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Document

May 29, 2024

Via EDGAR

Raymond Be

Tony Burak

Division of Investment Management

Securities and Exchange Commission

100 F Street, NE

Washington D.C. 20549

Re:    Principal Private Credit Fund I (the “Registrant”)

File Numbers 333-278716, 811-23954

Initial Filing of the Registration Statement on Form N-2

Dear Messrs. Be and Burak:

This letter responds, on behalf of the Registrant, to comments of the Staff of the Securities and Exchange Commission (the “SEC”) with respect to the initial Registration Statement on Form N-2, which was filed on April 16, 2024.  On May 9, 2024, Mr. Burak provided to me Comments 1 through 4 by telephone.  On May 17, 2024, Mr. Be provided to me, by telephone, Comments 5 through 6 and, on May 22, 2024, Comment 7.  The Registrant will make changes in response to SEC Staff comments as described below in a pre-effective amendment to be filed contemporaneously with this response letter.

Comment 1:    Please explain supplementally why the “Other Expenses” in the Summary of Fund Expenses for the Class A and Institutional Class shares are much higher than those of the Class Y shares.

Response:  The estimated “Other Expenses” for Class A and Institutional Class shares were calculated based on the low assets under management (AUM) expected for those share classes in the first year.  Given the expected low AUM for these share classes, there is a greater impact on “other expenses” from fixed expenses that are not asset driven, such as registration fees.

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Comment 2:    In the expense example, the 3-, 5-, and 10-year figures for the Class A and Institutional Class shares seem unreasonable in relation to the Class Y share expenses.  Please revise.

Response:    We agree that the figures in question seem unreasonable, even though we did follow the calculation instructions.  We believe that the resulting figures are a function of the high expense ratios for time periods in which a contractual expense cap is not in effect.  To help remedy this unreasonableness, we have revised the disclosures to reflect what a hypothetical investor’s expenses would be.  The 3-year expense figures for Class A and Institutional Class have been revised to $1,000 and the 5- and 10-year expense figures have been revised to “N/A”.

Registrant has also revised the footnote for these figures to state the following:

Because of the estimated high expense ratios for the Class A and Institutional Class shares for periods in which a contractual fee waiver and/or fee reimbursement is not in effect, the value of your $1,000 investment in those share classes is expected to be zero for the 3-, 5-, and 10-year time periods.  The estimated expense ratios for Class A and Institutional Class shares were calculated based on the low assets under management (AUM) expected for those share classes in the first fiscal year.  During that fiscal year, PGI anticipates limited marketing and sales of Class A and Institutional Class shares compared to Class Y shares.  Given the expected low AUM for Class A and Institutional Class shares, there is a greater impact on their “other expenses” from fixed expenses, such as registration fees.

Comment 3:    On page 47 of the prospectus (with respect to Example #2, Scenario 3), please re-calculate the “Net Investment Income” figure.

Response:  Registrant has revised this figure to 2.382%.

Comment 4:    The Schedule of Investments, which begin on page 24 of the Statement of Additional Information, must conform to Section 12-12 of Regulation S-X.  In that light, please address the following comments in the Schedule of Investments (the “SOI”).

Comment 4a:    For each investment, please disclose the total interest rate in the interest rate column as opposed to, for example, 3M TERM + 5.50%.  In the alternative, please provide the end of period interest term rate in a footnote.

Response:    Registrant has revised the disclosures in the interest rate column to disclose the total interest rate of each investment.

Comment 4b:    In the interest rate column, each investment uses the term “TERM”.  Please clarify what “TERM” means in a footnote.

Response:    Registrant has added a footnote to the SOI disclosing the meaning of “TERM”.

Comment 4c:    Please identify in the SOI which investments are Level 3 investments.

Response:    Each investment listed in the SOI is a Level 3 investment, and Registrant has added a footnote to the SOI indicating so.

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Comment 4d:    To the extent that an investment is restricted, please indicate in a footnote the investment’s acquisition date.

Response:    Registrant confirms that none of the investments listed in the SOI are restricted.

Comment 4e:  To the extent that an investment includes a contractual payment-in-kind (PIK) interest arrangement, please disclose the PIK rate in the interest rate column (e.g., in a parenthetical).

Response:    Registrant confirms that none of the investments listed in the SOI include a PIK interest arrangement.

Comment 5:    Please explain why a new trust/registration statement was created/filed for the launch of this registered fund.  The SEC Staff notes that a different registrant (Principal Private Credit Fund) already exists (333-274212; 811-23897) (the “Other Fund”).  Please explain what your intentions are with respect to the Other Fund.

Response:    Our initial plan was to launch the Other Fund and rely on the Guidestone no-action letter to transfer private loans from an affiliated 3(c)(1)/(7) entity to the Other Fund once the Other Fund’s registration statement on Form N-2 was declared effective.  We were told, however, through an outside law firm that had spoken with the SEC Staff, that the SEC Staff’s position was that the Other Fund could not rely on the Guidestone no-action letter to receive those loans from the affiliated entity.  As such, we pivoted to a Plan B at the suggestion of the outside law firm that had spoken with the SEC Staff.

Plan B entailed the creation of a limited liability company (an “LLC”) that would hold the private loans.  That LLC would then convert itself to a Delaware statutory trust that would then register itself as an investment company with the SEC through the filing of a registration statement on Form N-2 with the SEC.  The Registrant is that Plan B Delaware statutory trust.  The LLC could not convert itself into the existing Other Fund.  In other words, we had to create this new Registrant to achieve our Plan B objective as our original plan – the Other Fund and the Guidestone no-action letter -- was not possible.

Once this Registrant’s registration statement on Form N-2 is declared effective, we intend to withdraw the Other Fund’s registration statement and de-register the Other Fund.  We have not yet withdrawn the Other Fund’s registration statement and de-registered the Other Fund because we may have to pivot back to that Other Fund in case the SEC does not declare the Registrant’s registration statement on Form N-2 effective.  We hope, however, that our Plan B is successful and that we do not have to re-pivot to our original plan – launch of the Other Fund without transferring the private loans to the Other Fund through the Guidestone no-action letter.

Comment 6:    In your response letter to these SEC Staff comments, please include your previous responses to SEC Staff comments received on the Other Fund.

Response:    Registrant is including, as Appendix A, our previous response to SEC Staff comments received on the Other Fund.  We received no other comments from the SEC staff with respect to the Other Fund.

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Comment 7:      Please provide additional disclosures to the fee table that explain the high expense ratios of Class A and Institutional Class shares.

Response:    Registrant has revised footnote 4 to the fee table to the following:

Based on estimated amounts for the current fiscal year.  The estimated “Other Expenses” for Class A and Institutional Class shares were calculated based on the low assets under management (AUM) expected for those share classes in the first fiscal year.  During that fiscal year, PGI anticipates limited marketing and sales of Class A and Institutional Class shares compared to Class Y shares.  Given the expected low AUM for Class A and Institutional Class shares, there is a greater impact on their “other expenses” from fixed expenses, such as registration fees.  Actual fees and expenses may be greater or less than those shown. Includes amounts paid under an Administration Agreement between the Fund and PGI as administrator.

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Please call me at (515) 247-6651 if you have any questions.

Sincerely,

/s/ John L. Sullivan

John L. Sullivan

Counsel and Assistant Secretary, Registrant

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APPENDIX A

November 14, 2023

Via EDGAR

Raymond Be, Esq.

Division of Investment Management

Securities and Exchange Commission

100 F Street, NE

Washington D.C. 20549

Re:    Principal Private Credit Fund (the “Registrant”)

File Numbers 333-274212, 811-23897

Initial Registration Statement on Form N-2 (the “Form N-2”)

Dear Mr. Be:

This letter responds, on behalf of the Registrant, to the written comments of the Staff of the Securities and Exchange Commission (the “SEC”), dated October 3, 2023, with respect to the Form N-2.  The Registrant will make changes in response to SEC Staff comments as described below in a pre-effective amendment that will be filed with the Commission.

Comment 1:  We note that portions of the filing, including the Fund’s financial statements, are incomplete. We may have additional comments on such portions when you complete them in a pre-effective amendment, on disclosures made in response to this letter, on information supplied supplementally, or on exhibits added in any amendments.

Response:  Understood.

Comment 2:  Please supplementally explain the status of any exemptive relief or no-action request submitted, or expected to be submitted, in connection with the registration statement.

Response:  Registrant can rely on two existing exemptive orders to operate as a multi-class interval fund that seeks to co-invest with affiliated entities:  Investment Company Act Release No. 33466 (May 6, 2019) (Multi-Class) and Investment Company Act Release No. 34125 (Dec. 1, 2020) (Co-Investment).   Registrant is not currently seeking any additional exemptive orders with the SEC.

Comment 3:  Please tell us if you have presented any test-the-waters materials in connection with this offering. We may have additional comments based on your response.

Response:  Registrant has not presented any test-the-water materials in connection with this offering.

Comment 4:  Section 8(c) of the Securities Act relates to post-effective amendments. Please remove the check from the box next to “when declared effective pursuant to Section 8(c).”

Response:  Registrant has so removed.

Comment 5:  The disclosure on page 16 of the SAI states that the Fund will include financial statements for a “to-be-acquired affiliated 3(c)(1)/(7) entity.” Please discuss this proposed transaction in an appropriate location in the prospectus.

Response:  Registrant has added a discussion to this effect in the “ADDITIONAL INFORMATION” section of the prospectus.

For your reference, here is that disclosure:

The Fund intends to acquire substantially all the assets of a wholly owned subsidiary of Principal Life Insurance Company, an insurance company that is under common control with the Fund’s investment adviser, PGI.  The subsidiary will qualify as a 3(c)(1) and a 3(c)(7) entity and its assets will consist of private credit instruments, which are consistent with the Fund’s investment objective and principal investment strategies as disclosed in this prospectus.  In exchange for the private credit instruments, the Fund will issue shares.  This acquisition will comply with the guidance issued by the SEC staff in the December 27, 2006 letter issued to GuideStone Financial, et al.  The subsidiary is a newly created entity, organized for the purpose to fund the Fund with private credit instruments.  PGI believes that the Fund’s acquisition of the subsidiary’s private credit instruments will allow the Fund to meet its investment objective and principal investment strategies more quickly than it would otherwise be able to do.  There is no guarantee, however, that the private credit instruments acquired will perform as expected or that the Fund will achieve its investment objective.

In addition, the SEC Staff has asked the Registrant (or adviser to the Registrant) to explain whether it can rely on the December 27, 2006 SEC Staff letter issued to Guidestone Financial, et al. (the “Guidestone Letter”) for its acquisition of substantially all of the assets of the newly created and wholly owned subsidiary (the “subsidiary”).

The Guidestone Letter, on its face, appears to apply to our facts.  Footnote 13 states, in relevant part:

In those orders, the Commission granted exemptive relief pursuant to section 17(b) of the 1940 Act to certain entities that were relying on the exclusions from the definition of investment company in sections 3(c)(1), 3(c)(7) and 3(c)(11) of the 1940 Act to allow them to transfer all or substantially all of their assets in exchange for shares of newly created registered open-end investment companies. You contend that similar relief should be available for other entities that are excepted from the definition of investment company by other provisions of the 1940 Act, including, as relevant here, section 3(c)(14) of the 1940 Act. We agree.

The SEC Staff, in the Guidestone Letter, did not limit the application of the Letter to 3(c)(1) or 3(c)(7) entities based on the length of time that the entity existed.  In addition, the Registrant’s proposed acquisition of substantially all of the assets of the subsidiary (the “subsidiary assets”) will comply with the guardrails established in the Guidestone Letter, none of which appears to address the length of time that the 3(c)(1) or 3(c)(7) entity has existed.

Those guardrails include, among others, independent board member approval of the acquisition; independent board member approval of the applicable valuation policies (including the use of an independent evaluator); and the in-kind consideration accepted by the Fund will consist of securities (i.e., private credit instruments) that are appropriate, in type and amount, for investment by the Fund in light of its investment objective and policies.  Further, management expect that, at the time of the Fund’s acquisition of the subsidiary assets, there will only be one affiliated seed investor in the Fund.

In addition, management of the Fund believes that it is in the best interests of the Fund shareholders if the Fund were to acquire the subsidiary assets.  The Fund’s acquisition of the subsidiary’s securities allows the Fund shareholders to have immediate exposure to hard-to-source private credit instruments, the core focus of the Fund.  The Fund’s acquisition of the subsidiary assets will also enhance the Fund’s diversification, providing benefits from a portfolio management perspective as well as enabling the Fund to comply more efficiently with applicable investment requirements and limitations, including, among others, tax diversification under the Internal Revenue Code of 1986 and Rule 35d-1 under the Investment Company Act of 1940 (the “1940 Act”).  Moreover, although the subsidiary will be newly created, its assets, the private credit investments, will be a seasoned pool of loans contributed to it by the parent insurance company.  This seasoned pool of assets will consist of loans that will be gradually paying off at different times, thereby enhancing the overall liquidity of the Fund.  The Fund shareholders will not have these immediate benefits if the Fund is not able to purchase the subsidiary assets.

For its acquisition of the subsidiary assets, Registrant intends to provide the financial disclosu