Company: RWT-PA
Filing Date: 2025-08-22
Form Type: 424B5
Source: 0001104659-25-081925
Chunk: 111

Company: REDWOOD TRUST INC
Filing Date: 2025-08-22
Form: 424B5
Chunk 111
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The following discussion addresses the rules governing U.S. federal income taxation of the ownership and disposition of our common stock received upon conversion of the notes by Non-U.S. Holders. These rules are complex, and no attempt is made herein to provide more than a brief summary of such rules. Accordingly, the discussion does not address all aspects of U.S. federal income taxation and does not address other U.S. federal, state, local or non-U.S. tax consequences that may be relevant to a Non-U.S. Holder in light of its particular circumstances. We urge Non-U.S. Holders to consult their tax advisors to determine the impact of U.S. federal, state, local and non-U.S. income and other tax laws and any applicable tax treaty on the ownership and disposition of shares of our common stock received upon conversion of the notes, including any reporting requirements.

Distributions Generally

Distributions (including any taxable stock distributions and any deemed distributions resulting from certain adjustments, or failures to make adjustments, to the conversion rate of the notes, as described

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above under “Material U.S. Federal Income Tax Considerations — Federal Income Tax Considerations for Holders of the Notes and Our Common Stock — Taxation of Non-U.S. Holders of the Notes — Constructive Distributions”) that are neither attributable to gains from sales or exchanges by us of USRPIs nor designated by us as capital gain dividends (except as described below) will be treated as dividends of ordinary income to the extent that they are made out of our current or accumulated earnings and profits. Such distributions ordinarily will be subject to withholding of U.S. federal income tax at a 30% rate or such lower rate as may be specified by an applicable income tax treaty, unless the distributions are treated as effectively connected with the conduct by the Non-U.S. Holder of a trade or business within the United States (and, if required by an applicable income tax treaty, the Non-U.S. Holder maintains a permanent establishment in the United States to which such dividends are attributable). Under certain treaties, however, lower withholding rates generally applicable to dividends do not apply to dividends from a REIT. In addition, any portion of the dividends paid to Non-U.S. Holders that are treated as excess inclusion income will not be eligible for exemption from the 30% withholding tax or a reduced treaty rate. See “Material U.S. Federal Income Tax Considerations — Taxation of the Company —