Bond Support Credit Insurance Policy

Schedule
Insured: Insureds Address: Insurer: Obligor: Beneficiary: Guarantees: Insured Contract: [name of employer/beneficiary of the guarantees] [name specific guarantees we are covering] [give details of counter indemnity in place between the Insured and the Obligor and any subsequent amendments]

Policy Period: Policy Limit: Insured Percentage: Deductible: Waiting Period: Policy Currency: Premium: Insurance Premium Tax: Broker: Brokerage: [value] of Net Loss to be retained by the Insured. [180 days] from receipt of claim [value] of Net Loss in excess of the Deductible.

By acceptance of this Policy, the Insured represents to the Insurer that the statements contained in the Proposal Form made a part hereof and the Schedule and any attachments thereto are the Insured's agreements and representations and that this Policy is the entire agreement between the Insured and the Insurer or any of its agents relating to this insurance. At issuance, this Policy excludes endorsement(s).

Broker:

Address:

________________________ DATE

Bond Support Credit Insurance Policy

Policy No. [ ]

In consideration of the premium paid and in reliance upon statements made to the Insurer by the Insured and subject to the Schedule and Endorsements made a part hereof and the terms, conditions and limitations set forth herein, the Insurer hereby agrees as follows:

Insuring Agreement
Whereas the Insured has entered into the Insured Contract with the Obligor and the Insured has issued Guarantees on behalf of the Obligor for the benefit of the Beneficiaries. Whereas the Insured requires this insurance in order to protect against the Insured Event. The Insurer, subject to all of the terms and conditions of this Policy, will pay the Insured the Insured Percentage of their Net Loss caused solely and directly by an Insured Event occurring during the Policy Period. The amount payable by the Insurer under this Policy will be subject always to the Policy Limit.

Definitions
Capitalised terms shall have the meaning assigned to them in the Schedule or as defined hereunder: Insured Debt: means a legitimate and enforceable debt that is contractually owing to the Insured by the Obligor in respect of the Guarantees and in accordance with the Insured Contract, excluding taxes or any other additional charges. Insured Event: means the Obligors failure to pay the Insureds lawful demand for the Insured Debt under the Insured Contract where such failure is due to an Insolvency of the Obligor. Insolvency: means that any of the following steps has been taken by or against the Obligor or the Insured (hereafter referred to as the entity) or any of the following events has occurred in respect of an entity pursuant to the law of the country having jurisdiction over that entitys affairs 1. a bankruptcy, winding-up or administrative order is made against the entity; or 2. in the course of execution of a judgement the levy of execution fails to satisfy the debt in full; or 3. a valid assignment, composition or other arrangement is made for the benefit of the entitys creditors generally; or 4. an effective resolution is passed for the winding-up of the entity; or 5. an administrative or other receiver or manager of any of the entitys property is appointed. Net Loss: the amount of the Insured Debt that remains unpaid at the occurrence of the Insured Event less any amount the Insured has received from any source whatsoever in or towards payment of the Insured Debt.

1. Conditions Of Cover
1.1 This Policy is always subject to the following conditions: 1. the Beneficiary has made a demand on the Insured for payment under the Guarantees; and 2. the Insured has paid the Beneficiary in full in respect of such demand; and 3. the Insured has made a demand on the Obligor for payment under the Insured Contract; and 4. an Insured Event has occurred during the Policy Period.

2. Excluded Cover
2.1 This Policy does not cover any Net Loss arising from: 1. any fines, local duties, taxes or penalties imposed upon the Insured; or 2. currency fluctuations; or 3. disputes existing in relation to the Insured Debt, including but not limited to documentary disputes; or 4. directly or indirectly from war (whether before or after the outbreak of hostilities) between any of the following countries: China, France, the United Kingdom, the Russian Federation and the United States of America; or 5. directly or indirectly caused by, contributed to by or arising from the ionising, radioactive, toxic, explosive or other hazardous or contaminating properties or effects of any explosive nuclear assembly or component thereto, nuclear fuel, combustion or waste; or 6. gross negligence, fraudulent, dishonest or criminal acts of the Insured; or 7. Insolvency of any party whatsoever except the Obligor.

3. Warranties
3.1 It is warranted that: 1. the Insured Contract is in full force and effect and the Insured will maintain a legally enforceable indebtedness of the Obligor pursuant to the Insured Contract; and 2. the Insured will not agree to any material alteration or amendment to the terms and conditions of the Insured Contract without the Insurers prior written approval; and 3. the Insured will not agree to any rescheduling or acceleration of payment under the Insured Contract without the Insurers prior written approval; and 4. the Insured has obtained, and will obtain or extend, renew or modify, all authorisations and licenses necessary for the Insured Contract; and 5. the Insured must have complied with and continue to comply in all material respects with all relevant laws; and that the Obligor have, to the best knowledge of the Insured, complied with and will continue to comply in all material respects with all relevant laws; and 6. the Insured shall not disclose the existence of this Policy, at any time, either before or after an Insured Event occurs and whether before or after the expiry of this Policy, to any third party other than (a) to its own professional, financial and legal advisors (all on a confidential basis) without the prior written consent of the Insurer (b) to its or its groups auditors or (c) any other person where required to do so by any competent court, judicial, governmental, supervisory or listing authority.

4. Proof of Net Loss and Settlement of a Claim

4.1 It is a condition precedent to any liability under this Policy that the Insured must submit any claim under this Policy within 6 months of becoming aware of the occurrence of an Insured Event. The Insurer will pay to the Insured the Insured Percentage of the Net Loss as soon as practicable after expiry of the Waiting Period, but in any event not later than 10 business days after that expiry, provided that the Insured has tendered a sworn proof of Net Loss acceptable to the Insurer and the Net Loss has been ascertained and assessed to the satisfaction of the Insurer in its sole discretion, acting reasonably, following receipt of the claim and an appropriate form of discharge of liability together with reasonable evidence of Insolvency and reasonable evidence of the Insured Debt. The proof of Net Loss shall include but not be limited to evidence that the Net Loss was caused by an act or occurrence insured under this Policy and that all conditions and warranties have been complied with. The responsibility for proving a Net Loss under this Policy and evidencing that all conditions, conditions precedent, warranties and obligations have been complied with shall at all times rest with the Insured.

4.2

4.3

4.4

5. General Conditions
5.1 Payment of Premiums It shall be a condition precedent to any liability under this Policy that all Premiums and other charges under this Policy shall be paid. 5.2 Due Diligence It shall be the duty of the Insured to use due diligence at all times and to do and concur in doing all things reasonable and practicable to avoid any loss and/or diminish the effects of the occurrence of an Insured Event. 5.3 Loss Payee The Insured can, with the prior agreement of the Insurer, require any claims payments hereunder to be made to a named loss payee, all the Insured's obligations under this Policy remaining unaffected. 5.4 Cancellation (a) The Insured is not permitted to cancel this Policy. The Insurer is permitted to cancel this Policy for non-payment of premium or through the Insolvency of the Insured. The Policy may be cancelled by the Insurer in accordance with (a) above, by mailing written notice stating when, not less than 10 days thereafter, the cancellation shall be effective. Upon cancellation by the Insurer the Policy shall be deemed void and no Net Loss eligible for payment. The mailing of such notice shall be sufficient proof of notice.

(b)

5.5

Assignment The Insured shall not assign this Policy to any other party or person without the prior agreement of the Insurer.

5.6

Ceasing New Commitments It shall be a condition to the Insurers liability under this Policy that, unless the Insured as obtained the Insurers prior consent to do otherwise, the Insured shall cease all new commitments to or on behalf of the Obligor where any payment due from the Obligor to

the Insured becomes overdue for payment. This condition applies whether such payments are insured under this Policy or any other policies or are uninsured. 5.7 Misrepresentation and Fraud Any misrepresentation, whether fraudulent or otherwise, or fraudulent conduct on the Insureds part in relation to the Policy, to any claim under it, or to any contract to which the Policy applies, will render the Policy void but the Insurer may retain any premium or other charges paid and the Insured will be liable to refund to the Insurer any payment the Insurer have made under the Policy. 5.8 Request for Information The Insured must provide all information and documents, which it is legally and contractually able to provide, that the Insurer requests. The information the Insurer requests must be relevant to the Policy and it must be reasonable to make the request. 5.9 Duty of Disclosure The Insured must disclose and continue to disclose promptly throughout the Policy Period all facts which might affect the risk insured. 5.10 Headings Headings in this Policy are included for the convenience of reference only and shall not constitute a part of the Policy. All singular descriptions shall be treated as plural where appropriate. 5.11 Arbitration Any dispute arising under, out of or in connection with this policy, including without limitation disputes as to its formation and validity, and whether arising during or after the Policy Period, shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by one or more arbitrators in accordance with said Rules. The place of arbitration shall be London. The language of the arbitration shall be English. 5.12 Law The Policy shall be governed by and construed in accordance with English Law and subject to jurisdiction of the English Courts.

5.13

Duty to Notify 5.13.1 The Insured, in order to prevent or minimise any loss recoverable under this Policy, undertakes that it will: 1. give prompt notice to the Insurer in writing upon it becoming aware of the occurrence of an Insured Event or the discovery of any event or circumstances likely to give rise to a claim under this Policy; in the event that any amount owed by the Obligor to the Insured (whether said amount relates to an Insured Debt or not) becomes overdue by 30 days from the original due date, give prompt notice to the Insurer in writing; use due care and diligence and take all practicable measures to prevent and minimise loss, including ensuring that all rights against the contract are properly preserved and exercised; take all steps that the Insurer deems necessary, acting reasonably, including the institution of legal proceedings.

2.

3.

4.

5.13.2

The Insurer will contribute towards costs and expenses (excluding administrative costs) that the Insured properly and reasonably incur in fulfilling their obligations to minimise and recover a loss. The Insurers contribution will be proportionate to the Insured Percentage on the loss if this had been a Net Loss.

5.14

Recoveries 5.14.1 Recoveries consist of but are not limited to any sums received by or on behalf of the Insured from the Obligor or from any other source whatsoever after the occurrence of an Insured Event as or towards payment of the Insured Debt including dividends, securities, indemnities, guarantees, rights of action, counterclaims or set off. Any sums received by or on behalf of the Insured in respect of the Insured Debt shall be treated as recoveries hereunder regardless of any designation as to application of funds or the source from which payments are received and shall be applied chronologically against the outstanding Insured Debt in order of due dates or extended due dates where appropriate.

5.14.2

5.14.3

All subsequent recoveries made by or on behalf of the Insured in respect of the Insured Debt shall be applied to reduce the Net Loss, as calculated in accordance with the terms of this Policy, to provide a new Net Loss (the Revised Net Loss); the recoveries shall then be distributed to the Insured and to the Insurer in such manner as to ensure that the Revised Net Loss is borne by the Insured and the Insurer in the same proportions as would the original Net Loss. It is acknowledged by the Insured that it shall hold such applicable sums recovered in trust for the Insurer and that it shall pay all applicable sums so received to the Insurer as soon as practicable after receipt by it and/or after knowledge of its receipt by any person on its behalf. Upon the occurrence of an Insured Event the Insured shall continue to take all reasonable steps necessary to effect recoveries.

5.14.4

5.14.5

5.15

Subrogation 5.15.1 The Insured shall do and concur in doing and permit to be done all such acts and things as may be necessary or reasonably required by the Insurer for the purpose of enforcing any rights and remedies, or of obtaining relief or indemnity from other parties to which the Insurer shall be or would become entitled or subrogated upon their paying any Net Loss under this Policy whether such acts and things shall be or become necessary or required before or after payment is made hereunder by the Insurer to the Insured. In the event of any payment under this Policy , the Insurer shall be subrogated to all of the Insureds rights of recovery therefore against any person and organisation, and the Insured shall execute and deliver all instruments and papers and do whatever else is reasonably necessary to secure such rights. As a condition precedent to any claims payment under this policy, the Insured Contract or other sources of recovery to which the Insurer shall be subrogated shall not be subject to any lien, security interest or other third party claim superior to that of the Insurer.

5.15.2

5.15.3

5.16

Action Against the Insurer No action arising out of this Policy may be brought against the Insurer unless such action is commenced within twenty four (24) months following the Insured Event.

5.17

Application of Funds For the purpose of determining the Insurers liability under this Policy, all funds received by the Insured under the Insured Contract after the Obligor is in default for any obligation shall first be applied to the amount covered by this Policy.

5.18

Compliance by the Insured Failure by the Insured to comply with any term or condition of this Policy shall not be deemed to have been excused or accepted by the Insurer unless the same is specifically so excused or accepted by the Insurer in writing.

5.19

Insureds Records Upon reasonable notice to the Insured, the Insurer may at any time examine or copy any letter, account or other documentation in the possession or control of the Insured relating to or connected with this Policy. The Insured shall, at the request of the Insurer, take all reasonable steps to obtain for the Insurer any information or any document in the possession of any third party relating to or connected with this Policy.

5.20

Notices All notices of loss, claims, application, demands and requests provided for in this Policy shall be in writing.

5.21

Other Insurance The insurance provided under this Policy shall be excess over any other valid bond, insurance or other indemnity.

5.22

Third Parties Pursuant to Section 1(a) and Section 1(2) of the Contracts (Rights Against Third Parties) Act 1999, nothing in this Policy is intended to confer a directly enforceable benefit on any party other than the Insured.