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Summary Disclosure Statement of Business Continuity Practices

Principal Funds Distributor, Inc.

Principal Funds Distributor, Inc. (PFD) is dedicated to facilitating the distribution of the Principal mutual funds. In support of this effort, we have developed a written "Business Continuity Plan" (BCP) to help ensure that our core business processes can be performed under a variety of foreseeable adverse circumstances of varying scope. Our plan provides for the continuation of our business in the event of a Significant Business Disruption (SBD).

Due to the limited nature of our FINRA membership agreement, PFD does not maintain customer accounts. As a result, our BCPs are also limited in nature. Our plan provides for the continuation of crucial operations and other activities subsequent to a variety of disruptions. We utilize many approaches to accomplish this goal, including archiving systems data, maintaining alternate business recovery sites, and contracting for off site storage of data. In formulating our plan, we have anticipated several "levels" of Significant Business Disruptions that anticipate the possibility that a disruption may be either internal (a single isolated failure limited solely to our firm) or that the disruption may be external in nature (a disruption that may prevent the operation of the securities markets or a number of firms, such as a terrorist attack, a city flood, or a wide-scale, regional disruption).

In developing our Business Continuity Plan, we have considered a variety of scenarios which may cause our business to be disrupted. Examples of these scenarios include a loss of computer abilities, a loss of communications, or an inability to occupy our offices. Once our Business Continuity Plan has been initiated, we will pursue the protection of firm staff and firm property, then begin to perform financial and operations assessments, recover and resume operations, and protect the firm's books and records. Additional time may be required to retrieve any lost data from off site storage facilities or to complete a transition to a secondary location, but our goal is to otherwise resume operations within 24 hours of a disruption. (This includes disruptions to any systems, buildings, business districts, cities, or regions.)

In the event of a SBD which results in the need to implement our business continuity plan, our plan provides for us to transition our business operations to alternative physical locations. These alternate sites are geographically disperse, and back up data for each site is maintained, and can be used to rebuild systems when necessary.

Although no business continuity plan can accommodate every potential disruption, our plan is reviewed at least annually to ensure appropriate enhancements are implemented due to changes in our business activities or to accommodate revised regulatory requirements. Should material changes to the plan occur, this 'Summary Disclosure Statement' as well as the actual Business Continuity Plan will be updated as necessary.

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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.

This Web site was created and is maintained by Principal Funds Distributor, Inc. exclusively, and not by the Directors of the funds.

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

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