As previously disclosed, on July 25, 2021, Capstead Mortgage Corporation, a Maryland corporation (Capstead), entered into an Agreement and
Plan of Merger, 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), with Benefit Street Partners Realty Trust, Inc., a Maryland
corporation (BSPRT), Rodeo Sub I, LLC, a Maryland limited liability company and a wholly-owned subsidiary of BSPRT (Merger Sub), and Benefit Street Partners L.L.C., a Delaware limited liability company (BSPRT
Advisor), pursuant to which, subject to the terms and conditions therein, Capstead will merge with and into Merger Sub, with Merger Sub remaining as a wholly-owned subsidiary of BSPRT (such transaction, the Merger). On
September 7, 2021, Capstead and BSPRT respectively filed a definitive proxy statement/prospectus (the Definitive Proxy Statement) with the U.S. Securities and Exchange Commission (the SEC) for the solicitation of proxies
in connection with the special meeting of the common stockholders of Capstead, to be held on October 15, 2021, to vote upon matters in connection with the Merger. On September 23, 2021, Capstead and BSPRT respectively filed a supplement to
the Definitive Proxy Statement (as supplemented, the Proxy Statement) with respect to the First Amendment to Agreement and Plan of Merger.
Five lawsuits have been filed by purported stockholders of Capstead with respect to the Merger. The first suit, styled as Shiva Stein v. Capstead Mortgage
Corporation, et al., No. 1:21-cv-7306 (the Stein Lawsuit), was filed in the United States District Court for the Southern District of New York on
August 31, 2021, and asserts claims against Capstead, members of the Capstead board of directors (the Capstead Board), BSPRT and Merger Sub. The second suit, styled as Matthew Hopkins v. Capstead Mortgage Corporation, et al.,
No. 1:21-cv-07369 (the Hopkins Lawsuit), was filed in the United States District Court for the Southern District of New York on September 1, 2021, and
asserts claims against Capstead, members of the Capstead Board, BSPRT, Merger Sub and BSPRT Advisor. The third suit, styled as Bryan Harrington v. Capstead Mortgage Corporation, et al., No. 1:21-cv-05080 (the Harrington Lawsuit), was filed in the United States District Court for the Eastern District of New York on September 11, 2021, and asserts claims against Capstead
and members of the Capstead Board. The fourth suit, styled as Randy Gill v. Capstead Mortgage Corporation, et al., No. 1:21-cv-07973 (the Gill
Lawsuit), was filed in the United States District Court for the Southern District of New York on September 24, 2021, and asserts claims against Capstead and members of the Capstead Board. The fifth suit, styled as Jordan Wilson v.
Capstead Mortgage Corporation, et al., No. 1:21-cv-08147-UA (the Wilson Lawsuit), was filed in the United States
District Court for the Southern District of New York on October 1, 2021, and asserts claims against Capstead and members of the Capstead Board.
Capstead has also received demand letters from two purported stockholders, Brett Braafhart and Angelo Fisichella, threatening to assert claims against
Capstead and members of the Capstead Board (such demand letters, together with the Stein Lawsuit, the Hopkins Lawsuit, the Harrington Lawsuit, the Gill Lawsuit and the Wilson Lawsuit, the Lawsuits).
Each of the Lawsuits alleges that certain of the disclosures in the Proxy Statement are deficient, and seeks preliminary and injunctive relief. While Capstead
believes that the disclosures set forth in the Proxy Statement comply fully with applicable law, in order to address certain disclosure claims in the Lawsuits, minimize the cost, risk and uncertainty inherent in litigation, avoid nuisance and
preclude any efforts to delay the completion of the Merger, Capstead has determined to voluntarily supplement the Proxy Statement with the supplemental disclosures set forth below (the Supplemental Disclosures). Nothing in the
Supplemental Disclosures shall be deemed an admission of liability, wrongdoing or the legal merit, necessity or materiality under applicable laws of any of the disclosures set forth herein. To the contrary, Capstead believes the claims asserted in
the Lawsuits are without merit and expressly denies all allegations in the Lawsuits, including that any additional disclosure was or is required.
Supplemental Disclosures to Proxy Statement
The
following Supplemental Disclosures should be read in conjunction with the Proxy Statement, which should be read in its entirety. All page references are to pages in the Definitive Proxy Statement, and terms used below, unless otherwise defined, have
the meanings set forth in the Proxy Statement. Underlined text shows text being added to a referenced disclosure in the Proxy Statement.