Principal Management Corporation

A member of Principal Financial Group

711 High Street, Des Moines, IA 50392

515 247 5111 tel

www.principal.com

March 31, 2016

Mr. Michael Beer, President

Principal Funds, Inc.

Principal Financial Group

Des Moines, IA 50392-2080

Dear Mr. Beer:

Principal Management Corporation intends to purchase the following shares (the “Shares”):

Principal Funds, Inc. -	Purchase Amount	Shares Purchased
Multi-Manager Equity Long/Short Fund A	$10,000	1,000
Multi-Manager Equity Long/Short Fund Institutional	$10,000	1,000
Multi-Manager Equity Long/Short Fund P	$10,000	1,000
Multi-Manager Equity Long/Short Fund R6	$10,000	1,000

Each share of the Multi-Manager Equity Long/Short Fund has a par value of $.01 and a price of $10.00 per share. In connection with such purchase, Principal Management Corporation represents and warrants that it will purchase such Shares as an investment and not with a view to resell, distribute or redeem.

PRINCIPAL MANAGEMENT CORPORATION

BY _ /s/ Adam U. Shaikh___________________

Adam U. Shaikh

Counsel