Sunrise Realty Trust, Inc.

Index

There have been no material changes to the risk factors disclosed in Item 1A - “Risk Factors” in the Company’s Annual Report on Form 10-K and as disclosed in Item 1A — “Risk Factors” in the Company’s Quarterly Reports on Form 10-Q, except as set forth below.

Risks Relating to the Proposed Merger with SRT

We may fail to realize all of the expected benefits of the Merger or those benefits may take longer to realize than expected.

The full benefits of the Merger may not be realized by us as expected or may not be achieved within the anticipated time-frame, or at all. Failure to achieve the anticipated benefits of the Merger could adversely affect our results of operations or cash flows, cause dilution to our earnings per share or book value per share, decrease or delay the expected accretive effect of the Merger, and negatively impact the share price of our common stock.

Post-closing, we may be required to devote significant attention and resources to successfully integrate SRT into our existing structure. This integration process may disrupt our business and, if ineffective, would limit the anticipated benefits of the Merger and could adversely affect our business.

We have incurred and will continue to incur direct and indirect costs as a result of the Merger, and we may incur liabilities arising from the Merger Agreement and the Merger.

We have incurred and will continue to incur substantial expenses in connection with and as a result of completing the Merger and, following completion, we may incur additional expenses in connection with combining the businesses, operations, policies and procedures of the two companies. Factors beyond our control could affect the total amount or timing of these expenses, many of which, by their nature, are difficult to estimate accurately.

Although the Merger has been completed, the Company may be subject to liabilities, claims, litigation, demands, purchase price or share issuance disputes, tax claims, third-party consent issues, breaches of representations, warranties or covenants, or other obligations arising from or relating to the Merger Agreement, the completed Merger or related transactions. Any such matters may be costly to defend or resolve, may divert management’s attention and may result in monetary damages, equitable remedies, settlement costs, indemnification payments, additional disclosures, governance changes or other adverse consequences.

If any liabilities, claims, litigation or contractual obligations arising from the Merger and related transactions are material, they could adversely affect the Company’s business, financial condition, results of operations, liquidity, cash flows and market price of its common stock.

The issuance of shares of our common stock in the Merger substantially increased the number of shares outstanding and may dilute existing stockholders or adversely affect the market price of our common stock.

Pursuant to the Merger Agreement, as of November 5, 2026, each outstanding share of common stock of SRT was converted into the right to receive 1.45 shares of the Company’s common stock, and the Company issued 8,464,977 shares of its common stock as Merger consideration, resulting in 21,980,828 shares of the Company’s common stock outstanding as of the Merger Effective Time. The issuance of these shares significantly increased the Company’s outstanding common stock and diluted the ownership and voting interests of the Company’s pre-Merger stockholders.

The additional shares may adversely affect the market price of the Company’s common stock, particularly if former SRT stockholders sell a significant number of shares, if investors expect such sales to occur, or if the market perceives that the Merger will not produce the expected benefits. If the market price of the Company’s common stock declines, the Company’s ability to raise capital on favorable terms, maintain investor confidence or pursue strategic transactions may be adversely affected. The increased number of shares outstanding also may reduce earnings per share, book value per share or other per-share metrics, depending on the Company’s post-Closing results, transaction costs, integration costs and the value of the acquired business. In addition, the issuance of shares to former owners of SRT may affect voting dynamics and governance matters.

We could face adverse tax consequences if SRT failed to qualify as a REIT prior to the Merger.

In connection with the closing of the Merger, we received an opinion of counsel to the effect that SRT qualified as a REIT for U.S. federal income tax purposes through the time of the Merger. However, we did not request a ruling from the IRS

Index

that SRT qualified as a REIT. Notwithstanding the opinion of counsel, if the IRS successfully challenged SRT's REIT status prior to the Merger, we could face adverse tax consequences, including:

•succeeding to SRT's liability for U.S. federal income taxes at regular corporate rates for the periods in which SRT failed to qualify as a REIT (without regard to the deduction for dividends paid for such periods);

•succeeding to any built-in gain on SRT's assets, for which we could be liable for U.S. federal income tax at regular corporate rates, if we were to recognize such gain in the five-year period following the Merger; and

•succeeding to SRT's earnings and profits accumulated during the periods in which SRT failed to qualify as a REIT, which we would be required to distribute to our shareholders in order to satisfy the REIT 90% distribution requirements and avoid the imposition of any excise tax as a result, we would have less cash available for operations and distributions to our shareholders, which could require us to raise capital on unfavorable terms or pay deficiency dividends.

The unaudited pro forma financial information related to the Merger may not be indicative of our actual financial condition or results after the Merger.

The unaudited pro forma condensed combined consolidated financial information filed after the closing of the Merger was prepared for illustrative purposes and was based on assumptions and adjustments that may not reflect the Company’s actual financial condition or results of operations following the Merger. The pro forma information does not necessarily reflect all costs, synergies, dis-synergies, integration expenses, financing effects, compensation arrangements, tax consequences, accounting adjustments, control remediation costs, changes in business strategy or other effects of the completed Merger. The Company’s actual results may differ materially from the pro forma information due to changes in interest rates, market conditions, asset performance, credit losses, financing costs, operating expenses, integration costs, accounting estimates, valuation assumptions or other factors.

Investors should not place undue reliance on pro forma financial information as an indication of what the Company’s financial condition or results of operations would have been had the Merger occurred on the dates assumed in the pro forma presentation, or as an indication of the Company’s future results.