1000298--3/16/2010--IMPAC_MORTGAGE_HOLDINGS

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{loan, real, estate}

{capital, credit, financial}

{stock, price, share}

{condition, economic, financial}

{tax, income, asset}

{debt, indebtedness, cash}

{acquisition, growth, future}

{investment, property, distribution}

{loss, insurance, financial}

{control, financial, internal}

{financial, litigation, operation}

{personnel, key, retain}

{provision, law, control}

{regulation, government, change}

Risks Related To Our Businesses If we fail to generate new sources of revenue successfully, our business, financial condition and results of operations could be materially and adversely affected. Our long-term liquidity is dependent on our ability to grow and maintain new businesses. Deteriorating mortgage market conditions have had and may continue to have a material adverse effect on our earnings and financial condition. Difficult market conditions have already affected our industry and may continue to adversely affect us. If defaults on our mortgage loans continue, it will result in continuing declines in revenues and net income. Without adequate financing, the growth of our business operations will be limited. We may not be able to access financing sources on favorable terms, or at all, which could adversely affect our ability to implement and operate our business as planned. Our current long-term debt obligations, and any future debt financing may, contain restrictive covenants relating to our operations that may inhibit our ability to grow our business and increase revenues. If we are forced to liquidate, we may have few unpledged assets for distribution to unsecured creditors or equity holders. A material difference between the assumptions used in the determination of the value of our residual interests and our actual experience would cause us to write down the value of these securities and could harm our liquidity and financial condition. The Company's mortgage portfolio contains significant interest rate risks that are not currently hedged by the Company. We may experience reduced net earnings or losses if our liabilities re-price at different rates than our assets. Second trust deed mortgages in our long term investment portfolio expose us to greater credit risks. We may be subject to losses on mortgages for which we did not obtain mortgage insurance. Loans to non-conforming borrowers may expose us to a higher risk of delinquencies, foreclosures and losses. Our commercial and multifamily mortgages may expose us to increased lending risks. The geographic concentration of our mortgages increases our exposure to risks in those areas. Representations and warranties made by us in our loan sales and securitizations may subject us to liability. The performance of our long-term mortgage portfolio may be adversely affected by the performance of parties who service or sub-service our mortgage loans. We are a defendant in purported class action lawsuits and may not prevail in these matters. There has been recent litigation in the mortgage industry related to securitizations. We are exposed to environmental liabilities, with respect to properties that we take title to upon foreclosure, that could increase our costs of doing business and harm our results of operations. We are subject to risks of operational failure that are beyond our control. Loss of our current executive officers or other key management could significantly harm our business. If we fail to maintain effective systems of internal control over financial reporting and disclosure controls and procedures, we may not be able to report our financial results accurately or prevent fraud, which could cause current and potential stockholders to lose confidence in our financial reporting, adversely affect the trading price of our securities or harm our operating results. Our ability to utilize our net operating losses and certain other tax attributes may be limited. Violation of various federal, state and local laws may result in financial losses. New regulatory laws affecting the mortgage industry may affect our ability to re-enter the mortgage market. Our operations may be adversely affected if we are subject to the Investment Company Act. Limitations on acquisition and change in control ownership limit. Risks Related to Ownership of Our Securities Our share prices have been and may continue to be volatile and the trading of our shares may be limited. Issuances of additional shares of our common stock may adversely affect its market price and significantly dilute stockholders.

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1000298--3/16/2010--IMPAC_MORTGAGE_HOLDINGS_INC