Company: RWT-PA
Filing Date: 2025-01-15
Form Type: 424B5
Source: 0001104659-25-003632
Chunk: 11

Company: REDWOOD TRUST INC
Filing Date: 2025-01-15
Form: 424B5
Chunk 11
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RISK FACTORS</div>

Investing in the notes being offered by this prospectus supplement involves a high degree of risk. Before deciding whether to invest in the notes, you should consider carefully the risk factors described below, the risk factors incorporated herein by reference from our Annual Report on Form 10-K for the year ended December 31, 2023, as updated by our subsequent Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, and the risk factors contained in any supplement to this prospectus supplement that we have authorized for use in connection with this offering. If any of these risks actually occur, it may materially harm our business, financial condition, operating results or cash flow. As a result, the market price of our common stock, and, in turn, the trading price of the notes, could decline, and you could lose part or all of your investment. Additional risks and uncertainties that are not yet identified or that we think are immaterial may also materially harm our business, operating results and financial condition and could result in a complete loss of your investment.

Risks Related to the Notes and to this Offering

The notes are effectively subordinated to any of our existing and future secured debt and structurally subordinated to the liabilities of our subsidiaries.

The notes will be our senior
unsecured obligations and will rank equal in right of payment with our existing and future senior unsecured indebtedness, including our
guarantee of the 2025 Notes, the 2027 Notes and the 2029 Notes, and senior in right of payment to any existing and future indebtedness
that is contractually subordinated to the notes. The notes, however, will be effectively subordinated to our existing and future secured
indebtedness to the extent of the value of the collateral securing such indebtedness. As of September 30, 2024, on a consolidated
basis, we and our subsidiaries had $3.16 billion in outstanding secured indebtedness and $662 million in outstanding senior unsecured
indebtedness, in each case exclusive of trade and other payables. The provisions of the indenture governing the notes will not prohibit
us from incurring additional indebtedness, including secured indebtedness, in the future. Consequently, in the event of a bankruptcy,
liquidation, dissolution, reorganization or similar proceeding with respect to us, the holders of any secured indebtedness will be entitled
to proceed directly against the collateral securing such indebtedness. Therefore, such collateral will not be