JNL SERIES TRUST, 497, 1998-01-06

JNL SERIES TRUST
497, 1998-01-06

Previous: ICAP FUNDS INC, 497, 1998-01-06

Next: BANK WEST FINANCIAL CORP, 4, 1998-01-06

<PAGE> 1

PROSPECTUS
January 2, 1998

JNL(R) SERIES TRUST
- --------------------------------------------------------------------------------
5901 Executive Drive - Lansing, Michigan 48911

This Prospectus provides you with the basic information you should know
before investing in the JNL Series Trust ("Trust"). You should read it and keep
it for future reference. A Statement of Additional Information, dated January 2,
1998, has been filed with the Securities and Exchange Commission. You can obtain
a copy without charge by calling (800) 322-8257, or writing the JNL Series Trust
Service Center, P.O. Box 25127, Lansing, MI 48909. The Securities and Exchange
Commission maintains a Web site (http://www.sec.gov) that contains the Statement
of Additional Information, material incorporated by reference, and other
information regarding registrants that file electronically with the Commission.

The Trust is an open-end management investment company organized under the
laws of Massachusetts, by a Declaration of Trust, dated June 1, 1994. The Trust
currently offers shares in separate Series, each with its own investment
objective. The shares of the Trust are sold to life insurance company separate
accounts to fund the benefits of variable annuity policies.

JNL AGGRESSIVE GROWTH SERIES is a non-diversified Series that seeks as its
investment objective long-term growth of capital by investing primarily in
common stocks of issuers of any size, including larger, well-established
companies and smaller, emerging growth companies.

JNL CAPITAL GROWTH SERIES is a non-diversified Series that seeks as its
investment objective long-term growth of capital by emphasizing investments in
common stocks of medium-sized companies. Although the Series expects to
emphasize such securities, it may also invest in smaller or larger companies.

JNL GLOBAL EQUITIES SERIES seeks as its investment objective long-term
growth of capital by investing primarily in common stocks of foreign and
domestic issuers of any size. This Series normally invests in issuers from at
least five different countries including the United States.

JNL/ALGER GROWTH SERIES seeks as its investment objective long-term capital
appreciation by investing in a diversified, actively managed portfolio of equity
securities, primarily of companies with total market capitalization of $1
billion or greater.

JNL/PUTNAM GROWTH SERIES seeks as its investment objective long-term growth
of capital. Since income is not an objective, any income generated by the
investment of this Series' assets will be incidental to its objective. It is
intended that this Series will invest primarily in the common stocks of
companies believed by the sub-adviser to have opportunity for capital growth.

JNL/PUTNAM VALUE EQUITY SERIES seeks as its investment objective capital
growth, with income as a secondary objective by investing primarily in common
stocks which the sub-adviser believes to be undervalued relative to underlying
asset value or earnings potential at the time of purchase.

PPM AMERICA/JNL BALANCED SERIES seeks as its investment objective
reasonable income, long-term capital growth and preservation of capital. It is
intended that this Series will invest in common stocks and fixed income
securities, with emphasis on income-producing securities which appear to have
some potential for capital enhancement.

PPM AMERICA/JNL HIGH YIELD BOND SERIES seeks as its investment objective a
high level of current income; its secondary investment objective is capital
appreciation by investing in fixed income securities, with emphasis on
higher-yielding, higher-risk, lower-rated or unrated corporate bonds.

1
<PAGE> 2

PPM AMERICA/JNL MONEY MARKET SERIES seeks as its investment objective as
high a level of current income as is consistent with the preservation of capital
and maintenance of liquidity by investing in high-quality, short-term money
market instruments.

SALOMON BROTHERS/JNL GLOBAL BOND SERIES seeks as its investment objective a
high level of current income. As a secondary objective, the Series will seek
capital appreciation. The Series seeks to achieve its objectives by investing in
a globally diverse portfolio of fixed income investments and by giving the
sub-adviser broad discretion to deploy the Series' assets among certain segments
of the fixed income market that the sub-adviser believes will best contribute to
achievement of the Series' investment objectives. In pursuing its investment
objectives, the Series reserves the right to invest predominantly in securities
rated in medium or lower rating categories or as determined by the sub-adviser
to be of comparable quality. Although the Series has the ability to invest up to
100% of the Series' assets in lower-rated securities, the Series' sub-adviser
does not anticipate investing in excess of 75% of the Series' assets in such
securities.

SALOMON BROTHERS/JNL U.S. GOVERNMENT & QUALITY BOND SERIES seeks as its
investment objective a high level of current income, by investing primarily in
debt obligations and mortgage-backed securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities including collateralized mortgage
obligations backed by such securities. The Series may also invest a portion of
its assets in investment-grade bonds.

T. ROWE PRICE/JNL ESTABLISHED GROWTH SERIES seeks as its investment
objective long-term growth of capital and increasing dividend income through
investment primarily in common stocks of well-established growth companies.

T. ROWE PRICE/JNL INTERNATIONAL EQUITY INVESTMENT SERIES seeks as its
investment objective long-term growth of capital through investments primarily
in common stocks of established, non-U.S. companies.

T. ROWE PRICE/JNL MID-CAP GROWTH SERIES seeks as its investment objective
long-term growth of capital by investing primarily in the common stock of
companies with medium-sized market capitalizations ("mid-cap") and the potential
for above average growth.

As a result of the market risk inherent in any investment, there is no
assurance that the investment objective of any of the Series will be realized.
Investments in a Series are neither insured nor guaranteed by the U.S.
Government or any other entity or person, and there can be no assurance that the
PPM America/JNL Money Market Series will be able to maintain a stable net asset
value of $1.00 per share.

THE PPM AMERICA/JNL HIGH YIELD BOND SERIES INVESTS PREDOMINANTLY IN, AND
THE JNL AGGRESSIVE GROWTH SERIES, JNL CAPITAL GROWTH SERIES, JNL GLOBAL EQUITIES
SERIES, PPM AMERICA/JNL BALANCED SERIES AND SALOMON BROTHERS/JNL GLOBAL BOND
SERIES MAY INVEST IN HIGH YIELD, HIGH RISK BONDS. BONDS OF THIS TYPE ARE
TYPICALLY SUBJECT TO GREATER MARKET FLUCTUATIONS AND RISK OF LOSS OF INCOME AND
PRINCIPAL DUE TO DEFAULT BY THE ISSUER THAN ARE INVESTMENTS IN LOWER YIELDING,
HIGHER RATED BONDS. (SEE "INVESTMENT RISKS".)

Prior to May 1, 1997, the PPM America/JNL Balanced Series was the
JNL/Phoenix Investment Counsel Balanced Series, the JNL/Putnam Growth Series was
the JNL/Phoenix Investment Counsel Growth Series and the JNL/Putnam Value Equity
Series was the PPM America/JNL Value Equity Series.
------------------------

THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES
AND EXCHANGE COMMISSION NOR HAS THE COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
------------------------

THE STATEMENT OF ADDITIONAL INFORMATION, DATED JANUARY 2, 1998, IS INCORPORATED
HEREIN BY REFERENCE.

2
<PAGE> 3

- --------------------------------------------------------------------------------

TABLE OF CONTENTS
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
TOPIC PAGE
----- ----
<S> <C>
TRUST EXPENSES.............................................. 4

FINANCIAL HIGHLIGHTS........................................ 6

INVESTMENT OBJECTIVES AND POLICIES.......................... 13

COMMON TYPES OF SECURITIES AND MANAGEMENT PRACTICES......... 27

MANAGEMENT OF THE TRUST..................................... 36

INVESTMENT IN TRUST SHARES.................................. 44

SHARE REDEMPTION............................................ 44

ADDITIONAL INFORMATION...................................... 45

PERFORMANCE ADVERTISING FOR THE SERIES...................... 46

TAX STATUS.................................................. 47
</TABLE>

3
<PAGE> 4

- --------------------------------------------------------------------------------

TRUST EXPENSES
- --------------------------------------------------------------------------------

SHAREHOLDER TRANSACTION EXPENSES

<TABLE>
<S> <C>
MAXIMUM SALES LOAD IMPOSED ON PURCHASES NONE
MAXIMUM SALES LOAD IMPOSED ON REINVESTED DIVIDENDS NONE
DEFERRED SALES LOAD NONE
REDEMPTION FEES NONE
EXCHANGE FEE NONE
</TABLE>

ANNUAL SERIES OPERATING EXPENSES
(As a percentage of average net assets.)

<TABLE>
<CAPTION>
OTHER
MANAGEMENT EXPENSES(AFTER TOTAL SERIES
FEE REIMBURSEMENT) OPERATING EXPENSES
---------- -------------- ------------------
<S> <C> <C> <C>
JNL Aggressive Growth Series.............................. .95% .15% 1.10%
JNL Capital Growth Series................................. .95% .15% 1.10%
JNL Global Equities Series................................ 1.00% .15% 1.15%
JNL/Alger Growth Series................................... .975% .15% 1.125%
JNL/Putnam Growth Series*................................. .90% .15% 1.05%
JNL/Putnam Value Equity Series*........................... .90% .15% 1.05%
PPM America/JNL Balanced Series*.......................... .75% .15% .90%
PPM America/JNL High Yield Bond Series.................... .75% .15% .90%
PPM America/JNL Money Market Series....................... .60% .15% .75%
Salomon Brothers/JNL Global Bond Series................... .85% .15% 1.00%
Salomon Brothers/JNL U.S. Government & Quality Bond
Series.................................................. .70% .15% .85%
T. Rowe Price/JNL Established Growth Series............... .85% .15% 1.00%
T. Rowe Price/JNL International Equity Investment
Series.................................................. 1.10% .15% 1.25%
T. Rowe Price/JNL Mid-Cap Growth Series................... .95% .15% 1.10%
</TABLE>

*The management fees for the JNL/Putnam Growth Series, JNL/Putnam Value
Equity Series and the PPM America/JNL Balanced Series were changed effective May
1, 1997. See "Management of the Trust." The changes represent an increase in
management fees for the JNL/Putnam Growth Series when net assets exceed $50
million, an increase in management fees for the JNL/Putnam Value Equity Series
at all net asset levels and a decrease in management fees for the PPM
America/JNL Balanced Series at all net asset levels.

Currently, Jackson National Financial Services, Inc. will reimburse each of
the Series for annual expenses (excluding Management Fees) in excess of .15% of
average daily net assets. Voluntary reimbursements to these Series may be
modified or discontinued at any time. Prior to reimbursement, Total Series
Operating Expenses as a percentage of net assets for the period ended December
31, 1996, were: JNL Aggressive Growth Series -- 1.40%; JNL Capital Growth Series
- -- 1.27%; JNL Global Equities Series -- 1.63%; JNL/Alger Growth Series -- 1.19%;
JNL/Putnam Growth Series -- 1.27%; JNL/Putnam Value Equity Series -- 1.53%; PPM
America/JNL Balanced Series -- 1.22%; PPM America/JNL High Yield Bond Series --
1.21%; PPM America/JNL Money Market Series -- .85%; Salomon Brothers/JNL Global
Bond Series -- 1.44%; Salomon Brothers/JNL U.S. Government & Quality Bond Series
- -- 1.37%; T. Rowe Price/JNL Established Growth Series -- 1.11%; T. Rowe
Price/JNL International Equity Investment Series -- 1.29%; and T. Rowe Price/JNL
Mid-Cap Growth Series -- 1.14%.

4
<PAGE> 5

EXAMPLE -

The following example illustrates the expenses you would incur on a $1,000
investment, assuming (1) 5% annual return and (2) redemption at the end of each
time period:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
JNL Aggressive Growth Series................................ $11 $35 $61 $134
JNL Capital Growth Series................................... $11 $35 $61 $134
JNL Global Equities Series.................................. $12 $37 $63 $140
JNL/Alger Growth Series..................................... $11 $36 $62 $137
JNL/Putnam Growth Series.................................... $11 $33 $58 $128
JNL/Putnam Value Equity Series.............................. $11 $33 $58 $128
PPM America/JNL Balanced Series............................. $ 9 $29 $50 $111
PPM America/JNL High Yield Bond Series...................... $ 9 $29 $50 $111
PPM America/JNL Money Market Series......................... $ 8 $24 $42 $93
Salomon Brothers/JNL Global Bond Series..................... $10 $32 $55 $122
Salomon Brothers/JNL U.S. Government & Quality Bond
Series.................................................... $ 9 $27 $47 $105
T. Rowe Price/JNL Established Growth Series................. $10 $32 $55 $122
T. Rowe Price/JNL International Equity Investment Series.... $13 $40 $69 $151
T. Rowe Price/JNL Mid-Cap Growth Series..................... $11 $35 $61 $134
</TABLE>

The purpose of this table is to assist you in understanding the various
costs and expenses that you will bear directly or indirectly. The example
assumes a 5% annual rate of return pursuant to the requirements of the
Securities and Exchange Commission. This hypothetical rate of return is not
intended to be representative of past or future performance of the Series.

5
<PAGE> 6

- --------------------------------------------------------------------------------

FINANCIAL HIGHLIGHTS
- --------------------------------------------------------------------------------
The following table provides selected per share data for one share of each
Series. The information does not reflect any charges imposed by a separate
account investing in shares of the Series. You should refer to the appropriate
separate account prospectus for additional information regarding such charges.

The information for the period from April 1, 1996 (or, if later, the
commencement of operation of the Series) to December 31, 1996, has been audited
by Price Waterhouse LLP, independent accountants, and should be read in
conjunction with the financial statements and notes thereto, together with the
report of Price Waterhouse LLP thereon, in the Annual Report included in the
Statement of Additional Information. The information for the six months ended
June 30, 1997 is unaudited and should be read in conjunction with the financial
statements and notes thereto included in the Semi-Annual Report, included in the
Statement of Additional Information.

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
JNL AGGRESSIVE GROWTH SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD........................ $13.38 $13.13 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)................................ 0.06 0.05 0.01
Net realized and unrealized gains on investments and foreign
currency related items.................................... 0.76 1.10 3.53
------- ------- ------
Total income from investment operations..................... 0.82 1.15 3.54
------- ------- ------
LESS DISTRIBUTIONS:
From net investment income.................................. -- (0.05) --
From net realized gains on investment transactions.......... -- (0.71) (0.41)
Return of capital........................................... -- (0.14) --
------- ------- ------
Total distributions......................................... -- (0.90) (0.41)
------- ------- ------
Net increase................................................ 0.82 0.25 3.13
------- ------- ------
NET ASSET VALUE, END OF PERIOD.............................. $14.20 $13.38 $13.13
======= ======= ======
TOTAL RETURN(A)............................................. 6.13% 8.72% 35.78%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................... $62,173 $29,555 $8,527
Ratio of net operating expenses to average net
assets(b)(c).............................................. 1.10% 1.09% 1.09%
Ratio of net investment income to average net
assets(b)(c).............................................. 1.29% 0.77% 0.27%
Ratio of interest expense and dividends on short positions
to average net assets(b).................................. -- -- --
Portfolio turnover.......................................... 75.11% 85.22% 163.84%
Average commission rate paid(d)............................. $0.0262 $0.0242 n/a
RATIO INFORMATION ASSUMING NO EXPENSE REIMBURSEMENT OR FEES
PAID INDIRECTLY
Ratio of expenses to average net assets(b).................. 1.24% 1.40% 2.77%
Ratio of net investment income to average net assets(b)..... 1.15% 0.46% (1.41)%
</TABLE>

See notes to the financial statements.

6
<PAGE> 7

<TABLE>
<CAPTION>
JNL CAPITAL GROWTH SERIES JNL GLOBAL EQUITIES SERIES JNL/ALGER GROWTH SERIES
----------------------------------------- ----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15, ENDED APRIL 1, OCTOBER 16,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
----------- ------------ ------------ ----------- ------------ ------------ ----------- ------------ ------------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
$14.46 $13.86 $10.00 $15.20 $13.75 $10.00 $11.16 $10.38 $10.00
(0.03) 0.06 -- 0.10 0.03 0.10 -- -- --
0.72 0.70 4.70 2.60 2.72 4.02 1.87 0.78 0.38
------- ------- ------ -------- ------- ------- ------- ------- ------
0.69 0.76 4.70 2.70 2.75 4.12 1.87 0.78 0.38
------- ------- ------ -------- ------- ------- ------- ------- ------
-- -- -- -- (0.08) -- -- -- --
-- (0.16) (0.84) -- (0.90) (0.37) -- -- --
-- -- -- -- (0.32) -- -- -- --
------- ------- ------ -------- ------- ------- ------- ------- ------
-- (0.16) (0.84) -- (1.30) (0.37) -- -- --
------- ------- ------ -------- ------- ------- ------- ------- ------
0.69 0.60 3.86 2.70 1.45 3.75 1.87 0.78 0.38
------- ------- ------ -------- ------- ------- ------- ------- ------
$15.15 $14.46 $13.86 $17.90 $15.20 $13.75 $13.03 $11.16 $10.38
======= ======= ====== ======== ======= ======= ======= ======= ======
4.77% 5.45% 47.94% 17.76% 19.99% 41.51% 16.76% 7.51% 3.80%
$60,969 $36,946 $9,578 $112,333 $48,638 $16,141 $63,109 $38,252 $8,649
1.10% 1.09% 1.09% 1.15% 1.14% 1.15% 1.125% 1.07% 1.03%
(0.11)% 0.91% (0.49)% 1.35% 0.37% 0.39% (0.07)% (0.02)% (0.17)%
-- -- -- -- -- -- -- -- --
51.45% 115.88% 128.56% 40.70% 52.02% 142.36% 51.91% 59.92% 50.85%
$0.0367 $0.0196 n/a $ 0.0043 $0.0162 n/a $0.0720 $0.0441 n/a
1.19% 1.27% 2.08% 1.35% 1.63% 2.25% 1.15% 1.19% 1.89%
(0.20)% 0.73% (1.48)% 1.15% (0.12)% (0.71)% (0.09)% (0.14)% (1.03)%
</TABLE>

7
<PAGE> 8

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

<TABLE>
<CAPTION>
JNL/PUTNAM GROWTH SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD........................ $14.21 $12.50 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)................................ 0.03 0.04 0.01
Net realized and unrealized gains on investments and foreign
currency related items.................................... 1.26 2.12 3.66
------- ------- ------
Total income from investment operations..................... 1.29 2.16 3.67
------- ------- ------
LESS DISTRIBUTIONS:
From net investment income.................................. -- (0.05) --
From net realized gains on investment transactions.......... -- (0.40) (1.17)
Return of capital........................................... -- -- --
------- ------- ------
Total distributions......................................... -- (0.45) (1.17)
------- ------- ------
Net increase................................................ 1.29 1.71 2.50
------- ------- ------
NET ASSET VALUE, END OF PERIOD.............................. $15.50 $14.21 $12.50
======= ======= ======
TOTAL RETURN(A)............................................. 9.08% 17.28% 37.69%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................... $60,325 $22,804 $2,518
Ratio of net operating expenses to average net
assets(b)(c)(e)........................................... 1.05% 1.04% 0.95%
Ratio of net investment income to average net
assets(b)(c).............................................. 0.63% 0.94% 0.28%
Ratio of interest expense and dividends on short positions
to average net assets(b).................................. 0.25% -- --
Portfolio turnover.......................................... 220.95% 184.33% 255.03%
Average commission rate paid(d)............................. $0.0481 $0.0175% n/a
RATIO INFORMATION ASSUMING NO EXPENSE REIMBURSEMENT OR FEES
PAID INDIRECTLY
Ratio of expenses to average net assets(b)(f)............... 1.10% 1.27% 5.38%
Ratio of net investment income to average net assets(b)..... 0.58% 0.71% (4.15)%
</TABLE>

- -------------------------
* Commencement of operations.
(a) Assumes investment at net asset value at the beginning of the period,
reinvestment of all distributions, and a complete redemption of the
investment at the net asset value at the end of the period. Total return is
not annualized.
(b) Annualized.
(c) Computed after giving effect to the Advisor's expense reimbursement and fees
paid indirectly.
(d) Disclosure required for fiscal years beginning after September 1, 1995.
(e) For the JNL/Putnam Growth Series during the six months ended June 30, 1997,
the net operating expense ratio excludes interest expense and dividends on
short positions. The ratio including interest expense and dividends on short
positions during the six months ended June 30, 1997 was 1.25%.
(f) For the JNL/Putnam Growth Series during the six months ended June 30, 1997,
the expense ratio excludes interest expense and dividends on short
positions. The ratio including interest expense and dividends on short
positions during the six months ended June 30, 1997 was 1.30%.

See notes to the financial statements.

8
<PAGE> 9

<TABLE>
<CAPTION>
PPM AMERICA/JNL
JNL/PUTNAM VALUE EQUITY SERIES PPM AMERICA/JNL BALANCED SERIES HIGH YIELD BOND SERIES
----------------------------------------- ----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
----------- ------------ ------------ ----------- ------------ ------------ ----------- ------------ ------------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
$14.50 $12.77 $10.00 $11.92 $11.17 $10.00 $10.67 $10.23 $10.00
0.09 0.10 0.23 0.16 0.10 0.25 0.30 0.51 0.73
1.92 1.97 2.86 0.95 0.98 1.40 0.41 0.64 0.04
------- ------- ------ ------- ------- ------ ------- ------- ------
2.01 2.07 3.09 1.11 1.08 1.65 0.71 1.15 0.77
------- ------- ------ ------- ------- ------ ------- ------- ------
-- (0.15) (0.17) -- (0.15) (0.19) -- (0.69) (054)
-- (0.19) (0.15) -- (0.18) (0.29) -- (0.02) --
-- -- -- -- -- -- -- -- --
------- ------- ------ ------- ------- ------ ------- ------- ------
-- (0.34) (0.32) -- (0.33) (0.48) -- (0.71) (0.54)
------- ------- ------ ------- ------- ------ ------- ------- ------
2.01 1.73 2.77 1.11 0.75 1.17 0.71 0.44 0.23
------- ------- ------ ------- ------- ------ ------- ------- ------
$16.51 $14.50 $12.77 $13.03 $11.92 $11.17 $11.38 $10.67 $10.23
======= ======= ====== ======= ======= ====== ======= ======= ======
13.86% 16.25% 31.14% 9.31% 9.72% 16.60% 6.65% 11.24% 7.82%
$53,953 $17,761 $3,365 $42,495 $24,419 $4,761 $38,728 $13,396 $6,156
0.97% 0.85% 0.87% 0.99% 1.04% 1.01% 0.90% 0.88% 0.88%
2.02% 2.29% 2.33% 3.28% 2.39% 2.99% 8.33% 8.64% 8.34%
-- -- -- -- -- -- -- -- --
92.65% 13.71% 30.12% 121.49% 158.15% 115.84% 94.25% 113.08% 186.21%
$0.0370 $0.0259 n/a $0.0347 $0.0494 n/a n/a n/a n/a
1.12% 1.53% 2.28% 1.09% 1.22% 3.71% 0.98% 1.21% 1.50%
1.87% 1.61% 0.91% 3.18% 2.21% 0.29% 8.25% 8.31% 7.72%
</TABLE>

9
<PAGE> 10

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

<TABLE>
<CAPTION>
PPM AMERICA/
JNL MONEY MARKET SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD........................ $1.00 $1.00 $1.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)................................ 0.02 0.04 0.04
Net realized and unrealized gains on investments and foreign
currency related items.................................... -- -- --
------- ------- ------
Total income from investment operations..................... 0.02 0.04 0.04
------- ------- ------
LESS DISTRIBUTIONS:
From net investment income.................................. (0.02) (0.04) (0.04)
From net realized gains on investment transactions.......... -- -- --
Return of capital........................................... -- -- --
------- ------- ------
Total distributions......................................... (0.02) (0.04) (0.04)
------- ------- ------
Net increase................................................ -- -- --
------- ------- ------
NET ASSET VALUE, END OF PERIOD.............................. $1.00 $1.00 $1.00
======= ======= ======
TOTAL RETURN(A)............................................. 2.41% 3.61% 4.59%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................... $37,856 $23,752 $6,816
Ratio of net operating expenses to average net
assets(b)(c).............................................. 0.75% 0.75% 0.75%
Ratio of net investment income to average net
assets(b)(c).............................................. 4.85% 4.75% 5.06%
Ratio of interest expense and dividends on short positions
to average net assets(b).................................. -- -- --
Portfolio turnover.......................................... -- -- --
Average commission rate paid(d)............................. n/a n/a n/a
RATIO INFORMATION ASSUMING NO EXPENSE REIMBURSEMENT OR FEES
PAID INDIRECTLY
Ratio of expenses to average net assets(b).................. 0.80% 0.85% 1.30%
Ratio of net investment income to average net assets(b)..... 4.80% 4.65% 4.51%
</TABLE>

See notes to the financial statements.

10
<PAGE> 11
<TABLE>
<CAPTION>
SALOMON BROTHERS/ SALOMON BROTHERS/JNL U.S.
JNL GLOBAL BOND SERIES GOVERNMENT & QUALITY BOND SERIES
----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
----------- ------------ ------------ ----------- ------------ ------------
<S> <C> <C> <C> <C> <C>
$ 10.63 $ 10.46 $10.00 $ 10.20 $10.09 $10.00
0.27 0.42 0.81 0.24 0.24 0.45
0.31 0.70 0.24 -- 0.24 0.02
------- ------- ------ ------- ------ ------
0.58 1.12 1.05 0.24 0.48 0.47
------- ------- ------ ------- ------ ------
-- (0.69) (0.56) -- (0.34) (0.34)
-- (0.26) (0.03) -- (0.03) (0.04)
-- -- -- -- -- --
------- ------- ------ ------- ------ ------
-- (0.95) (0.59) -- (0.37) (0.38)
------- ------- ------ ------- ------ ------
0.58 0.17 0.46 0.24 0.11 0.09
------- ------- ------ ------- ------ ------
$11.21 $10.63 $10.46 $10.44 $10.20 $10.09
------- ------- ------ ======= ====== ======
5.46% 10.68% 10.74% 2.35% 4.82% 4.65%
$26,366 $12,483 $6,380 $17,401 $9,832 $3,007
1.00% 0.99% 1.00% 0.85% 0.84% 0.84%
7.21% 7.52% 9.01% 6.11% 5.72% 5.41%
-- -- -- -- -- --
84.42% 109.85% 152.89% 152.20% 218.50% 253.37%
n/a n/a n/a n/a n/a n/a
1.36% 1.44% 2.14% 1.09% 1.37% 2.53%
6.85% 7.07% 7.87% 5.87% 5.19% 3.72%

<CAPTION>
T. ROWE PRICE/JNL
ESTABLISHED GROWTH SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C>
$ 12.56 $ 11.36 $10.00
0.03 0.03 0.07
2.18 1.81 2.68
------- ------- ------
2.21 1.84 2.75
------- ------- ------
-- (0.04) (0.06)
-- (0.09) (1.33)
-- (0.51) --
------- ------- ------
-- (0.64) (1.39)
------- ------- ------
2.21 1.20 1.36
------- ------- ------
$ 14.77 $ 12.56 $11.36
======= ======= ======
17.60% 16.12% 28.23%
$80,998 $32,291 $8,772
1.00% 1.00% 1.00%
0.60% 0.59% 0.75%
-- -- --
36.76% 36.41% 101.13%
$0.0349 $0.0288 n/a
1.04% 1.11% 1.11%
0.56% 0.48% 0.48%
</TABLE>

11
<PAGE> 12

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

<TABLE>
<CAPTION>
T. ROWE PRICE/JNL INTERNATIONAL T. ROWE PRICE/JNL
EQUITY INVESTMENT SERIES MID-CAP GROWTH SERIES
----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
----------- ------------ ------------ ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF
PERIOD............................ $12.08 $11.25 $10.00 $14.89 $13.43 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)........ 0.08 0.06 0.04 (0.01) (0.05) 0.06
Net realized and unrealized gains on
investments and foreign currency
related items..................... 1.32 0.90 1.21 0.92 1.92 3.90
------- ------- ------- ------- ------- -------
Total income from investment
operations........................ 1.40 0.96 1.25 0.91 1.87 3.96
------- ------- ------- ------- ------- -------
LESS DISTRIBUTIONS:
From net investment income.......... -- (0.12) -- -- (0.05) --
From net realized gains on
investment transactions........... -- (0.01) -- -- (0.36) (0.53)
Return of capital................... -- -- -- -- -- --
------- ------- ------- ------- ------- -------
Total distributions................. -- (0.13) -- -- (0.41) (0.53)
------- ------- ------- ------- ------- -------
Net increase........................ 1.40 0.83 1.25 0.91 1.46 3.43
------- ------- ------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD...... $13.48 $12.08 $11.25 $15.80 $14.89 $13.43
======= ======= ======= ======= ======= =======
TOTAL RETURN(A)..................... 11.59% 8.54% 12.50% 6.11% 13.91% 40.06%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in
thousands)........................ $74,486 $48,204 $24,211 $91,573 $47,104 $10,545
Ratio of net operating expenses to
average net assets(b)(c).......... 1.24% 1.25% 1.25% 1.10% 1.10% 1.10%
Ratio of net investment income to
average net assets(b)(c).......... 1.59% 1.09% 0.78% (0.21)% (0.81)% 0.82%
Ratio of interest expense and
dividends on short positions to
average net assets(b)............. -- -- -- -- -- --
Portfolio turnover.................. 7.86% 5.93% 16.45% 22.65% 25.05% 66.04%
Average commission rate paid(d)..... $0.0018 $0.0257 n/a $0.0487 $0.0326 n/a
RATIO INFORMATION ASSUMING NO
EXPENSE REIMBURSEMENT OR FEES PAID
INDIRECTLY
Ratio of expenses to average net
assets(b)......................... 1.38% 1.29% 2.14% 1.12% 1.14% 2.10%
Ratio of net investment income to
average net assets(b)............. 1.45% 1.05% (0.11)% (0.23)% (0.22)% (0.18)%
</TABLE>

Each Series' recent performance and holdings will be detailed twice a year
in the Trust's annual and semi-annual reports, which are sent to all
shareholders.

See notes to the financial statements.

12
<PAGE> 13

- --------------------------------------------------------------------------------
INVESTMENT OBJECTIVES AND POLICIES
- --------------------------------------------------------------------------------

Investments in each Series are made in many different securities which
provide diversification to minimize risk. While there is careful selection of
portfolio securities and constant supervision by a team of professional
investment managers, there can be no guarantee that the Series' objectives will
be achieved. Because of differences in investment objectives and policies, as
well as acceptable degrees of risk, the performance of a Series may differ even
though more than one Series may utilize the same securities selection.

Unless otherwise stated, the investment objectives and policies set forth
in this Prospectus are not fundamental and may be changed by the Trustees
without shareholder approval. Each Series is subject to additional investment
policies and restrictions described in the Statement of Additional Information,
some of which are fundamental and may not be changed without shareholder
approval.

Currently, shares of the Trust are sold to life insurance company separate
accounts ("Accounts") to fund the benefits of variable annuity policies
("Policies") issued by life insurance companies. The Accounts purchase shares of
the Trust in accordance with variable account allocation instructions received
from owners of the Policies. The Trust then uses the proceeds to buy securities
for its Series. The investment adviser manages the Series from day to day to
accomplish the Trust's investment objectives. The kinds of investments and the
way they are managed depends on what is happening in the economy and the
financial marketplaces. Each of the Accounts, as a shareholder, has an ownership
in the Trust's investments. The Trust also offers to buy back (redeem) shares of
the Trust from the Accounts at any time at net asset value.

Jackson National Financial Services, Inc. ("JNFSI"), a wholly owned
subsidiary of Jackson National Life Insurance Company, serves as investment
adviser for all the Series of the Trust. Janus Capital Corporation serves as
sub-adviser for the JNL Capital Growth, JNL Aggressive Growth and JNL Global
Equities Series; Fred Alger Management, Inc. serves as sub-adviser for the
JNL/Alger Growth Series; Putnam Investment Management, Inc. serves as sub-
adviser for the JNL/Putnam Growth and JNL/Putnam Value Equity Series; PPM
America, Inc. serves as sub-adviser for the PPM America/JNL Balanced, PPM
America/JNL High Yield Bond and PPM America/ JNL Money Market Series; Salomon
Brothers Asset Management Inc serves as sub-adviser for Salomon Brothers/JNL
Global Bond and Salomon Brothers/ JNL U.S. Government & Quality Bond Series; T.
Rowe Price Associates, Inc. serves as sub-adviser for the T. Rowe Price/JNL
Established Growth and T. Rowe Price/JNL Mid-Cap Growth Series; and Rowe
Price-Fleming International, Inc. serves as sub-adviser for the T. Rowe
Price/JNL International Equity Investment Series.

Reference is made herein to ratings assigned to certain types of securities
by Standard & Poor's Ratings Group ("S&P"), Moody's Investors Service, Inc.
("Moody's"), Fitch Investors Service, Inc. ("Fitch"), Duff & Phelps, Inc. ("Duff
& Phelps") and Thomson BankWatch, Inc., recognized independent securities
ratings institutions. A description of the ratings categories assigned by S&P
and Moody's is contained in Appendix A.

DIVERSIFICATION

Each of the Series except the JNL Capital Growth and JNL Aggressive Growth
Series qualifies as a diversified investment company under the Investment
Company Act of 1940 (the "1940 Act"). As a fundamental policy, a diversified
fund will not purchase a security of any issuer (except cash items and U.S.
Government securities) if a) it would cause the Series to own more than 10% of
the outstanding voting securities of that issuer or b) it would cause the
Series' holdings of that issuer to amount to more than 5% of the Series' total
assets (as applied in each case to 75% of the Series' total assets). As a
fundamental policy, the JNL Capital Growth and JNL Aggressive Growth Series also
will not purchase more than 10% of the outstanding voting securities of any
issuer; however, only 50% of total assets are subject to the 5% test. The JNL
Capital

13
<PAGE> 14

Growth and JNL Aggressive Growth Series may invest up to 50% of total assets in
the securities of as few as two issuers (not to exceed 25% in any one issuer)
while the other Series may invest up to 25% of their total assets in the
securities of one issuer. Neither the JNL Capital Growth nor the JNL Aggressive
Growth Series anticipates concentrating its holdings in so few issuers unless
its sub-adviser believes a security has the potential for substantial capital
appreciation consistent with a Series' investment policies and goals. To the
extent that any Series invests more than 5% of its assets in a particular
issuer, its exposure to credit risks and/or market risks associated with that
issuer increases. As an additional fundamental policy, no Series will invest
more than 25% of its total assets in any particular industry (other than U.S.
Government securities), except that the PPM America/JNL Money Market Series may
invest a greater percent of its assets in the domestic banking industry.

INTERNAL REVENUE SERVICE (IRS) LIMITATIONS

In addition to the diversification requirements stated above, each Series
intends to comply with the diversification requirements currently imposed by the
IRS on separate accounts of insurance companies as a condition of maintaining
the tax-deferred status of variable contracts. More specific information may be
contained in the participating insurance company's separate account prospectus.

- --------------------------------------------------------------------------------
JNL AGGRESSIVE GROWTH SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL Aggressive Growth Series is long-term
growth of capital. It is a non-diversified Series that pursues its investment
objective by investing primarily in common stocks of issuers of any size,
including larger, well-established companies and smaller, emerging growth
companies. The smaller or newer a company is, the more likely it may be to
suffer more significant losses as well as realize more substantial growth than
larger or more established issuers.

- --------------------------------------------------------------------------------
JNL CAPITAL GROWTH SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL Capital Growth Series is long-term
growth of capital in a manner consistent with the preservation of capital. It is
a non-diversified Series that pursues its investment objective by normally
investing at least 50% of its equity assets in securities issued by medium-sized
companies. Medium-sized companies are those whose market capitalizations fall
within the range of companies in the S&P MidCap 400 Index (the "MidCap Index").
Companies whose capitalization falls outside this range after the Series'
initial purchase continue to be considered medium-sized companies for the
purpose of this policy. As of December 30, 1996, the MidCap Index included
companies with capitalizations between approximately $192 million and $6.5
billion. The range of the MidCap Index is expected to change on a regular basis.
Subject to the above policy, the Series may also invest in smaller or larger
issuers.

- --------------------------------------------------------------------------------
JNL GLOBAL EQUITIES SERIES
- --------------------------------------------------------------------------------

14
<PAGE> 15

primarily through investments in common stocks of foreign and domestic issuers.
The Series is permitted to invest on a worldwide basis in companies and other
organizations of any size, regardless of country of organization or place of
principal business activity, as well as domestic and foreign governments,
government agencies and other governmental entities. The Series normally invests
in securities of issuers from at least five different countries, including the
United States, although the Series may at times invest all of its assets in
fewer than five countries. The JNL Global Equities Series may not be suitable
for investors that are not able to bear the additional risks associated with the
Series' more extensive holdings of foreign securities.

- --------------------------------------------------------------------------------
JNL AGGRESSIVE GROWTH SERIES, JNL CAPITAL GROWTH SERIES,
JNL GLOBAL EQUITIES SERIES
- --------------------------------------------------------------------------------

Each of the JNL Aggressive Growth, JNL Capital Growth, and JNL Global
Equities Series invests substantially all of its assets in common stocks when
its sub-adviser believes that the relevant market environment favors profitable
investing in those securities. Common stock investments are selected in
industries and companies that the sub-adviser believes are experiencing
favorable demand for their products and services, and which operate in a
favorable competitive environment and regulatory climate. The sub-adviser's
analysis and selection process focuses on stocks with earnings growth potential
that may not be recognized by the market. Such securities are selected primarily
for their capital growth potential; investment income is not a consideration.
These selection criteria apply equally to stocks of foreign issuers. In
addition, factors such as expected levels of inflation, government policies
influencing business conditions, the outlook for currency relationships, and
prospects for relative economic growth among countries, regions or geographic
areas may warrant greater consideration in selecting foreign stocks.

Each of the JNL Aggressive Growth, JNL Capital Growth and JNL Global
Equities Series invests primarily in common stocks of foreign and domestic
companies. Each Series may invest to a lesser degree in other types of
securities, including preferred stock, warrants, convertible securities and debt
securities. Debt securities that the Series may purchase include corporate bonds
and debentures (not to exceed 35% of net assets in high-yield/high-risk bonds)
(See "Investment Risks -- High Yield/High Risk Bonds"); government securities;
mortgage- and asset-backed securities (not to exceed 25% of assets); zero coupon
bonds (not to exceed 10% of assets); indexed/structured notes; high-grade
commercial paper; certificates of deposit; and repurchase agreements. Such
securities may offer growth potential because of anticipated changes in interest
rates, credit standing, currency relationships or other factors. Each of these
Series may also invest in short-term debt securities as a means of receiving a
return on idle cash.

When the Series' sub-adviser believes that market conditions are not
favorable for profitable investing or when the sub-adviser is otherwise unable
to locate favorable investment opportunities, the Series' investments may be
hedged to a greater degree and/or its cash or similar investments may increase.
In other words, the Series do not always stay fully invested in stocks and
bonds. Cash or similar investments are residual -- they represent the assets
that remain after the sub-adviser has committed available assets to desirable
investment opportunities. When a Series' cash position increases, it may not
participate in stock market advances or declines to the extent that it would if
it remained more fully invested in common stocks.

Although JNL Global Equities Series is committed to foreign investing, each
of these Series may invest without limit in equity and debt securities of
foreign issuers. The Series may invest directly in foreign securities
denominated in a foreign currency and not publicly traded in the United States.
Other ways of investing in foreign securities include depositary receipts or
shares, and passive foreign investment companies. Each of these Series may use
futures, options and other

15
<PAGE> 16

derivatives for hedging purposes or as a means of enhancing return. Some
securities that these Series may purchase may be issued on a when-issued,
delayed delivery or forward commitment basis.

Each of JNL Aggressive Growth, JNL Capital Growth and JNL Global Equities
Series may invest in "special situations" from time to time. A special situation
arises when, in the opinion of the sub-adviser, the securities of a particular
issuer will be recognized and appreciate in value due to a specific development
with respect to that issuer. Developments creating special situations might
include, among others, a new product or process, a technological breakthrough, a
management change or other extraordinary corporate event, or differences in
market supply of and demand for the security. Investment in special situations
may carry an additional risk of loss in the event that the anticipated
development does not occur or does not attract the expected attention. The
impact of this strategy on a Series will depend on the Series' size and the
extent of its holdings of special situation issuers relative to total net
assets.

- --------------------------------------------------------------------------------
JNL/ALGER GROWTH SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL/Alger Growth Series is long-term
capital appreciation. It is a diversified Series that seeks to achieve its
objective by investing in equity securities, such as common or preferred stocks
that are listed on a national securities exchange, or securities convertible
into or exchangeable for equity securities, including warrants and rights.
Except during temporary defensive periods, the Series invests at least 85
percent of its net assets in equity securities and at least 65 percent of its
total assets in equity securities of companies that, at the time of purchase of
the securities, have total market capitalization of $1 billion or greater.

It is anticipated that the Series will invest primarily in companies whose
securities are traded on domestic stock exchanges or in the over-the-counter
market. These companies may still be in the developmental stage, may be older
companies that appear to be entering a new stage of growth progress owing to
factors such as management changes or development of new technology, products or
markets or may be companies providing products or services with a high unit
volume growth rate. The Series may invest up to 35 percent of its total assets
in equity securities of companies that, at the time of purchase, have total
market capitalization of less than $1 billion. In order to afford the Series the
flexibility to take advantage of new opportunities for investments in accordance
with its investment objective, the Series may hold up to 15 percent of its net
assets in money market instruments and repurchase agreements. During temporary
defensive periods, the Series may invest up to 100% of its assets in debt
securities, money market instruments and/or repurchase agreements. The Portfolio
may also purchase restricted securities (subject to a limit on all illiquid
securities of 10 percent of net assets), lend its securities and enter into
"short sales against the box." (See "Common Types of Securities and Management
Practices").

- --------------------------------------------------------------------------------
JNL/PUTNAM GROWTH SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL/Putnam Growth Series is to seek
long-term capital growth. It is a diversified Series that pursues its investment
objective by retaining maximum flexibility in the management of the Series
consisting mainly of common stocks. Since income is not an objective, any income
generated by the investment of the Series' assets will be incidental to its
objective.

16
<PAGE> 17

The Series intends to invest primarily in the common stocks of companies
believed by the sub-adviser to have opportunities for capital growth. However,
since no one class or type of security at all times necessarily affords the
greatest promise for capital appreciation, the Series may invest any amount or
proportion of its assets in any class or type of security believed by the sub-
adviser to offer potential for capital appreciation over both the intermediate
and long term. Normally, of course, its investment will consist largely of
common stocks selected for the promise they offer of appreciation of capital.
However, the Series may also invest in preferred stocks, bonds, convertible
preferred stocks and convertible debentures if, in the judgment of the
sub-adviser, the investment would further its investment objectives. The Series
may invest up to 20% of its net assets in foreign securities. The Series may
also engage in certain options transactions and enter into financial futures
contracts and related options. Each security held will be monitored to determine
whether it is contributing to the basic objective of long-term growth of
capital.

The sub-adviser believes that a portfolio of such securities provides the
most effective way to obtain capital appreciation, but when, for temporary
defensive purposes (as when market conditions for growth stocks are adverse),
other types of investments appear advantageous on the basis of combined
considerations of risk and the protection of capital values, investments may be
made in fixed income securities with or without warrants or conversion features.
In addition, for such temporary defensive purposes, the Series may pursue a
policy of retaining cash or investing part or all of its assets in cash
equivalents.

To the extent that the Series holds bonds, it may be negatively affected by
adverse interest rate movements and credit quality. Generally, when interest
rates rise it may be expected that the value of bonds may decrease.

- --------------------------------------------------------------------------------
JNL/PUTNAM VALUE EQUITY SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL/Putnam Value Equity Series is capital
growth, with income as a secondary objective by investing primarily in common
stocks which the sub-adviser believes to be undervalued relative to underlying
asset value or earnings potential at the time of purchase. It is a diversified
Series that seeks superior market cycle total returns. The Series invests
primarily in the common stocks of large capitalization companies mainly
domiciled in the United States. Common stocks for this purpose include common
stocks and equivalents, such as securities convertible into common stocks and
securities having common stock characteristics, such as rights and warrants to
purchase common stocks. Under normal circumstances, the Series will invest at
least 65% of the value of its total assets in equity securities.

Companies considered attractive generally will have the following
characteristics: 1) stocks typically will have distinctly above average dividend
yields, and 2) the market prices of the stocks will be undervalued relative to
the normal earning power of the company. The thrust of this approach is to seek
investments where current investor enthusiasm is low, as reflected in their
valuations. Exposure is reduced when the investment community's perceptions
improve and the company approaches fair valuation.

The sub-adviser takes a long-term investment approach by placing a strong
emphasis on its ability to determine attractive values and does not try to
determine short-term changes in the general market level. It is anticipated that
the annual turnover rate of the Series will not exceed 100% in normal
circumstances. The Series may invest up to 25% of its total assets in the common
stocks of foreign issuers, including American Depositary Receipts.

17
<PAGE> 18

- --------------------------------------------------------------------------------
PPM AMERICA/JNL BALANCED SERIES
- --------------------------------------------------------------------------------

The investment objective of the PPM America/JNL Balanced Series is to seek
reasonable income, long-term capital growth and preservation of capital. It is a
diversified Series that intends to invest based on combined consideration of
risk, income, capital enhancement, and protection of capital value. The Series
may invest in any type or class of security. Normally, the Series will invest in
common stocks and fixed income securities; however, it may also invest in
securities convertible into common stocks. At least 25% of the value of its
assets will be invested in fixed income senior securities.

The Series may also engage in certain options transactions and enter into
financial futures contracts and related options for hedging purposes and may
invest in deferred or zero coupon debt obligations. In implementing the
investment objectives of this Series, the sub-adviser will select securities
believed to have potential for the production of current income, with emphasis
on securities that also have potential for capital enhancement. For temporary
defensive purposes when the sub-adviser believes that adverse market conditions
warrant, the Series may actively pursue a policy of retaining cash or investing
part or all of its assets in cash equivalents, such as government securities and
high grade commercial paper.

The Series will emphasize investments in investment grade fixed income
securities which are rated within the four highest categories by recognized
rating agencies, e.g., S&P and Moody's. However, the Series may take a modest
position in lower or non-rated fixed income securities, but the Series will not
invest more than 35% of its net assets, determined at the time of investment, in
high yield, high risk fixed income securities. The Series may invest in bonds
rated as low as Ca by Moody's or CC by S&P. A fixed income securities issue may
have its ratings reduced below the minimum permitted for purchase by the Series.
In that event the sub-adviser will determine whether the Series should continue
to hold such issue in its portfolio. If, in the sub-adviser's opinion, market
conditions warrant, the Series may increase its position in lower or non-rated
securities from time to time. The lower rated and non-rated convertible
securities are predominantly speculative with respect to the issuer's capacity
to repay principal and pay interest. Investment in lower rated and non-rated
convertible fixed income securities normally involves a greater degree of market
and credit risk than does investment in securities having higher ratings. The
price of these fixed income securities will generally move in inverse proportion
to interest rates. In addition, non-rated securities are often less marketable
than rated securities. To the extent that the Series holds any lower rated or
non-rated securities, it may be negatively affected by adverse economic
developments, increased volatility and lack of liquidity. (See "Investment Risks
- -- High Yield/High Risk Bonds").

- --------------------------------------------------------------------------------
PPM AMERICA/JNL HIGH YIELD BOND SERIES
- --------------------------------------------------------------------------------

The primary investment objective of the PPM America/JNL High Yield Bond
Series is a high level of current income; its secondary investment objective is
capital appreciation by investing in fixed income securities, with emphasis on
higher-yielding, higher-risk, lower-rated or unrated corporate bonds. It is a
diversified Series.

18
<PAGE> 19

of loss of income and principal due to default by the issuer than are
investments in lower-yielding, higher-rated bonds. (See "Investment Risks --
High Yield/High Risk Bonds").

High risk, high yield bonds generally include any bonds that are rated Ba
or below by Moody's or BB or below by S&P or that are unrated but considered by
the sub-adviser to be of equivalent credit quality. Bonds rated Ba or BB or
below are considered speculative. The Series may invest without limitation in
bonds rated as low as Ca by Moody's or C by S&P (or unrated but considered by
the sub-adviser to be of equivalent quality). In addition, the Series may invest
up to 10% of its total assets in bonds rated C by Moody's or D by S&P (or
unrated but considered by the sub-adviser to be of equivalent quality).
High-yield bonds are riskier than lower-yielding, higher-rated bonds.

In pursuing its secondary investment objective of capital appreciation, the
Series may purchase high yield bonds that are expected by the sub-adviser to
increase in value due to improvements in their credit quality or ratings or
anticipated declines in interest rates. In addition, the Series may invest for
this purpose up to 25% of its assets in equity securities, such as common
stocks, or other securities having common stock characteristics. Securities
designated as having common stock characteristics include, but are not limited
to, securities convertible into or exchangeable for common stock.

Treating high current income as its primary investment objective means that
the Series may forego opportunities that would result in capital gains and may
accept prudent risks to capital value, in each case to take advantage of
opportunities for higher current income.

Up to 25% of the Series' assets may be invested in securities of foreign
issuers, which are generally denominated in currencies other than the U.S.
dollar. The Series also has the ability to hold a portion of its assets in
foreign currencies and to enter into forward foreign currency exchange
contracts, currency options, currency and financial futures contracts, and
options on such futures contracts. The Series may enter into repurchase
agreements and firm commitment agreements and may purchase securities on a
when-issued basis. Investment in foreign securities also involves special risks.

Under normal market conditions, the Series will invest at least 65% of its
total assets in high risk, high yield bonds as described above. Subject to this
requirement, the Series may maintain assets in cash or cash equivalents,
including commercial bank obligations (certificates of deposit, which are
interest-bearing time deposits; bankers' acceptances, which are time drafts on a
commercial bank for which the bank accepts an irrevocable obligation to pay at
maturity; and demand or time deposits), commercial paper (short-term notes
issued by corporations or governmental bodies) and obligations issued or
guaranteed by the U.S. Government. The Series may adopt temporary defensive
position investment policies during adverse market, economic or other
circumstances that require immediate action to avoid losses. During periods when
and to the extent that the Series has assumed a temporary defensive position,
the Series may not be pursuing its investment objective.

- --------------------------------------------------------------------------------
PPM AMERICA/JNL MONEY MARKET SERIES
- --------------------------------------------------------------------------------

The investment objective of the PPM America/JNL Money Market Series is to
achieve as high a level of current income as is consistent with the preservation
of capital and maintenance of liquidity by investing in high quality, short-term
money market instruments. It is a diversified Series that pursues its investment
objective by investing mainly in debt, but the Series shall retain maximum
flexibility in the management of its portfolio.

The Series invests in high quality money market instruments. These
instruments are considered to be among the safest investments available because
of their short maturities, liquidity and high quality ratings.

19
<PAGE> 20

This Series will invest exclusively in the following types of high quality,
U.S. dollar denominated money market instruments that mature in 397 days or
less:

- Obligations issued or guaranteed as to principal and interest by the U.S.
Government, its agencies and instrumentalities.

- Obligations, such as time deposits, certificates of deposit and bankers
acceptances, issued by U.S. banks and savings banks that are members of
the Federal Deposit Insurance Corporation, including their foreign
branches and foreign subsidiaries, and issued by domestic and foreign
branches of foreign banks.

- Corporate obligations, including commercial paper, of domestic and
foreign issuers.

- Obligations issued or guaranteed by one or more foreign governments or
any of their political subdivisions, agencies or instrumentalities,
including obligations of supranational entities.

- Repurchase agreements on obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.

Investments are managed to meet the quality and diversification
requirements of the 1940 Act. Under Rule 2a-7 under the 1940 Act, the Series
must maintain a dollar-weighted average portfolio maturity of 90 days or less
and may only purchase U.S. dollar denominated instruments that are determined to
present minimal credit risks and that at the time of acquisition are rated in
the top two rating categories by the required number of nationally recognized
statistical rating organizations (at least two or, if only one rating agency has
rated the security, that one agency) or, if unrated, are deemed comparable in
quality. Determination of credit risks and quality will be made by the sub-
adviser in accordance with procedures adopted by the Trust's Board of Trustees.
The diversification requirements of Rule 2a-7 provide generally that the Series
may not at the time of acquisition invest more than 5% of its assets in
securities of any one issuer or invest more than 5% of its assets in securities
that have not been rated in the highest category by the required number of
rating agencies or, if unrated, have not been deemed comparable, except U.S.
Government securities and repurchase agreements on such securities. A more
complete description of the rating categories is set forth under Appendix A.

The Series may invest more than 25% of its total assets in the domestic
banking industry, which would cause the Series to be more exposed to the risks
of such industry. Bank obligations held by the Series do not benefit materially
from insurance from the Federal Deposit Insurance Corporation. The 25%
limitation does not apply to U.S. Government securities, including obligations
issued or guaranteed by its agencies or instrumentalities.

- --------------------------------------------------------------------------------
SALOMON BROTHERS/JNL GLOBAL BOND SERIES
- --------------------------------------------------------------------------------

The primary investment objective of the Salomon Brothers/JNL Global Bond
Series is to seek a high level of current income. As a secondary objective, the
Series will seek capital appreciation. It is a diversified Series. The Series
seeks to achieve its objectives by investing in a globally diverse portfolio of
fixed income investments and by giving the sub-adviser broad discretion to
deploy the assets among certain segments of the fixed income market that the
sub-adviser believes will best contribute to the achievement of the Series'
objectives. At any point in time, the sub-adviser will deploy the Series' assets
based on its analysis of current economic and market conditions and the relative
risks and opportunities present in the following market segments: U.S.
Government obligations, investment grade domestic corporate debt, high yield
domestic corporate debt securities, mortgage-backed securities and investment
grade and high yield foreign corporate and sovereign debt securities. The
sub-adviser has entered into an agreement with its London-based affiliate,
Salomon Brothers Asset Management Limited ("SBAM Limited") pursuant to which
SBAM Limited will provide certain advisory

20
<PAGE> 21

services to the sub-adviser relating to currency transactions and investments in
non-dollar denominated debt securities for the benefit of the Series.

The sub-adviser will determine the amount of assets to be allocated to each
type of security in which it invests based on its assessment of the maximum
level of income and capital appreciation that can be achieved from a portfolio
which is invested in these securities. In making this determination, the
sub-adviser will rely in part on quantitative analytical techniques that measure
relative risks and opportunities of each type of security based on current and
historical economic, market, political and technical data for each type of
security, as well as on its own assessment of economic and market conditions
both on a global and local (country) basis. In performing quantitative analysis,
the sub-adviser will employ prepayment analysis and option adjusted spread
technology to evaluate mortgage securities, mean variance optimization models to
evaluate foreign debt securities, and total rate of return analysis to measure
relative risks and opportunities in other fixed income markets. Economic factors
considered will include current and projected levels of growth and inflation,
balance of payments, status and monetary policy. The allocation of assets to
foreign debt securities will further be influenced by current and expected
currency relationships and political and sovereign factors. The sub-adviser will
continuously review this allocation of assets and make such adjustments as it
deems appropriate. The Series does not plan to establish a minimum or a maximum
percentage of the assets which it will invest in any particular type of fixed
income security.

In addition, the sub-adviser will have discretion to select the range of
maturities of the various fixed income securities in which the Series invests.
The sub-adviser anticipates that under current market conditions the Series'
portfolio securities will have a weighted average life of 6 to 10 years.
However, the weighted average life of the portfolio securities may vary
substantially from time to time depending on economic and market conditions. The
Series may adopt temporary defensive position investment policies during adverse
market, economic or other circumstances that require immediate action to avoid
losses. During periods when and to the extent that the Series has assumed a
temporary defensive position, the Series may not be pursuing its investment
objective.

The investment grade corporate debt securities and the investment grade
foreign debt securities to be purchased by the Series are domestic and foreign
debt securities rated within the four highest bond ratings of either Moody's or
S&P, or, if unrated, deemed to be of equivalent quality in the sub-adviser's
judgment. While debt securities carrying the fourth highest quality rating (Baa
by Moody's or BBB by S&P) are considered investment grade and are viewed to have
adequate capacity for payment of principal and interest, investments in such
securities involve a higher degree of risk than that associated with investments
in debt securities in the higher rating categories and such debt securities lack
outstanding investment characteristics and in fact have speculative
characteristics as well. For example, changes in economic conditions or other
circumstances are more likely to lead to a weakened capacity to make principal
and interest payments than is the case with higher grade debt securities.

The types and characteristics of the U.S. Government obligations and
mortgage-backed securities to be purchased by the Series are set forth below in
the discussion of investment objectives and policies for the Salomon
Brothers/JNL U.S. Government & Quality Bond Series. In addition, the Series may
purchase privately issued mortgage securities which are not guaranteed by the
U.S. Government or its agencies or instrumentalities and may purchase stripped
mortgage securities, including interest-only and principal-only securities.
Additional information with respect to securities to be purchased by the Series
is set forth below under the sections entitled "Common Types of Securities and
Management Practices" and "Investment Risks."

The Series may invest in debt obligations issued or guaranteed by a foreign
sovereign government or one of its agencies or political subdivisions and debt
obligations issued or guaranteed by supranational organizations. Supranational
entities include international organizations designated or supported by
governmental entities to promote economic reconstruction or development and
international banking institutions and related government agencies. Examples
include the International Bank for Reconstruction and Development (the

21
<PAGE> 22

"World Bank"), the European Coal and Steel Community, the Asian Development Bank
and the Inter-American Development Bank. Such supranational issued instruments
may be denominated in multi-national currency units.

In pursuing the Series' investment objectives, the Series reserves the
right to invest predominantly in medium or lower-rated securities. Although the
Series has the ability to invest up to 100% of its assets in lower-rated
securities, the Series' sub-adviser does not anticipate investing in excess of
75% of the Series' assets in such securities. Investments of this type involve
significantly greater risks, including price volatility and risk of default in
the payment of interest and principal, than higher-quality securities. The
sub-adviser anticipates that under current market conditions, a significant
portion of the Series assets will be invested in such high risk, high yield
securities. By investing a portion of the Series' assets in securities rated
below investment grade as well as through investments in mortgage securities and
foreign debt securities, the sub-adviser expects to provide investors with a
higher yield than a high-quality domestic corporate bond fund. Certain of the
debt securities in which the Series may invest may be rated as low as C by
Moody's or D by S&P or may be considered comparable to securities having such
ratings. Medium and lower-rated securities are considered to be predominantly
speculative with respect to the issuer's capacity to pay interest and repay
principal.

In light of the risks associated with high yield corporate and sovereign
debt securities, the sub-adviser will take various factors into consideration in
evaluating the creditworthiness of an issuer. For corporate debt securities,
these will typically include the issuer's financial resources, its sensitivity
to economic conditions and trends, the operating history of the issuer, and the
experience and track record of the issuer's management. For sovereign debt
instruments, these will typically include the economic and political conditions
within the issuer's country, the issuer's overall and external debt levels and
debt service ratios, the issuer's access to capital markets and other sources of
funding, and the issuer's debt service payment history. The sub-adviser will
also review the ratings, if any, assigned to the security by any recognized
rating agencies, although the sub-adviser's judgment as to the quality of a debt
security may differ from that suggested by the rating published by a rating
service. The Series' ability to achieve its investment objective may be more
dependent on the sub-adviser's credit analysis than would be the case if it
invested in higher quality debt securities.

The high yield sovereign debt securities in which the Series may invest are
U.S. dollar-denominated debt securities, including Brady Bonds, and non-dollar
denominated debt securities that are issued or guaranteed by governments or
governmental entities of developing and emerging countries. The sub-adviser
expects that these countries will consist primarily of those which have issued
or have announced plans to issue Brady Bonds, but the portfolio is not limited
to investing in the debt of such countries. Brady Bonds are debt securities
issued under the framework of the Brady Plan, an initiative announced by former
U.S. Treasury Secretary Nicholas F. Brady in 1989 as a mechanism for debtor
nations to restructure their outstanding external indebtedness. (See "Investment
Risks -- High Yield/ High Risk Bonds"). The sub-adviser anticipates that the
Series' initial investments in sovereign debt will be concentrated in Latin
American countries, including Mexico and Central and South American and
Caribbean countries. The sub-adviser expects to take advantage of additional
opportunities for investment in the debt of North African countries, such as
Nigeria and Morocco, Eastern European countries, such as Poland and Hungary, and
Southeast Asian countries, such as the Philippines. Sovereign governments may
include national, provincial, state, municipal or other foreign governments with
taxing authority. Governmental entities may include the agencies and
instrumentalities of such governments, as well as state-owned enterprises. (For
a more detailed discussion of high yield sovereign debt securities, see
"Investment Risks -- High Yield/ High Risk Bonds").

The Series will be subject to special risks as a result of its ability to
invest up to 100% of its assets in foreign securities (including emerging market
securities). Such securities may be non-U.S. dollar denominated and there is no
limit on the percentage of the Series' assets that can be invested in non-dollar
denominated securities. The sub-adviser anticipates that, under current market
conditions, a significant portion of the Series' assets will be invested in
foreign securities. (See "Investment Risks"). The ability to spread its
investments among the fixed income markets in a

22
<PAGE> 23

number of different countries may, however, reduce the overall level or market
risk to the extent it may reduce the Series' exposure to a single market.

The Series may invest in zero coupon securities and pay-in-kind bonds. (See
"Common Types of Securities and Management Practices"). In addition, the Series
may invest in fixed and floating rate loans arranged through private
negotiations between a corporate borrower or a foreign sovereign entity and one
or more financial institutions. The Series may invest in such loans in the form
of participations in loans and assignments of all or a portion of loans from
third parties. The Series considers these investments to be investments in debt
securities for purposes of this Prospectus.

The Series may invest up to 20% of its assets in common stock, convertible
securities, warrants, preferred stock or other equity securities when consistent
with the Series' objectives. The Series will generally hold such equity
investments as a result of purchases of unit offerings of fixed income
securities which include such securities or in connection with an actual or
proposed conversion or exchange of fixed income securities, but may also
purchase equity securities not associated with fixed income securities when, in
the opinion of the sub-adviser, such purchase is appropriate.

The Series currently intends to invest substantially all of its assets in
fixed income securities. In order to maintain liquidity, however, the Series may
invest up to 20% of its assets in high-quality short-term money market
instruments. If at some future date, in the opinion of the sub-adviser, adverse
conditions prevail in the market for fixed income securities, the Series for
temporary defensive purposes may invest its assets without limit in high-quality
short-term money market instruments. The types and characteristics of the money
market securities to be purchased by the Series are set forth in the discussion
of investment objectives and policies of the PPM America/JNL Money Market
Series.

The Series may enter into repurchase and reverse repurchase agreements,
purchase securities on a firm commitment basis, including when-issued
securities, enter into mortgage "dollar rolls" and lend portfolio securities.
The Series will not make loans of portfolio securities with a value in excess of
25% of the Series' total assets. The Series may also enter into options, futures
and currency transactions, although with the exception of currency transactions,
it is not presently anticipated that any of these strategies will be utilized to
a significant degree by the Series. (See "Common Types of Securities and
Management Practices" and "Investment Risks"). The Series' ability to pursue
certain of these strategies may be limited by applicable regulations of the
Securities and Exchange Commission, the Commodity Futures Trading Commission and
the federal income tax requirements applicable to regulated investment
companies.

- --------------------------------------------------------------------------------
SALOMON BROTHERS/JNL U.S. GOVERNMENT & QUALITY BOND SERIES
- --------------------------------------------------------------------------------

The investment objective of the Salomon Brothers/JNL U.S. Government &
Quality Bond Series is to obtain a high level of current income. It is a
diversified Series that seeks to attain its objective by investing primarily in
debt obligations and mortgage-backed securities issued or guaranteed by the U.S.
Government, its agencies or instrumentalities including collateralized mortgage
obligations backed by such securities. The Series may also invest a portion of
its assets in investment grade bonds.

At least 65% of the total assets of the Series will be invested in:

(1) U.S. Treasury obligations;

(2) obligations issued or guaranteed by agencies or instrumentalities of
the U.S. Government which are backed by their own credit and may not be
backed by the full faith and credit of the U.S. Government;

(3) mortgage-backed securities guaranteed by the Government National
Mortgage Association that are supported by the full faith and credit of
the U.S. Government. Such securities entitle the holder to receive all
interest and

23
<PAGE> 24

principal payments due whether or not payments are actually made on the
underlying mortgages;

(4) mortgage-backed securities guaranteed by agencies or instrumentalities
of the U.S. Government which are supported by their own credit but not
the full faith and credit of the U.S. Government, such as the Federal
Home Loan Mortgage Corporation and the Federal National Mortgage
Association; and

(5) collateralized mortgage obligations issued by private issuers for which
the underlying mortgage-backed securities serving as collateral are
backed (i) by the credit alone of the U.S. Government agency or
instrumentality which issues or guarantees the mortgage-backed
securities, or (ii) by the full faith and credit of the U.S.
Government.

Any guarantee of the securities in which the Series invests runs only to
the principal and interest payments on the securities and not to the market
value of such securities or to the principal and interest payments on the
underlying mortgages. In addition, the guarantee only runs to the portfolio
securities held by the Series and not the purchase of shares of the Series.

The Series may invest in securities of any maturity or effective duration
and, accordingly, the composition and weighted average maturity of the Series'
portfolio will vary from time to time, based upon the sub-adviser's
determination of how best to achieve the Series' investment objective. With
respect to mortgage-backed securities in which the Series invests, average
maturity and duration are determined by using mathematical models that
incorporate prepayment assumptions and other factors that involve estimates of
future economic parameters. These estimates may vary from actual results,
particularly during periods of extreme market volatility. In addition, the
average maturity and duration of mortgage-backed derivative securities may not
accurately reflect the price volatility of such securities under certain market
conditions.

A significant portion of the Series' assets may from time to time be
invested in mortgage-backed securities. The mortgage-backed securities in which
the Series invests represent participating interests in pools of fixed rate and
adjustable rate residential mortgage loans issued or guaranteed by agencies or
instrumentalities of the U.S. Government. Mortgage-backed securities are issued
by lenders such as mortgage bankers, commercial banks, and savings and loan
associations. Mortgage-backed securities generally provide monthly payments
which are, in effect, a "pass-through" of the monthly interest and principal
payments (including any prepayments) made by the individual borrowers on the
pooled mortgage loans. Principal prepayments result from the sale of the
underlying property or the refinancing or foreclosure of underlying mortgages.

The yield of mortgage-backed securities is based upon the prepayment rates
experienced over the life of the security. Prepayments tend to increase during
periods of falling interest rates, while during periods of rising interest rates
prepayments will most likely decline. Reinvestment by the Series of scheduled
principal payments and unscheduled prepayments may occur at higher or lower
rates than the original investment, thus affecting the yield of the Series.
Monthly interest payments received by the Series have a compounding effect which
will increase the yield to shareholders as compared to debt obligations that pay
interest semi-annually. Because of the reinvestment of prepayments of principal
at current rates, mortgage-backed securities may be less effective than Treasury
bonds of similar maturity at maintaining yields during periods of declining
interest rates. Also, although the value of debt securities may increase as
interest rates decline, the value of these pass-through type of securities may
not increase as much due to the prepayment feature.

While the Series seeks a high level of current income, it cannot invest in
instruments such as lower grade corporate obligations which offer higher yields
but are subject to greater credit risks. The Series will not knowingly invest in
a high risk "mortgage security," generally defined as any mortgage security that
exhibits significantly greater price volatility than a benchmark security, the
Federal National Mortgage Association current coupon 30-year mortgage-backed
pass through security. Shares of the Series are neither insured nor guaranteed
by the U.S. Government, its agencies or instrumentalities. Neither the issuance
by nor the guarantee of a U.S. Government agency for a security constitutes
assurance that the security will not

24
<PAGE> 25

significantly fluctuate in value or that the Series will receive the originally
anticipated yield on the security.

The Series may also invest up to 35% of its assets in U.S.
dollar-denominated securities rated AAA, AA, A or BBB by S&P or Aaa, Aa, A or
Baa by Moody's, or if unrated, determined to be of comparable quality to
securities in those ratings categories by the sub-adviser. The Series may not
invest more than 10% of total assets in obligations of foreign issuers.
Investments in foreign securities will subject the Series to special
considerations related to political, economic and legal conditions outside of
the U.S. (See "Investment Risks"). These considerations include the possibility
of expropriation, nationalization, withholding taxes on income and difficulties
in enforcing judgments. Foreign securities may be less liquid and more volatile
than comparable U.S. securities.

The Series may enter into repurchase and reverse repurchase agreements,
purchase securities on a firm commitment basis, including when-issued
securities, and lend portfolio securities. The Series will not make loans of
portfolio securities with a value in excess of 25% of the value of its total
assets. The Series may also enter into mortgage "dollar rolls." (For a
description of these investment practices and the risks associated with them,
see "Common Types of Securities and Management Practices" and "Investment
Risks").

- --------------------------------------------------------------------------------
T. ROWE PRICE/JNL ESTABLISHED GROWTH SERIES
- --------------------------------------------------------------------------------

The investment objective of the T. Rowe Price/JNL Established Growth Series
is to seek long-term growth of capital and increasing dividend income through
investment primarily in common stocks of well-established growth companies. A
growth company is defined as one which: (1) has demonstrated historical growth
of earnings faster than the growth of inflation and the economy in general; and
(2) has indications of being able to continue this growth pattern in the future.
Total return will consist primarily of capital appreciation or depreciation and
secondarily of dividend income.

It is a diversified Series that will invest primarily in the common stock
of a diversified group of well-established growth companies. While current
dividend income is not a prerequisite in the selection of a growth company, the
companies in which the Series will invest normally have a record of paying
dividends and are generally expected to increase the amounts of such dividends
in future years as earnings increase. Although the Series will invest primarily
in U.S. common stocks, it may also purchase other types of securities, for
example, convertible securities, warrants, hybrid instruments, restricted
securities, futures and options, when considered consistent with the Series'
investment objective and program. The Series may invest up to 30% of its total
assets (excluding reserves) in foreign securities, including American Depositary
Receipts.

- --------------------------------------------------------------------------------
T. ROWE PRICE/JNL INTERNATIONAL EQUITY INVESTMENT SERIES
- --------------------------------------------------------------------------------

The investment objective of the T. Rowe Price/JNL International Equity
Investment Series is to seek long-term growth of capital through investments
primarily in common stocks of established, non-U.S. companies. Total return
consists of capital appreciation or depreciation, dividend income, and currency
gains or losses.

25
<PAGE> 26

Although there can be no assurance that these conditions will continue, the
Series' sub-adviser, within the framework of diversification, seeks to identify
and invest in companies participating in the faster growing foreign economies
and markets. The sub-adviser believes that investment in foreign securities
offers significant potential for long-term capital appreciation and an
opportunity to achieve investment diversification. The Series may also purchase
other types of securities, for example, common and preferred stocks, convertible
securities, fixed income securities, hybrid instruments, restricted securities,
foreign currency transactions, futures and options.

In analyzing companies for investment, the sub-adviser ordinarily looks for
one or more of the following characteristics: an above-average earnings growth
per share; high return on invested capital; healthy balance sheet; sound
financial and accounting policies and overall financial strength; strong
competitive advantages; effective research and product development and
marketing; efficient service; pricing flexibility; strength of management; and
general operating characteristics which will enable the companies to compete
successfully in their market place. While current dividend income is not a
prerequisite in the selection of portfolio companies, the companies in which the
Series invests, normally will have a record of paying dividends, and will
generally be expected to increase the amounts of such dividends in future years
as earnings increase.

It is a diversified Series that intends to diversify investments broadly
among countries and to normally have at least three different countries
represented in the Series. The Series may invest in countries of the Far East
and Europe, as well as South Africa, Australia, Canada and other areas
(including developing countries). Under unusual circumstances, however, the
Series may invest substantially all of its assets in one or two countries.

- --------------------------------------------------------------------------------
T. ROWE PRICE/JNL MID-CAP GROWTH SERIES
- --------------------------------------------------------------------------------

The investment objective of the T. Rowe Price/JNL Mid-Cap Growth Series is
to provide long-term growth of capital by investing primarily in the common
stock of companies with medium-sized market capitalizations ("mid-cap") and the
potential for above-average growth.

It is a diversified Series that will invest at least 65% of its total
assets in a diversified portfolio of mid-cap common stocks with above-average
growth potential. A mid-cap company is defined as one whose market
capitalization falls within the capitalization range of companies included in
the S&P MidCap 400 Index. Mid-cap growth companies are often still in the early,
more dynamic phase of a company's life cycle, but have enough corporate history
that they are no longer considered new or emerging. By focusing their
activities, mid-cap companies may be more responsive and better able to adapt to
the changing needs of their markets. They are usually mature enough to have
established organizational structures and the depth of management needed to
expand their operations. In addition, these companies generally have sufficient
financial resources and access to capital to finance their growth.

While investing in mid-cap growth companies generally entails greater risk
and volatility than investing in large, well-established companies, mid-cap
companies are expected to offer the potential for more rapid growth. They may
also offer greater potential for capital appreciation because of their higher
growth rates. In addition, the stocks of such companies are less actively
followed by securities analysts and may, therefore, be undervalued by investors.

The sub-adviser will rely on its proprietary research to identify mid-cap
companies with attractive growth prospects. The Series will seek to invest
primarily in companies which: 1) offer proven products or services, 2) have a
historical record of earnings growth that is above average, 3) demonstrate the
potential to sustain earnings growth, 4) operate in industries experiencing
increasing demand, and/or 5) are believed to be reasonably valued in the
marketplace. There is, of course, no guarantee the Series will be able to
identify

26
<PAGE> 27

such companies or that its investment in them will be successful.

Although the Series will invest primarily in U.S. common stocks, it may
also purchase other types of securities, for example, convertible securities,
restricted securities, hybrid instruments, warrants, futures and options, when
considered consistent with the Series' investment objective and program. The
Series may invest up to 25% of its assets (excluding reserves) in foreign
securities, including American Depositary Receipts.

- --------------------------------------------------------------------------------
COMMON TYPES OF SECURITIES AND MANAGEMENT PRACTICES
- --------------------------------------------------------------------------------

SECURITIES AND MANAGEMENT PRACTICES

This section describes some of the types of securities a Series may hold in
its portfolio and the various kinds of investment practices that may be used in
day-to-day portfolio management. A Series may invest in the following securities
or engage in the following practices to the extent that such securities and
practices are consistent with the Series' investment objective(s) and policies
described herein. Each Series' investment program is subject to further
restrictions described in the Statement of Additional Information.

BORROWING AND LENDING. A Series may borrow money from banks for temporary
or emergency purposes in amounts up to 25% of its total assets. To secure
borrowings a Series may mortgage or pledge securities in amounts up to 15% of
its net assets. As a fundamental policy, a Series will not lend securities or
other assets if, as a result, more than 25% of its total assets would be lent to
other parties.

CASH POSITION. A Series may hold a certain portion of its assets in
repurchase agreements and money market securities rated in one of the two
highest rating categories by a nationally recognized statistical rating
organization, maturing in one year or less. For temporary, defensive purposes, a
Series may invest without limitation in such securities. This reserve position
provides flexibility in meeting redemptions, expenses, and the timing of new
investments, and serves as a short-term defense during periods of unusual market
volatility.

COMMON AND PREFERRED STOCKS. Stocks represent shares of ownership in a
company. Generally, preferred stock has a specified dividend and ranks after
bonds and before common stocks in its claim on income for dividend payments and
on assets should the company be liquidated. After other claims are satisfied,
common stockholders participate in company profits on a pro rata basis; profits
may be paid out in dividends or reinvested in the company to help it grow.
Increases and decreases in earnings are usually reflected in a company's stock
price, so common stocks generally have the greatest appreciation and
depreciation potential of all corporate securities. While most preferred stocks
pay a dividend, a Series may purchase preferred stock where the issuer has
omitted, or is in danger of omitting, payment of its dividend. Such investments
would be made primarily for their capital appreciation potential. Although
common and preferred stocks have a history of long-term growth in value, their
prices tend to fluctuate in the short term, particularly those of smaller
companies.

CONVERTIBLE SECURITIES AND WARRANTS. A Series may invest in debt or
preferred equity securities convertible into or exchangeable for equity
securities. Traditionally, convertible securities have paid dividends or
interest at rates higher than common stocks but lower than non-convertible
securities. They generally participate in the appreciation or depreciation of
the underlying stock into which they are convertible, but to a lesser degree. In
recent years, convertibles have been developed which combine higher or lower
current income with options and other features. Warrants are options to buy a
stated number of shares of common stock at a specified price any time during the
life of the warrants (generally, two or more years).

FIXED INCOME SECURITIES. A Series may invest in fixed income securities of
companies which meet the

27
<PAGE> 28

investment criteria for the Series. The price of fixed income securities
fluctuates with changes in interest rates, generally rising when interest rates
fall and falling when interest rates rise. Prices of longer-term securities
generally increase or decrease more sharply than those of shorter-term
securities in response to interest rate changes.

FOREIGN CURRENCY TRANSACTIONS. A Series will normally conduct its foreign
currency exchange transactions either on a spot (i.e., cash), basis at the spot
rate prevailing in the foreign currency exchange market, or through entering
into forward contracts to purchase or sell foreign currencies. A Series will
generally not enter into a forward contract with a term of greater than one
year.

There are certain markets where it is not possible to engage in effective
foreign currency hedging. This may be true, for example, for the currencies of
various countries where the foreign exchange markets are not sufficiently
developed to permit hedging activity to take place.

FOREIGN SECURITIES. A Series may invest in foreign securities. These
include non-dollar denominated securities traded principally outside the U.S.
and dollar denominated securities traded in the U.S. (such as American
Depositary Receipts). Such investments increase a Series' diversification and
may enhance return, but they also involve some special risks such as exposure to
potentially adverse local political and economic developments; nationalization
and exchange controls; potentially lower liquidity and higher volatility;
possible problems arising from accounting, disclosure, settlement, and
regulatory practices that differ from U.S. standards; and the chance that
fluctuations in foreign exchange rates will decrease the investment's value
(favorable changes can increase its value).

FUTURES AND OPTIONS. Futures are often used to manage risk, because they
enable the investor to buy or sell an asset in the future at an agreed upon
price. Options give the investor the right, but not the obligation, to buy or
sell an asset at a predetermined price in the future. A Series may buy and sell
futures contracts (and options on such contracts) to manage its exposure to
changes in securities prices and foreign currencies and as an efficient means of
adjusting overall exposure to certain markets. Subject to certain limits
described in the Statement of Additional Information, a Series may purchase or
sell call and put options on securities, financial indices, and foreign
currencies, and may invest in futures contracts on foreign currencies and
financial indices, including interest rates or an index of U.S. Government
securities, foreign government securities or equity or fixed income securities.

Futures contracts and options may not always be successful hedges; their
prices can be highly volatile; using them could lower a Series' total return;
and the potential loss from the use of futures can exceed the Series' initial
investment in such contracts. These instruments may also be used for non-hedging
purposes such as increasing a Series' income.

The Series' use of commodity futures and commodity options trading should
not be viewed as providing a vehicle for shareholder participation in a
commodity pool. Rather, in accordance with regulations adopted by the CFTC, a
Series will employ such techniques only for (1) hedging purposes, or (2)
otherwise, to the extent that aggregate initial margin and required premiums do
not exceed 5 percent of the Series' net assets.

ILLIQUID SECURITIES. Each Series may invest up to 15% of its net assets
(10% in the case of the JNL/Alger Growth Series and the PPM America/JNL Money
Market Series) in securities that are considered illiquid. Illiquid investments
include repurchase agreements not terminable within seven days, securities for
which market quotations are not readily available and certain restricted
securities. Illiquid investments may be difficult to sell promptly at an
acceptable price. Difficulty in selling securities may result in a loss or may
be costly to a Series. Certain restricted securities may be determined to be
liquid in accordance with guidelines adopted by the Trust's Board of Trustees.

HIGH YIELD BONDS. A Series may invest its assets in fixed income securities
offering high current income that are in the lower rating categories of
recognized rating agencies or are non-rated. These lower-rated fixed income
securities are considered on balance, as predominantly speculative with respect
to capacity to pay interest and repay principal in accordance with the terms of
the obligation and generally will involve more

28
<PAGE> 29

credit risk than securities in the higher rating categories.

DEBT HOLDINGS BY RATINGS. During the period ended December 31, 1996, the
percentage of the assets of the following Series invested in debt securities in
each of the rating categories of S&P and the debt securities not rated by an
established rating service, determined on a dollar weighted average, were:

<TABLE>
<CAPTION>
PERCENTAGE OF NET ASSETS
----------------------------------
PPM AMERICA/ SALOMON BROTHERS/
JNL HIGH YIELD JNL GLOBAL
S&P RATING BOND SERIES BOND SERIES
---------- -------------- -----------------
<S> <C> <C>
AAA.................. 0% 28.05%
AA................... 0% 1.78%
A.................... 0% 0.45%
BBB.................. 2.05% 4.09%
BB................... 28.43% 6.83%
B.................... 66.23% 29.51%
CCC.................. 0.81% 2.84%
CC................... 0% 0%
C.................... 0% 0%
D.................... 0% 0%
Not Rated............ 2.48% 26.45%
</TABLE>

HYBRID INSTRUMENTS. These instruments can combine the characteristics of
securities, futures and options. For example, the principal amount, redemption
or conversion terms of a security could be related to the market price of some
commodity, currency or securities index. Such securities may bear interest or
pay dividends at below market (or even relatively nominal) rates. Under certain
conditions, the redemption value of such an investment could be zero. Hybrids
can have volatile prices and limited liquidity and their use by a Series may not
be successful.

MORTGAGE- AND ASSET-BACKED SECURITIES. A Series may invest in mortgage- and
asset-backed securities. These securities are subject to prepayment risk, that
is, the possibility that prepayments on the underlying mortgages or other loans
will cause the principal and interest on the mortgage- and asset-backed
securities to be paid prior to their stated maturities. A sub-adviser will
consider estimated prepayment rates in calculating the average weighted
maturities of the Series. Unscheduled prepayments are more likely to accelerate
during periods of declining long-term interest rates. In the event of a
prepayment during a period of declining interest rates, a Series may be required
to invest the unanticipated proceeds at a lower interest rate. Prepayments
during such periods will also limit a Series' ability to participate in as large
a market gain as may be experienced with a comparable security not subject to
prepayment.

A Series may purchase stripped mortgage-backed securities, which may be
considered derivative mortgage-backed securities, which may be issued by
agencies or instrumentalities of the U.S. Government or by private entities.
Stripped mortgage-backed securities have greater volatility than other types of
mortgage-backed securities. Stripped mortgage-backed securities are structured
with two or more classes that receive different proportions of the interest and
principal distributions on a pool of mortgage assets. In the most extreme case,
one class will receive all of the interest, while the other class will receive
all of the principal. The yield to maturity of such mortgage backed securities
that are purchased at a substantial discount or premium are extremely sensitive
to changes in interest rates as well as to the rate of principal payments
(including prepayments) on the related underlying mortgage assets.

MORTGAGE DOLLAR ROLLS. A Series may enter into mortgage "dollar rolls" in
which a Series sells mortgage-backed securities for delivery in the current
month and simultaneously contracts to repurchase substantially similar (same
type, coupon and maturity) securities on a specified future date. During the
roll period, a Series foregoes principal and interest paid on the
mortgage-backed securities. A Series is compensated by the interest earned on
the cash proceeds of the initial sale and from negotiated fees paid by brokers
offered as an inducement to the Series to "roll over" its purchase commitments.
A Series may only enter into covered rolls. A "covered roll" is a specific type
of dollar roll for which there is an offsetting cash position which matures on
or before the forward settlement date of the dollar roll transaction. At the
time a Series enters into a mortgage "dollar roll", it will establish a
segregated account with its custodian bank in which it will maintain cash, U.S.
Government securities or other liquid assets equal in value to its obligations
in respect of dollar rolls, and accordingly, such dollar rolls will not

29
<PAGE> 30

be considered borrowings. Mortgage dollar rolls involve the risk that the market
value of the securities the Series is obligated to repurchase under the
agreement may decline below the repurchase price. In the event the buyer of
securities under a mortgage dollar roll files for bankruptcy or becomes
insolvent, the Series' use of proceeds of the dollar roll may be restricted
pending a determination by the other party, or its trustee or receiver, whether
to enforce the Series' obligation to repurchase the securities.

COLLATERALIZED MORTGAGE OBLIGATIONS (CMOS). A Series may invest in CMOs.
CMOs are bonds that are collateralized by whole loan mortgages or mortgage
pass-through securities. In recent years, new types of CMO structures have
evolved. These include floating rate CMOs, planned amortization classes, accrual
bonds, and CMO residuals. Under certain of these new structures, given classes
of CMOs have priority over others with respect to the receipt of prepayments on
the mortgages. Therefore, depending on the type of CMOs in which the Series
invests, the investment may be subject to a greater or lesser risk of prepayment
than other types of mortgage-related securities.

The primary risk of any mortgage security is the uncertainty of the timing
of cash flows. For CMOs, the primary risk results from the rate of prepayments
on the underlying mortgages serving as collateral. An increase or decrease in
prepayment rates (resulting primarily from a decrease or increase in mortgage
interest rates) will affect the yield, average life, and price of CMOs. The
prices of certain CMOs, depending on their structure and the rate of
prepayments, can be volatile. Some CMOs may also not be as liquid as other
securities.

REAL ESTATE INVESTMENT TRUSTS ("REITS"). The REITs in which a Series may
invest include equity REITs, which own real estate properties, and mortgage
REITs, which make construction, development and long-term mortgage loans. The
value of an equity REIT may be affected by changes in the value of the
underlying property, while a mortgage REIT may be affected by the quality of the
credit extended. The performance of both types of REITs depends upon conditions
in the real estate industry, management skills and the amount of cash flow. The
risks associated with REITs include defaults by borrowers, self-liquidation,
failure to qualify as a "pass-through" entity under the Federal tax law, failure
to qualify as an exempt entity under the 1940 Act, and the fact that REITs are
not diversified.

PORTFOLIO TURNOVER. To a limited extent, a Series may engage in short-term
transactions if such transactions further its investment objective. A Series may
sell one security and simultaneously purchase another of comparable quality or
simultaneously purchase and sell the same security to take advantage of
short-term differentials in bond yields or otherwise purchase individual
securities in anticipation of relatively short-term price gains. The rate of
portfolio turnover will not be a determining factor in the purchase and sale of
such securities. However, certain tax rules may restrict the Series' ability to
sell securities in some circumstances when the security has been held for less
than three months. Increased portfolio turnover necessarily results in
correspondingly higher costs including brokerage commissions, dealer mark-ups
and other transaction costs on the sale of securities and reinvestment in other
securities, and may result in the acceleration of taxable gains.

REPURCHASE AGREEMENTS AND REVERSE REPURCHASE AGREEMENTS. A Series may
invest in repurchase or reverse repurchase agreements. A repurchase agreement
involves the purchase of a security by a Series and a simultaneous agreement
(generally by a bank or dealer) to repurchase that security from the Series at a
specified price and date or upon demand. This technique offers a method of
earning income on idle cash. The repurchase agreement is effectively secured by
the value of the underlying security. A risk associated with repurchase
agreements is the failure of the seller to repurchase the securities as agreed,
which may cause a Series to suffer a loss if the market value of such securities
declines before they can be liquidated on the open market. In the event of
bankruptcy or insolvency of the seller, a Series may encounter delays and incur
costs in liquidating the underlying security.

30
<PAGE> 31

requests or for other temporary or emergency purposes without the necessity of
selling portfolio securities or to earn additional income on portfolio
securities, such as Treasury bills and notes.

SHORT SALES. A Series may sell securities short. A short sale is the sale
of a security the Series does not own. It is "against the box" if at all times
when the short position is open the Series owns an equal amount of the
securities or securities convertible into, or exchangeable without further
consideration for, securities of the same issue as the securities sold short. To
the extent that a Series engages in short sales that are not "against the box,"
it must maintain asset coverage in the form of assets determined to be liquid by
the sub-adviser in accordance with procedures established by the Board of
Trustees, in a segregated account, or otherwise cover its position in a
permissible manner.

U.S. GOVERNMENT SECURITIES AND CUSTODIAL RECEIPTS. Obligations issued or
guaranteed as to principal and interest by the U.S. Government, its agencies or
instrumentalities include Treasury bills, notes and bonds and Government
National Mortgage Association ("GNMA") certificates which are supported by the
full faith and credit of the United States; others, such as those of the Federal
Home Loan Banks, are supported by the right of the issuer to borrow from the
Treasury; others, such as those of the Federal National Mortgage Association
("FNMA"), are supported by the discretionary authority of the U.S. Government to
purchase the agency's obligations; and still others, such as those of the
Student Loan Marketing Association, are supported only by the credit of the
instrumentality. No assurance can be given that the U.S. Government will provide
financial support to U.S. Government agencies or instrumentalities in the
future, other than as set forth above, since it is not obligated to do so by
law.

WHEN-ISSUED SECURITIES. A Series may purchase securities on a when-issued,
delayed delivery or forward commitment basis. Actual payment for and delivery of
such securities does not take place until some time in the future -- i.e.,
beyond normal settlement. The Series does not earn interest on such securities
until settlement and bears the risk of market value fluctuations during the
period between the purchase and settlement dates. The Series segregate and
maintain at all times cash, cash equivalents, or other liquid assets in an
amount at least equal to the amount of outstanding commitments for when-issued
securities.

ZERO COUPON AND PAY-IN-KIND BONDS. A Series may invest up to 10% of its
assets in zero coupon bonds or strips. Zero coupon bonds do not make regular
interest payments; rather, they are sold at a discount from face value.
Principal and accreted discount (representing interest accrued but not paid) are
paid at maturity. Strips are debt securities that are stripped of their interest
after the securities are issued, but otherwise are comparable to zero coupon
bonds. The market value of strips and zero coupon bonds generally fluctuates in
response to changes in interest rates to a greater degree than interest-paying
securities of comparable term and quality. A Series may also purchase pay-
in-kind bonds. Pay-in-kind bonds pay all or a portion of their interest in the
form of debt or equity securities.

Zero coupon and pay-in-kind bonds tend to be subject to greater price
fluctuations in response to changes in interest rates than are ordinary
interest-paying debt securities with similar maturities. The value of zero
coupon securities appreciates more during periods of declining interest rates
and depreciates more during periods of rising interest rates than ordinary
interest-paying debt securities with similar maturities. Zero coupon securities
and pay-in-kind bonds may be issued by a wide variety of corporate and
governmental issuers.

Current federal income tax law requires the holder of a zero coupon
security, certain pay-in-kind bonds and certain other securities acquired at a
discount (such as Brady Bonds) to accrue income with respect to these securities
prior to the receipt of cash payments. Accordingly, to avoid liability for
federal income and excise taxes, a Series may be required to distribute income
accrued with respect to these securities and may have to dispose of portfolio
securities under disadvantageous circumstances in order to generate cash to
satisfy these distribution requirements.

PARTICIPATIONS AND ASSIGNMENTS

A Series may invest in fixed and floating rate loans ("Loans") arranged
through private negotiations between a corporate borrower or a foreign sovereign
entity

31
<PAGE> 32

and one or more financial institutions ("Lenders"). A Series may invest in such
Loans in the form of participations in Loans ("Participations") and assignments
of all or a portion of Loans from third parties ("Assignments"). Participations
typically will result in a Series having a contractual relationship only with
the Lender, not with the borrower. A Series will have the right to receive
payments of principal, interest and any fees to which it is entitled only from
the Lender selling the Participation and only upon receipt by the Lender of the
payments from the borrower. In connection with purchasing Participations, a
Series generally will have no right to enforce compliance by the borrower with
the terms of the loan agreement relating to the Loan, nor any rights of set-off
against the borrower, and a Series may not benefit directly from any collateral
supporting the Loan in which it has purchased the Participation. As a result, a
Series will assume the credit risk of both the borrower and the Lender that is
selling the Participation. In the event of the insolvency of the Lender selling
a Participation, a Series may be treated as a general creditor of the Lender and
may not benefit from any set-off between the Lender and the borrower. A Series
will acquire Participations only if the Lender interpositioned between a Series
and the borrower is determined by the sub-adviser to be creditworthy. When a
Series purchases Assignments from Lenders, a Series will acquire direct rights
against the borrower on the Loan, except that under certain circumstances such
rights may be more limited than those held by the assigning Lender.

A Series may have difficulty disposing of Assignments and Participations.
Because the market for such instruments is not highly liquid, a Series
anticipates that such instruments could be sold only to a limited number of
institutional investors. The lack of a highly liquid secondary market may have
an adverse impact on the value of such instruments and will have an adverse
impact on a Series' ability to dispose of particular Assignments or
Participations in response to a specific economic event, such as deterioration
in the creditworthiness of the borrower. A Series currently treats investments
in Participations and Assignments as illiquid for purposes of its limitation on
investment in illiquid securities. However, the Trustees may in the future adopt
policies and procedures for the purpose of determining whether Assignments and
Loan Participations are liquid or illiquid. Pursuant to such policies and
procedures, the Trustees would delegate to the sub-adviser the determination as
to whether a particular Loan Participation or Assignment is liquid or illiquid,
requiring that consideration be given to, among other things, the frequency of
quotes, the number of dealers willing to sell and the number of potential
purchasers, the nature of the Loan Participation or Assignment and the time
needed to dispose of it and the contractual provisions of the relevant
documentation. The Trustees would periodically review purchases and sales of
Assignments and Loan Participations. To the extent that liquid Assignments and
Loan Participations that a Series held became illiquid, due to the lack of
sufficient buyers or market or other conditions, the percentage of the Series'
assets invested in illiquid assets would increase.

INVESTMENT RISKS

FOREIGN SECURITIES

Investments in foreign securities, including those of foreign governments,
involve risks that are different in some respects from investments in securities
of U.S. issuers, such as the risk of fluctuations in the value of the currencies
in which they are denominated, a heightened risk of adverse political and
economic developments and, with respect to certain countries, the possibility of
expropriation, nationalization or confiscatory taxation or limitations on the
removal of funds or other assets of a Series. Securities of some foreign issuers
in many cases are less liquid and more volatile than securities of comparable
domestic issuers. There also may be less publicly available information about
foreign issuers than domestic issuers, and foreign issuers generally are not
subject to the uniform accounting, auditing and financial reporting standards,
practices and requirements applicable to domestic issuers. Certain markets may
require payment for securities before delivery. A Series may have limited legal
recourse against the issuer in the event of a default on a debt instrument.
Delays may be encountered in settling securities transactions in certain foreign
markets and a Series will incur costs in converting foreign currencies into U.S.
dollars. Bank custody charges are generally higher for foreign securities. The
JNL Global Equities,

32
<PAGE> 33

Salomon Brothers/JNL Global Bond, and T. Rowe Price/JNL International Equity
Investment Series are particularly susceptible to such risks. American
Depositary Receipts do not involve the same direct currency and liquidity risks
as foreign securities.

At times, securities held by a Series may be listed on foreign exchanges or
traded in foreign markets which are open on days (such as Saturday) when a
Series does not compute its price or accept orders for the purchase, redemption
or exchange of its shares. As a result, the net asset value of a Series may be
significantly affected by trading on days when shareholders cannot make
transactions.

The share price of a Series that invests in foreign securities will reflect
the movements of both the prices of the portfolio securities and the currencies
in which such securities are denominated. A Series' foreign investments may
cause changes in a Series' share price that have a low correlation with movement
in the U.S. markets. Because most of the foreign securities in which a Series
invests will be denominated in foreign currencies, or otherwise will have values
that depend on the performance of foreign currencies relative to the U.S.
dollar, the relative strength of the U.S. dollar may be an important factor in
the performance of a Series, depending on the extent of the Series' foreign
investments.

A Series may employ certain strategies in order to manage exchange rate
risks. For example, a Series may hedge some or all of its investments
denominated in or exposed to a foreign currency against a decline in the value
of that currency. A Series may enter into contracts to sell that foreign
currency for U. S. dollars (not exceeding the value of a Series' assets
denominated in or exposed to that currency) or by participating in options or
futures contracts with respect to such currency ("position hedge"). A Series
could also hedge that position by selling a second currency, which is expected
to perform similarly to the currency in which portfolio investments are
denominated, for U.S. dollars ("proxy hedge"). A Series may also enter into a
forward contract to sell the currency in which the security is denominated for a
second currency that is expected to perform better relative to the U.S. dollar
if the sub-adviser believes there is a reasonable degree of correlation between
movements in the two currencies ("cross hedge"). A Series may also enter into a
forward contract to sell a currency in which portfolio securities are
denominated in exchange for a second currency in order to manage its currency
exposure to selected countries. In addition, when a Series anticipates
purchasing securities denominated in or exposed to a particular currency, the
Series may enter into a forward contract to purchase or sell such currency in
exchange for the dollar or another currency ("anticipatory hedge").

These strategies minimize the effect of currency appreciation as well as
depreciation, but do not protect against a decline in the underlying value of
the hedged security. In addition, such strategies may reduce or eliminate the
opportunity to profit from increases in the value of the original currency and
may adversely impact a Series' performance if the sub-adviser's projection of
future exchange rates is inaccurate.

EMERGING MARKETS

The considerations noted above under "Foreign Securities" may be
intensified in the case of investment in developing countries. Investments in
securities of issuers in emerging markets countries may involve a high degree of
risk and many may be considered speculative. These investments carry all of the
risks of investing in securities of foreign issuers to a heightened degree.
These heightened risks include (i) greater risks of expropriation, confiscatory
taxation, nationalization, and less social, political and economic stability;
(ii) limitations on daily price changes and the small current size of the
markets for securities of emerging markets issuers and the currently low or
nonexistent volume of trading, resulting in lack of liquidity and in price
volatility; (iii) certain national policies which may restrict a Series'
investment opportunities including limitations on aggregate holdings by foreign
investors and restrictions on investing in issuers or industries deemed
sensitive to relevant national interests; and (iv) the absence of developed
legal structures governing private or foreign investment and private property.

FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS

The use of futures, options, forward contracts, and swaps ("derivative
instruments") exposes a Series to

33
<PAGE> 34

additional investment risks and transaction costs. If a sub-adviser seeks to
protect a Series against potential adverse movements in the securities, foreign
currency or interest rate markets using these instruments, and such markets do
not move in a direction adverse to the Series, that Series could be left in a
less favorable position than if such strategies had not been used. Risks
inherent in the use of futures, options, forward contracts and swaps include (1)
the risk that interest rates, securities prices and currency markets will not
move in the directions anticipated; (2) imperfect correlation between the price
of derivative instruments and movements in the prices of the securities,
interest rates or currencies being hedged; (3) the fact that skills needed to
use these strategies are different from those needed to select portfolio
securities; (4) the possible absence of a liquid secondary market for any
particular instrument at any time; and (5) the possible need to defer closing
out certain hedged positions to avoid adverse tax consequences.

HIGH YIELD/HIGH RISK BONDS

Lower rated bonds involve a higher degree of credit risk, which is the risk
that the issuer will not make interest or principal payments when due. In the
event of an unanticipated default, a Series would experience a reduction in its
income, a decline in the market value of the securities so affected and a
decline in the value of its shares. More careful analysis of the financial
condition of issuers of lower rated securities is therefore necessary. During an
economic downturn or substantial period of rising interest rates, highly
leveraged issuers may experience financial stress which could adversely affect
their ability to service principal and interest payment obligations, to meet
projected business goals and to obtain additional financing.

The market prices of lower rated securities are generally less sensitive to
interest rate changes than higher rated investments, but more sensitive to
adverse economic or political changes, or individual developments specific to
the issuer. Periods of economic or political uncertainty and change can be
expected to result in volatility of prices of these securities. Since the last
major economic recession, there has been a substantial increase in the use of
high-yield debt securities to fund highly leveraged corporate acquisitions and
restructurings, so past experience with high-yield securities in a prolonged
economic downturn may not provide an accurate indication of future performance
during such periods. Lower rated securities also may have less liquid markets
than higher rated securities, and their liquidity as well as their value may be
more severely affected by adverse economic conditions. Many high-yield bonds do
not trade frequently. When they do trade, their price may be substantially
higher or lower than had been expected. A lack of liquidity also means that
judgment may play a bigger role in valuing the securities. Adverse publicity and
investor perceptions as well as new or proposed laws may also have a greater
negative impact on the market for lower rated bonds.

A Series may also invest in unrated debt securities of foreign and domestic
issuers. Unrated debt, while not necessarily of lower quality than rated
securities, may not have as broad a market. Sovereign debt of foreign
governments is generally rated by country, because these ratings do not take
into account individual factors relevant to each issue and may not be updated
regularly. Because of the size and perceived demand of the issue, among other
factors, certain municipalities may not incur the costs of obtaining a rating.
The sub-adviser will analyze the credit- worthiness of the issuer, as well as
any financial institution or other party responsible for payments on the
security, in determining whether to purchase unrated municipal bonds. (See
Appendix A for a description of bond rating categories).

HIGH YIELD FOREIGN SOVEREIGN DEBT SECURITIES

Investing in fixed and floating rate high yield foreign sovereign debt
securities will expose the Series investing in such securities to the direct or
indirect consequences of political, social or economic changes in the countries
that issue the securities. (See "Foreign Securities"). The ability and
willingness of sovereign obligors in developing and emerging market countries or
the governmental authorities that control repayment of their external debt to
pay principal and interest on such debt when due may depend on general economic
and political conditions within the relevant country. Countries such as those in
which a Series may invest have historically experienced, and may continue to
experience, high rates of inflation, high interest rates,

34
<PAGE> 35

exchange rate trade difficulties and extreme poverty and unemployment. Many of
these countries are also characterized by political uncertainty or instability.
Additional factors which may influence the ability or willingness to service
debt include, but are not limited to, a country's cash flow situation, the
availability of sufficient foreign exchange on the date a payment is due, the
relative size of its debt service burden to the economy as a whole, and its
government's policy towards the International Monetary Fund, the World Bank and
other international agencies.

HYBRID INSTRUMENTS

The risks of investing in hybrid instruments reflect a combination of the
risks of investing in securities, options, futures and currencies, including
volatility and lack of liquidity. Reference is made to the discussion of
futures, options, and forward contracts herein for a discussion of these risks.
Further, the prices of the hybrid instrument and the related commodity or
currency may not move in the same direction or at the same time. Hybrid
instruments may bear interest or pay preferred dividends at below market (or
even relatively nominal) rates. Alternatively, hybrid instruments may bear
interest at above market rates but bear an increased risk of principal loss. In
addition, because the purchase and sale of hybrid instruments could take place
in an over-the-counter or in a private transaction between the Series and the
seller of the hybrid instrument, the creditworthiness of the counter-party to
the transaction would be a risk factor which the Series would have to consider.
Hybrid instruments also may not be subject to regulation of the Commodity
Futures Trading Commission, which generally regulates the trading of commodity
futures by U.S. persons, the Securities and Exchange Commission, which regulates
the offer and sale of securities by and to U.S. persons, or any other
governmental regulatory authority.

MUNICIPAL OBLIGATIONS

In addition to the usual risks associated with income investing, the value
of municipal obligations can be affected by changes in the actual or perceived
credit quality of municipal obligations held by a Series. The credit quality of
a municipal obligation can be affected by, among other factors, the financial
condition of the issuer or guarantor, the issuer's future borrowing plans and
sources of revenue, the economic feasibility of the revenue bond project or
general borrowing purpose, political or economic developments in the region
where the security is issued, and the liquidity of the security. Because
municipal obligations are generally traded over-the-counter, the liquidity of a
particular issue often depends on the willingness of dealers to make a market in
the security. The liquidity of some municipal issues may be enhanced by demand
features, which enable a Series to demand payment on short notice from the
issuer or a financial intermediary.

WHEN-ISSUED SECURITIES

The price of such securities, which may be expressed in yield terms, is
fixed at the time the commitment to purchase is made, but delivery and payment
take place at a later date. Normally, the settlement date occurs within 90 days
of the purchase for when-issued securities, but may be substantially longer for
forward commitments. During the period between purchase and settlement, no
payment is made by the Series to the issuer and no interest accrues to the
Series. The purchase of these securities will result in a loss if their value
declines prior to the settlement date. This could occur, for example, if
interest rates increase prior to settlement. The longer the period between
purchase and settlement, the greater the risks. At the time the Series makes the
commitment to purchase these securities, it will record the transaction and
reflect the value of the security in determining its net asset value. The Series
will segregate for these securities by maintaining cash and/or liquid assets
with its custodian bank equal in value to commitments for them during the time
between the purchase and the settlement. Therefore, the longer this period, the
longer the period during which alternative investment options are not available
to the Series (to the extent of the securities used for cover). Such securities
either will mature or, if necessary, be sold on or before the settlement date.

35
<PAGE> 36

- --------------------------------------------------------------------------------
MANAGEMENT OF THE TRUST
- --------------------------------------------------------------------------------

INVESTMENT ADVISER

Under Massachusetts law and the Trust's Declaration of Trust and By-Laws,
the management of the business and affairs of the Trust is the responsibility of
the Trustees.

JNFSI, 5901 Executive Drive, Lansing, Michigan 48911, is the investment
adviser of each Series and provides each Series with professional investment
supervision and management. JNFSI is a wholly owned subsidiary of Jackson
National Life Insurance Company, which is in turn wholly owned by Prudential
Corporation plc, the largest life insurance company in the United Kingdom. JNFSI
has been providing investment advisory services to management investment
companies since 1992 and as of December 31, 1996, had approximately $1 billion
under management.

JNFSI provides preparation of financial statements, tax services, and
regulatory reports to the Trust. JNFSI also selects, contracts with and
compensates sub-advisers to manage the investment and reinvestment of the assets
of the Series of the Trust. JNFSI monitors the compliance of such sub-advisers
with the investment objectives and related policies of each Series and reviews
the performance of such sub-advisers and reports periodically on such
performance to the Trustees of the Trust.

As compensation for its services, JNFSI receives a fee from the Trust
computed separately for each Series. The fee for each Series is stated as an
annual percentage of the current value of the net assets of the Series. The
fees, which are accrued daily and payable monthly, are calculated on the basis
of the average net assets of each Series. Once the average net assets of a
Series exceed specified amounts, the fee is reduced with respect to such excess.
The following is a schedule of the fees each Series currently is obligated to
pay JNFSI.

36
<PAGE> 37

<TABLE>
<CAPTION>
(M -- MILLION) $ 0 TO $50 M TO $100 M TO $150 M TO $200 M TO $250 M TO $300 M TO $350 M TO OVER
$50 M $100 M $150 M $200 M $250 M $300 M $350 M $500 M $500 M
% % % % % % % % %
SERIES ------ -------- --------- --------- --------- --------- --------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
JNL Aggressive Growth..... .95 .95 .95 .90 .90 .90 .85 .85 .85
JNL Capital Growth........ .95 .95 .95 .90 .90 .90 .85 .85 .85
JNL Global Equities....... 1.00 1.00 1.00 .95 .95 .95 .90 .90 .90
JNL/Alger Growth.......... .975 .975 .975 .975 .975 .975 .95 .95 .90
JNL/Putnam Growth*........ .90 .90 .90 .85 .85 .85 .80 .80 .80
JNL/Putnam Value
Equity**................ .90 .90 .90 .85 .85 .85 .80 .80 .80
PPM America/JNL
Balanced***............. .75 .70 .70 .675 .675 .675 .65 .65 .625
PPM America/JNL High Yield
Bond.................... .75 .70 .70 .675 .675 .675 .65 .65 .625
PPM/America JNL Money
Market.................. .60 .60 .60 .575 .575 .575 .55 .55 .525
Salomon Brothers/JNL
Global Bond............. .85 .85 .85 .80 .80 .80 .80 .80 .75
Salomon Brothers/JNL U.S.
Government & Quality
Bond.................... .70 .70 .70 .65 .65 .65 .60 .60 .55
T. Rowe Price/JNL
Established Growth...... .85 .85 .85 .80 .80 .80 .80 .80 .80
T. Rowe Price/JNL
International Equity
Investment.............. 1.10 1.05 1.05 1.00 1.00 1.00 .95 .95 .90
T. Rowe Price/JNL Mid-Cap
Growth.................. .95 .95 .95 .90 .90 .90 .90 .90 .90
</TABLE>

- -------------------------
* Prior to May 1, 1997, the fee for the JNL/Putnam Growth Series was .90%,
.85%, .80%, .75%, and .70%, respectively.

** Prior to May 1, 1997, the fee for the JNL/Putnam Value Equity Series was
.75%, .70%, .675%, .65% and .625%, respectively.

*** Prior to May 1, 1997, the fee for the PPM America/JNL Balanced Series was
.90%, .80%, .75%, .70% and .65%, respectively.

37
<PAGE> 38

INVESTMENT SUB-ADVISERS

The organizations described below act as sub-advisers to the Trust and
certain of its Series pursuant to Sub-Advisory Agreements with JNFSI. Under the
Sub-Advisory Agreements, the sub-advisers manage the investment and reinvestment
of the assets of the respective Series for which they are responsible. Each of
the sub-advisers discharges its responsibilities subject to the policies of the
Trustees and the oversight and supervision of JNFSI, which pays the
sub-advisers' fees.

Fred Alger Management, Inc., ("Alger Management") which is located at 75
Maiden Lane, New York, New York 10038, serves as sub-adviser to the JNL/Alger
Growth Series. Alger Management is generally engaged in the business of
rendering investment advisory services to institutions and, to a lesser extent,
individuals. Alger Management has been engaged in the business of rendering
investment advisory services since 1964 and, as of December 31, 1996, had
approximately $7.1 billion under management, $5.2 billion in mutual fund
accounts and $1.9 billion in other advisory accounts. Alger Management is a
wholly owned subsidiary of Fred Alger & Company, Inc. which in turn is a wholly
owned subsidiary of Alger Associates, Inc., a financial services holding
company. Fred M. Alger III and his brother, David D. Alger are majority
shareholders of Alger Associates, Inc. and may be deemed to control that company
and its subsidiaries.

Janus Capital Corporation ("Janus Capital"), a Colorado corporation with
principal offices at 100 Fillmore Street, Denver, Colorado 80206, serves as sub-
adviser to the JNL Capital Growth Series, the JNL Aggressive Growth Series and
the JNL Global Equities Series. Janus Capital is an investment adviser with
approximately $50 billion in assets under management. Kansas City Southern
Industries, Inc. ("KCSI") owns approximately 83% of the outstanding voting stock
of Janus Capital, most of which it acquired in 1984. KCSI is a publicly-traded
holding company whose primary subsidiaries are engaged in transportation and
financial services. Thomas H. Bailey, President and Chairman of the Board of
Janus Capital, owns approximately 12% of its voting stock and, by agreement with
KCSI, selects a majority of Janus Capital's Board.

PPM America, Inc. ("PPM"), which is located at 225 West Wacker Drive,
Chicago, Illinois 60606, serves as sub-adviser to the PPM America/JNL Balanced
Series*, the PPM America/JNL High Yield Bond Series and the PPM America/JNL
Money Market Series. PPM, an affiliate of JNFSI, is a wholly owned subsidiary of
Prudential Portfolio Managers Ltd., ("PPM Ltd.") an investment management
company engaged in global money management, which is in turn wholly owned by
Prudential Corporation plc. PPM Ltd. and its subsidiaries manage over $120
billion in various currencies and markets. PPM currently manages over $26
billion of Jackson National Life Insurance Company assets. Additionally, PPM
manages assets of over $5.7 billion for other affiliated companies and over $878
million for non-affiliated entities.

Putnam Investment Management, Inc. ("Putnam"), located at One Post Office
Square, Boston, Massachusetts 02109, serves as sub-adviser to the JNL/Putnam
Growth Series* and the JNL/Putnam Value Equity Series*. Putnam has been managing
mutual funds since 1937. Putnam and its affiliates had approximately $173
billion in assets under management as of December 31, 1996. Putnam is a
subsidiary of Putnam Investment, Inc., which is wholly owned by Marsh & McLennan
Companies, Inc., a publicly-owned holding company whose principal businesses are
international insurance and reinsurance brokerage, employee benefit consulting
and investment management.

Rowe Price-Fleming International, Inc. ("Price-Fleming"), located at 100
East Pratt Street, Baltimore, Maryland 21202, serves as sub-adviser to the T.
Rowe Price/JNL International Equity Investment Series. Price-Fleming was founded
in 1979 as a joint venture between T. Rowe Price Associates, Inc. and Robert
Fleming Holdings Limited. Price-Fleming is one of America's largest
international mutual fund asset managers with approximately $18 billion under
management in its offices in Baltimore, London, Tokyo, Hong Kong and Singapore.

- ---------------

*Prior to May 1, 1997, Phoenix Investment Counsel, Inc. served
as sub-adviser to the PPM America/JNL Balanced Series and the JNL/Putnam Growth
Series, and PPM served as sub-adviser to the JNL/Putnam Value Equity Series.

38
<PAGE> 39

Salomon Brothers Asset Management Inc ("SBAM") serves as sub-adviser to the
Salomon Brothers/JNL Global Bond Series and the Salomon Brothers/JNL U.S.
Government & Quality Bond Series. SBAM is an indirect, wholly owned subsidiary
of Salomon Brothers Holding Company Inc. which is, in turn, wholly owned by
Salomon Inc. ("SI"). SBAM was incorporated in 1987, and, together with
affiliates in London, Frankfurt, Tokyo and Hong Kong, SBAM provides a broad
range of fixed income and equity investment advisory services to various
individual and institutional clients located throughout the world and serves as
sub-advisor to various investment companies. In providing such investment
advisory services, SBAM has access to SI's more than 400 economists, mortgage
bond, sovereign and equity analysts. As of December 31, 1996, SBAM and its
worldwide investment affiliates managed approximately $17.8 billion. SBAM's
business offices are located at 7 World Trade Center, New York, New York 10048.

In connection with SBAM's service as sub-adviser to the Salomon
Brothers/JNL Global Bond Series, SBAM Limited, whose business address is
Victoria Plaza, 111 Buckingham Palace Road, London SW1W OSB, England, provides
certain sub-advisory services to SBAM relating to currency transactions and
investments in non-dollar denominated debt securities for the benefit of the
Series. SBAM Limited is compensated by SBAM at no additional expense to the
Trust. Like SBAM, SBAM Limited is an indirect, wholly-owned subsidiary of
Salomon Brothers Holding Company Inc. SBAM Limited is a member of the Investment
Management Regulatory Organization Limited in the United Kingdom and is
registered as an investment adviser in the United States pursuant to the
Investment Advisers Act of 1940, as amended.

On September 24, 1997, Travelers Group ("Travelers") and SI, the ultimate
parent company of SBAM, announced their agreement to merge SI with and into
Smith Barney Holdings Inc., a subsidiary of Travelers, to form a new company
expected to be called Salomon Smith Barney Holdings Inc. (the "Transaction").
Travelers is a diversified financial services company engaged in the investment
services, asset management, consumer finance and life and property casualty
insurance services. The Transaction is expected to be completed by November 30,
1997, subject to a number of conditions, including the receipt of U.S. and
foreign regulatory approvals and the approval of SI stockholders. Upon
consummation of the Transaction, Travelers will become the ultimate parent of
SBAM, which will continue to serve as investment adviser to the Series SBAM
advises.

T. Rowe Price Associates, Inc. ("T. Rowe"), located at 100 East Pratt
Street, Baltimore, Maryland 21202, serves as sub-adviser to the T. Rowe
Price/JNL Established Growth Series and the T. Rowe Price/JNL Mid-Cap Growth
Series. T. Rowe was founded in 1937 by the late Thomas Rowe Price, Jr. T. Rowe
and its affiliates manage over $95 billion for approximately 4.5 million
individual and institutional investor accounts, including limited and real
estate partnerships and other mutual funds.

PORTFOLIO MANAGEMENT

The following individuals are primarily responsible for the day-to-day
management of the particular Series as indicated below.

JNL GLOBAL EQUITIES SERIES

Helen Young Hayes is responsible for the day-to-day management of the JNL
Global Equities Series. Ms. Hayes joined Janus Capital in 1987. She holds a
Bachelor of Arts in Economics from Yale University and is a Chartered Financial
Analyst.

JNL CAPITAL GROWTH SERIES

James P. Goff is responsible for the day-to-day management of the JNL
Capital Growth Series. Mr. Goff joined Janus Capital in 1988. He holds a
Bachelor of Arts in Economics from Yale University and is a Chartered Financial
Analyst.

JNL AGGRESSIVE GROWTH SERIES

Warren B. Lammert is responsible for the day-to-day management of the JNL
Aggressive Growth Series. Mr. Lammert joined Janus Capital in 1987. He holds a
Bachelor of Arts in Economics from Yale University and a Master of Science in
Economic History from the London School of Economics. He is a Chartered
Financial Analyst.

39
<PAGE> 40

JNL/ALGER GROWTH SERIES

David D. Alger, President and Chief Investment Officer of Alger
Management, is primarily responsible for the day-to-day management of the
JNL/Alger Growth Series. He has been employed by Alger Management as Executive
Vice President and Director of Research since 1971 and he serves as portfolio
manager for other mutual funds and investment accounts managed by Alger
Management. Also participating in the management of the Series are Ronald
Tartaro and Seilai Khoo. Mr. Tartaro has been employed by Alger Management
since 1990 and he serves as a senior research analyst. Prior to 1990, he was a
member of the technical staff at AT&T Bell Laboratories. Ms. Khoo has been
employed by Alger Management since 1989 and she serves as a senior research
analyst.

JNL/PUTNAM GROWTH SERIES

Carol C. McMullen has responsibility for the day-to-day management of the
JNL/Putnam Growth Series. Ms. McMullen has been a Managing Director of Putnam
since 1995. Prior to joining Putnam, Ms. McMullen was Senior Vice President of
Baring Asset Management. Ms. McMullen has had responsibility for the day-to-day
management of the JNL/Putnam Growth Series since May 1, 1997.

JNL/PUTNAM VALUE EQUITY SERIES

Anthony I. Kreisel a Managing Director of Putnam, has responsibility for
the day-to-day management of the JNL/Putnam Value Equity Series. Mr. Kreisel has
been an investment professional at Putnam since 1986. Mr. Kreisel has had
responsibility for the day-to-day management of the JNL/Putnam Value Equity
Series since May 1, 1997.

PPM AMERICA/JNL BALANCED SERIES

PPM AMERICA/JNL HIGH YIELD BOND SERIES

PPM AMERICA/JNL MONEY MARKET SERIES

In its capacity as sub-adviser, PPM supervises and manages the investment
portfolios of the PPM America/ JNL Balanced Series, the PPM America/JNL High
Yield Bond Series and the PPM America/JNL Money Market Series and directs the
purchase and sale of each Series' investment securities. PPM utilizes teams of
investment professionals acting together to manage the assets of the Series. The
teams meet regularly to review portfolio holdings and to discuss purchase and
sale activity. The teams adjust holdings in the portfolios as they deem
appropriate in the pursuit of the Series' investment objectives. PPM has
supervised and managed the investment portfolio of the PPM America/JNL Balanced
Series since May 1, 1997, and has supervised and managed the investment
portfolios of the PPM America/JNL High Yield Bond Series and the PPM America/JNL
Money Market Series since the commencement of operations of each Series.

SALOMON BROTHERS/JNL GLOBAL BOND SERIES

SALOMON BROTHERS/JNL U.S. GOVERNMENT & QUALITY BOND SERIES

Steven Guterman is primarily responsible for the day-to-day management of
the Salomon Brothers/JNL U.S. Government & Quality Bond Series and the
mortgage-backed securities and U.S. Government securities portions of the
Salomon Brothers/JNL Global Bond Series. Mr. Guterman co-manages the Salomon
Brothers/JNL U.S. Government & Quality Bond Series with Roger Lavan.

Mr. Guterman, who joined SBAM in 1990, is a Managing Director of Salomon
Brothers Inc and a Managing Director and Senior Portfolio Manager of SBAM,
responsible for SBAM's investment company and institutional portfolios which
invest primarily in mortgage-backed securities and U.S. Government issues. Mr.
Guterman also serves as portfolio manager for two offshore mortgage funds and a
number of institutional clients. Mr. Guterman joined Salomon Brothers Inc in
1983, working initially in the mortgage research group where he became a
Research Director and later traded derivative mortgage-backed securities.

40
<PAGE> 41

mortgage-backed securities and U.S. Government securities. Prior to joining
SBAM, Mr. Lavan spent four years analyzing portfolios for Salomon Brothers Inc's
Fixed Income Sales Group and Product Support Divisions.

Peter J. Wilby is primarily responsible for the day-to-day management of
the high yield and emerging market debt securities portions of the Salomon
Brothers/JNL Global Bond Series. Beth Semmel assists Mr. Wilby in the day-to-day
management of the Salomon Brothers/JNL Global Bond Series. Mr. Wilby, who joined
SBAM in 1989, is a Managing Director of Salomon Brothers Inc and SBAM and Senior
Portfolio Manager of SBAM, is responsible for investment company and
institutional portfolios which invest in high yield non-U.S. and U.S. corporate
debt securities and high yield foreign sovereign debt securities. From 1984 to
1989, Mr. Wilby was employed by Prudential Capital Management Group
("Prudential") where he served as Director of Prudential's credit research unit
and as a corporate and sovereign credit analyst with Prudential. Mr. Wilby also
managed high yield bonds and leveraged equities in the mutual funds and
institutional portfolios at Prudential. Ms. Semmel is a Director and Portfolio
Manager of SBAM and a Director of Salomon Brothers Inc. Ms. Semmel joined SBAM
in May of 1993, where she manages high yield portfolios. Prior to joining SBAM,
Ms. Semmel spent four years as a high yield bond analyst at Morgan Stanley Asset
Management.

David J. Scott is primarily responsible for currency transactions and
investments in non-dollar denominated debt securities for the Salomon
Brothers/JNL Global Bond Series. Prior to joining SBAM Limited in April 1994,
Mr. Scott worked for four years at JP Morgan Investment Management ("JP Morgan")
where he was responsible for global and non-dollar portfolios for clients
including departments of various governments, pension funds and insurance
companies. Before joining JP Morgan, Mr. Scott worked for three years at Mercury
Asset Management where he was responsible for captive insurance portfolios and
products.

T. ROWE PRICE/JNL ESTABLISHED GROWTH SERIES

Robert W. Smith is responsible for the day-to-day management of the T. Rowe
Price/JNL Established Growth Series. Mr. Smith is a Vice President and Equity
Portfolio Manager for T. Rowe and Price-Fleming. He is also responsible for the
North American component of other investment company and institutional client
portfolios. Prior to joining T. Rowe in 1992, Mr. Smith was employed as an
Investment Analyst for Massachusetts Financial Services. He earned a BS (finance
and economics) from the University of Delaware and an MBA (finance) from the
Darden Graduate School of Business Administration, University of Virginia. Mr.
Smith has had responsibility for the day-to-day management of the T. Rowe
Price/JNL Established Growth Series since February 21, 1997.

T. ROWE PRICE/JNL INTERNATIONAL EQUITY INVESTMENT SERIES

The T. Rowe Price/JNL International Equity Investment Series has an
investment advisory group that has day-to-day responsibility for managing the
Series and developing and executing the Series' investment program. The Series'
advisory group is composed of the following members: Martin G. Wade, Christopher
D. Alderson, Peter B. Askew, Mark J.T. Edward, John R. Ford, James B.M. Seddon,
Benedict R.F. Thomas, and David J.J. Warren.

Martin Wade joined Price-Fleming in 1979 and has 26 years of experience
with the Fleming Group in research, client service, and investment management.
(Fleming Group includes Robert Fleming and/or Jardine Fleming Group Limited).
Christopher Alderson joined Price-Fleming in 1988 and has nine years of
experience with the Fleming Group in research and portfolio management. Peter
Askew joined Price-Fleming in 1988 and has 20 years of experience managing
multi-currency fixed income portfolios. Mark Edwards joined Price-Fleming in
1986 and has 14 years of experience in financial analysis. John Ford joined
Price-Fleming in 1982 and has 15 years of experience with the Fleming Group in
research and portfolio management. James Seddon joined Price-Fleming in 1987 and
has eight years of experience in investment management. Benedict Thomas joined
Price-Fleming in 1988 and has six years of portfolio management experience.
David Warren joined Price-Fleming in 1984 and has 15 years of experience in
equity research, fixed income research and portfolio management.

41
<PAGE> 42

T. ROWE PRICE/JNL MID-CAP GROWTH SERIES

The T. Rowe Price/JNL Mid-Cap Growth Series has an Investment Advisory
Committee composed of the following members: Brian W. Berghuis, Chairman, James
A.C. Kennedy, and John F. Wakeman. The Committee Chairman has day to day
responsibility for managing the Series and works with the Committee in
developing and executing the Series' investment program. Mr. Berghuis has been
managing investments since joining T. Rowe in 1985.

SUB-ADVISORY ARRANGEMENTS

Under the terms of each of the Sub-Advisory Agreements, the sub-adviser
manages the investment and reinvestment of the assets of the assigned Series,
subject to the supervision of the Trustees of the Trust. The sub-adviser
formulates a continuous investment program for each such Series consistent with
its investment objectives and policies outlined in this Prospectus. Each
sub-adviser implements such programs by purchases and sales of securities and
regularly reports to JNFSI and the Trustees of the Trust with respect to the
implementation of such programs.

As compensation for their services, the sub-advisers receive fees from
JNFSI computed separately for each Series. The fee for each Series is stated as
an annual percentage of the current value of the net assets of such Series. The
fees are calculated on the basis of the average net assets of each Series made
at the close of business on each business day of the Trust during the period for
which such fees are paid through the date of calculation. Once the average net
assets of a Series exceed specified amounts, the fee is reduced with respect to
such excess. The following is a schedule of the management fees JNFSI currently
is obligated to pay the sub-advisers out of the advisory fee it receives from
each Series as specified above:

42
<PAGE> 43

<TABLE>
<CAPTION>
(M -- MILLION) $0 TO $50 M TO $100 M TO $150 M TO $200 M TO $250 M TO $300 M TO $350 M TO OVER
$50 M $100 M $150 M $200 M $250 M $300 M $350 M $500 M $500 M
% % % % % % % % %
SERIES ----- -------- --------- --------- --------- --------- --------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
JNL Aggressive Growth.... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL Capital Growth....... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL Global Equities...... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL/Alger Growth......... .55 .55 .55 .55 .55 .55 .50 .50 .45
JNL/Putnam Growth*....... .50 .50 .50 .45 .45 .45 .35 .35 .35
JNL/Putnam Value
Equity**............... .50 .50 .50 .45 .45 .45 .35 .35 .35
PPM America/JNL
Balanced*.............. .25 .20 .20 .175 .175 .175 .15 .15 .125
PPM America/JNL High
Yield Bond............. .25 .20 .20 .175 .175 .175 .15 .15 .125
PPM America/JNL Money
Market................. .20 .15 .15 .125 .125 .125 .10 .10 .075
Salomon Brothers/JNL
Global Bond............ .375 .35 .35 .30 .30 .30 .30 .30 .25
Salomon Brothers/JNL U.S.
Government & Quality
Bond................... .225 .225 .225 .175 .175 .175 .15 .15 .10
</TABLE>

<TABLE>
<CAPTION>
$0 TO $20 TO $50 TO
$20 M $50 M $200 M $200 M+
----- ------ ------ -------
<S> <C> <C> <C> <C>
T. Rowe Price/JNL Established Growth Series................. .45% .40% .40%*** .40%
T. Rowe Price/JNL International Equity Investment Series.... .75% .60% .50% .50%***
T. Rowe Price/JNL Mid-Cap Growth Series..................... .60% .50% .50%*** .50%
</TABLE>

* Prior to May 1, 1997, the sub-advisory fees for these Series were payable
to Phoenix Investment Counsel, Inc. and were: $0 to $50 million -- .50%;
$50 to $150 million -- .40%; $150 to $300 million -- .30%; $300 to $500
million -- .25%; over $500 million -- .20%.

** Prior to May 1, 1997, the sub-advisory fee for this Series was payable to
PPM and was: $0 to $50 million -- .25%; $50 to $150 million -- .20%; $150
to $300 million -- .175%; $300 to $500 million -- .15%; over $500 million
-- .125%.

*** When average net assets exceed this amount, the sub-advisory fee asterisked
is applicable to all amounts in this Series.

43
<PAGE> 44

The sub-advisory fees payable to a sub-adviser may be reduced as agreed to
by the parties from time to time. With respect to the Salomon Brothers/JNL
Global Bond Series and in connection with the advisory consulting agreement
between Salomon Brothers and SBAM Limited, Salomon Brothers will pay SBAM
Limited, as full compensation for all services provided under the advisory
consulting agreement, a portion of its investment management fee. The amount
payable to SBAM Limited will be equal to the fee payable under Salomon Brothers'
sub-advisory agreement multiplied by the portion of the assets of the Series
that SBAM Limited has been delegated to manage divided by the current value of
the net assets of the Series.

OTHER TRUST EXPENSES

In addition to the investment advisory fee, the Trust incurs expenses,
including legal, auditing and accounting expenses, Trustees' fees and expenses,
insurance premiums, brokers' commissions, taxes and governmental fees, expenses
of issue or redemption of shares, expenses of registering or qualifying shares
for sale, reports and notices to shareholders, and fees and disbursements of
custodians, transfer agents, registrars, shareholder servicing agents and
dividend disbursing agents, and certain expenses with respect to membership fees
of industry associations.

- --------------------------------------------------------------------------------
INVESTMENT IN TRUST SHARES
- --------------------------------------------------------------------------------

An insurance company purchases the shares of the Series at their net asset
value using premiums received on Policies issued by Accounts. These Accounts are
funded by shares of the Trust. There is no sales charge. All shares are sold at
net asset value.

The net asset value per share of each Series is determined at the close of
regular trading on the New York Stock Exchange (normally 4:00 p.m., Eastern
time) each day that the New York Stock Exchange is open. The net asset value per
share is calculated by adding the value of all securities and other assets of a
Series, deducting its liabilities, and dividing by the number of shares
outstanding.

Shares of the Trust are currently sold primarily to separate accounts of
Jackson National Life Insurance Company, 5901 Executive Drive, Lansing, Michigan
48911 to fund the benefits under variable insurance or annuity Policies.
Further, it is anticipated that shares of the Trust will be sold to certain
qualified retirement plans.

All investments in the Trust are credited to the shareholder's account in
the form of full and fractional shares of the designated Series (rounded to the
nearest 1/1000 of a share). The Trust does not issue share certificates.

- --------------------------------------------------------------------------------
SHARE REDEMPTION
- --------------------------------------------------------------------------------

An insurance company separate account redeems shares to make benefit or
surrender payments under the terms of its Policies. Redemptions are processed on
any day on which the Trust is open for business and are effected at net asset
value next determined after the redemption order, in proper form, is received by
the Trust's transfer agent.

The Trust may suspend the right of redemption only under the following
unusual circumstances:

- when the New York Stock Exchange is closed (other than weekends and
holidays) or trading is restricted;

- when an emergency exists, making disposal of portfolio securities or the
valuation of net assets not reasonably practicable; or

- during any period when the SEC has by order permitted a suspension of
redemption for the protection of shareholders.

44
<PAGE> 45

- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------

DESCRIPTION OF SHARES -- The Declaration of Trust permits the Trustees to
issue an unlimited number of full and fractional shares of beneficial interest
of each Series and to divide or combine such shares into a greater or lesser
number of shares without thereby changing the proportionate beneficial interests
in the Trust. Each share of a Series represents an equal proportional interest
in that Series with each other share. The Trust reserves the right to create a
number of different Series. In that case, the shares of each Series would
participate equally in the earnings, dividends, and assets of the particular
Series. Upon liquidation of a Series, its shareholders are entitled to share pro
rata in the net assets of such Series available for distribution to
shareholders.

SERIES TRANSACTIONS -- The Trust's portfolio transactions are executed
through brokers who are considered by the appropriate sub-adviser as able to
provide execution at the most favorable prices and in the most effective manner.
Portfolio security transactions may be executed through brokers who are
affiliated with the Trust, JNFSI or a sub-adviser. In addition, brokers may be
selected taking into account such brokers' assistance in the purchase of
variable annuity contracts funded by the Trust (although such assistance or
absence thereof is neither a qualifying nor a disqualifying factor in such
selection). See the Statement of Additional Information for more detailed
information.

VOTING RIGHTS -- Except for matters affecting a particular Series, as
described below, all shares of the Trust have equal voting rights and may be
voted in the election of Trustees and on other matters submitted to the vote of
the shareholders. Shareholders' meetings ordinarily will not be held unless
required by the 1940 Act. As permitted by Massachusetts law, there normally will
be no shareholders' meetings for the purpose of electing Trustees unless and
until such time as fewer than a majority of the Trustees holding office have
been elected by shareholders. At that time, the Trustees then in office will
call a shareholders' meeting for the election of Trustees. The Trustees must
call a meeting of shareholders for the purpose of voting upon the removal of any
Trustee when requested to do so by the record holders of 10% of the outstanding
shares of the Trust. A Trustee may be removed after the holders of record of not
less than two-thirds of the outstanding shares have declared that the Trustee be
removed either by declaration in writing or by votes cast in person or by proxy.
Except as set forth above, the Trustees shall continue to hold office and may
appoint successor Trustees, provided that immediately after the appointment of
any successor Trustee, at least two-thirds of the Trustees have been elected by
the shareholders. Shares do not have cumulative voting rights. Thus, holders of
a majority of the shares voting for the election of Trustees can elect all the
Trustees. No amendment may be made to the Declaration of Trust without the
affirmative vote of a majority of the outstanding shares of the Trust, except
that amendments to conform the Declaration to the requirements of applicable
federal laws or regulations or the regulated investment company provisions of
the Code may be made by the Trustees without the vote or consent of
shareholders. If not terminated by the vote or written consent of a majority of
its outstanding shares, the Trust will continue indefinitely.

In matters affecting only a particular Series, the matter shall have been
effectively acted upon by a majority vote of that Series even though: (1) the
matter has not been approved by a majority vote of any other Series; or (2) the
matter has not been approved by a majority vote of the Trust.

Shareholders of a Massachusetts business trust may, under certain
circumstances, be held personally liable as partners for the obligations of the
Trust. The risk of a shareholder incurring any financial loss on account of
shareholder liability is limited to circumstances in which the Trust itself
would be unable to meet its obligations. The Declaration of Trust contains an
express disclaimer of shareholder liability for acts or obligations of the Trust
and provides that notice of the disclaimer must be given in each agreement,
obligation or instrument entered into or executed by the Trust or Trustees. The
Declaration of Trust provides for indemnification of any shareholder held
personally liable for

45
<PAGE> 46

the obligations of the Trust and also provides for the Trust to reimburse the
shareholder for all legal and other expenses reasonably incurred in connection
with any such claim or liability.

- --------------------------------------------------------------------------------
PERFORMANCE ADVERTISING FOR THE SERIES
- --------------------------------------------------------------------------------

The Trust may from time to time advertise several types of historical
performance for the Series. The performance advertised will be based on
historical results and is not intended to indicate future performance. The
performance figures advertised for a Series may or may not reflect the effect of
any charges that are imposed under a variable annuity or variable life contract
that is funded by the Trust. Such charges, described in the variable annuity or
variable life prospectus, will have the effect of reducing the performance
described below.

Each Series may advertise standardized average annual total return,
calculated in a manner prescribed by the Securities and Exchange Commission, and
non-standardized total return. Standardized average annual total return will
show the percentage rate of return of a hypothetical initial investment of
$1,000 for the most recent one, five and ten year periods, or for a period
covering the time the Series has been in existence if the Series has not been in
existence for one of the prescribed periods. Because average annual total
returns tend to smooth out variations in the Series' returns, you should
recognize that they are not the same as actual year-by-year results.
Non-standardized total return may be for periods other than those required to be
presented or may otherwise differ from standardized average annual total return.

Each Series may also advertise yield, and the PPM America/JNL Money Market
Series may also advertise effective yield. Yield, as calculated by each Series
other than the PPM America/JNL Money Market Series, refers to the annualized
income generated by an investment in the Series over a specified thirty-day
period. The yield is calculated by assuming that the income generated by the
investment during that thirty-day period is generated each thirty-day period
over a twelve-month period and is shown as a percentage of the investment.
Yield, as calculated by the PPM America/JNL Money Market Series, is a measure of
the net dividend and interest income earned over a specific seven-day period
expressed as a percentage of the offering price of the Series. The yield is an
annualized figure, which means that it is assumed that the Series generates the
same level of net income over a 52-week period. Effective yield is calculated
under rules prescribed by the Securities and Exchange Commission and assumes a
weekly reinvestment of income earned. The effective yield will be slightly
higher than the yield due to this compounding effect. Because yield accounting
methods differ from the methods used for financial reporting and tax accounting
purposes, a Series' yield may not equal its distribution rate, the income paid
to a shareholder's account, or the income reported in the Series' financial
statements.

The performance of the Series may be compared to the performance of other
mutual funds or mutual fund indices with similar objectives and policies as
reported by Lipper Analytical Services, Inc. ("Lipper"), CDA Investment
Technologies, Inc. ("CDA") or Donoghue's Money Fund Report. Lipper and CDA
performance calculations are based upon changes in net asset value with all
dividends reinvested and do not include the effect of any sales charges. The
Series' performance may also be compared to that of the Consumer Price Index or
various unmanaged stock and bond indices including, but not limited to, Salomon
Brothers Broad Investment Grade Index, Lehman Brothers High Yield Index, Lehman
Brothers Aggregate Bond Index, Salomon Brothers Treasury Index, S&P MidCap 400
Index, Morgan Stanley Capital International World Index, Morgan Stanley Europe
and Australasia, Far East Equity Index, Russell 2000 Index, Russell Midcap
Index, and S&P 500 Index.

From time to time, a Series also may quote information from publications
including, but not limited to, the following: Morningstar, Inc., The Wall Street
Journal,

46
<PAGE> 47

Money Magazine, Forbes, Barron's, The New York Times, USA Today, Institutional
Investor and Registered Representative. Also, investors may want to compare the
historical returns of various investments, performance indices of those
investments or economic indicators, including but not limited to stocks, bonds,
certificates of deposit and other bank products, money market funds and U.S.
Treasury obligations. Certain of these alternative investments may offer fixed
rates of return and guaranteed principal, and may be insured. Economic
indicators may include, without limitation, indicators of market rate trends and
cost of funds, such as Federal Home Loan Bank Board 11th District Cost of Funds
Index (COFI).

Each Series' shares are sold at net asset value. Each Series' returns will
fluctuate. Shares of a Series are redeemable by an investor at the then current
net asset value, which may be more or less than original cost. Additional
information concerning each Series' performance appears in the Statement of
Additional Information, and in the Trust's Annual Report to Shareholders which
may be obtained, without charge, by writing or calling the Trust.

SHAREHOLDER INQUIRIES -- All inquiries regarding the Trust should be
directed to the Trust at the telephone number or address shown on the cover page
of this Prospectus.

- --------------------------------------------------------------------------------
TAX STATUS
- --------------------------------------------------------------------------------

The Trust's policy is to meet the requirements of Subchapter M of the
Internal Revenue Code. Each Series intends to distribute all its taxable net
investment income and capital gains to shareholders, and therefore, will not be
required to pay any federal income taxes.

Each Series of the Trust is treated as a separate entity for purposes of
the regulated investment company provisions of the Internal Revenue Code, and,
therefore, the assets, income, and distributions of each Series are considered
separately for purposes of determining whether or not the Series qualifies as a
regulated investment company.

47
<PAGE> 48

CUSTODIAN

State Street Bank and Trust Company
1776 Heritage Drive
North Quincy, Massachusetts 02171

INDEPENDENT ACCOUNTANTS

Price Waterhouse LLP
100 East Wisconsin Avenue
Milwaukee, Wisconsin 53202

LEGAL COUNSEL

Blazzard, Grodd & Hasenauer, P.C.
943 Post Road East
Westport, CT 06880

INVESTMENT ADVISER AND TRANSFER AGENT

Jackson National Financial Services, Inc.
5901 Executive Drive
Lansing, Michigan 48911

48
<PAGE> 49

- --------------------------------------------------------------------------------
APPENDIX A -- RATINGS OF INVESTMENTS
- --------------------------------------------------------------------------------

COMMERCIAL PAPER RATINGS

A-1, A-2 AND PRIME-1, PRIME-2 COMMERCIAL PAPER RATINGS

Commercial paper rated by Standard & Poor's Ratings Group has the following
characteristics: Liquidity ratios are adequate to meet cash requirements.
Long-term senior debt is rated "A" or better. The issuer has access to at least
two additional channels of borrowing. Basic earnings and cash flow have an
upward trend with allowance made for unusual circumstances. Typically, the
issuer's industry is well established and the issuer has a strong position
within the industry. The reliability and quality of management are unquestioned.
Relative strength or weakness of the above factors determine whether the
issuer's commercial paper is rated A-1 or A-2.

The ratings Prime-1 and Prime-2 are the two highest commercial paper
ratings assigned by Moody's Investors Service, Inc. Among the factors considered
by it in assigning ratings are the following: (1) evaluation of the management
of the issuer; (2) economic evaluation of the issuer's industry or industries
and an appraisal of speculative-type risks which may be inherent in certain
areas; (3) evaluation of the issuer's products in relation to competition and
customer-acceptance; (4) liquidity; (5) amount and quality of long-term debt;
(6) trend of earnings over a period of ten years; (7) financial strength of a
parent company and the relationships which exist with the issuer; and (8)
recognition by the management of obligations which may be present or may arise
as a result of public interest questions and preparations to meet such
obligations. Relative strength or weakness of the above factors determines
whether the issuer's commercial paper is rated Prime-1 or 2.

CORPORATE BONDS

STANDARD & POOR'S RATINGS GROUP BOND RATINGS

AAA. Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA. Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher rated issued only in small degree.

A. Debt rated A has a strong capacity to pay interest and repay principal
although it is somewhat more susceptible to the adverse effects of changes in
circumstances and economic conditions than debt in higher rated categories.

BBB. Debt rated BBB is regarded as having an adequate capacity to pay
interest and repay principal. Whereas it normally exhibits adequate protection
parameters, adverse economic conditions or changing circumstances are more
likely to lead to a weakened capacity to pay interest and repay principal for
debt in this category than in higher rated categories.

BB, B, CCC, CC, C. Debt rated BB, B, CCC, CC, and C is regarded, on
balance, as predominantly speculative with respect to capacity to pay interest
and repay principal in accordance with the terms of the obligation. BB indicates
the lowest degree of speculation and C the highest degree of speculation. While
such debt will likely have some quality and protective characteristics, these
are outweighed by large uncertainties or major risk exposures to adverse
conditions.

CI. The rating CI is reserved for income bonds on which no interest is
being paid.

D. Debt rated D is in default, and payment of interest and/or repayment of
principal is in arrears.

A-1
<PAGE> 50

MOODY'S INVESTORS SERVICE, INC. BOND RATINGS

AAA. Bonds which are rated Aaa are judged to be of the best quality. They
carry the smallest degree of investment risk and are generally referred to as
"gilt-edge." Interest payments are protected by a large or by an exceptionally
stable margin and principal is secure. While the various protective elements are
likely to change, such changes as can be visualized are most unlikely to impair
the fundamentally strong position of such issues.

AA. Bonds which are rated Aa are judged to be of high quality by all
standards. Together with the Aaa group, they comprise what are generally known
as high grade bonds. They are rated lower than the best bonds because margins of
protection may not be as large as in Aaa securities or fluctuation of protective
elements may be of greater amplitude or there may be other elements present
which make the long-term risks appear somewhat larger than in Aaa securities.

A. Bonds which are rated A possess many favorable investment attributes and
are to be considered as upper medium grade obligations. Factors giving security
to principal and interest are considered adequate but elements may be present
which suggest a susceptibility to impairment sometime in the future.

BAA. Bonds which are rated Baa are considered as medium grade obligations,
i.e., they are neither highly protected nor poorly secured. Interest payments
and principal security appear adequate for the present but certain protective
elements may be lacking or may be characteristically unreliable over any great
length of time.

Such bonds lack outstanding investment characteristics and, in fact, have
speculative characteristics as well.

BA. Bonds which are rated Ba are judged to have speculative elements; their
future cannot be considered as well assured. Often the protection of interest
and principal payments may be very moderate and thereby not well safeguarded
during both good and bad times over the future. Uncertainty of position
characterizes bonds in this class.

B. Bonds which are rated B generally lack characteristics of the desirable
investment. Assurance of interest and principal payments or of maintenance of
other terms of the contract over any long period of time may be small.

CAA. Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal and
interest.

CA. Bonds which are rated Ca represent obligations which are speculative in
a high degree. Such issues are often in default or have other marked
shortcomings.

C. Bonds which are rated C are the lowest rated class of bonds and issues
so rated can be regarded as having extremely poor prospects of ever attaining
any real investment standing.

MUNICIPAL BONDS

STANDARD & POOR'S RATINGS GROUP MUNICIPAL BOND RATINGS

AAA. Bonds rated AAA have the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA. Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the higher rated issues only in small degree.

A. Bonds which are rated A have a strong capacity to pay interest and repay
principal although they are somewhat more susceptible to the adverse effects of
changes in circumstances and economic conditions than debt in higher rated
categories.

BBB. Bonds which are rated BBB are regarded as having an adequate capacity
to pay interest and repay principal. Whereas they normally exhibit adequate
protection parameters, adverse economic conditions or changing circumstances are
more likely to lead to a weakened capacity to pay interest and repay principal
for bonds in this category than for bonds in higher rated categories.

Plus (+) or Minus (-): The ratings from "AA" to "B" may be modified by the
addition of a plus or minus

A-2
<PAGE> 51

sign to show relative standing within the major rating categories.

MOODY'S INVESTORS SERVICE, INC. MUNICIPAL BOND RATINGS

NOTE: Moody's applies numerical modifiers, 1, 2 AND 3 in each generic
rating classification from "AA" through "B" in its corporate bond rating system.
The modifier 1 indicates that the security ranks in the higher end of its
generic rating category; the modifier 2 indicates a mid-range ranking; and the
modifier indicates that the issue ranks in the lower end of its generic rating
category.

A-3
<PAGE> 52

PROSPECTUS
January 2, 1998

JNL(R) SERIES TRUST
- --------------------------------------------------------------------------------
5901 Executive Drive - Lansing, Michigan 48911

JNL/EAGLE CORE EQUITY SERIES seeks as its investment objective long-term
capital appreciation and, secondarily, current income by investing primarily in
a diversified portfolio of common stocks which the sub-adviser believes offers
above-average potential for long-term capital appreciation.

JNL/EAGLE SMALLCAP EQUITY SERIES seeks as its investment objective
long-term capital appreciation by investing primarily in equity securities of
smaller companies which the sub-adviser believes offer potential for rapid
growth.

1
<PAGE> 53

intended that this Series will invest primarily in the common stocks of
companies believed by the sub-adviser to have opportunity for capital growth.

THE JNL AGGRESSIVE GROWTH SERIES, JNL CAPITAL GROWTH SERIES, JNL GLOBAL
EQUITIES SERIES, JNL/EAGLE CORE EQUITY SERIES, JNL/EAGLE SMALLCAP EQUITY SERIES,
PPM AMERICA/JNL BALANCED SERIES, AND SALOMON BROTHERS/JNL GLOBAL BOND SERIES MAY
INVEST IN HIGH YIELD, HIGH RISK BONDS. BONDS OF THIS TYPE ARE TYPICALLY SUBJECT
TO GREATER MARKET FLUCTUATIONS AND RISK OF LOSS OF INCOME AND PRINCIPAL DUE TO
DEFAULT BY THE ISSUER THAN ARE INVESTMENTS IN LOWER YIELDING, HIGHER RATED
BONDS. (SEE "INVESTMENT RISKS".)

2
<PAGE> 54

THE STATEMENT OF ADDITIONAL INFORMATION, DATED JANUARY 2, 1998, IS INCORPORATED
HEREIN BY REFERENCE.

- --------------------------------------------------------------------------------

TABLE OF CONTENTS
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
TOPIC PAGE
----- ----
<S> <C>
TRUST EXPENSES.............................................. 4

FINANCIAL HIGHLIGHTS........................................ 6

INVESTMENT OBJECTIVES AND POLICIES.......................... 14

COMMON TYPES OF SECURITIES AND MANAGEMENT PRACTICES......... 31

MANAGEMENT OF THE TRUST..................................... 40

INVESTMENT IN TRUST SHARES.................................. 49

SHARE REDEMPTION............................................ 49

ADDITIONAL INFORMATION...................................... 49

PERFORMANCE ADVERTISING FOR THE SERIES...................... 50

TAX STATUS.................................................. 52
</TABLE>

3
<PAGE> 55

- --------------------------------------------------------------------------------

TRUST EXPENSES
- --------------------------------------------------------------------------------

SHAREHOLDER TRANSACTION EXPENSES

<TABLE>
<S> <C>
MAXIMUM SALES LOAD IMPOSED ON PURCHASES NONE
MAXIMUM SALES LOAD IMPOSED ON REINVESTED DIVIDENDS NONE
DEFERRED SALES LOAD NONE
REDEMPTION FEES NONE
EXCHANGE FEE NONE
</TABLE>

ANNUAL SERIES OPERATING EXPENSES
(As a percentage of average net assets.)

<TABLE>
<CAPTION>
OTHER
MANAGEMENT EXPENSES(AFTER TOTAL SERIES
FEE REIMBURSEMENT) OPERATING EXPENSES
---------- -------------- ------------------
<S> <C> <C> <C>
JNL Aggressive Growth Series.............................. .95% .15% 1.10%
JNL Capital Growth Series................................. .95% .15% 1.10%
JNL Global Equities Series................................ 1.00% .15% 1.15%
JNL/Alger Growth Series................................... .975% .15% 1.125%
JNL/Eagle Core Equity Series.............................. .90% .15%* 1.05%
JNL/Eagle SmallCap Equity Series.......................... .95% .15%* 1.10%
JNL/Putnam Growth Series**................................ .90% .15% 1.05%
JNL/Putnam Value Equity Series**.......................... .90% .15% 1.05%
PPM America/JNL Balanced Series**......................... .75% .15% .90%
PPM America/JNL Money Market Series....................... .60% .15% .75%
Salomon Brothers/JNL Global Bond Series................... .85% .15% 1.00%
Salomon Brothers/JNL U.S. Government & Quality Bond
Series.................................................. .70% .15% .85%
T. Rowe Price/JNL Established Growth Series............... .85% .15% 1.00%
T. Rowe Price/JNL International Equity Investment
Series.................................................. 1.10% .15% 1.25%
T. Rowe Price/JNL Mid-Cap Growth Series................... .95% .15% 1.10%
</TABLE>

*The JNL/Eagle Core Equity Series and the JNL/Eagle SmallCap Equity Series
commenced operations on September 16, 1996. These are estimated expenses for the
first fiscal year of operation. Actual expenses may be greater or lesser than
those shown.

**The management fees for the JNL/Putnam Growth Series, JNL/Putnam Value
Equity Series and the PPM America/JNL Balanced Series were changed effective May
1, 1997. See "Management of the Trust." The changes represent an increase in
management fees for the JNL/Putnam Growth Series when net assets exceed $50
million, an increase in management fees for the JNL/Putnam Value Equity Series
at all net asset levels and a decrease in management fees for the PPM
America/JNL Balanced Series at all net asset levels.

Currently, Jackson National Financial Services, Inc. will reimburse each of
the Series for annual expenses (excluding Management Fees) in excess of .15% of
average daily net assets. Voluntary reimbursements to these Series may be
modified or discontinued at any time. Prior to reimbursement, Total Series
Operating Expenses as a percentage of net assets for the period ended December
31, 1996, were: JNL Aggressive Growth Series -- 1.40%; JNL Capital Growth Series
- -- 1.27%; JNL Global Equities Series -- 1.63%; JNL/Alger Growth Series -- 1.19%;
JNL/Putnam Growth Series -- 1.27%; JNL/Putnam Value Equity Series -- 1.53%; PPM
America/JNL Balanced Series -- 1.22%; PPM America/JNL Money Market Series --
.85%; Salomon Brothers/JNL Global Bond Series -- 1.44%; Salomon Brothers/JNL
U.S. Government & Quality Bond Series -- 1.37%; T. Rowe Price/JNL Established
Growth Series -- 1.11%; T. Rowe Price/JNL International Equity Investment Series
- -- 1.29%; and T. Rowe Price/JNL Mid-Cap Growth Series -- 1.14%; and are expected
to be: JNL/Eagle Core Equity Series -- 4.57% and JNL/Eagle SmallCap Equity
Series -- 4.77%.

4
<PAGE> 56

EXAMPLE -

The following example illustrates the expenses you would incur on a $1,000
investment, assuming (1) 5% annual return and (2) redemption at the end of each
time period:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
JNL Aggressive Growth Series................................ $11 $35 $61 $134
JNL Capital Growth Series................................... $11 $35 $61 $134
JNL Global Equities Series.................................. $12 $37 $63 $140
JNL/Alger Growth Series..................................... $11 $36 $62 $137
JNL/Eagle Core Equity Series................................ $11 $33 N/A N/A
JNL/Eagle SmallCap Equity Series............................ $11 $35 N/A N/A
JNL/Putnam Growth Series.................................... $11 $33 $58 $128
JNL/Putnam Value Equity Series.............................. $11 $33 $58 $128
PPM America/JNL Balanced Series............................. $ 9 $29 $50 $111
PPM America/JNL Money Market Series......................... $ 8 $24 $42 $93
Salomon Brothers/JNL Global Bond Series..................... $10 $32 $55 $122
Salomon Brothers/JNL U.S. Government & Quality Bond
Series.................................................... $ 9 $27 $47 $105
T. Rowe Price/JNL Established Growth Series................. $10 $32 $55 $122
T. Rowe Price/JNL International Equity Investment Series.... $13 $40 $69 $151
T. Rowe Price/JNL Mid-Cap Growth Series..................... $11 $35 $61 $134
</TABLE>

5
<PAGE> 57

- --------------------------------------------------------------------------------

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS

See notes to the financial statements.

6
<PAGE> 58
<TABLE>
<CAPTION>
JNL CAPITAL GROWTH SERIES JNL GLOBAL EQUITIES SERIES
----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
----------- ------------ ------------ ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
$14.46 $13.86 $10.00 $15.20 $13.75 $10.00
(0.03) 0.06 -- 0.10 0.03 0.10
0.72 0.70 4.70 2.60 2.72 4.02
------- ------- ------ -------- ------- -------
0.69 0.76 4.70 2.70 2.75 4.12
------- ------- ------ -------- ------- -------
-- -- -- -- (0.08) --
-- (0.16) (0.84) -- (0.90) (0.37)
-- -- -- -- (0.32) --
------- ------- ------ -------- ------- -------
-- (0.16) (0.84) -- (1.30) (0.37)
------- ------- ------ -------- ------- -------
0.69 0.60 3.86 2.70 1.45 3.75
------- ------- ------ -------- ------- -------
$15.15 $14.46 $13.86 $17.90 $15.20 $13.75
======= ======= ====== ======== ======= =======
4.77% 5.45% 47.94% 17.76% 19.99% 41.51%
$60,969 $36,946 $9,578 $112,333 $48,638 $16,141
1.10% 1.09% 1.09% 1.15% 1.14% 1.15%
(0.11)% 0.91% (0.49)% 1.35% 0.37% 0.39%
-- -- -- -- -- --
51.45% 115.88% 128.56% 40.70% 52.02% 142.36%
$0.0367 $0.0196 n/a $ 0.0043 $0.0162 n/a
1.19% 1.27% 2.08% 1.35% 1.63% 2.25%
(0.20)% 0.73% (1.48)% 1.15% (0.12)% (0.71)%

<CAPTION>
JNL/ALGER GROWTH SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, OCTOBER 16,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
$11.16 $10.38 $10.00
-- -- --
1.87 0.78 0.38
------- ------- ------
1.87 0.78 0.38
------- ------- ------
-- -- --
-- -- --
-- -- --
------- ------- ------
-- -- --
------- ------- ------
1.87 0.78 0.38
------- ------- ------
$13.03 $11.16 $10.38
======= ======= ======
16.76% 7.51% 3.80%
$63,109 $38,252 $8,649
1.125% 1.07% 1.03%
(0.07)% (0.02)% (0.17)%
-- -- --
51.91% 59.92% 50.85%
$0.0720 $0.0441 n/a
1.15% 1.19% 1.89%
(0.09)% (0.14)% (1.03)%
</TABLE>

See notes to the financial statements.

7
<PAGE> 59

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

<TABLE>
<CAPTION>
JNL/EAGLE CORE JNL/EAGLE SMALLCAP
EQUITY SERIES EQUITY SERIES
---------------------------- ----------------------------
SIX MONTHS PERIOD FROM SIX MONTHS PERIOD FROM
ENDED SEPTEMBER 16, ENDED SEPTEMBER 16,
JUNE 30, 1996* TO JUNE 30, 1996* TO
1997 DECEMBER 31, 1997 DECEMBER 31,
(UNAUDITED) 1996 (UNAUDITED) 1996
----------- ------------- ----------- -------------
<S> <C> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD................... $10.62 $10.00 $11.54 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)........................... 0.04 0.03 (0.02) (0.01)
Net realized and unrealized gains on investments and
foreign currency related items....................... 1.95 0.62 1.97 1.55
------- ------- ------- -------
Total income from investment operations................ 1.99 0.65 1.95 1.54
------- ------- ------- -------
LESS DISTRIBUTIONS:
From net investment income............................. -- (0.03) -- --
From net realized gains on investment transactions..... -- -- -- --
Return of capital...................................... -- -- -- --
------- ------- ------- -------
Total distributions.................................... -- (0.03) -- --
------- ------- ------- -------
Net increase........................................... 1.99 0.62 1.95 1.54
------- ------- ------- -------
NET ASSET VALUE, END OF PERIOD......................... $12.61 $10.62 $13.49 $11.54
======= ======= ======= =======
TOTAL RETURN(A)........................................ 18.74% 6.47% 16.90% 15.40%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands)............... $ 6,783 $ 1,954 $ 6,983 $ 1,944
Ratio of net operating expenses to average net
assets(b)(c)(e)...................................... 1.05% 1.05% 1.10% 1.10%
Ratio of net investment income to average net
assets(b)(c)......................................... 1.14% 1.10% (0.62)% (0.26)%
Ratio of interest expense and dividends on short
positions to average net assets(b)................... -- -- -- --
Portfolio turnover..................................... 22.58% 1.36% 26.30% 28.01%
Average commission rate paid(d)........................ $0.0591 $0.0452 $0.0593 $0.0264
RATIO INFORMATION ASSUMING NO EXPENSE REIMBURSEMENT OR
FEES PAID INDIRECTLY
Ratio of expenses to average net assets(b)(f).......... 2.02% 4.57% 2.03% 4.77%
Ratio of net investment income to average net
assets(b)............................................ 0.17% (2.42)% (1.55)% (3.93)%
</TABLE>

See notes to the financial statements.

8
<PAGE> 60

<TABLE>
<CAPTION>
JNL/PUTNAM GROWTH SERIES JNL/PUTNAM VALUE EQUITY SERIES
----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
----------- ------------ ------------ ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
$14.21 $12.50 $10.00 $14.50 $12.77 $10.00
0.03 0.04 0.01 0.09 0.10 0.23
1.26 2.12 3.66 1.92 1.97 2.86
------- ------- ------ ------- ------- ------
1.29 2.16 3.67 2.01 2.07 3.09
------- ------- ------ ------- ------- ------
-- (0.05) -- -- (0.15) (0.17)
-- (0.40) (1.17) -- (0.19) (0.15)
-- -- -- -- -- --
------- ------- ------ ------- ------- ------
-- (0.45) (1.17) -- (0.34) (0.32)
------- ------- ------ ------- ------- ------
1.29 1.71 2.50 2.01 1.73 2.77
------- ------- ------ ------- ------- ------
$15.50 $14.21 $12.50 $16.51 $14.50 $12.77
======= ======= ====== ======= ======= ======
9.08% 17.28% 37.69% 13.86% 16.25% 31.14%
$60,325 $22,804 $2,518 $53,953 $17,761 $3,365
1.05% 1.04% 0.95% 0.97% 0.85% 0.87%
0.63% 0.94% 0.28% 2.02% 2.29% 2.33%
0.25% -- -- -- -- --
220.95% 184.33% 255.03% 92.65% 13.71% 30.12%
$0.0481 $0.0175% n/a $0.0370 $0.0259 n/a
1.10% 1.27% 5.38% 1.12% 1.53% 2.28%
0.58% 0.71% (4.15)% 1.87% 1.61% 0.91%
</TABLE>

9
<PAGE> 61

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

<TABLE>
<CAPTION>
PPM AMERICA/JNL BALANCED SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD........................ $11.92 $11.17 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)................................ 0.16 0.10 0.25
Net realized and unrealized gains on investments and foreign
currency related items.................................... 0.95 0.98 1.40
------- ------- ------
Total income from investment operations..................... 1.11 1.08 1.65
------- ------- ------
LESS DISTRIBUTIONS:
From net investment income.................................. -- (0.15) (0.19)
From net realized gains on investment transactions.......... -- (0.18) (0.29)
Return of capital........................................... -- -- --
------- ------- ------
Total distributions......................................... -- (0.33) (0.48)
------- ------- ------
Net increase................................................ 1.11 0.75 1.17
------- ------- ------
NET ASSET VALUE, END OF PERIOD.............................. $13.03 $11.92 $11.17
======= ======= ======
TOTAL RETURN(A)............................................. 9.31% 9.72% 16.60%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................... $42,495 $24,419 $4,761
Ratio of net operating expenses to average net
assets(b)(c)(e)........................................... 0.99% 1.04% 1.01%
Ratio of net investment income to average net
assets(b)(c).............................................. 3.28% 2.39% 2.99%
Ratio of interest expense and dividends on short positions
to average net assets(b).................................. -- -- --
Portfolio turnover.......................................... 121.49% 158.15% 115.84%
Average commission rate paid(d)............................. $0.0347 $0.0494 n/a
RATIO INFORMATION ASSUMING NO EXPENSE REIMBURSEMENT OR FEES
PAID INDIRECTLY
Ratio of expenses to average net assets(b)(f)............... 1.09% 1.22% 3.71%
Ratio of net investment income to average net assets(b)..... 3.18% 2.21% 0.29%
</TABLE>

- -------------------------
* Commencement of operations.
(a) Assumes investment at net asset value at the beginning of the period,
reinvestment of all distributions, and a complete redemption of the
investment at the net asset value at the end of the period. Total return is
not annualized.
(b) Annualized.
(c) Computed after giving effect to the Advisor's expense reimbursement and fees
paid indirectly.
(d) Disclosure required for fiscal years beginning after September 1, 1995.
(e) For the JNL/Putnam Growth Series during the six months ended June 30, 1997,
the net operating expense ratio excludes interest expense and dividends on
short positions. The ratio including interest expense and dividends on short
positions during the six months ended June 30, 1997 was 1.25%.
(f) For the JNL/Putnam Growth series during the six months ended June 30, 1997,
the expense ratio excludes interest expense and dividends on short
positions. The ratio including interest expense and dividends on short
positions during the six months ended June 30, 1997 was 1.30%.

See notes to the financial statements.

10
<PAGE> 62

<TABLE>
<CAPTION>
PPM AMERICA/ SALOMON BROTHERS/
JNL MONEY MARKET SERIES JNL GLOBAL BOND SERIES
- ----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
- ----------- ------------ ------------ ----------- ------------ ------------
<C> <C> <C> <C> <C> <C>
$1.00 $1.00 $1.00 $10.63 $10.46 $10.00
0.02 0.04 0.04 0.27 0.42 0.81
-- -- -- 0.31 0.70 0.24
------- ------- ------ ------- ------- ------
0.02 0.04 0.04 0.58 1.12 1.05
------- ------- ------ ------- ------- ------
(0.02) (0.04) (0.04) -- (0.69) (0.56)
-- -- -- -- (0.26) (0.03)
-- -- -- -- -- --
------- ------- ------ ------- ------- ------
(0.02) (0.04) (0.04) -- (0.95) (0.59)
------- ------- ------ ------- ------- ------
-- -- -- 0.58 0.17 0.46
------- ------- ------ ------- ------- ------
$1.00 $1.00 $1.00 $11.21 $10.63 $10.46
======= ======= ====== ======= ======= ======
2.41% 3.61% 4.59% 5.46% 10.68% 10.74%
$37,856 $23,752 $6,816 $26,366 $12,483 $6,380
0.75% 0.75% 0.75% 1.00% 0.99% 1.00%
4.85% 4.75% 5.06% 7.21% 7.52% 9.01%
-- -- -- -- -- --
-- -- -- 84.42% 109.85% 152.89%
n/a n/a n/a n/a n/a n/a
0.80% 0.85% 1.30% 1.36% 1.44% 2.14%
4.80% 4.65% 4.51% 6.85% 7.07% 7.87%
</TABLE>

11
<PAGE> 63

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

<TABLE>
<CAPTION>
SALOMON BROTHERS/JNL U.S.
GOVERNMENT & QUALITY BOND SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD........................ $10.20 $10.09 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)................................ 0.24 0.24 0.45
Net realized and unrealized gains on investments and foreign
currency related items.................................... -- 0.24 0.02
------- ------ ------
Total income from investment operations..................... 0.24 0.48 0.47
------- ------ ------
LESS DISTRIBUTIONS:
From net investment income.................................. -- (0.34) (0.34)
From net realized gains on investment transactions.......... -- (0.03) (0.04)
Return of capital........................................... -- -- --
------- ------ ------
Total distributions......................................... -- (0.37) (0.38)
------- ------ ------
Net increase................................................ 0.24 0.11 0.09
------- ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $10.44 $10.20 $10.09
======= ====== ======
TOTAL RETURN(A)............................................. 2.35% 4.82% 4.65%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................... $17,401 $9,832 $3,007
Ratio of net operating expenses to average net
assets(b)(c).............................................. 0.85% 0.84% 0.84%
Ratio of net investment income to average net
assets(b)(c).............................................. 6.11% 5.72% 5.41%
Ratio of interest expense and dividends on short positions
to average net assets(b).................................. -- -- --
Portfolio turnover.......................................... 152.20% 218.50% 253.37%
Average commission rate paid(d)............................. n/a n/a n/a
RATIO INFORMATION ASSUMING NO EXPENSE REIMBURSEMENT OR FEES
PAID INDIRECTLY
Ratio of expenses to average net
assets(b)................................................. 1.09% 1.37% 2.53%
Ratio of net investment income to average net assets(b)..... 5.87% 5.19% 3.72%
</TABLE>

See notes to the financial statements.

12
<PAGE> 64

<TABLE>
<CAPTION>
T. ROWE PRICE/JNL T. ROWE PRICE/JNL INTERNATIONAL T. ROWE PRICE/JNL
ESTABLISHED GROWTH SERIES EQUITY INVESTMENT SERIES MID-CAP GROWTH SERIES
----------------------------------------- ----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
----------- ------------ ------------ ----------- ------------ ------------ ----------- ------------ ------------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
$12.56 $11.36 $10.00 $12.08 $11.25 $10.00 $14.89 $13.43 $10.00
0.03 0.03 0.07 0.08 0.06 0.04 (0.01) (0.05) 0.06
2.18 1.81 2.68 1.32 0.90 1.21 0.92 1.92 3.90
------- ------- ------ ------- ------- ------- ------- ------- -------
2.21 1.84 2.75 1.40 0.96 1.25 0.91 1.87 3.96
------- ------- ------ ------- ------- ------- ------- ------- -------
-- (0.04) (0.06) -- (0.12) -- -- (0.05) --
-- (0.09) (1.33) -- (0.01) -- -- (0.36) (0.53)
-- (0.51) -- -- -- -- -- -- --
------- ------- ------ ------- ------- ------- ------- ------- -------
-- (0.64) (1.39) -- (0.13) -- -- (0.41) (0.53)
------- ------- ------ ------- ------- ------- ------- ------- -------
2.21 1.20 1.36 1.40 0.83 1.25 0.91 1.46 3.43
------- ------- ------ ------- ------- ------- ------- ------- -------
$14.77 $12.56 $11.36 $13.48 $12.08 $11.25 $15.80 $14.89 $13.43
======= ======= ====== ======= ======= ======= ======= ======= =======
17.60% 16.12% 28.23% 11.59% 8.54% 12.50% 6.11% 13.91% 40.06%
$80,998 $32,291 $8,772 $74,486 $48,204 $24,211 $91,573 $47,104 $10,545
1.00% 1.00% 1.00% 1.24% 1.25% 1.25% 1.10% 1.10% 1.10%
0.60% 0.59% 0.75% 1.59% 1.09% 0.78% (0.21)% (0.81)% 0.82%
-- -- -- -- -- -- -- -- --
36.76% 36.41% 101.13% 7.86% 5.93% 16.45% 22.65% 25.05% 66.04%
$0.0349 $0.0288 n/a $0.0018 $0.0257 n/a $0.0487 $0.0326 n/a
1.04% 1.11% 1.11% 1.38% 1.29% 2.14% 1.12% 1.14% 2.10%
0.56% 0.48% 0.48% 1.45% 1.05% (0.11)% (0.23)% (0.22)% (0.18)%
</TABLE>

13
<PAGE> 65

Jackson National Financial Services, Inc. ("JNFSI"), a wholly owned
subsidiary of Jackson National Life Insurance Company, serves as investment
adviser for all the Series of the Trust. Janus Capital Corporation serves as
sub-adviser for the JNL Capital Growth, JNL Aggressive Growth and JNL Global
Equities Series; Fred Alger Management, Inc. serves as sub-adviser for the
JNL/Alger Growth Series; Eagle Asset Management, Inc. serves as sub-adviser for
the JNL/Eagle Core Equity Series and JNL/Eagle SmallCap Equity Series; Putnam
Investment Management, Inc. serves as sub-adviser for the JNL/Putnam Growth and
JNL/Putnam Value Equity Series; PPM America, Inc. serves as sub-adviser for the
PPM America/JNL Balanced and PPM America/JNL Money Market Series; Salomon
Brothers Asset Management Inc serves as sub-adviser for the Salomon Brothers/JNL
Global Bond and Salomon Brothers/JNL U.S. Government & Quality Bond Series; T.
Rowe Price Associates, Inc. serves as sub-adviser for the T. Rowe Price/JNL
Established Growth and T. Rowe Price/JNL Mid-Cap Growth Series; and Rowe
Price-Fleming International, Inc. serves as sub-adviser for the T. Rowe
Price/JNL International Equity Investment Series.

DIVERSIFICATION

14
<PAGE> 66

securities of any issuer; however, only 50% of total assets are subject to the
5% test. The JNL Capital Growth and JNL Aggressive Growth Series may invest up
to 50% of total assets in the securities of as few as two issuers (not to exceed
25% in any one issuer) while the other Series may invest up to 25% of their
total assets in the securities of one issuer. Neither the JNL Capital Growth nor
the JNL Aggressive Growth Series anticipates concentrating its holdings in so
few issuers unless its sub-adviser believes a security has the potential for
substantial capital appreciation consistent with a Series' investment policies
and goals. To the extent that any Series invests more than 5% of its assets in a
particular issuer, its exposure to credit risks and/or market risks associated
with that issuer increases. As an additional fundamental policy, no Series will
invest more than 25% of its total assets in any particular industry (other than
U.S. Government securities), except that the PPM America/JNL Money Market Series
may invest a greater percent of its assets in the domestic banking industry.

INTERNAL REVENUE SERVICE (IRS) LIMITATIONS

- --------------------------------------------------------------------------------
JNL AGGRESSIVE GROWTH SERIES
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
JNL CAPITAL GROWTH SERIES
- --------------------------------------------------------------------------------

15
<PAGE> 67

- --------------------------------------------------------------------------------
JNL GLOBAL EQUITIES SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL Global Equities Series is long-term
growth of capital in a manner consistent with the preservation of capital. It is
a diversified Series that pursues its investment objective primarily through
investments in common stocks of foreign and domestic issuers. The Series is
permitted to invest on a worldwide basis in companies and other organizations of
any size, regardless of country of organization or place of principal business
activity, as well as domestic and foreign governments, government agencies and
other governmental entities. The Series normally invests in securities of
issuers from at least five different countries, including the United States,
although the Series may at times invest all of its assets in fewer than five
countries. The JNL Global Equities Series may not be suitable for investors that
are not able to bear the additional risks associated with the Series' more
extensive holdings of foreign securities.

16
<PAGE> 68

17
<PAGE> 69

Investment in special situations may carry an additional risk of loss in the
event that the anticipated development does not occur or does not attract the
expected attention. The impact of this strategy on a Series will depend on the
Series' size and the extent of its holdings of special situation issuers
relative to total net assets.

- --------------------------------------------------------------------------------
JNL/ALGER GROWTH SERIES
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
JNL/EAGLE CORE EQUITY SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL/Eagle Core Equity Series is long-term
capital appreciation and, secondarily, current income. It is a diversified
Series that seeks to achieve its objective by investing in common stocks that
the sub-adviser believes meet the criteria for one of three individual equity
strategies. The investment strategies which the sub-adviser utilizes to pursue
the Series' objective are the growth equity strategy, the value equity strategy
and the equity income strategy. In pursuing the growth equity strategy, the
sub-adviser will invest in securities which it believes have sufficient growth
potential to offer above-average long-term capital appreciation. Securities
which meet the criteria for the growth equity strategy will have at least one of
the following characteristics:

- expected earnings-per-share growth greater than the average of the S&P
500 Composite Stock Price Index ("S&P 500"); or

- return on equity greater than the average of the S&P 500.

In pursuing the value equity strategy, the sub-adviser will invest in
securities which it believes indicate above-average financial soundness and high
intrinsic value relative to price. Securities which meet the criteria for the
value equity strategy will have at least

18
<PAGE> 70

one of the following characteristics at the time of purchase:

- price-to-earnings ratio or price-to-book value ratio of less than or
approximately equal to 75% of that of the broader equity market (as
measured by the S&P 500); or

- yield that approximates at least 50% of the prevailing average yield to
maturity of the long-term U.S. Government bond, as measured by the Lehman
Brothers Long Treasury Bond Index (or other similar index if this index
is not available); or

- per share going concern value (as estimated by the sub-adviser) that
exceeds book value and market value; or

- long-term debt below, or approximately equivalent to, tangible net worth.

In pursuing the equity income strategy, the sub-adviser will invest in
income-producing securities.

Under normal market conditions, at least 65% of the Series' total assets
will be invested in U.S. common stocks. With respect to the other 35% of its
total assets, the Series may invest in income-producing securities that the
sub-adviser believes are consistent with the Series' investment objective,
common stocks of foreign issuers, American Depositary Receipts, foreign currency
transactions with respect to underlying common stock, preferred stock,
convertible securities, corporate debt obligations, obligations of the U.S.
Government, its agencies and instrumentalities, repurchase agreements, money
market instruments, real estate investment trusts, futures contracts, options,
rights or warrants to subscribe for or purchase common stocks, and securities
that track the performance of a broad-based securities index, such as S&P
Depository Receipts. The Series may also loan its portfolio securities and
engage in short sales "against the box."

The Series will emphasize investments in securities rated investment grade
and unrated securities deemed by the sub-adviser to be of comparable quality,
but may invest up to 35% of its assets in securities rated below investment
grade and unrated securities deemed by the sub-adviser to be of comparable
quality. The Series, at the discretion of the sub-adviser, may retain a security
that has been downgraded below the initial investment criteria. (See "Investment
Risks -- High Yield/High Risk Bonds"). The Series may invest up to 25% of its
total assets in securities of foreign issuers, including American Depositary
Receipts. (See "Investment Risks -- Foreign Securities").

For temporary defensive purposes during anticipated periods of general
market decline, the Series may invest up to 100% of its assets in money market
instruments, including securities issued or guaranteed by the U.S. Government,
its agencies or instrumentalities and repurchase agreements secured thereby,
bank certificates of deposit and banker's acceptances issued by banks having net
assets of at least $1 billion as of the end of their most recent fiscal year,
high grade commercial paper, and other long- and short-term debt instruments
that are rated A or higher by Moody's or S&P. It is impossible to predict when,
or for how long, such alternative strategies may be utilized.

In selecting common stocks to pursue the growth equity strategy, the
sub-adviser makes selections in part based on its opinion regarding the
sustainability of the company's competitive advantage in the marketplace as well
as the sub-adviser's opinion of the company's management team. The sub-adviser
will invest in companies that, in its opinion, will have long-term returns
greater than the average for the S&P 500. The sub-adviser normally will
reevaluate a security if it underperforms the S&P 500 by 15% or more during a
three-month period. At that time, a decision will be made to sell or hold the
security. If a particular stock appreciates to over 5% of the total assets of
the portfolio, the sub-adviser generally will reduce the position to less than
5%. If the stock price appreciates to a level that is not sustainable in the
opinion of the sub-adviser, the position generally will be sold to realize the
existing profits and avoid a potential price correction. If the sub-adviser
identifies a security that it considers to be a better investment than a current
holding, the sub-adviser generally will consider selling the current holding to
add the new security.

In selecting common stocks to pursue the value equity strategy, the
sub-adviser screens a universe of over 2500 companies. From this universe, the

19
<PAGE> 71

sub-adviser anticipates that only a few hundred companies will meet one or more
of these investment criteria. Each of the companies is analyzed individually in
terms of its past and present competitive position within its perspective
industry. The sub-adviser makes selections based on its projections of the
companies' growth in earnings and dividends, earnings momentum, and
undervaluation based on a dividend discount model. The sub-adviser develops
target prices and value ranges from this analysis and makes portfolio selection
from among the top-rated securities. The sub-adviser periodically monitors the
Series' holdings of securities meeting these criteria to assure that they
continue to meet the selection criteria. A security normally will be sold once
it reaches its target price, when negative changes occur with respect to the
company or its industry, or when there is a significant change in the security
with respect to one or more of the four selection criteria listed above. The
Series may at times continue to hold equity securities that no longer meet the
criteria but that the sub-adviser deems suitable investments in view of the
Series' investment objective.

- --------------------------------------------------------------------------------
JNL/EAGLE SMALLCAP EQUITY SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL/Eagle SmallCap Equity Series is
long-term capital appreciation. It is a diversified Series that seeks to achieve
its objective by investing primarily in the equity securities of companies, most
of which have a total market capitalization of less than $1 billion ("small
capitalization companies"). Market capitalization is the total value of a
company's outstanding common stock. The Series will invest in securities of
companies that appear to the sub-adviser to be undervalued in relation to their
long-term earning power or the asset value of their issuers and that have
significant future growth potential. Securities may be undervalued because of
many factors, including market decline, poor economic conditions, tax-loss
selling or actual or anticipated unfavorable developments affecting the issuer
of the security. Any or all of these factors may provide buying opportunities at
attractive prices relative to the long-term prospects for the companies in
question.

The Series invests primarily in common stocks, but also may invest in
preferred stocks, investment grade securities convertible into common stocks,
and warrants. The Series may purchase securities traded on recognized securities
exchanges and in the over-the-counter market. The Series normally invests at
least 65% of its total assets in the equity securities of companies each of
which, at the time of purchase, has a total market capitalization of less than
$1 billion. The Series may invest its remaining assets in American Depositary
Receipts, U.S. Government securities, repurchase agreements or other short-term
money market instruments.

The Series will emphasize investments in securities rated investment grade
and unrated securities deemed by the sub-adviser to be of comparable quality,
but may invest up to 5% of its assets in securities rated below investment grade
and unrated securities deemed by the sub-adviser to be of comparable quality.
The Series, at the discretion of the sub-adviser, may retain a security that has
been downgraded below the initial investment criteria. (See "Investment Risks --
High Yield/High Risk Bonds").

The sub-adviser currently believes that investments in small capitalization
companies may offer greater opportunities for growth of capital than investments
in larger, more established companies. Investing in smaller, newer issuers
generally involves greater risks than investing in larger, more established
issuers. Companies in which the Series is likely to invest may have limited
product lines, markets or financial resources and may be subject to more abrupt
or erratic market movements than securities of larger, more established
companies or the market averages in general. In addition, many small
capitalization companies may be in the early stages of development. Accordingly,
an investment in the Series may not be appropriate for all investors.

For temporary defensive purposes during anticipated periods of general
market decline, the Series may invest up to 100% of its assets in money market

20
<PAGE> 72

instruments, including securities issued or guaranteed by the U.S. Government,
its agencies or instrumentalities and repurchase agreements secured thereby, as
well as bank certificates of deposit and banker's acceptances issued by banks
having net assets of at least $1 billion as of the end of their most recent
fiscal year, high-grade commercial paper, and other long- and short-term debt
instruments that are rated A or higher by Moody's or S&P. It is impossible to
predict when, or for how long, such alternative strategies may be utilized.

- --------------------------------------------------------------------------------
JNL/PUTNAM GROWTH SERIES
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
JNL/PUTNAM VALUE EQUITY SERIES
- --------------------------------------------------------------------------------

21
<PAGE> 73

common stock characteristics, such as rights and warrants to purchase common
stocks. Under normal circumstances, the Series will invest at least 65% of the
value of its total assets in equity securities.

- --------------------------------------------------------------------------------
PPM AMERICA/JNL BALANCED SERIES
- --------------------------------------------------------------------------------

22
<PAGE> 74

This Series will invest exclusively in the following types of high quality,
U.S. dollar denominated money market instruments that mature in 397 days or
less:

- Obligations issued or guaranteed as to principal and interest by the U.S.
Government, its agencies and instrumentalities.

- Corporate obligations, including commercial paper, of domestic and
foreign issuers.

- Obligations issued or guaranteed by one or more foreign governments or
any of their political subdivisions, agencies or instrumentalities,
including obligations of supranational entities.

- Repurchase agreements on obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.

23
<PAGE> 75

24
<PAGE> 76

likely to lead to a weakened capacity to make principal and interest payments
than is the case with higher grade debt securities.

25
<PAGE> 77

mechanism for debtor nations to restructure their outstanding external
indebtedness. (See "Investment Risks -- High Yield/ High Risk Bonds"). The
sub-adviser anticipates that the Series' initial investments in sovereign debt
will be concentrated in Latin American countries, including Mexico and Central
and South American and Caribbean countries. The sub-adviser expects to take
advantage of additional opportunities for investment in the debt of North
African countries, such as Nigeria and Morocco, Eastern European countries, such
as Poland and Hungary, and Southeast Asian countries, such as the Philippines.
Sovereign governments may include national, provincial, state, municipal or
other foreign governments with taxing authority. Governmental entities may
include the agencies and instrumentalities of such governments, as well as
state-owned enterprises. (For a more detailed discussion of high yield sovereign
debt securities, see "Investment Risks -- High Yield/ High Risk Bonds").

26
<PAGE> 78

At least 65% of the total assets of the Series will be invested in:

(1) U.S. Treasury obligations;

27
<PAGE> 79

28
<PAGE> 80

paying dividends and are generally expected to increase the amounts of such
dividends in future years as earnings increase. Although the Series will invest
primarily in U.S. common stocks, it may also purchase other types of securities,
for example, convertible securities, warrants, hybrid instruments, restricted
securities, futures and options, when considered consistent with the Series'
investment objective and program. The Series may invest up to 30% of its total
assets (excluding reserves) in foreign securities, including American Depositary
Receipts.

Over the last 30 years, many foreign economies have grown faster than the
United States' economy, and the return from equity investments in these
countries has often exceeded the return on similar investments in the United
States. Moreover, there has normally been a wide and largely unrelated variation
in performance between international equity markets over this period. Although
there can be no assurance that these conditions will continue, the Series'
sub-adviser, within the framework of diversification, seeks to identify and
invest in companies participating in the faster growing foreign economies and
markets. The sub-adviser believes that investment in foreign securities offers
significant potential for long-term capital appreciation and an opportunity to
achieve investment diversification. The Series may also purchase other types of
securities, for example, common and preferred stocks, convertible securities,
fixed income securities, hybrid instruments, restricted securities, foreign
currency transactions, futures and options.

29
<PAGE> 81

30
<PAGE> 82

SECURITIES AND MANAGEMENT PRACTICES

FIXED INCOME SECURITIES. A Series may invest in fixed income securities of
companies which meet the investment criteria for the Series. The price of fixed
income securities fluctuates with changes in interest rates, generally rising
when interest rates fall and falling when interest rates rise. Prices of
longer-term securities generally increase or decrease more sharply than those of
shorter-term securities in response to interest rate changes.

31
<PAGE> 83

32
<PAGE> 84

not rated by an established rating service, determined on a dollar weighted
average, were:

<TABLE>
<CAPTION>
PERCENTAGE OF
NET ASSETS
-----------------
SALOMON BROTHERS/
JNL GLOBAL
S&P RATING BOND SERIES
---------- -----------------
<S> <C>
AAA............................ 28.05%
AA............................. 1.78%
A.............................. 0.45%
BBB............................ 4.09%
BB............................. 6.83%
B.............................. 29.51%
CCC............................ 2.84%
CC............................. 0%
C.............................. 0%
D.............................. 0%
Not Rated...................... 26.45%
</TABLE>

33
<PAGE> 85

for bankruptcy or becomes insolvent, the Series' use of proceeds of the dollar
roll may be restricted pending a determination by the other party, or its
trustee or receiver, whether to enforce the Series' obligation to repurchase the
securities.

When a Series invests in a reverse repurchase agreement, it sells a
portfolio security to another party, such as a bank or a broker-dealer, in
return for cash, and agrees to buy the security back at a future date and price.
Reverse repurchase agreements may be used to provide cash to satisfy unusually
heavy redemption requests or for other temporary or emergency purposes without
the necessity of selling portfolio securities or to earn additional income on
portfolio securities, such as Treasury bills and notes.

34
<PAGE> 86

PARTICIPATIONS AND ASSIGNMENTS

A Series may invest in fixed and floating rate loans ("Loans") arranged
through private negotiations between a corporate borrower or a foreign sovereign
entity and one or more financial institutions ("Lenders"). A Series may invest
in such Loans in the form of participations in Loans ("Participations") and
assignments of

35
<PAGE> 87

all or a portion of Loans from third parties ("Assignments"). Participations
typically will result in a Series having a contractual relationship only with
the Lender, not with the borrower. A Series will have the right to receive
payments of principal, interest and any fees to which it is entitled only from
the Lender selling the Participation and only upon receipt by the Lender of the
payments from the borrower. In connection with purchasing Participations, a
Series generally will have no right to enforce compliance by the borrower with
the terms of the loan agreement relating to the Loan, nor any rights of set-off
against the borrower, and a Series may not benefit directly from any collateral
supporting the Loan in which it has purchased the Participation. As a result, a
Series will assume the credit risk of both the borrower and the Lender that is
selling the Participation. In the event of the insolvency of the Lender selling
a Participation, a Series may be treated as a general creditor of the Lender and
may not benefit from any set-off between the Lender and the borrower. A Series
will acquire Participations only if the Lender interpositioned between a Series
and the borrower is determined by the sub-adviser to be creditworthy. When a
Series purchases Assignments from Lenders, a Series will acquire direct rights
against the borrower on the Loan, except that under certain circumstances such
rights may be more limited than those held by the assigning Lender.

INVESTMENT RISKS

FOREIGN SECURITIES

36
<PAGE> 88

Depositary Receipts do not involve the same direct currency and liquidity risks
as foreign securities.

EMERGING MARKETS

FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS

The use of futures, options, forward contracts, and swaps ("derivative
instruments") exposes a Series to additional investment risks and transaction
costs. If a sub-adviser seeks to protect a Series against potential adverse
movements in the securities, foreign currency

37
<PAGE> 89

or interest rate markets using these instruments, and such markets do not move
in a direction adverse to the Series, that Series could be left in a less
favorable position than if such strategies had not been used. Risks inherent in
the use of futures, options, forward contracts and swaps include (1) the risk
that interest rates, securities prices and currency markets will not move in the
directions anticipated; (2) imperfect correlation between the price of
derivative instruments and movements in the prices of the securities, interest
rates or currencies being hedged; (3) the fact that skills needed to use these
strategies are different from those needed to select portfolio securities; (4)
the possible absence of a liquid secondary market for any particular instrument
at any time; and (5) the possible need to defer closing out certain hedged
positions to avoid adverse tax consequences.

HIGH YIELD/HIGH RISK BONDS

HIGH YIELD FOREIGN SOVEREIGN DEBT SECURITIES

38
<PAGE> 90

Additional factors which may influence the ability or willingness to service
debt include, but are not limited to, a country's cash flow situation, the
availability of sufficient foreign exchange on the date a payment is due, the
relative size of its debt service burden to the economy as a whole, and its
government's policy towards the International Monetary Fund, the World Bank and
other international agencies.

HYBRID INSTRUMENTS

MUNICIPAL OBLIGATIONS

WHEN-ISSUED SECURITIES

39
<PAGE> 91

- --------------------------------------------------------------------------------
MANAGEMENT OF THE TRUST
- --------------------------------------------------------------------------------

INVESTMENT ADVISER

Under Massachusetts law and the Trust's Declaration of Trust and By-Laws,
the management of the business and affairs of the Trust is the responsibility of
the Trustees.

40
<PAGE> 92

<TABLE>
<CAPTION>
(M -- MILLION) $ 0 TO $50 M TO $100 M TO $150 M TO $200 M TO $250 M TO $300 M TO $350 M TO OVER
$50 M $100 M $150 M $200 M $250 M $300 M $350 M $500 M $500 M
% % % % % % % % %
SERIES ------ -------- --------- --------- --------- --------- --------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
JNL Aggressive Growth..... .95 .95 .95 .90 .90 .90 .85 .85 .85
JNL Capital Growth........ .95 .95 .95 .90 .90 .90 .85 .85 .85
JNL Global Equities....... 1.00 1.00 1.00 .95 .95 .95 .90 .90 .90
JNL/Alger Growth.......... .975 .975 .975 .975 .975 .975 .95 .95 .90
JNL/Eagle Core Equity..... .90 .85 .85 .85 .85 .85 .75 .75 .75
JNL/Eagle SmallCap
Equity.................. .95 .95 .95 .90 .90 .90 .90 .90 .85
JNL/Putnam Growth*........ .90 .90 .90 .85 .85 .85 .80 .80 .80
JNL/Putnam Value
Equity**................ .90 .90 .90 .85 .85 .85 .80 .80 .80
PPM America/JNL
Balanced***............. .75 .70 .70 .675 .675 .675 .65 .65 .625
PPM/America JNL Money
Market.................. .60 .60 .60 .575 .575 .575 .55 .55 .525
Salomon Brothers/JNL
Global Bond............. .85 .85 .85 .80 .80 .80 .80 .80 .75
Salomon Brothers/JNL U.S.
Government & Quality
Bond.................... .70 .70 .70 .65 .65 .65 .60 .60 .55
T. Rowe Price/JNL
Established Growth...... .85 .85 .85 .80 .80 .80 .80 .80 .80
T. Rowe Price/JNL
International Equity
Investment.............. 1.10 1.05 1.05 1.00 1.00 1.00 .95 .95 .90
T. Rowe Price/JNL Mid-Cap
Growth.................. .95 .95 .95 .90 .90 .90 .90 .90 .90
</TABLE>

- -------------------------
* Prior to May 1, 1997, the fee for the JNL/Putnam Growth Series was .90%,
.85%, .80%, .75%, and .70%, respectively.

** Prior to May 1, 1997, the fee for the JNL/Putnam Value Equity Series was
.75%, .70%, .675%, .65% and .625%, respectively.

*** Prior to May 1, 1997, the fee for the PPM America/JNL Balanced Series was
.90%, .80%, .75%, .70% and .65%, respectively.

41
<PAGE> 93

INVESTMENT SUB-ADVISERS

Eagle Asset Management, Inc. ("Eagle"), 880 Carillion Parkway, St.
Petersburg, Florida 33716, serves as sub-adviser to the JNL/Eagle Core Equity
Series and the JNL/Eagle SmallCap Equity Series. Eagle is a wholly-owned
subsidiary of Raymond James Financial, Inc., which, together with its
subsidiaries, provides a wide range of financial services to retail and
institutional clients. Eagle manages client accounts with net assets totaling
approximately $2.7 billion as of December 31, 1996.

PPM America, Inc. ("PPM"), which is located at 225 West Wacker Drive,
Chicago, Illinois 60606, serves as sub-adviser to the PPM America/JNL Balanced
Series* and the PPM America/JNL Money Market Series. PPM, an affiliate of JNFSI,
is a wholly owned subsidiary of Prudential Portfolio Managers Ltd., ("PPM Ltd.")
an investment management company engaged in global money management, which is in
turn wholly owned by Prudential Corporation plc. PPM Ltd. and its subsidiaries
manage over $120 billion in various currencies and markets. PPM currently
manages over $26 billion of Jackson National Life Insurance Company assets.
Additionally, PPM manages assets of over $5.7 billion for other affiliated
companies and over $878 million for non-affiliated entities.

Rowe Price-Fleming International, Inc. ("Price-Fleming"), located at 100
East Pratt Street, Baltimore,

- ---------------

42
<PAGE> 94

Maryland 21202, serves as sub-adviser to the T. Rowe Price/JNL International
Equity Investment Series. Price-Fleming was founded in 1979 as a joint venture
between T. Rowe Price Associates, Inc. and Robert Fleming Holdings Limited.
Price-Fleming is one of America's largest international mutual fund asset
managers with approximately $18 billion under management in its offices in
Baltimore, London, Tokyo, Hong Kong and Singapore.

Salomon Brothers Asset Management Inc ('SBAM") serves as sub-adviser to the
Salomon Brothers/JNL Global Bond Series and the Salomon Brothers/JNL U.S.
Government & Quality Bond Series. SBAM is an indirect, wholly owned subsidiary
of Salomon Brothers Holding Company Inc. which is, in turn, wholly owned by
Salomon Inc. ("SI"). SBAM was incorporated in 1987, and, together with
affiliates in London, Frankfurt, Tokyo and Hong Kong, SBAM provides a broad
range of fixed income and equity investment advisory services to various
individual and institutional clients located throughout the world and serves as
sub-advisor to various investment companies. In providing such investment
advisory services, SBAM has access to SI's more than 400 economists, mortgage
bond, sovereign and equity analysts. As of December 31, 1996, SBAM and its
worldwide investment affiliates managed approximately $17.8 billion. SBAM's
business offices are located at 7 World Trade Center, New York, New York 10048.

PORTFOLIO MANAGEMENT

The following individuals are primarily responsible for the day-to-day
management of the particular Series as indicated below.

JNL GLOBAL EQUITIES SERIES

43
<PAGE> 95

JNL CAPITAL GROWTH SERIES

JNL AGGRESSIVE GROWTH SERIES

JNL/ALGER GROWTH SERIES

JNL/EAGLE CORE EQUITY SERIES

In its capacity as sub-adviser, Eagle supervises and manages the investment
portfolio of the JNL/Eagle Core Equity Series. Eagle utilizes a team of senior
portfolio managers acting together to manage the assets of the Series. The team
meets regularly to review portfolio holdings and to discuss purchase and sale
activity. The team adjusts holdings in the portfolio as it deems appropriate in
the pursuit of the Series' investment objective.

JNL/EAGLE SMALLCAP EQUITY SERIES

Bert L. Boksen, Senior Vice President and Portfolio Manager of Eagle, is
responsible for the day-to-day management of the JNL/Eagle SmallCap Equity
Series. Mr. Boksen joined Eagle in April 1995 and has portfolio management
responsibilities for its small cap equity accounts. Prior to joining Eagle, Mr.
Boksen was employed for 16 years by Raymond James & Associates, Inc. in its
institutional research and sales department. While employed by Raymond James &
Associates, Inc., Mr. Boksen served as co-head of Research, Chief Investment
Officer and Chairman of the Raymond James & Associates, Inc. Focus List
Committee.

JNL/PUTNAM GROWTH SERIES

JNL/PUTNAM VALUE EQUITY SERIES

PPM AMERICA/JNL BALANCED SERIES

PPM AMERICA/JNL MONEY MARKET SERIES

In its capacity as sub-adviser, PPM supervises and manages the investment
portfolios of the PPM America/JNL Balanced Series and the PPM America/ JNL Money
Market Series and directs the purchase and sale of each Series' investment
securities. PPM utilizes teams of investment professionals acting together to
manage the assets of the Series. The teams meet regularly to review portfolio
holdings and to

44
<PAGE> 96

discuss purchase and sale activity. The teams adjust holdings in the portfolios
as they deem appropriate in the pursuit of the Series' investment objectives.
PPM has supervised and managed the investment portfolio of the PPM America/JNL
Balanced Series since May 1, 1997, and has supervised and managed the investment
portfolio of the PPM America/JNL Money Market Series since the commencement of
operations of the Series.

SALOMON BROTHERS/JNL GLOBAL BOND SERIES

SALOMON BROTHERS/JNL U.S. GOVERNMENT & QUALITY BOND SERIES

Mr. Lavan joined SBAM in 1990 and is a Portfolio Manager and Quantitative
Fixed Income Analyst, responsible for working for senior portfolio managers to
monitor and analyze market relationships and identify and implement relative
value transactions in SBAM's investment company and institutional portfolios
which invest in mortgage-backed securities and U.S. Government securities. Prior
to joining SBAM, Mr. Lavan spent four years analyzing portfolios for Salomon
Brothers Inc's Fixed Income Sales Group and Product Support Divisions.

T. ROWE PRICE/JNL ESTABLISHED GROWTH SERIES

45
<PAGE> 97

Mr. Smith was employed as an Investment Analyst for Massachusetts Financial
Services. He earned a BS (finance and economics) from the University of Delaware
and an MBA (finance) from the Darden Graduate School of Business Administration,
University of Virginia. Mr. Smith has had responsibility for the day-to-day
management of the T. Rowe Price/JNL Established Growth Series since February 21,
1997.

T. ROWE PRICE/JNL INTERNATIONAL EQUITY INVESTMENT SERIES

T. ROWE PRICE/JNL MID-CAP GROWTH SERIES

SUB-ADVISORY ARRANGEMENTS

46
<PAGE> 98

<TABLE>
<CAPTION>
(M -- MILLION) $0 TO $50 M TO $100 M TO $150 M TO $200 M TO $250 M TO $300 M TO $350 M TO OVER
$50 M $100 M $150 M $200 M $250 M $300 M $350 M $500 M $500 M
% % % % % % % % %
SERIES ----- -------- --------- --------- --------- --------- --------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
JNL Aggressive Growth.... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL Capital Growth....... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL Global Equities...... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL/Alger Growth......... .55 .55 .55 .55 .55 .55 .50 .50 .45
JNL/Eagle Core Equity.... .45 .40 .40 .40 .40 .40 .30 .30 .30
JNL/Eagle SmallCap
Equity................. .50 .50 .50 .45 .45 .45 .45 .45 .40
JNL/Putnam Growth*....... .50 .50 .50 .45 .45 .45 .35 .35 .35
JNL/Putnam Value
Equity**............... .50 .50 .50 .45 .45 .45 .35 .35 .35
PPM America/JNL
Balanced*.............. .25 .20 .20 .175 .175 .175 .15 .15 .125
PPM America/JNL Money
Market................. .20 .15 .15 .125 .125 .125 .10 .10 .075
Salomon Brothers/JNL
Global Bond............ .375 .35 .35 .30 .30 .30 .30 .30 .25
Salomon Brothers/JNL U.S.
Government & Quality
Bond................... .225 .225 .225 .175 .175 .175 .15 .15 .10
</TABLE>

*** When average net assets exceed this amount, the sub-advisory fee asterisked
is applicable to all amounts in this Series.

47
<PAGE> 99

OTHER TRUST EXPENSES

48
<PAGE> 100

- --------------------------------------------------------------------------------
INVESTMENT IN TRUST SHARES
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
SHARE REDEMPTION
- --------------------------------------------------------------------------------

The Trust may suspend the right of redemption only under the following
unusual circumstances:

- when the New York Stock Exchange is closed (other than weekends and
holidays) or trading is restricted;

- when an emergency exists, making disposal of portfolio securities or the
valuation of net assets not reasonably practicable; or

- during any period when the SEC has by order permitted a suspension of
redemption for the protection of shareholders.

- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------

49
<PAGE> 101

effective manner. Portfolio security transactions may be executed through
brokers who are affiliated with the Trust, JNFSI or a sub-adviser. In addition,
brokers may be selected taking into account such brokers' assistance in the
purchase of variable annuity contracts funded by the Trust (although such
assistance or absence thereof is neither a qualifying nor a disqualifying factor
in such selection). See the Statement of Additional Information for more
detailed information.

50
<PAGE> 102

From time to time, a Series also may quote information from publications
including, but not limited to, the following: Morningstar, Inc., The Wall Street
Journal, Money Magazine, Forbes, Barron's, The New York Times, USA Today,
Institutional Investor and Registered Representative. Also, investors may want
to compare the historical returns of various investments, performance indices of
those investments or economic indicators, including but not limited to stocks,
bonds, certificates of deposit and other bank products, money market funds and
U.S. Treasury obligations. Certain of these alternative investments may offer
fixed rates of return and guaranteed principal, and may be insured. Economic
indicators may include, without limitation, indicators of market rate trends and
cost of funds, such as Federal Home Loan Bank Board 11th District Cost of Funds
Index (COFI).

SHAREHOLDER INQUIRIES -- All inquiries regarding the Trust should be
directed to the Trust at the telephone number or address shown on the cover page
of this Prospectus.

51
<PAGE> 103

- --------------------------------------------------------------------------------
TAX STATUS
- --------------------------------------------------------------------------------

52
<PAGE> 104

CUSTODIAN

State Street Bank and Trust Company
1776 Heritage Drive
North Quincy, Massachusetts 02171

INDEPENDENT ACCOUNTANTS

Price Waterhouse LLP
100 East Wisconsin Avenue
Milwaukee, Wisconsin 53202

LEGAL COUNSEL

Blazzard, Grodd & Hasenauer, P.C.
943 Post Road East
Westport, CT 06880

INVESTMENT ADVISER AND TRANSFER AGENT

Jackson National Financial Services, Inc.
5901 Executive Drive
Lansing, Michigan 48911

53
<PAGE> 105

(This page intentionally left blank)
<PAGE> 106

COMMERCIAL PAPER RATINGS

A-1, A-2 AND PRIME-1, PRIME-2 COMMERCIAL PAPER RATINGS

CORPORATE BONDS

STANDARD & POOR'S RATINGS GROUP BOND RATINGS

AAA. Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA. Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher rated issued only in small degree.

CI. The rating CI is reserved for income bonds on which no interest is
being paid.

D. Debt rated D is in default, and payment of interest and/or repayment of
principal is in arrears.

A-1
<PAGE> 107

MOODY'S INVESTORS SERVICE, INC. BOND RATINGS

Such bonds lack outstanding investment characteristics and, in fact, have
speculative characteristics as well.

CAA. Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal and
interest.

CA. Bonds which are rated Ca represent obligations which are speculative in
a high degree. Such issues are often in default or have other marked
shortcomings.

C. Bonds which are rated C are the lowest rated class of bonds and issues
so rated can be regarded as having extremely poor prospects of ever attaining
any real investment standing.

MUNICIPAL BONDS

STANDARD & POOR'S RATINGS GROUP MUNICIPAL BOND RATINGS

AAA. Bonds rated AAA have the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA. Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the higher rated issues only in small degree.

Plus (+) or Minus (-): The ratings from "AA" to "B" may be modified by the
addition of a plus or minus

A-2
<PAGE> 108

sign to show relative standing within the major rating categories.

MOODY'S INVESTORS SERVICE, INC. MUNICIPAL BOND RATINGS

A-3
<PAGE> 109

PROSPECTUS
January 2, 1998

JNL(R) SERIES TRUST
- --------------------------------------------------------------------------------
5901 Executive Drive - Lansing, Michigan 48911

1
<PAGE> 110

intended that this Series will invest primarily in the common stocks of
companies believed by the sub-adviser to have opportunity for capital growth.

THE PPM AMERICA/JNL HIGH YIELD BOND SERIES INVESTS PREDOMINANTLY IN, AND
THE JNL AGGRESSIVE GROWTH SERIES, JNL CAPITAL GROWTH SERIES, JNL GLOBAL EQUITIES
SERIES, JNL/EAGLE CORE EQUITY SERIES, JNL/EAGLE SMALLCAP EQUITY SERIES, PPM
AMERICA/JNL BALANCED SERIES AND SALOMON BROTHERS/JNL GLOBAL BOND SERIES MAY
INVEST IN HIGH YIELD, HIGH RISK BONDS. BONDS OF THIS TYPE ARE TYPICALLY SUBJECT
TO GREATER MARKET FLUCTUATIONS

2
<PAGE> 111

AND RISK OF LOSS OF INCOME AND PRINCIPAL DUE TO DEFAULT BY THE ISSUER THAN ARE
INVESTMENTS IN LOWER YIELDING, HIGHER RATED BONDS. (SEE "INVESTMENT RISKS".)

THE STATEMENT OF ADDITIONAL INFORMATION, DATED JANUARY 2, 1998, IS INCORPORATED
HEREIN BY REFERENCE.

- --------------------------------------------------------------------------------

TABLE OF CONTENTS
- --------------------------------------------------------------------------------

<TABLE>
<CAPTION>
TOPIC PAGE
----- ----
<S> <C>
TRUST EXPENSES.............................................. 4

FINANCIAL HIGHLIGHTS........................................ 6

INVESTMENT OBJECTIVES AND POLICIES.......................... 14

COMMON TYPES OF SECURITIES AND MANAGEMENT PRACTICES......... 32

MANAGEMENT OF THE TRUST..................................... 41

INVESTMENT IN TRUST SHARES.................................. 50

SHARE REDEMPTION............................................ 50

ADDITIONAL INFORMATION...................................... 50

PERFORMANCE ADVERTISING FOR THE SERIES...................... 51

TAX STATUS.................................................. 53
</TABLE>

3
<PAGE> 112

- --------------------------------------------------------------------------------

TRUST EXPENSES
- --------------------------------------------------------------------------------

SHAREHOLDER TRANSACTION EXPENSES

<TABLE>
<S> <C>
MAXIMUM SALES LOAD IMPOSED ON PURCHASES NONE
MAXIMUM SALES LOAD IMPOSED ON REINVESTED DIVIDENDS NONE
DEFERRED SALES LOAD NONE
REDEMPTION FEES NONE
EXCHANGE FEE NONE
</TABLE>

ANNUAL SERIES OPERATING EXPENSES
(As a percentage of average net assets.)

<TABLE>
<CAPTION>
OTHER
MANAGEMENT EXPENSES(AFTER TOTAL SERIES
FEE REIMBURSEMENT) OPERATING EXPENSES
---------- -------------- ------------------
<S> <C> <C> <C>
JNL Aggressive Growth Series.............................. .95% .15% 1.10%
JNL Capital Growth Series................................. .95% .15% 1.10%
JNL Global Equities Series................................ 1.00% .15% 1.15%
JNL/Alger Growth Series................................... .975% .15% 1.125%
JNL/Eagle Core Equity Series.............................. .90% .15%* 1.05%
JNL/Eagle SmallCap Equity Series.......................... .95% .15%* 1.10%
JNL/Putnam Growth Series**................................ .90% .15% 1.05%
JNL/Putnam Value Equity Series**.......................... .90% .15% 1.05%
PPM America/JNL Balanced Series**......................... .75% .15% .90%
PPM America/JNL High Yield Bond Series.................... .75% .15% .90%
PPM America/JNL Money Market Series....................... .60% .15% .75%
Salomon Brothers/JNL Global Bond Series................... .85% .15% 1.00%
Salomon Brothers/JNL U.S. Government & Quality Bond
Series.................................................. .70% .15% .85%
T. Rowe Price/JNL Established Growth Series............... .85% .15% 1.00%
T. Rowe Price/JNL International Equity Investment
Series.................................................. 1.10% .15% 1.25%
T. Rowe Price/JNL Mid-Cap Growth Series................... .95% .15% 1.10%
</TABLE>

4
<PAGE> 113

EXAMPLE -

The following example illustrates the expenses you would incur on a $1,000
investment, assuming (1) 5% annual return and (2) redemption at the end of each
time period:

<TABLE>
<CAPTION>
1 YEAR 3 YEARS 5 YEARS 10 YEARS
------ ------- ------- --------
<S> <C> <C> <C> <C>
JNL Aggressive Growth Series................................ $11 $35 $61 $134
JNL Capital Growth Series................................... $11 $35 $61 $134
JNL Global Equities Series.................................. $12 $37 $63 $140
JNL/Alger Growth Series..................................... $11 $36 $62 $137
JNL/Eagle Core Equity Series................................ $11 $33 N/A N/A
JNL/Eagle SmallCap Equity Series............................ $11 $35 N/A N/A
JNL/Putnam Growth Series.................................... $11 $33 $58 $128
JNL/Putnam Value Equity Series.............................. $11 $33 $58 $128
PPM America/JNL Balanced Series............................. $ 9 $29 $50 $111
PPM America/JNL High Yield Bond Series...................... $ 9 $29 $50 $111
PPM America/JNL Money Market Series......................... $ 8 $24 $42 $93
Salomon Brothers/JNL Global Bond Series..................... $10 $32 $55 $122
Salomon Brothers/JNL U.S. Government & Quality Bond
Series.................................................... $ 9 $27 $47 $105
T. Rowe Price/JNL Established Growth Series................. $10 $32 $55 $122
T. Rowe Price/JNL International Equity Investment Series.... $13 $40 $69 $151
T. Rowe Price/JNL Mid-Cap Growth Series..................... $11 $35 $61 $134
</TABLE>

5
<PAGE> 114

- --------------------------------------------------------------------------------

JNL SERIES TRUST
FINANCIAL HIGHLIGHTS

<TABLE>
<CAPTION>
JNL AGGRESSIVE GROWTH SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD........................ $13.38 $13.13 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)................................ 0.06 0.05 0.01
Net realized and unrealized gains on investments and foreign
currency related items.................................... 0.76 1.10 3.53
------- ------- ------
Total income from investment operations..................... 0.82 1.15 3.54
------- ------- ------
LESS DISTRIBUTIONS:
From net investment income.................................. -- (0.05) --
From net realized gains on investment transactions.......... -- (0.71) (0.41)
Return of capital........................................... -- (0.14) --
------- ------- ------
Total distributions......................................... -- (0.90) (0.41)
------- ------- ------
Net increase................................................ 0.82 0.25 3.13
------- ------- ------
NET ASSET VALUE, END OF PERIOD.............................. $14.20 $13.38 $13.13
======= ====== ======
TOTAL RETURN(A)............................................. 6.13% 8.72% 35.78%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................... $62,173 $29,555 $8,527
Ratio of net operating expenses to average net
assets(b)(c).............................................. 1.10% 1.09% 1.09%
Ratio of net investment income to average net
assets(b)(c).............................................. 1.29% 0.77% 0.27%
Ratio of interest expense and dividends on short positions
to average net assets(b).................................. -- -- --
Portfolio turnover.......................................... 75.11% 85.22% 163.84%
Average commission rate paid(d)............................. $0.0262 $0.0242 n/a
RATIO INFORMATION ASSUMING NO EXPENSE REIMBURSEMENT OR FEES
PAID INDIRECTLY
Ratio of expenses to average net assets(b).................. 1.24% 1.40% 2.77%
Ratio of net investment income to average net assets(b)..... 1.15% 0.46% (1.41)%
</TABLE>

See notes to the financial statements.

6
<PAGE> 115

7
<PAGE> 116

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

See notes to the financial statements.

8
<PAGE> 117

<TABLE>
<CAPTION>
JNL/PUTNAM GROWTH SERIES JNL/PUTNAM VALUE EQUITY SERIES
- ----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
- ----------- ------------ ------------ ----------- ------------ ------------
<C> <C> <C> <C> <C> <C>
$14.21 $12.50 $10.00 $14.50 $12.77 $10.00
0.03 0.04 0.01 0.09 0.10 0.23
1.26 2.12 3.66 1.92 1.97 2.86
------- ------- ------ ------- ------- ------
1.29 2.16 3.67 2.01 2.07 3.09
------- ------- ------ ------- ------- ------
-- (0.05) -- -- (0.15) (0.17)
-- (0.40) (1.17) -- (0.19) (0.15)
-- -- -- -- -- --
------- ------- ------ ------- ------- ------
-- (0.45) (1.17) -- (0.34) (0.32)
------- ------- ------ ------- ------- ------
1.29 1.71 2.50 2.01 1.73 2.77
------- ------- ------ ------- ------- ------
$15.50 $14.21 $12.50 $16.51 $14.50 $12.77
======= ======= ====== ======= ======= ======
9.08% 17.28% 37.69% 13.86% 16.25% 31.14%
$60,325 $22,804 $2,518 $53,953 $17,761 $3,365
1.05% 1.04% 0.95% 0.97% 0.85% 0.87%
0.63% 0.94% 0.28% 2.02% 2.29% 2.33%
0.25% -- -- -- -- --
220.95% 184.33% 255.03% 92.65% 13.71% 30.12%
$0.0481 $0.0175% n/a $0.0370 $0.0259 n/a

1.10% 1.27% 5.38% 1.12% 1.53% 2.28%
0.58% 0.71% (4.15)% 1.87% 1.61% 0.91%
</TABLE>

See notes to the financial statements.

9
<PAGE> 118

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

- -------------------------
* Commencement of operations.
(a) Assumes investment at net asset value at the beginning of the period,
reinvestment of all distributions, and a complete redemption of the
investment at the net asset value at the end of the period. Total return is
not annualized.
(b) Annualized.
(c) Computed after giving effect to the Advisor's expense reimbursement and fees
paid indirectly.
(d) Disclosure required for fiscal years beginning after September 1, 1995.
(e) For the JNL/Putnam Growth Series during the six months ended June 30, 1997,
the net operating expense ratio excludes interest expense and dividends on
short positions. The ratio including interest expense and dividends on short
positions during the six months ended June 30, 1997 was 1.25%.
(f) For the JNL/Putnam Growth series during the six months ended June 30, 1997,
the expense ratio excludes interest expense and dividends on short
positions. The ratio including interest expense and dividends on short
positions during the six months ended June 30, 1997 was 1.30%.

See notes to the financial statements.

10
<PAGE> 119

<TABLE>
<CAPTION>
PPM AMERICA/JNL PPM AMERICA/ SALOMON BROTHERS/
HIGH YIELD BOND SERIES JNL MONEY MARKET SERIES JNL GLOBAL BOND SERIES
- ----------------------------------------- ----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
- ----------- ------------ ------------ ----------- ------------ ------------ ----------- ------------ ------------
<C> <C> <C> <C> <C> <C> <C> <C> <C>
$10.67 $10.23 $10.00 $1.00 $1.00 $1.00 $10.63 $10.46 $10.00
0.30 0.51 0.73 0.02 0.04 0.04 0.27 0.42 0.81
0.41 0.64 0.04 -- -- -- 0.31 0.70 0.24
------- ------- ------ ------- ------- ------ ------- ------- ------
0.71 1.15 0.77 0.02 0.04 0.04 0.58 1.12 1.05
------- ------- ------ ------- ------- ------ ------- ------- ------
-- (0.69) (0.54) (0.02) (0.04) (0.04) -- (0.69) (0.56)
-- (0.02) -- -- -- -- -- (0.26) (0.03)
-- -- -- -- -- -- -- -- --
------- ------- ------ ------- ------- ------ ------- ------- ------
-- (0.71) (0.54) (0.02) (0.04) (0.04) -- (0.95) (0.59)
------- ------- ------ ------- ------- ------ ------- ------- ------
0.71 0.44 0.23 -- -- -- 0.58 0.17 0.46
------- ------- ------ ------- ------- ------ ------- ------- ------
$11.38 $10.67 $10.23 $1.00 $1.00 $1.00 $11.21 $10.63 $10.46
======= ======= ====== ======= ======= ====== ======= ======= ======
6.65% 11.24% 7.82% 2.41% 3.61% 4.59% 5.46% 10.68% 10.74%
$38,728 $13,396 $6,156 $37,856 $23,752 $6,816 $26,366 $12,483 $6,380
0.90% 0.88% 0.88% 0.75% 0.75% 0.75% 1.00% 0.99% 1.00%
8.33% 8.64% 8.34% 4.85% 4.75% 5.06% 7.21% 7.52% 9.01%
-- -- -- -- -- -- -- -- --
94.25 113.08% 186.21% -- -- -- 84.42% 109.85% 152.89%
n/a n/a n/a n/a n/a n/a n/a n/a n/a
0.98% 1.21% 1.50% 0.80% 0.85% 1.30% 1.36% 1.44% 2.14%
8.25% 8.31% 7.72% 4.80% 4.65% 4.51% 6.85% 7.07% 7.87%
</TABLE>

11
<PAGE> 120

JNL SERIES TRUST

FINANCIAL HIGHLIGHTS (CONTINUED)

<TABLE>
<CAPTION>
SALOMON BROTHERS/JNL U.S.
GOVERNMENT & QUALITY BOND SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
SELECTED PER SHARE DATA
NET ASSET VALUE, BEGINNING OF PERIOD........................ $10.20 $10.09 $10.00
INCOME FROM INVESTMENT OPERATIONS:
Net investment income (loss)................................ 0.24 0.24 0.45
Net realized and unrealized gains on investments and foreign
currency
related items............................................. -- 0.24 0.02
------- ------ ------
Total income from investment operations..................... 0.24 0.48 0.47
------- ------ ------
LESS DISTRIBUTIONS:
From net investment income.................................. -- (0.34) (0.34)
From net realized gains on investment transactions.......... -- (0.03) (0.04)
Return of capital........................................... -- -- --
------- ------ ------
Total distributions......................................... -- (0.37) (0.38)
------- ------ ------
Net increase................................................ 0.24 0.11 0.09
------- ------ ------
NET ASSET VALUE, END OF PERIOD.............................. $10.44 $10.20 $10.09
======= ====== ======
TOTAL RETURN(A)............................................. 2.35% 4.82% 4.65%
RATIOS AND SUPPLEMENTAL DATA
Net assets, end of period (in thousands).................... $17,401 $9,832 $3,007
Ratio of net operating expenses to average net
assets(b)(c).............................................. 0.85% 0.84% 0.84%
Ratio of net investment income to average net
assets(b)(c).............................................. 6.11% 5.72% 5.41%
Ratio of interest expense and dividends on short positions
to average
net assets(b)............................................. -- -- --
Portfolio turnover.......................................... 152.20% 218.50% 253.37%
Average commission rate paid(d)............................. n/a n/a n/a
RATIO INFORMATION ASSUMING NO EXPENSE REIMBURSEMENT OR FEES
PAID
INDIRECTLY
Ratio of expenses to average net assets(b).................. 1.09% 1.37% 2.53%
Ratio of net investment income to average net assets(b)..... 5.87% 5.19% 3.72%
</TABLE>

See notes to the financial statements.

12
<PAGE> 121
<TABLE>
<CAPTION>
T. ROWE PRICE/JNL T. ROWE PRICE/JNL INTERNATIONAL
ESTABLISHED GROWTH SERIES EQUITY INVESTMENT SERIES
----------------------------------------- -----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15, ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995* JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31, 1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996 (UNAUDITED) 1996 1996
----------- ------------ ------------ ----------- ------------ ------------
<S> <C> <C> <C> <C> <C> <C>
$12.56 $11.36 $10.00 $12.08 $11.25 $10.00
0.03 0.03 0.07 0.08 0.06 0.04
2.18 1.81 2.68 1.32 0.90 1.21
------- ------- ------ ------- ------- -------
2.21 1.84 2.75 1.40 0.96 1.25
------- ------- ------ ------- ------- -------
-- (0.04) (0.06) -- (0.12) --
-- (0.09) (1.33) -- (0.01) --
-- (0.51) -- -- -- --
------- ------- ------ ------- ------- -------
-- (0.64) (1.39) -- (0.13) --
------- ------- ------ ------- ------- -------
2.21 1.20 1.36 1.40 0.83 1.25
------- ------- ------ ------- ------- -------
$14.77 $12.56 $11.36 $13.48 $12.08 $11.25
======= ======= ====== ======= ======= =======
17.60% 16.12% 28.23% 11.59% 8.54% 12.50%
$80,998 $32,291 $8,772 $74,486 $48,204 $24,211
1.00% 1.00% 1.00% 1.24% 1.25% 1.25%
0.60% 0.59% 0.75% 1.59% 1.09% 0.78%
-- -- -- -- -- --
36.76% 36.41% 101.13% 7.86% 5.93% 16.45%
$0.0349 $0.0288 n/a $0.0018 $0.0257 n/a
1.04% 1.11% 1.11% 1.38% 1.29% 2.14%
0.56% 0.48% 0.48% 1.45% 1.05% (0.11)%

<CAPTION>
T. ROWE PRICE/JNL
MID-CAP GROWTH SERIES
-----------------------------------------
SIX MONTHS PERIOD FROM PERIOD FROM
ENDED APRIL 1, MAY 15,
JUNE 30, 1996 TO 1995*
1997 DECEMBER 31, TO MARCH 31,
(UNAUDITED) 1996 1996
----------- ------------ ------------
<S> <C> <C> <C>
$14.89 $13.43 $10.00
(0.01) (0.05) 0.06
0.92 1.92 3.90
------- ------- -------
0.91 1.87 3.96
------- ------- -------
-- (0.05) --
-- (0.36) (0.53)
-- -- --
------- ------- -------

------- ------- -------

======= ======= =======
6.11% 13.91% 40.06%
$91,573 $47,104 $10,545
1.10% 1.10% 1.10%
(0.21)% (0.81)% 0.82%
-- -- --
22.65% 25.05% 66.04%
$0.0487 $0.0326 n/a
1.12% 1.14% 2.10%
(0.23)% (0.22)% (0.18)%
</TABLE>

See notes to the financial statements.

13
<PAGE> 122

Jackson National Financial Services, Inc. ("JNFSI"), a wholly owned
subsidiary of Jackson National Life Insurance Company, serves as investment
adviser for all the Series of the Trust. Janus Capital Corporation serves as
sub-adviser for the JNL Capital Growth, JNL Aggressive Growth and JNL Global
Equities Series; Fred Alger Management, Inc. serves as sub-adviser for the
JNL/Alger Growth Series; Eagle Asset Management, Inc. serves as sub-adviser for
the JNL/Eagle Core Equity Series and JNL/Eagle SmallCap Equity Series; Putnam
Investment Management, Inc. serves as sub-adviser for the JNL/Putnam Growth and
JNL/Putnam Value Equity Series; PPM America, Inc. serves as sub-adviser for the
PPM America/JNL Balanced, PPM America/JNL High Yield Bond and PPM America/JNL
Money Market Series; Salomon Brothers Asset Management Inc serves as sub-adviser
for the Salomon Brothers/JNL Global Bond and Salomon Brothers/JNL U.S.
Government & Quality Bond Series; T. Rowe Price Associates, Inc. serves as
sub-adviser for the T. Rowe Price/JNL Established Growth and T. Rowe Price/JNL
Mid-Cap Growth Series; and Rowe Price-Fleming International, Inc. serves as
sub-adviser for the T. Rowe Price/JNL International Equity Investment Series.

DIVERSIFICATION

14
<PAGE> 123

INTERNAL REVENUE SERVICE (IRS) LIMITATIONS

- --------------------------------------------------------------------------------
JNL AGGRESSIVE GROWTH SERIES
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
JNL CAPITAL GROWTH SERIES
- --------------------------------------------------------------------------------

15
<PAGE> 124

- --------------------------------------------------------------------------------
JNL GLOBAL EQUITIES SERIES
- --------------------------------------------------------------------------------

16
<PAGE> 125

17
<PAGE> 126

- --------------------------------------------------------------------------------
JNL/ALGER GROWTH SERIES
- --------------------------------------------------------------------------------

as management changes or development of new technology, products or markets or
may be companies providing products or services with a high unit volume growth
rate. The Series may invest up to 35 percent of its total assets in equity
securities of companies that, at the time of purchase, have total market
capitalization of less than $1 billion. In order to afford the Series the
flexibility to take advantage of new opportunities for investments in accordance
with its investment objective, the Series may hold up to 15 percent of its net
assets in money market instruments and repurchase agreements. During temporary
defensive periods, the Series may invest up to 100% of its assets in debt
securities, money market instruments and/or repurchase agreements. The Portfolio
may also purchase restricted securities (subject to a limit on all illiquid
securities of 10 percent of net assets), lend its securities and enter into
"short sales against the box." (See "Common Types of Securities and Management
Practices").

- --------------------------------------------------------------------------------
JNL/EAGLE CORE EQUITY SERIES
- --------------------------------------------------------------------------------

The investment objective of the JNL/Eagle Core Equity Series is long-term
capital appreciation and, secondarily, current income. It is a diversified
Series that seeks to achieve its objective by investing in common stocks that
the sub-adviser believes meet the criteria for one of three individual equity
strategies. The investment strategies which the sub-adviser utilizes to pursue
the Series' objective are the growth equity strategy, the value equity strategy
and the equity income strategy. In pursuing the growth equity strategy, the sub-
adviser will invest in securities which it believes have sufficient growth
potential to offer above-average long-term capital appreciation. Securities
which meet the criteria for the growth equity strategy will have at least one of
the following characteristics:

- expected earnings-per-share growth greater than the average of the S&P
500 Composite Stock Price Index ("S&P 500"); or

- return on equity greater than the average of the S&P 500.

18
<PAGE> 127

the value equity strategy will have at least one of the following
characteristics at the time of purchase:

- price-to-earnings ratio or price-to-book value ratio of less than or
approximately equal to 75% of that of the broader equity market (as
measured by the S&P 500); or

- per share going concern value (as estimated by the sub-adviser) that
exceeds book value and market value; or

- long-term debt below, or approximately equivalent to, tangible net worth.

In pursuing the equity income strategy, the sub-adviser will invest in
income-producing securities.

In selecting common stocks to pursue the value equity strategy, the
sub-adviser screens a universe of over 2500 companies. From this universe, the
sub-adviser anticipates that only a few hundred companies

19
<PAGE> 128

will meet one or more of these investment criteria. Each of the companies is
analyzed individually in terms of its past and present competitive position
within its perspective industry. The sub-adviser makes selections based on its
projections of the companies' growth in earnings and dividends, earnings
momentum, and undervaluation based on a dividend discount model. The sub-adviser
develops target prices and value ranges from this analysis and makes portfolio
selection from among the top-rated securities. The sub-adviser periodically
monitors the Series' holdings of securities meeting these criteria to assure
that they continue to meet the selection criteria. A security normally will be
sold once it reaches its target price, when negative changes occur with respect
to the company or its industry, or when there is a significant change in the
security with respect to one or more of the four selection criteria listed
above. The Series may at times continue to hold equity securities that no longer
meet the criteria but that the sub-adviser deems suitable investments in view of
the Series' investment objective.

- --------------------------------------------------------------------------------
JNL/EAGLE SMALLCAP EQUITY SERIES
- --------------------------------------------------------------------------------

For temporary defensive purposes during anticipated periods of general
market decline, the Series may invest up to 100% of its assets in money market
instruments,

20
<PAGE> 129

including securities issued or guaranteed by the U.S. Government, its agencies
or instrumentalities and repurchase agreements secured thereby, as well as bank
certificates of deposit and banker's acceptances issued by banks having net
assets of at least $1 billion as of the end of their most recent fiscal year,
high-grade commercial paper, and other long- and short-term debt instruments
that are rated A or higher by Moody's or S&P. It is impossible to predict when,
or for how long, such alternative strategies may be utilized.

- --------------------------------------------------------------------------------
JNL/PUTNAM GROWTH SERIES
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
JNL/PUTNAM VALUE EQUITY SERIES
- --------------------------------------------------------------------------------

21
<PAGE> 130

- --------------------------------------------------------------------------------
PPM AMERICA/JNL BALANCED SERIES
- --------------------------------------------------------------------------------

The Series will emphasize investments in investment grade fixed income
securities which are rated

within the four highest categories by recognized rating agencies, e.g., S&P and
Moody's. However, the Series may take a modest position in lower or non-rated
fixed income securities, but the Series will not invest more than 35% of its net
assets, determined at the time of investment, in high yield, high risk fixed
income securities. The Series may invest in bonds rated as low as Ca by Moody's
or CC by S&P. A fixed income securities issue may have its ratings reduced below
the minimum permitted for purchase by the Series. In that event the sub-adviser
will determine whether the Series should continue to hold such issue in its
portfolio. If, in the sub-adviser's opinion, market conditions warrant, the
Series may increase its position in lower or non-rated securities from time to
time. The lower rated and non-rated convertible securities are predominantly
speculative with respect to the issuer's capacity to repay principal and pay
interest. Investment in lower rated and non-rated convertible fixed income
securities normally involves a greater degree of market and credit risk than
does investment in securities having higher ratings. The price of these fixed
income securities will generally move in inverse proportion to interest rates.
In addition, non-rated securities are often less marketable than rated
securities. To the extent that the Series holds any lower rated or non-rated
securities, it may be negatively affected by adverse economic developments,
increased volatility and lack of liquidity. (See "Investment Risks -- High
Yield/High Risk Bonds").

22
<PAGE> 131

Under normal market conditions, the Series will be invested substantially
in long-term (over 10 years to maturity) and intermediate-term (3 to 10 years to
maturity) fixed income securities, with emphasis on higher-yielding,
higher-risk, lower-rated or unrated corporate bonds. These high risk, high yield
bonds typically are subject to greater market fluctuations and risk of loss of
income and principal due to default by the issuer than are investments in
lower-yielding, higher-rated bonds. (See "Investment Risks -- High Yield/High
Risk Bonds").

23
<PAGE> 132

This Series will invest exclusively in the following types of high quality,
U.S. dollar denominated money market instruments that mature in 397 days or
less:

- Obligations issued or guaranteed as to principal and interest by the U.S.
Government, its agencies and instrumentalities.

- Corporate obligations, including commercial paper, of domestic and
foreign issuers.

- Obligations issued or guaranteed by one or more foreign governments or
any of their political subdivisions, agencies or instrumentalities,
including obligations of supranational entities.

- Repurchase agreements on obligations issued or guaranteed by the U.S.
Government, its agencies or instrumentalities.

24
<PAGE> 133

25
<PAGE> 134

likely to lead to a weakened capacity to make principal and interest payments
than is the case with higher grade debt securities.

26
<PAGE> 135

27
<PAGE> 136

At least 65% of the total assets of the Series will be invested in:

(1) U.S. Treasury obligations;

28
<PAGE> 137

29
<PAGE> 138

30
<PAGE> 139

31
<PAGE> 140

SECURITIES AND MANAGEMENT PRACTICES

32
<PAGE> 141

33
<PAGE> 142

not rated by an established rating service, determined on a dollar weighted
average, were:

34
<PAGE> 143

35
<PAGE> 144

PARTICIPATIONS AND ASSIGNMENTS

36
<PAGE> 145

Series may invest in such Loans in the form of participations in Loans
("Participations") and assignments of all or a portion of Loans from third
parties ("Assignments"). Participations typically will result in a Series having
a contractual relationship only with the Lender, not with the borrower. A Series
will have the right to receive payments of principal, interest and any fees to
which it is entitled only from the Lender selling the Participation and only
upon receipt by the Lender of the payments from the borrower. In connection with
purchasing Participations, a Series generally will have no right to enforce
compliance by the borrower with the terms of the loan agreement relating to the
Loan, nor any rights of set-off against the borrower, and a Series may not
benefit directly from any collateral supporting the Loan in which it has
purchased the Participation. As a result, a Series will assume the credit risk
of both the borrower and the Lender that is selling the Participation. In the
event of the insolvency of the Lender selling a Participation, a Series may be
treated as a general creditor of the Lender and may not benefit from any set-off
between the Lender and the borrower. A Series will acquire Participations only
if the Lender interpositioned between a Series and the borrower is determined by
the sub-adviser to be creditworthy. When a Series purchases Assignments from
Lenders, a Series will acquire direct rights against the borrower on the Loan,
except that under certain circumstances such rights may be more limited than
those held by the assigning Lender.

INVESTMENT RISKS

FOREIGN SECURITIES

37
<PAGE> 146

Price/JNL International Equity Investment Series are particularly susceptible to
such risks. American Depositary Receipts do not involve the same direct currency
and liquidity risks as foreign securities.

EMERGING MARKETS

FUTURES, OPTIONS AND OTHER DERIVATIVE INSTRUMENTS

The use of futures, options, forward contracts, and swaps ("derivative
instruments") exposes a Series to additional investment risks and transaction
costs. If a

38
<PAGE> 147

sub-adviser seeks to protect a Series against potential adverse movements in the
securities, foreign currency or interest rate markets using these instruments,
and such markets do not move in a direction adverse to the Series, that Series
could be left in a less favorable position than if such strategies had not been
used. Risks inherent in the use of futures, options, forward contracts and swaps
include (1) the risk that interest rates, securities prices and currency markets
will not move in the directions anticipated; (2) imperfect correlation between
the price of derivative instruments and movements in the prices of the
securities, interest rates or currencies being hedged; (3) the fact that skills
needed to use these strategies are different from those needed to select
portfolio securities; (4) the possible absence of a liquid secondary market for
any particular instrument at any time; and (5) the possible need to defer
closing out certain hedged positions to avoid adverse tax consequences.

HIGH YIELD/HIGH RISK BONDS

HIGH YIELD FOREIGN SOVEREIGN DEBT SECURITIES

39
<PAGE> 148

and unemployment. Many of these countries are also characterized by political
uncertainty or instability. Additional factors which may influence the ability
or willingness to service debt include, but are not limited to, a country's cash
flow situation, the availability of sufficient foreign exchange on the date a
payment is due, the relative size of its debt service burden to the economy as a
whole, and its government's policy towards the International Monetary Fund, the
World Bank and other international agencies.

HYBRID INSTRUMENTS

MUNICIPAL OBLIGATIONS

WHEN-ISSUED SECURITIES

40
<PAGE> 149

- --------------------------------------------------------------------------------
MANAGEMENT OF THE TRUST
- --------------------------------------------------------------------------------

INVESTMENT ADVISER

Under Massachusetts law and the Trust's Declaration of Trust and By-Laws,
the management of the business and affairs of the Trust is the responsibility of
the Trustees.

41
<PAGE> 150

<TABLE>
<CAPTION>
(M -- MILLION) $ 0 TO $50 M TO $100 M TO $150 M TO $200 M TO $250 M TO $300 M TO $350 M TO OVER
$50 M $100 M $150 M $200 M $250 M $300 M $350 M $500 M $500 M
% % % % % % % % %
SERIES ------ -------- --------- --------- --------- --------- --------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
JNL Aggressive Growth..... .95 .95 .95 .90 .90 .90 .85 .85 .85
JNL Capital Growth........ .95 .95 .95 .90 .90 .90 .85 .85 .85
JNL Global Equities....... 1.00 1.00 1.00 .95 .95 .95 .90 .90 .90
JNL/Alger Growth.......... .975 .975 .975 .975 .975 .975 .95 .95 .90
JNL/Eagle Core Equity..... .90 .85 .85 .85 .85 .85 .75 .75 .75
JNL/Eagle SmallCap
Equity.................. .95 .95 .95 .90 .90 .90 .90 .90 .85
JNL/Putnam Growth*........ .90 .90 .90 .85 .85 .85 .80 .80 .80
JNL/Putnam Value
Equity**................ .90 .90 .90 .85 .85 .85 .80 .80 .80
PPM America/JNL
Balanced***............. .75 .70 .70 .675 .675 .675 .65 .65 .625
PPM America/JNL High Yield
Bond.................... .75 .70 .70 .675 .675 .675 .65 .65 .625
PPM/America JNL Money
Market.................. .60 .60 .60 .575 .575 .575 .55 .55 .525
Salomon Brothers/JNL
Global Bond............. .85 .85 .85 .80 .80 .80 .80 .80 .75
Salomon Brothers/JNL U.S.
Government & Quality
Bond.................... .70 .70 .70 .65 .65 .65 .60 .60 .55
T. Rowe Price/JNL
Established Growth...... .85 .85 .85 .80 .80 .80 .80 .80 .80
T. Rowe Price/JNL
International Equity
Investment.............. 1.10 1.05 1.05 1.00 1.00 1.00 .95 .95 .90
T. Rowe Price/JNL Mid-Cap
Growth.................. .95 .95 .95 .90 .90 .90 .90 .90 .90
</TABLE>

- -------------------------
* Prior to May 1, 1997, the fee for the JNL/Putnam Growth Series was .90%,
.85%, .80%, .75%, and .70%, respectively.

** Prior to May 1, 1997, the fee for the JNL/Putnam Value Equity Series was
.75%, .70%, .675%, .65% and .625%, respectively.

*** Prior to May 1, 1997, the fee for the PPM America/JNL Balanced Series was
.90%, .80%, .75%, .70% and .65%, respectively.

42
<PAGE> 151

INVESTMENT SUB-ADVISERS

- ---------------

43
<PAGE> 152

PORTFOLIO MANAGEMENT

The following individuals are primarily responsible for the day-to-day
management of the particular Series as indicated below.

JNL GLOBAL EQUITIES SERIES

44
<PAGE> 153

JNL CAPITAL GROWTH SERIES

JNL AGGRESSIVE GROWTH SERIES

JNL/ALGER GROWTH SERIES

JNL/EAGLE CORE EQUITY SERIES

JNL/EAGLE SMALLCAP EQUITY SERIES

JNL/PUTNAM GROWTH SERIES

JNL/PUTNAM VALUE EQUITY SERIES

PPM AMERICA/JNL BALANCED SERIES

PPM AMERICA/JNL HIGH YIELD BOND SERIES

PPM AMERICA/JNL MONEY MARKET SERIES

45
<PAGE> 154

together to manage the assets of the Series. The teams meet regularly to review
portfolio holdings and to discuss purchase and sale activity. The teams adjust
holdings in the portfolios as they deem appropriate in the pursuit of the
Series' investment objectives. PPM has supervised and managed the investment
portfolio of the PPM America/JNL Balanced Series since May 1, 1997, and has
supervised and managed the investment portfolios of the PPM America/JNL High
Yield Bond Series and the PPM America/JNL Money Market Series since the
commencement of operations of each Series.

SALOMON BROTHERS/JNL GLOBAL BOND SERIES

SALOMON BROTHERS/JNL U.S. GOVERNMENT & QUALITY BOND SERIES

T. ROWE PRICE/JNL ESTABLISHED GROWTH SERIES

Robert W. Smith is responsible for the day-to-day management of the T. Rowe
Price/JNL Established Growth Series. Mr. Smith is a Vice President and

46
<PAGE> 155

Equity Portfolio Manager for T. Rowe and Price-Fleming. He is also responsible
for the North American component of other investment company and institutional
client portfolios. Prior to joining T. Rowe in 1992, Mr. Smith was employed as
an Investment Analyst for Massachusetts Financial Services. He earned a BS
(finance and economics) from the University of Delaware and an MBA (finance)
from the Darden Graduate School of Business Administration, University of
Virginia. Mr. Smith has had responsibility for the day-to-day management of the
T. Rowe Price/JNL Established Growth Series since February 21, 1997.

T. ROWE PRICE/JNL INTERNATIONAL EQUITY INVESTMENT SERIES

T. ROWE PRICE/JNL MID-CAP GROWTH SERIES

SUB-ADVISORY ARRANGEMENTS

47
<PAGE> 156

<TABLE>
<CAPTION>
(M -- MILLION) $0 TO $50 M TO $100 M TO $150 M TO $200 M TO $250 M TO $300 M TO $350 M TO OVER
$50 M $100 M $150 M $200 M $250 M $300 M $350 M $500 M $500 M
% % % % % % % % %
SERIES ----- -------- --------- --------- --------- --------- --------- --------- ------
<S> <C> <C> <C> <C> <C> <C> <C> <C> <C>
JNL Aggressive Growth.... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL Capital Growth....... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL Global Equities...... .55 .55 .50 .50 .50 .50 .50 .50 .45
JNL/Alger Growth......... .55 .55 .55 .55 .55 .55 .50 .50 .45
JNL/Eagle Core Equity.... .45 .40 .40 .40 .40 .40 .30 .30 .30
JNL/Eagle SmallCap
Equity................. .50 .50 .50 .45 .45 .45 .45 .45 .40
JNL/Putnam Growth*....... .50 .50 .50 .45 .45 .45 .35 .35 .35
JNL/Putnam Value
Equity**............... .50 .50 .50 .45 .45 .45 .35 .35 .35
PPM America/JNL
Balanced*.............. .25 .20 .20 .175 .175 .175 .15 .15 .125
PPM America/JNL High
Yield Bond............. .25 .20 .20 .175 .175 .175 .15 .15 .125
PPM America/JNL Money
Market................. .20 .15 .15 .125 .125 .125 .10 .10 .075
Salomon Brothers/JNL
Global Bond............ .375 .35 .35 .30 .30 .30 .30 .30 .25
Salomon Brothers/JNL U.S.
Government & Quality
Bond................... .225 .225 .225 .175 .175 .175 .15 .15 .10
</TABLE>

* Prior to May 1, 1997, the sub-advisory fees for these Series were payable to
Phoenix Investment Counsel, Inc. and were: $0 to $50 million -- .50%; $50 to
$150 million -- .40%; $150 to $300 million -- .30%; $300 to $500 million --
.25%; over $500 million -- .20%.

** Prior to May 1, 1997, the sub-advisory fee for this Series was payable to
PPM and was: $0 to $50 million -- .25%; $50 to $150 million -- .20%; $150 to
$300 million -- .175%; $300 to $500 million -- .15%; over $500 million --
.125%.

*** When average net assets exceed this amount, the sub-advisory fee asterisked
is applicable to all amounts in this Series.

48
<PAGE> 157

OTHER TRUST EXPENSES

49
<PAGE> 158

- --------------------------------------------------------------------------------
INVESTMENT IN TRUST SHARES
- --------------------------------------------------------------------------------

- --------------------------------------------------------------------------------
SHARE REDEMPTION
- --------------------------------------------------------------------------------

The Trust may suspend the right of redemption only under the following
unusual circumstances:

- when the New York Stock Exchange is closed (other than weekends and
holidays) or trading is restricted;

- when an emergency exists, making disposal of portfolio securities or the
valuation of net assets not reasonably practicable; or

- during any period when the SEC has by order permitted a suspension of
redemption for the protection of shareholders.

- --------------------------------------------------------------------------------
ADDITIONAL INFORMATION
- --------------------------------------------------------------------------------

50
<PAGE> 159

51
<PAGE> 160

SHAREHOLDER INQUIRIES -- All inquiries regarding the Trust should be
directed to the Trust at the telephone number or address shown on the cover page
of this Prospectus.

52
<PAGE> 161

- --------------------------------------------------------------------------------
TAX STATUS
- --------------------------------------------------------------------------------

53
<PAGE> 162

CUSTODIAN

State Street Bank and Trust Company
1776 Heritage Drive
North Quincy, Massachusetts 02171

INDEPENDENT ACCOUNTANTS

Price Waterhouse LLP
100 East Wisconsin Avenue
Milwaukee, Wisconsin 53202

LEGAL COUNSEL

Blazzard, Grodd & Hasenauer, P.C.
943 Post Road East
Westport, CT 06880

INVESTMENT ADVISER AND TRANSFER AGENT

Jackson National Financial Services, Inc.
5901 Executive Drive
Lansing, Michigan 48911

54
<PAGE> 163

COMMERCIAL PAPER RATINGS

A-1, A-2 AND PRIME-1, PRIME-2 COMMERCIAL PAPER RATINGS

CORPORATE BONDS

STANDARD & POOR'S RATINGS GROUP BOND RATINGS

AAA. Debt rated AAA has the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA. Debt rated AA has a very strong capacity to pay interest and repay
principal and differs from the higher rated issued only in small degree.

CI. The rating CI is reserved for income bonds on which no interest is
being paid.

D. Debt rated D is in default, and payment of interest and/or repayment of
principal is in arrears.

A-1
<PAGE> 164

MOODY'S INVESTORS SERVICE, INC. BOND RATINGS

Such bonds lack outstanding investment characteristics and, in fact, have
speculative characteristics as well.

CAA. Bonds which are rated Caa are of poor standing. Such issues may be in
default or there may be present elements of danger with respect to principal and
interest.

CA. Bonds which are rated Ca represent obligations which are speculative in
a high degree. Such issues are often in default or have other marked
shortcomings.

C. Bonds which are rated C are the lowest rated class of bonds and issues
so rated can be regarded as having extremely poor prospects of ever attaining
any real investment standing.

MUNICIPAL BONDS

STANDARD & POOR'S RATINGS GROUP MUNICIPAL BOND RATINGS

AAA. Bonds rated AAA have the highest rating assigned by Standard & Poor's.
Capacity to pay interest and repay principal is extremely strong.

AA. Bonds rated AA have a very strong capacity to pay interest and repay
principal and differ from the higher rated issues only in small degree.

Plus (+) or Minus (-): The ratings from "AA" to "B" may be modified by the
addition of a plus or minus

A-2
<PAGE> 165

sign to show relative standing within the major rating categories.

MOODY'S INVESTORS SERVICE, INC. MUNICIPAL BOND RATINGS

A-3
<PAGE> 166

PROSPECTUS
January 2, 1998

JNL(R) SERIES TRUST
- --------------------------------------------------------------------------------
5901 Executive Drive - Lansing, Michigan 48911

1
<PAGE> 167

intended that this Series will invest primarily in the common stocks of
companies believed by the sub-adviser to have opportunity for capital growth.

2
<PAGE> 168