INDEPENDENCE REALTY TRUST, INC.

Current report

Risks Relating to the Mergers

Current report

The Mergers may not be consummated on the terms or timeline currently contemplated, or at all. Consummation of the Mergers is subject to many conditions and if these conditions are not satisfied or waived, the Mergers will not be consummated, which could adversely affect the business of IRT and, in certain circumstances, result in IRT being required to pay a termination fee to CSR.

Current report

Consummation of the Mergers is subject to certain conditions, including: (1) the receipt of required approvals from IRT’s stockholders and from CSR’s shareholders; (2) approval for listing on the New York Stock Exchange (the “NYSE”), subject to official notice of issuance, of the shares of IRT Common Stock to be issued in the Mergers, including shares of IRT Common Stock issuable upon conversion of IROP Common Units, IROP Series A Preferred Units and IROP Series B Preferred Units issued in the Partnership Merger; (3) the absence of a court order or other legal restraint preventing the consummation of the Mergers; (4) accuracy of each party’s representations and warranties, subject in most cases to materiality or material adverse effect qualifications; (5) material compliance with each party’s covenants; (6) receipt by CSR of an opinion to the effect that the Company Merger will qualify as a “reorganization” within the meaning of Section 368(a) of the Internal Revenue Code of 1986, as amended (the “Code”); (7) receipt by IRT of an opinion of counsel to CSR that CSR qualifies as a REIT under the Code, and receipt by CSR of an opinion of counsel to IRT that IRT qualifies as a REIT under the Code; and (8) the absence of any continuing material adverse effect on CSR or IRT since the date of the Merger Agreement.

Current report

IRT cannot provide assurance that the conditions to consummation of the Mergers will be satisfied or waived, and accordingly, that the Mergers will be consummated on the terms or timeline that the parties anticipate, or at all. IRT or CSR may terminate the Merger Agreement under certain circumstances, including, among other reasons, if the Mergers are not consummated on or before June 30, 2027.

Current report

Failure to consummate the Mergers may adversely affect IRT’s results of operations, financial condition and business prospects for many reasons, including, among others:

Current report

The Exchange Ratio will not be adjusted in the event of any change in the price of IRT Common Stock or in the relative values of IRT and CSR.

Current report

At the Company Merger Effective Time, each issued and outstanding share of CSR Common Stock (other than certain shares set forth in the Merger Agreement) will be automatically converted into the right to receive newly issued shares of IRT Common Stock equal to the Exchange Ratio, with cash paid in lieu of fractional shares. At the Partnership Merger Effective Time, each issued and outstanding common unit of CSR OP will be automatically converted into the right to receive a number of IROP Common Units equal to the Exchange Ratio, rounded up to the nearest whole unit (for each holder of common units of CSR OP, after aggregation of all fractional IROP Common Units otherwise to be received by such holder). The Exchange Ratio will not be adjusted for changes in the market price of IRT Common Stock or in the relative values of IRT and CSR. It may be adjusted for stock splits, reverse stock splits, combinations, subdivisions or reclassifications of IRT Common Stock and CSR Common Stock and for cash dividends or other cash distributions reasonably determined in good faith to be necessary to maintain IRT’s or CSR’s qualification as a REIT or to avoid the incurrence of income or excise taxes (“REIT Dividends”) declared before the closing date of the Mergers, as provided in the Merger Agreement. The price of IRT Common Stock at the closing of the Mergers may vary from its price on September 8, 2026, the date the Original Merger Agreement was executed. Changes in the price of IRT Common Stock prior to consummation of the Mergers will affect the market value of the merger consideration, which may be more or less than the fair value of CSR’s net assets on the closing date of the Mergers. Changes in IRT Common Stock price may result from a variety of factors (many of which are beyond the control of IRT), including the following factors:

Current report

The pendency of the Mergers could adversely affect the business and operations of IRT and CSR.

Current report

In connection with the pending Mergers, current and prospective employees of IRT and CSR may experience uncertainty about their future roles with IRT following the Mergers, which may materially adversely affect the ability of each of IRT and CSR to attract and retain key personnel during the pendency of the Mergers. If IRT is unable to retain personnel who are critical to the future operations of the companies, IRT could face disruptions in its operations, loss of existing residents, loss of key information, expertise or know-how and unanticipated additional recruitment and training costs. In addition, the loss of key IRT and CSR personnel could diminish the anticipated benefits of the Mergers. No assurance can be given that the combined company will be able to retain or attract employees to the same extent that IRT and CSR have previously been able to retain or attract their own employees. In addition, due to operating covenants in the Merger Agreement, IRT may be unable (without the other party’s prior written consent), during the pendency of the Mergers, to pursue strategic transactions, undertake significant capital projects, undertake certain significant financing transactions and otherwise pursue other actions, even if such actions would prove beneficial. Similarly, some current or prospective operators or vendors of each of IRT and CSR may delay or defer decisions, which could adversely affect the revenues, earnings, funds from operations, cash flows and expenses of IRT and CSR, regardless of whether the Mergers are consummated.

Current report

IRT stockholders will be diluted by the Mergers.

Current report

The Mergers will dilute the ownership position of IRT stockholders. IRT may also issue additional shares of common stock or preferred stock in the future and IROP may issue additional units of limited partnership in the future and such issuances would create further dilution. Consequently, IRT stockholders, as a general matter, will have less influence over the management and policies of IRT after consummation of the Mergers than they currently exercise.

Current report

Management’s attention may be diverted from ongoing business operations and opportunities during the pendency of the Mergers.

Current report

The Mergers may divert management’s attention from ongoing business operations and opportunities. Completion of the Mergers will require a significant amount of time and focus from the management teams of IRT, which may divert attention from day-to-day operations and the execution of other strategic initiatives. The diversion of management’s attention and any difficulties encountered in the transition and integration process could adversely affect the business, financial results and stock price of IRT.

Current report

The Mergers and related transactions are subject to approval by stockholders of both IRT and CSR.

Current report

In order for the Mergers to be consummated, CSR shareholders must approve the Company Merger, which requires the affirmative vote of the holders of at least a majority of the outstanding shares of CSR Common Stock entitled to vote on such proposal. In addition, IRT stockholders must approve the issuance of IRT Common Stock by the affirmative vote of at least a majority of the votes cast on such proposal. This approval by IRT stockholders is required under applicable NYSE rules.

Current report

The Merger Agreement contains provisions that could discourage a potential competing acquiror of CSR or could result in any competing proposal being at a lower price than it might otherwise be.

Current report

The Merger Agreement contains provisions that, subject to limited exceptions, restrict CSR from soliciting, initiating, knowingly encouraging or facilitating competing third-party proposals to effect, among other things, a merger, reorganization, share sale, share exchange, asset sale, consolidation, business combination, recapitalization, liquidation, dissolution or similar transaction involving any purchase or sale of 20% or more of the consolidated assets of CSR or 20% or more of the outstanding CSR Common Stock, and contains mirrored restrictions applicable to IRT with respect to competing proposals involving IRT. IRT generally has an opportunity to offer to modify the terms of the Merger Agreement in response to any competing acquisition proposal before the board of trustees of CSR may withdraw or modify its recommendation or terminate the Merger Agreement to enter into such a competing acquisition proposal, and CSR has a mirrored opportunity with respect to any competing proposal involving IRT (except that IRT may not terminate the Merger Agreement to accept a competing acquisition proposal). In some circumstances, on termination of the Merger Agreement, CSR may be required to pay IRT a termination fee of $45.0 million, or IRT may be required to pay CSR a termination fee of $60.0 million.

Current report

These provisions could discourage a potential competing acquiror that might have an interest in acquiring all or a significant part of CSR or IRT from considering or proposing such an acquisition, even if it were prepared to pay or offer consideration with a higher value than the value expected to be received or realized in the Mergers, or might result in a potential competing acquiror proposing to offer less consideration or less favorable terms than it might otherwise have proposed because of the added expense of the termination fee that may become payable in certain circumstances under the Merger Agreement.

Current report

An adverse outcome in any litigation or other legal proceedings relating to the Merger Agreement, or the transactions contemplated thereby, could have a material adverse impact on the businesses of IRT and CSR and their ability to consummate the transactions contemplated by the Merger Agreement.

Current report

Transactions similar to the Mergers are frequently the subject of litigation or other legal proceedings, including actions alleging that either party’s board of directors or board of trustees, as applicable, breached their respective duties by entering into a merger agreement or any other claims (contractual or otherwise) arising out of a merger or the transactions related thereto. If litigation or other legal proceedings are brought against IRT, CSR, the board of directors of IRT, the board of trustees of CSR or their respective subsidiaries in connection with the Merger Agreement, or the transactions contemplated thereby, the respective parties to the proceeding intend to defend against such actions but they might not be successful in doing so. An adverse outcome in such matters, as well as the costs and efforts of a defense even if successful, could have a material adverse effect on IRT’s or CSR’s ability to consummate the Mergers or their respective business, results of operations or financial position, including through the possible diversion of either company’s resources or distraction of key personnel.

Current report

IRT may finance a portion of the transactions contemplated by the Merger Agreement, including the refinancing of indebtedness of CSR and its subsidiaries, and pay related costs, fees and expenses, with the Merger Term Loan.

Current report

IRT may finance a portion of the transactions contemplated by the Merger Agreement, including the refinancing of indebtedness of CSR and its subsidiaries, and pay related costs, fees and expenses, with the Merger Term Loan (as defined below). To this end, IROP entered into a commitment letter, dated as of September 8, 2026 (the “Debt Commitment Letter”), with Royal Bank of Canada, pursuant to which Royal Bank of Canada committed to provide, on the terms and subject to the conditions set forth in the Debt Commitment Letter, on the closing date of the Mergers, up to $716,000,000 under a senior unsecured term loan facility (the “Merger Term Loan”). In the event the Merger Term Loan contemplated by the Debt Commitment Letter is not available on the anticipated terms, there is a risk that other financing may not be available on acceptable terms, in a timely manner or at all.

Current report

Risks Relating to IRT Following Consummation of the Mergers

Current report

IRT expects to incur substantial expenses related to the Mergers and the transactions contemplated by the Merger Agreement.

Current report

IRT expects to incur substantial expenses in consummating the Mergers and integrating the business, operations, networks, systems, technologies, policies and procedures of IRT and CSR. There are a large number of systems that must be integrated or separated in connection with the Mergers, and the other transactions contemplated by the Merger Agreement, including leasing, billing, management information, purchasing, accounting and finance, sales, payroll and benefits, fixed asset, lease administration and regulatory compliance. While IRT has assumed that a certain level of transaction and integration expenses would be incurred, there are a number of factors beyond its control that could affect the total amount or the timing of its integration expenses. Many of the expenses that will be incurred, by their nature, are difficult to estimate accurately at the present time. The expenses in connection with the Mergers and the transactions contemplated by the Merger Agreement are expected to be significant, although the aggregate amount and timing of such charges are uncertain at present.

Current report

Following consummation of the Mergers, IRT may be unable to integrate the business of CSR successfully or realize the anticipated synergies and related benefits of the Mergers and the transactions contemplated by the Merger Agreement or do so within the anticipated time frame.

Current report

The Mergers involve the combination of IRT and CSR, two companies which currently operate as independent companies. In addition, CSR recently completed a series of transactions to provide for the internalization of its previously externalized management functions. IRT will be required to devote significant management attention and resources to integrating their business practices and operations. Potential difficulties that IRT may encounter in the integration process include the following:

Current report

For all these reasons, it is possible that the integration process could result in the distraction of the combined company’s management, the disruption of the combined company’s ongoing business or inconsistencies in the combined company’s services, standards, controls, procedures and policies, any of which could adversely affect the ability of the combined company to maintain relationships with residents, customers, vendors, joint venture partners and employees or to achieve the anticipated benefits of the Mergers, or could otherwise adversely affect the business and financial results of the combined company. Furthermore, while it is anticipated that certain expenses will be incurred to achieve synergies, cost savings and related benefits of the Mergers, such expenses are difficult to estimate accurately, and may exceed current estimates. Accordingly, the benefits expected to be realized from the Mergers may be offset by costs incurred to, or delays in, integrating the businesses of IRT and CSR.

Current report

IRT’s level of indebtedness will increase upon consummation of the Mergers and may increase the related risks IRT now faces.

Current report

Upon consummation of the Mergers, IRT intends to assume and/or refinance certain indebtedness of CSR, CSR OP and their subsidiaries and, as a result, IRT’s consolidated indebtedness will increase and it will be subject to increased risks associated with debt financing, including an increased risk that IRT’s cash flows could be insufficient to meet required payments on its indebtedness or to continue to pay dividends on its common stock. On September 30, 2026, IRT had consolidated indebtedness of approximately $2.401 billion, net of approximately $10.941 million of unamortized deferred financing costs and $15.795 million of loan premiums, net. Taking into account CSR’s consolidated indebtedness of approximately $812.607 million, net of approximately $31.212 million of unamortized deferred financing costs, premiums and discounts, on September 30, 2026, the total consolidated indebtedness of the combined company (excluding fair value adjustments) as of September 30, 2026 would have been approximately $3.214 billion, net of unamortized deferred financing costs, premiums and discounts.

Current report

The combined company’s increased indebtedness could have important consequences to holders of its common stock, including:

Current report

IRT may incur additional indebtedness in the future.

Current report

In connection with executing its business strategy following the Mergers, IRT expects to evaluate the possibility of acquiring additional properties and making strategic investments, and it may elect to finance these transactions by incurring additional indebtedness. The amount of such indebtedness could have material adverse consequences for the combined company following the Mergers, including hindering its ability to adjust to changing market, industry or economic conditions; limiting its ability to access the capital markets to refinance maturing debt or to fund acquisitions; limiting the amount of cash flow available for future operations, acquisitions, dividends, stock repurchases or other uses; making the combined company more vulnerable to economic or industry downturns, including interest rate increases; and placing the combined company at a competitive disadvantage compared to less leveraged competitors.

Current report

Tax protection agreements could limit the combined company’s ability to sell or otherwise dispose of certain properties and are expected to require the combined company to maintain certain debt levels that otherwise would not be required to operate its business.

Current report

In connection with the Mergers, the combined company is expected to succeed to or assume tax protection agreements that provide that if the combined company or IROP sells, exchanges, transfers, conveys or otherwise disposes of certain properties in a taxable transaction for a specified period of time, the combined company or IROP will indemnify certain protected partners against certain tax liabilities attributable to built-in gain that existed with respect to such properties at the time of their acquisition by CSR OP, together with a gross up for tax liabilities incurred as a result of such indemnification payment. Therefore, although it may be in the combined company’s stockholders’ best interest for the combined company to sell one or more of these properties, it may be economically prohibitive for the combined company to do so because of these indemnity obligations. Moreover, the combined company is expected to be required to maintain certain minimum levels of indebtedness, and in certain cases to provide certain protected partners with the opportunity to guarantee qualifying indebtedness, in each case, in order to enable such protected partners to continue to defer certain tax liabilities. These obligations are expected to require the combined company to maintain more or different indebtedness than it would otherwise require for its business. If IROP is unable to maintain the minimum levels or appropriate types of indebtedness required under the tax protection agreements, IRT or IROP may be required to indemnify certain protected partners in amounts determined by reference to the gain recognized by such protected partners as a result of such failure, together with a gross up for tax liabilities incurred as a result of such indemnification payment. As a result, these tax protection agreements may restrict the combined company’s ability to take actions or make decisions that otherwise would be in its best interests, including in connection with any future strategic transaction.

Current report

The Mergers will result in changes to IRT’s board of directors that may affect its strategy and operations.

Current report

Upon consummation of the Mergers, IRT’s board of directors will be comprised of the nine incumbent directors of IRT’s board of directors and two incumbent trustees of CSR’s board of trustees. IRT will cause its board of directors to include two of the individuals then serving as independent members of CSR’s board of trustees, subject to the evaluation and recommendation by the Nominating and Governance Committee of IRT’s board of directors in its sole discretion in accordance with such committee’s charter. Scott F. Schaeffer, currently IRT’s Chairman of the board of directors and Chief Executive Officer, will continue in these positions. This new composition of IRT’s board of directors may affect IRT’s business strategy and operating decisions following consummation of the Mergers. In addition, there can be no assurances that the new board of directors will function effectively as a team and that there will not be any adverse effects on IRT’s business as a result.

Current report

IRT will depend on key personnel for its future success, and the loss of key personnel or inability to attract and retain personnel could harm the combined company’s business.

Current report

The success of the combined company following consummation of the Mergers will depend in part upon its ability to retain key IRT and CSR executives and other employees. Key executives and other employees may depart either before or after consummation of the Mergers because of issues relating to the uncertainty and difficulty of integration or a desire not to remain with the combined company following consummation of the Mergers. Accordingly, no assurance can be given that IRT or, following consummation of the Mergers, the combined company, will be able to retain key executives or other employees to the same extent as in the past.

Current report

The future results of IRT will suffer if IRT does not effectively manage its operations following consummation of the Mergers and the transactions contemplated by the Merger Agreement.