Andrew P. Stone
About Andrew P. Stone
Andrew P. Stone is Executive Vice President, Chief Legal Officer and Secretary of Redwood Trust, Inc. (RWT). He has been employed by Redwood since December 2008; previously he served as Deputy General Counsel at Thomas Weisel Partners (2006–2008) and practiced corporate and securities law at Sullivan & Cromwell and Brobeck, Phleger & Harrison (1996–2006). He holds a B.A. in mathematics and history from Kenyon College and a J.D. from New York University School of Law. As of 2025, his age is 54 . Company performance context: Redwood’s three‑year TSR (2022–2024) lagged peers and industry indices, while four‑year TSR (2021–2024) exceeded most peers; long‑term PSU and DSU outcomes align with these TSR trends via performance‑ and service‑based vesting .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Redwood Trust, Inc. | Executive Vice President, Chief Legal Officer and Secretary | 2008–present | Senior legal leadership supporting governance, risk, financing and capital markets |
| Thomas Weisel Partners Group, Inc. | Deputy General Counsel | 2006–2008 | Corporate legal leadership in investment banking environment |
| Sullivan & Cromwell LLP | Corporate & Securities Lawyer | 1996–2006 | Complex corporate and securities transactions, capital markets disclosure |
| Brobeck, Phleger & Harrison LLP | Corporate & Securities Lawyer | 1996–2006 | Growth company financing and securities work |
Fixed Compensation
| Metric | 2022 | 2023 | 2024 |
|---|---|---|---|
| Base Salary ($) | $445,000 | $450,000 | $500,000 |
| Bonus ($) | — | — | — |
| Stock Awards ($) | $1,249,990 | $1,499,988 | $1,499,990 |
| Non‑Equity Incentive Plan Compensation ($) | $250,313 | $689,168 | $702,853 |
| All Other Compensation ($) | $27,700 | $28,000 | $31,000 |
| Total ($) | $1,973,003 | $2,667,156 | $2,733,843 |
Additional determinations: The Compensation Committee increased Stone’s annual base salary to $500,000 for 2024 . His 2024 target bonus was set at 175% of salary ($875,000), up from 150% in 2023; the maximum annual bonus cap was reduced to 3.0x target for 2024 and going forward .
Performance Compensation
Annual bonus structure and outcomes for 2024:
| Metric | Weighting | 2024 Plan Target ($) | 2024 Outcome ($) | Bonus Cap ($) | Vesting/Payment |
|---|---|---|---|---|---|
| Adjusted ROE | 37.5% | $875,000 total program target | $702,853 actual earned (aggregate) | $2,625,000 (3.0x target) | Annual cash bonus |
| Adjusted EAD ROE | 37.5% | $875,000 total program target | $702,853 actual earned (aggregate) | $2,625,000 (3.0x target) | Annual cash bonus |
| Individual strategic/operational/risk goals | 25% | $875,000 total program target | $702,853 actual earned (aggregate) | $2,625,000 (3.0x target) | Annual cash bonus |
2023 plan structure mirrored 2024 but included sustainability/ESG goals in the individual component; weights were the same (37.5%/37.5%/25%) .
Long‑term equity awards granted:
| Year | Type | Grant Date | Units (#) | Grant Date Fair Value ($) | Key Terms |
|---|---|---|---|---|---|
| 2024 | DSU | 12/19/2024 | 38,403 | $254,996 | Four‑year vest; DSU/csRSU granted at $6.64/share; fully vest by 12/18/2028 |
| 2024 | csRSU | 12/19/2024 | 74,548 | $494,999 | Four‑year vest; 25% annually |
| 2024 | PSU (target) | 12/19/2024 | 99,966 | $249,915 | Performance‑based vesting; performance goals determine earned units |
| 2023 | DSU | 12/14/2023 | 48,138 | $374,995 | Four‑year vest; quarterly vesting after year 1 |
| 2023 | csRSU | 12/14/2023 | 48,138 | $374,995 | Four‑year vest; 25% annually |
| 2023 | PSU (target) | 12/14/2023 | 85,140 | $212,850 | Performance‑based vesting; performance goals determine earned units |
Award value mix set by Committee for 2023: total $1.5M allocated 50% PSUs ($750,000), 25% DSUs ($375,000), 25% csRSUs ($375,000) .
Options: No stock options outstanding under Redwood’s 2014 Incentive Award Plan as of 12/31/2024 and proxy filing date .
Equity Ownership & Alignment
Beneficial ownership (as of March 27, 2025):
| Holder | Common Shares | DSUs | Total Beneficial Ownership | % of Shares Outstanding |
|---|---|---|---|---|
| Andrew P. Stone | 149,671 | 78,685 | 228,356 | <1% of 132,982,863 shares |
Prior year reference (as of March 28, 2024): Stone beneficially owned 235,411 shares, including 121,887 common and 113,524 DSUs .
Outstanding equity awards at 12/31/2024:
| Metric | Amount |
|---|---|
| Unvested DSUs/csDSUs/csRSUs (#) | 262,224 |
| Market Value of Unvested DSUs/csDSUs/csRSUs ($) | $1,712,323 |
| Unearned PSUs (#) | 301,681 |
| Market/Payout Value of Unearned PSUs ($) | $1,969,977 |
Scheduled DSU vesting (Stone) — supply overhang indicator:
| Vest Date | Units (#) |
|---|---|
| 1/1/2025 | 4,403 |
| 1/31/2025 | 12,035 |
| 4/1/2025 | 7,412 |
| 7/1/2025 | 7,412 |
| 10/1/2025 | 7,412 |
| 12/13/2025 | 1,778 |
| 1/1/2026 | 5,634 |
| 1/31/2026 | 9,601 |
| 4/1/2026 | 8,035 |
| 7/1/2026 | 8,035 |
| 10/1/2026 | 8,034 |
| 12/14/2026 | 2,625 |
| 1/1/2027 | 5,408 |
| 4/1/2027 | 5,408 |
| 7/1/2027 | 5,408 |
| 10/1/2027 | 5,408 |
| 12/14/2027 | 3,008 |
| 1/1/2028 | 2,400 |
| 4/1/2028 | 2,400 |
| 7/1/2028 | 2,400 |
| 10/1/2028 | 2,400 |
| 12/18/2028 | 2,400 |
| Total DSUs Scheduled to Vest (2025–2028) | 119,058 |
Realized vesting in 2024: 141,788 shares vested for Stone, with $1,006,941 value realized .
Ownership guidelines and trading policies:
- Executive stock ownership requirement: 3.0x current salary for non‑CEO executive officers; compliance is measured on acquisition cost for common stock and grant date value for DSUs. All executives were in compliance or within allowed time to attain compliance as of March 27, 2025 .
- Insider Trading Policy prohibits short sales, options trading in Company securities, hedging transactions, margin accounts, and pledging of Company stock .
Employment Terms
Termination benefits — No Change of Control:
| Component | 2020 | 2023 | 2024 |
|---|---|---|---|
| Cash Severance Payment ($) | $1,233,750 | $1,518,750 | $1,906,250 |
| Accelerated Vesting — Long‑Term Cash Awards ($) | $355,000 | — | — |
| Accelerated Vesting — DSUs/csDSUs/csRSUs ($) | $1,026,672 | $1,711,623 | $1,712,323 |
| Benefits ($) | $57,890 | $53,269 | $36,994 |
| Total ($) | $2,673,312 | $3,283,642 | $3,655,567 |
| Benefits Continuation Period | 9–18 months depending on executive | 9–18 months depending on executive | 9–18 months depending on executive |
Termination benefits — Change of Control (double trigger: termination without “cause” or for “good reason” following CoC):
| Component | 2022 | 2023 | 2024 |
|---|---|---|---|
| Cash Severance Payment ($) | $1,750,000 (cap $2,000,000) | $1,800,000 (cap $2,000,000) | $2,000,000 (cap $2,000,000) |
| Accelerated Vesting — Long‑Term Cash Awards ($) | $266,250 | — | — |
| Accelerated Vesting — DSUs/csDSUs/csRSUs ($) | $1,247,369 | $1,711,623 | $1,712,323 |
| Accelerated Vesting — PSUs ($) | $395,083 | $1,497,086 | $1,743,533 |
| Benefits ($) | $37,244 | $71,025 | $49,326 |
| Total ($) | $3,695,946 | $5,079,734 | $5,505,182 |
| Benefits Continuation Period | 12–24 months depending on executive |
Termination — Death or Disability:
| Component | 2022 | 2023 | 2024 |
|---|---|---|---|
| Cash Severance Payment ($) | $667,500 | $675,000 | $875,000 |
| Accelerated Vesting — Long‑Term Cash Awards ($) | $266,250 | — | — |
| Accelerated Vesting — DSUs/csDSUs/csRSUs ($) | $1,247,369 | $1,711,623 | $1,712,323 |
| Total ($) | $2,181,119 | $2,386,623 | $2,587,323 |
Change‑in‑control valuation assumptions: 2023 tables assume $7.41/share; 2024 tables assume $6.53/share; PSU vesting values at CoC reflect estimated performance‑based vesting rates for cohorts (e.g., 2021 PSUs ~27.5% at 12/31/2024) .
Investment Implications
- Alignment: Stone’s pay is heavily equity‑linked via DSUs/csRSUs/PSUs with explicit ROE/EAD ROE bonus metrics and reduced bonus caps, supporting pay‑for‑performance discipline. 2024 program weights (Adjusted ROE 37.5%, Adjusted EAD ROE 37.5%, strategic/risk goals 25%) and cap reduction to 3.0x target signal tighter alignment with shareholder outcomes .
- Retention vs. supply overhang: Significant unvested equity (262,224 DSUs/csRSUs; 301,681 PSUs) plus a defined vesting runway through 2028 (119,058 DSUs scheduled) lowers near‑term departure risk but creates predictable periodic selling pressure as units settle; 141,788 shares vested in 2024 with $1,006,941 realized underscores ongoing supply .
- Governance risk mitigants: Executive stock ownership requirement (3.0x salary) with confirmed compliance, and an Insider Trading Policy that prohibits hedging and pledging, reduce misalignment and collateral risk red flags .
- Change‑of‑control economics: Double‑trigger CoC protection for Stone totals ~$5.5M at 12/31/2024, including a cash severance capped at $2.0M and accelerated equity, which is meaningful but moderated by caps and performance conditioning of PSUs .
- Performance sensitivity: Company TSR dynamics (3‑year lag vs peers; 4‑year outperformance vs peers) have historically flowed through long‑term award outcomes; expect PSU realizations to remain sensitive to book value TSR and relative TSR constructs, impacting Stone’s realized pay and potential share issuance .