Preheat grill to 350° to 400° (medium-high) heat. Toss peppers and onions with olive oil, thyme, and 1/2 tsp. salt.
Grill pepper mixture and sausage at the same time, covered with grill lid. Grill pepper mixture, turning occasionally, 8 to 10 minutes or until wilted. Grill sausage 5 minutes on each side or until done.
Bring remaining 1/2 tsp. salt, chicken broth, and 1/2 cup water to a boil in a 3-qt. saucepan; slowly stir in grits, reduce heat, and simmer 12 minutes or until thickened and creamy, stirring often. Remove from heat, and stir in butter and next 3 ingredients.
Coarsely chop peppers and onions, and slice sausage into 1-inch pieces. Serve sausage-and-pepper mixture over hot cooked grits.
Note: We tested with Johnsonville Irish O'Garlic Sausage.
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