Sculptor Capital Management chief James Levin made much more money last year than he did in 2019. Or was it much less?
Once again, it all depends upon which compensation table one looks at in the firm’s proxy statement, made public on Wednesday.
According to one table, the chief investment officer who recently became CEO earned $37.6 million in 2020. But a separate table in the same proxy said he made more than $51 million.
How can this be?
As Institutional Investor noted last year, the publicly-traded firm has made the highly unusual move of publishing two different compensation tables.
One of them follows SEC requirements for how to classify various forms of compensation. The other contains certain adjustments that the firm says are more “helpful” in understanding how management views the total annual compensation of its five named executive officers in a given year, according to the filing.
[II Deep Dive: How Much Did Sculptor’s Top Execs Make in 2019?]
Sculptor makes adjustments to the SEC-required disclosure in a variety of categories.
For example, annual bonus compensation is included in the year for which it is earned, rather than the year of grant or vesting, the firm explained in the latest proxy. Special long-term awards are valued and included as compensation at the time of realization because certain units are subject to conditions that must be satisfied before being awarded, Sculptor said.
In addition, special long-term awards, in certain cases, are reduced because awards were granted in connection with the forfeiture of other previously granted awards, according to the proxy.
In 2020, the difference between Sculptor’s preferred table and the SEC-required table is a total of $24 million for the five named executives combined. The higher amount is primarily driven by the net impact of counting special long-term awards at the time of realization rather than at the time of grant, as well as including restricted stock units and deferred cash interests in the year of service rather than in the year of grant or vesting.
In the case of Levin, under SEC rules he made nearly $37.6 million in 2020, down from $52.5 million the previous year. Although Levin did not receive a salary, he received a bonus of nearly $34 million. He also received $3.7 million in stock awards.
The bonus reflects the annual cash bonus paid to Levin under his partner agreement and the vested portion of his 2019 annual bonus awarded in the form of deferred cash interest.
Under Sculptor’s preferred way of reporting compensation, Levin earned more than $51 million, including a bonus of about $33.5 million as well as a deferred bonus of more than $14 million.
The deferred bonus reflects the portion of the 2020 annual bonus payable in the form of restricted stock units awarded under the 2013 incentive plan, as well as the portion of the bonus in the form of deferred cash interest, the firm explained in the filing.
Levin’s predecessor as CEO, Robert Shafir, earned a little more than $10 million under SEC calculations and nearly $19 million according to Sculptor’s method. The biggest difference is more than $8 million in special long-term awards recognized under the firm’s method.
Chief financial officer Thomas Sipp earned $6.3 million using Sculptor’s method, or $5.2 million the SEC’s way.
President and chief operating officer Wayne Cohen earned either $7.7 million or $7.1 million.
Finally, chief legal officer David Levine earned $4.2 million by Sculptor’s calculations and $4.1 million under the SEC’s method.
Sculptor is the former Och-Ziff Capital Management Group, founded by Dan Och in 1994 with a $100 million investment from the Ziff Brothers. At the beginning of 2015, Och-Ziff was the world’s third-largest hedge fund firm, managing $46 billion.
In September 2016, Och-Ziff settled criminal and civil charges with the U.S. government over bribes paid to government officials in several African countries.
Och was replaced as CEO by Shafir in early 2018 and resigned as chairman in March 2019.
The firm changed its name to Sculptor in September 2019.
Co-founder David Windreich also retired in 2018, leaving Levin as the sole chief investment officer.
Levin succeeded Shafir as CEO on April 1, 2021.
Sculptor had $36.8 billion in assets under management at year-end. This includes $10.5 billion in the multistrategy funds and reflects appreciation as well as $464 million in net outflows.
Last year the Sculptor Master Fund was up 19.5 percent, its best year in more than a decade.
It was up 3.5 percent in the first quarter of this year, according to a filing.
