At December 31, 2024 and 2023, 7,027,251 and 10,211,459 shares of common stock, respectively, were available for grant under our Incentive Plan. The unamortized compensation cost of awards issued under the Incentive Plan, which are settled by delivery of shares of common stock, and purchases under the Employee Stock Purchase Plan, totaled $40 million at December 31, 2024, as shown in the following table.

Table 21.1 – Activities of Equity Compensation Costs by Award Type


	Year Ended December 31, 2024
(In Thousands)	Restricted Stock Units		Deferred Stock Units		Performance Stock Units		Employee Stock Purchase Plan		Total
Unrecognized compensation cost at beginning of year	$	3,166	$	18,920	$	15,519	$	—	$	37,605
Equity grants	7,047		10,559		7,942		207		25,755
Performance-based valuation adjustment	—		—		(1,626)		—		(1,626)
Equity grant forfeitures	(781)		(1,147)		—		—		(1,928)
Equity compensation expense	(2,448)		(10,702)		(5,995)		(207)		(19,352)
Unrecognized Compensation Cost at End of Year	$	6,984	$	17,630	$	15,840	$	—	$	40,454

As of December 31, 2024, there were no restricted stock awards outstanding or any remaining unrecognized compensation costs related to these awards. The expenses recorded for RSAs were zero, zero, and $0.1 million for the years ended December 31, 2024, 2023 and 2022, respectively.

Table 21.2 – Restricted Stock Units Activities


	Years Ended December 31,
	2024			2023			2022
	Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value		Shares	Weighted Average Grant Date Fair Value
Outstanding at beginning of year	593,570	$	8.79	806,119	$	9.22	431,072	$	11.55
Granted	1,027,640	6.86		275,005	7.88		558,388	8.38
Vested	(297,320)	8.56		(354,813)	9.21		(134,426)	12.56
Forfeited	(99,816)	7.51		(132,741)	8.40		(48,915)	11.04
Outstanding at End of Year	1,224,074	$	7.32	593,570	$	8.79	806,119	$	9.22

We generally grant RSUs annually, as part of our compensation process. In addition, RSUs are granted from time to time in connection with hiring and promotions. RSUs generally vest over the course of a four-year vesting period, and are distributed annually, at the end of each vesting period.

The expenses recorded for RSUs were $2 million, $3 million, and $3 million for the years ended December 31, 2024, 2023 and 2022, respectively. As of December 31, 2024, there was $7 million of unrecognized compensation cost related to unvested RSUs. This cost will be recognized over a weighted average period of less than 2 years. Restrictions on shares underlying RSUs outstanding lapse through 2028.

Table 21.3 – Deferred Stock Units Activities


	Years Ended December 31,
	2024			2023			2022
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Outstanding at beginning of year	4,821,172	$	10.13	4,831,338	$	11.31	4,022,088	$	12.93
Granted	1,698,285	6.56		1,499,621	7.77		1,759,344	8.83
Distributions	(893,801)	10.07		(1,459,666)	11.71		(551,401)	11.35
Forfeitures	(115,715)	8.36		(50,121)	7.54		(398,693)	12.07
Balance at End of Year	5,509,941	$	9.07	4,821,172	$	10.13	4,831,338	$	11.31

We generally grant DSUs annually, as part of our compensation process. In addition, DSUs are granted from time to time in connection with hiring and promotions and in lieu of the payment in cash of a portion of annual bonuses earned. DSUs generally vest over the course of a four-year vesting period, and are distributed after the end of the final vesting period or after an employee is terminated. At December 31, 2024 and 2023, the number of outstanding DSUs that were unvested was 3,011,071 and 2,536,692, respectively, and the weighted average grant-date fair value of these unvested DSUs was $7.71 and $9.05 at December 31, 2024 and 2023, respectively. Unvested DSUs at December 31, 2024 will vest through 2028.

Expenses related to DSUs were $11 million, $11 million, and $13 million for the years ended December 31, 2024, 2023, and 2022, respectively. At December 31, 2024, there was $18 million of unrecognized compensation cost related to unvested DSUs. This cost will be recognized over a weighted average period of less than 2 years.

During the years ended December 31, 2024, 2023, and 2022, the Company granted PSUs to certain executive officers that had been approved by the Compensation Committee as part of the annual compensation process. PSUs generally have performance-based vesting over the course of a three-year vesting/performance period and, subject to meeting certain performance criteria, will vest and be distributed after the end of the vesting period.

The grant date fair value of the PSUs was determined through a Monte-Carlo simulation using the following assumptions: (i) the common stock closing price at the grant date for Redwood and each member of the comparator group, (ii) the average closing price of the common stock price for the 60 trading days at the beginning of each calendar year for Redwood and each member of the comparator group, (iii) the range of performance-based vesting based on absolute total shareholder return (“TSR”) over three years from the grant date, (iv) an implied volatility assumption based on historical volatility, (v) a risk-free rate for the period interpolated from the U.S. Treasury yield curve on grant date and (vi) a dividend yield equivalent to reinvesting the dividends over the three-year performance period.

•First, vesting would range from 0% - 250% of two-thirds of the Target PSUs granted based on the level of book value total shareholder return ("bvTSR") attained over the three-year vesting period, with 100% of this two-thirds of the Target PSUs vesting if three-year bvTSR is 25%.

•Second, vesting would range from 0% - 250% of one-third of the Target PSUs granted based on Redwood’s relative total shareholder return (“rTSR”) against a comparator group of companies measured over the three-year vesting period, with 100% of this one-third of the Target PSUs vesting if three-year rTSR corresponds to 55th percentile rTSR.

•Third, if the aggregate vesting level after steps one and two is greater than 100% of the Target PSUs, but the Company's absolute total shareholder return ("TSR") is negative over the three-year performance period, vesting would be capped at 100% of Target PSUs.

Table 21.4 – Performance Stock Unit Activities


	Years Ended December 31,
	2024			2023			2022
	Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value		Units	Weighted Average Grant Date Fair Value
Outstanding at beginning of year	3,072,039	$	10.32	2,354,002	$	11.75	1,473,883	$	14.48
Granted	1,058,644	7.50		993,868	8.81		1,086,153	9.09
Vested	(473,845)	10.42		(275,831)	17.13		(206,034)	17.23
Forfeitures	—	—		—	—		—	—
Balance at End of Year	3,656,838	$	9.49	3,072,039	$	10.32	2,354,002	$	11.75

Expenses related to PSUs were $6 million, $4 million, and $4 million for the years ended December 31, 2024, 2023, and 2022, respectively. As of December 31, 2024, there was $16 million of unrecognized compensation cost related to unvested PSUs. During 2024, for PSUs granted in 2022 and 2021, we adjusted the cumulative expected amortization expense down by $2 million to reflect our revised vesting estimates.

The end of the vesting period for 518,173 target PSU awards that were granted in 2021 was January 1, 2025, and based upon the performance-based vesting criteria of these awards, approximately 180,000 shares of our common stock underlying these PSUs

qualified for vesting, subject to approval by our Board of Directors during the first quarter of 2025. For 473,845 target PSU awards that were granted in December 2020, the performance vesting period ended on January 1, 2024. Based upon the performance-based vesting criteria of these awards, 564,975 shares of our common stock underlying these PSU vested and were distributed during the second quarter of 2024.

Table 21.5 – EDCP Payable and Activities


	Years Ended December 31,
(In Thousands)	2024		2023		2022
Balance at beginning of year	$	3,198	$	3,307	$	2,730
New deferrals	951		1,069		1,083
Accrued interest	168		155		108
Withdrawals	(1,075)		(1,333)		(614)
Balance at End of Year	$	3,242	$	3,198	$	3,307

In 2023, our Board of Directors approved an amendment to the EDCP to increase by 100,000 shares the shares available to allow non-employee directors to defer certain cash payments and dividends into DSUs. At December 31, 2024, there were 82,395 shares available for grant under this plan.