Investment Performance - PDF Free Download

Investment Performance Investment results shown represent historical performance and do not guarantee future results. Investment returns and principal values fluctuate with changes in interest rates and other market conditions so the value, when redeemed may be worth more or less than original costs. Current performance may be lower or higher than the performance data shown. In situations where the net and gross total investment expense figures are different, the mutual fund or underlying fund in which a Separate Account invests has waived/capped a portion of its management fees through the date displayed in the Waiver Expiration Date or Contractual Cap Expiration Date column. Differences may also be shown due to the fund family choosing to pay certain expenses that would normally be payable by the fund. Returns displayed are always based on net total investment expense. For more performance information, including most recent monthend performance, visit www.principal.com, contact your representative of the Principal Financial Group (The Principal ), or call our participant contact center at 18005477754. Average Annual Total Returns through 12/31/2016 Inv Manager or SubAdvisor Investment Option 1 yr. 3 yr. 5 yr. 10 yr. Large U.S. Equity Large Value Since Percentile Rankings as of 12/31/2016 Date 1 yr. 3 yr. 5 yr. 10 yr. Total Inv. Exp. Net / Gross Edge Asset Management, Inc. Equity Income R5 Fund 8 15.30 7.50 12.18 6.00 8.78 03/01/2010 38 35 72 34 0.77 / 0.77 LargeCap Value R5 Fund 7.94 5.77 12.91 4.65 5.46 12/06/2000 97 78 56 70 0.67 / 0.67 Westwood / Barrow Hanley LargeCap Value III R5 Fund 16 12.88 7.42 13.46 3.28 5.65 12/06/2000 71 37 43 91 1.02 / 1.03 Russell 1000 Value Index 17.34 8.59 14.80 5.72 Morningstar Category Average Large Value 14.81 6.84 12.97 5.38 Total Funds in Category 1268 1088 934 680 Large Blend Edge Asset Management, Inc. Capital Appreciation R5 Fund 8, 11 8.97 7.76 13.55 7.31 12.15 03/01/2010 71 36 52 10 0.71 / 0.71 LargeCap S&P 500 Index R5 Fund 2, 5, 24 11.49 8.44 14.18 6.50 4.81 12/06/2000 36 15 32 37 0.41 / 0.41 Russell 3000 Index 12.74 8.43 14.67 7.07 Standard & Poor's 500 Index 11.96 8.87 14.66 6.95 Morningstar Category Average Large Blend 10.37 6.80 13.18 6.07 Total Funds in Category 1409 1255 1106 814 Contractual Cap/Waiver Expire Date Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Inv Manager or SubAdvisor Investment Option 1 yr. 3 yr. 5 yr. 10 yr. Large Growth Am Century/Sawgrass Asset Mgmt LargeCap Growth II R5 Fund 16, 28 5.04 6.45 12.30 7.14 3.53 12/06/2000 37 41 65 45 1.11 / 1.15 Columbus Circle Investors LargeCap Growth R5 Fund 5.47 3.15 11.26 5.48 2.22 12/06/2000 96 87 82 84 0.88 / 0.88 Blue Chip R5 Fund 8 8.62 8.06 13.76 03/29/2016 11 13 0.94 / 0.94 T. Rowe Price/Brown Advisory LargeCap Growth I R5 Fund 16 0.76 5.62 13.31 7.99 4.14 12/06/2000 72 56 44 22 0.85 / 0.87 Russell 1000 Growth Index 7.08 8.55 14.50 8.33 Morningstar Category Average Large Growth 3.23 5.70 12.94 6.91 Total Funds in Category 1463 1315 1154 809 Small/Mid U.S. Equity Mid Cap Value LA Capital Mgmt/Victory MidCap Value I R5 Fund 1, 8, 11, 16, 34 14.91 6.43 13.57 6.97 9.32 06/01/2004 73 66 60 42 1.12 / 1.24 Principal Global/Barrow Hanley MidCap Value III R5 Fund 1, 11, 16 12.04 5.93 13.63 6.71 8.47 12/06/2000 90 72 59 48 0.90 / 0.91 Russell Midcap Value Index 20.00 9.45 15.70 7.59 Morningstar Category Average Mid Cap Value 18.06 6.84 13.81 6.76 Total Funds in Category 399 337 301 207 Mid Cap Blend MidCap S&P 400 Index R5 Fund 1, 2, 7, 11, 24 20.12 8.54 14.81 8.67 8.69 12/06/2000 12 16 24 13 0.42 / 0.42 Standard & Poor's 400 MidCap Stock Index 20.74 9.04 15.33 9.16 Morningstar Category Average Mid Cap Blend 14.14 5.89 13.32 6.75 Total Funds in Category 427 371 332 219 Mid Cap Growth Columbus Circle Investors MidCap Growth R5 Fund 1, 11 2.96 5.45 12.45 7.56 2.52 12/06/2000 71 27 38 31 0.94 / 0.94 Robert Baird/William Blair MidCap Growth III R5 Fund 1, 11, 16, 26 4.25 3.04 10.03 6.09 3.27 12/06/2000 60 66 80 70 1.21 / 1.24 Russell Midcap Growth Index 7.33 6.23 13.51 7.83 Morningstar Category Average Mid Cap Growth Small Value Average Annual Total Returns through 12/31/2016 Since Percentile Rankings as of 12/31/2016 Date 1 yr. 3 yr. 5 yr. 10 yr. 6.03 4.03 11.79 6.79 Total Funds in Category 644 588 504 368 DFA/Vaughan Nelson/LA Capital SmallCap Value II R5 Fund 1, 11, 16 25.02 8.21 15.59 6.38 8.56 06/01/2004 59 31 22 64 1.26 / 1.28 Russell 2000 Value Index 31.74 8.31 15.07 6.26 Total Inv. Exp. Net / Gross Morningstar Category Average Small Value 25.99 6.63 13.90 6.73 Total Funds in Category 405 347 308 195 Contractual Cap/Waiver Expire Date 02/28/2018 02/28/2018 Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Inv Manager or SubAdvisor Investment Option 1 yr. 3 yr. 5 yr. 10 yr. Small Blend SmallCap R5 Fund 1, 11, 30 17.02 6.92 15.67 7.01 8.70 12/06/2000 78 40 17 42 1.07 / 1.07 SmallCap S&P 600 Index R5 Fund 1, 2, 6, 11 25.94 8.96 16.09 8.56 9.85 12/06/2000 14 10 11 12 0.42 / 0.42 Russell 2000 Index 21.31 6.74 14.46 7.07 Standard & Poor's 600 Stock Index 26.56 9.47 16.62 9.03 Morningstar Category Average Small Blend 20.78 5.89 13.52 6.79 Total Funds in Category 750 626 534 360 Small Growth AB/Brown/Emerald SmallCap Growth I R5 Fund 1, 11, 16, 35 8.98 3.69 12.69 8.15 5.25 12/06/2000 59 53 42 22 1.27 / 1.34 Russell 2000 Growth Index 11.32 5.05 13.74 7.76 Morningstar Category Average Small Growth 11.20 3.55 12.33 7.08 Total Funds in Category 669 599 531 389 Real Estate Principal Real Estate Inv Real Estate Securities R5 Fund 4 5.68 13.25 12.01 5.43 11.68 12/06/2000 61 15 12 12 1.08 / 1.08 MSCI US REIT Index 8.60 13.23 11.86 4.96 Morningstar Category Average Real Estate 6.89 11.79 10.84 4.28 Total Funds in Category 267 235 208 136 International Equity Diversified Emerging Markets International Emerging Markets R5 Fund 3, 14 8.59 3.53 0.59 0.79 8.09 12/06/2000 49 64 67 60 1.50 / 1.50 MSCI Emerging Markets NR Index 11.19 2.55 1.28 1.84 Morningstar Category Average Diversified Emerging Markets Foreign Large Value 8.47 3.18 1.61 1.32 Total Funds in Category 813 606 425 173 Causeway / Barrow Hanley Overseas R5 Fd 3, 8, 16 1.48 3.14 5.72 4.18 03/01/2012 58 64 45 1.32 / 1.35 MSCI EAFE Value Index 5.02 2.14 6.28 0.22 Morningstar Category Average Foreign Large Value Foreign Large Blend 3.34 2.44 5.37 0.25 Total Funds in Category 337 272 223 139 Origin Asset Management LLP International I R5 Fund 3, 8, 27 4.90 0.96 6.67 0.26 4.49 06/01/2004 94 22 26 54 1.19 / 1.19 Diversified International R5 Fund 3, 20 0.01 1.28 6.07 0.65 3.59 12/06/2000 60 29 44 39 1.11 / 1.11 International Equity Index R5 Fund 2, 3, 22, 23, 24 0.56 2.36 5.84 2.99 12/30/2009 53 58 50 0.60 / 0.60 MSCI ACWI Ex USA Index 4.50 1.78 5.00 0.96 MSCI EAFE NR Index 1.00 1.60 6.53 0.75 Morningstar Category Average Foreign Large Blend Average Annual Total Returns through 12/31/2016 Since Percentile Rankings as of 12/31/2016 Date 1 yr. 3 yr. 5 yr. 10 yr. Total Inv. Exp. Net / Gross Contractual Cap/Waiver Expire Date 0.79 2.10 5.75 0.54 Total Funds in Category 762 606 542 329 Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Inv Manager or SubAdvisor Investment Option 1 yr. 3 yr. 5 yr. 10 yr. Global Real Estate Principal Real Estate Inv Global Real Estate Securities R5 Fund 3, 4, 24 0.24 5.60 10.08 2.63 03/01/2016 75 30 17 1.13 / 1.13 FTSE EPRA/NAREIT Developed Index NR 4.06 5.90 9.48 1.48 Morningstar Category Average Global Real Estate Balanced/Asset Allocation Allocation15% to 30% Equity Multiple SubAdvisors 8, 9, 10, 13, 18, SAM Flexible Income R5 Portfolio 21, 29, 33 1.97 4.20 8.72 0.64 Total Funds in Category 239 186 150 74 6.47 3.41 5.49 5.00 5.97 01/16/2007 25 16 13 9 1.12 / 1.12 SAM Flexible Income Blended Index 4.67 3.99 4.97 4.98 Morningstar Category Average Allocation15% to 30% Equity Allocation30% to 50% Equity 5.55 2.30 3.70 3.53 Total Funds in Category 206 177 154 82 Multiple SubAdvisors Diversified Real Asset R5 Fund 8, 19, 24 5.67 1.87 1.31 3.24 03/29/2016 61 99 99 1.10 / 1.10 Multiple SubAdvisors 8, 9, 13, SAM Conservative Balanced R5 Portfolio 18, 21, 29, 33 5.95 3.47 6.39 5.07 5.33 01/16/2007 54 27 28 16 1.22 / 1.22 Diversified Real Asset Strategic Index 12.40 0.19 1.31 SAM Conservative Balanced Blended Index 5.62 4.33 6.45 5.16 Morningstar Category Average Allocation30% to 50% Equity Allocation50% to 70% Equity 6.62 2.91 5.68 4.06 Total Funds in Category 515 413 362 234 Multiple SubAdvisors SAM Balanced R5 Portfolio 8, 21, 29, 33 6.38 3.82 8.08 5.23 7.07 01/16/2007 59 54 50 37 1.27 / 1.27 SAM Balanced Blended Index 7.04 4.90 8.54 5.40 Morningstar Category Average Allocation50% to 70% Equity Allocation70% to 85% Equity Multiple SubAdvisors 8, 9, 13, SAM Conservative Growth R5 Portfolio 18, 21, 29, 33 7.34 3.87 8.04 4.80 Total Funds in Category 810 710 606 419 6.64 3.99 9.44 5.02 7.22 01/16/2007 69 35 30 28 1.34 / 1.34 SAM Conservative Growth Blended Index 8.42 5.42 10.60 5.52 Morningstar Category Average Allocation70% to 85% Equity Average Annual Total Returns through 12/31/2016 Since Percentile Rankings as of 12/31/2016 Date 1 yr. 3 yr. 5 yr. 10 yr. Total Inv. Exp. Net / Gross Contractual Cap/Waiver Expire Date 7.93 3.50 8.80 4.22 Total Funds in Category 406 352 293 210 Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Inv Manager or SubAdvisor Investment Option 1 yr. 3 yr. 5 yr. 10 yr. TargetDate Retirement Multiple SubAdvisors 9, 13, Principal LifeTime Hybrid Income CIT R5 18, Multiple SubAdvisors Principal LifeTime Strategic Income R5 Fund 9, 13, 18, 21, 29, 32 4.27 2.50 3.76 5.69 07/07/2009 82 58 73 0.88 / 0.88 4.51 2.53 4.35 2.81 4.12 03/01/2001 74 55 52 75 0.85 / 0.85 S&P Target Date Retirement Income Index 5.01 3.20 4.66 3.89 Morningstar Category Average TargetDate Retirement Allocation85%+ Equity Multiple SubAdvisors 8, 9, 10, 13, 18, SAM Strategic Growth R5 Portfolio 21, 29, 33 5.10 2.59 4.31 3.58 Total Funds in Category 171 133 113 58 5.80 3.91 10.40 4.89 7.54 01/16/2007 89 39 49 26 1.30 / 1.30 SAM Strategic Growth Blended Index 9.28 5.65 12.04 5.46 Morningstar Category Average Allocation85%+ Equity TargetDate 20002010 Multiple SubAdvisors Principal LifeTime Hybrid 2010 CIT R5 8.45 3.84 10.34 4.30 Total Funds in Category 160 138 125 91 5.37 2.96 5.86 8.20 07/07/2009 73 66 59 0.88 / 0.88 Multiple SubAdvisors Principal LifeTime 2010 R5 Fund 21, 29, 32 5.03 2.75 6.04 3.25 4.65 03/01/2001 83 73 47 67 0.90 / 0.90 S&P Target Date 2010 Index 5.82 3.52 5.75 4.21 Morningstar Category Average TargetDate 20002010 TargetDate 2015 Multiple SubAdvisors Principal LifeTime Hybrid 2015 CIT R5 5.86 3.04 5.77 3.64 Total Funds in Category 111 84 69 40 6.12 3.29 6.77 9.14 07/07/2009 58 50 46 0.87 / 0.87 Multiple SubAdvisors Principal LifeTime 2015 R5 Fund 21, 29, 32 5.34 2.84 6.79 4.17 02/29/2008 77 67 45 0.93 / 0.93 S&P Target Date 2015 Index 6.56 3.92 6.79 4.50 Morningstar Category Average TargetDate 2015 TargetDate 2020 Multiple SubAdvisors Principal LifeTime Hybrid 2020 CIT R5 6.12 3.10 6.53 4.10 Total Funds in Category 131 91 70 24 6.64 3.71 7.72 9.75 07/07/2009 38 25 20 0.87 / 0.87 Multiple SubAdvisors Principal LifeTime 2020 R5 Fund 21, 29, 32 5.56 3.09 7.71 3.75 5.22 03/01/2001 74 56 20 47 0.94 / 0.94 S&P Target Date 2020 Index 7.22 4.18 7.66 4.68 Morningstar Category Average TargetDate 2020 Average Annual Total Returns through 12/31/2016 Since Percentile Rankings as of 12/31/2016 Date 1 yr. 3 yr. 5 yr. 10 yr. Total Inv. Exp. Net / Gross Contractual Cap/Waiver Expire Date 6.23 3.13 6.48 3.71 Total Funds in Category 221 176 146 67 Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Inv Manager or SubAdvisor Investment Option 1 yr. 3 yr. 5 yr. 10 yr. TargetDate 2025 Multiple SubAdvisors Principal LifeTime Hybrid 2025 CIT R5 7.23 4.03 8.39 10.57 07/07/2009 36 21 31 0.87 / 0.87 Multiple SubAdvisors Principal LifeTime 2025 R5 Fund 21, 29, 32 5.81 3.25 8.19 4.56 02/29/2008 83 65 36 0.96 / 0.96 S&P Target Date 2025 Index 7.82 4.32 8.37 4.78 Morningstar Category Average TargetDate 2025 TargetDate 2030 Multiple SubAdvisors Principal LifeTime Hybrid 2030 CIT R5 6.73 3.38 7.66 3.93 Total Funds in Category 195 149 113 34 7.66 4.26 8.97 11.05 07/07/2009 40 17 28 0.87 / 0.87 Multiple SubAdvisors Principal LifeTime 2030 R5 Fund 21, 29, 32 5.52 3.27 8.60 3.93 5.28 03/01/2001 90 66 44 47 0.97 / 0.97 S&P Target Date 2030 Index 8.35 4.50 9.05 4.82 Morningstar Category Average TargetDate 2030 TargetDate 2035 Multiple SubAdvisors Principal LifeTime Hybrid 2035 CIT R5 7.33 3.53 8.06 3.88 Total Funds in Category 221 176 146 67 8.10 4.46 9.47 11.21 07/07/2009 38 16 39 0.86 / 0.86 Multiple SubAdvisors Principal LifeTime 2035 R5 Fund 21, 29, 32 5.00 3.25 9.04 4.78 02/29/2008 93 70 49 1.00 / 1.00 S&P Target Date 2035 Index 8.85 4.66 9.59 4.86 Morningstar Category Average TargetDate 2035 TargetDate 2040 Multiple SubAdvisors Principal LifeTime Hybrid 2040 CIT R5 7.57 3.64 8.94 4.15 Total Funds in Category 195 149 113 34 8.37 4.62 9.93 11.54 07/07/2009 37 17 31 0.87 / 0.87 Multiple SubAdvisors Principal LifeTime 2040 R5 Fund 21, 29, 32 5.18 3.29 9.35 4.01 5.39 03/01/2001 94 69 50 49 0.99 / 0.99 S&P Target Date 2040 Index 9.23 4.76 10.00 4.92 Morningstar Category Average TargetDate 2040 TargetDate 2045 Multiple SubAdvisors Principal LifeTime Hybrid 2045 CIT R5 7.95 3.74 8.99 4.04 Total Funds in Category 221 176 146 67 8.64 4.72 10.24 11.85 07/07/2009 35 13 29 0.88 / 0.88 Multiple SubAdvisors Principal LifeTime 2045 R5 Fund 21, 29, 32 5.24 3.37 9.61 4.87 02/29/2008 93 71 54 1.01 / 1.01 S&P Target Date 2045 Index 9.54 4.83 10.31 4.89 Morningstar Category Average TargetDate 2045 Average Annual Total Returns through 12/31/2016 Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option, Since Percentile Rankings as of 12/31/2016 Date 1 yr. 3 yr. 5 yr. 10 yr. Total Inv. Exp. Net / Gross Contractual Cap/Waiver Expire Date 7.93 3.78 9.61 4.22 Total Funds in Category 195 149 109 33

Inv Manager or SubAdvisor Investment Option 1 yr. 3 yr. 5 yr. 10 yr. TargetDate 2050 Multiple SubAdvisors Principal LifeTime Hybrid 2050 CIT R5 8.87 4.81 10.49 12.13 07/07/2009 29 14 18 0.88 / 0.88 Multiple SubAdvisors Principal LifeTime 2050 R5 Fund 21, 29, 32 5.33 3.39 9.84 4.06 5.18 03/01/2001 91 69 49 41 1.02 / 1.02 S&P Target Date 2050 Index 9.74 4.90 10.60 4.99 Morningstar Category Average TargetDate 2050 TargetDate 2055 Multiple SubAdvisors Principal LifeTime Hybrid 2055 CIT R5 8.22 3.87 9.34 4.07 Total Funds in Category 213 168 129 23 9.06 4.89 10.57 12.30 07/07/2009 25 12 26 0.89 / 0.89 Multiple SubAdvisors Principal LifeTime 2055 R5 Fund 21, 29, 32 5.39 3.43 9.88 4.88 02/29/2008 93 74 57 1.02 / 1.02 S&P Target Date 2055 Index 9.94 4.92 10.82 Morningstar Category Average TargetDate 2055 TargetDate 2060+ Multiple SubAdvisors 9, 10, 13, Principal LifeTime Hybrid 2060 CIT R5 18, 8.00 3.90 9.86 5.64 Total Funds in Category 193 121 81 1 9.07 5.25 01/01/2014 18 0.89 / 0.89 Multiple SubAdvisors Principal LifeTime 2060 R5 Fund 21, 29, 32 5.31 3.36 7.45 03/01/2013 92 25 1.04 / 1.04 S&P Target Date 2060+ Index 10.08 4.92 10.82 Morningstar Category Average TargetDate 2060+ ShortTerm Fixed Income Stable Value Morley Financial Services, Inc Principal Stable Value Fund 7.81 3.31 Total Funds in Category 106 9 1.14 0.97 1.00 1.90 3.30 01/09/1997 0.90 / 0.90 Bloomberg Barclays 13 Yr Government Index 0.87 0.69 0.59 2.18 Short Term Bond Edge Asset Management, Inc. ShortTerm Income R5 Fund 8, 12, 13, 24 2.18 1.34 1.98 2.93 3.85 07/12/2010 35 31 24 30 0.68 / 0.68 Bloomberg Barclays Credit 13 Years Index 2.11 1.36 1.84 3.25 Morningstar Category Average Short Term Bond Average Annual Total Returns through 12/31/2016 Since Percentile Rankings as of 12/31/2016 Date 1 yr. 3 yr. 5 yr. 10 yr. Total Inv. Exp. Net / Gross Contractual Cap/Waiver Expire Date 2.08 1.06 1.46 2.55 Total Funds in Category 522 445 357 252 Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Inv Manager or SubAdvisor Investment Option 1 yr. 3 yr. 5 yr. 10 yr. Fixed Income IntermediateTerm Bond Edge Asset Management, Inc. Income R5 Fund 8, 12, 13 5.21 2.98 3.61 5.15 7.47 03/01/2010 9 37 13 12 0.75 / 0.75 Mellon Capital Mgmt Bond Market Index R5 Fund 2, 12, 13 1.95 2.36 1.57 2.91 12/30/2009 84 72 90 0.51 / 0.54 Core Plus Bond R5 Fund 12, 13, 24, 31 3.75 2.65 2.72 3.58 4.23 12/06/2000 32 58 45 77 0.76 / 0.76 Bloomberg Barclays Aggregate Bond Index 2.65 3.03 2.23 4.34 Morningstar Category Average IntermediateTerm Bond Intermediate Government Edge Asset Management, Inc. 8, 12, Government & High Quality Bond R5 Fund 13 Bloomberg Barclays US Agency Fixed Rate MBS Index Morningstar Category Average Intermediate Government InflationProtected Bond 3.23 2.73 2.61 4.10 Total Funds in Category 985 869 759 541 1.49 2.40 1.93 3.89 6.33 12/15/2008 20 29 13 28 0.67 / 0.76 1.67 3.09 2.07 4.31 0.89 2.02 1.15 3.52 Total Funds in Category 271 255 240 176 BlackRock Financial Mgmt, Inc. Inflation Protection R5 Fund 12, 13, 24 3.68 1.34 0.32 1.15 1.18 12/29/2004 69 54 60 94 0.65 / 0.65 Bloomberg Barclays US Treas TIPS Index 4.68 2.26 0.89 4.36 Morningstar Category Average InflationProtected Bond Preferred Stock 4.59 1.35 0.42 3.43 Total Funds in Category 235 191 165 106 Spectrum Preferred Securities R5 Fund 8, 12, 13 3.52 6.48 7.86 5.96 5.92 06/01/2004 76 54 49 14 0.97 / 0.97 Preferreds Blended Index 3.76 6.63 7.73 3.80 Morningstar Category Average Preferred Stock 5.66 6.49 7.79 5.45 Total Funds in Category 56 42 36 16 Please see important information at the end of this presentation. Asset Class ShortTerm Fixed Income Average Annual Total Returns through 12/31/2016 Since Investment Option Name and Description Fixed Income Guaranteed Option 36,37 Percentile Rankings as of 12/31/2016 Date 1 yr. 3 yr. 5 yr. 10 yr. Total Inv. Exp. Net / Gross Contractual Cap/Waiver Expire Date 12/30/2017 12/30/2017 Crediting Rate 12/01/2016 05/31/2017 This group annuity contract is a guarantee, backed by the assets in the multibillion dollar general account of the Principal Life Insurance Company (Principal Life). The contract makes benefit payments at book value (i.e., no market value adjustments or surrender charge adjustments) for plan benefit events. An employerlevel surrender of the plan's interest or initiated transfer will be subject to either a 12month irrevocable advance notice or a 5% surrender charge, whichever the employer chooses. 1.10 39 0.65 Rate Level Service Fee 38 Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Important Information 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. Subadvised Investment Options include Principal Funds, Inc. mutual funds. Principal Funds, Inc is distributed by Principal Funds Distributor, Inc. Securities are offered through Principal Securities, Inc., 8005477754, member SIPC and/or independent broker/dealers. Securities sold by a Principal Securities Registered Representative are offered through Principal Securities. Principal Funds Distributor, Principal Securities, and Principal Life are members of the Principal Financial Group, Des Moines, IA 50392. Certain investment options may not be available in all states or U.S. commonwealths. Percentile rankings are based on total returns in accordance with the appropriate Morningstar peer group. Returns shown for periods of less than one year are not annualized. All returns displayed here are after Total Investment Expense of the investment option. Investment options are subject to investment risk. Shares or unit values will fluctuate and investments, when redeemed, may be worth more or less than their original cost. This does not apply, however, to the guaranteed portions of group annuity contracts issued by Principal Life that constitute guaranteed benefit policies as defined in ERISA 401(b)(2)(B). Any operating expenses of a mutual fund or underlying mutual fund that are part of net Total Investment Expense are obtained from the mutual fund's most recent prospectus. The operating expenses shown as part of Total Investment Expense include voluntary expense limits and fee credit. Investors should carefully consider a mutual fund s investment objectives, risks, charges, and expenses prior to investing. A prospectus, or summary prospectus if available, containing this and other information can be obtained by contacting a financial professional, visiting principal.com, or calling 18005477754. Read the prospectus carefully before investing. Insurance products and plan administrative services, if applicable, are provided by Principal Life Insurance Company. Principal mutual funds are part of the Principal Funds, Inc. series. Principal Funds, Inc. is distributed by Principal Funds Distributor, Inc. Securities are offered through Principal Securities, Inc., 8005477754, member SIPC and/or independent broker/dealers. Securities sold by a Principal Securities Registered Representative are offered through Principal Securities. Principal Funds Distributor, Principal Securities and Principal Life are members of the Principal Financial Group, Des Moines, IA 50392. Certain investment options may not be available in all states or U.S. commonwealths. For a Mutual Fund investment option, Total Investment Expense gross equals the sum of (a) the total fund operating expenses plus (b) if the mutual fund invests in other mutual funds, the weightedaverage management fee of those other mutual funds, as listed in the most recent prospectus. The actual Total Investment Expense may change if the mutual fund investment option's allocation of assets to other mutual funds changes. This report includes investment options that contain information from a variety of sources. A primary source is Morningstar which provides holdings information, operations data, and rankings or statistics proprietary to Morningstar. Morningstar is generally the source of information on mutual funds unaffiliated with the Principal. (C) 2017 Morningstar, Inc. All Rights Reserved. Part of the investment data contained herein includes Morningstar peer group comparisons, ratings, holdings and other data from its mutual fund and variable annuity databases and : (1) is proprietary to Morningstar and/or its content providers: (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. See the Principal Funds, Inc. prospectus for the full name of each Fund. Compliance number: t16083102t1 Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

1. Smallcap and midcap investment options are subject to more fluctuation in value and may have additional risks than other investment options with stocks of larger, more stable companies. 2. Each index based investment option is invested in the stocks or bonds of the index it tracks. Performance of indexes reflects the unmanaged results for the market segment the selected stocks or bonds represent. There is no assurance an index based investment option will match the performance of the index tracked. 3. International and global investment options are subject to additional risk due to fluctuating exchange rates, foreign accounting and financial policies, and other economic and political environments. 4. Real Estate investment options are subject to investment and liquidity risk and other risks inherent in real estate such as those associated with general and local economic conditions. Property values can decline due to environmental and other reasons. In addition, fluctuation in interest rates can negatively impact the performance of real estate investment options. 5. S&P 500 is a trademark of The McGrawHill Companies, Inc., and has been licensed for use by Principal Life Insurance Company and Principal Management Corporation. The product is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of investing in the product. 6. S&P SmallCap 600 is a trademark of The McGrawHill Companies, Inc. and has been licensed for use by Principal Life Insurance Company and Principal Management Corporation. The product is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of investing in the product. 7. S&P MidCap 400 is a trademark of The McGrawHill Companies, Inc. and has been licensed for use by Principal Life Insurance Company and Principal Management Corporation. The product is not sponsored, endorsed, sold or promoted by Standard & Poor's and Standard & Poor's makes no representation regarding the advisability of investing in the product. 8. These calculated returns reflect the historical performance of the oldest share class of the fund, adjusted to reflect a portion of the fees and expenses of this share class. For time periods prior to inception date of the fund, predecessor performance is reflected. Please see the fund's prospectus for more information on specific expenses, and the fund's most recent shareholder report for actual date of first sale. Expenses are deducted from income earned by the fund. As a result, dividends and investment results will differ for each share class. 9. Equity investment options involve greater risk, including heightened volatility, than fixedincome investment options. Fixedincome investment options are subject to interest rate risk, and their value will decline as interest rates rise. 10. Asset allocation does not guarantee a profit or protect against a loss. Investing in real estate, smallcap, international, and highyield investment options involves additional risks. 11. Smallcap and midcap stocks may have additional risks, including greater price volatility. 12. Fixedincome investment options are subject to interest rate risk, and their value will decline as interest rates rise. Neither the principal of bond investment options nor their yields are guaranteed by the U.S. government. 13. Fixedincome and asset allocation investment options that invest in mortgage securities are subject to increased risk due to real estate exposure. 14. Instances of high doubledigit returns were achieved primarily during favorable market conditions and may not be sustainable over time. 16. The manager of the Fund, Principal Management Corporation, invests between 10% and 40% of the Fund's assets in common stocks in an attempt to match or exceed the performance of the Fund's benchmark index for performance. 18. Asset allocation and diversification do not ensure a profit or protect against a loss. Additionally there is no guarantee this investment option will provide adequate income at or through retirement. Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

19. Fixedincome investment options are subject to interest rate risk, and their value will decline as interest rates rise. Neither the principal of bond investment options nor their yields are guaranteed by the U.S. or any other government entity. Concentrating investments in natural resources industries can be affected significantly by events relating to those industries, such as variations in the commodities markets, weather, disease, embargoes, international, political and economic developments, the success of exploration projects, tax and other government regulations and other factors. Investment in derivatives entails specific risks relating to liquidity, leverage and credit that may reduce returns and/or increase volatility. REIT securities are subject to risk factors associated with the real estate industry and tax factors of REIT registration. An MLP that invests in a particular industry (e.g., oil and gas) may be harmed by detrimental economic events within that industry. As partnerships, MLPs may be subject to less regulation (and less protection for investors) under state laws than corporations. In addition, MLPs may be subject to state taxation in certain jurisdictions, which may reduce the amount of income paid by an MLP to its investors. 20. In March 2010, the Class experienced a significant one time gain of approximately $0.08/share as the result of a settlement in an SEC administrative proceeding. If such gain had not been recognized, the total return amounts expressed herein would have been lower. 21. The Investment Advisor will display "Multiple SubAdvisors" for certain targetdate, targetrisk and specialty investment options where the assets are directed by the Investment Manager to multiple underlying investment options. These underlying investment options may use multiple subadvisors who are responsible for the daytoday management responsibilities. 22. The International Equity Index investment option described herein is indexed to an MSCI index. 23. The funds or securities referred to herein are not sponsored, endorsed, or promoted by MSCI, and MSCI bears no liability with respect to any such funds or securities or any index on which such funds or securities are based. The Principal International Equity Index Fund's Statement of Additional Information contains a more detailed description of the limited relationship MSCI has with Principal and any related funds. 24. The risks associated with derivative investments include that the underlying security, interest rate, market index, or other financial asset will not move in the direction the Investment Adviser and/or SubAdvisor anticipated, the possibility that there may be no liquid secondary market, the risk that adverse price movements in an instrument can result in a loss substantially greater than a fund's initial investment, the possibility that the counterparty may fail to perform its obligations; and the inability to close out certain hedged positions to avoid adverse tax consequences. 26. Effective January 13, 2014, this portfolio is subadvised by Baird and William Baird and William Blair. Prior to January 13, 2014, this portfolio was subadvised by Turner and Jacobs Levy. The portfolio has had various subadvisors since its inception. Performance results displayed reflect all subadvisors managing this portfolio during the time periods displayed. 27. Effective June 3, 2014, this portfolio is subadvised by Origin Asset Management. Prior to June 3, 2014, this portfolio was subadvised by Fidelity and Schroders. The portfolio has had various subadvisors since its inception. Performance results displayed reflect all subadvisors managing this portfolio during the time periods displayed. 28. Effective December 30, 2014, this portfolio is subadvised by American Century and Sawgrass Asset Management. Prior to December 30, 2014, the portfolio was subadvised by American Century and Montag & Caldwell. The portfolio has had various subadvisors since its inception. Performance results displayed reflect all subadvisors managing this portfolio during the time periods displayed. 29. International and global investing involves greater risks such as currency fluctuations, political/social instability and differing accounting standards. 30. Formerly known as SmallCap Blend Fund. 31. Formerly known as Bond & Mortgage Securities Fund. 32. This Principal LifeTime Fund indirectly bears its pro rata share of the management fees incurred by the underlying Principal Funds in which this fund invests. Based on the asset allocation of the Principal LifeTime Funds outlined in the prospectus dated March 1, 2016, the weighted average operating expenses of the underlying funds are: Principal LifeTime Strategic Income, 0.58%; Principal LifeTime 2010, 0.63%; Principal LifeTime 2015, 0.66%; Principal LifeTime 2020, 0.68%; Principal LifeTime 2025, 0.70%; Principal LifeTime 2030, 0.71%; Principal LifeTime 2035, 0.73%; Principal LifeTime 2040, 0.73%; Principal LifeTime 2045, 0.74%; Principal LifeTime 2050, 0.75%; Principal LifeTime 2055, 0.74%; Principal LifeTime 2060, 0.75%. While the operating expenses of the underlying mutual funds are not part of the Principal LifeTime Fund's operating expenses they are included in the Total Investment Expense. Performance results shown for the Principal LifeTime Fund reflect the application of these expenses. Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

33. This Principal Strategic Asset Management Portfolio (SAM) indirectly bears its pro rata share of the management fees incurred by the underlying Principal Funds in which this portfolio invests. Based on the asset allocation of the SAM Portfolio outlined in the prospectus dated March 1, 2016, the weighted average operating expenses of the underlying funds are: Flexible Income, 0.55%; Conservative Balanced, 0.65%; Balanced, 0.70%; Conservative Growth, 0.77%; Strategic Growth, 0.73%. While the operating expenses of the underlying mutual funds are not part of the SAM Portfolio operating expenses they are included in the Total Investment Expense. Performance results shown for the SAM Portfolios reflect the application of these expenses. 34. Effective June 30, 2016, this portfolio is subadvised by LA Capital and Victory Capital. Prior to June 30, 2016, the portfolio was subadvised by Goldman Sachs and LA Capital. The portfolio has had various subadvisors since its inception. Performance results displayed reflect all subadvisors managing this portfolio during the time periods displayed. 35. Effective September 30, 2016, this portfolio is subadvised by AB LP, Brown Advisory and Emerald Advisors, Inc. Prior to September 30, 2016, the portfolio was subadvised by AB LP, Brown Advisory, Emerald Advisors, Inc. and Columbus Circle Investors. The portfolio has had various subadvisors since its inception. Performance results displayed reflect all subadvisors managing this portfolio during the time periods displayed. 36. Principal Fixed Income Guaranteed Option is the Group Annuity Contract Custodial Guaranteed Interest Contract available through Principal Life Insurance Company, a member of the Principal Financial Group, Des Moines Iowa 50392. May not be available in all states. 37. If the retirement program provides a participant access to the Fixed Income Guaranteed Option and Competing Plan Investment Options, participant transfers, either directly or indirectly, to Competing Plan Investment Options will generally be subject to an Equity Wash. An Equity Wash requires that transfers must be directed to a noncompeting investment option under the plan for 90days before such transferred amounts may be directed to any other Competing Plan Investment Option. Competing Plan Investment Options include other guaranteed investment options, or fixed income, money market, or bond funds that have ever had an average duration of 3.0 years or less. 38. The Fixed Income Guaranteed Option is a guarantee backed by the general account of Principal Life Insurance Company(Principal Life). As a guarantee, it does not have an investment management fee or expense ratio; those are concepts unique to investment products. The Rate Level Service Fee illustrated here represents the part of the overall fee arrangement that the plan pays for services from Principal Life as a provider of administrative services to the plan, as agreed to in the Service and Expense Agreement for the plan. 39. The crediting rate shown for the Fixed Income Guaranteed Option is an effective annual rate and is displayed here as the rate guaranteed by Principal Life net of the fees for administrative services to the plan illustrated in the Rate Level Service Fee column for the Fixed Income Guaranteed Option. 43. This Principal LifeTime Hybrid CIT indirectly bears its pro rata share of the Total Investment Expense incurred by the underlying investment options in which this fund invests. Based on the asset allocation of the Principal LifeTime Hybrid CITs as of March 31, 2016, the weighted average operating expenses of the underlying investment options are: Principal LifeTime Hybrid Income, 0.33%; Principal LifeTime Hybrid 2010, 0.33%; Principal LifeTime Hybrid 2015, 0.32%; Principal LifeTime Hybrid 2020, 0.32%; Principal LifeTime Hybrid 2025, 0.32%; Principal LifeTime Hybrid 2030, 0.32%; Principal LifeTime Hybrid 2035, 0.32%; Principal LifeTime Hybrid 2040, 0.32%; Principal LifeTime Hybrid 2045, 0.33%; Principal LifeTime Hybrid 2050, 0.33%; Principal LifeTime Hybrid 2055, 0.34%; Principal LifeTime Hybrid 2060, 0.34%. This fund may invest in underlying mutual funds. For more information on the underlying funds and their expenses, see the prospectus for those funds. 44. Effective January 1, 2017, the trustee for the Principal LifeTime Hybrid Collective Investment Funds changed from Principal Trust Company to Principal Global Investors Trust Company. Principal Trust Target Date Collective Investment Funds were renamed the Principal LifeTime Hybrid Collective Investment Funds (CITs). 45. For the Principal Lifetime Hybrid Collective Investment Funds (CITS), Total Investment Expense Net equals the sum of these expenses: (a) the amount of money, expressed as a percentage, deducted for the cost of managing the collective investment trust, and where applicable, fees for plan administrative services and compensation to your Financial Professional based on the amount of business they have with us including such factors as total deposits and assets, plus (b) if the collective investment trust invests in an underlying mutual fund, separate account, or collective investment trust, the total investment operating expenses of the underlying investment option, as listed in the most recent prospectus if applicable. Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

46. The Principal LifeTime Hybrid Collective Investment Funds (CITs) are collective investment trusts maintained by Trust Company, (the Trust Company). The Trust Company has retained, LLC (the Adviser), to serve as investment adviser with respect to the CITs, subject to the Trust Companys supervision and review. The Adviser is an indirect wholly owned subsidiary of Principal Financial Group. Inc. and is under common control with the Trust Company. The Adviser also manages portfolios which may be included as underlying investments in the CITs. The Adviser receives management fees from these portfolios. The Adviser or other affiliates of the Trust Company may provide services to the CITs and may receive fees for such services. The CITs are available only to certain qualified retirement plans and governmental 457(b) plans. 47. The CITs are available only to certain qualified retirement plans and governmental 457(b) plans. The CITs are not mutual funds and are not registered with the Securities and Exchange Commission, the State of Oregon, or any other regulatory body. Units of the CITs are not deposits or obligations of, guaranteed by, or insured by the Trust Company or any affiliate, and are not insured by the FDIC or any other federal or state government agency. The value of the CITs will fluctuate so that when redeemed, units may be worth more or less than the original cost. The declaration of trust, participation agreement, and disclosure documents contain important information about investment objectives, risks, fees and expenses associated with investment in the CITs and should be read carefully before investing. The declaration of trust is available at principal.com. A copy of the participation agreement can be obtained from your plan administrator. Benchmark Descriptions Bloomberg Barclays 13 Yr Government Index is comprised of both the Treasury Bond Index and the Agency Bond Index. Bloomberg Barclays Aggregate Bond Index represents securities that are domestic, taxable, and dollar denominated. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage passthrough securities, and assetbacked securities. These major sectors are subdivided into more specific indices that are calculated and reported on a regular basis. Bloomberg Barclays Credit 13 Years Index is composed of publicly issued U.S. corporate and specified foreign debentures and secured notes that meet the specified maturity, liquidity, and quality requirements. To qualify, bonds must be SECregistered. Bloomberg Barclays Treasury Bellwethers 3 Month Index is composed of public obligations of the U. S. Treasury with a maturity of three months. Bloomberg Barclays US Agency Fixed Rate MBS Index covers the fixedrate mortgagebacked passthrough securities issued by GinnieMae (GNMA), Fannie Mae (FNMA), and Freddie Mae (FHLMC). Bloomberg Barclays US Treas TIPS Index consists of inflationprotected securities issued by the U.S. Treasury. Diversified Real Asset Strategic Index is composed of 35% Bloomberg Barclays U.S. Treasury TIPS Index, 20% S&P Global Infrastructure Index, 20% S&P Global Natural Resources Index, 15% Bloomberg Commodity Index, and 10% FTSE EPRA/NAREIT Developed Markets Index. FTSE EPRA/NAREIT Developed Index NR is designed to represent general trends in eligible real estate equities worldwide. MSCI ACWI Ex USA Index is a free floatadjusted market capitalization index that is designed to measure the combined equity market performance of developed and emerging market countries excluding the US. MSCI EAFE NR Index is listed for foreign stock funds (EAFE refers to Europe, Australia, and Far East). Widely accepted as a benchmark for international stock performance, the EAFE Index is an aggregate of 21 individual country indexes. MSCI EAFE Value Index is a subset of the MSCI EAFE Index, which is an unmanaged index that measures the stock returns of companies in developed economies outside of North America. The MSCI EAFE Value Index consists of securities classified by MSCI as most representing the value style. MSCI Emerging Markets NR Index measures equity market performance in the global emerging markets. It consists of 26 emerging market countries in Europe, Latin America and the Pacific Basin. MSCI US REIT Index is a capitalizationweighted benchmark index of most actively traded Real Estate Investment Trusts (REITs), designed to measure real estate performance. Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Preferreds Blended Index is composed of 50% BofA Merrill Lynch Fixed Rate Preferred Securities Index and 50% BofA Merrill Lynch U.S. Capital Securities Index. The blended index historic returns reflect the allocation as of the time of production. Previous allocation changes are not restated. Russell 1000 Growth Index is a marketcapitalization weighted index of those firms in the Russell 1000 with higher pricetobook ratios and higher forecasted growth values. Russell 1000 Value Index is a marketcapitalization weighted index of those firms in the Russell 1000 with lower pricetobook ratios and lower forecasted growth values. Russell 2000 Growth Index is a marketweighted total return index that measures the performance of companies within the Russell 2000 Index having higher pricetobook ratio and higher forecasted growth values. Russell 2000 Index consists of the smallest 2000 companies in the Russell 3000 Index, representing approximately 10% of the Russell 3000 total market capitalization. Russell 2000 Value Index is a marketweighted total return index that measures the performance of companies within the Russell 2000 Index having lower pricetobook ratios and lower forecasted growth values. Russell Midcap Growth Index is a marketweighted total return index that measures the performance of companies within the Russell Midcap Index having higher pricetobook ratios and higher forecasted growth values. Russell Midcap Index includes firms 201 through 1000, based on market capitalization, from the Russell 3000 Index. Russell Midcap Value Index is a marketweighted total return index that measures the performance of companies within the Russell Midcap index having lower pricetobook ratios and lower forecasted growth values. S&P Target Date 2010 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date 2015 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date 2020 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date 2025 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date 2030 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date 2035 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date 2040 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date 2045 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date 2050 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

S&P Target Date 2055 Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. S&P Target Date Retirement Income Index provides varying levels of exposure to equities and fixed income. Each target date allocation is created and retired according to a predetermined schedule related to the respective target date. SAM Balanced Blended Index is composed of 15% MSCI EAFE Index, 45% Russell 3000 Index and 40% Bloomberg Barclays Aggregate Bond Index. SAM Conservative Balanced Blended Index is composed of 10% MSCI EAFE Index, 30% Russell 3000 Index and 60% Bloomberg Barclays Aggregate Bond Index. SAM Conservative Growth Blended Index is composed of 20% MSCI EAFE Index, 60% Russell 3000 Index and 20% Bloomberg Barclays Aggregate Bond Index. SAM Flexible Income Blended Index is composed of 5% MSCI EAFE Index, 20% Russell 3000 Index and 75% Bloomberg Barclays Aggregate Bond Index. SAM Strategic Growth Blended Index is composed of 25% MSCI EAFE Index, 70% Russell 3000 Index and 5% Bloomberg Barclays Aggregate Bond Index. Standard & Poor's 400 MidCap Stock Index includes approximately 10% of the capitalization of U.S. equity securities. These are comprised of stocks in the middle capitalization range. Standard & Poor's 500 Index is a market capitalizationweighted index of 500 widely held stocks often used as a proxy for the stock market. Standard & Poor's 600 Stock Index is a small cap index that consists of 600 domestic stocks chosen for market size, liquidity, and industry group representation. The Russell 3000 Index is constructed to provide a comprehensive barometer of the broad market and accounts for nearly 98% of the total value of all equity traded on the U.S. exchanges. It measures the stocks that are also members of either the Russell 1000 or the Russell 2000 indexes. Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,

Glossary of Terms 7 Day Yield The 7Day Yield % more closely reflects the current earnings of this money market investment option than the total return displayed. Category Average Return Morningstar takes the average return of the funds that exist in a category for the time period and divide by the number of funds that exist for that time period. For calendar year category average returns, Morningstar includes funds that have merged, liquidated, or changed categories when calculating category averages. Total Investment Expense Gross The maximum expense ratio that can be applied to an investment option. This includes expenses and management fees, including 12b1 fees, administrative fees, and all other assetbased costs incurred by the investment option, except brokerage costs. Total Investment Expense Net Gross expense ratio less any fee waivers, reimbursements or caps. The expenses, as a percentage of net assets, actually borne by the fund. Investment performance results are always net of expense ratios. Expense Waiver The investment advisor can waive a portion of their management fees resulting in a lower net investment expense ratio. Contractual Cap A contractual agreement between the investment advisor and the fund to limit, as a percentage of net assets, the expenses borne by the fund. Date Date on which the investment option began its operations. Morningstar Category The Morningstar Category identifies investment options based on their actual investment styles as measured by their underlying portfolio holdings (portfolio statistics and compositions over the past three years). Percentile Rankings Each investment s total returns are compared to other investments in the same Morningstar category for various time periods. Total returns are ranked on a scale from 1 to 100 where 1 represents the highestreturning 1% of investments and 100 represents the lowest returning investments. Investment Advisor May include Registered Investment Advisers as defined in the Advisers Act of 1940, Investment Advisers as defined in the Investment Company Act of 1940, as well as a company employed by the investment option's advisor to handle the investment option's daytoday management. In these instances, the portfolio manager generally works for the fund's subadvisor, and not the advisor. See definition of Multiple SubAdvisor appearing elsewhere in this presentation for greater detail about SubAdvisors. Principal Funds R5, Principal Stable Value, Principal Trust Target CIT's, Principal Fixed Income Guaranteed Option,