The hazard rate $\lambda$ is constant at 0.09. The probability of survival to time $t$ is $S(t) = e^{-\lambda t}$. Due to the memoryless property of the exponential distribution (which applies for a constant hazard rate), the probability of defaulting within the next year, given that the company survived the first year, is exactly the same as defaulting within the first year: $P(t < 2 | t \ge 1) = 1 - e^{-\lambda \times 1} = 1 - e^{-0.09} = 1 - 0.91393 = 0.08607$, or $8.61%$.