I've committed the attached patch.

2017-05-15  Steven G. Kargl  <ka...@gcc.gnu.org>

        PR fortran/80752
        * expr.c (gfc_generate_initializer):  If type conversion fails,
        check for error and return NULL.

2017-05-15  Steven G. Kargl  <ka...@gcc.gnu.org>

        PR fortran/80752
        gfortran.dg/pr80752.f90: New test.

-- 
Steve
20170425 https://www.youtube.com/watch?v=VWUpyCsUKR4
20161221 https://www.youtube.com/watch?v=IbCHE-hONow
Index: gcc/fortran/expr.c
===================================================================
--- gcc/fortran/expr.c	(revision 248066)
+++ gcc/fortran/expr.c	(working copy)
@@ -4395,7 +4395,12 @@ gfc_generate_initializer (gfc_typespec *
 	  if ((comp->ts.type != tmp->ts.type
 	       || comp->ts.kind != tmp->ts.kind)
 	      && !comp->attr.pointer && !comp->attr.proc_pointer)
-	    gfc_convert_type_warn (ctor->expr, &comp->ts, 2, false);
+	    {
+	      bool val;
+	      val = gfc_convert_type_warn (ctor->expr, &comp->ts, 1, false);
+	      if (val == false)
+		return NULL;
+	    }
 	}
 
       if (comp->attr.allocatable
Index: gcc/testsuite/gfortran.dg/pr80752.f90
===================================================================
--- gcc/testsuite/gfortran.dg/pr80752.f90	(nonexistent)
+++ gcc/testsuite/gfortran.dg/pr80752.f90	(working copy)
@@ -0,0 +1,20 @@
+! { dg-do compile }
+! PR fortran/80752
+module exchange_utils
+
+  implicit none
+
+  integer, parameter, public :: knd = 8
+
+  type, private :: a
+     logical :: add_vs98 = 0.0_knd ! { dg-error "Can't convert" }
+  end type a
+
+  type, private :: x_param_t
+     type(a) :: m05_m06
+  end type x_param_t
+
+  type(x_param_t), public, save :: x_param
+
+end module exchange_utils
+

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