CMO Capstead Mortgage Corporation

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): October 19, 2021

Registrant’s Telephone Number, Including Area Code: (214) 874-2323

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2 below):

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act or Rule 12b-2 of the Exchange Act.

Emerging growth company ☐

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Introductory Note

This Current Report on Form 8-K is being filed in connection with the consummation on October 19, 2021 (the “Closing Date”), of the transactions contemplated by that certain Agreement and Plan of Merger, dated as of July 25, 2021, as amended pursuant to that certain First Amendment to Agreement and Plan of Merger, dated as of September 22, 2021 (as amended, the “Merger Agreement”), by and among Franklin BSP Realty Trust, Inc. (f/k/a Benefit Street Partners Realty Trust, Inc.), a Maryland corporation (“FBRT”), Rodeo Sub I, LLC, a Maryland limited liability company and a wholly owned subsidiary of FBRT (“Merger Sub”), Capstead Mortgage Corporation, a Maryland corporation (“Capstead”), and, solely for the purposes set forth therein, Benefit Street Partners L.L.C., a Delaware limited liability company and FBRT’s external manager (“BSP”). Pursuant to the Merger Agreement, on the Closing Date, Capstead merged with and into Merger Sub, with Merger Sub continuing as the surviving company (the “Merger”). The combined company will continue to operate under the name “Franklin BSP Realty Trust, Inc.”, and, as of the Closing Date, its shares of common stock, par value $0.01 per share (“FBRT Common Stock”), trade on the New York Stock Exchange (“NYSE”) under the ticker symbol “FBRT”. The following events took place in connection with the consummation of the Merger.

The issuances of shares of FBRT Common Stock and FBRT Series E Preferred Stock in connection with the Merger were registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to FBRT’s registration statement on Form S-4 (Registration No. 333-258947), which was declared effective by the U.S. Securities and Exchange Commission (the “SEC”) on September 3, 2021 (as amended or supplemented, the “FBRT S-4 Registration Statement”). The proxy statement/prospectus included in the FBRT S-4 Registration Statement contains additional information regarding the Merger and incorporates by reference additional information regarding the Merger from Current Reports on Form 8-K filed by Capstead.

Per the terms of the transactions described in the Merger Agreement, approximately 32.1 million shares of FBRT Common Stock will be issued in connection with the Merger to former Capstead common stockholders, and former Capstead common stockholders will own approximately 36% of the common equity of FBRT as the combined company following the consummation of the Merger (after applying (i) the conversion of all of the outstanding shares of FBRT’s Series A convertible preferred stock into FBRT Common Stock as of the Closing Date and (ii) assuming conversion of all of the outstanding shares of FBRT’s Series C, Series D and Series F convertible preferred stock (as if such shares had converted into FBRT Common Stock on the Closing Date)).

The foregoing description of the Merger and the other transactions contemplated by the Merger Agreement is only a summary, does not purport to be complete and is subject to, and qualified in its entirety by, reference to the full text of the Merger Agreement, which was previously filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the SEC on July 26, 2021, and the full text of the First Amendment to Agreement and Plan of Merger, which was previously filed as Exhibit 2.1 to the Company’s Current Report on Form 8-K filed with the SEC on September 23, 2021, both of which are incorporated herein by reference.

Time, which were automatically canceled and retired and ceased to exist) was cancelled and converted into the right to receive the Total Per Common Share Consideration as of the Effective Time; (ii) each share of Capstead Series E Preferred Stock issued and outstanding immediately prior to the Effective Time was cancelled and converted into the right to receive one newly-issued share of newly-designated FBRT Series E Preferred Stock as of the Effective Time; (iii) each share of restricted stock outstanding under the Capstead Plan immediately prior to the Effective Time became fully-vested and non-forfeitable as of the Effective Time and each share of Capstead Common Stock represented thereby became eligible to receive the Total Per Common Share Consideration as of the Effective Time; and (iv) each award of performance units outstanding under the Capstead Plan automatically became earned and vested immediately prior to the Effective Time at the conversion rate of one share of Capstead Common Stock for each outstanding performance unit and each share of Capstead Common Stock represented thereby became eligible to receive the Total Per Common Share Consideration as of the Effective Time.

As of the Effective Time, holders of Capstead Common Stock immediately prior to the Effective Time ceased to have any rights as common stockholders of Capstead (other than the right to receive the Total Per Common Share Consideration from FBRT and BSP, or as otherwise provided by the Merger Agreement or by law). As of the Effective Time, holders of Capstead Series E Preferred Stock immediately prior to the Effective Time ceased to have any rights as preferred stockholders of Capstead (other than the right to receive shares of FBRT Series E Preferred Stock from FBRT or as otherwise provided by the Merger Agreement or by law).

The rights of holders of capital stock of FBRT are governed by FBRT’s Articles of Amendment and Restatement, as amended, including the Articles Supplementary thereto, and FBRT’s Amended and Restated Bylaws. The description of the capital stock of FBRT has previously been set forth in the section entitled “Description of BSPRT Capital Stock” in the FBRT S-4 Registration Statement, which section is hereby incorporated into this Item 3.03 by reference.