During the German occupation of Poland, both the Polish Government in Exile and the Polish Secret Interior Army, were permitted to award the decoration. It was at that moment awarded in its pre-war form.
Before the German occupation, during the 2nd Polish Republic, the idea was noted to create a version of the decoration with swords, to be awarded in times of war and battle. It was however the Polish President in Exile who on October 19th, 1942 instituted the swords version on behalf of the Polish Government in Exile. The meaning was to institute a decoration for bravery besides the Krzyz Walecznych (Cross for Valor) which could be awarded for bravery when no enemy was involved.
Both variations (with and withoud swords) could be awarded foru times to one person in the same grade. Civilians could be awarded by the Polish Government in Exile, while military could be awarded by the different commanders of the Polish forces, included the Secret Polish Interior Army in Poland itself.