10-K 1 sam03ar3_form10k.txt UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark one) /X/ ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2003 OR / / TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Commission File Number: 333-68542-26 Structured Asset Mortgage Investments Inc. Mortgage Pass-Through Certificates Series 2003-AR3 (Exact name of registrant as specified in its charter) New York 54-2132871 54-2132872 54-2132873 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) c/o Wells Fargo Bank, N.A. 9062 Old Annapolis Road Columbia, MD 21045 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (410) 884-2000 Securities registered pursuant to Section 12(b) of the Act: NONE. Securities registered pursuant to Section 12(g) of the Act: NONE. Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes X No ___ Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K ( 229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant's knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. Not applicable. Indicate by check mark whether the registrant is an accelerated filer (as defined in Exchange Act Rule 12b-2). Yes___ No X State the aggregate market value of the voting and non-voting common equity held by non-affiliates computed by reference to the price at which the common equity was last sold, or the average bid and asked price of such common equity, as of the last business day of the registrant's most recently completed second fiscal quarter. Not applicable. Indicate the number of shares outstanding of each of the registrant's classes of common stock, as of the latest practicable date. Not applicable. List hereunder the following documents if incorporated by reference and the Part of the Form 10-K (e.g. Part I, Part II, etc.) into which the document is incorporated: (1)Any annual report to security holders; (2) Any proxy or information statement; and (3)Any prospectus filed pursuant to Rule 424(b) or (c) under the Securities Act of 1933. The listed documents should be clearly described for identification purposes (e.g. annual report to security holders for fiscal year ended December 24, 1980). Not applicable. PART I Item 1. Business. Omitted. Item 2. Properties. See Item 15(a), Exhibits 99.1, 99.2, and 99.3, for information provided in lieu of information required by Item 102 of Regulation S-K. Item 3. Legal Proceedings. The registrant knows of no material pending legal proceedings involving the trust created under the Pooling and Servicing Agreement (the Trust), the Trustee, the Servicer or the registrant with respect to the Trust other than routine litigation incidental to the duties of the respective parties. Item 4. Submission of Matters to a Vote of Security Holders. None. PART II Item 5. Market for Registrant's Common Equity and Related Stockholder Matters. No established public trading market for the Certificates exists. Records provided to the Trust by the DTC and the Trustee indicate that as of December 31, 2003, the number of holders of record for each class of Certificate were as follows: Class A-1 6 Class A-2 3 Class B-1 3 Class B-2 4 Class B-3 4 Class B-4 1 Class B-5 1 Class B-6 1 Class M 1 Class R-I 1 Class R-II 1 Class R-III 1 Total: 27 Item 6. Selected Financial Data. Omitted. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operation. Omitted. Item 7A. Quantitative and Qualitative Disclosures about Market Risk. Not applicable. Item 8. Financial Statements and Supplementary Data. See Item 15(a), Exhibits 99.1, 99.2, 99.3, for information provided in lieu of information required by Item 302 of Regulation S-K. Item 9. Changes in and Disagreements with Accountants on Accounting and Financial Disclosure. None. Item 9A. Controls and Procedures. Not applicable. PART III Item 10. Directors and Executive Officers of the Registrant. Not applicable. Item 11. Executive Compensation. Not applicable. Item 12. Security Ownership of Certain Beneficial Owners and Management. Not applicable. Item 13. Certain Relationships and Related Transactions. Not applicable. Item 14. Principal Accounting Fees and Services. Not applicable. PART IV Item 15. Exhibits, Financial Statement Schedules, and Reports on Form 8-K. (a) Exhibits (31.1) Rule 13a-14(a)/15d-14(a) Certification (99.1) Annual Independent Accountants' Servicing Reports concerning servicing activities for the year ended December 31, 2003. a) EverHome Mtg f/k/a Alliance Mtg Co, as Servicer b) Southtrust Mortgage Corp, as Servicer
(99.2) Report of Management as to Compliance with Minimum Servicing Standards for the year ended December 31, 2003. a) EverHome Mtg f/k/a Alliance Mtg Co, as Servicer b) Southtrust Mortgage Corp, as Servicer
(99.3) Annual Statements of Compliance under the Pooling and Servicing Agreements for the year ended December 31, 2003. a) EverHome Mtg f/k/a Alliance Mtg Co, as Servicer b) Southtrust Mortgage Corp, as Servicer
(99.4) Aggregate Statement of Principal and Interest Distributions to Certificate Holders. (b) On December 2, 2003 and December 24, 2003 reports on Form 8-K were filed by the Company in order to provide the statements for the monthly distributions to holders of the Certificates. No other reports on Form 8-K have been filed during the last quarter of the period covered by this report. (c) Not applicable. (d) Omitted. (99.5) Reliance Certifications Mandated under the Pooling and Servicing Agreement for the year ended December 31, 2003. a) EverHome Mtg f/k/a Alliance Mtg Co, as Servicer b) Southtrust Mortgage Corp, as Servicer Filed herewith. Certification has been received. SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized: Structured Asset Mortgage Investments Inc. Mortgage Pass-Through Certificates Series 2003-AR3 (Registrant) Signed: Wells Fargo Bank, N.A. as Master Servicer By: Brett Handelman, Vice President By: /s/ Brett Handelman, Vice President Dated: March 30, 2004 SUPPLEMENTAL INFORMATION TO BE FURNISHED WITH REPORTS FILED PURSUANT TO SECTION 15(d) OF THE ACT BY REGISTRANTS WHICH HAVE NOT REGISTERED SECURITIES PURSUANT TO SECTION 12 OF THE ACT. (a)(i) No annual report is provided to the Certificateholders other than with respect to aggregate principal and interest distributions. (a)(ii) No proxy statement, form of proxy or other proxy soliciting material has been sent to any Certificateholder with respect to any annual or other meeting of Certificateholders. Exhibit Index Exhibit No. Ex-31.1 Rule 13a-14(a)/15d-14(a) Certification I, Brett Handelman, certify that: 1. I have reviewed this annual report on Form 10-K, and all reports on Form 8-K containing distribution or servicing reports filed in respect of periods included in the year covered by this annual report, of Structured Asset Mortgage Investments Inc. Mortgage Pass-Through Certificates, Series 2003-AR3 Trust; 2. Based on my knowledge, the information in these reports, taken as a whole, does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading as of the last day of the period covered by this annual report; 3. Based on my knowledge, the distribution or servicing information required to be provided to the trustee by the servicer under the Pooling and Servicing or similar, agreement, for inclusion in these reports is included in these reports; 4. I am responsible for reviewing the activities performed by the master servicer under the pooling and servicing, or similar, agreement, and based on upon my knowledge and the annual compliance review required under that agreement, and except as disclosed in the reports, the master servicer has fulfilled its obligations under that agreement; and 5. The reports disclose all significant deficiencies relating to the servicer's compliance with the minimum servicing standards based upon the report provided by an independent public accountant, after conducting a review in compliance with the Uniform Single Attestation Program for Mortgage Bankers or similar procedure, as set forth in the pooling and servicing, or similar, agreement, that is included in these reports. In giving the certifications above, I have reasonably relied on information provided to me by the following unaffiliated parties: EverHome Mtg f/k/a Alliance Mtg Co as Servicer, Southtrust Mortgage Corp as Servicer. Date: March 30, 2004 /s/ Brett Handelman Signature Vice President Title Ex-99.1 (a) (Logo) Deloitte Deloitte & Touche LLP Suite 2801 One Independent Drive Jacksonville, FL 32202-5034 USA Tel: +1 9046651400 Fax: +1 9046651600 www.deloitte.com INDEPENDENT ACCOUNTANTS' REPORT ON MANAGEMENT'S ASSERTION ABOUT COMPLIANCE WITH UNIFORM SINGLE ATTESTATION PROGRAM REQUIREMENTS To the Board of Directors EverHome Mortgage Company: We have examined management's assertion about EverHome Mortgage Company's (the "Company") (formerly Alliance Mortgage Company) compliance with the minimum servicing standards identified in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers (USAP) as of and for the year ended December 31, 2003 included in the accompanying management assertion. Management is responsible for the Company's compliance with those minimum servicing standards. Our responsibility is to express an opinion on management's assertion about the entity's compliance based on our examination. Our examination was made in accordance with standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about the Company's compliance with the minimum servicing standards and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on the Company's compliance with the minimum servicing standards. In our opinion, management's assertion that the Company complied with the aforementioned minimum servicing standards as of and for the year ended December 31, 2003 is fairly stated, in all material respects. /s/ Deloitte & Touche LLP February 25, 2004 Member of Deloitte Touche Tohmatsu Ex-99.1 (b) (logo) KPMG KPMG LLP SouthTrust Tower Suite 1800 420 20th Street North Birmingham, AL 35203 Independent Accountants' Report To SouthTrust Mortgage Corporation: We have examined management's assertion that SouthTrust Mortgage Corporation (a wholly owned subsidiary of SouthTrust Bank) complied with the minimum servicing stm1dards set forth in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers {USAP) as of and for the year ended December 31, 2003. Management is responsab1e for SouthTrust Mortgage Corporation's compliance with those minimum servicing standards. Our responsibi1ity is to express an opinion on management's assertion based on our examination. Our examination was conducted in accordance with attestation standards established by the American Institute of Certified Public Accountants and, accordingly, included examining, on a test basis, evidence about SouthTrust Mortgage Corporation's compliance with the minimum servicing standards and performing such other procedures as we considered necessary in the circumstances. We believe that our examination provides a reasonable basis for our opinion. Our examination does not provide a legal determination on SouthTrust Mortgage Corporation's compliance with the minimum servicing standards. In our opinion, management's assertion that SouthTrust Mortgage Corporation complied with the aforementioned minimum servicing standards, except for the matter disclosed in Exhibit 1, during the year ended December 31, 2003 is fairly stated, in all material respects. KPMG LLP March 5, 2004 (log) KPMG, LLP a U.S. limited liability partnership, is the 1ftO""'r film or ~M.. In""""..I, .-.~ Ex-99.2 (a) (logo) EverHome MORTGAGE COMPANY As of and for the year ended December 31, 2003, EverHome Mortgage Company (formerly Alliance Mortgage Company) has complied in all material respects with the minimum servicing standards set forth in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers. As of and for this same period, EverHome Mortgage Company had in effect a fidelity bond and an errors and omissions policy in the amount of $17 million, respectively. /s/ Gary A. Meeks Gary A. Meeks President & COO 2/25/04 /s/ W. Blake Wilson W. Blake Wilson Executive Vice President & CPO 2/25/04 Ex-99.2 (b) (logo) SouthTrust Mortgage 210 Wildwood Parkway Birmingham Alabama 35209 Telephone 205-667-8100 KPMG LLP 420 North 20th Street Suite 1800 Birmingham, Alabama 35203 March 15, 2004 Ladies and Gentlemen: We are providing you this letter in connection with your examination of management's assertion about SouthTrust Mortgage Corporation's compliance with the minimum servicing standards set forth in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers (USAP) as of and for the year ended December 31, 2003 for the purpose of expressing an opinion as to whether management's assertion is fairly stated, in all material respects. We confirm, to the best of our knowledge and belief, the following representations made to you during your examination: 1. We are responsible for complying with the minimum servicing standards in the USAP. 2. We are responsible for establishing and maintaining effective internal control over compliance with the minimum servicing standards. 3. We have performed an evaluation of SouthTrust Mortgage Corporation's compliance with the minimum servicing standards. 4. As of and for the year ended December 31,2003, SouthTrust Mortgage Corporation has complied in all material respects with the minimum servicing standards set forth in the Mortgage Bankers Association of America's USAP, except as disclosed in the applicable servicing letters. 5. We have disclosed to you all known noncompliance with the minimum servicing standards. 6. We have made available to you all documentation related to compliance with the minimum servicing standards. Mortgage Bankers 7. We have disclosed any communications from regulatory agencies, interna1 auditors, and other practitioners concerning possible noncompliance with the minimum servicing standards, including communications received between the end of the period addressed in management's assertion and the date of the independent accountants' report. 8. We have disclosed to you any known noncompliance occurring subsequent to December 31,2003. Very truly yours, SouthTrust Mortgage Corporation /s/Wade O. King Wade O King President and Chief Executive Officer 3-23-04 Date /s/Michael D. Newton Michael D Newton Senior Vice President & Chief Financial Officer March 23, 2004 Date [Logo SouthTrust Mortgage] 210 Wildwood Parkway Birmingham. Alabama 35209 Telephone 205-667-8100 As of and for the year ended December 31, 2003, SouthTrust Mortgage Corporation has complied in all material respects with the minimum servicing standards set forth in the Mortgage Bankers Association of America's Uniform Single Attestation Program for Mortgage Bankers, except as disclosed in the applicable servicing letters. As of and for this same period, SouthTrust Mortgage Corporation had in effect a fidelity bond and errors and omissions policy in the amount of $50,000,000 and $8,000,000, respectively /s/Wade O. King Wade O King President and Chief Executive Officer 3-23-04 Date /s/Michael D. Newton Michael D Newton Senior Vice President & Chief Financial Officer March 23, 2004 Date Mortgage Bankers Ex-99.3 (a) Exhibit "A" Wells Fargo Bank Minnesota, N.A. 9062 Old Annapolis Rd. Columbia, MD 21045 Attention: Master Servicing RE: Officer's Certificate Dear Master Servicer: The undersigned Officer certifies the following for the 2003 fiscal year: (A) I have reviewed the activities and performance of the Servicer during the preceding fiscal year under the tenants of the Servicing Agreement, Trust Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide and to the best of these Officers' knowledge, the Servicer has fulfilled all of its duties, responsibilities or obligations under these Agreements throughout such year, or if there has been a default or failure of the servicer to perform any of such duties, responsibilities or obligations, a description of each default or failure and the nature and status thereof has been reported to Wells Fargo Bank Minnesota, N.A.; (B) I have confirmed that the Servicer is currently an approved FNMA or FHLMC servicer in good standing; (C) I have confirmed that the Fidelity Bond, the Errors and Omissions Insurance Policy and any other bonds required under the tenets of the Servicing Agreement, Trust Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide are in full force and effect; (D) All premiums for each Hazard Insurance Policy, Flood Insurance Policy (if applicable) and Primary Mortgage Insurance Policy (if applicable), with respect to each Mortgaged Property, have been paid and that all such insurance policies are in full force and effect; (E) All real estate taxes, governmental assessments and any other expenses accrued and due, that if not paid could result in a lien or encumbrance on any Mortgaged Property, have been paid, or if any such costs or expenses have not been paid with respect to any Mortgaged Property, the reason for the non-payment has been reported to Wells Fargo Bank Minnesota, N.A.; (F) All Custodial Accounts have been reconciled and are properly funded; and (G) All annual reports of Foreclosure and Abandonment of Mortgage Property required per section 6050H, 6050J and 6050P of the Internal Revenue Code, respectively, have been prepared and filed. By: /s/ Pam E Rothenberg Name: Pam E Rothenberg Title: Sr. Vice President Date: February 6, 2004 Ex-99.3 (b) (Logo) SouthTrust Mortgage 210 Wildwood Parkway Birmingham Alabama 35209 Telephone 205-667-8100 March 24, 2004 Wells Fargo Bank Minnesota, N.A. 9062 Old Annapolis Road Columbia, MD 21045 Attention: Master Servicing RE: Officer's Certificate Dear Master Servicer: The undersigned Officer certifies the following for the 2003 fiscal year: (A) I have reviewed the activities and performance of the Servicer during the preceding fiscal year under the tenants of the Servicing Agreement, Trust Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide and to the best of these Officers' knowledge, the Servicer has fulfilled all of its duties, responsibilities or obligations under these Agreements throughout such year, or if there has been a default or failure of the servicer to perform any of such duties, responsibilities or obligations, a description of each default or failure and the nature and status thereof has been reported to Wells Fargo Bank Minnesota, N.A.; (B) I have confirmed that the Servicer is currently an approved FNMA or FHMLC servicer in good standing; (C) I have confirmed that the Fidelity Bond, the Errors and Omissions Insurance Policy and any other bonds required under the terms of the Servicing Agreement, Trust Agreement, Pooling and Servicing Agreement and/or Seller/Servicer Guide are in full force and effect; (D) All premiums for each Hazard Insurance Policy, Flood Insurance Policy (if applicable) and Primary Mortgage Insurance Policy (if applicable), with respect to each Mortgaged Property, have been paid and that all such insurance policies are in full force and effect; (E) All real estate taxes, governmental assessments and any other expenses accrued and due, that if not paid could result in a lien or encumbrance on any Mortgaged Property, have been paid, or if any such costs or expenses have not been paid with respect to any Mortgage Bankers Mortgaged Property, the reason for the non-payment has been reported to Wells Fargo Bank Minnesota, N.A.; (F) All Custodial Accounts have been reconciled and are properly funded; and (G) All annual reports of Foreclosure and Abandonment of Mortgage Property required per section 6050H, 6050J and 6050P of the Internal Revenue Code, respectively, have been prepared and filed. Certified By: /s/ Jan Turley Officer SVP Title 3-25-04 Date Ex-99.4 Schedule of Year-To-Date Principal and Interest Distributions to Certificateholders Class Interest Principal Losses Ending Balance 1-X 1,222,416.58 0.00 0.00 0.00 2-X 59,843.28 0.00 0.00 0.00 A-1 823,516.05 3,802,638.56 0.00 411,143,961.44 A-2 243,596.78 315,316.58 0.00 45,988,483.42 B-1 18,293.33 0.00 0.00 7,000,000.00 B-2 15,149.17 0.00 0.00 5,250,000.00 B-3 12,263.61 0.00 0.00 4,250,000.00 B-4 7,390.67 0.00 0.00 1,500,000.00 B-5 6,158.89 0.00 0.00 1,250,000.00 B-6 13,550.26 0.00 0.00 2,750,141.49 M 39,213.61 0.00 0.00 16,750,000.00 R-I 0.00 50.00 0.00 0.00 R-II 0.00 50.00 0.00 0.00 R-III 0.00 50.00 0.00 0.00 X 1,282,259.85 0.00 0.00 0.00