Exhibit 10.5
REDWOOD TRUST, INC.
AMENDED AND RESTATED 2014 INCENTIVE AWARD PLAN

PERFORMANCE AWARD AGREEMENT (CASH – TIME-VESTING)

        This Performance Award Agreement (Cash) (the “Award Agreement”) is made
effective as of August 5, 2020 (the “Grant Date”), between Redwood Trust, Inc.,
a Maryland corporation (the “Company”) and [_______] (the “Participant”).
         WHEREAS, the Company maintains the Redwood Trust, Inc. 2014 Incentive
Award Plan (the “Plan”), which provides for the issuance of Performance Awards
(as defined in the Plan); and
        WHEREAS, all capitalized terms used herein without definition shall have
the meanings ascribed to such terms in the Plan.
        NOW, THEREFORE, in consideration of the mutual covenants contained
herein and for other good and valuable consideration, the receipt of which is
hereby acknowledged, the Participant and the Company do hereby agree as follows:
        1. Grant of Award.
(a) For good and valuable consideration, effective as of the date hereof, the
Company hereby grants to the Participant a Performance Award (the “Award”) upon
the terms and conditions set forth in this Award Agreement (including any
exhibits attached hereto).
(b) The amount of the Award (the “Award Amount”) shall be $[______].
2. Vesting of Award.
(a)General Vesting. Subject to Sections 2(b), 4 and 5 hereof, the Award shall
vest as follows. The date on which an Award, or portion thereof, vests is
referred to as a “Vesting Date”. The Award shall vest with respect to [25% of
the Award on August 4, 2021 and as to 75% of the Award on August 4, 2023] /
[one-third of the Award on each of August 4, 2021, August 4, 2022 and August 4,
2023], in each case subject to the Participant’s continued employment through
such Vesting Date.

(b)Qualifying Termination.

(i) If the Participant experiences a Qualifying Termination, the Award will vest
in full as of immediately prior to such Qualifying Termination (to the extent
the Award remains outstanding as of such termination).

(iii) For purposes of this Award Agreement, a “Qualifying Termination” means a
Termination of Service as an Employee by the Company without Cause or due to the
Participant’s death or Disability. In addition, a “Qualifying Termination” means
a Termination of Service as an Employee (i) prior to a Change in Control by the
Participant for Good Reason, but only if the Participant is party to an
employment agreement with the Company that contains a definition of Good Reason
or (ii) on or following a Change in Control for Good Reason (regardless of
whether the Participant is party to an employment agreement with the Company
that contains a definition of Good Reason).

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(iv) For purposes of this Award Agreement, “Cause” shall have such meaning
defined in the Participant’s employment agreement with the Company or, if no
such agreement exists or does exist but does not contain such a definition,
shall mean (i) the Participant’s material failure to substantially perform the
reasonable and lawful duties of his or her position for the Company, which
failure shall continue for thirty (30) days after written notice thereof by the
Company to the Participant; (ii) acts or omissions constituting gross
negligence, recklessness or willful misconduct on the Participant’s part in
respect of the performance of his or her duties, his or her fiduciary
obligations or otherwise relating to the business of the Company; (iii) the
habitual or repeated neglect of the Participant’s duties; (iv) the Participant’s
conviction of a felony; (v) the Participant’s theft or embezzlement, or
attempted theft or embezzlement, of money or tangible or intangible assets or
property of the Company or its employees, customers, clients, or others having
business relations with the Company; (vi) any act of moral turpitude by the
Participant injurious to the interest, property, operations, business or
reputation of the Company; or (vii) the Participant’s unauthorized use or
disclosure of trade secrets or confidential or proprietary information
pertaining to the Company’s business.

(v) For purposes of this Award Agreement, “Disability” shall mean the
Participant is “disabled” within the meaning of Section 409A of the Code.

(vi) For purposes of this Award Agreement, “Good Reason” shall have such meaning
defined in the Participant’s employment agreement with the Company or, if no
such agreement exists or does exist but does not contain such a definition,
shall mean the occurrence, without the Participant’s express written consent, of
any one or more of the following events: (i) a material reduction in the
Participant’s base salary or wages or a material reduction by the Company in the
value of the Participant’s total compensation package (salary, wages, bonus
opportunity, equity incentive award opportunity and benefits) if such a
reduction is not made in proportion to an across-the-board reduction for all
similarly-situated service providers of the Company; or (ii) the relocation of
the Participant’s principal Company office to a location more than twenty-five
(25) miles from its location as of the date hereof, except for required travel
on the Company’s business to the extent necessary to fulfill the Participant’s
obligations to the Company. Notwithstanding the foregoing, the Participant will
not be deemed to have resigned for Good Reason unless (1) the Participant
provides the Company with written notice setting forth in reasonable detail the
facts and circumstances claimed by the Participant to constitute Good Reason
within ninety (90) days after the date of the occurrence of any event that you
know or should reasonably have known to constitute Good Reason, (2) the Company
fails to cure such acts or omissions within thirty (30) days following its
receipt of such notice, and (3) the effective date of the Participant’s
termination for Good Reason occurs no later than thirty (30) days after the
expiration of the Company’s cure period.

        3. Payment of Award. Any Award or portion thereof that vests in
accordance with Section 2 hereof shall be paid to the Participant within 60 days
following the applicable Vesting Date. The Award, or portion thereof, that
becomes payable pursuant to the terms of the Plan and this Award Agreement shall
be payable in cash.
4. Forfeiture. If the Participant incurs a Termination of Service prior to an
applicable Vesting Date for any reason other than a Qualifying Termination, the
Award, to the extent not theretofore vested), will thereupon automatically be
forfeited, terminated and cancelled, and the Participant shall forfeit all
right, entitlement and interest thereto and in such unvested Award, or portion
thereof.
        

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        5. [Reserved.]
        6. At-Will Employment. This Award Agreement is not an employment
contract and nothing in this Award Agreement shall be deemed to create in any
way whatsoever any obligation of the Participant to continue as an Employee,
Consultant or Director of the Company or on the part of the Company to continue
the employment or other service relationship of the Participant with the
Company. It is understood and agreed to by the Participant that the Award and
participation in the Plan does not alter the at-will nature of the Participant’s
relationship with the Company (subject to the terms of any separate employment
agreement the Participant may have with the Company). The at-will nature of the
Participant’s relationship with the Company can only be altered by a writing
signed by both the Participant and the Chief Executive Officer or the President
of the Company.
        7. Notices. Any notice required or permitted under this Award Agreement
shall be deemed given when delivered personally, or when deposited in a United
States Post Office, postage prepaid, addressed, as appropriate, to the
Participant either at the Participant’s address set forth below or such other
address as the Participant may designate in writing to the Company, and to the
Company: Attention: General Counsel, at the Company’s address or such other
address as the Company may designate in writing to the Participant.
        8. Failure to Enforce Not a Waiver. The failure of the Company to
enforce at any time any provision of this Award Agreement shall in no way be
construed to be a waiver of such provision or of any other provision hereof.
        9. Restrictive Covenants; Arbitration. The Participant agrees and
acknowledges that the Participant’s right to receive and retain the Award and
any payments hereunder is subject to and conditioned upon the Participant’s
continued compliance with the restrictive covenants contained in Exhibit A
attached hereto. In addition, the Participant agrees and acknowledges that any
dispute arising with respect to this Award and this Award Agreement will be
subject to the Alternative Dispute Resolution provisions set forth in an
Employment and Confidentiality Agreement by and between the Participant and the
Company.
10. Existing Agreements. This Award Agreement does not supersede nor does it
modify any existing agreements between the Participant and the Company.
11. Incorporation of Plan; Deferred Compensation Plan. The Plan is incorporated
by reference and made a part of this Award Agreement, and this Award Agreement
is subject to all terms and conditions of the Plan as in effect from time to
time. This Award shall not constitute Compensation for purposes of the Company’s
Executive Deferred Compensation Plan, as amended.
12. Amendments. This Award Agreement may be amended or modified at any time by
an instrument in writing signed by the parties hereto.
13. Withholding. The Company shall withhold, or cause to be withheld,
compensation otherwise vesting or issuable under this Award in satisfaction of
any applicable withholding tax obligations. To the extent that any Federal
Insurance Contributions Act tax withholding obligations arise in connection with
the Award prior to the applicable vesting date, the Administrator shall
accelerate the payment of a portion of the Award sufficient to satisfy (but not
in excess of) such tax withholding obligations and any tax withholding
obligations associated with any such accelerated payment, and the Administrator
may withhold such amounts in satisfaction of such withholding obligations.
14. Section 409A. Notwithstanding anything to the contrary in this Award
Agreement, this Award Agreement is intended to comply with or be exempt from
Section 409A of the Code and this Award Agreement and the Plan shall be
interpreted in a manner consistent with such intent. Notwithstanding anything to
the contrary in this Award Agreement, no amounts shall be paid to the
        

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Participant under this Award Agreement during the six (6)-month period following
the Participant’s “separation from service” (within the meaning of Section 409A
of the Code) to the extent that the Administrator determines that the
Participant is a “specified employee” (within the meaning of Section 409A of the
Code) at the time of such separation from service and that paying such amounts
at the time or times indicated in this Award Agreement would be a prohibited
distribution under Section 409A(a)(2)(B)(i) of the Code. If the payment of any
such amounts is delayed as a result of the previous sentence, then on the first
business day following the end of such six (6)-month period (or such earlier
date upon which such amount can be paid under Section 409A of the Code without
being subject to such additional taxes), the Company shall pay to the
Participant in a lump-sum all amounts that would have otherwise been payable to
the Participant during such six (6)-month period under this Award Agreement.
15. Performance-Based Compensation. This Award is not intended to constitute
qualified performance-based compensation for purposes of the Plan or Section
162(m) of the Code.
16. Miscellaneous.
(a)Governing Law. The laws of the State of Maryland shall govern the
interpretation, validity, administration, enforcement and performance of the
terms of this Award Agreement regardless of the law that might be applied under
principles of conflicts of laws.
(b)Counterparts. This Award Agreement may be executed in any number of
counterparts, any of which may be transmitted by facsimile or e-mail, and each
of which shall be deemed to be an original, but all of which together shall be
deemed to be one and the same instrument.
(c)Entire Agreement. This Award Agreement, including the exhibits attached
hereto, constitutes the entire agreement among the parties hereto pertaining to
the subject matter hereof and supersedes all prior agreements, understandings,
negotiations and discussions, whether oral or written, of the parties hereto.
(d)Headings. The headings contained in this Award Agreement are for the
convenience of the parties only. They are not operative terms of this Award
Agreement, and are not intended to define or limit in any way the terms of this
Award Agreement.

[Signature page follows]

        
        

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IN WITNESS WHEREOF, the parties hereto have executed this Award Agreement as of
the date and year first above written.

REDWOOD TRUST, INC.  PARTICIPANT

By:        
Its:  [Name]
          
         

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EXHIBIT A

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RESTRICTIVE COVENANTS

1. Non-Disparagement. While providing services to the Company and thereafter,
the Participant agrees not to make negative comments or statements about, or
otherwise criticize or disparage, in any format or through any medium, the
Company or any entity controlled by, controlling or under common control with
the Company (“Affiliates”) or any of the officers, directors, managers,
employees, services, operations, investments or products of the Company or any
of its Affiliates. For purposes of the foregoing sentence, disparagement shall
include, but not be limited to, negative comments or statements intended or
reasonably likely to be harmful or disruptive to a person’s or entity’s
respective business, business reputation, business operations, or personal
reputation.

2. Non-Solicitation. While providing services to the Company and, for a period
of one (1) year thereafter, the Participant shall not directly or indirectly
solicit, induce, or encourage any employee or consultant of any member of the
Company and its subsidiaries or Affiliates to terminate their employment or
other relationship with the Company and its Affiliates or to cease to render
services to any member of the Company and its subsidiaries or Affiliates and the
Participant shall not initiate discussion with any such person for any such
purpose or authorize or knowingly cooperate with the taking of any such actions
by any other individual or entity. While providing services to the Company and
thereafter, the Participant shall not use any trade secret of the Company or its
subsidiaries or Affiliates to solicit, induce, or encourage any customer,
client, vendor, or other party doing business with any member of the Company and
its subsidiaries or Affiliates to terminate its relationship therewith or
transfer its business from any member of the Company and its subsidiaries or
Affiliates and the Participant shall not initiate discussion with any such
person for any such purpose or authorize or knowingly cooperate with the taking
of any such actions by any other individual or entity.

3. Confidentiality. The Participant shall keep secret and retain in the
strictest confidence all confidential, proprietary and non-public matters,
tangible or intangible, of or related to the Company, its stockholders,
subsidiaries, affiliates, successors, assigns, officers, directors, attorneys,
fiduciaries, representatives, employees, licensees and agents including, without
limitation, trade secrets, business strategies and operations, seller,
counterparty and customer lists, manufacturers, vendors, material suppliers,
financial information, personnel information, legal advice and counsel obtained
from counsel, information regarding litigation, actual, pending or threatened,
research and development, identities and habits of employees and agents and
business relationships, and shall not disclose them to any person, entity or any
federal, state or local agency or authority, except as may be required by law;
provided that, in the event disclosure is sought as a result of any subpoena or
other legal process initiated against the Participant, the Participant shall
immediately give the Company’s General Counsel written notice thereof in order
to afford the Company an opportunity to contest such disclosure (such notice to
be delivered to: Redwood Trust, Inc., One Belvedere Place, Suite 300, Mill
Valley, CA, 94941, Attn: General Counsel).

4. Exceptions. Nothing herein shall prohibit or restrict the Participant from:
(i) making any disclosure of information required by law; (ii) providing
information to, or testifying or otherwise assisting in any investigation or
proceeding brought by, any federal or state regulatory or law enforcement agency
or legislative body, any self-regulatory organization, or the Company’s Human
Resources, Legal, or Compliance Departments; (iii) testifying, participating in
or otherwise assisting in a proceeding relating to an alleged violation of the
Sarbanes-Oxley Act of 2002, any federal, state or municipal law relating to
fraud or any rule or regulation of any self-regulatory organization; or (iv)
filing a charge with, reporting possible violations to, or participating or
cooperating with the Securities and Exchange Commission or any other federal,
state or local regulatory body or law enforcement agency (each a “Governmental
Agency”). Nothing herein shall be construed to limit the Participant’s right to
receive an award for any

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information provided to a Governmental Agency in relation to any whistleblower,
anti-discrimination, or anti-retaliation provisions of federal, state or local
law or regulation. In addition, notwithstanding the foregoing obligations,
pursuant to 18 U.S.C. § 1833(b), the Participant understands and acknowledges
that the Participant shall not be held criminally or civilly liable under any
U.S. federal or state trade secret law for the disclosure of a trade secret that
is made: (1) in confidence to a federal, state, or local government official,
either directly or indirectly, or to an attorney, and solely for the purpose of
reporting or investigating a suspected violation of law; or (2) in a complaint
or other document filed in a lawsuit or other proceeding, if such filing is made
under seal and protected from public disclosure. Nothing in this Agreement is
intended to conflict with 18 U.S.C. § 1833(b) or create liability for
disclosures of trade secrets that are expressly allowed by 18 U.S.C. § 1833(b).