XAI Octagon Floating Rate & Alternative Income Trust Declares its Monthly Common Shares Distribution of $0.225 per Share

XAI Octagon Floating Rate & Alternative Income Trust (the “Trust”) has declared its regular monthly distribution of $0.225 per common share on the Trust’s common shares (NYSE: XFLT), payable on May 1, 2026, to common shareholders of record as of April 15, 2026, as noted below. With the new distribution amount of $0.225 per share, the Trust’s annualized distribution rate on market price is 15.72%, and the annualized distribution rate on NAV is 12.11% as of market close on March 31, 2026, respectively. “In light of a more challenging market environment for CLO equity investing, we have decreased our monthly distribution to align with the Trust’s near-term earnings potential. The change allows the Trust to retain capital to deploy in future investment opportunities that help drive value for shareholders,” said Kimberly Flynn, President of XA Investments. The following dates apply to the declaration: The Trust will host a market update webinar at 10:00am central on Tuesday, April 14, 2026, to discuss these recent Trust developments and current market conditions in the loan and CLO marketplace. The webinar replay will be available on the Trust’s website soon after the webinar completion. Please register for the webinar here. Over the first quarter of 2026, the Trust has successfully: Conducted a 1-for-5 reverse stock split, which was effective 5:00pm Eastern Time on March 20, 2026. As a result of the reverse stock split, every five (5) common shares issued and outstanding were automatically combined into one (1) issued and outstanding common share, without any change in the par value per share.Declared three regular monthly distributions on January 2, February 2 and March 2, which, adjusted for the reverse stock split, totaled $0.90 per share.Hosted its regular quarterly webinar with Octagon Credit Investors on March 4, 2026 to discuss fourth quarter 2025 Trust performance.Completed a preferred leverage refinancing program that began in Q4 2025 and reduced the Trust’s weighted average preferred coupon expense by 0.80%, from 6.72% to 5.92%, which included: Issuance of $50.0 million of 5.92% Series A Mandatory Redeemable Preferred Shares on October 21, 2025.Redemption of all $29.9 million of the Trust’s 6.50% Series 2026 Term Preferred Shares on October 31, 2025.Issuance of an additional $23.0 million of 5.92% Series A Mandatory Redeemable Preferred Shares on December 18, 2025.Redemption of all $27.5 million of the Trust’s 6.95% Series 2029 Convertible Preferred Shares on January 30, 2026. Common share distributions may be paid from net investment income (regular interest and dividends), capital gains and/or a return of capital. The specific tax characteristics of the distributions will be reported to the Trust’s common shareholders on Form 1099 after the end of the 2026 calendar year. Shareholders should not assume that the source of a distribution from the Trust is net income or profit. For further information regarding the Trust’s distributions, please visit www.xainvestments.com. The Trust’s net investment income and capital gain can vary significantly over time; however, the Trust seeks to maintain more stable common share monthly distributions over time. The Trust’s investments in CLOs are subject to complex tax rules and the calculation of taxable income attributed to an investment in CLO subordinated notes can be dramatically different from the calculation of income for financial reporting purposes under accounting principles generally accepted in the United States (“U.S. GAAP”), and, as a result, there may be significant differences between the Trust’s GAAP income and its taxable income. The Trust’s final taxable income for the current fiscal year will not be known until the Trust’s tax returns are filed. As a registered investment company, the Trust is subject to a 4% excise tax that is imposed if the Trust does not distribute to common shareholders by the end of any calendar year at least the sum of (i) 98% of its ordinary income (not taking into account any capital gain or loss) for the calendar year and (ii) 98.2% of its capital gain in excess of its capital loss (adjusted for certain ordinary losses) for a one-year period generally ending on October 31 of the calendar year (unless an election is made to use the Trust’s fiscal year). In certain circumstances, the Trust may elect to retain income or capital gain to the extent that the Board of Trustees, in consultation with Trust management, determines it to be in the interest of shareholders to do so. The common share distributions paid by the Trust for any particular period may be more than the amount of net investment income from that period. As a result, all or a portion of a distribution may be a return of capital, which is in effect a partial return of the amount a common shareholder invested in the Trust, up to the amount of the common shareholder’s tax basis in their common shares, which would reduce such tax basis. Although a return of capital may not be taxable, it will generally increase the common shareholder’s potential gain, or reduce the common shareholder’s potential loss, on any subsequent sale or other disposition of common shares. The distribution shall be paid on the Payment Date unless the payment of such distribution is deferred by the Board of Trustees upon a determination that such deferral is required in order to comply with applicable law to ensure that the Trust remains solvent and able to pay its debts as they become due and continue as a going concern, or to comply with the applicable terms or financial covenants of the Trust’s senior securities. Future common share distributions will be made if and when declared by the Trust’s Board of Trustees, based on a consideration of number of factors, including the Trust’s continued compliance with terms and financial covenants of its senior securities, the Trust’s net investment income, financial performance and available cash. There can be no assurance that the amount or timing of common share distributions in the future will be equal or similar to that described herein or that the Board of Trustees will not decide to suspend or discontinue the payment of common share distributions in the future. The investment objective of the Trust is to seek attractive total return with an emphasis on income generation across multiple stages of the credit cycle. The Trust seeks to achieve its investment objective by investing in a dynamically managed portfolio of opportunities primarily within the private credit markets. Under normal market conditions, the Trust will invest at least 80% of its Managed Assets in floating rate credit instruments and other structured credit investments. There can be no assurance that the Trust will achieve its investment objective. The Trust’s common shares are traded on the New York Stock Exchange under the symbol “XFLT”.... Read more

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