Redwood Trust Prices $60.0 Million Senior Notes Offering

Redwood Trust, Inc. (NYSE: RWT; “Redwood” or the “Company”) today announced the pricing of an underwritten public offering of $60,000,000 aggregate principal amount of its 9.125% senior notes due 2029 (the “Notes”). The offering is expected to close on January 22, 2024, subject to the satisfaction of certain closing conditions.

Redwood intends to apply to list the Notes on the New York Stock Exchange under the symbol “RWTN” and, if the application is approved, trading of the Notes on the New York Stock Exchange is expected to begin within 30 days after the Notes are first issued. The Notes have received an investment grade rating of BBB from Egan-Jones Ratings Company, an independent, unaffiliated rating agency.

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

The Notes will be senior unsecured obligations of Redwood. The Notes will bear interest at a rate equal to 9.125% per year, payable quarterly in arrears on March 1, June 1, September 1 and December 1 of each year, beginning on June 1, 2024. The Notes will mature on March 1, 2029. The Notes will be issued in minimum denominations of $25 and integral multiples of $25 in excess thereof or in units.

Redwood will have the right to redeem the Notes, in whole or in part, at its option at any time on or after March 1, 2026 at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date. Upon the occurrence of a change of control, Redwood will be required to make an offer to repurchase all outstanding Notes at a price equal to 101% of the principal amount of the Notes, plus accrued and unpaid interest to, but excluding, the repurchase date.