XS Cargo Income Fund Receives Unitholder and Court Approvals for Previously Announced Plan of Arrangement

XS Cargo Income Fund (TSX VENTURE:XSC.UN) (the "Fund" or "XS Cargo") is pleased
to announce that it has received unitholder and court approval for its
previously announced plan of arrangement (the "Arrangement"), pursuant to which,
among other things, XSC Canada Holdings Inc. ("Holdings"), a wholly-owned
indirect subsidiary of KarpReilly LLC, will acquire the Fund's 51% interest in
each of XS Cargo Limited Partnership (the "LP") and XS Cargo GP Inc. (the "GP"),
for gross cash consideration of $5,332,019 (the "Purchase Price"). Pursuant to
the Arrangement, Holdings will also acquire the remaining 49% interest in the LP
and the GP held by Famous Brands (Edmonton) Inc., a company controlled by Mr.
Michael McKenna, a director and the President and Chief Executive Officer of the
GP, which is the administrator of the Fund and the general partner of the LP. 


In excess of 99.9% of the units and special voting units cast at the unitholder
meeting held to consider the Arrangement were voted in favour of the
Arrangement. The Arrangement is currently scheduled to close on May 31, 2011.
Pursuant to the Arrangement, the Fund will be wound-up and the Purchase Price
will be distributed to unitholders of the Fund on a pro rata basis after the
payment of all transaction and wind-up costs and expenses. The wind-up of the
Fund and the redemption of the Fund's units is expected to occur on or about
June 15, 2011. The Fund will then submit notice to the TSX Venture Exchange (the
"Exchange") to have the Fund's units de-listed from the Exchange. Further
information with respect to the amount to be distributed to unitholders on the
redemption of the units, and the timing of wind-up and redemption will be
provided in due course. 


Business of the Fund

The Fund is an unincorporated open-ended trust created to invest in the
broadline closeout retail business through an indirect controlling interest of
the LP which through its general partner, the GP, operates 42 closeout retail
stores in Alberta, British Columbia, Manitoba, Saskatchewan, Ontario,
Newfoundland, Nova Scotia and New Brunswick.


About KarpReilly, LLC

KarpReilly, LLC is a private investment firm, whose primary mission is to
partner with premier small to mid-size growth companies and help them achieve
their long-term vision. KarpReilly currently manages funds and affiliates with
initial capital commitments totaling $310 million. Over the past 15 years, the
principals of KarpReilly have invested in, sat on the boards of and nurtured
over 25 consumer growth companies. Among the notable discount and closeout
retail companies that the principals of KarpReilly have invested in are Dollar
Tree Stores, Ollie's Bargain Outlet, and Bob's Discount Furniture among others.
For more information, please visit www.karpreilly.com.


Forward-Looking Statements

Certain statements contained in this document constitute forward-looking
statements or information (collectively "forward-looking statements") within the
meaning of the "safe harbour" provisions of applicable securities legislation.
Forward-looking statements are typically identified by words such as "will" and
"expect" and similar words suggesting future events or future performance. In
particular, this document contains forward-looking statements pertaining to,
without limitation, the proposed timing for closing the Arrangement, the
anticipated timing for the wind-up of the Fund and the distribution of the
Purchase Price to unitholders of the Fund and the anticipated delisting of the
Fund's units on the Exchange. With respect to forward-looking statements
contained in this document, the Fund has made assumptions regarding, among other
things, the ability to satisfy all conditions precedent to closing the
Arrangement and the ability to satisfy the payment of all transaction and
wind-up costs and expenses by June 15, 2011. Although the Fund believes that the
expectations reflected in the forward-looking statements contained in this
document, and the assumptions on which such forward-looking statements are made,
are reasonable, there can be no assurance that such expectations will prove to
be correct. Readers are cautioned not to place undue reliance on forward-looking
statements included in this document, as there can be no assurance that the
plans, intentions or expectations upon which the forward-looking statements are
based will occur. By their nature, forward-looking statements involve numerous
assumptions, known and unknown risks and uncertainties that contribute to the
possibility that the predictions, forecasts, projections and other
forward-looking statements will not occur, which may cause the Fund's actual
performance and financial results in future periods to differ materially from
any estimates or projections of future performance or results expressed or
implied by such forward-looking statements. These risks and uncertainties
include, among other things, that the closing conditions for the Arrangement may
not be satisfied and that closing of the Arrangement may be delayed or may not
occur at all. Readers are cautioned that this list of risk factors should not be
construed as exhaustive. The forward-looking statements contained in this
document speak only as of the date of this document. Except as expressly
required by applicable securities laws, the Fund does not undertake any
obligation to publicly update or revise any forward-looking statements, whether
as a result of new information, future events or otherwise. The forward-looking
statements contained in this document are expressly qualified by this cautionary
statement.