exv10w1






MTN GLOBAL FUNDING AGREEMENT




Principal Life Insurance Company

711 High Street

Des Moines, Iowa 50392-0001

(515) 247-5111



In consideration of the payment made by, or at the direction of,




Principal Life Income Fundings Trust 2008-48




(the “Agreement Holder”)



of the Net Deposit, as described below, Principal Life Insurance Company (“Principal Life”) agrees
to make payments to the person or persons entitled to them, subject to the provisions of this
funding agreement (this “Agreement”).



This Agreement is delivered in and subject to the laws of the State of Iowa.



This Agreement is issued and accepted subject to all the terms set out in it.



This Agreement is executed by Principal Life at its Corporate Center to take effect as of the 18th
day of June, 2008, which is referred to as the Effective Date, subject to the receipt by Principal
Life or its designee of the Net Deposit (as set forth in Section 1).




	 	 	 
	
	 	






	 	 	 	 	 
	 	 	 
	 	 	/s/ Bret Taber
 	 
	 	 	Registrar 	 
	 	 	 
	 	 	June 2, 2008

Date
 





FUNDING AGREEMENT NO. 8-4800




RESTRICTIONS REGARDING THE TRANSFER OR SALE OF

THIS FUNDING AGREEMENT OR ANY INTEREST HEREIN ARE SET FORTH

HEREIN




GPA 5999




 









 





	 	 	 
	FUNDING AGREEMENT

	 	No. 8-4800






     This Agreement is issued in connection with the issuance by the Trust (specified in the Annex)
of secured medium-term notes (the “Notes”) which comprise a Series of Notes which are identified in
the annex hereto (the “Annex”) and which are being issued by the Trust pursuant to the Prospectus
dated November 21, 2007, the Prospectus Supplement dated November 21, 2007, as from time to time
amended or supplemented, and the Pricing Supplement applicable to such Notes (the “Pricing
Supplement”). Capitalized terms not otherwise defined herein shall have the meanings ascribed to
them in the Notes. Where used in this Agreement, the term “Notes” and “Series of Notes” shall mean
the Notes and the Series of Notes secured by this Agreement as the same exist on the Effective
Date, without giving effect to any amendments or modifications to said Notes or Series of Notes
effected or made after any such Effective Date unless such amendments or modifications to said
Notes or Series of Notes have been consented to in writing by Principal Life.




	1.	 	Deposit
	 
	 	 	Principal Life agrees to accept, and the Agreement Holder agrees to pay or cause to be paid
to Principal Life, for value on the Effective Date, the Net Deposit (as specified in the
Annex). All funds received by Principal Life under this Agreement shall become the exclusive
property of Principal Life and remain a part of Principal Life’s general account without any
duty or requirement of segregation or separate investment.
	 
	 	 	This Agreement shall become effective only upon the receipt by Principal Life or its
designee of the Net Deposit.
	 
	2.	 	Fund
	 
	 	 	Upon receipt of the Net Deposit, Principal Life will establish, under this Agreement, a
bookkeeping account in the name of the Agreement Holder, which will evidence Principal
Life’s obligations under this Agreement.
	 
	 	 	The Deposit deemed received (as specified in the Annex), (i) less any withdrawals to make
payments hereunder (other than Additional Amounts (as defined in the Annex), if applicable)
and (ii) plus any interest accrued and premium, if any, pursuant to Section 7, will be
referred to as the “Fund”.
	 
	 	 	Principal Life is neither a trustee nor a fiduciary with respect to the Fund.
	 
	3.	 	Purchase of Notes By Principal Life
	 
	 	 	Principal Life may purchase some or all of the Notes in the open market or otherwise at any
time, and from time to time. Simultaneously, upon such purchase, (1) the purchased Notes
shall, by their terms become mandatorily redeemable by the Trust as specified in the related
Pricing Supplement, Prospectus Supplement and/or Prospectus and (2) the Fund under this
Agreement shall be permanently reduced by the same percentage as the principal amount of the
Notes so redeemed bears to the sum of (i) the aggregate principal amount of all Notes issued
and outstanding immediately prior to such redemption and




 









 






	 	 	the principal amount of the Trust Beneficial Interest related to such series of Notes. If
Principal Life, in its sole discretion, engages in such open market or other purchases, then
the Trust, the Indenture Trustee in respect of such Notes, and Principal Life shall take
such actions (including, in the case of Principal Life, making the payment(s) necessary to
effect the Trust’s redemption of such Notes) as may be necessary or desirable to effect the
cancellation of such Notes by the Trust.
	 
	4.	 	Entire Agreement
	 
	 	 	This Agreement and the Annex attached hereto constitute the entire Agreement.
	 
	5.	 	Representations






	 	(a)	 	Each party hereto represents and warrants to the other that as of the date
hereof:






	 	(i)	 	it has the power to enter into this Agreement and to consummate
the transactions contemplated hereby;
	 
	 	(ii)	 	this Agreement has been duly authorized, executed and
delivered, this Agreement constitutes a legal, valid and binding obligation of
each party hereto, and this Agreement is enforceable in accordance with the
terms hereof, subject to applicable bankruptcy, insolvency and similar laws
affecting creditors’ rights, and subject as to enforceability to general
principles of equity, regardless of whether enforcement is sought in a
proceeding in equity or at law; and
	 
	 	(iii)	 	the execution and delivery of this Agreement and the
performance of obligations hereunder do not and will not constitute or result
in a default, breach or violation of the terms or provisions of its
certificate, articles or charter of incorporation, declaration of trust,
by-laws or any agreement, instrument, mortgage, judgment, injunction or order
applicable to it or any of its property.






	 	(b)	 	The Trust further represents and warrants to Principal Life that:






	 	(i)	 	it is a person other than a natural person and is purchasing
this Agreement for the purpose of providing collateral security for securities
registered with the United States Securities and Exchange Commission;
	 
	 	(ii)	 	it has been informed and understands that transfer is
restricted by the terms of this Agreement; and
	 
	 	(iii)	 	it (a) is solely responsible for determining whether this
Agreement is suitable for the purpose intended; (b) has carefully read this
Agreement (including the Annex) before signing this Agreement; (c) has had a
reasonable opportunity to make such inquiries as it deemed necessary prior to
signing this Agreement; and (d) has received or had access to such





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	 	 	 	additional information as it deemed necessary in connection with its
decision to sign this Agreement.






	 	 	In performing its obligations hereunder Principal Life is not acting as a fiduciary, agent
or other representative for the Agreement Holder or anyone else. All representations and
warranties made by the Agreement Holder and Principal Life in this Agreement shall be
considered to have been relied upon by the other in connection with the execution hereof.
	 
	6.	 	Assignment of Agreement
	 
	 	 	The following conditions must be satisfied in order to effectuate any assignment of this
Agreement:






	 	(i)	 	This Agreement may only be transferred through a book entry system maintained
by Principal Life, or an agent designated by it, within the meaning of Temporary
Treasury Regulations Section 5f.103-1(c) and Treasury Regulations Section
1.871-14(c)(1)(i).
	 
	 	(ii)	 	The Agreement Holder, and any assignee, must comply with applicable securities
laws.
	 
	 	(iii)	 	Principal Life has consented in writing to the proposed assignment, such
consent not to be unreasonably withheld.
	 
	 	(iv)	 	Principal Life shall have received from the proposed assignee a duly executed
certificate containing, in substance, the information, representations, warranties,
acknowledgments and agreements set forth in this Agreement.






	 	 	Any attempted sale, transfer, anticipation, assignment, hypothecation, or alienation not in
accordance with this Section 6 shall be void and of no effect. Until such time, if any, as
Principal Life has consented in writing to a proposed assignment, Principal Life shall not
be obligated to make any payments to or at the direction of anyone other than the person
shown on Principal Life’s books and records as the Agreement Holder. Once the foregoing
conditions have been satisfied with respect to an assignment, the assignee or its successor
shall be deemed to be the sole Agreement Holder for all purposes of this Agreement and
Principal Life shall promptly amend its records to reflect the assignee’s status as
Agreement Holder.
	 
	7.	 	Payments to the Agreement Holder
	 
	 	 	Principal Life shall pay to, or at the direction of, the Agreement Holder by the date (the
“Due Date”) on which any payment becomes due in respect of the Notes secured by this
Agreement (and in any event such period of time prior to the Due Date as shall be necessary
to ensure that the Trust can fulfill its obligation to make payment in full of all amounts
due and payable under such Notes on the Due Date), an amount in the currency or currencies
in which the Notes are denominated as specified in the Notes equal to the sum of (i) the
amount of principal and/or (as the case may be) interest and/or (as the case may be) premium
falling due in respect of such Notes on such Due Date (the “Notes





4









 






	 	 	Component”) and (ii) the amount of any payments owed by the Trust in respect of the Trust
Beneficial Interest (issued in connection with the Series of Notes secured by this
Agreement) falling due on such date (the “Beneficial Component”). In the event that
Principal Life fails to make payment of any such amount on or prior to the Due Date,
Principal Life shall pay to or at the direction of the Agreement Holder, on demand by the
Agreement Holder, (i) if the failure relates to the Notes Component, an amount in the
currency specified in the Notes equal to the amount of default interest (or other amount)
which becomes due and payable by the Trust in accordance with the Notes as a consequence of
any delay in the Trust making the relevant payment of principal, interest or premium (as the
case may be) to the holders of such Notes and (ii) if the failure relates to the Beneficial
Component, such amount of default interest, if any, determined in the same manner as default
interest on the Notes Component.
	 
	 	 	Interest shall accrue on the Fund in the same amount and pursuant to the same terms as
interest accrues on the Notes secured by this Agreement and on the Trust Beneficial Interest
related to the Notes.
	 
	 	 	If any amount is withdrawn from the Fund in order to make a payment under this Section 7,
interest will cease to be credited with regard to such amount as of the end of the day
immediately preceding the date on which such withdrawal is made.
	 
	 	 	All payments made by Principal Life to the Agreement Holder hereunder shall be paid in
same-day, freely transferable funds to such account as has been specified for such purpose
by the Agreement Holder.
	 
	 	 	Notwithstanding anything to the contrary in this Section 7, if Principal Life shall, with
respect to any scheduled amount due and payable under any of the Notes, comply in all
respects with the requirements of this Section 7, but an event of default has occurred with
respect to the Notes and as a result payments with respect to the Notes have been
accelerated, otherwise than by reason of any default under this Agreement by Principal Life,
no Event of Default (as defined below) under this Funding Agreement shall be deemed to have
occurred, no payments with respect to this Agreement shall be accelerated and Principal Life
will remain obligated to make payments under this Agreement as if no event of default had
occurred with respect to the Notes.
	 
	8.	 	Termination of Agreement
	 
	 	 	Subject to the provisions of the following paragraph and the Annex, this Agreement shall
terminate and cease to be of any further force or effect on the day and at the time upon
which all amounts have been withdrawn from the Fund pursuant to this Agreement.
	 
	 	 	Upon the occurrence of any of the following events (each, an “Event of Default”) and
following a written demand by the Agreement Holder, Principal Life shall pay to, or at the
direction of, the Agreement Holder all amounts that the Trust is required to pay in such
event under the Notes and the Trust Beneficial Interest:






	 	(i)	 	Principal Life’s failure to make any payment of interest, premium (if
applicable), installment payments (if applicable) or Additional Amounts (if and as
specified in





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	 	 	 	the Annex) in accordance with this Agreement, if such failure to pay is not
corrected within seven (7) Business Days after such payment becomes due and payable;
or
	 
	 	(ii)	 	Principal Life’s failure to make any payment of principal (other than any
installment payment) in accordance with this Agreement, if such failure to pay is not
corrected within one (1) Business Day after such payment becomes due and payable; or
	 
	 	(iii)	 	if Principal Life (a) is dissolved (other than pursuant to a consolidation,
amalgamation or merger in which the resulting entity assumes its obligations); (b)
becomes insolvent or is unable to pay its debts or fails or admits in writing its
inability generally to pay its debts as they become due; (c) makes a general
assignment, arrangement or composition with or for the benefit of its creditors; (d)
institutes or has instituted against it an administrative or legal proceeding seeking a
judgment of insolvency or bankruptcy or any other relief under any supervision,
rehabilitation, liquidation, bankruptcy or insolvency law or other similar law
affecting creditors’ rights, or a petition is presented for its winding-up or
liquidation, and, in the case of any such proceeding or petition instituted or
presented against it, such proceeding or petition (1) results in a judgment of
insolvency or bankruptcy or the entry of an order for relief or the making of an order
for its rehabilitation, winding-up or liquidation or (2) is not dismissed, discharged,
stayed or restrained in each case within 60 days of the institution or presentation
thereof; (e) has a resolution passed for its rehabilitation, winding-up, official
management or liquidation (other than pursuant to a consolidation, amalgamation or
merger in which the resulting entity assumes the obligations of Principal Life); (f)
seeks or becomes subject to the appointment of an administrator, supervisor,
rehabilitator, provisional liquidator, conservator, receiver, trustee, custodian or
other similar official for it or for all or substantially all its assets; (g) has a
secured party take possession of all or substantially all its assets or has a distress,
execution, attachment, sequestration or other legal process levied, enforced or sued on
or against all or substantially all its assets and such secured party maintains
possession, or any such process is not dismissed, discharged, stayed or restrained, in
each case within 60 days thereafter; (h) causes or is subject to any event with respect
to it which, under the applicable laws of any jurisdiction, has an analogous effect to
any of the events specified in clauses (a) to (g) (inclusive); or (i) takes any action
in furtherance of, or indicating its consent to, approval of, or acquiescence in, any
of the foregoing acts.






	 	 	Notwithstanding anything to the contrary in this Section 8, if an event described in clause
(iii) above occurs, this Agreement will automatically terminate and the amount of the Fund
will be immediately due and payable by Principal Life to the Agreement Holder, or the
account specified by the Agreement Holder.
	 
	 	 	Principal Life will promptly notify the Agreement Holder and the Rating Agencies in writing
of the occurrence of any of (i) through (iii) above.





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	9.	 	Withholding; Additional Amounts
	 
	 	 	All amounts due in respect of this Agreement will be made without withholding or deduction
for or on account of any present or future taxes, duties, levies, assessments or other
governmental charges of whatever nature imposed or levied by or on behalf of any
governmental authority in the United States unless the withholding or deduction is required
by law. Unless otherwise specified in the Annex, Principal Life will not pay any additional
amounts to the Agreement Holder in the event that any withholding or deduction is so
required by law, regulation or official interpretation thereof, and the imposition of a
requirement to make any such withholding or deduction will not give rise to an Event of
Default or any independent right or obligation to redeem this Agreement.
	 
	10.	 	Currency
	 
	 	 	Except as may be specifically noted in the Annex, the Net Deposit and all payments under
Section 7 of this Agreement shall be made using the currency or currencies as specified in
the Notes.
	 
	11.	 	Tax Treatment
	 
	 	 	Principal Life and the Agreement Holder agree that this Agreement shall be disregarded for
U.S. Federal income tax purposes. Principal Life and the Agreement Holder further agree
that if this Agreement is not so disregarded, it will and is intended to be treated as a
debt obligation of Principal Life issued in registered form within the meaning of Treasury
Regulations Section 1.871-14(c)(1)(i), except to the extent provided in Treasury Regulations
Section 1.163-5T (or any subsequent similar regulation).
	 
	12.	 	Amendment and Modification
	 
	 	 	This Agreement may be amended or modified in whole or in part, at any time and from time to
time, for any period or periods (a) by mutual written agreement by such officers of
Principal Life, the Agreement Holder and, where such Agreement Holder is the Indenture
Trustee upon an assignment by way of security of this Agreement by the Trust, the Trust and
(b) without the consent of any other person affected thereby.
	 
	13.	 	Notice
	 
	 	 	Except as otherwise provided herein, all notices given pursuant to this Agreement shall be
in writing, and shall either be delivered, mailed or telecopied to the locations listed
below or at such other address or to the attention of such other persons as such party shall
have designated for such purpose in a written notice complying as to delivery with the terms
of this Section 13. Each such notice shall be effective (i) if given by telecopy, when
transmitted to the applicable number so specified in this Section 13 (if required herein,
such notice shall also be sent by mail, with first class postage prepaid), (ii) if given by
mail, three days after deposit in the mails with first class postage prepaid, or (iii) if
given by any other means, when actually delivered at such address.





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	 	 	If to Principal Life:




Principal Life Insurance Company

711 High Street

Des Moines, Iowa 50392-0001

Attention:   General Counsel

Telephone:  (515) 247-5111

Telecopy:     (515) 248-3011



Principal Life Insurance Company

711 High Street

Des Moines, Iowa 50392-0001

Attention:   Jim Fifield, Counsel

Telephone:  (515) 248-9196

Telecopy:     (866) 496-6527





	 	 	If to the Agreement Holder:




Principal Life Income Fundings Trust 2008-48

c/o U.S. Bank Trust National Association

100 Wall Street, 16th Floor

New York, NY 10005

Attention: Janet P. O’Hara

Telephone: (212) 361-2527

Facsimile: (212) 809-5459




	 	 	with a copy to:




Citibank, N.A.

Corporate and Investment Banking

388 Greenwich Street, 14th Floor

New York, NY 10013



Attention: Jennifer H. McCourt

Telephone: (212) 816-5680

Telecopy: (212) 816-5527





	14.	 	Business Day
	 
	 	 	For purposes of this Agreement, “Business Day” means any day that is a Business Day as
specified in the Notes or the Indenture.
	 
	15.	 	Business Day Convention
	 
	 	 	If the date on which any payment is due to be made under this Agreement shall occur on a day
on which is not a Business Day, such payment shall be made in accordance with the Business
Day Convention as specified in the Notes.




 









 






	15.	 	Business Day Convention
	 
	 	 	If the date on which any payment is due to be made under this Agreement shall occur on a day
on which is not a Business Day, such payment shall be made in accordance with the Business
Day Convention as specified in the Notes.
	 
	16.	 	Jurisdiction
	 
	 	 	The parties to this Agreement hereby consent to the non-exclusive jurisdiction of any State
or Federal Court of competent jurisdiction located within the State of New York, in the
Borough of Manhattan, in connection with any actions or proceedings arising directly or
indirectly from this Agreement.
	 
	17.	 	Waiver
	 
	 	 	The obligations of Principal Life or the Agreement Holder under this Agreement may be waived
only in writing by the party to this Agreement whose interests are adversely affected by
such waiver. No failure or delay, on the part of the party adversely affected, in
exercising any right or remedy hereunder shall operate as a waiver thereof.
	 
	18.	 	Tax Redemption.
	 
	 	 	If a Tax Event (defined below) occurs, Principal Life will have the right to redeem this
Agreement by giving not less than 30 and no more than 60 days prior written notice to the
Agreement Holder and by paying to the Agreement Holder an amount equal to the Fund. The
term “Tax Event” means that Principal Life shall have received an opinion of independent
legal counsel stating in effect that as a result of (a) any amendment to, or change
(including any announced prospective change) in, the laws (or any regulations thereunder) of
the United States or any political subdivision or taxing authority thereof or therein or (b)
any amendment to, or change in, an interpretation or application of any such laws or
regulations by any governmental authority in the United States, which amendment or change is
enacted, promulgated, issued or announced on or after the Effective Date of this Agreement,
there is more than an insubstantial risk that (i) the Trust is, or will be within 90 days of
the date thereof, subject to U.S. federal income tax with respect to interest accrued or
received on this Agreement or (ii) the Trust is, or will be within 90 days of the date
thereof, subject to more than a de minimis amount of taxes, duties or other governmental
charges.






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ANNEX



This Annex will become effective as of the Effective Date, subject to the requirements of Section
1.




	 	 	 
	Trust:

	 	Principal Life Income Fundings Trust 2008-48
	 
	 	 
	Net Deposit:

	 	The Net Deposit is $4,034,625.
	 
	 	 
	Deposit:

	 	Regardless of the amount of the Net Deposit, the
Deposit is deemed to be $4,060,015.
	 
	 	 
	Bank and Account:

	 	Wells Fargo Bank Iowa, N.A.
	 

	 	ABA No.: XXXXXXXXX
	 

	 	For credit to Principal Life Insurance Company
	 

	 	Account #XXXXXXXXXX
	 
	 	 
	Series of Notes:

	 	Principal Life Income Fundings Trust 2008-48 4.75%
Principal® Life CoreNotes® Due
2011
	 
	 	 
	Survivor’s Option:

	 	Unless this Agreement has been declared due and payable
prior to the Maturity Date of the related Notes by
reason of any Event of Default, or has been previously
redeemed or otherwise repaid, the Agreement Holder may
request repayment of this Agreement upon the valid
exercise of the Survivor’s Option in the Notes by the
Representative (defined in the Notes) of the deceased
Beneficial Owner of such Notes (a “Survivor’s Option”).
	 
	 	 
	 

	 	Except as provided below, upon the tender to and
acceptance by Principal Life of this Agreement (or
portion thereof) securing the Notes as to which the
Survivor’s Option has been exercised, Principal Life
shall repay to the Agreement Holder the amount of the
Fund equal to (i) 100% of the principal amount of the
Notes as to which the Survivor’s Option has been
validly exercised and accepted, plus accrued and unpaid
interest on such amount to the date of repayment, or
(ii) in the case of Discount Notes, the Issue Price of
the Notes as to which the Survivor’s Option has been
validly exercised and accepted, plus accrued discount
and any accrued and unpaid interest on such amount to
the date of repayment. However, Principal Life shall
not be obligated to repay in any calendar year:
	 
	 	 
	 

	 	
•    more than the greater of $2,000,000 or 2% of
the aggregate deposit for all funding agreement
contracts securing all outstanding notes issued under
the Principal® Life CoreNotes®
Program and Secured Medium-Term Notes Retail Program as
of the end of the most recent calendar year;







 









 






	 	 	 	Program and Secured Medium-Term Notes Retail Program as
of the end of the most recent calendar year;
	 
	 	•	 	more than $250,000 in aggregate deposit of
funding agreement contracts securing outstanding notes
issued under the Principal® Life
CoreNotes® Program and Secured Medium-Term
Notes Retail Program as to which the Survivor’s Option
has been exercised on behalf of any single beneficial
owner in any calendar year; or
	 
	 	•	 	more than 2% of the Deposit under this
Agreement which secures the related Notes, as of the
later of the end of the most recent calendar year or
the issuance date of such Series of Notes.






	 	 	 	Principal Life shall not make repayments pursuant to
the Agreement Holder’s request for repayment upon
exercise of the Survivor’s Option in amounts that are
less than $1,000, and, in the event that the
limitations described in the preceding sentence would
result in the partial repayment of this Agreement, the
principal amount of this Agreement remaining
outstanding after repayment must be at least $1,000
(the minimum authorized denomination of this
Agreement). A request for repayment by the Agreement
Holder upon an otherwise valid election to exercise the
Survivor’s Option may not be withdrawn.
	 
	 	 	 	This Agreement (or portion thereof) accepted for
repayment shall be repaid on the first Interest Payment
Date for the related Series of Notes that occurs 20 or
more calendar days after the date of such acceptance.
	 
	 	 	 	In order to obtain repayment of this Agreement (or
portion thereof) upon exercise of the Survivor’s
Option, the Agreement Holder must provide to Principal
Life (i) a written request for repayment signed by the
Agreement Holder, and (ii) any additional information
Principal Life requires to evidence satisfaction of any
conditions to the repayment of this Agreement (or
portion thereof).






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	PRINCIPAL LIFE INSURANCE COMPANY

 	 	 
	By:	 	/s/ Michael Garvin	 	 
	  	 	Name: Michael Garvin 	 
	  	 	Title:   Associate Actuary 	 
	 



PRINCIPAL LIFE INCOME FUNDINGS TRUST 2008-48





	 	 	 	 	 
	By: 	U.S. Bank Trust National Association,
not in its individual capacity, but solely in its capacity as trustee
 	 	 
	 	 	 
	By:  	Bankers Trust Company, N.A.,
under Limited Power of Attorney, dated November 21, 2007.
 	 	 
	 	 	 	 
	 	 	 	 
	By:  	/s/ Diana L. Cook
 	 	 
	 	Name: Diana L. Cook 	 	 
	 	Title:   Vice President