DEF 14A of Redwood Trust Inc, Apr 1, 2025

DEF 14A of Redwood Trust Inc

Filed Apr 1, 2025 · FY20240000930236-25-000012

Open on EDGAR

  1. ITEM 1 — ELECTION OF DIRECTORS

    ITEM 1 — ELECTION OF DIRECTORS The nominees for the nine director positions are set forth below. In the event we are advised prior to the Annual Meeting that any nominee will be unable to serve or for good cause will not serve as a director if elected at the Annual Meeting, the proxies will cast votes for any person who shall be nominated by the present Board of Directors to fill such directorship. The nominees listed below are currently serving as directors of Redwood. If a quorum is present, the election of each nominee as a director requires a majority of the votes cast with respect to such nominee at the Annual Meeting. For purposes of the election of directors, a majority of the votes cast means that the number of votes cast “for” a nominee for election as a director exceeds the number of votes cast “against” that nominee. Cumulative voting in the election of directors is not permitted. Abstentions and broker non-votes will not be counted as votes cast and will have no effect on the results of the vote in the election of directors. In accordance with Redwood’s Bylaws and its Policy Regarding Majority Voting, any incumbent nominee for director must offer to resign from the Board if he or she fails to receive the required number of votes for re-election. The Governance and Nominating Committee will consider any such offer of resignation and will recommend to the Board whether to accept the offer to resign. The Board will decide whether to accept any such offer to resign and will publicly disclose its decision.

  2. Nominees to Board of Directors

    Nominees to Board of Directors

  3. Nominees to Board of Directors

    | Name | Current Position with Redwood | | Greg H. Kubicek | Chair of the Board | | Christopher J. Abate | Director and Chief Executive Officer | | Doneene K. Damon | Director | | Armando Falcon | Director | | Douglas B. Hansen | Director | | Debora D. Horvath | Director | | Georganne C. Proctor | Director | | Dashiell I. Robinson | Director and President | | Faith A. Schwartz | Director |

  4. Nominees to Board of Directors

    THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS A VOTE FOR THE NOMINEES IDENTIFIED ABOVE. Set forth below are summaries of the experience, qualifications, attributes and skills, of each of the nominees for election at the Annual Meeting, as well as certain biographical information regarding each of these individuals.

  5. Nominees to Board of Directors

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  6. Nominees to Board of Directors

    For each nominee for election as a director, set forth below and on the following pages is biographical information regarding the nominee, as well as factors supporting the Board of Directors’ conclusion to nominate the nominee for election to continue to serve as a director.

  7. Nominees to Board of Directors

    | | Greg H. Kubicek, age 68, is Chair of the Board, having previously served as Vice Chair of the Board from December 2020 to May 2022. Mr. Kubicek has been a director of Redwood since 2002. After serving as Founder and CEO of The Holt Group, Inc. for 41 years, Mr. Kubicek was appointed CEO of GHK Enterprises, Inc. following Sekisui House’s acquisition of The Holt Group, Inc., a real estate company and its associated funds that purchase, develop, own, and manage | | manage real estate properties. Mr. Kubicek has also served as Chair of the Board of Cascade Corporation, an international manufacturing corporation. Mr. Kubicek holds an A.B. in Economics from Harvard College. | | | The Board of Directors concluded that Mr. Kubicek should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Leadership attributes •Management and entrepreneurial experience •Expertise and experience in the real estate development industry •Experience and expertise in the property management business •Professional and educational background | |

  8. Nominees to Board of Directors

    | | Christopher J. Abate, age 45, has served as Chief Executive Officer since May 2018 and as a director since December 2017. Mr. Abate has been employed with Redwood since April 2006, previously serving as Redwood’s President from July 2016 to May 2018, Chief Financial Officer from March 2012 to August 2017, and Controller from January 2009 to March 2013. From October 2019 to December 2021, Mr. Abate served as Chair of the Board of Structured Finance Association | | Association. Before joining Redwood, Mr. Abate was employed by PricewaterhouseCoopers LLP. He holds a B.A. in accounting and finance from Western Michigan University, an M.B.A. from the University of California at Berkeley and Columbia University. | | | The Board of Directors concluded that Mr. Abate should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Leadership attributes and management experience, including experience as Chief Executive Officer, President, Chief Financial Officer, and Controller of Redwood •Skill and experience in managing balance sheet exposures and managing risks •Skill and experience in executing capital markets transactions •Finance and accounting expertise and experience •Professional and educational background | |

  9. Nominees to Board of Directors

    | | Doneene K. Damon, age 57, has been a director of Redwood since November 2023. Ms. Damon is a practicing attorney as a Director of Richards, Layton & Finger, P.A. (“RLF”), a multidisciplinary law firm based in Wilmington, Delaware, which she joined in 1992. Ms. Damon served as the President of RLF from 2019 to 2022, and currently serves as chair of the firm’s Corporate Trust and Agency Services Group. Ms. Damon also currently serves on the Board of Directors of Brown Advisory Delaware | | Advisory Delaware Trust Company and as a board member of the Structured Finance Association, the Forum of Executive Women and the Delaware Business Roundtable. Ms. Damon’s commitment to public service and nonprofit organizations includes current or past service as a member of Delaware’s Judicial Nominating Commission, the Delaware Compensation Commission, and the Delaware Prosperity Partnership. Ms. Damon previously served as the Chair of the Board of Directors of Christiana Care Health System, Inc. and Health Services, Inc., and she currently serves on the Board of Directors of St. Joseph’s University and is a member of the Board of Visitors of Temple University’s Beasley School of Law. Ms. Damon holds a B.S. in Accounting from St. Joseph’s University in Philadelphia and a J.D. from Temple University’s School of Law. | | | The Board of Directors concluded that Ms. Damon should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Leadership attributes and management experience •Skill and experience in structured finance transactions •Expertise and experience in legal and regulatory matters •Expertise and experience relating to corporate and institutional governance •Professional and educational background | |

  10. Nominees to Board of Directors

    | | Armando Falcon, age 64, has been a director of Redwood since March 2021. Mr. Falcon is CEO of Falcon Capital Advisors LLC, a management consulting firm based in Washington, DC, that provides strategic advice and technical assistance to financial services companies, mortgage industry companies, and government agencies on matters involving process reengineering, project management, regulatory compliance, and data analytics, which he founded in 2007. He previously served | | served as the Director of the Office of Federal Housing Enterprise Oversight, and as the General Counsel for the Committee on Banking and Financial Services of the U.S. House of Representatives. Mr. Falcon currently serves on the Board of Directors of the Structured Finance Association. Mr. Falcon also serves as an advisor to the Board of Directors of the National Association of Hispanic Real Estate Professionals. Mr. Falcon holds a B.A. from St. Mary’s University, an M.P.P. from Harvard University, and a J.D. from the University of Texas. | | | The Board of Directors concluded that Mr. Falcon should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Leadership attributes and management experience •Experience in government service and financial regulation •Expertise and experience in the real estate finance and financial services industries •Expertise and experience relating to corporate and institutional governance •Professional and educational background | |

  11. Nominees to Board of Directors

    | | Douglas B. Hansen, age 67, is a founder of Redwood, and served as Redwood’s President from 1994 through 2008. Mr. Hansen retired from his position as President of Redwood at the end of 2008. Mr. Hansen has been a director of Redwood since 1994. Mr. Hansen serves on the Board of Directors of Four Corners Property Trust, Inc., a publicly traded real estate investment trust. Mr. Hansen also serves on the board of River of Knowledge, a not-for-profit institution. Mr. Hansen holds | | holds an A.B. in Economics from Harvard College and an M.B.A. from Harvard Business School. | | | The Board of Directors concluded that Mr. Hansen should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Leadership attributes and management experience, including experience as Redwood’s President from its founding in 1994 through 2008 •Skill and experience in investing in real estate-related assets and managing portfolios of such investments •Skill and experience in managing balance sheet exposures and managing risks •Skill and experience in executing capital markets transactions •Experience in finance and accounting matters •Professional and educational background | |

  12. Nominees to Board of Directors

    | | Debora D. Horvath, age 70, has been a director of Redwood since 2016. Ms. Horvath is Principal of Horvath Consulting LLC, which she founded in 2010. Ms. Horvath served as an Executive Vice President for JP Morgan Chase & Co. from 2008 to 2010. Ms. Horvath served as an Executive Vice President and Chief Information Officer for Washington Mutual, Inc. (“WaMu”) from 2004 to 2008. In addition to being the technology leader at WaMu, Ms. Horvath was responsible for the Enterprise | | Enterprise Project Office and was Chair of WaMu’s Environmental Council. Ms. Horvath, a 25-year veteran from General Electric Company (“GE”), served 12 years as a Senior Vice President and Chief Information Officer for the GE insurance businesses. Ms. Horvath has been a Director of StanCorp Financial Group, Inc. since 2013. She was a director of the Federal Home Loan Bank of Seattle from 2012 to January 2014. Ms. Horvath holds a B.A. in Business Administration from Baldwin Wallace University and is a graduate of GE’s Financial Management Program (FMP). | | | The Board of Directors concluded that Ms. Horvath should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Leadership attributes and management experience •Experience as a chief information officer •Expertise and experience relating to information technology and technology risk management •Accounting and finance experience •Expertise and experience relating to institutional governance •Professional and educational background | |

  13. Nominees to Board of Directors

    | | Georganne C. Proctor, age 68, has been a director of Redwood since March 2006. Ms. Proctor is the former Chief Financial Officer of TIAA-CREF, and served in that position from June 2006 to July 2010. Additionally, Ms. Proctor served jointly as Chief Financial Officer and Executive Vice President for Enterprise Integration at TIAA-CREF from January 2010 to July 2010. From July 2010 to October 2010, she continued to serve as Executive Vice President for Enterprise Integration | | Integration at TIAA-CREF. From 2003 to 2005, Ms. Proctor was Executive Vice President of Golden West Financial Corporation, a thrift institution. From 1994 to 1997, Ms. Proctor was Vice President of Bechtel Group, a global engineering firm, and also served as its Senior Vice President and Chief Financial Officer from 1997 to 2002 and as a director from 1999 to 2002. From 1991 to 1994, Ms. Proctor served as finance director of certain divisions of The Walt Disney Company, a diversified worldwide entertainment company. Ms. Proctor previously served as Chair of Avantax Inc.’s Board of Directors from July 2019 to November 2023. She also served on the Board of Directors of Sculptor Capital Management, Inc. from 2011 to 2021, Kaiser Aluminum Corporation from 2006 to 2009 and SunEdison, Inc. from 2013 to 2017. Ms. Proctor holds a B.S. in Business Management from the University of South Dakota and an M.B.A. from California State University East Bay. | | | The Board of Directors concluded that Ms. Proctor should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Management experience •Expertise as a chief financial officer •Expertise and experience in the banking, insurance, and investment management industries •Professional and educational background | |

  14. Nominees to Board of Directors

    | | Dashiell I. Robinson, age 45, has served as Redwood’s President since December 2017 and as a director since August 2021. Prior to joining Redwood in September 2017, Mr. Robinson was employed at Wells Fargo Securities, serving as the Head of Mortgage Finance within the Asset-Backed Finance Group. In that role, Mr. Robinson led a team of banking professionals responsible for financing and distributing an array of residential mortgage products, and serving a broad suite of | | of the firm's operating and investing clients. Prior to his employment at Wells Fargo, Mr. Robinson was employed within the Structured Credit Products Group at Wachovia Capital Markets from 2001 to 2008, serving in banking, structuring and risk mitigation roles. Mr. Robinson also serves as a member of the Board of Directors of the Jewish Community Center of San Francisco. Mr. Robinson holds a B.A. in English from Georgetown University. | | | The Board of Directors concluded that Mr. Robinson should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Leadership attributes and management experience, including experience as President and Executive Vice President of Redwood •Expertise and experience in the real estate finance and financial services industries •Skill and experience investing in mortgages and other real estate-related assets and managing portfolios of such investments •Skill and experience in executing capital markets and structured finance transactions •Professional and educational background | |

  15. Nominees to Board of Directors

    | | Faith A. Schwartz, age 64, has been a director of Redwood since March 2021. Ms. Schwartz is the Founder and CEO of Housing Finance Strategies, LLC, a professional services and advisory practice focusing on capital markets, rating agencies, and mortgage modernization and innovation, which she founded in 2016. Ms. Schwartz currently serves on the boards of several privately held mortgage industry-focused companies, including Class Valuation LLC. From June 2019 to June 2024, | | 2024, Ms. Schwartz served on the Board of Directors of Gateway First Bank. From 2013 to 2016, Ms. Schwartz served as Senior Vice President of Federal Practice of CoreLogic, Inc., a provider of property information, insight, analytics and data-enabled solutions. She is also the founder of HOPE NOW Alliance, a public-private initiative launched in 2007 to seek solutions for American families facing foreclosure during the Great Recession. Ms. Schwartz also previously served as Senior Vice President of Government, Housing, and Industry at Option One Mortgage Corporation, a subsidiary of H&R Block, from 2003 to 2007 and as Director of Alternative Markets and Director of National Sales at Freddie Mac between 1997 and 2003. From October 2021 to October 2023, Ms. Schwartz served on the Consumer Advisory Board for the Consumer Finance Protection Bureau (CFPB). She also previously served on the Federal Reserve Board’s Consumer Advisory Council. In 2010, Ms. Schwartz founded HOPE LoanPort, a technology non-profit organization that helps families reach and sustain their goal of homeownership. She started her career at Dominion Bancshares Mortgage Company as Vice President of Capital Markets and Wholesale Lending. Ms. Schwartz holds a B.S. from Shippensburg State College and an M.B.A. from the University of Pittsburgh. | | | The Board of Directors concluded that Ms. Schwartz should be nominated to continue to serve as a director on account of, among other things, the following experience, qualifications, attributes, and skills: •Leadership attributes and management experience •Expertise and experience in the real estate finance industry and the use of technology within this industry •Expertise and experience in the banking and financial services industries •Professional and educational background | |

  16. DIRECTOR COMPENSATION

    DIRECTOR COMPENSATION Information on our non-employee director cash compensation paid (or currently scheduled to be paid) during the annual periods commencing in May 2023, May 2024, and May 2025, is set forth in the tables below. Non-employee director cash compensation is paid quarterly, in arrears.

  17. DIRECTOR COMPENSATION

    | Non-Employee Director Cash Compensation | | | | | Annual Period Commencing May 1, | | | | 2023 and 2024 | 2025 | | Annual Retainer * | $90,000 | $100,000 | | Retainer for Service as a Committee Member (per Committee)** | $12,500 | $12,500 | | ———— | | | | * The Chairs of the Audit Committee and the Governance and Nominating Committee each receive an additional annual cash retainer of $20,000. The Chair of the Compensation Committee receives an additional annual cash retainer of $30,000. The additional annual cash retainer payable to the Chair of the Board of the Directors is currently $120,000 and will increase to $135,000 for the annual period commencing May 2025. | | | | ** Non-employee directors who are members of Board Committees receive a retainer for their service on each Committee and do not receive Committee meeting attendance fees. In cases where a non-employee director is formally invited to participate in a Committee meeting of which he or she is not a member, he or she will be paid $2,000 per meeting for in-person attendance and $1,000 per meeting for telephonic attendance. | | |

  18. DIRECTOR COMPENSATION

    After submission of appropriate documentation on a timely basis, non-employee directors are also reimbursed for reasonable out-of-pocket expenses incurred in attending Board and committee meetings, as well as for their and, in some cases, their guests’ attendance at other Redwood-related meetings or events. Non-employee directors may also be reimbursed for out-of-pocket expenses incurred in attending conferences or educational seminars that relate to their Board service and are approved by the Chair of the Governance and Nominating Committee. Non-employee directors are also granted deferred stock units (“DSUs”), or comparable equity-based awards, each year at the time of the annual meeting of stockholders. The number of DSUs granted is determined by dividing the dollar value of the grant by the closing price of Redwood’s common stock on the NYSE on the day of grant (and rounding to the nearest whole share amount). In May 2024, non-employee directors received an annual DSU award with a grant date value of $125,000. On the 2025 Annual Meeting date, non-employee directors who are re-elected will receive an annual grant of vested DSUs for the May 2025 to May 2026 annual period determined by dividing $130,000 by the closing price of Redwood’s common stock on the meeting date. Non-employee directors may also be granted equity-based awards upon their initial election to the Board. These initial and annual DSU grants are fully vested upon grant, and they are generally subject to a mandatory three-year holding period. Dividend equivalent rights on DSUs are generally paid in cash to directors on each dividend distribution date. In November 2024, following a review of director compensation by the Compensation Committee and Governance and Nominating Committee, with the assistance of the Compensation Committee’s independent compensation consultant, Semler Brossy Consulting Group, LLC (“Semler Brossy”), the Board of Directors approved certain changes to the compensation program for non-employee directors for the May 2025 to May 2026 annual compensation cycle, as described below. In connection with this review, Semler Brossy conducted an independent review of Redwood’s non-employee director compensation program at the request of the Compensation Committee. The review conducted by Semler Brossy included a comparison against non-employee director compensation at the companies that comprise Redwood's executive compensation peer group. The changes to the program, effective beginning with the May 2025 to May 2026 annual period, are intended to keep Redwood’s total average annual compensation for non-employee directors at or near the compensation peer group median. Further detail regarding the executive compensation peer group is provided on pages 56 - 57 of this Proxy Statement under the heading “Executive Compensation in 2024 — Compensation Peer Group for 2024.” In particular, the Board approved the following changes, in each case effective beginning with the May 2025 to May 2026 annual period: an increase to the annual cash retainer for Board service from $90,000 to $100,000 (an increase of $10,000); an increase in the value of the annual equity award grant for Board service from $125,000 to $130,000 (an increase of $5,000); and an increase to the annual cash retainer for service as Board Chair from $120,000 to $135,000 (an increase of $15,000). Each director may elect to defer receipt of cash compensation or dividend equivalent rights through Redwood’s Executive Deferred Compensation Plan. Cash balances in the Executive Deferred Compensation Plan are unsecured liabilities of Redwood and are utilized by Redwood as available capital to fund investments and operations. Based on each director’s election, deferred compensation can either be deferred into a cash account and earn a rate of return that is equivalent to 120% of the applicable long-term federal rate published by the IRS compounded monthly or be deferred into deferred stock units which will, among other things, entitle them to receive dividend equivalent rights related to those units. Each year the Compensation Committee and Governance and Nominating Committee review Redwood’s compensation of non-employee directors with the assistance of the Compensation Committee’s independent compensation consultant. Any changes to non-employee director compensation recommended by these Committees are subject to review and approval by the Board. These Committees intend to complete their annual review of Redwood’s non-employee director compensation prior to year-end in 2025, when updated comparative compensation data will be available. Any changes to non-employee director compensation that are approved by the Board following this 2025 review may increase or decrease non-employee director compensation for the May 2025 to May 2026 annual period and/or May 2026 to May 2027 annual period from the amounts set forth in the “Non-Employee Director Cash Compensation” table on the preceding page. The following table provides information on non-employee director compensation for the 2024 calendar year. Director compensation is set by the Board and is subject to change. Directors who are employed by Redwood do not receive any compensation for their Board activities and do not appear in the following table.

  19. Non-Employee Director Compensation — 2024

    Non-Employee Director Compensation — 2024

  20. Non-Employee Director Compensation — 2024

    | Current Non-Employee Directors | Fees Earned or Paid in Cash ($)(1) | Stock Awards ($)(2)(3) | All Other Compensation ($) | Total ($) | | Doneene K. Damon | $115,000 | $124,999 | — | $239,999 | | Armando Falcon | $135,000 | $124,999 | — | $259,999 | | Douglas B. Hansen | $98,000 | $124,999 | — | $222,999 | | Debora D. Horvath | $135,000 | $124,999 | — | $259,999 | | Greg H. Kubicek | $235,000 | $124,999 | — | $359,999 | | Georganne C. Proctor | $145,000 | $124,999 | — | $269,999 | | Faith A. Schwartz | $115,000 | $124,999 | — | $239,999 |

  21. Non-Employee Director Compensation — 2024

    _____________________________ (1)Fees earned are based on the non-employee director compensation policy in place for 2024: (i) annual cash retainer of $90,000; (ii) additional annual retainer for the Chair of the Board of $120,000; (iii) additional annual cash retainer for Audit Committee Chair and Governance and Nominating Committee Chair of $20,000 and for Compensation Committee Chair of $30,000; (iv) invitational committee fees of $2,000 (in person) and $1,000 (telephonic); and (v) an annual committee retainer of $12,500 per committee. (2)Stock awards consisted of grants of vested DSUs. The value of DSUs awarded was determined in accordance with FASB Accounting Standards Codification Topic 718. Information regarding the assumptions used to value grants of DSUs is provided in Note 21 to our consolidated financial statements included in Redwood’s Annual Report on Form 10-K filed on March 3, 2025. The value of dividend equivalent rights associated with DSUs was taken into account in establishing the value of these DSUs and previously granted DSUs. Therefore, dividend equivalent rights payments made during 2024 to non-employee directors are not considered compensation or other amounts reported in the table above. (3)As of December 31, 2024, the aggregate number of stock awards/DSUs outstanding for each then-serving non-employee director was as follows: Doneene K. Damon had 37,033 vested DSUs, Armando Falcon had 54,942 vested DSUs, Douglas B. Hansen had 53,914 vested DSUs; Debora D. Horvath had 102,579 vested DSUs; Greg H. Kubicek had 466,842 vested DSUs; Georganne C. Proctor had 227,941 vested DSUs; and Faith A. Schwartz had 54,942 vested DSUs. Additional information regarding ownership of shares of common stock/DSUs by non-employee directors is set forth on page 29 of this Proxy Statement. The following table provides information on deferred stock unit distributions in the form of common stock to non-employee directors from our Executive Deferred Compensation Plan in 2024. Deferred stock units distributed represent compensation previously granted or deferred in prior years and were reported as director compensation in those prior years.

  22. Non-Employee Director Compensation — 2024

    | Current Non-Employee Directors | DSUs Distributed in 2024 (#)(1) | Aggregate Value of DSUs Distributed in 2024 ($)(2) | | Armando Falcon | 10,054 | $64,044 | | Douglas B. Hansen | 10,054 | $64,044 | | Debora Horvath | 27,528 | $160,677 | | Faith A. Schwartz | 10,054 | $64,044 |

  23. Non-Employee Director Compensation — 2024

    (1)Mr. Falcon, Mr. Hansen, Ms. Horvath, and Ms. Schwartz’s 2024 DSU distributions included annual grants awarded in 2021. In addition, Ms. Horvath’s 2024 DSU distributions also included directors fees earned in 2022 which she elected to defer into DSUs under Redwood’s Executive Deferred Compensation Plan. (2)The aggregate value of DSUs distributed is calculated by multiplying the number of DSUs distributed by the fair market value of Redwood common stock on the date of distribution.

  24. Compensation Committee

    Compensation Committee The Compensation Committee (the “Committee”) is committed to providing disclosure within this CD&A that gives insight into the process by which it arrives at executive compensation determinations and the underlying rationales. Among other things, this CD&A describes: ▪The Committee’s process for reviewing and determining the elements of the compensation of the Chief Executive Officer (“CEO”) and of the other executive officers. ▪The rationale for the different elements of the executive officers’ compensation and Redwood’s compensation philosophy, objectives, and methodology for peer comparisons. ▪The metrics and goals used for performance-based compensation and factors taken into account in the Committee’s determination of whether those metrics and goals were satisfied. ▪The severance and change of control payments that executive officers may become entitled to receive under certain circumstances. ▪The role of the Committee’s independent compensation consultant. The Committee generally meets at least four times annually and, over the course of an annual period, reviews Redwood’s compensation philosophy and its executive compensation plans and programs. After taking into account various factors and analyses, including those described in this CD&A, input from its independent compensation consultant, feedback from stockholders obtained during ongoing outreach efforts, and the outcome of recent stockholder advisory votes on executive compensation (commonly referred to as “Say-on-Pay” votes), the Committee makes compensation determinations it believes are appropriate in light of its executive compensation objectives.

  25. Stockholder Feedback

    | Section II - Executive Compensation in 2024 | | | | | ➢ | Redwood’s 2024 Performance | | | ➢ | Elements of Compensation in 2024 | | | ➢ | Process for Compensation Determinations for 2024 | | | ➢ | Compensation Peer Group for 2024 | | | ➢ | 2024 Base Salaries | | | ➢ | 2024 Performance-Based Annual Bonus Compensation | | | ➢ | Performance-Based Annual Bonuses Earned for 2024 | | | ➢ | 2024 Long-Term Equity-Based Incentive Awards | | | ➢ | Vesting and Mandatory Holding Periods for 2024 Long-Term Equity-Based Incentive Awards | | | ➢ | Pay-for-Performance Outcomes from Long-Term Equity-Based Incentive Awards |

  26. Redwood’s 2024 Performance

    Redwood’s 2024 Performance Overall, 2024 presented a challenging market and operating environment for Redwood and its closest industry peers. Significant volatility in key benchmark interest rates over the course of the year resulted in below-target performance on an absolute basis compared to Committee-established targets. On a relative basis, 2024 bvTSR and 2024 ROE were above certain peers and below others, as illustrated within the preceding “Executive Summary of CD&A” under the heading “Annual Financial Performance – 2024” on page 36 of this Proxy Statement. As further detailed within this Compensation Discussion and Analysis, Redwood’s annual financial performance for 2024 was below the targets established by the Committee, which drove below-target annual bonus realization for Redwood’s CEO and other executive officers. ▪2024 Annual Financial Performance •GAAP return on common equity (“ROE”) was 4.1%. •Non-GAAP EAD ROE was 6.4%. ◦Non-GAAP EAD ROE is a non-GAAP performance measure that is defined and described, and is reconciled to ROE based on GAAP financial results, in Annex A to this Proxy Statement. •Book value TSR was 5.7%. ◦Book value TSR (also referred to as book value total shareholder return, or “bvTSR”) for a designated period represents the period change in GAAP book value per common share plus dividends declared per common share in the period. •Redwood paid $0.67 per share in common stock dividends in 2024. ◦Redwood’s common stock dividend increased to $0.18 per share in the fourth quarter of 2024, a 12.5% increase from the fourth quarter of 2023. ▪2024 Strategic and Operational Achievements •Leading into 2024, the Company began implementing a number of strategies meant to support performance in 2024 and beyond, including: enhancing capital and operational efficiency; expanding its product sets; diversifying distribution channels; and expanding relationships with bank counterparties. Accordingly, a key goal for executive management in 2024 was to execute on the objectives, preparation and foundation to support these strategic initiatives. Actions taken in 2024 to further strategic, operational and risk-management objectives had both near- and long-term benefits and management continues to focus on forward-looking initiatives and actions that are designed to positively impact future returns. •A detailed review of strategic and operational achievements in 2024 is set forth within the preceding “Executive Summary of CD&A” under the heading “2024 Strategic and Operational Achievements” on pages 37-39 of this Proxy Statement and additional information regarding achievement of the company-wide goals is set forth below under the heading “Performance-Based Annual Bonuses Earned for 2024–Individual Performance Component of 2024 Annual Bonuses” on pages 63-65 of this Proxy Statement.

  27. Elements of Compensation in 2024

    Elements of Compensation in 2024 In 2024, cash compensation for Redwood’s executive officers included a base salary and a performance-based annual bonus. Annual bonuses for 2024 were determined based on company financial performance and on each executive officer’s individual performance. For each executive officer, the Committee established a target annual bonus amount at the beginning of 2024 that would be earned if Redwood’s financial performance met Committee-established targets and the executive officer’s individual performance merited target-level payment. In particular, one portion of each executive officer’s annual bonus was determined based on company financial performance (referred to in this CD&A as the Company performance component of target bonus or Company performance or financial performance bonus), and another portion of each executive officer’s annual bonus was determined based on individual performance (referred to in this CD&A as the individual performance component of target bonus or individual performance bonus). The Committee generally intends that the base salary and annual bonus target for each executive officer to be appropriate in comparison to a market-based median level, after taking into account factors such as the executive officer’s role and responsibilities, competitive factors, and internal equity. In addition, the Committee believes that performance-based bonuses for each executive officer should have adequate upside so that total annual compensation actually earned may reach the top-quartile of the market-based level for strong performance. The market-based levels used by the Committee during 2024 were determined with the assistance of the Committee’s independent compensation consultant. The process included reviewing compensation practices of peer companies selected by the Committee (referred to in this CD&A as the compensation peer group). Further details regarding the compensation peer group and practices for comparisons to this peer group are provided on pages 56-57 within this CD&A under the heading “Compensation Peer Group for 2024.” For 2024, the Committee established the Company performance component of the annual bonus for each executive officer such that half of this component would be realized based on Redwood’s 2024 “Adjusted ROE” and the other half of this component would be realized based on Redwood’s 2024 “Adjusted EAD ROE”. Adjusted ROE and Adjusted EAD ROE are each non-GAAP performance measures that are defined and described on pages 58-59 within this CD&A under the heading “2024 Performance-Based Annual Bonus Compensation.” Furthermore, for 2024, the Committee established an Adjusted ROE financial performance target of 11.5% and an Adjusted EAD ROE performance target of 6.5%. With respect to long-term equity-based compensation, the Committee generally makes annual year-end awards to executive officers in amounts, and subject to terms and vesting conditions, that provide an incentive to create long-term stockholder value and align the interests of executive officers with the interests of long-term stockholders. These year-end awards are intended to provide performance-based compensation opportunities at levels that will be effective in retaining valued and productive executives. In determining the size of annual year-end long-term equity-based compensation opportunities, the Committee uses the same or similar considerations as are applied when setting salaries and target annual bonus opportunities, with the value actually delivered/realized being a result of subsequent performance. For 2024, the value of long-term equity-based compensation granted at year-end to executive officers was determined after taking into account the Committee’s philosophy that: ◦Competitive pressure on executive officer compensation levels from higher-paying related market sectors should be addressed through the value of long-term equity-based awards. Annual target cash compensation amounts are generally intended to be appropriate in comparison to a median range of the compensation peer group, while long-term equity-based awards may be targeted above the median when justified by performance, experience, or the scope of the individual’s role. The value of long-term equity-based awards may also take into account each executive officer’s individual performance. ◦The terms and vesting conditions of long-term equity-based awards should result in realized compensation for executive officers that correlates with long-term stockholder value creation (through dividend distributions and share-price growth) over a minimum of three years. Executive officers are also provided with other benefits that are also available to all eligible employees of Redwood on a substantially similar basis. These benefits, which are further described below on pages 72-74 within this CD&A, include standard health and welfare benefits and the ability to participate in Redwood’s tax-qualified 401(k) plan and Employee Stock Purchase Plan. In addition, executive officers may participate in Redwood’s Executive Deferred Compensation Plan and are eligible for a concierge medical benefit. An illustration of the elements of the CEO’s target compensation at the outset of 2024, including base salary, annual bonus target, and long-term equity-based compensation is set forth under the heading “Elements of CEO’s Target Compensation Structure – Outset of 2024” in the Executive Summary of CD&A on page 35 of this Proxy Statement.

  28. Compensation Peer Group for 2024

    Compensation Peer Group for 2024 As in prior years, in 2024 the Committee asked its independent compensation consultant to conduct a market pay analysis with respect to the compensation of Redwood’s executive officers. For 2024, Semler Brossy’s market pay analysis relied primarily on publicly disclosed executive compensation data from the compensation peer group. The Committee may also consider supplemental data that provides insight into executive compensation practices at competitors that are externally managed and, therefore, do not generally disclose comprehensive compensation data for their named executive officers, as well as private companies and divisions of larger public companies for which individual compensation data are not publicly disclosed. Certain of the publicly-traded REITs that Redwood competes with for mortgage-industry talent are externally managed and do not disclose comprehensive executive compensation information and certain peers may not disclose information for officers with responsibilities comparable to all of Redwood’s executive officers. The Committee considers the use of a market-based compensation analysis important for validating competitive positioning in attracting and retaining executive talent. Each year, to prepare for conducting the competitive pay analysis, the Committee, after consultation with its independent compensation consultant, designates a compensation peer group using a pre-defined process and objective industry and size criteria that is intended to include companies with which Redwood competes for business or for executive talent. The process and objective criteria used to select the 2024 compensation peer group (which was used in the 2024 competitive pay analysis) is detailed below.

  29. Compensation Peer Group for 2024

    | Step 1: | Begin with a broad screening process intended to identify publicly traded, U.S.-based companies that are internally managed (externally-managed companies generally have not disclosed comprehensive compensation data and are therefore excluded) |

  30. Compensation Peer Group for 2024

    | Step 2: | Identify REITs and other companies most similar to Redwood (i.e., direct peers), including: | | | | • | Mortgage REITs, which are considered “direct peers” along with real estate development and financial services companies with a focus on mortgage servicing or mortgage-related assets | | | • | Exclude all companies with market capitalization values outside of a 0.25-4.0x range compared to Redwood, subject to reasonable exceptions for key business competitors and based on 12-month average market capitalization |

  31. Compensation Peer Group for 2024

    | Step 3: | Identify other relevant business and labor-market competitors: | | | | • | Financial services companies with both market capitalization value in a 0.5-2.0x range compared to Redwood based on 12-month average market capitalization | | | • | Exclude bank holding companies and companies in the cash advance/pawn broker businesses, due to fundamental differences in the underlying business model |

  32. Compensation Peer Group for 2024

    | Step 4: | Select 15 to 25 companies for inclusion in the compensation peer group: | | | | • | Generally include all companies identified in Step 2 | | | • | Generally include companies identified in Step 3 if they: (1) are included in the prior year’s compensation peer group or (2) have been identified as a peer of Redwood’s most-direct peers (e.g., a peer of another mortgage REIT identified in Step 2) | | | • | Add additional companies identified in Step 3 to: (1) ensure that the sample size is sufficient and (2) position Redwood closer to the median on key size measures, focusing primarily on market capitalization and secondarily on total assets and net income |

  33. Compensation Peer Group for 2024

    The Committee recognizes that the compensation peer group does not include generally higher-paying externally-managed REITs, mortgage-focused divisions of large publicly-traded financial institutions, private equity firms, and hedge funds with which Redwood competes for executive talent. These organizations are not included because they have different business economics and pay models from Redwood, and because comprehensive compensation data for their executives are generally not publicly available. The Committee reviews the compensation peer group and the selection process and criteria on an annual basis to confirm that it continues to reflect relevant business and labor market competitors for whom comprehensive data is available. Accordingly, the companies included as peers may change from year to year as a result of updates to the selection process and criteria and changes in the real estate and capital markets. Following the completion of the Committee’s review process in 2024, there were no changes to the compensation peer group from the 2023 compensation peer group. 2024 Compensation Peer Group. Based on the above-described methodology, the compensation peer group approved by the Committee for use in preparing and reviewing the competitive pay analysis in 2024 consisted of the following 19 companies:

  34. Compensation Peer Group for 2024

    | • | Arbor Realty Trust, Inc. | • | Acadian Asset Management(1) | | • | Chimera Investment Corporation | • | Dynex Capital, Inc. | | • | Essent Group Ltd. | • | Granite Point Mortgage, Inc. | | • | Ladder Capital Corp. | • | MFA Financial, Inc. | | • | Mr. Cooper Group, Inc. | • | New York Mortgage Trust, Inc. | | • | NMI Holdings, Inc. | • | PennyMac Financial Services, Inc. | | • | Radian Group, Inc. | • | Rithm Capital Corp. | | • | Safehold, Inc. | • | Two Harbors Investment Corp. | | • | Victory Capital Holdings, Inc. | • | Virtus Investment Partners, Inc. | | • | Walker & Dunlop. Inc. | | |

  35. Compensation Peer Group for 2024

    ________________ (1) BrightSphere Investments Group, Inc. rebranded as Acadian Asset Management effective January 1, 2025.

  36. 2024 Performance-Based Annual Bonus Compensation

    2024 Performance-Based Annual Bonus Compensation Redwood’s annual bonus program is designed to reward executive officers based on Redwood’s financial performance and each executive officer’s individual performance. In accordance with the Committee’s executive compensation philosophy, and the pay-for-performance structure of Redwood’s executive compensation program, there has been significant variability in the performance-based annual bonuses paid to Redwood’s CEO over the past ten years, reflecting the variations in Redwood’s compensation program and financial performance over the same period. Set forth below is a description of the components of the 2024 performance-based annual bonus compensation for Redwood’s executive officers, including a description of the financial performance metrics and targets used within the bonus program’s structure. Components of 2024 Annual Bonuses. In order to align executives’ interests with the interests of stockholders, in the first quarter of 2024 the Committee determined, after consultation with its independent compensation consultant, that 2024 target annual bonuses for executive officers would continue to be weighted as follows: ◦Company/Financial Performance Component. 75% on the achievement of predetermined target levels of Redwood’s financial performance for 2024; and ◦Individual Performance Component. 25% on individual contributions to the Company’s pre-established annual strategic, business, operational and risk management goals and objectives for 2024. The weightings described above were used so that most of an executive officer’s target annual bonus will depend directly on company financial performance, while also providing incentives for achievement of individual strategic, business, operational and risk management goals that the Committee believes are in the interests of Redwood and its stockholders, but in some cases may be difficult to quantitatively link to annual company financial performance. Financial Performance Metrics for 2024 Annual Bonuses. Also during the first quarter of 2024, after a review of Redwood’s compensation program, and following consultation with its independent compensation consultant, the Committee determined to continue to use two different non-GAAP financial performance metrics in 2024 within the methodology for determining realization of each executive officer’s performance-based annual bonus. In the process of reaching its conclusion to continue using these two financial performance metrics for 2024 – namely, Adjusted ROE and Adjusted EAD ROE1 – each of which is further described below, the Committee considered whether alternative or additional financial performance metrics should be used within the methodology for determining performance-based annual bonuses. Although for 2024, the Committee continued to use the same financial performance metrics that had been used in 2023, it discussed that as the Company’s business model continued to evolve, additional or alternative financial performance metrics could be incorporated into the annual bonus methodology in future years to continue to maintain strong alignment between the bonus program’s incentive structure and the metrics that are strongly correlated with increasing earnings and book value and driving stockholder returns. For 2024, the Committee determined that 50% of the target amount of the financial performance component of annual bonuses would be realized based on 2024 Adjusted ROE and the other 50% of the target amount of the financial performance component of annual bonuses would be realized based on 2024 Adjusted EAD ROE. ◦Adjusted ROE. Adjusted ROE is a non-GAAP financial performance metric, which has historically been very closely correlated to Redwood’s ROE based on GAAP financial results, but differs in certain respects. 1 Note: Adjusted ROE and Adjusted EAD ROE should not be considered as alternatives to GAAP net income, GAAP ROE or other measurements of results of operations computed in accordance with GAAP or for federal income tax purposes. See Annex B to this Proxy Statement for additional discussion, disclosure and details regarding these non-GAAP financial performance metrics. ▪Adjusted ROE generally reflects adjusted earnings on average common equity capital adjusted to exclude certain unrealized mark-to-market gains and losses from equity. Because Adjusted ROE is a ratio of earnings to equity capital, the adjustment to exclude certain unrealized mark-to-market gains and losses from equity is made to enable the calculation of an “apples-to-apples” non-GAAP ratio of earnings to common equity capital for purposes of evaluating financial performance. ▪In addition, through adjustments to earnings, Adjusted ROE, among other things, excludes certain acquisition-related expenses – e.g., excludes amortization expense related to intangible assets acquired in acquisitions and the hypothetical income taxes associated with these adjustments. The Committee believes that Adjusted ROE is an appropriate measure of financial performance to use within its methodology for determining realization of annual bonuses for Redwood’s executive officers because, among other reasons, a key source of earnings at Redwood is income from investments in mortgage loans and other real estate-related assets, as well as from mortgage banking activities and Adjusted ROE assists the Committee in analyzing the Company’s results of operations. It is also a performance metric that the Committee believes, over the long-term, should be correlated with long-term stockholder returns. Additional discussion, disclosure and details relating to Adjusted ROE are set forth within Annex B to this Proxy Statement. ◦Adjusted EAD ROE. Adjusted EAD ROE is a non-GAAP financial performance metric derived from Redwood’s ROE based on GAAP financial results, but which differs in key respects. Adjusted EAD ROE is calculated by first deriving non-GAAP Adjusted Earnings Available for Distribution (“Adjusted EAD”) from earnings and then dividing Adjusted EAD by average common equity capital adjusted to exclude certain unrealized mark-to-market gains and losses from equity. ▪Adjusted EAD is derived from earnings through, among other things, the following adjustments: (i) exclude investment fair value changes, net; (ii) exclude realized gains and losses; (iii) exclude certain acquisition-related expenses – e.g., exclude amortization expense related to intangible assets acquired in acquisitions; and (vi) exclude certain organizational restructuring charges (as applicable). The Committee believes that Adjusted EAD ROE is an appropriate measure of financial performance to use within its methodology for determining realization of annual bonuses for Redwood’s executive officers because, among other reasons, a key source of returns to Redwood’s stockholders is through regular quarterly dividends and Adjusted EAD ROE assists the Committee in analyzing the Company’s results of operations and helps to facilitate the Committee’s comparisons of Redwood’s financial performance to industry peers, including by supplementing the Committee’s analysis of the Company’s ability to pay dividends, and provides for the Committee an indication of the current income generating capacity of the Company's business operations on a quarterly basis. It is also a performance metric that the Committee believes, over the long-term, should be correlated with long-term stockholder returns. Additional discussion, disclosure and details relating to Adjusted EAD and Adjusted EAD ROE are set forth within Annex B to this Proxy Statement.

  37. 2024 Performance-Based Annual Bonus Compensation

    Financial Performance Targets for 2024 Annual Bonuses. As noted above, for 2024, the Committee determined that 50% of the target amount of the financial performance component of annual bonuses would be realized based on 2024 Adjusted ROE and the other 50% of the target amount of the financial performance component of annual bonuses would be realized based on 2024 Adjusted EAD ROE, in each case based on 2024 financial performance relative to a 2024 target level established by the Committee in the first quarter of 2024. The 2024 financial performance targets established by the Committee were as follows: Adjusted ROE of 11.5% and Adjusted EAD ROE of 6.5%. In determining these financial performance targets for 2024, the Committee took into account input from, management, its independent compensation consultant, and the Board of Directors, and followed a process consistent with how it has historically determined targets for the Company performance component of annual bonuses for executive officers. The Committee decided to continue its historical practice of using an Adjusted ROE financial performance target determined at the beginning of each year based on a risk-free interest rate plus an incremental premium determined by the Committee to be appropriate (each of which can vary from year to year). This decision continued to be premised, as it was in 2023, in large part on the nature of Redwood’s business model, which has had a significant focus on investing in residential mortgage loans and other real-estate related loans and debt instruments. Returns that Redwood can earn on investments in residential mortgage loans and other real-estate related loans and debt investments are, to a certain extent, correlated with the market-driven interest rates for these and other types of loans and debt instruments (which rates depend on the perceived risk of these investments). These market-driven interest rates are typically analyzed as the risk-free interest rate for investment in U.S. Treasury obligations (or other debt backed by the full faith and credit of the U.S.) with a comparable duration plus an incremental risk premium above the risk-free rate. The decision to use an Adjusted ROE target based on a risk-free interest rate plus an incremental premium was also premised on the fact that management believes that investors focused on investing in companies like Redwood, including companies that operate mortgage banking platforms, also compare return on equity to risk-free rates of return in evaluating Redwood’s financial performance and that the Adjusted ROE financial performance target should take into account stockholders’ return and dividend yield expectations. As a result, the Committee also reviewed recent and historical dividend yields on Redwood’s common stock and determined a range of incremental premiums above the risk-free rate that would be supportive of those yields. In addition to its review of market returns Redwood could earn on investments generated from mortgage banking operations, and the level of Adjusted ROE financial performance necessary to meet stockholders’ return and dividend yield expectations, the Committee reviewed the level of Adjusted ROE performance necessary to support the payment of regular quarterly dividends declared by the Board of Directors. The Committee believes that setting an Adjusted ROE performance target at an appropriate level above the risk-free interest rate (by adding the incremental premium to the risk-free interest rate) establishes an incentive for executives to achieve attractive financial performance for Redwood (and aligns the interests of executives and stockholders in seeking this level of financial performance), without exposing Redwood to inappropriate risk. Overall, the Committee believes that the use of a performance target that can vary from year to year provides the ability to adjust compensation incentives in a manner consistent with Redwood’s business model and the market environment in which Redwood operates. For example, leading into 2024, when the 2024 target for Adjusted ROE was established, the market environment that Redwood would operate within during 2024 was generally contemplated to be one characterized by, among other things, declining benchmark interest rates, which would, all other factors being equal, support or increase the market value of certain portfolio assets and contribute to near-term mark-to-market gains that would be reflected in 2024 Adjusted ROE. This was one of various factors taken into account by the Committee in maintaining the Adjusted ROE target for 2024 at the 11.5% level that had been in place in 2023. Had the outlook for benchmark interest rates leading into 2024 been for a “higher-for-longer” benchmark interest rate environment, or for increasing benchmark interest rates, this would have been expected, all other factors being equal, to decrease the near-term market value of certain portfolio assets and contribute to mark-to-market losses, which could have contributed to a determination to lower the Adjusted ROE target to reflect these more challenging market conditions. Similarly, the outlook for credit spreads – which measure the yield on an investment demanded by the market based on that investment’s credit profile relative to benchmark interest rates – is an aspect of the market environment that Redwood operates in that is one of the factors the Committee considers when setting financial performance targets. In setting an Adjusted EAD ROE financial performance target for 2024, the Committee took into account the factors described above with respect to its process for setting an Adjusted ROE target and also considered factors relating to the adjustments made to calculate Adjusted EAD ROE and how those adjustments assist management and investors in analyzing Redwood’s financial performance and help facilitate comparisons to industry peers and how those adjustments can also supplement analysis of the Redwood’s ability to pay a sustainable and growing level of dividends. After consideration of the foregoing, as well as the alternative line-of-sight that this financial performance metric provides into fundamental Company performance and key metrics that drive stockholder value creation, the Committee believes it set the Adjusted EAD ROE target at an appropriate level for the market environment the Company expected to operate in during 2024 and thereby established an important incentive for executives to achieve attractive Adjusted EAD ROE financial performance for Redwood, without exposing Redwood to inappropriate risk.

  38. 2024 Performance-Based Annual Bonus Compensation

    Other Aspects of 2024 Annual Bonus Methodology. Following this process for determining the financial performance targets to be used in the methodology for determining Company performance bonuses, the Committee also established how above- and below-target bonus amounts would be formulaically determined based on these financial performance targets, as follows: (i) with respect to the portion of the financial performance component of annual bonus determined based on Adjusted ROE, no bonus amounts would be earned if Adjusted ROE was 2.875% or less; bonus amounts below or at the target bonus amounts would be earned if Adjusted ROE was between 2.875% and 11.5%; and bonus amounts in excess of the target bonus amounts would not be earned unless Adjusted ROE was more than 11.5%; and (ii) with respect to the portion of the financial performance component of annual bonus determined based on Adjusted EAD ROE, no bonus amounts would be earned if Adjusted EAD ROE was 1.625% or less; bonus amounts below or at the target bonus amounts would be earned if Adjusted EAD ROE was between 1.625% and 6.5%; and bonus amounts in excess of the target bonus amounts would not be earned unless Adjusted EAD ROE was more than 6.5%. Additional detail regarding the formulaic determination of above- and below-target bonus amounts based on these financial performance targets – i.e., the formulaic “leverage” of this annual bonus methodology – is set forth within Annex B to this Proxy Statement. The use of an initial performance threshold of greater than 2.875% Adjusted ROE and greater than 1.625% Adjusted EAD ROE for the payment of any of portion of target Company performance bonuses based on these metrics, respectively, represents a determination by the Committee that financial performance below that threshold is not significant enough margin to merit payment of any portion of this component of annual bonuses. The payment of target Company performance bonuses or a portion of target Company performance bonuses for Adjusted ROE in the range between 2.875% and 11.5% and Adjusted EAD in the range between 1.625% and 6.5%, respectively, reflects the determination by the Committee that financial performance within this range merits payment of below-target or target Company performance bonuses as financial performance improves above the initial performance threshold. The Committee also determined that for Adjusted ROE in excess of 11.5% and for Adjusted EAD ROE in excess of 6.5%, respectively, subject to the maximum total bonus opportunity for each executive officer noted below and assuming the individual performance bonuses are earned at target level, the Company performance bonus would be increased by a pro-rated amount for the portion based on such metric above the target amount (based on a straight-line, mathematical interpolation) as described in Annex B to this Proxy Statement, but subject to each executive officer’s maximum annual bonus opportunity (annual bonus cap). Additionally, the Committee determined at the outset of 2024 that individual performance in 2024 for each executive officer would be reviewed in the context of, among other things, the specific pre-determined goals and factors discussed below under “Performance-Based Annual Bonuses Earned for 2024 — Individual Performance Component of 2024 Annual Bonuses.” As in past years, during 2024 these individual factors and goals were subject to adjustment when circumstances warranted, at the discretion of the Committee. For 2024, the individual performance component of annual bonuses could be earned up to 200% of the target amount depending on the Committee’s assessment of individual performance. With respect to the maximum annual bonus opportunity (i.e., the maximum sum of the two components of the annual bonus) that each executive officer could earn for 2024, as disclosed in last year’s annual proxy statement, these annual bonus caps were reduced from the levels that applied in 2023 (3.5x of total target annual bonus for each executive officer) to 3.0x of total target annual bonus for each executive officer in 2024 and going forward. Executive Officers’ 2024 Target Annual Bonus Amounts. At the end of 2023, the Committee made determinations with respect to each NEO’s target 2024 annual bonus after consultation with its independent compensation consultant and consideration of compensation peer group comparisons for the position, competitive factors and the executive officer’s role, experience, and performance at Redwood. ◦Mr. Abate. The Committee determined that the 2024 target bonus percentage for Mr. Abate would remain unchanged at 200% of base salary. ◦Mr. Robinson. The Committee determined that the 2024 target bonus percentage for Mr. Robinson would be increased from 190% to 195% of base salary. ◦Ms. Carillo. The Committee determined that the 2024 target bonus percentage for Ms. Carillo would be increased from 185% to 190% of base salary. ◦Ms. Macomber. The Committee determined that the 2024 target bonus percentage for Ms. Macomber would be increased from 150% to 175% of base salary. ◦Mr. Stone. The Committee determined that the 2024 target bonus percentage for Mr. Stone would be increased from 150% to 175% of base salary.

  39. 2024 Performance-Based Annual Bonus Compensation

    | | 2024 | | 2024 | 2024 | | | | Base Salary | | Target Annual Bonus | Target Annual Bonus | | | NEO | ($ per annum) | | (as % of Base Salary) | | ($) | | Mr. Abate, Chief Executive Officer | $ | 950,000 | 200% | $ | 1,900,000 | | Mr. Robinson, President | $ | 875,000 | 195% | $ | 1,706,250 | | Ms. Carillo, Chief Financial Officer | $ | 825,000 | 190% | $ | 1,567,500 | | Ms. Macomber, Chief Human Resource Officer | $ | 500,000 | 175% | $ | 875,000 | | Mr. Stone, Executive Vice President and Chief Legal Officer | $ | 500,000 | 175% | $ | 875,000 |

  40. Performance-Based Annual Bonuses Earned for 2024

    Performance-Based Annual Bonuses Earned for 2024 Annual performance-based bonuses earned by executive officers for 2024 consisted of both a Company performance component and an individual performance component. A further discussion of each of these components is set forth below. Company Performance Component of 2024 Annual Bonuses. As described above, for 2024, the Committee determined that 50% of the target amount of the Company performance component of annual bonuses would be realized based on 2024 Adjusted ROE and the other 50% of the target amount of the Company performance component of annual bonuses would be realized based on 2024 Adjusted EAD ROE. ◦Redwood’s Adjusted ROE for 2024 was above the initial performance threshold of 2.875% Adjusted ROE, but below the financial performance target of 11.5% Adjusted ROE. Accordingly, the portion of the Company performance component of 2024 annual bonuses determined based on Adjusted ROE was realized at 39% of the target amount for that component. ◦Redwood’s Adjusted EAD ROE for 2024 was above the initial performance threshold of 1.625%, but below the financial performance target of 6.5% for Adjusted EAD ROE. Accordingly, the portion of the Company performance component of 2024 annual bonuses determined based on Adjusted EAD ROE was realized at 95% of the target amount for that component. The table below sets forth the target bonus amount for each NEO for the Company performance component of annual bonus, together with the amount of this component each executive officer realized/earned based on the Company’s financial performance in 2024.

  41. Performance-Based Annual Bonuses Earned for 2024

    | | Company Performance Component of 2024 Target Annual Bonus | | 2024 Company Performance Component of Annual Bonus Earned | | % of Company Performance Component Earned | | NEO | ($) | | ($) | | (%) | | Mr. Abate, Chief Executive Officer | $ | 1,425,000 | $ | 956,196 | 67.1% | | Mr. Robinson, President | $ | 1,279,687 | $ | 858,690 | 67.1% | | Ms. Carillo, Chief Financial Officer | $ | 1,175,625 | $ | 788,862 | 67.1% | | Ms. Macomber, Chief Human Resource Officer | $ | 656,250 | $ | 440,353 | 67.1% | | Mr. Stone, Executive Vice President and Chief Legal Officer | $ | 656,250 | $ | 440,353 | 67.1% |

  42. Performance-Based Annual Bonuses Earned for 2024

    Individual Performance Component of 2024 Annual Bonuses. For 2024, the individual performance components of annual bonuses were determined after a review of each NEO’s individual achievements and contributions to the collective achievements of the senior management team. The Committee reviewed the performance of the NEOs as a team, which included a review of the NEOs’ self-assessment and the assessment by Mr. Abate of the other NEOs. Among other factors, the Committee considered contributions to the achievement of the company-wide goals noted below in assessing individual performance for 2024. With respect to each of these goals, the Committee took into account various factors (other than the Company’s financial performance) in evaluating the level of attainment of the goal and contributions to achieving the goal, including the principal factors described below and the related level of attainment (presented in italics after each listed goal). In considering these goals and factors, the Committee did not assign specific weightings to each factor and goal, but instead considered them together as part of a comprehensive qualitative review. Goal – Capital, Financing and Liquidity: Diversify and manage overall sources and structures of capital and financing to mitigate risk, advance long-term asset management objectives through additional dedicated capital and financing relationships, and unlock and access additional capital for redeployment into our mortgage banking businesses and portfolio investments. The Committee evaluated achievement of this goal in the context of various factors, including that during 2024 management’s initiatives relating to capital, financing, liquidity and financial risk management resulted in: successful completion of a senior notes offering in early 2024, followed by a second senior notes offering in June 2024; issuance of additional convertible debt through the reopening of Redwood’s outstanding series of convertible senior notes due in 2027; a significant reduction in the outstanding balance of debt maturing through year-end 2026; establishment of strategic capital relationship with the Canada Pension Plan (“CPP”), which included a secured corporate financing facility with a total capacity of up to $250 million and a $500 million asset joint venture to invest across the broad suite of CoreVest originated bridge and term loans; establishment and renewal of various secured financing lines, including to increase the investment capacity of the CPP joint venture to $1.5 billion; completing an inaugural securitization of CPP joint venture assets; and unlocking significant capital for reinvestment through securitization of portfolio assets. Goal – CoreVest Mortgage Banking: Execute on strategic initiatives related to growth and increasing the profitability of Redwood’s CoreVest Mortgage Banking business – including initiatives related to product focus, origination volumes, distribution strategy, expense structure, and resolution of special assets – while maintaining risk and operational discipline and seeking synergies with other business units within Redwood. The Committee evaluated achievement of this goal in the context of various factors, including that during 2024 management’s initiatives relating to the CoreVest Mortgage Banking business resulted in: an overall increase in loan fundings of 9% compared to 2023; establishment of relationships with insurance company capital and sale of more than $300 million of CoreVest originated loans to insurance company portfolios; the sale of more than $800 million of CoreVest originated loans to joint ventures; establishment of additional relationships with whole-loan buyers of CoreVest-originated loans, further diversifying loan distribution channels alongside continued distribution through securitization transactions; successful focus on origination and distribution of single-asset bridge loans, with record quarterly funding levels for this product across 2024; a meaningful increase in origination of debt-service coverage (“DSCR”) loans; enhanced non-performing loan asset management staffing and increased resolutions and line-of-sight to resolutions of special assets; and rationalization of workforce and expense structure, including increased cross-training across product line, resulting in a return to profitability for this business segment. Goal – Sequoia Mortgage Banking: Execute on strategic initiatives responsive to evolving consumer residential mortgage market – including initiatives related to deepening relationships with banks, growing business activity under our Aspire initiative related to expanded prime mortgage loans and home equity investments (“HEI”) – while maintaining risk and operational discipline and seeking synergies with other business units within Redwood. The Committee evaluated achievement of this goal in the context of various factors, including that during 2024 management’s initiatives relating to the Sequoia Mortgage Banking business resulted in: a greater than 150% increase in loan volume compared to 2023, significantly increasing overall market share; continued focus on relationships with banks, resulting in both enhanced acquisition and disposition channels for residential consumer mortgage loans; issuance of the highest number of residential consumer mortgage loan securitization transactions under the SEMT® brand since 2013 and 2018; a four-fold increase in whole-loan sales, an important distribution channel that balances reliance on the securitization market; the launch of our closed-end second mortgage loan acquisition initiative; responding to the evolving needs of the housing market through expansion of our Aspire initiative, which included establishing a footprint to directly originate HEI in more than ten states, and creating the infrastructure for new expanded prime product launches to commence in early 2025; and the successful leveraging of existing Sequoia operational staff to support Aspire initiatives, enhance efficiency, reduce cost-per-loan and increase profitability of this nosiness segment. Goal – Investment Portfolio: Within Redwood’s Investment Portfolio pursue investing strategies complementary to Redwood’s mortgage banking businesses and generate net interest income to support regular quarterly dividends, proactively monitor markets for relative value opportunities in non-Agency mortgage credit, including interest-only securities and third-party issued residential consumer mortgage credit investments, and deploy capital within established guidelines, including relating to duration and use of leverage. The Committee evaluated achievement of this goal in the context of various factors, including that during 2024 management’s actions related to portfolio investments resulted in: deployment of more than $500 million of capital into high-conviction strategies with attractive target yields, with an appropriate mix of third-party sourced investments and assets created from Redwood’s mortgage banking businesses; continuing generation of meaningful levels of net interest income supportive of quarterly dividends; and maintenance of discipline around the duration, liquidity and leverage profile targeted for deployment during 2024. Goal – Human Capital: Support near- and long-term business and strategic goals and initiatives through strong human capital management and engagement initiatives; and continue to invest in training, programs, and mentorship efforts that contribute to leadership and talent development.

  43. Performance-Based Annual Bonuses Earned for 2024

    The Committee evaluated achievement of this goal in the context of various factors, including that during 2024 management’s initiatives relating to human capital resulted in: maintaining a strong workforce culture with a consistent cadence of employee programming, training, and events that were the foundation for maintaining a below-industry level of voluntary turnover and furthering workforce engagement, despite a rationalization of the workforce in the first quarter of 2024; consistent and constructive interaction among employees at all levels of the organization, including through regular company-wide and business unit-specific “town hall” meetings, community and volunteer events, and recognition and celebration of employee achievements; and implementation of an updated talent review and promotion framework that further clarified criteria for advancement, streamlined our promotion process, and provided management with further visibility into our succession pipeline. Based on the review described above, the individual performance components of annual bonuses for each NEO for 2024 were determined, as set forth in the table below.

  44. Performance-Based Annual Bonuses Earned for 2024

    | | Individual Performance Component of 2024 Target Annual Bonus | | % of Individual Performance Component Earned | 2024 Individual Performance Component of Annual Bonus Realized/Earned | | | NEO | ($) | | (%) | | ($) | | Mr. Abate, Chief Executive Officer | $ | $475,000 | 130% | $ | $617,500 | | Mr. Robinson, President | $ | $426,563 | 130% | $ | $554,531 | | Ms. Carillo, Chief Financial Officer | $ | $391,875 | 140% | $ | $548,625 | | Ms. Macomber, Chief Human Resource Officer | $ | $218,750 | 120% | | $262,500 | | Mr. Stone, Executive Vice President and Chief Legal Officer | $ | $218,750 | 120% | $ | $262,500 |

  45. Performance-Based Annual Bonuses Earned for 2024

    Total Performance-Based Annual Bonus Earned for 2024. Based on the realization of the Company performance and individual performance components of annual bonuses described above, the table below sets forth the total performance-based annual bonus realized by each NEO for 2024.

  46. Performance-Based Annual Bonuses Earned for 2024

    | | 2024 Target Annual Bonus | | 2024 Annual Bonus Realized | 2024 Annual Bonus Realized | | | NEO | ($) | | ($) | | (% of Target) | | Mr. Abate, Chief Executive Officer | $ | $1,900,000 | $1,573,696 | $ | 82.8% | | Mr. Robinson, President | $ | $1,706,250 | $1,413,221 | $ | 82.8% | | Ms. Carillo, Chief Financial Officer | $ | $1,567,500 | $1,337,487 | $ | 85.3% | | Ms. Macomber, Chief Human Resource Officer | $ | $875,000 | $702,853 | | 80.3% | | Mr. Stone, Executive Vice President and Chief Legal Officer | $ | $875,000 | $702,853 | $ | 80.3% |

  47. 2024 Long-Term Equity-Based Incentive Awards

    2024 Long-Term Equity-Based Incentive Awards Equity ownership in Redwood provides an important link between the interests of stockholders and executives by rewarding long-term stockholder value creation. To meet this objective, officers, directors, key employees, and other persons expected to contribute to Redwood’s management, growth, and profitability are eligible to receive long-term equity-based awards. The Committee oversees the issuance of these awards to NEOs. The Committee, in consultation with its independent compensation consultant, determines the types and sizes of awards granted based upon a number of factors, including the executive officer’s position, responsibilities, total compensation level, individual and company financial performance, competitive factors, and compensation peer group comparisons. The Committee’s annual practice is generally to determine the size of long-term equity-based awards to NEOs at the regularly scheduled (pre-established) fourth quarter meeting of the Committee (which for 2024 occurred on in December 2024), with the grant date for such awards in 2024 being December 19, 2024. The long-term equity-based awards the Committee granted to NEOs in 2024 were in three forms: Deferred Stock Units (“DSUs”), cash-settled RSUs (“csRSUs”), and Performance Stock Units (“PSUs”), the key terms of which are summarized below.

  48. 2024 Long-Term Equity-Based Incentive Awards

    | • | The DSUs granted to NEOs on December 19, 2024 will vest over four years, with 25% vesting on January 31, 2026, and an additional 6.25% vesting on the last day of each subsequent quarter (beginning with the quarter ending March 31, 2026), with full vesting occurring on December 18, 2028. Shares of Redwood common stock underlying these DSUs will be distributed to the recipients not earlier than December 18, 2028 and not later than December 31, 2028, unless electively deferred under the terms of Redwood’s Executive Deferred Compensation Plan. |

  49. 2024 Long-Term Equity-Based Incentive Awards

    | • | The csRSUs granted to NEOs on December 19, 2024 will vest over four years, with 25% vesting on December 18, 2025, and an additional 25% vesting on December 18th of each of 2026, 2027 and 2028. The terms of the csRSUs granted on December 19, 2024 are otherwise generally consistent with the terms of the DSUs noted above, except that at each csRSU vesting date, the value of the common stock referenced by the csRSUs vesting on such date will be settled with a cash payment, rather than through the delivery of shares of common stock, based on the closing price of Redwood’s common stock on such vesting date. |

  50. 2024 Long-Term Equity-Based Incentive Awards

    | • | The PSUs granted to NEOs on December 19, 2024 are performance-based equity awards which provide for vesting to generally range from 0% to 250% of the target number of PSUs granted, with the target number of PSUs adjusted to reflect the value of any dividends declared on Redwood common stock during the vesting period (as further described below). Vesting of these PSUs will generally occur based on the performance metrics described below during a three-year measurement period and continued employment through January 1, 2028. Further detail on performance-based vesting of the PSUs granted in December 2024 is set forth below. |

  51. 2024 Long-Term Equity-Based Incentive Awards

    Performance-Based Vesting – PSUs Granted in December 2024. Performance-based vesting of the PSUs granted to NEOs in December 2024 will generally occur as of January 1, 2028, after a three-year performance measurement period encompassing January 1, 2025 to December 31, 2027, based on a three-step process as described below.

  52. 2024 Long-Term Equity-Based Incentive Awards

    | First, the target number of PSUs granted (“Target PSUs”) is divided into two tranches of Target PSUs, as follows: | | | (1) | one tranche (the “bvTSR Tranche”) represents 66.7% of the Target PSUs, with vesting for this portion of the Target PSUs to range from 0% to 250% of this portion of the Target PSUs based on the level of Redwood’s book value TSR (or “bvTSR”) over the three-year performance measurement period, with 100% of this portion of the Target PSUs vesting if cumulative bvTSR for the three-year performance period is 25%; and | | (2) | a second tranche (the “rTSR Tranche”) represents 33.3% of the Target PSUs, with vesting for this portion of the Target PSUs to range from 0% to 250% of this portion of the Target PSUs based on the level of Redwood’s relative TSR (or “rTSR”) over the three-year performance measurement period, with 100% of this portion of the Target PSUs vesting if rTSR for the three-year performance period is at the 55th percentile relative to the comparator group of companies described below. |

  53. 2024 Long-Term Equity-Based Incentive Awards

    ◦Vesting for the bvTSR tranche of these PSUs will be in accordance with the following table:

  54. 2024 Long-Term Equity-Based Incentive Awards

    | Cumulative bvTSR Over Three-Year Period: | % of Performance-Based Vesting:* | | Less than 12.5% bvTSR | 0% | | 12.5% bvTSR | 50% | | 25% bvTSR | 100% | | 37.5% or greater bvTSR | 250% | | * If actual bvTSR is between two of the performance thresholds set forth in this table, the percentage of performance-based vesting is determined based on a straight-line, mathematical interpolation between the applicable performance-based vesting percentages. | |

  55. 2024 Long-Term Equity-Based Incentive Awards

    ◦Vesting for the rTSR tranche of these PSUs will be in accordance with the following table:

  56. 2024 Long-Term Equity-Based Incentive Awards

    | | Three-Year Relative TSR (“rTSR”): | % of Performance-Based Vesting:* | | | Less than 27.5th percentile | 0% | | | 27.5th percentile | 50% | | | 55th percentile | 100% | | | 82.5th percentile or greater | 250% | | * If actual relative TSR is between two of the performance thresholds set forth in this table, the adjustment to baseline vesting is determined based on a straight-line, mathematical interpolation between the applicable percentage point adjustments. | | |

  57. 2024 Long-Term Equity-Based Incentive Awards

    ◦bvTSR for the PSUs granted in December 2024 is generally defined as the percentage by which Redwood’s GAAP book value per share (after reversing the net impact of specified acquisition-related accounting items) has increased or decreased as of the last day of the three-year performance measurement period relative to the first day of such period, plus the value of cash dividends declared and/or paid during such period on Redwood common stock. ◦rTSR for the PSUs granted in December 2024 is generally defined as Redwood’s three-year rTSR compared to a subset of the component companies of the FTSE NAREIT Mortgage REITs Index, as constituted on December 31, 2024, categorized within that index as “Property Sector: Mortgage-Home Financing” (other than Redwood), expressed as a percentile of relative performance. Second, at the end of the three-year vesting period, the aggregate vesting level of the two tranches would be determined as the sum of (i) the bvTSR-based vesting of the bvTSR Tranche and (ii) rTSR-based vesting of the rTSR Tranche. Third, if the aggregate vesting level after steps one and two is greater than 100% of the Target PSUs, but Redwood’s absolute total shareholder return (“TSR”) is negative over the three-year performance period, performance-based vesting will be capped at 100% of Target PSUs. ◦Absolute TSR is generally defined as the percentage by which the per share price of Redwood’s common stock has increased or decreased as of the last day of the three-year performance measurement period relative to the first day of such period, adjusted to reflect the reinvestment of all dividends declared and/or paid during such period on Redwood common stock. Vested shares of Redwood common stock underlying these PSUs, if any, will be distributed to the recipients not later than 45 days following April 1, 2028, unless electively deferred under the terms of Redwood’s Executive Deferred Compensation Plan. Prior to vesting, no dividend equivalent rights are paid in respect of PSUs. At the time of vesting, the value of any dividends paid during the vesting period will be reflected in the PSUs by increasing the target number of PSUs granted by an amount corresponding to the incremental number of shares of Redwood common stock that a stockholder would have acquired between the grant date and the end of the three-year performance measurement period, had all dividends during that period been reinvested in Redwood common stock on the applicable dividend payment dates. After the vesting of any of these PSUs on January 1, 2028, and until the delivery of the underlying shares of Redwood common stock, the underlying vested award shares will have attached dividend equivalent rights, resulting in the payment of dividend equivalents each time Redwood pays a common stock dividend. Equity-Based Award Agreements. The terms of the DSUs, csRSUs, and PSUs granted in 2024 are established under applicable equity-based award agreements and Redwood’s 2014 Incentive Plan. These terms include provisions relating to dividend equivalent rights, forfeiture, retirement, mandatory net settlement for income tax withholding purposes, and change-in-control. NEOs’ 2024 Year-End Long-Term Equity-Based Incentive Award Values. The Committee made the following determinations with respect to the value of 2024 year-end long-term equity-based incentive awards granted to NEOs in December 2024 after consultation with its independent compensation consultant, a review of compensation peer group comparisons for the position and consideration of competitive factors, and the executive officer’s role, experience, and performance at Redwood. ◦Mr. Abate. In December 2024, the Committee determined that the aggregate grant date fair value of year-end, long-term equity-based incentive awards granted to Mr. Abate would total $4.35 million, with this award value granted as: $2.3925 million in PSUs (55% of total value), $652,500 in DSUs (15% of total value), and $1.305 million in csRSUs (30% of total value). ◦Mr. Robinson. In December 2024, the Committee determined that the aggregate grant date fair value of year-end, long-term equity-based incentive awards granted to Mr. Robinson would total $3.6 million, with this award value granted as: $1.8 million in PSUs (50% of total value), $612,000 in DSUs (17% of total value), and $1.188 million in csRSUs (33% of total value). ◦Ms. Carillo. In December 2024, the Committee determined that the aggregate grant date fair value of year-end, long-term equity-based incentive awards granted to Ms. Carillo would total $3.5 million, with this award value granted as: $1.75 million in PSUs (50% of total value), $595,000 in DSUs (17% of total value), and $1.155 million in csRSUs (25% of total value). ◦Ms. Macomber. In December 2024, the Committee determined that the aggregate grant date fair value of year-end, long-term equity-based incentive awards granted to Ms. Macomber would total $1.5 million, with this award value granted as: $750,000 in PSUs (50% of total value), $255,000 in DSUs (17% of total value), and $495,000 in csRSUs (33% of total value). ◦Mr. Stone. In December 2024, the Committee determined that the aggregate grant date fair value of year-end, long-term equity-based incentive awards granted to Mr. Stone would total $1.5 million, with this award value granted as: $750,000 in PSUs (50% of total value), $255,000 in DSUs (17% of total value), and $495,000 in csRSUs (33% of total value). The number and grant date fair value of DSUs, csRSUs and PSUs comprising the 2024 year-end long-term equity-based awards granted to each NEO in December 2024 are set forth in the table below.

  58. 2024 Long-Term Equity-Based Incentive Awards

    | | Deferred Stock Units (“DSUs”)(1) | | Cash Settled Restricted Stock Units (“csRSUs”)(1) | | Performance Stock Units (“PSUs”)(1) | | | NEO | # | Aggregate Grant Date Fair Value | # | Aggregate Grant Date Fair Value | # | Aggregate Grant Date Fair Value | | Mr. Abate, Chief Executive Officer | 98,268 | $652,500 | 196,536 | $1,304,999 | 318,893 | $2,392,495 | | Mr. Robinson, President | 92,168 | $611,996 | 178,915 | $1,187,996 | 239,920 | $1,800,000 | | Ms. Carillo, Chief Financial Officer | 89,608 | $594,997 | 173,945 | $1,154,995 | 233,255 | $1,749,996 | | Ms. Macomber, Chief Human Resource Officer | 38,403 | $254,996 | 74,548 | $494,999 | 99,966 | $749,995 | | Mr. Stone, Executive Vice President and Chief Legal Officer | 38,403 | $254,996 | 74,548 | $494,999 | 99,966 | $749,995 |

  59. 2024 Long-Term Equity-Based Incentive Awards

    (1) Grant date fair value determined at the time the grant was made in accordance with FASB Accounting Standards Codification Topic 718. The value of dividend equivalent rights associated with DSUs and csRSUs and the value of any increase in the target number of PSUs to reflect dividends paid during the performance period were taken into account in establishing the grant date fair value of these DSUs, csRSUs and PSUs under FASB Accounting Standards Codification Topic 718 at the time the awards were granted. Therefore, dividend equivalent right payments and any increase in the target number of PSUs to reflect dividends paid during the performance period are not considered part of the compensation or other amounts reported in the summary table of executive compensation under “Executive Compensation Tables — Summary Compensation,” or reported below under “Executive Compensation Tables — Grants of Plan-Based Awards.”

  60. Vesting and Mandatory Holding Periods for 2024 Long-Term Equity-Based Incentive Awards

    Vesting and Mandatory Holding Periods for 2024 Long-Term Equity-Based Incentive Awards DSUs Granted in December 2024. The DSUs granted to executive officers in December 2024 have the four-year vesting schedule described above on pages 66-69 within this CD&A under the heading “2024 Long-Term Equity-Based Incentive Awards.” Notwithstanding this vesting schedule, while continuously employed, the executive officers are subject to a mandatory four-year holding period with respect to these DSU awards, with the result that these DSU awards are not scheduled to be distributed to recipients in shares of Redwood common stock until four years following the grant date (i.e., in December 2028). csRSUs Granted in December 2024. The cash-settled RSUs (“csRSUs”) granted to executive officers in December 2024 have the four-year vesting schedule described above on pages 66-69 within this CD&A under the heading “2024 Long-Term Equity-Based Incentive Awards.” PSUs Granted in December 2024. The PSUs granted to executive officers in December 2024 have the three-year vesting/performance measurement period described above on pages 66-69 within this CD&A under the heading “2024 Long-Term Equity-Based Incentive Awards.” For any of these PSUs that vest, they will be distributed to recipients in shares of Redwood common stock not later than 45 days following April 1, 2028.

  61. Pay-for-Performance Outcomes from Long-Term Equity-Based Incentive Awards

    Pay-for-Performance Outcomes from Long-Term Equity-Based Incentive Awards As described above, long-term incentive awards (collectively, “LTI Awards”), including awards in the form of DSUs and PSUs, are a significant component of Redwood’s performance-based compensation program, and generally account for a majority of each NEO’s annual target compensation. These LTI Awards are a key component of the overall executive compensation program, as actual value delivery/realization from these LTI Awards aligns executive compensation with long-term stockholder return experiences, with a key focus on three-year performance measurement periods. As detailed below, in 2024 Redwood’s NEOs vested into realized and delivered compensation from LTI Awards awarded in prior years as follows: Mr. Abate: (i) vesting and delivery of 106,898 DSUs granted in December 2020; (ii) vesting and settlement of 106,898 csDSUs granted in December 2020; (iii) vesting and settlement of 29,605 csRSUs (which was a tranche consisting of 25% of the csRSUs granted in December 2023); and (iv) performance-based vesting of 67,591 PSUs granted in December 2021, which represented 35% of the target number of PSUs granted in December 2021 (based on level of overall attainment of performance-based vesting criteria). ◦As described and illustrated above in the Executive Summary of CD&A on page 42 of this Proxy Statement with respect to Mr. Abate, performance-based vesting of the PSUs granted in December 2021 was driven by both (a) Redwood’s three-year TSR over the January 1, 2022 to December 31, 2024 period, which was significantly below target, and (b) Redwood’s bvTSR over this same period, which, as measured in accordance with the terms of these PSUs, was 27.5% of target level. Mr. Robinson: (i) vesting and delivery of 71,265 DSUs granted in December 2020; (ii) vesting and settlement of 71,265 csDSUs granted in December 2020; (iii) vesting and settlement of 28,081 csRSUs (which was a tranche consisting of 25% of the csRSUs granted in December 2023); and (iv) performance-based vesting of 50,693 PSUs granted in December 2021, which represented 35% of the target number of PSUs granted in December 2021 (based on level of overall attainment of performance-based vesting criteria). ◦As described and illustrated above in the Executive Summary of CD&A on page 42 of this Proxy Statement with respect to Redwood’s CEO, performance-based vesting of the PSUs granted in December 2021 was driven by both (a) Redwood’s three-year TSR over the January 1, 2022 to December 31, 2024 period, which was significantly below target, and (b) Redwood’s bvTSR over this same period, which, as measured in accordance with the terms of these PSUs, was 27.5% of target level. Ms. Carillo: (i) vesting and settlement of 26,075 csRSUs (which was a tranche consisting of 25% of the csRSUs granted in December 2023); and (ii) performance-based vesting of 30,979 PSUs granted in December 2021, which represented 35% of the target number of PSUs granted in December 2021 (based on level of overall attainment of performance-based vesting criteria). ◦As described and illustrated above in the Executive Summary of CD&A on page 42 of this Proxy Statement with respect to Redwood’s CEO, performance-based vesting of the PSUs granted in December 2021 was driven by both (a) Redwood’s three-year TSR over the January 1, 2022 to December 31, 2024 period, which was significantly below target, and (b) Redwood’s bvTSR over this same period, which, as measured in accordance with the terms of these PSUs, was 27.5% of target level. Ms. Macomber: (i) vesting and delivery of 22,805 DSUs granted in December 2020; (ii) vesting and settlement of 22,805 csDSUs granted in December 2020; (iii) vesting and settlement of 12,035 csRSUs (which was a tranche consisting of 25% of the csRSUs granted in December 2023); and (iv) performance-based vesting of 16,897 PSUs granted in December 2021, which represented 35% of the target number of PSUs granted in December 2021 (based on level of overall attainment of performance-based vesting criteria). ◦As described and illustrated above in the Executive Summary of CD&A on page 42 of this Proxy Statement with respect to Redwood’s CEO, performance-based vesting of the PSUs granted in December 2021 was driven by both (a) Redwood’s three-year TSR over the January 1, 2022 to December 31, 2024 period, which was significantly below target, and (b) Redwood’s bvTSR over this same period, which, as measured in accordance with the terms of these PSUs, was 27.5% of target level. Mr. Stone: (i) vesting and delivery of 29,931 DSUs granted in December 2020; (ii) vesting and settlement of 29,931 csDSUs granted in December 2020; (iii) vesting and settlement of 12,035 csRSUs (which was a tranche consisting of 25% of the csRSUs granted in December 2023); and (iv) performance-based vesting of 16,897 PSUs granted in December 2021, which represented 35% of the target number of PSUs granted in December 2021 (based on level of overall attainment of performance-based vesting criteria). ◦As described and illustrated above in the Executive Summary of CD&A on page 42 of this Proxy Statement with respect to Redwood’s CEO, performance-based vesting of the PSUs granted in December 2021 was driven by both (a) Redwood’s three-year TSR over the January 1, 2022 to December 31, 2024 period, which was significantly below target, and (b) Redwood’s bvTSR over this same period, which, as measured in accordance with the terms of these PSUs, was 27.5% of target level.

  62. Pay-for-Performance Outcomes from Long-Term Equity-Based Incentive Awards

    | Section III - Other Compensation, Plans and Benefits | | | | | ➢ | Deferred Compensation | | | ➢ | Employee Stock Purchase Plan | | | ➢ | 401(k) Plan and Other Matching Contributions | | | ➢ | Other Compensation and Benefits | | | ➢ | Severance and Change of Control Arrangements |

  63. Severance and Change of Control Arrangements

    Severance and Change of Control Arrangements For NEOs and other Redwood employees, the terms of outstanding long-term incentive award agreements include “change of control” double-trigger protection that provide for the acceleration of outstanding awards in the event of a termination without “cause” or a termination of employment with “good reason,” following a “change of control.” Within these award agreements, Redwood’s entry into an agreement with a third-party management company to externally manage all or substantially all of Redwood’s assets and/or operations is referred to as an “externalization of management” and is generally treated analogously to a “change of control”. In addition, each of Redwood’s NEOs has entered into an employment agreement with Redwood, which provide for severance payments and vesting (or, as applicable, non-forfeiture) of equity-related awards in the event Redwood terminates the executive’s employment without “cause” or the executive terminates his or her employment for “good reason” outside of a change of control context. These employment agreements also provide for payments and vesting of equity-related awards in the event of the executive’s death or disability. These agreements were entered into in order to attract and retain these executives in the competitive marketplace for executive talent. In the event of a “change of control,” these employment agreements provide for vesting of long-term incentive awards only after a “double trigger” — meaning that no awards would vest unless the executive is terminated without “cause” or, in certain cases, terminates his or her employment with “good reason,” following such a “change of control.” In addition, under these employment agreements, following a “change of control,” if the surviving or acquiring corporation does not assume outstanding long-term incentive awards or substitute equivalent awards, then the long-term incentive awards will generally vest in full. Within the employment agreement of each executive officer, Redwood’s entry into an agreement with a third-party management company to externally manage all or substantially all of Redwood’s assets and/or operations is referred to as an “externalization of management” and is generally treated analogously to a “change of control”. For all NEOs, under the award agreements governing outstanding PSUs (and any outstanding cash-settled PSUs), in the event of a “change of control,” the per share price paid in connection with the change of control will be used to calculate TSR when determining performance-based vesting that is based on TSR. When applicable, absolute TSR performance goals will be annualized to reflect the number of days completed in the performance-measurement period (from the first day of the period through the closing date of the change of control). The various levels of post-termination benefits for each of the NEOs were determined by the Committee to be appropriate based on that executive’s duties and responsibilities with Redwood and were the result of arm’s-length negotiations with these individuals. The different levels were also determined to be appropriate and reasonable when compared to post-termination benefits provided by Redwood’s peers to executives with similar titles and similar levels of responsibility. The levels of benefit were also intended to take into account the expected length of time and difficulty the executive may experience in trying to secure new employment. The amount of the severance is balanced against Redwood’s need to be responsible to its stockholders and also considers the potential impact the severance payments may have on other potential parties to a “change in control” transaction. The terms of the severance and change of control arrangements that were in place with NEOs at the end of 2024 are described in more detail below under “Potential Payments upon Termination or Change of Control.” Redwood does not provide for excise tax gross-ups for change-in-control severance payments. Redwood does not have any agreements in place with any NEO (or any other employee) that provide for an excise tax gross-up for a change-in-control severance payment, whether imposed under Section 280G of the Internal Revenue Code of 1986, as amended (the “Code”) or otherwise. The Committee does not intend to offer any such excise tax gross-up provisions in any future agreements.

  64. Severance and Change of Control Arrangements

    | Section IV - Compensation-Related Policies and Tax Considerations | | | | | ➢ | Mandatory Executive Stock Ownership Requirements | | | ➢ | Prohibition on Use of Margin, Pledging, and Hedging in Respect of Redwood Securities | | | ➢ | Clawback Policy | | | ➢ | Tax Considerations | | | ➢ | Accounting Standards |

  65. Accounting Standards

    Accounting Standards Under GAAP, ASC Topic 718 requires Redwood to calculate the grant date “fair value” of certain long-term incentive awards using a variety of assumptions. ASC Topic 718 also requires Redwood to recognize an expense for the fair value of certain equity-based and other long-term incentive compensation awards. Grants of deferred stock units, cash-settled deferred stock units, restricted stock, restricted stock units, cash-settled restricted stock units, performance stock units, and cash-settled performance stock units will be accounted for under ASC Topic 718. The Compensation Committee regularly considers the accounting implications of significant compensation decisions, especially in connection with decisions that relate to equity incentive award plans and programs. As accounting standards change, the Committee may revise certain programs to align appropriately the accounting expense of equity awards with Redwood’s overall executive compensation philosophy and objectives.

  66. Accounting Standards

    | Section V - Conclusion | | | | | ➢ | Certain Compensation Determinations Relating to 2025 | | | ➢ | 2025 Maximum Total Annual Bonuses | | | ➢ | Compensation Committee Report |

  67. Certain Compensation Determinations Relating to 2025

    2025 Targets for Performance-Based Annual Bonuses. In December 2025, the Committee established a 2025 target annual bonus for each of Redwood’s NEOs. The table below sets forth the 2025 target annual bonuses for each of these NEOs.

  68. Certain Compensation Determinations Relating to 2025

    | NEOs | 2025 Base Salary | 2025 Target Annual Bonus (%) | Change from 2024 Target Annual Bonus Percentage (%)(1) | Total 2025 Target Annual Bonus ($) | | Mr. Abate, Chief Executive Officer | $975,000 | 215% | 7.5% | $2,096,250 | | Mr. Robinson, President | $890,000 | 210% | 7.7% | $1,869,000 | | Ms. Carillo, Chief Financial Officer | $860,000 | 205% | 7.9% | $1,763,000 | | Ms. Macomber, Chief Human Resource Officer | $525,000 | 175% | 0% | $918,750 | | Mr. Stone, Executive Vice President and Chief Legal Officer | $525,000 | 175% | 0% | $918,750 |

  69. Certain Compensation Determinations Relating to 2025

    (1) Amounts set forth in the table under “Change from 2024 Target Annual Bonus Percentage (%)” reflect the increase, if any, in the 2025 Target Annual Bonus (%) from the 2024 Target Annual Bonus (%) in effect for each NEO at the end of 2024.

  70. 2025 Maximum Total Annual Bonuses

    2025 Maximum Total Annual Bonuses As discussed under the heading “2024 Performance-Based Annual Bonus Compensation” on pages 58-62 within this CD&A, in the fourth quarter of 2023 the Committee lowered the maximum annual bonus opportunity for the CEO and the other executive officers from 3.5x to 3.0x of their target annual bonuses – marking the second reduction to maximum annual bonus opportunities for executive officers since 2022.

  71. Summary Compensation

    | Name and Principal Position | Year | Salary | Bonus | Stock Awards (1) | Non-Equity Incentive Plan Compensation(2) | All Other Compensation(3) | Total | | Christopher J. Abate, Chief Executive Officer | 2024 | $950,000 | — | $4,349,994 | $1,573,696 | $94,917 | $6,968,607 | | | 2023 | $900,000 | — | $4,099,997 | $1,967,782 | $54,000 | $7,021,779 | | | 2022 | $900,000 | — | $3,999,993 | $450,000 | $55,000 | $5,404,993 | | Dashiell I. Robinson, President | 2024 | $875,000 | — | $3,599,992 | $1,413,221 | $87,500 | $5,975,713 | | | 2023 | $850,000 | — | $3,499,988 | $1,711,370 | $51,000 | $6,112,358 | | | 2022 | $825,000 | — | $3,249,981 | $509,438 | $49,500 | $4,633,919 | | Brooke E. Carillo, Chief Financial Officer | 2024 | $825,000 | | $3,499,988 | $1,337,487 | $84,500 | $5,746,975 | | | 2023 | $800,000 | | $7,249,983 | $1,001,287 | $48,000 | $9,099,270 | | | 2022 | $700,000 | | $2,999,987 | $505,000 | $42,000 | $4,246,987 | | Andrew P. Stone, Executive Vice-President and Chief Legal Officer | 2024 | $500,000 | — | $1,499,990 | $702,853 | $31,000 | $2,733,843 | | | 2023 | $450,000 | — | $1,499,988 | $689,168 | $28,000 | $2,667,156 | | | 2022 | $445,000 | — | $1,249,990 | $250,313 | $27,700 | $1,973,003 | | Sasha G. Macomber, Chief Human Resource Officer | 2024 | $500,000 | — | $1,499,990 | $702,853 | $46,500 | $2,749,343 | | | 2023 | $450,000 | — | $1,499,988 | $506,251 | $11,250 | $2,467,489 | | | 2022 | $425,000 | — | $1,249,990 | $322,396 | $10,250 | $2,007,636 |

  72. Grants of Plan-Based Awards

    Grants of Plan-Based Awards The following table reflects estimated possible payouts to the NEOs for 2024 under Redwood’s performance-based bonus compensation program, as well as grants of plan-based awards made in 2024 under Redwood’s Incentive Plan. Actual bonus payments for 2024 are reflected in the “Summary Compensation” table above. As discussed above under “Compensation Discussion and Analysis — 2024 Performance-Based Annual Bonus Compensation,” 2024 target annual performance-based bonuses for 2024 were structured to be earned on a weighted basis based on Adjusted ROE (37.5%), Adjusted EAD ROE (37.5%), and on individual contributions to the Company’s pre-established annual strategic, operational, and risk management goals for 2024 (25%). For 2024, total annual bonuses were subject to the overall maximum amounts (caps) set forth in the following table.

  73. Grants of Plan-Based Awards

    | Name | Type of Award(1) | Grant Date | Estimated Possible Payouts Under Non-Equity Incentive Plan Awards ($)(4) | | | Estimated Possible Payouts Under Equity Incentive Plan Awards ($) | | | All Other Stock Awards: Number of Shares of Stock or Units (#) | Grant Date Fair Value of Stock and Option Awards ($) (7) | | | | | Threshold | Target | Maximum | Threshold | Target (5) | Maximum (6) | | | | Christopher J. Abate | Annual Bonus | — | — | 1,900,000 | 5,700,000 | — | — | — | — | — | | | DSU (2) | 12/19/2024 | — | — | — | — | — | — | 98,268 | 652,500 | | | csRSU (2) | 12/19/2024 | | | | | | | 196,536 | 1,304,999 | | | PSU (3) | 12/19/2024 | — | — | — | — | 318,893 | 797,233 | — | 2,392,495 | | Dashiell I. Robinson | Annual Bonus | | — | 1,706,250 | 5,118,750 | — | — | — | — | — | | | DSU (2) | 12/19/2024 | — | — | — | — | — | — | 92,168 | 611,996 | | | csRSU (2) | 12/19/2024 | — | — | — | — | — | — | 178,915 | 1,187,996 | | | PSU (3) | 12/19/2024 | — | — | — | — | 239,920 | 599,800 | — | 1,800,000 | | Brooke E. Carillo | Annual Bonus | — | — | 1,567,500 | 4,702,500 | — | — | — | — | — | | | DSU (2) | 12/19/2024 | — | — | — | — | — | — | 89,608 | 594,997 | | | csRSU (2) | 12/19/2024 | — | — | — | — | — | — | 173,945 | 1,154,995 | | | PSU (3) | 12/19/2024 | — | — | — | — | 233,255 | 583,138 | — | 1,749,996 | | Andrew P. Stone | Annual Bonus | — | — | 875,000 | 2,625,000 | — | — | — | — | — | | | DSU (2) | 12/19/2024 | — | — | — | — | — | — | 38,403 | 254,996 | | | csRSU (2) | 12/19/2024 | — | — | — | — | — | — | 74,548 | 494,999 | | | PSU (3) | 12/19/2024 | — | — | — | — | 99,966 | 249,915 | — | 749,995 | | Sasha G. Macomber | Annual Bonus | — | — | 875,000 | 2,625,000 | — | — | — | — | — | | | DSU (2) | 12/19/2024 | — | — | — | — | — | — | 38,403 | 254,996 | | | csRSU (2) | 12/19/2024 | — | — | — | — | — | — | 74,548 | 494,999 | | | PSU (3) | 12/19/2024 | — | — | — | — | 99,966 | 249,915 | — | 749,995 |

  74. Grants of Plan-Based Awards

    (1) DSU refers to deferred stock units, csDSU refers to cash-settled deferred stock units, csRSU refers to cash-settled restricted stock units, and PSU refers to performance stock units. (2) Mr. Abate received a 2024 annual long-term equity-based award in December 2024 and received 15% of that award value in the form of deferred stock units and 30% cash-settled restricted stock units on December 19, 2024. Each of Mr. Robinson, Ms. Carillo, Mr. Stone and Ms. Macomber also received a 2024 annual long-term equity-based award in December 2024 and received 17% of that award value in the form of deferred stock units and 33% in cash-settled restricted stock units on December 19, 2024. Deferred stock units and cash-settled restricted stock units were granted with a grant date fair value of $6.64 per share subject to a four-year vesting schedule (fully vesting on December 18, 2028). (3) Mr. Abate received a 2024 annual long-term equity-based award in December 2024 and received 55% of that award value in the form of a target number of performance stock units on December 19, 2024. The other NEOs also received a 2024 annual long-term equity-based award in December 2024 and received one-half of that award value in the form of a target number of performance stock units on December 19, 2024. The performance stock units were granted with a grant date fair value of $7.5025 per unit. Vesting of these performance stock units will generally occur, if at all, as of January 1, 2028 based on a three-step process, as described on pages 66-68 of this Proxy Statement under the heading “Compensation Discussion and Analysis – 2024 Long-Term Equity-Based Incentive Awards – Performance-Based Vesting – PSUs Granted in December 2024.” (4) The amounts reported in the “Estimated Possible Payouts Under Non-Equity Incentive Plan Awards” column reflect the target, threshold and maximum payouts for each of the NEOs under Redwood’s performance-based bonus compensation program, which were structured to be earned based on Redwood’s 2024 Adjusted ROE, Redwood’s 2024 Adjusted EAD ROE and individual contributions to the Company’s pre-established annual strategic, operational and risk management goals for 2024. See “Compensation Discussion and Analysis — 2024 Performance-Based Annual Bonus Compensation” beginning on pages 58-62 for a more complete description of the Company’s performance-based annual bonus program. Actual bonus amounts awarded to NEOs for 2024 are reflected above in the “Summary Compensation” table. (5) Represents the target number of shares to be awarded upon the contingent vesting of performance stock units as discussed above in Note 3. Information regarding the assumptions used to value our NEOs’ stock units is provided in Note 21 to our consolidated financial statements included in Redwood’s Annual Report on Form 10-K filed on March 3, 2025. (6) For December 2024 awards of performance stock units, represents the maximum number of shares that could contingently vest, as discussed above in Note 3, subject to any adjustment of the target number of performance stock units granted to reflect the value of any dividends paid on Redwood common stock during the vesting period. The maximum potential value of the performance stock units granted in December 2024 to Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone and Ms. Macomber (assuming the maximum number of units vest and calculated based on the closing price of Redwood’s common stock on the NYSE on the grant date) are $5,293,624, $3,982,672, $3,872,033, $1,659,436 and $1,659,436 respectively, assuming the Company achieves the maximum performance goals during the performance period and that there is no adjustment to the target number of units to reflect the value of any dividends paid on Redwood common stock during the vesting period. Information regarding the assumptions used to value our NEOs’ stock units is provided in Note 21 to our consolidated financial statements included in Redwood’s Annual Report on Form 10-K filed on March 3, 2025. (7) These awards were approved by the Compensation Committee of the Board of Directors and granted pursuant to Redwood’s 2014 Incentive Plan. The value of these awards is determined in accordance with FASB Accounting Standards Codification Topic 718 based on, among other things, the closing price of Redwood’s common stock on the grant date.

  75. Outstanding Equity Awards at Fiscal Year-End

    Outstanding Equity Awards at Fiscal Year-End The following table sets forth certain information regarding outstanding equity awards for each NEO as of December 31, 2024.

  76. Outstanding Equity Awards at Fiscal Year-End

    | | Stock Awards | | | | | NEO | Number of Shares or Units of Stock That Have Not Vested (#)(1) | Market Value of Shares or Units of Stock That Have Not Vested ($)(2) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#)(3) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, That Have Not Vested ($)(4) | | Christopher J. Abate | 573,170 | $3,742,800 | 1,206,168 | $7,876,277 | | Dashiell I. Robinson | 636,827 | $4,158,480 | 760,808 | $4,968,076 | | Brooke E. Carillo | 1,070,550 | $6,990,692 | 670,401 | $4,377,719 | | Andrew P. Stone | 262,224 | $1,712,323 | 301,681 | $1,969,977 | | Sasha G. Macomber | 262,224 | $1,712,323 | 301,681 | $1,969,977 |

  77. Outstanding Equity Awards at Fiscal Year-End

    (1) Represents unvested deferred stock units, cash-settled deferred stock units and cash-settled restricted stock units as of December 31, 2024. The table below shows the vesting schedule for these stock units as of December 31, 2024. Deferred stock units and cash-settled deferred stock units generally time-vest over four years as follows: 25% after the first year, and 6.25% every quarter thereafter. Cash-settled restricted stock units generally time-vest over four years as follows: 25% after each annual anniversary of the grant date. Deferred stock unit, cash-settled deferred stock unit and cash-settled restricted stock unit awards relating to the schedule below were granted from December 2021 through December 2024.

  78. Outstanding Equity Awards at Fiscal Year-End

    | Total DSUs Scheduled to Vest On: | Christopher J. Abate | Dashiell I. Robinson | Brooke E. Carillo | Andrew P. Stone | Sasha G. Macomber | | 1/1/2025 | 7,113 | 12,160 | 9,560 | 4,403 | 4,403 | | 1/31/2025 | 29,606 | 28,081 | 265,309 | 12,035 | 12,035 | | 4/1/2025 | 14,515 | 19,181 | 16,079 | 7,412 | 7,412 | | 7/1/2025 | 14,515 | 19,181 | 16,079 | 7,412 | 7,412 | | 10/1/2025 | 14,515 | 19,180 | 16,079 | 7,412 | 7,412 | | 12/13/2025 | 7,113 | 5,335 | 3,260 | 1,778 | 1,778 | | 1/1/2026 | 7,401 | 13,845 | 12,819 | 5,634 | 5,634 | | 1/31/2026 | 24,567 | 23,042 | 22,402 | 9,601 | 9,601 | | 4/1/2026 | 13,543 | 19,606 | 18,420 | 8,035 | 8,035 | | 7/1/2026 | 13,543 | 19,606 | 18,420 | 8,035 | 8,035 | | 10/1/2026 | 13,543 | 19,606 | 18,420 | 8,034 | 8,034 | | 12/14/2026 | — | 6,825 | 6,300 | 2,625 | 2,625 | | 1/1/2027 | 13,543 | 12,781 | 12,120 | 5,408 | 5,408 | | 1/31/2027 | — | — | 239,234 | — | — | | 4/1/2027 | 13,543 | 12,781 | 12,120 | 5,408 | 5,408 | | 7/1/2027 | 13,543 | 12,781 | 12,119 | 5,408 | 5,408 | | 10/1/2027 | 13,543 | 12,780 | 12,118 | 5,408 | 5,408 | | 12/14/2027 | 7,401 | — | 6,518 | 3,008 | 3,008 | | 1/1/2028 | 6,142 | 5,760 | 5,600 | 2,400 | 2,400 | | 4/1/2028 | 6,142 | 5,760 | 5,600 | 2,400 | 2,400 | | 7/1/2028 | 6,141 | 5,760 | 5,600 | 2,400 | 2,400 | | 10/1/2028 | 6,141 | 5,760 | 5,600 | 2,400 | 2,400 | | 12/18/2028 | 6,141 | 5,760 | 5,600 | 2,400 | 2,400 | | TOTAL | 252,254 | 285,573 | 745,379 | 119,058 | 119,058 |

  79. Outstanding Equity Awards at Fiscal Year-End

    [Additional table that accompanies this footnote (1) is set forth on the following page.]

  80. Outstanding Equity Awards at Fiscal Year-End

    | Total csDSUs Scheduled to Vest On: | Christopher J. Abate | Dashiell I. Robinson | Brooke E. Carillo | Andrew P. Stone | Sasha G. Macomber | | 1/1/2025 | 7,113 | 12,160 | 9,561 | 4,403 | 4,403 | | 4/1/2025 | 7,113 | 12,160 | 9,560 | 4,403 | 4,403 | | 7/1/2025 | 7,113 | 12,159 | 9,560 | 4,403 | 4,403 | | 10/1/2025 | 7,113 | 12,159 | 9,560 | 4,403 | 4,403 | | 12/14/2025 | 7,113 | 5,334 | 3,260 | 1,778 | 1,778 | | 1/1/2026 | — | 6,825 | 6,300 | 2,625 | 2,625 | | 4/1/2026 | — | 6,825 | 6,300 | 2,625 | 2,625 | | 7/1/2026 | — | 6,825 | 6,300 | 2,625 | 2,625 | | 10/1/2026 | — | 6,825 | 6,300 | 2,625 | 2,625 | | 12/14/2026 | — | 6,825 | 6,300 | 2,625 | 2,625 | | TOTAL | 35,565 | 88,097 | 73,001 | 32,515 | 32,515 |

  81. Outstanding Equity Awards at Fiscal Year-End

    | Total csRSUs Scheduled to Vest On: | Christopher J. Abate | Dashiell I. Robinson | Brooke E. Carillo | Andrew P. Stone | Sasha G. Macomber | | 12/14/2025 | 29,605 | 28,081 | 26,075 | 12,035 | 12,035 | | 12/18/2025 | 49,134 | 44,729 | 43,487 | 18,637 | 18,637 | | 12/14/2026 | 29,605 | 28,081 | 26,075 | 12,034 | 12,034 | | 12/18/2026 | 49,134 | 44,729 | 43,486 | 18,637 | 18,637 | | 12/14/2027 | 29,605 | 28,080 | 26,075 | 12,034 | 12,034 | | 12/18/2027 | 49,134 | 44,729 | 43,486 | 18,637 | 18,637 | | 12/18/2028 | 49,134 | 44,728 | 43,486 | 18,637 | 18,637 | | TOTAL | 285,351 | 263,157 | 252,170 | 110,651 | 110,651 |

  82. Outstanding Equity Awards at Fiscal Year-End

    (2) Assumes a common stock value of $6.53 per share (the closing price of Redwood’s common stock on the NYSE on December 31, 2024). (3) Represents unearned performance stock units, including cash-settled performance stock units, as of December 31, 2024. Performance stock units are performance-based equity awards under which the number of underlying shares of Redwood common stock that vest and that the award recipient becomes entitled to receive at the time of vesting (or, in the case of cash-settled performance stock units, the cash payment in respect of underlying reference shares) will generally range from 0% to 250% of the number of PSUs granted based on absolute, book value, and/or relative total shareholder return goals over the three-year performance period. Performance stock units are generally granted annually and vest, if at all, at the end of the three-year performance period, with the number of PSUs granted being adjusted to reflect the value of any dividends paid on shares of common stock during the vesting period. The tables below shows the vesting schedule for unearned performance stock units and cash-settled performance stock units, as of December 31, 2024. The number of PSUs shown below is dependent on the interim performance of the respective PSU grants as of December 31, 2024 and does not reflect any adjustment to the number of PSUs granted to reflect the value of any dividends paid on shares of common stock during the vesting period. Grant(s) performing at below-target level on December 31, 2024 are reflected as target number of shares, and grant(s) performing at above-target level on December 31, 2024 are reflected as the maximum number of shares that can be earned. The performance stock unit awards relating to the tables below were granted from December 2021 to December 2024. [Additional table that accompanies this footnote (3) is set forth on the following page.]

  83. Outstanding Equity Awards at Fiscal Year-End

    | PSUs Scheduled to Vest On: | PSUs Shown | Christopher J. Abate | Dashiell I. Robinson | Brooke E. Carillo | | Andrew P. Stone | Sasha G. Macomber | | 1/1/2025 | Target | 191,326 | 143,494 | 87,691 | | 47,831 | 47,831 | | 1/1/2026 | Target | 439,961 | 178,734 | 164,985 | | 68,744 | 68,744 | | 1/1/2027 | Target | 255,988 | 198,660 | 184,470 | | 85,140 | 85,140 | | 1/1/2028 | Target | 318,893 | 239,920 | 233,255 | | 99,966 | 99,966 | | | TOTAL | 1,206,168 | 760,808 | 670,401 | 670,401 | 301,681 | 301,681 |

  84. Outstanding Equity Awards at Fiscal Year-End

    (4) Represents the applicable number of PSUs, including cash-settled performance stock units, multiplied by a value per share of $6.53 (the closing price of Redwood common stock on the NYSE on December 31, 2024). Please refer to the preceding “Grants of Plan-Based Awards” table for additional detail on the vesting of PSUs.

  85. Options Exercised and Stock Vested

    Options Exercised and Stock Vested The following table sets forth the value of accumulated deferred stock unit awards, cash-settled deferred stock units, cash-settled restricted stock units and performance stock unit awards that vested during 2024 for each NEO. As of December 31, 2024, and as of the date of this Proxy Statement, there were no stock options outstanding under Redwood’s 2014 Incentive Award Plan.

  86. Options Exercised and Stock Vested

    | | Stock Awards | | | NEO | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($)(1) | | Christopher J. Abate | 367,869 | $2,659,809 | | Dashiell I. Robinson | 353,890 | $2,508,616 | | Brooke E. Carillo | 140,363 | $960,030 | | Andrew P. Stone | 141,788 | $1,006,941 | | Sasha G. Macomber | 125,156 | $884,342 |

  87. Options Exercised and Stock Vested

    (1) The value realized on vesting is calculated by multiplying the number of shares vesting by the fair market value of Redwood’s stock on the respective vesting date.

  88. Non-Qualified Deferred Compensation

    Non-Qualified Deferred Compensation Our Executive Deferred Compensation Plan permits eligible employees to voluntarily defer receipt of a portion or all of their salary, bonus, and/or dividend equivalent right payments on a tax-deferred basis for distribution from the plan to the employee at a later date, and deferred stock units awarded to eligible employees can also be deferred for distribution from the plan at a later date. Distributions of deferred stock units and voluntary cash amounts deferred under the Executive Deferred Compensation Plan are distributed according to the date provided in a deferral election form or related award agreement, in accordance with the terms and conditions of the Executive Deferred Compensation Plan. The earliest permissible distribution date for deferred stock units is generally four years after the grant date, when they have vested in full. The earliest distribution date of voluntary cash amounts deferred is the May 1 that occurs sixteen months after the end of the plan year in which the deferral occurred. Most of our NEOs participate in our Executive Deferred Compensation Plan. Each of Mr. Abate, Mr. Robinson, Ms. Carillo and Mr. Stone voluntarily deferred a portion of his or her cash earnings during fiscal year 2024. Interest accrual in respect of cash amounts deferred in our Executive Deferred Compensation Plan is described above under “Compensation Discussion and Analysis — Deferred Compensation.” Our NEOs are also entitled to a Redwood matching contribution on all or a portion of their deferred cash compensation, subject to vesting requirements and a matching contribution limit, as described above under “Compensation Discussion and Analysis — Deferred Compensation.” As of December 31, 2024, all of our NEOs were fully vested in matching payments made under our Executive Deferred Compensation Plan. The following table sets forth information with respect to our NEOs’ cash contributions, vested deferred stock unit contributions, cash and deferred stock unit withdrawals, earnings, and aggregate balances in our Executive Deferred Compensation Plan for the fiscal year ended December 31, 2024.

  89. Non-Qualified Deferred Compensation

    | NEO | Executive Contributions in 2024 | Redwood Matching Contributions in 2024 | Aggregate Earnings in 2024(1) | Aggregate Withdrawals/ Distributions in 2024 | Aggregate Balance at 12/31/2024(2) | | Christopher J. Abate(3) | $2,750,809 | $45,500 | $15,740 | $(2,829,799) | $1,305,073 | | Dashiell I. Robinson(4) | $2,590,616 | $41,000 | $12,257 | $(1,919,849) | $1,699,783 | | Brooke E. Carillo(5) | $1,036,030 | $38,000 | $13,450 | $(91,775) | $1,296,561 | | Andrew P. Stone(6) | $1,043,941 | $18,500 | $4,882 | $(805,561) | $603,184 | | Sasha G. Macomber(7) | $884,342 | $— | $— | $(673,705) | $495,470 |

  90. Non-Qualified Deferred Compensation

    (1)Represents market rate interest earned on cash balances in our Executive Deferred Compensation Plan. “Market rate interest” is defined as 120% of long-term applicable federal rate compounded monthly, as published by the IRS. (2)Reflects the value of vested stock units, assuming a price of $6.53 per share (the closing price of Redwood common stock on the NYSE on December 31, 2024), and the cash balance in the Executive Deferred Compensation Plan, all of which has been previously reported as compensation in 2024 or in prior years. (3)Mr. Abate’s contribution included $91,000 in voluntary cash deferrals from his 2024 compensation (reported as compensation in the “Summary Compensation” table above) and $2,659,809 as a result of vesting of previously awarded deferred stock units, cash-settled deferred stock units and performance stock units (reported as compensation in previous years). Mr. Abate received a distribution of 321,448 shares of common stock underlying deferred stock units and performance stock units awarded in 2020. Mr. Abate also received $762,183 related to the settlement of cash-settled deferred stock units awarded in 2020. (4)Mr. Robinson’s contribution included $82,000 in voluntary cash deferrals from his 2024 compensation (reported as compensation in the “Summary Compensation” table above) and $2,508,616 as a result of vesting of previously awarded deferred stock units, cash-settled deferred stock units and performance stock units (reported as compensation in previous years). Mr. Robinson received a distribution of 214,298 shares of common stock underlying deferred stock units and performance stock units awarded in 2020. Mr. Robinson also received $508,119 related to the settlement of cash-settled deferred stock units awarded in 2020. (5)Ms. Carillo’s contribution included $76,000 in voluntary cash deferrals from her 2024 compensation (reported as compensation in the “Summary Compensation” table above) and $960,030 as a result of vesting of previously awarded deferred stock units and cash-settled deferred stock units (reported as compensation in previous years). (6)Mr. Stone’s contribution included $37,000 in voluntary cash deferrals from his 2024 compensation (reported as compensation in the “Summary Compensation” table above) and $1,006,941 as a result of vesting of previously awarded deferred stock units, cash-settled deferred stock units and performance stock units (reported as compensation in previous years). Mr. Stone received a distribution of 90,004 shares of common stock underlying deferred stock units and performance stock units awarded in 2020. Mr. Stone also received $213,408 related to the settlement of cash-settled deferred stock units awarded in 2020. (7)Ms. Macomber’s contribution included $884,342 as a result of vesting of previously awarded deferred stock units, cash-settled deferred stock units and performance stock units. Ms. Macomber received a distribution of 85,571 shares of common stock underlying deferred stock units and performance stock units awarded in 2020. Ms. Macomber also received $162,600 related to the settlement of cash-settled deferred stock units awarded in 2020.

  91. Potential Payments upon Termination or Change of Control

    Potential Payments upon Termination or Change of Control In 2024, each of Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber had an employment agreement in place with Redwood that provides for cash severance payments, vesting of long-term equity-based incentive awards and other long-term incentive awards, and other benefits in the event the executive is terminated without “cause” or the executive terminates employment for “good reason,” each as defined in the applicable agreement. As compensation for employment prior to the date of any such termination, these employment agreements also provide for payment of base salary through the date of any such termination, as well as, in the event of a “change of control” a performance-based bonus payment, pro-rated as applicable, through the date of any such termination. Within these employment agreements, Redwood’s entry into an agreement with a third-party management company to externally manage all or substantially all of Redwood’s assets and/or operations is referred to as an “externalization of management” and is generally treated analogously to a “change of control”, and within this “Potential Payments upon Termination or Change of Control” section (and the tables set forth herein) the term “change of control” generally includes any such externalization of management. These employment agreements provide for a one-year term of service ending on December 31 of each year and are subject to automatic one-year renewals if not terminated by either party. In particular, the employment agreements with each of Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber provide for the applicable executive to receive a cash severance payment in the event Redwood terminates the executive’s employment without “cause” or the executive terminates employment for “good reason.” The cash severance payments to these executives under these agreements in respect of any such termination are in addition to compensation for employment prior to the date of any such termination and, in each case, would be equal to the executive’s target annual bonus prorated through the date of termination plus the amount of additional cash severance specified in the table below.

  92. Potential Payments upon Termination or Change of Control

    | | | Additional Cash Severance | | | | | In Connection With a | Other Than in Connection With a | | Name | | Change of Control (1) | Change of Control | | Christopher J. Abate | | 2x the sum of Base Salary plus Target Annual Bonus (2) | 1.5x the sum of Base Salary plus Target Annual Bonus | | Dashiell I. Robinson | | 1.5x the sum of Base Salary plus Target Annual Bonus(3) | 1x the sum of Base Salary plus Target Annual Bonus | | Brooke E. Carillo | | 1.25x the sum of Base Salary plus Target Annual Bonus(4) | 1x the sum of Base Salary plus Target Annual Bonus | | Andrew P. Stone | | 1x the sum of Base Salary plus Target Annual Bonus(5) | 0.75x the sum of Base Salary plus Target Annual Bonus(7) | | Sasha G. Macomber | | 1x the sum of Base Salary plus Target Annual Bonus(6) | 0.75x the sum of Base Salary plus Target Annual Bonus | | (1) | As noted above, within this table and the tables set forth below, the term “Change of Control” generally includes an “externalization of management”. | | | | (2) | The total of the amount of the Additional Cash Severance in Connection With a Change of Control and the amount of the pro-rated target annual bonus, cannot exceed $7.5 million | | | | (3) | The total of the amount of the Additional Cash Severance in Connection With a Change of Control and the amount of the pro-rated target annual bonus cannot exceed $5.5 million | | | | (4) | The total of the amount of the Additional Cash Severance in Connection With a Change of Control and the amount of the pro-rated target annual bonus cannot exceed $5 million | | | | (5) | The total of the amount of the Additional Cash Severance in Connection With a Change of Control and the amount of the pro-rated target annual bonus cannot exceed $2 million. | | | | (6) | The total of the amount of the Additional Cash Severance in Connection With a Change of Control and the amount of the pro-rated target annual bonus cannot exceed $2 million | | | | (7) | Subject to a minimum of 2x Base Salary plus pro-rated Base Salary. | | |

  93. Potential Payments upon Termination or Change of Control

    In addition, for Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber upon either such type of termination: (i) all outstanding time-based long-term equity-based incentive awards and other time-based long-term incentive awards will vest in full; and (ii) all outstanding performance-based long-term equity-based incentive awards and other performance-based long-term incentive awards will remain outstanding and continue to be eligible to vest in full or in part based on the achievement of relevant performance goals. Additionally, these five executives would be entitled to receive all life insurance, disability insurance, and medical coverage fringe benefits for periods ranging from nine to 24 months following termination of employment, depending on the individual executive and the type of termination. The employment agreements with Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber provide that 75% of severance amounts due will be paid in a lump sum six months following termination and the remaining 25% will be paid in equal monthly installments over the succeeding six months. The employment agreements with Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber do not provide excise tax gross-ups with respect to any excise taxes that may be imposed on change-in-control severance payments. The agreements provide that in the event that any payments or benefits under the employment agreements constitute an “excess parachute payment” for purposes of Section 280G of the Code, the amounts otherwise payable and benefits otherwise due under these employment agreements will either (i) be delivered in full or (ii) be reduced or limited to the minimum extent necessary to ensure that no payments will be subject to the excise tax imposed under Section 4999 of the Code, taking into account applicable federal, state and local income and employment taxes, whichever results in the largest benefit to the executive on an after-tax basis, notwithstanding that all or some portion of such payments and/or benefits may be subject to the excise tax imposed under Section 4999 of the Code. The payment and/or vesting of severance benefits under each employment agreement with these five executives may be contingent on the applicable executive executing a release of all claims against Redwood. To the extent enforceable under applicable law, each of the executives may be subject to non-solicitation restrictions for one year following a termination for which severance is paid. “Cause” for purposes of Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber’s employment agreements is defined as (i) the executive’s material failure to substantially perform the reasonable and lawful duties of his or her position for Redwood, including any habitual or repeated neglect if such duties, which failure has caused, or could reasonably be expected to cause, significant injury to the interests, property, operations, business or reputation of Redwood, and which failure shall continue to be uncured for thirty (30) days after written notice thereof by the Board of Directors to the executive; (ii) acts or omissions constituting gross negligence, recklessness or willful misconduct on the part of the executive in respect of the performance of his or her duties hereunder, his or her fiduciary obligations or otherwise relating to the business of Redwood, which failure has caused material injury to the interests, property, operations, business or reputation of Redwood, and which failure shall continue to be uncured for thirty (30) days after written notice thereof by the Board to the executive; (iii) unauthorized use or disclosure of trade secrets or confidential or proprietary information pertaining Redwood business, which use or disclosure has caused, or could reasonably be expected to cause significant injury to the interests, property, operations, business or reputation of Redwood, and which failure shall continue to be uncured for thirty (30) days after written notice thereof by the Board to the executive; (iv) acts or omissions constituting willful misconduct on the part of the executive in respect of the performance of his or her fiduciary duty of loyalty to Redwood, which failure has caused material injury to the interests, property, operations, business or reputation of Redwood; (v) theft or embezzlement, or attempted theft or embezzlement, of money, tangible, or intangible assets or property of Redwood or its employees, customers, clients, or others having business relations with Redwood; (vi) the executive’s conviction of, or plea of guilty or nolo contendere to, a non-vehicular felony, including, without limitation, a non-vehicular felony the elements of which involve fraud, dishonesty, or moral turpitude; (vii) the executive’s conviction of, or plea of guilty or nolo contendere to, a misdemeanor the elements of which involve fraud, dishonesty, or moral turpitude, and which is substantially related to the executive’s employment and duties to Redwood; or (viii) the executive’s commission of a crime the elements of which involve fraud, dishonesty, or moral turpitude, and which has caused, or could reasonably be expected to cause, material injury to the interests, property, operations, business or reputation of Redwood. “Good reason” for purposes of Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber’s employment agreements is defined as the occurrence, without the executive’s written consent, of (i) a material reduction in the executive’s responsibilities, title, duties or authority; (ii) a reduction in the executive’s base salary or target annual bonus, or a material reduction by Redwood in the value of the executive’s total compensation package if such a reduction is not made in proportion to an across-the-board reduction of all senior executives of Redwood; (iii) the relocation of the executive’s principal office to a location not within a designated area in proximity to the executive’s current principal office; (iv) a failure at any time to renew the employment agreement; (v) the complete liquidation of Redwood; or (vi) in the event of a merger, consolidation, transfer, or closing of a sale of all or substantially all the assets of Redwood, the failure of the successor company to affirmatively adopt the employment agreement. In the event of a “change of control” (as defined below) in which the surviving or acquiring corporation does not assume outstanding long-term equity-based incentive awards and other long-term incentive awards or substitute equivalent awards, outstanding long-term equity-based incentive awards and other long-term incentive awards for all the executives will immediately vest and become exercisable. In the event of a “change of control” in which outstanding long-term equity-based incentive awards and other long-term incentive awards are assumed or substituted, then acceleration only would occur upon a qualifying employment termination as specified in the award agreement for such award or the executives’ employment agreements. The number or amount of any outstanding performance-based long-term equity-based incentive awards or other long-term incentive awards eligible to vest will be determined by reference to the applicable performance goals for each such award, pro-rated on an annualized basis to reflect the shortened performance period.

  94. Potential Payments upon Termination or Change of Control

    In addition, in the event of a termination due to the executive’s death or disability, the employment agreements with Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber provide for (i) the payment to the executive or his or her estate of (a) the executive’s base salary to the date of termination, and (b) the executive’s target annual bonus for the year, prorated to the date of termination (as well as any earned but unpaid annual bonus from a prior service year (as and when such bonus becomes payable generally)), (ii) vesting in full of all long-term equity-based incentive awards and other long-term incentive awards with time-based vesting, and (iii) with respect to long-term equity-based incentive awards and other long-term incentive awards with performance-based vesting, such awards to remain outstanding and to continue to be eligible to vest and become payable based on the number of target shares or granted award value and the performance goals set forth in the applicable award agreement by which such awards are evidenced, in each case unless otherwise provided in the award agreement for the award. With respect to the employment agreements with Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber, “change of control” is defined as follows: (1) a transaction or series of transactions (other than an offering of common stock to the general public through a registration statement filed with the Securities and Exchange Commission or a transaction or series of transactions that meets the requirements of clauses (a) and (b) of subsection (3) below) whereby any “person” or related “group” of “persons” (as such terms are used in Sections 13(d) and 14(d)(2) of the Securities Exchange Act of 1934, as amended) (other than Redwood, any of its subsidiaries, an employee benefit plan maintained by Redwood or any of its subsidiaries or a “person” that, prior to such transaction, directly or indirectly controls, is controlled by, or is under common control with, Redwood) directly or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of securities of Redwood possessing more than 30% of the total combined voting power of Redwood’s securities outstanding immediately after such acquisition; or (2) during any period of two consecutive years, individuals who, at the beginning of such period, constitute the Board together with any new Director(s) (other than a Director designated by a person who shall have entered into an agreement with Redwood to effect a transaction described in subsections (1) or (3) of this definition) whose election by the Board or nomination for election by Redwood’s stockholders was approved by a vote of at least two-thirds of the Directors then still in office who either were Directors at the beginning of the two-year period or whose election or nomination for election was previously so approved, cease for any reason to constitute a majority thereof; or (3) the consummation by Redwood (whether directly involving Redwood or indirectly involving Redwood through one or more intermediaries) of (x) a merger, consolidation, reorganization, or business combination or (y) a sale or other disposition of all or substantially all of Redwood’s assets in any single transaction or series of related transactions or (z) the acquisition of assets or stock of another entity, in each case other than a transaction: a. which results in Redwood’s voting securities outstanding immediately before the transaction continuing to represent (either by remaining outstanding or by being converted into voting securities of Redwood or the person that, as a result of the transaction, controls, directly or indirectly, Redwood or owns, directly or indirectly, all or substantially all of Redwood’s assets or otherwise succeeds to the business of Redwood (Redwood or such person, the “Successor Entity”)) directly or indirectly, at least a majority of the combined voting power of the Successor Entity’s outstanding voting securities immediately after the transaction; and b. after which no person or group beneficially owns voting securities representing 30% or more of the combined voting power of the Successor Entity; provided, however, that no person or group shall be treated for purposes of this clause (ii) as beneficially owning 30% or more of the combined voting power of the Successor Entity solely as a result of the voting power held in Redwood prior to the consummation of the transaction. For additional information related to the employment agreements with Mr. Abate, Mr. Robinson, Ms. Carillo, Mr. Stone, and Ms. Macomber, please refer to Exhibits 10.29 through 10.33 to Redwood’s Annual Report on Form-K for the year ended December 31, 2024, filed on March 3, 2025.

  95. CEO Pay Ratio

    CEO Pay Ratio As required by Section 953(b) of the Dodd-Frank Wall Street Reform and Consumer Protection Act, and Item 402(u) of the SEC’s Regulation S-K, the following information is being provided regarding the ratio of the total compensation of Redwood’s median compensated employee to the total compensation of Redwood’s CEO during 2024. For 2024, Redwood’s most recently completed fiscal year: •Median Total Compensation – 2024. The annual total compensation of the employee who represents Redwood’s median compensated employee (excluding our CEO) was $137,984; and •CEO’s Total Annual Compensation – 2024. The annual total compensation of Redwood’s CEO was $6,968,607. CEO Pay Ratio of 51 to 1. Based on this information, for 2024, the estimated ratio of (x) the annual total compensation of Redwood’s CEO, to (y) the annual total compensation of Redwood’s median compensated employee, was 51 to 1. Determining the Median Compensated Employee •Employee Population As of December 31, 2024, Redwood’s employee workforce consisted of 283 full-time employees. However, for purposes of determining the median compensated employee, the Chief Executive Officer and one employee on permanent leave of absence were excluded. As a result, 281 of the 283 employees were included in the CEO Pay Ratio calculation. •Methodology for Determining Redwood’s Median Compensated Employee To identify the median compensated employee from Redwood’s employee population, a review of the annual total compensation of each of Redwood’s employees was conducted. For purposes of measuring the annual total compensation of each employee, Redwood selected base salary, overtime pay and bonus as the most appropriate measure of compensation, which was consistently applied to the 281 included employees. In identifying the median compensated employee, the compensation of permanent employees who were new hires in 2024 was annualized. •Compensation Measure and Annual Total Compensation of Median Compensated Employee With respect to the annual total compensation of the median compensated employee, Redwood calculated the elements of such employee’s compensation for 2024 in accordance with the requirements of Item 402(c)(2)(x) of Regulation S-K, resulting in annual total compensation of $137,984. •Annual Total Compensation of CEO With respect to the annual total compensation of Redwood’s CEO, Redwood used the annual total compensation amount as reported in the “Summary Compensation Table” in this proxy statement.

  96. Pay vs. Performance Comparison

    Pay vs. Performance Comparison As described within the Compensation Discussion and Analysis section of this Proxy Statement, Redwood maintains a performance-based compensation philosophy and program for its executive officers that seeks to provide incentives to achieve business goals and sustainable stockholder returns, align the interests of executive officers with those of long-term stockholders in achieving strong stockholder returns, and enable it to hire and retain talented individuals in a competitive marketplace. Accordingly, under Redwood’s executive compensation program, base salary and standard benefits are generally the only fixed elements of compensation, while performance-based components of compensation and long-term incentive awards represent the predominant forms of compensation for the CEO and other executive officers. A fulsome discussion of how the Compensation Committee has structured executive compensation at Redwood to be consistent with the Company’s performance-based compensation philosophy is included in the Compensation Discussion and Analysis section of this Proxy Statement beginning on page 47 above. The following table, the related footnotes, and the other disclosures set forth below in this “Pay vs. Performance Comparison” section of this Proxy Statement, have all been prepared in accordance with Section 953(a) of the Dodd-Frank Wall Street Reform and Consumer Protection Act and Item 402(v) of the SEC’s Regulation S-K, which were enacted and promulgated to, among other things, require the disclosure of information about the relationship between: (i) “Compensation Actually Paid” (as defined in Item 402(v) of Regulation S-K) to executives by a company over a specified period, and (ii) certain measures of the financial performance of the company over that period. During 2024 and early 2025, when the Compensation Committee made certain executive compensation determinations related to 2024 and 2025, the Compensation Committee did not directly consider the table, the related footnotes, and the other disclosures set forth below in this “Pay vs. Performance Comparison” section. Amounts designated as “Compensation Actually Paid” in the table, the related footnotes, and the other disclosures set forth below are calculated in accordance with Item 402(v) of Regulation S-K and do not necessarily represent amounts actually earned or realized by Redwood’s CEO or other executive officers in the periods presented or in any other period. In accordance with SEC regulations, within this “Pay vs. Performance Comparison” section the term “NEOs” refers to Redwood’s five Named Executive Officers.

  97. Pay vs. Performance Table

    Pay vs. Performance Table

  98. Pay vs. Performance Table

    | | | | | | Value of Initial Fixed $100 Investment Based on: | | | | | Year | Summary Compensation Table Total for PEO(1) | Compensation Actually Paid to PEO(1)(3) | Average Summary Compensation Table Total for Non-PEO NEOs(2) | Average Compensation Actually Paid to Non-PEO NEOs(2)(3) | Total Shareholder Return(4) | Peer Group Total Shareholder Return(5) | Net Income (Loss) (in millions) | Adjusted ROE(6) | | 2024 | $6,968,607 | $5,798,938 | $4,301,468 | $3,921,884 | $63 | $80 | $54 | 4.5% | | 2023 | $7,021,779 | $7,052,048 | $6,580,351 | $6,728,959 | $65 | $80 | $(2) | 0.1% | | 2022 | $5,404,993 | $(2,530,287) | $3,215,636 | $310,195 | $53 | $69 | $(164) | -11.4% | | 2021 | $13,598,971 | $17,746,852 | $6,713,889 | $7,987,344 | $92 | $94 | $320 | 26.3% | | 2020 | $5,552,321 | $165,376 | $2,191,888 | $280,033 | $57 | $81 | $(582) | -49.2% |

  99. Pay vs. Performance Table

    (1) PEO for 2024, 2023, 2022, 2021 and 2020 was Christopher J. Abate (2) The non-PEO named executive officers (NEOs) reflects the following individuals in each year: 2024: Dashiell I. Robinson, Brooke E. Carillo, Andrew P. Stone, Sasha G. Macomber 2023: Dashiell I. Robinson, Brooke E. Carillo, Fred J. Matera, Andrew P. Stone 2022: Dashiell I. Robinson, Brooke E. Carillo, Andrew P. Stone, Sasha G. Macomber 2021: Dashiell I. Robinson, Collin L. Cochrane, Andrew P. Stone, Sasha G. Macomber 2020: Dashiell I. Robinson, Collin L. Cochrane, Andrew P. Stone, Sasha G. Macomber, Shoshone ("Bo") Stern (3) The dollar amounts reported as “Compensation Actually Paid” represent the amount of “compensation actually paid”, as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual amount of compensation earned or paid during the applicable year. In accordance with the requirement of Item 402(v) of Regulation S-K, “Compensation Actually Paid” for 2024 is calculated by making the following adjustments from the Summary Compensation Table totals as follows:

  100. Pay vs. Performance Table

    | Item and Value Added (Deducted) | | | 2024 | | For PEO: | | | | | Summary Compensation Table Total | | | $6,968,607 | | | - | SCT “Stock Awards” column value | $(4,349,994) | | | + | year-end fair value of outstanding equity awards granted in Covered Year that remain unvested(*) | $4,343,773 | | + | / - | change in fair value of outstanding and unvested equity awards granted in prior years(*)(†) | $(1,650,554) | | + | / - | change in fair value of prior-year equity awards vested in Covered Year(*)(†) | $(54,717) | | | + | dividends paid on equity awards in the Covered Year prior to vesting date not otherwise included in total compensation for covered year | $541,823 | | Compensation Actually Paid(•) | | | $5,798,938 | | For Non-PEO Named Executive Officers (Average) | | | | | Summary Compensation Table Total | | | $4,301,468 | | | - | SCT “Stock Awards” column value | $(2,524,990) | | | + | year-end fair value of outstanding equity awards granted in Covered Year that remain unvested(*) | $2,517,904 | | + | / - | change in fair value of outstanding and unvested equity awards granted in prior years(*)(†) | $(753,657) | | + | / - | change in fair value of prior-year equity awards vested in Covered Year(*)(†) | $(53,152) | | | + | dividends paid on equity awards in the Covered Year prior to vesting date not otherwise included in total compensation for covered year | $434,311 | | Compensation Actually Paid(•) | | | $3,921,884 |

  101. Pay vs. Performance Table

    (*) Fair value of outstanding and unvested equity awards subject to financial performance-based vesting conditions (e.g., performance stock units), were determined using valuation assumptions, methodologies and market condition inputs (including, for example, risk-free interest rates and the following metrics related to Redwood common stock: market value, volatility, and dividend yield) that are generally consistent with those used to estimate fair value at grant date in accordance with ASC Topic 718. The fair values of these awards reflect an estimate of the probable outcome of the financial performance-based vesting conditions updated as of each measurement date. Fair value of the other equity and cash-settled awards is determined based on the closing market price of common stock on the applicable vesting date or as of December 31, 2024. The value of equity awards at vesting is determined by the closing market price of the number of shares of common stock that vest on the applicable vesting date. See “Equity Compensation Plans” in Note 21 to Consolidated Financial Statements contained in the Company’s Annual Report on Form 10-K for 2024, for further details on these equity and cash-settled awards and the assumptions made in valuing awards subject to financial performance-based vesting conditions at grant date and at measurement dates subsequent to grant date during the corresponding vesting periods. (†) Amounts represent changes in value from beginning of year to end of year or vesting date of individual awards. (•) Table does not include reconciling line items for (i) changes in pension benefits, (ii) awards that were granted and vested in the same year, or (iii) awards granted during a prior period that were forfeited during the Covered Year, as these items were not applicable for Redwood in 2024. (4) For the relevant fiscal year, represents the cumulative TSR of Redwood for the measurement periods ending on December 31 of each of 2024, 2023, 2022, 2021 and 2020, respectively, and in each case beginning on January 1, 2020. Cumulative TSR is calculated by dividing the sum of the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and the difference between the company’s share price at the end and the beginning of the measurement period by the company’s share price at the beginning of the measurement period. (5) For the relevant fiscal year, represents the cumulative TSR of the FTSE NAREIT Mortgage REIT Index (for purposes of this Pay vs. Performance Table, and in accordance with Item 402(v) of Regulation S-K, “Peer Group TSR”) for the measurement periods ending on December 31 of each of 2024, 2023, 2022, 2021 and 2020, respectively, and in each case beginning on January 1, 2020. (6) Adjusted ROE represents the “Company Selected Measure” as determined in accordance with Item 402(v) of Regulation S-K, and is a non-GAAP financial performance metric. Non-GAAP Adjusted ROE is further described on pages 58-59 within the Compensation Discussion and Analysis section of this Proxy Statement and within Annex B to this Proxy Statement. Analysis of Information Presented in the Pay vs. Performance Table The graphs below describe and illustrate the relationships between (i) the “Compensation Actually Paid” (CAP) to the PEO and the other NEOs, as set forth in the Pay vs. Performance table above, and (ii) Net Income (Loss), Adjusted ROE, and TSR (including TSR of the FTSE NAREIT Mortgage REIT Index).

  102. Pay vs. Performance Table

    | Relationship of CAP to Net Income (Loss) | | |

  103. Pay vs. Performance Table

    | Relationship of CAP to Adjusted Return on Equity (Adjusted ROE) | | |

  104. Pay vs. Performance Table

    | Relationship of CAP to Total Stockholder Return (TSR)** | | | | * As set forth in this graph, “Peer TSR” represents the annual TSR of the FTSE NAREIT Mortgage REIT Index for each of the years presented. ** For each year presented within this graph, Redwood TSR and Peer TSR represent annual TSR as measured from January 1st of such year to December 31st of each such year, based on an initial fixed $100 investment on each such January 1st. |

  105. Pay vs. Performance Table

    Financial Performance Measures Disclosed below are the most important financial measures used by the Company to link (i) “Compensation Actually Paid” to the Company’s Named Executive Officers for 2024 (the Company’s most recently completed fiscal year) to (ii) the Company’s performance:

  106. Pay vs. Performance Table

    | Most Important Performance Measures: | | Adjusted Return on Equity (Adjusted ROE) | | Adjusted Earnings Available for Distribution ROE (Adjusted EAD ROE) | | Book Value Total Shareholder Return (bvTSR) | | Total Shareholder Return (TSR) | | Relative Total Shareholder Return (rTSR) |

  107. Pay vs. Performance Table

    As discussed within the Compensation Discussion and Analysis section of this Proxy Statement, Redwood’s business model and internally-managed REIT structure inform the Compensation Committee’s selection of performance metrics used in Redwood’s performance-based executive compensation program. As described in the Compensation Discussion and Analysis section of this Proxy Statement, in addition to total stockholder return and relative total stockholder return, which is Redwood’s total stockholder return measured on a relative basis against the TSR of a comparator group of companies or the group of companies that comprise a stock index, the Compensation Committee believes that return-on-equity based measures, including Adjusted ROE, Adjusted EAD ROE, and book value total stockholder return, are highly relevant metrics for determining annual bonuses and measuring Redwood’s longer-term performance because, among other things, these financial performance measures should correlate with Redwood’s ability to increase book value and pay attractive levels of sustainable and growing dividends and, over the long-term, strong results under these performance measures should correlate with strong TSR. A described within the Compensation Discussion and Analysis section of this Proxy Statement, Adjusted ROE and Adjusted EAD ROE are each non-GAAP performance measures that are defined and described on pages 58-62 within this CD&A under the heading “2024 Performance-Based Annual Bonus Compensation.” Adjusted ROE and Adjusted EAD ROE should not be considered as alternatives to GAAP net income, GAAP ROE or other measurements of results of operations computed in accordance with GAAP or for federal income tax purposes. See Annex B to this Proxy Statement for additional discussion, disclosure and details regarding these non-GAAP financial performance metrics.

  108. ADDITIONAL INFORMATION ABOUT DIRECTORS AND EXECUTIVE OFFICERS

    ADDITIONAL INFORMATION ABOUT DIRECTORS AND EXECUTIVE OFFICERS