XAI Floating Rate & Alternative Income Trust · NYSE:XFLT

XAI Floating Rate & Alternative Income Trust — Proxy Contest (July 2026)

45 slides from XAI Floating Rate & Alternative Income Trust's proxy contest presentation, Jul 13, 2026

  1. Slide 1: XFLT Shareholders Should Vote AGAINST the King Street Sub-Advisory Agreement

    INVESTOR PRESENTATION JULY 2026 XFLT’s Special Meeting of Shareholders XFLT Shareholders Should Vote AGAINST the King Street Sub - Advisory Agreement

  2. Slide 2: What Is This Proxy Fight About?

    Should shareholders entrust XFLT’s portfolio to an asset manager that has never managed a publicly traded closed - end fund? 2 What Is This Proxy Fight About? XFLT’s Board is asking shareholders to vote on a proposal to replace Octagon, the Fund’s longstanding and experienced sub - advise r, with Ro

  3. Slide 3: Table of Contents

    3 Table of Contents 01 Executive Summary PAGE 4 02 Octagon Is an Experienced and Highly Qualified Sub-Adviser PAGE 8 03 Octagon Is a Judicious Steward of Shareholder Capital PAGE 12 04 We Believe the Board Has Failed to Present a Compelling Case for Replacing the Fund's Sub-Adviser PAGE 24 05 We Bel

  4. Slide 4: Executive Summary

    Executive Summary @©ocetagon =

  5. Slide 5: Octagon Credit Investors is a specialized credit investment manager

    5 1. As of May 31, 2026. 2. On a 7-year and 10-year basis as of March 31, 2026, Octagon is among the top ten CLO managers based on combined new issue, reset, and refinancing US CLO volume by dollar amount (excluding middle market CLOs). Source: Pitchbook LCD (March 31, 2026). Octagon Credit Investor

  6. Slide 6: Overview of XAI Floating Rate & Alternative Income Trust

    6 Source: Bloomberg, FactSet and Fund filings. 1. As of July 9, 2026. 2. As of March 31, 2026. XFLT is a publicly listed, closed - end credit fund, providing public investors with access to Octagon - managed floating - rate senio r secured loans and structured credit investments Overview of XAI Floa

  7. Slide 7: We Urge XFLT Shareholders to Vote the BLUE Proxy Card AGAINST the King Street Sub-Advisory Agreement

    7 1. As of July 9, 2026. 2. Although the Fund has since lost its 5 - star rating due to market turmoil, XFLT remains the highest rated fund among its CLO Fund Peers. 3. Source: Hema Parmar, Katherine Burton, Eliza Ronalds - Hannon and Jack Sidders, “King Street’s Poor Returns, Partner Exits Spur Fi

  8. Slide 8: Octagon Is an Experienced and Highly Qualified Sub-Adviser

    02 Octagon Is an Experienced and Highly Qualified Sub-Adviser

  9. Slide 9: Octagon Has a Longstanding History with XFLT and Is Directly Responsible for Its Success

    9 Octagon has served as XFLT's investment sub-adviser since inception and is responsible for the Fund's disciplined portfolio management and outperformance Octagon Has a Longstanding History with XFLT and Is Directly Responsible for Its Success ▪ Octagon partnered with XAI to launch XFLT in 2017, be

  10. Slide 10: XAI and XFLT Have Spoken Highly of Octagon

    10 As recently as April 2026, XAI and XFLT praised Octagon's capabilities, experience and market expertise XAI and XFLT Have Spoken Highly of Octagon... "Most of you are likely already familiar with the sub-adviser on the fund, Octagon Credit. So you know their history, their expertise, the successf

  11. Slide 11: And Consistently Praised Its Performance and Positioning of XFLT

    11 ...And Consistently Praised Its Performance and Positioning of XFLT "[W]e're pleased with the [Fund's] performance. Octagon has done a terrific job managing the fund in the 2024 calendar year." Kimberly Flynn, President, XA Investments Q3 2024 Earnings Call December 6, 2024 "Octagon is a fantasti

  12. Slide 12: Octagon Is a Judicious Steward of Shareholder Capital

    03 Octagon Is a Judicious Steward of Shareholder Capital

  13. Slide 13: XFLT Has Delivered Superior Total Shareholder Returns

    13 Source: Bloomberg. Data as of May 19, 2026, the last trading day prior to XFLT's public disclosure of the proposed sub-adviser transition. Peer data refers to median. 1. "CLO Fund Peers" include Carlyle Credit Income Fund (CCIF), Eagle Point Credit Company (ECC), OFS Credit Company (OCCI), Oxford

  14. Slide 14: And Net Asset Value Returns

    14 Source: Bloomberg and fund filings. Data as of April 30, 2026. Peer data refers to median. 1. "CLO Fund Peers" include Carlyle Credit Income Fund (CCIF), Eagle Point Credit Company (ECC), OFS Credit Company (OCCI), Oxford Lane Capital (OXLC), Pearl Diver Credit Company (PDCC) and Sound Point Meri

  15. Slide 15: Consistent and Attractive Distributions to Shareholders

    15 Source: Fund filings. Under Octagon's stewardship, XFLT has distributed more than $230 million to shareholders, providing steady income consistent with the Fund's core mandate ...And Consistent and Attractive Distributions to Shareholders Monthly Distribution as a Percentage of Average Daily NAV

  16. Slide 16: The LSTA Leveraged Loan 100 Index Is Not an Appropriate Measure of Sub-Adviser Skill

    16 1. See XFLT Webinar, June 30, 2026 ("Now, the benchmark for XFLT is the Morningstar LSTA100 Index, and has been the benchmark for the fund since inception. And so, this underperformance in several different time periods, has led us to make the change, or the proposed change here."). 2. Note: The

  17. Slide 17: Unlevered returns of XFLT's underlying assets have outperformed benchmarks

    17 1. Year to date reflects the period from January 1, 2026 to May 31, 2026. 2. Total Return figures calculated by compounding daily returns, which are calculated as daily P&L attributable to an asset type divided by the beginning of day market value of the asset type in the XFLT portfolio. Performa

  18. Slide 18: XFLT Has a Long History of Trading at or Above NAV

    18 1. Source: Bloomberg, FactSet and Fund filings. Price and NAV data as of July 9, 2026. 2. Source: FactSet and fund filings. Price data as of July 9, 2026. NAV data as of most recently disclosed period: July 9, 2026 for XFLT; April 30, 2026 for OXLC; May 31, 2026 for all others. “CLO Fund Peers” i

  19. Slide 19: Octagon Has Consistently Grown XFLT's Net Assets

    19 Source: Fund filings. Peer data refers to median. 1. Data as of the fiscal year ended in the applicable calendar year. 2. "CLO Fund Peers" include Carlyle Credit Income Fund (CCIF), Eagle Point Credit Company (ECC), OFS Credit Company (OCCI) and Oxford Lane Capital (OXLC). Pearl Diver Credit Comp

  20. Slide 20: XFLT Grown into One of the Largest and Most Liquid Public CLO-Focused Funds

    20 Source: Bloomberg, FactSet and fund filings. “CLO Fund Peers” include Carlyle Credit Income Fund (CCIF), Eagle Point Credit C omp any (ECC), OFS Credit Company (OCCI), Oxford Lane Capital (OXLC), Pearl Diver Credit Company (PDCC) and Sound Point Meridian Cap ital (SPMC). 1. As of April 30, 2026.

  21. Slide 21: The Macroeconomic Environment for CLO Funds Has Been Challenging

    21 1. Source: Federal Reserve Bank of St. Louis. Data runs daily from January 2, 2024 to June 30, 2026. 2. Source: Pitchbook LDC, "US Leveraged Loan Index Factsheet," June 1, 2026. Data runs monthly from January 2024 to June 2026. Rate cuts and loan spread compression have weighed on CLO equity perf

  22. Slide 22: Octagon Has Successfully Navigated This Period of Significant Disruption

    22 Source: Bloomberg and fund filings. Peer data refers to median. 1. "CLO Fund Peers" include Carlyle Credit Income Fund (CCIF), Eagle Point Credit Company (ECC), OFS Credit Company (OCCI) and Oxford Lane Capital (OXLC). Pearl Diver Credit Company (PDCC) and Sound Point Meridian Capital (SPMC) excl

  23. Slide 23: Octagon Has Earned Third-Party Accolades for Its Performance

    23 Independent observers and industry experts have recognized Octagon's stewardship of XFLT Octagon Has Earned Third-Party Accolades for Its Performance XFLT was recently named a finalist for the "Best Public Closed-End CLO Fund" by Creditflux... ...and earned a five-star rating from Morningstar in

  24. Slide 24: Board Has Failed to Present a Compelling Case for Replacing the Sub-Adviser

    04 We Believe the Board Has Failed to Present a Compelling Case for Replacing the Fund's Sub-Adviser

  25. Slide 25: Rockford Tower Is Unqualified to Serve as Sub-Adviser of XFLT

    25 1. Octagon has invested in CLO tranches since 2007 (CLOs issued prior to 2009 were permitted to invest in the mezzanine debt tranches of other managers' CLOs) and has managed dedicated CLO tranche funds/accounts since 2014. 2. As of May 31, 2026. In our view, Rockford Tower lacks Octagon's track

  26. Slide 26: Rockford Tower's Parent Company, King Street, Is Facing Significant Challenges

    26 1. Source: Hema Parmar, Katherine Burton, Eliza Ronalds-Hannon and Jack Sidders, "King Street's Poor Returns, Partner Exits Spur Firmwide Revamp," Bloomberg, June 26, 2026. King Street appears to be struggling, with Bloombergreporting "lackluster performance, fleeing clients and an exodus of long

  27. Slide 27: Change in Sub-Adviser Will Not Reduce Overall Management Fees

    27 Under the King Street Sub-Advisory Agreement, XAI's share of the management fee will increase by 10 bps; Octagon proposed cutting fees by over 20% The Change in Sub-Adviser Will Not Reduce Overall Management Fees; However, XAI Stands to Earn More Share of Management Fee on XFLT Assets ▪ Rockford

  28. Slide 28: XFLT's Claims Regarding Rockford Tower's Proposed Initiatives Are Unavailing

    28 1. Source: XFLT Webinar, June 30, 2026. 2. Source: XFLT Definitive Proxy Statement, filed with the SEC on June 23, 2026. In our view, Rockford Tower's proposed initiatives are unlikely to generate the benefits XFLT claims XFLT's Claims Regarding Rockford Tower's Proposed Initiatives Are Unavailin

  29. Slide 29: XFLT's Own Statements Contradict Its Purported Reasons for Replacing Octagon

    29 1. Source: XFLT Definitive Proxy Statement, filed with the SEC on June 23, 2026. 2. Source: XFLT CQ2 2022 Earnings Call, August 17, 2022. 3. Source: XFLT Form N-CSR, filed with the SEC on December 1, 2025. 4. Source: XFLT CQ2 2023 Earnings Call, August 22, 2023. XFLT's remarks suggest that the pu

  30. Slide 30: The NAV Gap Widened When Shareholders Learned Octagon Was Being Replaced

    30 Source: Fund filings. Data runs from May 1, 2026 to July 9, 2026. Shareholders seemingly lack confidence that Rockford Tower can improve the performance of XFLT The NAV Gap Widened When Shareholders Learned That Octagon Was Being Replaced and Narrowed When Octagon Publicly Opposed This Move XFLT

  31. Slide 31: Board Is Ill-Suited to Make This Consequential Decision

    05 We Believe the Board Is Ill-Suited to Make This Consequential Decision

  32. Slide 32: XFLT's Board Is Seemingly Ill-Equipped to Make this Critical Decision

    32 The disinterested trustees appear to lack the attributes necessary to make a critical decision about Fund portfolio management XFLT's Board Is Seemingly Ill-Equipped to Make this Critical Decision Attributes Trustee Primary Industry Background Independent of XAI Credit Investing Expertise Direct

  33. Slide 33: Board Made Its Decision Without Adequate Due Diligence

    33 In our view, the Board's change in XFLT's sub-adviser was rash and uninformed We Believe the Board Made Its Decision to Change XFLT's Sub-Adviser Without Adequate Due Diligence ▪ Only after it voted to remove Octagon as XFLT's sub-adviser did the Board request from Octagon any performance benchma

  34. Slide 34: XAI and the XFLT Board Regularly Rebuffed and Ignored Octagon

    34 Octagon was regularly cut out of important decisions, and its input and judgment largely ignored by XAI and the XFLT Board XAI and the XFLT Board Regularly Rebuffed and Ignored Octagon Topic Description XAI / XFLT Board's Response Investment in Higher- Yielding Loan Assets Octagon sought to expan

  35. Slide 35: Conclusion

    06 oe. Conclusion @©ocetagon =

  36. Slide 36: We Urge XFLT Shareholders to Vote the BLUE Proxy Card AGAINST the King Street Sub-Advisory Agreement

    36 1. As of July 9, 2026. 2. Although the Fund has since lost its 5 - star rating due to market turmoil, XFLT remains the highest rated fund among its CLO Fund Peers. 3. Source: Hema Parmar, Katherine Burton, Eliza Ronalds - Hannon and Jack Sidders, “King Street’s Poor Returns, Partner Exits Spur Fi

  37. Slide 37: A Better Alternative Exists for Shareholders

    37 We believe there is a better path for XFLT shareholders to maximize the value of their investment—but first, they must reject the proposed sub-adviser transition A Better Alternative Exists for Shareholders ▪ XFLT needs shareholder approval to appoint a new sub-adviser — The Board cannot appoint

  38. Slide 38: A Better Alternative Exists for Shareholders (Continued)

    38 If appointed as XFLT's adviser, Octagon intends to implement a Shareholder Value Enhancement Plan aimed at increasing Fund distributions, closing the discount to NAV and enhancing Fund returns A Better Alternative Exists for Shareholders (Continued) Proposed Initiative Description Reduce Manageme

  39. Slide 39: Appendix A: Important Information

    07 Appendix A: Important Information

  40. Slide 40: Important Information: Certain Information Concerning the Participants

    40 CERTAIN INFORMATION CONCERNING THE PARTICIPANTS Important Information Octagon Credit Investors, LLC ("Octagon"), together with Gretchen Lam and Lauren Law (collectively, the "Participants"), has filed a definitive proxy statement on Schedule 14A, accompanying BLUE proxy card, and other relevant d

  41. Slide 41: Cautionary Statement Regarding Forward-Looking Statements

    41 CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS Important Information (Continued) The information herein contains "forward-looking statements." Specific forward-looking statements can be identified by the fact that they do not relate strictly to historical or current facts and include,

  42. Slide 42: Disclaimer

    42 DISCLAIMER Important Information (Continued) The information contained herein is provided for discussion and general informational purposes only and does not constitute an offering or the solicitation of an offer to purchase an interest in any investment. The views expressed herein are those of O

  43. Slide 43: Appendix B: Octagon Investment Team Overview

    07 Appendix B: Octagon Investment Team Overview

  44. Slide 44: Octagon Has a Strong, Experienced Portfolio Management and Investment Team

    44 Octagon's senior investment professionals have decades of experience managing funds through various market cycles Octagon Has a Strong, Experienced Portfolio Management and Investment Team Gretchen M. Lam, CFA Chief Executive Officer 27 Years of Experience Ms. Lam is Octagon's Chief Executive Off

  45. Slide 45: For Media / For Investors

    FOR MEDIA FOR INVESTORS Dan Gagnier / Riyaz Lalani Gagnier Communications (646) 342 - 8087 [email protected] John Ferguson / Joe Mills Saratoga Proxy Consulting LLC (212) 257 - 1311 / (888) 368 - 0379 [email protected]

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