XAI Floating Rate & Alternative Income Trust SEC Filings

XAI Floating Rate & Alternative Income Trust’s current sub-adviser, Octagon Credit Investors, is running a proxy campaign urging shareholders to vote AGAINST a proposed new sub-advisory agreement at a special meeting on July 30, 2026. The proposal would replace Octagon with Rockford Tower Asset Management as sub-adviser.

Octagon contends that its stewardship since the Fund’s 2017 inception has produced portfolio outperformance versus relevant indices and peers, and argues that changing to Rockford Tower would primarily increase the adviser XAI’s share of fees without reducing overall management fees or meaningfully changing the Fund’s structure. It criticizes the Board’s process and independence and advocates an alternative plan focused on lower fees, a simplified management structure, potential tenders for shares, and reconstituting the Board to prioritize closing the Fund’s trading discount to net asset value. Octagon is soliciting votes using a BLUE proxy card.

Octagon Credit Investors, an external manager to XAI Floating Rate & Alternative Income Trust (XFLT), is soliciting proxies on a BLUE card for the July 30, 2026 special meeting, asking shareholders to vote against approval of a new investment sub-advisory agreement.

Octagon asserts that, under its stewardship, XFLT’s unlevered underlying asset returns have generally matched or exceeded applicable benchmarks and that the Fund has outperformed CLO-focused closed-end peers on total shareholder return and NAV return year-to-date and over one-, three- and five-year periods. It contends the Fund’s trading discount to NAV stems from Board and adviser decisions on fees, distributions and capital structure, and advocates replacing the Board, lowering fees, stabilizing distributions and addressing the price-to-NAV gap.

XAI Floating Rate & Alternative Income Trust faces a proxy contest over a proposed change in its investment sub-adviser. Octagon Credit Investors, which has sub-advised XFLT since its 2017 launch, has filed materials urging shareholders to vote against approving a new sub-advisory agreement with Rockford Tower, an affiliate of King Street.

Octagon highlights its own 30-year credit track record, management of $31.6 billion in assets and stewardship of XFLT as a CLO-focused closed-end fund with about $580 million in managed assets, a 39.8% leverage ratio and a monthly distribution of $0.225 per share. It cites relative outperformance versus CLO fund peers, more than $230 million distributed to shareholders and periods of trading at or above NAV. Octagon criticizes the board’s process for selecting Rockford Tower, notes that the overall management fee would remain 1.7%, and contrasts this with its own proposal to act as adviser at a 1.3% fee and a broader "Shareholder Value Enhancement Plan" aimed at higher distributions and narrowing the discount to NAV.

Octagon Credit Investors has filed a definitive Schedule 14A and a BLUE proxy card urging XFLT shareholders to vote AGAINST a Board proposal to replace Octagon with Rockford Tower as the Fund’s sub-adviser at a special meeting on July 30, 2026. Octagon says it outperformed peers since the Fund’s 2017 inception, grew assets to nearly $580 million, earned a Five‑Star Morningstar rating in 2025, and offered to cut the Fund’s overall management fee from 1.7% to 1.3% while simplifying the adviser structure. Octagon contends Rockford Tower is unproven and that the proposed change would leave shareholders paying the same total fee while XAI would retain more revenue; Octagon proposes alternative actions including share repurchases or a tender offer to narrow the discount to NAV.

Octagon Credit Investors, LLC is soliciting proxies and urging XAI Floating Rate & Alternative Income Trust (XFLT) shareholders to vote AGAINST approval of the proposed King Street Sub-Advisory Agreement at a Special Meeting scheduled for July 30, 2026. Octagon states it beneficially owns approximately 64,000 Common Shares (including 60,000 held directly), or about 0.4% of outstanding Common Shares, and intends to vote its shares against the proposal.

Octagon argues the Board and adviser (XAI) have not justified replacing Octagon with Rockford Tower, questions process and oversight, and contends shareholders were not given full context for the decision. The solicitation materials outline Octagon’s tenure since the Fund’s 2017 IPO, growth in managed assets from roughly $73M at IPO to approximately $580–589M, and request that shareholders use the enclosed BLUE proxy card to vote against the King Street Sub-Advisory Agreement.

Octagon Credit Investors intends to solicit XFLT shareholders to vote AGAINST a proposed sub-advisory agreement replacing Octagon with Rockford Tower at XAI Floating Rate & Alternative Income Trust's special meeting. Octagon says Rockford Tower is newly formed and lacks an independent public closed-end fund track record, and urges shareholders to disregard XFLT's proxy materials until Octagon's blue proxy card and full proxy statement are available. Octagon notes it has served as sub-adviser since the Fund's 2017 inception, highlights a Morningstar five-star rating in 2025, and states it directly beneficially owns 60,000 Common Shares while Lauren Law owns 4,000 Common Shares. The Special Meeting is scheduled for July 30, 2026.