Company: RWT-PA
Filing Date: 2025-01-15
Form Type: 424B5
Source: 0001104659-25-003632
Chunk: 78

Company: REDWOOD TRUST INC
Filing Date: 2025-01-15
Form: 424B5
Chunk 78
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 as actual ownership of the underlying securities by the optionholder. The rules further provide when
securities constructively owned by a person will be considered to be actually owned for the further application of such attribution provisions.
To determine whether a person holds or would hold capital stock in excess of the 9.8% ownership limit, a person will be treated as owning
not only shares of capital stock actually owned, but also any shares of capital stock attributed to that person under the attribution
rules described above. Accordingly, a person who directly owns less than 9.8% of the shares outstanding may nevertheless be in violation
of the 9.8% ownership limit.

Any acquisition or transfer
of shares of capital stock or warrants that would cause us to be disqualified as a REIT or that would create a direct or constructive
ownership of shares of capital stock in excess of the 9.8% ownership limit, or result in the shares of capital stock being beneficially
owned, within the meaning of Section 856(a) of the Code, by fewer than 100 persons, determined without any reference to any
rules of attribution, or result in our being closely held within the meaning of Section 856(h) of the Code, will be null
and void, and the intended transferee will acquire no rights to those shares or warrants. These restrictions on transferability and ownership
will not apply if our board of directors determines that it is no longer in our best interests to continue to qualify as a REIT.

If any purported transfer
of shares of capital stock or warrants results in a purported transferee owning, directly or constructively, shares in excess of the
9.8% ownership limit due to the unenforceability of the transfer restrictions described above, the amount of shares causing the purported
transferee to violate the 9.8% ownership limit will constitute excess securities. Excess securities will be transferred by operation
of law to Redwood Trust as trustee for the exclusive benefit of the person or persons to whom the excess securities are ultimately transferred,
until such time as the purported transferee retransfers the excess securities. While the excess securities are held in trust, a holder
of such securities will not be entitled to vote or to share in any dividends or other distributions with respect to such securities and
will not be entitled to exercise or convert such securities into shares of capital stock. Excess securities may be transferred by the
purported transferee to any person (if such transfer would not result in excess