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): March 17, 2010
REDWOOD
TRUST, INC.
(Exact
name of registrant as specified in its charter)
Maryland
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001-13759
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68-0329422
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(State
or other jurisdiction
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(Commission
File Number)
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(I.R.S.
Employer
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of
incorporation)
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Identification
No.)
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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):
o
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
o
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
o
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
o
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 5.02.
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Departure
of Certain Officers; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
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Items
5.02 (b), (c), & (e):
On
March 17, 2010, Redwood Trust, Inc. (the “Company”) announced that George E.
Bull, III will retire as Chief Executive Officer effective on May 18,
2010. Mr. Bull will remain a Director and Chairman of the Board of
Directors of the Company.
In
connection with Mr. Bull’s retirement, the Board of Directors has announced that
Martin S. Hughes will be promoted to Chief Executive Officer on May 18, 2010,
while continuing in his capacity as President. In addition, on May
18, 2010, Brett D. Nicholas will be promoted to sole Chief Operating Officer and
Executive Vice President, while continuing in his capacity as Chief Investment
Officer.
The
Company previously announced the appointment of Diane L. Merdian to serve as
Chief Financial Officer of the Company commencing on a date to be
determined. Ms. Merdian is now expected to commence employment as
Chief Financial Officer of the Company in April 2010, at which time Mr. Hughes,
who currently acts as Chief Financial Officer, will cease to act as Chief
Financial Officer.
Further
information relating to Mr. Hughes, Mr. Nicholas, and Ms. Merdian that is
responsive to the requirements of Item 5.02(c) of Form 8-K is incorporated by
reference from the Company’s Proxy Statement for its 2009 Annual Meeting of
Stockholders, a copy of which was filed with the SEC on April 3,
2009.
On
March 17, 2010, the Company entered into a Transition Agreement with Mr. Bull
relating to his retirement from serving as Chief Executive
Officer. Under the terms of that agreement, Mr. Bull will retire from
his position as Chief Executive Officer of the Company effective on May 18,
2010, and will cease employment with the Company on June 1,
2010.
The terms
of Mr. Bull’s Transition Agreement also provide for:
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·
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Payment
of a 2010 annual bonus, pro-rated based on the number of full calendar
months of employment completed during 2010, with the actual amount of the
2010 annual bonus to be determined by the Compensation Committee at the
end of the 2010 compensation cycle based on a process consistent with that
applied to non-retiring members of senior management, and with payment of
such bonus to be made at the same time annual bonuses for 2010 are
otherwise payable to non-retiring members of senior
management.
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·
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Vesting
of all outstanding Deferred Stock Awards as of June 1, 2010, except that
with respect to the Deferred Stock Award that was granted on December 9,
2009 (the “2009 Award”), the 2009 Award will be amended to provide that as
of June 1, 2010 it will be fully vested with respect to 71,445 shares and
the remainder of the shares subject to the 2009 Award will be
forfeited.
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·
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The
Deferred Stock Award granted to him on February 25, 2010 to continue, in
accordance with its terms, to be subject to a mandatory holding period
through May 1, 2012.
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·
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Amending
his outstanding Option agreements to provide that Options he holds
will continue to be exercisable while he continues to serve on the
Board of Directors and, in certain circumstances, for a period of up to
twelve months following such service, provided their stated term has not
expired.
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As
noted above, Mr. Bull will remain as a Director and Chairman of the Board
of Directors of the Company, and in that capacity will be compensated for that
service beginning June 2, 2010 in accordance with the Company’s compensation
policies applicable to non-employee directors. In addition, on March
17, 2010, the Board of Directors approved an amendment to those policies to
provide for the payment of an additional annual retainer of $110,000 per annum
for the role of Chairman of the Board of Directors (in addition to the $50,000
annual retainer paid to all non-employee directors), when that position is held
by a non-employee director. Beginning on June 2, 2010, as a
non-employee Chairman of the Board of Directors, Mr. Bull will be entitled to
such additional compensation.
On
March 17, 2010, the Company and Martin S. Hughes entered into an amendment to
Mr. Hughes’ employment agreement. The amendment provides for the
above-referenced change to Mr. Hughes’ title, an increase in Mr. Hughes’ base
salary, and an increase in Mr. Hughes’ target bonus. A copy of the
amendment is attached as Exhibit 10.1 to this Current Report on Form
8-K. In addition, on March 17, 2010, the Compensation Committee of
the Company’s Board of Directors approved a long-term equity grant to be made to
Mr. Hughes on May 18, 2010 in the form of deferred stock units with a grant date
fair value of $525,000, which award will be subject to a pro-rata vesting
schedule over a four year period beginning on the grant date.
On
March 17, 2010, the Company and Brett D. Nicholas entered into an amendment to
Mr. Nicholas’ employment agreement. The amendment provides for the
above-referenced change to Mr. Nicholas’ title. A copy of the
amendment is attached as Exhibit 10.2 to this Current Report on Form
8-K.
Item 7.01.
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Regulation
FD Disclosure.
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On
March 17, 2010, the Company issued a press release announcing the management
changes described above in Item 5.02. A copy of the press release is
attached as Exhibit 99.1 to this Current Report on Form 8-K.
The
information contained in this Item 7.01 and the attached Exhibit 99.1 is
furnished to and not filed with the Securities and Exchange Commission, and
shall not be incorporated by reference into any registration statement or other
document filed under the Securities Act of 1933, as amended, or the Securities
Exchange Act of 1934, as amended, except as shall be expressly set forth by
specific reference in such filing.
Item
9.01. Financial Statements and Exhibits.
Exhibit No
.
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Description
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10.1
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First
Amendment to Amended and Restated Employment Agreement, by and between
Redwood Trust, Inc. and Martin S. Hughes, dated as of March 17,
2010.
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10.2
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First
Amendment to Amended and Restated Employment Agreement, by and between
Redwood Trust, Inc. and Brett D. Nicholas, dated as of March 17,
2010.
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99.1
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Press
Release dated as of March 17,
2010
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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:
March 18, 2010
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REDWOOD
TRUST, INC.
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By:
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/s/ Andrew P. Stone
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Name:
Andrew P. Stone
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Title:
General Counsel and
Secretary
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EXHIBIT
INDEX
Exhibit No.
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Description
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10.1
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First
Amendment to Amended and Restated Employment Agreement, by and between
Redwood Trust, Inc. and Martin S. Hughes, dated as of March 17,
2010.
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10.2
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First
Amendment to Amended and Restated Employment Agreement, by and between
Redwood Trust, Inc. and Brett D. Nicholas, dated as of March 17,
2010.
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99.1
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Press
Release dated as of March 17,
2010
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Exhibit
10.1
FIRST
AMENDMENT TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT
AGREEMENT
(this “Agreement”), is entered into as of the 17
th
day of
March 2010 by and between
MARTIN S.
HUGHES
(the “Executive”) and
REDWOOD TRUST,
INC.,
a Maryland Corporation (the “Company”).
WHEREAS
, the Executive and the
Company have entered into an Amended and Restated Employment Agreement dated as
of March 31, 2009 (as amended, the “Employment Agreement”); and
WHEREAS
, the Executive and the
Company desire to enter into this Agreement for purposes of amending the
Employment Agreement as set forth herein;
NOW, THEREFORE
, for good and
valuable consideration, the receipt and adequacy which is hereby acknowledged,
the Executive and the Company hereby agree that the Employment Agreement is
hereby amended as follows effective upon May 18, 2010:
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(1)
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Section
1 of the Employment Agreement shall be amended and restated to read in its
entirety as follows:
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“
Employment as President and Chief
Executive Officer Of The Company
. The Company does hereby
employ the Executive as President and Chief Executive Officer of the
Company. The Executive does hereby accept and agree to such
employment. The Executive’s duties shall be such executive and
managerial duties as the Board of Directors of the Company shall from time to
time prescribe and as provided in the Bylaws of the Company. The
Executive shall devote such time, energy and skill to the performance of his
duties for the Company and for the benefit of the Company as may be necessary or
required for the effective conduct and operation of the Company’s
business. Furthermore, the Executive shall act only in good faith and
exercise due diligence and care in the performance of his duties to the Company
under this Agreement.”
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(2)
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Section
3(a) of the Employment Agreement shall be amended to replace the base
salary amount of “$500,000” specified therein with
“$700,000”.
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(3)
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Section
3(b) of the Employment Agreement shall be amended to replace the target
annual bonus percentage of “150%” specified therein with
“165%”.
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(4)
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Section
10 of the Employment Agreement shall be amended by replacing “Attn: Chief
Executive Officer” with “Attn: Chief Operating
Officer”.
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IN WITNESS WHEREOF
, the
Company has caused this Agreement to be executed by its duly authorized officer,
and the Executive has executed this Agreement, as of the date first above
written.
REDWOOD
TRUST, INC.
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By:
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/s/ George E. Bull, III
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Name:
George E. Bull, III
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Title:
Chairman & Chief Executive Officer
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MARTIN
S. HUGHES
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/s/ Martin S. Hughes
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Exhibit
10.2
FIRST
AMENDMENT TO AMENDED AND RESTATED EMPLOYMENT AGREEMENT
THIS FIRST AMENDMENT TO EMPLOYMENT
AGREEMENT
(this “Agreement”), is entered into as of the 17
th
day of
March 2010 by and between
BRETT D.
NICHOLAS
(the “Executive”) and
REDWOOD TRUST,
INC.,
a Maryland Corporation (the “Company”).
WHEREAS
, the Executive and the
Company have entered into an Amended and Restated Employment Agreement dated as
of March 31, 2009 (as amended, the “Employment Agreement”); and
WHEREAS
, the Executive and the
Company desire to enter into this Agreement for purposes of amending the
Employment Agreement as set forth herein;
NOW, THEREFORE
, for good and
valuable consideration, the receipt and adequacy which is hereby acknowledged,
the Executive and the Company hereby agree that the Employment Agreement is
hereby amended as follows effective upon May 18, 2010:
Section 1
of the Employment Agreement shall be amended to replace each occurrence of the
phrase “Chief Investment Officer and Co-Chief Operating Officer” therein with
“Chief Operating Officer, Chief Investment Officer, and Executive Vice
President”.
IN WITNESS WHEREOF
, the
Company has caused this Agreement to be executed by its duly authorized officer,
and the Executive has executed this Agreement, as of the date first above
written.
REDWOOD
TRUST, INC.
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By:
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/s/
George E.
Bull, III
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Name:
George E. Bull, III
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Title: Chairman
& Chief Executive Officer
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BRETT
D. NICHOLAS
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/s/ Brett D. Nicholas
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Exhibit
99.1
[LOGO]
FOR IMMEDIATE RELEASE
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CONTACTS:
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Mike
McMahon
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Redwood
Trust, Inc.
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(415)
384-3805
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Wednesday,
March 17, 2010
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Martin
S. Hughes
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(415)
389-7373
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Redwood
Trust, Inc.'s George Bull Plans Retirement as Chief Executive
Officer
Current President,
Martin Hughes, to be Promoted to CEO
MILL
VALLEY, Calif., March 17, 2010 — Redwood Trust, Inc. (NYSE: RWT) today announced
that George E. Bull, III will retire as Chief Executive Officer effective
on May 18, 2010. He will remain a Director and Chairman of the Board of
Directors of the company.
In
connection with Mr. Bull’s retirement, the Board of Directors has announced that
Martin S. Hughes will be promoted to Chief Executive Officer and President on
May 18, 2010. In addition, Brett D. Nicholas will be promoted
to sole Chief Operating Officer and Executive Vice President, while continuing
in his capacity as Chief Investment Officer.
George
Bull remarked, “Doug Hansen and I founded Redwood Trust in 1994, and I am proud
of our accomplishments and performance for long-term shareholders over the past
16 years. The Board has worked with me and carefully overseen the
process for selecting and transitioning the executive management of the company,
and I am confident that Marty Hughes and Brett Nicholas are well prepared and
will continue to be strong leaders and disciplined stewards of shareholder
capital.” Mr. Bull continued, “In my continuing capacity as Chairman
of the Board, I will remain engaged in providing strategic guidance and
maintaining the culture and principles that have been the foundation of our
success. As Redwood’s largest individual shareholder, I see
significant opportunities for the company in the future and believe that the
outlook for long-term shareholders continues to be positive.”
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. Forward-looking statements involve numerous risks and
uncertainties. Our actual results may differ from our beliefs, expectations,
estimates, and projections and, consequently, you should not rely on these
forward-looking statements as predictions of future events. 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. These forward-looking statements are subject
to risks and uncertainties, including, among other things, those described in
Redwood Trust’s Annual Report on Form 10-K for the year ended December 31, 2009
under the caption “Risk Factors.” We undertake no obligation to
update or revise any forward-looking statements, whether as a result of new
information, future events, or otherwise.