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As filed with the Securities and Exchange Commission on January 23, 1997
Registration No.333-
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM S-8/S-3
REGISTRATION STATEMENT
Under
THE SECURITIES ACT OF 1933
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REDWOOD TRUST, INC.
MARYLAND (Exact Name of Registrant as Specified in its charter) 68-0329422
(State or other jurisdiction of 591 Redwood Highway, Suite 3100 (I.R.S. Employer I.D. Number)
incorporation or organization) Mill Valley, CA 94941
(415) 389-7373
(Address, including zip code, and telephone number, including area code, of
Principal Executive offices)
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AMENDED AND RESTATED
1994 EXECUTIVE AND NON-EMPLOYEE DIRECTOR STOCK OPTION PLAN
(Full title of the Plan)
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George E. Bull, III
Chairman of the Board and Chief Executive Officer
REDWOOD TRUST, INC.
591 Redwood Highway, Suite 3100
Mill Valley, CA 94941
(415) 389-7373
(Name, Address, including zip code, and telephone number, including area code,
of Agent for Service)
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Copies to:
Douglas B. Hansen Phillip R. Pollock, Esq.
President and Chief Financial Officer TOBIN & TOBIN
REDWOOD TRUST, INC. One Montgomery Street, 15th Floor
591 Redwood Highway, Suite 3100 San Francisco, CA 94104
Mill Valley, CA 94941 (415) 433-1400
(415) 389-7373
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APPROXIMATE DATE OF COMMENCEMENT OF PROPOSED SALE TO THE PUBLIC: AT ANY
TIME AND FROM TIME TO TIME AFTER THE EFFECTIVE DATE OF THIS REGISTRATION
STATEMENT IN LIGHT OF MARKET CONDITIONS AND OTHER FACTORS.
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If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: / /
If any of the securities being registered on this Form are to be offered on a
delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering: / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under
the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering: / /
If delivery of the prospectus is to be made pursuant to Rule 434, please check
the following box: / /
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CALCULATION OF REGISTRATION FEE
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Title of securities to be Amount to be Proposed maximum offering Proposed maximum aggregate Amount of
registered registered price per share(1) offering price(1) registration fee
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Common Stock, par value 1,649,486 $36.88 $60,833,043.68 $20,976.91
$.01 per share(2)
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(1) Calculated in accordance with Rule 457(c) and (h) based on the average
of the high and low prices, $37.25 and $36.50, respectively, reported
for the Common Stock on the Nasdaq National Market for December 31,
1996.
(2) In addition, pursuant to Rule 416(c) under the Securities Act of 1933,
as amended, this registration statement also covers an indeterminate
amount of interests to be offered or sold pursuant to the employee
benefit plan described herein.
THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE
OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT
SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION
STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(A) OF
THE SECURITIES ACT OF 1933 OR UNTIL THIS REGISTRATION STATEMENT SHALL BECOME
EFFECTIVE ON SUCH DATE AS THE COMMISSION ACTING PURSUANT TO SAID SECTION 8(A),
MAY DETERMINE.
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EXPLANATORY NOTE
This Registration Statement contains two parts. The first part contains
a prospectus pursuant to Form S-3 (in accordance with Section C of the General
Instructions to Form S-8) which covers reoffers and resales of control
securities and restricted securities of the Registrant which previously have
been issued or which shall be issued upon exercise of options granted pursuant
to the Redwood Trust, Inc. Amended and Restated 1994 Executive and Non-Employee
Director Stock Option Plan. The second part of this Registration Statement
contains Information Required in the Registration Statement pursuant to Part II
of Form S-8 and certain items from "Information Not Required in the Prospectus"
pursuant to Part II of Form S-3. Pursuant to the Note to Part I of the
instructions to Form S-8, the Plan Information specified by Part I is not being
filed with the Securities and Exchange Commission.
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PART I
INFORMATION REQUIRED IN REOFFER PROSPECTUS
SUBJECT TO COMPLETION DATED JANUARY 23, 1997
1,649,486 SHARES OF COMMON STOCK
RWT
REDWOOD TRUST, INC.
Redwood Trust, Inc. ("Redwood Trust" or the "Company") has adopted an
Amended and Restated 1994 Executive and Non-Employee Director Stock Option Plan
(the "Stock Option Plan" or the "Plan") which provides for the grant of
qualified incentive stock options ("ISOs") which meet the requirements of
section 422 of the Code, stock options not so qualified ("NQSQs"), dividend
equivalent rights ("DERs"), deferred stock, restricted stock, performance
shares, stock appreciation and limited stock awards ("Awards"). Options and
Awards under the Stock Option Plan are made exclusively in shares of the
Company's common stock, par value $0.01 per share (the "Common Stock"). On March
8, 1996, the Company's Board of Directors adopted, subject to approval of the
stockholders, amendments to the Stock Option Plan which would provide for an
increase in the maximum aggregate number of shares of the Company's Common Stock
available for grant under the Stock Option Plan and certain other changes. Such
amendments were approved at the Annual Meeting of Stockholders on June 14, 1996
and became effective on such date. On December 13, 1996, certain additional
non-material changes to the Plan were approved by the Board of Directors and
became effective on that date. On January 22, 1997, the Board of Directors
approved amended and restated resolutions authorizing the issuance of the Common
Stock under the Plan.
This Prospectus relates to 1,649,486 shares (the "Shares") of the Company's
Common Stock, which may be sold from time to time by the selling stockholders
named herein (the "Selling Stockholders"), which Shares which have been issued
or are issuable to the Selling Stockholders pursuant to options (the "Options")
granted pursuant to stock option agreements between the Company and the Selling
Stockholders. The Company has received or will receive various amounts ranging
from approximately $0.10 to $36.875 for each Share issued upon the exercise of
the Options. The Company will not receive any of the proceeds from the sale of
the Shares by the Selling Stockholders. All expenses of registration incurred in
connection with this offering are being borne by the Company; all selling and
other expenses incurred by the Selling Stockholders in connection with the sale
of the Shares will be borne by the Selling Stockholders. The Company is not
aware of any underwriting arrangements with respect to the sale of any of the
Shares by the Selling Stockholders.
The Shares may be offered by or for the account of the Selling Stockholders
or by their pledgees, donees, transferees or other successors in interest, from
time to time, on the Nasdaq National Market ("Nasdaq") or on any stock exchange
on which the Shares may be listed at the time of sale, in negotiated
transactions, or through a combination of such methods of sale, at fixed prices
which may be changed, at market prices prevailing at the time of sale, at prices
related to such prevailing market prices, or at negotiated prices. The
transactions may be effected by selling the Shares to or through broker-dealers
who may receive compensation in the form of discounts, concessions, or
commissions from the Selling Stockholders and/or the purchasers of the Shares
(which compensation as to a particular broker-dealer might be in excess of
customary commissions). Any broker-dealer acquiring Shares from a Selling
Stockholder may sell such Shares in its normal market making activities, through
other brokers on a principal or agency basis, in negotiated transactions, or
through a combination of such methods. See "Selling Stockholders" and "Plan of
Distribution."
(CONTINUED ON NEXT PAGE)
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
NOR HAS THE SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES
COMMISSION PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
FOR INFORMATION CONCERNING THE COMPANY'S CURRENT FINANCIAL CONDITION
AND OTHER IMPORTANT FACTORS, SEE "AVAILABLE INFORMATION" AND
"INCORPORATION OF CERTAIN INFORMATION BY REFERENCE."
The date of this Prospectus is January ___, 1997
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(CONTINUED FROM PREVIOUS PAGE)
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION OTHER THAN AS CONTAINED OR INCORPORATED BY REFERENCE IN THIS
PROSPECTUS, AND ANY INFORMATION OR REPRESENTATION NOT CONTAINED OR INCORPORATED
BY REFERENCE HEREIN SHOULD NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED BY THE
COMPANY. THIS PROSPECTUS DOES NOT CONSTITUTE AN OFFER OF ANY SECURITIES OTHER
THAN THOSE DESCRIBED ON THE COVER PAGE OR AN OFFER TO SELL OR A SOLICITATION OF
AN OFFER TO BUY THE SHARES IN ANY STATE OR OTHER JURISDICTION WHERE, OR TO ANY
PERSON TO WHOM, IT IS UNLAWFUL TO MAKE SUCH OFFER. NEITHER THE DELIVERY OF THIS
PROSPECTUS NOR ANY SALES MADE HEREUNDER, UNDER ANY CIRCUMSTANCES, SHALL CREATE
ANY IMPLICATION THAT THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY
BETWEEN THE DATE HEREOF AND THE DATE OF ANY SUCH SALE.
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AVAILABLE INFORMATION
The Company is subject to the information requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports and other information with the Securities and Exchange
Commission (the "Commission" or "SEC"). Reports, proxy statements and other
information filed by the Company may be inspected and copied at the public
reference facilities maintained by the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the Commission's regional offices located at
Seven World Trade Center, 13th Floor, New York, New York 10048, and at 500 West
Madison Street, Chicago, Illinois 60661. Copies may also be obtained from the
Public Reference section of the Commission at 450 Fifth Street, N.W.,
Washington, D.C. 20549 at prescribed rates. The Common Stock, Stock Purchase
Warrants and Class B 9.74% Cumulative Convertible Preferred Stock (the "Class B
Preferred Stock") of the Company are currently quoted on the Nasdaq National
Market. Reports, proxy statements and other information concerning the Company
may be inspected at the National Association of Securities Dealers, Inc., 1735 K
Street, N.W., Washington, D.C. 20006. In addition, holders of the Common Stock
and Class B Preferred Stock will receive annual reports containing audited
financial statements with a report thereon by the Company's independent
certified public accountants, and quarterly reports containing unaudited summary
financial information for each of the first three quarters of each fiscal year.
The Company files information electronically with the Commission, and the
Commission maintains a Web Site that contains reports, proxy and information
statements and other information regarding registrants (including the Company)
that file electronically with the Commission. The address of the Commission's
Web Site is <http://www.sec.gov>.
Copies of the Registration Statement on Form S-8/S-3, together with all
amendments, exhibits and documents incorporated therein by reference (the
"Registration Statement"), of which this Prospectus forms a part, is on file at
the offices of the Commission pursuant to the Securities Act of 1933, as amended
(the "Securities Act") with respect to the Shares offered by this Prospectus.
This Prospectus omits certain of the information contained in the Registration
Statement, certain parts of which are omitted in accordance with the rules and
regulations of the Commission, and reference is hereby made to the Registration
Statement for further information with respect to the Company and the Shares
offered hereby. Statements contained in this Prospectus as to the contents of
any exhibit, contract or other document referred to are not necessarily
complete, and in each instance each statement is qualified in all respects by
reference made to a copy of such exhibit, contract or other document filed as an
exhibit to the Registration Statement or otherwise filed with the SEC and
incorporated by reference herein or otherwise filed with the Commission. The
Company currently furnishes its stockholders with annual reports containing
financial statements audited by its independent auditors and with quarterly
reports containing unaudited summary financial information for each of the first
three quarters of each fiscal year.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
There are incorporated herein by reference the following documents
heretofore filed by the Company with the Commission:
(a) The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1995.;
(b) The Company's Quarterly Report on Form 10-Q for the fiscal quarters
ended March 31, 1996, June 30, 1996 and September 30, 1996;
(c) The Company's Current Report on Form 8-K filed on January 7, 1997
(Reg. No. 000-26436);
(d) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, as amended (Reg. No.
0-26436), filed July 17, 1996, under the Exchange Act; and
(e) The registration statement for the Company's Dividend Reinvestment and
Stock Purchase Plan on Form S-3, filed December 17, 1996 (Reg. No.
333-18061).
All documents filed by the Company pursuant to Sections 13(a), 13(c), 14 or
15(d) of the Exchange Act subsequent to the date of this Prospectus and prior to
the filing of a post-effective amendment indicating that such Shares have been
sold, or deregistering all of the Shares that, at the time of such
post-effective amendment, remain unsold, shall be deemed to be incorporated by
reference in this Prospectus and to be a part hereof from the date of filing of
such documents. Any statement contained herein or in any document incorporated
by reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained herein or in any other
subsequently filed document, which also is or is deemed to be incorporated by
reference herein, modifies or supersedes such statement. Any statement so
modified or superseded shall not be deemed, except as so modified or superseded,
to constitute a part of this Prospectus.
The Company hereby undertakes to provide without charge to each person,
including any beneficial owner, to whom a Prospectus is delivered, upon written
or oral request of that person, a copy of any document incorporated herein by
reference (other than exhibits to those documents unless the exhibits are
specifically incorporated herein by reference into the documents that this
Prospectus incorporates by reference). Requests should be directed to Vickie L.
Rath, Vice-President, Treasurer and Controller, Redwood Trust, Inc., 591
Redwood Highway, Suite 3100, Mill Valley, California 94941, telephone (415) 389-
7373.
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THE COMPANY
The Company is a real estate investment trust which specializes in
acquiring and managing real estate mortgage loans. Such loans are originated by
others to the Company's specifications or to specifications approved by the
Company. The Company has acquired mortgage loans secured by single-family real
estate properties throughout the United States, with a special emphasis on
properties located in the State of California, and may in the future acquire
mortgage loans secured by multifamily and commercial real estate properties. The
Company's mortgage loans may be acquired as whole loans or as mortgage
securities evidencing interests in pools of mortgage loans. The Company's
principal business objective is to generate net income for distribution to
stockholders. The Company has elected to be subject to tax as a real estate
investment trust ("REIT") under the Internal Revenue Code of 1986, as amended
(the "Code"), and will generally not be subject to tax on its Federal income to
the extent that it distributes its earnings to its stockholders and maintains
its qualification as a REIT. The Company was incorporated in the State of
Maryland on April 11, 1994, commenced operations on August 19, 1994 and is
self-advised and self-managed. The Company's principal executive office is
located at 591 Redwood Highway, Suite 3100, Mill Valley, California 94941.
Additional information regarding the Company, including the audited
financial statements of the Company and descriptions of the Company's currently
outstanding Common Stock, Stock Purchase Warrants and Class B Preferred Stock,
is contained in the documents incorporated by reference herein. See
"Incorporation of Certain Information by Reference," above.
USE OF PROCEEDS
The Company will not realize any proceeds from the sale of Shares which may
be sold under this Prospectus for the respective accounts of each of the Selling
Stockholders. The Company, however, will derive proceeds from exercise of the
Options. Such proceeds will be available to the Company for working capital and
general corporate purposes. No assurance can be given, however, as to when or if
any or all of the Options will be exercised.
SELLING STOCKHOLDERS
As of December 31, 1996, options for up to 1,649,486 shares of Common Stock
were authorized to be issued under the Stock Option Plan, options to acquire
421,625 shares were issued and outstanding under such Plan and options to
acquire 89,166 shares had previously been exercised, leaving 1,138,695 shares
available for the grant of additional options, Awards or DERs. The Plan provides
that, in connection with any reorganization, merger, consolidation,
recapitalization, stock split or similar transaction, the Compensation Committee
shall appropriately adjust the number of shares of Common Stock subject to
outstanding options, Awards and DERs and the total number of shares for which
options, Awards or DERs may be granted under the Plan.
The following table identifies, as of December 31, 1996, (a) the name of
each Selling Stockholder and the nature of any position, office or other
material relationship which each such Selling Stockholder has had with the
Company or any of its affiliates within the last three (3) years; (b) the total
number of shares beneficially owned by each Selling Stockholder; (c) the number
of shares of Common Stock offered for each such Selling Stockholder's account;
and (e) the number of shares of Common Stock and the percentage beneficially
owned by each such Selling Stockholder after completion of the offering,
assuming all Shares offered pursuant to this Prospectus are sold.
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Shares to be Beneficially
Shares of Common Owned upon Completion
Stock Beneficially Shares of Offering(1)(3)
Relationship Owned as of Offered -------------------------
Selling Stockholder to Company December 31, 1996(1) Hereby(2) Number Percent
------------------- ---------- -------------------- --------- ------ -------
George E. Bull III Chairman of the 229,386(4) 126,514 102,872 *
Board, Chief Executive
Officer and Director
(Principal Executive
Officer)
Douglas B. Hansen President, Chief 200,920(5) 126,513 74,407 *
Financial Officer and
Director (Principal
Financial Officer)
Frederick H. Borden Vice President of the 166,483(6) 107,587 58,896 *
Board, Secretary and
Director
Dan A. Emmett Director 17,288(7) 10,618 6,670 *
Thomas F. Farb Director 10,618(8) 10,618 0 *
Nello Gonfiantini Director 30,730(9) 10,618 20,112 *
Charles J. Toeniskoetter Director 12,338(10) 10,618 1,720 *
Vickie L. Rath Vice President, 50,609(11) 46,609 4,000 *
Treasurer and
Controller (Principal
Accounting Officer)
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* Less than one percent.
(1) Assuming full exercise of Warrants and full exercise of stock options
granted to December 31, 1996, whether or not vested, including DERs
accrued through such date.
(2) Indicates all shares of Common Stock previously acquired by the Selling
Stockholder under the Plan or issuable to the Selling Stockholder upon
exercise of outstanding options granted under the Plan. Excludes DERs
that may accrue on unexercised options in future periods.
(3) Assumes that all options are exercised and all shares offered hereby
are sold, that no additional shares will be acquired and that no shares
other than those offered hereby will be sold.
(4) Includes 97,662 shares of Common Stock currently outstanding held of
record by the Bull Trust, 15,310 shares of Common Stock issuable upon
the exercise of Warrants held of record by the Bull Trust, 2,500 shares
of Common Stock currently outstanding held of record by Mr. Bull's
children, 500 shares of Common Stock issuable upon the exercise of
Warrants held of record by Mr. Bull's children and 101,792 shares of
Common Stock issuable upon the exercise of stock options including
DERs.
(5) Includes 101,791 shares of Common Stock issuable upon the exercise of
stock options including DERs.
(6) Includes 130 shares of Common Stock currently outstanding held of
record by Mr. Borden's children, 130 shares of Common Stock issuable
upon the exercise of Warrants held of record by Mr. Borden's children
and 82,865 shares of Common Stock issuable upon the exercise of stock
options including DERs.
(7) Includes 9,368 shares of Common Stock issuable upon the exercise of
stock options including DERs.
(8) Includes 9,368 shares of Common Stock issuable upon the exercise of
stock options including DERs.
(9) Includes 9,368 shares of Common Stock issuable upon the exercise of
stock options including DERs.
(10) Includes 660 shares and 9,368 shares of Common Stock issuable upon the
exercise of Warrants and stock options including DERs, respectively.
Also includes 400 shares which Mr. Toeniskoetter has voting and
investment power in
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the TBI Construction Profit Sharing Trust.
(11) Includes 38,609 shares of Common Stock issuable upon the exercise of
stock options including DERs.
The number, if any, and terms of options, DERs or Awards which may be
granted in the remainder of 1997 and in future periods is not presently
determinable as the Compensation Committee has sole discretion to determine the
number, if any, and terms of such options, DERs or Awards.
CERTAIN FEDERAL INCOME TAX CONSIDERATIONS
The following discussion is a general summary of certain Federal income
tax considerations to the Company and to holders of the Securities. It is based
on existing Federal income tax law, which is subject to change, possibly
retroactively. PROSPECTIVE INVESTORS ARE ADVISED TO CONSULT THEIR TAX ADVISORS
AS TO THE SPECIFIC TAX CONSEQUENCES TO THEM OF THE SECURITIES, INCLUDING THE
APPLICATION AND EFFECT OF FEDERAL, STATE, LOCAL AND FOREIGN INCOME AND OTHER TAX
LAWS. FOR A FULLER DISCUSSION OF FEDERAL INCOME TAX CONSIDERATIONS, SEE THE
COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31,
1995.
GENERAL
The Company has elected to become subject to tax as a REIT, for Federal
income tax purposes, commencing with the taxable year ending December 31, 1994.
The Board of Directors of the Company currently expects that the Company will
continue to operate in a manner that will permit the Company to maintain its
qualifications as a REIT for the taxable year ending December 31, 1996, and in
each taxable year thereafter. This treatment will permit the Company to deduct
dividend distributions to its stockholders for Federal income tax purposes, thus
effectively eliminating the "double taxation" that generally results when a
corporation earns income and distributes that income to its stockholders.
In the opinion of Giancarlo & Gnazzo, A Professional Corporation,
special tax counsel to the Company ("Special Tax Counsel"), the Company has been
organized and operated in a manner which qualifies it as a REIT under the Code
since the commencing of its operations on August 19, 1994 through September 30,
1996, the date of the Company's last unaudited financials received by Special
Tax Counsel, and the Company's current and contemplated methods of operation, as
represented by the Company, will enable it to continue to so qualify. This
opinion is based on various assumptions relating to the organization and
operation of the Company to date and in the future and is conditioned upon
certain representations made by the Company as to certain factual matters. The
continued qualification and taxation of the Company as a REIT will depend upon
the Company's ability to meet, on a continuing basis, distribution levels and
diversity of stock ownership, and various other qualification tests imposed by
the Code. This opinion is based on the law existing and in effect on the date
hereof which is subject to change, possibly retroactively.
There can be no assurance that the Company will continue to qualify as
a REIT in any particular taxable year, given the highly complex nature of the
rules governing REITs, the ongoing importance of factual determinations and the
possibility of future changes in the circumstances of the Company. If the
Company were not to qualify as a REIT in any particular year, it would be
subject to Federal income tax as a regular domestic corporation, and its
stockholders would be subject to potentially substantial income tax liability in
respect of each taxable year that it fails to qualify as a REIT. In addition,
the amount of earnings and cash available for distribution to its stockholders
could be significantly reduced or eliminated.
TAXATION OF THE COMPANY
In any year in which the Company qualifies as a REIT, the Company will
generally not be subject to Federal income tax on that portion of its REIT
taxable income or capital gain which is distributed to its stockholders. The
Company will, however, be subject to Federal income tax at normal corporate
income tax rates upon any undistributed taxable income or capital gain and may
also be subject to tax in certain other circumstances.
If the Company fails to qualify as a REIT in any taxable year and
certain relief provisions of the Code do not apply, the Company would be subject
to Federal income tax (including any applicable alternative minimum tax) on its
taxable income at the regular corporate income tax rates. Distributions to
stockholders in any year in which the Company fails to qualify as a REIT would
not be deductible by the Company, nor would they generally be required to be
made under the Code. Further,
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unless entitled to relief under certain other provisions of the Code, the
Company would also be disqualified from re-electing REIT status for the four
taxable years following the year during which it became disqualified.
TAXATION OF SECURITIES HOLDERS
COMMON STOCK GENERALLY
Distributions (including constructive distributions) made to holders of
Common Stock, other than tax-exempt entities, will generally be subject to tax
as ordinary income to the extent of the Company's current and accumulated
earnings and profits as determined for Federal income tax purposes. If the
amount distributed exceeds a stockholder's allocable share of such earnings and
profits, the excess will be treated as a return of capital to the extent of the
stockholder's adjusted basis in its shares, which will not be subject to tax,
and thereafter as a taxable gain from the sale or exchange of a capital asset.
Distributions designated by the Company as capital gain dividends will
generally be subject to tax as long-term capital gain to stockholders, to the
extent that the distribution does not exceed the Company's actual net capital
gain for the taxable year. Distributions by the Company, whether characterized
as ordinary income or as capital gain, are not eligible for the corporate
dividends received deduction. In the event that the Company realizes a loss for
the taxable year, stockholders will not be permitted to deduct any share of that
loss. Further, if the Company (or a portion of its assets) were to be treated as
a taxable mortgage pool, any "excess inclusion income" that is allocated to a
stockholder would not be allowed to be offset by a net operating loss of such
stockholder. Future Treasury Department regulations may require that the
stockholders take into account, for purposes of computing their individual
alternative minimum tax liability, certain tax preference items of the Company.
Dividends declared during the last quarter of a taxable year and
actually paid during January of the following taxable year are generally treated
as if received by the stockholder on the record date of the dividend payment and
not on the date actually received. In addition, the Company may elect to treat
certain other dividends distributed after the close of the taxable year as
having been paid during such taxable year, but stockholders still will be
treated as having received such dividend in the taxable year in which the
distribution is made.
Upon a sale or other disposition of Common Stock, a stockholder will
generally recognize a capital gain or loss in an amount equal to the difference
between the amount realized and the stockholder's adjusted basis in such stock,
which gain or loss will be long-term if the stock has been held for more than
one year. Any loss on the sale or exchange of shares held by a stockholder for
six months or less will generally be treated as a long-term capital loss to the
extent of any long-term capital gain dividends received by such stockholder. If
Common Stock is sold after a record date but before a payment date for declared
dividends on such stock, a stockholder will nonetheless be required to include
such dividend in income in accordance with the rules above for distributions,
whether or not such dividend is required to be paid over to the purchaser.
The Company also maintains a Dividend Reinvestment and Stock Purchase
Plan (the "DRP"). DRP Participants will generally be treated as having received
a dividend distribution equal to the fair market value on the Investment Date
(as defined in the DRP) of the Plan Shares that are purchased with the
Participant's reinvested dividends and/or optional cash payments, plus the
brokerage commissions, if any, allocable to the purchase of such shares, and
participants will have a tax basis in the shares equal to such value. DRP
Participants may not, however, receive any cash with which to pay the resulting
tax liability. Shares received pursuant to the DRP will have a holding period
beginning on the day after their purchase by the Plan Administrator. For more
detailed tax disclosure information regarding this topic, see the DRP which is
available upon request to the Company.
The Company is required under Treasury Department regulations to demand
annual written statements from the record holders of designated percentages of
its Capital Stock disclosing the actual and constructive ownership of such stock
and to maintain permanent records showing the information it has received as to
the actual and constructive ownership of such stock and a list of those persons
failing or refusing to comply with such demand.
TAXATION OF TAX-EXEMPT ENTITIES
The Company does not expect to incur excess inclusion income (within
the meaning of Section 860E(c) of the Code) and therefore does not prohibit
tax-exempt entities or "disqualified organizations" from investing in its
Securities. In general, a tax-exempt entity that is a holder of the Company's
Securities will not be subject to tax on distribution.
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The Company does not intend to issue debt obligations with different
maturities secured by a single pool of Mortgage Assets and does not expect to
create or acquire taxable mortgage pools that can generate excess inclusion
income. In addition, the Company does not intend to create or acquire REMIC
residual interests that can generate excess inclusion income.
FOREIGN INVESTORS
In general, foreign investors will be subject to special withholding
tax requirements on income and capital gains distributions attributable to their
ownership of the Company's Securities subject to possible reduction pursuant to
an applicable income tax treaty.
ERISA INVESTORS
Because the Shares will qualify as a "publicly offered security,"
employee benefit plans and Individual Retirement Accounts may purchase Shares
and treat such Shares, and not the Company's assets, as plan assets. Fiduciaries
of ERISA plans should consider (i) whether an investment in the Shares offered
hereby satisfies ERISA diversification requirements, (ii) whether the investment
is in accordance with the ERISA plans' governing instruments and (iii) whether
the investment is prudent.
PLAN OF DISTRIBUTION
The sales of Shares by the Selling Stockholders, or by their pledgees,
donees, transferees or other successors in interest, may be effected, from time
to time, by offerings to or through underwriters or directly to other purchasers
or through agents in one or more transactions on the Nasdaq National Market or
other applicable securities exchange on which the Shares may be listed at the
time of sale, in one or more private transactions, or in a combination of such
methods of sale, at prices and on terms then prevailing, at prices related to
such prices, or at negotiated prices. The transactions may be effected by
selling Shares to or through such broker-dealers, and such broker-dealers may
receive compensation in the form of discounts, concessions, or commissions from
the Selling Stockholders and/or the purchasers of Shares (which compensation as
to a particular broker-dealer might be in excess of customary commissions).
The Selling Stockholders, their pledgees, donees, transferees or other
successors in interest, and any broker-dealers that act in connection with the
sale of the Shares hereunder might be deemed to be "Underwriters" within the
meaning of Section 2(11) of the Securities Act; any commissions received by them
and any profit on the resale of Shares as principal might be deemed to be
underwriting compensation under the Securities Act.
Any broker-dealer acquiring shares from a Selling Stockholder may sell
the Shares either directly, in its normal market-making activities, through or
to other brokers on a principal or agency basis, or to its customers. Any such
sales may be at prices then prevailing on the Nasdaq National Market or other
applicable securities exchange, at prices related to such prevailing market
prices, at negotiated prices or a combination of both methods.
The Company has advised the Selling Stockholders that anti-manipulative
Rules 10b-2, 10b-6 and 10b-7 under the Exchange Act may apply to their sales in
the market, has furnished the Selling Stockholders with a copy of these Rules
and has informed the Selling Stockholders of the possible need for them to
deliver copies of this Prospectus. The Selling Stockholders may indemnify any
broker-dealer that participates in the transactions involving the sale of the
Shares against certain liabilities, including liabilities arising under the
Securities Act. Any commissions paid or any discounts or concessions allowed to
any such broker-dealers, and, if any such broker-dealers purchase Shares as
principal, any profits received on the resale of such shares, may be deemed to
be underwriting discounts and commissions under the Securities Act.
Upon the Company's being notified by any Selling Stockholder that any
material arrangement has been entered into with a broker-dealer for the sale of
Shares through a cross or block trade, a supplemental prospectus will be filed
under Rule 424(c) under the Securities Act, setting forth the name of the
participating broker-dealer(s), the number of Shares involved, the price at
which such Shares were sold by the Selling Stockholder, the commissions paid or
discounts or concessions allowed by the Selling Stockholder to such
broker-dealer(s), and where applicable, that such broker-dealer(s) did not
conduct any investigation to verify the information set out in this Prospectus.
8
12
Any Shares which qualify for sale pursuant to Rule 144 under the
Securities Act may be sold under that Rule rather than pursuant to this
Prospectus.
There can be no assurances that the Selling Stockholders will sell any
or all of the Shares offered by them hereunder.
All expenses of the registration of the Shares will be paid by the
Company.
LEGAL MATTERS
The validity of the Common Stock offered hereby and certain legal
matters will be passed on for the Company by Tobin & Tobin, a professional
corporation, San Francisco, California. Certain tax matters will be passed on by
Giancarlo & Gnazzo, A Professional Corporation, San Francisco, California. Tobin
& Tobin and Giancarlo & Gnazzo, A Professional Corporation, will rely as to all
matters of Maryland law upon Piper & Marbury L.L.P., Baltimore, Maryland.
EXPERTS
The Balance Sheets as of December 31, 1994 and 1995 and the Statements
of Operations, Stockholders' Equity and Cash Flows for the period from August
19, 1994 (Commencement of Operations) to December 31, 1994 and for the year
ended December 31, 1995 incorporated by reference in this Prospectus have been
included therein in reliance on the report of Coopers & Lybrand, L.L.P.,
independent accountants, given on the authority of that firm as experts in
accounting and auditing.
9
13
No person has been authorized to give any information or to make any
representations in connection with this offering other than those contained in
this Prospectus and, if given or made, such other information and
representations must not be relied upon as having been authorized by the Company
or any other person. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of the Company since the date hereof or that the
information contained herein is correct as of any time subsequent to its date.
This Prospectus does not constitute an offer to sell or a solicitation of an
offer to buy any securities other than the registered securities to which it
relates. This Prospectus does not constitute an offer to sell or a solicitation
of an offer to buy such securities, nor shall any sales of the Securities be
made pursuant to this Prospectus, in any circumstances in which such offer or
solicitation or sale is unlawful.
TABLE OF CONTENTS
Page
----
Available Information......................................................... 3
Incorporation of Certain Information by Reference............................. 3
The Company................................................................... 4
Use of Proceeds............................................................... 4
Selling Stockholders.......................................................... 4
Certain Federal Income Tax Considerations..................................... 6
ERISA Investors............................................................... 8
Plan of Distribution.......................................................... 8
Legal Matters................................................................. 9
Experts....................................................................... 9
1,649,486 Shares
Common Stock
RWT
REDWOOD TRUST, INC.
-------------
PROSPECTUS
-------------
January __, 1997
14
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 3 (FORM S-8). INCORPORATION OF DOCUMENTS BY REFERENCE
There are incorporated herein by reference the following documents
heretofore filed by the Company with the Commission:
(a) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1995.;
(b) The Company's Quarterly Report on Form 10-Q for the fiscal
quarters ended March 31, 1996, June 30, 1996 and September
30, 1996;
(c) The Company's Current Report on Form 8-K filed on January 7,
1997 (Reg. No. 000-26436);
(d) The description of the Company's Common Stock contained in the
Company's Registration Statement on Form 8-A, as amended (Reg.
No. 0-26436), filed July 17, 1996, under the Exchange Act; and
(e) The registration statement for the Company's Dividend
Reinvestment and Stock Purchase Plan on Form S-3, filed
December 17, 1996 (Reg. No. 333-18061).
All documents filed by the Company pursuant to Sections 13(a), 13(c),
14 or 15(d) of the Exchange Act subsequent to the date of the Prospectus
included in this registration statement and prior to the filing of a post
effective amendment indicating that the shares covered by the registration
statement have been sold, or deregistering all of the shares that, at the time
of such post-effective amendment, remain unsold, shall be deemed to be
incorporated by reference into the Prospectus and to be a part thereof from the
date of filing of such documents.
ITEM 4 (FORM S-8). DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5 (FORM S-8). INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6 (FORM S-8) AND ITEM 15 (FORM S-3). INDEMNIFICATION OF DIRECTORS AND
OFFICERS.
Section 2-418 of the Corporations and Associations
Article of the Annotated Code of Maryland provides that a
Maryland corporation may indemnify any director of the
corporation and any person who, while a director of the
corporation, is or was serving at the request of the
corporation as a director, officer, partner, trustee,
employee, or agent of another foreign or domestic corporation,
partnership, joint venture, trust, or other enterprise or
employee benefit plan, is made a party to any proceeding by
reason of service in that capacity unless it is established
that the act or omission of the director was material to the
matter giving rise to the proceeding and was committed in bad
faith or was the result of active and deliberate dishonesty;
or the director actually received an improper personal benefit
in money, property or services; or, in the case of any
criminal proceeding, the director had reasonable cause to
believe that the act or omission was unlawful. Indemnification
may be against judgments, penalties, fines, settlements, and
reasonable expenses actually incurred by the director in
connection with the proceeding, but if the proceeding was one
by or in the right of the corporation, indemnification may not
be made in respect of any proceeding in which the director
shall have been adjudged to be liable to the corporation. Such
indemnification may not be made unless authorized for a
specific proceeding after a determination has been made, in
the manner prescribed by the law, that indemnification is
permissible in the circumstances because the director has met
the applicable standard of conduct. On the other hand, the
director must be indemnified for expenses if he has been
successful in the defense of the proceeding or as otherwise
ordered by a court. The law also prescribes the circumstances
under which the corporation may advance expenses to, or obtain
insurance or similar protection for, directors.
The law also provides for comparable indemnification
for corporate officers and agents.
The Registrant's Charter provides that its directors
and officers shall, and its agents in the discretion of the
Board of Directors may, be indemnified to the fullest extent
required or permitted from time to time by the laws of
Maryland.
II-1
15
The Maryland General Corporation Law (the "Maryland
GCL") permits the charter of a Maryland corporation to include
a provision limiting the liability of its directors and
officers to the corporation and its stockholders for money
damages except to the extent that (i) it is proved that the
person actually received an improper benefit or profit in
money, property or services for the amount of the benefit or
profit in money, property or services actually received, or
(ii) a judgment or other final adjudication is entered in a
proceeding based on a finding that the person's action, or
failure to act, was the result of active and deliberate
dishonesty and was material to the cause of action adjudicated
in the proceeding. The Company's Charter contains a provision
providing for elimination of the liability of its directors
and officers to the Company or its stockholders for money
damages to the maximum extent permitted by Maryland law from
time to time.
ITEM 7 (FORM S-8). EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8 (FORM S-8) AND ITEM 16 (FORM S-3). EXHIBITS
3.3.1* Amended and Restated Bylaws of the Registrant, amended
December 13, 1996.
5.1 Opinion of Tobin & Tobin, a professional corporation, as to
legality (including consent of such firm)
5.2 Opinion of Piper & Marbury L.L.P. as to legality (including
consent of such firm)
8.1 Opinion of Giancarlo & Gnazzo, A Professional Corporation, as
to certain tax matters (including consent of such firm)
10.14.2 Amended and Restated 1994 Executive and Non-Employee Director
Stock Option Plan
23.1 Consent of Tobin & Tobin (included in Exhibit 5.1)
23.2 Consent of Piper & Marbury L.L.P. (included in Exhibit 5.2)
23.3 Consent of Giancarlo & Gnazzo, A Professional Corporation
(included in Exhibit 8.1)
23.4 Consent of Coopers & Lybrand L.L.P., independent accountants.
24.1 Power of Attorney (included in signature page)
- -------------
* Incorporated by reference to the correspondingly numbered exhibit to the
current report on Form 8-K filed by the Registrant with the Securities and
Exchange Commission on January 7, 1997 (Reg. No. 000-26436).
ITEM 9 (FORM S-8) AND ITEM 17 (FORM S-3). UNDERTAKINGS
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being made,
a post-effective amendment to this registration statement;
(i) To include any prospectus required by Section 10(a)(3) of
the Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in the registration
statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration statement or
any material change to such information in the registration statement.
Provided, however, that paragraphs a(1)(i) and (a)(1)(ii) do not apply
if the information required to be included in a post-effective amendment by
those paragraphs is contained in the periodic reports filed by the Registrant
pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the Registration Statement.
II-2
16
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination of
the offering.
(b) The undersigned Registrant hereby undertakes that: (1) for purposes of
determining any liability under the Securities Act of 1933, the information
omitted from the form of Prospectus filed as part of this Registration Statement
in reliance upon Rule 430A and contained in a form of Prospectus filed by the
Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
of 1933 shall be deemed to be part of this Registration Statement as of the time
it was declared effective; and (2) for the purpose of determining any liability
under the Securities Act of 1933, each post-effective amendment that contains a
form of Prospectus shall be deemed to be a new Registration Statement relating
to the securities offered therein and the offering of such securities at that
time shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
Registrant, pursuant to the foregoing provisions, or otherwise, the Registrant
has been advised that in the opinion of the Securities and Exchange Commission,
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the Registrant of expenses incurred
or paid by a director, officer or controlling person of the Registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities begin
registered, the Registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.
II-3
17
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City and County of San Francisco, State of California, on
January 23, 1997.
REDWOOD TRUST, INC.
By: /s/ George E. Bull, III
--------------------------------------------------
George E. Bull, III
(Chairman of the Board and Chief Executive Officer)
POWER OF ATTORNEY
WE, THE UNDERSIGNED DIRECTORS AND OFFICERS OF REDWOOD TRUST, INC., DO
HEREBY CONSTITUTE AND APPOINT GEORGE E. BULL III, DOUGLAS B. HANSEN, FREDERICK
H. BORDEN AND VICKIE L. RATH OUR TRUE AND LAWFUL ATTORNEYS AND AGENTS, TO DO ANY
AND ALL ACTS AND THINGS IN OUR NAME AND BEHALF IN OUR CAPACITIES AS DIRECTORS,
OFFICERS AND TO EXECUTE ANY AND ALL INSTRUMENTS FOR US AND IN OUR NAMES IN THE
CAPACITIES INDICATED BELOW, WHICH SAID ATTORNEYS AND AGENTS MAY DEEM NECESSARY
OR ADVISABLE TO ENABLE SAID CORPORATION TO COMPLY WITH THE SECURITIES ACT OF
1933, AS AMENDED, AND ANY RULES, REGULATIONS AND REQUIREMENTS OF THE SECURITIES
AND EXCHANGE COMMISSION, IN CONNECTION WITH THIS REGISTRATION STATEMENT,
INCLUDING SPECIFICALLY, BUT WITHOUT LIMITATION, POWER AND AUTHORITY TO SIGN FOR
US OR ANY OF US IN OUR NAMES AND IN THE CAPACITIES INDICATED BELOW, ANY AND ALL
AMENDMENTS (INCLUDING POST-EFFECTIVE AMENDMENTS) HEREOF; AND WE DO HEREBY RATIFY
AND CONFIRM ALL THAT THE SAID ATTORNEYS AND AGENTS SHALL DO OR CAUSE TO BE DONE
BY VIRTUE HEREOF.
PURSUANT TO THE REQUIREMENTS OF THE SECURITIES ACT OF 1933, THIS FORM
S-8 REGISTRATION STATEMENT HAS BEEN SIGNED BY THE FOLLOWING PERSONS IN THE
CAPACITIES AND ON THE DATES INDICATED:
Signature Position Date
- --------- -------- ----
/s/ George E. Bull, III Chairman of the Board, Chief January 23, 1997
- --------------------------------
George E. Bull, III Executive Officer and Director
(Principal Executive Officer)
/s/ Douglas B. Hansen President, Chief Financial Officer January 23, 1997
- --------------------------------
Douglas B. Hansen and Director
(Principal Financial Officer)
/s/ Frederick H. Borden Vice Chairman of the Board, January 23, 1997
- --------------------------------
Frederick H. Borden Secretary and Director
/s/ Vickie L. Rath Vice President, Treasurer and January 23, 1997
- --------------------------------
Vickie L. Rath Controller (Principal Accounting
Officer)
/s/ Dan A. Emmett Director January 23, 1997
- --------------------------------
Dan A. Emmett
/s/ Thomas F. Farb Director January 23, 1997
- --------------------------------
Thomas F. Farb
/s/ Nello Gonfiantini Director January 23, 1997
- --------------------------------
Nello Gonfiantini
/s/ Charles J. Toeniskoetter Director January 23, 1997
- --------------------------------
Charles J. Toeniskoetter
II-4
18
EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION OF DOCUMENT PAGE NO.
- ----------- ----------------------- --------
3.3.1* Amended and Restated Bylaws of the Registrant,
amended December 13, 1996 . . . . . . . . . . . . .
5.1 Opinion of Tobin & Tobin, a professional
corporation, as to legality (including consent of
such firm) . . . . . . . . . . . . . . . . . . . .
5.2 Opinion of Piper & Marbury L.L.P. as to legality
(including consent of such firm) . . . . . . . . .
8.1 Opinion of Giancarlo & Gnazzo, A Professional
Corporation, as to certain tax matters (including
consent of such firm) . . . . . . . . . . . . . . .
10.14.2 Amended and Restated 1994 Executive and Non-
Employee Director Stock Option Plan . . . . . . . .
23.1 Consent of Tobin & Tobin (included in Exhibit 5.1)
23.2 Consent of Piper & Marbury L.L.P. (included in
Exhibit 5.2) . . . . . . . . . . . . . . . . . . .
23.3 Consent of Giancarlo & Gnazzo, A Professional
Corporation (included in Exhibit 8.1) . . . . . . .
23.4 Consent of Coopers & Lybrand L.L.P.,
independent accountants . . . . . . . . . . . . . .
24.1 Power of Attorney (included in signature page). . .
- ---------
* Incorporated by reference to the correspondingly numbered exhibit to
the current report on Form 8-K filed by the Registrant with the Securities
and Exchange Commission on January 7, 1997 (Reg. No. 000-26436).
II-5