Item 1.01 Entry Into a Material Definitive Agreement.
On May 5, 2017, Impac Mortgage Holdings, Inc., a Maryland corporation (the
Company
), and certain investors entered into an exchange agreement pursuant to which the Company agreed to issue 412,264 shares (the
Shares
) of its common stock (the
Offering
). In October 2005, the Company formed Impac Capital Trust #4 (the
Trust
) as a special purpose entity for the sole purpose of issuing $20.6 million of trust preferred securities. The investors in the Offering held trust preferred securities with an aggregate liquidation amount of $8.5 million issued by the Trust. The Company issued subordinated interest debentures to the Trust due July 30, 2035 in exchange for the proceeds of the offering of the trust preferred securities. The interest rate on the trust preferred securities is a variable rate of three-month LIBOR plus 3.75% per annum. At December 31, 2016, the interest rate was 4.75%.
On May 11, 2017, further to the exchange agreement, the Offering closed and the investors exchanged the $8.5 million of trust preferred securities at a discount to par for aggregate consideration consisting of 412,264 shares of the Companys common stock. Accrued and unpaid interest on the trust preferred securities was paid in cash in the aggregate amount of approximately $14,000.
The Company received no cash proceeds from the issuance of the Shares. The effect of the Offering was to cause the cancellation of $8.5 million of subordinated debentures issued by Company to the Trust further to the issuance of the trust preferred securities exchanged for the Shares. The Company expects to discharge and terminate the Indenture dated as of October 18, 2005, as amended by the First Supplemental Indenture dated as of July 14, 2009, between the Company and Wilmington Trust Company, as trustee, and the Amended and Restated Declaration of Trust dated as of October 18, 2005 and Amendment No. 1 dated as of July 14, 2009.
The Shares issued in the Offering were issued pursuant to the Companys effective shelf registration statement on Form S-3 (Registration No. 333-215199) (the
Registration Statement
) previously filed with the Securities and Exchange Commission (the
SEC
), in accordance with the provisions of the Securities Act of 1933, as amended (the
Securities Act
), as supplemented by a prospectus supplement dated May 11, 2017, which the Company filed with the SEC pursuant to Rule 424(b)(5) under the Securities Act.
This Current Report on Form 8-K shall not constitute an offer to sell or a solicitation of an offer to buy any Shares, nor shall there be any sale of the Shares in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or other jurisdiction.
The exchange agreement is filed as Exhibit 10.1 to this Current Report on Form 8-K and is incorporated herein by reference. The foregoing description of the exchange agreement and the transactions contemplated thereby is qualified in its entirety by reference to Exhibit 10.1.
This report is being filed for the purpose of filing Exhibit 5.1 and Exhibit 23.1 as exhibits to the Registration Statement and such exhibits are hereby incorporated by reference into the Registration Statement.
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