Bilal Rashid
About Bilal Rashid
Bilal Rashid, age 54, is Chairman of the Board and Chief Executive Officer of OFS Capital Corporation, serving since 2014. He has 25+ years in corporate and structured credit, investment banking and debt capital markets, with prior roles at Merrill Lynch (2005–2008), Natixis, CIBC, International Finance Corporation (World Bank), and Lehman Brothers; he holds a B.S. in Electrical Engineering from Carnegie Mellon University and an MBA from Columbia University . OFS’s externally managed BDC structure ties adviser compensation to total assets and income; base management fees were $5.99 million and incentive fees $4.18 million in FY2024, indicating adviser economics linked to portfolio scale and net investment income rather than executive cash pay at the company level .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Merrill Lynch (Global Markets & Investment Banking) | Managing Director | 2005–2008 | Led capital markets/investment banking initiatives; credit and structured finance deal leadership |
| Natixis Capital Markets | Vice President | Pre-2005 | Structured credit and capital markets; team move from CIBC enhanced capabilities |
| CIBC | Vice President | Pre-Natixis | Corporate credit experience; foundation in structured products |
| International Finance Corporation (World Bank) | Investment Analyst (Project Finance) | Pre-CIBC | Emerging markets project finance; risk assessment rigor |
| Lehman Brothers | Financial Analyst | Early career | Analytical grounding in investment banking |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Hancock Park Corporate Income, Inc. | Chairman, President & CEO | Current | BDC affiliate leadership |
| OFS Credit Company, Inc. | Chairman, President & CEO | Current | Public credit company leadership |
| CIM Real Assets & Credit Fund | Board of Trustees Member | Current | Oversight at affiliated RIC sub-advised by OFS Advisor |
| Orchard First Source Capital, Inc. (OFSC) | President; Senior Managing Director | Current | Manages staffing to OFS Advisor |
| OFS Capital Management, LLC (OFS Advisor) | Senior leadership; investment committees | Current | Adviser responsible for sourcing, diligence, structuring, monitoring |
| Orchard First Source Asset Management Holdings, LLC (OFSAM Holdings) | President & CEO; Executive Committee member | Current | Parent entity governance and strategy |
Fixed Compensation
OFS Capital is externally managed; executive officers (including the CEO) receive no direct compensation from OFS Capital. Compensation is paid by OFSC and reimbursed under the Administration Agreement. Bilal Rashid, as an “interested” director, receives no director fees from OFS Capital .
| Item | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Officer direct cash compensation paid by OFS Capital | None | None | None |
| Administration fee expense (OFS Services) | $1.74 million | $1.68 million | $1.52 million |
| CEO Director Fees (Bilal Rashid) | $0 | $0 | $0 (interested director) |
Performance Compensation
Adviser compensation is tied to assets and income through base management and incentive fees. While exact formulas are not reiterated in the proxies, amounts paid indicate linkage to net investment income and portfolio scale.
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Management Fee (paid to OFS Advisor) | $7.98 million | $7.22 million | $5.99 million |
| Incentive Fee (paid to OFS Advisor) | $0.40 million | $5.04 million | $4.18 million |
Equity Ownership & Alignment
| Snapshot Date | Bilal Rashid Beneficially Owned Shares | % of Shares Outstanding | Notes |
|---|---|---|---|
| April 10, 2024 | 20,000 | <1% (13,398,078 total shares) | “Over $100,000” dollar range; not a beneficiary of OFSAM Holdings shares for 13(d) |
| April 16, 2025 | 20,000 | <1% (13,398,078 total shares) | “Over $100,000” dollar range; OFSAM Holdings owned directly/indirectly by Bilal Rashid and a Ressler trust subsidiary; shares pledged for revolving credit facility |
- Approximate percentage calculation: 20,000 ÷ 13,398,078 ≈ 0.15%, confirming “<1%” status .
- Pledging red flag: OFSAM Holdings’ 2,946,473 shares are pledged as collateral; Mr. Rashid is not a beneficial owner of those shares for Section 13(d) purposes, but indirect interests and pledge exist at the affiliate level .
Employment Terms
- Externally managed BDC model: No direct employment contract for CEO with OFS Capital; officers are OFSC employees and costs are reimbursed under the Administration Agreement .
- Investment Advisory & Management Agreement: Adviser compensated via base management fee on total assets and incentive fee on income; this structure can incentivize leverage and certain investment types; fees were $5.99 million (base) and $4.18 million (incentive) in FY2024 .
- Co-investment relief: SEC exemptive order (Aug 4, 2020) permits co-investment with affiliated funds subject to independent director approvals and “required majority” conclusions; enhances execution flexibility while imposing governance safeguards .
Board Governance and Service
- Board roles: Rashid is Chairman and CEO (combined role) since 2014; he is an “interested” director under the 1940 Act .
- Governance structure: Combined Chair/CEO with Lead Independent Director (Elaine E. Healy) to balance oversight; majority independent committees (Audit, Compensation, Nominating) .
- Committees: Independent directors (Healy – Audit chair; Ranganathan – Compensation chair; Shetty – Nominating chair). Rashid does not serve on these committees given “interested” status .
- Meeting cadence: Board met 12 times in FY2022; Audit Committee met 15 times; Compensation met 2 times; Nominating met 4 times. Directors attended ≥75% of meetings .
Director Compensation (for context)
- Independent director annual cash retainer: $90,000; committee chairs receive $10,000 each. Interested directors (including Rashid) receive no director compensation from OFS Capital .
Performance & Track Record Indicators
- Trading vs. NAV context: OFS shares have traded at discounts/premiums to NAV. 2024 quarterly NAVs and closing price ranges highlight persistent discounts in multiple quarters (e.g., 3Q2024: NAV $11.29; high $9.35; low $7.75 → high at −17.2% vs NAV; low at −31.4%) . 2023 quarterly patterns show similar variability (e.g., 1Q2023 high at −18.6% vs NAV; low at −28.5%; 4Q2023 high at +2.6% vs NAV; low at −19.7%) .
- CFO transition: In January 2025, CFO/Treasurer Jeffrey Cerny resigned effective March 31, 2025, remaining on the Board; Kyle Spina appointed CFO/Treasurer, signaling continuity in finance leadership .
Compensation Structure Analysis
- Pay-for-performance alignment: Company-level executive cash compensation is not disclosed because officers are paid by affiliates; adviser incentive fees paid by OFS Capital are linked to income, potentially aligning with net investment income growth but also creating leverage incentives given base fees on total assets .
- Mix trends (2022–2024): Base fees declined from $7.98m (2022) to $5.99m (2024), while incentive fees rose sharply in 2023 ($5.04m) and moderated in 2024 ($4.18m), suggesting variability corresponding to income generation rather than fixed guarantees .
- Governance mitigants: Independent director oversight, lead independent director structure, and SEC co-investment order conditions provide checks on affiliated adviser incentives .
Risk Indicators & Red Flags
- Pledging: 2,946,473 OFS shares held by OFSAM Holdings are pledged as collateral for a revolving credit facility (affiliate-level pledge) .
- Combined Chair/CEO: Concentration of roles may raise independence concerns; addressed by lead independent director and fully independent committees .
- Related-party transactions: Multiple affiliated agreements (Investment Advisory, Administration, Staffing) and investment committee overlaps necessitate rigorous independent oversight to manage conflicts .
Equity Ownership & Director Guidelines
- Ownership guidelines: Not disclosed for executives/directors in the referenced filings; independent director dollar-ranges are provided (“Over $100,000”) but no formal multiple-of-salary policy is cited .
- Hedging/pledging policy: Code of Ethics requires pre-clearance for derivative transactions; does not expressly prohibit hedging; independent director shares may be pledged (Healy’s pledged line of credit disclosed) .
Employment & Contracts
- Severance/change-of-control: Not disclosed for the CEO in OFS Capital filings; as externally managed, executive employment terms and severance would reside at affiliate level and are not detailed in company proxy/8-K materials .
- Non-compete/non-solicit: Not disclosed in the company filings reviewed.
Investment Implications
- Alignment: CEO’s direct ownership in OFS is modest (~0.15% of shares), while affiliate-level ownership and pledged shares via OFSAM Holdings introduce financing-related risk optics; nonetheless, incentive fees tied to income create earnings-driven motivations, balanced by independent director oversight and an SEC co-investment framework .
- Retention risk: External management model and intertwined leadership across affiliates suggest low near-term turnover risk at the adviser level; recent CFO transition retained board continuity, supporting stability .
- Trading signals: Persistent trading discounts to NAV in recent quarters may incentivize capital raising flexibility proposals and portfolio income generation to narrow discounts; watch for adviser fee trends vs net investment income and any changes in leverage policy .
- Governance: Combined Chair/CEO is mitigated by strong independent committee structure and lead independent director; continued monitoring of related-party transactions and pledge disclosures is warranted .
Note: Officer cash/base salary, bonus targets, option/RSU grants, vesting schedules, clawbacks, and executive employment contract economics are not disclosed at the company level due to the externally managed BDC structure. Director compensation is cash-only for independent directors; interested directors receive none .