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Merger of the Government & High Quality Bond Fund into the Mortgage Securities Fund Postponed
As a result of the current conditions in the markets for the portfolio securities of the Principal Government & High Quality Bond Fund (the Acquired Fund), Principal Funds management, after consultation with the Board of Directors, has determined to postpone the closing of the combination of the Acquired Fund into the Mortgage Securities Fund (the Acquiring Fund).
Management intends to monitor evolving market conditions and, if the shareholders of the Government & High Quality Bond Fund approve the combination of the Acquired Fund into the Mortgage Securities Fund at their meeting scheduled for February 13, 2009, they will seek to close the transaction as soon as practicable after the originally scheduled date of February 20, 2009.
If the transaction has not closed by April 20, 2009, management will consult further with the Board regarding the appropriate course to be taken.
Shareholders of the Government & High Quality Bond Fund were sent a proxy ballot in December regarding the merger and were notified of this recent action by mail.
Questions
If you have any questions regarding this merger, please contact our Principal Funds Customer Service at 1.800.222.5852.
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To obtain a prospectus, download online or call Customer Service at 1.800.222.5852
While this communication may be used to promote or market a transaction or an idea that is discussed in the publication, it is intended to provide general information about the subject matter covered and is provided with the understanding that The Principal® is not rendering legal, accounting, or tax advice. It is not a marketed opinion and may not be used to avoid penalties under the Internal Revenue Code. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, or accounting obligations and requirements. For more information about our funds, including their full names, please see the Principal Funds, Inc. prospectus or call Customer Service at 1.800.222.5852.
A mutual fund's share price and investment return will vary with market conditions, and the principal value of an investment when you sell your shares may be more or less than the original cost.
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Principal Funds, Inc. is distributed by Principal Funds Distributor, Inc., member of the Principal Financial Group®. Principal Funds Distributor, Principal Shareholder Services, Principal Management Corporation and its affiliates, and Principal Funds, Inc. are collectively referred to as Principal Funds.
Not FDIC or NCUA/NCUSIF insured - May lose value - No bank guarantee - Not a deposit - Not insured by any federal government agency
