Document:

Exhibit 10.3

EMPLOYMENT AGREEMENT

THIS EMPLOYMENT AGREEMENT
is made as of May 1, 2006 and is to be effective as of January 1,
2006, by and between Impac Commercial Capital Corporation (“ICCC”), a
California corporation (“Employer”), and William D. Endresen, an individual (“Employee”).

R E C I T A L S

WHEREAS, Employee is
knowledgeable of and skillful in the business of Employer, which includes
originating and closing of Commercial and Multifamily loans (the “Business”);

WHEREAS, Employer
believes that Employee is an integral part of its management and currently is
and will become more knowledgeable of and be in part responsible for developing
the Business;

WHEREAS, Employee
possesses extensive management experience and knowledge regarding the Business,
including confidential information concerning service marketing plans and
strategy, business plans and projections and the formulas and models pertaining
thereto, customer needs and peculiarities, finances, operations, billing
methods and customer lists; and

WHEREAS, Employee is
willing to be employed by Employer and provide services to Employer and any
affiliates or related entities of Employer (as more fully described in Exhibit A
attached hereto) under the terms and conditions herein stated.

A G R E E M E N T

NOW, THEREFORE, in
consideration of the mutual covenants and agreements hereinafter contained, and
for other good and valuable consideration, it is hereby agreed by and between
the parties hereto as follows:

1.             Employment, Services and Duties.

 

1.1           Employer
hereby employs Employee and Employee hereby accepts such employment full-time
(subject to those exceptions, if any, set forth below) as President of Employer
to perform the duties and functions set forth in Exhibit A attached
hereto and to perform such other duties or functions as are reasonably required
or as may be prescribed from time to time or as otherwise agreed. Employee
shall render his services by and subject to the instructions and under the
direction of the Employer’s Board of Directors and to such persons as the Board
may designate, including the President, Chief Operating Officer and CEO of
Impac Mortgage Holdings, Inc., to whom Employee shall directly report.

1.2           Employee
acknowledges and agrees that Employee may be required by Employer to devote a
portion of his working time to perform functions for Employer’s affiliates or
related entities (as set forth in Exhibit A attached hereto) and
that such services are to be performed pursuant to and consistent with Employee’s
duties and obligations under this Agreement.

 

1.3           Employee
will at all times faithfully, industriously and to the best of his ability,
experience and talents perform all of the duties required of and from him
pursuant to the terms of this Agreement. Employee will devote his full business
energies and abilities and all of his business time to the performance of his
duties hereunder and will not, without Employer’s prior written consent, render
to others any service of any kind (whether or not for compensation) that would
interfere with the full performance of Employee’s duties hereunder, and in no
event will engage in any activities that compete with the Business or that
could create a reasonably foreseeable conflict of interest or the appearance of
a reasonably foreseeable conflict of interest; provided that nothing contained
in this Section 1.3 shall preclude Employee from engaging in or managing
Employee’s outside investments.

2.             Term
and Termination.

 

2.1           The
term of this Agreement shall be through December 31, 2008, unless extended
by the mutual written agreement of Employer and Employee.

2.2           Employee’s
employment shall terminate prior to the expiration of the term set forth in Section 2.1
upon the happening of any of the following events:

(a)           Voluntary
termination by Employee other than for Good Reason (as defined below); provided
that Employee shall be required to provide Employer with at least 30 days prior
written notice of such voluntary termination;

(b)           Death
of Employee;

(c)           Employer
may terminate Employee under this Agreement for “cause” if any of the following
occurs (any determination of “cause” as used in this Agreement shall be made
only by an affirmative majority vote of the Board of Directors (not including
Employee in the deliberations or vote on the same, if a director) of Employer):

(i)            Employee
is convicted of (or pleads nolo contendere to) (A) a crime of dishonesty
or breach of trust, including such a crime involving either the property of
Employer or Employer’s parent corporation, Impac Mortgage Holdings, Inc. (“IMH”)
(or any affiliate or related entity of Employer or IMH) or the property
entrusted to Employer or IMH (or any affiliate or related entity of Employer or
IMH) by its clients, including fraud, or embezzlement or other misappropriation
of funds belonging to Employer or IMH (or any affiliate or related entity of
Employer or IMH) or any of their respective clients, or (B) a felony
leading to incarceration of more than 90 days or the payment of a penalty or
fine of $100,000 or more;

(ii)           Employee
materially and substantially fails to perform Employee’s job duties properly
assigned to Employee after being provided 30 days prior written notification by
the Board of Directors of Employer setting forth those duties that are not
being performed by Employee; provided that Employee shall have a reasonable
time to correct any such failures to the extent that such failures are
correctable and Employer may not terminate Employee for “cause” on the basis on
any such failure that is cured within a reasonable time.

 2
 

 

(iii)          Employee
has engaged in willful misconduct or gross negligence in connection with his
service to Employer or IMH (or any affiliate or related entity of Employer or
IMH) that has caused or is causing material harm to Employer or IMH (or any
affiliate or related entity of Employer or IMH); or

(iv)          Employee’s
material breach of any of the terms of this Agreement or any other obligation
that Employee owes to Employer or IMH (or any affiliate or related entity of
Employer or IMH), including a material breach of trust or fiduciary duty or a
material breach of any proprietary rights and inventions or confidentiality
agreement between Employer and Employee or between IMH and Employee (or between
Employee and any affiliate or related entity of Employer or IMH)(as such
agreements may be adopted or amended from time to time by Employer and
Employee).

(d)           By
mutual agreement between Employer and Employee;

(e)           The
date when Employee is declared legally incompetent under the laws of the State
of California, or if Employee has a mental or physical condition that can
reasonably be expected to prevent Employee from carrying out his essential
duties and obligations under this Agreement for a period of greater than six
months (any such condition an “Incapacitating Condition”), notwithstanding
Employer’s reasonable accommodations (to the extent required by law);

(f)            Employer
may terminate Employee under this Agreement at will (and without cause) upon
written notice at any time. Unless otherwise provided in such notice, such
termination shall be effective immediately upon providing written notice to
Employee; or

(g)           Employee
may terminate his employment under this Agreement for Good Reason upon
providing Employer at least 30 days prior written notice of such termination
stating the basis on which Employee has determined that he has Good Reason to
terminate his employment; provided that Employer shall have a reasonable time
after receiving such notice to cure any event that would constitute Good Reason
for Employee to terminate his employment (provided such event is curable) and
Employee may not terminate his employment for Good Reason on the basis of any
such event that is cured within a reasonable time. “Good Reason” shall mean:

(i)            the
assignment to Employee of duties materially inconsistent with, or a substantial
reduction or alteration in, the authority, duties or responsibilities of
Employee as set forth in this Agreement, without Employee’s prior written
consent;

(ii)           the
principal place of the performance of Employee’s responsibilities and duties is
changed to a location more than 65 miles from the location of such place as of
the date of this Agreement, without Employee’s prior written consent;

 3
 

 

(iii)          a
material breach by Employer of this Agreement, including a reduction by Employer
of Employee’s Base Salary, without Employee’s prior written consent; or

(iv)          a
failure by Employer to obtain from IMH or any acquirer of Employer, before any
Acquisition (as defined below) takes place, an agreement to assume and perform
this Agreement.

Good Reason does not include the expiration of the
term of this Agreement on December 31, 2008.

2.3           Except
as set forth in Section 4, in the event that Employee’s employment is
terminated pursuant to Section 2.2(a), 2.2(b), 2.2(c), 2.2(d) or 2.2(e) herein,
neither Employer nor Employee shall have any remaining duties or obligations
under this Agreement, except that Employer shall pay to Employee, or his legal
representatives, on the date of termination of employment (the “Termination
Date”) or, with respect to any Bonus Incentive Compensation payments or
reimbursement for expenses, as promptly as practical after the Termination
Date, the following:

(a)           Such
compensation as is due pursuant to Sections 3.1 (a) and 3.1(b)(i)(ii)(iii) prorated
through the Termination Date;

(b)           Any
expense reimbursements due and owing to Employee for reasonable and necessary
business and entertainment expenses of Employer incurred by Employee prior to
the Termination Date; and

(c)           The
dollar value of all accrued and unused paid time off as defined in Section 3.1
(c) that Employee is entitled to through the Termination Date.

2.4           Except
as set forth in Section 4, in the event that Employee’s employment is
terminated pursuant to Section 2.2(f) or 2.2(g), neither Employer nor
Employee shall have any remaining duties or obligations under this Agreement,
except that Employer shall pay to Employee, or his representatives, the amounts
set forth in Section 2.3 at the times set forth in Section 2.3 and
the following (provided that payments for health insurance coverage shall be
made to an insurance provider):

(a)           An
additional 18 month’s worth of Base Salary as defined in Section 3.1 (a) to
be paid in equal installments over 18 months after Employee signs and delivers
to Employer the Waiver and Release Agreement required pursuant to Section 2.5;
and

(b)           Premiums
for continuation of Employee’s health insurance benefit; under Employer’s group
health insurance plan, for the 18 month period succeeding the Termination Date
(with such health insurance coverage to be at a level and quality equivalent to
the health insurance coverage provided by Employer to Employee

 4
 

 

immediately prior to the
Termination Date, “Equivalent Coverage”). Employer agrees to transmit following
the Termination Date a request (and to join in such request) from Employee to
Employer’s then group health insurance carrier seeking approval to maintain
Employee’s coverage for such period under Employer’s group plan as though
Employee were still employed and without reference to COBRA; provided that i)
Employer makes no representation concerning any future health insurance carrier’s
willingness to consent to such additional coverage; ii) Employer undertakes no
obligation to secure such consent. In the event that such consent is not forthcoming,
then Employee’s continuation coverage shall be subject to COBRA. Employer shall
pay such premiums only so long as (during said 18 month period) Employee
remains eligible for such Equivalent Coverage;

(c)           For
a period of 18 months after the Termination Date occurs, Employee shall be paid
in equal installments an amount equal to the average Bonus Incentive
Compensation under Sections 3.1(b)(i)(ii)(iii)(iv) of this Agreement or
similar Bonus Incentive Compensation under prior Employment Agreements that
Employee received during the 18 month period that preceded the Termination
Date.

(d)           The
payments set forth in Sections 2.4(a), (b) and (c) above are referred
to herein collectively as the “Severance Payments” and each as a “Severance
Payment.”

2.5           As
a condition precedent of Employee or his estate receiving any Severance Payment
from Employer, whether in a lump sum payment or a string of payments or in the
form of payment of benefits, Employee or his estate shall, in consideration for
payment of such amount or benefit, sign and deliver to Employer (against the
execution and delivery of the same by the other parties thereto) the form of
Waiver and Release Agreement attached hereto as Exhibit B. Such
Waiver and Release Agreement will not be construed to include any release of
any indemnification rights Employee may have against Employer pursuant to
Employer’s Articles of Incorporation or bylaws, any indemnification agreement
or California Labor Code Section 2800.

2.6           This
Agreement shall not be terminated by Employer merging with or otherwise being
acquired by another entity, whether or not Employer is the surviving entity, or
by Employer transferring of all or substantially all of its assets (any such
event, an “Acquisition”).

2.7           In
the event of any Acquisition, the surviving entity or transferee, as the case
may be, shall be bound by and shall have the benefits of this Agreement, and
Employer shall not enter into any Acquisition unless the surviving entity or
transferee, as the case may be, agrees to be bound by the provisions of this
Agreement.

 5
 

 

3.             Compensation.

 

3.1           As
the total consideration for Employee’s services rendered hereunder, Employee
shall be entitled to the following during the period that Employee is employed
hereunder:

(a)           A
base salary of $250,000 per year (“Base Salary”), payable in equal installments
bi-weekly on those days when Employer normally pays its employees. Base Salary
will be subject to an annual cost of living adjustment based upon the Consumer
Price Index (“CPI”) on each annual anniversary date from the date of this
Agreement;

(b)           Total
annual Bonus Incentive Compensation in an annual amount up to $900,000 to be
allocated as follows: (i) up to $250,000 based upon quarterly Portfolio
Credit Quality goals; as more fully defined in Section 3.1(b)(i); (ii) up
to $250,000 based upon quarterly Individual Management Objectives, as more
fully defined in Section 3.1(b)(ii); (iii)up to $300,000 based upon
Quarterly Production Goals, as more fully defined in Section 3.1(b)(iii);
and (iv) up to $100,000 as an Annual Production Incentive, as more fully
defined in Section 3.1(b)(iv). The Bonus Incentive Compensation shall be
determined quarterly by Employer and shall be paid within Thirty (30) days of
each quarter end for which the bonus has been earned, with the exception of the
Annual Production Incentive which will be paid, if earned, within Thirty (30)
days of year end. 

(i)            Portfolio Credit Quality Bonus. Up to
$250,000 of the Bonus Incentive Compensation shall be based upon Portfolio Credit
Quality which will be mutually agreed upon quarterly by Employee and Employer’s
Board of Directors or their designees in conjunction with the annual business
plan of ICCC. The Portfolio Credit Quality bonus shall be calculated each
quarter by multiplying (i) $62,500 (the maximum attainable quarterly
Portfolio Credit Quality Bonus x (ii) the Bonus Factor based on percentage
completion of quarterly goals as follows:

	
  % Completion of Quarterly

  Goals

  	
   

  	
  Bonus
  Factor

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 50%

  	
   

  	
  0

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  50 to 75%

  	
   

  	
  50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  75.01% to 99.99%

  	
   

  	
  75

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  100% or more

  	
   

  	
  100

  	
  %

  

 

 6
 

 

(ii)           Individual Management Objectives Bonus. Up
to $250,000 of the Bonus Incentive Compensation shall be based upon quarterly
Individual Management Objectives which will be mutually agreed upon quarterly
by Employee and Employer’s Board of Directors or their designees in conjunction
with the annual business plan of ICCC. The Individual Management Objectives
Bonus shall be calculated each quarter by multiplying (i) $62,500 (the
maximum attainable quarterly Individual Management Objectives Bonus x (ii) the
Bonus Factor based on percentage completion of quarterly goals as follows:

	
  % Completion of Quarterly

  Goals

  	
   

  	
  Bonus
  Factor

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 50%

  	
   

  	
  0

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  50 to 75%

  	
   

  	
  50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  75.01% to 99.99%

  	
   

  	
  75

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  100% or more

  	
   

  	
  100

  	
  %

  

 

(iii)          Quarterly Production Goals Bonus. Up to
$300,000 of the Bonus Incentive Compensation shall be based upon Quarterly
Production Goals which will be mutually agreed upon by Employee and Employer’s
Board of Directors or their designees in conjunction with the annual business
plan of ICCC. The Quarterly Production Goals Bonus shall be calculated each
quarter by multiplying (i) $75,000 (the maximum attainable Quarterly
Production Goals Bonus x (ii) the Bonus Factor based on percentage
completion of quarterly goals as follows:

	
  % Completion of Quarterly

  Goals

  	
   

  	
  Bonus
  Factor

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 75%

  	
   

  	
  0

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  75 to 79.99%

  	
   

  	
  50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  80% to 89.99%

  	
   

  	
  60

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  90% to 99.99%

  	
   

  	
  80

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  100% or more

  	
   

  	
  100

  	
  %

  

 

 7
 

 

 

(iv)          Annual Production Incentive Bonus. Up to
$100,000 of the Bonus Incentive Compensation shall be based upon an Annual
Production Incentive which will be mutually agreed upon by Employee and
Employer’s Board of Directors or their designees in conjunction with the annual
business plan of ICCC. The Annual Production Incentive bonus shall be
calculated yearly by multiplying (i) $100,000 (the maximum attainable
Annual Production Incentive Bonus x (ii) the Bonus Factor based on
percentage completion of annual production goals as follows:

	
  % Completion of Annual

  Production Goals

  	
   

  	
  Bonus
  Factor

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Less than 100%

  	
   

  	
  0

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  100% or more

  	
   

  	
  100

  	
  %

  

 

(c)           Employee
shall accrue paid time off during the period he is employed hereunder at the
rate of four weeks per calendar year, subject to any vacation benefit accrual
cap established by Employer (i.e., once the cap has been reached, further
accrual shall cease until Employee uses some or all of his accrued time to fall
below the accrual cap). The timing of Employee’s vacation shall be governed by
Employer’s usual policies applicable to all employees;

(d)           Employee
is entitled to participate in any policies or plans regarding benefits of
employment, including pension, profit sharing, group health, disability
insurance and other employee welfare benefit plans now existing or hereafter
established to the extent that Employee is eligible under the terms of such
plans. Despite the foregoing, Employee is entitled to participate in any such
plan or program only if the executive officers of Employer generally are
eligible to participate in such plan or program. Employer may, in its sole
discretion and from time to time, establish additional senior management
benefit programs as it deems them appropriate. Employee understands that any
such plans may be modified or eliminated in Employer’s sole discretion in accordance
with applicable law; and

(e)           Such
other benefits as the Board of Directors of Employer, in its sole discretion,
may from time to time provide.

3.2           During
the period that Employee is employed hereunder, Employer shall reimburse
Employee for reasonable and necessary business and entertainment expenses
incurred by Employee on behalf of Employer in connection with the performance
of Employee’s duties hereunder.

 8
 

 

3.3           There
shall be no other automatic adjustments to any of the compensation paid to
Employee under this Agreement other than as described in Section 3.1 (a) .

3.4           Employer
shall have the right to deduct from the compensation due to Employee hereunder
any and all sums required for social security and withholding taxes and for any
other federal, state, or local tax or charge which may be in effect or
hereafter enacted or required as a charge on the compensation of Employee.

3.5           During
the period that Employee is employed hereunder, Employer shall pay to Employee
an automobile allowance in the annualized amount of $6,000 to be paid in
bi-weekly increments (prorated for any partial month during the employment
period).

3.6           Employer
shall maintain Directors and Officers insurance, and such coverage shall be
substantially similar to coverage provided by Employer’s affiliates and related
entities.

4.             Non-Competition.

 

4.1           At
all times during Employee’s employment hereunder, and, if Employee’s employment
is terminated pursuant to Section 2.2(f) or 2.2(g), during the 18
month period of time after such termination (the “Post-Termination Payment
Period”) and in consideration for any and all payments and benefits provided to
Employee pursuant to this Agreement, during the Post-Termination Payment
Period, Employee shall not, directly or indirectly, engage or participate in,
prepare or set up, assist or have any interest in any person, partnership,
corporation, limited liability company, firm, association, or other business
organization, entity or enterprise (whether as an employee, officer, director,
member, agent, security holder, creditor, consultant or otherwise) that engages
in any activity in those geographic areas where Employer conducts the Business,
which activity is the same as, similar to, or competitive with any activity
engaged in by Employer (wholesale or retail lending operation for commercial or
multifamily loans of $250,000 up to $5,000,000 or such other business as
Employer may engage in). Notwithstanding the foregoing, Employee may elect at
any point during the Post-Termination Payment Period to forego any future
remaining payments or benefits payable under Section 2.4, in which case
the limitations set forth in this Section 4.1 shall terminate at the time
of such election.

4.2           Nothing
contained in Section 4.1 shall be deemed to preclude Employee from
purchasing or owning, directly or beneficially, as a passive investment, less
than five percent of any class of publicly traded securities of any entity so
long as Employee does not actively participate in or control, directly or
indirectly, any investment or other decisions with respect to such entity.

5.             No Compensation from Related Entities.

 

Without prior written
approval from Employer’s Board of Directors, Employee shall not directly or
indirectly receive compensation from any company with whom Employer or any of
its affiliates (as “affiliate” is defined in Rule 405 promulgated under
the Securities Act of 1933) has any financial, business or affiliated
relationship.

 9
 

 

6.             Confidentiality;
Non-Solicitation and Proprietary Rights.

Concurrently with signing
this Agreement, Employee and Employer will sign a Proprietary Rights and
Inventions Agreement in the form attached hereto as EXHIBIT C (the “Proprietary
Rights and Inventions Agreement”).

7.             Copies of Agreement.

Employee authorizes
Employer to send a copy of the Proprietary Rights and Inventions Agreement to
any and all future employers which Employee may have, and to any and all
persons, firms, and corporations, with whom Employee may become affiliated in a
business or commercial enterprise, and to inform any and all such employers,
persons, firms or corporations that Employer intends to exercise its legal
rights should Employee breach the terms of the Proprietary Rights and
Inventions Agreement or should another party induce a breach of that agreement on
Employee’s part.

8.             Severable Provisions.

The provisions of this
Agreement are severable and if any one or more provisions is determined to be
illegal or otherwise unenforceable, in whole or in part, the remaining
provisions, and any partially unenforceable provisions to the extent
enforceable, shall nevertheless be binding and enforceable.

9.             Arbitration.

To the fullest extent
allowed by law, any controversy, claim or dispute between Employee and Employer
(or any of its stockholders, directors, officers, employees, affiliates,
agents, successors or assigns) relating to or arising out of Employee’s
employment or the cessation of that employment will be submitted to final and
binding arbitration in Orange County, California for determination in
accordance with the American Arbitration Association’s (“AAA”) National Rules for
the Resolution of Employment Disputes, as the exclusive remedy for such
controversy, claim or dispute. In any such arbitration, the parties may conduct
discovery to the same extent as would be permitted in a court of law. The
arbitrator shall issue a written decision, and shall have full authority to
award all remedies which would be available in court. The arbitrator shall be
required to determine all issues in accordance with existing case law and the
statutory laws of the State of California. Employer shall pay the arbitrator’s
fees and any AAA administrative expenses. In the event Employee files a claim
to collect unpaid payments or benefits payable under Section 2.4, the
prevailing party shall be awarded reasonable attorneys fees and costs. Any
judgment upon the award rendered b, the arbitrator(s) may be entered in
any court having jurisdiction thereof. Possible disputes covered by the above
include unpaid wages, breach of contract, torts, violation of public policy,
discrimination, harassment, or any other employment-related claims under laws
including Title VII of the Civil Rights Act of 1964, the Americans With
Disabilities Act, the Age Discrimination in Employment Act, the California Fair
Employment and Housing Act, the California Labor Code, and any other federal or
state constitutional provisions, statutes or laws relating to an employee’s
relationship with his

 10

 

employer. However,
claims for workers’ compensation benefits and unemployment insurance (or any
other claims where mandatory arbitration is prohibited by law) are not covered
by this arbitration agreement, and such claims may be presented to the appropriate
court or government agency. BY AGREEING TO THIS MUTUAL AND BINDING ARBITRATION
PROVISION, BOTH EMPLOYEE AND EMPLOYER GIVE UP ALL RIGHTS TO TRIAL BY JURY. This
arbitration policy is to be construed as broadly as is permissible under
relevant law. EMPLOYER AND EMPLOYEE HAVE READ THIS SECTION 9 AND IRREVOCABLY
AGREE TO ARBITRATE ANY DISPUTE IDENTIFIED ABOVE.

	
  

  	
  /s/ RJJ

  	
   

  	
  /s/ WDE

  
	
   

  	
  Employer’s Initials

  	
   

  	
  Employee’s Initials

  

 

10.          Injunctive Relief.

The parties hereto agree
that any breach or threatened breach of Section 4 of this Agreement or the
Proprietary Rights and Inventions Agreement will cause substantial and
irreparable damage to Employer in an amount and of a character difficult to
ascertain. Accordingly, to prevent any such breach or threatened breach, and in
addition to any other relief to which Employer may otherwise be entitled,
Employer will be entitled to immediate temporary, preliminary and permanent
injunctive relief through appropriate legal proceedings in any arbitration, without
proof of actual damages that have been incurred or may be incurred by Employer
with respect to such breach or threatened breach. Employee expressly agrees
that Employer will not be required to post any bond or other security as a
condition to obtaining any injunctive relief pursuant to this Section 10, and
Employee expressly waives any right to the contrary. Employee agrees that this
Section 10 is without prejudice to the rights of the parties to compel
arbitration pursuant to Section 9.

11.          Entire Agreement.

This Agreement and the
Exhibits attached hereto contain the entire agreement of the parties relating
to the subject matter hereof, and the parties hereto have made no agreements,
representations or warranties relating to the subject matter of this Agreement
that are not set forth otherwise herein or the Exhibits attached hereto. This
Agreement supersedes any and all prior agreements, written or oral, with
Employer relating to Employees employment with Employer and any other subject
matter of this Agreement. Any such prior agreements are hereby terminated and
of no further effect and Employee, by the execution hereof, agrees that any
compensation provided for under any such prior agreement is specifically
superseded and replaced by the provision of this Agreement; subject to the
following: (i) any and all compensation previously deferred under any
pre-existing deferred compensation plan shall immediately be paid to Employee
without condition or limitation; and (ii) this Agreement is not intended to supercede,
cancel or replace any stock option or dividend equivalent right payments that
Employee may have or otherwise be entitled to receive. The parties hereto agree
that in no event shall an oral modification of this Agreement be enforceable or
valid.

 11
 

 

12.          Governing Law.

This Agreement is and
shall be governed and construed in accordance with the laws of the State of
California, regardless of any laws on choice of law or conflicts of law of any
jurisdiction.

13.          Notice.

All notices hereunder
must be in writing and shall be sufficiently given for all purposes hereunder
if properly addressed and delivered personally by documented overnight delivery
service, by certified or registered mail, return receipt requested, or by
facsimile or other electronic transmission service at the address or facsimile
number, as the case may be, set forth below. Any notice given personally or by
documented overnight delivery service is effective upon receipt. Any notice
given by registered mail is effective upon receipt, to the extent such receipt
is confirmed by return receipt. Any notice given by facsimile transmission is
effective upon receipt, to the extent that receipt is confirmed, either
verbally or in writing by the recipient. Any notice which is refused, unclaimed
or undeliverable because of an act or omission of the party to be notified, if
such notice was correctly addressed to the party to be notified, shall be
deemed communicated as of the first date that said notice was refused,
unclaimed or deemed undeliverable by the postal authorities, or overnight
delivery service.

	
  

  	
  If to Employer:

  	
  Impac Commercial Capital Corporation

  	
   

  	
   

  
	
   

  	
   

  	
  1401 Dove Street

  	
   

  	
   

  
	
   

  	
   

  	
  Newport Beach, California 92660

  	
   

  	
   

  
	
   

  	
   

  	
  Telephone: (949) 475-3600

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile: (949) 475-3969

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Ronald Morrison, Esq., General Counsel

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With a copy to:

  	
  Ernest W. Klatte, III, Esq.

  	
   

  	
   

  
	
   

  	
   

  	
  Rutan & Tucker, L.L.P.

  	
   

  	
   

  
	
   

  	
   

  	
  611 Anton Blvd., 14th Floor

  	
   

  	
   

  
	
   

  	
   

  	
  Costa Mesa, California 92626

  	
   

  	
   

  
	
   

  	
   

  	
  Telephone: (714) 641-5100

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile: (714) 546-9035

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  If to Employee:

  	
  William D. Endresen

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  With a copy to:

  	
  Richard K Zepfel, Esq.

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Payne & Fears, LLP

  	
   

  	
   

  
	
   

  	
   

  	
  4 Park Plaza Ste 1100

  	
   

  	
   

  
	
   

  	
   

  	
  Irvine, CA 92614

  	
   

  	
   

  
	
   

  	
   

  	
  Telephone: (949) 851-1100

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile: (949) 851-1212

  	
   

  	
   

  

 

 12
 

 

14.          Amendments And Waivers.

This Agreement may not be
amended, modified, superseded, canceled, or any terms waived, except by written
instrument signed by both parties, or in the case of waiver, by the party to be
charged.

15.          Successor and Assigns.

This Agreement is not
assignable by Employee, nor by Employer except to an affiliated or successor
entity. This Agreement is binding on the parties’ heirs, executors,
administrators, other legal representatives, successors, and, to the extent
assignable, their assigns.

16.          Representations.

The person executing this
Agreement on behalf of Employer hereby represents and warrants on behalf of
himself and Employer that he is authorized to represent and bind Employer.  Employee specifically represents and warrants
to Employer that he is not now under any contractual or quasi-contractual
obligations that is inconsistent or in conflict with this Agreement or that
would prevent, limit or impair Employee’s performance of his obligations under
this Agreement, (b) he has had the opportunity to be represented by legal
counsel of his choosing in preparing, negotiating, executing and delivering
this Agreement; and (c) fully understands the terms and provisions of this
Agreement.

17.          Counterparts; Facsimile Signatures.

This Agreement may be
executed in any number of counterparts, each of which shall be deemed an
original for all purposes. This Agreement may be executed by a party’s
signature transmitted by facsimile (“fax”), and copies of this Agreement
executed and delivered by means of faxed signatures shall have the same force
and effect as copies hereof executed and delivered with original signatures.
All parties hereto may rely upon faxed signatures as if such signatures were
originals. Any party executing and delivering this Agreement by fax shall
promptly thereafter deliver a counterpart signature page of this Agreement
containing said party’s original signature. All parties hereto agree that a
faxed signature page may be introduced into evidence in any proceeding arising
out of or related to this Agreement as if it were an original signature page.

18.          Rules of Construction.

This Agreement has been
negotiated by the parties and is to be interpreted according to its fair
meaning as if the parties had prepared it together and not strictly for or
against any party. References in this Agreement to “Sections” refer to Sections
of this Agreement, unless the context expressly indicates otherwise. References
to “provisions” of this Agreement refer to the terms, conditions, restrictions
and promises contained in this Agreement. References in this Agreement to laws
and regulations refer to such laws and regulations as in effect on this date
and to the corresponding provisions, if any, of any successor law or
regulation. At each place in this Agreement where the context so requires, the
masculine, feminine or neuter gender includes the others and the singular or
plural number includes the other. Forms of the verb “including” mean “including
without limitation” unless the context expressly indicates otherwise. “Or” is
inclusive and includes “and” unless the context expressly indicates otherwise.
The introductory headings at the beginning of Sections of this Agreement are
solely for the convenience of the parties and do not affect any provision of
this Agreement.

 13
 

 

IN WITNESS WHEREOF, this
Agreement is executed as of the day and year first above written.

	
  

  	
   

  	
  “EMPLOYER”

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  IMPAC COMMERCIAL CAPITAL

  CORPORATION, a California corporation

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By: 

  	
  /s/ Richard J. Johnson

  	
   

  
	
   

  	
   

  	
  Name: 

  	
  Richard J. Johnson

  	
   

  
	
   

  	
   

  	
  Title: 

  	
  EVP, CFO

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  “EMPLOYEE”

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/ William D. Endresen

  
	
   

  	
   

  	
  WILLIAM D. ENDRESEN

  
									

 

 14

 

EXHIBIT A

JOB DESCRIPTION AND
RELATED ENTITIES

President, Impac Commercial Capital
Corporation

Oversee
the day to day operations of the Organization in support of policies, goals and
objectives established by the Board of Directors of Employer, and the President,
COO and CEO of Impac Mortgage Holdings, Inc. For purposes of this Exhibit A,
“Organization” means Employer and any affiliates or related entities of
Employer for whom Employee is requested to provide services pursuant to the
Employment Agreement by and between Employer and Employee dated as of January
31, 2006 (the “Agreement”).

Provide vision for the Organization and assume
responsibility for its development, growth and success. Participate in the oversight, management and
administration of Employer, either directly or through supervision of senior
managers.

Manage
and supervise senior management and staff members that report to the President.

Major Responsibilities
include:

·                   Regularly
report to the President, COO and CEO of Impac Mortgage Holdings, Inc. and
the Employer’s Board of Directors on the status of Employer in achieving it’s
business plan and goals; 

·                   Responsible for
reviewing Underwriting Guidelines, Policy and Procedures and Quality Control
Guidelines;

·                   Responsible for
developing and maintaining relationships with approved broker/correspondents; 

·                   Assuring the
profitable operation through production, pricing and meeting securitization
requirements; 

·                   Decision making
and providing direction as required; and 

·                   Member of
Employer’s Executive Committee.

Specific
Tasks include:

·                   Provide monthly
reports to the President, CFO and CEO of Impac Mortgage Holdings, Inc. and
to the Board of Directors of Employer;

·                   Provide final
approval of all Employer’s loan requests; 

·                   Direct regular
Management meetings;

·                   Coordinate and
communicate corporate objectives;

 A-1
 

 

·                   Oversee Quality
Control Department; and

·                   Approve new
loan products and pricing strategies. 

Employee acknowledges,
understands and agrees that Employee will be requested by Employer to devote
some or all of Employee’s time and effort during the term of employment
pursuant to the Agreement (and consistent with the above job descriptions) to
the businesses of Employer’s affiliates or related entities pursuant to certain
agreements between and among Employer and such affiliates or related entities.
Such affiliates and related entities include, but are not limited to, the
following: Impac Mortgage Holdings, Inc., Impac Funding Corporation.,
Impac Warehouse Lending Group, IMH Assets Corp., Novelle Financial
Services, Inc., Impac Lending Group, Impac Secured Assets Corp., Impac
Mortgage Acceptance Corp., and Impac Foundation.

Employee further
understands and acknowledges that, pursuant to the Agreement, Employee may be
directed by Employer to provide services consistent with the above job
descriptions to additional real estate investment trusts or other entities
which Employer establishes or with which Employer affiliates or becomes related
and for which there exists an agreement with Employer or any of the above
entities to provide such services.

Employee understands and
acknowledges that Employee’s obligations under the Agreement, including
Employee’s duties under Section 4 thereof and the Proprietary Rights and
Inventions Agreement entered into pursuant to Section 6 thereof, shall
apply and extend to Employee’s knowledge of the business of Employer’s
affiliates or related entities and any trade secret or other confidential or
proprietary information relating to same.

 A-2

 

EXHIBIT B

WAIVER AND RELEASE
AGREEMENT

For full and valuable
consideration, including, but not limited to, severance payments made and to be
made by Impac Commercial Capital Corporation and any affiliate or related
entity of Impac Commercial Capital Corporation (collectively, “Employer”) to
William D. Endresen (“Employee”) pursuant to the Employment Agreement between
Employer and Employee dated as of January 1, 2006 (the “Employment
Agreement”), Employee, on the one part, and Employer and Guarantor on the other
part, hereby enter into this Waiver and Release Agreement (“Waiver”), and each
agrees to waive and release the other and, as the case may be, the other’s
stockholders, directors, officers, employees, affiliates, agents, successors
and assigns, if any, from all known and unknown claims, agreements or
complaints related to or arising under Employee’s employment with Employer,
including, but not limited to, any claim arising out of Employee’s termination,
any express or implied agreement between Employee and Employer (other than each
party’s respective rights and obligations under Sections 2.3, 2.4 and 4.1 of
the Employment Agreement, and the Proprietary Rights and Inventions Agreement),
and any other federal or state constitutional provisions, statutes or laws
relating to an employee’s relationship with his employer, including, but not
limited to, Title VII of the Civil Rights Act of 1964, the Employee Retirement
Income Security Act, the Age Discrimination in Employment Act, the Americans
With Disabilities Act, the California Fair Employment and Housing Act, and the
California Labor Code.

This Waiver shall not
include a waiver of any of the following: (i) any right to defense and/or
indemnification that Employee may have under California Labor Code section 2802,
or under any defense and indemnification policy or agreement; (ii) any
claim for breach of any pension, 401k or stock option plan of Employer; or
(iii) any claim that Employee may have against any officer, director,
employee, or agent of Employer or Guarantor for defamation or intentional
interference with prospective employment or business advantage.

This Waiver includes a
waiver of any rights the parties may have under Section 1542 of the
California Civil Code, which states:

“A general release does not extend to claims which the
creditor does not know or suspect to exist in his favor at the time of
executing the release, which if known by him must have materially affected his
settlement with the debtor.”

Employee’s Waiver is
conditioned upon Employer and Guarantor’s performance of all of their severance
obligations pursuant to Sections 2.3 and 2.4 of the Employment Agreement. In
the event that Employer materially breaches its severance obligations under the
Employment Agreement, then Employee shall be entitled to pursue any claims as
though this Waiver did not exist, and the statute of limitations for any such
claims shall be deemed to have been tolled during the period from the date of
Employee’s termination through the date Employer breached it obligations.

Employer and Guarantor’s
Waiver is conditioned upon Employee’s performance of all of his obligations
pursuant to Section 4.1 of the Employment Agreement. In the event that

 B-1
 

 

Employee
materially breaches his noncompete obligations under the Employment Agreement,
then Employer shall be entitled to pursue any claims as though this Waiver did
not exist, and the statute of limitations for any such claims shall be deemed
to have been tolled during the period from the date of Employee’s termination
through the date Employee breached his obligations. The parties to this Waiver
each acknowledge that each may hereafter discover facts different from or in
addition to those now known or believed to be true with respect to the claims,
suits, rights, actions, complaints, agreements, contracts, causes of action,
and liabilities of any nature whatsoever that are the subject of the above
release, and the parties expressly agree that this Waiver shall be and remain
effective in all respects regardless of such additional or different facts.

Employee is advised as
follows: (i) Employee should consult an attorney regarding this Waiver
before executing it; (ii) Employee has 21 days in which to consider this
Waiver and whether Employee will enter into it; (iii) this Waiver does not
waive rights or claims that may arise after it is executed; and (iv) at
anytime within seven days after executing this Waiver, Employee may revoke this
Waiver. This Waiver shall not become effective or enforceable until the seven
day revocation period set forth herein has passed.

Capitalized terms not
otherwise defined herein shall have the meanings set forth in the Employment
Agreement.

	
  Dated:

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  WILLIAM D. ENDRESEN

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  IMPAC COMMERCIAL CAPITAL

  CORPORATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Print Name:
  Richard J. Johnson

  
	
   

  	
   

  	
  Title: EVP, CFO

  	
   

  
						

 

 B-2

 

EXHIBIT C

PROPRIETARY RIGHTS AND
INVENTIONS AGREEMENT

In consideration of my
employment by Impac Commercial Capital Corporation, a California corporation
(the “Company”), and the compensation I receive from the Company, I agree to
certain restrictions placed by the Company on my use and development of
information and technology, as more fully set out below.

1.             Proprietary
Information. I understand that the Company possesses and will possess
Proprietary Information which is important to its business. For purposes of
this Agreement, “Proprietary Information” is information that was or will be
developed, created, or discovered by or on behalf of the Company or any of its
affiliates or related entities, or which became or will become known by, or was
or is conveyed to the Company, which has commercial value in the Company’s
business or the business of any of the Company’s affiliates or related
entities, unless (i) the information is or becomes publicly known through
lawful means; (ii) the information was rightfully in my possession or part
of my general knowledge prior to my employment by the Company as specifically
identified and disclosed by me in Exhibit A attached hereto; or
(iii) the information is disclosed to me without confidential or proprietary
restriction by a third party who rightfully possesses the information (without
confidential or proprietary restriction) and who did not learn of it directly
from the Company or any of its affiliates or related entities.

Proprietary Information
includes information (whether conveyed orally or in writing) relating to
(i) client/customer lists, vendor lists or other lists or compilations
containing client, customer or vendor information; (ii) information about
investment techniques or strategies, investment research or analysis, business
techniques or strategies, processes, costs, profits, markets, marketing plans,
forecasts, sales or commissions; (iii) plans for new investment techniques
and strategies; (iv) the compensation, performance and terms of employment
of other employees; (v) all other information that has been or will be
given to me in confidence by the Company (or any affiliate or related entity of
the Company); (vi) software in various stages of development, and any
designs, drawings, schematics, specifications, techniques, models, data, source
code, algorithms, object code, documentation, diagrams, flow charts, research
development, processes and procedures relating to any software; (vii) any
documents, books, papers, drawings, schematics, models, sketches, computer
programs, databases or other data, including electronic data recorded or
retrieved by any means, that contain any Proprietary Information; and
(viii) any information described above which the Company or any of its
affiliates or related entities obtains from another party and which the Company
or any of its affiliates or related entities treats as proprietary or
designates as Proprietary Information.

2.             Company
Materials. I understand that the Company and its affiliates and related
entities possess or will possess “Company Materials” which are important to
their respective businesses. For purposes of this Agreement, “Company
Materials” are documents or other media or tangible items that contain or
embody Proprietary Information or any other information concerning the
business, operations or plans of the Company or any of its affiliates or
related entities, whether such documents have been prepared by me or by others.
“Company Materials” include charts, graphs, notebooks, customer lists, computer
software, media or printouts, sound recordings and other printed, typewritten
or handwritten documents, as well as financial models and the like.

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3.             Intellectual
Property.

3.1           All
Proprietary Information and all right, title and interest in and to any
patents, patent rights, copyrights, trademark rights, mask work rights, trade
secret rights, and all other intellectual and industrial property and
proprietary rights that currently exist or may exist in the future anywhere in
the world (collectively “Rights”) in connection therewith shall be the sole
property of the Company or its affiliates or related entities, as the case may
be. I hereby assign to the Company any Rights I may have or acquire in such
Proprietary Information. At all times, both during my employment with the
Company and after its termination, I will keep in confidence and trust and will
not use or disclose any Proprietary Information or anything relating to it
without the prior written consent of an officer of the Company except as may be
necessary and appropriate in the ordinary course of performing my duties to the
Company. The disclosure restrictions of this Agreement shall not apply to any
information that I can document is generally known to the public through no
fault of mine. Nothing contained herein will prohibit me from disclosing to
anyone the amount my wages.

3.2           All
Company Materials shall be the sole property of the Company. I agree that
during my employment with the Company, I will not remove any Company Materials
from the business premises of the Company or deliver any Company Materials to
any person or entity outside the Company, except as I am required to do in
connection with performing the duties of my employment. I further agree that,
immediately upon the termination of my employment by me or by the Company for
any reason, or for no reason, or during my employment if so requested by the
Company, I will return all Company Materials, apparatus, equipment and other
physical property, and any reproduction of such property, excepting only
(i) my personal copies of records relating to my compensation and
(ii) my copy of this Agreement.

3.3           I agree
that all “Inventions” (which term includes patentable or nonpatentable
inventions, original works of authorship, derivative works, trade secrets,
trademarks, copyrights, service marks, discoveries, patents, technology,
algorithms, computer software, application programming interfaces, protocols,
formulas, compositions, ideas, designs, processes, techniques, know-how, data
and all improvements, rights and claims related to the foregoing), which I
make, conceive, reduce to practice or develop (in whole or in part, either
alone or jointly with others) during my employment, shall be the sole property
of the Company to the maximum extent permitted by Section 2870 of the
California Labor Code. I hereby assign, without further consideration, all such
Inventions to the Company (free and clear of all liens and encumbrances), and
the Company shall be the sole owner of all Rights in connection therewith. No
assignment in this Agreement shall extend to Inventions, the assignment of
which is prohibited by Labor Code Section 2870, which states:

Any provision in an employment agreement which
provides that an employee shall assign, or offer to assign, any of his or her
rights in an invention to his or her employer shall not apply to an invention
that the employee developed entirely on his or her own time without using the
employer’s equipment, supplies, facilities, or trade secret information except
for those inventions that either:

 C-2
 

 

1.                                       Relate
at the time of conception or reduction to practice of the invention to the
employer’s business, or actual or demonstrably anticipated research or
development of the employer.

2.                                       Result
from any work performed by the employee for the employer.

I acknowledge that all
original works of authorship which are made by me (in whole or in part, either
alone or jointly with others) within the scope of my employment and which are
protectable by copyright are “works made for hire,” as defined in the United
States Copyright Act (17 USCA, Section 101). 1 will not disclose
Inventions covered by this Section 3.3 to any person outside the Company,
unless I am requested to do so by management personnel of the Company.

3.4           I agree to
disclose promptly to the Company all Inventions and relevant records, which
records will remain the sole property of the Company. I further agree that all
information and records pertaining to any idea, process, trademark, service
mark, invention, technology, computer program, original work or authorship,
design, formula, discovery, patent, or copyright that I do not believe to be an
Invention, but is conceived, developed, or reduced to practice by me (in whole
or in part, either alone or jointly with others) during my employment, shall be
promptly disclosed to the Company (such disclosure to be received in
confidence). I will also disclose to the Company all Inventions conceived,
reduced to practice, used, sold, exploited or developed by me (in whole or in
part, either alone or jointly with others) within one (1) year of the
termination of my employment with the Company (“Presumed Inventions”); such
disclosures shall be received by the Company in confidence, to the extent they
are not assigned to the Company in Section 3.3, and do not extend such
assignment. Because of the difficulty of establishing when any Presumed
Invention is first conceived or developed by me, or whether it results from
access to Proprietary Information or the Company’s equipment, facilities, and
data, I agree that all Presumed Inventions and all Rights associated therewith
shall be presumed to be Inventions subject to assignment under
Section 3.3. I can rebut this presumption if I prove that a Presumed
Invention is not an Invention subject to assignment under Section 3.3.

3.5           I agree to
perform, during and after my employment, all acts deemed necessary or desirable
by the Company to permit and assist it, at the Company’s expense, in
evidencing, perfecting, obtaining, maintaining, defending and enforcing Rights
or my assignment with respect to such Inventions in any and all countries.
Should the Company be unable to secure my signature on any document necessary
to apply for, prosecute, obtain, enforce or defend any Rights relating to any
assigned Invention, whether due to my mental or physical incapacity or any
other cause, I hereby irrevocably designate and appoint the Company and its
duly authorized officers and agents, as my agents and attorneys-in-fact, with
full power of substitution, to act for and in my behalf and instead of me, to
execute and file any documents and to do all other lawfully permitted acts to
further the above purposes with the same legal force and effect as if executed
by me.

3.6           Any
assignment of copyright hereunder (and any ownership of a copyright as a work
made for hire) includes all rights of paternity, integrity, disclosure and
withdrawal and any other rights that may be known as or referred to as “moral
rights” (collectively “Moral Rights”). To the extent such Moral Rights cannot
be assigned under applicable law and to the

 C-3
 

 

extent the following is
allowed by the laws in the various countries where Moral Rights exist, I hereby
waive such Moral Rights and consent to any action of the Company that would
violate such Moral Rights in the absence of such waiver and consent. I will
confirm any such waivers and consents from time to time as requested by the
Company.

3.7           Attached
hereto as Exhibit A is a complete list of all existing Inventions to which
I claim personal ownership of as of the date of this Agreement and that I
desire to specifically clarify are not subject to this Agreement, and I
acknowledge and agree that such list is complete. If no such list is attached
to this Agreement, I represent that I have no such Inventions at the time of
signing this Agreement.

3.8           I
understand that nothing in this Agreement is intended to expand the scope of
protection provided me by Sections 2870 through 2872 of the California Labor
Code.

4.             Prior
Actions and Knowledge. I represent and warrant that from the time of my
first contact or communication with the Company, I have held in strict
confidence all Proprietary Information and have not (i) disclosed any
Proprietary Information or delivered any Company Materials to anyone outside of
the Company or any affiliate or related entity of the Company, or
(ii) used, copied, published, or summarized any Proprietary Information or
removed any Company Materials from the business premises of the Company, except
to the extent necessary to carry out my responsibilities as an employee of the
Company.

5.             Non-Solicitation
of Employees. I agree that for a period of eighteen months following the
termination of my employment with the Company, I will not, on behalf of myself
or any other person or entity, solicit the services of any person who was
employed by the Company or any affiliate or related entity of the Company on
the date of my termination of employment or at any time during the six month
period prior to the termination of my employment.

6.             No
Conflict with Obligations to Third Parties. I represent that my performance
of all the terms of this Agreement will not breach any agreement to keep in
confidence proprietary or confidential information acquired by me in confidence
or in trust prior to my employment with the Company. I have not entered into,
and I agree I will not enter into, any agreement either written or oral in
conflict herewith or in conflict with my employment with the Company.

7.             Remedies.
I recognize that nothing in this Agreement is intended to limit any remedy of
the Company under the California Uniform Trade Secrets Act. I recognize that my
violation of this Agreement could cause the Company irreparable harm, the
amount of which may be extremely difficult to estimate, making any remedy at law
or in damages inadequate. Therefore, I agree that the Company shall have the
right to apply to any court of competent jurisdiction for an order restraining
any breach or threatened breach of this Agreement and for any other relief the
Company deems appropriate. This right shall be in addition to any other remedy
available to the Company.

8.             Survival.
I agree that my obligations under Sections 3.1 through 3.6, 5 and 6 shall
continue in effect after termination of my employment, regardless of the reason
or reasons for termination, and whether such termination is voluntary or
involuntary on my part, and that the Company is entitled to communicate my
obligations under this Agreement to any future employer or potential employer
of mine.

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9.             Controlling
Law. This Agreement is and shall be governed and construed in accordance
with the laws of the State of California, regardless of any laws on choice of
law or conflicts of law of any jurisdiction.

10.           Severable
Provisions. The provisions of this Agreement are severable and if any one
or more provisions is determined to be illegal or otherwise unenforceable, in
whole or in part, the remaining provisions, and any partially unenforceable
provisions to the extent enforceable, shall nevertheless be binding and
enforceable.

11.           Successors
and Assigns. This Agreement shall be effective as of the date I execute
this Agreement and shall be binding upon me, my heirs, executors, assigns, and
administrators and shall inure to the benefit of the Company, its subsidiaries,
successors and assigns.

12.           Counterparts;
Facsimile Signatures. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original for all purposes. This
Agreement may be executed by a party’s signature transmitted by facsimile (“fax”),
and copies of this Agreement executed and delivered by means of faxed
signatures shall have the same force and effect as copies hereof executed and
delivered with original signatures. All parties hereto may rely upon faxed
signatures as if such signatures were originals. Any party executing and
delivering this Agreement by fax shall promptly thereafter deliver a
counterpart signature page of this Agreement containing said party’s
original signature. All parties hereto agree that a faxed signature page may
be introduced into evidence in any proceeding arising out of or related to this
Agreement as if it were an original signature page.

13.           Rules of
Construction. This Agreement has been negotiated by the parties and is to
be interpreted according to its fair meaning as if the parties had prepared it
together and not strictly for or against any party. References in this
Agreement to “Sections” refer to Sections of this Agreement, unless the context
expressly indicates otherwise. References to “provisions” of this Agreement
refer to the terms, conditions, restrictions and promises contained in this
Agreement. References in this Agreement to laws and regulations refer to such
laws and regulations as in effect on this date and to the corresponding provisions,
if any, of any successor law or regulation. At each place in this Agreement
where the context so requires, the masculine, feminine or neuter gender
includes the others and the singular or plural number includes the other. Forms
of the verb “including” mean “including without limitation” unless the context
expressly indicates otherwise. “Or” is inclusive and includes “and” unless the
context expressly indicates otherwise. The introductory headings at the
beginning of Sections of this Agreement are solely for the convenience of the
parties and do not affect any provision of this Agreement.

14.           Amendments
and Waivers. This Agreement may not be amended, modified, superseded,
canceled, or any terms waived, except by written instrument signed by both
parties, or in the case of waiver, by the party to be charged.

 C-5
 

 

I HAVE READ THIS
AGREEMENT CAREFULLY AND I UNDERSTAND AND ACCEPT THE OBLIGATIONS WHICH IT
IMPOSES UPON ME WITHOUT RESERVATION. NO PROMISES OR REPRESENTATIONS HAVE BEEN
MADE TO ME TO INDUCE ME TO SIGN THIS AGREEMENT OTHER THAN THE PROMISES AND
REPRESENTATIONS EXPRESSLY STATED IN THIS AGREEMENT AND IN THE EMPLOYMENT
AGREEMENT ENTERED INTO BETWEEN ME AND THE COMPANY CONCURRENTLY HEREWITH. I HAVE
COMPLETELY NOTED ON EXHIBIT A TO THIS AGREEMENT ANY PROPRIETARY INFORMATION AND
INVENTIONS THAT I DESIRE TO EXCLUDE FROM THIS AGREEMENT.

	
  Dated as of: January 1,
  2006

  	
   

  
	
   

  	
  WILLIAM D.
  ENDRESEN

  
	
   

  
	
  Accepted and
  Agreed to:

  
	
   

  
	
  IMPAC COMMERCIAL
  CAPITAL

  CORPORATION, a California corporation

  
	
   

  
	
  By:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Name:

  	
  Richard J.
  Johnson

  	
   

  	
   

  
	
   

  
	
  Title:

  	
  EVP, CFO

  	
   

  	
   

  
									

 

 C-6

 

EXHIBIT D

EMPLOYEE’S DISCLOSURE

Gentlemen:

1.             Except
for the information and ideas listed below that rightfully became part of my
general knowledge prior to my first contact or communication with the Company
or any of its affiliates or related entities, I represent that I am not in the
possession of and have no knowledge of any information that can be considered
the Proprietary Information of Impac Commercial Capital Corporation, a
California corporation (the “Company”), other than information disclosed by Company
or any of its affiliates or related entities during my employment negotiations
or my prior employment with the Company or any of its affiliates or related
entities, which I understand and agree is the Proprietary Information of
Company or its affiliates or related entities, as the case may be.

	
   

  
	
   

  

 

2.             Except
for the complete list of Inventions set forth below, I represent that I (in
whole or in part, either alone or jointly with others) have not made,
conceived, developed or first reduced to practice any Inventions relevant to
the subject matter of my employment with the Company prior to my employment
with the Company or any of its affiliates or related entities.

	
  

  	
   

  	
  No Inventions

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  See below:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Additional
  sheets attached

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  WILLIAM D.
  ENDRESEN

  
					

 

 D-1Exhibit
10.4

IMPAC MORTGAGE HOLDINGS, INC.

GUARANTY

This Guaranty, dated as of May 1, 2006, is
executed by Impac Mortgage Holdings, Inc., a Maryland corporation (“Guarantor”),
in favor of William D. Endresen (“Executive”).

A.            Impac Commercial Capital Corporation,
a California corporation (“Obligor”), concurrently herewith has entered
into an Employment Agreement with Obligor dated even date herewith (the “Contract”).
Guarantor is the parent corporation of Obligor and will receive direct and
indirect benefits from the performance of the Contract.

B.            Executive’s willingness to enter into the Contract is
subject to receipt by it of this Guaranty duly executed by Guarantor.

For good and valuable consideration, the receipt and
adequacy of which are hereby acknowledged, and intending to be legally bound,
Guarantor hereby agrees with Executive as follows:

1.            Guaranty.

(a)           Guarantor unconditionally guarantees
and promises to pay to Executive, or order, at Executive’s address set forth in
Section 4(a) hereof, on demand after the default by Obligor, in
lawful money of the United States, any and all Obligations (as hereinafter
defined) consisting of payments due to Executive. For purposes of this Guaranty
the term “Obligations” shall mean and include all payments owed by
Obligor to Executive of every kind and description, direct or indirect,
absolute or contingent, due or to become due, now existing or hereafter arising
pursuant to the terms of Section 2.3, 2.4, 3.1(a), 3.1(b), 3.1(c), or 3.2
of the Contract (as such Obligations may become due subject to the provisions
of the Contract, including all notice requirements and cure provisions),
including all interest, late fees, charges, expenses, attorneys’ fees and other
professionals’ fees chargeable to Obligor or payable by Obligor there under and
any costs of collection hereunder, including attorneys’ and other professionals’
fees.

(b)           This Guaranty is absolute,
unconditional, continuing and irrevocable and constitutes an independent
guaranty of payment and not of collect ability (provided that it is subject to
Obligor defaulting on any of the Obligations), and is in no way conditioned on
or contingent upon any attempt to enforce in whole or in part any of Obligor’s
Obligations to Executive, the existence or continuance of Obligor as a legal
entity, the consolidation or merger of Obligor with or into any other entity,
the sale, lease or disposition by Obligor of all or substantially all of its
assets to any other entity, or the bankruptcy or insolvency of Obligor, the
admission by Obligor of its inability to pay its debts as they mature, or the
making by Obligor of a general assignment for the benefit of, or entering into
a composition or arrangement with, creditors. If Obligor or any permitted
assignee or successor of Obligor shall fail to pay or

 

perform any Obligations
to Executive which are subject to this Guaranty as and when they are due,
Guarantor shall forthwith pay to Executive all such liabilities or obligations
in immediately available funds. Each failure by Obligor to pay or perform any
such liabilities or obligations shall give rise to a separate cause of action,
and separate suits may be brought hereunder as each cause of action arises.

(c)           Executive, may (subject to the
provisions of the Contract) at any time and from time to time, without the
consent of or notice to Guarantor, except such notice as may be required by
applicable statute which cannot be waived, without incurring responsibility to
Guarantor, and without impairing or releasing the obligations of Guarantor
hereunder, (i) change the manner, place and terms of payment or change or
extend the time of payment of, renew, or alter any Obligation hereby
guaranteed, or in any manner modify, amend or supplement the terms of the
Contract or any documents, instruments or agreements executed in connection
therewith, (ii) exercise or refrain from exercising any rights against
Obligor or others (including Guarantor) or otherwise act or refrain from
acting, (iii) settle or compromise any Obligations hereby guaranteed and/or
any obligations and liabilities (including any of those hereunder) incurred
directly or indirectly in respect thereof or hereof, and may subordinate the
payment of all or any part thereof to the payment of any obligations and
liabilities which may be due to Executive or others, (iv) sell, exchange,
release, surrender, realize upon or otherwise deal with in any manner or in any
order any property pledged or mortgaged by anyone to secure or in any manner
securing the Obligations hereby guaranteed, (v) take and hold security or
additional security for any or all of the obligations or liabilities covered by
this Guaranty, and (vi) assign its rights and interests under this
Guaranty, in whole or in part.

(d)            This is a continuing Guaranty for
which Guarantor receives continuing consideration and all obligations to which
it applies or may apply under the terms hereof shall be conclusively presumed
to have been created in reliance hereon and this Guaranty is therefore
irrevocable without the prior written consent of Executive.

(e)             Guarantor may bring action to
enforce Executive’s obligations under the Contract if (i) any proceeding
is brought against Guarantor to seek enforcement of this Guaranty or (ii) Guarantor
makes any payment to Executive pursuant to this Guaranty.

2.            Representations and Warranties.
Guarantor represents and warrants to Executive that (a) Guarantor is a
corporation duly organized, validly, existing and in good standing under the
laws of its jurisdiction of incorporation or formation; (b) the execution,
delivery and performance by Guarantor of this Guaranty are within the power of
Guarantor and have been duly authorized by all necessary actions on the part of
Guarantor; (c) this Guaranty has been duly executed and delivered by
Guarantor and constitutes a legal, valid and binding obligation of Guarantor,
enforceable against it in accordance with its terms, except as limited by
bankruptcy, insolvency or other laws of general application relating to or
affecting the enforcement of creditors’ rights generally.

 2
 

 

3.            Waivers.

(a)            Guarantor, to the extent permitted
under applicable law, hereby waives any right to require Executive to (i) proceed
against Obligor or any other guarantor of Obligor’s obligations under the
Contract, (ii) proceed against or exhaust any security received from
Obligor or any other guarantor of Obligor’s Obligations under the Contract, or (iii) pursue
any other right or remedy in the Executive’s power whatsoever.

(b) Guarantor further waives, to the extent
permitted by applicable law, (i) any defense resulting from the absence,
impairment or loss of any right of reimbursement, subrogation, contribution or
other right or remedy of Guarantor against Obligor, any other guarantor of the
Obligations or any security; (ii) any defense which results from any
disability of Obligor or the lack of validity or enforceability of the
Contract; (iii) any right to exoneration of sureties which would otherwise
be applicable; (iv) any right of subrogation or reimbursement and, if
there are any other guarantors of the Obligations, any right of contribution,
and right to enforce any remedy which Executive now has or may hereafter have
against Obligor, and any benefit of, and any right to participate in, any
security now or hereafter received by Executive; (v) all presentments,
demands for performance, notices of non-performance, notices delivered under
the Contract, protests, notice of dishonor, and notices of acceptance of this
Guaranty and of the existence, creation or incurring of new or additional Obligations
and notices of any public or private foreclosure sale; (vi) any
appraisement, valuation, stay, extension, moratorium redemption or similar law
or similar rights for marshalling; and (vii) any right to be informed by
Executive of the financial condition of Obligor or any other guarantor of the
Obligations or any change therein or any other circumstances bearing upon the
risk of nonpayment or nonperformance of the Obligations. Guarantor has the
ability to and assumes the responsibility for keeping informed of the financial
condition of Obligor and any other guarantors of the Obligations and of other
circumstances affecting such nonpayment and nonperformance risks.

4.            Miscellaneous.

(a)           Notices. All notices hereunder
must be in writing and shall be sufficiently given for all purposes hereunder
if properly addressed and delivered personally by documented overnight delivery
service, by certified or registered mail, return receipt requested, or by
facsimile or other electronic transmission service at the address or facsimile
number, as the case may be, set forth below. Any notice given personally or by
documented overnight delivery service is effective upon receipt. Any notice
given by registered mail is effective upon receipt, to the extent such receipt
is confirmed by return receipt. Any notice given by facsimile transmission is
effective upon receipt, to the extent that receipt is confirmed, either
verbally or in writing by the recipient. Any notice which is refused, unclaimed
or undeliverable because of an act or omission of the party to be notified, if
such notice was correctly addressed to the party to be notified, shall be
deemed communicated as of the first date that said notice was refused,
unclaimed or deemed undeliverable by the postal authorities, or overnight
delivery service.

 3
 

 

 

	
  Executive:

  	
   

  	
  Guarantor:

  
	
   

  	
   

  	
   

  
	
   

  	
  William D. Endresen

  	
   

  	
  Impac Mortgage Holdings, Inc.

  
	
   

  	
   

  	
   

  	
   

  	
  1401 Dove Street

  
	
   

  	
   

  	
   

  	
   

  	
  Newport Beach, California 92660

  
	
   

  	
   

  	
   

  	
  Telephone:(949)475-3600

  
	
   

  	
   

  	
   

  	
  Facsimile:(949) 475-3969

  
	
   

  	
   

  	
   

  	
  Attention: Ronald Morrison, Esq., General

  
	
   

  	
   

  	
   

  	
  Counsel

  
	
   

  	
   

  	
   

  
	
  With a copy to:

  	
   

  	
  With a copy to:

  
	
   

  	
   

  	
   

  
	
  Richard K Zepfel, Esq.

  	
   

  	
   

  	
  Ernest W. Klatte, III, Esq.

  
	
  Payne & Fears, LLP

  	
   

  	
   

  	
  Rutan & Tucker, LLP

  
	
  4 Park Plaza Ste 1100

  	
   

  	
   

  	
  611 Anton Blvd., 14th Floor

  
	
  Irvine, CA 92614

  	
   

  	
   

  	
  Costa Mesa, California 92626

  
	
  Telephone: (949) 851-1100

  	
   

  	
   

  	
  Telephone: (714) 641-5100

  
	
  Facsimile: (949) 851-1212

  	
   

  	
   

  	
  Facsimile: (714) 546-9035

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  And

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Patricio T.D. Barrera, ESQ.

  
	
   

  	
   

  	
  Marcin Barrera LLP

  
	
   

  	
   

  	
  1901 Avenue of the Stars

  
	
   

  	
   

  	
  Suite 1900

  
	
   

  	
   

  	
  Los Angeles, CA 90067

  
	
   

  	
   

  	
  Telephone: (310) 286-1050

  
	
   

  	
   

  	
  Facsimile: (310) 286-1070

  
							

 

(b)            Nonwaiver. No failure or
delay on Executive’s part in exercising any right hereunder shall operate as a
waiver thereof or of any other right nor shall any single or partial exercise
of any such right preclude any other further exercise thereof or of any other
right.

(c)            Amendments and Waivers. This
Guaranty may not be amended, modified, superseded, canceled, or any terms
waived, except by written instrument signed by both parties, or in the case of
waiver, by the party to be charged.

(d)            Assignments. This Guaranty
shall be binding upon and inure to the benefit of Executive and Guarantor and
their respective successors and assigns; provided,  however, that
without the prior written consent of Executive, Guarantor may not assign its
rights and obligations hereunder.

(e)            Cumulative Rights, etc. The
rights, powers and remedies of Executive under this Guaranty shall be in
addition to all rights, powers and remedies given to Executive by virtue of any
applicable law, rule or regulation, the Contract or any other agreement,
all of which rights, powers, and remedies shall be cumulative and may be
exercised successively or concurrently without impairing Executive’s rights hereunder.

 4
 

 

(f)             Partial Invalidity. The
provisions of this Guaranty are severable and if any one or more provisions is
determined to be illegal or otherwise unenforceable, in whole or in part, the
remaining provisions, and any partially unenforceable provisions to the extent
enforceable, shall nevertheless be binding and enforceable.

(g)            Governing Law. This Guaranty
is and shall be governed and construed in accordance with the laws of the State
of California, regardless of any laws on choice of law or conflicts of law of
any jurisdiction.

(h)            Arbitration. To the fullest
extent allowed by law, any controversy, claim or dispute between Executive and
Guarantor (or any of its stockholders, directors, officers, employees,
affiliates, agents, successors or assigns) relating to or arising out of this
Guaranty will be submitted to final and binding arbitration in Orange County,
California for determination in accordance with the American Arbitration
Association’s (“AAA”) National Rules for the Resolution of Employment
Disputes, as the exclusive remedy for such controversy, claim or dispute. In
any such arbitration, the parties may conduct discovery to the same extent as
would be permitted in a court of law. The arbitrator shall issue a written
decision, and shall have full authority to award all remedies which would be
available in court. The arbitrator shall be required to determine all issues in
accordance with existing case law and the statutory laws of the State of
California. Guarantor shall pay the arbitrator’s fees and any AAA
administrative expenses. In the event Executive files a claim to collect unpaid
payments or benefits payable under Section 2.4 of the Contract, the
prevailing party shall be awarded reasonable attorneys fees and costs. Any
judgment upon the award rendered by the arbitrator(s) may be entered in
any court having jurisdiction thereof. BY AGREEING TO THIS MUTUAL AND
BINDING ARBITRATION PROVISION, BOTH EXECUTIVE AND GUARANTOR GIVE UP ALL RIGHTS
TO TRIAL BY JURY. This arbitration policy is to be construed as broadly as is
permissible under relevant law. EXECUTIVE AND GUARANTOR HAVE READ THIS SECTION 4(h) AND
IRREVOCABLY AGREE TO ARBITRATE ANY DISPUTE IDENTIFIED ABOVE.

	
  

  	
  Executive’s
  Initials

  	
  /s/ WDE

  	
   

  	
  Guarantor’s Initials 

  	
  /s/ RJJ

  	
   

  

 

(i)            Entire Agreement. This
Guaranty contains the entire agreement of the parties relating to the subject
matter hereof, and the parties hereto have made no agreements, representations
or warranties relating to the subject matter of this Guaranty that are not set
forth otherwise herein. This Guaranty supersedes any and all prior agreements,
written or oral, with Guarantor relating to guaranteeing obligations under the
Contract and any other subject matter of this Guaranty. Any such prior
agreements are hereby terminated and of no further effect. The parties hereto
agree that in no event shall an oral modification of this Agreement be
enforceable or valid.

 5
 

 

(j)            Counterparts, Facsimile
Signatures. This Guaranty may be executed in any number of counterparts,
each of which shall be deemed an original for all purposes. This Guaranty may
be executed by a party’s signature transmitted by facsimile (“fax”), and copies
of this Guaranty executed and delivered by means of faxed signatures shall have
the same force and effect as copies hereof executed and delivered with original
signatures. All parties hereto may rely upon faxed signatures as if such
signatures were originals. Any party executing and delivering this Guaranty by
fax shall promptly thereafter deliver a counterpart signature page of this
Guaranty containing said party’s original signature. All parties hereto agree
that a faxed signature page may be introduced into evidence in any
proceeding arising out of or related to this Guaranty as if it were an original
signature page.

(k)           Rules of Construction.
This Guaranty has been negotiated by the parties and is to be interpreted
according to its fair meaning as if the parties had prepared it together and
not strictly for or against any party. References in this Guaranty to “Sections”
refer to Sections of this Guaranty, unless the context expressly indicates
otherwise. References to “provisions” of this Guaranty refer to the terms,
conditions, restrictions and promises contained in this Guaranty. References in
this Guaranty to laws and regulations refer to such laws and regulations as in
effect on this date and to the corresponding provisions, if any, of any
successor law or regulation. At each place in this Guaranty where the context
so requires, the masculine, feminine or neuter gender includes the others and
the singular or plural number includes the other. Forms of the verb “including”
mean “including without limitation” unless the context expressly indicates
otherwise. “Or” is inclusive and includes “and” unless the context expressly
indicates otherwise. The introductory headings at the beginning of Sections of
this Guaranty are solely for the convenience of the parties and do not affect
any provision of this Guaranty.

(1)           No Employment With Guarantor.
Executive understands and agrees that he is an employee of Obligor pursuant to
the Contract. Executive further understands and agrees that neither this
Guaranty nor any obligations performed hereunder shall change any employee
status that Executive may have with Guarantor.

IN WITNESS WHEREOF,
Executive and Guarantor have executed this Guaranty as of the day and year
first above written.

	
  

  	
  GUARANTOR

  
	
   

  	
   

  
	
   

  	
  Impac Mortgage
  Holdings, Inc.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Richard J.
  Johnson

  
	
   

  	
  Name: Richard J.
  Johnson

  
	
   

  	
  Title: Executive
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  EXECUTIVE

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ William D.
  Endresen

  
	
   

  	
   

  	
  William D. Endresen

  

 

 6

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