At-the-Market-Offering Sales Agreement
On April 14, 2023, Franklin BSP Realty Trust, Inc.
(the “Company”) and Benefit Street Partners Realty Operating Partnership, L.P., a Delaware limited partnership (the “Operating
Partnership”) established a $200.0 million at-the-market offering program (“ATM program”) by entering into a Sales Agreement
(the “Sales Agreement”) with Barclays Capital Inc., B. Riley Securities, Inc., JMP Securities LLC, JonesTrading Institutional
Services LLC, J.P. Morgan Securities LLC and Raymond James & Associates, Inc. as sales agents (in such capacity, each an “Agent”
and together, the “Agents”), pursuant to which the Company may sell, from time to time, and at various prices, through the
Agents, shares of the Company’s common stock (the “Common Stock”).
Although given current market conditions the Company
does not presently intend to utilize the ATM program, the Company believes that the ATM program, together with the Company’s $65
million share repurchase program, will provide the Company with maximum flexibility to capitalize on a wide range of potential capital
markets environments and support the long-term execution of its business plan.
The Common Stock sold in the offering will be issued
pursuant to a prospectus supplement filed with the Securities and Exchange Commission (the “SEC”) on April 14, 2023, and the
accompanying base prospectus dated November 12, 2021 forming part of the Company’s shelf registration statement on Form S-3
(Registration No. 333-261039) declared effective by the SEC on November 12, 2021.
Subject to the terms and conditions of the Sales
Agreement, the Agents will use their commercially reasonable efforts, consistent with their normal trading and sales practices and applicable
law and regulations, to sell the Common Stock that may be designated by the Company pursuant to the Sales Agreement on the terms and subject
to the conditions of the Sales Agreement. Sales, if any, of the Common Stock made through the Agents, pursuant to the Sales Agreement,
may be made in “at the market” offerings (as defined in Rule 415 under the Securities Act of 1933, as amended (the “Securities
Act”)), by means of ordinary brokers’ transactions on the New York Stock Exchange or otherwise, at market prices prevailing
at the time of sale, in block transactions, in negotiated transactions, in any manner permitted by applicable law or as otherwise as may
be agreed by the Company and any Agent. The Company will offer and sell shares of common stock through only one Agent on any given trading
day.
The Company or any Agent may at any time
suspend an offering of Common Stock pursuant to the terms of the Sales Agreement. The offering of Common Stock pursuant to the Sales
Agreement will terminate upon the earliest of (i) the sale of shares of Common Stock subject to the Sales Agreement having an
aggregate gross sales price of $200,000,000, (ii) the termination of the Sales Agreement by the Company, and (iii) November 12, 2024. In
addition, each sales agent has the right to terminate the Sales Agreement only as to itself.
The Company and the Operating Partnership made
certain customary representations, warranties and covenants concerning the Company, the Operating Partnership and the registration statement
in the Sales Agreement and also agreed to indemnify the Agents against certain liabilities, including liabilities under the Securities
Act.
The Company intends to use the net proceeds from
this offering to originate additional commercial mortgage loans and other target assets and investments. The Company may also use a portion
of the net proceeds for other general corporate purposes, including, but not limited to, the payment of liabilities and other working
capital needs.
The Company will pay each Agent a Commission that
will not exceed 2.0% of the gross sales price of all shares of Common Stock sold through it as our Agent pursuant to the Sales Agreement.
A copy of the form of the Sales Agreement is attached
to this Current Report on Form 8-K as Exhibit 1.1 and is incorporated herein by reference. The summary set forth above is qualified
in its entirety by reference to Exhibit 1.1.