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): June 21, 2022

Franklin BSP Realty Trust, Inc.

(Exact Name of Registrant as Specified in Its Charter)

1345 Avenue of the Americas, Suite 32A

New York, New York 10105

(Address of principal executive offices, including zip code)

Registrant’s telephone number, including area code: (212) 588-6770

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):

Securities registered pursuant to Section 12(b) of the Act:

Indicated by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter)

Emerging growth company ¨

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 Preferred Stock Exchange Agreement

On June 21, 2022, Franklin BSP Realty Trust, Inc. (the “Company”) and the holder (the "Holder") of the Company's Series D Convertible Preferred Stock ("Series D Preferred Stock") entered into an Exchange Agreement (the “Exchange Agreement”), pursuant to which the Holder agreed to exchange all 17,949 shares of the Series D Preferred Stock owned by the Holder and its affiliates into an equal amount of newly issued shares (the “Shares”) of the Company’s new series of Series H Convertible Preferred Stock (“Series H Preferred Stock”). The settlement of the exchange of the Shares contemplated by the Exchange Agreement was completed on June 24, 2022.

The exchange of the Shares was undertaken to accommodate the Holder’s request to extend the mandatory conversion date set forth in the terms of the Series D Preferred Stock, which was set to occur on October 19, 2022, to January 19, 2023. There are no other material differences between the terms of the Series D Preferred Stock and Series H Preferred Stock. The Company received no consideration for the exchange.

The Board granted the Holder certain exemptions from the ownership limitations in the Company’s Articles of Amendment and Restatement (the “Charter”) with respect to the Holder’s ownership of the Series H Preferred Stock.

This exchange was not registered under the Securities Act of 1933, as amended (the “Securities Act”) and was made pursuant to the exemption provided by Section 3(a)(9) of the Securities Act and certain rules and regulations promulgated thereunder. The Shares may not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

The foregoing description of the Exchange Agreement is a summary and is qualified in its entirety by the terms of the Exchange Agreement which is attached hereto as Exhibit 10.1 and is incorporated herein by reference.

Terms of the Series H Convertible Preferred Stock

As set forth in the Articles Supplementary, the shares of Series H Preferred Stock have terms substantially similar to the shares of Series D Preferred Stock, except for the change in the conversion timing described below.

On January 19, 2023, each outstanding share of Series H Preferred Stock shall convert (the “Mandatory Conversion”) into 299.2 shares of the Company’s common stock, par value $0.01 per share (“Common Stock”), subject to anti-dilution adjustments (the “Conversion Rate”). However, each holder of Series H Preferred Stock has the right to accelerate the Mandatory Conversion to an earlier date of the holder’s choice, subject to required notice. Each holder also has the option to convert its shares of Series H Preferred Stock into Common Stock upon a Change in Control (as defined in the Articles Supplementary) of the Company.

The Articles Supplementary were filed with the Maryland State Department of Assessments and Taxation on June 21, 2022. The Articles Supplementary became effective on filing. The Articles Supplementary classified and designated 20,000 shares of Series H Preferred Stock, of which approximately 17,949 shares were outstanding as of June 24, 2022.

The foregoing description of the Articles Supplementary is a summary and is qualified in its entirety by the terms of the Articles Supplementary which is attached hereto as Exhibit 3.1 and is incorporated herein by reference.

 The information set forth above under Item 1.01 is hereby incorporated by reference into this Item 3.02.

The information set forth above under Item 1.01 is hereby incorporated by reference into this Item 3.03.

The information set forth above under Item 1.01 related to the Articles Supplementary is hereby incorporated by reference into this Item 5.03. 

(d) Exhibits.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. 

Date: June 24, 2022