[LETTERHEAD
OF VENABLE LLP]
November
23, 2007
Redwood
Trust, Inc.
One
Belvedere Place
Mill
Valley, California 94941
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Re: |
Registration
Statement on Form S-3
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Ladies
and Gentlemen:
We
have
served as Maryland counsel to Redwood Trust, Inc., a Maryland corporation
(the
"Company"), in connection with certain matters of Maryland law relating to
the
registration by the Company of: (a) debt securities of the Company (the
"Debt Securities"); (b) shares of common stock (the "Common Shares") of the
Company, $0.01 par value per share ("Common Stock"); (c) shares of
preferred stock (the "Preferred Shares") of the Company, $0.01 par value
per
share ("Preferred Stock"); (d) warrants to purchase shares of Common Stock
or
Preferred Stock (the "Warrants"); (e) rights (the "Rights") to purchase other
Securities (as defined herein) and (f) units comprised of two or more of
the
foregoing Securities (the "Units" and, together with the Debt Securities,
Common
Shares, Preferred Shares, Warrants and Rights, the "Securities"), covered
by the
above-referenced Registration Statement and any amendments thereto
(collectively, the "Registration Statement"), filed by the Company with the
United States Securities and Exchange Commission (the "Commission") under
the
Securities Act of 1933, as amended (the "Securities Act").
In
connection with our representation of the Company, and as a basis for the
opinion hereinafter set forth, we have examined originals, or copies certified
or otherwise identified to our satisfaction, of the following documents
(hereinafter collectively referred to as the "Documents"):
1.
The
Registration Statement and the related form of prospectus included therein
(the
"Prospectus"), substantially in the form to be transmitted to the Commission
under the Securities Act;
2.
The
charter of the Company (the "Charter"), certified as of a recent date by
the
State Department of Assessments and Taxation of Maryland (the
"SDAT");
3.
The
Amended and Restated Bylaws of the Company, as amended (the "Bylaws"), certified
as of the date hereof by an officer of the Company;
4.
Resolutions
adopted by the Board of Directors of the Company (the "Board"), relating
to,
among other items, the approval of the filing of the Registration Statement,
certified as of the date hereof by an officer of the Company;
Redwood
Trust, Inc.
November
23, 2007
Page
2
5.
A
certificate of the SDAT as to the good standing of the Company, dated as
of a
recent date;
6.
A
certificate executed by an officer of the Company, dated as of the date hereof;
and
7. Such
other documents and matters as we have deemed necessary or appropriate to
express the opinion set forth below, subject to the assumptions, limitations
and
qualifications stated herein.
In
expressing the opinion set forth below, we have assumed the
following:
1.
Each
individual executing any of the Documents, whether on behalf of such individual
or any other person, is legally competent to do so.
2.
Each
individual executing any of the Documents on behalf of a party (other than
the
Company) is duly authorized to do so.
3.
Each
of
the parties (other than the Company) executing any of the Documents has duly
and
validly executed and delivered each of the Documents to which such party
is a
signatory, and the obligations of each party set forth in the Documents are
legal, valid, binding and enforceable in accordance with all stated
terms.
4.
All
Documents submitted to us as originals are authentic. The form and content
of
all Documents submitted to us as unexecuted drafts do not differ in any respect
relevant to this opinion from the form and content of such Documents as executed
and delivered. All Documents submitted to us as certified or photostatic
copies
conform to the original documents. All signatures on all such Documents are
genuine. All public records reviewed or relied upon by us or on our behalf
are
true and complete. All representations, warranties, statements and information
contained in the Documents are true and complete. There has been no oral
or
written modification of or amendment to any of the Documents, and there has
been
no waiver of any provision of any of the Documents, by action or omission
of the
parties or otherwise.
Redwood
Trust, Inc.
November
23, 2007
Page
3
5.
The
issuance, and certain terms, of the Securities to be issued by the Company
from
time to time will be authorized and approved by the Board, or a duly authorized
committee thereof, in accordance with the Maryland General Corporation Law,
the
Charter and the Bylaws and, with respect to Preferred Shares, Articles
Supplementary setting forth the number of shares and the terms of any class
or
series of Preferred Shares (the "Articles Supplementary") to be issued by
the
Company will be filed with and accepted for record by the SDAT prior to their
issuance (such approval and, if applicable, acceptance for record, referred
to
herein as the "Corporate Proceedings").
6.
Upon
the
issuance of any Common Shares, including any Common Shares which may be issued
upon conversion or exercise of any Securities that are convertible into or
exercisable for Common Stock, the total number of shares of Common Stock
issued
and outstanding will not exceed the total number of shares of Common Stock
that
the Company is then authorized to issue under the Charter.
7.
Upon
the
issuance of any Preferred Shares, including any Preferred Shares which may
be
issued upon conversion or exercise of any Securities that are convertible
into
or exercisable for Preferred Stock, the total number of shares of Preferred
Stock issued and outstanding, and the total number of issued and outstanding
shares of the applicable class or series of Preferred Stock designated pursuant
to the Charter, will not exceed, respectively, the total number of shares,
and
the number of shares of such class or series, of Preferred Stock that the
Company is then authorized to issue under the Charter.
8.
None
of
the Securities will be issued in violation of the restrictions on ownership
and
transfer set forth in Article XI of the Charter or any comparable provision
in
the Articles Supplementary creating any class or series of Preferred
Shares.
Based
upon the foregoing and subject to the assumptions, limitations and
qualifications stated herein, it is our opinion that:
1.
The
Company is a corporation duly incorporated and validly existing under and
by
virtue of the laws of the State of Maryland and is in good standing with
the
SDAT.
2.
Upon
the
completion of all Corporate Proceedings relating to the Debt Securities,
the
issuance of the Debt Securities will be duly authorized.
3.
Upon
the
completion of all Corporate Proceedings relating to the Common Shares, the
issuance of the Common Shares will be duly authorized and, when and if
issued
and delivered against payment therefor
in
accordance with the Registration Statement and the Corporate Proceedings,
the
Common Shares will be validly issued, fully paid and nonassessable.
Redwood
Trust, Inc.
November
23, 2007
Page
4
4.
Upon
the
completion of all Corporate Proceedings relating to the Preferred Shares,
the
issuance of the Preferred Shares will be duly authorized and, when and if
issued
and delivered against payment therefor in accordance with the Registration
Statement and the Corporate Proceedings, the Preferred Shares will be validly
issued, fully paid and nonassessable.
5. Upon
the
completion of all Corporate Proceedings relating to the Warrants, the issuance
of the Warrants will be duly authorized.
6.
Upon
the
completion of all Corporate Proceedings relating to the Rights, the issuance
of
the Rights will be duly authorized.
7.
Upon
the
completion of all Corporate Proceedings relating to the Units, the issuance
of
the Units will be duly authorized.
The
foregoing opinion is limited to the laws of the State of Maryland and we
do not
express any opinion herein concerning any other law. We express no opinion
as to
the applicability or effect of any federal or state securities laws, including
the securities laws of the State of Maryland, or as to federal or state laws
regarding fraudulent transfer. To the extent that any matter as to which
our
opinion is expressed herein would be governed by the laws of any jurisdiction
other than the State of Maryland, we do not express any opinion on such
matter.
The
opinion expressed herein is limited to the matters specifically set forth
herein
and no other opinion shall be inferred beyond the matters expressly stated.
We
assume no obligation to supplement this opinion if any applicable law changes
after the date hereof or if we become aware of any fact that might change
the
opinion expressed herein after the date hereof.
This
opinion is being furnished to you for your submission to the Commission as
an
exhibit to the Registration Statement. We hereby consent to the filing of
this
opinion as an exhibit to the Registration Statement and to the use of the
name
of our firm therein in the section entitled "Legal Matters" in the Prospectus.
In giving this consent, we do not admit that we are within the category of
persons whose consent is required by Section 7 of the Securities
Act.
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Very truly yours,
/s/ Venable
LLP
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