BayFirst Financial (BAFN) offers 4.1M shares at $3.50 in rights offering for $14.4M gross proceeds

Public offering price | $3.50 | $14,378,252 | Sales agent fees(1) | $0.07 | $287,565 | Proceeds to us, before expenses | $3.43 | $14,090,687

Record holders of our common stock as of the record date have the non-transferable ability to subscribe to purchase shares of our common stock. The subscription price of $3.50 per share was determined by our Board of Directors based on factors including, but not limited to, our recent and current financial performance, potential losses in our loan portfolio, the likely cost of capital from other sources, the price at which new investors and current shareholders might be willing to purchase stock, our need for capital, and the desire to provide an opportunity to our shareholders to participate in the offering on the same terms as investors in our recent private placement.

You may submit a subscription for one share for each share you owned as of the record date. However, if you purchased shares in our recent private placement, you may not participate in this offering.

We intend to use the net proceeds to improve the capital levels of the Company and the Bank, fund incremental allowance for credit losses, and to support the continued growth of the Bank and return it to profitability.

Assuming no outstanding and vested stock options or warrants are exercised prior to the expiration of the offering, we expect that there will be 8,216,144 shares of our common stock outstanding immediately after completion of the offering.

On April 28, 2026, we closed a private placement of convertible preferred stock at an effective conversion price of $3.50 per share common stock. We are conducting this offering to permit our current shareholders to also purchase shares at the same price.

On April 28, 2026, the Company entered into a Securities Purchase Agreement with Kenneth R. Lehman and other investors (each, a “Purchaser” and collectively, the “Purchasers”). Pursuant to the Securities Purchase Agreement, on that same date, the Company issued and sold to the Purchasers, in the aggregate:

(i) 4,000 shares (the “Series D Shares”) of the Company’s Mandatorily Convertible Cumulative Perpetual Preferred Stock, Series D, no par value (the “Series D Preferred Stock”), at a purchase price of $10,000 per Series D Share; and

(ii) 4,000 shares (the “Series E Shares” and together with the Series D Shares, the “Preferred Shares”) of the Company’s Mandatorily Convertible Cumulative Perpetual Preferred Stock, Series E, no par value, at a purchase price of $10,000 per Series E Share,

in a private placement (the “Private Placement”), for gross proceeds of $80,000,000.

If either of the Stockholder Approvals are not obtained at the initial shareholder meeting called by the Company, then the Company will include proposals to approve such Stockholder Approvals at a meeting of its shareholders no less than once in each subsequent three-month period beginning on the date of such previous shareholder meeting until such approval is obtained. If the Company does not obtain the Stockholder Approvals by December 15, 2026, it will be obligated to pay an 11% cumulative dividend on the Preferred Shares.

If the Company fails to file the registration statement or have it declared effective by certain deadlines, if the registration statement ceases to remain effective, subject to specified grace periods, or if the Company fails to satisfy the current public information requirement of Rule 144(c) (1) under the Securities Act of 1933, as amended (the “Securities Act”), then the Company will pay monthly liquidated damages to the holders of Registrable Securities in an amount 1.0% of the aggregate purchase price paid by such Purchaser pursuant to the Securities Purchase Agreement for any unregistered Registrable Securities then held by such Holder, subject to certain caps and limitations.

Also effective on April 28, 2026, the Company, the Bank, and Mr. Rogers entered into an Employment Agreement. The Employment Agreement’s initial term will expire on May 1, 2029. On May 1, 2027, and each subsequent May 1st, the Employment Agreement shall automatically be extended for an additional one-year period unless any party provides notice of non-renewal. Mr. Rogers will receive a minimum annual salary of $450,000. He will also receive an automobile allowance, reimbursement for country club memberships, and a term life insurance policy. He is also eligible to participate in any of the Bank’s or the Company’s employee benefit plans and programs. He is also entitled to receive specific stock and cash incentive payments based on his and the Bank’s performance.

The Employment Agreement subjects Mr. Rogers to two-year, post-termination, customer and employee non-solicitation obligations. Upon a “change in control,” Mr. Rogers will be entitled to receive a cash payment equal to 2.99 times his then current base salary and target bonus for that year.

We are offering up to 4,108,072 shares of our common stock. ... You may submit a subscription for one share for each share you owned as of the record date. However, if you purchased shares in our recent private placement, you may not participate in this offering. ... $3.50 per share, payable in cash.

We estimate that the net proceeds that we will receive from this offering, after deducting sales agent commissions and the estimated offering expenses payable by us, will be approximately $13.8 million. However, this offering is being conducted on a “best-efforts” basis, so the sales agent is not required to sell any specific number or dollar amount of securities but will use their best efforts to sell the securities offered.

We intend to use the net proceeds, including commissions, to improve the capital levels of the Company and the Bank, fund incremental allowance for credit losses, and to support the continued growth of the Bank and return it to profitability.

In July 2025, our Board of Directors suspended payments of dividends to common and preferred shareholders.

On April 28, 2026, we sold $80,000,000 in convertible preferred stock at a price equivalent to, the $3.50 per share offering price.

We intend to use the net proceeds to improve the capital levels of the Company and the Bank, fund incremental allowance for credit losses, and to support the continued growth of the Bank and return it to profitability.

In the event this offering is not fully subscribed for, the Company will offer to sell to Kenneth R. Lehman, at the offering price, any and all shares otherwise unsold in this offering.

However, if you purchased shares in our recent private placement, you may not participate in this offering.

The Board of Directors does not make any recommendation to shareholders regarding subscribing for shares in this offering.