Redwood Trust Announces Pricing of Public Offering of Preferred Stock

Redwood Trust, Inc. (“Redwood”) (NYSE: RWT) today announced the pricing of an underwritten public offering of 2,600,000 shares of its 10.00% Series A Fixed-Rate Reset Cumulative Redeemable Preferred Stock (the “Series A Preferred Stock”) with a liquidation preference of $25.00 per share, resulting in gross proceeds of $65.0 million. In connection with the offering, Redwood has granted the underwriters a 30-day option to purchase up to an additional 390,000 shares of Series A Preferred Stock, solely to cover over-allotments. Redwood intends to apply to list the Series A Preferred Stock on the New York Stock Exchange under the symbol "RWT PRA." The offering is expected to close on January 18, 2023, subject to the satisfaction of customary closing conditions.

Redwood intends to use the net proceeds from this offering for general corporate purposes, which may include (i) the repurchase or repayment of all or a portion of our 4.75% convertible senior notes due 2023, (ii) the repurchase or repayment of a portion of our 5.625% convertible senior notes due 2024, our 5.75% exchangeable senior notes due 2025, or our 7.75% convertible senior notes due 2027, and/or (iii) funding of our business and investment activity, which may include funding our residential and business purpose lending mortgage banking businesses, acquiring mortgage-backed securities for our investment portfolio, funding other long-term portfolio investments, and funding strategic acquisitions and investments.

Morgan Stanley & Co. LLC, J.P. Morgan Securities LLC, RBC Capital Markets, LLC, UBS Securities LLC, Wells Fargo Securities, LLC, Goldman Sachs & Co. LLC, Keefe, Bruyette & Woods, A Stifel Company, Piper Sandler & Co. and Raymond James & Associates, Inc. are acting as joint book-running managers for the proposed offering. BTIG, LLC, Barclays Capital Inc. and JMP Securities, A Citizens Company, are acting as co-managers for the proposed offering.

The public offering will be made pursuant to an automatic shelf registration statement on Form S-3 that was filed by Redwood with the Securities and Exchange Commission (“SEC”) and became effective on March 4, 2022. A preliminary prospectus supplement and accompanying prospectus relating to and describing the terms of the offering have been filed with the SEC and are available on the SEC’s website at www.sec.gov. Copies of the preliminary prospectus supplement and accompanying prospectus may be obtained by contacting: