THE SECURITIES ACT OF 1933
|
X
|
Post-Effective Amendment No. 64
|
X
|
THE INVESTMENT COMPANY ACT OF 1940
|
X
|
Amendment No. 66
|
X
|
(Check Appropriate Box or Boxes)
|
|
Name and Address of Agent for Service:
|
Britney L. Schnathorst
|
Principal Financial Group
|
Des Moines, IA 50392
|
|
____
|
This post-effective amendment designates a new effective date for a previously filed post-effective amendment.
|
Fund
|
Ticker Symbol
|
Principal U.S. Listing Exchange
|
Principal Investment Grade Corporate Active ETF
|
IG
|
NYSE Arca
|
|
|
FUND SUMMARY
|
|
PRINCIPAL INVESTMENT GRADE CORPORATE ACTIVE ETF
|
|
ADDITIONAL INFORMATION ABOUT INVESTMENT STRATEGIES AND RISKS
|
|
PORTFOLIO HOLDINGS INFORMATION
|
|
MANAGEMENT OF THE FUNDS
|
|
DISTRIBUTOR AND OTHER FUND SERVICE PROVIDERS
|
|
PRICING OF FUND SHARES
|
|
PURCHASE AND SALE OF FUND SHARES
|
|
DIVIDENDS AND DISTRIBUTIONS
|
|
FREQUENT PURCHASES AND REDEMPTIONS
|
|
TAX CONSIDERATIONS
|
|
DISTRIBUTION PLANS AND INTERMEDIARY COMPENSATION
|
|
FUND ACCOUNT INFORMATION
|
|
APPENDIX A - DESCRIPTION OF BOND RATINGS
|
|
ADDITIONAL INFORMATION
|
Management Fees
|
0.26%
|
Other Expenses
|
—%
|
Total Annual Fund Operating Expenses
(1)
|
0.26%
|
(1)
|
The investment management agreement (the “Management Agreement”) between the Fund and Principal Global Investors, LLC (“PGI”) provides that, for the duration of the Management Agreement, PGI will pay all operating expenses of the Fund, except for the Management Fee, payments made under each Series 12b-1 plan (if or when such fees are imposed), brokerage commissions and other expenses connected to the execution of portfolio transactions, interest expense, taxes, acquired fund fees and expenses, litigation expenses and other extraordinary expenses.
|
|
1 year
|
3 years
|
Principal Investment Grade Corporate Active ETF
|
$27
|
$84
|
•
|
Credit Default Swaps
. Credit default swaps involve special risks in addition to those associated with swaps generally because they are difficult to value, are highly susceptible to liquidity and credit risk, and generally pay a return to the party that has paid the premium only in the event of an actual default by the issuer of the underlying obligation (as opposed to a credit downgrade or other indication of financial difficulty). The protection “buyer” in a credit default contract may be obligated to pay the protection “seller” an up-front payment or a periodic stream of payments over the term of the contract provided generally that no credit event on a reference obligation has occurred. If a credit event occurs, the seller generally must pay the buyer the “par value” (i.e., full notional value) of the swap in exchange for an equal face amount of deliverable obligations of the reference entity described in the swap, or the seller may be required to deliver the related net cash amount, if the swap is cash settled. The Fund may be either the buyer or seller in the transaction.
|
•
|
Futures
. Futures contracts involve specific risks, including: the imperfect correlation between the change in market value of the instruments held by the fund and the price of the futures contract; possible lack of a liquid secondary market for a futures contract and the resulting inability to close a futures contract when desired; counterparty risk; and if the fund has insufficient cash, it may have to sell securities from its portfolio to meet daily variation margin requirements.
|
•
|
John R. Friedl (since 2018), Portfolio Manager
|
•
|
Paul S. Kim (since 2018), Portfolio Manager
|
•
|
Daniela Spassova (since 2018), Portfolio Manager
|
•
|
Timothy Warrick (since 2018), Portfolio Manager
|
INVESTMENT STRATEGIES AND RISKS
|
Principal Investment Grade Corporate Active ETF
|
Contingent Convertible Securities
|
Non-Principal
|
Counterparty Risk
|
Principal
|
Derivatives
|
Principal
|
Emerging Markets
|
Non-Principal
|
Fixed-Income Securities
|
Principal
|
Foreign Securities
|
Principal
|
Hedging
|
Principal
|
High Yield Securities
|
Non-Principal
|
Investment Company Securities
|
Principal
|
Market Trading Risks
|
Principal
|
Portfolio Duration
|
Principal
|
Portfolio Turnover (Active Trading)
|
Principal
|
Preferred Securities
|
Non-Principal
|
Real Estate Securities
|
Non-Principal
|
Redemption Risk
|
Principal
|
Securitized Products
|
Non-Principal
|
U.S. Government and U.S. Government-Sponsored Securities
|
Principal
|
•
|
The occurrence of a conversion event is inherently unpredictable and depends on many factors, some of which will be outside the issuer’s control. Because of the uncertainty regarding whether a conversion event will occur, it may be difficult to predict when, if at all, a CoCo will be converted to equity, and a fund may suffer losses as a result.
|
•
|
CoCos may have no stated maturity and fully discretionary coupons. This means coupon (i.e., interest) payments can be canceled at the banking institution’s discretion or at the request of the relevant regulatory authority in order to help the bank absorb losses, without causing a default.
|
•
|
CoCos are usually issued in the form of subordinated debt instruments to provide the appropriate regulatory capital treatment. If an issuer liquidates, dissolves or winds-up before a conversion to equity has occurred, the rights and claims of the holders of the CoCos (such as a fund) against the issuer generally rank junior to the claims of holders of unsubordinated obligations of the issuer. In addition, if the CoCos are converted into the issuer’s underlying equity securities after a conversion event (i.e., a “trigger”), each holder will be further subordinated.
|
•
|
The value of CoCos is unpredictable and is influenced by many factors including, without limitation: the creditworthiness of the issuer and/or fluctuations in such issuer’s applicable capital ratios; supply and demand for CoCos; general market conditions and available liquidity; and economic, financial and political events that affect the issuer, its particular market or the financial markets in general. Moreover, the performance of CoCos may be correlated with one another and as a result negative information of one issuer may cause decline in the value of CoCos of many other issuers.
|
•
|
increased volatility of a fund and/or the failure of the investment to mitigate volatility as intended;
|
•
|
the inability of those managing investments of the fund to predict correctly the direction of securities prices, interest rates, currency exchange rates, asset values, and other economic factors;
|
•
|
losses caused by unanticipated market movements, which may be substantially greater than a fund's initial investment and are potentially unlimited;
|
•
|
the possibility that there may be no liquid secondary market which may make it difficult or impossible to close out a position when desired;
|
•
|
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.
|
•
|
Commodity index-linked notes are derivative debt instruments issued by U.S. and foreign banks, brokerage firms, insurance companies and other corporations with principal and/or coupon payments linked to the performance of commodity indices. Commodities are assets that have tangible properties, such as oil, coal, natural gas, agricultural products, industrial metals, livestock and precious metals. These notes expose a fund to movements in commodity prices. They are also subject to credit, counterparty, and interest rate risk. Commodity index-linked notes are often leveraged, increasing the volatility of each note's market value relative to changes in the underlying commodity index. At the maturity of the note, a fund may receive more or less principal than it originally invested. A fund may also receive interest payments on the note that are less than the stated coupon interest payments.
|
•
|
Credit Default Swap Agreements may be entered into by a fund as a "buyer" or "seller" of credit protection. Credit default swap agreements involve special risks because they may be difficult to value, are highly susceptible to liquidity and credit risk, and generally pay a return to the party that has paid the premium only in the event of an actual default by the issuer of the underlying obligation (as opposed to a credit downgrade or other indication of
|
•
|
Foreign Currency Contracts (such as foreign currency options and foreign currency forward and swap agreements) may be used by funds to increase exposure to a foreign currency or to shift exposure to foreign currency fluctuations from one country to another. A forward currency contract involves a privately negotiated obligation to purchase or sell a specific currency at a future date at a price set in the contract. For currency contracts, there is also a risk of government action through exchange controls that would restrict the ability of a fund to deliver or receive currency.
|
•
|
Forwards, futures contracts and options thereon (including commodities futures); options (including put or call options); and swap agreements and over-the-counter swap agreements (e.g., interest rate swaps, total return swaps and credit default swaps) may be used by funds for hedging purposes in order to try to mitigate or protect against potential losses due to changing interest rates, securities prices, asset values, currency exchange rates, and other market conditions; non-hedging purposes to seek to increase the fund’s income or otherwise enhance return; and as a low-cost method of gaining exposure to a particular market without investing directly in those securities or assets. These derivative investments are subject to special risk considerations, particularly the imperfect correlation between the change in market value of the instruments held by a fund and the price of the derivative instrument. If a fund has insufficient cash, it may have to sell securities from its portfolio to meet daily variation margin requirements, even when it may be disadvantageous to do so. Options and Swap Agreements also involve counterparty risk. With respect to options, there may be difference in trading hours for the options markets and the markets for the underlying securities (rate movements can take place in the underlying markets that cannot be reflected in the options markets) and an insufficient liquid secondary market for particular options.
|
•
|
Index/structured securities. Certain derivative securities are described more accurately as index/structured securities, which are derivative securities whose value or performance is linked to other equity securities (such as depositary receipts), currencies, interest rates, indices, or other financial indicators (reference indices).
|
•
|
increased social, political, and economic instability;
|
•
|
a smaller market for these securities and low or nonexistent trading volume that results in a lack of liquidity and greater price volatility;
|
•
|
lack of publicly available information, including reports of payments of dividends or interest on outstanding securities;
|
•
|
foreign government policies that may restrict opportunities, including restrictions on investment in issuers or industries deemed sensitive to national interests;
|
•
|
relatively new capital market structure or market-oriented economy;
|
•
|
the possibility that recent favorable economic developments may be slowed or reversed by unanticipated political or social events in these countries;
|
•
|
restrictions that may make it difficult or impossible for the Fund to vote proxies, exercise shareholder rights, pursue legal remedies, and obtain judgments in foreign courts; and
|
•
|
possible losses through the holding of securities in domestic and foreign custodial banks and depositories.
|
•
|
Mortgage-backed securities (“MBS”) represent an interest in a pool of underlying mortgage loans secured by real property. MBS are sensitive to changes in interest rates, but may respond to these changes differently from other fixed income securities due to the possibility of prepayment of the underlying mortgage loans. If interest rates fall and the underlying loans are prepaid faster than expected, the fund may have to reinvest the prepaid principal in lower yielding securities, thus reducing the fund’s income. Conversely, rising interest rates tend to discourage refinancings and the underlying loans may be prepaid more slowly than expected, reducing a fund’s potential to reinvest the principal in higher yielding securities and extending the duration of the underlying loans. In addition, when market conditions result in an increase in default rates on the underlying loans and the foreclosure values of the underlying real estate is less than the outstanding amount due on the underlying loan, collection of the full amount of accrued interest and principal on these investments may be doubtful. The risk of such defaults is generally higher in the case of underlying mortgage pools that include sub-prime mortgages (mortgages granted to borrowers whose credit histories would not support conventional mortgages).
|
•
|
Commercial mortgage-backed securities (“CMBS”) represent an interest in a pool of underlying commercial mortgage loans secured by real property such as retail, office, hotel, multi-family, and industrial properties. Certain CMBS are issued in several classes with different levels of yield and credit protection, and the CMBS class in which a fund invests usually influences the interest rate, credit, and prepayment risks.
|
•
|
Asset-backed securities (“ABS”) are backed by non-mortgage assets such as company receivables, truck and auto loans, student loans, leases and credit card receivables. ABS entail credit risk. They also may present a risk that, in the event of default, the liquidation value of the underlying assets may be inadequate to pay any unpaid interest or principal.
|
Advisor:
|
Principal Global Investors, LLC ("PGI"),
711 High Street, Des Moines, IA 50392, is part of a diversified global asset management organization which utilizes a multi-boutique strategy of specialized investment groups and affiliates to provide institutional investors and individuals with diverse investment capabilities, including fixed income, equities, real estate, currency, asset allocation and stable value. PGI also has asset management offices of affiliate advisors in non-U.S. locations including London, Singapore, Tokyo, Hong Kong and Sydney. PGI has been an investment advisor since 1998.
|
Fund(s):
|
In fulfilling its investment advisory responsibilities, PGI also provides the day-to-day discretionary investment services (directly making decisions to purchase or sell securities) for the Principal Investment Grade Corporate Active ETF.
|
Fund
|
All Assets
|
Principal Investment Grade Corporate Active ETF
|
0.26%
|
|
Annual Report to Shareholders for the period ending June 30, 2018
|
Fund
|
Management Agreement
|
Principal Investment Grade Corporate Active ETF
|
X
|
•
|
hire one or more sub-advisors;
|
•
|
change sub-advisors; and
|
•
|
reallocate management fees between itself and sub-advisors.
|
•
|
If market quotations are not readily available for a security owned by the Fund, its fair value is determined using a policy adopted by the Trustees. Fair valuation pricing is subjective and creates the possibility that the fair value determined for a security may differ materially from the value that could be realized upon the sale of the security.
|
•
|
The Fund's securities may be traded on foreign securities markets that generally complete trading at various times during the day before the close of the NYSE. Foreign securities and currencies are converted to U.S. dollars using the exchange rate in effect at the close of the NYSE.
|
•
|
The trading of foreign securities generally or in a particular country or countries may not take place on all days the NYSE is open, or may trade on days the NYSE is closed. Thus, the value of the foreign securities held by the Fund may change on days when shareholders are unable to purchase or redeem shares.
|
•
|
Certain securities issued by companies in emerging market countries may have more than one quoted valuation at any point in time. These may be referred to as local price and premium price. The premium price is often a negotiated price that may not consistently represent a price at which a specific transaction can be effected. The Fund has a policy to value such securities at a price at which those managing the investments of the Fund expect the securities may be sold.
|
•
|
With respect to any portion of a Fund’s assets invested in other registered investment companies, that portion of the Fund's NAV is calculated based on the price (NAV or market, as applicable) of such other registered investment
companies
.
|
Note:
|
No salesperson, broker-dealer, or other person is authorized to give information or make representations about the Fund other than those contained in this Prospectus. Information or representations not contained in this prospectus may not be relied upon as having been provided or made by the Trust, the Fund, PGI, any Sub-Advisor, or the Distributor.
|
•
|
the Fund makes distributions,
|
•
|
you sell your Shares listed on the exchange, and
|
•
|
you purchase or redeem Creation Units.
|
Aaa:
|
Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit risk.
|
Aa:
|
Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.
|
A:
|
Obligations rated A are considered upper-medium grade and are subject to low credit risk.
|
Baa:
|
Obligations rated Baa are subject to moderate credit risk. They are considered medium-grade and as such may possess certain speculative characteristics.
|
Ba:
|
Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.
|
B:
|
Obligations rated B are considered speculative and are subject to high credit risk.
|
Caa:
|
Obligations rated Caa are judged to be speculative of poor standing and are subject to very high credit risk.
|
Ca:
|
Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest.
|
C:
|
Obligations rated C are the lowest rated class of bonds and are typically in default, with little prospect for recovery of principal or interest.
|
•
|
Likelihood of payment - capacity and willingness of the obligor to meet its financial commitment on an obligation in accordance with the terms of the obligation;
|
•
|
Nature of and provisions of the obligation;
|
•
|
Protection afforded by, and relative position of, the obligation in the event of bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditor's rights.
|
AAA:
|
Obligations rated ‘AAA’ have the highest rating assigned by S&P Global. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong.
|
AA:
|
Obligations rated ‘AA’ differ from the highest-rated issues only in small degree. The obligor’s capacity to meet its financial commitment on the obligation is very strong.
|
A:
|
Obligations rated ‘A’ have a strong capacity to meet financial commitment on the obligation although they are somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories.
|
BBB:
|
Obligations rated ‘BBB’ exhibit adequate protection parameters; however, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to meet financial commitment on the obligation.
|
BB, B, CCC,
|
Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded, on balance, as having significant
|
CC, and C:
|
speculative characteristics. ‘BB’ indicates the lowest degree of speculation and ‘C’ the highest degree of speculation. While such obligations will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major risk exposures to adverse conditions.
|
BB:
|
Obligations rated ‘BB’ are less vulnerable to nonpayment than other speculative issues. However it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to the obligor’s inadequate capacity to meet its financial commitment on the obligation.
|
B:
|
Obligations rated ‘B’ are more vulnerable to nonpayment than ‘BB’ but the obligor currently has the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic conditions will likely impair this capacity.
|
CCC:
|
Obligations rated ‘CCC’ are currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation. If adverse business, financial, or economic conditions occur, the obligor is not likely to have the capacity to meet its financial commitment on the obligation.
|
CC:
|
Obligations rated ‘CC’ are currently highly vulnerable to nonpayment. The ‘CC’ rating is used when a default has not yet occurred but S&P Global expects default to be a virtual certainty, regardless of anticipated time to default.
|
C:
|
The rating ‘C’ is highly vulnerable to nonpayment, the obligation is expected to have lower relative seniority or lower ultimate recovery compared to higher rated obligations.
|
D:
|
Obligations rated ‘D’ are in default, or in breach of an imputed promise. For non-hybrid capital instruments, the ‘D’ rating category is used when payments on an obligation are not made on the date due, unless S&P Global believes that such payments will be made within five business days in the absence of a stated grace period or within the earlier of the stated grace period or 30 calendar days. The rating will also be used upon filing for bankruptcy petition or the taking of similar action and where default is a virtual certainty. If an obligation is subject to a distressed exchange offer the rating is lowered to ‘D’.
|
NR:
|
Indicates that no rating has been requested, that there is insufficient information on which to base a rating or that S&P Global does not rate a particular type of obligation as a matter of policy.
|
A-1:
|
This is the highest category. The obligor’s capacity to meet its financial commitment on the obligation is strong. Within this category, certain obligations are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial commitment on these obligations is extremely strong.
|
A-2:
|
Issues carrying this designation are somewhat more susceptible to the adverse effects of the changes in circumstances and economic conditions than obligations in higher rating categories. However, the obligor’s capacity to meet its financial commitment on the obligation is satisfactory.
|
A-3:
|
Issues carrying this designation exhibit adequate capacity to meet their financial obligations. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet it financial commitment on the obligation.
|
B:
|
Issues rated ‘B’ are regarded as vulnerable and have significant speculative characteristics. The obligor has capacity to meet financial commitments; however, it faces major ongoing uncertainties which could lead to obligor’s inadequate capacity to meet its financial obligations.
|
C:
|
This rating is assigned to short-term debt obligations that are currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions to meet its financial commitment on the obligation.
|
D:
|
This rating indicates that the issue is either in default or in breach of an imputed promise. For non-hybrid capital instruments, the ‘D’ rating category is used when payments on an obligation are not made on the date due, unless S&P Global believes that such payments will be made within five business days in the absence of a stated grace period or within the earlier of the stated grace period or 30 calendar days. The rating will also be used upon filing for bankruptcy petition or the taking of similar action and where default is a virtual certainty. If an obligation is subject to a distressed exchange offer the rating is lowered to ‘D’.
|
SP-1:
|
A strong capacity to pay principal and interest. Issues that possess a very strong capacity to pay debt service is given a "+" designation.
|
SP-2:
|
A satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and economic changes over the terms of the notes.
|
SP-3:
|
A speculative capacity to pay principal and interest.
|
AAA:
|
Highest credit quality. ‘AAA’ ratings denote the lowest expectation of credit risk. They are assigned only in case of exceptionally strong capacity for payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.
|
AA:
|
Very high credit quality. ‘AA’ ratings denote expectations of very low credit risk. They indicate very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.
|
A:
|
High credit quality. ‘A’ ratings denote low expectation of credit risk. The capacity for timely payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to adverse business or economic conditions than is the case for higher ratings.
|
BBB:
|
Good credit quality. ‘BBB’ ratings indicate that expectations of credit risk are currently low. The capacity for payment of financial commitments is considered adequate, but adverse business or economic conditions are more likely to impair this capacity.
|
BB:
|
Speculative. ‘BB’ ratings indicate an elevated vulnerability to credit risk, particularly in the event of adverse changes in business or economic conditions over time; however, business or financial alternatives may be available to allow financial commitments to be met.
|
B:
|
Highly speculative. ‘B’ ratings indicate that material credit risk is present.
|
CCC:
|
Substantial credit risk. ‘CCC’ ratings indicate that substantial credit risk is present.
|
CC:
|
Very high levels of credit risk. ‘CC’ ratings indicate very high levels of credit risk.
|
C:
|
Exceptionally high levels of credit risk. ‘C’ indicates exceptionally high levels of credit risk.
|
D:
|
Default. ‘D’ ratings indicate an issuer has entered into bankruptcy filings, administration, receivership, liquidation or which has otherwise ceased business.
|
F1:
|
Highest short-term credit quality. Indicates the strongest intrinsic capacity for timely payment of financial commitments; may have an added “+” to denote any exceptionally strong credit feature.
|
F2:
|
Good short-term credit quality. Good intrinsic capacity for timely payment of financial commitments.
|
F3:
|
Fair short-term credit quality. The intrinsic capacity for timely payment of financial commitments is adequate.
|
B:
|
Speculative short-term credit quality. Minimal capacity for timely payment of financial commitments, plus heightened vulnerability to near term adverse changes in financial and economic conditions.
|
C:
|
High short-term default risk. Default is a real possibility.
|
RD:
|
Restricted default. Indicates an entity that has defaulted on one or more of its financial commitments, although it continues to meet other financial obligations. Typically applicable to entity ratings only.
|
D:
|
Default. Indicates a broad-based default event for an entity, or the default of a specific short-term obligation.
|
RR1:
|
Outstanding recovery prospects given default. ‘RR1’ rated securities have characteristics consistent with securities historically recovering 91%-100% of current principal and related interest.
|
RR2:
|
Superior recovery prospects given default. ‘RR2’ rated securities have characteristics consistent with securities historically recovering 71%-90% of current principal and related interest.
|
RR3:
|
Good recovery prospects given default. ‘RR3’ rated securities have characteristics consistent with securities historically recovering 51%-70% of current principal and related interest.
|
RR4:
|
Average recovery prospects given default. ‘RR4’ rated securities have characteristics consistent with securities historically recovering 31%-50% of current principal and related interest.
|
RR5:
|
Below average recovery prospects given default. ‘RR5’ rated securities have characteristics consistent with securities historically recovering 11%-30% of current principal and related interest.
|
RR6:
|
Poor recovery prospects given default. ‘RR6’ rated securities have characteristics consistent with securities historically recovering 0%-10% of current principal and related interest.
|
Fund
|
Ticker Symbol
|
Principal U.S. Listing Exchange
|
Principal Active Global Dividend Income ETF
|
GDVD
|
Cboe BZX Exchange, Inc.
|
Principal EDGE Active Income ETF
|
YLD
|
NYSE Arca
|
Principal Healthcare Innovators Index ETF
|
BTEC
|
The Nasdaq Stock Market LLC
|
Principal Investment Grade Corporate Active ETF
|
IG
|
NYSE Arca
|
Principal Millennials Index ETF
|
GENY
|
The Nasdaq Stock Market LLC
|
Principal Price Setters Index ETF
|
PSET
|
The Nasdaq Stock Market LLC
|
Principal Shareholder Yield Index ETF
|
PY
|
The Nasdaq Stock Market LLC
|
Principal Spectrum Preferred Securities Active ETF
|
PREF
|
Cboe BZX Exchange, Inc.
|
Principal U.S. Small-Cap Multi-Factor Index ETF
|
PSC
|
The Nasdaq Stock Market LLC
|
TABLE OF CONTENTS
|
|
GENERAL DESCRIPTION OF TRUST AND FUNDS
|
|
EXCHANGE LISTING AND TRADING
|
|
DESCRIPTION OF THE FUNDS' INVESTMENTS AND RISKS
|
|
LEADERSHIP STRUCTURE AND BOARD OF TRUSTEES
|
|
INVESTMENT ADVISORY AND OTHER SERVICES
|
|
INTERMEDIARY COMPENSATION
|
|
PURCHASE AND REDEMPTION OF CREATION UNITS
|
|
CALCULATION OF NAV
|
|
TAX CONSIDERATIONS
|
|
PORTFOLIO HOLDINGS DISCLOSURE
|
|
PROXY VOTING POLICIES AND PROCEDURES
|
|
FINANCIAL STATEMENTS
|
|
INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
|
|
CONTROL PERSONS AND PRINCIPAL HOLDERS OF SECURITIES
|
|
PORTFOLIO MANAGER DISCLOSURE
|
|
APPENDIX A – DESCRIPTION OF BOND RATINGS
|
|
APPENDIX B – FOREIGN MARKET HOLIDAYS
|
|
APPENDIX C – PROXY VOTING POLICIES
|
Fund
|
Principal U.S. Listing Exchange
|
Principal Active Global Dividend Income ETF
|
Cboe BZX Exchange, Inc.
|
Principal EDGE Active Income ETF
|
NYSE Arca
|
Principal Healthcare Innovators Index ETF
|
The Nasdaq Stock Market LLC
|
Principal Investment Grade Corporate Active ETF
|
NYSE Arca
|
Principal Millennials Index ETF
|
The Nasdaq Stock Market LLC
|
Principal Price Setters Index ETF
|
The Nasdaq Stock Market LLC
|
Principal Shareholder Yield Index ETF
|
The Nasdaq Stock Market LLC
|
Principal Spectrum Preferred Securities Active ETF
|
Cboe BZX Exchange, Inc.
|
Principal U.S. Small-Cap Multi-Factor Index ETF
|
The Nasdaq Stock Market LLC
|
1)
|
May not issue senior securities, except as permitted under the 1940 Act, as amended, and as interpreted, modified or otherwise permitted by regulatory authority having jurisdiction, from time to time.
|
2)
|
May not purchase or sell commodities, except as permitted under the 1940 Act, as amended, and as interpreted, modified or otherwise permitted by regulatory authority having jurisdiction, from time to time.
|
3)
|
May not purchase or sell real estate, which term does not include securities of companies which deal in real estate or mortgages or investments secured by real estate or interests therein, except that the Fund reserves freedom of action to hold and to sell real estate acquired as a result of the Fund’s ownership of securities.
|
4)
|
May not borrow money, except as permitted under the 1940 Act, as amended, and as interpreted, modified or otherwise permitted by regulatory authority having jurisdiction, from time to time.
|
5)
|
May not make loans except as permitted under the 1940 Act, as amended, and as interpreted, modified or otherwise permitted by regulatory authority having jurisdiction, from time to time.
|
6)
|
Has elected to be treated as a “diversified” investment company, as that term is used in the 1940 Act, as amended, and as interpreted, modified or otherwise permitted by regulatory authority having jurisdiction, from time to time.
|
7)
|
Has adopted a concentration policy as follows:
|
a.
|
The Principal Spectrum Preferred Securities Active ETF concentrates its investments in securities in the financial services (i.e., banking, insurance and commercial finance) industry.
|
b.
|
Each index ETF will not concentrate its investments in a particular industry except to the extent its underlying index is so concentrated. Given the present composition of its underlying index, the Principal Healthcare Innovators Index ETF expects to have more than 25% of its assets invested in the healthcare industry.
|
c.
|
Each of the remaining Funds may not concentrate, as that term is used in the 1940 Act, its investments in a particular industry, except as permitted under the 1940 Act, as amended, and as interpreted, modified or otherwise permitted by regulatory authority having jurisdiction, from time to time.
|
8)
|
May not act as an underwriter of securities, except to the extent that the Fund may be deemed to be an underwriter in connection with the sale of securities held in its portfolio.
|
1)
|
Invest more than 15% of its net assets in illiquid securities and in repurchase agreements maturing in more than seven days except to the extent permitted by applicable law or regulatory authority having jurisdiction, from time to time.
|
2)
|
Pledge, mortgage, or hypothecate its assets, except to secure permitted borrowings. The deposit of underlying securities and other assets in escrow and other collateral arrangements in connection with transactions that involve any future payment obligation, as permitted under the 1940 Act, as amended, and as interpreted, modified or otherwise permitted by any regulatory authority having jurisdiction, from time to time, are not deemed to be pledges, mortgages, hypothecations, or other encumbrances.
|
3)
|
Invest in companies for the purpose of exercising control or management.
|
4)
|
Acquire securities of other investment companies in reliance on Section 12(d)(1)(F) or (G) of the 1940 Act, invest more than 10% of its total assets in securities of other investment companies, invest more than 5% of its total assets in the securities of any one investment company, or acquire more than 3% of the outstanding voting securities of any one investment company except in connection with a merger, consolidation, or plan of reorganization and except as permitted by the 1940 Act, SEC rules adopted under the 1940 Act or exemptions granted by the Securities and Exchange Commission. The Fund may purchase securities of closed-end investment companies in the open market where no underwriter or dealer’s commission or profit, other than a customary broker’s commission, is involved.
|
1)
|
Invest more than 5% of its total assets in real estate limited partnership interests.
|
•
|
Principal Active Global Dividend Income ETF
|
•
|
Principal EDGE Active Income ETF
|
•
|
Principal Healthcare Innovators Index ETF
|
•
|
Principal Investment Grade Corporate Active ETF
|
•
|
Principal Millennials Index ETF
|
•
|
Principal Price Setters Index ETF
|
•
|
Principal Shareholder Yield Index ETF
|
•
|
Principal Spectrum Preferred Securities Active ETF
|
•
|
Principal U.S. Small-Cap Multi-Factor Index ETF
|
•
|
foreign currency investments, each Fund will count forward foreign currency contracts and other investments that have economic characteristics similar to foreign currency; the value of such contracts and investments will include the Fund’s investments in cash and/or cash equivalents to the extent such instruments are used to cover the Fund’s exposure under its forward foreign currency contracts and similar investments.
|
•
|
derivatives instruments, each Fund will typically count the mark-to-market value of such derivatives. However, the Fund may use a derivative contract’s notional value when it determines that notional value is an appropriate measure of the Fund’s exposure to investments. For example, with respect to single name equity swaps which are “fully paid” (equity swaps in which cash and/or cash equivalents are specifically segregated on the Fund’s books for the purpose of covering the full notional value of the swap), each Fund will count the value of such cash and/or cash equivalents.
|
•
|
investments in underlying funds (including ETFs), each Fund will count all investments in an underlying fund toward the requirement as long as 80% of the value of such underlying fund's holdings focus on the particular type of investment suggested by the Fund name.
|
•
|
American Depositary Receipts ("ADRs") - receipts issued by an American bank or trust company evidencing ownership of underlying securities issued by a foreign issuer. They are designed for use in U.S. securities markets.
|
•
|
European Depositary Receipts ("EDRs") and Global Depositary Receipts ("GDRs") - receipts typically issued by a foreign financial institution to evidence an arrangement similar to that of ADRs.
|
•
|
Exchange-Traded Options. An exchange-traded option may be closed out only on an exchange that generally provides a liquid secondary market for an option of the same series. If a liquid secondary market for an exchange-traded option does not exist, it might not be possible to effect a closing transaction with respect to a particular option, with the result that a Fund would have to exercise the option in order to consummate the transaction.
|
•
|
Over the Counter ("OTC") Options. OTC options differ from exchange-traded options in that they are two-party contracts, with price and other terms negotiated between buyer and seller, and generally do not have as much market liquidity as exchange-traded options. An OTC option (an option not traded on an established exchange) may be closed out only by agreement with the other party to the original option transaction. With OTC options, a Fund is at risk that the other party to the transaction will default on its obligations or will not permit the Fund to terminate the transaction before its scheduled maturity. While a Fund will seek to enter into OTC options only with dealers who agree to or are expected to be capable of entering into closing transactions with a Fund, there can be no assurance that a Fund will be able to liquidate an OTC option at a favorable price at any time prior to its expiration. OTC options are not subject to the protections afforded purchasers of listed options by the Options Clearing Corporation or other clearing organizations. An exchange-traded option may be closed out only on an exchange that generally provides a liquid secondary market for an option of the same series. If a liquid secondary market for an exchange-traded option does not exist, it might not be possible to effect a closing transaction with respect to a particular option, with the result that a fund would have to exercise the option in order to consummate the transaction.
|
•
|
Interest Rate Swaps. Interest rate swaps involve the exchange by a Fund with another party of their respective commitments to pay or receive interest (for example, an exchange of floating rate payments for fixed rate payments with respect to a notional amount of principal).
Forms of swap agreements also include interest rate caps, under which, in return for a premium, one party agrees to make payments to the other to the extent that interest rates exceed a specified rate, or "cap"; interest rate floors, under which, in return for a premium, one party agrees to make payments to the other to the extent that interest rates fall below a specified rate, or "floor"; and interest rate collars, under which a party sells a cap and purchases a floor or vice versa in an attempt to protect itself against interest rate movements exceeding given minimum or maximum levels.
|
•
|
Currency Swaps. A currency swap is an agreement to exchange cash flows on a notional amount based on changes in the relative values of the specified currencies.
|
•
|
Index Swaps. An index swap is an agreement to make or receive payments based on the different returns that would be achieved if a notional amount were invested in a specified basket of securities (such as the S&P 500 Index) or in some other investment (such as U.S. Treasury Securities).
|
•
|
Total Return Swaps. A total return swap is an agreement to make payments of the total return from a specified asset or instrument (or a basket of such instruments) during the specified period, in return for payments equal to a fixed or floating rate of interest or the total return from another specified asset or instrument. Alternatively, a total return swap can be structured so that one party will make payments to the other party if the value of the relevant asset or instrument increases, but receive payments from the other party if the value of that asset or instrument decreases.
|
•
|
Commodity Swap Agreements. Consistent with a Fund's investment objectives and general investment policies, certain of the Funds may invest in commodity swap agreements. For example, an investment in a commodity swap agreement may involve the exchange of floating-rate interest payments for the total return on a commodity index. In a total return commodity swap, a Fund will receive the price appreciation of a commodity index, a portion of the index, or a single commodity in exchange for paying an agreed-upon fee. If the commodity swap is for one period, the Fund may pay a fixed fee, established at the outset of the swap. However, if the term of the commodity swap is for more than one period, with interim swap payments, the Fund may pay an adjustable or floating fee. With a "floating" rate, the fee may be pegged to a base rate, such as the London Interbank Offered Rate, and is adjusted each period. Therefore, if interest rates increase over the term of the swap contract, the Fund may be required to pay a higher fee at each swap reset date.
|
•
|
Credit Default Swap Agreements. The "buyer" in a credit default contract is obligated to pay the "seller" a periodic stream of payments over the term of the contract provided that no event of default on an underlying reference obligation has occurred. If an event of default occurs, the seller must pay the buyer the full notional value, or "par value," of the reference obligation in exchange for the reference obligation. A Fund may be either the buyer or seller in a credit default swap transaction. If the Fund is a buyer and no event of default occurs, the Fund will lose its investment and recover nothing. However, if an event of default occurs, the Fund (if the buyer) will receive the full notional value of the reference obligation that may have little or no value. As a seller, the Fund receives a fixed rate of income throughout the term of the contract, which typically is between six months and five years, provided that there is no default event. If an event of default occurs, the seller must pay the buyer the full notional value of the reference obligation. In addition, collateral posting requirements are individually negotiated and there is no
|
•
|
Investment Pools. Each Fund may invest in publicly or privately issued interests in investment pools whose underlying assets are credit default, credit-linked, interest rate, currency exchange, equity-linked or other types of swap contracts and related underlying securities or securities loan agreements. The pools’ investment results may be designed to correspond generally to the performance of a specified securities index or “basket” of securities, or sometimes a single security. These types of pools are often used to gain exposure to multiple securities with a smaller investment than would be required to invest directly in the individual securities. They also may be used to gain exposure to foreign securities markets without investing in the foreign securities themselves and/or the relevant foreign market. To the extent that a Fund invests in pools of swaps and related underlying securities or securities loan agreements whose return corresponds to the performance of a foreign securities index or one or more foreign securities, investing in such pools will involve risks similar to the risks of investing in foreign securities. In addition to the risks associated with investing in swaps generally, a Fund bears the risks and costs generally associated with investing in pooled investment vehicles, such as paying the fees and expenses of the pool and the risk that the pool or the operator of the pool may default on its obligations to the holder of interests in the pool, such as a Fund. Interests in privately offered investment pools of swaps may be considered illiquid.
|
•
|
Contracts for Differences. “Contracts for differences” are swap arrangements in which a Fund may agree with a counterparty that its return (or loss) will be based on the relative performance of two different groups or “baskets” of securities. For example, as to one of the baskets, a Fund’s return is based on theoretical long futures positions in the securities comprising that basket, and as to the other basket, the Fund’s return is based on theoretical short futures positions in the securities comprising that other basket. The notional sizes of the baskets will not necessarily be the same, which can give rise to investment leverage. Each Fund may also use actual long and short futures positions to achieve the market exposure(s) as contracts for differences. Each Fund may enter into swaps and contracts for differences for investment return, hedging, risk management and for investment leverage.
|
•
|
Swaptions. A swap option (also known as “swaptions”) is a contract that gives a counterparty the right (but not the obligation) in return for payment of a premium, to enter into a new swap agreement or to shorten, extend, cancel, or otherwise modify an existing swap agreement, at some designated future time on specified terms. The buyer and seller of the swap option agree on the strike price, length of the option period, the term of the swap, notional amount, amortization and frequency of settlement. Each Fund may engage in swap options for hedging purposes or in an attempt to manage and mitigate credit and interest rate risk. Each Fund may write (sell) and purchase put and call swap options. The use of swap options involves risks, including, among others, imperfect correlation between movements of the price of the swap options and the price of the securities, indices or other assets serving as reference instruments for the swap option, reducing the effectiveness of the instrument for hedging or investment purposes.
|
•
|
the frequency of trades and quotations,
|
•
|
the number of dealers and prospective purchasers in the marketplace,
|
•
|
dealer undertakings to make a market,
|
•
|
the nature of the security (including any demand or tender features), and
|
•
|
the nature of the marketplace for trades (including the ability to assign or offset a portfolio's rights and obligations relating to the investment).
|
•
|
Bank Notes are notes issued by local governmental bodies and agencies such as those described above to commercial banks as evidence of borrowings. The purposes for which the notes are issued are varied but they are frequently issued to meet short-term working-capital or capital-project needs. These notes may have risks similar to the risks associated with TANs and RANs.
|
•
|
Bond Anticipation Notes ("BANs") are usually general obligations of state and local governmental issuers which are sold to obtain interim financing for projects that will eventually be funded through the sale of long-term debt obligations or bonds. The ability of an issuer to meet its obligations on its BANs is primarily dependent on the issuer's access to the long-term municipal bond market and the likelihood that the proceeds of such bond sales will be used to pay the principal and interest on the BANs.
|
•
|
Construction Loan Notes are issued to provide construction financing for specific projects. Permanent financing, the proceeds of which are applied to the payment of construction loan notes, is sometimes provided by a commitment by the Government National Mortgage Association ("GNMA") to purchase the loan, accompanied by a commitment by the Federal Housing Administration to insure mortgage advances thereunder. In other instances, permanent financing is provided by commitments of banks to purchase the loan.
|
•
|
Revenue Anticipation Notes ("RANs") are issued by governments or governmental bodies with the expectation that future revenues from a designated source will be used to repay the notes. In general they also constitute general obligations of the issuer. A decline in the receipt of projected revenues, such as anticipated revenues from another level of government, could adversely affect an issuer's ability to meet its obligations on outstanding RANs. In addition, the possibility that the revenues would, when received, be used to meet other obligations could affect the ability of the issuer to pay the principal and interest on RANs.
|
•
|
Tax Anticipation Notes ("TANs") are issued by state and local governments to finance the current operations of such governments. Repayment is generally to be derived from specific future tax revenues. TANs are usually general obligations of the issuer. A weakness in an issuer's capacity to raise taxes due to, among other things, a decline in its tax base or a rise in delinquencies, could adversely affect the issuer's ability to meet its obligations on outstanding TANs.
|
•
|
Traditional Preferred Securities. Traditional preferred securities may be issued by an entity taxable as a corporation and pay fixed or floating rate dividends. However, these claims are subordinated to more senior creditors, including senior debt holders. “Preference” means that a company must pay dividends on its preferred securities before paying any dividends on its common stock, and the claims of preferred securities holders are ahead of common stockholders’ claims on assets in a corporate liquidation. Holders of preferred securities usually have no right to vote for corporate directors or on other matters. Preferred securities share many investment characteristics with both common stock and bonds.
|
•
|
Hybrid or Trust Preferred Securities. Hybrid-preferred securities are debt instruments that have characteristics similar to those of traditional preferred securities (characteristics of both subordinated debt and preferred stock). Hybrid preferred securities may be issued by corporations, generally in the form of interest-bearing instruments with preferred securities characteristics, or by an affiliated trust or partnership of the corporation, generally in the form of preferred interests in subordinated business trusts or similarly structured securities. The hybrid-preferred securities market consists of both fixed and adjustable coupon rate securities that are either perpetual in nature or have stated maturity dates. Hybrid preferred holders generally have claims to assets in a corporate liquidation that are senior to those of traditional preferred securities but subordinate to those of senior debt holders. Certain subordinated debt and senior debt issues that have preferred characteristics are also considered to be part of the broader preferred securities market.
|
•
|
Floating rate preferred securities provide for a periodic adjustment in the interest rate paid on the securities. The terms of such securities provide that interest rates are adjusted periodically based upon an interest rate adjustment index. The adjustment intervals may be regular, and range from daily up to annually, or may be event-based, such as a change in the short-term interest rate. Because of the interest rate reset feature, floating rate securities provide a Fund with a certain degree of protection against rising interest rates, although the interest rates of floating rate securities will participate in any declines in interest rates as well.
|
•
|
U.S. Government Securities - Securities issued or guaranteed by the U.S. government, including treasury bills, notes, and bonds.
|
•
|
U.S. Government Agency Securities - Obligations issued or guaranteed by agencies or instrumentalities of the U.S. government.
|
•
|
U.S. agency obligations include, but are not limited to, the Bank for Cooperatives, Federal Home Loan Banks, and Federal Intermediate Credit Banks.
|
•
|
U.S. instrumentality obligations include, but are not limited to, the Export-Import Bank, Federal Home Loan Mortgage Corporation, and Federal National Mortgage Association.
|
•
|
Bank Obligations - Certificates of deposit, time deposits and bankers' acceptances of U.S. commercial banks having total assets of at least one billion dollars and overseas branches of U.S. commercial banks and foreign banks, which in the opinion of those managing the Fund's investments, are of comparable quality. A Fund may acquire obligations of U.S. banks that are not members of the Federal Reserve System or of the Federal Deposit Insurance Corporation.
|
•
|
Commercial Paper - Short-term promissory notes issued by U.S. or foreign corporations.
|
•
|
Short-term Corporate Debt - Corporate notes, bonds, and debentures that at the time of purchase have 397 days or less remaining to maturity.
|
•
|
Repurchase Agreements - Instruments under which securities are purchased from a bank or securities dealer with an agreement by the seller to repurchase the securities at the same price plus interest at a specified rate.
|
•
|
Taxable Municipal Obligations - Short-term obligations issued or guaranteed by state and municipal issuers which generate taxable income.
|
Name, Address,
and Year of Birth
|
Position(s) Held
with the Trust and Length of Time Served as Trustee
|
Principal Occupation(s)
During Past 5 Years
|
Number of
Portfolios
in Fund
Complex
Overseen
by Trustee
|
Other Directorships
Held by Trustee
During Past 5 Years
|
Elizabeth Ballantine
711 High Street
Des Moines, IA 50392
1948
|
Trustee (since 2014)
Member Nominating and Governance Committee
|
Principal, EBA Associates
(consulting and investments)
|
136
|
Durango Herald, Inc.;
McClatchy Newspapers, Inc.
|
|
|
|
|
|
Leroy T. Barnes, Jr.
711 High Street
Des Moines, IA 50392
1951
|
Trustee (since 2014)
Member, Audit Committee
|
Retired
|
136
|
McClatchy Newspapers, Inc.; Herbalife Ltd.; Frontier Communications, Inc.
|
|
|
|
|
|
Craig Damos
711 High Street
Des Moines, IA 50392
1954
|
Trustee (since 2014)
Member 15(c) Committee
Member Audit Committee
|
President, The Damos Company (consulting services)
|
136
|
Hardin Construction
|
|
|
|
|
|
Mark A. Grimmett
711 High Street
Des Moines, IA 50392
1960
|
Trustee (since 2014)
Member 15(c) Committee
Member Executive Committee
Member Nominating and Governance Committee
|
Formerly, Executive Vice President and CFO, Merle Norman Cosmetics, Inc. (cosmetics manufacturing)
|
136
|
None
|
|
|
|
|
|
Fritz S. Hirsch
711 High Street
Des Moines, IA 50392
1951
|
Trustee (since 2014)
Member 15(c) Committee
Member Operations Committee
|
Formerly CEO, MAM USA (manufacturer of infant and juvenile products).
|
136
|
Focus Products Group (housewares); MAM USA
|
|
|
|
|
|
Tao Huang
711 High Street
Des Moines, IA 50392
1962
|
Trustee (since 2014)
Member 15(c) Committee
Member Operations
Committee
|
Retired
|
136
|
Armstrong World Industries, Inc. (manufacturing)
|
|
|
|
|
|
Karen (“Karrie”) McMillan
711 High Street
Des Moines, IA 50392
1961
|
Trustee (since 2014)
Member Operations Committee
|
Managing Director, Patomak Global Partners, LLC (financial services consulting). Formerly, General Counsel, Investment Company Institute
|
136
|
None
|
|
|
|
|
|
Elizabeth A. Nickels
711 High Street
Des Moines, IA 50392
1962
|
Trustee (since 2015)
Member Audit Committee
|
Formerly Executive Director, Herman Miller Foundation; Formerly President Herman Miller Healthcare
|
136
|
Charlotte Russe; Follet Corporation; PetSmart; SpartanNash; Spectrum Health Systems
|
|
|
|
|
|
Name, Address,
and Year of Birth
|
Position(s)
Held
with Fund and Length of Time Served
|
Positions with PGI and its affiliates;
Principal Occupation(s)
During Past 5 Years**
(unless noted otherwise)
|
Number of
Portfolios
in Fund
Complex
Overseen
by Trustee
|
Other
Directorships
Held by
Trustee
During Past
5 Years
|
Michael J. Beer
Des Moines, IA 50392
1961
|
Trustee (since 2014)
Chief Executive Officer and President (since 2015)
Executive Vice President (2014-2015)
Member Executive Committee
|
Executive Director - Funds and Director, PGI (since 2017)
Chief Executive Officer and Director, PFD (since 2015)
Executive Director/Principal Funds & Trust, PLIC (since 2015)
VP/Chief Operating Officer Principal Funds, PLIC (2014-2015)
VP/Mutual Funds & Broker Dealer, PLIC (2001-2014)
President, Chief Executive Officer, and Chair, PMC (2015-2017)
EVP/Chief Operating Officer, PMC (2008-2015)
Director, PMC (2006-2015)
President and Director, PSI (2005-2015)
Chairman and Executive Vice President, PSS (since 2015)
President and Director, PSS (2007-2015)
|
136
|
None
|
|
|
|
|
|
Nora M. Everett
Des Moines, IA 50392
1959
|
Chair and Trustee (since 2014)
Member Executive
Committee
|
Director, Finisterre
Director, Origin
Chairman, PFA (2010-2015)
Chairman, PFD (2011-2015)
President/RIS, PLIC (since 2015)
Senior Vice President/RIS, PLIC (2008-2015)
Chairman, PMC (2011-2015)
President, PMC (2008-2015)
Director, PSI (since 2015)
Chief Executive Officer, PSI (2009-2015)
Chairman, PSI (2011-2015)
Chairman, PSS (2011-2015)
|
136
|
None
|
Patrick G. Halter Des Moines, Iowa 50392 1959
|
Trustee (since 2017)
|
Chief Operating Officer, PGI (Since 2017)
Director, PGI (Since 2003)
Director, Morley (Since 2017)
Chair, Post (Since 2017)
Chair, PREI (since 2004)
Chief Executive Officer, PREI (since 2005)
Chair, Spectrum (Since 2017)
|
136
|
None
|
•
|
Principal Real Estate Investors, LLC (PREI)
|
•
|
Principal Securities, Inc. (PSI) formerly Princor Financial Services Corporation
|
ETF
*
|
Ballantine
|
Barnes
|
Damos
|
Grimmett
|
Hirsch
|
Huang
|
McMillan
|
Nickels
|
Principal EDGE Active Income
|
A
|
A
|
A
|
C
|
A
|
A
|
A
|
A
|
Principal Millennials Index
|
A
|
A
|
A
|
A
|
A
|
A
|
D
|
A
|
Total Fund Complex
|
E
|
E
|
E
|
E
|
E
|
E
|
E
|
E
|
*
|
The Principal Investment Grade Corporate Active ETF was not in operation as of December 31, 2017.
|
|
Beer
|
Everett
|
Halter
|
Total Fund Complex*
|
E
|
E
|
E
|
*
|
The Principal Investment Grade Corporate Active ETF was not in operation as of December 31, 2017.
|
Trustee
|
Funds in this SAI
*
|
Fund Complex
|
Elizabeth Ballantine
|
$862
|
$263,800
|
Leroy Barnes
|
$936
|
$282,750
|
Craig Damos
|
$955
|
$302,700
|
Mark A. Grimmett
|
$1,041
|
$314,000
|
Fritz Hirsch
|
$966
|
$292,250
|
Tao Huang
|
$915
|
$277,250
|
Karen ("Karrie") McMillan
|
$889
|
$270,000
|
Elizabeth Nickels
|
$886
|
$286,250
|
*
|
The Principal Investment Grade Corporate Active and Principal Spectrum Preferred Securities Active ETFs were not in operation during the period ended June 30, 2017.
|
Sub-Advisor:
|
Spectrum Asset Management, Inc. ("Spectrum")
is an indirect subsidiary of Principal Financial Group, Inc.
|
Fund:
|
Principal Spectrum Preferred Securities Active ETF
|
Fund
|
First $500
Million
|
Next $500
Million
|
Next $500
Million
|
Over $1.5
Billion
|
Principal Healthcare Innovators Index ETF
|
0.42%
|
0.40%
|
0.38%
|
0.37%
|
Principal Millennials Index ETF
|
0.45%
|
0.43%
|
0.41%
|
0.40%
|
Principal Price Setters Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Principal Shareholder Yield Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Fund
|
All Assets
|
Principal Active Global Dividend Income ETF
|
0.58%
|
Principal EDGE Active Income ETF
|
0.65%
|
Principal Investment Grade Corporate Active ETF
|
0.26%
|
Principal Spectrum Preferred Securities Active ETF
|
0.55%
|
Principal U.S. Small-Cap Multi-Factor Index ETF
|
0.38%
|
Management Fees for Periods Ended June 30
(amounts in thousands)
|
|||||||
|
2017
|
|
2016
|
|
|||
Principal Active Global Dividend Income ETF
|
$
|
300
|
|
(1)
|
N/A
|
|
|
Principal EDGE Active Income ETF
|
2,088
|
|
|
268
|
|
(2)
|
|
Principal Healthcare Innovators Index ETF
|
23
|
|
(3)
|
N/A
|
|
|
|
Principal Investment Grade Corporate Active ETF
|
N/A
|
|
(5)
|
N/A
|
|
|
|
Principal Millennials Index ETF
|
26
|
|
(3)
|
N/A
|
|
|
|
Principal Price Setters Index ETF
|
27
|
|
|
7
|
|
(4)
|
|
Principal Shareholder Yield Index ETF
|
27
|
|
|
7
|
|
(4)
|
|
Principal Spectrum Preferred Securities Active ETF
|
N/A
|
|
(5)
|
N/A
|
|
|
|
Principal U.S. Small-Cap Multi-Factor Index ETF
|
681
|
|
(6)
|
N/A
|
|
|
|
|
|
|
|
|
|||
(1)
Period from May 8, 2017, date operations commenced, through June 30, 2017
|
|||||||
(2)
Period from July 8, 2015, date operations commenced, through June 30, 2016
|
|||||||
(3)
Period from July 19, 2016, date operations commenced, through June 30, 2017
|
|||||||
(4)
Period from February 24, 2016, date operations commenced, through June 30, 2016
|
|||||||
(5)
The Principal Investment Grade Corporate Active and Principal Spectrum Preferred Securities Active ETFs had not commenced operations prior to the end of the most recent fiscal year end.
|
|||||||
(6)
Period from September 20, 2016, date operations commenced, through June 30, 2017
|
(1)
|
Period from July 8, 2015, date operations commenced, through June 30, 2016
|
(2)
|
Period from July 19, 2016, date operations commenced, through June 30, 2017
|
(3)
|
Period from March 21, 2016, date operations commenced, through June 30, 2016
|
(4)
|
Period from September 20, 2016, date operations commenced, through June 30, 2017
|
Fund
|
Sub-Advisor Employed by
the Fund Complex
|
Affiliated Broker
|
2017
Fund's Total
Commissions
Paid
|
% of Fund's Total
Commissions
|
% of Dollar Amount of Fund's Commissionable Transactions
|
||||
Principal EDGE Active Income ETF
|
|||||||||
|
Credit Suisse Asset Management, LLC
|
Credit Suisse Securities (USA), LLC
|
2,931
|
|
8.83
|
|
9.52
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Clearing Corp
|
129
|
|
0.39
|
|
1.31
|
|
|
|
Mellon Capital Management Corporation
|
Pershing LLC
|
547
|
|
1.65
|
|
1.37
|
|
|
|
AllianceBernstein L.P.
|
Sanford C. Bernstein & Co., LLC
|
861
|
|
2.59
|
|
2.70
|
|
|
|
Analytic Investors, LLC
|
Wells Fargo Securities, LLC
|
5,589
|
|
16.84
|
|
13.58
|
|
|
Total
|
$
|
10,057
|
|
30.30
|
%
|
28.48
|
%
|
||
Principal Healthcare Innovators Index ETF
|
|
|
|
|
|||||
|
Credit Suisse Asset Management, LLC
|
Credit Suisse Securities (USA), LLC
|
2
|
|
0.15
|
|
0.32
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Clearing Corp
|
100
|
|
8.60
|
|
10.27
|
|
|
|
Mellon Capital Management Corporation
|
Pershing LLC
|
1
|
|
0.08
|
|
0.03
|
|
|
Total
|
$
|
103
|
|
8.83
|
%
|
10.62
|
%
|
||
Principal Millennials Index ETF
|
|||||||||
|
Credit Suisse Asset Management, LLC
|
Credit Suisse Securities (Europe), LLC
|
361
|
|
17.97
|
|
16.33
|
|
|
|
Credit Suisse Asset Management, LLC
|
Credit Suisse Securities (USA), LLC
|
2
|
|
0.09
|
|
0.05
|
|
|
|
American Century Investment Management, Inc.
|
Instinet U.K. LTD
|
20
|
|
1.01
|
|
0.28
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Clearing Corp
|
576
|
|
28.63
|
|
45.40
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Securities Australia LTD
|
1
|
|
0.03
|
|
0.01
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Securities PLC
|
1
|
|
0.04
|
|
0.02
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Securities (Asia Pacific) LTD
|
7
|
|
0.37
|
|
0.14
|
|
|
|
Macquarie Capital Investment Management LLC
|
Macquarie Bank Limited
|
18
|
|
0.90
|
|
0.49
|
|
|
|
AllianceBernstein L.P.
|
Sanford C. Bernstein & Co., LLC
|
36
|
|
1.80
|
|
1.28
|
|
|
Total
|
$
|
1,022
|
|
50.84
|
%
|
64.00
|
%
|
||
Principal Price Setters Index ETF
|
|||||||||
|
Credit Suisse Asset Management, LLC
|
Credit Suisse Securities (USA), LLC
|
8
|
|
1.39
|
|
0.65
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Clearing Corp
|
18
|
|
3.03
|
|
3.70
|
|
|
|
Mellon Capital Management Corporation
|
Pershing LLC
|
7
|
|
1.24
|
|
0.48
|
|
|
Total
|
$
|
33
|
|
5.66
|
%
|
4.83
|
%
|
||
Principal Shareholder Yield index ETF
|
|||||||||
|
Credit Suisse Asset Management, LLC
|
Credit Suisse Securities (USA), LLC
|
22
|
|
2.29
|
|
1.22
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Clearing Corp
|
25
|
|
2.60
|
|
4.11
|
|
|
|
Mellon Capital Management Corporation
|
Pershing LLC
|
9
|
|
0.93
|
|
0.28
|
|
|
Total
|
$
|
56
|
|
5.82
|
%
|
5.61
|
%
|
||
Principal U.S. Small-Cap Multi-Factor Index ETF
|
|||||||||
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Clearing Corp
|
604
|
|
1.97
|
|
2.54
|
|
|
|
Macquarie Capital Investment Management LLC
|
Macquarie Capital (USA) Inc.
|
678
|
|
2.21
|
|
1.96
|
|
|
|
AllianceBernstein L.P.
|
Sanford C. Bernstein & Co., LLC
|
371
|
|
1.21
|
|
1.96
|
|
|
Total
|
$
|
1,653
|
|
5.39
|
%
|
6.46
|
%
|
Fund
|
Sub-Advisor Employed by
the Fund Complex
|
Affiliated Broker
|
2016
Fund's Total
Commissions
Paid
|
% of Fund's Total
Commissions
|
% of Dollar Amount of Fund's Commissionable Transactions
|
||||
Principal EDGE Active Income ETF
|
|||||||||
|
Mellon Capital Management Corporation
|
ConvergEx Execution Solutions, LLC
|
$
|
44
|
|
0.05
|
%
|
0.08
|
%
|
|
Credit Suisse Asset Management, LLC
|
Credit Suisse Securities (USA), LLC
|
1,770
|
|
2.00
|
|
2.55
|
|
|
|
J.P. Morgan Investment Management, Inc.
|
J.P. Morgan Clearing Corporation
|
2,979
|
|
3.36
|
|
0.55
|
|
|
|
Macquarie Capital Investment Management LLC
|
Macquarie Capital (USA) Inc
|
10,494
|
|
11.85
|
|
14.06
|
|
|
|
Mellon Capital Management Corporation
|
Pershing LLC
|
596
|
|
0.67
|
|
0.21
|
|
|
Total
|
$
|
15,883
|
|
17.93
|
%
|
17.45
|
%
|
||
Principal Shareholder Yield Index ETF
|
|
|
|
|
|||||
|
Mellon Capital Management Corporation
|
Pershing LLC
|
$
|
5
|
|
3.44
|
%
|
1.90
|
%
|
Total
|
$
|
5
|
|
3.44
|
%
|
1.90
|
%
|
•
|
Kestra Investment Services, LLC
|
•
|
when the Fund announces before the open of trading that all purchases, all redemptions or all purchases and redemptions on that day will be made entirely in cash;
|
•
|
when the securities in the In-Kind Creation Basket may not be available in sufficient quantity for delivery or may not be eligible for transfer through the systems of DTC or the Clearing Process; and
|
•
|
when the AP or its underlying investor is restricted under U.S. or local securities laws or policies from transacting in one or more securities in the In-Kind Creation Basket.
|
ETF
|
Standard Creation
Transaction
Fee *
|
Maximum Variable Charge for Cash Creation **
|
Standard Redemption
Transaction Fee *
|
Maximum Variable Charge for Cash Redemptions **
|
Principal Active Global Dividend Income
|
$500
|
3.00%
|
$500
|
2.00%
|
Principal EDGE Active Income
|
$500
|
3.00%
|
$500
|
2.00%
|
Principal Healthcare Innovators Index
|
$600
|
3.00%
|
$600
|
2.00%
|
Principal Investment Grade Corporate Active
|
$750
|
3.00%
|
$750
|
3.00%
|
Principal Millennials Index
|
$1,000
|
3.00%
|
$1,000
|
2.00%
|
Principal Price Setters Index
|
$500
|
3.00%
|
$500
|
2.00%
|
Principal Shareholder Yield Index
|
$500
|
3.00%
|
$500
|
2.00%
|
Principal Spectrum Preferred Securities Active
|
$250
|
3.00%
|
$250
|
2.00%
|
Principal U.S. Small-Cap Multi-Factor Index
|
$1,500
|
3.00%
|
$1,500
|
2.00%
|
ETF
|
Percent
of
Ownership
|
Name of Owner
|
Address of Owner
|
Principal Active Global Dividend Income
|
99.61%
|
Bank of New York Mellon
|
225 Liberty Street
|
|
|
|
New York, NY 10286
|
|
|
|
|
Principal EDGE Active Income
|
93.43%
|
Bank of New York Mellon
|
225 Liberty Street
|
|
|
|
New York, NY 10286
|
|
|
|
|
Principal Healthcare Innovators Index
|
81.82%
|
State Street Bank and Trust Company
|
John Hancock Tower
|
|
|
|
200 Clarendon St
|
|
|
|
Boston, MA 02116
|
|
|
|
|
Principal Healthcare Innovators Index
|
14.48%
|
National Financial Services, LLC
|
200 Liberty St,
|
|
|
|
One World Financial Center
|
|
|
|
New York, NY 10281-1003
|
|
|
|
|
Principal Millennials Index
|
50.53%
|
National Financial Services, LLC
|
200 Liberty St,
|
|
|
|
One World Financial Center
|
|
|
|
New York, NY 10281-1003
|
|
|
|
|
Principal Millennials Index
|
17.97%
|
Pershing LLC
|
One Pershing Plaza
|
|
|
|
Jersey City, NJ 07399
|
|
|
|
|
Principal Millennials Index
|
11.23%
|
J.P. Morgan Securities LLC/JP Morgan Chase
|
277 Park Avenue
|
|
|
|
New York, NY 10172
|
|
|
|
|
Principal Price Setters Index
|
46.44%
|
Pershing LLC
|
One Pershing Plaza
|
|
|
|
Jersey City, NJ 07399
|
|
|
|
|
Principal Price Setters Index
|
38.45%
|
National Financial Services, LLC
|
200 Liberty St,
|
|
|
|
One World Financial Center
|
|
|
|
New York, NY 10281-1003
|
|
|
|
|
Principal Price Setters Index
|
5.38%
|
Bank of America/Client Assets
|
100 North Tryon St
|
|
|
|
Charlotte, NC 28255
|
|
|
|
|
Principal Shareholder Yield Index
|
52.27%
|
National Financial Services, LLC
|
200 Liberty St,
|
|
|
|
One World Financial Center
|
|
|
|
New York, NY 10281-1003
|
|
|
|
|
Principal Shareholder Yield Index
|
17.61%
|
Pershing LLC
|
One Pershing Plaza
|
|
|
|
Jersey City, NJ 07399
|
|
|
|
|
Principal Shareholder Yield Index
|
8.44%
|
Bank of America/Client Assets
|
100 North Tryon St
|
|
|
|
Charlotte, NC 28255
|
|
|
|
|
Principal Shareholder Yield Index
|
7.13%
|
Merrill Lynch, Pierce, Fenner & Smith Incorporated
|
One Bryant Park
|
|
|
|
New York, NY 10036
|
|
|
|
|
Principal Shareholder Yield Index
|
7.02%
|
Goldman Sachs & Co. LLC
|
200 West St, 29th Floor
|
|
|
|
New York, NY 10282
|
|
|
|
|
Principal Spectrum Preferred Securities
|
60.48%
|
National Financial Services, LLC
|
200 Liberty St,
|
Index
|
|
|
One World Financial Center
|
|
|
|
New York, NY 10281-1003
|
|
|
|
|
ETF
|
Percent
of
Ownership
|
Name of Owner
|
Address of Owner
|
Principal Spectrum Preferred Securities
|
22.13%
|
RBC Capital Markets, LLC
|
200 Vesey St, 9th Floor
|
Index
|
|
|
New York, NY 10281
|
|
|
|
|
Principal Spectrum Preferred Securities
|
7.46%
|
J.P. Morgan Securities LLC/JP Morgan Chase
|
277 Park Avenue
|
Index
|
|
|
New York, NY 10172
|
|
|
|
|
Principal U.S. Small-Cap Multi-Factor Index
|
98.68%
|
Bank of New York Mellon
|
225 Liberty Street
|
|
|
|
New York, NY 10286
|
|
|
|
|
|
Other Accounts Managed
|
|||
Portfolio Manager and ETFs
|
Total
Number
of Accounts
|
Total Assets
in the
Accounts
|
Number of
Accounts
that base
the Advisory
Fee on
Performance
|
Total Assets
of the Accounts
that base the
Advisory
Fee on
Performance
|
John R. Friedl*:
Principal Investment Grade Corporate Active ETF
|
|
|
|
|
Registered investment companies
|
6
|
$9.7 billion
|
0
|
$0
|
Other pooled investment vehicles
|
2
|
$848.8 million
|
0
|
$0
|
Other accounts
|
1
|
$52.3 million
|
0
|
$0
|
|
|
|
|
|
Paul S. Kim*:
Principal Active Global Dividend Income, Principal EDGE Active Income, Principal Healthcare Innovators Index, Principal Investment Grade Corporate Active, Principal Millennials Index, Principal Price Setters Index, Principal Shareholder Yield Index, Principal Spectrum Preferred Securities Active, and Principal U.S. Small-Cap Multi-Factor Index ETFs
|
|
|
|
|
Registered investment companies
|
0
|
$0
|
0
|
$0
|
Other pooled investment vehicles
|
0
|
$0
|
0
|
$0
|
Other accounts
|
4
|
$1.5 billion
|
0
|
$0
|
|
|
|
|
|
Mark R. Nebelung
: Principal Healthcare Innovators Index, Principal Millennials Index, Principal Price Setters Index, and Principal Shareholder Yield Index, and Principal U.S. Small-Cap Multi-Factor Index ETFs
|
|
|
|
|
Registered investment companies
|
6
|
$1.4 billion
|
0
|
$0
|
Other pooled investment vehicles
|
11
|
$558 million
|
0
|
$0
|
Other accounts
|
2
|
$202 million
|
0
|
$0
|
|
|
|
|
|
Jeffrey A. Schwarte
: Principal Healthcare Innovators Index, Principal Millennials Index, Principal Price Setters Index, and Principal Shareholder Yield Index, and Principal U.S. Small-Cap Multi-Factor Index ETFs
|
|
|
|
|
Registered investment companies
|
10
|
$12.5 billion
|
0
|
$0
|
Other pooled investment vehicles
|
13
|
$33.4 billion
|
0
|
$0
|
Other accounts
|
1
|
$56.7 billion
|
0
|
$0
|
|
|
|
|
|
Daniela Spassova*:
Principal Active Global Dividend Income, Principal EDGE Active Income, Principal Investment Grade Corporate Active, and Principal Spectrum Preferred Securities Active ETFs
|
|
|
|
|
Registered investment companies
|
0
|
$0
|
0
|
$0
|
Other pooled investment vehicles
|
0
|
$0
|
0
|
$0
|
Other accounts
|
0
|
$0
|
0
|
$0
|
|
|
|
|
|
Timothy R. Warrick*:
Principal Investment Grade Corporate Active ETF
|
|
|
|
|
Registered investment companies
|
3
|
$3.7 billion
|
0
|
$0
|
Other pooled investment vehicles
|
8
|
$6.9 billion
|
0
|
$0
|
Other accounts
|
35
|
$16.6 billion
|
3
|
$1.6 billion
|
|
|
|
|
|
*
|
Information as of February 28, 2018. Portfolio Manager of the Principal Investment Grade Corporate Active ETF effective as of April 16, 2018.
|
Portfolio Manager
|
Trust Funds Managed by Portfolio Manager
(list each fund on its own line)
|
Dollar Range of Securities Owned by the Portfolio Manager
|
John R. Friedl*
|
Principal Investment Grade Corporate Active ETF
|
None
|
Paul S. Kim
|
Principal Active Global Dividend Income ETF
|
None
|
Paul S. Kim
|
Principal EDGE Active Income ETF
|
$50,001 - $100,000
|
Paul S. Kim
|
Principal Healthcare Innovators Index ETF
|
None
|
Paul S. Kim*
|
Principal Investment Grade Corporate Active ETF
|
None
|
Paul S. Kim
|
Principal Millennials Index ETF
|
None
|
Paul S. Kim
|
Principal Price Setters Index ETF
|
None
|
Paul S. Kim
|
Principal Shareholder Yield Index ETF
|
None
|
Paul S. Kim
|
Principal Spectrum Preferred Securities Active ETF
|
None
|
Paul S. Kim
|
Principal U.S. Small-Cap Multi-Factor Index ETF
|
None
|
Mark R. Nebelung
|
Principal Healthcare Innovators Index ETF
|
$100,001 - $500,000
|
Mark R. Nebelung
|
Principal Millennials Index ETF
|
$100,001 - $500,000
|
Mark R. Nebelung
|
Principal Price Setters Index ETF
|
$100,001 - $500,000
|
Mark R. Nebelung
|
Principal Shareholder Yield Index ETF
|
$50,001 - $100,000
|
Mark R. Nebelung
|
Principal U.S. Small-Cap Multi-Factor Index ETF
|
$100,001 - $500,000
|
Jeffrey A. Schwarte
|
Principal Healthcare Innovators Index ETF
|
$50,001 - $100,000
|
Jeffrey A. Schwarte
|
Principal Millennials Index ETF
|
$100,001 - $500,000
|
Jeffrey A. Schwarte
|
Principal Price Setters Index ETF
|
$100,001 - $500,000
|
Jeffrey A. Schwarte
|
Principal Shareholder Yield Index ETF
|
$100,001 - $500,000
|
Jeffrey A. Schwarte
|
Principal U.S. Small-Cap Multi-Factor Index ETF
|
$100,001 - $500,000
|
Daniela Spassova
|
Principal Active Global Dividend Income ETF
|
None
|
Daniela Spassova
|
Principal EDGE Active Income ETF
|
None
|
Daniela Spassova*
|
Principal Investment Grade Corporate Active ETF
|
None
|
Daniela Spassova
|
Principal Spectrum Preferred Securities Active ETF
|
None
|
Timothy R. Warrick*
|
Principal Investment Grade Corporate Active ETF
|
None
|
*
|
Information as of February 28, 2018. Portfolio Manager of the Principal Investment Grade Corporate Active ETF effective as of April 16, 2018.
|
|
|
Other Accounts Managed
|
|||
|
Total
Number
of Accounts
|
Total Assets
in the
Accounts
|
Number of
Accounts
that base
the Advisory
Fee on
Performance
|
Total Assets
of the Accounts
that base the
Advisory
Fee on
Performance
|
Charles D. Averill:
Principal EDGE Active Income ETF
|
|
|
|
|
Registered investment companies
|
11
|
$16.3 billion
|
0
|
$0
|
Other pooled investment vehicles
|
0
|
$0
|
0
|
$0
|
Other accounts
|
1
|
$27.1 million
|
0
|
$0
|
|
|
|
|
|
Daniel R. Coleman:
Principal Active Global Dividend Income ETF
|
|
|
|
|
Registered investment companies
|
5
|
$12.5 billion
|
0
|
$0
|
Other pooled investment vehicles
|
2
|
$91.8 million
|
0
|
$0
|
Other accounts
|
3
|
$2.0 billion
|
0
|
$0
|
|
|
|
|
|
Todd A. Jablonski
: Principal EDGE Active Income ETF
|
|
|
|
|
Registered investment companies
|
11
|
$16.3 billion
|
0
|
$0
|
Other pooled investment vehicles
|
0
|
$0
|
0
|
$0
|
Other accounts
|
1
|
$27.1 million
|
0
|
$0
|
|
|
|
|
|
Cliff Remily:
Principal Active Global Dividend Income ETF
|
|
|
|
|
Registered investment companies
|
0
|
$0
|
0
|
$0
|
Other pooled investment vehicles
|
0
|
$0
|
0
|
$0
|
Other accounts
|
0
|
$0
|
0
|
$0
|
|
|
|
|
|
Gregory L. Tornga:
Principal EDGE Active Income ETF
|
|
|
|
|
Registered investment companies
|
10
|
$16.1 billion
|
0
|
$0
|
Other pooled investment vehicles
|
0
|
$0
|
0
|
$0
|
Other accounts
|
1
|
$27.1 million
|
0
|
$0
|
Portfolio Manager
|
Trust Funds Managed by Portfolio Manager
(list each fund on its own line)
|
Dollar Range of Securities Owned by the Portfolio Manager
|
Charles D. Averill
|
Principal EDGE Active Income ETF
|
$10,001 - $50,000
|
Daniel R. Coleman
|
Principal Active Global Dividend Income ETF
|
$10,001 - $50,000
|
Todd A. Jablonski
|
Principal EDGE Active Income ETF
|
$100,001 - $500,000
|
Cliff Remily
|
Principal Active Global Dividend Income ETF
|
$100,001 - $500,000
|
Gregory L. Tornga
|
Principal EDGE Active Income ETF
|
$10,001 - $50,000
|
|
|
Other Accounts Managed
(Information as of July 31, 2017)
|
|||
|
Total
Number
of Accounts
|
Total Assets
in the
Accounts
|
Number of
Accounts
that base
the Advisory
Fee on
Performance
|
Total Assets
of the Accounts
that base the
Advisory
Fee on
Performance
|
Roberto Giangregorio:
Principal Spectrum Preferred Securities Active ETF
|
|
|
|
|
Registered investment companies
|
6
|
$10.4 billion
|
0
|
$0
|
Other pooled investment vehicles
|
31
|
$5.8 billion
|
0
|
$0
|
Other accounts
|
43
|
$6.5 billion
|
0
|
$0
|
|
|
|
|
|
L. Phillip Jacoby, IV:
Principal Spectrum Preferred Securities Active ETF
|
|
|
|
|
Registered investment companies
|
6
|
$10.4 billion
|
0
|
$0
|
Other pooled investment vehicles
|
31
|
$5.8 billion
|
0
|
$0
|
Other accounts
|
43
|
$6.5 billion
|
0
|
$0
|
|
|
|
|
|
Manu Krishnan:
Principal Spectrum Preferred Securities Active ETF
|
|
|
|
|
Registered investment companies
|
6
|
$10.4 billion
|
0
|
$0
|
Other pooled investment vehicles
|
31
|
$5.8 billion
|
0
|
$0
|
Other accounts
|
43
|
$6.5 billion
|
0
|
$0
|
|
|
|
|
|
Mark A. Lieb:
Principal Spectrum Preferred Securities Active ETF
|
|
|
|
|
Registered investment companies
|
6
|
$10.4 billion
|
0
|
$0
|
Other pooled investment vehicles
|
31
|
$5.8 billion
|
0
|
$0
|
Other accounts
|
43
|
$6.5 billion
|
0
|
$0
|
|
|
|
|
|
•
|
Changes in overall firm assets under management, including those assets in the Fund. (Portfolio managers are not directly incentivized to increase assets (“AUM”), although they are indirectly compensated as a result of an increase in AUM)
|
Portfolio Manager
|
Trust Funds Managed by Portfolio Manager
|
Dollar Range of Securities Owned by the Portfolio Manager
|
Roberto Giangregorio
|
Principal Spectrum Preferred Securities Active ETF
|
None
|
L. Phillip Jacoby, IV
|
Principal Spectrum Preferred Securities Active ETF
|
None
|
Manu Krishnan
|
Principal Spectrum Preferred Securities Active ETF
|
None
|
Mark A. Lieb
|
Principal Spectrum Preferred Securities Active ETF
|
$100,001- $500,000
|
Aaa:
|
Obligations rated Aaa are judged to be of the highest quality, subject to the lowest level of credit risk.
|
Aa:
|
Obligations rated Aa are judged to be of high quality and are subject to very low credit risk.
|
A:
|
Obligations rated A are considered upper-medium grade and are subject to low credit risk.
|
Baa:
|
Obligations rated Baa are subject to moderate credit risk. They are considered medium-grade and as such may possess certain speculative characteristics.
|
Ba:
|
Obligations rated Ba are judged to be speculative and are subject to substantial credit risk.
|
B:
|
Obligations rated B are considered speculative and are subject to high credit risk.
|
Caa:
|
Obligations rated Caa are judged to be speculative of poor standing and are subject to very high credit risk.
|
Ca:
|
Obligations rated Ca are highly speculative and are likely in, or very near, default, with some prospect of recovery of principal and interest.
|
C:
|
Obligations rated C are the lowest rated class of bonds and are typically in default, with little prospect for recovery of principal or interest.
|
•
|
Likelihood of payment - capacity and willingness of the obligor to meet its financial commitment on an obligation in accordance with the terms of the obligation;
|
•
|
Nature of and provisions of the obligation;
|
•
|
Protection afforded by, and relative position of, the obligation in the event of bankruptcy, reorganization, or other arrangement under the laws of bankruptcy and other laws affecting creditor's rights.
|
AAA:
|
Obligations rated ‘AAA’ have the highest rating assigned by S&P Global. The obligor’s capacity to meet its financial commitment on the obligation is extremely strong.
|
AA:
|
Obligations rated ‘AA’ differ from the highest-rated issues only in small degree. The obligor’s capacity to meet its financial commitment on the obligation is very strong.
|
A:
|
Obligations rated ‘A’ have a strong capacity to meet financial commitment on the obligation although they are somewhat more susceptible to the adverse effects of changes in circumstances and economic conditions than obligations in higher-rated categories.
|
BBB:
|
Obligations rated ‘BBB’ exhibit adequate protection parameters; however, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity to meet financial commitment on the obligation.
|
BB, B, CCC,
|
Obligations rated ‘BB’, ‘B’, ‘CCC’, ‘CC’, and ‘C’ are regarded, on balance, as having significant
|
CC, and C:
|
speculative characteristics. ‘BB’ indicates the lowest degree of speculation and ‘C’ the highest degree of speculation. While such obligations will likely have some quality and protective characteristics, these may be outweighed by large uncertainties or major risk exposures to adverse conditions.
|
BB:
|
Obligations rated ‘BB’ are less vulnerable to nonpayment than other speculative issues. However it faces major ongoing uncertainties or exposure to adverse business, financial, or economic conditions which could lead to the obligor’s inadequate capacity to meet its financial commitment on the obligation.
|
B:
|
Obligations rated ‘B’ are more vulnerable to nonpayment than ‘BB’ but the obligor currently has the capacity to meet its financial commitment on the obligation. Adverse business, financial, or economic conditions will likely impair this capacity.
|
CCC:
|
Obligations rated ‘CCC’ are currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions for the obligor to meet its financial commitment on the obligation. If adverse business, financial, or economic conditions occur, the obligor is not likely to have the capacity to meet its financial commitment on the obligation.
|
CC:
|
Obligations rated ‘CC’ are currently highly vulnerable to nonpayment. The ‘CC’ rating is used when a default has not yet occurred but S&P Global expects default to be a virtual certainty, regardless of anticipated time to default.
|
C:
|
The rating ‘C’ is highly vulnerable to nonpayment, the obligation is expected to have lower relative seniority or lower ultimate recovery compared to higher rated obligations.
|
D:
|
Obligations rated ‘D’ are in default, or in breach of an imputed promise. For non-hybrid capital instruments, the ‘D’ rating category is used when payments on an obligation are not made on the date due, unless S&P Global believes that such payments will be made within five business days in the absence of a stated grace period or within the earlier of the stated grace period or 30 calendar days. The rating will also be used upon filing for bankruptcy petition or the taking of similar action and where default is a virtual certainty. If an obligation is subject to a distressed exchange offer the rating is lowered to ‘D’.
|
NR:
|
Indicates that no rating has been requested, that there is insufficient information on which to base a rating or that S&P Global does not rate a particular type of obligation as a matter of policy.
|
A-1:
|
This is the highest category. The obligor’s capacity to meet its financial commitment on the obligation is strong. Within this category, certain obligations are designated with a plus sign (+). This indicates that the obligor’s capacity to meet its financial commitment on these obligations is extremely strong.
|
A-2:
|
Issues carrying this designation are somewhat more susceptible to the adverse effects of the changes in circumstances and economic conditions than obligations in higher rating categories. However, the obligor’s capacity to meet its financial commitment on the obligation is satisfactory.
|
A-3:
|
Issues carrying this designation exhibit adequate capacity to meet their financial obligations. However, adverse economic conditions or changing circumstances are more likely to lead to a weakened capacity of the obligor to meet it financial commitment on the obligation.
|
B:
|
Issues rated ‘B’ are regarded as vulnerable and have significant speculative characteristics. The obligor has capacity to meet financial commitments; however, it faces major ongoing uncertainties which could lead to obligor’s inadequate capacity to meet its financial obligations.
|
C:
|
This rating is assigned to short-term debt obligations that are currently vulnerable to nonpayment and is dependent upon favorable business, financial, and economic conditions to meet its financial commitment on the obligation.
|
D:
|
This rating indicates that the issue is either in default or in breach of an imputed promise. For non-hybrid capital instruments, the ‘D’ rating category is used when payments on an obligation are not made on the date due, unless S&P Global believes that such payments will be made within five business days in the absence of a stated grace period or within the earlier of the stated grace period or 30 calendar days. The rating will also be used upon filing for bankruptcy petition or the taking of similar action and where default is a virtual certainty. If an obligation is subject to a distressed exchange offer the rating is lowered to ‘D’.
|
SP-1:
|
A strong capacity to pay principal and interest. Issues that possess a very strong capacity to pay debt service is given a "+" designation.
|
SP-2:
|
A satisfactory capacity to pay principal and interest, with some vulnerability to adverse financial and economic changes over the terms of the notes.
|
SP-3:
|
A speculative capacity to pay principal and interest.
|
AAA:
|
Highest credit quality. ‘AAA’ ratings denote the lowest expectation of credit risk. They are assigned only in case of exceptionally strong capacity for payment of financial commitments. This capacity is highly unlikely to be adversely affected by foreseeable events.
|
AA:
|
Very high credit quality. ‘AA’ ratings denote expectations of very low credit risk. They indicate very strong capacity for timely payment of financial commitments. This capacity is not significantly vulnerable to foreseeable events.
|
A:
|
High credit quality. ‘A’ ratings denote low expectation of credit risk. The capacity for timely payment of financial commitments is considered strong. This capacity may, nevertheless, be more vulnerable to adverse business or economic conditions than is the case for higher ratings.
|
BBB:
|
Good credit quality. ‘BBB’ ratings indicate that expectations of credit risk are currently low. The capacity for payment of financial commitments is considered adequate, but adverse business or economic conditions are more likely to impair this capacity.
|
BB:
|
Speculative. ‘BB’ ratings indicate an elevated vulnerability to credit risk, particularly in the event of adverse changes in business or economic conditions over time; however, business or financial alternatives may be available to allow financial commitments to be met.
|
B:
|
Highly speculative. ‘B’ ratings indicate that material credit risk is present.
|
CCC:
|
Substantial credit risk. ‘CCC’ ratings indicate that substantial credit risk is present.
|
CC:
|
Very high levels of credit risk. ‘CC’ ratings indicate very high levels of credit risk.
|
C:
|
Exceptionally high levels of credit risk. ‘C’ indicates exceptionally high levels of credit risk.
|
D:
|
Default. ‘D’ ratings indicate an issuer has entered into bankruptcy filings, administration, receivership, liquidation or which has otherwise ceased business.
|
F1:
|
Highest short-term credit quality. Indicates the strongest intrinsic capacity for timely payment of financial commitments; may have an added “+” to denote any exceptionally strong credit feature.
|
F2:
|
Good short-term credit quality. Good intrinsic capacity for timely payment of financial commitments.
|
F3:
|
Fair short-term credit quality. The intrinsic capacity for timely payment of financial commitments is adequate.
|
B:
|
Speculative short-term credit quality. Minimal capacity for timely payment of financial commitments, plus heightened vulnerability to near term adverse changes in financial and economic conditions.
|
C:
|
High short-term default risk. Default is a real possibility.
|
RD:
|
Restricted default. Indicates an entity that has defaulted on one or more of its financial commitments, although it continues to meet other financial obligations. Typically applicable to entity ratings only.
|
D:
|
Default. Indicates a broad-based default event for an entity, or the default of a specific short-term obligation.
|
RR1:
|
Outstanding recovery prospects given default. ‘RR1’ rated securities have characteristics consistent with securities historically recovering 91%-100% of current principal and related interest.
|
RR2:
|
Superior recovery prospects given default. ‘RR2’ rated securities have characteristics consistent with securities historically recovering 71%-90% of current principal and related interest.
|
RR3:
|
Good recovery prospects given default. ‘RR3’ rated securities have characteristics consistent with securities historically recovering 51%-70% of current principal and related interest.
|
RR4:
|
Average recovery prospects given default. ‘RR4’ rated securities have characteristics consistent with securities historically recovering 31%-50% of current principal and related interest.
|
RR5:
|
Below average recovery prospects given default. ‘RR5’ rated securities have characteristics consistent with securities historically recovering 11%-30% of current principal and related interest.
|
RR6:
|
Poor recovery prospects given default. ‘RR6’ rated securities have characteristics consistent with securities historically recovering 0%-10% of current principal and related interest.
|
DENMARK
|
|
|
|
January 1
|
April 2
|
May 21
|
December 26
|
March 29
|
April 27
|
June 5
|
December 31
|
March 30
|
May 10
|
December 24
|
January 1
|
April 1
|
May 11
|
December 25
|
|
|
|
|
|
FINLAND
|
|
|
|
January 1
|
May 1
|
December 24
|
January 1
|
January 6
|
May 10
|
December 25
|
|
March 30
|
June 22
|
December 26
|
|
April 2
|
December 6
|
December 31
|
|
|
|
|
|
FRANCE
|
|
|
|
January 1
|
May 7
|
October 31
|
January 1
|
March 30
|
May 8
|
November 1
|
|
April 2
|
May 28
|
December 25
|
|
May 1
|
August 15
|
December 26
|
|
|
|
|
|
GERMANY
|
|
|
|
January 1
|
May 10
|
October 31
|
December 26
|
March 30
|
May 21
|
November 1
|
December 31
|
April 2
|
May 31
|
December 24
|
January 1
|
May 1
|
October 3
|
December 25
|
|
|
|
|
|
GREECE
|
|
|
|
January 6
|
April 9
|
August 15
|
January 1
|
February 19
|
May 1
|
December 25
|
|
April 6
|
May 28
|
December 26
|
|
|
|
|
|
HONG KONG
|
|
|
|
January 1
|
April 5
|
September 25
|
January 1
|
February 16
|
May 1
|
October 1
|
February 5
|
February 19
|
May 22
|
October 17
|
February 6
|
March 30
|
June 18
|
December 25
|
February 7
|
April 2
|
July 2
|
December 26
|
|
|
|
|
|
HUNGARY
|
|
|
|
January 1
|
May 1
|
November 1
|
December 31
|
March 15
|
May 21
|
November 2
|
January 1
|
March 16
|
August 20
|
December 24
|
|
April 2
|
October 22
|
December 25
|
|
April 30
|
October 23
|
December 26
|
|
|
|
|
|
ICELAND
|
|
|
|
January 1
|
April 19
|
June 17
|
December 26
|
March 29
|
May 1
|
August 6
|
December 31
|
March 30
|
May 10
|
December 24
|
January 1
|
April 2
|
May 21
|
December 25
|
|
|
|
|
|
IRELAND
|
|
|
|
January 1
|
May 7
|
October 29
|
December 26
|
March 30
|
June 4
|
December 24
|
December 31
|
April 2
|
August 6
|
December 25
|
January 1
|
|
|
|
|
POLAND
|
|
|
|
January 1
|
April 17
|
June 15
|
December 25
|
January 6
|
May 1
|
August 15
|
December 26
|
March 30
|
May 3
|
November 1
|
December 31
|
April 2
|
May 4
|
November 11
|
January 1
|
April 16
|
May 31
|
December 24
|
|
|
|
|
|
PORTUGAL
|
|
|
|
January 1
|
April 2
|
December 25
|
January 1
|
March 30
|
May 1
|
December 26
|
|
|
|
|
|
SINGAPORE
|
|
|
|
January 1
|
May 29
|
November 6
|
February 6
|
February 16
|
June 15
|
December 25
|
|
March 30
|
August 9
|
January 1
|
|
May 1
|
August 22
|
February 5
|
|
|
|
|
|
SOUTH AFRICA
|
|
|
|
January 1
|
April 2
|
August 3
|
December 25
|
March 21
|
April 27
|
August 9
|
December 26
|
March 25
|
May 1
|
September 24
|
January 1
|
March 28
|
May 2
|
December 16
|
|
March 30
|
June 16
|
December 17
|
|
|
|
|
|
SPAIN
|
|
|
|
January 1
|
May 1
|
October 12
|
December 26
|
March 19
|
May 31
|
November 1
|
January 1
|
March 29
|
July 25
|
December 6
|
|
March 30
|
August 15
|
December 24
|
|
April 2
|
September 11
|
December 25
|
|
|
|
|
|
SWEDEN
|
|
|
|
January 1
|
May 1
|
June 6
|
December 26
|
March 29
|
May 10
|
June 22
|
December 31
|
March 30
|
May 18
|
December 24
|
January 1
|
April 2
|
May 21
|
December 25
|
|
|
|
|
|
SWITZERLAND
|
|
|
|
January 1
|
May 1
|
August 1
|
January 2
|
January 2
|
May 10
|
December 25
|
|
March 30
|
May 21
|
December 26
|
|
April 2
|
May 31
|
January 1
|
|
|
|
|
|
TURKEY
|
|
|
|
January 1
|
June 24
|
August 21
|
September 2
|
April 23
|
June 25
|
August 22
|
September 3
|
May 1
|
June 26
|
August 23
|
September 4
|
May 19
|
June 27
|
August 24
|
October 28
|
June 14
|
July 15
|
August 30
|
October 29
|
June 15
|
August 20
|
September 1
|
January 1
|
|
|
|
|
|
|
|
|
|
|
|
|
SETTLEMENT PERIODS GREATER THAN SEVEN DAYS FOR PERIOD
JANUARY 1, 2018 THROUGH JANUARY 31, 2019
|
|||
|
Beginning of Settlement Period
|
End of Settlement
Period
|
Number of Days in Settlement Period
|
Australia
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
01/02/2019
|
12
|
|
|
|
|
Austria
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
01/02/2019
|
12
|
|
|
|
|
Belgium
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
12/31/2018
|
10
|
|
|
|
|
Brazil
|
2/7/2018
|
2/15/2018
|
8
|
|
2/8/2018
|
2/16/2018
|
8
|
|
2/9/2018
|
2/19/2018
|
10
|
|
|
|
|
China
|
02/12/2018
|
02/22/2018
|
10
|
|
02/13/2018
|
02/23/2018
|
10
|
|
02/14/2018
|
02/26/2018
|
12
|
|
09/26/2018
|
10/08/2018
|
12
|
|
09/27/2018
|
10/09/2018
|
12
|
|
09/28/2018
|
10/10/2018
|
12
|
|
|
|
|
Denmark
|
03/26/2018
|
04/03/2018
|
8
|
|
03/27/2018
|
04/04/2018
|
8
|
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
|
|
|
Finland
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
12/31/2018
|
10
|
|
|
|
|
Greece
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
12/31/2018
|
10
|
|
|
|
|
Hong Kong
|
03/29/2018
|
04/06/2018
|
8
|
|
|
|
|
Ireland
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
01/02/2019
|
12
|
|
|
|
|
Israel
|
3/28/2018
|
4/8/2018
|
11
|
|
3/29/2018
|
4/9/2018
|
11
|
|
09/04/2018
|
09/12/2018
|
8
|
|
09/05/2018
|
09/13/2018
|
8
|
|
09/06/2018
|
09/17/2018
|
11
|
|
09/13/2018
|
09/25/2018
|
12
|
|
9/17/2018
|
10/2/2018
|
15
|
|
9/20/2018
|
10/3/2018
|
13
|
|
|
|
|
Japan
|
4/27/2018
|
5/7/2018
|
10
|
|
12/26/2018
|
01/04/2019
|
9
|
|
12/27/2018
|
01/07/2019
|
11
|
|
12/28/2018
|
1/8/2019
|
11
|
|
|
|
|
SETTLEMENT PERIODS GREATER THAN SEVEN DAYS FOR PERIOD
JANUARY 1, 2018 THROUGH JANUARY 31, 2019
|
|||
|
Beginning of Settlement Period
|
End of Settlement
Period
|
Number of Days in Settlement Period
|
Norway
|
03/26/2018
|
04/03/2018
|
8
|
|
03/27/2018
|
04/04/2018
|
8
|
|
03/28/2018
|
04/05/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
1/2/2019
|
11
|
|
|
|
|
Poland
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
1/2/2019
|
11
|
|
|
|
|
South Africa
|
3/14/2018
|
3/22/2018
|
8
|
|
3/15/2018
|
3/23/2018
|
8
|
|
3/16/2018
|
3/26/2018
|
10
|
|
3/19/2018
|
3/27/2018
|
8
|
|
3/20/2018
|
3/28/2018
|
8
|
|
3/23/2018
|
4/3/2018
|
11
|
|
3/26/2018
|
4/4/2018
|
9
|
|
3/27/2018
|
4/5/2018
|
9
|
|
3/28/2018
|
4/6/2018
|
9
|
|
3/29/2018
|
4/9/2018
|
11
|
|
4/20/2018
|
4/30/2018
|
10
|
|
4/23/2018
|
5/2/2018
|
9
|
|
4/24/2018
|
5/3/2018
|
9
|
|
4/25/2018
|
5/4/2018
|
9
|
|
4/26/2018
|
5/7/2018
|
11
|
|
4/30/2018
|
5/8/2018
|
8
|
|
8/2/2018
|
8/10/2018
|
8
|
|
8/3/2018
|
8/13/2018
|
10
|
|
8/6/2018
|
8/14/2018
|
8
|
|
8/7/2018
|
8/15/2018
|
8
|
|
8/8/2018
|
8/16/2018
|
8
|
|
9/17/2018
|
9/25/2018
|
8
|
|
9/18/2018
|
9/26/2018
|
8
|
|
9/19/2018
|
9/27/2018
|
8
|
|
9/20/2018
|
9/28/2018
|
8
|
|
9/21/2018
|
10/1/2018
|
10
|
|
12/10/2018
|
12/18/2018
|
8
|
|
12/11/2018
|
12/19/2018
|
8
|
|
12/12/2018
|
12/20/2018
|
8
|
|
12/13/2018
|
12/21/2018
|
8
|
|
12/14/2018
|
12/24/2018
|
10
|
|
12/18/2018
|
12/27/2018
|
9
|
|
12/19/2018
|
12/28/2018
|
9
|
|
12/20/2018
|
12/31/2018
|
11
|
|
12/21/2018
|
1/2/2019
|
12
|
|
12/24/2018
|
1/3/2019
|
10
|
|
|
|
|
Spain
|
3/26/2018
|
4/3/2008
|
8
|
|
3/27/2018
|
4/4/2018
|
8
|
|
3/28/2018
|
4/5/2018
|
8
|
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
12/31/2018
|
10
|
|
|
|
|
SETTLEMENT PERIODS GREATER THAN SEVEN DAYS FOR PERIOD
JANUARY 1, 2018 THROUGH JANUARY 31, 2019
|
|||
|
Beginning of Settlement Period
|
End of Settlement
Period
|
Number of Days in Settlement Period
|
Sweden
|
03/26/2018
|
04/03/2018
|
8
|
|
03/27/2018
|
04/04/2018
|
8
|
|
12/19/2018
|
12/27/2018
|
8
|
|
12/20/2018
|
12/28/2018
|
8
|
|
12/21/2018
|
01/02/2019
|
12
|
|
|
|
|
Turkey
|
8/16/2018
|
8/27/2018
|
11
|
|
8/17/2018
|
8/28/2018
|
11
|
|
8/20/2018
|
8/28/2018
|
8
|
1.
|
Written affirmation that all proxies voted during the preceding calendar quarter, other than those specifically identified by the advisor or sub-advisor, were voted in a manner consistent with the advisor's or sub-advisor's voting policies and procedures. In order to monitor the potential effect of conflicts of interest of an advisor or sub-advisor, the advisor or sub-advisor will identify any proxies the advisor or sub-advisor voted in a manner inconsistent with its policies and procedures. The advisor or sub-advisor shall list each vote, explain why the advisor or sub-advisor voted in a manner contrary to its policies and procedures, state whether the advisor or sub-advisor’s vote was consistent with the recommendation to the advisor or sub-advisor of a third party and, if so, identify the third party; and
|
2.
|
Written notification of any changes to the advisor's or sub-advisor's proxy voting policies and procedures made during the preceding calendar quarter.
|
1.
|
Identification of the issuer of the security;
|
2.
|
Exchange ticker symbol of the security;
|
3.
|
CUSIP number of the security;
|
4.
|
The date of the shareholder meeting;
|
5.
|
A brief description of the subject of the vote;
|
6.
|
Whether the proposal was put forward by the issuer or a shareholder;
|
7.
|
Whether and how the vote was cast;
|
8.
|
Whether the vote was cast for or against management of the issuer.
|
•
|
The Advisers do not maintain a written proxy voting policy as required by Rule 206(4)-6.
|
•
|
Proxies are not voted in Clients’ best interests.
|
•
|
Proxies are not identified and voted in a timely manner.
|
•
|
Conflicts between the Advisers’ interests and the Client are not identified; therefore, proxies are not voted appropriately.
|
•
|
The third-party proxy voting services utilized by the Advisers are not independent.
|
•
|
Proxy voting records and Client requests to review proxy votes are not maintained. The Advisers have established the following guidelines as an attempt to mitigate these risks.
|
1.
|
The requesting PM Team’s reasons for the decision;
|
2.
|
The approval of the lead Portfolio Manager for the requesting PM Team;
|
3.
|
Notification to the Proxy Voting Team and other appropriate personnel (including other Advisers Portfolio Managers who may own the particular security);
|
4.
|
A determination that the decision is not influenced by any conflict of interest; and review and approval by the Compliance Department
|
|
|
1
The Advisers have various Portfolio Manager Teams organized by asset classes and investment strategies.
|
–
|
Restrictions for share blocking countries;
2
|
–
|
Casting a vote on a foreign security may require that the adviser engage a translator;
|
–
|
Restrictions on foreigners’ ability to exercise votes;
|
–
|
Requirements to vote proxies in person;
|
–
|
Requirements to provide local agents with power of attorney to facilitate the voting instructions;
|
–
|
Untimely notice of shareholder meeting;
|
–
|
Restrictions on the sale of securities for a period of time in proximity to the shareholder meeting.
|
|
|
2
In certain markets where share blocking occurs, shares must be “frozen” for trading purposes at the custodian or sub-custodian in order to vote. During the time that shares are blocked, any pending trades will not settle. Depending on the market, this period can last from one day to three weeks. Any sales that must be executed will settle late and potentially be subject to interest charges or other punitive fees.
|
•
|
Any request, whether written (including e-mail) or oral, received by any Employee of the Advisers, must be promptly reported to the Proxy Voting Team. All written requests must be retained in the Client’s permanent file.
|
•
|
The Proxy Voting Team records the identity of the Client, the date of the request, and the disposition (e.g., provided a written or oral response to Client’s request, referred to third party, not a proxy voting client, other dispositions, etc.) in a suitable place.
|
•
|
The Proxy Voting Team furnishes the information requested to the Client within a reasonable time period (generally within 10 business days). The Advisers maintain a copy of the written record provided in response to Client’s written (including e-mail) or oral request. A copy of the written response should be attached and maintained with the Client’s written request, if applicable and maintained in the permanent file.
|
•
|
Clients are permitted to request the proxy voting record for the 5 year period prior to their request.
|
•
|
Upon inadvertent receipt of a proxy, the Advisers forward the proxy to ISS for voting, unless the client has instructed otherwise.
|
•
|
The Advisers’ proxy voting record is maintained by ISS. The Proxy Voting Team, with the assistance of the Investment Accounting and SMA Operations Departments, periodically ensures that ISS has complete, accurate, and current records of Clients who have instructed the Advisers to vote proxies on their behalf.
|
•
|
The Advisers maintain documentation to support the decision to vote against the ISS recommendation.
|
•
|
The Advisers maintain documentation or any communications received from third parties, other industry analysts, third party service providers, company’s management discussions, etc. that were material in the basis for any voting decision.
|
•
|
That Spectrum act solely in the interest of its clients in providing for ultimate long-term stockholder value.
|
•
|
That Spectrum act without undue influence from individuals or groups who may have an economic interest in the outcome of a proxy vote.
|
•
|
That the custodian bank is aware of our fiduciary duty to vote proxies on behalf of others – Spectrum relies on the best efforts of the custodian bank to deliver all proxies we are entitled to vote.
|
•
|
That Spectrum will exercise its right to vote all proxies on behalf of its clients (or permit clients to vote their interest, as the case(s) may be).
|
•
|
That Spectrum will implement a reasonable and sound basis to vote proxies.
|
A.
|
Following ISS’ Recommendations
|
B.
|
Disregarding ISS’ Recommendations
|
•
|
Business Relationships – The CCO will consider whether Spectrum (or an affiliate) has a substantial business relationship with a portfolio company or a proponent of a proxy proposal relating to the portfolio company (e.g., an employee group), such that failure to vote in favor of management (or the proponent) could harm the adviser’s relationship with the company (or proponent). For example, if Spectrum manages money for the portfolio company or an employee group, manages pension assets, leases office space from the company, or provides other material services to the portfolio company, the CCO will review whether such relationships may give rise to a conflict of interest.
|
•
|
Personal Relationships – The CCO will consider whether any senior executives or portfolio managers (or similar persons at Spectrum’s affiliates) have a personal relationship with other proponents of proxy proposals, participants in proxy contests, corporate directors, or candidates for directorships that might give rise to a conflict of interest.
|
•
|
Familial Relationships – The CCO will consider whether any senior executives or portfolio managers (or similar persons at Spectrum’s affiliates) have a familial relationship relating to a portfolio company (e.g., a spouse or other relative who serves as a director of a portfolio company, is a candidate for such a position, or is employed by a portfolio company in a senior position).
|
•
|
A list of clients that are also public companies, which is prepared and updated by the Operations Department and retained in the Compliance Department.
|
•
|
Publicly available information.
|
•
|
Information generally known within Spectrum.
|
•
|
Information actually known by senior executives or portfolio managers. When considering a proxy proposal, investment professionals involved in the decision-making process must disclose any potential material conflict that they are aware of to the CCO prior to any substantive discussion of a proxy matter.
|
•
|
Information obtained periodically from those persons whom the CCO reasonably believes could be affected by a conflict arising from a personal or familial relationship (e.g., portfolio managers, senior management).
|
1.
|
Financial Materiality – The most likely indicator of materiality in most cases will be the dollar amount involved with the relationship in question. For purposes of proxy voting, it will be presumed that a conflict is not material unless it involves at least 5% of Spectrum’s annual revenues or a minimum dollar amount of $1,000,000. Different percentages or dollar amounts may be used depending on the nature and degree of the conflict (e.g., a higher number if the conflict arises through an affiliate rather than directly with Spectrum).
|
2.
|
Non-Financial Materiality – A non-financial conflict of interest might be material (e.g., conflicts involving personal or familial relationships) and should be evaluated based on the facts and circumstances of each case.
|
1.
|
selection of auditors
|
2.
|
increasing the authorized number of common shares
|
3.
|
election of unopposed directors
|
1.
|
Classification of Board of Directors
. Rather than electing all directors annually, these provisions stagger a board, generally into three annual classes, and call for only one-third to be elected each year. Staggered boards may help to ensure leadership continuity, but they also serve as defensive mechanisms. Classifying the board makes it more difficult to change control of a company through a proxy contest involving election of directors. In general, we vote on a case by case basis on proposals for staggered boards, but generally favor annual elections of all directors.
|
2.
|
Cumulative Voting of Directors
. Most corporations provide that shareholders are entitled to cast one vote for each director for each share owned - the one share, one vote standard. The process of cumulative voting, on the other hand, permits shareholders to distribute the total number of votes they have in any manner they wish when electing directors. Shareholders may possibly elect a minority representative to a corporate board by this process, ensuring representation for all sizes of shareholders. Outside shareholder involvement can encourage management to maximize share value. We generally support cumulative voting of directors.
|
3.
|
Prevention of Greenmail
. These proposals seek to prevent the practice of “greenmail”, or targeted share repurchases by management of company stock from individuals or groups seeking control of the company. Since only the hostile party receives payment, usually at a substantial premium over the market value of its shares, the practice discriminates against all other shareholders. By making greenmail payments, management transfers significant sums of corporate cash to one entity, most often for the primary purpose of saving their jobs. Shareholders are left with an asset-depleted and often less competitive company. We think that if a corporation offers to buy back its stock, the offer should be made to all shareholders, not just to a select group or individual. We are opposed to greenmail and will support greenmail prevention proposals.
|
4.
|
Supermajority Provisions
. These corporate charter amendments generally require that a very high percentage of share votes (70-81%) be cast affirmatively to approve a merger, unless the board of directors has approved it in advance. These provisions have the potential to give management veto power over merging with another company, even though a majority of shareholders favor the merger. In most cases we believe requiring supermajority approval of mergers places too much veto power in the hands of management and other minority shareholders, at the expense of the majority shareholders, and we oppose such provisions.
|
5.
|
Defensive Strategies
. These proposals will be analyzed on a case by case basis to determine the effect on shareholder value. Our decision will be based on whether the proposal enhances long-term economic value.
|
6.
|
Business Combinations or Restructuring
. These proposals will be analyzed on a case by case basis to determine the effect on shareholder value. Our decision will be based on whether the proposal enhances long-term economic value.
|
7.
|
Executive and Director Compensation
. These proposals will be analyzed on a case by case basis to determine the effect on shareholder value. Our decision will be based on whether the proposal enhances long-term economic value.
|
|
|
|
|
|
|
|
|
|
Name of individual contacted:
|
|
|
Date:
|
|
Yes / No
|
|
|
Name of individual contacted:
|
|
|
Date:
|
|
8. Portfolio Manager Signature:
|
|
|
Date:
|
|
|
Portfolio Manager Name:
|
|
|
|
|
|
Portfolio Manager Signature*:
|
|
|
Date:
|
|
|
Portfolio Manager Name:
|
|
(a)
|
(i)
|
Certificate of Trust -- Filed as Exhibit 99.(a)(i) on 02/06/2015 (Accession No. 0001572661-15-000008)
|
|
|
(ii)
|
Agreement and Declaration of Trust Instrument -- Filed as Exhibit 99.(a)(ii) on 02/06/2015 (Accession No. 0001572661-15-000008)
|
|
(b)
|
By-laws effective 12/15/2015 -- Filed as Exhibit 99.(b) on 02/24/2016 (Accession No. 0001572661-16-000073)
|
||
(c)
|
Agreement and Declaration of Trust; Articles II, VII and IX, and By-Laws; Articles 2, 3, 9 and 10 -- Filed as Exhibit
99.(a)(ii) on 02/06/2015 (Accession No. 0001572661-15-000008)
|
||
(d)
|
Investment Advisory Agreement
|
||
|
(i)
|
a.
|
Amended and Restated Management Agreement with Principal Global Investors, LLC dated 10/01/2017 *
|
|
|
b.
|
Amended and Restated Management Agreement with Principal Global Investors, LLC dated 10/11/2017 *
|
|
|
c.
|
Amended and Restated Management Agreement with Principal Global Investors, LLC dated 10/18/2017 *
|
|
|
d.
|
Amended and Restated Management Agreement with Principal Global Investors, LLC dated 11/08/2017 *
|
|
(ii)
|
Form of Sub-Advisory Agreement with Morley Capital Management, LLC - Filed as Exhibit 99.(d)(ii) on 08/31/2017 (Accession No. 0001572661-17-000213)
|
|
|
(iii)
|
Sub-Advisory Agreement with Spectrum Asset Management, Inc. dated 07/10/2017 - Filed as Exhibit 99.(d)(v) on 07/20/2016 (Accession No. 0001572661-17-000193)
|
|
(e)
|
(i)
|
a.
|
Distribution Agreement with ALPS Distributors, Inc. dated 05/01/2015 -- Filed as Exhibit 99.(e)(i) on 10/27/2015 (Accession No. 0001572661-15-000049)
|
|
|
b.
|
Distribution Agreement Amendment No. 1 with ALPS Distributors, Inc. dated 02/23/2016 -- Filed as Exhibit 99.(e)(i)b on 05/05/2016 (Accession No. 0001572661-16-000132)
|
|
|
c.
|
Distribution Agreement Amendment No. 2 with ALPS Distributors, Inc. dated 08/15/2016 -- Filed as Exhibit 99.(e)(i)c on 09/19/2016 (Accession No. 0001572661-16-000207)
|
|
|
d.
|
Distribution Agreement Amendment No. 3 with ALPS Distributors, Inc. dated 09/21/2016 -- Filed as Exhibit 99.(e)(i)d on 10/27/2016 (Accession No. 0001572661-16-000234)
|
|
|
e.
|
Distribution Agreement Amendment No. 4 with ALPS Distributors, Inc. dated 05/08/2017 -- Filed as Exhibit 99.(e)(i)e on 08/29/2017 (Accession No. 0001572661-17-000205)
|
|
|
f.
|
Distribution Agreement Amendment No. 5 with ALPS Distributors, Inc. dated 07/10/2017 -- Filed as Exhibit 99.(e)(i)f on 08/29/2017 (Accession No. 0001572661-17-000205)
|
|
|
g.
|
Distribution Agreement Amendment No. 6 with ALPS Distributors, Inc. dated 09/06/2017 - Filed as Exhibit 99.(3)(i)g on 01/19/2018 (Accession No. 0001572661-18-000005)
|
|
|
h.
|
Distribution Agreement Amendment No. 7 with ALPS Distributors, Inc. dated 10/27/2017 - Filed as Exhibit 99.(3)(i)h on 01/19/2018 (Accession No. 0001572661-18-000005)
|
|
(ii)
|
Form of Authorized Participant Agreement -- Filed as Exhibit 99.(e)(ii) on 04/21/2015 (Accession No. 0001572661-15-000016)
|
|
(f)
|
Bonus, profit sharing or pension plans -- N/A
|
||
(g)
|
(i)
|
Custodian Agreement with State Street Bank and Trust Company dated 05/21/2015 -- Filed as Exhibit 99.(g) on 10/27/2015 (Accession No. 0001572661-15-000049)
|
|
|
(ii)
|
Custodian Agreement Amendment (letter) dated 03/11/2016 (Principal Shareholder Yield Index ETF and Principal Price Setters Index ETF) -- Filed as Exhibit 99.(g)(ii) on 08/18/2016 (Accession No. 0001572661-16-000191)
|
|
|
(iii)
|
Custodian Agreement Amendment (letter) dated 08/11/2016 (Principal Healthcare Innovators Index ETF and Principal Millennials Index ETF) - Filed as Exhibit 99.(g)(iii) on 10/27/2016 (Accession No. 0001572661-16-000234)
|
|
|
(iv)
|
Custodian Agreement Amendment (letter) dated 09/19/2016 (Principal U.S. Small Cap Index ETF) - Filed as Exhibit 99.(g)(iv) on 10/27/2016 (Accession No. 0001572661-16-000234)
|
|
|
(v)
|
Custodian Agreement Amendment (letter) dated 05/01/2017 (Principal Active Global Dividend Income ETF) -- Filed as Exhibit 99.(g)(v) on 08/29/2017 (Accession No. 0001572661-17-000205)
|
|
|
(vi)
|
Custodian Agreement Amendment (letter) dated 06/28/2017 (Principal Spectrum Preferred Securities Active ETF) -- Filed as Exhibit 99.(g)(vi) on 08/29/2017 (Accession No. 0001572661-17-000205)
|
|
|
(vii)
|
Custodian Agreement Amendment (letter) dated 08/22/2017 (Principal Morley Short Duration Index ETF) - Filed as Exhibit 99.(g)(vii) on 01/19/2018 (Accession No. 0001572661-18-000005)
|
|
|
(viii)
|
Custodian Agreement Amendment (letter) dated 09/29/2017 (Principal Contrarian Value Index ETF, Principal Emerging Markets Multi-Factor Index ETF, Principal International Multi-Factor Index ETF, Principal Sustainable Momentum Index ETF, and Principal U.S. Mega-Cap Multi-Factor Index ETF) - Filed as Exhibit 99.(g)(viii) on 01/19/2018 (Accession No. 0001572661-18-000005)
|
|
(ix)
|
Custodian Agreement Amendment (letter) dated __________ (Principal Investment Grade Corporate Active ETF) **
|
|
(h)
|
(i)
|
a.
|
Transfer Agency and Service Agreement with State Street Bank and Trust Company dated 05/21/2015 -- Filed as Exhibit 99.(h)(ii) on 10/27/2015 (Accession No. 0001572661-15-000049)
|
|
|
b.
|
Letter Amendment to Transfer Agency and Service Agreement with State Street Bank and Trust Company dated 03/11/2016 (Principal Shareholder Yield Index ETF and Principal Price Setters Index ETF) -- Filed as Exhibit 99.(h)(i)b on 05/08/2016 (Accession No. 0001572661-16-000132)
|
|
|
c.
|
Letter Amendment to Transfer Agency and Service Agreement with State Street Bank and Trust Company dated 06/28/17 (Principal Spectrum Preferred Securities Active ETF) -- Filed as Exhibit 99.(h)(i)c on 08/29/2017 (Accession No. 0001572661-17-000205)
|
|
|
d.
|
Letter Amendment to Transfer Agency and Service Agreement with State Street Bank and Trust Company dated 08/11/2016 (Principal Healthcare Innovators Index ETF and Principal Millennials Index ETF) *
|
|
|
e.
|
Letter Amendment to Transfer Agency and Service Agreement with State Street Bank and Trust Company dated 09/19/2016 (Principal U.S. Small Cap Index ETF) *
|
|
|
f.
|
Letter Amendment to Transfer Agency and Service Agreement with State Street Bank and Trust Company dated 05/01/2017 (Principal Active Global Dividend Income ETF) *
|
|
|
g.
|
Letter Amendment to Transfer Agency and Service Agreement with State Street Bank and Trust Company dated 09/29/2017 (Principal Contrarian Value Index ETF, Principal Emerging Markets Multi-Factor Index ETF, Principal International Multi-Factor Index ETF, Principal Sustainable Momentum Index ETF, and Principal U.S. Mega-Cap Multi-Factor Index ETF) *
|
|
|
h.
|
Letter Amendment to Transfer Agency and Service Agreement with State Street Bank and Trust Company dated _____________ (Principal Investment Grade Corporate Active ETF) **
|
|
(ii)
|
a.
|
Contractual Fee Waiver Agreement dated 07/01/2017 *
|
|
|
b.
|
Contractual Fee Waiver Agreement dated 10/10/2017 *
|
|
|
c.
|
Contractual Fee Waiver Agreement dated 11/01/2017 *
|
(i)
|
Legal Opinion *
|
||
(j)
|
(i)
|
Consent of Independent Registered Public Accounting Firm *
|
|
|
(ii)
|
Rule 485(b) Opinion *
|
|
|
(iii)
|
Powers of Attorney -- Filed as Exhibit 99(j)(ii) on 02/06/2015 (Accession No. 0001572661-15-000008), as Exhibit 99.(j)(iii) for E. A. Nickels on 10/27/2015 (Accession No. 0001572661-15-000049), and as Exhibit 99.(j)(iii) for P.G. Halter on 01/19/2018 (Accession No. 0001572661-18-000005)
|
|
(k)
|
Omitted Financial Statements -- N/A
|
||
(l)
|
(i)
|
Letter of Investment Intent dated 05/21/2015 (Principal EDGE Active Income ETF) -- Filed as Exhibit 99.(l) on 06/18/2015 (Accession No. 0001572661-15-000022)
|
|
|
(ii)
|
Letter of Investment Intent dated 03/21/2016 (Principal Shareholder Yield Index ETF and Principal Price Setters Index ETF) -- Filed as Exhibit 99.(l)(ii) on 05/05/2016 (Accession No. 0001572661-16-000132)
|
|
|
(iii)
|
Letter of Investment Intent dated 08/19/2016 (Principal Healthcare Innovators Index ETF and Principal Millennials Index ETF) -- Filed as Exhibit 99.(l)(iii) on 09/19/2016 (Accession No. 0001572661-16-000207)
|
|
|
(iv)
|
Letter of Investment Intent dated 09/21/2016 (Principal U.S. Small Cap Index ETF) - Filed as Exhibit 99(l)(iv) on 10/27/2016 (Accession No. 0001572661-16-000234)
|
|
|
(v)
|
Letter of Investment Intent dated 05/09/2017 (Principal Active Global Dividend ETF) - Filed as Exhibit 99(l)(v) on 10/10/2017 (Accession No. 0001572661-17-000265)
|
|
|
(vi)
|
Letter of Investment Intent dated 07/10/2017 (Principal Spectrum Preferred Securities Active ETF) - Filed as Exhibit 99(l)(vi) on 10/10/2017 (Accession No. 0001572661-17-000265)
|
|
|
(vii)
|
Letter of Investment Intent dated ___________________ (Principal Morley Short Duration Index ETF) **
|
|
|
(viii)
|
Letter of Investment Intent dated 10/10/2017 (Principal U.S. Mega-Cap Multi-Factor Index ETF) - Filed as Exhibit 99(l)(viii) on 10/10/2017 (Accession No. 0001572661-17-000265)
|
|
|
(ix)
|
Letter of Investment Intent dated 10/18/2017 (Principal Contrarian Value Index ETF and Principal Sustainable Momentum Index ETF) - Filed as Exhibit 99(l)(ix) on 10/27/2017 (Accession No. 0001572661-17-000285)
|
|
|
(x)
|
Letter of Investment Intent dated 11/08/2017 (Principal International Multi-Factor Index ETF) - Filed as Exhibit 99(l)(x) on 01/19/2018 (Accession No. 0001572661-18-000005)
|
|
|
(xi)
|
Letter of Investment Intent dated ___________ (Principal Investment Grade Corporate Active ETF) **
|
|
(m)
|
Form of Distribution Plan and Agreement Pursuant to Rule 12b-1 with respect to shares of the Registrant *
|
||
(n)
|
Plan Pursuant to Rule 18f-3 under the 1940 Act -- N/A
|
||
(o)
|
Reserved.
|
(p)
|
(i)
|
Code of Ethics of Registrant dated 01/01/2016 -- Filed as Exhibit 99(p)(i) on 02/24/2016 (Accession No. 0001572661-16-000073)
|
|
|
(ii)
|
Code of Ethics of Morley Capital Management, LLC dated 02/2016 -- Filed as Exhibit 99(p)(ii) on 08/31/2017 (Accession No. 0001572661-17-000213)
|
|
|
(iii)
|
Code of Ethics of Principal Global Investors, LLC dated 01/01/2015 -- Filed as Exhibit 99(p)(iii) on 02/24/2016 (Accession No. 0001572661-16-000073)
|
|
|
(iv)
|
Code of Ethics of Spectrum Asset Management, Inc. dated 01/01/2011 -- Filed as Exhibit 99(p)(iii) on 07/06/2017 (Accession No. 0001572661-17-000176)
|
|
NAME
|
OFFICE WITH INVESTMENT ADVISOR (PGI)
|
|
|
|
|
Aleda Anderson
|
Director - Strategy and Operations
|
|
|
|
|
Robert F. Baur
|
Executive Director - Chief Global Economist
|
|
NAME
|
OFFICE WITH INVESTMENT ADVISOR (PGI)
|
|
Andrea Kyle Muller
|
Executive Director - Institutional Business
|
|
|
|
|
Brian S. Ness
|
Executive Director - Operations & IT
|
|
|
|
|
Charles Nichols
|
Counsel
|
|
|
|
|
Joelle L. Palmer
|
Counsel
|
|
|
|
|
Karen A. Pearston
|
Vice President and Associate General Counsel
|
|
|
|
|
Colin D. Pennycooke
|
Counsel
|
|
|
|
|
Thomas R. Pospisil
|
Assistant General Counsel
|
|
|
|
|
Christopher J. Reddy
|
Executive Director - Product & Marketing
|
|
|
|
*
|
Teri Root
|
Deputy Chief Compliance Officer
|
|
|
|
|
Kelly D. Rush
|
Chief Investment Officer Global RE Securities
|
|
|
|
|
Mustafa Sagun
|
Chief Investment Officer - PGI Equities
|
|
|
|
|
Charles M. Schneider
|
Counsel
|
|
|
|
|
Mary E. Schwarze
|
Counsel
|
|
|
|
|
Karen E. Shaff
|
Executive Vice President, General Counsel, Secretary, and Director
|
|
|
|
*
|
Adam U. Shaikh
|
Counsel
|
|
|
|
|
Bridget C. Shapansky
|
Counsel
|
|
|
|
|
Ellen W. Shumway
|
Senior Executive Director - Strategy and Investments
|
|
|
|
|
Debra Svoboda Epp
|
Assistant General Counsel
|
|
|
|
|
JoEllen J. Watts
|
Counsel
|
|
|
|
|
Kenneth Kirk West
|
Executive Director - Investments
|
|
|
|
*
|
Dan L. Westholm
|
Assistant Vice President/Treasury
|
|
|
|
|
Jared A. Yepsen
|
Counsel
|
|
|
|
|
Douglas E. Younkin
|
Head Institutional Distribution and RM
|
NAME*
|
|
POSITIONS AND OFFICES
WITH PRINCIPAL UNDERWRITER (ALPS)
|
|
POSITIONS AND OFFICES
WITH THE FUND
|
Edmund J. Burke
|
|
Director
|
|
None
|
Jeremy O. May
|
|
President, Director
|
|
None
|
Bradley J. Swenson
|
|
Senior Vice President, Chief Operating Officer
|
|
None
|
Robert J. Szydlowski
|
|
Senior Vice President, Chief Technology Officer
|
|
None
|
Eric T. Parsons
|
|
Vice President, Controller and Assistant Treasurer
|
|
None
|
Randall D. Young**
|
|
Secretary
|
|
None
|
Gregg Wm. Givens**
|
|
Vice President, Treasurer and Assistant Secretary
|
|
None
|
Douglas W. Fleming**
|
|
Assistant Treasurer
|
|
None
|
Steven Price
|
|
Senior Vice President, Chief Compliance Officer
|
|
None
|
Liza Orr
|
|
Vice President, Senior Counsel
|
|
None
|
Jed Stahl
|
|
Vice President, Senior Counsel
|
|
None
|
Josh Eihausen
|
|
Vice President, Associate Senior Counsel
|
|
|
Troy A. Duran
|
|
Senior Vice President, Chief Financial Officer
|
|
None
|
James Stegall
|
|
Vice President
|
|
None
|
Gary Ross
|
|
Senior Vice President
|
|
None
|
Kevin Ireland
|
|
Senior Vice President
|
|
None
|
Mark Kiniry
|
|
Senior Vice President
|
|
None
|
Tison Cory
|
|
Vice President, Intermediary Operations
|
|
None
|
Hilary Quinn
|
|
Vice President
|
|
None
|
Jennifer Craig
|
|
Assistant Vice President
|
|
None
|
*
|
Except as otherwise noted, the principal business address for each of the above directors and executive officers is 1290 Broadway, Suite 1100, Denver, Colorado 80203.
|
**
|
The principal business address for Messrs. Young, Givens and Fleming is 333 W. 11
th
Street, 5
th
Floor, Kansas City, Missouri 64105.
|
SIGNATURES
|
|
|
|
Pursuant to the requirements of the Securities Act of 1933 and the Investment Company Act of 1940, the Fund certifies that it meets all of the requirement for effectiveness of this registration statement under rule 485(b) under the Securities Act and has duly caused this registration statement to be signed on its behalf by the undersigned, duly authorized, in the city of Des Moines and State of Iowa, on the 13th day of April, 2018.
|
|
|
|
|
Principal Exchange-Traded Funds
|
|
(Registrant)
|
|
/s/ M. J. Beer
_____________________________________
M. J. Beer
Director, President and Chief Executive Officer
|
|
|
Attest:
/s/ Beth Wilson
______________________________________
Beth Wilson
Vice President and Secretary
|
|
Pursuant to the requirements of the Securities Act of 1933, this Amendment to the Registration Statement has been signed below by the following persons in the capacities and on the dates indicated.
|
|||
Signature
|
Title
|
Date
|
|
|
|
|
|
/s/ M. J. Beer
__________________________
M. J. Beer
|
Director, President and
Chief Executive Officer
(Principal Executive Officer)
|
April 13, 2018
|
|
|
|
||
/s/ T. W. Bollin
__________________________
T. W. Bollin
|
Chief Financial Officer
(Principal Financial Officer)
|
April 13, 2018
|
|
|
|
|
|
/s/ S. L. Reece
__________________________
S. L. Reece
|
Vice President and Controller
(Controller)
|
April 13, 2018
|
|
|
|
||
(E. Ballantine)*
__________________________
E. Ballantine
|
Trustee
|
April 13, 2018
|
|
|
|
||
(L. T. Barnes)*
__________________________
L. T. Barnes
|
Trustee
|
April 13, 2018
|
|
|
|
||
(C. Damos)*
__________________________
C. Damos
|
Trustee
|
April 13, 2018
|
|
|
|
||
(N. M. Everett)*
__________________________
N. M. Everett
|
Chair
|
April 13, 2018
|
|
|
|
||
(M. A. Grimmett)*
__________________________
M. A. Grimmett
|
Trustee
|
April 13, 2018
|
|
|
|
||
(P. G. Halter)*
__________________________
P. G. Halter
|
Trustee
|
April 13, 2018
|
|
|
|
||
(F. S. Hirsch)*
__________________________
F. S. Hirsch
|
Trustee
|
April 13, 2018
|
|
|
|
||
(T. Huang)*
__________________________
T. Huang
|
Trustee
|
April 13, 2018
|
|
|
|
||
(K. McMillan)*
__________________________
K. McMillan
|
Trustee
|
April 13, 2018
|
|
|
|
||
(E. A. Nickels)*
__________________________
E. A. Nickels
|
Trustee
|
April 13, 2018
|
|
|
|
||
|
|
|
|
*
Pursuant to Power of Attorney appointing M. J. Beer
Previously Filed as Ex-99(j)(ii) on February 6, 2015 (Accession No. 0001572661-15-000008), for E. A. Nickels on October 27, 2015 (Accession No. 0001572661-15-000049), and for. P. G. Halter on January 19, 2018 (Accession No. 0001572661-18-000005)
|
(a)
|
Agreement and Declaration of Trust of the Fund;
|
(b)
|
Bylaws of the Fund as adopted by the Board of Trustees; and
|
(c)
|
Resolutions of the Board of Trustees of the Fund selecting the Manager as investment adviser for each Series and approving the form of this Agreement with respect to each such Series; and
|
(a)
|
Provide investment research, advice and supervision;
|
(b)
|
Provide investment advisory, research and statistical facilities and all clerical services relating to research, statistical and investment work;
|
(c)
|
Furnish to the Board of Trustees of the Fund (or any appropriate committee of such Board), and provide ongoing review, evaluation and revision from time to time as conditions require of, a recommended investment program for the portfolio of each Series of the Fund consistent with each Series' investment objective and policies, including any recommendation for any combination of liquidation of Series;
|
(d)
|
Where applicable, based on upon research, analysis and due diligence, recommend to the Board of Trustees of the Fund one or more sub-advisers for a Series of the Fund; regularly monitor and evaluate each sub-adviser’s performance and recommend changes to the sub-advisers in situations in which appropriate.
|
(e)
|
Implement such of its recommended investment program for each Series as the Fund shall approve, by placing orders for the purchase and sale of securities, subject always to the provisions of the Fund’s Agreement and Declaration of Trust and Bylaws and the
|
(f)
|
Advise and assist the officers of the Fund in taking such steps as are necessary or appropriate to carry out the decisions of its Board of Trustees and any appropriate committees of such Board regarding the general conduct of the investment business of each Series; and
|
(g)
|
Report to the Board of Trustees of the Fund at such times and in such detail as the Board may deem appropriate in order to enable it to determine that the investment policies of each Series are being observed.
|
(a)
|
Maintain fund general ledger and journal;
|
(b)
|
Prepare and record disbursements for direct expenses of each Series;
|
(c)
|
Prepare daily money transfer;
|
(d)
|
Reconcile all bank and custodian accounts of each Series;
|
(e)
|
Assist Fund independent auditors as appropriate;
|
(f)
|
Prepare daily projection of available cash balances;
|
(g)
|
Record trading activity for purposes of determining net asset values and daily dividend;
|
(h)
|
Prepare daily portfolio valuation report to value portfolio securities and determine daily accrued income;
|
(i)
|
Determine the net asset value per share if each Series daily or at such other intervals as the Fund may reasonably request or as may be required by law;
|
(j)
|
Prepare monthly, quarterly, semi-annual and annual financial statements;
|
(k)
|
Provide financial information for reports to the Securities and Exchange Commission (the “SEC”) in compliance with the provisions of the 1940 Act and the Securities Act of 1933, as amended the (the “Securities Act”), the Internal Revenue Service and any other regulatory or governmental agencies as required;
|
(l)
|
Provide financial, yield, net asset value, and similar information to National Association of Securities Dealers, Inc., and other survey and statistical agencies as instructed from time to time by the Fund;
|
(m)
|
Investigate, assist in the selection of and conduct relations with custodians, depositories, accountants, legal counsel, insurers, banks and persons in any other capacity deemed to be necessary or desirable for the operations of each Series; and
|
(n)
|
Obtain and keep in effect fidelity bonds and trustees and officers/errors and omissions insurance policies for the Fund in accordance with the requirements of the 1940 Act and the rules thereunder, as such bonds and policies are approved by the Fund's Board of Trustees.
|
3.
|
TRUST ADMINISTRATIVE SERVICES
|
(a)
|
furnish the services of such of the Manager's officers and employees as may be elected officers or trustees of the Fund, subject to their individual consent to serve and to any limitations imposed by law;
|
(b)
|
furnish office space, and all necessary office facilities and equipment, for the general trust functions of the Fund (i.e., functions other than (i) underwriting and distribution of the shares of each Series; (ii) custody of the assets of each Series, (iii) transfer and paying agency services; and (iv) corporate and portfolio accounting services);
|
(c)
|
furnish the services of executive and clerical personnel necessary to perform the general trust functions of the Fund.
|
(d)
|
design, develop, implement and regularly monitor appropriate compliance processes; and
|
(e)
|
prepare, or provide oversight and review of the preparation of, registration statements, shareholder reports and other disclosure materials and regulatory filings for each Series.
|
|
PRINCIPAL EXCHANGE-TRADED FUNDS
|
|
|
|
|
|
|
|
|
By
|
/s/ Adam U. Shaikh
|
|
|
Adam U. Shaikh, Assistant Counsel
|
|
|
|
|
|
|
|
By
|
/s/ Beth C. Wilson
|
|
|
Beth C. Wilson, Vice President & Secretary
|
|
|
|
|
|
|
|
PRINCIPAL GLOBAL INVESTORS, LLC
|
|
|
|
|
|
|
|
|
By
|
/s/ Michael J. Beer
|
|
|
Michael J. Beer, Executive Director - Principal Funds
|
|
|
|
|
By
|
/s/ Adam U. Shaikh
|
|
|
Adam U. Shaikh, Counsel
|
Series
|
Management Fee as a Percentage
of Average Daily Net Assets
|
|||
First $500 million
|
Next $500 million
|
Next $500 million
|
Over $1.5 billion
|
|
Principal Healthcare Innovators Index ETF
|
0.42%
|
0.40%
|
0.38%
|
0.37%
|
Principal Millennials Index ETF
|
0.45%
|
0.43%
|
0.41%
|
0.40%
|
Principal Price Setters Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Principal Shareholder Yield Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Series
|
Management Fee as a Percentage of
Average Daily Net Assets All Assets
|
Principal Active Global Dividend Income ETF
|
0.58%
|
Principal EDGE Active Income ETF
|
0.65%
|
Principal Spectrum Preferred Securities Active ETF
|
0.55%
|
Principal U.S. Small Cap Index ETF
|
0.38%
|
Series
|
Effective Date
|
Initial Term
|
Principal Active Global Dividend Income ETF
|
5/8/2017
|
Two Years
|
Principal EDGE Active Income ETF
|
7/8/2015
|
Two Years
|
Principal Healthcare Innovators Index ETF
|
8/19/2016
|
Two Years
|
Principal Millennials Index ETF
|
8/19/2016
|
Two Years
|
Principal Price Setters Index ETF
|
3/21/2016
|
Two Years
|
Principal Shareholder Yield Index ETF
|
3/21/2016
|
Two Years
|
Principal Spectrum Preferred Securities Active ETF
|
7/10/2017
|
Two Years
|
Principal U.S. Small Cap Index ETF
|
09/21/2016
|
Two Years
|
(a)
|
Agreement and Declaration of Trust of the Fund;
|
(b)
|
Bylaws of the Fund as adopted by the Board of Trustees; and
|
(c)
|
Resolutions of the Board of Trustees of the Fund selecting the Manager as investment adviser for each Series and approving the form of this Agreement with respect to each such Series; and
|
(a)
|
Provide investment research, advice and supervision;
|
(b)
|
Provide investment advisory, research and statistical facilities and all clerical services relating to research, statistical and investment work;
|
(c)
|
Furnish to the Board of Trustees of the Fund (or any appropriate committee of such Board), and provide ongoing review, evaluation and revision from time to time as conditions require of, a recommended investment program for the portfolio of each Series of the Fund consistent with each Series' investment objective and policies, including any recommendation for any combination of liquidation of Series;
|
(d)
|
Where applicable, based on upon research, analysis and due diligence, recommend to the Board of Trustees of the Fund one or more sub-advisers for a Series of the Fund; regularly monitor and evaluate each sub-adviser’s performance and recommend changes to the sub-advisers in situations in which appropriate.
|
(e)
|
Implement such of its recommended investment program for each Series as the Fund shall approve, by placing orders for the purchase and sale of securities, subject always to the provisions of the Fund’s Agreement and Declaration of Trust and Bylaws and the
|
(f)
|
Advise and assist the officers of the Fund in taking such steps as are necessary or appropriate to carry out the decisions of its Board of Trustees and any appropriate committees of such Board regarding the general conduct of the investment business of each Series; and
|
(g)
|
Report to the Board of Trustees of the Fund at such times and in such detail as the Board may deem appropriate in order to enable it to determine that the investment policies of each Series are being observed.
|
(a)
|
Maintain fund general ledger and journal;
|
(b)
|
Prepare and record disbursements for direct expenses of each Series;
|
(c)
|
Prepare daily money transfer;
|
(d)
|
Reconcile all bank and custodian accounts of each Series;
|
(e)
|
Assist Fund independent auditors as appropriate;
|
(f)
|
Prepare daily projection of available cash balances;
|
(g)
|
Record trading activity for purposes of determining net asset values and daily dividend;
|
(h)
|
Prepare daily portfolio valuation report to value portfolio securities and determine daily accrued income;
|
(i)
|
Determine the net asset value per share if each Series daily or at such other intervals as the Fund may reasonably request or as may be required by law;
|
(j)
|
Prepare monthly, quarterly, semi-annual and annual financial statements;
|
(k)
|
Provide financial information for reports to the Securities and Exchange Commission (the “SEC”) in compliance with the provisions of the 1940 Act and the Securities Act of 1933, as amended the (the “Securities Act”), the Internal Revenue Service and any other regulatory or governmental agencies as required;
|
(l)
|
Provide financial, yield, net asset value, and similar information to National Association of Securities Dealers, Inc., and other survey and statistical agencies as instructed from time to time by the Fund;
|
(m)
|
Investigate, assist in the selection of and conduct relations with custodians, depositories, accountants, legal counsel, insurers, banks and persons in any other capacity deemed to be necessary or desirable for the operations of each Series; and
|
(n)
|
Obtain and keep in effect fidelity bonds and trustees and officers/errors and omissions insurance policies for the Fund in accordance with the requirements of the 1940 Act and the rules thereunder, as such bonds and policies are approved by the Fund's Board of Trustees.
|
3.
|
TRUST ADMINISTRATIVE SERVICES
|
(a)
|
furnish the services of such of the Manager's officers and employees as may be elected officers or trustees of the Fund, subject to their individual consent to serve and to any limitations imposed by law;
|
(b)
|
furnish office space, and all necessary office facilities and equipment, for the general trust functions of the Fund (i.e., functions other than (i) underwriting and distribution of the shares of each Series; (ii) custody of the assets of each Series, (iii) transfer and paying agency services; and (iv) corporate and portfolio accounting services);
|
(c)
|
furnish the services of executive and clerical personnel necessary to perform the general trust functions of the Fund.
|
(d)
|
design, develop, implement and regularly monitor appropriate compliance processes; and
|
(e)
|
prepare, or provide oversight and review of the preparation of, registration statements, shareholder reports and other disclosure materials and regulatory filings for each Series.
|
|
PRINCIPAL EXCHANGE-TRADED FUNDS
|
|
|
|
|
|
|
|
|
By
|
/s/ Adam U. Shaikh
|
|
|
Adam U. Shaikh, Assistant Counsel
|
|
|
|
|
|
|
|
By
|
/s/ Beth C. Wilson
|
|
|
Beth C. Wilson, Vice President & Secretary
|
|
|
|
|
|
|
|
PRINCIPAL GLOBAL INVESTORS, LLC
|
|
|
|
|
|
|
|
|
By
|
/s/ Michael J. Beer
|
|
|
Michael J. Beer, Executive Director - Principal Funds
|
|
|
|
|
By
|
/s/ Adam U. Shaikh
|
|
|
Adam U. Shaikh, Counsel
|
Series
|
Management Fee as a Percentage
of Average Daily Net Assets
|
|||
First $500 million
|
Next $500 million
|
Next $500 million
|
Over $1.5 billion
|
|
Principal Healthcare Innovators Index ETF
|
0.42%
|
0.40%
|
0.38%
|
0.37%
|
Principal Millennials Index ETF
|
0.45%
|
0.43%
|
0.41%
|
0.40%
|
Principal Price Setters Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Principal Shareholder Yield Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Series
|
Management Fee as a Percentage of
Average Daily Net Assets All Assets
|
Principal Active Global Dividend Income ETF
|
0.58%
|
Principal EDGE Active Income ETF
|
0.65%
|
Principal Spectrum Preferred Securities Active ETF
|
0.55%
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
0.15%
|
Principal U.S. Small Cap Index ETF
|
0.38%
|
Series
|
Effective Date
|
Initial Term
|
Principal Active Global Dividend Income ETF
|
5/8/2017
|
Two Years
|
Principal EDGE Active Income ETF
|
7/8/2015
|
Two Years
|
Principal Healthcare Innovators Index ETF
|
8/19/2016
|
Two Years
|
Principal Millennials Index ETF
|
8/19/2016
|
Two Years
|
Principal Price Setters Index ETF
|
3/21/2016
|
Two Years
|
Principal Shareholder Yield Index ETF
|
3/21/2016
|
Two Years
|
Principal Spectrum Preferred Securities Active ETF
|
7/10/2017
|
Two Years
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
10/11/2017
|
Two Years
|
Principal U.S. Small Cap Index ETF
|
09/21/2016
|
Two Years
|
(a)
|
Agreement and Declaration of Trust of the Fund;
|
(b)
|
Bylaws of the Fund as adopted by the Board of Trustees; and
|
(c)
|
Resolutions of the Board of Trustees of the Fund selecting the Manager as investment adviser for each Series and approving the form of this Agreement with respect to each such Series; and
|
(a)
|
Provide investment research, advice and supervision;
|
(b)
|
Provide investment advisory, research and statistical facilities and all clerical services relating to research, statistical and investment work;
|
(c)
|
Furnish to the Board of Trustees of the Fund (or any appropriate committee of such Board), and provide ongoing review, evaluation and revision from time to time as conditions require of, a recommended investment program for the portfolio of each Series of the Fund consistent with each Series' investment objective and policies, including any recommendation for any combination of liquidation of Series;
|
(d)
|
Where applicable, based on upon research, analysis and due diligence, recommend to the Board of Trustees of the Fund one or more sub-advisers for a Series of the Fund; regularly monitor and evaluate each sub-adviser’s performance and recommend changes to the sub-advisers in situations in which appropriate.
|
(e)
|
Implement such of its recommended investment program for each Series as the Fund shall approve, by placing orders for the purchase and sale of securities, subject always to the provisions of the Fund’s Agreement and Declaration of Trust and Bylaws and the
|
(f)
|
Advise and assist the officers of the Fund in taking such steps as are necessary or appropriate to carry out the decisions of its Board of Trustees and any appropriate committees of such Board regarding the general conduct of the investment business of each Series; and
|
(g)
|
Report to the Board of Trustees of the Fund at such times and in such detail as the Board may deem appropriate in order to enable it to determine that the investment policies of each Series are being observed.
|
(a)
|
Maintain fund general ledger and journal;
|
(b)
|
Prepare and record disbursements for direct expenses of each Series;
|
(c)
|
Prepare daily money transfer;
|
(d)
|
Reconcile all bank and custodian accounts of each Series;
|
(e)
|
Assist Fund independent auditors as appropriate;
|
(f)
|
Prepare daily projection of available cash balances;
|
(g)
|
Record trading activity for purposes of determining net asset values and daily dividend;
|
(h)
|
Prepare daily portfolio valuation report to value portfolio securities and determine daily accrued income;
|
(i)
|
Determine the net asset value per share if each Series daily or at such other intervals as the Fund may reasonably request or as may be required by law;
|
(j)
|
Prepare monthly, quarterly, semi-annual and annual financial statements;
|
(k)
|
Provide financial information for reports to the Securities and Exchange Commission (the “SEC”) in compliance with the provisions of the 1940 Act and the Securities Act of 1933, as amended the (the “Securities Act”), the Internal Revenue Service and any other regulatory or governmental agencies as required;
|
(l)
|
Provide financial, yield, net asset value, and similar information to National Association of Securities Dealers, Inc., and other survey and statistical agencies as instructed from time to time by the Fund;
|
(m)
|
Investigate, assist in the selection of and conduct relations with custodians, depositories, accountants, legal counsel, insurers, banks and persons in any other capacity deemed to be necessary or desirable for the operations of each Series; and
|
(n)
|
Obtain and keep in effect fidelity bonds and trustees and officers/errors and omissions insurance policies for the Fund in accordance with the requirements of the 1940 Act and the rules thereunder, as such bonds and policies are approved by the Fund's Board of Trustees.
|
3.
|
TRUST ADMINISTRATIVE SERVICES
|
(a)
|
furnish the services of such of the Manager's officers and employees as may be elected officers or trustees of the Fund, subject to their individual consent to serve and to any limitations imposed by law;
|
(b)
|
furnish office space, and all necessary office facilities and equipment, for the general trust functions of the Fund (i.e., functions other than (i) underwriting and distribution of the shares of each Series; (ii) custody of the assets of each Series, (iii) transfer and paying agency services; and (iv) corporate and portfolio accounting services);
|
(c)
|
furnish the services of executive and clerical personnel necessary to perform the general trust functions of the Fund.
|
(d)
|
design, develop, implement and regularly monitor appropriate compliance processes; and
|
(e)
|
prepare, or provide oversight and review of the preparation of, registration statements, shareholder reports and other disclosure materials and regulatory filings for each Series.
|
|
PRINCIPAL EXCHANGE-TRADED FUNDS
|
|
|
|
|
|
|
|
|
By
|
/s/ Adam U. Shaikh
|
|
|
Adam U. Shaikh, Assistant Counsel
|
|
|
|
|
|
|
|
By
|
/s/ Beth C. Wilson
|
|
|
Beth C. Wilson, Vice President & Secretary
|
|
|
|
|
|
|
|
PRINCIPAL GLOBAL INVESTORS, LLC
|
|
|
|
|
|
|
|
|
By
|
/s/ Michael J. Beer
|
|
|
Michael J. Beer, Executive Director - Principal Funds
|
|
|
|
|
By
|
/s/ Adam U. Shaikh
|
|
|
Adam U. Shaikh, Counsel
|
Series
|
Management Fee as a Percentage
of Average Daily Net Assets
|
|||
First $500 million
|
Next $500 million
|
Next $500 million
|
Over $1.5 billion
|
|
Principal Healthcare Innovators Index ETF
|
0.42%
|
0.40%
|
0.38%
|
0.37%
|
Principal Millennials Index ETF
|
0.45%
|
0.43%
|
0.41%
|
0.40%
|
Principal Price Setters Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Principal Shareholder Yield Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Series
|
Management Fee as a Percentage of
Average Daily Net Assets All Assets
|
Principal Active Global Dividend Income ETF
|
0.58%
|
Principal Contrarian Value Index ETF
|
0.29%
|
Principal EDGE Active Income ETF
|
0.65%
|
Principal Spectrum Preferred Securities Active ETF
|
0.55%
|
Principal Sustainable Momentum Index ETF
|
0.29%
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
0.15%
|
Principal U.S. Small Cap Index ETF
|
0.38%
|
Series
|
Effective Date
|
Initial Term
|
Principal Active Global Dividend Income ETF
|
5/8/2017
|
Two Years
|
Principal EDGE Active Income ETF
|
7/8/2015
|
Two Years
|
Principal Contrarian Value Index ETF
|
10/18/2017
|
Two Years
|
Principal Healthcare Innovators Index ETF
|
8/19/2016
|
Two Years
|
Principal Millennials Index ETF
|
8/19/2016
|
Two Years
|
Principal Price Setters Index ETF
|
3/21/2016
|
Two Years
|
Principal Shareholder Yield Index ETF
|
3/21/2016
|
Two Years
|
Principal Spectrum Preferred Securities Active ETF
|
7/10/2017
|
Two Years
|
Principal Sustainable Momentum Index ETF
|
10/18/2017
|
Two Years
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
10/11/2017
|
Two Years
|
Principal U.S. Small Cap Index ETF
|
09/21/2016
|
Two Years
|
(a)
|
Agreement and Declaration of Trust of the Fund;
|
(b)
|
Bylaws of the Fund as adopted by the Board of Trustees; and
|
(c)
|
Resolutions of the Board of Trustees of the Fund selecting the Manager as investment adviser for each Series and approving the form of this Agreement with respect to each such Series; and
|
(a)
|
Provide investment research, advice and supervision;
|
(b)
|
Provide investment advisory, research and statistical facilities and all clerical services relating to research, statistical and investment work;
|
(c)
|
Furnish to the Board of Trustees of the Fund (or any appropriate committee of such Board), and provide ongoing review, evaluation and revision from time to time as conditions require of, a recommended investment program for the portfolio of each Series of the Fund consistent with each Series' investment objective and policies, including any recommendation for any combination of liquidation of Series;
|
(d)
|
Where applicable, based on upon research, analysis and due diligence, recommend to the Board of Trustees of the Fund one or more sub-advisers for a Series of the Fund; regularly monitor and evaluate each sub-adviser’s performance and recommend changes to the sub-advisers in situations in which appropriate.
|
(e)
|
Implement such of its recommended investment program for each Series as the Fund shall approve, by placing orders for the purchase and sale of securities, subject always to the provisions of the Fund’s Agreement and Declaration of Trust and Bylaws and the requirements of the Investment Company Act of 1940, as amended (the “1940 Act”), and the Fund’s Registration Statement, current Prospectus and Statement of Additional Information, as each of the same shall be from time to time in effect;
|
(f)
|
Advise and assist the officers of the Fund in taking such steps as are necessary or appropriate to carry out the decisions of its Board of Trustees and any appropriate committees of such Board regarding the general conduct of the investment business of each Series; and
|
(g)
|
Report to the Board of Trustees of the Fund at such times and in such detail as the Board may deem appropriate in order to enable it to determine that the investment policies of each Series are being observed.
|
(a)
|
Maintain fund general ledger and journal;
|
(b)
|
Prepare and record disbursements for direct expenses of each Series;
|
(c)
|
Prepare daily money transfer;
|
(d)
|
Reconcile all bank and custodian accounts of each Series;
|
(e)
|
Assist Fund independent auditors as appropriate;
|
(f)
|
Prepare daily projection of available cash balances;
|
(g)
|
Record trading activity for purposes of determining net asset values and daily dividend;
|
(h)
|
Prepare daily portfolio valuation report to value portfolio securities and determine daily accrued income;
|
(i)
|
Determine the net asset value per share if each Series daily or at such other intervals as the Fund may reasonably request or as may be required by law;
|
(j)
|
Prepare monthly, quarterly, semi-annual and annual financial statements;
|
(k)
|
Provide financial information for reports to the Securities and Exchange Commission (the “SEC”) in compliance with the provisions of the 1940 Act and the Securities Act of 1933, as amended the (the “Securities Act”), the Internal Revenue Service and any other regulatory or governmental agencies as required;
|
(l)
|
Provide financial, yield, net asset value, and similar information to National Association of Securities Dealers, Inc., and other survey and statistical agencies as instructed from time to time by the Fund;
|
(m)
|
Investigate, assist in the selection of and conduct relations with custodians, depositories, accountants, legal counsel, insurers, banks and persons in any other capacity deemed to be necessary or desirable for the operations of each Series; and
|
(n)
|
Obtain and keep in effect fidelity bonds and trustees and officers/errors and omissions insurance policies for the Fund in accordance with the requirements of the 1940 Act and the rules thereunder, as such bonds and policies are approved by the Fund's Board of Trustees.
|
3.
|
TRUST ADMINISTRATIVE SERVICES
|
(a)
|
furnish the services of such of the Manager's officers and employees as may be elected officers or trustees of the Fund, subject to their individual consent to serve and to any limitations imposed by law;
|
(b)
|
furnish office space, and all necessary office facilities and equipment, for the general trust functions of the Fund (i.e., functions other than (i) underwriting and distribution of the shares of each Series; (ii) custody of the assets of each Series, (iii) transfer and paying agency services; and (iv) corporate and portfolio accounting services);
|
(c)
|
furnish the services of executive and clerical personnel necessary to perform the general trust functions of the Fund.
|
(d)
|
design, develop, implement and regularly monitor appropriate compliance processes; and
|
(e)
|
prepare, or provide oversight and review of the preparation of, registration statements, shareholder reports and other disclosure materials and regulatory filings for each Series.
|
|
PRINCIPAL EXCHANGE-TRADED FUNDS
|
|
|
|
|
|
By
|
/s/ Adam U. Shaikh
|
|
|
Adam U. Shaikh, Assistant Counsel
|
|
|
|
|
By
|
/s/ Beth C. Wilson
|
|
|
Beth C. Wilson, Vice President & Secretary
|
|
|
|
|
PRINCIPAL GLOBAL INVESTORS, LLC
|
|
|
|
|
|
By
|
/s/ Michael J. Beer
|
|
|
Michael J. Beer, Executive Director - Principal Funds
|
|
|
|
|
By
|
/s/ Adam U. Shaikh
|
|
|
Adam U. Shaikh, Counsel
|
Series
|
Management Fee as a Percentage
of Average Daily Net Assets
|
|||
First $500 million
|
Next $500 million
|
Next $500 million
|
Over $1.5 billion
|
|
Principal Healthcare Innovators Index ETF
|
0.42%
|
0.40%
|
0.38%
|
0.37%
|
Principal Millennials Index ETF
|
0.45%
|
0.43%
|
0.41%
|
0.40%
|
Principal Price Setters Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Principal Shareholder Yield Index ETF
|
0.40%
|
0.38%
|
0.36%
|
0.35%
|
Series
|
Management Fee as a Percentage of
Average Daily Net Assets All Assets
|
Principal Active Global Dividend Income ETF
|
0.58%
|
Principal Contrarian Value Index ETF
|
0.29%
|
Principal EDGE Active Income ETF
|
0.65%
|
Principal International Multi-Factor Index ETF
|
0.39%
|
Principal Spectrum Preferred Securities Active ETF
|
0.55%
|
Principal Sustainable Momentum Index ETF
|
0.29%
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
0.15%
|
Principal U.S. Small Cap Index ETF
|
0.38%
|
Series
|
Effective Date
|
Initial Term
|
Principal Active Global Dividend Income ETF
|
05/08/2017
|
Two Years
|
Principal EDGE Active Income ETF
|
07/08/2015
|
Two Years
|
Principal Contrarian Value Index ETF
|
10/18/2017
|
Two Years
|
Principal Healthcare Innovators Index ETF
|
08/19/2016
|
Two Years
|
Principal International Multi-Factor Index ETF
|
11/08/2017
|
Two Years
|
Principal Millennials Index ETF
|
08/19/2016
|
Two Years
|
Principal Price Setters Index ETF
|
03/21//2016
|
Two Years
|
Principal Shareholder Yield Index ETF
|
03/21/2016
|
Two Years
|
Principal Spectrum Preferred Securities Active ETF
|
07/10/2017
|
Two Years
|
Principal Sustainable Momentum Index ETF
|
10/18/2017
|
Two Years
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
10/11/2017
|
Two Years
|
Principal U.S. Small Cap Index ETF
|
09/21/2016
|
Two Years
|
Principal Exchange-Traded Funds
711 High Street, Des Moines, IA 50392
515 247 5111 tel
|
|
Sincerely,
|
|
|
|
PRINCIPAL EXCHANGE-TRADED FUNDS
on behalf of:
Principal Millennials Index ETF
Principal Healthcare Innovators Index ETF
|
|
|
|
By:
|
/s/ Layne A. Rasmussen
|
Name:
|
Layne A. Rasmussen
|
Title:
|
Vice President and Controller, Duly Authorized
|
Agreed and Accepted:
|
|
|
|
STATE STREET BANK AND TRUST COMPANY
|
|
|
|
By:
|
/s/ Andrew Erickson
|
Name:
|
Andrew Erickson
|
Title:
|
Executive Vice President, Duly Authorized
|
|
|
Effective Date: July 21, 2016
|
Principal Exchange-Traded Funds
711 High Street, Des Moines, IA 50392
515 247 5111 tel
|
|
Sincerely,
|
|
|
|
PRINCIPAL EXCHANGE-TRADED FUNDS
on behalf of:
Principal U.S. Small Cap Index ETF
|
|
|
|
By:
|
/s/ Layne A. Rasmussen
|
Name:
|
Layne A. Rasmussen
|
Title:
|
Vice President and Controller, Duly Authorized
|
Agreed and Accepted:
|
|
|
|
STATE STREET BANK AND TRUST COMPANY
|
|
|
|
By:
|
/s/ Andrew Erickson
|
Name:
|
Andrew Erickson
|
Title:
|
Executive Vice President, Duly Authorized
|
|
|
Effective Date: September 21, 2016
|
Principal Exchange-Traded Funds
711 High Street, Des Moines, IA 50392
515 247 5111 tel
|
|
Sincerely,
|
|
|
|
PRINCIPAL EXCHANGE-TRADED FUNDS
on behalf of:
Principal Active Global Dividend Income ETF
|
|
|
|
By:
|
/s/ Layne A. Rasmussen
|
Name:
|
Layne A. Rasmussen
|
Title:
|
Vice President, Duly Authorized
|
Agreed and Accepted:
|
|
|
|
STATE STREET BANK AND TRUST COMPANY
|
|
|
|
By:
|
/s/ Andrew Erickson
|
Name:
|
Andrew Erickson
|
Title:
|
Executive Vice President, Duly Authorized
|
|
|
Effective Date: May 9, 2017
|
Principal Exchange-Traded Funds
711 High Street, Des Moines, IA 50392
515 247 5111 tel
|
|
Sincerely,
|
|
|
|
PRINCIPAL EXCHANGE-TRADED FUNDS
on behalf of:
Principal Contrarian Value Index ETF
Principal Emerging Markets Multi-Factor Index ETF
Principal International Multi-Factor Index ETF
Principal Sustainable Momentum Index ETF
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
|
|
|
By:
|
/s/ Layne A. Rasmussen
|
Name:
|
Layne A. Rasmussen
|
Title:
|
Vice President, Duly Authorized
|
Agreed and Accepted:
|
|
|
|
STATE STREET BANK AND TRUST COMPANY
|
|
|
|
By:
|
/s/ Andrew Erickson
|
Name:
|
Andrew Erickson
|
Title:
|
Executive Vice President, Duly Authorized
|
|
|
Effective Date: May 9, 2017
|
PRINCIPAL EXCHANGE-TRADED FUNDS, INC.
|
|
PRINCIPAL GLOBAL INVESTORS, LLC
|
||
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Michael J. Beer
|
|
By:
|
/s/ Michael J. Beer
|
Name:
|
Michael J. Beer
|
|
Name:
|
Michael J. Beer
|
Title:
|
President and Chief Executive Officer
|
|
Title:
|
Executive Director - Funds
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Beth C. Wilson
|
|
By:
|
/s/ Adam U. Shaikh
|
Name:
|
Beth C. Wilson
|
|
Name:
|
Adam U. Shaikh
|
Title:
|
Secretary and Vice President
|
|
Title:
|
Counsel
|
Series
|
|
Expiration
|
Principal EDGE Active Income ETF
|
0.65%
|
3/31/2018
|
Principal Price Setters Index ETF
|
0.29%
|
6/30/2018
|
Principal Shareholder Yield Index ETF
|
0.29%
|
6/30/2018
|
PRINCIPAL EXCHANGE-TRADED FUNDS, INC.
|
|
PRINCIPAL GLOBAL INVESTORS, LLC
|
||
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Michael J. Beer
|
|
By:
|
/s/ Michael J. Beer
|
Name:
|
Michael J. Beer
|
|
Name:
|
Michael J. Beer
|
Title:
|
President and Chief Executive Officer
|
|
Title:
|
Executive Director - Funds
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Beth C. Wilson
|
|
By:
|
/s/ Adam U. Shaikh
|
Name:
|
Beth C. Wilson
|
|
Name:
|
Adam U. Shaikh
|
Title:
|
Secretary and Vice President
|
|
Title:
|
Counsel
|
Series
|
|
Expiration
|
Principal Price Setters Index ETF
|
0.29%
|
6/30/2018
|
Principal Shareholder Yield Index ETF
|
0.29%
|
6/30/2018
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
0.12%
|
10/31/2018
|
PRINCIPAL EXCHANGE-TRADED FUNDS, INC.
|
|
PRINCIPAL GLOBAL INVESTORS, LLC
|
||
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Michael J. Beer
|
|
By:
|
/s/ Michael J. Beer
|
Name:
|
Michael J. Beer
|
|
Name:
|
Michael J. Beer
|
Title:
|
President and Chief Executive Officer
|
|
Title:
|
Executive Director - Funds
|
|
|
|
|
|
|
|
|
|
|
By:
|
/s/ Beth C. Wilson
|
|
By:
|
/s/ Adam U. Shaikh
|
Name:
|
Beth C. Wilson
|
|
Name:
|
Adam U. Shaikh
|
Title:
|
Secretary and Vice President
|
|
Title:
|
Counsel
|
Series
|
|
Expiration
|
Principal Price Setters Index ETF
|
0.29%
|
10/31/2018
|
Principal Shareholder Yield Index ETF
|
0.29%
|
10/31/2018
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
0.12%
|
10/31/2018
|
Principal Exchange-Traded Funds
711 High Street, Des Moines, IA 50392
515 247 5111 tel
|
|
RE:
|
Registration Statement on Form N-1A
|
Principal Exchange-Traded Funds
711 High Street, Des Moines, IA 50392
515 247 5111 tel
|
|
RE:
|
Principal Exchange-Traded Funds
|
1.
|
This Distribution and Service Plan (the “Plan”), when effective in accordance with its terms, shall be the written plan contemplated by Securities and Exchange Commission Rule 12b-1 under the Investment Company Act of 1940, as amended (the “Act”) for the shares of each Series identified in Appendix A, attached hereto (the “Series”)of the Principal Exchange-Traded Funds (the “Fund”).
|
2.
|
The Fund has entered into a Distribution Agreement on behalf of the Fund with the Distributor, under which the Distributor uses all reasonable efforts, consistent with its other business, to secure purchasers of shares of each Series of the Fund (the “Shares”). Such efforts may include, but neither are required to include nor are limited to, the following: (1) formulation and implementation of marketing and promotional activities, such as mail promotions and television, radio, newspaper, magazine and other mass media advertising; (2) preparation, printing and distribution of sales literature provided to the Fund’s shareholders and prospective shareholders; (3) preparation, printing and distribution of prospectuses and statements of additional information of the Fund and reports to recipients other than existing shareholders of the Fund; (4) obtaining such information, analyses and reports with respect to marketing and promotional activities as the Distributor may, from time to time, deem advisable; (5) making payment of sales commission, ongoing commissions and other payments to brokers, dealers, financial institutions or others who sell Shares pursuant to Selling Agreements; (6) paying compensation to registered representatives or other employees of the Distributor who engage in or support distribution of the Fund’s Shares; (7) paying compensation to, and expenses (including overhead and telephone expenses) of, the Distributor; (8) providing training, marketing and support to dealers and others with respect to the sale of Shares; (9) receiving and answering correspondence from prospective shareholders including distributing prospectuses, statements of additional information, and shareholder reports; (10) providing of facilities to answer questions from prospective investors about Shares; (11) complying with federal and state securities laws pertaining to the sale of Shares; (12) assisting investors in completing application forms and selecting dividend and other account options; (13) providing of other reasonable assistance in connection with the distribution of the Fund’s shares; (14) organizing and conducting of sales seminars and making payments in the form of transactional compensation or promotional incentives; and (15) such other distribution and services activities as the Fund determines may be paid for by the Fund pursuant to the terms of this Plan and in accordance with Rule 12b-1 of the Act.
|
3.
|
The Distribution Agreement also authorizes the Distributor to enter into Service Agreements with other selling dealers and with banks or other financial institutions to provide shareholder services to existing Fund shareholders, including without limitation, services such as furnishing information as to the status of shareholder accounts, responding to telephone and written inquiries of shareholders, and assisting Fund shareholders with tax information.
|
4.
|
In consideration for the services described above, and the expenses incurred by the Distributor pursuant to the Distribution Agreement and Paragraphs 2 and 3 hereof, all with respect to shares of a Series of the Fund, shares of each Series shall pay to the Distributor a fee at the annual rate as shown on Appendix A (or such lesser amount as the Fund Trustees may, from time to time, determine) of the average daily net assets of shares of such Series. This fee shall be accrued daily and paid monthly or at such other intervals, as the Fund Trustees shall determine. The determination of daily net assets shall be made at the close of business each day throughout the month and computed in the manner specified in the Fund’s then current Registration Statement for the determination of the net asset value of the Fund’s shares.
|
5.
|
The Fund presently pays, and will continue to pay, a management fee to Principal Management Corporation (the “Manager”) pursuant to a Management Agreement between the Fund and the Manager (the “Management Agreement”). It is recognized that the Manager may use its management fee revenue, as well as its past profits or its resources from any other source, to make payment to the Distributor with respect to any expenses incurred in connection with the distribution of shares, including the activities referred to in Paragraph 2 hereof. To the extent that the payment of management fees by the Fund to the Manager should be deemed to be indirect financing of
|
6.
|
This Plan shall not take effect until it has been approved (a) by a vote of at least a majority (as defined in the Act) of the outstanding shares of the Series of the Fund and (b) by votes of the majority of both (i) the Board of Trustees of the Fund, and (ii) those Trustees of the Fund who are not "interested persons" (as defined in the Act) of the Fund and who have no direct or indirect financial interest in the operation of this Plan or any agreements related to this Plan (the "Disinterested Trustees"), cast in person at a meeting called for the purpose of voting on this Plan or such agreements.
|
7.
|
Unless sooner terminated pursuant to Paragraph 6, this Plan shall continue in effect for a period of twelve months from the date it takes effect and thereafter shall continue in effect so long as such continuance is specifically approved at least annually in the manner provided for approval of this Plan in Paragraph 6(b).
|
8.
|
A representative of the Distributor shall provide to the Board and the Board shall review at least quarterly a written report of the amounts so expended and the purposes for which such expenditures were made.
|
9.
|
This Plan may be terminated at any time by vote of a majority of the Disinterested Trustees, or by vote of a majority (as defined in the Act) of the outstanding shares of the Series of the Fund.
|
10.
|
Any agreement of the Fund related to this Plan shall be in writing and shall provide:
|
A.
|
That such agreement may be terminated at any time, without payment of any penalty, by vote of a majority of the Disinterested Trustees or by a vote of a majority (as defined in the Act) of the outstanding shares of the Series of the Fund on not more than sixty (60) days' written notice to any other party to the agreement); and
|
B.
|
That such agreement shall terminate automatically in the event of its assignment.
|
11.
|
While the Plan is in effect, the Fund’s Board of Trustees shall satisfy the fund governance standards as defined in Securities and Exchange Commission Rule 0-1(a)(7).
|
12.
|
This Plan does not require the Manager or Distributor to perform any specific type or level of distribution activities or to incur any specific level of expenses for activities primarily intended to result in the sale of shares.
|
13.
|
The Fund shall preserve copies of this Plan and any related agreements and all reports made pursuant to Paragraph 8, for a period of not less than six years from the date of the Plan, or the agreements or such report, as the case may be, the first two years in an easily accessible place.
|
14.
|
This Plan may not be amended to increase materially the amount of Fees provided for in Paragraph 4 hereof unless such amendment is approved in the manner provided for initial approval in Paragraph 6 hereof and no other material amendment to this Plan shall be made unless approved in the manner provided for initial approval in Paragraph 6(b) hereof.
|
Series
|
Distribution or Service Fee
|
Principal Active Global Dividend Income ETF
|
0.25%
|
Principal EDGE Active Income ETF
|
0.25%
|
Principal Contrarian Value Index ETF
|
0.25%
|
Principal Healthcare Innovators Index ETF
|
0.25%
|
Principal International Multi-Factor Index ETF
|
0.25%
|
Principal Investment Grade Corporate Active ETF
|
0.25%
|
Principal Millennials Index ETF
|
0.25%
|
Principal Price Setters Index ETF
|
0.25%
|
Principal Shareholder Yield Index ETF
|
0.25%
|
Principal Spectrum Preferred Securities Active ETF
|
0.25%
|
Principal Sustainable Momentum Index ETF
|
0.25%
|
Principal U.S. Mega-Cap Multi-Factor Index ETF
|
0.25%
|
Principal U.S. Small Cap Multi-Factor Index ETF
|
0.25%
|