XAI Octagon Floating Rate & Alternative Income Trust Declares its Monthly Common Shares Distribution of $0.060 per Share

Rhea-AI Summary

XAI Octagon Floating Rate & Alternative Income Trust (NYSE: XFLT) declared a monthly common share distribution of $0.060 per share, payable March 2, 2026, to holders of record on February 17, 2026. The distribution amount is unchanged from the prior month.

The Trust noted distributions may be sourced from net investment income, capital gains, or return of capital; tax characteristics will be reported on Form 1099 after 2026. The Trust invests primarily in floating rate and structured credit, targeting income and total return, and may adjust distributions based on income, covenants, or solvency considerations.

Positive

• Maintains monthly distribution of $0.060 per share
• Payable date set for March 2, 2026 (record Feb 17, 2026)

Negative

• Distributions may include return of capital, reducing tax basis
• Distributions can exceed net investment income in a period
• 4% excise tax risk if required distributions not made

News Market Reaction – XFLT

-1.14%

-1.14% Session close to close

In the Feb 3 session, XFLT declined 1.14%, reflecting a mild negative market reaction.

Data tracked by StockTitan Argus on the day of publication.

Market Context

This announcement confirms a regular monthly distribution of $0.060 per share, unchanged from the pr...

Analysis

This announcement confirms a regular monthly distribution of $0.060 per share, unchanged from the prior month, with an ex-dividend and record date of February 17, 2026 and payment on March 2, 2026. It reiterates that payouts may include income, gains, or return of capital and highlights complex U.S. GAAP versus tax treatments, especially for CLO holdings. Investors may watch future distribution levels, tax character on Form 1099, and portfolio performance across the credit cycle.

Key Figures

Monthly distribution: $0.060 per share Prior month distribution: $0.060 per share Ex-dividend date: February 17, 2026 +5 more

8 metrics

Monthly distribution $0.060 per share Declared for March 2, 2026 payment to holders of record Feb 17, 2026

Prior month distribution $0.060 per share Previous month’s common share distribution, unchanged this month

Ex-dividend date February 17, 2026 Ex-dividend and record date for the $0.060 monthly payout

Payment date March 2, 2026 Scheduled payment date for declared monthly distribution

Distribution decrease 14.29% Reduction from $0.070 to $0.060 per share announced Jan 2, 2026

Annualized distribution rate 15.00% on price On market price as of Dec 31, 2025, after cut to $0.060

Annualized distribution rate 13.48% on NAV On NAV as of Dec 31, 2025, after cut to $0.060

Excise distribution requirement 98% / 98.2% Required ordinary income and capital gain payout thresholds to avoid 4% excise tax

Historical Context

5 past events · Latest: Jan 08 (Positive)

Pattern 5 events

Date	Event	Sentiment	24h Move	Catalyst
Jan 08	Index launch	Positive	+0.4%	Launch of INTVL-C alternative credit interval fund index benchmark.
Jan 06	Platform distribution	Positive	+0.8%	OCTIX interval fund added to Charles Schwab platform with income focus.
Jan 02	Distribution cut	Negative	-1.1%	Monthly payout reduced to $0.060 from $0.070 per share.
Dec 29	Index expansion	Positive	-0.9%	Announcement of upcoming INTVL-C index expanding benchmark suite.
Dec 01	Monthly distribution	Neutral	+0.4%	Maintained $0.070 monthly distribution with standard tax disclosures.

24h Move is the share-price change in the day after each event; other market factors may also have contributed.

Pattern Detected

Recent news-driven moves mostly aligned with sentiment, with one divergence on an index expansion headline.

Recent Company History

Over the last few months, XFLT news has focused on distributions and XA Investments’ index and fund initiatives. A prior cut to the monthly distribution to $0.060 per share on Jan 2, 2026 drew a negative price reaction of -1.05%. In contrast, index launches and platform access announcements in Dec 2025–Jan 2026 generally coincided with modest gains. Today’s unchanged $0.060 monthly distribution follows that reset and fits the trust’s stated goal of stable payouts.

Key Terms

return of capital, form 1099, u.s. gaap, excise tax, +4 more

8 terms

return of capital financial

"all or a portion of a distribution may be a return of capital, which is in effect a partial"

Return of capital is when an investor receives money from their investment that is not considered profit or earnings but rather a portion of the original amount they invested. It’s similar to getting back part of your initial savings rather than gains from it. This matters because it can affect how much money an investor still has in the investment and may have tax implications.

form 1099 regulatory

"tax characteristics of the distributions will be reported ... on Form 1099 after the end"

Form 1099 is a set of U.S. tax forms used by financial institutions and payers to report income paid to an individual or entity that isn’t a regular paycheck, such as dividends, interest, bond or stock sale proceeds, and certain miscellaneous payments. For investors it acts like a formal receipt summarizing taxable events for the year, so it matters for calculating tax liability, verifying broker statements, and keeping accurate records of after‑tax returns.

u.s. gaap financial

"financial reporting purposes under accounting principles generally accepted in the United States (“U.S. GAAP”)"

U.S. GAAP is a set of rules and standards that companies in the United States follow to prepare their financial reports. It helps ensure that financial information is consistent and clear, so investors and others can compare and understand a company's financial health easily.

excise tax regulatory

"the Trust is subject to a 4% excise tax that is imposed if the Trust does not distribute"

An excise tax is a government charge levied on specific goods or activities—often applied per unit or as a percentage of price for items like fuel, tobacco, alcohol, or certain services—similar to a per-item toll added at the point of sale. It matters to investors because excise taxes raise costs for producers and consumers, can shrink profit margins or reduce demand, and therefore may affect a company’s revenues, pricing strategy and valuation.

ex-dividend date financial

"--- Table Start --- Ex-Dividend Date | February 17, 2026"

The ex-dividend date is the date when a stock starts trading without the value of its next dividend payment included. If you buy the stock on or after this date, you won't receive that upcoming dividend; only those who owned the stock before this date are entitled to it. It matters to investors because it determines who is eligible to receive the dividend and can influence the stock’s price around that time.

View in glossary

record date financial

"payable on March 2, 2026, to common shareholders of record as of February 17, 2026"

The record date is the specific day when a company determines which shareholders are eligible to receive a dividend or participate in an upcoming vote. It’s like a cutoff date; if you own the stock on that day, you get the benefits or voting rights. This date matters because it decides who qualifies for certain company benefits.

managed assets financial

"Under normal market conditions, the Trust will invest at least 80% of its Managed Assets"

Managed assets are the financial investments—such as stocks, bonds, cash, or real estate—that a professional firm or advisor oversees and makes decisions about on behalf of clients. They matter to investors because the amount and performance of these assets influence a manager’s revenue, reputation, and the client’s potential returns, much like the size and health of a garden reflect a gardener’s skill and likely harvest.

structured credit investments financial

"80% of its Managed Assets in floating rate credit instruments and other structured credit investments"

Structured credit investments are securities created by bundling many loans or other debts and then slicing that bundle into pieces with different levels of risk and reward, like cutting a layered cake where some slices get paid first and others absorb losses. They matter to investors because they can offer higher income and a way to spread risk across many borrowers, but they are complex and can hide credit, timing and liquidity risks that affect returns.

AI-generated analysis. How Rhea-AI works. Not financial advice.

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CHICAGO, Feb. 02, 2026 (GLOBE NEWSWIRE) -- XAI Octagon Floating Rate & Alternative Income Trust (the “Trust”) has declared its regular monthly distribution of $0.060 per share on the Trust’s common shares (NYSE: XFLT), payable on March 2, 2026, to common shareholders of record as of February 17, 2026, as noted below. The amount of the distribution represents no change from the previous month’s distribution amount of $0.060 per share.

The following dates apply to the declaration:

Ex-Dividend Date	February 17, 2026
Record Date	February 17, 2026
Payable Date	March 2, 2026
Amount	$0.060 per common share
Change from Previous Month	No Change

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”.

About XA Investments

XA Investments LLC (“XAI”) serves as the Trust’s investment adviser. XAI is a Chicago-based firm founded by XMS Capital Partners in 2016. XAI serves as the investment adviser for two listed closed-end funds and an interval closed-end fund. The listed closed-end funds, the XAI Octagon Floating Rate & Alternative Income Trust and XAI Madison Equity Premium Income Fund both trade on the New York Stock Exchange and the interval fund, Octagon XAI CLO Income Fund is available via direct subscription and through select broker/dealers and wealth management platforms.

In addition to investment advisory services, the firm also provides investment fund structuring and consulting services focused on registered closed-end funds to meet institutional client needs. XAI offers custom product build and consulting services, including development and market research, sales, marketing, and fund management.

XAI believes that the investing public can benefit from new vehicles to access a broad range of alternative investment strategies and managers. XAI provides individual investors with access to institutional-caliber alternative managers. For more information, please visit www.xainvestments.com.

About XMS Capital Partners
XMS Capital Partners, LLC, established in 2006, is a global, independent, financial services firm providing M&A, corporate advisory and asset management services to clients. It has offices in Chicago, Boston and London. For more information, please visit www.xmscapital.com.

About Octagon Credit Investors
Octagon Credit Investors, LLC (“Octagon”) serves as the Trust’s investment sub-adviser. Octagon is a 30+ year old, $33.2B below-investment grade corporate credit investment adviser focused on leveraged loan, high yield bond and structured credit (CLO debt and equity) investments. Through fundamental credit analysis and active portfolio management, Octagon’s investment team identifies attractive relative value opportunities across below-investment grade asset classes, sectors and issuers. Octagon’s investment philosophy and methodology encourage and rely upon dynamic internal communication to manage portfolio risk. Over its history, the firm has applied a disciplined, repeatable and scalable approach in its effort to generate attractive risk-adjusted returns for its investors. For more information, please visit www.octagoncredit.com.

XAI does not provide tax advice; please consult a professional tax advisor regarding your specific tax situation. Income may be subject to state and local taxes, as well as the federal alternative minimum tax.

Investors should consider the investment objectives and policies, risk considerations, charges and expenses of the Trust carefully before investing. For more information on the Trust, please visit the Trust’s webpage at www.xainvestments.com.

This press release shall not constitute an offer to sell or a solicitation to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer or solicitation or sale would be unlawful prior to registration or qualification under the laws of such state or jurisdiction.

NOT FDIC INSURED	NO BANK GUARANTEE	MAY LOSE VALUE

Paralel Distributors, LLC - Distributor

Media Contact:
Kimberly Flynn, President
XA Investments LLC
Phone: 888-903-3358
Email: KFlynn@XAInvestments.com
www.xainvestments.com

FAQ

What distribution did XFLT declare for March 2026 and when is it payable?

XFLT declared a monthly distribution of $0.060 per share, payable March 2, 2026. According to the company, shareholders of record on February 17, 2026 are eligible and the amount is unchanged from the prior month.

When is the ex-dividend and record date for XFLT's March 2026 distribution (NYSE: XFLT)?

The ex-dividend and record date for the March 2026 distribution is February 17, 2026. According to the company, shareholders on that date will be entitled to the March 2, 2026 payment.

Is XFLT's $0.060 distribution taxable and how will tax information be reported?

Taxability depends on the distribution source; portions may be return of capital rather than ordinary income. According to the company, tax characteristics will be reported to shareholders on Form 1099 after the 2026 calendar year.

Could XFLT's monthly distribution reduce shareholder tax basis or affect future gains?

Yes. A return of capital portion reduces a shareholder's tax basis, impacting future gain or loss on sale. According to the company, distributions that are return of capital will lower cost basis until fully recovered.

How does XFLT fund distributions and what risks affect future payouts (Ticker: XFLT)?

Distributions may come from net investment income, capital gains, or return of capital, and may exceed period income. According to the company, future payments depend on income, cash, covenants, and solvency considerations, so amounts can change.