Document:

Exhibit
10.5 

 

FORM
OF INDEMNIFICATION AGREEMENT

 

THIS INDEMNIFICATION
AGREEMENT (“Agreement”) is made and entered into as of the _____ day of _______________, 2020, by and between Franklin
BSP Capital L.L.C., a Delaware limited liability company (together with any successor thereto, including, after conversion to
a Delaware corporation, Franklin BSP Capital Corporation, the “Company”), and _________________________ (“Indemnitee”).1

 

WHEREAS,
at the request of the Company, Indemnitee currently serves as a director or officer of the Company and may, therefore, be subjected
to claims, suits or proceedings arising as a result of his or her service; and

 

WHEREAS,
as an inducement to Indemnitee to continue to serve as such director or officer, the Company has agreed to indemnify and to advance
expenses and costs incurred by Indemnitee in connection with any such claims, suits or proceedings; and

 

WHEREAS,
the parties by this Agreement desire to set forth their agreement regarding indemnification and advance of expenses;

 

NOW, THEREFORE,
in consideration of the premises and the covenants contained herein, the Company and Indemnitee do hereby covenant and agree as
follows:

 

Section
1.                   Definitions.
For purposes of this Agreement:

 

(a)               
“1940 Act” means the Investment Company Act of 1940, as amended, and rules thereunder.

 

(b)               
“Applicable Legal Rate” means a fixed rate of interest equal to the applicable
federal rate for mid-term debt instruments as of the day that it is determined that Indemnitee must repay any advanced expenses.

 

(c)               
“Change in Control” means a change in control of the Company occurring after
the Effective Date of a nature that would be required to be reported in response to Item 6(e) of Schedule 14A of Regulation
14A (or in response to any similar item on any similar schedule or form) promulgated under the Securities Exchange Act of 1934,
as amended (the “Exchange Act”), whether or not the Company is then subject to such reporting requirement; provided,
however, that, without limitation, such a Change in Control shall be deemed to have occurred if, after the Effective Date (i)
any “person” (as such term is used in Sections 13(d) and 14(d) of the Exchange Act) is or becomes the “beneficial
owner” (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the Company representing
15% or more of the combined voting power of all of the Company’s then-outstanding securities entitled to vote generally
in the election of directors without the prior approval of at least two-thirds of the members of the Board of Directors in office
immediately prior to such person’s attaining such percentage interest; (ii) the Company is a party to a merger, consolidation,
sale of assets, plan of liquidation or other reorganization not approved by at least two-thirds of the members of the Board of
Directors then in office, as a consequence of which members of the Board of Directors in office immediately prior to such transaction
or event constitute less than a majority of the Board of Directors thereafter; or (iii) at any time, a majority of the members
of the Board of Directors are not individuals (A) who were directors as of the Effective Date or (B) whose election by the Board
of Directors or nomination for election by the Company’s stockholders was approved by the affirmative vote of at least two-thirds
of the directors then in office who were directors as of the Effective Date or whose election for nomination for election was
previously so approved.

 

 

1
Insert names of directors or officers.

 

 

     

     

    

 

(d)               
“Corporate Status” means the status of a person as a present or former director,
officer, employee or agent of the Company or as a director, trustee, officer, partner, manager, managing member, fiduciary, employee
or agent of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee
benefit plan or other enterprise that such person is or was serving in such capacity at the request of the Company. As a clarification
and without limiting the circumstances in which Indemnitee may be serving at the request of the Company, service by Indemnitee
shall be deemed to be at the request of the Company if Indemnitee serves or served as a director, trustee, officer, partner, manager,
managing member, fiduciary, employee or agent of any corporation, partnership, limited liability company, joint venture, trust,
employee benefit plan or other enterprise (i) of which a majority of the voting power or equity interest is owned directly or
indirectly by the Company or (ii) the management of which is controlled directly or indirectly by the Company.

 

(e)               
“Disinterested Director” means a director of the Company who is not and was not
a party to the Proceeding in respect of which indemnification and/or advance of Expenses is sought by Indemnitee.

 

(f)                
“Effective Date” means the date set forth in the first paragraph of this Agreement.

 

(g)               
“Expenses” means any and all reasonable and out-of-pocket attorneys’ fees
and costs, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing
and binding costs, telephone charges, postage, delivery service fees, federal, state, local or foreign taxes imposed on Indemnitee
as a result of the actual or deemed receipt of any payments under this Agreement, ERISA excise taxes and penalties and any other
disbursements or expenses incurred in connection with prosecuting, defending, preparing to prosecute or defend, investigating,
being or preparing to be a witness in or otherwise participating in a Proceeding. Expenses shall also include Expenses incurred
in connection with any appeal resulting from any Proceeding including, without limitation, the premium for, security for and other
costs relating to any cost bond supersede as bond or other appeal bond or its equivalent.

 

(h)               
“Independent Counsel” means a law firm, or a member of a law firm, that is experienced
in matters of corporation law and neither is, nor in the past five years has been, retained to represent: (i) the Company or Indemnitee
in any matter material to either such party (other than with respect to matters concerning Indemnitee under this Agreement or
of other indemnitees under similar indemnification agreements), or (ii) any other party to or participant or witness in the Proceeding
giving rise to a claim for indemnification or advance of Expenses hereunder. Notwithstanding the foregoing, the term “Independent
Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would
have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights
under this Agreement.

 

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(i)                
“Proceeding” means any threatened, pending or completed action, suit, arbitration,
alternate dispute resolution mechanism, investigation, inquiry, administrative hearing or any other proceeding, whether brought
by or in the right of the Company or otherwise and whether of a civil (including intentional or unintentional tort claims), criminal,
administrative or investigative (formal or informal) nature, including any appeal therefrom, except one pending or completed on
or before the Effective Date, unless otherwise specifically agreed in writing by the Company and Indemnitee. If Indemnitee reasonably
believes that a given situation may lead to or culminate in the institution of a Proceeding, such situation shall also be considered
a Proceeding.

 

Section
2.                   Services
by Indemnitee. Indemnitee will serve as a director or officer of the Company. However, this Agreement shall not impose any
independent obligation on Indemnitee or the Company to continue Indemnitee’s service to the Company. This Agreement shall
not be deemed an employment contract between the Company (or any other entity) and Indemnitee.

 

Section
3.                   General.
Subject to the limitations in Section 5, the Company shall indemnify, and advance Expenses to, Indemnitee (a) as provided in this
Agreement and (b) as otherwise permitted by the 1940 Act, including Section 17 (h) therein, Delaware law in effect on the Effective
Date and as amended from time to time; provided, however, that no change in Delaware law shall have the effect of reducing the
benefits available to Indemnitee hereunder based on Delaware law as in effect on the Effective Date. Subject to the limitations
in Section 5, the rights of Indemnitee provided in this Section 3 shall include, without limitation, the rights set forth in the
other sections of this Agreement, including any additional indemnification permitted by Section 145(f) of the Delaware General
Corporation Law (the “DGCL”).

 

Section
4.                   Standard
for Indemnification. Subject to the limitations in Section 5, if, by reason of Indemnitee’s Corporate Status, Indemnitee
is, or is threatened to be, made a party to any Proceeding, the Company shall indemnify Indemnitee against all judgments, penalties,
fines and amounts paid in settlement and all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s
behalf in connection with any such Proceeding unless it is established by clear and convincing evidence that (a) the act or omission
of Indemnitee was material to the matter giving rise to the Proceeding and (i) was committed in bad faith or (ii) was the result
of active and deliberate dishonesty, (b) Indemnitee actually received an improper personal benefit in money, property or services
or (c) in the case of any criminal Proceeding, Indemnitee had reasonable cause to believe that his or her conduct was unlawful.

 

Section
5.                   Certain
Limits on Indemnification. Notwithstanding any other provision of this Agreement, Indemnitee shall not be entitled to:

 

(a)               
indemnification for any loss or liability unless all of the following conditions are met:
(i) Indemnitee has determined, in good faith, that the course of conduct that caused the loss or liability was in the best interests
of the Company; (ii) Indemnitee was acting on behalf of or performing services for the Company; (iii) such loss or liability was
not the result of negligence or misconduct; and (iv) such indemnification is recoverable only out of the Company’s net assets
and not from the Company’s stockholders;

 

(b)               
indemnification for any loss or liability arising from an alleged violation of federal or
state securities laws unless one or more of the following conditions are met: (i) there has been a successful adjudication on
the merits of each count involving alleged material securities law violations as to Indemnitee; (ii) such claims have been dismissed
with prejudice on the merits by a court of competent jurisdiction as to Indemnitee; or (iii) a court of competent jurisdiction
approves a settlement of the claims against Indemnitee and finds that indemnification of the settlement and the related costs
should be made, and the court considering the request for indemnification has been advised of the position of the Securities and
Exchange Commission and of the published position of any state securities regulatory authority in which securities of the Company
were offered or sold as to indemnification for violations of securities laws;

 

(c)               
indemnification hereunder if the Proceeding was one by or in the right of the Company and
Indemnitee is adjudged to be liable to the Company;

 

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(d)               
indemnification hereunder if Indemnitee is adjudged to be liable on the basis that personal
benefit was improperly received in any Proceeding charging improper personal benefit to Indemnitee, whether or not involving action
in the Indemnitee’s Corporate Status; or

 

(e)               
indemnification or advance of Expenses hereunder if the Proceeding was brought by Indemnitee,
unless: (i) the Proceeding was brought to enforce indemnification under this Agreement, and then only to the extent in accordance
with and as authorized by Section 11 of this Agreement, or (ii) the Company’s charter or Bylaws, a resolution of the stockholders
entitled to vote generally in the election of directors or of the Board of Directors or an agreement approved by the Board of
Directors to which the Company is a party expressly provide otherwise.

 

Section
6.                   Indemnification
for Expenses of an Indemnitee Who is Wholly or Partly Successful. Subject to the limitations in Section 5, to the extent that
Indemnitee was or is, by reason of his or her Corporate Status, made a party to (or otherwise becomes a participant in) any Proceeding
and is successful, on the merits or otherwise, in the defense of such Proceeding, Indemnitee shall be indemnified for all Expenses
actually and reasonably incurred by Indemnitee or on Indemnitee’s behalf in connection therewith. If Indemnitee is not wholly
successful in such Proceeding but is successful, on the merits or otherwise, as to one or more but less than all claims, issues
or matters in such Proceeding, the Company shall indemnify Indemnitee under this Section 6 for all Expenses actually and reasonably
incurred by Indemnitee or on Indemnitee’s behalf in connection with each such claim, issue or matter, allocated on a reasonable
and proportionate basis. For purposes of this Section 6, and without limitation, the termination of any claim, issue or matter
in such a Proceeding by dismissal, with or without prejudice, shall be deemed to be a successful result as to such claim, issue
or matter.

 

Section
7.                   Advance
of Expenses for an Indemnitee. Subject to the limitations described in Section 3 herein, if, by reason of Indemnitee’s
Corporate Status, Indemnitee is, or is threatened to be, made a party to any Proceeding, the Company shall, without requiring
a preliminary determination of Indemnitee’s ultimate entitlement to indemnification hereunder, advance all reasonable Expenses
incurred by or on behalf of Indemnitee in connection with (a) such Proceeding which is initiated by a third party who is not a
stockholder of the Company, or (b) such Proceeding which is initiated by a stockholder of the Company acting in his or her capacity
as such and for which a court of competent jurisdiction specifically approves such advancement, and which relates to acts or omissions
with respect to the performance of duties or services on behalf of the Company, within ten days after the receipt by the Company
of a statement or statements requesting such advance or advances from time to time, whether prior to or after final disposition
of such Proceeding. Such statement or statements shall reasonably evidence the Expenses incurred by Indemnitee and shall include
or be preceded or accompanied by a written affirmation by Indemnitee of Indemnitee’s good faith belief that the standard
of conduct necessary for indemnification by the Company as authorized by law and by this Agreement has been met and a written
undertaking by or on behalf of Indemnitee, in substantially the form attached hereto as Exhibit A or in such form as may
be required under applicable law as in effect at the time of the execution thereof, to reimburse the portion of any Expenses advanced
to Indemnitee, together with the Applicable Legal Rate of interest thereon, relating to claims, issues or matters in the Proceeding
as to which it shall ultimately be established, by clear and convincing evidence, that the standard of conduct has not been met
by Indemnitee and which have not been successfully resolved as described in Section 6 of this Agreement. To the extent that Expenses
advanced to Indemnitee do not relate to a specific claim, issue or matter in the Proceeding, such Expenses shall be allocated
on a reasonable and proportionate basis. The undertaking required by this Section 7 shall be an unlimited general obligation by
or on behalf of Indemnitee and shall be accepted without reference to Indemnitee’s financial ability to repay such advanced
Expenses and without any requirement to post security therefor.

 

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Section
8.                   Indemnification
and Advance of Expenses as a Witness or Other Participant. Subject to the limitations in Section 5, to the extent that Indemnitee
is or may be, by reason of Indemnitee’s Corporate Status, made a witness or otherwise asked to participate in any Proceeding,
whether instituted by the Company or any other party, and to which Indemnitee is not a party, Indemnitee shall be advanced all
reasonable Expenses and indemnified against all Expenses actually and reasonably incurred by Indemnitee or on Indemnitee’s
behalf in connection therewith within ten days after the receipt by the Company of a statement or statements requesting any such
advance or indemnification from time to time, whether prior to or after final disposition of such Proceeding. Such statement or
statements shall reasonably evidence the Expenses incurred by Indemnitee.

 

Section
9.                   Procedure
for Determination of Entitlement to Indemnification.

 

(a)               
To obtain indemnification under this Agreement, Indemnitee shall submit to the Company a
written request, including therein or therewith such documentation and information as is reasonably available to Indemnitee and
is reasonably necessary to determine whether and to what extent Indemnitee is entitled to indemnification. Indemnitee may submit
one or more such requests from time to time and at such time(s) as Indemnitee deems appropriate in Indemnitee’s sole discretion.
The officer of the Company receiving any such request from Indemnitee shall, promptly upon receipt of such a request for indemnification,
advise the Board of Directors in writing that Indemnitee has requested indemnification.

 

(b)               
Upon written request by Indemnitee for indemnification pursuant to Section 9(a) above, a
determination, if required by applicable law, with respect to Indemnitee’s entitlement thereto shall promptly be made in
the specific case: (i) if a Change in Control shall have occurred, by Independent Counsel, in a written opinion to the Board of
Directors, a copy of which shall be delivered to Indemnitee, which Independent Counsel shall be selected by Indemnitee and approved
by the Board of Directors in accordance with Section 145(d) of DGCL, which approval shall not be unreasonably withheld; or (ii)
if a Change in Control shall not have occurred, (A) by a majority vote of the Disinterested Directors, even though less than a
quorum, or (B) by a committee of Disinterested Directors designated by majority vote of Disinterested Directors, even though less
than a quorum, or (C) if there are no Disinterested Directors, or if Disinterested Directors so direct in accordance with Section
145(d) of DGCL, by Independent Counsel, in a written opinion to the Board of Directors, a copy of which shall be delivered to
Indemnitee or (D) if so directed by a majority of the members of the Board of Directors, by the stockholders of the Company. If
it is so determined that Indemnitee is entitled to indemnification, payment to Indemnitee shall be made within ten days after
such determination. Indemnitee shall cooperate with the person, persons or entity making such determination with respect to Indemnitee’s
entitlement to indemnification, including providing to such person, persons or entity upon reasonable advance request any documentation
or information which is not privileged or otherwise protected from disclosure and which is reasonably available to Indemnitee
and reasonably necessary to such determination in the discretion of the Board of Directors or Independent Counsel if retained
pursuant to clause (ii)(B) of this Section 9(b). Any Expenses incurred by Indemnitee in so cooperating with the person, persons
or entity making such determination shall be borne by the Company (irrespective of the determination as to Indemnitee’s
entitlement to indemnification) and the Company shall indemnify and hold Indemnitee harmless therefrom.

 

(c)               
The Company shall pay the reasonable fees and expenses of Independent Counsel, if one is
appointed.

 

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 Section
10.               Presumptions
and Effect of Certain Proceedings.

 

(a)               
In making any determination with respect to entitlement to indemnification hereunder, the
person or persons or entity making such determination shall presume that Indemnitee is entitled to indemnification under this
Agreement if Indemnitee has submitted a request for indemnification in accordance with Section 9(a) of this Agreement, and the
Company shall have the burden of proof to overcome that presumption in connection with the making of any determination contrary
to that presumption.

 

(b)               
The termination of any Proceeding or of any claim, issue or matter therein, by judgment,
order, settlement or conviction, upon a plea of nolo contendere or its equivalent, or entry of an order of probation prior
to judgment, does not create a presumption that Indemnitee did not meet the requisite standard of conduct described herein for
indemnification.

 

(c)               
The knowledge and/or actions, or failure to act, of any other director, officer, employee
or agent of the Company or any other director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent
of any other foreign or domestic corporation, partnership, limited liability company, joint venture, trust, employee benefit plan
or other enterprise shall not be imputed to Indemnitee for purposes of determining any other right to indemnification under this
Agreement.

 

Section
11.               Remedies
of Indemnitee.

 

(a)               
If (i) a determination is made pursuant to Section 9(b) of this Agreement that Indemnitee
is not entitled to indemnification under this Agreement, (ii) advance of Expenses is not timely made pursuant to Sections 7 or
8 of this Agreement, (iii) no determination of entitlement to indemnification shall have been made pursuant to Section 9(b) of
this Agreement within 60 days after receipt by the Company of the request for indemnification, (iv) payment of indemnification
is not made pursuant to Sections 6 or 8 of this Agreement within ten days after receipt by the Company of a written request therefor,
or (v) payment of indemnification pursuant to any other section of this Agreement or the charter or Bylaws of the Company is not
made within ten days after a determination has been made that Indemnitee is entitled to indemnification, Indemnitee shall be entitled
to an adjudication in the Court of Chancery of the State of Delaware, or in any other court of competent jurisdiction, of Indemnitee’s
entitlement to such indemnification or advance of Expenses. Alternatively, Indemnitee, at Indemnitee’s option, may seek
an award in arbitration to be conducted by a single arbitrator pursuant to the Commercial Arbitration Rules of the American Arbitration
Association. Indemnitee shall commence a proceeding seeking an adjudication or an award in arbitration within 180 days following
the date on which Indemnitee first has the right to commence such proceeding pursuant to this Section 11(a); provided, however,
that the foregoing clause shall not apply to a proceeding brought by Indemnitee to enforce his or her rights under Section 6 of
this Agreement. Except as set forth herein, the provisions of Delaware law (without regard to its conflicts of laws rules) shall
apply to any such arbitration. The Company shall not oppose Indemnitee’s right to seek any such adjudication or award in
arbitration.

 

(b)               
In any judicial proceeding or arbitration commenced pursuant to this Section 11, Indemnitee
shall be presumed to be entitled to indemnification or advance of Expenses, as the case may be, under this Agreement and the Company
shall have the burden of proving that Indemnitee is not entitled to indemnification or advance of Expenses, as the case may be.
If Indemnitee commences a judicial proceeding or arbitration pursuant to this Section 11, Indemnitee shall not be required to
reimburse the Company for any advances pursuant to Section 7 of this Agreement until a final determination is made with respect
to Indemnitee’s entitlement to indemnification (as to which all rights of appeal have been exhausted or lapsed). The Company
shall, to the fullest extent not prohibited by law, be precluded from asserting in any judicial proceeding or arbitration commenced
pursuant to this Section 11 that the procedures and presumptions of this Agreement are not valid, binding and enforceable and
shall stipulate in any such court or before any such arbitrator that the Company is bound by all of the provisions of this Agreement.

 

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(c)             
If a determination shall have been made pursuant to Section 9(b) of this Agreement that Indemnitee
is entitled to indemnification, the Company shall be bound by such determination in any judicial proceeding or arbitration commenced
pursuant to this Section 11, absent a misstatement by Indemnitee of a material fact, or an omission of a material fact necessary
to make Indemnitee’s statement not materially misleading, in connection with the request for indemnification.

 

(d)             
In the event that Indemnitee is successful in seeking, pursuant to this Section 11, a judicial
adjudication of or an award in arbitration to enforce Indemnitee’s rights under, or to recover damages for breach of, this
Agreement, Indemnitee shall be entitled to recover from the Company, and shall be indemnified by the Company for, any and all
Expenses actually and reasonably incurred by him or her in such judicial adjudication or arbitration. If it shall be determined
in such judicial adjudication or arbitration that Indemnitee is entitled to receive part but not all of the indemnification or
advance of Expenses sought, the Expenses incurred by Indemnitee in connection with such judicial adjudication or arbitration shall
be appropriately prorated.

 

(e)             
Interest shall be paid by the Company to Indemnitee at the maximum rate allowed to be charged
for judgments under Delaware law for amounts which the Company pays or is obligated to pay for the period (i) commencing with
either the tenth day after the date on which the Company was requested to advance Expenses in accordance with Sections 7 or 8
of this Agreement or the 60th day after the date on which the Company was requested to make the determination of entitlement
to indemnification under Section 9(b) of this Agreement, as applicable, and (ii) and ending on the date such payment is made to
Indemnitee by the Company.

 

Section
12.               Defense
of the Underlying Proceeding.

 

(a)             
Indemnitee shall notify the Company promptly in writing upon being served with any summons,
citation, subpoena, complaint, indictment, request or other document relating to any Proceeding which may result in the right
to indemnification or the advance of Expenses hereunder and shall include with such notice a description of the nature of the
Proceeding and a summary of the facts underlying the Proceeding. The failure to give any such notice shall not disqualify Indemnitee
from the right, or otherwise affect in any manner any right of Indemnitee, to indemnification or the advance of Expenses under
this Agreement unless the Company’s ability to defend in such Proceeding or to obtain proceeds under any insurance policy
is materially and adversely prejudiced thereby, and then only to the extent the Company is thereby actually so prejudiced.

 

(b)            
Subject to the provisions of the last sentence of this Section 12(b) and of Section 12(c)
below, the Company shall have the right to defend Indemnitee in any Proceeding which may give rise to indemnification hereunder;
provided, however, that the Company shall notify Indemnitee of any such decision to defend within 15 calendar days following receipt
of notice of any such Proceeding under Section 12(a) above. The Company shall not, without the prior written consent of Indemnitee,
which shall not be unreasonably withheld or delayed, consent to the entry of any judgment against Indemnitee or enter into any
settlement or compromise which (i) includes an admission of fault of Indemnitee, (ii) does not include, as an unconditional term
thereof, the full release of Indemnitee from all liability in respect of such Proceeding, which release shall be in form and substance
reasonably satisfactory to Indemnitee, or (iii) would impose any Expense, judgment, fine, penalty or limitation on Indemnitee.
This Section 12(b) shall not apply to a Proceeding brought by Indemnitee under Section 11 of this Agreement.

 

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(c)               
Notwithstanding the provisions of Section 12(b) above, if in a Proceeding to which Indemnitee
is a party by reason of Indemnitee’s Corporate Status, (i) Indemnitee reasonably concludes, based upon an opinion of counsel
approved by the Company, which approval shall not be unreasonably withheld, that Indemnitee may have separate defenses or counterclaims
to assert with respect to any issue which may not be consistent with other defendants in such Proceeding, (ii) Indemnitee reasonably
concludes, based upon an opinion of counsel approved by the Company, which approval shall not be unreasonably withheld, that an
actual or apparent conflict of interest or potential conflict of interest exists between Indemnitee and the Company, or (iii)
if the Company fails to assume the defense of such Proceeding in a timely manner, Indemnitee shall be entitled to be represented
by separate legal counsel of Indemnitee’s choice, subject to the prior approval of the Company, which approval shall not
be unreasonably withheld, at the expense of the Company. In addition, if the Company fails to comply with any of its obligations
under this Agreement or in the event that the Company or any other person takes any action to declare this Agreement void or unenforceable,
or institutes any Proceeding to deny or to recover from Indemnitee the benefits intended to be provided to Indemnitee hereunder,
Indemnitee shall have the right to retain counsel of Indemnitee’s choice, subject to the prior approval of the Company,
which approval shall not be unreasonably withheld, at the expense of the Company (subject to Section 11(d) of this Agreement),
to represent Indemnitee in connection with any such matter.

 

Section
13.               Non-Exclusivity;
Survival of Rights; Subrogation.

 

(a)            
The rights of indemnification and advance of Expenses as provided by this Agreement shall
not be deemed exclusive of any other rights to which Indemnitee may at any time be entitled under applicable law, the charter
or Bylaws of the Company, any agreement or a resolution of the stockholders entitled to vote generally in the election of directors
or of the Board of Directors, or otherwise. Unless consented to in writing by Indemnitee, no amendment, alteration or repeal of
this Agreement or of any provision hereof shall limit or restrict any right of Indemnitee under this Agreement in respect of any
action taken or omitted by such Indemnitee in his or her Corporate Status prior to such amendment, alteration or repeal, regardless
of whether a claim with respect to such action or inaction is raised prior or subsequent to such amendment, alteration or repeal.
No right or remedy herein conferred is intended to be exclusive of any other right or remedy, and every other right or remedy
shall be cumulative and in addition to every other right or remedy given hereunder or now or hereafter existing at law or in equity
or otherwise. The assertion of any right or remedy hereunder, or otherwise, shall not prohibit the concurrent assertion or employment
of any other right or remedy.

 

(b)             
In the event of any payment under this Agreement, the Company shall be subrogated to the
extent of such payment to all of the rights of recovery of Indemnitee, who shall execute all papers required and take all action
necessary to secure such rights, including execution of such documents as are necessary to enable the Company to bring suit to
enforce such rights.

 

Section
14.               Insurance.
The Company will use its reasonable best efforts to acquire directors and officers liability insurance, on terms and conditions
deemed appropriate by the Board of Directors, with the advice of counsel, covering Indemnitee or any claim made against Indemnitee
by reason of his or her Corporate Status and covering the Company for any indemnification or advance of Expenses made by the Company
to Indemnitee for any claims made against Indemnitee by reason of his or her Corporate Status. Without in any way limiting any
other obligation under this Agreement, the Company shall indemnify Indemnitee for any payment by Indemnitee arising out of the
amount of any deductible or retention and the amount of any excess of the aggregate of all judgments, penalties, fines, settlements
and Expenses incurred by Indemnitee in connection with a Proceeding over the coverage of any insurance referred to in the previous
sentence. The purchase, establishment and maintenance of any such insurance shall not in any way limit or affect the rights or
obligations of the Company or Indemnitee under this Agreement except as expressly provided herein, and the execution and delivery
of this Agreement by the Company and Indemnitee shall not in any way limit or affect the rights or obligations of the Company
under any such insurance policies. If, at the time the Company receives notice from any source of a Proceeding to which Indemnitee
is a party or a participant (as a witness or otherwise), the Company has director and officer liability insurance in effect, the
Company shall give prompt notice of such Proceeding to the insurers in accordance with the procedures set forth in the respective
policies.

 

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Section
15.               Coordination
of Payments. The Company shall not be liable under this Agreement to make any payment of amounts otherwise indemnifiable or
payable or reimbursable as Expenses hereunder if and to the extent that Indemnitee has otherwise actually received such payment
under any insurance policy, contract, agreement or otherwise.

 

Section
16.               Duration
of Agreement; Binding Effect.

 

(a)            
This Agreement shall continue until and terminate on the later of (i) the date that Indemnitee
shall have ceased to serve as a director, officer, employee or agent of the Company or as a director, trustee, officer, partner,
manager, managing member, fiduciary, employee or agent of any other foreign or domestic corporation, real estate investment trust,
partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such person is or
was serving in such capacity at the request of the Company and (ii) the date that Indemnitee is no longer subject to any actual
or possible Proceeding (including any rights of appeal thereto and any Proceeding commenced by Indemnitee pursuant to Section
11 of this Agreement).

 

(b)           
The indemnification and advance of Expenses provided by, or granted pursuant to, this Agreement
shall be binding upon and be enforceable by the parties hereto and their respective successors and assigns (including any direct
or indirect successor by purchase, merger, consolidation or otherwise to all or substantially all of the business or assets of
the Company), shall continue as to an Indemnitee who has ceased to be a director, officer, employee or agent of the Company or
a director, trustee, officer, partner, manager, managing member, fiduciary, employee or agent of any other foreign or domestic
corporation, partnership, limited liability company, joint venture, trust, employee benefit plan or other enterprise that such
person is or was serving in such capacity at the request of the Company, and shall inure to the benefit of Indemnitee and Indemnitee’s
spouse, assigns, heirs, devisees, executors and administrators and other legal representatives.

 

(c)          
The Company shall require and cause any successor (whether direct or indirect by purchase,
merger, consolidation or otherwise) to all, substantially all or a substantial part, of the business and/or assets of the Company,
by written agreement in form and substance satisfactory to Indemnitee, expressly to assume and agree to perform this Agreement
in the same manner and to the same extent that the Company would be required to perform if no such succession had taken place.

 

(d)          The Company and Indemnitee agree that a monetary remedy for breach of this Agreement, at
some later date, may be inadequate, impracticable and difficult of proof, and further agree that such breach may cause Indemnitee
irreparable harm. Accordingly, the parties hereto agree that Indemnitee may enforce this Agreement by seeking injunctive relief
and/or specific performance hereof, without any necessity of showing actual damage or irreparable harm and that by seeking injunctive
relief and/or specific performance, Indemnitee shall not be precluded from seeking or obtaining any other relief to which Indemnitee
may be entitled. Indemnitee shall further be entitled to such specific performance and injunctive relief, including temporary
restraining orders, preliminary injunctions and permanent injunctions, without the necessity of posting bonds or other undertakings
in connection therewith. The Company acknowledges that, in the absence of a waiver, a bond or undertaking may be required of Indemnitee
by a court, and the Company hereby waives any such requirement of such a bond or undertaking.

 

    - 9 - 

     

    

 

Section
17.              Severability.
If any provision or provisions of this Agreement shall be held to be invalid, illegal or unenforceable for any reason whatsoever:
(a) the validity, legality and enforceability of the remaining provisions of this Agreement (including, without limitation, each
portion of any Section, paragraph or sentence of this Agreement containing any such provision held to be invalid, illegal or unenforceable
that is not itself invalid, illegal or unenforceable) shall not in any way be affected or impaired thereby and shall remain enforceable
to the fullest extent permitted by law; (b) such provision or provisions shall be deemed reformed to the extent necessary to conform
to applicable law and to give the maximum effect to the intent of the parties hereto; and (c) to the fullest extent possible,
the provisions of this Agreement (including, without limitation, each portion of any Section, paragraph or sentence of this Agreement
containing any such provision held to be invalid, illegal or unenforceable, that is not itself invalid, illegal or unenforceable)
shall be construed so as to give effect to the intent manifested thereby.

 

Section
18.              Identical
Counterparts. This Agreement may be executed in one or more counterparts, each of which shall for all purposes be deemed to
be an original but all of which together shall constitute one and the same Agreement. One such counterpart signed by the party
against whom enforceability is sought shall be sufficient to evidence the existence of this Agreement.

 

Section
19.              Headings.
The headings of the paragraphs of this Agreement are inserted for convenience only and shall not be deemed to constitute part
of this Agreement or to affect the construction thereof.

 

Section
20.              Modification
and Waiver. No supplement, modification or amendment of this Agreement shall be binding unless executed in writing by both
of the parties hereto. No waiver of any of the provisions of this Agreement shall be deemed or shall constitute a waiver of any
other provisions hereof (whether or not similar) nor shall such waiver constitute a continuing waiver.

 

Section
21.              Notices.
All notices, requests, demands and other communications hereunder shall be in writing and shall be deemed to have been duly given
if (i) delivered by hand and receipted for by the party to whom said notice or other communication shall have been directed, on
the day of such delivery, or (ii) mailed by certified or registered mail with postage prepaid, on the third business day after
the date on which it is so mailed:

 

(a)           
If to Indemnitee, to the address set forth on the signature page hereto.

 

(b)          
If to the Company, to:

 

Franklin BSP Capital
Corporation

c/o Benefit Street
Partners L.L.C.

9 West 57th Street,
Suite 4920

New York, NY 10019

[Attn: General Counsel]

 

or to such other address as may
have been furnished in writing to Indemnitee by the Company or to the Company by Indemnitee, as the case may be.

 

Section
22.               Governing
Law. This Agreement shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware,
without regard to its conflicts of laws rules.

 

[SIGNATURE
PAGE FOLLOWS]

 

    - 10 - 

     

    

 

IN WITNESS
WHEREOF, the parties hereto have executed this Agreement as of the day and year first above written.

 

	 	FRANKLIN
    BSP CAPITAL CORPORATION
	 	 
	 	By:	 
	 	Name:
	 	Title:
	 	 
	 	INDEMNITEE
	 	 
	 	 
	 	Name:
	 	Address:

 

[Signature Page to
Indemnity Agreement] 

 

     

     

    

 

EXHIBIT
A

 

AFFIRMATION
AND UNDERTAKING TO REPAY EXPENSES ADVANCED

 

To:The Board of Directors
of _________________________

 

Re:Affirmation and Undertaking

 

Ladies and Gentlemen:

 

This Affirmation
and Undertaking is being provided pursuant to that certain Indemnification Agreement, dated the _____ day of _______________,
2020, by and between _________________________, a Delaware corporation (the “Company”), and the undersigned Indemnitee
(the “Indemnification Agreement”), pursuant to which I am entitled to advance of Expenses in connection with [Description
of Proceeding] (the “Proceeding”).

 

Terms used
herein and not otherwise defined shall have the meanings specified in the Indemnification Agreement.

 

I am subject
to the Proceeding by reason of my Corporate Status or by reason of alleged actions or omissions by me in such capacity. I hereby
affirm my good faith belief that at all times, insofar as I was involved as a director of the Company, in any of the facts or
events giving rise to the Proceeding, I (1) did not act with bad faith or active or deliberate dishonesty, (2) did not receive
any improper personal benefit in money, property or services and (3) in the case of any criminal proceeding, had no reasonable
cause to believe that any act or omission by me was unlawful.

 

In consideration
of the advance of Expenses by the Company for reasonable attorneys’ fees and related Expenses incurred by me in connection
with the Proceeding (the “Advanced Expenses”), I hereby agree that if, in connection with the Proceeding, it is established
that (1) such Advanced Expenses are subject to the limitations and disqualifications described in the Indemnification Agreement
or (2) an act or omission by me was material to the matter giving rise to the Proceeding and (a) was committed in bad faith or
(b) was the result of active and deliberate dishonesty or (3) I actually received an improper personal benefit in money, property
or services or (4) in the case of any criminal proceeding, I had reasonable cause to believe that the act or omission was unlawful,
then I shall promptly reimburse the portion of the Advanced Expenses, together with the Applicable Legal Rate of interest thereon,
relating to the claims, issues or matters in the Proceeding as to which the foregoing findings have been established.

 

 

	 	 
	 	Name:Exhibit
10.6

 

DISTRIBUTION
REINVESTMENT PLAN

OF

FRANKLIN BSP CAPITAL CORPORATION

 

Franklin
BSP Capital Corporation, a Delaware corporation (the “Company”), hereby adopts the following plan (the
 “Plan”) with respect to cash dividends or distributions (each, a “Distribution”)
declared by its Board of Directors (the “Board of Directors”) on shares of its common stock, par value
$0.001 per share (the “Common Stock”):

 

1.                 
Unless a stockholder specifically elects to receive cash in accordance with the Plan, all Distributions hereafter declared
by the Board of Directors shall be payable in shares of Common Stock, and no action shall be required on such stockholder’s
part to receive a Distribution in shares of Common Stock. DST Systems, Inc., the plan administrator and the Company’s transfer
agent and registrar (collectively the “Plan Administrator”), will establish an account for shares of
Common Stock received pursuant to the Plan for each stockholder who has not affirmatively elected to receive Distributions in
cash (each a “Participant”). The Plan Administrator may hold each Participant’s shares of Common
Stock, together with the shares of Common Stock of other Participants in the Plan Administrator’s name or that of its nominee.

 

2.                 
Such Distributions shall be payable on such date or dates (each, a “Payment Date”) as may be
fixed from time to time by the Board of Directors to stockholders of record at the close of business on the record date(s) established
by the Board of Directors for such Distribution.

 

3.                 
With respect to each Distribution pursuant to the Plan, the Company reserves the right to either issue new shares of Common
Stock or if the Common Stock is listed on a national securities exchange, purchase shares of Common Stock in the open market for
the accounts of Participants in connection with implementation of the Plan. Unless the Company, in its sole discretion, otherwise
directs the Plan Administrator:

 

(a)              
if the Market Price (as defined below) is equal to or greater than NAV (as defined below), then the Company shall issue
shares of Common Stock at the greater of (i) NAV or (ii)  95% of the Market Price; or

 

(b)              
if the Market Price is less than the NAV, then, in the sole discretion of the Company, (i) shares of Common Stock shall
be purchased in open market transactions for the accounts of Participants to the extent practicable or (ii) the Company shall
issue shares of Common Stock at NAV.

 

The
number of shares of Common Stock to be issued to a Participant is determined by dividing the total dollar amount of the Distribution
payable to the Participant by the price at which the Company issues such shares of Common Stock pursuant to 3(a)(i), 3(a)(ii)
or 3(b)(ii), as applicable. Shares of Common Stock purchased in open market transactions pursuant to 3(b)(i) will be allocated
to a Participant based on the average purchase price, excluding any brokerage charges or other charges, of all shares of Common
Stock purchased in the open market with respect to such Distribution. “Market Price” means the market
price per share of the Common Stock at the close of regular trading on any exchange or inter-dealer quotation system that represents
the principal trading market for the shares of Common Stock (the “Principal Trading Market”) on the
Payment Date, or if no sale is reported for such day, the average of the reported bid and asked prices. “NAV”
means the net asset value per share (as estimated in good faith by the Company and rounded up to the nearest whole cent) of Common
Stock on the Payment Date.

 

     

     

    

 

4.                 
A stockholder may, however, affirmatively elect to receive such stockholder’s Distributions in cash. Except as may
otherwise be permitted by the Company in its sole discretion, the election will be effective immediately if such stockholder notifies
(i) the Company upon the stockholder’s initial subscription for shares of Common Stock or (ii) the Plan Administrator in
writing not less than 10 days prior to the record date fixed by the Board of Directors for the next Distribution; otherwise, such
election will be effective only with respect to any subsequent Distribution. Such election shall remain in effect until the stockholder
shall notify the Plan Administrator in writing of such stockholder’s withdrawal of the election, which withdrawal will be
effective immediately if such stockholder notifies the Plan Administrator in writing not less than 10 days prior to the record
date fixed by the Board of Directors for the next Distribution; otherwise, such withdrawal will be effective only with respect
to any subsequent Distribution.

 

5.                 
The Plan Administrator will confirm to each Participant each issuance or acquisition made pursuant to the Plan on such
Participant’s behalf as soon as practicable, but not later than 30 days after the date thereof. Although each Participant
may from time to time have a fractional interest (computed to three decimal places) in a share of Common Stock of the Company,
no certificates for a fractional share will be issued. However, Distributions on fractional shares will be credited to each Participant’s
account.

 

6.                 
The Plan Administrator or another agent designated by the Company will forward to each Participant any proxy solicitation
materials related to the Company and each report or other communication of the Company delivered to stockholders, and will vote
any shares of Common Stock held by it under the Plan in accordance with the instructions set forth on proxies returned to the
Company by Participants.

 

7.                 
In the event that the Company makes available to its stockholders rights to purchase additional shares of Common Stock
or other securities, the shares of Common Stock held by the Plan Administrator for each Participant under the Plan will be added
to any other shares of Common Stock held by the Participant in calculating the number of rights to be issued to the Participant.

 

8.                 
There will be no brokerage charges or other sales charges on newly-issued shares of Common Stock acquired by a stockholder
under the Plan. The Plan Administrator’s service fee, if any, and expenses for administering the Plan will be paid for by
the Company. If a Participant elects by written notice to the Plan Administrator to have the Plan Administrator sell part or all
of the shares of Common Stock held by the Plan Administrator in the Participant’s account and remit the proceeds to the
Participant, whether upon termination of the Plan by the Company, termination by a Participant of such Participant’s account
under the Plan or otherwise, the Plan Administrator shall be authorized to deduct from the proceeds a $20.00 transaction fee for
each transaction requested by a Participant, plus any applicable brokerage commission or additional administrative expenses charged
at the prevailing market rate.

 

    2

     

    

 

9.                 
The Plan Administrator will be responsible for generating or providing a Form 1099-DIV or any related tax forms associated
with any Distributions that are reinvested or paid out.

 

10.             
Each Participant may terminate such Participant’s account under the Plan by so notifying the Plan Administrator in
writing. Such termination will be effective immediately if the Participant’s notice is received by the Plan Administrator
not less than 10 days prior to the record date fixed by the Board of Directors for the next Distribution; otherwise, such termination
will be effective only with respect to any subsequent Distribution. The Plan may be terminated by the Company upon appropriate
written notice, including by public disclosure that satisfies the requirement of Regulation FD or otherwise in a filing made by
the Company with the U.S. Securities and Exchange Commission, at least 30 days prior to any record date for the payment of any
Distribution by the Company; if such notice is made fewer than 30 days prior to such record date, such termination will be effective
immediately following the Payment Date for such Distribution. Upon any termination of the Plan by the Company or by a Participant
of such Participant’s account under the Plan, the Plan Administrator will cause whole shares of Common Stock held for the
Participant under the Plan to be credited to the Participant in book-entry form with the Company’s transfer agent and a
cash adjustment for any fractional shares to be paid to the Participant at the Market Price per share of Common Stock at the close
of regular trading on the Principal Trading Market on the date of such termination.

 

11.             
These terms and conditions may be amended or supplemented by the Company at any time but, except when necessary or appropriate
to comply with applicable law or the rules, regulations or policies of the Securities and Exchange Commission or any other regulatory
authority, by appropriate written notice at least 30 days prior to the effective date thereof. The amendment or supplement shall
be deemed to be accepted by each Participant unless, prior to the effective date thereof, the Plan Administrator receives written
notice of the termination of such Participant’s account under the Plan. Any such amendment or supplement may include an
appointment by the Plan Administrator in its place and stead of a successor agent under these terms and conditions, with full
power and authority to perform all or any of the acts to be performed by the Plan Administrator under the terms and conditions
agreed upon by the Company. Upon any such appointment of any agent for the purpose of receiving Distributions, the Company shall
be authorized to pay to such successor agent, for each Participant’s account, all Distributions payable on shares of Common
Stock held in the Participant’s name or under the Plan for retention or application by such successor agent as provided
in these terms and conditions.

 

12.             
The Plan Administrator will at all times act in good faith and use its best efforts within reasonable limits to ensure
its full and timely performance of all services to be performed by it under the Plan and to comply with applicable law, but assumes
no responsibility and shall not be liable for loss or damage due to errors unless such error is caused by the Plan Administrator’s
negligence, bad faith, or willful misconduct or that of its employees or agents.

 

13.             
These terms and conditions of the Plan shall be governed by and construed in accordance with the laws of the State of Delaware,
without regard to any conflict of laws principals or rules thereof, to the extent such principals would require or permit the
application of the laws of another jurisdiction, and the Investment Company Act of 1940, as amended (the “1940 Act”).
In the event of a conflict, the applicable provisions of the 1940 Act shall control.

 

    3

     

    

 

Effective
Date: [●], 2020

 

    4

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