Redwood Trust, Inc. (NYSE: RWT; “Redwood” or the “Company”)
today announced the pricing of an underwritten public offering of
$60,000,000 aggregate principal amount of its 9.125% senior notes
due 2029 (the “Notes”). The offering is expected to close on
January 22, 2024, subject to the satisfaction of certain closing
conditions.
Redwood intends to apply to list the Notes on the New York Stock
Exchange under the symbol “RWTN” and, if the application is
approved, trading of the Notes on the New York Stock Exchange is
expected to begin within 30 days after the Notes are first issued.
The Notes have received an investment grade rating of BBB from
Egan-Jones Ratings Company, an independent, unaffiliated rating
agency.
Redwood intends to use the net proceeds from the offering for
general corporate purposes, which may include (i) the repurchase or
repayment of a portion of Redwood’s 5.625% convertible senior notes
due 2024, the 5.75% exchangeable senior notes due 2025 issued by
one of its subsidiaries or Redwood’s 7.75% convertible senior notes
due 2027, and/or (ii) funding of Redwood’s business and investment
activity, which may include funding Redwood’s residential and
business purpose lending mortgage banking businesses, acquiring
mortgage-backed securities for Redwood’s investment portfolio,
funding other long-term portfolio investments, and funding
strategic acquisitions and investments.
The Notes will be senior unsecured obligations of Redwood. The
Notes will bear interest at a rate equal to 9.125% per year,
payable quarterly in arrears on March 1, June 1, September 1 and
December 1 of each year, beginning on June 1, 2024. The Notes will
mature on March 1, 2029. The Notes will be issued in minimum
denominations of $25 and integral multiples of $25 in excess
thereof or in units.
Redwood will have the right to redeem the Notes, in whole or in
part, at its option at any time on or after March 1, 2026 at a
redemption price equal to 100% of the principal amount of the Notes
to be redeemed, plus accrued and unpaid interest to, but excluding,
the redemption date. Upon the occurrence of a change of control,
Redwood will be required to make an offer to repurchase all
outstanding Notes at a price equal to 101% of the principal amount
of the Notes, plus accrued and unpaid interest to, but excluding,
the repurchase date.
Wells Fargo Securities, LLC, Goldman Sachs & Co. LLC, Morgan
Stanley & Co. LLC, RBC Capital Markets, LLC and Keefe, Bruyette
& Woods, A Stifel Company, are acting as joint book-running
managers for the proposed offering. BTIG is acting as co-manager
for the proposed offering.
The public offering will be made pursuant to an automatic shelf
registration statement on Form S-3 that was filed by Redwood with
the Securities and Exchange Commission (“SEC”) and became effective
on March 4, 2022. A preliminary prospectus supplement and
accompanying prospectus relating to and describing the terms of the
offering have been filed with the SEC and are available on the
SEC’s website at www.sec.gov. Copies of the preliminary prospectus
supplement and accompanying prospectus may be obtained by
contacting:
Wells Fargo Securities, LLC 608 2nd Avenue South, Suite 1000
Minneapolis, MN 55402 Attn: WFS Customer Service Or by telephone:
(800) 645-3751 Or by email: wfscustomerservice@wellsfargo.com
Goldman Sachs & Co. LLC Attention: Prospectus Department 200
West Street New York, NY 10282 Or by telephone: 866-471-2526 Or by
email: prospectus-ny@ny.email.gs.com
Morgan Stanley & Co. LLC 180 Varick Street New York, NY
10014 Attention: Prospectus Department Or by telephone: (866)
718-1649 Or by email: prospectus@morganstanley.com
RBC Capital Markets, LLC Attention: Transaction Management
Brookfield Place 200 Vesey Street, 8th Floor New York, NY
10281-8098 Or by telephone: 866-375-6829 Or by email:
rbcnyfixedincomeprospectus@rbccm.com
Keefe, Bruyette & Woods, Inc. Attention: Capital Markets 787
Seventh Avenue 4th Floor New York, NY 10019 Or by telephone:
800-966-1559
This announcement shall not constitute an offer to sell or a
solicitation of an offer to buy these securities, nor shall there
be any sale of these securities in any state or jurisdiction in
which such offer, solicitation or sale would be unlawful prior to
the registration or qualification under the securities laws of any
such state or jurisdiction.
About Redwood Trust
Redwood Trust, Inc. (NYSE: RWT) is a specialty finance company
focused on several distinct areas of housing credit with a mission
to help make quality housing, whether rented or owned, accessible
to all American households. Our operating platforms occupy a unique
position in the housing finance value chain, providing liquidity to
growing segments of the U.S. housing market not well served by
government programs. We deliver customized housing credit
investments to a diverse mix of investors, through our
best-in-class securitization platforms; whole-loan distribution
activities; and our publicly traded shares. Our aggregation,
origination and investment activities have evolved to incorporate a
diverse mix of residential, business purpose and multifamily
assets. Our goal is to provide attractive returns to shareholders
through a stable and growing stream of earnings and dividends,
capital appreciation, and a commitment to technological innovation
that facilitates risk-minded scale. We operate our business in
three segments: Residential Mortgage Banking, Business Purpose
Mortgage Banking and Investment Portfolio. Additionally, through
RWT Horizons™, our venture investing initiative, we invest in
early-stage companies strategically aligned with our business
across the lending, real estate, and financial technology sectors
to drive innovations across our residential and business-purpose
lending platforms. Since going public in 1994, we have managed our
business through several cycles, built a track record of
innovation, and established a best-in-class reputation for service
and a common-sense approach to credit investing. Redwood Trust is
internally managed and structured as a real estate investment trust
for tax purposes.
CAUTIONARY STATEMENT: This press release contains
forward-looking statements within the meaning of the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995,
such as statements related to the offering, including the terms
thereof, the anticipated closing date, the intention to apply to
list the securities on the New York Stock Exchange and the expected
use of the net proceeds. Forward-looking statements involve
numerous risks and uncertainties. Redwood’s actual results may
differ materially from those projected, and Redwood cautions
investors not to place undue reliance on the forward-looking
statements contained in this release. Forward-looking statements
are not historical in nature and can be identified by words such as
“anticipate,” “estimate,” “will,” “should,” “expect,” “believe,”
“intend,” “seek,” “plan,” and similar expressions or their negative
forms, or by references to strategy, plans, or intentions. No
assurance can be given that the offering will be completed on the
terms described, or at all, or that the net proceeds of the
offering will be used as indicated. Completion of the offering on
the terms described, the application to list the securities on the
New York Stock Exchange and the application of the net proceeds,
are subject to numerous conditions, risks and uncertainties, many
of which are beyond the control of Redwood, including, among other
things, those described in Redwood’s preliminary prospectus
supplement dated January 17, 2024, the accompanying prospectus
dated March 4, 2022, and the documents incorporated in the
prospectus supplement and the prospectus by reference. Redwood
undertakes no obligation to update or revise any forward-looking
statements, whether as a result of new information, future events,
or otherwise.
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version on businesswire.com: https://www.businesswire.com/news/home/20240117038148/en/
Investor Relations Kaitlyn Mauritz SVP, Head of Investor
Relations Phone: 866-269-4976 Email:
investorrelations@redwoodtrust.com
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