[LOGO]
LIFEUSA
FUNDS
SEMI-ANNUAL REPORT
JUNE 30, 1998
(UNAUDITED)
<PAGE>
TABLE OF CONTENTS
LIFEUSA FUNDS, INC.
SEMI-ANNUAL REPORT
JUNE 30, 1998
(UNAUDITED)
President's Letter............................. 2
Portfolio Reviews
LifeUSA Aggressive Growth Portfolio......... 3
LifeUSA Growth Portfolio.................... 4
LifeUSA Global Portfolio.................... 5
LifeUSA Balanced Portfolio.................. 6
LifeUSA Current Income Portfolio............ 7
LifeUSA Principal Preservation Portfolio.... 8
Schedules of Investments
LifeUSA Aggressive Growth Portfolio......... 9
LifeUSA Growth Portfolio.................... 9
LifeUSA Global Portfolio................... 10
LifeUSA Balanced Portfolio................. 10
LifeUSA Current Income Portfolio........... 11
LifeUSA Principal Preservation Portfolio... 11
Notes to Schedules of Investments............. 12
Statements of Assets and Liabilities.......... 13
Statements of Operations...................... 15
Statements of Changes in Net Assets
LifeUSA Aggressive Growth Portfolio........ 17
LifeUSA Growth Portfolio................... 18
LifeUSA Global Portfolio................... 19
LifeUSA Balanced Portfolio................. 20
LifeUSA Current Income Portfolio........... 21
LifeUSA Principal Preservation Portfolio... 22
Financial Highlights
LifeUSA Aggressive Growth Portfolio........ 23
LifeUSA Growth Portfolio................... 24
LifeUSA Global Portfolio................... 25
LifeUSA Balanced Portfolio................. 26
LifeUSA Current Income Portfolio........... 27
LifeUSA Principal Preservation Portfolio... 28
Notes to Financial Statements................. 29
Distributor, Adviser, Legal Counsel,
Independent Auditors, Directors....... Back Cover
<PAGE>
PRESIDENT'S LETTER
LIFEUSA FUNDS, INC.
WHAT'S RIGHT WITH THIS MARKET
The stock market has been on a roller coaster of late, and that naturally makes
people uneasy. But if you're a long-term investor, then I would argue that there
are a lot more good things influencing the market than bad things.
True, U.S. corporate earnings are flattening out, and that's putting a damper on
the stock market. When you buy a stock, you're buying a future stream of
dividends as well as a stronger company because most of the profits are being
reinvested. After double-digit growth during much of the 1990s, profits in 1998
are growing in the low single digits. A major reason why profits are sluggish is
the economic and currency turmoil in Asia, which hurts U.S. companies doing
business there.
Another reason for sluggish profit growth is the great job that Corporate
America has done to become more efficient. After years of cost-cutting, there
isn't much cutting left to do. To enhance profits, companies must either boost
prices or sell more products and services. But with inflation at virtually zero,
it's tough to raise prices. So, profit growth must come through increased unit
volume.
And that's where the good news is likely to begin. Even with the dampening
effects of Asia, the U.S. economy is still basically healthy, making it possible
for U.S. corporations to sell more products and services here at home. True,
we're losing business in Asia, because the dollar is so strong compared to their
currencies. But what we're losing in Asia, we're gaining in Europe, as that
region of the world begins to enjoy U.S.-style prosperity. Europe will look even
stronger once the euro, the Continent's single currency, begins to replace 11
currencies on January 1, 1999.
Asia has helped keep inflation worries away, and that has kept interest rates
low. Recently, the 30-year Treasury bond yield reached its lowest level ever, as
global investors buy our securities for the greatest safety and liquidity.
Partly because of our low inflation environment, worldwide demand for U.S.
stocks and bonds continues to be strong.
Even if 1998 turns out to be a mediocre year for stocks, let's not feel too
sorry for ourselves. The Dow Jones Industrial Average has more than doubled
since 1995 and virtually tripled since the beginning of this decade. Where was
the Dow in 1982? 800! Has your house gone up by a factor of ten in fifteen
years? Probably not. The point is that markets do not go up in a straight line,
and there is bound to be volatility. But if you're an investor for the long
term, then you should be able to step back and see the good in this market.
We hope that you read the Portfolio Managers' Reviews which follow this letter.
They offer a detailed perspective on the individual funds' performance and
strategy. As always, we appreciate your continued trust and confidence in IAI.
If there is any way that we can serve you better, please let us know by calling
our toll-free Investor Services Hotline at 1-800-945-3863.
SINCERELY,
/s/ Roy C. Gillson
Roy C. Gillson
President
2
<PAGE>
PORTFOLIO REVIEW
LIFEUSA AGGRESSIVE GROWTH PORTFOLIO
LIFEUSA AGGRESSIVE GROWTH PORTFOLIO
HOW HAS THE PORTFOLIO PERFORMED?
The LifeUSA Aggressive Growth Portfolio has had a net asset value total return
of 11.57% for the six months ended June 30, 1998. The Russell 2500 Index has
returned 5.66% over the same time period. The Portfolio consists mainly of small
cap stocks. While small caps rallied in the first quarter of 1998, the "Asian
Flu" returned to the stock market during the second quarter. This gave investors
another reason to retreat to bonds and large-cap stocks, leading to a decline in
the fortunes of small company stocks.
WHAT IS YOUR OUTLOOK FOR THE PORTFOLIO?
We have approached 1998 cautiously, believing that the "Asian Flu" could be the
catalyst for weaker corporate profits in many sectors. However, we believe the
Portfolio consists of well-positioned companies with sustainable competitive
advantages in stable, growing markets. Thus, we are optimistic about the outlook
for strong relative performance regardless of the environment.
VALUE OF $10,000 INVESTMENT+
[PLOT POINTS CHART]
LIFEUSA
AGGRESSIVE GROWTH
PORTFOLIO (POP) RUSSELL 2500
(Inception 2/03/97) INDEX*
------------------- ------
2/03/97 $ 9,425 $10,000
3/31/97 8,699 9,405
6/30/97 10,329 10,826
9/30/97 11,724 12,380
12/31/97 11,121 12,101
3/31/98 12,278 13,343
6/30/98 12,409 12,787
TOTAL RETURNS+
THROUGH 6/30/98
Since Inception
Six months*** 1 Year 2/03/97**
- --------------------------------------------------------------------------------
LIFEUSA AGGRESSIVE GROWTH PORTFOLIO -
PUBLIC OFFERING PRICE 5.16% 13.22% 16.63%
- --------------------------------------------------------------------------------
LIFEUSA AGGRESSIVE GROWTH PORTFOLIO -
NET ASSET VALUE 11.57% 20.12% 21.66%
- --------------------------------------------------------------------------------
Russell 2500 Index 5.66% 18.10% 18.95%*
- --------------------------------------------------------------------------------
+ AS YOU COMPARE PERFORMANCE, PLEASE NOTE THAT THE LIFEUSA AGGRESSIVE GROWTH
PORTFOLIO'S--PUBLIC OFFERING PRICE (POP) PERFORMANCE REFLECTS THE MAXIMUM
5.75% SALES CHARGE. THE LIFEUSA AGGRESSIVE GROWTH PORTFOLIO'S--NET ASSET
VALUE (NAV) PERFORMANCE DOES NOT REFLECT ANY SUCH CHARGES NOR DOES THE
PERFORMANCE OF THE RUSSELL 2500 INDEX. PAST PERFORMANCE IS NOT PREDICTIVE
OF FUTURE PERFORMANCE.
* SINCE 2/01/97
** ANNUALIZED
*** NOT ANNUALIZED
3
<PAGE>
PORTFOLIO REVIEW
LIFEUSA GROWTH PORTFOLIO
LIFEUSA GROWTH PORTFOLIO
HOW HAS THE PORTFOLIO PERFORMED?
The LifeUSA Growth Portfolio has had a net asset value total return of 11.67%
for the six months ended June 30, 1998. The S&P 500 Index has returned 17.71%
over the same time period. Robust economic growth, low inflation and corporate
profit expansion led the stock market to strong absolute returns in the first
quarter of 1998. However, Asian economic events led investors to seek the safety
and liquidity offered by the large blue chip stocks. Smaller and midcap stocks
have not fared as well in this environment.
WHAT IS YOUR OUTLOOK FOR THE PORTFOLIO?
The economic environment remains very favorable. Modest economic growth, low
inflation, and low interest rates continue to support stocks. Slower earnings
growth due to Asian turmoil may materialize later this year. If this does occur,
we believe investors will be attracted to the high quality, consistent growth
companies that comprise the majority of the Portfolio.
VALUE OF $10,000 INVESTMENT+
[PLOT POINTS CHART]
LIFEUSA GROWTH
PORTFOLIO (POP) S&P 500
(Inception 2/03/97) INDEX*
------------------- ------
2/03/97 $ 9,425 $10,000
3/31/97 8,747 9,661
6/30/97 9,765 11,347
9/30/97 10,593 12,210
12/31/97 10,463 12,556
3/31/98 11,520 14,308
6/30/98 11,684 14,781
TOTAL RETURNS+
THROUGH 6/30/98
Since Inception
Six months*** 1 Year 2/03/97**
- -------------------------------------------------------------------------------
LIFEUSA GROWTH PORTFOLIO -
PUBLIC OFFERING PRICE 5.25% 12.78% 11.74%
- -------------------------------------------------------------------------------
LIFEUSA GROWTH PORTFOLIO -
NET ASSET VALUE 11.67% 19.66% 16.55%
- -------------------------------------------------------------------------------
S&P 500 Index 17.71% 30.16% 31.72%*
- -------------------------------------------------------------------------------
+ AS YOU COMPARE PERFORMANCE, PLEASE NOTE THAT THE LIFEUSA GROWTH
PORTFOLIO'S--PUBLIC OFFERING PRICE (POP) PERFORMANCE REFLECTS THE MAXIMUM
5.75% SALES CHARGE. THE LIFEUSA GROWTH PORTFOLIO'S--NET ASSET VALUE (NAV)
PERFORMANCE DOES NOT REFLECT ANY SUCH CHARGES NOR DOES THE PERFORMANCE OF
THE S&P 500 INDEX. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE
PERFORMANCE.
* SINCE 2/01/97
** ANNUALIZED
*** NOT ANNUALIZED
4
<PAGE>
PORTFOLIO REVIEW
LIFEUSA GLOBAL PORTFOLIO
LIFEUSA GLOBAL PORTFOLIO
HOW HAS THE PORTFOLIO PERFORMED?
The LifeUSA Global Portfolio has had a net asset value total return of 6.93% for
the six months ended June 30, 1998. The S&P 500 Index has returned 17.71%, and
the EAFE Index has returned 16.08% over the same time period. International
equity markets were mixed in the second quarter of 1998. Continuing weakness of
the yen and concerns over the Japanese banking system provided a catalyst for
further declines in the Asian markets. In contrast, European equity markets
continued their rally as investors sought shelter in a region seen as relatively
safe. Emerging markets were negatively impacted by the Asian crisis.
WHAT IS YOUR OUTLOOK FOR THE PORTFOLIO?
Following the recent setback, Asian markets have reached attractive levels of
valuation. Continental European economies are recovering, influenced by capital
investment and increased consumer spending.
VALUE OF $10,000 INVESTMENT+
[PLOT POINTS CHART]
LIFEUSA GLOBAL
PORTFOLIO (POP) S&P 500 EAFE
(Inception 2/03/97) INDEX* INDEX*
------------------- ------ ------
2/03/97 $ 9,425 $10,000 $10,000
3/31/97 9,397 9,661 10,205
6/30/97 10,377 11,347 11,538
9/30/97 10,377 12,210 11,464
12/31/97 9,597 12,556 10,573
3/31/98 10,711 14,308 12,137
6/30/98 10,262 14,781 12,274
TOTAL RETURNS+
THROUGH 6/30/98
Since Inception
Six months*** 1 Year 2/03/97**
- -------------------------------------------------------------------------------
LIFEUSA GLOBAL PORTFOLIO -
PUBLIC OFFERING PRICE 0.78% (6.79)% 1.87%
- -------------------------------------------------------------------------------
LIFEUSA GLOBAL PORTFOLIO -
NET ASSET VALUE 6.93% (1.09)% 6.26%
- -------------------------------------------------------------------------------
S&P 500 Index 17.71% 30.16% 31.72%*
- -------------------------------------------------------------------------------
EAFE Index 16.08% 6.38% 15.56%*
- -------------------------------------------------------------------------------
+ AS YOU COMPARE PERFORMANCE, PLEASE NOTE THAT THE LIFEUSA GLOBAL
PORTFOLIO'S--PUBLIC OFFERING PRICE (POP) PERFORMANCE REFLECTS THE MAXIMUM
5.75% SALES CHARGE. THE LIFEUSA GLOBAL PORTFOLIO'S--NET ASSET VALUE (NAV)
PERFORMANCE DOES NOT REFLECT ANY SUCH CHARGES NOR DOES THE PERFORMANCE OF
THE S&P 500 OR EAFE INDICES. PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE
PERFORMANCE.
* SINCE 2/01/97
** ANNUALIZED
*** NOT ANNUALIZED
5
<PAGE>
PORTFOLIO REVIEW
LIFEUSA BALANCED PORTFOLIO
LIFEUSA BALANCED PORTFOLIO
HOW HAS THE PORTFOLIO PERFORMED?
The LifeUSA Balanced Portfolio has had a net asset value total return of 7.91%
for the six months ended June 30, 1998. The S&P 500 Index has returned 17.71%,
the Lehman Brothers Aggregate Bond Index has returned 3.93%, and the EAFE Index
has returned 16.08% over the same time period. Asian economic events led
investors to seek the safety and liquidity offered by the large blue chip stocks
during the first half of the year. Smaller and midcap stocks have not fared as
well in this environment. The interest sensitivity of the Portfolio was extended
during the second quarter to reflect our favorable outlook on interest rates in
the near term. Asian markets declined, while European equity markets continued
their rally as investors sought shelter in a region seen as relatively safe.
WHAT IS YOUR OUTLOOK FOR THE PORTFOLIO?
We continue to focus on companies with solid competitive advantages and
extremely high financial quality at attractive fundamental valuations. Companies
with these characteristics possess the strength and flexibility to weather
downturns in the economy and capital markets that should lead to strong relative
performance in weak markets and out-performance over a full market cycle.
VALUE OF $10,000 INVESTMENT+
[PLOT POINTS CHART]
LIFEUSA BALANCED LEHMAN BROS.
PORTFOLIO (POP) S&P 500 AGGREGATE EAFE
(Inception 2/03/97) INDEX* BOND INDEX* INDEX*
------------------- ------ ----------- ------
2/03/97 $ 9,425 $10,000 $10,000 $10,000
3/31/97 9,237 9,661 9,914 10,205
6/30/97 9,972 11,347 10,278 11,538
9/30/97 10,452 12,210 10,619 11,464
12/31/97 10,206 12,556 10,932 10,573
3/31/98 10,892 14,308 11,021 12,137
6/30/98 11,013 14,781 11,278 12,274
TOTAL RETURNS+
THROUGH 6/30/98
Since Inception
Six months*** 1 Year 2/03/97**
- --------------------------------------------------------------------------------
LIFEUSA BALANCED PORTFOLIO -
PUBLIC OFFERING PRICE 1.70% 4.09% 7.13%
- --------------------------------------------------------------------------------
LIFEUSA BALANCED PORTFOLIO -
NET ASSET VALUE 7.91% 10.46% 11.75%
- --------------------------------------------------------------------------------
S&P 500 Index 17.71% 30.16% 31.72%*
- --------------------------------------------------------------------------------
Lehman Brothers Aggregate Bond Index 3.93% 10.54% 9.43%*
- --------------------------------------------------------------------------------
EAFE Index 16.08% 6.38% 15.56%*
- --------------------------------------------------------------------------------
+ AS YOU COMPARE PERFORMANCE, PLEASE NOTE THAT THE LIFEUSA BALANCED
PORTFOLIO'S--PUBLIC OFFERING PRICE (POP) PERFORMANCE REFLECTS THE MAXIMUM
5.75% SALES CHARGE. THE LIFEUSA BALANCED PORTFOLIO'S--NET ASSET VALUE (NAV)
PERFORMANCE DOES NOT REFLECT ANY SUCH CHARGES NOR DOES THE PERFORMANCE OF
THE S&P 500, LEHMAN BROTHERS AGGREGATE BOND OR EAFE INDICES. PAST
PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
* SINCE 2/01/97
** ANNUALIZED
*** NOT ANNUALIZED
6
<PAGE>
PORTFOLIO REVIEW
LIFEUSA CURRENT INCOME PORTFOLIO
LIFEUSA CURRENT INCOME PORTFOLIO
HOW HAS THE PORTFOLIO PERFORMED?
The LifeUSA Current Income Portfolio has had a net asset value total return of
3.76% for the six months ended June 30, 1998. The Lehman Brothers Aggregate Bond
Index has returned 3.93% over the same time period. The focus of the Portfolio
was on sector and issue selection during the first half of the year. The
overweighting in both Mortgages and Corporates was extended late in the period
as spreads for these sectors vs. Treasuries had widened, providing better value.
The interest sensitivity of the Fund was extended during the second quarter
reflecting our favorable outlook for interest rates in the near-term.
WHAT IS YOUR OUTLOOK FOR THE PORTFOLIO?
Looking ahead, the near-term trends look favorable for bonds. US economic growth
should moderate this summer in response to slower production, reduced inventory
accumulation and rising imports. Soft commodity prices and Asian instability
will keep inflation expectations in check. Federal Reserve policy will remain on
hold. We have positioned the Fund to benefit from these factors.However, we see
risks for the market beyond the summer months. Inflation isn't dead. Falling
commodity prices are currently masking a rising trend of service-based inflation
in such areas as housing rental and medical care. The Fed may need to take
action later in the year. As evidence of these events materialize, the Fund will
be repositioned in a more defensive mode.
VALUE OF $10,000 INVESTMENT+
[PLOT POINTS CHART]
LIFEUSA CURRENT LEHMAN BROS.
INCOME PORTFOLIO (POP) AGGREGATE
(Inception 2/03/97) BOND INDEX*
------------------- -----------
2/03/97 $ 9,425 $10,000
3/31/97 9,302 9,914
6/30/97 9,622 10,278
9/30/97 9,942 10,619
12/31/97 10,167 10,932
3/31/98 10,330 11,021
6/30/98 10,551 11,278
TOTAL RETURNS+
THROUGH 6/30/98
Since Inception
Six months*** 1 Year 2/03/97**
- --------------------------------------------------------------------------------
LIFEUSA CURRENT INCOME PORTFOLIO -
PUBLIC OFFERING PRICE (2.19)% 3.35% 3.90%
- --------------------------------------------------------------------------------
LIFEUSA CURRENT INCOME PORTFOLIO -
NET ASSET VALUE 3.76% 9.65% 8.38%
- --------------------------------------------------------------------------------
Lehman Brothers Aggregate Bond Index 3.93% 10.54% 9.43%*
- --------------------------------------------------------------------------------
+ AS YOU COMPARE PERFORMANCE, PLEASE NOTE THAT THE LIFEUSA CURRENT INCOME
PORTFOLIO'S--PUBLIC OFFERING PRICE (POP) PERFORMANCE REFLECTS THE MAXIMUM
5.75% SALES CHARGE. THE LIFEUSA CURRENT INCOME PORTFOLIO'S--NET ASSET VALUE
(NAV) PERFORMANCE DOES NOT REFLECT ANY SUCH CHARGES NOR DOES THE
PERFORMANCE OF THE LEHMAN BROTHERS AGGREGATE BOND INDEX. PAST PERFORMANCE
IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
* SINCE 2/01/97
** ANNUALIZED
*** NOT ANNUALIZED
7
<PAGE>
PORTFOLIO REVIEW
LIFEUSA PRINCIPAL PRESERVATION PORTFOLIO
LIFEUSA PRINCIPAL PRESERVATION PORTFOLIO
HOW HAS THE PORTFOLIO PERFORMED?
The LifeUSA Principal Preservation Portfolio has had a total return of 2.21% for
the six months ended June 30, 1998. The Lipper Money Market Fund Average has
returned 2.44% over the same time period. Short-term interest rates increased
very slightly during the quarter. One month commercial paper is now earning
annualized returns of about 5.54%.
WHAT IS YOUR OUTLOOK FOR THE PORTFOLIO?
Near-term trends look favorable for long bonds. Soft commodity prices and Asian
instability will keep inflation expectations in check. Federal Reserve policy
will remain on hold. However, we see risks for the market beyond the summer
months. Inflation isn't dead. Falling commodity prices are currently masking a
rising trend of service-based inflation in such areas as housing rental and
medical care. The Fed may need to take action later in the year. The Fund should
continue to earn returns similar to those shown above until the Fed is forced to
raise rates.
VALUE OF $10,000 INVESTMENT+
[PLOT POINTS CHART]
LIFEUSA PRINCIPAL LIPPER MONEY
PRESERVATION PORTFOLIO MARKET FUND
(Inception 2/03/97) AVERAGE*
------------------- --------
2/03/97 $10,000 $10,000
3/31/97 10,066 10,066
6/30/97 10,179 10,179
9/30/97 10,293 10,300
12/31/97 10,414 10,427
3/31/98 10,522 10,577
6/30/98 10,643 10,724
TOTAL RETURNS+
THROUGH 6/30/98
Since Inception
Six months*** 1 Year 2/03/97**
- --------------------------------------------------------------------------------
LIFEUSA PRINCIPAL PRESERVATION PORTFOLIO - 2.21% 4.56% 4.54%
- --------------------------------------------------------------------------------
Lipper Money Market Fund Average 2.44% 4.95% 4.90%*
- --------------------------------------------------------------------------------
+ PAST PERFORMANCE IS NOT PREDICTIVE OF FUTURE PERFORMANCE.
* SINCE 2/01/97
** ANNUALIZED
*** NOT ANNUALIZED
8
<PAGE>
================================================================================
SCHEDULES OF INVESTMENTS
================================================================================
LIFEUSA FUNDS, INC.
JUNE 30, 1998
(PERCENTAGE FIGURES INDICATE PERCENTAGE OF TOTAL NET ASSETS)
(UNAUDITED)
<TABLE>
<CAPTION>
LIFEUSA AGGRESSIVE GROWTH PORTFOLIO
MUTUAL FUNDS - 100.1%
Quantity Value (a)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C>
IAI Capital Appreciation Fund - 49.8% 8,247 $122,637
IAI Emerging Growth Fund- 20.8% 3,460 51,430
IAI Regional Fund - 10.1% 1,088 24,810
IAI Value Fund - 19.4% 3,149 47,929
--------
246,806
- --------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS
(COST: $266,902) (b) ....................................................................... $246,806
========================================================================================================
OTHER ASSETS AND LIABILITIES - (0.1%)
............................................................................................ $ (291)
========================================================================================================
NET ASSETS
............................................................................................ $246,515
========================================================================================================
LIFEUSA GROWTH PORTFOLIO
MUTUAL FUNDS - 100.1%
Quantity Value (a)
- --------------------------------------------------------------------------------------------------------
IAI Growth and Income Fund - 34.9% 3,028 $ 52,485
IAI Growth Fund - 35.4% 4,538 53,196
IAI Midcap Growth Fund - 20.0% 2,193 30,163
IAI Regional Fund - 9.8% 646 14,730
---------
150,574
- --------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS
(COST: $155,885) (b) ....................................................................... $150,574
========================================================================================================
OTHER ASSETS AND LIABILITIES - (0.1%)
............................................................................................ $ (181)
========================================================================================================
NET ASSETS
............................................................................................ $150,393
========================================================================================================
</TABLE>
SEE ACCOMPANYING NOTES TO SCHEDULES OF INVESTMENTS ON PAGE 12
9
<PAGE>
================================================================================
SCHEDULES OF INVESTMENTS
================================================================================
LIFEUSA FUNDS, INC.
JUNE 30, 1998
(PERCENTAGE FIGURES INDICATE PERCENTAGE OF TOTAL NET ASSETS)
(UNAUDITED)
<TABLE>
<CAPTION>
LIFEUSA GLOBAL PORTFOLIO
MUTUAL FUNDS - 100.1%
Quantity Value (a)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C>
IAI Developing Countries Fund - 9.0% 952 $ 6,279
IAI Capital Appreciation Fund - 10.2% 477 7,108
IAI Growth Fund - 31.8% 1,899 22,263
IAI International Fund - 38.6% 2,517 26,986
IAI Growth and Income Fund - 10.5% 422 7,323
---------
69,959
- --------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS
(COST: $76,512) (b) ........................................................................ $ 69,959
========================================================================================================
OTHER ASSETS AND LIABILITIES - (0.1%)
............................................................................................ $ (90)
========================================================================================================
NET ASSETS
............................................................................................ $ 69,869
========================================================================================================
LIFEUSA BALANCED PORTFOLIO
MUTUAL FUNDS - 100.1%
Quantity Value (a)
- --------------------------------------------------------------------------------------------------------
IAI Bond Fund - 25.3% 5,043 $ 48,571
IAI Balanced Fund - 2.0% 328 3,922
IAI Capital Appreciation Fund - 9.0% 1,160 17,253
IAI Developing Countries Fund - 4.4% 1,284 8,463
IAI Government Fund - 7.0% 1,380 13,565
IAI Growth and Income Fund - 17.4% 1,937 33,574
IAI Growth Fund - 17.7% 2,903 34,027
IAI International Fund - 8.5% 1,527 16,372
IAI Value Fund - 8.8% 1,108 16,864
---------
192,611
- --------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS
(COST: $199,723) (b) ....................................................................... $192,611
========================================================================================================
OTHER ASSETS AND LIABILITIES - (0.1%)
............................................................................................ $ (201)
========================================================================================================
NET ASSETS
............................................................................................ $192,410
========================================================================================================
</TABLE>
SEE ACCOMPANYING NOTES TO SCHEDULES OF INVESTMENTS ON PAGE 12
10
<PAGE>
================================================================================
SCHEDULES OF INVESTMENTS
================================================================================
LIFEUSA FUNDS, INC.
JUNE 30, 1998
(PERCENTAGE FIGURES INDICATE PERCENTAGE OF TOTAL NET ASSETS)
(UNAUDITED)
<TABLE>
<CAPTION>
LIFEUSA CURRENT INCOME PORTFOLIO
MUTUAL FUNDS - 100.1%
Quantity Value (a)
- --------------------------------------------------------------------------------------------------------
<S> <C> <C>
IAI Bond Fund - 90.1% 2,932 $ 28,239
IAI Government Fund - 10.0% 318 3,130
---------
31,369
- --------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS
(COST: $30,599) (b) ........................................................................ $ 31,369
========================================================================================================
OTHER ASSETS AND LIABILITIES - (0.1%)
............................................................................................ $ (38)
========================================================================================================
NET ASSETS
............................................................................................ $ 31,331
========================================================================================================
LIFEUSA PRINCIPAL PRESERVATION PORTFOLIO
MUTUAL FUNDS - 99.7%
Quantity Value (a)
- --------------------------------------------------------------------------------------------------------
IAI Money Market Fund - 99.7% 33,730 $ 33,731
- --------------------------------------------------------------------------------------------------------
TOTAL INVESTMENTS
(COST: $33,731) (b) ........................................................................ $ 33,731
========================================================================================================
OTHER ASSETS AND LIABILITIES - 0.3%
............................................................................................ $ 100
========================================================================================================
NET ASSETS
............................................................................................ $ 33,831
========================================================================================================
</TABLE>
SEE ACCOMPANYING NOTES TO SCHEDULES OF INVESTMENTS ON PAGE 12
11
<PAGE>
================================================================================
NOTES TO SCHEDULES OF INVESTMENTS
================================================================================
LIFEUSA FUNDS, INC.
JUNE 30, 1998
(UNAUDITED)
(a)
Value of securities is determined as described in Note 1 to the financial
statements, under "Security Valuation".
(b)
At June 30 1998, the cost of securities for federal income tax purposes and the
aggregate gross unrealized appreciation and depreciation based on that cost
were as follows:
<TABLE>
<CAPTION>
- -----------------------------------------------------------------------------------------------------------------------
LIFEUSA LIFEUSA LIFEUSA
AGGRESSIVE GROWTH GROWTH GLOBAL
PORTFOLIO PORTFOLIO PORTFOLIO
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
Cost for federal income tax purposes $189,004 $110,779 $ 87,075
===================================================================
Gross unrealized appreciation $ -- $ -- $ --
Gross unrealized depreciation (12,312) (5,592) (11,387)
-------------------------------------------------------------------
Net unrealized appreciation (depreciation) $(12,312) $ (5,592) $(11,387)
===================================================================
- -----------------------------------------------------------------------------------------------------------------------
- -----------------------------------------------------------------------------------------------------------------------
LIFEUSA LIFEUSA LIFEUSA PRINCIPAL
BALANCED CURRENT INCOME PRESERVATION
PORTFOLIO PORTFOLIO PORTFOLIO
- -----------------------------------------------------------------------------------------------------------------------
Cost for federal income tax purposes $102,310 $ 28,343 $ 27,795
===================================================================
Gross unrealized appreciation $ 647 $ 565 $ --
Gross unrealized depreciation (5,772) (45) --
-------------------------------------------------------------------
Net unrealized appreciation (depreciation) $ (5,125) $ 520 $ --
===================================================================
- -----------------------------------------------------------------------------------------------------------------------
</TABLE>
12
<PAGE>
================================================================================
STATEMENTS OF ASSETS AND LIABILITIES
================================================================================
LIFEUSA FUNDS, INC.
JUNE 30, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
LIFEUSA LIFEUSA LIFEUSA
AGGRESSIVE GROWTH GROWTH GLOBAL
PORTFOLIO PORTFOLIO PORTFOLIO
- ----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investments in securities, at value
(Cost: $266,902; $155,885; and $76,512, respectively) $ 246,806 $ 150,574 $ 69,959
Organization costs 4,689 4,689 4,689
-----------------------------------------------
TOTAL ASSETS 251,495 155,263 74,648
-----------------------------------------------
LIABILITIES
Accrued distribution fee 291 181 90
Other accrued expenses 4,689 4,689 4,689
-----------------------------------------------
TOTAL LIABILITIES 4,980 4,870 4,779
-----------------------------------------------
NET ASSETS APPLICABLE TO OUTSTANDING CAPITAL STOCK $ 246,515 $ 150,393 $ 69,869
===============================================
REPRESENTED BY:
Capital stock $ 207 $ 132 $ 75
Additional paid-in capital 236,230 141,638 76,790
Undistributed (overdistributed) net investment income (529) (331) (115)
Accumulated net realized gains (losses) on investments 30,703 14,265 (328)
Unrealized appreciation or depreciation on investments (20,096) (5,311) (6,553)
-----------------------------------------------
TOTAL - REPRESENTING NET ASSETS APPLICABLE TO
OUTSTANDING CAPITAL STOCK $ 246,515 $ 150,393 $ 69,869
===============================================
Shares of common stock outstanding; authorized 10 billion shares
of $.01 par value stock of each Portfolio 20,726 13,207 7,499
-----------------------------------------------
NET ASSET VALUE PER SHARE OF OUTSTANDING CAPITAL STOCK $ 11.89 $ 11.39 $ 9.32
===============================================
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
13
<PAGE>
================================================================================
STATEMENTS OF ASSETS AND LIABILITIES
================================================================================
LIFEUSA FUNDS, INC.
JUNE 30, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
LIFEUSA
LIFEUSA LIFEUSA PRINCIPAL
BALANCED CURRENT INCOME PRESERVATION
PORTFOLIO PORTFOLIO PORTFOLIO
- -----------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
ASSETS
Investments in securities, at value
(Cost: $199,723; $30,599; and $33,731, respectively) $ 192,611 $ 31,369 $ 33,731
Cash in bank on demand deposit -- -- 141
Organization costs 4,689 4,689 4,689
---------------------------------------------
TOTAL ASSETS 197,300 36,058 38,561
---------------------------------------------
LIABILITIES
Accrued distribution fee 201 38 41
Other accrued expenses 4,689 4,689 4,689
---------------------------------------------
TOTAL LIABILITIES 4,890 4,727 4,730
---------------------------------------------
NET ASSETS APPLICABLE TO OUTSTANDING CAPITAL STOCK $ 192,410 $ 31,331 $ 33,831
=============================================
REPRESENTED BY:
Capital stock $ 176 $ 30 $ 35
Additional paid-in capital 188,241 29,679 33,767
Undistributed (overdistributed) net investment income 1,052 866 29
Accumulated net realized gains (losses) on investments 10,053 (14) --
Unrealized appreciation or depreciation on investments (7,112) 770 --
---------------------------------------------
TOTAL - REPRESENTING NET ASSETS APPLICABLE TO
OUTSTANDING CAPITAL STOCK $ 192,410 $ 31,331 $ 33,831
=============================================
Shares of common stock outstanding; authorized 10 billion shares
of $.01 par value stock of each Portfolio 17,573 3,036 3,513
---------------------------------------------
NET ASSET VALUE PER SHARE OF OUTSTANDING CAPITAL STOCK $ 10.95 $ 10.32 $ 9.63
=============================================
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
14
<PAGE>
================================================================================
STATEMENTS OF OPERATIONS
================================================================================
LIFEUSA FUNDS, INC.
SIX MONTHS ENDED JUNE 30, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
LIFEUSA LIFEUSA LIFEUSA
AGGRESSIVE GROWTH GROWTH GLOBAL
PORTFOLIO PORTFOLIO PORTFOLIO
- ---------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NET INVESTMENT INCOME
Income:
Dividend distributions from Underlying Funds $ -- $ -- $ 63
-------------------------------------------
TOTAL INCOME -- -- 63
-------------------------------------------
Expenses:
Distribution fees 792 495 266
Legal fees 1,449 1,449 1,449
Custodian Fees 174 174 174
Amortization of organization costs 648 648 648
Audit Fees 1,736 1,736 1,736
Printing and Shareholder reporting 625 403 200
Registration fees 8,388 8,388 8,388
-------------------------------------------
TOTAL EXPENSES 13,812 13,293 12,861
Less fees reimbursed or waived by Sponsor or Distributor (13,283) (12,962) (12,683)
-------------------------------------------
NET EXPENSES 529 331 178
-------------------------------------------
NET INVESTMENT INCOME (LOSS) (529) (331) (115)
-------------------------------------------
NET REALIZED AND UNREALIZED GAINS (LOSSES)
Capital gain distributions from Underlying Funds 26,664 15,837 2,882
Net realized gains (losses) on investments 4,044 (867) (3,132)
Net change in unrealized appreciation or depreciation on
investment securities (7,784) (421) 4,756
-------------------------------------------
NET GAIN ON INVESTMENTS 22,924 14,549 4,506
-------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 22,395 $ 14,218 $ 4,391
===========================================
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
15
<PAGE>
================================================================================
STATEMENTS OF OPERATIONS
================================================================================
LIFEUSA FUNDS, INC.
SIX MONTHS ENDED JUNE 30, 1998
(UNAUDITED)
<TABLE>
<CAPTION>
LIFEUSA
LIFEUSA LIFEUSA PRINCIPAL
BALANCED CURRENT INCOME PRESERVATION
PORTFOLIO PORTFOLIO PORTFOLIO
- ------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C>
NET INVESTMENT INCOME
Income:
Dividend distributions from Underlying Funds $ 1,385 $ 940 $ 759
--------------------------------------------------
TOTAL INCOME 1,385 940 759
--------------------------------------------------
Expenses:
Distribution fees 499 112 115
Legal fees 1,449 1,449 1,449
Custodian Fees 174 174 174
Amortization of organization costs 648 648 645
Audit Fees 1,736 1,736 1,736
Printing and shareholder reporting 322 84 95
Registration fees 8,388 8,387 8,388
--------------------------------------------------
TOTAL EXPENSES 13,216 12,590 12,602
Less fees reimbursed or waived by Sponsor or Distributor (12,883) (12,516) (12,525)
--------------------------------------------------
NET EXPENSES 333 74 77
--------------------------------------------------
NET INVESTMENT INCOME 1,052 866 682
--------------------------------------------------
NET REALIZED AND UNREALIZED GAINS (LOSSES)
Capital gain distributions from Underlying Funds 9,178 -- --
Net realized gains (losses) on investments 932 (14) --
Net change in unrealized appreciation or depreciation on
investment securities (2,042) 250 --
--------------------------------------------------
NET GAIN ON INVESTMENTS 8,068 236 --
--------------------------------------------------
NET INCREASE IN NET ASSETS RESULTING FROM OPERATIONS $ 9,120 $ 1,102 $ 682
==================================================
</TABLE>
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
16
<PAGE>
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA AGGRESSIVE GROWTH PORTFOLIO
<TABLE>
<CAPTION>
Period from
Six months ended February 3, 1997*
June 30,1998 to December 31, 1997
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS (UNAUDITED)
Net investment income (loss) $ (529) $ (228)
Net realized gains (losses) 30,708 22,198
Net change in unrealized appreciation or depreciation (7,784) (12,312)
--------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 22,395 9,658
--------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income -- (854)
Net realized gains (20,560) (1,643)
--------------------------------------------
TOTAL DISTRIBUTIONS (20,560) (2,497)
--------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from shares of 4,591 and 13,299 shares 57,421 150,454
Net asset value of 1,735 and 218 shares issued in
reinvestment of distributions 20,559 2,497
Cost of 781 and 169 shares redeemed (9,796) (1,950)
--------------------------------------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS 68,184 151,001
--------------------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS 70,019 158,162
NET ASSETS AT BEGINNING OF PERIOD 176,496 18,334
--------------------------------------------
NET ASSETS AT END OF PERIOD $ 246,515 $ 176,496
============================================
INCLUDING OVERDISTRIBUTED NET INVESTMENT INCOME OF: $ (529) $ --
============================================
Percentage of shares outstanding owned by sponsor 9.79% 12.25%
============================================
</TABLE>
* COMMENCEMENT OF OPERATIONS
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
17
<PAGE>
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA GROWTH PORTFOLIO
<TABLE>
<CAPTION>
Period from
Six months ended February 3, 1997*
June 30,1998 to December 31, 1997
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS (UNAUDITED)
Net investment income (loss) $ (331) $ (132)
Net realized gains (losses) 14,970 9,131
Net change in unrealized appreciation or depreciation (421) (4,890)
------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 14,218 4,109
------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income -- (950)
Net realized gains (6,910) (2,926)
------------------------------------------
TOTAL DISTRIBUTIONS (6,910) (3,876)
------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from the sale of 3,170 and 7,749 shares 35,769 83,866
Net asset value of 606 and 364 shares issued in
reinvestment of distributions 6,909 3,876
Cost of 401 and 114 shares redeemed (4,672) (1,230)
------------------------------------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS 38,006 86,512
------------------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS 45,314 86,745
NET ASSETS AT BEGINNING OF PERIOD 105,079 18,334
------------------------------------------
NET ASSETS AT END OF PERIOD $ 150,393 $ 105,079
==========================================
INCLUDING OVERDISTRIBUTED NET INVESTMENT INCOME OF: $ (331) $ --
==========================================
Percentage of shares outstanding owned by sponsor 15.11% 19.37%
==========================================
</TABLE>
* COMMENCEMENT OF OPERATIONS
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
18
<PAGE>
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA GLOBAL PORTFOLIO
<TABLE>
<CAPTION>
Period from
Six months ended February 3, 1997*
June 30,1998 to December 31, 1997
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS (UNAUDITED)
Net investment income (loss) $ (115) $ 689
Net realized gains (losses) (250) 8,853
Net change in unrealized appreciation or depreciation 4,756 (11,309)
------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 4,391 (1,767)
------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income -- (1,771)
Net realized gains (6,746) (2,185)
------------------------------------------
TOTAL DISTRIBUTIONS (6,746) (3,956)
------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from sale of 352 and 5,763 shares 3,580 60,817
Net asset value of 726 and 410 shares issued in
reinvestment of distributions 6,746 3,956
Cost of 1,415 and 170 shares redeemed (13,697) (1,788)
------------------------------------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS (3,371) 62,985
------------------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS (5,726) 57,262
NET ASSETS AT BEGINNING OF PERIOD 75,595 18,333
------------------------------------------
NET ASSETS AT END OF PERIOD $ 69,869 $ 75,595
==========================================
INCLUDING OVERDISTRIBUTED NET INVESTMENT INCOME OF: $ (115) $ --
==========================================
Percentage of shares outstanding owned by sponsor 15.11% 24.69%
==========================================
</TABLE>
* COMMENCEMENT OF OPERATIONS
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
19
<PAGE>
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA BALANCED PORTFOLIO
<TABLE>
<CAPTION>
Period from
Six months ended February 3, 1997*
June 30,1998 to December 31, 1997
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS (UNAUDITED)
Net investment income $ 1,052 $ 1,534
Net realized gains (losses) 10,110 5,923
Net change in unrealized appreciation or depreciation (2,042) (5,070)
------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 9,120 2,387
------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income -- (2,616)
Net realized gains (4,846) (1,134)
------------------------------------------
TOTAL DISTRIBUTIONS (4,846) (3,750)
------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from sale of 8,043 and 7,174 shares 88,805 76,856
Net asset value of shares 443 and 361 issued in
reinvestment of distributions 4,846 3,750
Cost of 234 and 47 shares redeemed (2,591) (500)
------------------------------------------
INCREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS 91,060 80,106
------------------------------------------
TOTAL INCREASE IN NET ASSETS 95,334 78,743
NET ASSETS AT BEGINNING OF PERIOD 97,076 18,333
------------------------------------------
NET ASSETS AT END OF PERIOD $ 192,410 $ 97,076
==========================================
INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF: $ 1,052 $ --
==========================================
Percentage of shares outstanding owned by sponsor 11.13% 20.46%
==========================================
</TABLE>
* COMMENCEMENT OF OPERATIONS
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
20
<PAGE>
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA CURRENT INCOME PORTFOLIO
<TABLE>
<CAPTION>
Period from
Six months ended February 3, 1997*
June 30,1998 to December 31, 1997
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS (UNAUDITED)
Net investment income (loss) $ 866 $ 1,156
Net realized gains (losses) (14) 18
Net change in unrealized appreciation or depreciation 250 520
------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 1,102 1,694
------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (26) (2,212)
Net realized gains (18) --
------------------------------------------
TOTAL DISTRIBUTIONS (44) (2,212)
------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from sale of 138 and 838 shares 1,402 8,800
Net asset value of 4 and 223 shares issued in
reinvestment of distributions 44 2,212
------------------------------------------
INCREASE (DECREASE) IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS 1,446 11,012
------------------------------------------
TOTAL INCREASE (DECREASE) IN NET ASSETS 2,504 10,494
NET ASSETS AT BEGINNING OF PERIOD 28,827 18,333
------------------------------------------
NET ASSETS AT END OF PERIOD $ 31,331 $ 28,827
==========================================
INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF: $ 866 $ 26
==========================================
Percentage of shares outstanding owned by sponsor 65.49% 68.62%
==========================================
</TABLE>
* COMMENCEMENT OF OPERATIONS
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
21
<PAGE>
================================================================================
STATEMENTS OF CHANGES IN NET ASSETS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA PRINCIPAL PRESERVATION PORTFOLIO
<TABLE>
<CAPTION>
Period from
Six months ended February 3, 1997*
June 30,1998 to December 31, 1997
- -------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C>
OPERATIONS (UNAUDITED)
Net investment income $ 682 $ 980
------------------------------------------
NET INCREASE (DECREASE) IN NET ASSETS RESULTING FROM OPERATIONS 682 980
------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (704) (2,014)
------------------------------------------
TOTAL DISTRIBUTIONS (704) (2,014)
------------------------------------------
CAPITAL SHARE TRANSACTIONS
Net proceeds from the sale of 663 and 1,145 shares 6,385 11,470
Net asset value of 73 and 205 shares issued in
reinvestment of distributions 703 2,014
Cost of 137 and 269 shares redeemed (1,318) (2,700)
------------------------------------------
INCREASE IN NET ASSETS FROM CAPITAL SHARE TRANSACTIONS 5,770 10,784
------------------------------------------
TOTAL INCREASE IN NET ASSETS 5,748 9,750
NET ASSETS AT BEGINNING OF PERIOD 28,083 18,333
------------------------------------------
NET ASSETS AT END OF PERIOD $ 33,831 $ 28,083
==========================================
INCLUDING UNDISTRIBUTED NET INVESTMENT INCOME OF: $ 29 $ 51
==========================================
Percentage of shares outstanding owned by sponsor 57.68% 67.95%
==========================================
</TABLE>
* COMMENCEMENT OF OPERATIONS
SEE ACCOMPANYING NOTES TO FINANCIAL STATEMENTS ON PAGE 29
22
<PAGE>
================================================================================
FINANCIAL HIGHLIGHTS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA AGGRESSIVE GROWTH PORTFOLIO
PER SHARE DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
AND SELECTED INFORMATION FOR EACH PERIOD INDICATED ARE AS FOLLOWS:
<TABLE>
<CAPTION>
Period from
Six Months ended February 3, 1997****
June 30,1998 to December 31, 1997
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
NET ASSET VALUE (UNAUDITED)
Beginning of period $11.63 $10.00
--------------------------------------------
OPERATIONS
Net investment income (loss) (0.03) (0.01)
Net realized and unrealized gains 1.37 1.81
--------------------------------------------
TOTAL FROM OPERATIONS 1.34 1.80
--------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income -- (0.06)
Net realized gains (1.08) (0.11)
--------------------------------------------
TOTAL DISTRIBUTIONS (1.08) (0.17)
--------------------------------------------
NET ASSET VALUE
End of period $11.89 $11.63
============================================
Total investment return* 11.57% 18.00%
Net assets at end of period (000's omitted) $ 247 $ 176
RATIOS:
Expenses to average daily net assets*** 0.50%** 0.50%**
Net investment income (loss) to average daily net assets*** (0.50%)* (0.30%)**
Portfolio turnover rate 33.2% 4.5%
</TABLE>
* TOTAL INVESTMENT RETURN IS BASED ON THE CHANGE IN NET ASSET VALUE OF A
SHARE DURING THE PERIOD AND ASSUMES REINVESTMENT OF ALL DISTRIBUTIONS AT
NET ASSET VALUE.
** ANNUALIZED
*** THE PORTFOLIO'S SPONSOR VOLUNTARILY WAIVED $13,283 AND $15,847,
RESPECTIVELY, IN EXPENSES FOR THE PERIODS ENDED JUNE 30, 1998 AND DECEMBER
31, 1997. IF THE PORTFOLIO HAD BEEN CHARGED THESE EXPENSES, THE RATIOS OF
EXPENSES TO AVERAGE DAILY NET ASSETS WOULD HAVE BEEN 13.08% AND 21.36%,
RESPECTIVELY, AND THE RATIOS OF NET INVESTMENT INCOME (LOSS) TO AVERAGE
DAILY NET ASSETS WOULD HAVE BEEN (13.08%) AND (21.16%) RESPECTIVELY. THESE
EXPENSES WILL BE VOLUNTARILY WAIVED THROUGH MAY 1, 1999. THE EXPENSE RATIOS
EXCLUDE THE FEES AND EXPENSES OF THE UNDERLYING FUNDS.
**** COMMENCEMENT OF OPERATIONS
23
<PAGE>
================================================================================
FINANCIAL HIGHLIGHTS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA GROWTH PORTFOLIO
PER SHARE DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
AND SELECTED INFORMATION FOR EACH PERIOD INDICATED ARE AS FOLLOWS:
<TABLE>
<CAPTION>
Period from
Six Months ended February 3, 1997****
June 30,1998 to December 31, 1997
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
NET ASSET VALUE (UNAUDITED)
Beginning of period $10.69 $10.00
--------------------------------------------
OPERATIONS
Net investment income (loss) (0.03) (0.01)
Net realized and unrealized gains (losses) 1.28 1.11
--------------------------------------------
TOTAL FROM OPERATIONS 1.25 1.10
--------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income -- (0.10)
Net realized gains (0.55) (0.31)
--------------------------------------------
TOTAL DISTRIBUTIONS (0.55) (0.41)
--------------------------------------------
NET ASSET VALUE
End of period $11.39 $10.69
============================================
Total investment return* 11.67% 11.01%
Net assets at end of period (000's omitted) $ 150 $ 105
RATIOS:
Expenses to average daily net assets*** 0.50%** 0.50%**
Net investment income (loss) to average daily net assets*** (0.50%)** (0.31)%**
Portfolio turnover rate 21.3% 32.4%
</TABLE>
* TOTAL INVESTMENT RETURN IS BASED ON THE CHANGE IN NET ASSET VALUE OF A
SHARE DURING THE PERIOD AND ASSUMES REINVESTMENT OF ALL DISTRIBUTIONS AT
NET ASSET VALUE.
** ANNUALIZED
*** THE PORTFOLIO'S SPONSOR VOLUNTARILY WAIVED $12,962 AND $15,760,
RESPECTIVELY, IN EXPENSES FOR THE PERIODS ENDED JUNE 30, 1998 AND DECEMBER
31, 1997. IF THE PORTFOLIO HAD BEEN CHARGED THESE EXPENSES, THE RATIOS OF
EXPENSES TO AVERAGE DAILY NET ASSETS WOULD HAVE BEEN 20.12% AND 37.30%,
RESPECTIVELY, AND THE RATIOS OF NET INVESTMENT INCOME (LOSS) TO AVERAGE
DAILY NET ASSETS WOULD HAVE BEEN (20.12%) AND (37.11%), RESPECTIVELY. THESE
EXPENSES WILL BE VOLUNTARILY WAIVED THROUGH MAY 1, 1999. THE EXPENSE RATIOS
EXCLUDE THE FEES AND EXPENSES OF THE UNDERLYING FUNDS.
**** COMMENCEMENT OF OPERATIONS
24
<PAGE>
================================================================================
FINANCIAL HIGHLIGHTS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA GLOBAL PORTFOLIO
PER SHARE DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
AND SELECTED INFORMATION FOR EACH PERIOD INDICATED ARE AS FOLLOWS:
<TABLE>
<CAPTION>
Period from
Six Months ended February 3, 1997****
June 30,1998 to December 31, 1997
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
NET ASSET VALUE (UNAUDITED)
Beginning of period $9.65 $10.00
--------------------------------------------
OPERATIONS
Net investment income (loss) (0.02) 0.10
Net realized and unrealized gains (losses) 0.69 0.08
--------------------------------------------
TOTAL FROM OPERATIONS 0.67 0.18
--------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income -- (0.24)
Net realized gains (1.00) (0.29)
--------------------------------------------
TOTAL DISTRIBUTIONS (1.00) (0.53)
--------------------------------------------
NET ASSET VALUE
End of period $9.32 $9.65
============================================
Total investment return* 6.93% 1.83%
Net assets at end of period (000's omitted) $70 $76
RATIOS:
Expenses to average daily net assets*** 0.50%** 0.50%**
Net investment income (loss) to average daily net assets*** (0.32%)* 1.31%**
Portfolio turnover rate 33.7% 28.7%
</TABLE>
* TOTAL INVESTMENT RETURN IS BASED ON THE CHANGE IN NET ASSET VALUE OF A
SHARE DURING THE PERIOD AND ASSUMES REINVESTMENT OF ALL DISTRIBUTIONS AT
NET ASSET VALUE.
** ANNUALIZED
*** THE PORTFOLIO'S SPONSOR VOLUNTARILY WAIVED $12,683 AND $15,783,
RESPECTIVELY, IN EXPENSES FOR THE PERIODS ENDED JUNE 30, 1998 AND DECEMBER
31, 1997. IF THE PORTFOLIO HAD BEEN CHARGED THESE EXPENSES, THE RATIOS OF
EXPENSES TO AVERAGE DAILY NET ASSETS WOULD HAVE BEEN 36.78% AND 30.40%,
RESPECTIVELY, AND THE RATIOS OF NET INVESTMENT INCOME (LOSS) TO AVERAGE
DAILY NET ASSETS WOULD HAVE BEEN (36.60%) AND (28.59%), RESPECTIVELY. THESE
EXPENSES WILL BE VOLUNTARILY WAIVED THROUGH MAY 1, 1999. THE EXPENSE RATIOS
EXCLUDE THE FEES AND EXPENSES OF THE UNDERLYING FUNDS.
**** COMMENCEMENT OF OPERATIONS
25
<PAGE>
================================================================================
FINANCIAL HIGHLIGHTS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA BALANCED PORTFOLIO
PER SHARE DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
AND SELECTED INFORMATION FOR EACH PERIOD INDICATED ARE AS FOLLOWS:
<TABLE>
<CAPTION>
Period from
Six Months ended February 3, 1997****
June 30,1998 to December 31, 1997
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
NET ASSET VALUE (UNAUDITED)
Beginning of period $10.41 $10.00
--------------------------------------------
OPERATIONS
Net investment income 0.06 0.18
Net realized and unrealized gains 0.76 0.65
--------------------------------------------
TOTAL FROM OPERATIONS 0.82 0.83
--------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income -- (0.29)
Net realized gains (0.28) (0.13)
--------------------------------------------
TOTAL DISTRIBUTIONS (0.28) (0.42)
--------------------------------------------
NET ASSET VALUE
End of period $10.95 $10.41
============================================
Total investment return* 7.91% 8.30%
Net assets at end of period (000's omitted) $ 192 $ 97
RATIOS:
Expenses to average daily net assets*** 0.50%** 0.50%**
Net investment income (loss) to average daily net assets*** 1.58%** 3.26%**
Portfolio turnover rate 34.8% 21.9%
</TABLE>
* TOTAL INVESTMENT RETURN IS BASED ON THE CHANGE IN NET ASSET VALUE OF A
SHARE DURING THE PERIOD AND ASSUMES REINVESTMENT OF ALL DISTRIBUTIONS AT
NET ASSET VALUE.
** ANNUALIZED
*** THE PORTFOLIO'S SPONSOR VOLUNTARILY WAIVED $12,883 AND $15,770,
RESPECTIVELY, IN EXPENSES FOR THE PERIODS ENDED JUNE 30, 1998 AND DECEMBER
31, 1997. IF THE PORTFOLIO HAD BEEN CHARGED THESE EXPENSES, THE RATIOS OF
EXPENSES TO AVERAGE DAILY NET ASSETS WOULD HAVE BEEN 19.86% AND 33.99%,
RESPECTIVELY, AND THE RATIOS OF NET INVESTMENT INCOME (LOSS) TO AVERAGE
DAILY NET ASSETS WOULD HAVE BEEN (17.77%) AND (30.23%), RESPECTIVELY.
THESE EXPENSES WILL BE VOLUNTARILY WAIVED THROUGH MAY 1, 1999. THE EXPENSE
RATIOS EXCLUDE THE FEES AND EXPENSES OF THE UNDERLYING FUNDS.
**** COMMENCEMENT OF OPERATIONS
26
<PAGE>
================================================================================
FINANCIAL HIGHLIGHTS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA CURRENT INCOME PORTFOLIO
PER SHARE DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
AND SELECTED INFORMATION FOR EACH PERIOD INDICATED ARE AS FOLLOWS:
<TABLE>
<CAPTION>
Period from
Six Months ended February 3, 1997****
June 30,1998 to December 31, 1997
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
NET ASSET VALUE (UNAUDITED)
Beginning of period $ 9.96 $10.00
--------------------------------------------
OPERATIONS
Net investment income 0.29 0.46
Net realized and unrealized gains 0.09 0.33
--------------------------------------------
TOTAL FROM OPERATIONS 0.38 0.79
--------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (0.01) (0.83)
Net realized gains (0.01) --
--------------------------------------------
TOTAL DISTRIBUTIONS (0.02) (0.83)
--------------------------------------------
NET ASSET VALUE
End of period $10.32 $ 9.96
============================================
Total investment return* 3.76% 7.90%
Net assets at end of period (000's omitted) $ 31 $ 29
RATIOS:
Expenses to average daily net assets*** 0.50%** 0.50%**
Net investment income (loss) to average daily net assets*** 5.79%** 5.57%**
Portfolio turnover rate 10.5% 13.1%
</TABLE>
* TOTAL INVESTMENT RETURN IS BASED ON THE CHANGE IN NET ASSET VALUE OF A
SHARE DURING THE PERIOD AND ASSUMES REINVESTMENT OF ALL DISTRIBUTIONS AT
NET ASSET VALUE.
** ANNUALIZED
*** THE PORTFOLIO'S SPONSOR VOLUNTARILY WAIVED $12,516 AND $15,700,
RESPECTIVELY, IN EXPENSES FOR THE PERIODS ENDED JUNE 30, 1998 AND DECEMBER
31, 1997. IF THE PORTFOLIO HAD BEEN CHARGED THESE EXPENSES, THE RATIOS OF
EXPENSES TO AVERAGE DAILY NET ASSETS WOULD HAVE BEEN 84.21% AND 76.20%,
RESPECTIVELY, AND THE RATIOS OF NET INVESTMENT INCOME (LOSS) TO AVERAGE
DAILY NET ASSETS WOULD HAVE BEEN (77.92%) AND (70.13%), RESPECTIVELY.
THESE EXPENSES WILL BE VOLUNTARILY WAIVED THROUGH MAY 1, 1999. THE EXPENSE
RATIOS EXCLUDE THE FEES AND EXPENSES OF THE UNDERLYING FUNDS.
**** COMMENCEMENT OF OPERATIONS
27
<PAGE>
================================================================================
FINANCIAL HIGHLIGHTS
================================================================================
LIFEUSA FUNDS, INC.
LIFEUSA PRINCIPAL PRESERVATION PORTFOLIO
PER SHARE DATA FOR A SHARE OF CAPITAL STOCK OUTSTANDING THROUGHOUT EACH PERIOD
AND SELECTED INFORMATION FOR EACH PERIOD INDICATED ARE AS FOLLOWS:
<TABLE>
<CAPTION>
Period from
Six Months ended February 3, 1997****
June 30,1998 to December 31, 1997
- ----------------------------------------------------------------------------------------------------------
<S> <C> <C>
NET ASSET VALUE (UNAUDITED)
Beginning of period $9.64 $10.00
--------------------------------------------
OPERATIONS
Net investment income (loss) 0.23 0.41
Net realized and unrealized gains (losses) (0.02) --
--------------------------------------------
TOTAL FROM OPERATIONS 0.21 0.41
--------------------------------------------
DISTRIBUTIONS TO SHAREHOLDERS FROM:
Net investment income (0.22) (0.77)
--------------------------------------------
TOTAL DISTRIBUTIONS (0.22) (0.77)
--------------------------------------------
NET ASSET VALUE
End of period $9.63 $ 9.64
============================================
Total investment return* 2.21% 4.13%
Net assets at end of period (000's omitted) $ 34 $ 28
RATIOS:
Expenses to average daily net assets*** 0.50%** 0.50%**
Net investment income (loss) to average daily net assets*** 4.44%** 4.48%**
Portfolio turnover rate 3.7% 11.0%
</TABLE>
* TOTAL INVESTMENT RETURN IS BASED ON THE CHANGE IN NET ASSET VALUE OF A
SHARE DURING THE PERIOD AND ASSUMES REINVESTMENT OF ALL DISTRIBUTIONS AT
NET ASSET VALUE.
** ANNUALIZED
*** THE PORTFOLIO'S SPONSOR VOLUNTARILY WAIVED $12,525 AND $15,739 ,
RESPECTIVELY, IN EXPENSES FOR THE PERIODS ENDED JUNE 30, 1998 AND DECEMBER
31, 1997. IF THE PORTFOLIO HAD BEEN CHARGED THESE EXPENSES, THE RATIOS OF
EXPENSES TO AVERAGE DAILY NET ASSETS WOULD HAVE BEEN 82.12% AND 72.49%,
RESPECTIVELY, AND THE RATIOS OF NET INVESTMENT INCOME (LOSS) TO AVERAGE
DAILY NET ASSETS WOULD HAVE BEEN (77.18%) AND (67.51%), RESPECTIVELY. THESE
EXPENSES WILL BE VOLUNTARILY WAIVED THROUGH MAY 1, 1999. THE EXPENSE RATIOS
EXCLUDE THE FEES AND EXPENSES OF THE UNDERLYING FUNDS.
**** COMMENCEMENT OF OPERATIONS
28
<PAGE>
================================================================================
NOTES TO FINANCIAL STATEMENTS
================================================================================
LIFEUSA FUNDS, INC.
JUNE 30,1998
(UNAUDITED)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
LifeUSA Funds, Inc. (the Company) was incorporated on April 26, 1996, and is
registered under the Investment Company Act of 1940 (as amended) as an open-end
management investment company consisting of the following six separate
diversified investment portfolios: LifeUSA Aggressive Growth Portfolio
(Aggressive Growth Portfolio), LifeUSA Growth Portfolio (Growth Portfolio),
LifeUSA Global Portfolio (Global Portfolio), LifeUSA Balanced Portfolio
(Balanced Portfolio), LifeUSA Current Income Portfolio (Current Income
Portfolio) and LifeUSA Principal Preservation Portfolio (Principal Preservation
Portfolio) (collectively, the Portfolios). The sponsor and distributor of the
Portfolios is LifeUSA Securities, Inc. (the Sponsor or Distributor). Each of the
Portfolios was created as a separate portfolio represented by a separate class
of common stock of the Company and offer a means of investing in shares of
certain IAI Mutual Funds (the Underlying Funds) within certain predetermined
percentage ranges. The Company's articles of incorporation permit the Board of
Directors to create additional portfolios in the future and each Portfolio is
permitted to issue separate classes of stock. This report covers only the
Aggressive Growth Portfolio, Growth Portfolio, Global Portfolio, Balanced
Portfolio, Current Income Portfolio and Principal Preservation Portfolio,
currently the only Portfolios of the Company. Financial statements for the
Underlying Funds may be obtained by calling the toll-free Investor Services
Hotline at 1-800-945-3863.
Significant accounting policies followed by the Portfolios are summarized below:
PORTFOLIO VALUATION
The investments of the Portfolios consist of mutual funds that are valued daily
at their respective net asset values in accordance with the Investment Company
Act of 1940.
FEDERAL TAXES
Since it is each Portfolio's policy to comply with the provisions of the
Internal Revenue Code applicable to regulated investment companies and to
distribute all of its taxable income to its shareholders, no provision for
income taxes is required. In order to avoid the payment of any federal excise
taxes, the Portfolios are required to distribute substantially all of their net
investment income and net realized gains on a calendar year basis.
Net investment income and net realized gains may differ for financial statement
and tax purposes primarily because of the deferral of "wash sale" losses for tax
purposes. The character of distributions made during the year for net investment
income or net realized gains may also differ from its ultimate characterization
for tax purposes.
SECURITY TRANSACTIONS AND INVESTMENT INCOME
Security transactions are accounted for on the trade date. Realized gains and
losses from security transactions are reported on an identified-cost basis for
both financial statement and federal income tax purposes. Distributions to
shareholders from the Underlying Funds are recorded on the ex-dividend date.
Interest income and expenses are recorded on an accrual basis.
DISTRIBUTIONS TO SHAREHOLDERS
Distributions to shareholders are recorded on the ex-dividend date.
Distributions from net investment income are made semi-annually (monthly for the
LifeUSA Principal Preservation Portfolio). Capital gains, if any, are primarily
distributed at the end of the calendar year. Additional capital gains
distributions, as needed to comply with federal tax regulations, are distributed
during the year.
29
<PAGE>
================================================================================
NOTES TO FINANCIAL STATEMENTS
================================================================================
LIFEUSA FUNDS, INC.
JUNE 30,1998
(UNAUDITED)
(1) SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONT.)
ORGANIZATION COSTS
Organization costs are being amortized over sixty months on a straight-line
basis. In the event the Sponsor redeems any or all of its shares representing
initial capital in the Portfolios prior to the date such costs are fully
amortized, it will bear such portion of the unamortized organization costs as
the number of shares redeemed bears to the initial purchase of shares.
USE OF ESTIMATES
The preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements.
Actual amounts could differ from those estimates.
(2) FEES AND EXPENSES
The Company has entered into an investment advisory and administrative services
agreement with Investment Advisers, Inc. (Advisers) who is also the adviser to
the Underlying Funds. Pursuant to the agreement, Advisers provides the
Portfolios with investment advisory services and is responsible for the overall
management of the Portfolios' business affairs subject to the authority of the
Board of Directors. Because the Underlying Funds pay Advisers a management fee,
no compensation is paid to Advisers under the agreement. The agreement also
provides that each Portfolio shall pay the fees and expenses of outside legal
counsel, independent public accountants, and custodians as well as certain
expenses incurred in connection with the registration of Portfolio shares for
sale to the public, interest and, in certain circumstances, taxes and
extraordinary expenses. Until May 1, 1999, the Sponsor has voluntarily agreed to
reimburse the Portfolios for all other expenses.
The Portfolios have adopted a plan of distribution under Rule 12b-1 of the
Investment Company Act of 1940. Under such Plan, the Portfolios have entered
into an underwriting and distribution agreement with the Distributor. Under the
agreement, the Portfolios pay the Distributor a fee for the servicing of
shareholder accounts and the distribution of Portfolio shares. The fee is
computed monthly based on average daily net assets for each Portfolio at an
annual rate of 0.75% (0.50% payable as distribution fee and 0.25% as a
shareholder servicing fee). Until May 1, 1999, the Sponsor has voluntarily
agreed to waive that portion of the fee in excess of 0.50% of each Portfolio's
average daily net assets.
(3) PURCHASES AND SALES OF SECURITIES
For the period ended June 30, 1998, purchases and sales proceeds of the
Underlying Funds were as follows:
- -------------------------------------------------------------------------------
PURCHASES SALES
- -------------------------------------------------------------------------------
LIFEUSA AGGRESSIVE GROWTH PORTFOLIO $144,346 $ 70,492
LIFEUSA GROWTH PORTFOLIO $ 74,825 $ 28,150
LIFEUSA GLOBAL PORTFOLIO $ 24,231 $ 31,584
LIFEUSA BALANCED PORTFOLIO $142,897 $ 46,361
LIFEUSA CURRENT INCOME PORTFOLIO $ 5,440 $ 3,170
LIFEUSA PRINCIPAL PRESERVATION PORTFOLIO $ 7,291 $ 1,355
- -------------------------------------------------------------------------------
(4) SUBSEQUENT EVENT
On August 5,1998 the Board of Directors approved a plan to liquidate and
dissolve the LifeUSA Funds.
30
<PAGE>
DISTRIBUTOR
LifeUSA Securities, Inc.
INVESTMENT ADVISER
AND MANAGER
Investment Advisers, Inc.
P.O. Box 357
Minneapolis, MN 55402 USA
LEGAL COUNSEL
Dorsey & Whitney LLP
220 South Sixth Street
Minneapolis, MN 55402
INDEPENDENT AUDITORS
KPMG Peat Marwick LLP
4200 Norwest Center
Minneapolis, MN 55402
DIRECTORS
Madeline Betsch
W. William Hodgson
George R. Long
J. Peter Thompson
Charles H. Withers
[LOGO]
LIFEUSA
SECURITIES
300 SOUTH HIGHWAY 169
MINNEAPOLIS, MINNESOTA 55426
888.446.5872 (PHONE)
612.513.7120 (FAX)
