10-K 1 sami02ar1_10k.txt SAMI02AR1, 10K, 1202 SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-K Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 (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, 2002 or [ ] Transition Report Pursuant to Section 13 or 15d of the Securities Exchange Act of 1934 For the transition period from _____________ to ________ Commission file Number 333-51279 Structured Asset Mortgage Investments Inc. (Exact name of registrant as specified in its charter) Delaware 13-3633241 (State or other jurisdiction (I.R.S. Employer of incorporation or organization) Identification No.) 383 Madison Avenue New York, NY 10179 (Address of Principal Executive Offices) (Zip Code) Registrant's telephone number, including area code: (212) 272-2000 Structured Asset Mortgage Investments Inc. Mortgage Pass-Through Certificates Series 2002-AR1 (Title of each class of securities covered by this Form) 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 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. X - Yes No PART I Item 1. Business Not applicable. Item 2. Properties Not applicable on reliance of Relief Letters Item 3. Legal Proceedings There were no legal proceedings. Item 4. Submission of Matters to a Vote of Security Holders There were no matters submitted to a vote of the Security Holders. PART II Item 5. Market for Registrant's Common Equity and Related Stockholder matters There is no established public trading market for the notes. There were less than 300 participants in the DTC system. Structured Asset Mortgage Investments Inc. Mortgage Pass-Through Certificates Series 2002-AR1 Class I-A Cede & Co Series 2002-AR1 Class II-A Cede & Co Series 2002-AR1 Class III-A Cede & Co Series 2002-AR1 Class IV-A Cede & Co Series 2002-AR1 Class V-A Cede & Co Series 2002-AR1 Class VI-A Cede & Co Series 2002-AR1 Class M-1 Cede & Co Series 2002-AR1 Class B-1 Cede & Co Series 2002-AR1 Class B-2 Cede & Co Series 2002-AR1 Class B-3 Cede & Co Series 2002-AR1 Class B-4 1 Series 2002-AR1 Class B-5 1 Series 2002-AR1 Class B-6 1 Item 6. Selected Financial Data. Not applicable. Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations. Not applicable. Item 8. Financial Statements and Supplementary Data. Not applicable. Item 9. Changes in and Disagreements with Accountants on Accounting and 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. PART IV Item 14. Exhibits, Financial Statement Schedules, and Reports on Form 8-K (a) 1. Not Applicable 2. Not Applicable 3. Exhibits 99.1 Annual Summary Statement 99.2 Annual Statement as to Compliance. 99.3 Annual Independent Public Accountant's Servicing Report. 99.4 Annual Report of Management (b) Reports on Form 8-K The registrant has filed Current Reports on Form 8-K with the Securities and Exchange Commission dated: May 28, 2002; June 25, 2002; July 25, 2002; August 26, 2002; September 25, 2002, October 25, 2002; November 25, 2002; December 26, 2002 (c) See (a) 3 above (d) Not Applicable 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. /s/ Jeffrey Mayer Name: Jeffrey Mayer Title: Vice President Dated: March 28, 2003 Sarbanes-Oxley Certification I, Jeffrey Mayer, 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 2002-AR1 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. Based on my knowledge and upon the annual compliance statement included in the report and required to be delivered to the trustee in accordance with the terms of the pooling and servicing, or similar, agreement, and except as disclosed in the reports, the servicer has fulfilled its obligations under the servicing 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: Bank One, National Association, as Trustee Bank of America, NA, as Master Servicer Date: March 31, 2003 Signature: /s/ Jeffrey Mayer Name: Jeffrey Mayer Company: Structured Asset Mortgage Investments, Inc. Title: Vice President EXHIBIT INDEX Exhibit NumberDescription 99.1 Annual Summary Statement 99.2 Annual Statement of Compliance 99.3 Report of Independent Accountants 99.4 Report of Management EXHIBIT 99.1 -- Summary of Aggregate Amounts or End of Year Amounts for the period ending December 31, 2002 Structured Asset Mortgage Investments Inc. Mortgage Pass-Through Certificates Series 2002-AR1 STATEMENT TO CERTIFICATEHOLDERS Beginning Current Principal Principal Pass-Through Accrued Class Balance Distribution Rate Interest I-A 193,544,100 83,464,620 5.70611% 6,856,046 II-A 152,705,900 20,783,970 4.09817% 4,340,631 III-A 21,782,700 5,436,698 6.43764% 880,068 IV-A 19,830,900 8,983,012 6.36154% 744,305 V-A 60,568,000 31,788,667 7.23047% 2,267,142 VI-A 34,850,300 12,822,269 7.19813% 1,398,962 M-1 7,650,800 79,750 5.55903% 302,356 B-1 7,141,100 74,437 5.55903% 282,213 B-2 4,335,400 45,191 5.55903% 171,333 B-3 3,060,200 31,899 5.55903% 120,938 B-4 1,530,200 15,950 5.55903% 60,473 B-5 1,530,300 15,951 5.55903% 60,477 B-6 1,530,435 15,953 5.55903% 60,482 R-I 50 50 4.09817% 0 R-II 50 50 4.09817% 0 Total: 510,060,435 163,558,466 17,545,426 Prepayment Ending Realized Loss Deferred Interest Principal Class of Principal Interest Shortfall Balance I-A 0 0 0 110,079,480 II-A 0 0 0 131,921,930 III-A 0 0 0 16,346,002 IV-A 0 0 0 10,847,888 V-A 0 0 0 28,779,333 VI-A 0 0 0 22,028,031 M-1 0 0 0 7,571,050 B-1 0 0 0 7,066,663 B-2 0 0 0 4,290,209 B-3 0 0 0 3,028,301 B-4 0 0 0 1,514,250 B-5 0 0 0 1,514,349 B-6 0 0 0 1,514,482 R-I 0 0 0 0 R-II 0 0 0 0 Total: 0 0 0 346,501,969 AMOUNTS PER $1,000 UNIT Beginning Principal Principal Class Cusip Balance Distribution I-A 86358HMJ5 1000.00000000 431.24342029 II-A 86358HMM8 1000.00000000 136.10456570 III-A 86358HMN6 1000.00000000 249.58786652 IV-A 86358HMY2 1000.00000000 452.98055509 V-A 86358HMZ9 1000.00000000 524.84261293 VI-A 86358HNA3 1000.00000000 367.92419893 M-1 86358HNB1 1000.00000000 10.42368641 B-1 86358HMP1 1000.00000000 10.42368683 B-2 86358HMQ9 1000.00000000 10.42368409 B-3 86358HMR7 1000.00000000 10.42368473 B-4 86358HMS5 1000.00000000 10.42368318 B-5 86358HMU0 1000.00000000 10.42368817 B-6 86358HMW6 1000.00000000 10.42367911 R-I 86358HMK2 1000.00000000 1000.00000000 R-II 86358HML0 1000.00000000 1000.00000000 AMOUNTS PER $1,000 UNIT Ending Interest Principal Class Distribution Balance I-A 35.42368700 568.75657971 II-A 28.42477566 863.89543430 III-A 40.40213289 750.41213348 IV-A 37.53260719 547.01944491 V-A 37.43135732 475.15738707 VI-A 40.14204899 632.07580107 M-1 39.51951430 989.57631359 B-1 39.51951520 989.57631317 B-2 39.51951838 989.57631591 B-3 39.51951833 989.57631527 B-4 39.51951379 989.57631682 B-5 39.51951905 989.57631183 B-6 39.51950435 989.57632089 R-I 4.20000000 0.00000000 R-II 4.20000000 0.00000000 viii) Comp Interest Prin Adv Int Adv Gp 1 Not Provided 13,621.42 50,044.48 Gp 2 Not Provided 17,231.81 31,061.51 Gp 3 Not Provided 3,973.13 18,544.77 Gp 4 Not Provided 1,952.21 10,607.54 Gp 5 Not Provided 6,969.10 39,239.14 Gp 6 Not Provided 3,152.39 21,205.95 Agg 46,900.06 170,703.39 Total Adv Outstanding Unreimbursed Advances Gp 1 63,665.90 63,665.90 Gp 2 48,293.32 82,764.27 Gp 3 22,517.90 22,517.90 Gp 4 12,559.75 12,559.75 Gp 5 46,208.24 51,849.32 Gp 6 24,358.34 32,447.33 Agg 217,603.45 265,804.47 ix) Realized Losses:Current Cumulative Gp 1 0.00 0.00 Gp 2 0.00 0.00 Gp 3 0.00 0.00 Gp 4 0.00 0.00 Gp 5 0.00 0.00 Gp 6 0.00 0.00 Agg 0.00 0.00 x) Current Realized Loss Loans: Loan Cut-off Beginning Net Liq Realized Number Balance Balance Proceeds Loss xi, xii) Number and aggregate Stated Principal Balance of the Mortgage Loans Num of Loans End Sched Prin (Excl REO) Bal Prin Prepayment Gp 1 205 120,705,567 1,562,538 82,000,103 Gp 2 285 140,261,412 2,180,704 18,725,247 Gp 3 29 17,543,141 178,396 5,268,131 Gp 4 13 11,938,768 136,351 8,854,636 Gp 5 56 32,110,032 380,005 31,434,039 Gp 6 45 23,943,049 261,415 12,576,901 Total 633 346,501,969 4,699,409 158,859,057 Net Liq Purchase Substitution Proceeds Principal Principal Gp 1 0.00 0.00 0.00 Gp 2 0.00 0.00 0.00 Gp 3 0.00 0.00 0.00 Gp 4 0.00 0.00 0.00 Gp 5 0.00 0.00 0.00 Gp 6 0.00 0.00 0.00 Total 0.00 0.00 0.00 xi) Number and aggregate Stated Principal Balance of Substitutions and Purchases Substituted Substituted Purchase Purchase Loan Count Loan Balance Count Balance Gp 1 0 0 0 0 Gp 2 0 0 0 0 Gp 3 0 0 0 0 Gp 4 0 0 0 0 Gp 5 0 0 0 0 Gp 6 0 0 0 0 Cumulative Cumulative Cumulative Cumulative Substituted Substituted Purchase Purchase Loan Count Loan Balance Count Balance Gp 1 0 0 0 0 Gp 2 0 0 0 0 Gp 3 0 0 0 0 Gp 4 0 0 0 0 Gp 5 0 0 0 0 Gp 6 0 0 0 0 xiii) Delinquency Information for all Mortgage Loans (Includes Loans in Foreclosure, Bankruptcy, and REO) Delinquent 30-59 Days Delinquent 60-89 Days Count Sched Bal Count Sched Bal Gp 1 0 0 0 0 Gp 2 0 0 0 0 Gp 3 0 0 0 0 Gp 4 0 0 0 0 Gp 5 0 0 0 0 Gp 6 0 0 1 384,874 Total 0 0 1 384,874 Delinquent 90+ Days Count Sched Bal Gp 1 0 0 Gp 2 1 1,393,790 Gp 3 0 0 Gp 4 0 0 Gp 5 0 0 Gp 6 0 0 Total 1 1,393,790 xiv) Mortgage Loans in Foreclosure Proceedings Count Outstanding Balance Gp 1 0 0 Gp 2 0 0 Gp 3 0 0 Gp 4 0 0 Gp 5 0 0 Gp 6 0 0 Total 0 0 xv, xvi) Mortgage Loans as to which the Mortgaged Property is an REO Property Count Outstanding Bal Book Value Gp 1 0 0 0 Gp 2 0 0 0 Gp 3 0 0 0 Gp 4 0 0 0 Gp 5 0 0 0 Gp 6 0 0 0 Total 0 0 0 xvii) Cumulative Realized Losses Class I-A 0.00 II-A 0.00 III-A 0.00 IV-A 0.00 V-A 0.00 VI-A 0.00 M-1 0.00 B-1 0.00 B-2 0.00 B-3 0.00 B-4 0.00 B-5 0.00 B-6 0.00 Total 0.00 xviii) Average Loss Severity Percentage 0.00% xix) Group percentages Senior Mezzanine Senior Senior Prepay and Subordinate Percentage Percentage Percentage Gp 1 91.90376908% 100.00000000% 8.09623092% Gp 2 94.09284653% 100.00000000% 5.90715347% Gp 3 93.54738860% 100.00000000% 6.45261140% Gp 4 92.21257596% 100.00000000% 7.78742404% Gp 5 90.63434534% 100.00000000% 9.36565466% Gp 6 92.41010310% 100.00000000% 7.58989690% Senior Mezzanine and Subordinate Prepayment Percentage Gp 1 0.00000000% Gp 2 0.00000000% Gp 3 0.00000000% Gp 4 0.00000000% Gp 5 0.00000000% Gp 6 0.00000000% EXHIBIT 99.2 -- Servicer's Annual Statement of Compliance Bank of America Officer's Certificate Pursuant to the terms of the Servicing Agreement, the undersigned officer certifies to the following: 1. All hazard (or mortgage impairment if applicable), flood, or other casualty insurance and primary mortgage guaranty insurance premiums, taxes, ground rents, assessments, and other charges have been paid in connection with the Mortgaged Properties; 2. Each officer has reviewed the activities and performance of the Seller/Servicer during the preceding calendar year and to the best of each officer's knowledge, based on such review, the Seller/Servicer has fulfilled all of its obligations under the Agreement throughout the year. Certified By: /s/ Donna Dzimian Donna Dzimian Officer EXHIBIT 99.3 -- Report of Independent Auditors Report of Independent Accountants To the Board of Directors and Shareholder of Bank of America, N.A. We have examined management's assertion about compliance by BA Mortgage, LLC and the Mortgage division of Bank of America, N.A. (collectively, the "Company"), which together comprise an operating division of Bank of America, N.A., with the minimum servicing standards (the "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, 2002 included in the accompanying management assertion (see Exhibit 1). Management is responsible for the Company's compliance with the Standards. Our responsibility is to express an opinion on management's assertion about the Company's compliance based on our examination. Our examination was made inaccordance 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 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 Standards. In our opinion, management's assertion that the Company complied with the aforementioned Standards as of and for the year ended December 31, 2002 is fairly stated, in all material respects. /s/ PriceWaterhouseCoopers LLP PriceWaterhouseCoopers LLP March 7, 2003 EXHIBIT 99.4 -- Report of Management Management's Assertion Concerning Compliance with USAP Minimum Servicing Standards March 7, 2003 As of and for the year ended December 31, 2002, BA Mortgage LLC, and the Mortgage division of Bank of America, N.A. (collectively the "Company"), which together comprise an operating division of Bank of America, N.A., 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 ("USAP"). As of and for this same period, the Company had in effect a fidelity bond and errors and omissions policy in the amounts of $400,000,000 and $475,000,000 respectively. /s/ Kevin M. Shannon /s/ H. Randall Chestnut Kevin M. Shannon H. Randall Chestnut President Senior Vice President Consumer Real Estate Bank of America, N.A. Bank of America, N.A. /s/ David H. Rupp /s/ Gary K. Bettin David H. Rupp Gary K. Bettin Senior Vice President Senior Vice President and Bank of America, N.A. National Servicing Executive Bank of America, N.A. /s/ J. Mark Hanson J. Mark Hanson Senior Vice President Bank of America, N.A.