Company: RWT-PA
Filing Date: 2025-03-03
Form Type: S-3ASR
Source: 0001104659-25-019828
Chunk: 65

Company: REDWOOD TRUST INC
Filing Date: 2025-03-03
Form: S-3ASR
Chunk 65
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 the asset tests at the close of any quarter, we will not lose our status as a REIT for failure to satisfy the asset tests at
the end of a later quarter solely by reason of changes in asset values. If we fail to satisfy an asset test because we acquire securities
or other property during a quarter (including as a result of an increase in our interest in any partnership), we may cure this failure
by disposing of sufficient nonqualifying assets within 30 days after the close of that quarter. We believe that we have maintained, and
we intend to maintain, adequate records of the value of our assets to ensure compliance with the asset tests. If we fail to cure any
noncompliance with the asset tests within the 30-day cure period, we would cease to qualify as a REIT unless we are eligible for certain
relief provisions discussed below.

Certain relief provisions
may be available to us if we discover a failure to satisfy the asset tests described above after the 30-day cure period. Under these
provisions, we will be deemed to have met the 5% and 10% asset tests if the value of our nonqualifying assets (i) does not exceed the
lesser of (a) 1% of the total value of our assets at the end of the applicable quarter or (b) $10,000,000, and (ii) we dispose of the
nonqualifying assets or otherwise satisfy such tests within (a) six months after the last day of the quarter in which the failure to
satisfy the asset tests is discovered or (b) the period of time prescribed by Treasury Regulations to be issued. For violations of any
of the asset tests due to reasonable cause and not due to willful neglect and that are, in the case of the 5% and 10% asset tests, in
excess of the de minimis exception described above, we may avoid disqualification as a REIT after the 30-day cure period by taking
steps including (1) the disposition of sufficient nonqualifying assets, or the taking of other actions, which allow us to meet the asset
tests within (a) six months after the last day of the quarter in which the failure to satisfy the asset tests is discovered or (b) the
period of time prescribed by Treasury Regulations to be issued, (2) paying a tax equal to the greater of (a) $50,000 or (b) the U.S. federal
cor