Exhibit 4.1


 


WARRANT AGREEMENT


 


between

IMPAC MORTGAGE HOLDINGS, INC.


 


and


 


AMERICAN STOCK TRANSFER & TRUST COMPANY,
LLC


 


Dated October 25, 2022


 


THIS WARRANT AGREEMENT (this
 “Agreement”), dated as of October 25, 2022, is by and between Impac Mortgage Holdings, Inc., a Maryland
corporation (the “Company”), and American Stock Transfer & Trust Company, LLC, a New York limited liability
trust company, as warrant agent (in such capacity, the “Warrant Agent”, also referred to herein as the “Transfer
Agent”).


 


WHEREAS,
on or before the date of this Agreement, the Company has (a) launched an exchange offer (the “Exchange Offer”)
for all of the outstanding shares of the Company’s 9.375% Series B Cumulative Redeemable Preferred Stock, par value $0.01 per
share (the “Series B Preferred Stock”), and the Company’s 9.125% Series C Cumulative Redeemable
Preferred Stock, par value $0.01 per share (the “Series C Preferred Stock”), and (b) sought approval
from the stockholders of the Company for certain amendments (the “Amendments”) to the charter of the Company
(the “Charter”), by (i) soliciting a written consent from the holders of Series B Preferred Stock
and the holders of Series C Preferred Stock, and (ii) calling a special meeting of the holders of the Company’s common
stock, par value $0.01 per share (the “Common Stock”); and


 


WHEREAS,
subject to obtaining the stockholder consents and approvals, the Company proposes to (a) amend the Charter as set forth in the Amendments
and (b) subject to the terms and conditions of the Exchange Offer, close the Exchange Offer; and


 


WHEREAS,
after the closing of the Exchange Offer, the Company proposes to redeem all shares of Series B Preferred Stock and Series C
Preferred Stock that remain outstanding after completion of the Exchange Offer on the terms and conditions set forth in the Amendments
(the “Redemption” and, together with Exchange Offer, collectively, the “Transaction”);
and


 


WHEREAS,
in connection with the Transaction, the Company will issue up to 2,107,629 warrants (the “Warrants”) to former
holders of the Series C Preferred Stock. Each Warrant entitles the holder thereof to purchase one share (each such share, a “Warrant
Share” and, collectively, the “Warrant Shares”) of common stock of the Company, par value $0.01
per share (the “Common Stock”), for an exercise price of $5.00 per share, subject to the terms and subject to
adjustments as described herein. Only whole Warrants are exercisable. A holder of Warrants will not be able to exercise any fraction of
a Warrant. In connection with the Transaction, the Company will issue 1.5 Warrants to each holder of Series C Preferred Stock per
share of Series C Preferred Stock held by such holder, except that the Company will not issue fractional Warrants; if any holder
would be entitled to receive a fractional Warrant, the Company will round down to the nearest whole number of Warrants to be issued in
lieu of the fraction of a Warrant; and


 






    	 		 



    


    

 


WHEREAS, the Company has filed
with the Securities and Exchange Commission (the “Commission”) a Registration Statement on Form S-4, Commission
File No. 333-266167, with the United States Securities and Exchange Commission under the Securities Act of 1933, as amended, and
all amendments thereto (the “Securities Act”), and the related form of prospectus included therein (the “Prospectus”),
for the registration, under the Securities Act of 1933, as amended, of the Warrants; and


 


WHEREAS, the Company desires
the Warrant Agent to act on behalf of the Company, and the Warrant Agent is willing to so act, in connection with the issuance, registration,
transfer, exchange and exercise of the Warrants and the Warrant Shares; and


 


WHEREAS, the Company desires
to provide for the form and provisions of the Warrants, the terms upon which they shall be issued and exercised, and the respective rights,
limitation of rights, and immunities of the Company, the Warrant Agent and the holders of the Warrants; and


 


WHEREAS, all acts and things
have been done and performed which are necessary to make the Warrants, when executed on behalf of the Company and countersigned by or
on behalf of the Warrant Agent (if a physical certificate is issued), as provided herein, the valid, binding and legal obligations of
the Company, and to authorize the execution and delivery of this Agreement.


 


NOW, THEREFORE, in consideration
of the mutual agreements herein contained, the parties hereto agree as follows:


 


1.              Appointment
of Warrant Agent. The Company hereby appoints the Warrant Agent to act as agent for the Company for the Warrants, and the Warrant
Agent hereby accepts such appointment and agrees to perform the same in accordance with the terms and conditions set forth in this Agreement.


 


2.              Warrants.


 


2.1.            Form of
Warrant. Each Warrant shall initially be issued in registered form only upon consummation of the Exchange Offer (the date any Warrants
are first issued pursuant to the consummation of the Exchange Offer, the “Exchange Offer Grant Date”) or upon
consummation of the Redemption.


 


2.2.            Effect
of Countersignature. If the Company determines to issue any physical certificate representing a Warrant, a certificated Warrant shall
be invalid and of no effect and may not be exercised by the holder thereof unless and until countersigned by the Warrant Agent pursuant
to this Agreement.


 


2.3.            Registration.


 


2.3.1.            Warrant
Register. The Warrant Agent shall maintain books (the “Warrant Register”), for the registration of original
issuance and the registration of transfer of the Warrants. Upon the initial issuance of the Warrants in book-entry form, the Warrant Agent
shall issue and register the Warrants in the names of the respective holders thereof in such denominations and otherwise in accordance
with instructions delivered to the Warrant Agent by the Company. Ownership of beneficial interests in the Warrants shall be shown on,
and the transfer of such ownership shall be effected through, records maintained by institutions that have accounts with The Depository
Trust Company (the “Depositary”) (such institution, with respect to a Warrant in its account, a “Participant”).


 






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If the Depositary subsequently
ceases to make its book-entry settlement system available for the Warrants, the Company may instruct the Warrant Agent regarding making
other arrangements for book-entry settlement. In the event that the Warrants are not eligible for, or it is no longer necessary to have
the Warrants available in, book-entry form, the Warrant Agent shall provide written instructions to the Depositary to deliver to the Warrant
Agent for cancellation each book-entry Warrant, and the Company shall instruct the Warrant Agent to deliver to the Depositary definitive
certificates in physical form evidencing such Warrants (“Definitive Warrant Certificates”), which shall be in
the form annexed hereto as Exhibit A.


 


Physical certificates, if
issued, shall be signed by, or bear the facsimile signature of, the President, Chief Financial Officer, or other principal officer of
the Company. In the event the person whose facsimile signature has been placed upon any Warrant shall have ceased to serve in the capacity
in which such person signed the Warrant before such Warrant is issued, it may be issued with the same effect as if he or she had not ceased
to be such at the date of issuance.


 


2.3.2.            Registered
Holder. Prior to due presentment for registration of transfer of any Warrant, the Company and the Warrant Agent may deem and treat
the person in whose name such Warrant is registered in the Warrant Register (the “Registered Holder”) as the
absolute owner of such Warrant and of each Warrant represented thereby (notwithstanding any notation of ownership or other writing on
any physical certificate made by anyone other than the Company or the Warrant Agent), for the purpose of any exercise thereof, and for
all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the contrary.


 


2.4.            Fractional
Warrants. The Company shall not issue fractional Warrants.


 


3.              Terms
and Exercise of Warrants.


 


3.1.            Warrant
Price. Each whole Warrant shall entitle the Registered Holder thereof, subject to the provisions of such Warrant and of this Agreement,
to purchase from the Company one (1) share of Common Stock, at the exercise price of $5.00 per share, subject to the adjustments
provided in Section 4 hereof and in the last sentence of this Section 3.1. The term “Warrant Price”
as used in this Agreement shall mean the price per share (including in cash or by payment of Warrants pursuant to a “cashless exercise,”
to the extent permitted hereunder) described in the prior sentence at which shares of Common Stock may be purchased at the time a Warrant
is exercised.


 


3.2.            Duration
of Warrants. A Warrant may be exercised only during the period (the “Exercise Period”) (A) commencing
on the third (3rd) anniversary of the Exchange Offer Grant Date, or October 26, 2025 (the “Initial Exercise
Date”), and (B) terminating on the date which is ten (10) years after the Exchange Offer Grant Date (the “Expiration
Date”); provided, however, that the exercise of any Warrant shall be subject to the satisfaction of any applicable
conditions, as set forth in subsection 3.3.2 below, with respect to an effective registration statement or a valid exemption therefrom
being available. Each Warrant not exercised on or before the Expiration Date shall become void, and all rights thereunder and all rights
in respect thereof under this Agreement shall cease at 5:00 p.m., Eastern Time, time on the Expiration Date.


 






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3.3.            Exercise
of Warrants.


 


3.3.1.            Payment.
Subject to the provisions of the Warrant and this Agreement, a Warrant may be exercised by the Registered Holder thereof by delivering
to the Warrant Agent at its corporate trust department (i) the Definitive Warrant Certificate evidencing the Warrants to be exercised,
or, in the case of a Warrant represented by a book-entry, the Warrants to be exercised (the “Book-Entry Warrants”)
on the records of the Depositary to an account of the Warrant Agent at the Depositary designated for such purposes in writing by the Warrant
Agent to the Depositary from time to time, (ii) an election to purchase (“Election to Purchase”) any share
of Common Stock pursuant to the exercise of a Warrant, properly completed and executed by the Registered Holder on the reverse of the
Definitive Warrant Certificate or, in the case of a Book-Entry Warrant, properly delivered by the Participant in accordance with the Depositary’s
procedures, and (iii) the payment in full of the Warrant Price for each share of Common Stock as to which the Warrant is exercised
and any and all applicable taxes due in connection with the exercise of the Warrant, the exchange of the Warrant for the shares of Common
Stock and the issuance of such shares of Common Stock, as follows:


 


(a)            in
lawful money of the United States, in good certified check or good bank draft payable to the order of the Company; or


 


(b)            on
a cashless basis, as provided in Section 7.4 hereof.


 


3.3.2.            Issuance
of Shares of Common Stock on Exercise. As soon as practicable after the exercise of any Warrant and the clearance of the funds in
payment of the Warrant Price (if payment is pursuant to subsection 3.3.1(a)), the Company shall issue to the Registered Holder
of such Warrant a book-entry position or certificate, as applicable, for the number of shares of Common Stock to which he, she or it is
entitled, registered in such name or names as may be directed by him, her or it on the register of members of the Company, and if such
Warrant shall not have been exercised in full, a new book-entry position or countersigned Warrant Certificate, as applicable, for the
number of shares as to which such Warrant shall not have been exercised. Notwithstanding the foregoing, the Company shall not be obligated
to deliver any shares of Common Stock pursuant to the exercise of a Warrant and shall have no obligation to settle such Warrant exercise
unless a registration statement under the Securities Act with respect to the shares of Common Stock underlying the Warrants is then effective
and a prospectus relating thereto is current, subject to the Company’s satisfying its obligations under Section 7.4,
or a valid exemption from registration is available. In addition, no Warrant shall be exercisable and the Company shall not be obligated
to issue shares of Common Stock upon exercise of a Warrant unless the shares of Common Stock issuable upon such Warrant exercise have
been registered, qualified or deemed to be exempt from registration or qualification under the securities laws of the state of residence
of the Registered Holder of the Warrants. Subject to Section 4.7 of this Agreement, a Registered Holder of Warrants may exercise
its Warrants only for a whole number of shares of Common Stock. The Company may require holders of Warrants to settle the Warrant on a
 “cashless basis” pursuant to Section 7.4. If, by reason of any exercise of Warrants on a “cashless basis”,
the holder of any Warrant would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share of Common
Stock, the Company shall round down to the nearest whole number, the number of shares of Common Stock to be issued to such holder.


 






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3.3.3.            Valid
Issuance. All shares of Common Stock issued upon the proper exercise of a Warrant in conformity with this Agreement shall be validly
issued, fully paid and nonassessable.


 


3.3.4.            Date
of Issuance. Each person in whose name any book-entry position or certificate, as applicable, for shares of Common Stock is issued
and who is registered as a stockholder of the Company shall for all purposes be deemed to have become the holder of record of such shares
of Common Stock on the date on which the Warrant, or book-entry position representing such Warrant, was surrendered and payment of the
Warrant Price was made, irrespective of the date of delivery of such certificate in the case of a certificated Warrant, except that, if
the date of such surrender and payment is a date when the share transfer books of the Company or book-entry system of the Warrant Agent
are closed, such person shall be deemed to have become the holder of such shares at the close of business on the next succeeding date
on which the share transfer books or book-entry system are open.


 


4.              Adjustments.


 


4.1.            Combinations
and Sub-Divisions. The Purchase Price of the Warrants shall be proportionally decreased and the number of Warrant Shares issuable
upon exercise of the Warrants (or any shares of stock or other securities at the time issuable upon exercise of this Warrant) shall be
proportionally increased to reflect any stock split or sub-division of the Company's Common Stock. The Purchase Price of the Warrants
shall be proportionally increased and the number of Warrant Shares issuable upon exercise of the Warrants (or any shares of stock or other
securities at the time issuable upon exercise of the Warrants) shall be proportionally decreased to reflect any combination of the Company's
Common Stock.


 


4.2.            Extraordinary
Dividends. In case the Company shall make or issue, or shall fix a record date for the determination of eligible holders entitled
to receive, a dividend or other distribution with respect to its Common Stock (or any shares of stock or other securities at the time
issuable upon exercise of the Warrant) payable in (a) securities of the Company or (b) assets (excluding cash dividends), then,
in each such case, the Registered Holder on exercise hereof at any time after the consummation, effective date or record date of such
dividend or other distribution, shall receive, in addition to the Warrant Shares (or such other stock or securities) issuable on such
exercise prior to such date, and without the payment of additional consideration therefor, the securities or such other assets of the
Company to which such Holder would have been entitled upon such date if such Holder had exercised this Warrant on the date hereof and
had thereafter, during the period from the date hereof to and including the date of such exercise, retained such shares and all such additional
securities or other assets distributed with respect to such shares as aforesaid during such period giving effect to all adjustments called
for by this Section 4.


 






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4.3.            Reclassification.
If the Company, by reclassification of securities or otherwise, shall change any of the securities as to which purchase rights under this
Agreement exist into the same or a different number of securities of any other class or classes, the Warrants shall thereafter represent
the right to acquire such number and kind of securities as would have been issuable as the result of such change with respect to the securities
that were subject to the purchase rights under the Warrants immediately prior to such reclassification or other change, and the Purchase
Price therefor shall be appropriately adjusted, all subject to further adjustment as provided in this Section 4. No adjustment
shall be made pursuant to this Section 4.3 upon any conversion or redemption of the Common Stock which is the subject of Section 4.5.


 


4.4.            Adjustment
for Capital Reorganization, Merger or Consolidation. In case of any capital reorganization of the capital stock of the Company (other
than a combination, reclassification, exchange or subdivision of shares otherwise provided for herein), or any merger or consolidation
of the Company with or into another corporation, or the sale of all or substantially all the assets of the Company (together, a “Business
Combination”) then, and in each such case, as a part of such reorganization, merger, consolidation, sale of all or substantially
all the assets, lawful provision shall be made so that the Registered Holder shall thereafter be entitled to receive upon exercise of
the Warrants, during the period specified herein and upon payment of the Purchase Price then in effect, the number of shares of stock
or other securities or property of the successor corporation resulting from such reorganization, merger, consolidation, sale of all or
substantially all the assets that a holder of the Warrant Shares deliverable upon exercise of the Warrants would have been entitled to
receive in such reorganization, consolidation, merger, sale or transfer if the Warrants had been exercised immediately before such reorganization,
merger, consolidation, sale or transfer, all subject to further adjustment as provided in this Section 4. The foregoing provisions
of this Section 4.4 shall similarly apply to successive reorganizations, consolidations, mergers, sales of all or substantially
all the assets and to the stock or securities of any other corporation that are at the time receivable upon the exercise of the Warrants.
If the per-share consideration payable to the Holder hereof for shares in connection with any such transaction is in a form other than
cash or marketable securities, then the value of such consideration shall be determined in good faith by the Company's Board of Directors.
In all events, appropriate adjustment (as determined in good faith by the Company's Board of Directors) shall be made in the application
of the provisions of this Agreement with respect to the rights and interests of the Registered Holder after the transaction, to the end
that the provisions of this Warrant Agreement shall be applicable after that event, as near as reasonably may be, in relation to any shares
or other property deliverable after that event upon exercise of the Warrants. In the event of any Business Combination, at the Company’s
option, the Warrants shall convert into the number of shares of Common Stock, common stock of the successor or acquiring person, and/or
other property that a holder immediately prior to such event of the number of shares of Common Stock for which such Warrants are exercisable
would have owned or received immediately after and as a result of such event.


 


4.5.            Redemption
or Conversion of Common Stock. In case all or any portion of the authorized and outstanding shares of Common Stock of the Company
are redeemed or converted or reclassified into other securities or property pursuant to the Charter or otherwise, or the Common Stock
otherwise ceases to exist, then, in such case, the Registered Holder, upon exercise hereof at any time after the date on which the Common
Stock is so redeemed or converted, reclassified or ceases to exist (the “Termination Date”), shall receive,
in lieu of the number of Warrant Shares that would have been issuable upon such exercise immediately prior to the Termination Date, the
securities or property that would have been received if the Warrants had been exercised in full and the Common Stock received thereupon
had been simultaneously converted immediately prior to the Termination Date, all subject to further adjustment as provided in this Agreement.
Additionally, the Purchase Price shall be immediately adjusted to equal the quotient obtained by dividing (x) the aggregate Purchase
Price of the maximum number of Warrant Shares for which the Warrants were exercisable immediately prior to the Termination Date by (y) the
number of Warrant Shares for which this Warrant is exercisable immediately after the Termination Date, all subject to further adjustment
as provided herein.


 






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4.6.            Notices
of Changes in Warrant. Upon every adjustment of the Warrant Price or the number of shares issuable upon exercise of a Warrant, the
Company shall give written notice thereof to the Warrant Agent, which notice shall state the Warrant Price resulting from such adjustment
and the increase or decrease, if any, in the number of shares purchasable at such price upon the exercise of a Warrant, setting forth
in reasonable detail the method of calculation and the facts upon which such calculation is based. Upon the occurrence of any event specified
in this Section 4 resulting in an adjustment, the Company shall give notice, including by electronic mail, of the occurrence of such
event to each holder of a Warrant, at the last address set forth for such holder in the Warrant Register, of the record date or the effective
date of the event. Failure to give such notice, or any defect therein, shall not affect the legality or validity of such event.


 


4.7.            No
Fractional Shares. Notwithstanding any provision contained in this Agreement to the contrary, the Company shall not issue fractional
shares upon the exercise of Warrants. If, by reason of any adjustment made pursuant to this Section 4, the holder of any Warrant
would be entitled, upon the exercise of such Warrant, to receive a fractional interest in a share, the Company shall, upon such exercise,
round down to the nearest whole number the number of shares of Common Stock to be issued to such holder.


 


4.8.            Form of
Warrant. The form of Warrant Certificate, if any, need not be changed because of any adjustment pursuant to this Section 4,
and Warrants issued after such adjustment may state the same Warrant Price and the same number of shares as is stated in the Warrant Certificates
initially issued pursuant to this Agreement; provided, however, that the Company may at any time in its sole discretion
make any change in the form of Warrant Certificate that the Company may deem appropriate and that does not affect the substance thereof,
and any Warrant Certificate thereafter issued or countersigned, whether in exchange or substitution for an outstanding Warrant Certificate
or otherwise, may be in the form as so changed.


 


5.              Transfer
and Exchange of Warrants.


 


5.1.            Registration
of Transfer. The Warrant Agent shall register the transfer, from time to time, of any outstanding Warrant upon the Warrant Register,
upon surrender of such Warrant for transfer, properly endorsed with signatures properly guaranteed and accompanied by appropriate instructions
for transfer. Upon any such transfer, a new Warrant representing an equal aggregate number of Warrants shall be issued and the old Warrant
shall be cancelled by the Warrant Agent. In the case of certificated Warrants, the Warrants so cancelled shall be delivered by the Warrant
Agent to the Company from time to time upon request.


 






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5.2.            Procedure
for Surrender of Warrants. Warrants may be surrendered to the Warrant Agent, together with a written request for exchange or transfer,
and thereupon the Warrant Agent shall issue in exchange therefor one or more new Warrants as requested by the Registered Holder of the
Warrants so surrendered, representing an equal aggregate number of Warrants; provided, however, that except as otherwise
provided herein or with respect to any Book-Entry Warrant, each Book-Entry Warrant may be transferred only in whole and only to the Depositary,
to another nominee of the Depositary, to a successor depository, or to a nominee of a successor depository.


 


5.3.            Fractional
Warrants. The Warrant Agent shall not be required to effect any registration of transfer or exchange which shall result in the issuance
of a Warrant Certificate or book-entry position for a fraction of a Warrant.


 


5.4.            Service
Charges. No service charge shall be made for any exchange or registration of transfer of Warrants.


 


5.5.            Warrant
Execution and Countersignature. The Warrant Agent is hereby authorized to countersign and to deliver, in accordance with the terms
of this Agreement, the Warrants required to be issued pursuant to the provisions of this Section 5, and the Company, whenever
required by the Warrant Agent, shall supply the Warrant Agent with Warrants duly executed on behalf of the Company for such purpose.


 


6.              [Reserved.]


 


7.              Other
Provisions Relating to Rights of Holders of Warrants.


 


7.1.            No
Rights as Stockholder. A Warrant does not entitle the Registered Holder thereof to any of the rights of a stockholder of the Company,
including, without limitation, the right to receive dividends, or other distributions, exercise any preemptive rights to vote or to consent
or to receive notice as stockholders in respect of the meetings of stockholders or the election of directors of the Company or any other
matter.


 


7.2.            Lost,
Stolen, Mutilated, or Destroyed Warrant Certificates. If any Warrant Certificate is lost, stolen, mutilated, or destroyed, the Company
and the Warrant Agent may on such terms as to indemnity or otherwise as they may in their discretion impose (which shall, in the case
of a mutilated Warrant, include the surrender thereof), issue a new Warrant Certificate of like denomination, tenor, and date as the Warrant
Certificate so lost, stolen, mutilated, or destroyed. Any such new Warrant Certificate shall constitute a substitute contractual obligation
of the Company, whether or not the allegedly lost, stolen, mutilated, or destroyed Warrant shall be at any time enforceable by anyone.


 


7.3.            Reservation
of Shares of Common Stock. The Company shall at all times reserve and keep available a number of its authorized but unissued shares
of Common Stock that shall be sufficient to permit the exercise in full of all outstanding Warrants to be issued pursuant to this Agreement.


 






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7.4.            Registration
of Shares of Common Stock; Cashless Exercise at Company’s Option.


 


7.4.1.            Registration
of the Shares of Common Stock. The Company may, but is not required to, file with the Commission a registration statement for the
registration, under the Securities Act, of the Warrant Shares before the Warrant becomes exercisable. Holders of the Warrants shall have
the right, during any period when the Company has not maintained an effective registration statement covering the issuance of the Warrant
Shares, only to exercise such Warrants on a “cashless basis,” pursuant to subsection 3.3.1, by exchanging the Warrants
(in accordance with Section 3(a)(9) of the Securities Act or another exemption) for that number of shares of Common Stock equal
to the quotient obtained by dividing (a) the product of (1) the number of shares of Common Stock underlying the Warrants and
(2) the excess of the “Fair Market Value” (as defined below) over the Warrant Price by (b) the Fair Market Value.
Solely for purposes of this subsection 7.4.1, “Fair Market Value” shall mean (x) if the Common Stock is traded
on a national securities exchange, the volume-weighted average price of the shares of Common Stock as reported during the five (5) trading
day period ending on the trading day prior to the date that notice of exercise is received by the Warrant Agent from the holder of such
Warrants or its securities broker or intermediary, (y) if the Common Stock is actively traded over-the-counter, the average of the
closing bid prices over the thirty (30)-day period ending immediately prior to the applicable date of valuation and (z) if there
is no active public market for the Common Stock, the value determined in good faith by the Board of Directors. The date that notice of
 “cashless exercise” is received by the Warrant Agent shall be conclusively determined by the Warrant Agent. In connection
with the “cashless exercise” of a Warrant, the Company shall, upon reasonable request, and subject to any reasonable conditions,
qualifications or requirements in order to comply with applicable law and regulation, provide the Warrant Agent with an opinion of counsel
for the Company stating that (i) the exercise of the Warrant on a “cashless basis” in accordance with this subsection
7.4.1 is not required to be registered under the Securities Act and (ii) the shares of Common Stock issued upon such exercise
shall be freely tradable under United States federal securities laws by anyone who is not an affiliate (as such term is defined in Rule 144
under the Securities Act) of the Company and, accordingly, shall not be required to bear a restrictive legend. Upon receipt of an exercise
notice for a “cashless exercise” of a Warrant, the Warrant Agent shall deliver a copy of the exercise notice to the Company
and the Company shall promptly calculate and transmit to the Warrant Agent in writing, the number of Warrant Shares issuable in connection
with such “cashless exercise.” The Warrant Agent shall have no obligation under this Agreement to calculate, the number of
Warrant Shares issuable in connection with a “cashless exercise,” nor shall the Warrant Agent have any duty or obligation
to investigate or confirm whether the Company’s determination of the number of Warrant Shares issuable upon such exercise, pursuant
to Section 7.4, is accurate or correct.


 


7.4.2.            Cashless
Exercise at Company’s Option. If the shares of Common Stock are at the time of any exercise of a Warrant not listed on a national
securities exchange such that they satisfy the definition of a “covered security” under Section 18(b)(1) of the
Securities Act, the Company may, at its option, (a) require holders of Warrants who exercise Warrants to exercise such Warrants on
a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act as described in subsection 7.4.1
and (b) in the event the Company so elects, the Company shall (i) not be required to file or maintain in effect a registration
statement for the registration, under the Securities Act, of the shares of Common Stock issuable upon exercise of the Warrants, notwithstanding
anything in this Agreement to the contrary, and (ii) use its commercially reasonable efforts to register or qualify for sale the
shares of Common Stock issuable upon exercise of the Warrant under applicable blue sky laws of the state of the residence of the holder
to the extent an exemption is not available.


 






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8.              Concerning
the Warrant Agent and Other Matters.


 


8.1.            Payment
of Taxes. The Company shall from time to time promptly pay all taxes and charges that may be imposed upon the Company or the Warrant
Agent in respect of the issuance or delivery of shares of Common Stock upon the exercise of the Warrants, but the Company shall not be
obligated to pay any transfer taxes in respect of the Warrants or such shares.


 


8.2.            Resignation,
Consolidation, or Merger of Warrant Agent.


 


8.2.1.            Appointment
of Successor Warrant Agent. The Warrant Agent, or any successor to it hereafter appointed, may resign its duties and be discharged
from all further duties and liabilities hereunder after giving sixty (60) days’ notice in writing to the Company. If the office
of the Warrant Agent becomes vacant by resignation or incapacity to act or otherwise, the Company shall appoint in writing a successor
Warrant Agent in place of the Warrant Agent. If the Company shall fail to make such appointment within a period of thirty (30) days
after it has been notified in writing of such resignation or incapacity by the Warrant Agent or by the holder of a Warrant (who shall,
with such notice, submit his, her or its Warrant for inspection by the Company), then the holder of any Warrant may apply to the Supreme
Court of the State of New York for the County of New York for the appointment of a successor Warrant Agent at the Company’s cost.
Any successor Warrant Agent, whether appointed by the Company or by such court, shall be a corporation organized and existing under the
laws of the State of New York, in good standing and having its principal office in the Borough of Manhattan, City and State of New York,
and authorized under such laws to exercise corporate trust powers and subject to supervision or examination by federal or state authority.
After appointment, any successor Warrant Agent shall be vested with all the authority, powers, rights, immunities, duties, and obligations
of its predecessor Warrant Agent with like effect as if originally named as Warrant Agent hereunder, without any further act or deed;
but if for any reason it becomes necessary or appropriate, the predecessor Warrant Agent shall execute and deliver, at the expense of
the Company, an instrument transferring to such successor Warrant Agent all the authority, powers, and rights of such predecessor Warrant
Agent hereunder; and upon request of any successor Warrant Agent the Company shall make, execute, acknowledge, and deliver any and all
instruments in writing for more fully and effectually vesting in and confirming to such successor Warrant Agent all such authority, powers,
rights, immunities, duties, and obligations.


 


8.2.2.            Notice
of Successor Warrant Agent. In the event a successor Warrant Agent shall be appointed, the Company shall give notice thereof to the
predecessor Warrant Agent and the Transfer Agent for the shares of Common Stock not later than the effective date of any such appointment.


 


8.2.3.            Merger
or Consolidation of Warrant Agent. Any entity into which the Warrant Agent may be merged or with which it may be consolidated or any
entity resulting from any merger or consolidation to which the Warrant Agent shall be a party shall be the successor Warrant Agent under
this Agreement without any further act.


 






    	 	10	 



    


    

 


8.3            Fees
and Expenses of Warrant Agent.


 


8.3.1.            Remuneration.
The Company agrees to pay the Warrant Agent reasonable remuneration for its services as such Warrant Agent hereunder in accordance with
the fee schedule attached hereto as Schedule A, and shall, pursuant to its obligations under this Agreement, reimburse the Warrant
Agent upon demand for all expenditures that the Warrant Agent may reasonably incur in the execution of its duties hereunder.


 


8.3.2.            Further
Assurances. The Company agrees to perform, execute, acknowledge, and deliver or cause to be performed, executed, acknowledged, and
delivered all such further and other acts, instruments, and assurances as may reasonably be required by the Warrant Agent for the carrying
out or performing of the provisions of this Agreement.


 


8.4.            Liability
of Warrant Agent.


 


8.4.1.            Reliance
on Company Statement. Whenever in the performance of its duties under this Agreement, the Warrant Agent shall deem it necessary or
desirable that any fact or matter be proved or established by the Company prior to taking or suffering any action hereunder, such fact
or matter (unless other evidence in respect thereof be herein specifically prescribed) may be deemed to be conclusively proved and established
by a statement signed by the Chief Executive Officer, President or Chief Financial Officer of the Company and delivered to the Warrant
Agent. The Warrant Agent may rely upon such statement for any action taken or suffered in good faith by it pursuant to the provisions
of this Agreement.


 


8.4.2.            Indemnity.
The Warrant Agent shall be liable hereunder only for its own gross negligence, willful misconduct, fraud or bad faith. The Company agrees
to indemnify the Warrant Agent and save it harmless against any and all out-of-pocket liabilities, including judgments, out-of-pocket
costs and reasonable outside counsel fees, for anything done or omitted by the Warrant Agent in the execution of this Agreement, except
as a result of the Warrant Agent’s gross negligence, willful misconduct, fraud or bad faith.


 


8.4.3.            Exclusions.
The Warrant Agent shall not be responsible for any breach by the Company of any covenant or condition contained in this Agreement or in
any Warrant. The Warrant Agent shall not be responsible to make any adjustments required under the provisions of Section 4
hereof or responsible for the manner, method, or amount of any such adjustment or the ascertaining of the existence of facts that would
require any such adjustment; nor shall it by any act hereunder be deemed to make any representation or warranty as to the authorization
or reservation of any shares of Common Stock to be issued pursuant to this Agreement or any Warrant or as to whether any shares of Common
Stock shall, when issued, be valid and fully paid and nonassessable.


 


8.5.            Acceptance
of Agency. The Warrant Agent hereby accepts the agency established by this Agreement and agrees to perform the same upon the terms
and conditions herein set forth and among other things, shall account promptly to the Company with respect to Warrants exercised and concurrently
account for, and pay to the Company, all monies received by the Warrant Agent for the purchase of shares of Common Stock through the exercise
of the Warrants.


 






    	 	11	 



    


    

 


9.              Miscellaneous
Provisions.


 


9.1.            Successors.
All the covenants and provisions of this Agreement by or for the benefit of the Company or the Warrant Agent shall bind and inure to the
benefit of their respective successors and assigns.


 


9.2.            Notices.
Any notice, statement or demand authorized by this Agreement to be given or made by the Warrant Agent or by the holder of any Warrant
to or on the Company shall be sufficiently given when so delivered if by hand or overnight delivery or if sent by certified mail or private
courier service within five (5) days after deposit of such notice, postage prepaid, addressed (until another address is filed in
writing by the Company with the Warrant Agent), as follows:


 


Impac
Mortgage Holdings, Inc.

19500 Jamboree Road, 

Irvine, California 92612

Attention: General Counsel

E-mail: GeneralCounselDG@impacmail.com


 


Any notice, statement or demand authorized by
this Agreement to be given or made by the holder of any Warrant or by the Company to or on the Warrant Agent shall be sufficiently given
when so delivered if by hand or overnight delivery or if sent by certified mail or private courier service within five (5) days after
deposit of such notice, postage prepaid, addressed (until another address is filed in writing by the Warrant Agent with the Company),
as follows:


 


American
Stock Transfer & Trust Company, LLC

6201 15th Avenue

Brooklyn, NY 11219

Attention: Reorg Group/Warrants

ReorgWarrants@astfiancial.com


 


With copy to:


 


American Stock Transfer & Trust
Company, LLC


48 Wall Street, 22nd Floor


New York, NY 10005


Attention: Legal Department


Email:
legalteamAST@astfinancial.com


 


9.3.            Applicable
Law. The validity, interpretation, and performance of this Agreement and of the Warrants shall be governed in all respects by the
laws of the State of New York, without giving effect to conflicts of law principles that would result in the application of the substantive
laws of another jurisdiction. The Company hereby agrees that any action, proceeding or claim against it arising out of or relating in
any way to this Agreement shall be brought and enforced in the courts of the State of New York or the United States District Court for
the Southern District of New York, and irrevocably submits to such jurisdiction. The Company hereby waives any objection to such jurisdiction
and that such courts represent an inconvenient forum.


 






    	 	12	 



    


    

 


9.4.            Persons
Having Rights under this Agreement. Nothing in this Agreement shall be construed to confer upon, or give to, any person or corporation
other than the parties hereto and the Registered Holders of the Warrants any right, remedy, or claim under or by reason of this Agreement
or of any covenant, condition, stipulation, promise, or agreement hereof. All covenants, conditions, stipulations, promises, and agreements
contained in this Agreement shall be for the sole and exclusive benefit of the parties hereto and their successors and assigns and of
the Registered Holders of the Warrants.


 


9.5.            Examination
of the Warrant Agreement. A copy of this Agreement shall be available at all reasonable times at the office of the Warrant Agent in
the Borough of Manhattan, City and State of New York, for inspection by the Registered Holder of any Warrant. The Warrant Agent may require
any such holder to submit such holder’s Warrant for inspection by the Warrant Agent.


 


9.6.            Counterparts.
This Agreement may be executed in any number of original or facsimile counterparts and each of such counterparts shall for all purposes
be deemed to be an original, and all such counterparts shall together constitute but one and the same instrument.


 


9.7.            Effect
of Headings. The section headings herein are for convenience only and are not part of this Agreement and shall not affect the interpretation
thereof.


 


9.8.            Amendments.
This Agreement may be amended by the parties hereto without the consent of any Registered Holder for the purpose of curing any ambiguity,
or curing, correcting or supplementing any defective provision contained herein (including conforming the provisions hereof to the description
of the terms of the Warrants and this Agreement set forth in the Registration Statement) or adding or changing any other provisions with
respect to matters or questions arising under this Agreement as the parties may deem necessary or desirable and that the parties deem
shall not adversely affect the interest of the Registered Holders. All other modifications or amendments, including but not limited to
any modifications or amendment to increase the Warrant Price or shorten the Exercise Period (other than as contemplated by this Agreement)
and any amendment to the terms of the Warrants, shall require the vote or written consent of the Registered Holders of a majority of the
then outstanding Warrants.


 


9.9.            Severability.
This Agreement shall be deemed severable, and the invalidity or unenforceability of any term or provision hereof shall not affect the
validity or enforceability of this Agreement or of any other term or provision hereof. Furthermore, in lieu of any such invalid or unenforceable
term or provision, the parties hereto intend that there shall be added as a part of this Agreement a provision as similar in terms to
such invalid or unenforceable provision as may be possible and be valid and enforceable.


 


Exhibit A: Form of Warrant Certificate


 






    	 	13	 



    


    

 


IN WITNESS WHEREOF, the parties
hereto have caused this Agreement to be duly executed as of the date first above written.


 


	 	 	IMPAC MORTGAGE HOLDINGS, INC.
	 	 	 
	 	 	By:	/s/ Joseph O. Joffrion                    
	 	 	Name: Joseph O. Joffrion
	 	 	Title: General Counsel
	 	 	 
	 	 	AMERICAN STOCK TRANSFER & TRUST COMPANY, LLC
	 	 	as Warrant Agent
	 	 	 
	 	 	By:	 /s/ Michael Legregin
	 	 	Name: Michael Legregin
	 	 	Title: Senior Vice President, Corporate Actions Relationship Management & Operations




 


[Signature Page to Warrant Agreement]


 






    	 		 



    


    

 


 


SCHEDULE
A


 


Fee Schedule


 


	Acceptance Fee:	 	$	3,500.00	 
	Monthly Warrant Agent Fee:	 	$	500.00	 
	Per Warrant Exercise Fee:	 	$	50.00	 



 






    	 		 



    


    

 


EXHIBIT A


 


Form of Warrant Certificate


 


[FACE]


 


Number


 


Warrants


 


THIS
WARRANT SHALL BE VOID IF NOT EXERCISED PRIOR TO

THE EXPIRATION OF THE EXERCISE PERIOD PROVIDED FOR 

IN THE WARRANT AGREEMENT DESCRIBED BELOW


 


IMPAC
MORTGAGE HOLDINGS, INC.

Incorporated Under the Laws of the State of Maryland


 


CUSIP 45254P 110


 


Warrant Certificate


 


This
Warrant Certificate certifies that _____________________________, or registered assigns, is the registered holder of ______________________
(_______) warrant(s) evidenced hereby (the “Warrants” and each, a “Warrant”)
to purchase shares of Common Stock, $0.01 par value (the “Common Stock”), of Impac Mortgage Holdings, Inc.,
a Maryland corporation (the “Company”). Each Warrant entitles the holder, upon exercise during the period set
forth in the Warrant Agreement referred to below, to receive from the Company that number of fully paid and nonassessable shares of Common
Stock as set forth below, at the exercise price (the “Warrant Price”) as determined pursuant to the Warrant
Agreement, payable in lawful money (or through “cashless exercise” as provided for in the Warrant Agreement)
of the United States of America upon surrender of this Warrant Certificate and payment of the Warrant Price at the office or agency of
the Warrant Agent referred to below, subject to the conditions set forth herein and in the Warrant Agreement. Defined terms used in this
Warrant Certificate but not defined herein shall have the meanings given to them in the Warrant Agreement.


 


Each whole Warrant is initially
exercisable for one fully paid and nonassessable share of Common Stock. No fractional shares will be issued upon exercise of any Warrant.
If, upon the exercise of Warrants, a holder would be entitled to receive a fractional interest in a share of Common Stock, the Company
will, upon exercise, round down to the nearest whole number the number of shares of Common Stock to be issued to the Warrant holder. The
number of shares of Common Stock issuable upon exercise of the Warrants is subject to adjustment upon the occurrence of certain events
as set forth in the Warrant Agreement.


 


The initial Warrant Price
per one share of Common Stock for any Warrant is equal to $5.00 per share. The Warrant Price is subject to adjustment upon the occurrence
of certain events as set forth in the Warrant Agreement.


 


Subject to the conditions
set forth in the Warrant Agreement, the Warrants may be exercised only during the Exercise Period and to the extent not exercised by the
end of such Exercise Period, such Warrants shall become void.


 


Reference is hereby made to
the further provisions of this Warrant Certificate set forth on the reverse hereof and such further provisions shall for all purposes
have the same effect as though fully set forth at this place.


 


This Warrant Certificate shall
not be valid unless countersigned by the Warrant Agent, as such term is used in the Warrant Agreement.


 


This Warrant Certificate shall
be governed by and construed in accordance with the internal laws of the State of New York, without regard to conflicts of laws principles
thereof.


 






    	 	A-1	 



    


    

 


	IMPAC MORTGAGE HOLDINGS, INC.	 	AMERICAN
STOCK TRANSFER & TRUST COMPANY, LLC
	 	 	as Warrant Agent
	 	 	 	 	 
	By:	                 	 	By:	                      
	Name:	 	Name:
	Title:	 	Title:



 



    	 		 



    


    

 


[Form of Warrant Certificate]


[Reverse]


 


The Warrants evidenced by
this Warrant Certificate are part of a duly authorized issue of Warrants entitling the holder on exercise to receive shares of Common
stock and are issued or to be issued pursuant to a Warrant Agreement dated as of October 25, 2022 (the “Warrant
Agreement”), duly executed and delivered by the Company to American Stock Transfer & Trust Company, LLC, a New
York limited liability trust company, as warrant agent (the “Warrant Agent”), which Warrant Agreement is hereby
incorporated by reference in and made a part of this instrument and is hereby referred to for a description of the rights, limitation
of rights, obligations, duties and immunities thereunder of the Warrant Agent, the Company and the holders (the words “holders”
or “holder” meaning the Registered Holders or Registered Holder, respectively) of the Warrants. A copy of the
Warrant Agreement may be obtained by the holder hereof upon written request to the Company. Defined terms used in this Warrant Certificate
but not defined herein shall have the meanings given to them in the Warrant Agreement.


 


Warrants may be exercised
at any time during the Exercise Period set forth in the Warrant Agreement. The holder of Warrants evidenced by this Warrant Certificate
may exercise them by surrendering this Warrant Certificate, with the form of Election to Purchase set forth hereon properly completed
and executed, together with payment of the Warrant Price as specified in the Warrant Agreement (or through “cashless exercise”
as provided for in the Warrant Agreement) at the principal corporate trust office of the Warrant Agent. In the event that upon any exercise
of Warrants evidenced hereby the number of Warrants exercised shall be less than the total number of Warrants evidenced hereby, there
shall be issued to the holder hereof or his, her or its assignee, a new Warrant Certificate evidencing the number of Warrants not exercised.


 


Notwithstanding anything
else in this Warrant Certificate or the Warrant Agreement, no Warrant may be exercised unless at the time of exercise (i) a registration
statement covering the issuance of the shares of Common Stock to be issued upon exercise is effective under the Securities Act and (ii) a
prospectus thereunder relating to the shares of Common Stock is current, except through “cashless exercise”
as provided for in the Warrant Agreement.


 


The Warrant Agreement provides
that upon the occurrence of certain events the number of shares of Common Stock issuable upon exercise of the Warrants set forth on the
face hereof may, subject to certain conditions, be adjusted. If, upon exercise of a Warrant, the holder thereof would be entitled to receive
a fractional interest in a share of Common Stock, the Company shall, upon exercise, round down to the nearest whole number of shares of
Common Stock to be issued to the holder of the Warrant.


 


Warrant Certificates, when
surrendered at the principal corporate trust office of the Warrant Agent by the Registered Holder thereof in person or by legal representative
or attorney duly authorized in writing, may be exchanged, in the manner and subject to the limitations provided in the Warrant Agreement,
but without payment of any service charge, for another Warrant Certificate or Warrant Certificates of like tenor evidencing in the aggregate
a like number of Warrants.


 


Upon due presentation for
registration of transfer of this Warrant Certificate at the office of the Warrant Agent a new Warrant Certificate or Warrant Certificates
of like tenor and evidencing in the aggregate a like number of Warrants shall be issued to the transferee(s) in exchange for this
Warrant Certificate, subject to the limitations provided in the Warrant Agreement, without charge except for any tax or other governmental
charge imposed in connection therewith.


 


The Company and the Warrant
Agent may deem and treat the Registered Holder(s) hereof as the absolute owner(s) of this Warrant Certificate (notwithstanding
any notation of ownership or other writing hereon made by anyone), for the purpose of any exercise hereof, of any distribution to the
holder(s) hereof, and for all other purposes, and neither the Company nor the Warrant Agent shall be affected by any notice to the
contrary. Neither the Warrants nor this Warrant Certificate entitles any holder hereof to any rights of a stockholder of the Company.


 






    	 		 



    


    

 


Election to Purchase


 


(To Be Executed Upon Exercise of Warrant)


 


The undersigned hereby irrevocably
elects to exercise the right, represented by this Warrant Certificate, to receive shares of Common Stock and herewith tenders payment
for such shares of Common Stock to the Company in the amount of $                                            
in accordance with the terms hereof. The undersigned requests that a certificate for such shares of Common Stock be registered in
the name of                                                                     ,
whose address is                                                                                                                                                               ,
and that such shares of Common Stock be delivered to                                                                                                  ,
whose address is                                                                                                                                                               .
If said number of shares of Common Stock is less than all of the shares of Common Stock purchasable hereunder, the undersigned requests
that a new Warrant Certificate representing the remaining balance of such shares of Common Stock be registered in the name of                                ,
whose address is                                                                                                                                                               ,
and that such Warrant Certificate be delivered to                                                                                                            ,
whose address is                                                                                                                                                               .


 


In the event that the Warrant
is to be exercised on a “cashless” basis pursuant to Section 7.4 of the Warrant Agreement, the number of shares
of Common Stock that this Warrant is exercisable for shall be determined in accordance with Section 7.4 of the Warrant Agreement.


 


In the event that the Warrant
may be exercised, to the extent allowed by the Warrant Agreement, through cashless exercise (i) the number of shares of Common Stock
that this Warrant is exercisable for would be determined in accordance with the relevant section of the Warrant Agreement which allows
for such cashless exercise and (ii) the holder hereof shall complete the following: The undersigned hereby irrevocably elects to
exercise the right, represented by this Warrant Certificate, through the cashless exercise provisions of the Warrant Agreement, to receive
shares of Common Stock. If said number of shares is less than all of the shares of Common Stock purchasable hereunder (after giving effect
to the cashless exercise), the undersigned requests that a new Warrant Certificate representing the remaining balance of such shares of
Common Stock be registered in the name of                                                                                                                                                                                      ,
whose address is                                                                                                                                                               ,
and that such Warrant Certificate be delivered to                                                                                                            ,
whose address is                                                                                                                                                               .


 


Date:                 ,
20    


 


	Signature Guaranteed:	 	 
	 	 	(Name)
	 	 	 
	 	 	 
	
     

    THE SIGNATURE(S) SHOULD BE GUARANTEED BY
    AN ELIGIBLE GUARANTOR INSTITUTION (BANKS, STOCKBROKERS, SAVINGS AND LOAN ASSOCIATIONS AND CREDIT UNIONS WITH MEMBERSHIP IN AN APPROVED
    SIGNATURE GUARANTEE MEDALLION PROGRAM, PURSUANT TO S.E.C. RULE 17Ad-15 UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED).

     

     
	 	(Signature)
	 	 
	 	 
	 	 
	 	 
	 	 
	 	 (Address) 
	 	 
	 	 
	 	(Tax Identification Number)