[UNOFFICIAL TRANSLATION]
This document is an unofficial translation. Only the Japanese text is contractually binding.
When any dispute arises, any judgment shall be based solely on the Japanese text.

Policy Conditions for Overseas Untied Loan (Loan Claims, etc.)
Insurance

April 1, 2017

Chapter 1.

17-Scheme-00011

General Provisions(Contents of these Policy Conditions)
Article 1.
These Policy Conditions shall be the insurance policy conditions applicable toOverseas Untied Loan Insurance, which is a part of the Overseas Untied Loan
Insurance under the provisions of the Trade and Investment Insurance Act (Act No.
67 of 1950, hereinafter referred to as the "Act"), to provide an indemnity for losses
suffered by a party who has acquired any of the Overseas Untied Loan Claims, etc.,
stipulated in Paragraph 18 of Article 2 of the Act.
(Definitions)
Article 2
For the purpose of these Policy Conditions the following terms shall have thefollowing meanings:

-1-

1.

“Nippon Export and Investment Insurance” hereinafter referred to as “NEXI”
means a stock company Nippon Export and Investment Insurance, Co., Ltd.
stipulated in Article 3 of the Act.

2.

“Overseas Untied Loan Claims, etc.” means, any of the following Items which
are provided for in this policy.
a)Claims related to loans which are provided to a foreign government, etc.,
foreign entity, or foreign person in order to finance business funds
necessary for a project operated outside of Japan (excluding claimsprescribed in c below).

b)

Public bonds, commercial paper, or other instruments of a similar nature,
issued by a foreign government, etc. or a foreign entity to finance thebusiness funds as stipulated in Paragraph a) above.

c)

Claims regarding short-term loans which are provided to an overseas
subsidiary of a Japanese small and medium sized enterprise in order tofinance short-term funds necessary for a project operated outside of Japan.

3.

“Overseas Untied Loan” means the acquisition of Overseas Untied Loan Claims,
etc. implemented by a Japanese entity, Japanese person, foreign entity or
foreign person.

4.

“Loan, etc.” means both principal and interest of the Overseas Untied Loan
Claims, etc. which does not include delayed interest or any claims other thanprincipal and interest held by the insured under the Overseas Untied Loan.

5.

“Insurable Value” means the amount of the Loan, etc. If the Loan, etc. is repaid
in two or more installments, “Insurable Value” means the amount to be repaid-2-

in each installment.
6.

“Insured, et al.” means a policy holder, insured or beneficiary of the policy, or its
agent or employee.

Chapter 2.

Scope of Indemnity(Risks to be indemnified)
Article 3.
NEXI shall indemnify the losses suffered by the insured who is unable to collect theLoan, etc. due to a reason which falls under any of the following Items, inaccordance with these Policy Conditions (which term shall hereinafter be deemed toinclude the provisions of any special agreements entered into in conjunction withthese Policy Conditions; the same shall apply hereinafter).
1.

The imposition of a restriction on or the prohibition of foreign exchangetransactions (including foreign exchange and foreign currency remittance) ina foreign country.

2.

The imposition of a restriction on or the prohibition of export or import in thehost country in which the project is implemented.

3.

Delay in foreign currency remittance due to a debt rescheduling agreement
between the governments concerned or which is attributable to the borrower's
country.

4.

Legal provisions adopted in the borrower’s country declaring repayments-3-made in the local currency to be a valid discharge of the debt, regardless ofthe exchange rate, or any other measure or decision by the foreign
government, state government or local authorities to exempt the borrower
from full or partial repayment of the loan.
5.

Expropriation by a foreign government, state government or local authorities.

6.

Any illegal or discriminatory measure or decision by a foreign government,
state government or local authorities to prevent all or part of the repaymentof a debt.

7.

Any economic sanction by the United Nations, other internationalorganization or countries other than the borrower's country.

8.

The occurrence of any of the following events arising outside of Japan:(1)war, revolution, terrorism or other civil commotion, riot, disturbanceor general strike,(2)

windstorm, rain storm, flood, high water, lightning strike, earthquake,
volcanic eruption, tsunami, natural fire or other natural calamities,

9.

(3)

nuclear disaster, or(4)

disruption to transit of goods.

In addition to the events prescribed in the preceding Items, the occurrence of
any other event arising outside of Japan which is not attributable to theinsured or the counterparty to the Overseas Untied Loan.

10.

An order to commence a bankruptcy proceeding against the counterparty to-4-the Overseas Untied Loan (limited to cases where such decision to commencea bankruptcy proceeding has been verified by a foreign public institution).
11.

Delay for three (3) months or more in the performance of payment
obligations by the counterparty to the Overseas Untied Loan (limited tocases where such delay is not attributable to the insured).

Chapter 3.

Amount of Loss and Amount of Indemnity(Amount of loss)
Article 4.
The amount of loss, as prescribed in the provisions of Article 3, shall be the amountnot exceeding the Insurable Value, which is obtained by deducting the amounts
prescribed in the following Items from the amount of the Loan, etc. which cannot becollected by the insured by the due date for repayment due to any of the reasons
stipulated in each of the Items of Article 3 (or by the date falling three (3) months
after the due date for repayment, in the case of the reason stipulated in Item 11 of
Article 3).
1.

The remaining amount obtained by deducting the expenses which have or
shall become necessary for exercising the claim for damages or claim forguarantee obligations, or for taking any other reasonable measures for the
insured to perform its obligations to prevent or mitigate any of the losses inaccordance with the provisions of Paragraph 1 or 2 of Article 16, from theamounts which the insured has obtained (excluding overdue interest) by
exercising such claims or taking such measures, provided that the amount to-5-

be deducted shall not exceed the amount obtained by exercising such claims
or taking such measures.
2.

In addition to the amounts stipulated in the preceding Item, the amounts
which it is no longer necessary for the insured to expend as a result of theoccurrence of an event for which NEXI is responsible for indemnification inaccordance with the provisions of Article 3.

(Amount of indemnity)
Article 5.
The amount to be indemnified by NEXI shall be the amount obtained by multiplying
the balance after the amount indicated in each of the following Items has been
deducted from the loss amount calculated based on the preceding Article, by theratio of the insured amount provided for in this policy to the Insurable Value:1.

if the insured fails to fulfill its obligations stipulated in Paragraph 1 orParagraph 2 of Article 16, the amount proved that it should have secured, orthe amount proved that it should have obtained through compensation or
guarantee of obligations if the insured had fulfilled such obligations; and2.

the amount of loss proved that has been compounded as a result of theinsured’s failure to follow NEXI’s instructions in spite of NEXI giving those
instructions under Article 11.

(Exclusion)
Article 6.
In addition to the matters prescribed in Paragraph 4 of Article19, NEXI shall not be-6-

responsible for indemnifying the following losses:
1.

Any losses which were incurred due to any intentional act or omission or
gross negligence on the part of the Insured, et al.

2.

Any losses that occurred when there was a violation of any laws or
regulations (including foreign laws or regulations) by the policy holder or the
insured in relation to the Overseas Untied Loan.

3.

Any losses suffered by the insured in relation to any event indicated in any
Item of Article 3 that occurred before the start date of the period of
insurance obligations provided for in Paragraph 1 of Article 9.

(Nonpayment of insurance claims, return of paid insurance claims)
Article 7.
NEXI may decide not to pay all or a part of the relevant insurance claims, or may
have the insured return all or a part of any insurance claims paid, in the following
cases:
1.

Where any losses suffered were caused by the negligence (excluding grossnegligence) on the part of the Insured, et al.

2.

Where the Insured, et al. has willfully or negligently failed to disclose any
fact or made a false statement.

3.

Where either the policy holder or the insured has violated any of the terms
and conditions of these Policy Conditions.

4.

Where the Insured, et al. has been deemed to be an organized crime group,-7-

member of an organized crime group (including cases where it has been lessthan five years since such a person cut ties with an organized crime group),
associate member of an organized crime group, associated entity of anorganized crime group, or other antisocial forces, or where antisocial forces
or persons having a close relationship with antisocial forces (hereinafterreferred to as the “Antisocial Forces, etc.”) have been deemed to haveeffective control over or involvement in the Insured, et al., where the Insured,et al. has been deemed to have provided funds or facilities to the Antisocial
Forces, etc., or where the Insured, et al. has been deemed to have sociallycondemnable relationships with the Antisocial Forces, etc.
(Termination of insurance contract)
Article 8.
1.

In addition to the matters prescribed in Paragraph 1 of Article 19, Paragraph
2, 3 or 9 of Article 20 and Paragraph 4 of Article 22, NEXI may terminate therelevant insurance contract in the following cases:(1)

When either the policy holder or the insured has violated the provisions
about bribery under the Unfair Competition Prevention Law (Law No.47
of 1993) in relation to the Overseas Untied Loan.

(2)

Where, following the policy holder’s or the insured's submission of thescreening

form

which

is provided for in the“Guidelines on

Environmental and Social Considerations in Trade Insurance,” andbased on the said Guidelines, the relevant project should have beenclassified as a Category A or B Project but instead was actuallyclassified as a Category C Project because the Insured et al. had made a-8-

false statement in all or part of the descriptions in the screening form
or omitted any of the descriptions either by willful act or omission or
the negligence of the Insured, et al.
(3)

When either the policy holder or the insured has violated any of theterms and conditions of these Policy Conditions.

(4)

Where the Antisocial Forces, etc. have been deemed to have effective
control over or involvement in the Insured, et al., where the Insured, etal. has been deemed to have provided funds or facilities to the
Antisocial Forces, etc. or where the Insured, et al. has been deemed tohave socially condemnable relationships with the Antisocial Forces, etc.

2.

In applying Item 2 of the preceding Paragraph, if there is (are) (an) other
lender(s) who co-finance(s) with the insured under the Overseas Untied Loan
and any such lender has entered into other insurance contract(s) under these
Policy Conditions, any intentional or negligent act of the Insured, et al. in
relation to the other insurance contract(s) shall be deemed to also be theintentional or negligent act of the insured.

3.

Unless otherwise provided herein, termination under each Item of
Paragraph 1 and any other termination of the insurance contract shall beeffective as at and after the date or time of termination only.

4.

The policy holder may terminate the insurance contract where the policy
holder becomes aware of the occurrence of any event indicated in any Item of
Article 3 (excluding events the policy holder was aware of at the time of theconclusion of the insurance contract) before the start date of the period of
insurance obligations stipulated in Paragraph 1 of the following Article, but-9-only if the policy holder has notified NEXI of that fact in writing without
delay.

In this case the insurance contract shall be deemed to be

retroactively invalid as from the date of the conclusion of the insurance
contract.
(Period of insurance obligations)
Article 9.
1.

The insurance obligations of NEXI shall commence on the date on which therelevant Overseas Untied Loan Claims, etc. were acquired, or the date on
which the relevant insurance contract was concluded, whichever occurs
later.

2.

The insurance obligations of NEXI shall end on the due date for repaymentof the Overseas Untied Loan Claims, etc.

Chapter 4.

Obligations of the Policy Holder or the Insured(Obligation to notify NEXI of other insurance contracts)
Article 10.
If either the policy holder or the insured becomes aware of the existence of any otherinsurance contracts which provide indemnity for similar risks as those covered bythese Policy Conditions in respect of the Overseas Untied Loan, either the policy
holder or the insured, as the case may be, shall notify NEXI of such other insurance
contracts in writing within one month after the date on which such knowledge wasgained and before any request for payment of insurance claims.

-10-

(Obligation to follow instructions)
Article 11.
NEXI may give instructions to the insured on matters concerning Overseas Untied
Loan Claims, etc. and the insured shall follow those instructions.
(Obligation to notify NEXI of the amount to be repaid and due date for repayment,
etc.)
Article 12.
1.

The policy holder or the insured shall, when the amount of repayment anddue date for repayment of all or a part of the Loan, etc. are ascertained,
notify NEXI of that effect in writing no later than the date as stipulated in
the Overseas Untied Loan Insurance Procedural Rules (April 1, 2017,
17-Scheme-00044, hereinafter referred to as the “Procedural Rules”).

2.

In addition to the matters prescribed in the preceding Paragraph, either thepolicy holder or the insured shall notify NEXI in writing of the amount of
the Overseas Untied Loan Claims, etc. or other matters which are necessary
for calculating the insurance premium in accordance withUntiedLoan

Insurance

Operating

Regulations

the Overseas(April1,

2017,17-Scheme-00054).
(Obligation of Protection of Loan Claims)
Article 13
The insured shall endeavor to manage and protect the Overseas Untied Loan
Claims, etc. with as much care as for its other claims.

-11-

(Obligation to notify NEXI of events which would increase the possibility of a loss
being incurred)
Article 14.
If the insured becomes aware of any event which would increase the possibility of
any loss as stipulated in the Procedural Rules before the due date for repayment,
the insured shall notify NEXI of that effect in writing, within 15 days after the dateon which such knowledge was gained.
(Obligation to notify NEXI of the occurrence of losses)
Article 15.
1.

If the insured becomes aware of the occurrence of any losses, the insured
shall notify NEXI of that effect in writing, within one month after the dateon which such knowledge was gained (hereinafter referred to as the “Noticeof Occurrence of Losses”).

2.

If the obligations with respect to the Overseas Untied Loan have not been
performed by the due date for repayment, and if any losses are likely to be
incurred for the reason stipulated in Item 11 of Article 3, the insured shallnotify NEXI of that effect in writing within one month after the due date forrepayment (hereinafter referred to as the “Notice of Occurrence of Risks”).

3.

In the case provided for in the preceding Paragraph, if no payment notice
stipulated in Article 17 has been given within three months after the due
date for repayment, the Notice of Occurrence of Risks shall be regarded as
the Notice of Occurrence of Losses.

If a notice of any partial payment of theLoan, etc. has been given, the notice of the relevant payments, combined-12-with the Notice of Occurrence of Risks, shall be regarded as the Notice of
Occurrence of Losses.
(Obligation to prevent or mitigate possible losses)
Article 16.
1.

The insured shall take all reasonable measures to prevent or mitigate any
possible losses with as much care as for its other claims.

2.

If the insured is entitled to recover damages for all or a part of any losses
incurred or entitled to claim on any guarantee obligations, the insured shalltake all procedures necessary for the exercise or preservation of the claims
for damages or to exercise the claim on such guarantee obligations.

3.

NEXI shall indemnify the insured for any expenses incurred by him/her inperforming his/her obligations prescribed in the preceding two Paragraphs;
provided, however, that the amount to be indemnified shall not exceed theamount obtained by the insured as a result of the performance of his/her
obligations; provided, further, that NEXI may indemnify the insured for an
amount which exceeds the said amount, should NEXI consider it necessary.

(Obligation to notify NEXI of monies collected)
Article 17.
If the insured, after giving the Notice of Occurrence of Losses or the Notice of
Occurrence of Risks pursuant to the provisions of Article 15, collects any claims
before making insurance claim, the insured shall notify NEXI of that effect inwriting within one month after the date on which such claims were collected and-13-before the insured makes insurance claims.
(Obligation to allow inspections)
Article 18.
1.

The policy holder or the insured shall follow any request of NEXI toinvestigate, report, or submit materials in connection with the Overseas
Untied Loan or the Loan, etc., and allow NEXI to inspect the books, vouchers,
etc. of relevance to the Overseas Untied Loan.

2.

If NEXI finds it necessary to request any inspection,

reports or submissionof materials to the counterparty to the Overseas Untied Loan concerning theOverseas Untied Loan or the Loan, etc., the insured shall cooperate withNEXI to ensure the smooth progress of any such inspection, report or
submission of materials.
3.

The insured shall follow any request of NEXI to investigate, report, or
submit materials in connection with the business or assets of the insured,and allow NEXI to inspect any books, vouchers and other items pertaining tosuch business or assets, in order to preserve any claims pertaining to theamount to be paid under the provisions of Paragraph 7 of Article 31.

(Violations of disclosure obligation)
Article 19.
1.

NEXI may terminate an insurance contract if, on the date on which suchinsurance contract was concluded, the Insured, et al. has not disclosed to
NEXI any material fact which may cause losses to be incurred by the Insured,-14-

et al. or which may affect the eligibility for Overseas Untied Loan Insurance,or has made any false statement as to such a fact to NEXI, either through awillful act or omission or negligence.
2.

The termination right prescribed in the preceding Paragraph shall be
extinguished if such right is not exercised within two months after the dateon which NEXI first obtained knowledge of the occurrence of an event which
would allow such termination.

3.

In applying Paragraph 1, if there is/are any other lender(s) who co-finance(s)with the insured under the Overseas Untied Loan and any such lender hasentered into (an) other insurance contract(s) under these Policy Conditions,
any intentional or negligent act of the Insured, et al. under the otherinsurance contract(s) shall be deemed to also be the intentional or negligent
act of the insured.

4.

Even if NEXI has terminated the insurance contract in accordance with
Paragraph 1 after the insured has incurred losses, NEXI shall not be liable
for such losses; provided, however, that NEXI shall be liable for any losses
that were incurred other than due to any material fact referred to in
Paragraph 1.

(Amendment, etc. to the Overseas Untied Loan)
Article 20.
1.

If the insured has made any material amendment, etc. as defined in theProcedural Rules (hereinafter referred to as the “material amendment, etc.”)
pertaining to the Overseas Untied Loan Claims, etc. or the Loan, etc., the-15-

insured shall notify NEXI of that effect in writing within one month after
the date of such amendment and also within the period of repayment, except
where any such amendment, etc. is made in the absence of agreement by the
insured or without any involvement of the insured.
2.

NEXI may terminate the relevant insurance contract upon receipt of a noticepursuant to the provisions of the preceding Paragraph, unless NEXI has
approved the relevant material amendment in writing.

3.

NEXI may terminate the relevant insurance contract if NEXI has given
approval in the preceding Paragraph with conditions and such conditions
have not been fulfilled.

4.

Any termination in accordance with the preceding two Paragraphs orParagraph 9 below shall be effective from the date of the relevant material
amendment only, and shall not be retroactive.

5.

If the insured fails to notify NEXI pursuant to the provisions of Paragraph 1,
NEXI may deem the relevant insurance contract invalid retroactively to thedate of the relevant material amendment.

6.

The insured may request NEXI's prior approval in writing when intending to
make any material amendment, etc.

7.

If the insured decides to make the material amendment, etc. pursuant to
NEXI’s approval prescribed in the preceding Paragraph, the insured must
make that material amendment within six months of the receipt of NEXI’s
approval.

8.

The provisions of Paragraphs 2 through 4 shall not apply to any material-16-amendments which have been made pursuant to the preceding two
Paragraphs.
9.

NEXI may terminate the relevant insurance contract if NEXI has added
conditions to the approval in Paragraph 6, and has received the notification
provided for in Paragraph 1 from the insured despite the insured’s
non-fulfillment of all of the conditions.

(Other reporting obligation）
Article 21
1.

If any event which is stipulated in the Procedural Rules occurs with regard
to the Overseas Untied Loan Claims, etc. or the Loan, etc., the insured shallnotify NEXI of such event within 15 days from the date on which the insured
became aware of such event and before the expiry date of the insurance
obligation as stipulated in Paragraph 2 of Article 9.

2.

If the insured has obtained financial information or other information
relating to the counterparty to the Overseas Untied Loan, the insured shallsubmit copies of such information to NEXI.

(Oath obligation of non-participation to the bribery act)
Article 21-2
The policy holder and the insured shall covenant to NEXI that they are not involvedin any bribery act which violates the provisions of the Unfair Competition
Prevention Law, and will not be involved in such bribery act in the future.

-17-

Chapter 5.

Insurance Premium(Payment of insurance premium, etc.)
Article 22
1.

Where the obligation of the policy holder to pay an insurance premium has
arisen because the policy holder has entered into an insurance contract, hasgiven notice stipulated in Article 12, or has made any material amendment,
etc., or where the obligation of the policy holder to pay an insurance
premium has otherwise arisen, the policy holder shall pay to NEXI the fullamount of the insurance premium designated by NEXI on or before the datedesignated by NEXI, pursuant to the Provisions Concerning the Premium
Rate of Trade and Investment Insurance (April 1, 2017, 17-Scheme-00070,
hereinafter referred to as the “Premium Rate Provisions”).

2.

If the policy holder fails to pay the full amount of the insurance premium
pursuant to the provisions of the preceding Paragraph on or before the datedesignated by NEXI or the date on which the insurance premium shall be
paid pursuant to the provisions of Paragraph 6, the policy holder, upon therequest of NEXI, shall, together with the insurance premium, pay an
overdue charge calculated at the rate of 10.95% per year, from the day
immediately following the date designated by NEXI or the date on which theinsurance premium shall be paid pursuant to the provisions of Paragraph 6
to the date of payment of the insurance premium to be made by the policy
holder, except where the relevant insurance contract is terminated pursuant
to the provisions of Paragraph 4.

3.

If the policy holder is obliged to pay an overdue charge pursuant to the-18-

provisions of the preceding Paragraph and if the policy holder has paid anamount which is less than the total of the insurance premium and theoverdue charge payable, NEXI shall apply the amount paid to the insurance
premium first, and then to the overdue charge.
4.

If the policy holder fails to pay either the full amount of the insurance
premium designated by NEXI or the full amount of an overdue charge on or
before the date designated by NEXI or the date on which the insurance
premium shall be paid pursuant to the provisions of Paragraph 6, NEXI
may terminate all or a part of the relevant insurance contract.

5.

Any termination pursuant to the provisions of the preceding Paragraphshall become effective on the date on which such insurance contract was
concluded, if the relevant insurance premium or the relevant overdue
charge is payable upon conclusion of the insurance contract, or on the dateon which the relevant material amendment was made, if the relevant
insurance premium or the relevant overdue charge is payable at the time
the relevant material amendment was made.

6.

If an order

to commence bankruptcy proceedings, civil rehabilitation

proceedings, corporate reorganization proceedings or special liquidation
proceedings, orproceedings institutionally similar to any of theseproceedings under foreign laws or regulations is made with regard to thepolicy holder, notwithstanding the provisions of Paragraph 1, theinsurance premium payment provided for in Paragraph 1 from the policy
holder to NEXI shall be automatically accelerated with no need for-19-notification, etc. by NEXI, and the policy holder shall pay the full amount of
the insurance premium immediately; provided, however, that NEXI may
designate a new payment due date after the acceleration.
(Refund of insurance premium)
Article 23.
1.

If the insurance premium was paid on or after the date immediately following
the date designated by NEXI and if NEXI has terminated the relevant
insurance contract pursuant to the provisions of Paragraph 4 of Article 22, orif the insurance premium was paid on or after the date on which suchinsurance contract was so terminated, NEXI shall refund the amount of
insurance premium.

2.

If the policy holder notified the termination of the relevant insurance contract,
as prescribed in Paragraph 4 of Article 8, and if the insurance premium waspaid before such notification, NEXI shall refund the amount of the insurance
premium.

3.

If the policy holder or the insured has applied for a reduction in either the
Insurable Value or the insurance period due to an amendment to theOverseas Untied Loan, or due to some other reasonable cause, and if NEXI
has approved such application, NEXI shall refund the amount of theinsurance premium corresponding to the portion for which NEXI is no longer
obliged to indemnify, unless otherwise specified by the Premium Rate
Provisions.

4.

Except for the cases stipulated in the preceding three Paragraphs, even if the-20-

relevant insurance contract has been invalidated, has lapsed or has been
terminated, or even if NEXI is not responsible for indemnifying any losses
incurred, NEXI shall not refund any insurance premium paid; provided,
however, that all or a part of the insurance premium paid shall be refunded
where specified by the Premium Rate Provisions.

Chapter 6.

Payment of Insurance Claims(Beneficiary)
Article 24
1.

The insured may designate a beneficiary who will undertake the procedure
for claiming payment of insurance claims on behalf of the insured and who
receives insurance claims for the insured.

2.

If the insured, after concluding an insurance contract, has designated,
replaced or removed a beneficiary (hereinafter referred to as the “designation,etc.”), the insured shall notify NEXI of that effect in writing within one monthfrom the date of the designation, etc.

(or the day before the day on which aclaim for payment of the relevant insurance is filed if such a claim is madewithin one month).
3.

If the insured has designated a beneficiary, the insured may claim payment of
insurance claims only through the beneficiary indicated in this policy.

4.

If NEXI has received a claim for payment of insurance claims from thebeneficiary indicated in this policy, NEXI shall pay any insurance claims to-21-

that beneficiary.

In this case, NEXI shall be deemed to have paid those

insurance claims to the insured, and obligations of NEXI to pay any suchinsurance claims shall have been satisfied.

(Claim for payment of insurance claims)
Article 25.
1.

The insured or any person who intends to claim payment of the insurance
claims (hereinafter referred to as the “claimant”) shall, at his/her own
expense, calculate the amount of the loss incurred and submit to NEXI arequest for payment of insurance claims, together with a statement of loss,
supporting evidence and any other necessary documents.

2.

The claim prescribed in the preceding Paragraph shall be filed on or after
the date on which the Notice of Occurrence of Losses was given pursuant to
the provisions of Article 15 and within nine months after the due date forrepayment (or if the losses caused by the reason stipulated in Item 11 of
Article 3 are to be indemnified, on or after the date falling three months
after the due date for repayment and within nine months after the due date
for repayment), unless NEXI has granted a grace period for a particular
claim.

3.

If the claimant has failed to claim payment of an insurance claim within the
period prescribed in the preceding Paragraph or within the grace period
granted by NEXI, without any reasonable grounds, NEXI shall not pay any
such insurance claim.

-22-

4.

If NEXI requests a person who has claimed payment of the insurance claims
to submit documents deemed by NEXI to be necessary for determining
whether or not NEXI is responsible for an indemnity or for determining theamount of any indemnity to be paid, the person who has claimed payment of
the insurance claims shall meet such request without delay.

5.

Notwithstanding the provisions of Paragraphs 1 and 2 of Article 22, theclaimant shall not be allowed to make an insurance claim as long as the fullamount of insurance premium and overdue interest provided for in
Paragraphs 1 and 2 of the said Article before making an insurance claim.

(Extinctive prescription of right to claim insurance claims)
Article 26.
1.

The right to claim insurance claims shall cease to exist upon the lapse of two
years after the due date of the repayment (or if loss caused by the reason
stipulated in Item 11 of Article 3 are to be indemnified, on or after the datefalling three months after the due date for repayment).

2.

The provisions of Paragraph 5 of the preceding Article shall not preclude theestablishment of extinctive prescription based on the preceding Paragraph.

(Claim for payment of insurance claims before the due date for repayment)
Article 27.
1.

If it becomes certain before the due date of repayment that the insured is nolonger able to collect the Loan, etc. due to the reasons prescribed in any of-23-

the Items of Article 3 by the due date for repayment, the insured may
request that NEXI confirm the occurrence of loss.
2.

If NEXI has confirmed in writing the occurrence of such loss pursuant to theprovisions of the preceding Paragraph then, notwithstanding the provisionsof Paragraph 2 of Article 25, the claim of payment of the insurance claim
may be made within nine months after the date of such confirmation.

3.

The amount of such loss referred to in the preceding Paragraph shall be theprincipal and interest accrued until the date of the confirmation prescribedin preceding Paragraph of all the loss amount calculated in accordance withthe provisions of Article 4.

(Payment of insurance claims)
Article 28.
NEXI shall pay the insurance claims within two months after the date on which theclaim for payment was filed pursuant to the procedures stipulated in Paragraph 1 of
Article 25, unless additional time is required for investigation.
(Relation to other insurance contracts)
Article 29.
1.

If two or more insurance contracts have been concluded under these Policy
Conditions with regard to the Overseas Untied Loan, the amount of-24-

insurance claims to be paid shall be the amount to be indemnified prescribedin Article 5 in respect of the insurance contract which results in the largest
amount of insurance claims being paid by NEXI from among all the
insurance contracts.
2.

With regard to the Overseas Untied Loan, if any insurance contract exists
which indemnifies insured risks of the same kind as those indemnified underthese Policy Conditions and if the total amount to be indemnified, under all
applicable insurance contracts, exceeds the amount of loss, the amount of
insurance claims to be paid under these Policy Conditions shall be theamount of loss prescribed in Article 4 multiplied by the ratio of the amountto be indemnified prescribed in Article 5 to the total amount to beindemnified under all applicable insurance contracts, except as otherwise
approved by NEXI.

Chapter 7.

Recovery of Claims(Subrogation)
Article 30.
NEXI, having paid insurance claims, shall, pursuant to the provisions of Article 42of the Act, acquire the claims with regard to the Loan, etc. owned by the insured at
the time of payment of the insurance claims multiplied by the ratio of the insurance
claims paid to the remaining amount prescribed in Article 4.
(Payment of monies collected)-25-

Article 31.
1.

Notwithstanding the provisions of Article 30, even after claiming payment of
insurance claims, the insured shall endeavor to collect the Loan, etc.,
damages, penalties or any other monetary claims of a similar nature basedon the Overseas Untied Loan for him/herself or NEXI; provided, however,that this provision shall not apply where NEXI has acknowledged that it isdifficult for the insured to exercise its rights to collect such monetary claims
due to an order to commence a bankruptcy proceeding against thecounterparty against whom the insured should exercise such rights or forsome other unavoidable reason or where the insured has authorized NEXI to
exercise such rights based on the provisions of Paragraph 4 of this Article or
Paragraph 3 of Article 32.

2.

The insured shall report to NEXI in writing on the performance of his/her
obligations prescribed in the preceding Paragraph, except for cases where,
pursuant to the proviso contained in the preceding Paragraph, NEXI has
given the acknowledgement or the insured has given the authorization to
NEXI.

3.

If NEXI instructs the insured to take the necessary procedures for making
the subrogation by NEXI prescribed in Article 30 enforceable against thecounterparty to the Overseas Untied Loan or any other third party under
the laws of the country of residence of such other party, the insured shallfollow such instructions.

4.

If the insured has performed the obligations prescribed in the preceding
Paragraph, the insured shall authorize NEXI to exercise its rights to enforce-26-the claims relating to the relevant insured risk which are owned by the
insured.
5.

The insured, in giving the authorization prescribed in the preceding
Paragraph,shall

followthe

Trade

Insurance

CommonOperating

Regulations (April 1, 2017, 17-Scheme-00069, hereinafter referred to as the“Common Operating Regulations”), with regard to procedural matters suchas the manner of allocating any money collected as a result of the exercise ofsuch rights.
6.

NEXI shall reimburse the insured for the expenses incurred by him/her inperforming the obligations prescribed in Paragraph 1 up to an amount notexceeding the amount collected by the insured; provided, however, thatNEXI may reimburse an amount exceeding the amount collected by the
insured should NEXI consider it necessary.

7.

If any amount of monies was collected after the claim for payment of
insurance claims was filed, the insured shall notify NEXI of that effectwithin one month after the date of collection (or if the date of collection falls
on or before the date on which the relevant insurance claim was paid, thedate of payment of the relevant insurance claims), and shall pay to NEXI theamount calculated by using the following formula as designated by NEXI on
or before the date designated by NEXI:
Amount of insurance
claims paid
(Amount of moniesx
collected -A)
Amount of loss under
Article 4-B“A” stands for the expenses for the performance of the obligations prescribedin Paragraph 1 (limited to the amount approved by NEXI).

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“B” stands for the lesser of the following amounts: (i) the amount obtainedby:deducting the amount already allocated to the insured from the amountcalculated by multiplying the amount "(a)" by the ratio of the insurance
claims paid to the amount of loss under Article 4.

Amount "(a)" is obtainedby:deducting the amount of overdue interest collected on or before the date on
which the claim for payment of insurance claims was filed (excluding any
overdue interest on principal amounts collected before claiming payment of
the insurance claims) from the amount obtained by multiplying the amountof loss under Article 4 by an interest rate separately designated by NEXI
under the Common Operating Regulations
for the period from the date immediately following the due date forrepayment (or if NEXI has confirmed the occurrence of loss under theprovisions of Paragraph 1 of Article27, the date of that confirmation) to thedate of payment of the relevant insurance claims (or, if any monies werecollected on or before the date of payment of the insurance claims, the dateof such collection); (ii) the amount calculated by deducting "A" from theamount of monies collected multiplied by the ratio of the insurance claims
paid to the amount of loss under Article 4.
8.

If the insured has failed to notify NEXI of the matters prescribed in thepreceding Paragraph within the period prescribed in the preceding
Paragraph, the insured shall pay to NEXI, on or before the date designatedby NEXI, a penalty in the amount to be paid under the provisions of the-28-

preceding Paragraph (hereinafter referred to as the “collected money to bepaid”) multiplied by 10.95% per year for the period from the date
immediately following the date on which the relevant monies were collected(or if such collection was made on or before the date on which the insurance
claims were paid, the date of payment of those insurance claims) to the dateon which the insured actually gave such notice.
9.

If the insured fails to pay to NEXI the amount due under the provisions ofParagraphs 7 or 8, on or before the day immediately following the datedesignated by NEXI, the insured shall, in addition to the amount due, pay,at the request of NEXI, overdue interest calculated by multiplying theamount due by 10.95% per year for the number of days from the datedesignated by NEXI to the date of payment to NEXI.

10.

If the insured is obliged to pay penalty amounts and overdue interest under
the provisions of the preceding two Paragraphs and if the insured has paid
an amount less than the full amount of collected money to be paid, penalty
amounts and overdue interest, NEXI shall apply the amount paid first forthe collected money to be paid, then to the penalty amounts, and then to theoverdue interest.

(Exercise of rights by NEXI)
Article 32.
l.

At any time prior to the payment of insurance claims, should NEXI consider
it necessary to exercise the rights pertaining to the claims in relation to theinsured risk by itself, NEXI may request that the insured authorize NEXI to
exercise the rights pertaining to such clams.

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2.

At any time after NEXI has been subrogated under the provisions of Article
30, should NEXI consider it necessary to exercise the rights pertaining to theclaims in relation to the insured risk by itself, NEXI may request that theinsured authorize NEXI to exercise the rights pertaining to the claims
owned by the insured in relation to the insured risk.

3.

If the insured receives from NEXI a request as mentioned in the preceding
two Paragraphs, the insured shall meet such request unless there is areasonable reason not to do so.

4.

The provisions of Paragraph 5 of Article 31 shall apply, mutatis mutandis, in
relation to any authorization given pursuant to the provisions of thepreceding Paragraph, for the procedural matters such as the manner of
allocating the monies collected through the exercise of rights.

5.

NEXI, when authorized to exercise the rights concerning claims in relation
to the insured risk under the provisions of Paragraph 3 of this Article or
Paragraph 4 of Article 31, may also authorize a third party to exercise suchrights.

Chapter 8.

Miscellaneous Provisions(Conversion rate)
Article 33.
1.

In these Policy Conditions, the foreign exchange rate applied to theconversion of a foreign currency into Japanese yen, Japanese yen into a-30-foreign currency, or a foreign currency into another foreign currency shall be
determined in accordance with the following Items:(1)

In the case of the conversion of a foreign currency into Japanese yen,
the opening customer spot rate for TT Buying quoted by a bank(being a bank as defined in Paragraph 1 of Article 2 of the Banking
Act (Act No.59 of 1981); the same shall apply hereinafter), on which
NEXI has approved (the same shall apply hereinafter).

(2)

In the case of the conversion of Japanese yen into a foreign currency,
the opening customer spot rate for TT Selling quoted by a bank.

(3)

In the case of the conversion of one foreign currency into anotherforeign currency, the opening rate of conversion between the relevant
currencies quoted by a bank.

2.

If the amount of the Loan, etc. is denominated in a foreign currency, theInsurable Value, amount of loss under Article 4 and amount to beindemnified under Article 5 shall be converted into Japanese yen at theforeign exchange rate prescribed in Item 1 of the preceding Paragraphprevailing on the respective dates given in the following Items, unlessotherwise specified by NEXI (and the same shall apply to Paragraphs 3
through5 of this Article):(1)in the case of the Insurable Value, on the date on which the relevant
contract regarding the Overseas Untied Loan Claims, etc. wasconcluded (or if (a) the amount of the Loan, etc. was increased after
the conclusion of the insurance contract, or if (b) the denomination of
the Loan, etc. was changed from Japanese yen to a foreign currency,-31-

or from a foreign currency to another foreign currency, the Insurable
Value of such increased portion in (a) and the Insurable Value in (b)shall be converted on the date on which such change was made; thesame shall apply hereinafter in this Paragraph.);(2)in the case of the amount of loss under Article 4 and the amount to
be indemnified under Article 5, on the date on which the relevant
contract for the Overseas Untied Loan was concluded or the due date
for repayment, whichever has a higher yen value (this would apply tothose cases in which the foreign exchange rate for the foreign
currency in which the relevant Loan, etc. is denominated vis-à-vis
Japanese yen in Japan became lower).

3.

If the currency of the amount stipulated in each Item of Article 4 is different
from the currency of denomination of the Loan, etc. (including Japanese yen;hereinafter referred to as the “denominated currency”), the relevant amountshall be converted into the denominated currency at the foreign exchange
rate provided for in any of the Items of Paragraph 1 of this Article prevailingon the date on which such amount was ascertained; provided, however, that
if the expenses prescribed in Item 1 of Article 4 was paid by buying therelevant amount of currency with the denominated currency, the conversion
rate used to buy such currency shall be applied.

4.

In paying the money collected pursuant to the provisions of Paragraph 7 ofArticle 31, if the money collected is denominated in a currency which isdifferent from the denominated currency, such money shall be converted into
the denominated currency at the foreign exchange rate provided for in any of
the Items of Paragraph 1 of this Article prevailing on the date on which such-32-

collection was acknowledged.
5.

The expenses to be borne by NEXI prescribed in Paragraph 3 of Article 16 orParagraph 6 of Article 31 shall be converted in accordance with theprovisions of the following Items:(1)

If the expenses prescribed in Paragraph 7 of Article 31 aredenominated in a currency which is different from the denominatedcurrency, such expenses shall be converted into the denominatedcurrency at the foreign exchange rate prescribed in any of the Items of
Paragraph 1 of this Article prevailing on the date on which theamount of such expenses was ascertained; provided, however, that, if
such expenses were paid by buying the currency in which such
expenses were denominated with the denominated currency, theconversion rate used to buy such currency shall be applied; or(2)

If the expenses to be borne by NEXI are claimed by a method otherthan as provided for in Item 1 of Article 4 or Paragraph 7 of Article 31,
and if such expenses are denominated in a foreign currency, such
expenses shall be converted into Japanese yen at the foreign exchange
rate prescribed in Item 1 of Paragraph 1 of this Article prevailing on
the date on which the amount of such expenses was ascertained;
provided, however, that if the expenses were paid by buying thecurrency in which such expenses were denominated with Japaneseyen, the conversion rate used to buy such currency shall be applied.

6.

If no foreign exchange rate prescribed in any Item of Paragraph 1 of this
Article was quoted on any of the dates described in Paragraph 2 through 5 of-33-

this Article, the foreign exchange rate on the first day before such date on
which the relevant foreign exchange rate was quoted shall be applied.
7.

With respect to a foreign currency whose foreign exchange rate prescribed in
any Item of Paragraph 1 of this Article is not quoted, the conversion ratewith other currency as an intermediate currency shall be applied.

8.

Notwithstanding the provisions of Paragraph 2 through 7 of this Article, if
NEXI considers it necessary, the conversion rate designated by NEXI shallbe applied.

(Assignment of object insured or rights to claim insurance claims)
Article 34.
1.

If the insured intends to assign the object insured or any rights to claim
insurance claims with respect to any insurance contract under these Policy
Conditions, the insured and the assignee shall jointly obtain the priorapproval of NEXI.

2.

NEXI may attach conditions when giving the approval prescribed in thepreceding Paragraph.

(Assignment, etc. of loan claims after the payment of insurance claims)
Article 35.
1.

If the insured intends to assign the insured’s portion of the loan claims
related to the insured risk after the date of payment of insurance claim, theinsured and the assignee shall jointly obtain the prior approval of NEXI.

-34-

2.

NEXI may attach conditions when giving the approval prescribed in thepreceding Paragraph.

(Creation of a pledge or security by way of assignment)
Article 36.
1.

If the insured intends to create a pledge or security by way of assignment on
the object insured or any rights to claim insurance claims with respect toany insurance contract under these Policy Conditions, the insured shallobtain the prior approval of NEXI jointly.

2.

NEXI may attach conditions when giving the approval prescribed in thepreceding Paragraph.

(Trust of object insured or rights to claim insurance claims)
Article 37.
1.

If the insured intends to entrust (including self-declaration of trust) any
object insured or any rights to claim insurance claims with respect to any
insurance contract under these Policy Conditions, for the purpose of
securitizing loan claims, the insured and the prospective trustee shall jointly
obtain the prior approval of NEXI.

2.

NEXI may attach conditions when giving the approval prescribed in thepreceding Paragraph.

3.

If the insured intends to amend documents that prescribe the contents oftrust, etc. under the provisions of Paragraph 1, the insured shall obtain theprior approval of NEXI.

-35-

(Procedural matters)
Article 38.
In addition to the matters prescribed in these Policy Conditions, procedural matterspertaining to insurance contracts shall be determined separately by NEXI under theProcedural Rules.
(Governing law)
Article 39.
Matters not prescribed in these Policy Conditions shall be governed by the Act,orders issued thereunder and the other laws or regulations of Japan.

Supplementary Provisions
These Policy Conditions shall come into force as of April 1, 2017.

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