Exhibit 10.2


 


To :                           (1)                                  TBS International plc


Arthur Cox Building


Earls Fort Terrace


Dublin 2


Ireland


 


(2)                                  Argyle Maritime Corp.


Caton Maritime Corp.


Dorchester Maritime Corp.


Longwoods Maritime Corp.


McHenry Maritime Corp.


Sunswyck Maritime Corp.


c/o Suite 306


Commerce Building


1 Chancery Lane


Hamilton HM12


Bermuda


 


(3)                                  TBS International Limited


Suite 306,


Commerce Building


1 Chancery Lane


Hamilton HM12


Bermuda                                                                                                                                                                                                                                                                                                 November 2010


 


Dear Sirs


 


Loan Agreement dated 29 March 2007 as
amended by a side letter dated 24 July 2007, a supplemental letter
agreement dated 26 March 2008, a supplemental agreement dated 27 March 2009,
a side letter dated 27 May 2009, a side letter dated 3 September 2009,
a side letter dated 31 December 2009, a supplemental agreement dated 7 January 2010,
a side letter dated 28 February 2010, a side letter dated 31 March 2010,
an amending and restating agreement dated 6 May 2010 and a supplemental
letter agreement dated 16 August 2010 each made between (i) Argyle Maritime Corp., Caton
Maritime Corp., Dorchester Maritime Corp., Longwoods Maritime Corp., McHenry
Maritime Corp. and Sunswyck Maritime Corp. as joint and several Borrowers, (ii) the
banks and financial institutions listed therein as Lenders, (iii) the
Royal Bank of Scotland plc as Mandated Lead Arranger and (iv) the Royal
Bank of Scotland plc as Bookrunner, Agent, Security Trustee and Swap Bank
relating to a term loan facility of US$150,000,000 (together the “Loan
Agreement”)


 


We refer to the Loan Agreement.  Words and expressions defined therein shall
have the same meaning when used herein except as expressly provided in this
letter.


 


We refer to:-


 


1                                         the letter of 24th of September 2010
of TBS International plc (i) notifying us that various companies within
the TBS Group would be suspending the payment of certain scheduled principal
instalments owing in respect of certain indebtedness of such companies as more
particularly described therein for a period of 45 days beginning on 30th September 2010
(the “Payment Suspension”) and (ii) requesting
a waiver of the Events of Default arising under the Loan Agreement resulting
from the Payment Suspension.


 

















 


2                                         our letter to you of 30 September 2010 whereby we
agreed subject to the conditions therein to waive the Events of Default
specified therein arising under the Loan Agreement resulting from the Payment
Suspension;


 


3                                         your notification to us that you wish to extend the
period of the Payment Suspension until 29 December 2010 (the “Extended Suspension Period”) which will include the suspension
of payment of:-


 


(a)                                  the repayment of principal
instalments each in the amount of $417,500 which are scheduled due under the
Loan Agreement on 1 December 2010, 9 December 2010 and 23 December 2010;
and


 


(b)                                 the repayment of principal
instalments which are scheduled due under the other credit facilities (“Other Credit Facilities”) to the New Corporate Guarantor or
subsidiaries of the New Corporate Guarantee as set out in the schedule hereto.


 


(A)                              Should you decide not to pay the principal instalments
falling due under the Loan Agreement and the Other Credit Facilities during the
Extended Suspension Period and you request the forbearance of your lenders and
swap providers (the “Creditors”) to
them exercising their rights under the respective facilities and swap
arrangements arising from the corresponding payment default under the Loan
Agreement and Other Credit Facilities, we confirm on behalf of the Lenders
their agreement not to exercise during the Extended Suspension Period any of
their rights or remedies under the Loan Agreement and other Finance Documents
arising from the Events of Default due to such payment default under Clause
19.1(a), Clause 19.1(f)(i) and Clause 19.1(f)(ii) of the Loan
Agreement and the Events of Default due to the Extended Suspension Period under
Clause 19.1(g)(ix) and Clause 19.1(f)(ii) of the Loan Agreement
subject to the following conditions:


 


1.                                       You provide satisfactory evidence that all lenders
under bilateral facilities, all syndicates under syndicated facilities and all
swap providers to the New Corporate Guarantor and/or its subsidiaries have
confirmed their forbearance in respect of the payment default and the Extended
Suspension Period.


 


2.                                       We receive from you a copy of this letter duly
acknowledged by each of the Borrowers, the New Corporate Guarantor and the
Corporate Guarantor.


 


(B)                                By signing the acknowledgement to this letter, each of
the Corporate Guarantor and the New Corporate Guarantor hereby agree to the
perform the following covenants and acknowledge and agree that failure to
perform such covenants shall result in a termination of the forbearance set
forth above and an Event of Default under the Loan Agreement:-


 


1.                                       the Borrowers shall not for each calendar week ending
during the Extended Suspension Period permit the aggregate daily closing
balance of Qualified Cash of the Security Parties to be less than $15,000,000
on the last Business Day of any week or on average in any week, of which at
least $5,000,000 (excluding any restricted cash) is deposited with the Agent at
all times (and during the Extended Suspension Period, but subject to the
forbearance against the exercise of the rights and remedies of the Lenders
arising from the Events of Default referred to in (A) not ceasing to be
effective or terminating as the case may be, such covenant under this paragraph
1 shall replace the minimum cash liquidity covenant in Schedule 8(a) of
the Loan Agreement);


 

















 


2.                                       interest on the Loan during the Extended Suspension
Period to be charged under the Loan Agreement at the default rate specified in
Clause 7.2 thereof;


 


3.                                       the New Corporate Guarantor to provide 13 week cash
flow statements showing in reasonable detail cash receipts and disbursements to
be updated and provided on a weekly basis;


 


4.                                       the New Corporate Guarantor to provide within 35 days
from the end of each calendar month (in addition to the monthly management
information to be provided under clause 11.6 (d) of the Loan Agreement)
monthly financials including income statements, balance sheets, cash flows and
key performance indicators for the business;


 


5.                                       J Alix Partners to continue as financial adviser to
the New Corporate Guarantor and Corporate Guarantor until otherwise agreed in
writing by the Lenders.  Should J Alix Partners terminate their existing
involvement with the New Corporate Guarantor and Corporate Guarantor an
alternative financial advisor, satisfactory to the Lenders, shall be
appointed within 5 business days of J Alix Partners advising termination of
their contract with the New Corporate Guarantor and Corporate Guarantor. 
The newly appointed financial advisor shall continue to assist the New
Corporate Guarantor and Corporate Guarantor until otherwise agreed in writing
by the Lenders;


 


6.                                       the Borrowers to pay a fee to the consenting Lenders
in the amount of 0.05% on the total amount of their Available Commitments and
Contribution;


 


7.                                       the Borrowers, the Corporate Guarantor and the New
Corporate Guarantor to continue negotiations in good faith for the
restructuring of the Loan Agreement and Other Credit Facilities until the
payment of principal instalments under the Loan Agreement and Other Credit
Facilities have been resumed to the satisfaction of the Lenders and the other
Creditors; and;


 


8.                                       the New Corporate Guarantor and its subsidiaries shall
not agree with the other Creditors any more favourable terms in relation to
their consent or forbearance than those agreed with the Lenders.


 


In the event that any of the conditions
referred to in (A) above are not fulfilled, or if the covenants in (B) above
are not fulfilled, the forbearance against the exercise of the rights and
remedies of the Lenders arising from the Events of Default specified in (A) shall
cease to be effective or shall terminate as the case may be and the Lenders
shall remain entitled to exercise their rights under the Finance Documents
arising from such Events of Default. 
Furthermore the Lenders reserve all their rights and remedies under the
Finance Documents in respect of any other Events of Default which may arise or
have arisen.


 


Other than as set out in this letter the
provisions of the Loan Agreement shall remain unchanged and in full force and
effect.


 


This letter shall constitute a Finance Document
for the purposes of the Loan Agreement.


 

















 


The provisions of clause 31 (Law and Jurisdiction)
of the Loan Agreement shall apply to this letter as if set out in full but so
that the references to “this agreement” are amended to read “this letter”.


 


 


Yours
faithfully


 


	
   

  	
  The
  Royal Bank of Scotland plc

  	
   

  
	
   

  	
  (as
  Agent)

  	
   

  
	
   

  	
  /s/
  Jayne Tobin

  	
   

  
	
   

  	
  Associate
  Director

  	
   

  



 


 


	
  Accepted and agreed

  	
   

  
	
  for and on behalf of

  	
   

  
	
   

  	
   

  
	
  TBS International Limited

  	
   

  
	
  (as Corporate Guarantor)

  	
   

  
	
   

  	
   

  
	
  /s/ Ferdinand V. Lepere

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  For and on behalf of

  	
   

  
	
   

  	
   

  
	
  Argyle Maritime Corp.

  	
   

  
	
  Caton Maritime Corp.

  	
   

  
	
  Dorchester Maritime Corp.

  	
   

  
	
  Longwoods Maritime Corp.

  	
   

  
	
  McHenry Maritime Corp.

  	
   

  
	
  Sunswyck Maritime Corp.

  	
   

  
	
   

  	
   

  
	
  /s/ Ferdinand V. Lepere

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  For and on behalf of

  	
   

  
	
   

  	
   

  
	
  TBS International plc

  	
   

  
	
  (as New Corporate Guarantor)

  	
   

  
	
   

  	
   

  
	
  /s/ Ferdinand V. Lepere

  	
   

  



 

















 


Schedule


 


	
  Facility

  	
   

  	
  Principal Amount

  	
   

  	
  Date

  	
   

  
	
  Royal
  Bank of Scotland plc Term Loan Facility dated as of March 29, 2007 (as
  amended from time to time thereafter)

  	
   

  	
  $

  	
  417,500

  	
   

  	
  December 1, 2010

  	
   

  
	
  $

  	
  417,500

  	
   

  	
  December 9, 2010

  	
   

  
	
  $

  	
  417,500

  	
   

  	
  December 23, 2010

  	
   

  
	
  Credit
  Suisse AG Loan Agreement dated as of December 7, 2007 (as amended)

  	
   

  	
  $

  	
  437,000

  	
   

  	
  November 19, 2010

  	
   

  
	
  $

  	
  437,000

  	
   

  	
  December 13, 2010

  	
   

  
	
  Joh.
  Berenberg, Gossler & Co. KG Loan
  Agreement dated as of June 19, 2008 (as amended)

  	
   

  	
  $

  	
  812,500

  	
   

  	
  December 22, 2010

  	
   

  
	
  Commerzbank
  AG dated as of May 28, 2008 (as amended)

  	
   

  	
  $

  	
  1,000,000

  	
   

  	
  December 2, 2010