Company: RWT-PA
Filing Date: 2025-01-15
Form Type: 424B5
Source: 0001104659-25-003632
Chunk: 12

Company: REDWOOD TRUST INC
Filing Date: 2025-01-15
Form: 424B5
Chunk 12
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 available for satisfaction
of any amounts owed under our unsecured indebtedness, including the notes, until such secured indebtedness is satisfied in full.

Our subsidiaries will not
guarantee the notes. Accordingly, the notes will also be structurally subordinated to all existing and future unsecured and secured liabilities
and preferred equity of our subsidiaries, including trade creditors and our subsidiary’s obligations under the 2025 Notes. In the
event of a bankruptcy, liquidation, dissolution, reorganization or similar proceeding with respect to any such subsidiary, we, as a common
equity owner of such subsidiary, and, therefore, holders of our debt, including holders of the notes, will be subject to the prior claims
of such subsidiary’s creditors, including trade creditors, and preferred equity holders. As of September 30, 2024, the aggregate
amount of secured liabilities of our subsidiaries was $3.01 billion and the aggregate amount of unsecured liabilities of our subsidiaries
was $170 million, including the 2025 Notes, in each case excluding trade and other payables and excluding intercompany liabilities, and
our operating subsidiaries had no outstanding preferred equity. The provisions of the indenture governing the notes will not prohibit
our subsidiaries from incurring additional indebtedness or issuing preferred equity in the future.

In the ordinary course of
business, we and our subsidiaries may seek to procure new secured and/or unsecured financing capacity to fund our mortgage banking operations,
repay existing debt, make long-term portfolio investments, increase our unrestricted cash and liquidity, fund strategic acquisitions
and investments, or for other purposes.

<div align='center'>S-7</div>

Our significant level of indebtedness and liabilities could limit cash flow available for our operations, expose us to risks that could adversely affect our business, financial condition and results of operations and impair our ability to satisfy our obligations under the notes.

We have now and, following
the consummation of this offering, will continue to have a significant amount of indebtedness and liabilities. As of September 30,
2024, our total consolidated liabilities (excluding asset-backed securities issued by consolidated securitization entities, for which
we are not liable) was $4.18 billion. We will incur significant additional indebtedness if and when we sell the notes. We may also incur
additional indebtedness to meet future financing needs. Our indebtedness could have significant negative consequences for our business,
results of operations and financial condition, including:

| · | increasing                                                     
 our vulnerability to