SCHEDULE: Northern Right Capital Shifts to Passive Great Elm Stake

Northern Right Capital Management and affiliates, including Matthew A. Drapkin, have amended their beneficial ownership filing for Great Elm Capital Corp. to a Schedule 13G, indicating a passive investment stance following Mr. Drapkin's departure from the board.

Summary

• Northern Right Capital Management, L.P. and its affiliates, along with Matthew A. Drapkin, have filed an Amendment No. 6 to Schedule 13G regarding their beneficial ownership in Great Elm Capital Corp.
• The filing indicates a shift from an active investment stance (previously reported on Schedule 13D) to a passive one, as the reporting persons no longer intend to change or influence the control of the Issuer.
• Matthew A. Drapkin ceased to serve as a director of Great Elm Capital Corp. on February 27, 2026.
• As of March 5, 2026, Matthew A. Drapkin beneficially owns 874,804 shares, representing approximately 6.2% of the outstanding Common Stock.
• Northern Right Capital Management, L.P. and its general partner, BC Advisors, LLC, collectively beneficially own 798,471 shares, representing approximately 5.7% of the outstanding Common Stock.
• The percentage of class is based on 13,998,168 Common Stock outstanding as of February 23, 2026.

Sentiment

Score: 5

Explanation: StockSavvy.ai views this as a neutral development. While the departure of a significant shareholder from the board could be seen negatively, the shift to a passive investment stance reduces potential for disruptive activist campaigns, which can be positive for stability.

Positives

• Continued significant investment by Northern Right Capital Management and affiliates, with Matthew A. Drapkin maintaining a 6.2% stake.
• The shift to a Schedule 13G indicates a less confrontational or activist approach, potentially reducing uncertainty regarding future corporate control battles.

Negatives

• Matthew A. Drapkin's departure from the board removes a significant shareholder's direct representation and influence on the company's governance.

Future Outlook

No forward-looking statements or guidance are provided in this filing.

Management Comments

• Reporting Persons have determined that they no longer hold any securities for the purpose of or with the effect of changing or influencing the control of the Issuer.

Industry Context

StockSavvy.ai notes that the transition from a Schedule 13D to a Schedule 13G filing typically signals a reduction in activist pressure on a company. This move by Northern Right Capital and Matthew Drapkin suggests a shift towards a more passive investment strategy in Great Elm Capital Corp., aligning with a broader trend where some activist investors may disengage from direct board involvement after achieving certain objectives or re-evaluating their strategic approach.

Management Changes

Corporate Governance

Stakeholder Impact

• Shareholders: May see reduced activist pressure and potential for proxy contests, leading to more stable governance. However, the loss of a director representing a significant shareholder could be viewed as a reduction in oversight.
• Management: May experience less direct pressure from a large shareholder, allowing for more focus on long-term strategic execution without immediate activist demands.

Key Dates

Recommendation

The filing primarily details a change in the nature of a significant shareholder's investment from active to passive, coupled with a director's resignation. While the departure of a director can sometimes be a negative signal, the shift to a 13G filing indicates a reduction in potential activist disruption, which could be seen as a stabilizing factor. There are no new financial metrics or strategic updates to warrant a change in investment thesis. Therefore, a "hold" recommendation is appropriate as investors assess the long-term implications of this governance shift.

Keywords

Great Elm Capital Corp, GECC, Northern Right Capital, Matthew Drapkin, Schedule 13G, beneficial ownership, passive investment, director resignation, SEC filing, investment management