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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR
15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event
reported): December 11, 2025
REDWOOD TRUST, INC.
(Exact name of registrant as specified in
its charter)
|
Maryland
(State or other
jurisdiction of
incorporation)
|
001-13759
(Commission
File Number)
|
68-0329422
(I.R.S. Employer
Identification No.) |
One
Belvedere Place
Suite
300
Mill Valley, California 94941
(Address of principal executive offices and Zip Code)
(415) 389-7373
(Registrant’s telephone number, including area code)
Not Applicable
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions (see General Instruction A.2. below):
| ¨ |
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ |
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ |
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ |
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Indicate by check mark whether the registrant is an emerging
growth company as defined in Rule 405 of the Securities Act of 1933 or Rule 12b-2 of the Securities Exchange Act of 1934.
Emerging growth
company ¨
If an emerging growth company,
indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised
financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
Securities registered pursuant to Section
12(b) of the Act:
| Title of each class |
Trading symbol(s) |
Name
of each exchange on which registered |
| Common stock, par value $0.01 per share |
RWT |
New York Stock Exchange |
|
10% Series A Fixed-Rate Reset Cumulative Redeemable Preferred Stock, par value $0.01 per share |
RWT PRA |
New York Stock Exchange |
| 9.125% Senior Notes Due 2029 |
RWTN |
New York Stock Exchange |
| 9.00% Senior Notes Due 2029 |
RWTO |
New York Stock Exchange |
| 9.125% Senior Notes Due 2030 |
RWTP |
New York Stock Exchange |
| 9.500% Senior Notes Due 2030 |
RWTQ |
New York Stock Exchange |
Item 5.02. Compensatory Arrangements of Certain Officers.
(e) At a meeting held on December 11,
2025, the Compensation Committee of the Board of Directors of Redwood Trust, Inc. (the “Company”) considered and approved
the following compensation matters for the Company’s CEO and for the Company’s other named executive officers, as noted below.
2025 Year-End Long-Term Equity Compensation
Awards. On December 11, 2025, the Compensation Committee approved 2025 year-end long-term
equity-based incentive (“LTI”) awards for named executive officers of the Company to be granted on December 11, 2025.
Three different types of equity-based awards were granted: Deferred Stock Units (“DSUs”), cash-settled Restricted Stock Units
(“csRSUs”), and Performance Stock Units (“PSUs”) pursuant to the Company’s Second Amended and Restated 2014
Incentive Award Plan (the “2014 Incentive Plan”). The terms of each of these three types of awards are summarized below.
| |
· |
The DSUs and csRSUs that were approved for grant will vest over four years, as follows: for DSUs, 25% of each award will vest on January 31, 2027, and an additional 6.25% will vest on the first day of each subsequent quarter (beginning April 1, 2026), with full vesting of the final 6.25% on December 26, 2029; for csRSUs, 25% of each award will vest on December 26, 2026, and an additional 25% will vest on each subsequent December 26th (beginning December 26, 2027), with full vesting of the final 25% on December 26, 2029. The DSUs and csRSUs will vest in full upon a termination of service (i) either without “cause” or for “good reason”, in either case, on or within 24 months following a change in control or externalization event, or (ii) due to the officer’s death or disability. In addition, the DSUs and csRSUs are subject to partial or full accelerated vesting upon a termination of service due to the officer’s “retirement”. With respect to DSUs, shares of Company common stock underlying the DSUs will be distributed to the recipients not later than December 31, 2029. With respect to csRSUs, on each vesting date, cash in an amount equal to the value of the common stock underlying the csRSUs that vest on such vesting date will be distributed to the recipients promptly following each such vesting date. |
| |
· |
Each DSU and csRSU approved for grant will have a grant date fair value of the closing price of the Company’s common stock on the New York Stock Exchange (“NYSE”) on the grant date, as determined in accordance with FASB Accounting Standards Codification Topic 718 at the time the grant is made. The number of DSUs and csRSUs granted to each officer will be determined based on a dollar amount for each award divided by the closing price of the Company’s common stock on the NYSE on the grant date. The DSUs and csRSUs have attached dividend equivalent rights, resulting in the payment of dividend equivalents each time the Company declares a common stock dividend during the vesting period and until the underlying shares of common stock or cash are distributed. |
| |
· |
The definitive terms of the DSUs that were approved for grant will be set forth in a form of Deferred Stock Unit Award Agreement and the 2014 Incentive Plan, each of which are substantially in the form filed as exhibits to the Company’s Annual Report on Form 10-K. The foregoing description of the terms of the DSUs does not purport to be complete and is qualified in its entirety by the full text of the form of Deferred Stock Unit Award Agreement included as Exhibit 10.1 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. |
| |
· |
The terms of the csRSUs that were approved for grant are generally consistent with the terms of the DSUs that were approved for grant, except that on each vesting date, cash in an amount equal to the value of the common stock underlying the csRSUs that vest on such vesting date will be distributed to the recipients promptly following each such vesting date, rather than through the delivery of shares of common stock. The definitive terms of the csRSUs that were approved for grant will be set forth in a form of Cash-Settled Restricted Stock Unit Award Agreement and the 2014 Incentive Plan, each of which are substantially in the form filed as exhibits to the Company’s Annual Report on Form 10-K. The foregoing description of the terms of the csRSUs does not purport to be complete and is qualified in its entirety by the full text of the form of Cash-Settled Restricted Stock Unit Award Agreement included as Exhibit 10.7 to the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. |
| |
· |
The PSUs that were approved for grant are performance-based equity awards under which the number of underlying shares of Company common stock that vest and that the recipient becomes entitled to receive at the time of vesting will generally range from 0% to 250% of the target number of PSUs granted (for each executive, such target number, the “Target PSUs”), with the Target PSUs granted being adjusted to reflect the value of any dividends declared on Company common stock during the vesting period (as further described below). Vesting of these PSUs will generally occur after a three-year performance measurement/vesting period, i.e., as of January 1, 2029, based on a three-step process as described below. |
| |
· |
First, vesting would range from 0%-250% of half of the Target PSUs granted based on the level of non-GAAP Core Segments EAD ROE (“Core Segments EAD ROE”) attained over the three-year vesting period, with 100% of this half of the Target PSUs vesting if three-year Core Segments EAD ROE is 25%. |
| |
· |
Second,
vesting would range from 0%-250% of half of the Target PSUs granted based on Redwood’s relative total stockholder return (“rTSR”)
against a comparator group of companies measured over the three-year vesting period, with 100% of this half of the Target PSUs vesting
if three-year rTSR corresponds to 55th percentile rTSR. |
| |
· |
Third, if the vesting level after steps
one and two is greater than 100% of the Target PSUs, but absolute total shareholder return (“TSR”) is negative over the three-year
performance period, vesting would be capped at 100% of Target PSUs. |
In the event
of a termination of employment due to the officer’s death or disability, by the Company without cause, by the officer for good reason
or due to the officer’s retirement (each, a “qualifying termination”), in any event, during the performance period,
the PSUs will remain outstanding and eligible to vest based on the achievement of performance goals during the performance period. The
number of PSUs that ultimately vest (if any) will be pro-rated in connection with a retirement during 2026 or a termination of employment
by the Company without cause; the pro-ration will be applied based on the number of days the officer was employed during 2026 and the
performance period, respectively.
In addition, in the event
of a change in control or externalization event: (i) PSUs will be earned based on the achievement of performance goals through the
shortened performance period ending with the change in control or externalization event (with the Core
Segments EAD ROE goal being deemed achieved at target); (ii) the number of PSUs earned will remain outstanding and eligible
to vest as time-vesting PSUs on January 1, 2029, subject to the officer’s continued employment; and (iii) if the officer
experiences a qualifying termination prior to January 1, 2029, the then-outstanding time-vesting PSUs will vest.
Subject to vesting, shares
of Company common stock underlying these PSUs will be distributed to the recipients within 45 days following March 31, 2029. At the
time of vesting, the value of any dividends declared 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 Company common stock that a stockholder would
have acquired during the three-year vesting period had all dividends during that period been reinvested in Company common stock. Between
the vesting of these PSUs and the delivery of the underlying shares of Company common stock, the underlying vested award shares will have
attached dividend equivalent rights, resulting in the payment of dividend equivalents each time the Company declares a common stock dividend
during that period.
Each PSU that
was approved for grant had a preliminary estimated grant date fair value, as of November 20, 2025, of $5.955, which preliminary
estimate will be finalized and determined in accordance with FASB Accounting Standards Codification Topic 718 as of the time the grant
is made.
The definitive terms
of these PSUs are set forth in the Form of Performance Stock Unit Award Agreement (which is included
as Exhibit 10.1 hereto and incorporated by reference herein) and the 2014 Incentive Plan. The foregoing
description of the terms of the PSUs does not purport to be complete and is qualified in its entirety by the full text of the Form of
Performance Stock Unit Award Agreement included as Exhibit 10.1 hereto.
In accordance with the requirements of Item 5.02(e) of
Form 8-K, the 2025 year-end LTI awards that were approved and granted to the named executive
officers of the Company are set forth in the table below:
| | |
Deferred Stock Units
(“DSUs”) | | |
Cash Settled
RSUs
(“csRSUs”) | | |
Performance Stock Units
(“PSUs”) | |
| | |
Aggregate Grant
Date Fair Value | | |
Aggregate Grant
Date Fair Value | | |
Aggregate Grant
Date Fair Value | |
Christopher J. Abate,
Chief Executive Officer | |
$ | 652,500 | | |
$ | 815,625 | | |
$ | 1,794,375 | |
| | |
| | | |
| | | |
| | |
Dashiell I. Robinson,
President | |
$ | 540,000 | | |
$ | 1,080,000 | | |
$ | 1,080,000 | |
| | |
| | | |
| | | |
| | |
Brooke E. Carillo,
Chief Financial Officer | |
$ | 525,000 | | |
$ | 1,050,000 | | |
$ | 1,050,000 | |
| | |
| | | |
| | | |
| | |
Andrew P. Stone,
Executive Vice President & Chief Legal Officer | |
$ | 225,000 | | |
$ | 450,000 | | |
$ | 450,000 | |
| | |
| | | |
| | | |
| | |
Sasha G. Macomber,
Chief Human Resources Officer | |
$ | 225,000 | | |
$ | 450,000 | | |
$ | 450,000 | |
2026 Base Salaries. On
December 11, 2025, the Compensation Committee made determinations regarding the 2026
base salaries of named executive officers of the Company. In accordance with the requirements of Item 5.02(e) of Form 8-K,
the increase in base salary from 2025 to 2026 for each of the named executive officers of the Company is set forth in the table below.
| | |
2026 Base Salary
(% increase from 2025) | |
Christopher J. Abate,
Chief Executive Officer | |
| 2.6 | % |
| | |
| | |
Dashiell I. Robinson,
President | |
| 0 | % |
| | |
| | |
Brooke E. Carillo,
Chief Financial Officer | |
| 1.7 | % |
| | |
| | |
Andrew P. Stone,
Executive Vice President and Chief Legal Officer | |
| 0 | % |
| | |
| | |
Sasha G. Macomber,
Chief Human Resources Officer | |
| 0 | % |
2026
Target Annual Bonuses. On December 11, 2025,
the Compensation Committee made determinations regarding the 2026 target annual bonuses of named executive officers of the
Company. Performance goals associated with earning at, above, or below target annual bonus for 2026 will be based on one or
more financial performance goals, operational goals and individual goals pre-established by the Compensation Committee in the first
quarter of 2026. In accordance with the requirements of Item 5.02(e) of Form 8-K, the increase in target annual bonus
amount from 2025 to 2026 for each of the named executive officers of the Company is set forth in the table below.
| | |
2026 Target
Annual Bonus
(% increase in target amount
from 2025) | |
Christopher J. Abate,
Chief Executive Officer | |
| 5 | % |
| | |
| | |
Dashiell I. Robinson,
President | |
| 0 | % |
| | |
| | |
Brooke E. Carillo,
Chief Financial Officer | |
| 4.2 | % |
| | |
| | |
Andrew P. Stone,
Executive Vice President and Chief Legal Officer | |
| 0 | % |
| | |
| | |
Sasha G. Macomber,
Chief Human Resources Officer | |
| 0 | % |
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits
| Exhibit 10.1 | Form of
Performance Stock Unit Award Agreement under 2014 Incentive Plan |
| | Exhibit 104 | Cover Page Interactive Data File (embedded within the inline XBRL document) |
SIGNATURES
Pursuant to the requirements
of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto
duly authorized.
| Date: December 12, 2025 |
REDWOOD TRUST, INC. |
| |
|
|
| |
By: |
/s/
Andrew P. Stone |
| |
|
Name: |
Andrew P. Stone |
| |
|
Title: |
Executive Vice President, Chief Legal Officer, and
Secretary |
