At December 31, 2025 and 2024, 4,808,078 and 7,027,251 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 $34 million at December 31, 2025, as shown in the following table.

Table 22.1 – Activities of Equity Compensation Costs by Award Type


	Year Ended December 31, 2025
(In Thousands)	Restricted Stock Units		Deferred Stock Units		Performance Stock Units		Employee Stock Purchase Plan		Total
Unrecognized compensation cost at beginning of year	$	6,984	$	17,630	$	15,840	$	—	$	40,454
Equity grants	4,913		12,247		4,912		185		22,257
Performance-based valuation adjustment	—		—		(10,828)		—		(10,828)
Equity grant forfeitures	(450)		(547)		—		—		(997)
Equity compensation expense	(4,265)		(10,739)		(1,325)		(185)		(16,514)
Unrecognized Compensation Cost at End of Year	$	7,182	$	18,591	$	8,599	$	—	$	34,372

Table 22.2 – Restricted Stock Units Activities


	Years Ended December 31,
	2025			2024			2023
	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	1,224,074	$	7.32	593,570	$	8.79	806,119	$	9.22
Granted	756,507	6.49		1,027,640	6.86		275,005	7.88
Vested	(481,899)	7.56		(297,320)	8.56		(354,813)	9.21
Forfeited	(64,852)	6.96		(99,816)	7.51		(132,741)	8.40
Outstanding at End of Year	1,433,830	$	6.83	1,224,074	$	7.32	593,570	$	8.79

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 milestone.

The expenses recorded for RSUs were $4 million, $2 million, and $3 million for the years ended December 31, 2025, 2024 and 2023, respectively. As of December 31, 2025, 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 2029.

Table 22.3 – Deferred Stock Units Activities


	Years Ended December 31,
	2025			2024			2023
	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	5,509,941	$	9.07	4,821,172	$	10.13	4,831,338	$	11.31
Granted	2,076,462	6.22		1,698,285	6.56		1,499,621	7.77
Distributions	(1,309,689)	11.13		(893,801)	10.07		(1,459,666)	11.71
Forfeitures	(81,234)	6.73		(115,715)	8.36		(50,121)	7.54
Balance at End of Year	6,195,480	$	7.71	5,509,941	$	9.07	4,821,172	$	10.13

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. DSUs generally vest over the course of a four-year vesting period, and are distributed after the end of the final vesting period or if sooner, to the extent vested, after the DSU grant recipient's employment terminates. At December 31, 2025 and 2024, the number of outstanding DSUs that were unvested was 3,403,676 and 3,011,071, respectively, and the weighted average grant-date fair value of these unvested DSUs was $6.76 and $7.71 at December 31, 2025 and 2024, respectively. Unvested DSUs at December 31, 2025 will vest through 2029.

Expenses related to DSUs were $11 million, $11 million, and $11 million for the years ended December 31, 2025, 2024, and 2023, respectively. At December 31, 2025, there was $19 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, 2025, 2024, and 2023, the Company granted PSUs to executive officers and certain employees that had been approved by the Compensation Committee as part of the annual compensation process. PSU grants are denominated as a number of "Target PSUs" and 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 half of the Target PSUs granted based on the level of non-GAAP Core Segments EAD ROE (“Core Segments EAD ROE" is defined in the form of PSU award agreements attached hereto as Exhibit 10.1) attained over the three-year vesting period, with 100% of this half of the Target PSUs vesting if the three-year cumulative Core Segments EAD ROE is 25%. Any PSUs vesting for this portion of the PSU award will be settled in common shares.

•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 the three-year rTSR corresponds to 55th percentile rTSR. Any PSUs vesting for this portion of the PSU award will be settled in cash. See Note 15 for further discussion of these cash-settled liability awards.

•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.

•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 the three-year cumulative bvTSR is 25%. Any PSUs vesting for this portion of the PSU award will be settled in common shares.

•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 the three-year rTSR corresponds to 55th percentile rTSR. Any PSUs vesting for this portion of the PSU award will be settled in common shares.

•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 22.4 – Performance Stock Unit Activities


	Years Ended December 31,
	2025			2024			2023
	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	3,656,838	$	9.49	3,072,039	$	10.32	2,354,002	$	11.75
Granted	707,231	6.95		1,058,644	7.50		993,868	8.81
Vested (1)	(518,173)	15.68		(473,845)	10.42		(275,831)	17.13
Forfeitures	—	—		—	—		—	—
Balance at End of Year	3,845,896	$	8.19	3,656,838	$	9.49	3,072,039	$	10.32

(1) Vested performance stock units reflects Target PSUs whose vesting period concluded during the period presented, regardless of the extent to which performance-based vesting criteria were met.

Expenses related to PSUs were $1 million, $6 million, and $4 million for the years ended December 31, 2025, 2024, and 2023, respectively. As of December 31, 2025, there was $9 million of unrecognized compensation cost related to unvested PSUs. During 2025, for PSUs granted in 2024, 2023 and 2022, we adjusted the cumulative expected amortization expense down by $11 million to reflect our revised vesting estimates.

The end of the vesting period for 1,086,153 Target PSU awards that were granted in 2022 was January 1, 2026, and based upon the performance-based vesting criteria of these awards, approximately 275,000 shares of our common stock underlying these PSUs qualified for vesting, subject to approval by our Board of Directors during the first quarter of 2026. For 518,173 Target PSU awards that were granted in December 2021, the performance vesting period ended on January 1, 2025. Based upon the performance-based vesting criteria of these awards, 183,057 shares of our common stock underlying these PSU vested and were distributed during the second quarter of 2025.

Table 22.5 – EDCP Payable and Activities


	Years Ended December 31,
(In Thousands)	2025		2024		2023
Balance at beginning of year	$	3,242	$	3,198	$	3,307
New deferrals	1,017		951		1,069
Accrued interest	182		168		155
Withdrawals	(1,025)		(1,075)		(1,333)
Balance at End of Year	$	3,416	$	3,242	$	3,198

In 2025, our Board of Directors approved an amendment to the EDCP to increase by 200,000 shares the shares available to allow non-employee directors to defer certain cash payments and dividends into DSUs. At December 31, 2025, there were 165,903 shares available for grant under this plan.