.30/39.30 3.89/4.46
Gov't & Quality Bond 5/3/95 -10.15/-3.15 4.46/5.00
SunAmerica Series Trust
- -----------------------
Emerging Markets 6/12/97 67.59/74.59 0.68/2.59
International Diversified Equities 4/12/95 15.61/22.61 12.65/13.05
Global Equities 5/22/95 21.89/28.89 18.41/18.76
International Growth and Income 6/9/97 15.29/22.29 11.77/13.39
MFS Mid-Cap Growth 10/19/99 ---- 32.96/39.96
Aggressive Growth 6/3/96 74.82/81.82 27.51/28.10
Real Estate 6/2/97 -15.99/-8.99 -6.64/-4.52
Putnam Growth 4/6/95 20.70/27.70 26.28/26.54
MFS Growth and Income* 4/6/95 -2.70/4.30 18.07/18.41
Alliance Growth 4/6/95 24.05/31.05 35.25/35.45
"Dogs" of Wall Street 10/19/99 -15.55/-8.55 -9.36/-2.36
Venture Value 4/6/95 7.33/14.33 21.73/22.03
Federated Value 6/3/96 -2.45/4.55 14.95/15.72
Growth-Income 4/12/95 21.04/28.04 27.82/28.07
Utility 6/3/96 -6.83/0.17 11.32/12.16
Asset Allocation 4/24/95 0.77/7.77 12.27/12.69
MFS Total Return** 5/8/95 -5.74/1.26 11.70/12.13
SunAmerica Balanced 6/3/96 12.5/19.5 20.11/20.81
Worldwide High Income 5/2/95 10.40/17.40 9.33/9.79
High-Yield Bond 5/8/95 -2.12/4.88 5.77/6.29
Corporate Bond 4/12/95 -10.38-3.38 4.22/4.76
Global Bond 5/2/95 -9.55/-2.55 6.21/6.72
</TABLE>
- -----------------
* Formerly named Growth/Phoenix and managed by Phoenix Investment Counsel,
Inc.
** Formerly named Balanced/Phoenix and managed by Phoenix Investment Counsel,
Inc.
Total return figures are based on historical data and are not intended to
indicate future performance.
-8-
<PAGE> 14
HYPOTHETICAL ADJUSTED HISTORICAL PERFORMANCE
TOTAL ANNUAL RETURNS (IN PERCENT) FOR
PERIOD ENDING DECEMBER 31, 1999
<TABLE>
<CAPTION>
INCEPTION SINCE
VARIABLE PORTFOLIO DATE 1 YEAR 5 YEAR 10 YEAR INCEPTION
------------------ ---- ------ ------ -------- ----------
<S> <C> <C> <C> <C> <C>
Anchor Series Trust
- -------------------
Capital Appreciation 4/6/95 58.32/65.32 31.81/32.01 21.71 32.30/32.52
Growth 4/6/95 17.96/24.96 25.29/25.53 15.69 25.41/25.68
Natural Resources 5/30/95 32.30/39.30 5.23/5.72 4.31 3.89/4.46
Government and Quality Bond 5/3/95 -10.15/-3.15 5.48/5.96 5.84 4.46/5.00
SunAmerica Series Trust
- -----------------------
Emerging Markets 6/12/97 67.59/74.59 N/A N/A 0.68/2.59
International Diversified Equities 4/12/95 15.61/22.61 11.45/11.84 N/A 12.65/13.05
Global Equities 5/22/95 21.89/28.89 18.11/18.42 N/A 18.41/18.76
International Growth & Income 6/9/97 15.29/22.29 N/A N/A 11.77/13.39
MFS Mid Cap Growth 10/19/99 N/A N/A N/A 32.96/39.96
Aggressive Growth 6/3/96 74.82/81.82 N/A N/A 27.51/28.10
Real Estate 6/2/97 -15.99/-8.99 N/A N/A -6.64/-4.52
Putnam Growth 4/6/95 20.70/27.70 26.09/26.33 N/A 26.28/26.54
MFS Growth and Income 4/6/95 -2.70/4.30 18.77/19.07 N/A 18.07/18.41
Alliance Growth 4/6/95 24.05/31.05 35.37/35.55 N/A 35.25/35.45
"Dogs" of Wall Street 10/19/99 -15.55/-8.55 N/A N/A -9.36/-2.36
Venture Value 4/6/95 7.33/14.33 22.75/23.01 N/A 21.73/22.03
Federated Value 6/3/96 -2.45/4.55 N/A N/A 14.95/15.72
Growth-Income 4/12/95 21.04/28.04 28.29/28.51 N/A 27.82/28.07
Utility 6/3/96 -6.83/0.17 N/A N/A 11.32/12.16
Asset Allocation 4/24/95 0.77/7.77 13.5/13.86 N/A 12.27/12.69
MFS Total Return 5/8/95 -5.74/1.26 12.9/13.27 N/A 11.70/12.13
SunAmerica Balanced 6/3/96 12.50/19.50 N/A N/A 20.11/20.81
Worldwide High Income 5/2/95 10.40/17.40 9.49/9.9 N/A 9.33/9.79
High-Yield Bond 5/8/95 -2.12/4.88 7.01/7.46 N/A 5.77/6.29
Corporate Bond 4/12/95 -10.38/-3.38 5.09/5.58 N/A 4.22/4.76
Global Bond 5/2/95 -9.55/-2.55 7.06/7.52 N/A 6.21/6.72
</TABLE>
Total return figures are based on historical data and are not intended to
indicate future performance.
<PAGE> 15
Total return for a Variable Portfolio represents a single computed annual
rate of return that, when compounded annually over the time period shown and
applied to a hypothetical initial investment in a contract funded by that
Variable Portfolio made at the beginning of the period, will produce the same
contract value at the end of the period that the hypothetical investment would
have produced over the same period. The total rate of return (T) is computed so
that it satisfies the formula:
P(1+T)n = ERV
where: P = a hypothetical initial payment of $1,000
T = average annual total return
n = number of years
ERV = ending redeemable value of a hypothetical $1,000
payment made at the beginning of the 1, 5, or 10 year
period as of the end of the period (or fractional
portion thereof).
The total return figures reflect the effect of both nonrecurring and
recurring charges, as discussed herein. Recurring charges are taken into account
in a manner similar to that used for the yield computations for the Cash
Management Portfolio, described above. The applicable withdrawal charge (if any)
is deducted as of the end of the period, to reflect the effect of the assumed
complete redemption. Because the impact of Contract Maintenance Fees on a
particular account will generally differ from that assumed in the computation,
due to differences between most actual allocations and the assumed one, as well
as differences due to varying account sizes, the total return experienced by an
actual Variable Portfolio over the same time periods would generally have been
different from those produced by the computation. As with the Cash Management
Portfolio yield figures, total return figures are derived from historical data
and are not intended to be a projection of future performance.
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INCOME PAYMENTS
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INITIAL MONTHLY INCOME PAYMENTS
The initial income payment is determined by applying separately that
portion of the contract value allocated to the fixed account option and the
Variable Portfolio(s) and then applying it to the annuity table specified in the
contract for fixed and variable income payments. Those tables are based on a set
amount per $1,000 of proceeds applied. The appropriate rate must be determined
by the sex (except where, as in the case of certain Qualified contracts and
other employer-sponsored retirement plans, such classification is not permitted)
and age of the Annuitant and designated second person, if any.
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<PAGE> 16
The dollars applied are then divided by 1,000 and the result multiplied by
the appropriate annuity factor appearing in the table to compute the amount of
the first monthly income payment. In the case of a variable annuity, that amount
is divided by the value of an Annuity Unit as of the Annuity Date to establish
the number of Annuity Units representing each variable income payment. The
number of Annuity Units determined for the first variable income payment remains
constant for the second and subsequent monthly variable income payments,
assuming that no reallocation of contract values is made.
SUBSEQUENT MONTHLY INCOME PAYMENTS
For fixed income payments, the amount of the second and each subsequent
monthly income payment is the same as that determined above for the first
monthly payment.
For variable income payments, the amount of the second and each subsequent
monthly income payment is determined by multiplying the number of Annuity Units,
as determined in connection with the determination of the initial monthly
payment, above, by the Annuity Unit value as of the day preceding the date on
which each income payment is due.
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ANNUITY UNIT VALUES
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The value of an Annuity Unit is determined independently for each Variable
Portfolio.
The annuity tables contained in the contract are based on a 3.5% per annum
assumed investment rate. If the actual net investment rate experienced by a
Variable Portfolio exceed 3.5%, variable income payments derived from
allocations to that Variable Portfolio will increase over time. Conversely, if
the actual rate is less than 3.5%, variable income payments will decrease over
time. If the net investment rate equals 3.5%, the variable income payments will
remain constant. If a higher assumed investment rate had been used, the initial
monthly payment would be higher, but the actual net investment rate would also
have to be higher in order for income payments to increase (or not to decrease).
The payee receives the value of a fixed number of Annuity Units each month.
The value of a fixed number of Annuity Units will reflect the investment
performance of the Variable Portfolios elected, and the amount of each annuity
payment will vary accordingly.
For each Variable Portfolio, the value of an Annuity Unit is determined by
multiplying the Annuity Unit value for the preceding month by the Net Investment
Factor for the month for which the Annuity Unit value is being calculated. The
result is then multiplied by a second factor which offsets the effect of the
assumed net investment rate of 3.5% per annum which is assumed in the annuity
tables contained in the contract.
NET INVESTMENT FACTOR
The Net Investment Factor ("NIF") is an index applied to measure the net
investment performance of a Variable Portfolio from one day to the next. The NIF
may be greater or less
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<PAGE> 17
than or equal to one; therefore, the value of an Annuity Unit may increase,
decrease or remain the same.
The NIF for any Variable Portfolio for a certain month is determined by
dividing (a) by (b) where:
(a) is the Accumulation Unit value of the Portfolio determined as of the
end of that month, and
(b) is the Accumulation Unit value of the Variable Portfolio determined as
of the end of the preceding month.
The NIF for a Variable Portfolio for a given month is a measure of the net
investment performance of the Variable Portfolio from the end of the prior month
to the end of the given month. A NIF of 1.000 results in no change; a NIF
greater than 1.000 results in an increase; and a NIF less than 1.000 results in
a decrease. The NIF is increased (or decreased) in accordance with the increases
(or decreases, respectively) in the value of a share of the underlying fund in
which the Variable Portfolio invests; it is also reduced by separate account
asset charges.
Illustrative Example
Assume that one share of a given Variable Portfolio had an Accumulation
Unit value of $11.46 as of the close of the New York Stock Exchange ("NYSE") on
the last business day in September; that its Accumulation Unit value had been
$11.44 at the close of the NYSE on the last business day at the end of the
previous month. The NIF for the month of September is:
NIF = ($11.46/$11.44)
= 1.00174825
Illustrative Example
The change in Annuity Unit value for a Variable Portfolio from one month to
the next is determined in part by multiplying the Annuity Unit value at the
prior month end by the NIF for that Variable Portfolio for the new month. In
addition, however, the result of that computation must also be multiplied by an
additional factor that takes into account, and neutralizes, the assumed
investment rate of 3.5 percent per annum upon which the income payment tables
are based. For example, if the net investment rate for a Variable Portfolio
(reflected in the NIF) were equal to the assumed investment rate, the variable
income payments should remain constant (i.e., the Annuity Unit value should not
change). The monthly factor that neutralizes the assumed investment rate of 3.5
percent per annum is:
1/[(1.035)(1/12) ] = 0.99713732
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<PAGE> 18
In the example given above, if the Annuity Unit value for the Variable
Portfolio was $10.103523 on the last business day in August, the Annuity Unit
value on the last business day in September would have been:
$10.103523 x 1.00174825 x 0.99713732 = $10.092213
To determine the initial payment, the initial annuity payment for variable
annuitization is calculated based on our mortality expectations and an assumed
interest rate (AIR) of 3.5%. Thus the initial variable annuity payment is the
same as the initial payment for a fixed interest payout annuity calculated at an
effective rate of 3.5%.
The NIF measures the performance of the funds that are basis for the amount
of future annuity payments. This performance is compared to the AIR, and if the
growth in the NIF is the same as the AIR rate the payment remains the same as
the prior month. If the rate of growth of the NIF is different than the AIR,
then the payment is changed proportionately to the ratio (1+NIF) / (1+AIR),
calculated on a monthly basis. If the NIF is greater than the AIR, then this
proportion is less that one and payments are decreased.
VARIABLE INCOME PAYMENTS
Illustrative Example
Assume that a male owner, P, owns a contract in connection with which P has
allocated all of his contract value to a single Variable Portfolio. P is also
the sole Annuitant and, at age 60, has elected to annuitize his contract under
Option 4, a Life Annuity With 120 Monthly Payments Guaranteed. As of the last
valuation preceding the Annuity Date, P's Account was credited with 7543.2456
Accumulation Units each having a value of $15.432655, (i.e., P's account value
is equal to 7543.2456 x $15.432655 = $116,412.31). Assume also that the Annuity
Unit value for the Variable Portfolio on that same date is $13.256932, and that
the Annuity Unit value on the day immediately prior to the second income annuity
payment date is $13.327695.
P's first variable income payment is determined from the annuity rate
tables in P's contract, using the information assumed above. From the tables,
which supply monthly income payments for each $1,000 of applied contract value,
P's first variable income payment is determined by multiplying the monthly
installment of $5.42 (Option 4 tables, male Annuitant age 60 at the Annuity
Date) by the result of dividing P's account value by $1,000:
First Payment = $5.42 x ($116,412.31/$1,000) = $630.95
The number of P's Annuity Units (which will be fixed; i.e., it will not
change unless he transfers his Account to another Account) is also determined at
this time and is equal to the amount of the first variable income payment
divided by the value of an Annuity Unit on the day immediately prior to
annuitization:
Annuity Units = $630.95/$13.256932 = 47.593968
-12-
<PAGE> 19
P's second variable income payment is determined by multiplying the number
of Annuity Units by the Annuity Unit value as of the day immediately prior to
the second payment due date:
Second Payment = 47.593968 x $13.327695 = $634.32
The third and subsequent variable income payments are computed in a manner
similar to the second variable income payment.
Note that the amount of the first variable income payment depends on the
contract value in the relevant Variable Portfolio on the Annuity Date and thus
reflects the investment performance of the Variable Portfolio net of fees and
charges during the Accumulation Phase. The amount of that payment determines the
number of Annuity Units, which will remain constant during the Income Phase
(assuming no transfers from the Variable Portfolio). The net investment
performance of the Variable Portfolio during the Income Phase is reflected in
continuing changes during this phase in the Annuity Unit value, which determines
the amounts of the second and subsequent variable income payments.
- --------------------------------------------------------------------------------
TAXES
- --------------------------------------------------------------------------------
Section 72 of the Internal Revenue Code of 1986, as amended (the "Code")
governs taxation of annuities in general. An owner is not taxed on increases in
the value of a contract until distribution occurs, either in the form of a
non-annuity distribution or as annuity payments under the annuity option
elected. For a lump sum payment received as a total surrender (total
redemption), the recipient is taxed on the portion of the payment that exceeds
the cost basis of the contract. For a payment received as a withdrawal (partial
redemption), federal tax liability is determined on a last-in, first-out basis,
meaning taxable income is withdrawn before the cost basis of the contract is
withdrawn. For contracts issued in connection with Non-Qualified plans, the cost
basis is generally the Purchase Payments, while for contracts issued in
connection with Qualified plans there may be no cost basis. The taxable portion
of the lump sum payment is taxed at ordinary income tax rates. Tax penalties may
also apply.
For annuity payments, the taxable portion is determined by a formula which
establishes the ratio that the cost basis of the contract bears to the total
value of annuity payments for the term of the annuity contract. The taxable
portion is taxed at ordinary income tax rates. Owners, Annuitants and
Beneficiaries under the contracts should seek competent financial advice about
the tax consequences of distributions under the retirement plan under which the
contracts are purchased.
The Company is taxed as a life insurance company under the Code. For
federal income tax purposes, the separate account is not a separate entity from
the Company and its operations form a part of the Company.
-13-
<PAGE> 20
WITHHOLDING TAX ON DISTRIBUTIONS
The Code generally requires the Company (or, in some cases, a plan
administrator) to withhold tax on the taxable portion of any distribution or
withdrawal from a contract. For "eligible rollover distributions" from contracts
issued under certain types of Qualified plans, 20% of the distribution must be
withheld, unless the payee elects to have the distribution "rolled over" to
another eligible plan in a direct "trustee to trustee" transfer. This
requirement is mandatory and cannot be waived by the owner. Withholding on other
types of distributions can be waived.
An "eligible rollover distribution" is the estimated taxable portion of any
amount received by a covered employee from a plan qualified under Section 401(a)
or 403(a) of the Code, or from a tax-sheltered annuity qualified under Section
403(b) of the Code (other than (1) annuity payments for the life (or life
expectancy) of the employee, or joint lives (or joint life expectancies) of the
employee and his or her designated Beneficiary, or for a specified period of ten
years or more; and (2) distributions required to be made under the Code).
Failure to "roll over" the entire amount of an eligible rollover distribution
(including an amount equal to the 20% portion of the distribution that was
withheld) could have adverse tax consequences, including the imposition of a
penalty tax on premature withdrawals, described later in this section.
Withdrawals or distributions from a contract other than eligible rollover
distributions are also subject to withholding on the estimated taxable portion
of the distribution, but the owner may elect in such cases to waive the
withholding requirement. If not waived, withholding is imposed (1) for periodic
payments, at the rate that would be imposed if the payments were wages, or (2)
for other distributions, at the rate of 10%. If no withholding exemption
certificate is in effect for the payee, the rate under (1) above is computed by
treating the payee as a married individual claiming 3 withholding exemptions.
DIVERSIFICATION - SEPARATE ACCOUNT INVESTMENTS
Section 817(h) of the Code imposes certain diversification standards on the
underlying assets of variable annuity contracts. The Code provides that a
variable annuity contract will not be treated as an annuity contract for any
period (and any subsequent period) for which the investments are not adequately
diversified, in accordance with regulations prescribed by the United States
Treasury Department ("Treasury Department"). Disqualification of the contract as
an annuity contract would result in imposition of federal income tax to the
owner with respect to earnings allocable to the contract prior to the receipt of
payments under the contract. The Code contains a safe harbor provision which
provides that annuity contracts such as the contracts meet the diversification
requirements if, as of the close of each calendar quarter, the underlying assets
meet the diversification standards for a regulated investment company, and no
more than 55% of the total assets consist of cash, cash items, U.S. government
securities and securities of other regulated investment companies.
The Treasury Department has issued regulations which establish
diversification requirements for the investment portfolios underlying variable
contracts such as the contracts. The regulations amplify the diversification
requirements for variable contracts set forth in the Code and provide an
alternative to the safe harbor provision described above. Under the regulations
an investment portfolio will be deemed adequately diversified if (1) no more
than 55% of the value of the total assets of the portfolio is represented by any
one investment; (2)
-14-
<PAGE> 21
no more than 70% of the value of the total assets of the portfolio is
represented by any two investments; (3) no more than 80% of the value of the
total assets of the portfolio is represented by any three investments; and (4)
no more than 90% of the value of the total assets of the portfolio is
represented by any four investments. For purposes of determining whether or not
the diversification standards imposed on the underlying assets of variable
contracts by Section 817(h) of the Code have been met, "each United States
government agency or instrumentality shall be treated as a separate issuer."
MULTIPLE CONTRACTS
Multiple annuity contracts which are issued within a calendar year to the
same contract owner by one company or its affiliates are treated as one annuity
contract for purposes of determining the tax consequences of any distribution.
Such treatment may result in adverse tax consequences including more rapid
taxation of the distributed amounts from such multiple contracts. The Company
believes that Congress intended to affect the purchase of multiple deferred
annuity contracts which may have been purchased to avoid withdrawal income tax
treatment. Owners should consult a tax adviser prior to purchasing more than one
annuity contract in any calendar year.
TAX TREATMENT OF ASSIGNMENTS
An assignment of a contract may have tax consequences, and may also be
prohibited by ERISA in some circumstances. Owners should therefore consult
competent legal advisers should they wish to assign their contracts.
QUALIFIED PLANS
The contracts offered by this prospectus are designed to be suitable for
use under various types of Qualified plans. Taxation of owners in each Qualified
plan varies with the type of plan and terms and conditions of each specific
plan. Owners, Annuitants and Beneficiaries are cautioned that benefits under a
Qualified plan may be subject to the terms and conditions of the plan,
regardless of the terms and conditions of the contracts issued pursuant to the
plan.
Following are general descriptions of the types of Qualified plans with
which the contracts may be used. Such descriptions are not exhaustive and are
for general information purposes only. The tax rules regarding Qualified plans
are very complex and will have differing applications depending on individual
facts and circumstances. Each purchaser should obtain competent tax advice prior
to purchasing a contract issued under a Qualified plan.
Contracts issued pursuant to Qualified plans include special provisions
restricting contract provisions that may otherwise be available and described in
this prospectus. Generally, contracts issued pursuant to Qualified plans are not
transferable except upon surrender or annuitization. Various penalty and excise
taxes may apply to contributions or distributions made in violation of
applicable limitations. Furthermore, certain withdrawal penalties and
restrictions may apply to surrenders from Qualified contracts.
-15-
<PAGE> 22
(A) H.R. 10 Plans
Section 401 of the Code permits self-employed individuals to establish
Qualified plans for themselves and their employees, commonly referred to as
"H.R. 10" or "Keogh" Plans. Contributions made to the plan for the benefit
of the employees will not be included in the gross income of the employees
until distributed from the plan. The tax consequences to owners may vary
depending upon the particular plan design. However, the Code places
limitations and restrictions on all plans and such items as: amounts of
allowable contributions; form, manner and timing of distributions; vesting
and nonforfeitability of interests; nondiscrimination in eligibility and
participation; and the tax treatment of distributions, withdrawals and
surrenders.
(B) Tax-Sheltered Annuities
Section 403(b) of the Code permits the purchase of "tax-sheltered
annuities" by public schools and certain charitable, educational and
scientific organizations described in Section 501 (c)(3) of the Code. These
qualifying employers may make contributions to the contracts for the
benefit of their employees. Such contributions are not includible in the
gross income of the employee until the employee receives distributions from
the contract. The amount of contributions to the tax-sheltered annuity is
limited to certain maximums imposed by the Code. Furthermore, the Code sets
forth additional restrictions governing such items as transferability,
distributions, nondiscrimination and withdrawals.
(C) Individual Retirement Annuities
Section 408(b) of the Code permits eligible individuals to contribute
to an individual retirement program known as an "Individual Retirement
Annuity" ("IRA"). Under applicable limitations, certain amounts may be
contributed to an IRA which will be deductible from the individual's gross
income. These IRAs are subject to limitations on eligibility,
contributions, transferability and distributions. Sales of contracts for
use with IRAs are subject to special requirements imposed by the Code,
including the requirement that certain informational disclosure be given to
persons desiring to establish an IRA.
(D) Roth IRAs
Section 408(a) of the Code permits an individual to contribute to an
individual retirement program called a Roth IRA. Unlike contributions to a
regular IRA under Section 408(b) of the Code, contributions to a Roth IRA
are not made on a tax-deferred basis, but distributions are tax-free if
certain requirements are satisfied. Like regular IRAs, Roth IRAs are
subject to limitations on the amount
-16-
<PAGE> 23
that may be contributed, those who may be eligible and the time when
distributions may commence without tax penalty. Certain persons may be
eligible to convert a regular IRA into a Roth IRA, and the taxes on the
resulting income may be spread over four years if the conversion occurs
before January 1, 1999. If and when contracts are made available for use
with Roth IRAs, they may be subject to special requirements imposed by the
Internal Revenue Service ("IRS"). Purchasers of the contracts for this
purpose will be provided with such supplementary information as may be
required by the IRS or other appropriate agency.
(E) Corporate Pension and Profit-Sharing Plans
Section 401(a) and 401(k) of the Code permit corporate employers to
establish various types of retirement plans for employees. These retirement
plans may permit the purchase of the contracts to provide benefits under
the plan. Contributions to the plan for the benefit of employees will not
be includible in the gross income of the employee until distributed from
the plan. The tax consequences to owners may vary depending upon the
particular plan design. However, the Code places limitations on all plans
on such items as amount of allowable contributions; form, manner and timing
of distributions; vesting and nonforfeitability of interest;
nondiscrimination in eligibility and participation; and the tax treatment
of distributions, withdrawals and surrenders.
(F) Deferred Compensation Plans - Section 457
Under Section 457 of the Code, governmental and certain other
tax-exempt employers may establish, for the benefit of their employees,
deferred compensation plans which may invest in annuity contracts. The
Code, as in the case of Qualified plans, establishes limitations and
restrictions on eligibility, contributions and distributions. Under these
plans, contributions made for the benefit of the employees will not be
includible in the employees' gross income until distributed from the plan.
However, under a 457 plan all the plan assets shall remain solely the
property of the employer, subject only to the claims of the employer's
general creditors until such time as made available to an owner or a
Beneficiary. As of January 1, 1999, all 457 plans of state and local
governments must hold assets and income in trust (or custodial accounts or
an annuity contract) for the exclusive benefit of participants and their
Beneficiaries.
- --------------------------------------------------------------------------------
DISTRIBUTION OF CONTRACTS
- --------------------------------------------------------------------------------
The contracts are offered on a continuous basis through the distributor for
the separate account, SunAmerica Capital Services, Inc., located at 733 Third
Avenue, 4th Floor, New York, New York 10017. SunAmerica Capital Services, Inc.
is registered as a broker-dealer under the Securities Exchange Act of 1934, as
amended, and is a member of
-17-
<PAGE> 24
the National Association of Securities Dealers, Inc. The Company and SunAmerica
Capital Services, Inc. are each an indirect wholly owned subsidiary of
SunAmerica Inc. No underwriting fees are paid in connection with the
distribution of the contracts.
- --------------------------------------------------------------------------------
FINANCIAL STATEMENTS
- --------------------------------------------------------------------------------
The audited financial statements of the Company as of September 30, 1998
and 1997 and for each of the three years in the period ended September 30, 1998
are incorporated herein by reference to Post-Effective Amendment No. 11 under
the Securities Act of 1933 (the 33 Act) and No. 13 under the Investment Company
Act of 1940 (the 40 Act) to this Registration Statement file No. 33-85014 and
811-8810 filed on form N-4 on December 6, 1999. Effective December 31, 1999, the
Company changed its fiscal year end from September 30 to December 31. Reflecting
this change, also incorporated herein by reference to the above stated
Registration Statement is the audited Transition Report of the Company as of and
for the three month period ended December 31, 1998. The financial statements of
the Company should be considered only as bearing on the ability of the Company
to meet its obligation under the contracts for amounts allocated to the 1, 3, 5,
7 or 10 year fixed account options and the DCA fixed accounts for 6-month and
1-year periods.
Effective December 31, 1999, FS Variable Separate Account changed its
fiscal year end from November 30 to December 31. Reflecting this change,
included in this Statement of Additional Information are the FS Variable
Separate Account audited financial statements as of and for the one month period
ended December 31, 1999 and as of November 30, 1999 and for each of the two
fiscal years in the period ended November 30, 1999.
Documents incorporated by reference for filing purposes will still appear
at the end of this document when it is distributed upon request.
PricewaterhouseCoopers LLP, 400 South Hope Street, Los Angeles, California
90071, serves as the independent accountants for the separate account and the
Company. The financial statements referred to above have been so included in
reliance on the reports of PricewaterhouseCoopers LLP, independent accountants,
given on the authority of said firm as experts in auditing and accounting.
-18-
<PAGE> 25
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
FINANCIAL STATEMENTS
DECEMBER 31, 1999 AND NOVEMBER 30, 1999
<PAGE> 26
REPORT OF INDEPENDENT ACCOUNTANTS
To the Board of Directors of First SunAmerica Life Insurance Company and the
Contractholders of its separate account, FS Variable Separate Account
In our opinion, the accompanying statement of net assets, including the schedule
of portfolio investments, and the related statements of operations and of
changes in net assets present fairly, in all material respects, the financial
position of the Variable Account constituting FS Variable Separate Account, a
separate account of First SunAmerica Life Insurance Company (the "Separate
Account") at December 31, 1999 and November 30, 1999, the results of their
operations for the one month ended December 31, 1999 and for the fiscal year
ended November 30, 1999, and the changes in their net assets for the one month
ended December 31, 1999 and for the two fiscal years ended November 30, 1999 and
1998, in conformity with accounting principles generally accepted in the United
States. These financial statements are the responsibility of the Separate
Account's management; our responsibility is to express an opinion on these
financial statements based on our audits. We conducted our audits of these
financial statements in accordance with auditing standards generally accepted in
the United States, which require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements, assessing the
accounting principles used and significant estimates made by management, and
evaluating the overall financial statement presentation. We believe that our
audits, which included confirmation of securities owned at December 31, 1999 and
November 30, 1999 by correspondence with the custodian, provide a reasonable
basis for the opinion expressed above.
PricewaterhouseCoopers, LLP
Los Angeles, California
March 3, 2000
<PAGE> 27
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
Government International
Capital Natural and Diversified Global Aggressive
Appreciation Growth Resources Quality Bond Equities Equities Growth
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ----------- ---------- ------------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in Anchor Series
Trust, at market value $43,525,781 $17,759,531 $1,874,071 $11,220,079 $ 0 $ 0 $ 0
Investments in SunAmerica Series
Trust, at market value 0 0 0 0 15,320,573 12,867,520 21,086,292
Liabilities 0 0 0 0 0 0 0
----------- ----------- ---------- ----------- ----------- ----------- -----------
Net Assets $43,525,781 $17,759,531 $1,874,071 $11,220,079 $15,320,573 $12,867,520 $21,086,292
=========== =========== ========== =========== =========== =========== ===========
Accumulation units outstanding 1,008,089 544,578 149,945 844,907 905,352 484,217 867,740
=========== =========== ========== =========== =========== =========== ===========
Unit value of accumulation units $ 43.17 $ 32.61 $ 12.50 $ 13.28 $ 16.92 $ 26.57 $ 24.30
=========== =========== ========== =========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 28
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
MFS
Venture Federated Putnam Growth & Alliance Growth- Asset
Value Value Growth Income Growth Income Allocation
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ---------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in Anchor Series
Trust, at market value $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Investments in SunAmerica Series
Trust, at market value 66,104,260 9,501,613 27,574,234 10,538,383 97,332,209 62,282,825 20,805,498
Liabilities 0 0 0 0 0 0 0
----------- ---------- ----------- ----------- ----------- ----------- -----------
Net Assets $66,104,260 $9,501,613 $27,574,234 $10,538,383 $97,332,209 $62,282,825 $20,805,498
=========== ========== =========== =========== =========== =========== ===========
Accumulation units outstanding 2,370,974 562,638 870,842 445,395 2,004,501 1,734,522 1,050,186
=========== ========== =========== =========== =========== =========== ===========
Unit value of accumulation units $ 27.88 $ 16.89 $ 31.67 $ 23.67 $ 48.56 $ 35.91 $ 19.81
=========== ========== =========== =========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 29
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
SunAmerica MFS Worldwide High-Yield Global Corporate
Balanced Total Return Utility High Income Bond Bond Bond
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ------------ ---------- ----------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in Anchor Series
Trust, at market value $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Investments in SunAmerica Series
Trust, at market value 21,004,433 9,116,380 4,956,980 7,417,879 17,443,289 4,805,810 5,674,826
Liabilities 0 0 0 0 0 0 0
----------- ---------- ---------- ---------- ----------- ---------- ----------
Net Assets $21,004,433 $9,116,380 $4,956,980 $7,417,879 $17,443,289 $4,805,810 $5,674,826
=========== ========== ========== ========== =========== ========== ==========
Accumulation units outstanding 1,067,349 490,051 328,240 472,561 1,172,818 341,155 451,341
=========== ========== ========== ========== =========== ========== ==========
Unit value of accumulation units $ 19.69 $ 18.60 $ 15.11 $ 15.70 $ 14.87 $ 14.09 $ 12.76
=========== ========== ========== ========== =========== ========== ==========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 30
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
International "Dogs" MFS
Growth & Emerging Real of Wall Mid-Cap Cash
Income Markets Estate Street Growth Management
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio TOTAL
---------- ---------- ---------- -------- ---------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in Anchor Series
Trust, at market value $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 74,379,462
Investments in SunAmerica Series
Trust, at market value 7,209,207 3,730,983 1,302,837 210,960 1,447,344 12,566,016 440,300,351
Liabilities 0 0 0 0 0 0 0
---------- ---------- ---------- -------- ---------- ----------- ------------
Net Assets $7,209,207 $3,730,983 $1,302,837 $210,960 $1,447,344 $12,566,016 $514,679,813
========== ========== ========== ======== ========== =========== ============
Accumulation units outstanding 512,671 346,205 146,237 23,471 88,761 1,022,344
========== ========== ========== ======== ========== ===========
Unit value of accumulation units $ 14.07 $ 10.77 $ 8.91 $ 8.99 $ 16.31 $ 12.25
========== ========== ========== ======== ========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 31
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS
NOVEMBER 30, 1999
<TABLE>
<CAPTION>
Government International
Capital Natural and Diversified Global Aggressive
Appreciation Growth Resources Quality Bond Equities Equities Growth
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ----------- ---------- ------------ ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in Anchor Series
Trust, at market value $35,652,332 $16,151,495 $1,659,358 $10,939,968 $ 0 $ 0 $ 0
Investments in SunAmerica Series
Trust, at market value 0 0 0 0 14,267,667 11,170,312 15,316,811
Liabilities 0 0 0 0 0 0 0
----------- ----------- ---------- ----------- ----------- ----------- -----------
Net Assets $35,652,332 $16,151,495 $1,659,358 $10,939,968 $14,267,667 $11,170,312 $15,316,811
=========== =========== ========== =========== =========== =========== ===========
Accumulation units outstanding 979,651 543,129 145,614 817,993 921,115 461,621 805,328
=========== =========== ========== =========== =========== =========== ===========
Unit value of accumulation units $ 36.39 $ 29.74 $ 11.40 $ 13.37 $ 15.49 $ 24.20 $ 19.02
=========== =========== ========== =========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 32
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
MFS
Venture Federated Putnam Growth & Alliance Growth- Asset
Value Value Growth Income Growth Income Allocation
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ---------- ----------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in Anchor Series
Trust, at market value $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Investments in SunAmerica Series
Trust, at market value 62,795,720 9,125,265 23,476,467 9,704,314 84,270,036 55,594,028 19,895,410
Liabilities 0 0 0 0 0 0 0
----------- ---------- ----------- ---------- ----------- ----------- -----------
Net Assets $62,795,720 $9,125,265 $23,476,467 $9,704,314 $84,270,036 $55,594,028 $19,895,410
=========== ========== =========== ========== =========== =========== ===========
Accumulation units outstanding 2,363,904 555,385 828,070 430,432 1,901,945 1,679,055 1,041,762
=========== ========== =========== ========== =========== =========== ===========
Unit value of accumulation units $ 26.57 $ 16.43 $ 28.36 $ 22.55 $ 44.31 $ 33.11 $ 19.10
=========== ========== =========== ========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 33
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
MFS
SunAmerica Total Worldwide High-Yield Global Corporate
Balanced Return Utility High Income Bond Bond Bond
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ---------- ---------- ----------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in Anchor Series
Trust, at market value $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 0
Investments in SunAmerica Series
Trust, at market value 18,282,476 8,592,381 4,674,319 7,281,716 14,804,931 4,682,824 5,582,199
Liabilities 0 0 0 0 0 0 0
----------- ---------- ---------- ---------- ----------- ---------- ----------
Net Assets $18,282,476 $8,592,381 $4,674,319 $7,281,716 $14,804,931 $4,682,824 $5,582,199
=========== ========== ========== ========== =========== ========== ==========
Accumulation units outstanding 1,003,514 464,535 308,375 478,116 1,006,610 331,825 443,122
=========== ========== ========== ========== =========== ========== ==========
Unit value of accumulation units $ 18.23 $ 18.50 $ 15.16 $ 15.23 $ 14.71 $ 14.11 $ 12.78
=========== ========== ========== ========== =========== ========== ==========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 34
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF NET ASSETS
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
International "Dogs" MFS
Growth & Emerging Real of Wall Mid-Cap Cash
Income Markets Estate Street Growth Management
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio TOTAL
---------- ---------- ---------- --------- --------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Assets:
Investments in Anchor Series
Trust, at market value $ 0 $ 0 $ 0 $ 0 $ 0 $ 0 $ 64,403,153
Investments in SunAmerica Series
Trust, at market value 6,362,057 2,919,924 1,193,513 72,578 927,604 12,282,449 393,275,001
Liabilities 0 0 0 0 0 0 0
---------- ---------- ---------- ------- -------- ----------- ------------
Net Assets $6,362,057 $2,919,924 $1,193,513 $72,578 $927,604 $12,282,449 $457,678,154
========== ========== ========== ======= ======== =========== ============
Accumulation units outstanding 475,183 324,647 140,396 7,956 65,176 1,003,095
========== ========== ========== ======= ======== ===========
Unit value of accumulation units $ 13.40 $ 8.99 $ 8.50 $ 9.12 $ 14.23 $ 12.20
========== ========== ========== ======= ======== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 35
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
SCHEDULE OF PORTFOLIO INVESTMENTS
DECEMBER 31, 1999
<TABLE>
<CAPTION>
Market Value Market
Variable Accounts Shares Per Share Value Cost
- ----------------- --------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
ANCHOR SERIES TRUST:
Capital Appreciation Portfolio 763,284 $ 57.02 $ 43,525,781 $ 26,021,574
Growth Portfolio 461,058 38.52 17,759,531 13,729,050
Natural Resources Portfolio 115,505 16.22 1,874,071 1,769,039
Government and Quality Bond Portfolio 819,965 13.68 11,220,079 11,727,197
------------ ------------
74,379,462 53,246,860
------------ ------------
SUNAMERICA SERIES TRUST:
International Diversified Equities Portfolio 957,673 16.00 15,320,573 11,492,916
Global Equities Portfolio 590,580 21.79 12,867,520 9,991,580
Aggressive Growth Portfolio 902,727 23.36 21,086,292 12,004,845
Venture Value Portfolio 2,467,229 26.79 66,104,260 49,884,512
Federated Value Portfolio 573,389 16.57 9,501,613 8,408,914
Putnam Growth Portfolio 978,287 28.19 27,574,234 20,415,441
MFS Growth & Income Portfolio 754,643 13.96 10,538,383 10,668,207
Alliance Growth Portfolio 2,536,640 38.37 97,332,209 70,097,402
Growth-Income Portfolio 1,912,095 32.57 62,282,825 45,556,942
Asset Allocation Portfolio 1,387,879 14.99 20,805,498 20,558,920
SunAmerica Balanced Portfolio 1,069,326 19.64 21,004,433 16,951,254
MFS Total Return Portfolio 637,081 14.31 9,116,380 9,044,161
Utility Portfolio 344,728 14.38 4,956,980 4,805,210
Worldwide High Income Portfolio 697,188 10.64 7,417,879 7,680,624
High-Yield Bond Portfolio 1,663,657 10.48 17,443,289 18,177,152
Global Bond Portfolio 444,448 10.81 4,805,810 4,983,438
Corporate Bond Portfolio 510,161 11.12 5,674,826 5,841,927
International Growth & Income Portfolio 559,093 12.89 7,209,207 6,931,633
Emerging Markets Portfolio 336,556 11.09 3,730,983 2,828,368
Real Estate Portfolio 147,845 8.81 1,302,837 1,513,557
"Dogs" of Wall Street Portfolio 23,554 8.96 210,960 214,184
MFS Mid-Cap Growth Portfolio 89,038 16.26 1,447,344 1,285,198
Cash Management Portfolio 1,154,303 10.89 12,566,016 12,468,030
------------ ------------
440,300,351 351,804,415
------------ ------------
$514,679,813 $405,051,275
============ ============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 36
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
SCHEDULE OF PORTFOLIO INVESTMENTS
NOVEMBER 30, 1999
<TABLE>
<CAPTION>
Market Value Market
Variable Accounts Shares Per Share Value Cost
- ----------------- --------- ------------ ------------ ------------
<S> <C> <C> <C> <C>
ANCHOR SERIES TRUST:
Capital Appreciation Portfolio 742,712 $ 48.00 $ 35,652,332 $ 24,806,625
Growth Portfolio 460,426 35.08 16,151,495 13,600,364
Natural Resources Portfolio 112,314 14.77 1,659,358 1,717,717
Government and Quality Bond Portfolio 794,871 13.76 10,939,968 11,402,947
------------ ------------
64,403,153 51,527,653
------------ ------------
SUNAMERICA SERIES TRUST:
International Diversified Equities Portfolio 975,606 14.62 14,267,667 11,641,600
Global Equities Portfolio 563,751 19.81 11,170,312 9,406,104
Aggressive Growth Portfolio 838,884 18.26 15,316,811 10,638,753
Venture Value Portfolio 2,463,047 25.50 62,795,720 49,597,967
Federated Value Portfolio 566,729 16.10 9,125,265 8,293,395
Putnam Growth Portfolio 931,436 25.20 23,476,467 19,147,630
MFS Growth & Income Portfolio 730,220 13.29 9,704,314 10,338,694
Alliance Growth Portfolio 2,409,968 34.97 84,270,036 65,415,601
Growth-Income Portfolio 1,853,337 30.00 55,594,028 43,638,894
Asset Allocation Portfolio 1,378,526 14.43 19,895,410 20,417,823
SunAmerica Balanced Portfolio 1,006,634 18.16 18,282,476 15,743,183
MFS Total Return Portfolio 604,689 14.21 8,592,381 8,583,136
Utility Portfolio 324,280 14.41 4,674,319 4,514,394
Worldwide High Income Portfolio 706,301 10.31 7,281,716 7,794,239
High-Yield Bond Portfolio 1,429,797 10.35 14,804,931 15,744,534
Global Bond Portfolio 432,849 10.82 4,682,824 4,861,199
Corporate Bond Portfolio 501,380 11.13 5,582,199 5,745,523
International Growth & Income Portfolio 472,372 13.47 6,362,057 5,771,770
Emerging Markets Portfolio 316,007 9.24 2,919,924 2,610,698
Real Estate Portfolio 142,123 8.40 1,193,513 1,467,050
"Dogs" of Wall Street Portfolio 7,994 9.08 72,578 75,333
MFS Mid-Cap Growth Portfolio 64,531 14.37 927,604 903,918
Cash Management Portfolio 1,134,061 10.83 12,282,449 12,225,009
------------ ------------
393,275,001 334,576,447
------------ ------------
$457,678,154 $386,104,100
============ ============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 37
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS
FOR THE ONE MONTH ENDED
DECEMBER 31, 1999
<TABLE>
<CAPTION>
Government International
Capital Natural and Diversified Global Aggressive
Appreciation Growth Resources Quality Bond Equities Equities Growth
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ---------- -------- --------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and capital
gains distributions $ -- $ -- $ -- $ -- $ -- $ -- $ --
----------- ---------- -------- --------- ---------- ---------- ----------
Total investment income 0 0 0 0 0 0 0
----------- ---------- -------- --------- ---------- ---------- ----------
Expenses:
Mortality risk charge (30,332) (13,008) (1,311) (8,228) (11,165) (9,042) (14,206)
Guarantee death benefit charge (4,044) (1,734) (175) (1,097) (1,489) (1,206) (1,894)
Expense risk charge (11,796) (5,059) (510) (3,200) (4,342) (3,516) (5,524)
Distribution expense charge (5,056) (2,168) (218) (1,372) (1,860) (1,507) (2,368)
----------- ---------- -------- --------- ---------- ---------- ----------
Total expenses (51,228) (21,969) (2,214) (13,897) (18,856) (15,271) (23,992)
----------- ---------- -------- --------- ---------- ---------- ----------
Net investment income (loss) (51,228) (21,969) (2,214) (13,897) (18,856) (15,271) (23,992)
----------- ---------- -------- --------- ---------- ---------- ----------
Net realized gains (losses)
from securities transactions:
Proceeds from shares sold 338,756 507,979 22,795 429,387 591,582 171,196 80,862
Cost of shares sold (212,371) (408,407) (23,402) (448,192) (471,781) (143,729) (46,442)
----------- ---------- -------- --------- ---------- ---------- ----------
Net realized gains (losses) from
securities transactions 126,385 99,572 (607) (18,805) 119,801 27,467 34,420
----------- ---------- -------- --------- ---------- ---------- ----------
Net unrealized appreciation
(depreciation) of investments:
Beginning of period 10,845,707 2,551,131 (58,359) (462,979) 2,626,067 1,764,208 4,678,058
End of period 17,504,207 4,030,481 105,032 (507,118) 3,827,657 2,875,940 9,081,447
----------- ---------- -------- --------- ---------- ---------- ----------
Change in net unrealized
appreciation/depreciation
of investments 6,658,500 1,479,350 163,391 (44,139) 1,201,590 1,111,732 4,403,389
----------- ---------- -------- --------- ---------- ---------- ----------
Increase (decrease) in net
assets from operations $ 6,733,657 $1,556,953 $160,570 $ (76,841) $1,302,535 $1,123,928 $4,413,817
=========== ========== ======== ========= ========== ========== ==========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 38
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS
FOR THE ONE MONTH ENDED
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
MFS
Venture Federated Putnam Growth & Alliance Growth- Asset
Value Value Growth Income Growth Income Allocation
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ---------- ---------- --------- ----------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and capital
gains distributions $ -- $ -- $ -- $ -- $ -- $ -- $ --
----------- ---------- ---------- --------- ----------- ----------- ---------
Total investment income 0 0 0 0 0 0 0
----------- ---------- ---------- --------- ----------- ----------- ---------
Expenses:
Mortality risk charge (48,712) (6,997) (19,323) (7,665) (69,065) (44,852) (15,444)
Guarantee death benefit charge (6,495) (933) (2,576) (1,022) (9,209) (5,980) (2,059)
Expense risk charge (18,944) (2,721) (7,515) (2,981) (26,859) (17,442) (6,006)
Distribution expense charge (8,118) (1,166) (3,221) (1,278) (11,510) (7,476) (2,574)
----------- ---------- ---------- --------- ----------- ----------- ---------
Total expenses (82,269) (11,817) (32,635) (12,946) (116,643) (75,750) (26,083)
----------- ---------- ---------- --------- ----------- ----------- ---------
Net investment income (loss) (82,269) (11,817) (32,635) (12,946) (116,643) (75,750) (26,083)
----------- ---------- ---------- --------- ----------- ----------- ---------
Net realized gains (losses) from
securities transactions:
Proceeds from shares sold 747,968 69,584 6,562 78,624 264,332 339,865 206,195
Cost of shares sold (582,399) (63,389) (5,077) (82,391) (198,529) (259,255) (208,946)
----------- ---------- ---------- --------- ----------- ----------- ---------
Net realized gains (losses) from
securities transactions 165,569 6,195 1,485 (3,767) 65,803 80,610 (2,751)
----------- ---------- ---------- --------- ----------- ----------- ---------
Net unrealized appreciation
(depreciation) of investments:
Beginning of period 13,197,753 831,870 4,328,837 (634,380) 18,854,435 11,955,134 (522,413)
End of period 16,219,748 1,092,699 7,158,793 (129,824) 27,234,807 16,725,883 246,578
----------- ---------- ---------- --------- ----------- ----------- ---------
Change in net unrealized
appreciation/depreciation
of investments 3,021,995 260,829 2,829,956 504,556 8,380,372 4,770,749 768,991
----------- ---------- ---------- --------- ----------- ----------- ---------
Increase (decrease) in net
assets from operations $ 3,105,295 $ 255,207 $2,798,806 $ 487,843 $ 8,329,532 $ 4,775,609 $ 740,157
=========== ========== ========== ========= =========== =========== =========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 39
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS
FOR THE ONE MONTH ENDED
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
SunAmerica MFS Total Worldwide High-Yield Global Corporate
Balanced Return Utility High Income Bond Bond Bond
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- -------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and capital
gains distributions $ -- $ -- $ -- $ -- $ -- $ -- $ --
----------- -------- --------- --------- --------- --------- ---------
Total investment income 0 0 0 0 0 0 0
----------- -------- --------- --------- --------- --------- ---------
Expenses:
Mortality risk charge (14,964) (6,712) (3,625) (5,591) (12,699) (3,567) (4,265)
Guarantee death benefit charge (1,995) (895) (483) (745) (1,693) (476) (569)
Expense risk charge (5,819) (2,610) (1,410) (2,174) (4,938) (1,387) (1,659)
Distribution expense charge (2,494) (1,118) (605) (932) (2,117) (594) (710)
----------- -------- --------- --------- --------- --------- ---------
Total expenses (25,272) (11,335) (6,123) (9,442) (21,447) (6,024) (7,203)
----------- -------- --------- --------- --------- --------- ---------
Net investment income (loss) (25,272) (11,335) (6,123) (9,442) (21,447) (6,024) (7,203)
----------- -------- --------- --------- --------- --------- ---------
Net realized gains (losses) from
securities transactions:
Proceeds from shares sold 64,330 50,745 14,974 382,386 117,213 89,681 49,143
Cost of shares sold (54,270) (51,022) (14,680) (401,044) (122,814) (93,039) (50,501)
----------- -------- --------- --------- --------- --------- ---------
Net realized gains (losses) from
securities transactions 10,060 (277) 294 (18,658) (5,601) (3,358) (1,358)
----------- -------- --------- --------- --------- --------- ---------
Net unrealized appreciation
(depreciation) of investments:
Beginning of period 2,539,293 9,245 159,925 (512,523) (939,603) (178,375) (163,324)
End of period 4,053,179 72,219 151,770 (262,745) (733,863) (177,628) (167,101)
----------- -------- --------- --------- --------- --------- ---------
Change in net unrealized
appreciation/depreciation
of investments 1,513,886 62,974 (8,155) 249,778 205,740 747 (3,777)
----------- -------- --------- --------- --------- --------- ---------
Increase (decrease) in net
assets from operations $ 1,498,674 $ 51,362 $ (13,984) $ 221,678 $ 178,692 $ (8,635) $ (12,338)
=========== ======== ========= ========= ========= ========= =========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 40
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS
FOR THE ONE MONTH ENDED
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
International "Dogs" MFS
Growth & Emerging Real of Wall Mid-Cap Cash
Income Markets Estate Street Growth Management
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio TOTAL
--------- --------- --------- --------- --------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and capital
gains distributions $ 635,245 $ -- $ -- $ -- $ 18,924 $ -- $ 654,169
--------- --------- --------- ------- --------- ----------- -------------
Total investment income 635,245 0 0 0 18,924 0 654,169
--------- --------- --------- ------- --------- ----------- -------------
Expenses:
Mortality risk charge (5,179) (2,540) (923) (120) (872) (8,814) (369,221)
Guarantee death benefit charge (691) (339) (123) (16) (116) (1,175) (49,229)
Expense risk charge (2,014) (988) (359) (47) (339) (3,428) (143,587)
Distribution expense charge (863) (423) (153) (20) (146) (1,469) (61,536)
--------- --------- --------- ------- --------- ----------- -------------
Total expenses (8,747) (4,290) (1,558) (203) (1,473) (14,886) (623,573)
--------- --------- --------- ------- --------- ----------- -------------
Net investment income (loss) 626,498 (4,290) (1,558) (203) 17,451 (14,886) 30,596
--------- --------- --------- ------- --------- ----------- -------------
Net realized gains (losses) from
securities transactions:
Proceeds from shares sold 93,039 51,845 13,322 2,333 65,306 2,953,476 7,803,480
Cost of shares sold (81,466) (41,171) (16,558) (2,441) (58,227) (2,934,356) (7,075,899)
--------- --------- --------- ------- --------- ----------- -------------
Net realized gains (losses) from
securities transactions 11,573 10,674 (3,236) (108) 7,079 19,120 727,581
--------- --------- --------- ------- --------- ----------- -------------
Net unrealized appreciation
(depreciation) of investments:
Beginning of period 590,287 309,226 (273,537) (2,755) 23,686 57,440 71,574,054
End of period 277,574 902,615 (210,720) (3,224) 162,146 97,986 109,628,538
--------- --------- --------- ------- --------- ----------- -------------
Change in net unrealized
appreciation/depreciation
of investments (312,713) 593,389 62,817 (469) 138,460 40,546 38,054,484
--------- --------- --------- ------- --------- ----------- -------------
Increase (decrease) in net
assets from operations $ 325,358 $ 599,773 $ 58,023 $ (780) $ 162,990 $ 44,780 $ 38,812,661
========= ========= ========= ======= ========= =========== =============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 41
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED
NOVEMBER 30, 1999
<TABLE>
<CAPTION>
Government International
Capital Natural and Diversified Global Aggressive
Appreciation Growth Resources Quality Bond Equities Equities Growth
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ---------- --------- ------------ ------------- ----------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and capital
gains distributions $ 1,361,110 $ 925,021 $ 20,151 $ 665,054 $ 272,136 $ 727,643 $ 943,475
----------- ---------- --------- ----------- ----------- ----------- ----------
Total investment income 1,361,110 925,021 20,151 665,054 272,136 727,643 943,475
----------- ---------- --------- ----------- ----------- ----------- ----------
Expenses:
Mortality risk charge (232,308) (112,617) (12,167) (93,149) (116,757) (79,858) (95,114)
Guarantee death benefit charge (30,974) (15,016) (1,622) (12,420) (15,568) (10,648) (12,682)
Expense risk charge (90,342) (43,795) (4,731) (36,225) (45,406) (31,056) (36,989)
Distribution expense charge (38,718) (18,769) (2,028) (15,525) (19,459) (13,309) (15,852)
----------- ---------- --------- ----------- ----------- ----------- ----------
Total expenses (392,342) (190,197) (20,548) (157,319) (197,190) (134,871) (160,637)
----------- ---------- --------- ----------- ----------- ----------- ----------
Net investment income (loss) 968,768 734,824 (397) 507,735 74,946 592,772 782,838
----------- ---------- --------- ----------- ----------- ----------- ----------
Net realized gains (losses) from
securities transactions:
Proceeds from shares sold 2,361,829 1,012,160 430,778 5,333,553 3,036,315 2,303,417 1,300,534
Cost of shares sold (1,847,985) (827,698) (469,100) (5,450,893) (2,613,222) (1,997,147) (977,344)
----------- ---------- --------- ----------- ----------- ----------- ----------
Net realized gains (losses) from
securities transactions 513,844 184,462 (38,322) (117,340) 423,093 306,270 323,190
----------- ---------- --------- ----------- ----------- ----------- ----------
Net unrealized appreciation
(depreciation) of investments:
Beginning of period 1,147,845 1,078,339 (311,716) 103,019 1,321,865 555,769 838,530
End of period 10,845,707 2,551,131 (58,359) (462,979) 2,626,067 1,764,208 4,678,058
----------- ---------- --------- ----------- ----------- ----------- ----------
Change in net unrealized
appreciation/depreciation
of investments 9,697,862 1,472,792 253,357 (565,998) 1,304,202 1,208,439 3,839,528
----------- ---------- --------- ----------- ----------- ----------- ----------
Increase (decrease) in net
assets from operations $11,180,474 $2,392,078 $ 214,638 $ (175,603) $ 1,802,241 $ 2,107,481 $4,945,556
=========== ========== ========= =========== =========== =========== ==========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 42
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
MFS
Venture Federated Putnam Growth & Alliance Growth- Asset
Value Value Growth Income Growth Income Allocation
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ---------- ---------- ---------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and capital
gains distributions $ 2,566,047 $ 414,656 $ 555,412 $1,445,235 $ 5,619,959 $ 2,197,259 $ 1,579,607
----------- ---------- ---------- ---------- ----------- ----------- -----------
Total investment income 2,566,047 414,656 555,412 1,445,235 5,619,959 2,197,259 1,579,607
----------- ---------- ---------- ---------- ----------- ----------- -----------
Expenses:
Mortality risk charge (520,153) (76,078) (142,147) (55,023) (541,352) (353,952) (172,385)
Guarantee death benefit charge (69,354) (10,144) (18,953) (7,336) (72,180) (47,194) (22,985)
Expense risk charge (202,282) (29,586) (55,279) (21,398) (210,526) (137,648) (67,039)
Distribution expense charge (86,692) (12,679) (23,691) (9,171) (90,226) (58,991) (28,730)
----------- ---------- ---------- ---------- ----------- ----------- -----------
Total expenses (878,481) (128,487) (240,070) (92,928) (914,284) (597,785) (291,139)
----------- ---------- ---------- ---------- ----------- ----------- -----------
Net investment income (loss) 1,687,566 286,169 315,342 1,352,307 4,705,675 1,599,474 1,288,468
----------- ---------- ---------- ---------- ----------- ----------- -----------
Net realized gains (losses) from
securities transactions:
Proceeds from shares sold 3,149,130 670,651 896,675 606,129 2,979,571 1,893,475 3,305,010
Cost of shares sold (2,414,922) (567,891) (741,126) (564,241) (2,105,975) (1,424,088) (3,266,504)
----------- ---------- ---------- ---------- ----------- ----------- -----------
Net realized gains (losses) from
securities transactions 734,208 102,760 155,549 41,888 873,596 469,387 38,506
----------- ---------- ---------- ---------- ----------- ----------- -----------
Net unrealized appreciation
(depreciation) of investments:
Beginning of period 8,621,139 1,002,718 1,068,426 329,241 8,212,508 4,901,864 (114,863)
End of period 13,197,753 831,870 4,328,837 (634,380) 18,854,435 11,955,134 (522,413)
----------- ---------- ---------- ---------- ----------- ----------- -----------
Change in net unrealized
appreciation/depreciation
of investments 4,576,614 (170,848) 3,260,411 (963,621) 10,641,927 7,053,270 (407,550)
----------- ---------- ---------- ---------- ----------- ----------- -----------
Increase (decrease) in net
assets from operations $ 6,998,388 $ 218,081 $3,731,302 $ 430,574 $16,221,198 $ 9,122,131 $ 919,424
=========== ========== ========== ========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 43
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
SunAmerica MFS Total Worldwide High-Yield Global Corporate
Balanced Return Utility High Income Bond Bond Bond
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- --------- --------- ----------- ------------ --------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and capital
gains distributions $ 230,302 $ 892,007 $ 242,631 $ 712,440 $ 1,271,674 $ 313,271 $ 223,447
----------- --------- --------- ----------- ------------ --------- -----------
Total investment income 230,302 892,007 242,631 712,440 1,271,674 313,271 223,447
----------- --------- --------- ----------- ------------ --------- -----------
Expenses:
Mortality risk charge (103,094) (58,472) (36,758) (58,099) (132,668) (36,630) (43,523)
Guarantee death benefit charge (13,746) (7,796) (4,901) (7,747) (17,689) (4,884) (5,803)
Expense risk charge (40,092) (22,739) (14,295) (22,594) (51,593) (14,245) (16,925)
Distribution expense charge (17,183) (9,746) (6,127) (9,683) (22,112) (6,105) (7,254)
----------- --------- --------- ----------- ------------ --------- -----------
Total expenses (174,115) (98,753) (62,081) (98,123) (224,062) (61,864) (73,505)
----------- --------- --------- ----------- ------------ --------- -----------
Net investment income (loss) 56,187 793,254 180,550 614,317 1,047,612 251,407 149,942
----------- --------- --------- ----------- ------------ --------- -----------
Net realized gains (losses) from
securities transactions:
Proceeds from shares sold 1,078,827 277,324 348,400 4,411,112 11,170,218 575,408 1,144,658
Cost of shares sold (885,539) (252,430) (274,976) (4,885,337) (11,089,848) (566,196) (1,122,447)
----------- --------- --------- ----------- ------------ --------- -----------
Net realized gains (losses) from
securities transactions 193,288 24,894 73,424 (474,225) 80,370 9,212 22,211
----------- --------- --------- ----------- ------------ --------- -----------
Net unrealized appreciation
(depreciation) of investments:
Beginning of period 1,082,614 507,835 255,279 (1,087,572) (349,291) 160,688 136,527
End of period 2,539,293 9,245 159,925 (512,523) (939,603) (178,375) (163,324)
----------- --------- --------- ----------- ------------ --------- -----------
Change in net unrealized
appreciation/depreciation
of investments 1,456,679 (498,590) (95,354) 575,049 (590,312) (339,063) (299,851)
----------- --------- --------- ----------- ------------ --------- -----------
Increase (decrease) in net
assets from operations $ 1,706,154 $ 319,558 $ 158,620 $ 715,141 $ 537,670 $ (78,444) $ (127,698)
=========== ========= ========= =========== ============ ========= ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 44
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF OPERATIONS
FOR THE YEAR ENDED
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
International "Dogs" MFS
Growth & Emerging Real Wall of Mid-Cap Cash
Income Markets Estate Street Growth Management
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio TOTAL
----------- --------- --------- ------- -------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
Investment income:
Dividends and capital
gains distributions $ 96,981 $ 2,427 $ 43,105 $ -- $ -- $ 306,812 $ 23,627,862
----------- --------- --------- ------- -------- ------------ ------------
Total investment income 96,981 2,427 43,105 0 0 306,812 23,627,862
----------- --------- --------- ------- -------- ------------ ------------
Expenses:
Mortality risk charge (42,477) (14,808) (11,521) (33) (275) (88,977) (3,230,395)
Guarantee death benefit charge (5,664) (1,974) (1,536) (4) (37) (11,864) (430,721)
Expense risk charge (16,519) (5,759) (4,480) (13) (107) (34,602) (1,256,265)
Distribution expense charge (7,079) (2,468) (1,920) (5) (45) (14,830) (538,397)
----------- --------- --------- ------- -------- ------------ ------------
Total expenses (71,739) (25,009) (19,457) (55) (464) (150,273) (5,455,778)
----------- --------- --------- ------- -------- ------------ ------------
Net investment income (loss) 25,242 (22,582) 23,648 (55) (464) 156,539 18,172,084
----------- --------- --------- ------- -------- ------------ ------------
Net realized gains (losses) from
securities transactions:
Proceeds from shares sold 1,935,185 520,369 688,941 5,780 146 23,698,036 75,133,631
Cost of shares sold (1,787,758) (522,787) (739,839) (5,937) (136) (23,529,326) (70,930,692)
----------- --------- --------- ------- -------- ------------ ------------
Net realized gains (losses) from
securities transactions 147,427 (2,418) (50,898) (157) 10 168,710 4,202,939
----------- --------- --------- ------- -------- ------------ ------------
Net unrealized appreciation
(depreciation) of investments:
Beginning of period (22,081) (355,199) (131,959) 0 0 71,005 29,022,530
End of period 590,287 309,226 (273,537) (2,755) 23,686 57,440 71,574,054
----------- --------- --------- ------- -------- ------------ ------------
Change in net unrealized
appreciation/depreciation
of investments 612,368 664,425 (141,578) (2,755) 23,686 (13,565) 42,551,524
----------- --------- --------- ------- -------- ------------ ------------
Increase (decrease) in net
assets from operations $ 785,037 $ 639,425 $(168,828) $(2,967) $ 23,232 $ 311,684 $ 64,926,547
=========== ========= ========= ======= ======== ============ ============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 45
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE ONE MONTH ENDED
DECEMBER 31, 1999
<TABLE>
<CAPTION>
Government International
Capital Natural and Diversified Global Aggressive
Appreciation Growth Resources Quality Bond Equities Equities Growth
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ----------- ---------- ------------ ------------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ (51,228) $ (21,969) $ (2,214) $ (13,897) $ (18,856) $ (15,271) $ (23,992)
Net realized gains (losses)
from securities transactions 126,385 99,572 (607) (18,805) 119,801 27,467 34,420
Change in net unrealized
appreciation/depreciation of
investments 6,658,500 1,479,350 163,391 (44,139) 1,201,590 1,111,732 4,403,389
----------- ----------- ---------- ----------- ----------- ----------- -----------
Increase (decrease) in net
assets from operations 6,733,657 1,556,953 160,570 (76,841) 1,302,535 1,123,928 4,413,817
----------- ----------- ---------- ----------- ----------- ----------- -----------
From capital transactions:
Net proceeds from units sold 1,182,326 556,828 70,089 759,199 198,619 471,700 718,519
Cost of units redeemed (329,250) (167,463) (10,799) (69,718) (217,653) (43,457) (35,145)
Net transfers 286,716 (338,282) (5,147) (332,529) (230,595) 145,037 672,290
----------- ----------- ---------- ----------- ----------- ----------- -----------
Increase (decrease) in net
assets from capital
transactions 1,139,792 51,083 54,143 356,952 (249,629) 573,280 1,355,664
----------- ----------- ---------- ----------- ----------- ----------- -----------
Increase (decrease) in net assets 7,873,449 1,608,036 214,713 280,111 1,052,906 1,697,208 5,769,481
Net assets at beginning of period 35,652,332 16,151,495 1,659,358 10,939,968 14,267,667 11,170,312 15,316,811
----------- ----------- ---------- ----------- ----------- ----------- -----------
Net assets at end of period $43,525,781 $17,759,531 $1,874,071 $11,220,079 $15,320,573 $12,867,520 $21,086,292
=========== =========== ========== =========== =========== =========== ===========
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 28,996 17,651 5,780 56,923 12,275 18,619 31,967
Units redeemed (8,411) (5,376) (938) (5,220) (13,798) (1,762) (1,656)
Units transferred 7,853 (10,826) (511) (24,789) (14,240) 5,739 32,101
----------- ----------- ---------- ----------- ----------- ----------- -----------
Increase (decrease) in units
outstanding 28,438 1,449 4,331 26,914 (15,763) 22,596 62,412
Beginning units 979,651 543,129 145,614 817,993 921,115 461,621 805,328
----------- ----------- ---------- ----------- ----------- ----------- -----------
Ending units 1,008,089 544,578 149,945 844,907 905,352 484,217 867,740
=========== =========== ========== =========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 46
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE ONE MONTH ENDED
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
MFS
Venture Federated Putnam Growth & Alliance Growth- Asset
Value Value Growth Income Growth Income Allocation
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ---------- ----------- ----------- ----------- ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ (82,269) $ (11,817) $ (32,635) $ (12,946) $ (116,643) $ (75,750) $ (26,083)
Net realized gains (losses)
from securities transactions 165,569 6,195 1,485 (3,767) 65,803 80,610 (2,751)
Change in net unrealized
appreciation/depreciation of
investments 3,021,995 260,829 2,829,956 504,556 8,380,372 4,770,749 768,991
----------- ---------- ----------- ----------- ----------- ----------- -----------
Increase (decrease) in net
assets from operations 3,105,295 255,207 2,798,806 487,843 8,329,532 4,775,609 740,157
----------- ---------- ----------- ----------- ----------- ----------- -----------
From capital transactions:
Net proceeds from units sold 961,064 123,368 1,148,731 415,346 4,080,702 2,234,404 287,760
Cost of units redeemed (407,481) (62,567) (106,208) (51,080) (367,314) (346,978) (131,033)
Net transfers (350,338) 60,340 256,438 (18,040) 1,019,253 25,762 13,204
----------- ---------- ----------- ----------- ----------- ----------- -----------
Increase (decrease) in net
assets from capital
transactions 203,245 121,141 1,298,961 346,226 4,732,641 1,913,188 169,931
----------- ---------- ----------- ----------- ----------- ----------- -----------
Increase (decrease) in net assets 3,308,540 376,348 4,097,767 834,069 13,062,173 6,688,797 910,088
Net assets at beginning of period 62,795,720 9,125,265 23,476,467 9,704,314 84,270,036 55,594,028 19,895,410
----------- ---------- ----------- ----------- ----------- ----------- -----------
Net assets at end of period $66,104,260 $9,501,613 $27,574,234 $10,538,383 $97,332,209 $62,282,825 $20,805,498
=========== ========== =========== =========== =========== =========== ===========
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 35,399 7,437 37,637 18,017 88,009 64,711 14,632
Units redeemed (15,240) (3,791) (3,577) (2,231) (8,052) (10,186) (6,759)
Units transferred (13,089) 3,607 8,712 (823) 22,599 942 551
----------- ---------- ----------- ----------- ----------- ----------- -----------
Increase (decrease) in units
outstanding 7,070 7,253 42,772 14,963 102,556 55,467 8,424
Beginning units 2,363,904 555,385 828,070 430,432 1,901,945 1,679,055 1,041,762
----------- ---------- ----------- ----------- ----------- ----------- -----------
Ending units 2,370,974 562,638 870,842 445,395 2,004,501 1,734,522 1,050,186
=========== ========== =========== =========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 47
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE ONE MONTH ENDED
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
SunAmerica MFS Total Worldwide High-Yield Global Corporate
Balanced Return Utility High Income Bond Bond Bond
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ----------- ----------- ----------- ----------- ---------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ (25,272) $ (11,335) $ (6,123) $ (9,442) $ (21,447) $ (6,024) $ (7,203)
Net realized gains (losses)
from securities transactions 10,060 (277) 294 (18,658) (5,601) (3,358) (1,358)
Change in net unrealized
appreciation/depreciation of
investments 1,513,886 62,974 (8,155) 249,778 205,740 747 (3,777)
----------- ----------- ----------- ----------- ----------- ---------- ----------
Increase (decrease) in net
assets from operations 1,498,674 51,362 (13,984) 221,678 178,692 (8,635) (12,338)
----------- ----------- ----------- ----------- ----------- ---------- ----------
From capital transactions:
Net proceeds from units sold 1,419,852 428,073 295,194 47,758 190,170 202,829 108,799
Cost of units redeemed (108,046) (55,520) (7,717) (25,876) (67,992) (77,073) (8,664)
Net transfers (88,523) 100,084 9,168 (107,397) 2,337,488 5,865 4,830
----------- ----------- ----------- ----------- ----------- ---------- ----------
Increase (decrease) in net
assets from capital
transactions 1,223,283 472,637 296,645 (85,515) 2,459,666 131,621 104,965
----------- ----------- ----------- ----------- ----------- ---------- ----------
Increase (decrease) in net assets 2,721,957 523,999 282,661 136,163 2,638,358 122,986 92,627
Net assets at beginning of period 18,282,476 8,592,381 4,674,319 7,281,716 14,804,931 4,682,824 5,582,199
----------- ----------- ----------- ----------- ----------- ---------- ----------
Net assets at end of period $21,004,433 $ 9,116,380 $ 4,956,980 $ 7,417,879 $17,443,289 $4,805,810 $5,674,826
=========== =========== =========== =========== =========== ========== ==========
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 74,273 23,133 19,767 2,907 12,825 14,376 8,514
Units redeemed (5,723) (3,025) (515) (1,673) (4,595) (5,463) (677)
Units transferred (4,715) 5,408 613 (6,789) 157,978 417 382
----------- ----------- ----------- ----------- ----------- ---------- ----------
Increase (decrease) in units
outstanding 63,835 25,516 19,865 (5,555) 166,208 9,330 8,219
Beginning units 1,003,514 464,535 308,375 478,116 1,006,610 331,825 443,122
----------- ----------- ----------- ----------- ----------- ---------- ----------
Ending units 1,067,349 490,051 328,240 472,561 1,172,818 341,155 451,341
=========== =========== =========== =========== =========== ========== ==========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 48
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE ONE MONTH ENDED
DECEMBER 31, 1999
(Continued)
<TABLE>
<CAPTION>
International "Dogs" MFS
Growth & Emerging Real of Wall Mid-Cap Cash
Income Markets Estate Street Growth Management
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio TOTAL
------------- ----------- ----------- --------- ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 626,498 $ (4,290) $ (1,558) $ (203) $ 17,451 $ (14,886) $ 30,596
Net realized gains (losses)
from securities transactions 11,573 10,674 (3,236) (108) 7,079 19,120 727,581
Change in net unrealized
appreciation/depreciation of
investments (312,713) 593,389 62,817 (469) 138,460 40,546 38,054,484
----------- ----------- ----------- --------- ----------- ------------ ------------
Increase (decrease) in net
assets from operations 325,358 599,773 58,023 (780) 162,990 44,780 38,812,661
----------- ----------- ----------- --------- ----------- ------------ ------------
From capital transactions:
Net proceeds from units sold 321,291 226,527 43,595 128,166 174,073 1,672,118 18,467,100
Cost of units redeemed (18,796) (10,883) (1,788) (568) (37) (120,392) (2,849,498)
Net transfers 219,297 (4,358) 9,494 11,564 182,714 (1,312,939) 2,571,396
----------- ----------- ----------- --------- ----------- ------------ ------------
Increase (decrease) in net
assets from capital
transactions 521,792 211,286 51,301 139,162 356,750 238,787 18,188,998
----------- ----------- ----------- --------- ----------- ------------ ------------
Increase (decrease) in net assets 847,150 811,059 109,324 138,382 519,740 283,567 57,001,659
Net assets at beginning of period 6,362,057 2,919,924 1,193,513 72,578 927,604 12,282,449 457,678,154
----------- ----------- ----------- --------- ----------- ------------ ------------
Net assets at end of period $ 7,209,207 $ 3,730,983 $ 1,302,837 $ 210,960 $ 1,447,344 $ 12,566,016 $514,679,813
=========== =========== =========== ========= =========== ============ ============
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 23,021 22,722 5,101 14,286 11,043 136,713
Units redeemed (1,370) (1,174) (212) (63) (2) (9,859)
Units transferred 15,837 10 952 1,292 12,544 (107,605)
----------- ----------- ----------- --------- ----------- ------------
Increase (decrease) in units
outstanding 37,488 21,558 5,841 15,515 23,585 19,249
Beginning units 475,183 324,647 140,396 7,956 65,176 1,003,095
----------- ----------- ----------- --------- ----------- ------------
Ending units 512,671 346,205 146,237 23,471 88,761 1,022,344
=========== =========== =========== ========= =========== ============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 49
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED
NOVEMBER 30, 1999
<TABLE>
<CAPTION>
Government International
Capital Natural and Diversified Global Aggressive
Appreciation Growth Resources Quality Bond Equities Equities Growth
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ------------ ----------- ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 968,768 $ 734,824 $ (397) $ 507,735 $ 74,946 $ 592,772 $ 782,838
Net realized gains (losses) from
securities transactions 513,844 184,462 (38,322) (117,340) 423,093 306,270 323,190
Change in net unrealized
appreciation/depreciation of
investments 9,697,862 1,472,792 253,357 (565,998) 1,304,202 1,208,439 3,839,528
------------ ------------ ----------- ------------ ------------ ------------ ------------
Increase (decrease) in net
assets from operations 11,180,474 2,392,078 214,638 (175,603) 1,802,241 2,107,481 4,945,556
------------ ------------ ----------- ------------ ------------ ------------ ------------
From capital transactions:
Net proceeds from units sold 4,396,408 3,067,756 200,248 2,844,016 1,347,292 1,839,879 2,556,481
Cost of units redeemed (1,223,734) (485,398) (63,356) (611,875) (621,833) (493,870) (509,416)
Net transfers 2,224,602 1,724,554 281,740 322,328 (496,446) (285,700) 1,247,823
------------ ------------ ----------- ------------ ------------ ------------ ------------
Increase (decrease) in net
assets from capital
transactions 5,397,276 4,306,912 418,632 2,554,469 229,013 1,060,309 3,294,888
------------ ------------ ----------- ------------ ------------ ------------ ------------
Increase (decrease) in net assets 16,577,750 6,698,990 633,270 2,378,866 2,031,254 3,167,790 8,240,444
Net assets at beginning of period 19,074,582 9,452,505 1,026,088 8,561,102 12,236,413 8,002,522 7,076,367
------------ ------------ ----------- ------------ ------------ ------------ ------------
Net assets at end of period $ 35,652,332 $ 16,151,495 $ 1,659,358 $ 10,939,968 $ 14,267,667 $ 11,170,312 $ 15,316,811
============ ============ =========== ============ ============ ============ ============
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 144,596 110,203 17,632 212,190 94,873 84,551 161,749
Units redeemed (42,297) (17,795) (6,098) (45,224) (43,819) (23,448) (32,368)
Units transferred 73,294 63,527 23,775 24,449 (33,987) (16,138) 79,469
------------ ------------ ----------- ------------ ------------ ------------ ------------
Increase (decrease) in units
outstanding 175,593 155,935 35,309 191,415 17,067 44,965 208,850
Beginning units 804,058 387,194 110,305 626,578 904,048 416,656 596,478
------------ ------------ ----------- ------------ ------------ ------------ ------------
Ending units 979,651 543,129 145,614 817,993 921,115 461,621 805,328
============ ============ =========== ============ ============ ============ ============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 50
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
MFS
Venture Federated Putnam Growth & Alliance Growth- Asset
Value Value Growth Income Growth Income Allocation
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ----------- ------------ ----------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 1,687,566 $ 286,169 $ 315,342 $ 1,352,307 $ 4,705,675 $ 1,599,474 $ 1,288,468
Net realized gains (losses) from
securities transactions 734,208 102,760 155,549 41,888 873,596 469,387 38,506
Change in net unrealized
appreciation/depreciation of
investments 4,576,614 (170,848) 3,260,411 (963,621) 10,641,927 7,053,270 (407,550)
------------ ----------- ------------ ----------- ------------ ------------ ------------
Increase (decrease) in net
assets from operations 6,998,388 218,081 3,731,302 430,574 16,221,198 9,122,131 919,424
------------ ----------- ------------ ----------- ------------ ------------ ------------
From capital transactions:
Net proceeds from units sold 6,915,003 1,404,033 6,745,941 4,299,352 19,788,323 15,135,510 2,729,069
Cost of units redeemed (2,642,692) (354,276) (626,195) (176,730) (2,985,661) (1,465,455) (1,148,046)
Net transfers 1,308,016 717,611 3,069,173 1,227,250 12,676,479 6,258,088 (1,158,630)
------------ ----------- ------------ ----------- ------------ ------------ ------------
Increase (decrease) in net
assets from capital
transactions 5,580,327 1,767,368 9,188,919 5,349,872 29,479,141 19,928,143 422,393
------------ ----------- ------------ ----------- ------------ ------------ ------------
Increase (decrease) in net assets 12,578,715 1,985,449 12,920,221 5,780,446 45,700,339 29,050,274 1,341,817
Net assets at beginning of period 50,217,005 7,139,816 10,556,246 3,923,868 38,569,697 26,543,754 18,553,593
------------ ----------- ------------ ----------- ------------ ------------ ------------
Net assets at end of period $ 62,795,720 $ 9,125,265 $ 23,476,467 $ 9,704,314 $ 84,270,036 $ 55,594,028 $ 19,895,410
============ =========== ============ =========== ============ ============ ============
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 267,228 84,344 258,838 191,987 483,986 491,181 146,690
Units redeemed (101,509) (21,355) (23,483) (7,736) (72,730) (47,537) (61,403)
Units transferred 48,666 42,258 119,189 54,419 315,108 202,928 (61,875)
------------ ----------- ------------ ----------- ------------ ------------ ------------
Increase (decrease) in units
outstanding 214,385 105,247 354,544 238,670 726,364 646,572 23,412
Beginning units 2,149,519 450,138 473,526 191,762 1,175,581 1,032,483 1,018,350
------------ ----------- ------------ ----------- ------------ ------------ ------------
Ending units 2,363,904 555,385 828,070 430,432 1,901,945 1,679,055 1,041,762
============ =========== ============ =========== ============ ============ ============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 51
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
SunAmerica MFS Total Worldwide High-Yield Global Corporate
Balanced Return Utility High Income Bond Bond Bond
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ----------- ----------- ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 56,187 $ 793,254 $ 180,550 $ 614,317 $ 1,047,612 $ 251,407 $ 149,942
Net realized gains (losses) from
securities transactions 193,288 24,894 73,424 (474,225) 80,370 9,212 22,211
Change in net unrealized
appreciation/depreciation of
investments 1,456,679 (498,590) (95,354) 575,049 (590,312) (339,063) (299,851)
------------ ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net
assets from operations 1,706,154 319,558 158,620 715,141 537,670 (78,444) (127,698)
------------ ----------- ----------- ----------- ------------ ----------- -----------
From capital transactions:
Net proceeds from units sold 6,390,363 2,494,548 1,133,139 903,366 1,565,282 1,082,391 1,072,499
Cost of units redeemed (679,177) (234,253) (745,338) (329,404) (725,239) (263,206) (252,048)
Net transfers 3,567,586 1,211,053 487,967 (335,748) (2,098,090) 237,180 503,077
------------ ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net
assets from capital
transactions 9,278,772 3,471,348 875,768 238,214 (1,258,047) 1,056,365 1,323,528
------------ ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net assets 10,984,926 3,790,906 1,034,388 953,355 (720,377) 977,921 1,195,830
Net assets at beginning of period 7,297,550 4,801,475 3,639,931 6,328,361 15,525,308 3,704,903 4,386,369
------------ ----------- ----------- ----------- ------------ ----------- -----------
Net assets at end of period $ 18,282,476 $ 8,592,381 $ 4,674,319 $ 7,281,716 $ 14,804,931 $ 4,682,824 $ 5,582,199
============ =========== =========== =========== ============ =========== ===========
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 367,902 134,140 75,486 64,615 107,370 76,602 90,038
Units redeemed (38,568) (12,620) (49,641) (23,258) (49,568) (18,356) (19,585)
Units transferred 206,453 65,075 32,482 (29,474) (140,242) 16,320 39,159
------------ ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in units
outstanding 535,787 186,595 58,327 11,883 (82,440) 74,566 109,612
Beginning units 467,727 277,940 250,048 466,233 1,089,050 257,259 333,510
------------ ----------- ----------- ----------- ------------ ----------- -----------
Ending units 1,003,514 464,535 308,375 478,116 1,006,610 331,825 443,122
============ =========== =========== =========== ============ =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 52
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED
NOVEMBER 30, 1999
(Continued)
<TABLE>
<CAPTION>
International "Dogs" of MFS
Growth & Emerging Real Wall Mid-Cap Cash
Income Markets Estate Street Growth Management
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio TOTAL
------------- ----------- ----------- -------- --------- ------------ -------------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 25,242 $ (22,582) $ 23,648 $ (55) $ (464) $ 156,539 $ 18,172,084
Net realized gains (losses) from
securities transactions 147,427 (2,418) (50,898) (157) 10 168,710 4,202,939
Change in net unrealized
appreciation/depreciation of
investments 612,368 664,425 (141,578) (2,755) 23,686 (13,565) 42,551,524
----------- ----------- ----------- -------- --------- ------------ -------------
Increase (decrease) in net
assets from operations 785,037 639,425 (168,828) (2,967) 23,232 311,684 64,926,547
----------- ----------- ----------- -------- --------- ------------ -------------
From capital transactions:
Net proceeds from units sold 1,312,819 750,424 166,442 11,984 73,969 6,322,984 96,549,521
Cost of units redeemed (207,120) (140,331) (124,260) 0 (33) (2,240,181) (19,349,127)
Net transfers 1,020,812 561,863 19,446 63,561 830,436 638,480 35,824,511
----------- ----------- ----------- -------- --------- ------------ -------------
Increase (decrease) in net
assets from capital
transactions 2,126,511 1,171,956 61,628 75,545 904,372 4,721,283 113,024,905
----------- ----------- ----------- -------- --------- ------------ -------------
Increase (decrease) in net assets 2,911,548 1,811,381 (107,200) 72,578 927,604 5,032,967 177,951,452
Net assets at beginning of period 3,450,509 1,108,543 1,300,713 0 0 7,249,482 279,726,702
----------- ----------- ----------- -------- --------- ------------ -------------
Net assets at end of period $ 6,362,057 $ 2,919,924 $ 1,193,513 $ 72,578 $ 927,604 $ 12,282,449 $ 457,678,154
=========== =========== =========== ======== ========= ============ =============
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 101,430 92,737 17,918 1,273 5,150 519,559
Units redeemed (16,492) (17,433) (12,687) 0 (2) (185,958)
Units transferred 80,944 68,707 2,396 6,683 60,028 56,596
----------- ----------- ----------- -------- --------- ------------
Increase (decrease) in units
outstanding 165,882 144,011 7,627 7,956 65,176 390,197
Beginning units 309,301 180,636 132,769 0 0 612,898
----------- ----------- ----------- -------- --------- ------------
Ending units 475,183 324,647 140,396 7,956 65,176 1,003,095
=========== =========== =========== ======== ========= ============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 53
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED
NOVEMBER 30, 1998
<TABLE>
<CAPTION>
Government International
Capital Natural and Diversified Global Aggressive
Appreciation Growth Resources Quality Bond Equities Equities Growth
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ----------- ----------- ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 1,227,568 $ 388,972 $ 8,780 $ 264,194 $ 283,071 $ 454,718 $ (94,874)
Net realized gains (losses) from
securities transactions 22,899 127,178 (110,450) 37,824 119,842 17,698 79,570
Change in net unrealized
appreciation/depreciation of
investments 85,950 658,358 (120,255) 97,568 1,122,315 240,160 229,945
------------ ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net
assets from operations 1,336,417 1,174,508 (221,925) 399,586 1,525,228 712,576 214,641
------------ ----------- ----------- ----------- ------------ ----------- -----------
From capital transactions:
Net proceeds from units sold 4,942,068 3,304,666 176,293 1,853,388 1,547,510 1,473,684 894,970
Cost of units redeemed (787,591) (207,547) (131,515) (292,304) (560,675) (345,876) (269,338)
Net transfers 2,737,190 1,188,428 (49,918) 4,190,296 977,239 918,200 735,402
------------ ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net
assets from capital
transactions 6,891,667 4,285,547 (5,140) 5,751,380 1,964,074 2,046,008 1,361,034
------------ ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net assets 8,228,084 5,460,055 (227,065) 6,150,966 3,489,302 2,758,584 1,575,675
Net assets at beginning of period 10,846,498 3,992,450 1,253,153 2,410,136 8,747,111 5,243,938 5,500,692
------------ ----------- ----------- ----------- ------------ ----------- -----------
Net assets at end of period $ 19,074,582 $ 9,452,505 $ 1,026,088 $ 8,561,102 $ 12,236,413 $ 8,002,522 $ 7,076,367
============ =========== =========== =========== ============ =========== ===========
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 212,499 144,681 16,267 139,202 118,796 80,590 77,340
Units redeemed (34,848) (9,137) (11,605) (22,362) (42,877) (18,942) (22,932)
Units transferred 116,116 55,111 (6,866) 319,289 75,119 44,737 64,067
------------ ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in units
outstanding 293,767 190,655 (2,204) 436,129 151,038 106,385 118,475
Beginning units 510,291 196,539 112,509 190,449 753,010 310,271 478,003
------------ ----------- ----------- ----------- ------------ ----------- -----------
Ending units 804,058 387,194 110,305 626,578 904,048 416,656 596,478
============ =========== =========== =========== ============ =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 54
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED
NOVEMBER 30, 1998
(Continued)
<TABLE>
<CAPTION>
MFS
Venture Federated Putnam Growth & Alliance Growth- Asset
Value Value Growth Income Growth Income Allocation
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
------------ ----------- ------------ ----------- ------------ ------------ ------------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 723,947 $ 21,897 $ 806,116 $ 478,189 $ 1,670,147 $ 527,209 $ 1,331,861
Net realized gains (losses) from
securities transactions 264,654 49,179 53,163 24,267 297,229 237,467 (25,675)
Change in net unrealized
appreciation/depreciation of
investments 2,430,673 603,723 308,957 477 5,190,554 2,574,637 (1,331,054)
------------ ----------- ------------ ----------- ------------ ------------ ------------
Increase (decrease) in net
assets from operations 3,419,274 674,799 1,168,236 502,933 7,157,930 3,339,313 (24,868)
------------ ----------- ------------ ----------- ------------ ------------ ------------
From capital transactions:
Net proceeds from units sold 12,744,773 2,315,211 3,411,992 511,624 9,419,032 7,062,392 6,570,519
Cost of units redeemed (1,639,027) (172,878) (235,220) (98,262) (799,429) (1,104,069) (688,398)
Net transfers 5,353,688 1,347,230 1,928,117 281,207 6,141,424 4,096,692 2,231,029
------------ ----------- ------------ ----------- ------------ ------------ ------------
Increase (decrease) in net
assets from capital
transactions 16,459,434 3,489,563 5,104,889 694,569 14,761,027 10,055,015 8,113,150
------------ ----------- ------------ ----------- ------------ ------------ ------------
Increase (decrease) in net assets 19,878,708 4,164,362 6,273,125 1,197,502 21,918,957 13,394,328 8,088,282
Net assets at beginning of period 30,338,297 2,975,454 4,283,121 2,726,366 16,650,740 13,149,426 10,465,311
------------ ----------- ------------ ----------- ------------ ------------ ------------
Net assets at end of period $ 50,217,005 $ 7,139,816 $ 10,556,246 $ 3,923,868 $ 38,569,697 $ 26,543,754 $ 18,553,593
============ =========== ============ =========== ============ ============ ============
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 560,919 153,801 163,068 27,206 317,332 295,954 354,848
Units redeemed (73,088) (11,603) (11,582) (5,052) (27,392) (47,211) (37,538)
Units transferred 237,346 89,436 90,157 14,973 206,197 169,433 119,118
------------ ----------- ------------ ----------- ------------ ------------ ------------
Increase (decrease) in units
outstanding 725,177 231,634 241,643 37,127 496,137 418,176 436,428
Beginning units 1,424,342 218,504 231,883 154,635 679,444 614,307 581,922
------------ ----------- ------------ ----------- ------------ ------------ ------------
Ending units 2,149,519 450,138 473,526 191,762 1,175,581 1,032,483 1,018,350
============ =========== ============ =========== ============ ============ ============
</TABLE>
See accompanying notes to financial statements.
<PAGE> 55
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED
NOVEMBER 30, 1998
(Continued)
<TABLE>
<CAPTION>
SunAmerica MFS Total Worldwide High-Yield Global Corporate
Balanced Return Utility High Income Bond Bond Bond
Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio Portfolio
----------- ----------- ----------- ----------- ------------ ----------- -----------
<S> <C> <C> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ 58,747 $ 363,935 $ 30,073 $ 605,767 $ 545,909 $ 172,264 $ 61,460
Net realized gains (losses) from
securities transactions 37,278 38,763 103,393 (303,959) 136,518 26,630 22,213
Change in net unrealized
appreciation/depreciation of
investments 707,049 56,190 147,621 (1,355,041) (963,961) 86,226 54,697
----------- ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net
assets from operations 803,074 458,888 281,087 (1,053,233) (281,534) 285,120 138,370
----------- ----------- ----------- ----------- ------------ ----------- -----------
From capital transactions:
Net proceeds from units sold 1,837,716 693,592 783,939 1,250,340 5,883,457 733,458 1,245,555
Cost of units redeemed (135,107) (217,567) (165,000) (249,264) (789,849) (197,174) (212,682)
Net transfers 1,611,937 301,720 1,976,425 (7,698) 2,681,671 939,270 1,698,553
----------- ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net
assets from capital
transactions 3,314,546 777,745 2,595,364 993,378 7,775,279 1,475,554 2,731,426
----------- ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in net assets 4,117,620 1,236,633 2,876,451 (59,855) 7,493,745 1,760,674 2,869,796
Net assets at beginning of period 3,179,930 3,564,842 763,480 6,388,216 8,031,563 1,944,229 1,516,573
----------- ----------- ----------- ----------- ------------ ----------- -----------
Net assets at end of period $ 7,297,550 $ 4,801,475 $ 3,639,931 $ 6,328,361 $ 15,525,308 $ 3,704,903 $ 4,386,369
=========== =========== =========== =========== ============ =========== ===========
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 126,475 42,526 56,431 78,429 389,088 52,795 96,678
Units redeemed (9,360) (13,558) (11,921) (16,000) (51,770) (14,515) (16,575)
Units transferred 110,056 18,188 145,631 3,939 203,945 70,377 132,410
----------- ----------- ----------- ----------- ------------ ----------- -----------
Increase (decrease) in units
outstanding 227,171 47,156 190,141 66,368 541,263 108,657 212,513
Beginning units 240,556 230,784 59,907 399,865 547,787 148,602 120,997
----------- ----------- ----------- ----------- ------------ ----------- -----------
Ending units 467,727 277,940 250,048 466,233 1,089,050 257,259 333,510
=========== =========== =========== =========== ============ =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 56
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
STATEMENT OF CHANGES IN NET ASSETS
FOR THE YEAR ENDED
NOVEMBER 30, 1998
(Continued)
<TABLE>
<CAPTION>
International Emerging Real Cash
Growth & Income Markets Estate Management
Portfolio Portfolio Portfolio Portfolio TOTAL
----------- ----------- ----------- ----------- -------------
<S> <C> <C> <C> <C> <C>
INCREASE (DECREASE) IN NET ASSETS:
From operations:
Net investment income (loss) $ (24,230) $ (6,903) $ (5,395) $ 113,716 $ 10,007,138
Net realized gains (losses) from
securities transactions 18,562 (53,935) (21,251) 16,732 1,215,789
Change in net unrealized
appreciation/depreciation of
investments (9,413) (183,604) (167,462) 45,324 10,509,634
----------- ----------- ----------- ----------- -------------
Increase (decrease) in net
assets from operations (15,081) (244,442) (194,108) 175,772 21,732,561
----------- ----------- ----------- ----------- -------------
From capital transactions:
Net proceeds from units sold 1,737,790 450,479 600,695 4,749,901 76,195,044
Cost of units redeemed (87,937) (96,180) (85,904) (553,170) (10,121,963)
Net transfers 924,651 318,627 335,065 228,417 43,084,862
----------- ----------- ----------- ----------- -------------
Increase (decrease) in net assets
from capital transactions 2,574,504 672,926 849,856 4,425,148 109,157,943
----------- ----------- ----------- ----------- -------------
Increase (decrease) in net assets 2,559,423 428,484 655,748 4,600,920 130,890,504
Net assets at beginning of period 891,086 680,059 644,965 2,648,562 148,836,198
----------- ----------- ----------- ----------- -------------
Net assets at end of period $ 3,450,509 $ 1,108,543 $ 1,300,713 $ 7,249,482 $ 279,726,702
=========== =========== =========== =========== =============
ANALYSIS OF INCREASE (DECREASE)
IN UNITS OUTSTANDING:
Units sold 149,664 63,238 54,654 408,341
Units redeemed (7,585) (11,785) (7,748) (47,629)
Units transferred 80,974 43,870 29,484 20,512
----------- ----------- ----------- -----------
Increase (decrease) in units
outstanding 223,053 95,323 76,390 381,224
Beginning units 86,248 85,313 56,379 231,674
----------- ----------- ----------- -----------
Ending units 309,301 180,636 132,769 612,898
=========== =========== =========== ===========
</TABLE>
See accompanying notes to financial statements.
<PAGE> 57
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
1. ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
FS Variable Separate Account of First SunAmerica Life Insurance Company
(the "Separate Account") is a segregated investment account of First
SunAmerica Life Insurance Company (the "Company"). The Company is an
indirect, wholly owned subsidiary of American International Group, Inc.
("AIG"), an international insurance and financial services company. At
December 31, 1998, the Company was a wholly owned indirect subsidiary of
SunAmerica Inc., a Maryland corporation. On January 1, 1999, SunAmerica
Inc. merged with and into AIG in a tax-free reorganization that has been
treated as a pooling of interests for accounting purposes. Thus,
SunAmerica Inc. ceased to exist on that date. However, immediately prior
to the effectiveness of the merger, substantially all of the net assets
of SunAmerica Inc. were contributed to a newly formed subsidiary of AIG
named SunAmerica Holdings, Inc., a Delaware corporation. SunAmerica
Holdings, Inc. subsequently changed its name to SunAmerica Inc. The
Separate Account is registered as a segregated unit investment trust
pursuant to the provisions of the Investment Company Act of 1940, as
amended.
The Separate Account is composed of twenty-seven variable portfolios
(the "Variable Accounts"). Each of the Variable Accounts is invested
solely in the shares of either (1) one of the four currently available
investment portfolios of Anchor Series Trust ("Anchor Trust") or (2) one
of the twenty-three currently available investment portfolios of
SunAmerica Series Trust ("SunAmerica Trust"). The Anchor Trust and the
SunAmerica Trust (the "Trusts") are each diversified, open-end,
affiliated investment companies, which retain investment advisors to
assist in the investment activities of the Trusts. The participant may
elect to have payments allocated to any of seven guaranteed-interest
funds of the Company (the "General Account"), which are not a part of
the Separate Account. The financial statements include balances
allocated by the participant to the twenty-seven Variable Accounts and
do not include balances allocated to the General Account.
The inception dates of the twenty-seven individual funds were as
follows: October 19, 1999 for the "Dogs" of Wall Street and MFS Mid-Cap
Growth Portfolios; June 12, 1997 for the Emerging Markets Portfolio;
June 9, 1997 for the International Growth and Income Portfolio; June 2,
1997 for the Real Estate Portfolio; June 3, 1996 for the Aggressive
Growth, Federated Value, SunAmerica Balanced, and Utility Portfolios;
May 30, 1995 for the Natural Resources Portfolio; May 22, 1995 for the
Global Equities Portfolio; May 8, 1995 for MFS Total Return and
High-Yield Bond Portfolios; May 3, 1995 for the Government and Quality
Bond Portfolio; May 2, 1995 for the Worldwide High Income and Global
Bond Portfolios; April 27, 1995 for the Cash Management Portfolio; April
24, 1995 for the Asset Allocation Portfolio; April 12, 1995 for the
International Diversified Equities, Growth-Income, and Corporate Bond
Portfolios; and April 6, 1995 for the Capital Appreciation, Growth,
Venture Value, Putnam Growth, MFS Growth & Income and Alliance Growth
Portfolios.
1
<PAGE> 58
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The investment objectives and policies of the four portfolios of the
Anchor Trust are summarized below:
The CAPITAL APPRECIATION PORTFOLIO seeks long-term capital appreciation.
This portfolio invests in growth equity securities which are widely
diversified by industry and company using a wide-ranging and flexible
stock picking approach; may be concentrated and will generally have less
investments in large company securities than the Growth Portfolio.
The GROWTH PORTFOLIO seeks capital appreciation. This portfolio invests
in core equity securities that are widely diversified by industry and
company.
The NATURAL RESOURCES PORTFOLIO seeks a total return in excess of the
U.S. rate of inflation as represented by the Consumer Price Index. This
portfolio invests primarily in equity securities of U.S. or foreign
companies which are expected to provide favorable returns in periods of
rising inflation.
The GOVERNMENT AND QUALITY BOND PORTFOLIO seeks relatively high current
income, liquidity and security of principal. This portfolio invests in
obligations issued, guaranteed or insured by the U.S. Government, its
agencies or instrumentalities and in high quality corporate fixed income
securities.
Anchor Trust has portfolios in addition to those identified above;
however, none of these other portfolios is currently available for
investment under the Separate Account.
The investment objectives and policies of the twenty-three portfolios of
the SunAmerica Trust are summarized below:
The INTERNATIONAL DIVERSIFIED EQUITIES PORTFOLIO seeks long-term capital
appreciation. This portfolio invests (in accordance with country
weightings as determined by the Subadviser) in common stocks of foreign
issuers which, in the aggregate, replicate broad country and sector
indices.
2
<PAGE> 59
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The GLOBAL EQUITIES PORTFOLIO seeks long-term growth of capital. This
portfolio invests primarily in common stocks or securities of U.S. and
foreign issuers with common stock characteristics which demonstrate the
potential for appreciation and engages in transactions in foreign
currencies
The AGGRESSIVE GROWTH PORTFOLIO seeks capital appreciation. This
portfolio invests primarily in equity securities of high growth
companies including small companies with market capitalizations under $1
billion.
The VENTURE VALUE PORTFOLIO seeks growth of capital. This portfolio
invests primarily in common stocks of companies with market
capitalizations of at least $5 billion.
The FEDERATED VALUE PORTFOLIO seeks growth of capital and income. This
portfolio invests primarily in the securities of high quality companies.
The PUTNAM GROWTH PORTFOLIO seeks long-term growth of capital. This
portfolio invests primarily in common stocks or securities with common
stock characteristics that its Subadviser believes have above-average
growth prospects.
The MFS GROWTH AND INCOME PORTFOLIO (PREVIOUSLY KNOWN AS GROWTH/PHOENIX
INVESTMENT COUNSEL PORTFOLIO) seeks reasonable current income and
long-term growth of capital and income. This portfolio invests primarily
in equity securities.
The ALLIANCE GROWTH PORTFOLIO seeks long-term growth of capital. This
portfolio invests primarily in equity securities of a limited number of
large, carefully selected, high quality U.S. companies that are judged
likely to achieve superior earnings.
The GROWTH-INCOME PORTFOLIO seeks growth of capital and income. This
portfolio invests primarily in common stocks or securities which
demonstrate the potential for appreciation and/or dividends.
The ASSET ALLOCATION PORTFOLIO seeks high total return (including income
and capital gains) consistent with preservation of capital over the long
term. This portfolio invests in a diversified selection of common stocks
and other securities having common stock characteristics, bonds and
other intermediate and long-term fixed-income securities and money
market instruments (debt securities maturing in one year or less) in any
combination.
3
<PAGE> 60
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The SUNAMERICA BALANCED PORTFOLIO seeks to conserve principal. This
portfolio maintains at all times a balanced portfolio of stocks and
bonds, with at least 25% invested in fixed income securities.
The MFS TOTAL RETURN PORTFOLIO (PREVIOUSLY KNOWN AS BALANCED/PHOENIX
INVESTMENT COUNSEL PORTFOLIO) seeks reasonable income, long-term capital
growth and conservation of capital. This portfolio invests primarily in
common stocks and fixed-income securities, with an emphasis on
income-producing securities which appear to have some potential for
capital enhancement.
The UTILITY PORTFOLIO seeks high current income and moderate capital
appreciation. This portfolio invests primarily in the equity and debt
securities of utility companies.
The WORLDWIDE HIGH INCOME PORTFOLIO seeks high current income and,
secondarily, capital appreciation. This portfolio invests primarily in a
selection of high-yielding fixed-income securities of issuers located
throughout the world.
The HIGH-YIELD BOND PORTFOLIO seeks a high level of current income and,
secondarily, seeks capital appreciation. This portfolio invests
primarily in intermediate and long-term corporate obligations, with
emphasis on higher-yielding, higher-risk, lower-rated or unrated
securities with a primary focus on "B" rated high-yield bonds.
The GLOBAL BOND PORTFOLIO seeks a high total return, emphasizing current
income and, to a lesser extent, providing opportunities for capital
appreciation. This portfolio invests in high quality fixed-income
securities of U.S. and foreign issuers and engages in transactions in
foreign currencies.
The CORPORATE BOND PORTFOLIO seeks a high total return with only
moderate price risk. This portfolio invests primarily in investment
grade fixed-income securities.
The INTERNATIONAL GROWTH AND INCOME PORTFOLIO seeks growth of capital
with current income as a secondary objective. This portfolio invests
primarily in common stocks traded on markets outside the United States.
4
<PAGE> 61
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The EMERGING MARKETS PORTFOLIO seeks long-term capital appreciation.
This portfolio invests mainly in the common stocks and other equity
securities of companies that its Subadviser believes have above-average
growth prospects primarily in emerging markets outside the United
States.
The REAL ESTATE PORTFOLIO seeks to achieve total return through a
combination of growth and income. This portfolio invests primarily in
securities of companies principally engaged in or related to the real
estate industry or which own significant real estate assets or which
primarily invest in real estate financial instruments.
The "DOGS" OF WALL STREET PORTFOLIO seeks total return (including
capital appreciation and current income) primarily through the annual
selection of thirty high dividend yielding common stocks from the Dow
Jones Industrial Average and the broader market.
The MFS MID-CAP GROWTH PORTFOLIO seeks long-term growth of capital. This
portfolio invests primarily in equity securities of medium-sized
companies, generally with market capitalizations between $1 billion and
$5 billion, that its Subadviser believes have above-average growth
potential.
The CASH MANAGEMENT PORTFOLIO seeks high current yield while preserving
capital. This portfolio invests in a diversified selection of money
market instruments.
The SunAmerica Trust has portfolios in addition to those identified
above; however, none of these other portfolios is currently available
for investment under the Separate Account.
Purchases and sales of shares of the portfolios of the Trusts are valued
at the net asset values of the shares on the date the shares are
purchased or sold. Dividends and capital gains distributions are
recorded when received. Realized gains and losses on the sale of
investments in the Trusts are recognized at the date of sale and are
determined on an average cost basis.
Accumulation unit values are computed daily based on the total net
assets of the Variable Accounts.
5
<PAGE> 62
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
2. CHARGES AND DEDUCTIONS
Charges and deductions are applied against the current value of the
Separate Account and are paid as follows:
WITHDRAWAL CHARGE: The contract value may be withdrawn at any time
during the accumulation period. Purchase payments that are no longer
subject to the withdrawal charge and not previously withdrawn and
earnings in the contract may be withdrawn free of withdrawal charges at
any time. In addition, there is a free withdrawal amount for the first
withdrawal during a contract year after the first contract year. The
free withdrawal amount is the greater of earnings in the contract or 10%
of the purchase payments that have been invested for at least one year,
and not withdrawn, less any withdrawals made during the year. Should a
withdrawal exceed the free withdrawal amount, a withdrawal charge, in
certain circumstances, is imposed and paid to the Company.
Withdrawal charges vary in amount depending upon the number of years
since the purchase payment being withdrawn was made. The withdrawal
charge is deducted from the remaining contract value so that the actual
reduction in contract value as a result of the withdrawal will be
greater than the withdrawal amount requested and paid. For purposes of
determining the withdrawal charge, withdrawals will be allocated first
to investment income, if any (which may generally be withdrawn free of a
withdrawal charge), and then to the oldest purchase payments first so
that all withdrawals are allocated to purchase payments to which the
lowest (if any) withdrawal charge applies.
Any amount withdrawn which exceeds a free withdrawal may be subject to a
withdrawal charge in accordance with the withdrawal charge table shown
below:
<TABLE>
<CAPTION>
Year Since Purchase Applicable Withdrawal
Payment Charge Percentage
------------------- ---------------------
<S> <C>
First 7%
Second 6%
Third 5%
Fourth 4%
Fifth 3%
Sixth 2%
Seventh 1%
Eighth and beyond 0%
</TABLE>
6
<PAGE> 63
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
CHARGES AND DEDUCTIONS (continued)
CONTRACT MAINTENANCE FEE: An annual contract maintenance fee of $30 is
charged against each contract, which reimburses the Company for expenses
incurred in establishing and maintaining records relating to a contract.
The contract maintenance fee will be assessed on each anniversary during
the accumulation phase. In the event that a total surrender of contract
value is made, the entire charge will be assessed as of the date of
surrender.
TRANSFER FEE: A transfer fee of $25 is assessed on each transfer of
funds in excess of fifteen transactions within a contract year.
MORTALITY RISK, GUARANTEE DEATH BENEFIT AND EXPENSE RISK CHARGE: The
Company deducts mortality risk, guarantee death benefit and expense risk
charges, which total to an annual rate of 1.37% of the net asset value
of each portfolio, computed on a daily basis. The mortality risk charge
(0.90%) is compensation for the mortality risks assumed by the Company
from its contractual obligations to make annuity payments after the
contract has annuitized for the life of the annuitant. The guarantee
death benefit and expense risk charges (0.12% and 0.35%, respectively)
are compensation for providing death benefits, and for assuming the risk
that the current charges will be insufficient in the future to cover the
cost of administering the contract.
DISTRIBUTION EXPENSE CHARGE: The Company deducts a distribution expense
charge at an annual rate of 0.15% of the net asset value of each
portfolio, computed on a daily basis. This charge is for all expenses
associated with the distribution of the contract. These expenses include
preparing the contract, confirmations and statements, providing sales
support and maintaining contract records. If this charge is not enough
to cover the costs of distributing the contract, the Company will bear
the loss.
SEPARATE ACCOUNT INCOME TAXES: The Company currently does not maintain a
provision for taxes, but has reserved the right to establish such a
provision for taxes in the future if it determines, in its sole
discretion, that it will incur a tax as a result of the operation of the
Separate Account.
7
<PAGE> 64
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
3. INVESTMENT IN ANCHOR TRUST AND SUNAMERICA TRUST
The aggregate cost of the Trusts' shares acquired and the aggregate
proceeds from shares sold during the one month ended December 31, 1999
consist of the following:
<TABLE>
<CAPTION>
Cost of Shares Proceeds from
Variable Accounts Acquired Shares Sold
----------------- -------------- -------------
<S> <C> <C>
ANCHOR TRUST:
Capital Appreciation Portfolio $ 1,427,320 $ 338,756
Growth Portfolio 537,093 507,979
Natural Resources Portfolio 74,724 22,795
Government and Quality Bond Portfolio 772,442 429,387
SUNAMERICA TRUST:
International Diversified Equities Portfolio 323,097 591,582
Global Equities Portfolio 729,205 171,196
Aggressive Growth Portfolio 1,412,534 80,862
Venture Value Portfolio 868,944 747,968
Federated Value Portfolio 178,908 69,584
Provident Growth Portfolio 1,272,888 6,562
MFS Growth & Income Portfolio 411,904 78,624
Alliance Growth Portfolio 4,880,330 264,332
Growth-Income Portfolio 2,177,303 339,865
Asset Allocation Portfolio 350,043 206,195
SunAmerica Balanced Portfolio 1,262,341 64,330
MFS Total Return Portfolio 512,047 50,745
Utility Portfolio 305,496 14,974
Worldwide High Income Portfolio 287,429 382,386
High-Yield Bond Portfolio 2,555,432 117,213
Global Bond Portfolio 215,278 89,681
Corporate Bond Portfolio 146,905 49,143
International Growth & Income Portfolio 1,241,329 93,039
Emerging Markets Portfolio 258,841 51,845
Real Estate Portfolio 63,065 13,322
"Dogs" of Wall Street Portfolio 141,292 2,333
MFS Mid-Cap Growth Portfolio 439,507 65,306
Cash Management Portfolio 3,177,377 2,953,476
</TABLE>
8
<PAGE> 65
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
INVESTMENT IN ANCHOR TRUST AND SUNAMERICA TRUST (continued)
The aggregate cost of the Trusts' shares acquired and the aggregate
proceeds from shares sold during the year ended November 30, 1999
consist of the following:
<TABLE>
<CAPTION>
Cost of Shares Proceeds from
Variable Accounts Acquired Shares Sold
----------------- -------------- -------------
<S> <C> <C>
ANCHOR TRUST:
Capital Appreciation Portfolio $ 8,727,873 $ 2,361,829
Growth Portfolio 6,053,896 1,012,160
Natural Resources Portfolio 849,013 430,778
Government and Quality Bond Portfolio 8,395,757 5,333,553
SUNAMERICA TRUST:
International Diversified Equities Portfolio 3,340,274 3,036,315
Global Equities Portfolio 3,956,498 2,303,417
Aggressive Growth Portfolio 5,378,260 1,300,534
Venture Value Portfolio 10,417,023 3,149,130
Federated Value Portfolio 2,724,188 670,651
Provident Growth Portfolio 10,400,936 896,675
MFS Growth & Income Portfolio 7,308,308 606,129
Alliance Growth Portfolio 37,164,387 2,979,571
Growth-Income Portfolio 23,421,092 1,893,475
Asset Allocation Portfolio 5,015,871 3,305,010
SunAmerica Balanced Portfolio 10,413,786 1,078,827
MFS Total Return Portfolio 4,541,926 277,324
Utility Portfolio 1,404,718 348,400
Worldwide High Income Portfolio 5,263,643 4,411,112
High-Yield Bond Portfolio 10,959,783 11,170,218
Global Bond Portfolio 1,883,180 575,408
Corporate Bond Portfolio 2,618,128 1,144,658
International Growth & Income Portfolio 4,086,938 1,935,185
Emerging Markets Portfolio 1,669,743 520,369
Real Estate Portfolio 774,217 688,941
"Dogs" of Wall Street Portfolio 81,270 5,780
MFS Mid-Cap Growth Portfolio 904,054 146
Cash Management Portfolio 28,575,858 23,698,036
</TABLE>
9
<PAGE> 66
FS VARIABLE SEPARATE ACCOUNT
OF
FIRST SUNAMERICA LIFE INSURANCE COMPANY
NOTES TO FINANCIAL STATEMENTS
4. FEDERAL INCOME TAXES
The Company qualifies for federal income tax treatment granted to life
insurance companies under subchapter L of the Internal Revenue Service
Code (the "Code"). The operations of the Separate Account are part of
the total operations of the Company and are not taxed separately. The
Separate Account is not treated as a regulated investment company under
the Code.
5. FISCAL YEAR CHANGE
Effective December 31, 1999, the Separate Account changed its fiscal
year end from November 30 to December 31. Accordingly, the financial
statements included the results of operations for the transition period,
which are not necessarily indicative of operations for a full year.
Results for the comparable prior period are summarized below.
<TABLE>
<CAPTION>
One Month Ended
December 31, 1998
-----------------
<S> <C>
Investment income $ 67,783
Net investment income (loss) (303,854)
Net realized gains (losses)
from securities transactions 34,977
Change in net unrealized appreciation (depreciation)
of investments 16,953,775
-----------
Increase (decrease) in net assets from operations $16,684,898
===========
</TABLE>
10
<PAGE> 67
PART C - OTHER INFORMATION
Item 24. Financial Statements and Exhibits
- ----------------------------------------------
(a) Financial Statements
- ---------------------------
The following financial statements are included in Part B of the
Registration Statement:
Audited Financial Statements of First SunAmerica Life Insurance
Company for the fiscal year ended September 30, 1998.
[Incorporated by Reference]
Audited Transition Report of First SunAmerica Life Insurance
Company as of and for the three months ended December 31, 1998.
[Incorporated by Reference]
Audited Financial Statements of FS Variable Separate Account for
the one month ended December 31, 1999 and for the fiscal year
ended November 30, 1999.
<TABLE>
<CAPTION>
(b) Exhibits
- ----------------
<S> <C>
(1) Resolutions Establishing Separate Account......***
(2) Custody Agreements ............................**
(3) (a) Distribution Contract......................***
(b) Selling Agreement..........................***
(4) Variable Annuity Contract......................****
(5) Application for Contract.......................****
(6) Depositor - Corporate Documents
(a) Certificate of Incorporation ...........***
(b) By-Laws.................................***
(7) Reinsurance Contract ..........................**
(8) Fund Participation Agreement...................***
(9) Opinion of Counsel.............................***
Consent of Counsel.............................***
(10) Consent of Independent Accountants.............*
(11) Financial Statements Omitted from Item 23......**
(12) Initial Capitalization Agreement...............**
(13) Performance Computations ......................**
(14) Diagram and Listing of All Persons Directly or
Indirectly Controlled By or Under Common
Control With First SunAmerica Life Insurance
Company, the Depositor of Registrant...........*****
(15) Powers of Attorney.............................***
* Filed Herewith
** Not Applicable
*** Filed January 30, 1998, Post-Effective Amendments 5 and 7
to this Registration Statement
**** Filed March 31, 1998, Post-Effective Amendments 6 and 8
to this Registration Statement
***** Filed March 25, 1999, Post-Effective Amendments 10 and 12
to this Registration Statement
</TABLE>
Item 25. Directors and Officers of the Depositor
- -------------------------------------------------
The officers and directors of First SunAmerica Life Insurance Company
are listed below. Their principal business address is 1 SunAmerica Center, Los
Angeles, California 90067-6022, unless otherwise noted.
<TABLE>
<CAPTION>
Name Position
- ---- --------
<S> <C>
Eli Broad Chairman, President and
Chief Executive Officer
Jay S. Wintrob Director and Executive
Vice President
Thomas W. Baxter(1) Director
Vicki E. Marmorstein(2) Director
Debbie Potash-Turner(3) Director
Lester Pollack(4) Director
Richard D. Rohr(5) Director
Margery K. Neale (6) Director
Marc H. Gamsin Director and Senior Vice President
Jana W. Greer Director and Senior Vice President
James R. Belardi Director and Senior Vice President
</TABLE>
<PAGE> 68
<TABLE>
<CAPTION>
<S> <C>
Susan L. Harris Director, Senior Vice President and
Secretary
N. Scott Gillis Director and Senior Vice President
Edwin R. Raquel Senior Vice President and Chief Actuary
Gregory M. Outcalt Senior Vice President and Controller
Scott H. Richland Vice President
David Bechtel Vice President and Treasurer
P. Daniel Demko, Jr. Vice President
Kevin J. Hart Vice President
Stewart R. Polakov Vice President
</TABLE>
<PAGE> 69
- ----------------
(1) 400 South Hope Street, 15th Floor, Los Angeles, California 90071
(2) 633 West Fifth Street, Suite 400, Los Angeles, California 90071
(3) 733 Third Avenue, 3rd Floor, New York, New York 10017
(4) One Rockefeller Plaza, Suite 1025, New York, New York 10020
(5) 100 Renaissance Center, 34th Floor, Detroit, Michigan 48243
(6) 919 Third Avenue, New York, New York 10022-9998
Item 26. Persons Controlled By or Under Common Control With Depositor or
- -------------------------------------------------------------------------
Registrant
- ----------
The Registrant is a separate account of First SunAmerica Life Insurance
Company (Depositor). For a complete listing and diagram of all persons directly
or indirectly controlled by or under common control with First SunAmerica Life
Insurance Company, the Depositor of Registrant, see Exhibit 14 of the Initial
Registration Statement of Variable Annuity Account Seven and Anchor National
Life Insurance Company, an affiliate of Registrant, (File Nos. 333-65965 and
811-09003)(N-4) and (333-65953)(S-1), which is incorporated herein by reference.
As of January 4, 1999, First SunAmerica became an indirect wholly-owned
subsidiary of American International Group, Inc. ("AIG"). An organizational
chart for AIG can be found in Form 10-K, SEC file number 001-08787 filed March
31, 1999.
Item 27. Number of Contract Owners
- ------------------------------------
As of December 31, 1999, the number of Contracts funded by the FS
Variable Separate Account of First SunAmerica Life Insurance Company was 8,587,
of which 3,938 were Qualified Contracts and 4,649 were Nonqualified Contracts.
Item 28. Indemnification
- -------------------------
None.
Item 29. Principal Underwriter
- --------------------------------
SunAmerica Capital Services, Inc. serves as distributor to the
Registrant, Presidential Variable Account One, Variable Separate Account,
Variable Annuity Account One, FS Variable Annuity Account One, Variable Annuity
Account Four, Variable Annuity Account Five and Variable Annuity Account Seven.
SunAmerica Capital Services, Inc. also serves as the underwriter to the
SunAmerica Income Funds, SunAmerica Equity Funds, SunAmerica Money Market Funds,
Inc., Style Select Series, Inc. and the SunAmerica Strategic Investment Series,
Inc., all issued by SunAmerica Asset Management Corp.
Its principal business address is 733 Third Avenue, 4th Floor, New York,
New York 10017. The following are the directors and officers of SunAmerica
Capital Services, Inc.
<TABLE>
<CAPTION>
<S> <C>
Name Position with Distributor
---- -------------------------
J. Steven Neamtz Director and President
Robert M. Zakem Director, Executive
Vice President, General Counsel
and Assistant Secretary
Peter Harbeck Director
James Nichols Vice President
Susan L. Harris Secretary
Debbie Potash-Turner Controller
Net
Distribution Compensation
Name of Discounts and on Redemption Brokerage
Distributor Commissions Annuitization Commission Commissions*
- ------------ ------------- ------------- ----------- ------------
SunAmerica None None None None
Capital
Services, Inc.
</TABLE>
- ---------------
* Distribution fee is paid by First SunAmerica Life Insurance Company.
Item 30. Location of Accounts and Records
- --------------------------------------------
<PAGE> 70
First SunAmerica Life Insurance Company, the Depositor for the
Registrant, is located at 733 Third Avenue, 4th Floor, New York, New York 10017.
SunAmerica Capital Services, Inc., the distributor of the Contracts, is located
at 733 Third Avenue, 4th Floor, New York, New York 10017. Each maintains those
accounts and records required to be maintained by it pursuant to Section 31(a)
of the Investment Company Act and the rules promulgated thereunder.
State Street Bank and Trust Company, 225 Franklin Street, Boston,
Massachusetts 02100, maintains certain accounts and records pursuant to the
instructions of the Registrant.
<PAGE> 71
Item 31. Management Services
- -----------------------------
Not Applicable.
Item 32. Undertakings
- ----------------------
Registrant undertakes to (1) file post-effective amendments to this
Registration Statement as frequently as is necessary to ensure that the audited
financial statements in the Registration Statement are never more than 16 months
old for so long as payments under the variable annuity Contracts may be
accepted; (2) include either (A) as part of any application to purchase a
Contract offered by the prospectus forming a part of the Registration Statement,
a space that an applicant can check to request a Statement of Additional
Information, or (B) a postcard or similar written communication affixed to or
included in the Prospectus that the Applicant can remove to send for a Statement
of Additional Information; and (3) deliver any Statement of Additional
Information and any financial statements required to be made available under
this Form N-4 promptly upon written or oral request.
Item 33. Representation
- ------------------------
(a) The Company hereby represents that it is relying upon a No-Action
Letter issued to the American Council of Life Insurance dated November
28, 1988 (Commission ref. IP-6-88) and that the following provisions
have been complied with:
1. Include appropriate disclosure regarding the redemption restrictions
imposed by Section 403(b)(11) in each registration statement, including
the prospectus, used in connection with the offer of the contract;
2. Include appropriate disclosure regarding the redemption restrictions
imposed by Section 403(b)(11) in any sales literature used in connection
with the offer of the contract;
3. Instruct sales representatives who solicit participants to purchase the
contract specifically to bring the redemption restrictions imposed by
Section 403(b)(11) to the attention of the potential participants;
4. Obtain from each plan participant who purchases a Section 403(b) annuity
contract, prior to or at the time of such purchase, a signed statement
acknowledging the participant's understanding of (1) the restrictions on
redemption imposed by Section 403(b)(11), and (2) other investment
alternatives available under the employer's Section 403(b) arrangement
to which the participant may elect to transfer his contract value.
(b) REPRESENTATION PURSUANT TO SECTION 26(e) OF THE INVESTMENT COMPANY ACT
OF 1940: The Company represents that the fees and charges to be deducted
under the variable annuity contract described in the prospectus
contained in this registration statement are, in the aggregate,
reasonable in relation to the services rendered, the expenses expected
to be incurred, and the risks assumed in connection with the contract.
<PAGE> 72
SIGNATURES
As required by the Securities Act of 1933 and the Investment Company Act
of 1940, the Registrant certifies that it meets the requirements of Securities
Act Rule 485 for effectiveness of this Registration Statement and has caused
this Post-Effective Amendment to the Registration Statement to be signed on its
behalf, in the City of Los Angeles, and the State of California, on this 20th
day of March 2000.
FS VARIABLE SEPARATE ACCOUNT
(Registrant)
By: FIRST SUNAMERICA LIFE INSURANCE COMPANY
(Depositor)
By: /S/ JAY S. WINTROB
----------------------------------------------
Jay S. Wintrob
Executive Vice President
By: FIRST SUNAMERICA LIFE INSURANCE COMPANY
(Depositor, on behalf of itself and Registrant)
By: /S/ JAY S. WINTROB
----------------------------------------------
Jay S. Wintrob
Executive Vice President
As required by the Securities Act of 1933, this Post-Effective Amendment
to the Registration Statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURE TITLE DATE
--------- ----- ----
<S> <C> <C>
ELI BROAD* President, Chief Executive
- --------------------- Officer, & Chairman of
Eli Broad Board (Principal Executive Officer)
MARC H. GAMSIN* Senior Vice President
- --------------------- & Director
Marc H. Gamsin
N. SCOTT GILLIS* Senior Vice President
- --------------------- & Director
N. Scott Gillis
JAMES R. BELARDI* Director
- ---------------------
James R. Belardi
DAVID W. FERGUSON* Director
- ---------------------
David W. Ferguson
MARGERY K. NEALE* Director
- ---------------------
Margery K. Neale
JANA W. GREER* Director
- ---------------------
Jana W. Greer
</TABLE>
<PAGE> 73
<TABLE>
<CAPTION>
<S> <C> <C>
THOMAS A. HARNETT* Director
- ---------------------
Thomas A. Harnett
JAY S. WINTROB* Director
- ---------------------
Jay S. Wintrob
/S/ SUSAN L. HARRIS Director March 20, 2000
- ---------------------
Susan L. Harris
LESTER POLLACK* Director
- ---------------------
Lester Pollack
RICHARD D. ROHR* Director
- ---------------------
Richard D. Rohr
*By: /S/ SUSAN L. HARRIS Attorney-in-Fact
--------------------
Susan L. Harris
Date: March 20, 2000
</TABLE>
** KNOW ALL PERSONS BY THESE PRESENTS, that the person whose signature appears
below hereby constitutes and appoints SUSAN L. HARRIS AND CHRISTINE A. NIXON or
each of them, as his true and lawful attorneys-in-fact and agents, with full
power of substitution and resubstitution, for him and in his name, place and
stead, in any and all capacities, to sign any and all amendments (including
post-effective amendments) to this Registration Statement, and to file the
same, with all exhibits thereto, and other documents in connection therewith,
as fully to all intents as he might or could do in person, including
specifically, but without limiting the generality of the foregoing, to (i) take
any action to comply with any rules, regulations or requirements of the
Securities and Exchange Commission under the federal securities laws; (ii) make
application for and secure any exemptions from the federal securities laws;
(iii) register additional annuity contracts under the federal securities laws,
if registration is deemed necessary. The undersigned hereby ratifies and
confirms all that said attorneys-in-fact and agents or any of them, or their
substitutes, shall do or cause to be done by virtue thereof.
<TABLE>
<S> <C> <C>
**/s/ GREGORY M. OUTCALT Senior Vice President March 20, 2000
- ------------------------ and Controller
Gregory M. Outcalt
</TABLE>
<PAGE> 74
EXHIBIT INDEX
Exhibit Description
- ------- ------------
Exhibit 10 Consent of Independent Accountants
<PAGE> 1
CONSENT OF INDEPENDENT ACCOUNTANTS
We hereby consent to the incorporation by reference in the Statement of
Additional Information constituting part of this Registration Statement
on Form N-4 for FS Variable Separate Account of First SunAmerica Life
Insurance Company of our report dated November 19, 1999 and November 9,
1998, relating to the financial statements of First SunAmerica Life
Insurance Company, and the use of our report dated March 3, 2000,
relating to the financial statements of FS Variable Separate Account,
which appear in such Statement of Additional Information. We also
consent to the incorporation by reference of our report dated November
9, 1998, relating to the financial statements of First SunAmerica Life
Insurance Company, into the Prospectus which constitutes part of this
Registration Statement. We also consent to the reference to us under the
heading "Financial Statements" in such Statement of Additional
Information and to the reference to us under the heading "Independent
Accountants" in such Prospectus.
PricewaterhouseCoopers LLP
Los Angeles, California
March 20, 1999
