Fund Description: Invesco Fundamental Investment Grade Corporate Bond ETF, formerly PowerShares Fundamental Investment Grade Corporate Bond Portfolio is an exchange-traded index fund or Index ETF which is a separate investment portfolio of the Invesco Exchange-Traded Fund Trust II, formerly PowerShares Exchange-Traded Fund Trust II, an open-end investment management company. INVESTMENT OBJECTIVE: The Invesco Fundamental Investment Grade Corporate Bond ETF seeks investment results that correspond, before fees and expenses, to the price and yield of the RAFI Investment Grade Bond Index. INDEX DESCRIPTION: The RAFI Investment Grade Bond Index represents the performance of a theoretical portfolio of investment grade corporate bonds that must be rated BBB/Baa or higher by both Moody's Investors Service, Inc. and Standard & Poor. The Index is comprised of U.S. dollar-denominated bonds registered for sale in the United States whose issuers are public companies listed on a major U.S. stock exchange. The Index is comprised of bonds with weighted average credit ratings of A3/A. As of June 30, 2011 the Index consisted of 410 securities with a weighted average maturity of 5.8 years and a current modified duration of 4.8 years. Only securities with greater than one year to maturity qualify for inclusion in the Index. In determining each individual security's relative weight within the Index, Research Affiliates, LLC, the Index Provider, utilizes four fundamental corporate accounting variables: book value of assets, gross sales, gross dividends and cash flow. A composite fundamental weight is calculated for each security by comparing its four fundamental variables against those of the other issuers in the Index universe. FUND STRATEGY: The Fund will normally invest at least 80% of its total assets in the securities that comprise the Index. The Fund, using an indexing investment approach, attempts to replicate, before fees and expenses, the performance of the Index. The Fund generally invests in all of the securities comprising the Index in proportion to their weightings in the Index. However, under various circumstances, it may not be possible or practicable to purchase all of those securities in those weightings. In those circumstances, the Fund may purchase a sample of securities in the Index. Sampling involves the use of quantitative analysis to select securities from the Index to obtain a representative sample of municipal securities that have in the aggregate investment characteristics similar to the Index based on such factors as duration, maturity, credit quality, yield and coupon. Generally it is expected that the Fund will hold less than the total number of securities in the Index but reserves the right to hold as many securities as it believes necessary to achieve the Fund's investment objective. FUND MANAGEMENT: Invesco Capital Management LLC serves as the investment adviser to the Fund.