The XFLT Proxy Contest: What XFLT Shareholders Need to Know

XA Investments LLC, manager of XAI Floating Rate & Alternative Income Trust (XFLT) (the “Fund”), provides answers to shareholders’ questions regarding the approval of a new investment sub-advisory agreement among the Fund, XA Investments LLC and Rockford Tower Asset Management, L.L.C. (the “King Street Sub-Adviser”), a wholly owned subsidiary of King Street Capital Management, L.P. (“King Street”) in the upcoming Special Meeting of Shareholders on July 30, 2026. Q: Why did the Board select the King Street Sub-Adviser to be the new sub-adviser for XFLT? The Board had a fiduciary responsibility to protect shareholders from Octagon’s persistent underperformance at XFLT. Therefore, it commenced a comprehensive process to identify a qualified sub-adviser that could improve future shareholder outcomes. The Board selected the King Street Sub-Adviser due to a number of factors, including: The strength of King Street’s CLO business. King Street’s deep bench of investment talent. The King Street Sub-Adviser’s ability to execute the Fund’s strategy in a more dynamic manner, including across U.S. and European CLO debt and equity assets, within the Fund’s stated investment objective. XA Investments and the Board firmly believe the King Street Sub-Adviser is better positioned to improve performance, support stronger distributions over time and help unlock greater value for shareholders. Q: How poor was XFLT’s performance under Octagon? The results were significant. As of March 31, 2026: XFLT underperformed its benchmark by -19.09% over one year. XFLT also underperformed over the three-year, five-year and since-inception periods. XFLT’s NAV per share declined approximately -54%, which implies $406.7 million of current-share-equivalent NAV-per-share erosion. In addition, recent developments affirm that the Board was right to be concerned. Beyond XFLT, Octagon’s own CLO portfolio has suffered seven CLO defaults in 2026. Q: What are the benefits to XFLT shareholders if the Proposal is approved? The Board believes that the approval of the King Street Sub-Adviser agreement will provide a number of benefits that will help improve the Fund’s performance over time: Potential for increased distributions and improved performance over time. Expanded opportunity set—more varied investment opportunities in different parts of the U.S. and European credit market. A qualified manager that is a wholly owned subsidiary of King Street, which has an institutional track record of skill and experience investing in the U.S. and global credit markets with investment professionals based in the U.S., London, Singapore and Dubai. Dynamic management between different and potentially new opportunities in the credit market in a timely manner. Q: Who is the King Street Sub-Adviser? Founded in 1995, King Street is a leading global alternative asset manager that, along with its affiliates, manages $30 billion assets across multiple segments of the public and private markets. King Street’s CLO platform includes: 20 U.S. CLOs 9 European CLOs Approximately $12 billion in CLO assets under management. Rockford Tower Asset Management, L.L.C., the proposed sub-adviser for XFLT, is a wholly owned subsidiary of King Street. Q: Will there be changes to the Fund’s management fees borne by shareholders? No . The Trust will continue to pay XA Investments the current 1.7% investment advisory fee. The Trust’s management fees and expenses...