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Provisions with respect to guarantees.
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25.—The Act of 1990 is hereby amended by the insertion of the following section after section 25:
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“25A. (1) The following provisions shall have effect in relation to the liability of any person (‘the third person’) whether under a guarantee or otherwise, in respect of a debt (‘the debt’) of a company to which an examiner has been appointed:
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(a) subject to paragraph (b) and save where the contrary is provided in an agreement entered into by the third person and the person to whom he is liable in respect of the debt (‘the creditor’), the liability shall, notwithstanding section 24(6), not be affected by the fact that the debt is the subject of a compromise or scheme of arrangement that has taken effect under section 24(9),
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(b) neither paragraph (a) nor any of the subsequent provisions of this subsection shall apply if the third person is a company to which an examiner has been appointed,
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(c) if the creditor proposes to enforce by legal proceedings or otherwise the obligation of the third person in respect of the liability, then—
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(i) he shall—
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(I) if 14 days' or more notice is given of such meeting, at least 14 days before the day on which the meeting concerned under section 23 to consider the proposals is held, or
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(II) if less than 14 days' notice is given of such meeting, not more than 48 hours after he has received notice of such meeting,
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serve a notice on the third person containing an offer in writing by the creditor to transfer to the third person (which the creditor is hereby empowered to do) any rights, so far as they relate to the debt, he may have under section 23 to vote in respect of proposals for a compromise or scheme of arrangement in relation to the company.
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(ii) if the said offer is accepted by the third person, that offer shall, if the third person furnishes to the examiner at the meeting concerned a copy of the offer and informs the examiner of his having accepted it, operate, without the necessity for any assignment or the execution of any other instrument, to entitle the third person to exercise the said rights, but neither the said transfer nor any vote cast by the third person on foot of the transfer shall operate to prejudice the right of the creditor to object to the proposals under section 25,
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(iii) if the creditor fails to make the said offer in accordance with subparagraph (ii), then, subject to subparagraph (iv), the creditor may not enforce by legal proceedings or otherwise the obligation of the third person in respect of the liability,
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(iv) subparagraph (iii) shall not apply if a compromise or scheme of arrangement in relation to the company is not entered into or does not take effect under section 24(9) and the creditor has obtained the leave of the court to enforce the obligation of the third person in respect of the liability,
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(d) if the third person makes a payment to the creditor in respect of the liability after the period of protection has expired, then any amount that would, but for that payment, be payable to the creditor in respect of the debt under a compromise or scheme of arrangement that has taken effect under section 24(9) in relation to the company shall become and be payable to the third person upon and subject to the same terms and conditions as the compromise or scheme of arrangement provided that it was to be payable to the creditor.
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(2) Nothing in subsection (1) shall affect the operation of—
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(a) section 5(2) (f), or
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(b) any rule of law where by any act done by the creditor referred to in that subsection results in the third person referred to therein being released from his obligation in respect of the liability concerned.”.
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