Independence Realty Trust, Inc. (NYSEMKT:IRT) Files An 8-K Entry into a Material Definitive Agreement

Independence Realty Trust, Inc. (NYSEMKT:IRT) Files An 8-K Entry into a Material Definitive Agreement

Item 1.01

Entry into a Material Definitive Agreement.

Independence Realty Trust, Inc. (IRT) previously disclosed entry
into a Securities and Asset Purchase Agreement, dated September
27, 2016, to complete a management internalization
(Internalization) and separation from RAIT Financial Trust (RAIT)
and certain of its affiliates (the Purchase Agreement). On
December 20, 2016, the parties completed the second closing under
the Purchase Agreement. Simultaneously with the second closing,
IRT entered into a Shared Services Agreement (the Shared Services
Agreement) with RAIT dated December 20, 2016.

to the terms of the Shared Services Agreement, RAIT and IRT will
provide each other with transitional services, including but not
limited to accounting, human resources, information technology,
real estate and legal services, for a period of six months. In
consideration for the various services provided by IRT and RAIT,
IRT shall pay to RAIT net fees of $777,168 for the six-month term
(i.e., $129,528 per month).

The foregoing description of the Shared Services Agreement is not
complete. Reference is made to the Shared Services Agreement
filed as Exhibit 10.1 to this Form 8-K.

On December 21, 2016, Independence Realty Operating Partnership,
LP (IROP), the operating partnership of IRT, entered into an
Increase Agreement (the Increase Agreement) by and among IROP, as
borrower, subsidiaries of IROP named therein, KeyBank National
Association (KeyBank), the other lenders party thereto, KeyBank,
as administrative agent, The Huntington National Bank (HNB), as
syndication agent and KeyBanc Capital Markets (KeyBanc Capital)
and HNB, as joint lead arrangers and book managers, and Capital
One, National Association, as documentation agent, and a
Guarantor Confirmation from IRT and IR TS Op Co, LLC (Op Co). The
Increase Agreement amended the terms of the previously disclosed
Credit Agreement (as amended, the “Credit Agreement”) dated as
of September 17, 2015 and previously amended on October 2, 2015
among the parties to the Increase Agreement and other lenders.The
Credit Agreement provided for a revolving line of credit (the
Revolver) and a term loan (the Term Loan).At December 21, 2016
$10.0 million was outstanding under the Revolver.The Term Loan
had been paid down $60.0 million from the $200.0 million
originally outstanding to $140.0 million as of December 21, 2016
using a portion of the proceeds of IRTs October 2016 common stock
offering.As a result of this offering and these repayments, the
lenders party to the Increase Agreement agreed to increase the
Revolver component of the Credit Agreement which IRT believes
enhances its liquidity and financial flexibility.

The Increase Agreement amended the Credit Agreement as of
December 21, 2016 as follows:

The foregoing description of the Increase Agreement is not
complete. Reference is made to the Increase Agreement filed as
Exhibit 10.2 to this Form 8-K.

Following completion of the Internalization, on December 20,
2016, IRT terminated that certain Second Amended and Restated
Advisory Agreement (the Advisory Agreement) by and among IRT,
Independence Realty Operating Partnership, LP (IROP), and
Independence Realty Advisors, LLC (IRA), dated May 7, 2013, as
amended by the First Amendment dated July 26, 2013 and the Second
Amendment dated September 25, 2015. This

termination was accomplished by a Termination Agreement (the
Termination Agreement) dated as of December 20, 2016 entered into
by the parties to the Advisory Agreement.There were no
termination penalties incurred by IRT as a result of the
termination of the Advisory Agreement. Under the Advisory
Agreement, IRA had previously been responsible for the day-to-day
operations of IRT and IROP and performed, as appropriate,
services and activities relating to the assets and operations of
IRT in exchange for a base fee and a possible incentive fee. As a
result of the Internalization, IRT acquired IRA and will perform
the functions previously performed by IRA internally.

The foregoing description of the Termination Agreement is not
complete. Reference is made to the Termination Agreement filed as
Exhibit 10.3 to this Form 8-K.

Item 2.03 Creation of a Direct Financial Obligation or an
Obligation under an Off-Balance Sheet Arrangement of a
Registrant.

The information provided in Item 1.01 above is incorporated by
reference into this Item 2.03.

(e)

Simultaneously with the closing under the Purchase Agreement on
December 20, 2016, IRT entered into employment agreements with
each of Scott F. Schaeffer, IRTs Chief Executive Officer (CEO),
Farrell Ender, IRTs President, and James J. Sebra, IRTs Chief
Financial Officer (CFO).The employment agreements for Messrs.
Schaeffer and Ender became effective upon the closing of the
Internalization, and the employment agreement for Mr. Sebra will
become effective upon the later of March 31, 2017 and the date on
which RAIT files its annual report on Form 10-K for the fiscal
year ended December 31, 2016.

Each employment agreement will continue until the third
anniversary of its effective date (subject to earlier termination
as described below), and will remain effective for successive
one-year periods unless either party notifies the other party of
non-renewal in writing prior to three months before the
expiration of the then current term.During the term of each
executives employment under his employment agreement (the
Employment Term), Messrs. Schaeffer, Ender and Sebra will
continue to serve as CEO, President and CFO of IRT, respectively,
and Mr. Schaeffer will continue to serve as Chairman of the Board
of Directors of IRT (the Board), subject to the right of the
Board to elect a different person to serve as Chairman.During the
Employment Term, Mr. Schaeffer will serve as a member of the
Board, subject to his election to the Board by the stockholders
of IRT during each year of the Employment Term, and IRT will
nominate Mr. Schaeffer for election to the Board at any meeting
of the stockholders where the election of Board members is
included in the purposes of such meeting.

Each executive will receive a base salary, which will be reviewed
annually for appropriate increases by the Board (but which may
not be decreased), as follows: $618,600 per annum for Mr.
Schaeffer; $308,600 per annum for Mr. Ender; and $398,600 per
annum for Mr. Sebra.Each executive will be eligible to receive
annual bonuses in such amounts as the Board may approve in its
sole discretion or under the terms of any annual incentive plan
of IRT maintained for other senior level executives.The
executives will be entitled to participate in all employee
retirement and welfare benefit plans and programs or executive
perquisites made available to IRTs senior level executives as a
group or to its employees generally.For purposes of any vacation,
holiday and sick leave policies of IRT that condition
participation or entitlements on duration of service with IRT,
each executives service with RAIT will be treated as service with
IRT.The executives also will be entitled to participate in any
short-term and long-term incentive programs established by IRT
for its senior level executives generally.

If the executives employment is terminated by IRT without cause,
by the executive for good reason (as each such term is defined in
the employment agreements), or due to the non-renewal of the
employment agreement by IRT, then the executive will be entitled
to receive the following payments and benefits, subject to his
execution and non-revocation of a release of claims: (i) a lump
sum cash payment equal to two and one quarter times (for Mr.
Schaeffer) or two times (for Messrs. Ender and Sebra) the sum of
(x) the executives base salary and (y) the average annual cash
bonus earned by the executive for the three year period
immediately prior to his

termination of employment or the average annual cash bonus earned
by the executive for the actual number of completed fiscal years
immediately prior to his termination of employment if less than
three, provided that if the executive has been employed for less
than one completed fiscal year, the amount used for clause (y)
will be his target annual cash bonus for the fiscal year of his
termination of employment; (ii) a lump sum cash payment equal to
a pro rata portion of the annual cash bonus, if any, that the
executive would have earned for the fiscal year of his
termination based on achievement of the applicable performance
goals for such year; (iii) for a period of 18 months, the
executive and his eligible dependents will continue to receive
the medical coverage in effect at the date of his termination of
employment (or generally comparable coverage) at the same premium
rates as may be charged from time to time for employees of IRT
generally, subject to their timely election of COBRA continuation
coverage; and (iv) the executives outstanding equity awards will
be treated in accordance with the terms of the applicable
incentive plan and award agreements, provided that any such
equity awards that are subject solely to time-vesting conditions
will become fully vested.The executive will also be entitled to
receive any accrued or earned amounts or benefits that remain
unpaid as of the date of his termination.

If Mr. Schaeffers employment is terminated by IRT without cause
or by him for good reason, in each case upon or within eighteen
months after a change in control (as such term is defined in his
employment agreement), then he will be entitled to receive the
severance payments and benefits described in the preceding
paragraph, except that the severance multiple will be increased
from two and one quarter to three.

If, prior to the effective date of Mr. Sebras employment
agreement, IRT notifies Mr. Sebra that it does not wish for him
to commence employment with IRT, then he will be entitled to
receive the following payments and benefits, subject to his
execution and non-revocation of a release of claims: (i) a lump
sum cash payment equal to two times the sum of (x) his base
salary and (y) his target annual cash bonus for fiscal year 2017;
(ii) a lump sum cash payment equal to a pro rata portion of the
annual cash bonus, if any, that he would have earned for fiscal
year 2017 had he commenced employment with IRT based on
achievement of the applicable performance goals for such year;
and (iii) his outstanding equity awards will be treated in
accordance with the terms of the applicable incentive plan and
award agreements, provided that any such equity awards that are
subject solely to time-vesting conditions will become fully
vested.Mr. Sebra will not be entitled to receive the foregoing
payments or benefits if, at the time IRT notifies Mr. Sebra that
it does not wish for him to commence employment with IRT, IRT
would have had grounds to terminate Mr. Sebras employment for
cause had he been an employee of IRT at such time.

If the executives employment terminates due to his disability (as
such term is defined in the employment agreements) or death, then
the executive or his executor, legal representative,
administrator or designated beneficiary, as applicable, will
receive (in addition to any accrued or earned amounts or benefits
that remain unpaid as of the date of his termination) a lump sum
cash payment equal to a pro rata portion of his target annual
cash bonus for the fiscal year of his termination (or, in the
absence of a target bonus opportunity for such fiscal year, a pro
rata portion of the average annual cash bonus earned by the
executive for the three year period immediately prior to his
termination of employment or the average annual cash bonus earned
by the executive for the actual number of completed fiscal years
immediately prior to his termination of employment if less than
three).

During the Employment Term and for a period of 12 months after
the termination of the Employment Term, without regard to its
termination for any reason which does not constitute a breach of
the employment agreement by IRT or a resignation by the executive
for good reason, the executive is subject to non-competition and
non-solicitation (of employees and customers) covenants.The
employment agreements also contain customary non-disclosure of
confidential information, assignment of intellectual property
rights, clawback/recoupment and non-disparagement covenants.

The foregoing description of the employment agreements is not
complete and is qualified in its entirety by reference to the
employment agreements, which are attached hereto as Exhibits
10.4, 10.5 and 10.6, and are incorporated herein by reference.

On December 20, 2016, IRT issued a press release announcing the
completion of the Internalization. A copy of the press release is
attached as Exhibit 99.1 hereto, and is incorporated herein by
reference.

(d) Exhibits.

About Independence Realty Trust, Inc. (NYSEMKT:IRT)
Independence Realty Trust, Inc. is an externally managed and advised apartment real estate investment trust (REIT). The Company’s business consists of owning, managing, operating, leasing, acquiring, developing, investing in, and disposing of real estate assets. It owns and operates a portfolio of garden style and mid-rise apartment communities in the Southeastern United States. The Company’s portfolio consists of approximately 50 apartment properties containing an aggregate of over 13,700 apartment units. The Company’s portfolio has an average occupancy of approximately 93.6%. Its apartment properties include Belle Creek, Copper Mill, Crestmont, Cumberland Glen, Heritage Trace, Tresa at Arrowhead, Centrepoint, Augusta, Carrington Park, Arbors at the Reservoir, Walnut Hill, Lenoxplace, Stonebridge Crossing, Miller Creek at German Town, Pointe at Canyon Ridge, St James at Goose Creek and Talison Row at Daniel Island. It is managed by a subsidiary of RAIT Financial Trust (RAIT). Independence Realty Trust, Inc. (NYSEMKT:IRT) Recent Trading Information
Independence Realty Trust, Inc. (NYSEMKT:IRT) closed its last trading session up +0.13 at 8.92 with 445,695 shares trading hands.