13, 2016
four directors and the ratification of the appointment of our independent registered public accounting firm.
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Sincerely, |
15, 2016 if necessary. 15, 2016. colecapital. A “quorum” consists of the presence in person or by proxy of stockholders holding 50% of the outstanding shares entitled to vote. There must be a quorum present in order for business to be transacted at the annual 02205-5909 George N. Fugelsang Richard J. Lehmann Roger D. Snell such nominee for re-election as director. DIRECTORS AND OFFICERS Entity Position(s) George N. Fugelsanghas served as a director since September became chairman and chief executive officer of Valley National Bank of Arizona and served in that capacity until the bank was sold to Banc One Corporation in 1993. Mr. Lehmann remained with the combined company and was appointed president and chief operating officer of Banc One and as a member of its board of directors in 1995. Following the merger of Banc One with First Chicago NBD Corporation to form Bank One Corporation in 1998, Mr. Lehmann served as vice chairman of the combined entity with responsibility for all consumer banking activities until his retirement on December 31, 1999. Mr. Lehmann also serves on the is attached 2015. Committee circumstances of the Company. Company’s financial statements, the Company’s compliance with legal and regulatory requirements and the adequacy of the Company’s internal control over financial reporting. an annual retainer of $50,000; $2,000 for each board meeting attended in person; an additional annual retainer of $10,000 to the chairman of the board of directors and $7,500 to the chairman of the audit committee; $2,000 for each committee meeting attended in person (the audit committee chairperson receives an additional $500 per audit committee meeting for serving in that capacity); $250 per board or committee meeting attended by telephone conference; and in the event that there is a meeting of the board of directors and one or more committees on a single day, the fees paid to each director will be limited to $2,500 per day ($3,000 per day for the chairperson of the audit committee, if there is a meeting of that committee). Name Michael T. Ezzell T. Patrick Duncan George N. Fugelsang Richard J. Lehmann Roger D. Snell Christopher H. Cole (2) Marc T. Nemer (2) William M. Kahane (3) Nicholas S. Schorsch (3) file with the SEC, within specified time frames, initial statements of beneficial ownership (Form 3) and statements of changes in beneficial ownership (Forms 4 and 5) of common stock of the Company. Directors, officers and greater than 10% beneficial owners are required by SEC rules to furnish the Company with copies of all such forms they file. Based solely 2015. Entity Senior vice president of accounting and principal accounting officer Vice president of accounting and principal accounting officer CCPT II Vice president of accounting and principal accounting officer Cole Real Estate Senior vice president of accounting and principal accounting officer Vice president of accounting and principal accounting officer Senior vice president of accounting and principal accounting officer Vice president of accounting and principal accounting officer CCPT V CCPT V CCIT officer of our Company. George N. Fugelsang Richard J. Lehmann Roger D. Snell Simon J. Misselbrook All executive officers and directors as a group provided certain tax and other services. The audit committee reviewed the audit and non-audit services performed by Deloitte, Audit fees Audit-related fees Tax fees All other fees Total The audit committee charter imposes a duty on the audit committee to pre-approve all auditing services performed for us by our independent auditors, as well as all permitted non-audit services (including the fees and terms thereof) in order to ensure that the provision of such services does not impair the auditors’ independence. Unless a type of service to be provided by the independent auditors has received “general” pre-approval, it will require “specific” pre-approval by the audit committee. GAAP. 2015. those positions. its maturity. STOCKHOLDER PROPOSALS The 20152016 ANNUAL MEETING OF STOCKHOLDERS2, 201520152016 Annual Meeting of Stockholders of Cole Real Estate Income Strategy (Daily NAV), Inc., a Maryland corporation (the “Company,” “we,” or “us”), will be held on Tuesday,Wednesday, June 2, 2015,15, 2016, at 9:0010:30 a.m. local time at our offices located at 2325 E. Camelback Road, Suite 1100, Phoenix, Arizona 85016. The purposespurpose of the meeting areis to consider and vote upon:1. The election of fivefour directors to hold office until the 20162017 Annual Meeting of Stockholders and until their successors are duly elected and qualify;2. The ratification of the appointment of Deloitte & Touche LLP (“Deloitte”) as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2016; and 2.3. The transaction of such other business as may properly come before the meeting or any adjournment or postponement thereof. 30, 201531, 2016 are entitled to receive this notice and to vote at the meeting. We reserve the right, in our sole discretion, to postpone or adjourn the 20152016 Annual Meeting of Stockholders to provide more time to solicit proxies for the meeting, for any or all of the above purposes of the meeting.2, 2015.colecapital20152016 Annual Meeting of Stockholders of the Company by calling 1-866-907-2653. By Order of the Board of Directors 
Phoenix, Arizona
April 13, 2016 
Phoenix, ArizonaApril 14, 201520152016 Annual Meeting of Stockholders. To make this information easier to understand, we have presented some of the information below in a question and answer format.Q:Q: Why did you send me this proxy statement? A: Our board of directors is soliciting your proxy to vote your shares of the Company’s common stock at the 20152016 Annual Meeting of Stockholders. This proxy statement includes information that we are required to provide to you under the rules of the Securities and Exchange Commission (“SEC”) and is designed to assist you in voting. This proxy statement, the proxy card and our 20142015 annual report to stockholders are being mailed to you on or about April 20, 2015.13, 2016.Q:Q: What is a proxy? A: A proxy is a person who votes the shares of stock of another person. The term “proxy” also refers to the proxy card. When you return the enclosed proxy card, or authorize your proxy by telephone or over the Internet, you are giving your permission to vote your shares of common stock at the annual meeting. The person who willeither our chief financial officer and treasurer or our secretary to vote your shares of common stock at the annual meeting is either Simon J. Misselbrook or Michael J. Komenda. One or both of them will vote your shares of common stock as you instruct. If you sign and return the proxy card, or authorize your proxy by telephone or over the Internet, and give no instructions, the proxies will vote FOR ALLall of the director nominees.nominees and FOR the ratification of the appointment of Deloitte as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2016. With respect to any other proposals to be properly presented at the meeting for voting, your shares will be voted in accordance with the recommendation of the board of directors or, in the absence of such a recommendation, in the discretion of one or both of the proxies. The proxies will not vote your shares of common stock if you do not return the enclosed proxy card or authorize your proxy by telephone or over the Internet. This is why it is important for you to return the proxy card to us or authorize your proxy by telephone or over the Internet as soon as possible whether or not you plan on attending the meeting in person.If you authorize your proxy by telephone or over the Internet, please donot return your proxy card.Q:Q: When is the annual meeting and where will it be held? A: The annual meeting will be held on Tuesday,Wednesday, June 2, 2015,15, 2016, at 9:0010:30 a.m. local time at our offices located at 2325 E. Camelback Road, Suite 1100, Phoenix, Arizona 85016.Q:Q: How many shares of common stock can vote? A: As of the close of business on the record date of March 30, 2015,31, 2016, there were 7,255,00311,407,488 shares of our common stock issued and outstanding. Every stockholder of record as of the close of business on March 30, 201531, 2016 is entitled to one vote for each share of common stock held at that date and time and all of our outstanding classes of common stock will vote together as a single class. Fractional shares will have corresponding fractional votes.Q:Q: What is a “quorum”? A: 1meeting. If you submit a properly executed proxy card, even if you abstain from voting or do not give instructions for voting, then you will at least be considered part of the quorum. Q:Q: What may I vote on? A: (ii)(iii) any other proposal properly presented for a vote at the annual meeting.Q:Q: How does the board of directors recommend I vote on the proposal?proposals?A: The board of directors recommends a vote “FOR ALL”“FOR” all of the nominees for election as director who are named as such in this proxy statement.statement and “FOR” ratification of the appointment of Deloitte as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2016.Q:Q: Who is entitled to vote? A: Anyone who owned our common stock at the close of business on March 30, 2015,31, 2016, the record date, is entitled to vote at the annual meeting.Q:Q: How do I vote? A: You may vote your shares of common stock either in person or by proxy. In order to vote in person, you must attend the annual meeting. Whether you plan to attend the meeting and vote in person or not, we urge you to have your vote recorded. Stockholders may authorize their proxy via mail, using the enclosed proxy card. In addition, stockholders who live in the United States may authorize a proxy by following the “Vote by Phone” instructions on the enclosed proxy card. Stockholders with Internet access may authorize a proxy by following the “Vote by Internet” instructions on the enclosed proxy card. The telephone and Internet proxy authorization procedures are designed to authenticate the stockholder’s identity and to allow stockholders to authorize a proxy and confirm that their instructions have been properly recorded. If the telephone or Internet option is available to you, we strongly encourage you to use it because it is faster and less costly. If you attend the annual meeting, you also may vote in person, and any previous proxies that you authorized will be superseded by the vote that you cast at the annual meeting. You may also attend the annual meeting without revoking any previously authorized proxy. If you return your signed proxy card, or authorize your proxy by telephone or over the Internet, but do not indicate how you wish to vote, your shares of common stock will be counted as present for purposes of determining a quorum and voted (i) FOR ALLall of the nominees for director; (ii) FOR the ratification of the appointment of Deloitte as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2016; and (ii)(iii) with respect to any other proposals to be voted upon, in accordance with the recommendation of the board of directors or, in the absence of such a recommendation, in the discretion of the proxies.Q:Q: What vote is required to approve each proposal that comes before the annual meeting?proposal?A: To elect a director nominee, theathe annual meeting at which a quorum is present must be cast in favor ofis required for the election of theeach director nominee. Abstentions and broker non-votes will counthave the same effect as votes cast against each director nominee.proposal to electvotes cast at the director nominees.annual meeting at which a quorum is present is required for ratifying the appointment of Deloitte as the Company’s independent registered public accounting firm for the fiscal year ending December 31, 2016. Abstentions and broker non-votes will have no effect on the outcome of this proposal.Q:Q: Will my vote make a difference? A: SHARES!SHARES. Your immediate response will help avoid potential delays and may save us significant additional expense associated with soliciting stockholder votes. We encourage you to participate in the governance of the Company and welcome your attendance at the annual meeting.Q:Q: What if I return my proxy card and then change my mind? A: You have the right to revoke your proxy at any time before the vote by: (1) notifying Michael J. Komenda, our secretary, in writing at our offices located at 2325 East Camelback Road, Suite 1100, Phoenix, Arizona 85016; (2) attending the meeting and voting in person; or (3) returning another proxy after your first proxy, which is received before the annual meeting date. Only the most recent vote will be counted and all others will be discarded regardless of the method of voting. Q:Q: How will voting on any other business be conducted? A: Simon J. Misselbrook, our chief financial officer and treasurer, and Michael J. Komenda, our secretary, or either of them,official designated proxy to vote on such matters in accordance with the recommendation of the board of directors or, in the absence of such a recommendation, in their discretion.Q:Q: Who pays the cost of this proxy solicitation? A: The Company will pay all the costs of soliciting these proxies. The Company will also reimburse brokerage houses and other custodians, nominees and fiduciaries for their reasonable out-of-pocket expenses for forwarding proxy and solicitation materials to our stockholders. Q:Q: Is this proxy statement the only way that proxies are being solicited? A: $4,000.$15,000.Q:Q: If I plan to attend the annual meeting in person, should I notify anyone? A: While you are not required to notify anyone in order to attend the annual meeting, if you do plan to attend the meeting, we would appreciate it if you would call us toll free at 1-866-907-2653 to let us know that you will be attending the meeting so that we will be able to prepare a suitable meeting room for the attendees. Q:Q: Whom should I call if I have any questions? A: If you have any questions about how to submit your proxy, or if you need additional copies of this proxy statement or the enclosed proxy card or voting instructions, you should contact: 859232Braintree,5590902185-9919fivefour members of our board of directors. Those persons elected will serve as directors until the 20162017 Annual Meeting of Stockholders and until their successors are duly elected and qualify. The board of directors has nominated the following people for re-election as directors:Michael T. EzzellT. Patrick Duncan without the necessity for concurrence by the board of directors, is necessary for the election of a director. For purposes of the election of directors, abstentions and broker non-votes will have the same effect as votes cast against each director. A properly executed proxy card, or instruction by telephone or over the Internet, indicating “FOR ALL”“FOR” a nominee will be considered a vote in favor of all nomineessuch nominee for re-election as director. A properly executed proxy card, or instruction by telephone or over the Internet, indicating “FOR ALL EXCEPT”“AGAINST” will be considered a vote in favor of all nominees except those nominees you specifically list and have the effect of a vote against the nominees you specifically list. A properly executed proxy card, or instruction by telephone or over the Internet, indicating “WITHHOLD ALL” will have the effect of a vote against all directors.“FOR ALL”“FOR” ALL OF THE NOMINEES FOR ELECTION AS DIRECTORSCERTAIN MANAGEMENT4It also is expected that independent directors nominated by the board of directors will be individuals who possess a reputation and hold positions or affiliations befitting a director of a large publicly held company and are actively engaged in their occupations or professions or are otherwise regularly involved in the business, professional or academic community. A majority of our directors must be independent, as defined in our charter. Moreover, as required by our charter, at least one of our independent directors must have at least three years of relevant real estate experience, and each director must have at least three years of relevant experience demonstrating the knowledge and experience required to successfully acquire and manage the type of assets we acquire and manage. own nominees and recommending them for election by the stockholders. Each of our nominees was recommended by our board of directors. Pursuant to our charter, however, the independent directors must nominate replacements for any vacancies among the independent director positions. All director nominees then stand for election by the stockholders annually.520162017 Annual Meeting of Stockholders and until his successor is elected and qualifies. Each nominee currently is a director of the Company, and Messrs. Duncan, Fugelsang, Lehmann and Snell are independent directors.Name Age PositionsMichael T. Ezzell 40Age Positions Glenn J. Rufrano 66 Chief Executive Officer and President and Director George N. Fugelsang 75 Non-Executive Chairman of the Board of Directors Chief Executive Officer and President(Independent Director)T. Patrick Duncan 6672 Independent Director (Independent)George N. Fugelsang 7460 Independent Director (Independent)Richard J. Lehmann71Director (Independent)Roger D. Snell59Director (Independent)Michael T. EzzellGlenn J. Rufrano has served as our chairman of the board of directors, chief executive officer and president and one of our directors since December 2014 andJune 2015. Mr. Rufrano also has served as chief executive officer and president of Cole Real Estate Income Strategy (Daily NAV) Advisors, LLC (“Cole Income NAV Strategy Advisors”), our advisor, since December 2014, and previously served as executive vice president of our advisor from March 2014 until December 2014.June 2015. In addition, Mr. EzzellRufrano serves or served in the following positions for certain other programs sponsored by Cole Capital and certain affiliates of Cole Capital: Position(s) Dates Cole Office and Industrial REIT (CCIT II), Inc. (“CCIT II”); Cole Credit Property Trust V, Inc. (“CCPT V”) , Cole Office & Industrial REIT (CCIT II), Inc. (“CCIT II”)Chairman of the board of directors, chief executive officer and president December 2014June 2015 – Present Cole Capital Corporation President and treasurer December 2014 – PresentExecutive vice presidentMarch 2014 – December 2014Cole REIT Advisors, LLC (“CCPT I Advisors”); Cole REIT Advisors III, LLC (“CCPT III Advisors”); Cole Corporate Income Advisors, LLC (“CCIT Advisors”); Cole Corporate Income Advisors II, LLC (“CCIT II Advisors”) ,; Cole REIT Advisors V, LLC (“CCPT V Advisors”), Cole Capital Partners, LLC (“Cole Capital Partners”),; Cole Capital Advisors, Inc. (“Cole Capital Advisors”) December 2014 – Present Executive vice president March 2014 – December 2014Cole REIT Advisors, LLC (“CCPT I Advisors”), Cole REIT Advisors III, LLC (“CCPT III Advisors”), Cole Corporate Income Advisors, LLC (“Cole Corporate Income Advisors”), Cole REIT Advisors IV, LLC (“CCPT IV Advisors”) Executive vice presidentMarch 2014 – PresentEzzellRufrano has served as the chief executive officer and a director of VEREIT, Inc. (“VEREIT”), a publicly traded full-service real estate operating company (NYSE: VER) and the indirect parent of our sponsor, advisor, dealer manager and property manager. Mr. Rufrano has served and continues to serve as a director of Ventas, Inc., a publicly traded senior housing and healthcare REIT, since June 2010 and of O’Connor Capital Partners, a privately-owned, independent real estate investment, development and management firm that he co-founded, since October 2013. He served as chairman and chief executive officer of O’Connor Capital Partners from November 2013 through March 2015. He also served as a director for Columbia Property Trust, Inc., a publicly traded commercial real estate REIT, from January 2015 until March 2015. Previously, Mr. Rufrano was president and chief executive officer of Cushman & Wakefield, Inc., a privately-held commercial property and real estate services company, and a member of its board of directors from March 2010 to June 2013. From January 2008 through February 2010, he served as chief executive officer of Centro Properties Group, an Australian-based shopping center company, and, from April 2007 through January 2008, Mr. Rufrano served as chief executive officer of Centro Properties Group U.S. From 2000 until its acquisition by Centro Properties Group in April 2007, he served as chief executive officer and president of Cole Capital since December 2014. He previously served as executive vice president, private capital markets at Cole Capital from March 2014 until December 2014. In his current role, Mr. Ezzell provides strategic direction and oversees all aspects of the management of Cole Capital, including product development, external and internal sales, marketing, broker/dealer relations, due diligence and securities operations. Mr. Ezzell served as senior vice president, product and business development at Cole Capital from January 2010 until March 2014. Prior to joining Cole Capital and its affiliates in January 2010, Mr. Ezzell was employed by AIG Advisor Group from November 2004 until January 2010, most recently asa director of investment research.New Plan Excel Realty Trust, a commercial retail REIT. He presently serves on the Board of New York University’s Real Estate Institute. Mr. Ezzell was actively involvedRufrano received his Bachelor’s degree in the due diligenceBusiness Administration from Rutgers University and6research his Masters of all packaged investment productsScience degree in Management and programs for AIG Advisor Group’s four independent broker-dealers with a network of approximately 6,000 independent financial advisors.Real Estate from Florida International University. Mr. Ezzell also served with J.P. Carey Asset Management from 1998 until 2004, most recently as vice president. Mr. Ezzell received a B.A. degree with a double major in Economics and Political Science from Stetson University. He holds FINRA Series 7, 24 and 63 licenses.Mr. EzzellRufrano was selected to serve as a director because of his extensive real estate and capital markets experience and investment expertise, in addition to his leadership role at Cole Capital,VEREIT, all of which are expected to bring valuable insight to the board of directors.T. Patrick Duncanhas served as a director since August 2013. Mr. Duncan has served as Vice Chairman of USAA Real Estate Company, a private real estate investment company, since May 2013. For 27 years Mr. Duncan served in various roles at USAA Real Estate, most recently as its chief executive officer from January 2005 until he retired in May 2013. Mr. Duncan also held the position of Senior Vice President, Real Estate Operations with USAA Real Estate with responsibilities that included the direction of all acquisitions, sales, co-investments, build-to-suits, land development capital markets, management and leasing of real estate. Before joining USAA Real Estate in 1986, Mr. Duncan was with Trammell Crow Company in Dallas, Texas with responsibilities as a financial partner of the firm and prior to that, Mr. Duncan was a manager with Deloitte & Touche. Mr. Duncan previously served on the boards of Meridian Industrial Trust, a former New York Stock Exchange-listed REIT, from 1994 to 1998, and American Industrial Properties REIT, a former New York Stock Exchange-listed REIT, from 1996 to 2001. Mr. Duncan serves on the boards of Square Mile Capital Management, LLC, a diversified real estate investment firm, the Texas Research and Technology Foundation and the University Health System Foundation. Mr. Duncan received a degree from the University of Arizona and is a Certified Public Accountant, Certified Commercial Investment Member, and holds a Texas Real Estate Broker’s License. Mr. Duncan was selected to serve as a director because of his extensive experience as a real estate industry executive with executive investment, capital markets and financial expertise, all of which are expected to bring valuable insight to the board of directors.2011.2011 and as non-executive chairman of our board of directors since June 2015. Mr. Fugelsang served as a member of the board of directors, audit committee and compensation committee of Cole Credit Property Trust II, Inc. (“CCPT II”) from May 2010, June 2010 and May 2011, respectively, until CCPT II’s merger with Spirit Realty Capital, Inc. in July 2013. From 1994 through 2001, Mr. Fugelsang was chief executive officer of Dresdner Kleinwort Benson North America, the U.S.-based investment banking business of Dresdner Bank AG, where he was responsible for all of Dresdner Bank AG’s activities in North America. From 1996 until 2001, Mr. Fugelsang was also chairman of the board of Dresdner Bank Mexico, S.A., chairman of the board of Dresdner Bank Canada and a member of the board of directors of Dresdner RCM Global Investors LLC. Mr. Fugelsang served on the board of managers of Mrs. Fields’ Famous Brands, LLC from May 2004 until July 2008. Mr. Fugelsang also served on the boards of trustees of the Institute of International Bankerssince 2002 and previously served as chairman of Bank Capital Corporation, its former holding company, from 2002 until 2014. In 2014, The Biltmore Bank of Arizona was sold to Grandpoint Capital, Inc., a bank holding company headquartered in California. Mr. Lehmann serves on the board of directors of Grandpoint Capital.since 2002. Mr. Lehmann began his banking career with Citibank in 1969. When he left Citibank in 1988, he was senior corporate officer for Europe, Middle East and Africa. In 1988, he7boardsboard of directors and on the compensation, committeenominating and governance and executive committees of Knight Transportation, Inc., and as a director and chairman of the finance and investments committee of the TGen Foundation. He previously served on the boards of eFunds Corporation, iCrossing, Inc., Moore Corporation, and the Thunderbird School of Global Management. Prior civic activities include board participation with the Phoenix Art Museum, Ohio State University Hospital, Greater Phoenix Leadership, United Way of Greater Phoenix (campaign Chairman), and The Nature Conservancy of Arizona. Mr. Lehmann received an MBA and BA from the University of Washington. Mr. Lehmann was selected to serve as a director because of his experience as a financial services industry executive, with strong leadership, finance and global experience, all of which are expected to bring valuable insight to the board of directors.PriorIn 1996, prior to joining Peregrine, Mr. Snell was managing director of Snell & Co., LLC, an investment advisory firm, in 1996, and president and chief executive officer of Perini Investment Properties, a publicly traded REIT focusing on commercial real estate and hotel properties (later renamed Pacific Gateway Properties), from January 1993 to January 1996. Prior to joining Perini, Mr. Snell held various leadership positions in other commercial real estate investment and development companies. Mr. Snell received an MBA from Harvard Business School and a B.S. degree from the University of California, Berkeley. Mr. Snell was selected to serve as a director because of his experience as a real estate industry executive with executive investment, capital markets and portfolio management expertise, all of which are expected to bring valuable insight to the board of directors.tensix meetings during the fiscal year ended December 31, 2014.2015. Each director during the fiscal year ended December 31, 20142015 attended at least 75%80% of his board and committee meetings in 2014.2015. Although we do not have a formal policy regarding attendance by members of our board of directors at our Annual Meeting of Stockholders, we encourage all of our directors to attend. All but one of our directors at the time of our 20142015 Annual Meeting of Stockholders attended our 20142015 Annual Meeting of Stockholders either in person or by conference telephone.The board consults with our legal counsel and counsel to the independent directors to ensure that the board’s determinations are consistentConsistent with our charter and applicable securities and other laws and regulations regarding the definition of “independent.“independent,”Consistent with these considerations, after review of all relevant transactions or relationships between each director, or any of his family members, and the Company, our senior management and our independent registered public accounting firm, the board has determined that Messrs. Duncan, Fugelsang, Lehmann and Snell, who comprise a majority of our board, qualify as independent directors. A copy of our independent director definition, which is contained in our charter and complies with the requirements of the North American Securities Administrators Association’s Statement of Policy Regarding Real Estate Investment Trusts, was8as an appendix to the proxy statement for our 2013 Annual Meeting of Stockholders, which was filed with the SEC on April 19, 2013.hereto atcomposedcomprised of Mr. Snell (chairman) and Mr. Fugelsang, both of whom are independent directors. The audit committee reports regularly to the full board. The audit committee meets periodically during the year, usually in conjunction with regular meetings of the board. The audit committee, by approval of at least a majority of the members, selects the independent registered public accounting firm to audit our annual financial statements, reviews with the independent registered public accounting firm the plans and results of the audit engagement, approves the audit and non-audit services provided by the independent registered public accounting firm, reviews the independence of the independent registered public accounting firm, considers the range of audit and non-audit fees and reviews the adequacy of our internal accounting controls. Our board of directors has adopted a charter for the audit committee that sets forth its specific functions and responsibilities. The audit committee charter can be located on our website at https://www.colecapital.com/cinav_corporate_governance by clicking on “Cole Income NAV Strategy Audit“Audit Committee Charter.”bothall members of the audit committee meet the current independence and qualifications requirements of the New York Stock Exchange, as well as our charter and applicable rules and regulations of the SEC. While both members of the audit committee have significant financial and/or accounting experience, the board of directors has determined that Mr. Snell satisfies the SEC’s requirements for an “audit committee financial expert” and has designated Mr. Snell as our audit committee financial expert. The audit committee met fivefour times during 2014.Board of Directors – Functions9Structure; Independent Lead DirectorStructureMichael T. Ezzell servesIn recognition of the time commitments and activities required to function effectively as both ourthe chief executive officer and chairman of the board of directors, and chief executive officer. Theour board of directors believes that independent oversight of management is an important component of an effective board of directors. The independent directors have determined that the most effective board of directors leadership structure for the Company at the present time is for thehas separated these roles, with Mr. Rufrano serving as our chief executive officer to also serveand president and Mr. Fugelsang serving as our non-executive chairman of the board of directors. The independent directors believe that because the chief executive officer is ultimately responsible for the day-to-day operation of the Company and for executing the Company’s strategy, and because the performance of the Company is an integral part of board deliberations, the chief executive officer is the director best qualified to act as chairman of the board of directors. The board of directors retains the authority to modify this structure to best address the Company’s unique circumstances, and to advance the best interests of all stockholders, as and when appropriate. In addition, although we do not have a lead independent director, thesince June 2015. Our board of directors believes that the current separation of the roles of chief executive officer and chairman allows Mr. Rufrano to focus his time and energy on operating and managing the Company while leveraging the experience and perspectives of Mr. Fugelsang in helping to set the strategic direction of the Company. The board of directors has determined that the current board leadership structure is the most appropriate asat this time, given the Company has no employeesspecific characteristics and is externally managed by our advisor, whereby all operations are conducted by our advisor or its affiliates.accountability, which is the goal that many seek to achieve by separating the roles of chairman of the board of directors and chief executive officer.accountability. Our governance practices provide for strong independent leadership, independent discussion among directors and for independent evaluation of and communication with our executive officers, andas well as the officers and key personnel of our advisor. Some of the relevant processes and other corporate governance practices include:A majority of our directors are independent directors. Each director is an equal participant in decisions made by the full board of directors. In addition, all matters that relate to our sponsor, our advisor or any of their affiliates must be approved by a majority of the independent directors. The audit committee is comprised entirely of independent directors.Each of our directors is elected annually by our stockholders.Our advisor has a one-year contract, with an annual review by, and renewal subject to the approval of, our board of directors. The fees paid to our advisor must be deemed reasonable, as determined by our independent directors, on an annual basis.• A majority of our directors are independent directors. Each director is an equal participant in decisions made by the full board of directors. In addition, all matters that relate to our sponsor, our advisor or any of their affiliates must be approved by a majority of the independent directors. The audit committee is comprised entirely of independent directors. • Each of our directors is elected annually by our stockholders. • Our advisor has a one-year contract, with an annual review by, and renewal subject to the approval of, our board of directors. The fees paid to our advisor must be deemed reasonable, as determined by our independent directors, on an annual basis. full board of directors is actively involved in overseeing risk management for the Company. It does so, in part, through its oversight of our property acquisitions and assumptions of debt, as well as its oversight of ourCompany’s executive officers and our advisor. In particular, the board of directors may determine at any time to terminate the advisor, and must evaluate the performance of the advisor, and re-authorize the advisory agreement, on an annual basis.10TheIn addition, we have adopted policies and procedures with respect to complaints related toreviews any potential material issues that are raised related to the Company’s financial statements or accounting policies. Additionally,shall discuss with management. Further, in connection with the annual audit of the Company’s financial statements, the audit committee conducts a detailed review with the Company’s independent auditors of the accounting policies used by the Company and its financial statement presentation.Code of Business Conduct and Ethicspolicy may be located on our website at https://www.colecapital.com/cinav_corporate_governance by clicking on “Cole Income NAV Strategy Code“Code of Business Conduct and Ethics.” If, in the future, we amend,Ezzell)Rufrano) do not receive any special or additional remuneration for service on the board of directors or any of its committees. Each non-employee director receives compensation for service on the board of directors and any of its committees as provided below: Independent directors are not reimbursed by the Company, our sponsor, our advisor or any of their affiliates for spouses’ expenses to attend events to which spouses are invited.112014: Fees
Earned
or Paid
in Cash Stock
Awards
($) Option
Awards
($) Non-Equity
Incentive Plan
Compensation
($) Change in
Pension Value
and
Nonqualified
Deferred
Compensation
Earnings All Other
Compensation
(1)($) Total ($) — — — — — — — $ 56,000 — — — — $ 4,068 $ 60,068 $ 57,500 — — — — — $ 57,500 $ 54,250 — — — — — $ 54,250 $ 65,500 — — — — $ 2,085 $ 67,585 — — — — — — — — — — — — — — — — — — — — — — — — — — — — Name
or Paid in
Cash Stock
Awards
($) Non-Equity
Incentive Plan
Compensation
($) All Other
Compensation
($) Total Compensation ($) Glenn J. Rufrano $ — $ — $ — $ — $ — George N. Fugelsang 60,637 — — — 60,637 Richard J. Lehmann 52,250 — — — 52,250 Roger D. Snell 62,250 — — — 62,250 37,041 — — — 37,041 — — — — — (1) Amount represents reimbursement of travel and meal expenses incurred by directors to attend various director meetings.(2)Messrs. Cole and NemerMr. Duncan resigned as membersa member of our board of directors in February 2014.September 2015.(3)(2)Messrs. Kahane and SchorschMr. Ezzell resigned as membersa member of our board of directors in December 2014.June 2015.Our currentalso serve orMichael T. Ezzell, served as executive officers (and, in the case of our currentMessrs. Rufrano and former chief executive officers,Ezzell, as directors) of other externally managed companies sponsored by Cole Capital during the fiscal year ended December 31, 2014.Capital. Like us, such companies do not have a standing compensation committee and they do not separately compensate their executive officers. During the fiscal year ended December 31, 2014,2015, our former chief executive officer, Christopher H. Cole,Glenn J. Rufrano, served as the chief executive officer and a director of Cole Real Estate Investments, Inc.,VEREIT; however he did not serve on that company’s compensation committee; and our former chief executive officer, Nicholas S. Schorsch, the successor to Mr. Cole, served as the chief executive officer and a director of American Realty Capital Properties, Inc., however he did not serve on that company’s compensation committee.12onupon a review of the copies of any such forms furnished to us during and with respect to the fiscal year ended December 31, 20142015 or written representations that no additional forms were required,from our executive officers and directors, to the best of our knowledge, Christopher H. Cole did not file a Form 3 related to his beneficial ownership of more than 10% of our outstanding shares of common stock at such time that our shares of common stock became registered pursuant to the Exchange Act during the year ended December 31, 2014; however, during the year ended December 31, 2014, Mr. Cole ceased to be the beneficial owner of more than 10% of our outstanding shares of common stock. We are not aware of any otherall required Section 16(a) filings that were not timely and correctly made by reporting persons during the year ended December 31, 2014.Michael T. Ezzell,Glenn J. Rufrano, the following individual currently serves as an executive officer of the Company:37,38, has served as our chief financial officer and treasurer since September 2014 and as chief financial officer and treasurer of Cole Income NAV Strategy Advisors since September 2014. Mr. Misselbrook also served as our principal accounting officer from November 2011 until March 2015 and as our senior vice president of accounting and principal accounting officer from March 2012 to March 2015,September 2014 and as our vice president of accounting and principal accounting officer from November 2011 to March 2012. Mr. Misselbrook also serves or served in the following positions for certain other programs sponsored by Cole Capital and certain affiliates of Cole Capital:Entity Position(s) DatesPosition(s) Dates Cole Credit Property Trust, Inc. March 2012 –— May 2014 November 2010 –— March 2012 November 2010 –— March 2012
Investments, Inc. March 2012 –— February 2014(formerly Cole CreditProperty Trust III, Inc.) November 2010 –— March 2012
Trust IV, Inc. Chief financial officer and treasurer September 2014 –— Present March 2012 –— March 2014 May 2011 –— March 2012 Chief financial officer and treasurer September 2014 –— PresentCole Corporate Income Trust, Inc. CCIT II, CCIT II Advisors Chief financial officer and treasurer November 2014 – January 2015CCIT IIChief financial officer and treasurerNovember 2014 –— PresentII AdvisorsChief financial officer and treasurerNovember 2014 – PresentCCPT IV Advisors, CCPT V AdvisorsChief financial officer and treasurerSeptember 2014 – PresentCole Corporate Income Advisors Chief financial officer and treasurer October 2014 –— January 2015Cole Capital Partners, Cole Capital AdvisorsChief financial officer and treasurer – managed REITs June 2015 — Present Chief financial officer and treasurer December 2014 –— June 2015Cole Capital Partners, LLC Chief financial officer and treasurer December 2014 — Present 13American Realty Capital Properties, Inc. (“ARCP”).VEREIT. Mr. Misselbrook has worked in the real estate industry for more than 13 years, nine of which were specific to the REIT industry. Prior to joining Cole Capital and its affiliates in April 2007, he held the position of audit manager at Deloitte & Touche LLP (“Deloitte & Touche”) in Los Angeles in the real estate group serving multiple clients including the world’s largest commercial real estate services firm, where he was the global engagement manager. Mr. Misselbrook earned his bachelor’s degree in accounting and tax, as well as a master’s degree in accounting science, from the University of South Africa. He is a Certified Public Accountant (licensed in the state of California), a Chartered Accountant (licensed in South Africa) and a member of the American Institute of Certified Public Accountants. He is an active participant in the REIT industry and participates in the Investment Program Association’s Non-Traded REIT Financial Standards Sub-Committee.officer.14April 10, 2015March 31, 2016 regarding the beneficial ownership of our common stock by each person known by us to own 5% or more of the outstanding shares of common stock, each of our directors, and each named executive officer, and our directors and executive officers as a group. The percentage of beneficial ownership is calculated based on 7,392,30211,407,488 shares of common stock outstanding as of April 10, 2015.March 31, 2016. None of the shares in the following table has been pledged as security.Name of Beneficial Owner(1)Number of Shares ofCommon Stock BeneficiallyOwned(2)PercentageMichael T. Ezzell— — Name of Beneficial Owner (1) Number of
Shares of
Common
Stock
Beneficially
Owned (2)Percentage T. Patrick DuncanGlenn J. Rufrano — — — — — — — — — — (6(5 persons) — — CHC Investments, LLC (3)P.O. Box 27943Scottsdale, AZ 85255453,050 Wrap Class Shares6.1% (1) With the exception of CHC Investments, LLC, theThe address of each beneficial owner listed is c/o Cole Real Estate Income Strategy (Daily NAV), Inc., 2325 East Camelback Road, Suite 1100, Phoenix, Arizona 85016.(2) Beneficial ownership is determined in accordance with the rules of the SEC and generally includes voting or investment power with respect to securities and shares issuable pursuant to options, warrants and similar rights held by the respective person or group which may be exercised within 60 days following April 10, 2015. Except as otherwise indicated by footnote, and subject to community property laws where applicable, the persons named in the table above have sole voting and investment power with respect to all shares of common stock shown as beneficially owned by them.March 31, 2016.(3)CHC Investments, LLC is wholly-owned by Christopher H. Cole, our former chief executive officer, president and chairman of our board of directors.15 AUDITORS AND AUDIT COMMITTEEDuring the year ended December 31, 2014, Deloitte & Touche served as our independent auditors and provided certain tax and other services. Deloitte & Touche has served as our independent auditors since we commenced principle operations in March 2014. Deloitte & Touche representatives will be present at the 2015 Annual Meeting of Stockholders and will have the opportunity to make a statement if they desire to do so. In addition, the Deloitte & Touche representatives will be available to respond to appropriate questions posed by any stockholders. & Touche as our independent auditorsregistered public accounting firm to audit our financial statements for the year ending December 31, 2015. The2016. Deloitte has served as our independent registered public accounting firm since our formation in July 2010. Stockholder ratification of the appointment of Deloitte as the Company’s independent registered public accounting firm is not required by the Company’s bylaws or otherwise. However, the board of directors is submitting the appointment of Deloitte to the stockholders for ratification as a matter of good corporate practice. If the stockholders fail to ratify the appointment, the audit committee reservesmay reconsider whether or not to retain Deloitte in the right, however, to select new auditorsfuture. Even if the appointment is ratified, the audit committee in its discretion may direct the appointment of a different independent registered public accounting firm at any time induring the future in its discretionyear if it deemsthe audit committee determines that such decision toa change would be in the best interests of the CompanyCompany.its stockholders. Any such decision would be disclosed to the stockholders in accordance with applicable securities laws.& Touche, as well as the fees charged by Deloitte & Touche for such services. In its review of the non-audit services and fees, the audit committee considered whether the provision of such services is compatible with maintaining the independence of Deloitte & Touche.Deloitte. The aggregate fees billed to us for professional accounting services, including the audit of the Company’s annual financial statements by Deloitte & Touche for the years ended December 31, 20142015 and 2013,2014, are set forth in the table below. Year Ended
December 31,
2014 Year Ended
December 31,
2013 $ 358,160 $ 329,235 — — 39,725 13,550 — — $ 397,885 $ 342,785 For purposes of the preceding table, Deloitte & Touche’s professional fees are classified as follows:Audit fees – These are Year Ended December 31, Type of Service 2015 2014 $ 548,430 $ 358,160 Audit-related fees — — 82,693 39,725 All other fees — — Total $ 631,123 $ 397,885 (1) Represents fees for professional services performed for the audit of our annual financial statements and the required review of quarterly financial statements and other procedures performed by Deloitte in order for them to be able to form an opinion on our consolidated financial statements. These fees also cover services that are normally provided by independent auditors in connection with statutory and regulatory filings or engagements and other services that generally only the independent auditor reasonably can provide, such as services associated with filing registration statements, periodic reports and other filings with the SEC, audits of acquired properties or businesses, property audits required by loan agreements, and statutory audits for our subsidiaries or affiliates. (2) Represents fees for all professional services performed by professional staff in our independent auditor’s tax division, except those services related to the audit of our financial statements. These include fees for tax compliance, tax planning, and tax advice, including federal, state and local issues. Services may also include assistance with tax audits and appeals before the IRS and similar state and local agencies, as well as federal, state, and local tax issues related to due diligence. the required review of quarterly financial statements and other procedures performed by Deloitte & Touche in order for them to be able to form an opinion on our consolidated financial statements. These fees also cover services that are normally provided by independent auditors in connection with statutory and regulatory filings or engagements and other services that generally only the independent auditor reasonably can provide, such as services associated with filing registration statements, periodic reports and other filings with the SEC, audits of acquired properties or businesses, property audits required by loan agreements, and statutory audits for our subsidiaries or affiliates.ProceduresAudit-related fees – These are fees for assurance and related services that traditionally are performed by independent auditors, such as due diligence related to acquisitions and dispositions, attestation services that are not required by statute or regulation, statutory subsidiary or equity investment audits incremental to the audit of the consolidated financial statements and general assistance with the implementation of Section 404 of the Sarbanes-Oxley Act of 2002 and other SEC rules promulgated pursuant to the Sarbanes-Oxley Act of 2002.Tax fees – These are fees for all professional services performed by professional staff in our independent auditor’s tax division, except those services related to the audit of our financial statements. These include fees for tax compliance, tax planning, and tax advice, including federal, state and local issues. Services may also include assistance with tax audits and appeals before the IRS and similar state and local agencies, as well as federal, state, and local tax issues related to due diligence.16All other fees – These are fees for other permissible work performed that do not meet the above-described categories, including assistance with internal audit plans and risk assessments.Pre-Approval PoliciesDeloitte & Touche.the independent auditors. All amounts, other than de minimis amounts not subject to pre-approval, specifically pre-approved by the chairman of the audit committee in accordance with this policy, are to be disclosed to the full audit committee at the next regularly scheduled meeting. & Touche for the years ended December 31, 20142015 and 20132014 were pre-approved in accordance with the policies and procedures described above.ReportAudit CommitteePursuantvotes cast at the annual meeting is required to ratify the audit committee charter adopted byappointment of Deloitte as our board of directors, the audit committee’s primary function is to assist the board of directors in fulfilling its oversight responsibilities by overseeing the independent auditors and reviewing the financial information to be provided to the stockholders and others, the system of internal control over financial reporting that management has established and the audit and financial-reporting process. The audit committee is composed of two independent directors. registered public accounting firm.financial statementsCompany’s accounting and thefinancial reporting process, including the system of internal control over financial reporting. Membership onreporting, and the preparation of the Company’s financial statements. Deloitte, the Company’s independent registered public accounting firm, is responsible for performing an audit committee does not callof our consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board (“PCAOB”) and for expressing an opinion as to whether the professional training and technical skillsCompany’s consolidated financial statements are fairly presented in all material respects in conformity with accounting principles generally associated with career professionalsaccepted in the fieldUnited States of accounting and auditing, andAmerica (“GAAP”). In this context, the membersresponsibility of the audit committee are not professionally engaged inis to oversee the practice ofCompany’s accounting or auditing. The audit committee’s role does not provide any special assurance with regard toand financial reporting processes and the financial statementsaudits of the Company, nor does it involve a professional evaluationCompany’s consolidated financial statements. the quality of the audits performed by the independent auditors. The audit committee relies in part, without independent verification, on information provided to it and on representations made by management and the independent auditors that the financial statements have been prepared in conformity with U.S. generally accepted accounting principles.In this context, in fulfilling its oversight responsibilities,function, the audit committee reviewed and discussed with management and Deloitte the 2014Company’s 2015 audited financial statements, and management and Deloitte represented to the audit committee that such audited financial statements were prepared in accordance with management, including a discussion of the quality and acceptability of the financial reporting and controls of the Company.& Touche, which is responsible for expressing an opinion on the conformity of those audited financial statements with U.S. generally accepted accounting principles, the matters required to be discussed by Auditing StandardsStandard No. 16,Communications with Audit Committees, and17their judgments as to the quality and the acceptability of the financial statements and such other matters as are required to be discussedadopted by the applicable auditing standards as periodically amended (including significant accounting policies, alternative accounting treatments and estimates, judgments and uncertainties).PCAOB. In addition, the audit committee has received from Deloitte the written disclosures fromand the independent registered public accounting firmletter required by Public Company Accounting Oversight Board (United States) (“PCAOB”) Ethics and Independence Rule 3526, “Communicationapplicable requirements of the PCAOB regarding Deloitte’s communications with Audit Committees Concerning Independence”the audit committee concerning independence, and discussed with the independent registered public accounting firmDeloitte its independence within the meaning of the rules and standards of the PCAOB and the securities laws and regulations administered by the SEC.independence. & Touche the overall scope and plans for the audit. The audit committee meets periodically with Deloitte, & Touche, with and without management present, to discuss the results of their examinations, their evaluations of internal controls and the overall quality of the financial reporting of the Company.In reliance20142015 audited financial statements of the Company be included in its Annual Report on Form 10-K for the year ended December 31, 20142015 for filing with the SEC.March 24, 2015 182014.2015. Set forth below is a description of the transactions with affiliates. We believe that we have executed all of the transactions set forth below on terms that are fair and reasonable to the Company and on terms no less favorable to us than those available from unaffiliated third parties.20142015 totaled $926,000.$1.3 million. We also reimburse Cole Income NAV Strategy Advisors for expenses incurred in connection with the provision of advisory services; provided, however, that Cole Income NAV Strategy Advisors agreed to waive its right to such expense reimbursement from January 1, 20142015 through December 31, 2014.2015. In addition, we reimburse Cole Income NAV Strategy Advisors for acquisition expenses incurred in connection with the acquisition of our investments. Such payments for the year ended December 31, 20142015 totaled $490,000.$369,000. Furthermore, we reimburse the expenses incurred by Cole Income NAV Strategy Advisors in connection with its provision of administrative services to us, including related personnel costs, subject to the limitation that we do not reimburse Cole Income NAV Strategy Advisors for any amount by which the operating expenses (which exclude, among other things, the expenses of raising capital, interest payments, taxes, non-cash items such as depreciation, amortization and bad debt reserves, and acquisition fees and acquisition expenses) at the end of the four preceding fiscal quarters exceed the greater of (i) 2.0% of average invested assets, or (ii) 25.0% of net income other than any additions to reserves for depreciation, bad debt or other similar non-cash reserves and excluding any gain from the sale of assets for that period; provided, however, that Cole Income NAV Strategy Advisors agreed to waive its right to such expense reimbursement from January 1, 20142015 through December 31, 2014.20142015 totaled $1.1$1.2 million.2014,2015, we incurred $520,000$464,000 of organization and offering expense reimbursements payable to Cole Income NAV Strategy Advisors.19one-year term expiring November 30, 2015,2016, subject to an unlimited number of successive one-year renewals upon mutual consent of the parties. Our independent directors are required to determine, at least annually, that the compensation to Cole Income NAV Strategy Advisors is reasonable in relation to the nature and quality of services performed and the investment performance of the Company and that such compensation is within the limits set forth in our Charter.Michael T. Ezzell,chairmanone of our board of directors, is the chief executive officer and president of Cole Income NAV Strategy Advisors. Simon J. Misselbrook, our chief financial officer and treasurer, is the chief financial officer and treasurer of Cole Income NAV Strategy Advisors.On February 7, 2014, ARCP acquired our sponsor pursuant to a transaction whereby Cole Real Estate Investments, Inc. merged with and into Clark Acquisition, LLC, a wholly owned subsidiary of ARCP (“Merger Sub”), with Merger Sub surviving as a wholly owned subsidiary of ARCP (the “ARCP Merger”). ARCP is a self-managed publicly traded Maryland corporation listed on The NASDAQ Global Select Market, focused on acquiring and owning single tenant freestanding commercial properties subject to net leases with high credit quality tenants. Mr. Schorsch, our former chief executive officer, president and chairman of our board of directors, was the chairman and chief executive officer of ARCP at the time of the ARCP Merger.As a result of the ARCP Merger, ARCP indirectly owns and/or controls Cole Income NAV Strategy Advisors, Cole Capital Corporation, CREI Advisors, LLC, and our sponsor.aton the date at which, in the aggregate, underwriting compensation from all sources, including the selling commission, dealer manager fee, distribution fee and other underwritingcompensation paid by us and by Cole Income NAV Strategy Advisors and its affiliates, equals 10% of the gross proceeds from our primary offering (i.e., excluding proceeds from sales pursuant to our distribution reinvestment plan), calculated as of the same date that we calculate the aggregate dealer manager fee.underwriting compensation. For the year ended December 31, 2014,2015, we paid to Cole Capital Corporation commissions and dealer manager fees totaling $1.2 million, of which $647,000$477,000 was reallowed to participating broker-dealers.Michael T. Ezzell,chairmanone of our board of directors, also is the president and treasurer and sole director of Cole Capital Corporation. Christopher H. Cole and Nicholas S. Schorsch,Michael T. Ezzell, our former executive officersofficer and directors, were eachdirector, was the sole director and president and treasurer of Cole Capital Corporation before theirhis resignations from that position.On16,31, 2014, the Company entered into a $20.0 million unsecured revolving line of credit with Series C, LLC, an affiliate of the Company’s advisor (“Series C Loan”). The Series C Loan bears interest at a rate per annum equal to the one-month LIBOR plus 2.45% with accrued interest payable monthly in arrears and principal due upon maturity, which matured on December 15, 2015. The Series C Loan had an interest rate of 2.61% as of20December 31, 2014. InNo amounts were drawn by the eventCompany under the Series C Loan is not paid off on the maturity date, the loan includes default provisions. The Series C Loan has been approved by a majority of the Company’s board of directors (including a majority of the independent directors) not otherwise interested in the transaction as fair, competitive and commercially reasonable and no less favorableprior to the Company than a comparable loan between unaffiliated parties under the same circumstances. As of December 31, 2014, the Company had $20.0 million available for borrowing.Cole Income NAV Strategy Advisorsour advisor and its affiliates and the allocation of investment opportunities among ARCPVEREIT and Cole Capital-sponsored programs. These restrictionsConflict resolution provisions in our charter and in policies regarding the allocation of investment opportunities adopted by the Cole Capital sponsored programs include, among others, the following:We will not purchase or lease properties from our sponsor, our advisor, any of our directors or any of their respective affiliates, unless (1) a majority of the directors, including a majority of the independent directors, who are not otherwise interested in such transaction determines that such transaction is fair and reasonable to us, and (2) either (A) the purchase price is no greater than the cost of the property to the seller, including acquisition-related expenses, or (B) a majority of the independent directors determines that there is substantial justification for any amount above such cost and that the difference is reasonable. In no event will we acquire any property from an affiliate at an amount in excess of its current appraised value as determined by an independent appraiser.We will not sell or lease properties to our sponsor, our advisor, any of our directors or any of their respective affiliates, unless (1) a majority of the directors, including a majority of the independent directors, who are not otherwise interested in such transaction determines that such transaction is fair and reasonable to us and on terms and conditions not less favorable to us than those available from unaffiliated third parties, and (2) either (A) the sale is greater than the cost of the property to us, including acquisition-related expenses, or (B) a majority of the independent directors determines that there is substantial justification for any amount below such cost, and that the difference is reasonable. In no event will we sell any property to an affiliate at an amount less than its current appraised value as determined by an independent appraiser.Our sponsor, our advisor, any of our directors and any of their respective affiliates will not make loans to us, except that we may borrow funds from affiliates of our advisor, including our sponsor, (A) as bridge financing to enable us to acquire a property or (B) for the purpose of providing short term financing as necessary to satisfy valid redemption requests under the Company’s share redemption plan, in either case when offering proceeds alone are insufficient to do so and third party financing has not been arranged or is insufficient. Any and all such transactions must be approved by a majority of our directors, including a majority of our independent directors, who are not otherwise interested in such transactions as being fair and reasonable to us.• We will not purchase or lease properties from our sponsor, our advisor, any of our directors or any of their respective affiliates, unless (1) a majority of the directors, including a majority of the independent directors, who are not otherwise interested in such transaction determines that such transaction is fair and reasonable to us, and (2) either (A) the purchase price is no greater than the cost of the property to the seller, including acquisition-related expenses, or (B) a majority of the independent directors determines that there is substantial justification for any amount above such cost and that the difference is reasonable. In no event will we acquire any property from an affiliate at an amount in excess of its current appraised value as determined by an independent appraiser. In the event that an investment opportunity becomes available that may be suitable for both us and ARCP or one or more other real estate programs sponsored by Cole Capital, and for which more than one of such entities has sufficient uninvested funds, then our advisor and the advisors of the other programs, with oversight by their respective boards of directors, will examine the following factors, among others, in determining the entity for which the investment opportunity is most appropriate:the investment objective of each entity;the anticipated operating cash flows of each entity and the cash requirements of each entity;the effect of the acquisition on diversification of each entity’s investments by type of property, geographic area and tenant concentration;the amount of funds available to each program and the length of time such funds have been available for investment;21• We will not sell or lease properties to our sponsor, our advisor, any of our directors or any of their respective affiliates, unless (1) a majority of the directors, including a majority of the independent directors, who are not otherwise interested in such transaction determines that such transaction is fair and reasonable to us and on terms and conditions not less favorable to us than those available from unaffiliated third parties, and (2) either (A) the sale is greater than the cost of the property to us, including acquisition-related expenses, or (B) a majority of the independent directors determines that there is substantial justification for any amount below such cost, and that the difference is reasonable. In no event will we sell any property to an affiliate at an amount less than its current appraised value as determined by an independent appraiser. • Our sponsor, our advisor, any of our directors and any of their respective affiliates will not make loans to us, except that we may borrow funds from affiliates of our advisor, including our sponsor, (A) as bridge financing to enable us to acquire a property or (B) for the purpose of providing short term financing as necessary to satisfy valid redemption requests under the Company’s share redemption plan, in either case when offering proceeds alone are insufficient to do so and third party financing has not been arranged or is insufficient. Any and all such transactions must be approved by a majority of our directors, including a majority of our independent directors, who are not otherwise interested in such transactions as being fair and reasonable to us. • Property acquisitions are allocated among VEREIT and the real estate programs sponsored by Cole Capital pursuant to an asset allocation policy. In the event that an investment opportunity becomes available that may be suitable for both us and VEREIT or one or more other real estate programs sponsored by Cole Capital, and for which more than one of such entities has sufficient uninvested funds, then our advisor and the advisors of the other programs, with oversight by their respective boards of directors, will examine the following factors, among others, in determining the entity for which the investment opportunity is most appropriate: • the investment objective of each entity; • the anticipated operating cash flows of each entity and the cash requirements of each entity; • the effect of the acquisition on diversification of each entity’s investments by type of property, geographic area and tenant concentration; • the amount of funds available to each program and the length of time such funds have been available for investment; • the policy of each entity relating to leverage of properties; • the income tax effects of the purchase to each entity; and • the size of the investment. the policy of each entity relating to leverage of properties;the income tax effects of the purchase to each entity; andthe size of the investment.If, in the judgment of the advisors, the investment opportunity may be equally appropriate for more than one program, then the entity that has had the longest period of time elapse since it was allocated an investment opportunity of a similar size and type (e.g., office, industrial or single-tenant or multi-tenant retail) will first be offered such investment opportunity.If a subsequent development, such as a delay in the closing of the acquisition or a delay in the construction of a property, causes any such investment, in the opinion of the advisors, to be more appropriate for an entity other than the entity that committed to make the investment, the advisors may determine that ARCP or another program sponsored by Cole Capital will make the investment. Our board of directors, including the independent directors, oversees the allocation process to ensure that the method used for the allocation of the acquisition of properties by ARCP or two or more programs sponsored by Cole Capital seeking to acquire similar types of properties is applied fairly to us.20162017 Annual Meeting of Stockholders, including any proposals for nominees for election as director at the 20162017 Annual Meeting of Stockholders, must be received by our secretary, Michael J. Komenda, at our offices no later than December 22, 2015,14, 2016, and must comply with the requirements of Rule 14a-8 under the Securities Exchange Act of 1934, as amended. If a stockholder wishes to present a proposal at the 20162017 Annual Meeting of Stockholders, whether or not the proposal is intended to be included in the 20162017 proxy materials, our bylaws currently require that the stockholder give advance written notice to our secretary, Michael J. Komenda, at our offices no earlier than November 22, 201514, 2016 and no later than December 22, 2015.14, 2016. Stockholders are advised to review the Company’s bylaws, which contain other requirements with respect to advance notice of stockholder proposals and director nominations.20152016 Annual Meeting of Stockholders other than the matters referred to above. If any other matter is properly brought before the meeting for action by stockholders, proxies in the enclosed form returned to us will be voted in accordance with the recommendation of the board of directors or, in the absence of such a recommendation, in accordance with the discretion of the proxy holders.20142015 annual report to stockholders, filed with the SEC, is enclosed herewith. You may also obtain our other SEC filings and certain other information concerning the Company through the Internet atwww.sec.gov andwww.colecapital.com. Information contained in any website referenced in this proxy statement is not incorporated by reference in this proxy statement.By Order of the Board of Directors Michael J. KomendaSecretary22If Voting by MailRemember tosignanddateballot below.Please ensure the address to the right shows through thePROXY TABULATORP.O. BOX 55909BOSTON, MA 02205-9100uwindow of the enclosed postage paid return envelope.
COLE REAL ESTATE INCOME STRATEGY (DAILY NAV), INC.PROXY FOR THE ANNUAL MEETING OF STOCKHOLDERS TO BE HELD JUNE 2, 2015THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS.undersigned stockholder hereby appoints Simon J. Misselbrookterm “Independent Director” shall mean a Director who is not on the date of determination, and Michael J. Komenda, each as proxy and attorney-in-fact,within the last two years from the date of determination has not been, directly or indirectly associated with full powerthe Sponsor or the Advisor by virtue of substitution as determined(i) ownership of an interest in the Sponsor, the Advisor or any of their Affiliates, (ii) employment by the BoardSponsor, the Advisor or any of Directors of Cole Real Estate Income Strategy (Daily NAV), Inc., on behalf and in the nametheir Affiliates, (iii) service as an officer or director of the undersigned, to attendSponsor, the Annual MeetingAdvisor or any of Stockholderstheir Affiliates, (iv) performance of COLE REAL ESTATE INCOME STRATEGY (DAILY NAV), INC. to be held at 9:00 a.m. local time on June 2, 2015, at our offices located at 2325 E. Camelback Road, Suite 1100, Phoenix, Arizona 85016,services, other than as a Director, for the Corporation, (v) service as a director or trustee of more than three REITs organized by the Sponsor or advised by the Advisor or (vi) maintenance of a material business or professional relationship with the Sponsor, the Advisor or any of their Affiliates. A business or professional relationship is considered “material” if the aggregate gross income derived by the Director from the Sponsor, the Advisor and any adjournments or postponements thereof, and to cast on behalftheir Affiliates exceeds five percent of either the Director’s annual gross income during either of the undersigned all votes whichlast two years or the undersigned would be entitled to cast if personally present, as indicatedDirector’s net worth on the reverse side of this ballot, and otherwise to represent the undersigned at the meeting and any adjournments or postponements thereof, with all powers possessed by the undersigned if personally present. The undersigned acknowledges receipt of the notice of Annual Meeting of Stockholders, the proxy statement and the annual report.When this proxy is properly executed, the votes entitled to be cast by the undersigned stockholder will be cast in the manner directed herein. If no direction is made, the votes entitled to be cast by the undersigned stockholder will be cast “FOR ALL” of the nominees for director listed in Proposal 1. The proxies are authorized to vote upon such other matters as may properly come before the meeting or any adjournments or postponements thereof in accordancea fair market value basis. An indirect association with the recommendationSponsor or the Advisor shall include circumstances in which a Director’s spouse, parent, child, sibling, mother- or father-in-law, son- or daughter-in-law or brother- or sister-in-law is or has been associated with the Sponsor, the Advisor, any of their Affiliates or the Board of Directors or, in the absence of such a recommendation, in their discretion, including, but not limited to, the power and authority to adjourn or postpone the meeting to provide more time to solicit proxies for any or all of the proposals referenced herein.Corporation.Important Notice Regarding the Availability of Proxy Materials for the Cole Real Estate Income Strategy (Daily NAV), Inc. Annual Meeting of Stockholders to Be Held on June 2, 2015. The Annual Report and Proxy Statement for this meeting are available at:http://www.2voteproxy.com/colecapital.
Note:Signature(s) should agree with the name(s) printed herein. When signing as attorney, executor, administrator, trustee or guardian, please give your full name as such. If a corporation, please sign in full corporate name by president or other authorized officer. If a partnership, please sign in partnership name by authorized person.uSignature(s)Date:THIS PROXY WILL BE VOTED “FOR ALL” OF THE NOMINEES FOR DIRECTOR LISTED IN PROPOSAL 1 IF NO SPECIFICATION IS MADE BELOW. AS TO ANY OTHER MATTER THAT MAY PROPERLY COME BEFORE THE MEETING OR ANY ADJOURNMENT OR POSTPONEMENT THEREOF, THE PROXY OR PROXIES WILL VOTE IN ACCORDANCE WITH THE RECOMMENDATION OF THE BOARD OF DIRECTORS OR, IN THE ABSENCE OF SUCH A RECOMMENDATION, IN THEIR DISCRETION.The Board of Directors recommends that you vote FOR ALL nominees for director in Proposal 1:Proposal 1. Election of DirectorsFORALLWITHHOLDALLFOR ALLEXCEPT*(1) Michael T. Ezzell (2) T. Patrick Duncan (3) George N. Fugelsang(4) Richard J. Lehmann (5) Roger D. Snell¨¨¨* To Withhold authority to vote for any individual nominee(s) write the number(s) of the nominee(s) in the box below.
