AMENDMENT TO EMPLOYMENT AGREEMENT

THIS AMENDMENT TO EMPLOYMENT AGREEMENT (this “Agreement”), is entered into as of
the 16th day of January 2008 by and between HAROLD F. ZAGUNIS (the “Executive”)
and REDWOOD TRUST, INC. , a Maryland Corporation (the “Company”).

WHEREAS, the Executive and the Company have entered into an Amended and Restated
Employment Agreement dated as of February 22, 2005 (as subsequently amended, the
“Employment Agreement”); and

WHEREAS, the Executive and the Company desire to enter into this Agreement for
purposes of amending the Employment Agreement to increase the Base Salary
specified in the Employment Agreement, effective January 1, 2008;

NOW, THEREFORE, for good and valuable consideration, the receipt and adequacy
which is hereby acknowledged, the Executive and the Company hereby agree that
Section 3(a) of the Employment Agreement is hereby amended to add the following
sentence at the end of Section 3(a):  

Effective January 1, 2008, the Base Salary shall be $400,000.

IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by its
duly authorized officer, and the Executive has executed this Agreement, as of
the date first above written.
 
REDWOOD TRUST, INC.
   
 
 
By:
/s/ George E. Bull, III
 
Name: George E. Bull, III
 
Title:   Chief Executive Officer
       
 
 
HAROLD F. ZAGUNIS
       
/s/  Harold F. Zagunis

 
 
 

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