Company: RWT-PA
Filing Date: 2025-01-15
Form Type: 8-K
Source: 0001104659-25-003630
Chunk: 0

Company: REDWOOD TRUST INC
Filing Date: 2025-01-15
Form: 8-K
Item: Item 2.02
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Item 2.02. Results of Operations and Financial Condition.

Redwood Trust, Inc. is disclosing certain preliminary results
of operations for the quarter ended December 31, 2024.

Preliminary Estimate of Book Value Per Common
Share at December 31, 2024

Although our financial results for the fourth
quarter of 2024 are not yet finalized, on a preliminary basis we estimate, after giving effect to the payment of our fourth quarter common
stock dividend of $0.18 per share (which was a 5.9% increase relative to the third quarter 2024), book value per common share to be in
the range of $8.40 to $8.50 at December 31, 2024, down approximately 2.75% to 4.00% compared to $8.74 at September 30, 2024.
During the fourth quarter of 2024, the positive impact of increased volume in our operating businesses was more than offset by the net
negative impact of higher benchmark interest rates which negatively impacted valuations in our securities portfolio and additional credit-related
valuation declines on our bridge loans. We estimate that at December 31, 2024 our recourse leverage ratio was in the range of
2.4x to 2.5x and our unrestricted cash balance was $248 million. In response to the Los Angeles wildfires, we continue to assess the impact to our business and we are currently monitoring the affected
areas. While the fires are ongoing and the full extent of their total impact is yet to be determined, based on our assessments to date,
we have not identified circumstances that we believe would have a material adverse impact on our business.

Estimated book value per common share at December 31,
2024 is based on 132,519,579 common shares issued and outstanding as of such date. Shares of common stock outstanding do not include a
total of approximately 79 million shares of common stock (i) issuable in respect of vested and unvested deferred stock units, and
restricted stock units; (ii) issuable in respect of unvested performance stock units (assuming maximum vesting under the performance-based
vesting formula), (iii) reserved for issuance under our equity and incentive compensation plans, (iv) reserved for issuance
under our at-the-market offering program, (v) reserved for issuance under our direct stock purchase and dividend reinvestment plans,
(vi) issuable upon conversion or exchange of our outstanding convertible