PRINCIPAL FUNDS, INC. AMENDED AND RESTATED SUB-ADVISORY AGREEMENT TORTOISE CAPITAL ADVISORS, LLC SUB-ADVISED FUNDS

PRINCIPAL FUNDS, INC.
AMENDED AND RESTATED SUB-ADVISORY AGREEMENT
TORTOISE CAPITAL ADVISORS, LLC SUB-ADVISED FUNDS
AGREEMENT executed as of March 16, 2010, by and between PRINCIPAL MANAGEMENT
CORPORATION, an Iowa corporation (hereinafter called "the Manager"), and TORTOISE CAPITAL
ADVISORS, L.L.C., a Delaware limited liability company (hereinafter called “the Sub-Advisor).
W I T N E S S E T H:
WHEREAS, the Manager is the manager and investment adviser to each Fund of the Principal Funds,
Inc., (the "Fund"), an open-end management investment company registered under the Investment
Company Act of 1940, as amended (the "1940 Act"); and
WHEREAS, the Manager desires to retain the Sub-Advisor to furnish it with portfolio selection and
related research and statistical services in connection with the investment advisory services for each
series identified in Appendix A ( hereinafter called the “Series”), which the Manager has agreed to
provide to the Fund, and the Sub-Advisor desires to furnish such services; and
WHEREAS, The Manager has furnished the Sub-Advisor with copies properly certified or authenticated
of each of the following and will promptly provide the Sub-Advisor with copies properly certified or
authenticated of any amendment or supplement thereto:
(a)	Management Agreement (the "Management Agreement") with the Fund;
(b)	The Fund's registration statement and financial statements as filed with the Securities and
	Exchange Commission;
(c)	The Fund's Articles of Incorporation and By-laws;
(d)	Policies, procedures or instructions adopted or approved by the Board of Directors of the Fund
	relating to obligations and services provided by the Sub-Advisor.
NOW, THEREFORE, in consideration of the premises and the terms and conditions hereinafter set
forth, the parties agree as follows:
1.	Appointment of Sub-Advisor
	In accordance with and subject to the Management Agreement, the Manager hereby appoints the
	Sub-Advisor to perform the services described in Section 2 below for investment and reinvestment
	of the securities and other assets of the Series, subject to the control and direction of the Manager
	and the Fund's Board of Directors, for the period and on the terms hereinafter set forth. The
	Sub-Advisor accepts such appointment and agrees to furnish the services hereinafter set forth for
	the compensation herein provided. The Sub-Advisor shall for all purposes herein be deemed to be
	an independent contractor and shall, except as expressly provided or authorized, have no authority
	to act for or represent the Fund or the Manager in any way or otherwise be deemed an agent of the
	Fund or the Manager.
2.	Obligations of and Services to be Provided by the Sub-Advisor
	The Sub-Advisor will:
	(a) Provide investment advisory services, including but not limited to research, advice and
	supervision for the Series.

(b)	Furnish to the Board of Directors of the Fund for approval (or any appropriate committee of
	such Board), and revise from time to time as economic conditions require, a recommended
	investment program for the Fund consistent with the Series’ investment objective and policies.
(c)	Implement the approved investment program by placing orders for the purchase and sale of
	securities without prior consultation with the Manager or the Board of Directors of the Fund
	and without regard to the length of time the securities have been held, the resulting rate of
	portfolio turnover or any tax considerations, subject always to the provisions of the Fund's
	Articles of Incorporation and Bylaws, the requirements of the 1940 Act, as each of the same
	shall be from time to time in effect.
(d)	Advise and assist the officers of the Fund, as requested by the officers, in taking such steps as
	are reasonably necessary or appropriate to carry out the decisions of its Board of Directors,
	and any appropriate committees of such Board, regarding the general conduct of the
	investment business of the Series.
(e)	Maintain, in connection with the Sub-Advisor’s investment advisory services provided to the
	Series, its compliance with the 1940 Act and the regulations adopted by the Securities and
	Exchange Commission thereunder and the Series’ investment strategies and restrictions as
	stated in the Fund’s prospectus and statement of additional information, subject to receipt of
	such additional information as may be required from the Manager and provided in accordance
	with Section 11(d) of this Agreement. The Sub-Advisor has no responsibility for the
	maintenance of Fund records except insofar as is directly related to the services it provides to
	the Series.
(f)	Report to the Board of Directors of the Fund at such times and in such detail as the Board of
	Directors may reasonably deem appropriate in order to enable it to determine that the
	investment policies, procedures and approved investment program of the Series are being
	observed.
(g)	Upon request, provide assistance in the determination of the fair value of certain securities
	when reliable market quotations are not readily available for purposes of calculating net asset
	value in accordance with procedures and methods established by the Fund's Board of
	Directors.
(h)	Furnish, at its own expense, (i) all necessary investment and management facilities, including
	salaries of clerical and other personnel required for it to execute its duties faithfully, and (ii)
	administrative facilities, including bookkeeping, clerical personnel and equipment necessary
	for the efficient conduct of its duties under this Agreement.
(i)	Open accounts with broker-dealers (“broker-dealers”), select broker-dealers to effect all
	transactions for the Series, place all necessary orders with broker-dealers or issuers (including
	affiliated broker-dealers), and negotiate commissions, if applicable. To the extent consistent
	with applicable law, purchase or sell orders for the Series may be aggregated with
	contemporaneous purchase or sell orders of other clients of the Sub-Advisor. In such event
	allocation of securities so sold or purchased, as well as the expenses incurred in the
	transaction, will be made by the Sub-Advisor in the manner the Sub-Advisor considers to be
	the most equitable and consistent with its fiduciary obligations to the Fund and to other clients.
	The Manager recognizes that, in some cases, this procedure may limit the size of the position
	that may be acquired or sold for the Series. The Sub-Advisor will report on such allocations at
	the request of the Manager, the Fund or the Fund’s Board of Directors providing such
	information as the number of aggregated trades to which the Series was a party, the broker-
	dealers to whom such trades were directed and the basis for the allocation for the aggregated
	trades. The Sub-Advisor shall use its best efforts to obtain execution of transactions for the
	Series at prices which are advantageous to the Series and at commission rates that are
	reasonable in relation to the benefits received. However, the Sub-Advisor may select brokers

	or dealers on the basis that they provide brokerage, research or other services or products to
	the Sub-Advisor. To the extent consistent with applicable law, the Sub-Advisor may cause the
	Series to pay a broker or dealer an amount of commission for effecting a securities transaction
	in excess of the amount of commission or dealer spread another broker or dealer would have
	charged for effecting that transaction if the Sub-Advisor determines in good faith that such
	amount of commission is reasonable in relation to the value of the brokerage and research
	products and/or services provided by such broker or dealer. This determination, with respect
	to brokerage and research products and/or services, may be viewed in terms of either that
	particular transaction or the overall responsibilities which the Sub-Advisor and its affiliates
	have with respect to the Series as well as to accounts over which they exercise investment
	discretion. Not all such services or products need be used by the Sub-Advisor in managing the
	Series. In addition, joint repurchase or other accounts may not be utilized by the Series except
	to the extent permitted under any exemptive order obtained by the Sub-Advisor provided that
	all conditions of such order are complied with.
(j)	Maintain all accounts, books and records with respect to the Series as are required of an
	investment advisor of a registered investment company pursuant to the 1940 Act and
	Investment Advisor’s Act of 1940 (the “Investment Advisor’s Act”), and the rules thereunder,
	and furnish the Fund and the Manager with such periodic and special reports as the Fund or
	Manager may reasonably request. In compliance with the requirements of Rule 31a-3 under
	the 1940 Act, the Sub-Advisor hereby agrees that all records that it maintains for the Series
	are the property of the Fund, agrees to preserve for the periods described by Rule 31a-2
	under the 1940 Act any records that it maintains for the Fund and that are required to be
	maintained by Rule 31a-1 under the 1940 Act, and further agrees to surrender promptly to the
	Fund any records that it maintains for the Series upon request by the Fund or the Manager.
(k)	Observe and comply with Rule 17j-1 under the 1940 Act and the Sub-Advisor’s Code of Ethics
	adopted pursuant to that Rule as the same may be amended from time to time. The Manager
	acknowledges receipt of a copy of Sub-Advisor’s current Code of Ethics. Sub-Advisor shall
	promptly forward to the Manager a copy of any material amendment to the Sub-Advisor’s
	Code of Ethics.
(l)	From time to time as the Manager or the Fund may request, furnish the requesting party
	reports on portfolio transactions and reports on investments held by the Series, all in such
	detail as the Manager or the Fund may reasonably request. The Sub-Advisor will make
	available its officers and employees to meet with the Fund’s Board of Directors at the Fund’s
	principal place of business on due notice to review the investments of the Series.
(m)	Provide such information as is customarily provided by a sub-advisor and may be required for
	the Fund or the Manager to comply with their respective obligations under applicable laws,
	including, without limitation, the Internal Revenue Code of 1986, as amended (the “Code”), the
	1940 Act, the Investment Advisers Act, the Securities Act of 1933, as amended (the
	“Securities Act”), and any state securities laws, and any rule or regulation thereunder. Sub-
	Advisor will advise Manager of any changes in Sub-Advisor’s managing directors within a
	reasonable time after any such change. Manager acknowledges receipt of Sub-Advisor’s
	Form ADV more than 48 hours prior to the execution of this Agreement.
(n)	Perform quarterly and annual tax compliance tests to monitor the Series’ compliance with
	Subchapter M of the Code and Section 817(h) of the Code, subject to receipt of such
	additional information as may be required from the Manager and provided in accordance with
	Section 11(d) of this Agreement. The Sub-Advisor shall notify the Manager immediately upon
	having a reasonable basis for believing that the Series has ceased to be in compliance or that
	it might not be in compliance in the future. If it is determined that the Series is not in
	compliance with the requirements noted above, the Sub-Advisor, in consultation with the
	Manager, will take prompt action to bring the Series back into compliance (to the extent
	possible) within the time permitted under the Code.

	(o)         Have the responsibility and authority to vote proxies solicited by, or with respect to, the issuers
	of securities held in the Series. The Manager shall cause to be forwarded to Sub-Advisor all
	proxy solicitation materials that it receives and shall assist Sub-Advisor in its efforts to conduct
	the proxy voting process.
3.	Prohibited Conduct
	In providing the services described in this agreement, the Sub-Advisor will not consult with any other
	investment advisory firm that provides investment advisory services to any investment company
	sponsored by Principal Life Insurance Company regarding transactions for the Fund in securities or
	other assets.
4.	Compensation
	As full compensation for all services rendered and obligations assumed by the Sub-Advisor
	hereunder with respect to the Fund, the Manager shall pay the compensation specified in
	Appendix A to this Agreement.
5.	Liability of Sub-Advisor
	Neither the Sub-Advisor nor any of its directors, officers, employees, agents or affiliates shall be
	liable to the Manager, the Fund or its shareholders for any loss suffered by the Manager or the Fund
	resulting from any error of judgment made in the good faith exercise of the Sub-Advisor's duties
	under this Agreement or as a result of the failure by the Manager or any of its affiliates to comply
	with the terms of this Agreement except for losses resulting from the Sub-Advisor’s willful
	misfeasance, bad faith or gross negligence of, or from reckless disregard of, the duties of the
	Sub-Advisor under this Agreement.
6.	Indemnification
	The Manager agrees to indemnify and hold harmless the Sub-Advisor from and against any and all
	claims, losses, liabilities or damages (including reasonable attorneys’ fees and other related
	expenses), (“Losses”) howsoever arising, from or in connection with this Agreement or the
	performance by the Sub-Advisor of its duties hereunder, so long as the Sub-Advisor shall, after
	receipt of notice of any claim or commencement of any action, promptly notify the Manager in writing
	of the claim or commencement of such action. The Manager shall not be liable for any settlement of
	any claim or action effected without its written consent. Nothing contained herein shall require the
	Manager to indemnify the Sub-Advisor for Losses resulting from the Sub-Advisor’s willful
	misfeasance, bad faith or gross negligence in the performance of its duties or from its reckless
	disregard of its obligations and duties under this Agreement.
7.	Supplemental Arrangements
	The Sub-Advisor may enter into arrangements with other persons affiliated with the Sub-Advisor or
	with unaffiliated third parties to better enable the Sub-Advisor to fulfill its obligations under this
	Agreement for the provision of certain personnel and facilities to the Sub- Advisor, subject to written
	notification to and approval of the Manager and, where required by applicable law, the Board of
	Directors of the Fund.
8.	Regulation
	The Sub-Advisor shall submit to all regulatory and administrative bodies having jurisdiction over the
	services provided pursuant to this Agreement any information, reports or other material which any
	such body may request or require pursuant to applicable laws and regulations.

9.	Duration and Termination of This Agreement
	This Agreement shall become effective as of the date of its execution and, unless otherwise
	terminated, shall continue in effect for a period of two years and thereafter from year to year
	provided that the continuance is specifically approved at least annually either by the Board of
	Directors of the Fund or by a vote of a majority of the outstanding voting securities of the Series and
	in either event by a vote of a majority of the Board of Directors of the Fund who are not interested
	persons of the Manager, Principal Life Insurance Company, the Sub-Advisor or the Fund cast in
	person at a meeting called for the purpose of voting on such approval.
	If the shareholders of a Series fail to approve the Agreement or any continuance of the Agreement
	in accordance with the requirements of the 1940 Act, the Sub-Advisor will continue to act as Sub-
	Advisor with respect to the Series pending the required approval of the Agreement or its
	continuance or of any contract with the Sub-Advisor or a different manager or Sub-Advisor or other
	definitive action; provided, that the compensation received by the Sub-Advisor in respect to the
	Series during such period is in compliance with Rule 15a-4 under the 1940 Act.
	This Agreement may be terminated at any time without the payment of any penalty by the Board of
	Directors of the Fund or by the Sub-Advisor, the Manager or by vote of a majority of the outstanding
	voting securities of the Series on sixty days written notice. This Agreement shall automatically
	terminate in the event of its assignment. In interpreting the provisions of this Section 9, the
	definitions contained in Section 2(a) of the 1940 Act (particularly the definitions of "interested
	person," "assignment" and "voting security") shall be applied.
10. Amendment of this Agreement
	No material amendment of this Agreement shall be effective until approved, if required by the 1940
	Act or the rules, regulations, interpretations or orders issued thereunder, by vote of the holders of a
	majority of the outstanding voting securities of the Series and by vote of a majority of the Board of
	Directors of the Fund who are not interested persons of the Manager, the Sub-Advisor, Principal Life
	Insurance Company or the Fund cast in person at a meeting called for the purpose of voting on such
	approval, and such amendment is signed by both parties.
11. General Provisions
	(a)	Each party agrees to perform such further acts and execute such further documents as are
		necessary to effectuate the purposes hereof. This Agreement shall be construed and enforced
		in accordance with and governed by the laws of the State of Iowa. The captions in this
		Agreement are included for convenience only and in no way define or delimit any of the
		provisions hereof or otherwise affect their construction or effect.
	(b)	Any notice under this Agreement shall be in writing, addressed and delivered or mailed
		postage pre-paid to the other party at such address as such other party may designate for the
		receipt of such notices. Until further notice to the other party, it is agreed that the address of
		the Manager for this purpose shall be Principal Financial Group, Xxx Xxxxxx, Xxxx
		00000-0000, and the address of the Sub-Advisor shall be Tortoise Capital Advisors, L.L.C.,
		00000 Xxx Xxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxx 00000.
	(c)	The Sub-Advisor will promptly notify the Manager in writing of the occurrence of any of the
		following events:
		(1) the Sub-Advisor fails to be registered as an investment adviser under the Investment
		Advisers Act or under the laws of any jurisdiction in which the Sub-Advisor is required to
		be registered as an investment advisor in order to perform its obligations under this
		Agreement.

(2)	The Sub-Advisor is served or otherwise receives notice of any action, suit, proceeding,
	inquiry or investigation, at law or in equity, before or by any court, public board or body,
	involving the affairs of the Fund.
(d)	The Manager shall provide (or cause the Series custodian to provide) timely information to the
	Sub-Advisor regarding such matters as the composition of the assets of the Series, cash
	requirements and cash available for investment in the Series, and all other reasonable
	information as may be necessary for the Sub-Advisor to perform its duties and responsibilities
	hereunder.
(e)	The Sub-Advisor represents that it will not enter into any agreement, oral or written, or other
	understanding under which the Fund directs or is expected to direct portfolio securities
	transactions, or any remuneration, to a broker or dealer in consideration for the promotion or
	sale of Fund shares or shares issued by any other registered investment company. Sub-
	advisor further represents that it is contrary to the Sub-advisor’s policies to permit those who
	select brokers or dealers for execution of fund portfolio securities transactions to take into
	account the broker or dealer’s promotion or sale of Fund shares or shares issued by any other
	registered investment company.
(f)	The Sub-Advisor agrees that neither it nor any of its affiliates will in any way refer directly or
	indirectly to its relationship with the Fund, the Series, or the Manager or any of their respective
	affiliates in offering, marketing or other promotional materials without the express written
	consent of the Manager.
(g)	This Agreement contains the entire understanding and agreement of the parties.
IN WITNESS WHEREOF, the parties have duly executed this Agreement on the date first above
written.
	PRINCIPAL MANAGEMENT CORPORATION
	By   /s/ Xxxxxxx X. Beer
	Xxxxxxx X. Beer, Executive Vice President and
	Chief Operating Officer
	TORTOISE CAPITAL ADVISORS, L.L.C.
	By   /s/ Xxxxxxx X. Xxxxxx
	Xxxxxxx X. Xxxxxx
	Management Director

APPENDIX A
Tortoise Capital Advisors, L.L.C. (“Tortoise”) shall serve as an investment sub-advisor for the Series
identified below. The Manager will pay Tortoise, as full compensation for all services provided under this
Agreement, a fee, computed daily and paid monthly, at an annual rate as shown below of the Series’ net
assets as of the first day of each month allocated to Tortoise’s management.
In calculating the fee for a series included in the table, assets of any unregistered separate account of
Principal Life Insurance Company and any investment company sponsored by Principal Life Insurance
Company to which Tortoise provides investment advisory services and which have the same investment
mandate as the series for which the fee is calculated, will be combined with the assets of the series to
arrive at net assets.
If this Agreement becomes effective or terminates before the end of any month, the fee (if any) for the
period from the effective date to the end of such month or from the beginning of such month to the date
of termination, as the case may be, shall be prorated according to the proportion which such period
bears to the full month in which such effectiveness or termination occurs.
Global Diversified Income Fund
Sub-Advisor’s Fee as a Percentage of Average Daily Net Assets
First $25 million	1.00%
Next $25 million	0.85%
Next $25 million	0.75%
Assets of $75 million or more*	0.75%
*    During any period when the Fund’s Average Daily Net Assets equal or exceed
$75 million, Tortoise’s fee as a percentage of average daily net assets shall
be 0.75% on all assets.
Diversified Real Asset Fund
Sub-Advisor’s Fee as a Percentage of Average Daily Net Assets
First $25 million	1.00%
Next $25 million	0.85%
Next $25 million	0.75%
Assets of $75 million or more*	0.75%
*    During any period when the Fund’s Average Daily Net Assets equal or exceed
$75 million, Tortoise’s fee as a percentage of average daily net assets shall
be 0.75% on all assets.