December 28, 2012

Ms. Nora Everett, President

Principal Funds, Inc.

Principal Financial Group

Des Moines, IA 50392-2080

Dear Ms. Everett

Principal Financial Services, Inc. intends to purchase the following shares (the “Shares”):

Principal Funds, Inc. -	Purchase Amount		Shares Purchased
Global Opportunities Fund – Institutional Class		$5,000,000	500,000

Each share of the Global Opportunities Fund has a par value of $0.01 and a price of $10 per share. In connection with such purchase, Principal Financial Services, Inc. represents and warrants that it will purchase such Shares as an investment and not with a view to resell, distribute or redeem.

PRINCIPAL FINANCIAL SERVICES, INC.

BY _____/s/ Michael D. Roughton______________

Michael D. Roughton

Vice President and Associate General Counsel