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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934

Filed by the Registrant ☒

Filed by a Party other than the Registrant ☐

Check the appropriate box:

☐

Preliminary Proxy Statement

☐

Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))

☒

Definitive Proxy Statement

☐

Definitive Additional Materials

☐

Soliciting Material under §240.14a-12

IMPAC MORTGAGE HOLDINGS, INC.

(Name of registrant as specified in its charter)

(Name of person(s) filing proxy statement, if other than the registrant)

Payment of Filing Fee (Check the appropriate box):

☒

No fee required.

☐

Fee paid previously with preliminary materials.

☐

Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11.

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IMPAC MORTGAGE HOLDINGS, INC.
19500 Jamboree Road
Irvine, California 92612

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

To Be Held on October 20, 2022
9:00 A.M. (Pacific Daylight Time)

To the Holders of Our Common Stock:

You are cordially invited to attend, virtually via the Internet, the special meeting of common stockholders of Impac Mortgage Holdings, Inc., a Maryland corporation (“we,” “our,” “us,” or the “Company”), to be held on October 20, 2022, at 9:00 a.m. (Pacific Daylight Time) (the “Special Meeting”). The Special Meeting will be a virtual meeting via live audio webcast on the Internet. You will be able to attend the Special Meeting, vote, and submit your questions during the Special Meeting by visiting: http://www.viewproxy.com/ImpacCompanies/2022SM/htype.asp. You will not be able to attend the Special Meeting physically.

The Special Meeting is being held in connection with the Company’s offers (as they may be amended from time to time, the “Exchange Offers”) to the holders of the outstanding shares of the Company’s 9.375% Series B Cumulative Redeemable Preferred Stock, par value $0.01 per share (the “Preferred B Stock”), and the Company’s 9.125% Series C Cumulative Redeemable Preferred Stock, par value $0.01 per share (the “Preferred C Stock,” and together with the Preferred B Stock, the “Preferred Stock”), to exchange all of the outstanding shares of Preferred Stock for certain cash, stock and warrant consideration, as more fully described in the attached proxy statement (the “Proxy Statement”). The Exchange Offers are being made pursuant to separate documents that have been delivered to the holders of our Preferred Stock. It is a condition to the consummation of the Exchange Offers that the holders of our common stock, par value $0.01 per share (the “Common Stock”), vote on, and approve, Proposals 1 through 3 described in the Proxy Statement. As a result, we are holding the Special Meeting of the holders of our Common Stock solely for the purpose of considering and voting on the following proposals:

Proposal 1 — A proposal to approve an amendment to our charter (as amended and as currently in effect, the “Charter”), to permit the closing of the Exchange Offers and to make each share of Preferred B Stock redeemable for the same consideration to be paid to holders of Preferred B Stock in the Exchange Offers, as more fully described in the accompanying Proxy Statement and as set forth in the Articles of Amendment (the “Preferred B Articles of Amendment”) attached hereto as Annex A-1 (the “Preferred B Proposed Amendment”);

Proposal 2 — A proposal to approve an amendment to our Charter to permit the closing of the Exchange Offers and to make each share of Preferred C Stock redeemable for the same consideration to be paid to holders of Preferred C Stock in the Exchange Offers, as more fully described in the accompanying Proxy Statement and as set forth in the Articles of Amendment (the “Preferred C Articles of Amendment”) attached hereto as Annex A-2 (the “Preferred C Proposed Amendment” and together with the Preferred B Proposed Amendment, the “Proposed Amendments”);

Proposal 3 — A proposal to approve, in accordance with Rule 713(a) of the NYSE American Company Guide, our issuance of up to 15,500,000 shares of Common Stock (including up to 4,437,280 shares of Common Stock which may be issued to comprise a portion of the Preferred B Common Fund, as described in the accompanying Proxy Statement), and up to 2,107,629 warrants to purchase Common Stock in connection with the Exchange Offers; and

Proposal 4 — A proposal to approve the adjournment of the Special Meeting to a later date or date(s), if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of Proposal 1, Proposal 2 and/or Proposal 3 above.

Proposal 4 will only be presented at the Special Meeting if there are not sufficient votes to approve Proposal 1, Proposal 2 and/or Proposal 3.

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No matters, other than the proposals described in this Notice of Special Meeting, will be considered at the Special Meeting. A Proxy Statement describing the matters to be considered at the Special Meeting to which you will be entitled to vote is attached to this notice. The Board of Directors has fixed the close of business on September 9, 2022 as the record date (the “Record Date”) for determination of stockholders entitled to notice of, and to vote at, the Special Meeting and any postponement or adjournment thereof. If you wish to attend the Special Meeting, you must register in advance at http://www.viewproxy.com/ImpacCompanies/2022SM/htype.asp by 11:59 pm, Pacific Daylight Time, on October 18, 2022.

Stockholders may virtually attend the Special Meeting via live audio webcast by clicking the link provided in the email that will be sent to you after registering. The webcast provides our stockholders rights and opportunities equivalent to an in-person meeting of stockholders.

You are cordially invited to attend the Special Meeting virtually. However, if you do not expect to attend or if you plan to attend but desire the proxy holders to vote your shares, please promptly date and sign the enclosed proxy card and return it in the enclosed postage paid envelope, or you may also instruct the voting of your shares over the Internet or by telephone by following the instructions on your proxy card. Voting by written proxy, over the Internet, or by telephone will not affect your right to vote at the Special Meeting in the event you find it convenient to attend.

				By order of the Board of Directors

	Dated: September 14, 2022			Joseph O. Joffrion, General Counsel

		YOUR VOTE IS IMPORTANT
		PLEASE PROMPTLY MARK, DATE, SIGN AND RETURN YOUR PROXY IN THE ENCLOSED POSTAGE-PAID ENVELOPE OR AUTHORIZE A PROXY TO VOTE YOUR SHARES BY TELEPHONE OR VIA THE INTERNET AS INSTRUCTED ON THE PROXY CARD. YOUR VOTE IS REVOCABLE IN ACCORDANCE WITH THE PROCEDURES SET FORTH IN THIS PROXY STATEMENT. IF YOU ATTEND THE SPECIAL MEETING, YOU MAY VOTE VIRTUALLY VIA THE INTERENT EVEN IF YOU RETURNED A PROXY.

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IMPAC MORTGAGE HOLDINGS, INC.
19500 Jamboree Road
Irvine, California 92612

PROXY STATEMENT

Special Meeting of Stockholders
October 20, 2022

This Proxy Statement, the proxy card, our Quarterly Report on Form 10-Q for the period ended June 30, 2022, and our Annual Report on Form 10-K for the year ended December 31, 2021 are also available to you at http://www.viewproxy.com/ImpacCompanies/2022SM/htype.asp.

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EXPLANATORY NOTE

This proxy statement (this “Proxy Statement”) relates to the Special Meeting (the “Special Meeting”) of the holders of common stock, par value $0.01 per share (the “Common Stock”), of Impac Mortgage Holdings, Inc., a Maryland corporation (“we,” “our,” “us,” or the “Company”), in connection with the Company’s offers (the “Exchange Offers”) to exchange each outstanding share of its 9.375% Series B Cumulative Redeemable Preferred Stock, par value $0.01 per share (the “Preferred B Stock”), and its 9.125% Series C Cumulative Redeemable Preferred Stock, par value $0.01 per share (the “Preferred C Stock” and, together with the Preferred B Stock, the “Preferred Stock”), for certain cash, stock and warrant consideration described in this Proxy Statement and in our Registration Statement filed on Form S-4 filed with the Securities and Exchange Commission (the “SEC”) on July 15, 2022 (as amended, the “Registration Statement”). While you, as a holder of our Common Stock, will not be asked to approve the Exchange Offers, you will be asked to approve the proposals presented at the Special Meeting (the “Proposals”), each of which is described in detail in this Proxy Statement. Each of the Proposals must be approved as a condition to the closing of the Exchange Offers so your vote is very important.

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	EXPLANATORY NOTE					i
	CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS					iv
	QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING, THE EXCHANGE OFFERS AND THE CONSENT SOLICITATION					1
	SUMMARY OF THE EXCHANGE OFFERS AND THE CONSENT SOLICITATION					9
	THE SPECIAL MEETING					20
	Proposals to be Considered at the Special Meeting					20
	Reasons for the Special Meeting and Consideration of the Proposals					21
	Registering to Attend the Special Meeting					21
	Voting Requirements & Procedures					22
	Record Date and Voting Rights					22
	Quorum and Counting of Votes					23
	Abstentions and Broker Non-Votes					23
	Revocability of Proxy					23
	Interest of Executive Officers and Directors and Greater than 5% Stockholders					23
	Householding					24
	Adjournment of the Special Meeting					24
	Appraisal Rights and the Right to Petition for Fair Value					24
	Proxy Solicitor					25
	Attendance at Special Meeting					25
	PROPOSAL 1 — PREFERRED B CHARTER AMENDMENT PROPOSAL					26
	General					26
	Elimination of Preferred B Stock					26
	Vote Required					27
	Board of Directors Recommendation					27
	PROPOSAL 2 — PREFERRED C CHARTER AMENDMENT PROPOSAL					28
	General					28
	Elimination of Preferred C Stock					28
	Vote Required					29
	Board of Directors Recommendation					29
	PROPOSAL 3 — STOCK ISSUANCE PROPOSAL					30
	General					30
	Vote Required					31
	Board of Directors Recommendation					31
	PROPOSAL 4 — ADJOURNMENT PROPOSAL					32
	General					32
	Consequences if the Adjournment Proposal is Not Approved					32
	Vote Required					32
	Board of Directors Recommendation					32
	CAPITALIZATION					33
	RISK FACTORS					35
	BACKGROUND OF THE EXCHANGE OFFERS AND THE CONSENT SOLICITATION					38
	Dividend Entitlements of Preferred B Stock					46
	Certain Considerations by the Board of Directors					47
	Conclusion of the Board of Directors					48
	Interests of Certain Stockholders					49
	Other Plans					49

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	THE EXCHANGE OFFERS AND THE CONSENT SOLICITATION					50
	General					50
	Consent Solicitation Provisions					54
	Comparison of Rights Between the Preferred Stock, the New Preferred Stock and the Common Stock					55
	Warrants					61
	Fractional Shares and Warrants					63
	Extension, Termination and Amendment					63
	Consequences for Failure to Participate					64
	Conditions of the Exchange Offers					65
	Waiver of Conditions					66
	Source of Funds					67
	Fees and Expenses					67
	Recommendations of the Directors, Executive Officers and Affiliates					67
	Voting Agreements					67
	MARKET PRICE FOR THE COMMON STOCK AND PREFERRED STOCK					69
	DIVIDEND POLICY AND DIVIDENDS PAID ON OUR COMMON STOCK AND PREFERRED STOCK					70
	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT					71
	Beneficial Ownership of Preferred Stock by Executive Officers, Directors and Large Stockholders					72
	STOCKHOLDER PROPOSALS					73
	Proposals to be Included in Proxy Statement.					73
	Proposals to be Submitted for Annual Meeting.					73
	Mailing Instructions					73
	Universal Proxy					73
	DESCRIPTION OF SECURITIES					74
	Authorized Capitalization					74
	Common Stock					74
	Preferred B Stock and Preferred C Stock					74
	New Preferred Stock					77
	Warrants					83
	Special Meetings of Stockholders					85
	Extraordinary Transactions					85
	Tax Benefits Preservation Rights Agreement					85
	HOW TO OBTAIN ADDITIONAL INFORMATION					90
	INCORPORATION BY REFERENCE					91
	ANNEX A-1 ARTICLES OF AMENDMENT — 9.375% SERIES B CUMULATIVE REDEEMABLE PREFERRED STOCK					92
	ANNEX A-2 ARTICLES OF AMENDMENT — 9.125% SERIES C CUMULATIVE REDEEMABLE PREFERRED STOCK					97
	ANNEX A-3 ARTICLES SUPPLEMENTARY — 8.25% SERIES D CUMULATIVE REDEEMABLE PREFERRED STOCK					102
	OTHER BUSINESS					112

iii

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CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

Throughout this Proxy Statement, we make forward-looking statements that are subject to risks and uncertainties. Forward-looking statements are generally identifiable by use of forward-looking terminology such as “may,” “will,” “should,” “potential,” “intend,” “expect,” “anticipate,” “estimate,” “approximately,” “believe,” “could,” “project,” “predict,” or other similar words or expressions. Additionally, statements regarding the following subjects are forward-looking by their nature:

•

the impact of coronavirus (COVID-19) and various strains of pandemic disease;

•

our business and investment strategy;

•

our ability to complete the Exchange Offers and/or receive approval for the Proposed Amendments (as defined in this Proxy Statement) on the terms described herein and in our Registration Statement filed on Form S-4 filed with the SEC on July 15, 2022, as amended, which is referred to herein as the Registration Statement;

•

our projected operating results;

•

completion of any pending transactions;

•

our ability to obtain future financing arrangements or restructure existing indebtedness;

•

our understanding of our competition;

•

market trends; and

•

the impact of technology on our operations and business.

Such forward-looking statements are based on our beliefs, assumptions, and expectations of our future performance taking into account all information currently known to us. These beliefs, assumptions, and expectations can change as a result of many potential events or factors, not all of which are known to us. If a change occurs, our business, financial condition, liquidity, results of operations, plans, and other objectives may vary materially from those expressed in our forward-looking statements. You should carefully consider these risks. Additionally, the following factors could cause actual results to vary from our forward-looking statements:

•

factors discussed herein under the sections titled “Risk Factors;”

•

successful development, marketing, sale and financing of new and existing financial products;

•

expansion of non-qualified mortgage (“NonQM”) loan originations and conventional and government-insured loan programs;

•

local, national and international economic conditions, and geo-political events, including inflation, interest rate movement, and the impact of the COVID-19 pandemic on the economy and demand for our products;

•

our ability to successfully diversify our loan products;

•

our ability to successfully sell loans to third-party investors;

•

volatility in the mortgage industry;

•

our ability to retain key executives and employees;

•

unexpected interest rate fluctuations and margin compression; performance of third-party sub-servicers;

•

our ability to manage personnel expenses in relation to mortgage production levels;

•

our ability to successfully use warehousing capacity and satisfy financial convenant requirements;

•

increased competition in the mortgage lending industry by larger or more efficient companies;

•

issues and system risks related to our technology;

•

our ability to successfully create cost and product efficiencies through new technology;

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•

more than expected increases in default rates or loss severities and mortgage related losses;

•

our ability to obtain additional financing through lending and repurchase facilities, debt or equity funding, strategic relationships or otherwise;

•

our ability to maintain adequate cash flow and liquidity to manage our operations;

•

the terms of any financing, whether debt or equity, that we do obtain and our expected use of proceeds from any financing;

•

increase in loan repurchase requests and ability to adequately settle repurchase obligations;

•

failure to create brand awareness;

•

the outcome, including any settlements, of litigation or regulatory actions pending against us or other legal contingencies;

•

our compliance with applicable local, state and federal laws and regulations;

•

other general market and economic conditions; and

•

success at managing the risks involved in the foregoing items and all other factors set forth in the Company’s public reports, including its Annual Report on Form 10-K for the year ended December 31, 2021, and particularly the discussion of risk factors within that document.

When considering forward-looking statements, you should keep in mind the risk factors and other cautionary statements in this Proxy Statement could cause our actual results and performance to differ significantly from those contained in our forward-looking statements. Additionally, many of these risks and uncertainties are currently amplified by and will continue to be amplified by, or in the future may be amplified by, the COVID-19 pandemic. The extent to which COVID-19 impacts us will depend on future developments, which are highly uncertain and cannot be predicted with confidence, including the scope, severity and duration of the pandemic, the actions taken to contain the pandemic or mitigate its impact, and the direct and indirect economic effects of the pandemic and containment measures, among others. Accordingly, we cannot guarantee future results or performance. Readers are cautioned not to place undue reliance on any of these forward-looking statements, which reflect our views as of the date of this Proxy Statement. Furthermore, we do not intend to update any of our forward-looking statements after the date of this Proxy Statement to conform these statements to actual results and performance, except as may be required by applicable law.

For additional information about factors that could cause actual results to differ materially from those described in the forward-looking statements, please see the information provided in the documents incorporated by reference in this Proxy Statement and referred to under “How to Obtain Additional Information” and “Incorporation by Reference.”

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QUESTIONS AND ANSWERS ABOUT THE SPECIAL MEETING, THE EXCHANGE OFFERS AND THE CONSENT SOLICITATION

WHY DOES THIS PROXY STATEMENT INCLUDE DETAILED INFORMATION ABOUT THE EXCHANGE OFFERS AND THE CONSENT SOLICITATION WHEN COMMON STOCKHOLDERS CANNOT PARTICIPATE IN ANY OF THESE TRANSACTIONS?

As a holder of Common Stock, you will not be asked to consent to the Exchange Offers, nor will you be able to participate in the Exchange Offers, except to the extent that you also hold Preferred Stock. However, the Exchange Offers are conditioned on the holders of our Common Stock approving (i) the Articles of Amendment (the “Preferred B Articles of Amendment”) attached hereto as Annex A-1 (the “Preferred B Proposed Amendment”) (such proposal referred to herein as “Proposal 1” or the “Preferred B Charter Amendment Proposal”), and (ii) the Articles of Amendment (the “Preferred C Articles of Amendment”) attached hereto as Annex A-2 (the “Preferred C Proposed Amendment,” and together with the Preferred B Proposed Amendment, the “Proposed Amendments”) (such proposal referred to herein as “Proposal 2” or the “Preferred C Charter Amendment Proposal”). In addition, because the Exchange Offers will involve the issuance of up to 10,630,918 shares of Common Stock (plus up to 4,437,280 shares of Common Stock which may be issued to comprise a portion of the Preferred B Common Fund, as defined below, if the Exchange Offers close), and up to 2,107,629 warrants to purchase Common Stock if the transactions close, which would be in excess of 20% of our outstanding Common Stock, in accordance with the rules of the NYSE American, we are required to obtain stockholder approval prior to the issuance of Common Stock in connection with the Exchange Offers (“Proposal 3” or the “Stock Issuance Proposal”). Rule 713(a) of the NYSE American Company Guide requires stockholder approval if the issuance of Common Stock at a price less than the greater of book or market value which together with sales by officers, directors or principal stockholders of the issuer equals 20% or more of the Common Stock outstanding before the issuance, or when the issuance of Common Stock is equal to or more than 20% of presently outstanding Common Stock for less than the greater of book or market value of the stock. The exact number of shares of Common Stock to be issued in the Exchange Offers will depend on the aggregate amount of shares of Preferred Stock tendered in the Exchange Offers in exchange for the Common Stock Portions (as defined below) and any further amendments to the Exchange Offers. We intend to redeem any remaining outstanding shares of Preferred Stock from holders which who do not participate in the Exchange Offers no earlier than eleven (11) business days after closing of the Exchange Offers and as soon as practicable thereafter for the same consideration which is provided to holders participating in the Exchange Offers. As a holder of Common Stock, you are entitled to vote on Proposal 1, Proposal 2, and Proposal 3. To ensure that you have the necessary information to make an informed decision when voting on these Proposals, and because of relevant rules of the SEC that entitle you to receive certain information regarding the Proposals, we are providing you with the information contained in this Proxy Statement regarding the Exchange Offers and the consent solicitation (the “Consent Solicitation”) seeking consents from the holders of each series of Preferred Stock (the “Preferred Holders”), on a series by series basis, to the Proposed Amendments. In addition, if necessary, you, as a holder of our Common Stock, will be presented with a proposal (“Proposal 4” or the “Adjournment Proposal”) to approve the adjournment of the Special Meeting to a later date or date(s) to permit the further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of Proposal 1, Proposal 2 or Proposal 3.

WHY IS THE COMPANY OFFERING TO EXCHANGE THE PREFERRED STOCK?

The Exchange Offers are part of our proposed recapitalization to improve our capital structure in light of the Company’s large and growing financial obligation to holders of its Preferred B Stock and the liquidation preference of holders of the Preferred B Stock and the Preferred C Stock, which the Company believes impede its growth and reduce strategic opportunities available to it. The Preferred B Stock bears an annual cumulative dividend equivalent to 9.375% of its liquidation preference of $25.00 per share, and the Preferred C Stock bears a noncumulative annual dividend equivalent to 9.125% of its liquidation preference of $25.00 per share. In addition, each of the Preferred B Stock and Preferred C Stock has a liquidation preference of $25.00 per share plus, in the case of the Preferred B Stock, accumulated and unpaid dividends. As a result, as of June 30, 2022, the Company has cumulative

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undeclared dividends in arrears of approximately $19.9 million, or approximately $29.88 per outstanding share of Preferred B Stock, thereby increasing the liquidation value of the Preferred B Stock to approximately $54.88 per share. Every quarter, the amount of cumulative undeclared dividends in arrears increases by $0.5859 per share of Preferred B Stock, or approximately $390,000 in the aggregate.

We have not paid dividends on any series of Preferred Stock since 2008, and we do not expect to pay dividends on any series of Preferred Stock for the foreseeable future. Further, as of June 30, 2022, the aggregate liquidation value of all series of Preferred Stock, including the accumulated and unpaid dividends on the Preferred B Stock, is approximately $71.7 million, which amount increases by approximately $390,000 in the aggregate every quarter, compared to the aggregate market value of all series of Preferred Stock of approximately $7.85 million based on the last reported sales prices of each series of Preferred Stock on September 9, 2022. All accumulated and unpaid dividends on our Preferred B Stock must be paid prior to any payments of dividends or other distributions on our Common Stock. The proposed recapitalization would have the result of removing this dividend priority and eliminating the Preferred Stock (including all accumulated and unpaid dividends) for shares that are tendered in the Exchange Offers and, for any remaining shares of Preferred Stock which are not tendered in the Exchange Offers, upon redemption of such shares, which we intend to complete no sooner than eleven (11) business days after the closing of the Exchange Offers and as soon as practicable thereafter. If the Exchange Offers are consummated, assuming all shares of Preferred Stock participate, approximately $19.9 million in accumulated and unpaid dividends on the Preferred B Stock (through June 30, 2022) will not be paid, no further dividends on the Preferred Stock will accumulate or be paid, and the Preferred Stock will be eliminated, including its liquidation preferences. As further described below, the exchange of the Preferred B Stock as contemplated by the Exchange Offers will not prejudice any person’s rights, if any, to receive amounts in connection with the matter Curtis J. Timm, et al. v Impac Mortgage Holdings, Inc., et al. (the “Maryland Action”). While we expect to issue shares of the 8.25% Series D Cumulative Redeemable Preferred Stock, par value $0.01 per share (the “New Preferred Stock”), in lieu of cash as part of the Exchange Offers on the terms described herein and in our Registration Statement on Form S-4, the dividend rate and liquidation preference of such New Preferred Stock will be substantially less than the dividend rate and liquidation preferences of our Preferred B Stock and Preferred C Stock as further described herein. We believe that the lower dividend rate and liquidation preference will improve our prospects for alternative financing arrangements because it will reduce the preferential amounts payable in the event there were a liquidation of the Company. See “Description of Securities — Common Stock,” “Description of Securities — New Preferred Stock,” and “Comparison of Rights Between the Preferred Stock, the New Preferred Stock and the Common Stock.”

WILL THE HOLDERS OF PREFERRED B STOCK RECEIVE ANY AMOUNTS WITH RESPECT TO SUCH PREFERRED B STOCK IN CONNECTION WITH THE MARYLAND ACTION?

Pursuant to its Judgment Order, dated July 16, 2018, as amended by Order of July 24, 2018, in the Maryland Action, the Circuit Court for Baltimore City (the “Circuit Court”), ordered that holders of Preferred B Stock are entitled to receive an amount equal to three quarters of dividends in the second, third and fourth quarters of 2009, or approximately $1.76 per share of Preferred B Stock (“2009 Dividend Amount”). On July 22, 2022, as amended on August 8, 2022, the Circuit Court issued an Order Certifying and Class and Providing for Class Notice and Final Hearing (“Class Certification Order”), making a preliminary determination that holders of shares of Preferred B Stock as of August 15, 2022 are entitled to receive the 2009 Dividend Amount, subject to final determination and judgment as to the holders of Preferred B Stock entitled to receive the 2009 Dividend Amount, as well as final determination after notice to class members and the opportunity to object before the Final Hearing on December 5, 2022. As required by the Class Certification Order, on August 12, 2022, each of the plaintiffs filed petitions for a court award of attorney’s fees, expenses or other monetary awards to be deducted and paid from the Company’s payment of any future distributions or other payments to the holders of the Company’s Preferred B Stock, including the 2009 Dividend Amount and the Preferred B Consideration (as hereinafter defined) (collectively, the “Plaintiff Preferred B Award Motions”). On August 18, 2022, as required by the Class Certification Order, the Company deposited $1,169,985.94, representing the full amount of the 2009 Dividend Amount, to the registry of the Circuit Court. Pursuant to the Class Certification Order, the Company has no further right or obligation with respect to the

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2009 Dividend Amount, except as necessary to carry out the final orders of the Circuit Court. The Plaintiff Preferred B Award Motions seek an aggregate of $905,291.11 from the 2009 Dividend Amount. If the Plaintiff Preferred B Award Motions are granted in full, after notice to class members in the manner approved by the Circuit Court and opportunity to object before the Final Hearing, we anticipate that approximately $0.40 per share would remain available for distribution to holders of Preferred B Stock from the 2009 Dividend Amount upon final determination by the Circuit Court. Distribution of the portion of the 2009 Dividend Amount that remains after final decision on the Plaintiff Preferred B Award Motions is subject to final judgment by the Circuit Court.

On August 25, 2022, the Circuit Court issued an Order to Segregate Funds and/or Stock (the “Segregation Order”), directing the Company, if the Exchange Offer for the Preferred B Stock is completed prior to December 5, 2022, to deposit $1,331,184 in cash with the registry of the Circuit Court or, if holders of Preferred B Stock do not receive cash in the Exchange Offers, 13,311,840 shares of New Preferred Stock, plus, in either event, 4,437,280 shares of Common Stock (collectively, the “Preferred B Common Fund”) in the custody of a third party custodian or escrow agent approved by class counsel. Allocation of this Preferred B Common Fund will be made by Circuit Court upon final disposition of the Plaintiff Preferred B Award Motions, which will include disposition of any excess funds not awarded to the plaintiffs and plantiffs’ counsel. Once deposited, the Company will have no further right or obligation with respect to the Plaintiff Preferred B Common Fund, except as necessary to carry out the final orders of the Circuit Court. The Plaintiff Preferred B Award Motions seek awards out of the Preferred B Consideration in excess of the amount of the Preferred B Common Fund. If all Plaintiff Preferred B Award Motions are granted by the Circuit Court in full, after notice to class members in the manner approved by the Circuit Court and opportunity to object before the Final Hearing, no amounts will remain from the Preferred B Common Fund for distribution to former holders of Preferred B Stock. Holders of Preferred B Stock who participate in the Exchange Offer or whose shares are redeemed pursuant to the Special Redemption will only receive any amounts from the Preferred B Common Fund if and to the extent that the Circuit Court determines to reduce the amounts requested in the Plaintiff Preferred B Award Motions. Distribution of the portion, if any, that may remain from the Preferred B Common Fund after final decision on the Plaintiff Preferred B Award Motions is subject to compliance with all applicable laws.

We expect that payment of any monetary awards pursuant to the Plaintiff Preferred B Award Motions, and the distribution of funds from the 2009 Dividend Amount and any funds from the Preferred B Common Fund to the holders of Preferred B Stock will occur promptly after the Final Judgment Order becomes effective, which will be 31 days after such order is docketed with no appeal having been taken, or the date on which all appeals have been resolved or exhausted. Based on the Circuit Court’s Class Certification Order, we currently anticipate that a hearing will be held on December 5, 2022, after which the Circuit Court will issue its final order disposing of all outstanding matters, including the (i) final determination of holders of Preferred B Stock entitled to distribution of the amount of the 2009 Dividend Amount, (ii) awards pursuant to the Plaintiff Preferred B Award Motions, and (iii) disposition of any funds remaining in the Preferred B Common Fund (if any) after such awards.

The tender of shares of Preferred B Stock in the Exchange Offer, or the subsequent Special Redemption (as hereinafter defined) of shares of Preferred B Stock, will not impair any rights that the holders of Preferred B Stock may have to receive amounts the Circuit Court may order be distributed in the Maryland Action, from the Preferred B Common Fund or the 2009 Dividend Amount. Holders of Preferred B Stock are not required to participate in the Exchange Offer to receive their share, if any, from the 2009 Dividend Amount or, assuming the Exchange Offer closes, from the Preferred B Common Fund so long as they held Preferred B Stock as of the dates set forth by the Circuit Court.

WHY IS THE COMPANY CALLING A SPECIAL MEETING?

The board of directors of the Company (the “Board of Directors” or the “Board”) is calling this Special Meeting in connection with the Exchange Offers. The Board of Directors is seeking approval of the holders of our Common Stock of the Proposed Amendments and the issuance of up to 15,500,000 shares of our Common Stock (including up to 4,437,280 shares of Common Stock which may be issued in connection with the Plaintiff Preferred B Award Motions) and up to 2,107,629 warrants to purchase

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Common Stock in connection with the Exchange Offers. The approvals of Proposal 1, Proposal 2, and Proposal 3 by the requisite vote of the holders of our Common Stock as required by Maryland law, our Charter, our bylaws (the “Bylaws”) and the rules of the NYSE American is a condition to the closing of the Exchange Offers for each series of Preferred Stock. Proposal 4, if adopted, will allow our Board of Directors to adjourn the Special Meeting to a later date or date(s) to permit further solicitation of proxies. Proposal 4 will only be presented to our stockholders in the event that there are insufficient votes for, or otherwise in connection with, the approval of one or more of the other Proposals. Proposal 1 and Proposal 2 must be approved by holders of shares of Common Stock entitled to cast a majority of all of the votes entitled to be cast on such proposal. Assuming a quorum is present, the affirmative vote of a majority of the votes cast on Proposal 3 and, if necessary, Proposal 4, is required to approve Proposal 3 and, if necessary, Proposal 4, respectively.

The following is a summary of the Proposed Amendments and is qualified in its entirety by reference to our charter (as amended and as currently in effect, the “Charter”) and the amended text of the affected provisions of our Charter reflecting the Proposed Amendments, set forth in Annex A-1 and Annex A-2. The Proposed Amendments, if approved by our stockholders, would:

permit the closing of the Exchange Offers without payment of, or allowance for, any accrued and unpaid dividends on any shares of Preferred Stock (whether or not such dividends have accumulated and whether or not such dividends accrued before or after the completion of the Exchange Offers), including the authorization, classification and issuance of the New Preferred Stock without a separate vote of the holders of Preferred B Stock or Preferred C Stock, as the case may be;

make all shares of Preferred B Stock that remain outstanding after the Exchange Offer closes redeemable by the Company in whole, and not in part, into the same consideration that holders of Preferred B Stock that participate in the Exchange Offer received, which is equal to (a) $3.00 in cash or, if payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions, as defined and described below, thirty (30) shares of New Preferred Stock, whichever is paid in the Exchange Offer, and (b) 13.33 shares of Common Stock (collectively, the “Preferred B Remainder Consideration”), by the date that is two (2) years after the date on which the Preferred B Articles of Amendment are accepted for filing by the Maryland State Department of Assessments and Taxation of Maryland (the “SDAT”) (such acceptance date, the “Preferred B Amendment Effective Date”);

make all shares of Preferred C Stock that remain outstanding after the Exchange Offer closes redeemable by the Company in whole, and not in part, into the same consideration offered to the holders of Preferred C Stock that participate in the Exchange Offer received, which is equal to (a) $0.10 in cash or, if payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions, one (1) share of New Preferred Stock, whichever is paid in the Exchange Offer, (b) 1.25 shares of the Company’s Common Stock and (c) 1.5 warrants to purchase 1.5 shares of the Company’s Common Stock, subject to adjustment as described below to prevent the issuance of any fractional shares or warrants (collectively, the “Preferred C Remainder Consideration” and together with the Preferred B Remainder Consideration, the “Preferred Stock Remainder Consideration”) by the date that is two (2) years after the date on which the Preferred C Articles of Amendment are accepted for filing by the SDAT (such acceptance date, the “Preferred C Amendment Effective Date,” and together with the Preferred B Amendment Effective Date, the “Amendment Effective Dates”); and

if the Company has not exercised its right to redeem the Preferred B Stock or Preferred C Stock by the date that is sixty-five (65) days after the applicable Amendment Effective Date, as the case may be, require the Company, upon request of any holder of Preferred B Stock or Preferred C Stock within two (2) years after the applicable Amendment Effective Date, to redeem all of the outstanding shares of such series of Preferred Stock for the applicable Preferred Stock Remainder Consideration on the date fixed by the Company within ninety (90) days of such request, subject to any delay required by the Company to comply with applicable Maryland law relating to limitations on payment of the Preferred Stock Remainder Consideration. We refer to any such redemption as contemplated by the Proposed Amendments

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as a “Special Redemption”). If any shares of Preferred B Stock or Preferred C Stock (not otherwise participating in the Exchange Offers) have still not been redeemed by the second (2nd) anniversary of the Amendment Effective Date, such shares will remain outstanding with all of their current rights, preferences and privileges.

A violation of the “Cash Consideration Restrictions” will occur if the occurrence of an action would cause (i) us to violate the restrictions on payment of distributions to stockholders under section 2-311 of the Maryland General Corporation Law, or the “MGCL,” (ii) any material breach of or default under the terms and conditions of any obligation of the Company, including any agreement relating to its indebtedness, or (iii) us to violate any restriction or prohibition of any law rule or regulation applicable to the Company or of any order, judgment or decree of any court or administrative agency.

Under section 2-311 of the MGCL, a Maryland corporation generally cannot make any type of distribution to its stockholders, including a redemption or repurchase of stock in exchange for cash, other assets or indebtedness of the corporation, if, after giving effect to the distribution, the corporation would not be able to pay its debts as they become due in the usual course of business, or if the corporation’s total assets would be less than the sum of the corporation’s total liabilities plus, unless its charter permits otherwise (which our Charter does not), the amount that would be needed, if the corporation were to be dissolved at the time of the distribution, to satisfy the preferential rights upon dissolution of stockholders whose preferential rights on dissolution are superior to those receiving the distribution. Notwithstanding this restriction, a Maryland corporation may make a distribution from: (i) its net earnings for the fiscal year in which the distribution is made; (ii) its net earnings for the preceding fiscal year; or (iii) the sum of its net earnings for its preceding eight fiscal quarters even if, after such distribution, the corporation’s total assets would be less than its total liabilities, if, after giving effect to the distribution, the corporation would be able to pay its debts as they become due in the usual course of its business. The Company does not have net earnings during the current or preceding fiscal year, or over the prior eight fiscal quarters. As of June 30, 2022, the Company’s total assets, calculated in accordance with GAAP, exceeded its total liabilities by $3.452 million, following operating losses during the first and second quarters of 2022 of $26.3 million, or approximately $4.4 million per month. If all outstanding shares of Preferred Stock participate in the Exchange Offers, the total amount of cash payable in exchange for tendered shares of Preferred Stock would be approximately $2.14 million, and if the minimum two-thirds of the outstanding shares of each series of Preferred Stock participate in the Exchange Offers, the total amount of cash payable in exchange for tendered shares of Preferred Stock would be approximately $1.43 million. Although a final determination will be made by the Board of Directors at least five (5) business days prior to the expiration of the Exchange Offers based on the value of the Company's assets and liabilities and the Company's financial condition at the time of closing of the Exchange Offers, we currently anticipate that, at the time of closing of the Exchange Offers, the payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions and that we will issue shares of New Preferred Stock in lieu of cash in the Exchange Offers and upon Special Redemption of any shares of Preferred Stock.

No fractional shares of Common Stock or New Preferred Stock will be issued in the Exchange Offers or upon any Special Redemption of Preferred Stock. In lieu of any fractional share of Common Stock or New Preferred Stock to be issued in the Exchange Offers or upon any Special Redemption of Preferred Stock, any fraction of a share of Common Stock or New Preferred Stock will be rounded up to the next whole share of Common Stock or New Preferred Stock, as applicable. No fractional warrants will be issued in the Exchange Offer or upon Special Redemption of any Preferred C Stock. If a holder of Preferred C Stock would be entitled to receive a fractional warrant in the Exchange Offer or upon any Special Redemption of any Preferred C Stock, the Company will round the warrant down to the nearest whole number of warrants to be issued.

Holders of shares of Preferred Stock exchanged in the Exchange Offers will receive only the applicable Preferred Stock Consideration, as hereinafter defined. We will have no obligation to pay or make allowance for, and we will not make any other payment of or allowance for, the liquidation preference of, or any accrued and unpaid dividends on, any shares of Preferred Stock (whether or not such dividends have accumulated and whether or not such dividends accrued before or after the Exchange Offers) in connection with the repurchase of any shares of Preferred Stock pursuant to the Exchange Offers. As

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further described below, the exchange of the Preferred B Stock as contemplated by the Exchange Offers will not prejudice any person’s rights, if any, to receive amounts in connection with the Maryland Action.

If the holders of 662∕3% of the outstanding shares of each series of Preferred Stock have consented to the Exchange Offers and the Proposed Amendments and the holders of our Common Stock approve Proposal 1, Proposal 2, and Proposal 3 as required by Maryland law, our Charter, our Bylaws and the rules of the NYSE American at the Special Meeting, we will file the Preferred B Articles of Amendment and the Preferred C Articles of Amendment with the SDAT to effect the Proposed Amendments promptly after the expiration of the Exchange Offers. The Company intends to complete the Special Redemption of any shares of Preferred B Stock and Preferred C Stock that remain outstanding after completion of the Exchange Offers no sooner than eleven (11) business days after the closing of the Exchange Offer relating to any such series of Preferred Stock and as soon as practicable thereafter.

For additional information regarding the Consent Solicitation, see “The Exchange Offers and the Consent Solicitation — Consent Solicitation Provisions.” We urge you to review these sections closely.

WHEN DOES THE COMPANY EXPECT TO COMPLETE THE EXCHANGE OFFERS?

We expect to complete the Exchange Offers at the end of the third quarter or beginning of the fourth quarter of 2022.

WHAT IF ANY OR ALL OF THE PROPOSALS DO NOT PASS?

If any or all of Proposal 1, Proposal 2 and/or Proposal 3 are not approved by holders of our Common Stock, the Exchange Offers will not close and the Charter will not be amended to reflect the Proposed Amendments. Furthermore, if Proposal 4 is not presented and is not approved by our stockholders, our Board of Directors may not be able to adjourn the Special Meeting to a later date in the event that there are insufficient votes for, or otherwise in connection with, the approval of one or more of the other Proposals. In that case, the accumulated and unpaid dividends on the Preferred B Stock would not be eliminated and will be payable to the applicable Preferred Holders when, as and if declared by our Board of Directors. Further, dividends on such Preferred B Stock will continue to accumulate until declared and paid and the Preferred Stock would not be eliminated. See our answer to “Why is the Company proposing to recapitalize the Preferred Stock?” above.

We believe that there could be significant adverse consequences to the Company if the contemplated Exchange Offers and the related Special Redemptions of our Preferred B Stock and Preferred C Stock are not successfully completed. If the required approvals from holders of both the Preferred B Stock and Preferred C Stock, as well as the holders of our Common Stock, are not received, and/or we are not able to otherwise complete the Exchange Offers and the related Special Redemptions, then we may not be able to meet our financial or business objectives. In light of the continuing turmoil in the mortgage market and rising interest rates, our ability to continue our operations is dependent upon our ability to raise capital, successfully implement our strategic initiatives and engage in operations that contribute sufficient additional cash flow to enable us to meet our current and future expenses. Our future financial performance and success are dependent in large part upon our ability to implement our contemplated strategies successfully. Our ability to raise future capital may be dependent on third parties who, in the past, have either been hesitant to lend or invest in the Company due to the capital structure of the Company, including the Preferred B Stock and Preferred C Stock, or have offered terms which our Board of Directors has determined are not in our best interests. To the extent the Exchange Offers and the related Special Redemptions are not successful in eliminating our outstanding Preferred Stock, we may be unable to raise the additional capital required to permit us to implement our strategic initiatives and continue our operations as planned, thereby requiring us to further reduce our operating costs and expenses so that our income can cover those costs and expenses.

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(iii) a distribution of profitable assets, (iv) alternative offers to exchange our outstanding securities and debt obligations, (v) the incurrence of additional debt, (vi) obtaining additional equity capital on terms that may be onerous or highly dilutive, and/or (vii) joint ventures.

In addition, the holders of our outstanding $15 million in convertible promissory notes (the “Convertible Debt”) have extended the maturity date of the Convertible Debt until May 9, 2025 (with three principal payments of $5 million on each of May 9, 2023, May 9, 2024 and May 9, 2025), conditioned on our completion of the Exchange Offers and providing notice of redemption of the remaining Preferred Stock by October 31, 2022. If we do not complete the Exchange Offers and provide such notice, the Convertible Debt be due on November 9, 2022, which also could have a material adverse effect on our business and financial position.

For a more complete description of the risks relating to our failure to complete the Exchange Offers, see “Risk Factors.”

WHAT IF YOU DO NOT VOTE?

If you do not vote on Proposal 1 or Proposal 2, that will have the same effect as a vote “AGAINST” Proposal 1 or Proposal 2, respectively. Assuming a quorum is present, your failure to vote on Proposal 3 and, if presented, Proposal 4, will have no effect on the outcome of Proposal 3 and Proposal 4, respectively. Proposal 1 and Proposal 2 must be approved by holders of shares of Common Stock entitled to cast a majority of all of the votes entitled to be cast at the Special Meeting. Assuming a quorum is present, Proposal 3 and, if presented, Proposal 4, must be approved by the affirmative vote of a majority of the votes cast on such proposal.

Even if the Preferred Holders consent to the Proposed Amendments through the Consent Solicitation, Proposal 1, Proposal 2 and Proposal 3 must be approved by the holders of Common Stock at the Special Meeting to complete the Exchange Offers.

HOW DOES THE BOARD OF DIRECTORS RECOMMEND THAT I VOTE?

The Board of Directors recommends that the holders of Common Stock vote “FOR” each of the Proposals.

DO I HAVE ANY APPRAISAL RIGHTS IN CONNECTION WITH THE MATTERS TO BE VOTED ON AT THE SPECIAL MEETING?

No. You will not have appraisal rights, rights of an objecting stockholder, or any contract right to petition for fair value, with respect to any matter to be acted upon at the Special Meeting. We will not independently provide such a right.

WHICH PROPOSALS WILL I BE ENTITLED TO VOTE ON AS A HOLDER OF COMMON STOCK?

As a holder of Common Stock, you will be entitled to vote on all business properly brought before the Special Meeting, including Proposal 1 (to approve the Preferred B Proposed Amendment), Proposal 2 (to approve the Preferred C Proposed Amendment), and Proposal 3 (to approve the issuance of up to 15,500,000 shares of our Common Stock and up to 2,107,629 warrants to purchase Common Stock) and, if presented, Proposal 4 (to approve the adjournment of the Special Meeting to a later date or date(s) to permit further solicitation of proxies).

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WHO CAN I CONTACT TO REQUEST ANOTHER COPY OF THE PROXY STATEMENT?

You can contact the Company to request another copy of the Proxy Statement at:

Impac Mortgage Holdings, Inc.
19500 Jamboree Road,
Irvine, California 92612
Attention: Justin R. Moisio, Corporate Secretary
Phone: (949) 475-3600
Email: justin.moisio@impacmail.com

WHO CAN I CONTACT WITH QUESTIONS ABOUT THE SPECIAL MEETING?

You can contact the Company, at:

Impac Mortgage Holdings, Inc.
19500 Jamboree Road,
Irvine, California 92612
Attention: Justin R. Moisio, Corporate Secretary
Phone: (949) 475-3600
Email: justin.moisio@impacmail.com

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SUMMARY OF THE EXCHANGE OFFERS AND THE CONSENT SOLICITATION

This summary highlights the material information contained in this Proxy Statement, but may not include all of the information that you, as a holder of Common Stock, would like to know. To fully understand the Exchange Offers and the Consent Solicitation, and for a more complete description of the legal terms of the Exchange Offers and the Consent Solicitation, you should carefully read this entire document, including the other documents we refer to in this document.

The Company

Impac Mortgage Holdings, Inc.

The Address and Phone Number of the Company’s Principal Executive Offices

19500 Jamboree Road
Irvine, California 92612
(949) 475-3600

The Company’s Business

The Company was founded in 1995 and is an established nationwide independent residential mortgage lender which originates, sells and services residential mortgage loans. We originate non-qualified mortgages (“NonQM”), conventional mortgage loans, which are intended to be eligible for sale to U.S. government-sponsored enterprises, (“GSEs”), including the Federal National Mortgage Association (“Fannie Mae”), the Federal Home Loan Mortgage Corporation (“Freddie Mac”) (conventional loans), and government-insured mortgage loans eligible for government securities issued through the Government National Mortgage Association (Ginnie Mae or government loans).

Preferred Stock Subject to the Exchange Offers and the Consent Solicitation

All of the outstanding shares of Preferred B Stock and Preferred C Stock are subject to the Exchange Offers and are entitled to vote in the Consent Solicitation.

Exchange Offers

We are offering to exchange each outstanding share of the following series of Preferred Stock for the consideration identified below subject to the conditions set forth herein:

	Security			Cash/New Preferred Stock Per Share			Common Securities Per Share
	Preferred B Stock			$3.00 in cash or, if payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions described below, thirty (30) shares of New Preferred Stock, (the “Preferred B Cash/New Preferred Stock Portion”), as more fully described below.			13.33 shares of the Company’s Common Stock (the “Preferred B Common Stock Portion, and together with the Preferred B Cash/New Preferred Stock Portion, the “Preferred B Consideration”), as more fully described below.

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	Security			Cash/New Preferred Stock Per Share			Common Securities Per Share
	Preferred C Stock			$0.10 in cash or, if payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions described below, one (1) shares of New Preferred Stock (the “Preferred C Cash/New Preferred Stock Portion”), as more fully described below.			1.25 shares of Common Stock and 1.5 warrants to purchase 1.5 shares of Common Stock at an exercise price of $5.00 per share (collectively, the “Preferred C Common Stock Portion,” and together with the Preferred C Cash/New Preferred Stock Portion, the “Preferred C Consideration”), as more fully described below.

As used herein, the Preferred B Common Stock Portion and the Preferred C Common Stock Portion are collectively referred to as the “Common Stock Portions,” and the Preferred B Cash/New Preferred Stock Portion and Preferred C Cash/New Preferred Stock Portion are collectively referred to as the “Cash/New Preferred Stock Portions.” The Common Stock Portions and the Cash/New Preferred Stock Portions are collectively referred to herein as the “Preferred Stock Consideration.”

A violation of the Cash Consideration Restrictions will occur if the occurrence of an action would cause (i) us to violate the restrictions on payment of distributions to stockholders under section 2-311 of the MGCL, (ii) any material breach of or default under the terms and conditions of any obligation of the Company, including any agreement relating to its indebtedness, or (iii) us to violate any restriction or prohibition of any law rule or regulation applicable to the Company or of any order, judgment or decree of any court or administrative agency. The Company does not have net earnings during the current or preceding fiscal year, or over the prior eight fiscal quarters. As of June 30, 2022, the Company’s total assets, calculated in accordance with GAAP, exceeded its total liabilities by $3.452 million, following operating losses during the first and second quarters of 2022 of $26.3 million, or approximately $4.4 million per month. If all outstanding shares of Preferred Stock participate in the Exchange Offers, the total amount of cash payable in exchange for tendered shares of Preferred Stock would be approximately $2.14 million, and if the minimum two-thirds of the outstanding shares of each series of Preferred Stock participate in the Exchange Offers, the total amount of cash payable in exchange for tendered shares of Preferred Stock would be approximately $1.43 million. Although a final determination will be made by the Board of Directors at least five (5) business days prior to the expiration of the Exchange Offers based on the value of the Company's assets and liabilities and the Company's financial condition at the time of closing of the Exchange Offers, we currently anticipate that, at the time of closing of the Exchange Offers, the

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payment of cash consideration in the Exchange Offers would cause us to violate the Cash Consideration Restrictions and that we will issue shares of New Preferred Stock in lieu of cash in the Exchange Offers.

No fractional shares of Common Stock or New Preferred Stock will be issued in the Exchange Offers. In lieu of any fractional share of Common Stock or New Preferred Stock to be issued in the Exchange Offers, any fraction of a share of Common Stock or New Preferred Stock will be rounded up to the next whole share of Common Stock or New Preferred Stock, as applicable. No fractional warrants will be issued in the Exchange Offer. If a holder of Preferred C Stock would be entitled to receive a fractional warrant in the Exchange Offer, the Company will round the warrant down to the nearest whole number of warrants to be issued.

Holders of shares of Preferred Stock exchanged in the Exchange Offers will receive only the applicable Preferred Stock Consideration. We will have no obligation to pay or make allowance for, and will not make any other payment or allowance for, the liquidation preference of, or any accrued and unpaid dividends on, any shares of Preferred Stock (whether or not such dividends have accumulated and whether or not such dividends accrued before or after the Exchange Offer) in connection with the repurchase of any shares of Preferred Stock pursuant to the Exchange Offers. The exchange of the Preferred B Stock as contemplated by the Exchange Offers will not prejudice any person’s rights, if any, to receive amounts in connection with the Maryland Action.

See “The Exchange Offers and the Consent Solicitation — General.”

Common Stock Outstanding Before the Exchange Offers

As of the close of business on September 9, 2022 (the “Record Date”), the Company had 21,500,935 shares of Common Stock outstanding.

Common Stock Outstanding After the Exchange Offers

Assuming that 100% of the shares of Preferred Stock are accepted for exchange in the Exchange Offers, we will issue approximately 10,630,918 shares of our Common Stock and warrants to purchase an additional 2,107,629 shares of our Common Stock, subject to adjustment described herein. We will also issue approximately 4,437,280 shares of Common Stock pursuant to the Segregation Order to comprise a portion of the Preferred B Common Fund.

Warrants Outstanding After the Exchange Offers

Warrants to purchase approximately 2,107,629 shares of our Common Stock.

New Preferred Stock Outstanding After the Exchange Offers

Assuming that 100% of the shares of Preferred Stock are accepted for exchange in the Exchange Offers and paying cash would cause us to violate the Cash Consideration Restrictions, we will issue approximately 21,372,846 shares of New Preferred Stock, subject to adjustment as described herein. In that case, we will also issue approximately 13,311,840 shares of New Preferred Stock pursuant to the Segregation Order to constitute a portion of the Preferred B Common Fund.

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Outstanding Shares of Preferred Stock Prior to the Exchange Offers

Preferred B Stock: 665,592 shares

Preferred C Stock: 1,405,086 shares

Consent Solicitation

As part of the Exchange Offers, we are soliciting consent from the holders of each series of Preferred Stock to the Exchange Offer and the Proposed Amendment applicable to that series of Preferred Stock. Consent to the Exchange Offer and the Proposed Amendment applicable to each series of Preferred Stock must be received from holders of at least 662∕3% of the outstanding shares of each series of Preferred Stock. We will only file the Proposed Amendments if the requisite consents from the holders of both series of Preferred Stock (and the holders of our Common Stock) have been received. The Proposed Amendments and the issuance of Common Stock in the Exchange Offers, which will constitute more than 20% of the outstanding shares of the Company’s Common Stock, must also be approved by holders of our Common Stock as required by Maryland law, our Charter, our Bylaws and the rules of the NYSE American. We are holding the Special Meeting to obtain the approval of the Proposed Amendments and the issuance of Common Stock and warrants in the Exchange Offers by the holders of our Common Stock. Approval of the Proposed Amendments by holders of our Common Stock requires the affirmative vote of a majority of the votes entitled to be cast on the matter at the Special Meeting. Approval of the issuance of shares of Common Stock in the Exchange Offers at the Special Meeting requires a majority of the votes cast on the Stock Issuance Proposal at the Special Meeting.

The following is a summary of the Proposed Amendments and is qualified in its entirety by reference to the Charter and the amended text of the affected provisions of the Charter reflecting the Preferred B Articles of Amendment and the Preferred C Articles of Amendment, set forth in Annex A-1 and Annex A-2, respectively. The Proposed Amendments, if approved by our stockholders, would:

make all shares of Preferred B Stock that remain outstanding after the Exchange Offer closes redeemable by the Company in whole, and not in part, into the Preferred B Remainder Consideration, which is equal to (a) $3.00 in cash or, if payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions, thirty (30) shares of New Preferred Stock, and (b) 13.33 shares of Common Stock, by the date that is two (2) years after the Preferred B Amendment Effective Date;

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make all shares of Preferred C Stock that remain outstanding after the Exchange Offer closes redeemable by the Company in whole, and not in part, into the Preferred C Remainder Consideration, which is equal to (a) $0.10 in cash or, if payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions, one (1) share of New Preferred Stock, (b) 1.25 shares of Common Stock, and (c) 1.5 warrants to purchase 1.5 shares of Common Stock, subject to adjustment as described below to prevent the issuance of any fractional shares or warrants by the date that is two (2) years after the Preferred C Amendment Effective Date; and

We refer to any such redemption as contemplated by the Proposed Amendments as the Special Redemption). If any shares of Preferred B Stock or Preferred C Stock (not otherwise participating in the Exchange Offers) have still not been redeemed by the second (2nd) anniversary of the Amendment Effective Date, such shares will remain outstanding with all of their current rights, preferences and privileges.

No fractional shares of Common Stock or New Preferred Stock will be issued upon Special Redemption of any shares of Preferred Stock. In lieu of any fractional share of Common Stock or New Preferred Stock to be issued upon Special Redemption of any shares of Preferred Stock, any fraction of a share of Common Stock or New Preferred Stock will be rounded up to the next whole share of Common Stock or New Preferred Stock, as applicable. No fractional warrants will be issued upon the Special Redemption of any shares of Preferred C Stock. If a holder of Preferred C Stock would be entitled to receive a fractional warrant upon the Special Redemption of any shares of Preferred C Stock, the Company will round the warrant down to the nearest whole number of warrants to be issued.

Holders of shares of Preferred Stock redeemed pursuant to the Special Redemption will receive only the applicable Preferred Stock Remainder Consideration. We will have no obligation to pay or make allowance for, and we will not make any payment of or allowance for, the liquidation preference of, or any accrued and unpaid dividends on, any shares of Preferred Stock (whether or not

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such dividends have accumulated and whether or not such dividends accrued before or after the completion of the Exchange Offers) in connection with the repurchase of any shares of Preferred Stock in the Exchange Offers or the Special Redemption of any shares of Preferred Stock. The Special Redemption will not prejudice any person’s rights, if any, to receive amounts in connection with the Maryland Action.

If the holders of 662∕3% of the outstanding shares of each series of Preferred Stock have consented to the Exchange Offers and the Proposed Amendments and the holders of Common Stock approve the Proposed Amendments and the Stock Issuance Proposal at the Special Meeting in accordance with Maryland law, our Charter, our Bylaws and the rules of the NYSE American, we will file the Preferred B Articles of Amendment and the Preferred C Articles of Amendment with the SDAT to effect the Proposed Amendments promptly after the expiration of the Exchange Offers. The Company intends to complete the Special Redemption of any shares of Preferred B Stock and Preferred C Stock that remain outstanding after completion of the Exchange Offers no sooner than eleven (11) business days after the closing of the Exchange Offer relating to any such series of Preferred Stock and as soon as practicable thereafter.

For additional information regarding the Consent Solicitation, see “The Exchange Offers and the Consent Solicitation — Consent Solicitation Provisions.”

Reasons for the Exchange
Offers

The Exchange Offers are being conducted in order to improve our capital structure and eliminate our large and growing financial obligation to holders of our Preferred B Stock and the liquidation preference of the Preferred Holders, which we believe impede the growth and reduce strategic opportunities available to us.

Offer Consideration

The total consideration offered in the aggregate to all series of Preferred Stock, which we refer to herein as the Preferred Stock Consideration, is approximately (i) $2,137,285 in cash or approximately 21,372,846 shares of New Preferred Stock with an aggregate liquidation preference of $2,137,285 (exclusive of accumulated dividends) if paying cash would cause us to violate the Cash Consideration Restrictions; (ii) 10,630,918 newly issued shares of Common Stock; and (iii) for the holders of Preferred C Stock, warrants to purchase an additional 2,107,629 shares of Common Stock at a purchase price of $5.00 per share of Common Stock, in each case subject to adjustment for fractional shares. In addition, we expect to (i) pay approximately $1,331,184 in cash or issue approximately 13,311,840 shares of New Preferred Stock with an aggregate liquidation preference of $1,331,184 (exclusive of accumulated dividends) if paying cash would cause us to violate the Cash Consideration Restrictions, and (ii) issue 4,437,280 newly issued shares of Common Stock to constitute the Preferred B Common Fund pursuant to the Segregation Order.

Trading and Related Matters

We intend to list the Common Stock issuable in the Exchange Offers or upon Special Redemption of any Preferred Stock on the NYSE American. Neither the New Preferred Stock nor the warrants

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will be listed on any exchange and there will be no active secondary market for such securities.

Differences in Rights of Our Common Stock, Preferred Stock and New Preferred
Stock

The Preferred Stock, New Preferred Stock and Common Stock have different rights. For more information about these differences, see “The Exchange Offers and the Consent Solicitation — Comparison of Rights Between the Preferred Stock, the New Preferred Stock and the Common Stock.”

Terms of the New Preferred
Stock

If we issue New Preferred Stock in lieu of cash as a component of the Preferred Stock Consideration, the New Preferred Stock will (w) rank senior to the Preferred B Stock and Preferred C Stock as to dividends and upon liquidation, (x) be non-participating and bear cumulative cash dividends from and including the original issue date at a fixed rate equal to 8.25% per annum, (y) bear a liquidation preference of $0.10 per share, and (z) be mandatorily redeemable by us on (A) the sixtieth (60th) day, or such earlier date we may fix, after the date of any public announcement by us of annual or quarterly financial statements that indicate that payment of the redemption price would not cause us to violate the restrictions on payment of distributions to stockholders under section 2-311 of the MGCL unless, before such redemption date, our Board of Directors determines in good faith that our payment of the redemption price for the New Preferred Stock and for any stock ranking on parity with the New Preferred Stock with respect to redemption and which have become redeemable as of the applicable redemption date would cause us to violate the Cash Consideration Restrictions or (B) any date we fix not more than sixty (60) days after any determination by our Board of Directors (which the Board, or a committee thereof, is obligated to undertake after the release of annual and quarterly financial statements and upon any capital raise) in good faith that our payment of the redemption price for the New Preferred Stock and any stock ranking on parity with the New Preferred Stock with respect to redemption rights that have become redeemable as of such redemption date would not cause us to violate the Cash Consideration Restrictions. The New Preferred Stock will not be listed on any exchange. See “Description of Securities — New Preferred Stock.”

Terms of the Warrants

Each warrant will be exercisable at an exercise price of $5.00 per share of Common Stock beginning three (3) years from date of consummation of the Exchange Offer for the Preferred C Stock.

The warrants will expire at 5:00 p.m., New York City time ten (10) years after the date of consummation of the Exchange Offer for the Preferred C Stock. Warrants may be exercised only for a whole number of shares of Common Stock. We are not under any obligation to register the Common Stock issuable upon exercise of the warrants. If the Common Stock issuable upon exercise of the warrants is not registered at the time of exercise, holders of the warrants will be required to exercise the warrants on a “cashless basis,” by exchanging the warrants (in accordance with Section 3(a)(9) of the Securities Act of 1933, as amended (the “Securities Act”) or

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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 of our Common Stock over the warrant exercise price by (b) the fair market value of our Common Stock, as determined in accordance with the warrant. If our shares of Common Stock are at the time of any exercise of a warrant not listed on a national securities exchange such that it satisfies the definition of a “covered security” under Section 18(b)(1) of the Securities Act, we may, at our option, require holders of warrants who exercise their warrants to do so on a “cashless basis” in accordance with Section 3(a)(9) of the Securities Act. See “Description of Securities — Warrants.”

Market Price Information

On September 9, 2022, the last reported sales price of our Common Stock on the NYSE American was $0.45 per share, the last reported sales price of the Preferred B Stock on the OTC Pink was $9.55 per share and the last reported sales price of the Preferred C Stock on the OTC Pink was $1.06 per share.

Expiration Date

Each of the Exchange Offers and the Consent Solicitation will expire at 11:59 p.m., New York City time, on October 20, 2022, unless extended or terminated by us, in which case the term “Expiration Date” with respect to any Exchange Offer means the latest time and date on which the Exchange Offer and the Consent Solicitation for such series of Preferred Stock, as so extended, expires.

Settlement Date

The settlement date in respect of Preferred Stock validly surrendered and accepted for exchange in the Exchange Offers will occur at closing of the Exchange Offers. We expect the closing to be at least three (3) business days after the Expiration Date.

Conditions Precedent to the Exchange Offers

Our obligation to accept shares for exchange in each Exchange Offer is conditioned upon, among other things:

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satisfaction of each Individual Series Minimum Condition (defined below);

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approval of each of the Proposed Amendments by the holders of Common Stock entitled to cast a majority of the votes entitled to be cast on such proposals;

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approval of the Stock Issuance Proposal, by a majority of the votes cast on the proposal at the Special Meeting;

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the effectiveness of the Proposed Amendments;

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the effectiveness of the Registration Statement filed on Form S-4 filed with the SEC on July 15, 2022, as amended, pertaining to the Exchange Offers and the Consent Solicitation; and

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if we issue New Preferred Stock in lieu of cash, the effectiveness of Articles Supplementary setting forth the terms of the New Preferred Stock.

Among other conditions, consummation of the Exchange Offer for any series of Preferred Stock is conditioned on the holders of at least 662∕3% of the outstanding shares of each series of Preferred

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Stock consenting to the Exchange Offer and the Proposed Amendment relating to that series of Preferred Stock (the “Individual Series Minimum Condition”). The Company may close the Exchange Offer for any series of Preferred Stock only if the Exchange Offer for the other series of Preferred Stock also satisfies its Individual Series Minimum Condition and the Proposed Amendments become effective.

We will, subject to the rules and regulations of the SEC, in our reasonable judgment, determine whether any of the conditions to an Exchange Offers and the Consent Solicitation have been satisfied and whether to waive any conditions that have not been satisfied. We reserve the right to amend the Exchange Offer for any series of Preferred Stock for any reason in accordance with applicable law. We may terminate the Exchange Offer for any series of Preferred Stock for which any of the conditions have not been satisfied or waived. See “The Exchange Offers and the Consent Solicitation — Conditions of the Exchange Offers,” “The Exchange Offers and the Consent Solicitation — Extension, Termination and Amendment,” and “The Exchange Offers and the Consent Solicitation — Waiver of Conditions.”

Consequences of Failure to Exchange Outstanding Preferred Stock

Each Exchange Offer will not be consummated unless, among other things, holders of at least 662∕3% of the outstanding shares of each series of Preferred Stock consent to the Exchange Offer and the Proposed Amendment applicable to that series of Preferred Stock.

If the Exchange Offers for the Preferred B Stock and Preferred C Stock close, all shares of Preferred Stock that are not tendered in the Exchange Offers may be redeemed by the Company pursuant to the Special Redemption right for the Preferred Stock Remainder Consideration applicable to that series of Preferred Stock for a period of two (2) years after the applicable Amendment Effective Date. The Company intends to redeem the Preferred Stock pursuant to the Special Redemption right and pay the applicable Preferred Stock Remainder Consideration to the applicable non-tendering Preferred Holders as soon as reasonably practicable, but no sooner than eleven (11) business days, after the closing of the Exchange Offers. If the Company has not redeemed all of the outstanding shares of Preferred B Stock or Preferred C Stock for the Preferred B Remainder Consideration or the Preferred C Remainder Consideration, as the case may be, pursuant to the Special Redemption right within sixty-five (65) days after the applicable Amendment Effective Date, upon the written request of any holder of any outstanding share of Preferred B Stock or Preferred C Stock, as the case may be, which is made within two (2) years after the Amendment Effective Date, the Company must effect the Special Redemption for the applicable Preferred Stock Remainder Consideration of all outstanding shares of Preferred B Stock or Preferred C Stock, as applicable, on the date fixed by the Company within ninety (90) days of such request, subject to any delay required by the Company to comply with applicable Maryland law relating to limitations on payment of any cash portion of the Preferred Stock Remainder Consideration. If any shares of Preferred B Stock or Preferred C Stock (not otherwise participating in the Exchange Offers) have still not been redeemed by the second (2nd) anniversary

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of the Amendment Effective Date, such shares will remain outstanding with all of their current rights, preferences and privileges.

If holders of at least 662∕3% of the outstanding shares of each series of Preferred Stock do not consent to the Exchange Offers and the Proposed Amendments, or the holders of Common Stock do not approve the Proposed Amendments or Stock Issuance Proposal at the Special Meeting and the Company is not able to complete the Exchange Offers and the Consent Solicitation, we believe that there could be significant adverse consequences to the Company if the contemplated Exchange Offers and the related Special Redemptions of our Preferred B Stock and Preferred C Stock are not successfully completed. If the required approvals from holders of both the Preferred B Stock and Preferred C Stock, as well as the Common Stock are not received, and/or we are not able to otherwise complete the Exchange Offer and the related Special Redemptions, then we may not be able to meet our financial or business objectives. In light of the continuing turmoil in the mortgage market and rising interest rates, our ability to continue our operations is dependent upon our ability to raise capital, successfully implement our strategic initiatives and engage in operations that contribute sufficient additional cash flow to enable us to meet our current and future expenses. Our future financial performance and success are dependent in large part upon our ability to implement our contemplated strategies successfully. Our ability to raise future capital may be dependent on third parties who, in the past, have either been hesitant to lend or invest in the Company due to the capital structure of the Company, including the Preferred B Stock and Preferred C Stock, or have offered terms which our Board of Directors has determined are not in our best interests. To the extent the Exchange Offers and the related Special Redemptions are not successful in eliminating our outstanding Preferred Stock, we may be unable to raise the additional capital required to permit us to implement our strategic initiatives and continue our operations as planned, thereby requiring us to further reduce our operating costs and expenses so that our income can cover those costs and expenses.

If we are not able to complete the Exchange Offers and the related Special Redemptions and improve our near-term liquidity, we also will need to consider other restructuring alternatives available to us at that time. Those alternatives may include, but are not limited to, (i) the transfer of certain of our assets to our lenders to fulfill our obligations, (ii) the sale of profitable assets or of the Company, (iii) a distribution or spin-off of profitable assets, (iv) liquidation or distribution of our assets, (v) alternative offers to exchange our outstanding securities and debt obligations, (vi) the incurrence of additional debt, (vii) obtaining additional equity capital on terms that may be onerous or highly dilutive, and/or (viii) joint ventures.

In addition, the holders of our outstanding $15 million in Convertible Debt have extended the maturity date of the Convertible Debt until May 9, 2025 (with three principal payments of $5 million on each of May 9, 2023, May 9, 2024 and May 9, 2025), conditioned on our completion of the Exchange Offers and providing notice of redemption of the remaining Preferred Stock by October 31, 2022. If we do not complete the Exchange Offers and provide such notice, the Convertible Debt will be due on

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November 9, 2022, which also could have a material adverse effect on our business and financial position.

For a more complete description of the risks relating to our failure to complete the Exchange Offers, see “Risk Factors.”

Plans and Proposals

We expect to fund the cash portion of the Cash/New Preferred Stock Portions in the Exchange Offers and the cash portion of the Preferred Stock Remainder Consideration (if we pay cash as part of the Exchange Offers) with cash on hand. In addition, the holders of our outstanding $15 million in Convertible Debt have extended the maturity date of the Convertible Debt until May 9, 2025 (with three (3) principal payments of $5 million on each of May 9, 2023, May 9, 2024 and May 9, 2025), conditioned on our completion of the Exchange Offers and providing notice of redemption of the remaining Preferred Stock by October 31, 2022. If we do not complete the Exchange Offers and provide such notice, the Convertible Debt will be due on November 9, 2022.

We do not otherwise, with the exception of the Exchange Offers and the extension of the maturity date on our Convertible Debt, have any plans, proposals or negotiations that would result in any material change in our corporate structure or business. We do not have any plans, proposals or negotiations which would relate to or result in our Common Stock becoming eligible for termination of registration under Section 12(g)(4) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”).

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THE SPECIAL MEETING

TO BE HELD ON
OCTOBER 20, 2022 AT 9:00 A.M. (PACIFIC DAYLIGHT TIME)

To the Holders of Our Common Stock:

This Proxy Statement is being furnished in connection with the solicitation of proxies on behalf our Board of Directors to be voted at the Special Meeting of the holders of our Common Stock, to be held on October 20, 2022, at 9:00 a.m. (Pacific Daylight Time). The Special Meeting will be a virtual meeting via live audio webcast on the Internet. We anticipate that this Proxy Statement and the form of proxy relating to our Special Meeting will be mailed to our stockholders on or about September 16, 2022.

The Special Meeting is being held in connection with the Company’s offers (referred to herein as the Exchange Offers) to the holders of the outstanding shares of the Company’s 9.375% Series B Cumulative Redeemable Preferred Stock, par value $0.01 per share, referred to herein as the Preferred B Stock, and the Company’s 9.125% Series C Cumulative Redeemable Preferred Stock, par value $0.01 per share, referred to herein as the Preferred C Stock, to exchange all of the outstanding shares of Preferred Stock for (a) shares of the Company’s Common Stock, (b) cash or, if we are prohibited from paying cash as described herein, shares of the Company’s Series D Cumulative Redeemable Preferred Stock, par value $0.01 per share, referred to herein as the New Preferred Stock, whichever is paid in the Exchange Offers, and, solely with respect to the Exchange Offer for the Preferred C Stock, (c) warrants to purchase shares of Common Stock. The Exchange Offers are being made pursuant to separate documents that have been delivered to the Preferred Holders. It is a condition to the consummation of the Exchange Offers that the holders of our Common Stock vote on, and approve, the matters described in this Proxy Statement.

Proposals to be Considered at the Special Meeting

The following proposals will be presented to the stockholders entitled to vote thereon for consideration at the Special Meeting:

Proposal 1 (Preferred B Charter Amendment Proposal) — To approve a proposal to amend our Charter to (i) permit the closing of the Exchange Offers (including the authorization and issuance of the New Preferred Stock without a separate vote of the holders of Preferred B Stock) and (ii) make all shares of Preferred B Stock that remain outstanding after the Exchange Offer for the Preferred B Stock closes redeemable by the Company in whole, and not in part, into the same Preferred B Consideration that holders of Preferred B Stock who participate in the Exchange Offer received, which is equal to (a) $3.00 in cash or if the payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions thirty (30) shares of New Preferred Stock and (b) 13.33 shares of the Company’s Common Stock (referred to herein collectively as the Preferred B Remainder Consideration), in each case, without payment of, or allowance for, any accrued and unpaid dividends on any shares of Preferred B Stock (whether or not such dividends have accumulated and whether or not such dividends accrued before or after the completion of the Exchange Offers), on the terms of the proposed amendment to the Charter as set forth on Annex A-1 (referred to herein as the Preferred B Proposed Amendment), but only if at least 662∕3% of the outstanding shares of Preferred B Stock consent to the Exchange Offer for the Preferred B Stock and the Preferred B Proposed Amendment;

Proposal 2 (Preferred C Charter Amendment Proposal) — To approve a proposal to amend our Charter to (i) permit the closing of the Exchange Offers (including the authorization and issuance of the New Preferred Stock without a separate vote of the holders of Preferred C Stock) and (ii) make all shares of Preferred C Stock that remain outstanding after the Exchange Offer for the Preferred C Stock closes redeemable by the Company in whole, and not in part, into the same Preferred C Consideration that holders of Preferred C Stock who participate in the Exchange Offer received, which is equal to (x) $0.10 in cash or, if the payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions, one (1) share of New Preferred Stock, (y) 1.25 shares of the Company’s Common Stock, and (z) 1.5 warrants to purchase 1.5 shares of the Company’s Common Stock, subject to adjustment as described herein to prevent the

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issuance of any fractional shares or warrants (referred to herein collectively as the Preferred C Remainder Consideration), on the terms of the form of proposed amendment to the Charter set forth as Annex A-2 to this Proxy Statement (referred to herein as the Preferred C Proposed Amendment), but only if at least 662∕3% of the outstanding shares of Preferred C Stock, consent to the Exchange Offer for the Preferred C Stock and the Preferred C Proposed Amendment;

Proposal 3 (Stock Issuance Proposal) — To approve, in accordance with 713(a) of the NYSE American Company Guide, our issuance of up to 15,500,000 shares of Common Stock (including up to 4,437,280 shares of Common Stock which may be issued to comprise a portion of the Preferred B Common Fund), and up to 2,107,629 warrants to purchase Common Stock in connection with the Exchange Offers; and

Proposal 4 (Adjournment Proposal) — To approve a proposal to approve the adjournment of the Special Meeting to a later date or date(s), if necessary, to permit further solicitation and vote of proxies in the event that there are insufficient votes for, or otherwise in connection with, the approval of Proposal 1, Proposal 2 and/or Proposal 3.

Collectively, these proposals will be referred to herein as the “Proposals.”

The Adjournment Proposal (Proposal 4) will only be presented at the Special Meeting if there are insufficient votes to approve the Preferred B Charter Amendment Proposal (Proposal 1), the Preferred C Charter Amendment Proposal (Proposal 2), and/or the Stock Issuance Proposal (Proposal 3).

As described in the subsections titled “Record Date and Voting Rights,” “Voting Requirements and Procedures” and “Quorum and Counting of Votes” below, as a holder of Common Stock you will be entitled to vote on all business properly brought before the Special Meeting, including each of the Proposals.

Reasons for the Special Meeting and Consideration of the Proposals

As described below in the “Background of the Exchange Offers and the Consent Solicitation” section of this Proxy Statement, the Company’s offers (referred to herein as the Exchange Offers) to exchange all of the outstanding shares of each series of our Preferred Stock for aggregate consideration of approximately (i) $2,137,285 in cash or 21,372,846 shares of New Preferred Stock with an aggregate liquidation preference of $2,137,285 (exclusive of accumulated dividends) if payment of cash in the Exchange Offers would cause us to violate the Cash Consideration Restrictions; (ii) 10,630,918 newly issued shares of Common Stock; and (iii) for holders of Preferred C Stock, warrants to purchase up to an additional 2,107,629 shares of Common Stock at a purchase price of $5.00 per share of Common Stock, is part of the Company’s recapitalization to improve the Company’s capital structure. If the Exchange Offers are consummated, assuming all shares of Preferred Stock participate, approximately $19.9 million in accumulated and unpaid dividends on the Preferred B Stock (through June 30, 2022) will not be paid, no further dividends on the Preferred Stock will accumulate or be paid, and the Preferred Stock will be eliminated, including its liquidation preferences. The exchange of the Preferred B Stock as contemplated by the Exchange Offers will not prejudice any person’s rights, if any, to receive amounts in connection with the Maryland Action.

In order to effectuate the Exchange Offers, Proposal 1, Proposal 2 and Proposal 3 must be approved by the holders of our Common Stock entitled to vote on each Proposal as required by Maryland law, our Charter, our Bylaws and the rules of the NYSE American. In addition, Proposal 4, if adopted, will allow our Board of Directors to adjourn the Special Meeting to a later date or date(s) to permit the further solicitation of proxies. See “Proposal 1 — Preferred B Charter Amendment Proposal,” “Proposal 2 — Preferred C Charter Amendment Proposal,” “Proposal 3 — Stock Issuance Proposal,” and “Proposal 4 — Adjournment Proposal” for the full description of the reasons for and effects of each Proposal.

Registering to Attend the Special Meeting

To register to attend the Special Meeting, please visit http://www.viewproxy.com/ImpacCompanies/2022SM/htype.asp. ALL REGISTRATIONS MUST BE RECEIVED BY 11:59 P.M. PACIFIC DAYLIGHT TIME, ON OCTOBER 18, 2022.

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If you own shares of our Common Stock registered in your name on the books of our transfer agent, as of the close of business on the Record Date, please click “Registration for Registered Holders” and enter your name, address and phone number.

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If you hold shares of our Common Stock in an account at a broker, bank, trust or other nominee as of the close of business on the Record Date, please click “Registration for Beneficial Holders” and enter your name, phone number and email, and click submit. If you wish to vote electronically at the Special Meeting, please upload during registration or email a copy of your legal proxy that you have obtained from your bank or broker to virtualmeeting@viewproxy.com.

If you have already authorized a proxy or provided voting instructions by returning a signed proxy card, or by following the instructions provided by your bank, broker or other nominee, you do not need to register or attend the Special Meeting in order for your vote to be counted.

After you have registered for the Special Meeting, you will receive an email indicating that your registration has been confirmed along with the meeting password. You will need this password in order to virtually attend the Special Meeting.

Voting Requirements & Procedures

Your vote is important. If you are not planning on attending the Special Meeting to vote your shares virtually via the Internet, your shares of Common Stock cannot be voted until either a signed proxy card is returned to the Company or voting instructions are submitted by using the Internet or by calling a specifically designated telephone number. To give the Company the power to vote your shares of Common Stock at the Special Meeting, the proxy card that accompanies this Proxy Statement should be returned to the Company in the enclosed return envelope. Specific instructions for holders of record of Common Stock who wish to use the Internet or telephone voting procedures are set forth on the proxy card.

Shares of Common Stock represented by properly executed proxies received in time for the Special Meeting will be voted in accordance with the choices specified in the proxies. Unless contrary instructions are indicated on the proxy:

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shares of Common Stock will be voted FOR Proposal 1, the Preferred B Charter Amendment Proposal;

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shares of Common Stock will be voted FOR Proposal 2, the Preferred C Charter Amendment Proposal;

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shares of Common Stock will be voted FOR Proposal 3, the Stock Issuance Proposal; and

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shares of Common Stock will be voted FOR Proposal 4, the Adjournment Proposal (if presented).

The Adjournment Proposal will only be presented at the Special Meeting if there are insufficient votes to approve one or more of the other Proposals.

The Board of Directors recommends that the holders of Common Stock vote “FOR” each of the Proposals. The Company’s management and the Board of Directors know of no matters to be brought before the Special Meeting other than as set forth herein. Because this is a Special Meeting of stockholders called by the Board of Directors, under our Bylaws, the only matters that may properly be brought before the meeting are those items designated in the notice of Special Meeting. Our stockholders do not have the ability to bring any matters before this Special Meeting.

Record Date and Voting Rights

Our only outstanding voting equity securities entitled to vote at the Special Meeting are shares of our Common Stock. Each share of Common Stock entitles the holder to one vote. Only holders of record of Common Stock at the close of business on the Record Date are entitled to notice of and to vote at the Special

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Meeting and any adjournment of the Special Meeting. On the Record Date, approximately 21,500,935 shares of Common Stock were outstanding and entitled to vote on each of the Proposals. This Proxy Statement only solicits proxies from the holders of Common Stock.

Quorum and Counting of Votes

Holders of our Common Stock of record at the close of business on the Record Date will be entitled to vote at the Special Meeting or any adjournment or postponement thereof. Each share of our Common Stock is entitled to one vote and the presence, either virtually via the Internet or by proxy, of holders of a majority of the outstanding shares of our Common Stock is necessary to constitute a quorum for the Special Meeting.

The affirmative vote of the holders Common Stock entitled to cast a majority of the votes entitled to be cast on each proposal will be required to approve each of Proposal 1 and Proposal 2. Proposal 3 and Proposal 4 (if presented) must each be approved by the affirmative vote of a majority of votes cast on such proposal, assuming a quorum is present. The approval of the holders of Preferred Stock is not required to approve any of the Proposals, but the consent to the Exchange Offer and the Proposed Amendments related to a series of Preferred Stock by the holders of at least 662∕3% of that series of Preferred Stock is a condition to the effectiveness of the Proposed Amendments related to such series of Preferred Stock.

Abstentions and broker non-votes will be considered present and entitled to vote for the purpose of determining the presence of a quorum. Because the required vote for approval of Proposal 1 and Proposal 2 is based on all shares entitled to vote on each such proposal at the Special Meeting, abstentions and broker non-votes, if any are received, will act as a vote “AGAINST” Proposal 1 or Proposal 2 (as appliable), but your abstention or failure to give instructions on Proposal 3 or Proposal 4 will have no effect on the outcome of Proposal 3 or Proposal 4, respectively.

If you sign and return your proxy card without giving specific voting instructions, your shares will be voted consistent with the Board of Director’s recommendations.

Abstentions and Broker Non-Votes

An abstention is the voluntary act of not voting by a stockholder who is present at the Special Meeting and entitled to vote. A broker “non-vote” is a proxy submitted by a broker that does not indicate a vote for some or all of the proposals because the broker does not have discretionary voting authority on certain types of proposals that are non-routine matters and has not received instructions from its customer regarding how to vote on a particular proposal. Brokers that hold shares of Common Stock in “street name” for customers that are the beneficial owners of those shares may generally vote on routine matters. However, brokers generally do not have discretionary voting power (i.e., they cannot vote) on non-routine matters (which is the case with respect to each of the Proposals) without specific instructions from their customers. Proposals are determined to be routine or non-routine matters based on the rules of the various regional and national exchanges of which the brokerage firm is a member.

Because the required vote for approval on Proposal 1 and Proposal 2 is based on all shares entitled to be cast at the Special Meeting, abstentions and broker non-votes will act as a vote “AGAINST” Proposal 1 or Proposal 2 (as applicable). Abstentions and broker non-votes will have no effect on Proposal 3 or Proposal 4 unless a quorum is not present at the Special Meeting.

Revocability of Proxy

Any proxy given may be revoked at any time prior to its exercise by notifying the Corporate Secretary of the Company in writing of such revocation, by duly executing and delivering another proxy bearing a later date (including an Internet or telephone vote), or by attending the Special Meeting and voting virtually via the Internet.

Interest of Executive Officers and Directors and Greater than 5% Stockholders

None of the Company’s executive officers, directors or greater than five percent (5%) stockholders have any interest in any of the matters to be acted upon at the Special Meeting except as described below. As of

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the September 6, 2022, Todd M. Pickup and Richard H. Pickup, and their respective affiliates (collectively, the “Pickups”) beneficially owned approximately 13.1% and 30.4%, respectively, of our outstanding Common Stock. Their beneficial ownership includes 296,512 shares and 401,163 shares of our Common Stock that Todd Pickup and Richard Pickup, respectively, has the right to acquire at any time by converting the outstanding $15.0 million in principal balance of Convertible Debt at the initial conversion price of $21.50 per share. Additionally, their beneficial ownership also includes 85,060 and 116,957 warrants that Todd Pickup and Richard Pickup, respectively, has the right to acquire at any time by converting the warrants that expire April 15, 2025, at a cash exercise price of $2.97 per share. The Pickups, as the holders of our outstanding $15 million in Convertible Debt, have extended the maturity date of the Convertible Debt until May 9, 2025 (with three (3) principal payments of $5 million on each of May 9, 2023, May 9, 2024 and May 9, 2025), conditioned on our completion of the Exchange Offers and providing notice of redemption of the remaining Preferred Stock by October 31, 2022. If we do not complete the Exchange Offers and provide such notice, the maturity date of the Convertible Debt owed to the Pickups will be accelerated to November 9, 2022. Accordingly, the Pickups have an interest in the matters to be acted upon at the Special Meeting separate and apart from other holders of our Common Stock.

To our knowledge, none of our executive officers or directors or holders of more than five percent (5%) of our outstanding Common Stock hold any shares of our outstanding Preferred Stock.

Householding

“Householding” is a program, approved by the SEC, which allows companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for proxy statements and annual reports by delivering only one package of stockholder proxy materials to any household at which two or more stockholders reside. If you and other residents at your mailing address own shares of our common stock in “street name,” your broker or bank may have notified you that your household will receive only one copy of our proxy materials. Once you have received notice from your broker that they will be “householding” materials to your address, “householding” will continue until you are notified otherwise or until you revoke your consent. If, at any time, you no longer wish to participate in “householding” and would prefer to receive a separate proxy statement, or if you are receiving multiple copies of the proxy statement and wish to receive only one, please notify your broker if your shares are held in a brokerage account. If you hold shares of Common Stock in your own name as a holder of record, “householding” will not apply to your shares.

Adjournment of Special Meeting

If a quorum is not present or represented, our Bylaws permit the stockholders entitled to vote at the Special Meeting, either attending virtually via the Internet or represented by proxy, to adjourn the Special Meeting from time to time to a date not more than 120 days after the original record date without notice other than the announcement at the Special Meeting.

Appraisal Rights and the Right of Petition for Fair Value

No Company stockholder will have appraisal rights with respect to any matter to be acted upon at the Special Meeting.

Further, no Company stockholder will have any rights of objecting stockholders or any contract right to petition for fair value with respect to any matter to be acted upon at the Special Meeting. The Company will not independently provide such a right. Under section 3-202(a)(4) of the MGCL, stockholders generally have the right to petition for fair value when the charter is amended in a way that substantially affects the stockholders’ rights and alters the contract rights as expressly set forth in the charter. However, section 3-202(a)(4) of the MGCL provides an exception from this general rule when the charter reserves the power to amend the charter to alter contract rights. Article VIII of the Charter expressly reserves the power to amend the Charter to alter the contract rights of existing stockholders, including alterations that are substantially adverse. Further, the Proposed Amendments do not alter the contract rights of the Common Stock.

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Proxy Solicitor

The Company may retain D.F. King & Co., a proxy solicitation firm, to assist with the solicitation of proxy votes. We will bear the expense of soliciting proxies for the Special Meeting, including reimbursement of forwarding expenses and fees and expenses of the proxy solicitor. Additional solicitations may be made by personal interview, mail, telephone, e-mail or facsimile. We will reimburse banks, brokerage firms, other custodians, nominees and fiduciaries for reasonable expenses incurred in sending proxy materials to beneficial owners of our Common Stock. The Company’s officers and directors may also solicit proxies directly and through telephone, mail and email.

Attendance at Special Meeting

The Company anticipates that a representative of Baker Tilly US, LLP, the Company’s independent registered public accounting firm, will attend the Special Meeting. The representative will have an opportunity to make a statement and to respond to appropriate stockholder questions.

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PROPOSAL NO. 1

PREFERRED B CHARTER AMENDMENT PROPOSAL

General

In connection with the Exchange Offers, the Board of Directors has declared advisable and recommended for stockholder approval the Preferred B Proposed Amendment. The Preferred B Proposed Amendment attached to this Proxy Statement as Annex A-1 amends the Charter by (i) permitting the closing of the Exchange Offers (including the authorization and issuance of the New Preferred Stock without a separate vote of the holders of Preferred B Stock) and (ii) making all shares of Preferred B Stock that remain outstanding after the Exchange Offer for the Preferred B Stock closes redeemable by the Company in whole, and not in part, into the Preferred B Remainer Consideration, which is equal to (a) $3.00 in cash or, if the payment of cash in the Exchange Offers would cause the Company to violate the Cash Consideration Restrictions, thirty (30) shares of New Preferred Stock, whichever is paid in the Exchange Offer, and (b) 13.33 shares of Common Stock, but only if holders of at least 662∕3% of the outstanding shares of Preferred B Stock consent to the Preferred B Proposed Amendment. The following description is qualified in its entirety by reference to the Preferred B Articles of Amendment attached to this Proxy Statement as Annex A-1.

The Exchange Offers and the other transactions described herein, including the Preferred B Proposed Amendment, will not occur if the Preferred B Proposed Amendment is not approved at the Special Meeting.

Elimination of Preferred B Stock

If the Exchange Offers and transactions contemplated thereby are approved and effected, the holders of Preferred B Stock electing to tender in the Exchange Offers will exchange their shares of Preferred B Stock for the consideration identified below:

Security			Shares Outstanding			Cash/New Preferred Stock Portion			Common Stock Portion
Preferred B Stock			665,592			$3.00 in cash or, if payment of cash would cause us to violate the Cash Consideration Restrictions, thirty (30) shares of New Preferred Stock, as more fully described herein.			13.33 shares of Common Stock, as more fully described herein.

If Proposal 1 is approved and the Exchange Offer for the Preferred B Stock closes, any shares of Preferred B Stock that are not tendered and accepted for exchange will be redeemable, in whole, but not in part, by the Company into (a) $3.00 in cash or, if New Preferred Stock was paid in the Exchange Offer, thirty (30) shares of New Preferred Stock, and (b) 13.33 shares of Common Stock (referred to herein collectively as the Preferred B Remainder Consideration) for up to two (2) years following the Preferred B Amendment Effective Date.

No fractional shares of Common Stock or New Preferred Stock will be issued upon completion of the Exchange Offers or Special Redemption of any shares of Series B Preferred Stock. In lieu of any fractional share of Common Stock or New Preferred Stock to be issued upon completion of the Exchange Offers or Special Redemption of any shares of Series B Preferred Stock, any fraction of a share of Common Stock or New Preferred Stock will be rounded up to the next whole share of Common Stock or New Preferred Stock, as applicable.

The Company will have no obligation to pay or make allowance for, and will not make any other payment or allowance for, the liquidation of, or any accrued and unpaid dividends on, any shares of Preferred Stock (whether or not such dividends have accumulated and whether or not such dividends accrued before or after the completion of the Exchange Offers) in connection with the repurchase of any shares of Preferred Stock pursuant to the Exchange Offers or upon the Special Redemption of any

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Preferred Stock. Neither the exchange of the Preferred B Stock as contemplated by the Exchange Offers nor the Special Redemption will prejudice any person’s rights, if any, to receive amounts in connection with the Maryland Action.

The terms of the Preferred B Stock are described under “Description of Securities — Preferred B Stock and Preferred C Stock.” The terms of the Common Stock are described under “Description of Securities — Common Stock.” The Preferred B Stock and Common Stock have different rights. For more information about these differences, see “The Exchange Offers and the Consent Solicitation — Comparison of Rights between the Preferred Stock, the New Preferred Stock and the Common Stock.”

The Board of Directors reserves the right not to elect to implement the Preferred B Proposed Amendment or any portion thereof, notwithstanding stockholder approval thereof, if it determines, in its sole discretion, that the Preferred B Proposed Amendment, or any portion thereof, is no longer needed to consummate the Exchange Offer for the Preferred B Stock or is no longer in the best interests of the Company.

Vote Required

The affirmative vote of the holders of Common Stock entitled to cast a majority of the votes entitled to be cast on the Preferred B Charter Amendment Proposal is required to approve Preferred B Proposed Amendment.

Board of Directors Recommendation

After careful consideration, the Board of Directors determined that the Preferred B Proposed Amendment is advisable and directed that it be submitted to the holders of the Company’s Common Stock for their approval. The Board of Directors recommends that the holders of the Company’s Common Stock vote in favor of the Preferred B Charter Amendment Proposal.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE
“FOR”
THE PREFERRED B CHARTER AMENDMENT PROPOSAL

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PROPOSAL NO. 2

PREFERRED C CHARTER AMENDMENT PROPOSAL

General

In connection with the Exchange Offers, the Board of Directors has declared advisable and recommended for stockholder approval the Preferred C Proposed Amendment. The Preferred C Proposed Amendment attached to this Proxy Statement as Annex A-2 amends the Charter by (i) permitting the closing of the Exchange Offers (including the authorization and issuance of the New Preferred Stock without a separate vote of the holders of Preferred C Stock) and (ii) making all shares of Preferred C Stock that remain outstanding after the Exchange Offer closes redeemable by the Company in whole, and not in part, into the Preferred C Remainder Consideration, which is equal to (a) $0.10 in cash or, if the payment of cash in the Exchange Offers would cause the Company to violate the Cash Consideration Restrictions, one (1) share of New Preferred Stock, whichever is paid in the Exchange Offer, (b) 1.25 shares of the Company’s Common Stock and (c) 1.5 warrants to purchase 1.5 shares of the Company’s Common Stock, subject to adjustment as described herein to prevent the issuance of any fractional shares or warrants, but only if holders of at least 662∕3% of the outstanding shares of Preferred C Stock consent to the Preferred C Proposed Amendment. The following description is qualified in its entirety by reference to the proposed Preferred C Articles of Amendment attached to this Proxy Statement as Annex A-2.

The Exchange Offers and the other transactions described herein, including the Preferred C Proposed Amendment, will not occur if the Preferred C Proposed Amendment is not approved at the Special Meeting.

Elimination of Preferred C Stock

If the Exchange Offers and transactions contemplated thereby are approved and effected, the holders of Preferred C Stock electing to tender in the Exchange Offers will exchange their shares of Preferred C Stock for the consideration identified below:

Security			Shares Outstanding			Cash/New Preferred Stock Portion			Common Stock Portion
Preferred C Stock			1,405,086			$0.10 in cash or, if payment of cash would cause us to violate the Cash Consideration Restrictions, one (1) share of New Preferred Stock, subject to adjustment as described herein to prevent the issuance of fractional shares.			1.25 shares of Common Stock and 1.5 warrants to purchase 1.5 shares of Common Stock at a purchase price of $5.00 per share, subject to adjustment as described herein to prevent the issuance of fractional shares or warrants.

If Proposal 2 is approved and the Exchange Offer for the Preferred C Stock closes, any shares of Preferred C Stock that are not tendered and accepted for exchange will be redeemable, in whole, but not in part, by the Company into (a) $0.10 in cash or, if New Preferred Stock was paid in the Exchange Offer, one (1) share of New Preferred Stock, (b) 1.25 shares of the Company’s Common Stock and (c) 1.5 warrants to purchase 1.5 shares of the Company’s Common Stock, subject to adjustment as described herein to prevent the issuance of fractional shares of warrants (referred to herein collectively as the Preferred C Remainder Consideration) for up to two (2) years following the Preferred C Amendment Effective Date.

No fractional shares of Common Stock or New Preferred Stock will be issued upon completion of the Exchange Offers or Special Redemption of any shares of Preferred C Stock. In lieu of any fractional share of Common Stock or New Preferred Stock to be issued upon completion of the Exchange Offers or Special Redemption of any shares of Preferred C Stock, any fraction of a share of Common Stock or New Preferred Stock will be rounded up to the next whole share of Common Stock or New Preferred Stock, as applicable. No fractional warrants will be issued in upon Special Redemption of any shares of Preferred C Stock. If a holder of Preferred C Stock would be entitled to receive a fractional warrant upon Special

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Redemption of any shares of Preferred C Stock, the Company will round the warrant down to the near whole number of warrants to be issued.

The terms of the Preferred C Stock are described under “Description of Securities — Preferred B Stock and Preferred C Stock.” The terms of the Common Stock are described under “Description of Securities — Common Stock.” The Preferred C Stock and Common Stock have different rights. For more information about these differences, see “The Exchange Offers and the Consent Solicitation — Comparison of Rights Between the Preferred Stock, the New Preferred Stock and the Common Stock.”

The Board of Directors reserves the right not to elect to implement the Preferred C Proposed Amendment or any portion thereof, notwithstanding stockholder approval thereof, if it determines, in its sole discretion, that the Preferred C Proposed Amendment, or any portion thereof, is no longer needed to consummate the Exchange Offer for the Preferred C Stock or is no longer in the best interests of the Company.

Vote Required

The affirmative vote of the holders of Common Stock entitled to cast a majority of the votes entitled to be cast on the Preferred C Charter Amendment Proposal is required to approve the Preferred C Proposed Amendment.

Board of Directors Recommendation

After careful consideration, the Board of Directors determined that the Preferred C Proposed Amendment is advisable and directed that it be submitted to the holders of the Company’s Common Stock for their approval. The Board of Directors recommends that the holders of the Company’s Common Stock vote in favor of the Preferred C Charter Amendment Proposal.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE
“FOR”
THE PREFERRED C CHARTER AMENDMENT PROPOSAL

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PROPOSAL NO. 3

STOCK ISSUANCE PROPOSAL

General

In connection with the Exchange Offers, the Board of Directors has recommended for stockholder approval the Stock Issuance Proposal. Pursuant to the Exchange Offers, the Company is offering to issue up to 10,630,918 shares of our Common Stock (and, if the Exchange Offers close, up to 4,437,280 shares of Common Stock which may be issued pursuant to the Segregation Order to comprise a portion of the Preferred B Common Fund as described herein), and up to 2,107,629 warrants to purchase Common Stock, which would be in excess of 20% of our outstanding Common Stock prior to the issuance, upon the terms and conditions more fully described below. The exact number of shares of Common Stock to be issued in the Exchange Offers will depend on the aggregate amount of shares of Preferred Stock tendered in the Exchange Offers in exchange for the Common Stock Portions. Any shares of Common Stock and warrants not issued in the Exchange Offers would be issued to the holders of the Preferred B Stock and Preferred C Stock, as applicable, as part of the Preferred Stock Remainder Consideration, assuming the Exchange Offers are consummated.

Our Common Stock is listed on the NYSE American and, as a result, we are subject to the rules and regulations of the NYSE American. Although we do not know the exact number of shares of Common Stock to be issued in the Exchange Offers, it is likely that the consummation of the Exchange Offers will result in the issuance of more than 20% of our currently outstanding Common Stock. As a result, stockholder approval of the issuance is required by Rule 713(a) of the NYSE American Company Guide. Rule 713(a) of the NYSE American Company Guide requires an issuer to obtain stockholder approval prior to the issuance of common stock, or of securities convertible into or exercisable for common stock, in any transaction or series of related transactions, if (i) the issuance of common stock at a price less than the greater of book or market value which together with sales by officers, directors or principal stockholders of the issuer equals 20% or more of the common stock outstanding before the issuance, or (ii) the issuance of common stock is equal to or more than 20% of presently outstanding common stock for less than the greater of book or market value of the stock.

Our Board of Directors believes that authorizing the issuance of the shares of Common Stock (and Common Stock issuable upon exercise of the warrants) in connection with the Exchange Offers is in the best interests of the Company because consummation of the Exchange Offers is intended to improve our capital structure and eliminate the Company’s large and growing financial obligation to its Preferred Holders, which the Company believes impede the growth and reduce strategic opportunities available to it.

Authorizing the issuance of the shares of Common Stock (and Common Stock issuable upon exercise of the warrants) will not ensure that we will be able to complete the Exchange Offers or that if we make such an offer, it will be accepted by holders of each series of the Preferred Stock. Approval will, however, allow us to undertake such a transaction. Approval of the issuance of our Common Stock will not affect the rights of the holders of currently outstanding shares of Common Stock, except for effects incidental to increasing the number of shares of our Common Stock outstanding, such as dilution of any earnings per share and voting rights.

If our stockholders vote to approve the issuance of the shares of Common Stock, we plan to conduct the Exchange Offers on the terms and conditions set forth in the Registration Statement on Form S-4. In addition, we intend to file with the NYSE American an application to list the shares of Common Stock (and Common Stock issuable upon exercise of the warrants) issued in connection with the Exchange Offers. Neither the New Preferred Stock nor the warrants will be listed on the NYSE American or any other securities exchange, and there will be no active secondary market for such securities.

The shares of Common Stock issued would dilute the percentage ownership of the holders of Common Stock currently outstanding, and their resale could have an adverse effect on the trading price of our Common Stock. There are no impediments to the immediate resale of the newly issued shares, which may have a further adverse effect on the trading price of our Common Stock, provided, however, as of September 6, 2022, holders of 68.0% our outstanding Preferred B Stock and 64.6% of our outstanding Preferred C Stock

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have agreed, as part of voting agreements they have entered into in connection with the Exchange Offers, that, with respect to shares of Preferred Stock or Common Stock over which they are the beneficial owner or have discretionary voting authority over (including shares of Common Stock acquired upon consummation of the Exchange Offers or by redemption) (collectively, “Covered Shares”), that without the prior written consent of the Company and except for certain permissible transfers, they will not transfer or otherwise sell any Covered Shares except, beginning on the date that is six (6) months after the first date after which both the Exchange Offers have closed and the Proposed Amendments have been filed with the SDAT (the “Closing Time”) and ending on the date that is the third (3rd) annual anniversary of the first date on which the Closing Time occurs (the “Selling Period”), such stockholder may transfer on any day during an ADTV Period, as defined below, a number of Covered Shares that does not exceed the greater of (i) 50,000 Covered Shares and (ii) ten percent (10%) of the most recently determined ADTV (as defined below); provided, however, that the maximum number of Covered Shares that may be transferred by such holder during any particular ADTV Period pursuant to clause (ii) may not exceed, in the aggregate, the product of (x) ten percent (10%) of the most recently determined ADTV and (y) the number of actual trading days during such ADTV Period.

For purposes of the voting agreement, “ADTV” means, as of any date, the average daily trading volume of the Common Stock on the principal exchange on which our Common Stock is then listed or admitted for trading during the three (3) month period ending on the trading date immediately preceding the date on which ADTV is calculated, and “ADTV Period” means the period beginning on the most recent date on which ADTV has been calculated and ending on the day before the next date on which ADTV will be calculated.

The Board of Directors reserves the right to amend the Exchange Offers or to not complete the Exchange Offers, notwithstanding stockholder approval thereof, if it determines, in its sole discretion, that the issuance of Common Stock, or any portion thereof, is no longer needed to consummate the Exchange Offers or that the issuance of Common Stock or the Exchange Offers are no longer in the best interests of the Company.

Vote Required

Assuming a quorum is present, the affirmative vote of a majority of the votes cast on the Stock Issuance Proposal is required to approve the Stock Issuance Proposal. Abstentions and broker non-votes will have no effect on the outcome of the Stock Issuance Proposal. The approval of the Preferred Holders is not required to approve the Stock Issuance Proposal under Rule 713(a) of the NYSE American Company Guide.

Board of Directors Recommendation

After careful consideration, the Board of Directors approved the Stock Issuance Proposal and directed that it be submitted to the holders of the Company’s Common Stock for their approval. The Board of Directors recommends that the holders of the Company’s Common Stock vote “FOR” the Stock Issuance Proposal.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE
“FOR”
THE STOCK ISSUANCE PROPOSAL.

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PROPOSAL NO. 4

ADJOURNMENT PROPOSAL

General

The Adjournment Proposal, if adopted, will allow our Board of Directors to adjourn the Special Meeting to a later date or dates to permit further solicitation of proxies. The Adjournment Proposal will only be presented to our stockholders in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Preferred B Charter Amendment Proposal, the Preferred C Charter Amendment Proposal, and/or the Stock Issuance Proposal. In no event will our Board of Directors adjourn the Special Meeting beyond November 11, 2022.

Consequences if the Adjournment Proposal is Not Approved

If the Adjournment Proposal is not approved by our stockholders, our Board of Directors may not be able to adjourn the Special Meeting to a later date in the event that there are insufficient votes for, or otherwise in connection with, the approval of the Preferred B Charter Amendment Proposal, the Preferred C Charter Amendment Proposal, and/or the Stock Issuance Proposal.

Vote Required

Assuming a quorum is present, the affirmative vote of a majority of the votes cast on the Adjournment Proposal is required to approve the Adjournment Proposal. Abstentions and broker non-votes will have no effect on the outcome of the Adjournment Proposal. Abstentions will be counted in connection with the determination of whether a valid quorum is established but will have no effect on the outcome of the Adjournment Proposal.

Board of Directors Recommendation

After careful consideration, the Board of Directors approved the Adjournment Proposal and directed that it be submitted to the holders of the Company’s Common Stock for their approval. The Board of Directors recommends that the holders of the Company’s Common Stock vote “FOR” the Adjournment Proposal, if presented.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE
“FOR”
THE ADJOURNMENT PROPOSAL.

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CAPITALIZATION

The following table sets forth our capitalization as of June 30, 2022 (in thousands, except shares):

•

on an actual basis;

•

on an as adjusted basis to give effect to the Exchange Offers and the issuance of shares of Common Stock pursuant to the Segregation Order to constitute a portion of the Preferred B Common Fund (in each case, assuming all of the Preferred Stock is exchanged for the Preferred Stock Consideration where the Company issues only cash for the Cash/New Preferred Stock Portions and pursuant to the Segregation Order to constitute a portion of the Preferred B Common Fund); and

•

on an as adjusted basis to give effect to the Exchange Offers and the issuance of shares of Common Stock pursuant to the Segregation Order to constitute a portion of the Preferred B Common Fund (in each case, assuming all of the Preferred Stock is exchanged for the Preferred Stock Consideration where the Company issues only New Preferred Stock for the Cash/New Preferred Stock Portions and pursuant to the Segregation Order to constitute a portion of the Preferred B Common Fund).

You should read this information together with our financial statements and the notes to those statements appearing elsewhere in this Proxy Statement or in the documents incorporated by reference in this Proxy Statement. See “How to Obtain Additional Information” and “Incorporation by Reference.”

Actual June 30,
2022

As Adjusted
June 30, 2022
(assuming
cash issued to satisfy
Cash/New
Preferred
Stock Portion)

As Adjusted
June 30, 2022
(assuming
New Preferred

SEC Form DEF 14A filed by Impac Mortgage Holdings Inc.