Farmers Insurance Group
210 W. Birch St. #205 Brea, CA92821714-257-2517 Fax 714-257-2522
October 25, 2007
Securities and Exchange Commission
Attn: Filing Desk
100 F Street, N.E.
Washington, D.C. 20549
Re: Principal Mortgage Fund, Inc.
Ladies and Gentlemen:
Enclosed for filing on behalf of Principal Mortgage Fund, Inc. (the
"Company") pursuant to Rule 17g-l(g) under the Investment Company Act of 1940
please find a copy of (i) the Company's single insured bond for the period from
October 25, 2007 to October 25, 2008, (ii) the resolution of a majority of the
board of directors of the Company who are not "interested persons" approving the
amount, type, form and coverage of the single insured bond, and (iii) a
statement as to the period for which premiums have been paid.
Please call me at (714) 257-2517 if you have any questions.
/s/ Jonathan Ekno
Stateside Underwriting Agency
29 South La Salle, Suite 530
Chicago, IL60603312-345-1800 Tel
DATE: October 26, 2007NAME OF ASSURED: PRINCIPAL MORTGAGE FUND, INC. ADDRESS OF ASSURED: 1805 NO. CARSON ST. #108 CARSON CITY, NV89701SECURITY: UNDERWRITERS AT LLOYD'S, LONDON AND LONDON COMPANIESCOVERAGE: SPECIAL MORTGAGE BANKERS BOND THIS IS TO CONFIRM COVERAGE IS BOUND EFFECTIVE OCTOBER 25, 2007 TO OCTOBER 25,2008 (Note, this binder, however, is only in effect for 30 days from the date of
POLICY NUMBER ASSIGNED: SUA 2975 CLAUSE DESCRIPTION SUB-LIMIT DEDUCTIBLE
1 Dishonesty $1,000,000 $25,000
2 Premises $1,000,000 $25,000
3 Transits $1,000,000 $25,000
4 Forged Checks $1,000,000 $25,000
5 Forged Documents $1,000,000 $25,000
6 Secondary Market Inst. NA NA
7 Claims Expense NA NA
8 Legal Expense NA NA
9 Errors & Omissions NA NA
10 Replacement Expense NA NA
11 Extended E&O NA NA
12 Elec. & Computer Crime $1,000,000 $25,000
SUBJECT TO: NONE OTHER CONDITIONS: RETRO DATE: NONE SERVICE OF SUIT CLAUSE (N.M.A. 1998) LOSS PAYEE RIDER AS REQUIRED (SR 6186) DISCOVERY LIMITATION CLAUSE 1 (DLC) SERVERAL LIABILITY NOTICE (LSW 1001) WAR & TERRORISM EXCLUSION ENDORSEMENT (N.M.A. 2918) US TERRORISM RISK INSURANCE - NOT PURCHASED CLAUSE DMA5053 CHOICE OF LAW CLAUSE NUCLEAR INCIDENT EXCLUSION CLAIMS NOTIFICATION ENDORSEMENT
PREMIUM DUE DATE: November 20, 2007ANNUAL PREMIUM: $5,000.00 TRIA PREMIUM: $0.00 POLICY FEE: $125.00 GROSS PREMIUM: $5,125.00 SURPLUS LINES TAX 3.5%: $179.38 STAMPING FEE 0.40%: $20.50 TOTAL PREMIUM: $5,324.88 NOTE THAT THE TERRORISM EXCLUSION CAN BE DELETED FOR AN ADDITIONAL PREMIUM AS SET OUT IN THE PROPOSAL. IN EITHER CASE, THIS BINDER IS SUBJECT TO RECEIPT OF A TRIA FORM. THE CLIENT MUST ELECT ON A TRIA FORM WHETHER THEY DESIRE TO PURCHASE THIS COVERAGE OR NOT. IF THIS FOR HAS NOT BEEN SUBMITTED PRIOR TO BINDING, WE NEED TO RECEIVE THIS WITHIN 10 DAYS OF THE BINDER DATE. THIS BINDER IS VALID FOR 30 DAYS ONLY
This binder is a temporary insurance contract subject to the terms, conditions
and limitations of the policy(ies) in current use by the Underwriters.
This binder may be cancelled by the Insured by surrender of this binder or by
written notice to the Underwriters stating when cancellation will be effective.
This binder is cancelled when replaced by the policy. If this binder is not
replaced by the policy, the Underwriters are entitled to charge a premium for
/s/ Authorized Representative October 26, 2007
By Stateside Underwriting Agency, Inc.
PRINCIPAL MORTGAGE FUND RESOLUTION"FIDELITY BOND"
RESOLVED: That, after considering all relevant factors, the action of
the Authorized Officers of the Company in obtaining a bond
issued by Federal Insurance Company, covering larceny and
embezzlement and certain other acts, with a limit of liability
of $1,000,000, for an aggregate one-year premium of $5,324.88,
be, and it hereby is, authorized and approved.
RESOLVED: That pursuant to Rule 17g-l under the 1940 Act, as amended,
Joe Villa, Chief Executive Officer, and Harold Gregg, General
Counsel, Chief Compliance Officer and Secretary, are each
hereby designated as an agent for the Company to make the
filings and give the notices required by subparagraph (g) of
RESOLVED: That the form and amount of the bond issued by Federal
Insurance Company, after consideration of all relevant factors
including the Company's aggregate assets to which persons
covered by the bond have access, the type and terms of
arrangements made for custody and safekeeping of assets, and
the nature of the securities held, be and they hereby are
authorized and approved.