Document:

Exhibit 10.1

 

EXECUTION VERSION

 

FIRST AMENDMENT TO FORBEARANCE AGREEMENT

 

dated as of November 15, 2010

 

TBS
International Limited

Commerce
Building, One Chancery Lane

Hamilton
HM 12 Bermuda

 

Re:          First Amendment to Forbearance
Agreement (this “Amendment”)

 

Ladies
and Gentleman:

 

Reference
is hereby made to (i) those certain extensions of credit (the “Loans”)
made pursuant to and as evidenced by, inter  alia, (a) that
certain Amended and Restated Credit Agreement, dated as of March 26, 2008
(as amended, restated, supplemented or otherwise modified and in effect from
time to time, the “Credit Agreement”), among Albemarle Maritime Corp.
and each of the other entities identified on the signature pages thereof
as Borrowers (the “Borrowers”), TBS International plc and TBS
International Limited, as guarantors (collectively, “Holdings”), TBS
Shipping Services Inc., as Administrative Borrower (the “Administrative
Borrower”), each of the financial institutions party thereto as lenders
(the “Lenders”), Bank of America, N.A., as Administrative Agent (the “Administrative
Agent”), Citibank, N.A. and DVB Group Merchant Bank (Asia) Ltd., as
co-Syndication Agents, TD Banknorth, N.A., as Documentation Agent and Banc of
America Securities LLC, as Sole Lead Arranger and Sole Book Manager; and (b) the
other Loan Documents (as defined in the Credit Agreement) and (ii) that
certain Forbearance Agreement, dated as of September 30, 2010 (as hereby
amended, the “Forbearance Agreement”) by and among Borrowers, Holdings,
Administrative Borrower, the Administrative Agent and the other Lenders
signatory thereto.  All capitalized terms
used herein without definition that are defined in the Credit Agreement or the
Forbearance Agreement shall have the same meanings herein as therein, as applicable.

 

Each
Loan Party acknowledges that the Specified Defaults have occurred and are
continuing.  The Loan Parties agree that,
but for the terms of the Forbearance Agreement, the Administrative Agent may,
if Required Lenders consent, and shall, at the direction of Required Lenders,
proceed to enforce its rights and remedies under the Credit Agreement to
collect the Borrowers’ indebtedness to the Administrative Agent and the Lenders
under the Credit Agreement.  Each Loan
Party acknowledges that the Forbearance pursuant to the Forbearance Agreement
will expire on November 15, 2010 (unless the Forbearance Termination Date
occurs prior to such date).  The
Administrative Agent, the Required Lenders and the Loan Parties hereby agree to
amend certain provisions of and extend the period of Forbearance under the
Forbearance Agreement upon the following terms and conditions:

 

§1.  Amendment
to Forbearance Agreement.   Subject to the
satisfaction of the conditions to effectiveness set forth in Section 6
of this Amendment, the Forbearance Agreement is hereby amended as follows:

 

(a)           Forbearance Termination Date.  Section 4
of the Forbearance Agreement is hereby amended by deleting the date “November 15,
2010” in clause (i) of the first sentence thereof and substituting the
date “December 29, 2010” in lieu thereof.

 

 

(b)           Specified
Defaults.  The definition of “Specified
Defaults” contained in the recitals to the Forbearance Agreement is hereby
amended to include any Default or Event of Default which occurs under the Section 7.13(b) of
the Credit Agreement (Minimum Cash Liquidity) so long as Holdings and the
Borrowers comply with the minimum cash liquidity covenant set forth in Section 5(a) of
this Amendment.

 

§2.  Ratification
of Existing Agreements.   The Loan Parties confirm
and agree that the Obligations, as evidenced by or otherwise arising under the
Credit Agreement and the other Loan Documents, are, by the Loan Parties’
execution of this Amendment, ratified and confirmed in all respects.  The Loan Parties confirm and agree that to
the extent that any Loan Document purports to assign or pledge to the
Administrative Agent, for the benefit of the Lenders, or to grant to the
Administrative Agent, for the benefit of the Lenders, a security interest in or
lien on, any assets of the Loan Parties as security for any of the Obligations
from time to time existing in respect of the Loan Documents, such pledge,
assignment and/or grant of a security interest or lien is hereby ratified and
confirmed in all respects as security for all of the Obligations, whether now
existing or hereafter arising. In addition, by the execution of this Amendment,
each of the Loan Parties represents and warrants that no counterclaim, right of
set-off or defense of any kind exists or is outstanding as of the First
Amendment Effective Date (as defined below) with respect to such Obligations.

 

§3.  Representations and Warranties.  All
of the representations and warranties made by each of the Loan Parties in the
Credit Agreement and the other Loan Documents are true and correct on the date
hereof as if made on and as of the date hereof, except with respect to the
occurrence of the Specified Defaults and to the extent that any of such
representations and warranties relate by their terms to a prior date they shall
be true and correct as of such prior date.

 

§4.  Acknowledgements.  Each of the
Loan Parties hereby acknowledges that it shall work diligently and use
commercially reasonable efforts to complete each of the following items:

 

(c)           Vessel
Appraisals.  On or about November 26,
2010, delivery to the Lenders of a vessel evaluation and appraisal report in
scope, form and substance satisfactory to the Administrative Agent to be
provided at the sole expense of the Borrowers from a marine appraisal firm
acceptable to the Administrative Agent.

 

(d)           Letter of
Intent.  On or about November 29, 2010, delivery to the
Administrative Agent of a letter of intent from the major stockholders of TBS
International plc with respect to an equity investment in the Loan Parties in an
amount, on terms and subject to conditions acceptable to the Administrative
Agent.

 

(e)           Restructuring
Term Sheet.  On or about November 29,
2010, agreement by the Loan Parties and the Lenders to a term sheet with
respect to a longer term restructuring of the credit facilities provided under
the Credit Agreement, subject to documentation, receipt of internal approvals
and such other conditions as the parties thereto may agree, such restructuring
to close on or about December 22, 2010.

 

§5.  Covenants.  Each of the
Administrative Agent, the Required Lenders and the Loan Parties hereby covenant
and agree with and for the benefit of the Administrative Agent and the Lenders,
notwithstanding anything to the contrary contained in the Credit Agreement or
any of the other Loan Documents, as follows:

 

(a)           Minimum
Cash Liquidity.  Notwithstanding
anything to the contrary contained in Section 7.13(b) of the Credit
Agreement, for each calendar week ending after the First Amendment Effective
Date 

 

2

 

(as
defined below) through and including any calendar week ending on or before the
Forbearance Termination Date, Holdings
and the Borrowers shall not permit the aggregate daily closing balance of
Qualified Cash of the Loan Parties (other than the Limited Guarantors) to be
less than $15,000,000 on the last Business Day of any week or on average in any
week, of which a minimum average balance of $5,625,000 must be deposited with
Bank of America, N.A.

 

(b)           Borrowers’
Restructuring Advisor.  AlixPartners,
LLP shall continue as Borrowers’ Restructuring Advisor to the Loan Parties
until otherwise agreed in writing by the Administrative Agent.  In the event that AlixPartners, LLP
terminates their existing involvement with the Borrowers, the Borrowers shall
appoint one of the other restructuring advisors set forth on Schedule B to the
Forbearance Agreement, or such other restructuring advisor satisfactory to the
Administrative Agent, within 5 Business Days of AlixPartners, LLP providing the
Borrowers written notice of termination of their contract with the
Borrowers.  The Borrowers shall cause the
newly appointed restructuring advisor to continue to serve as Borrowers’
Restructuring Advisor until otherwise agreed in writing by the Administrative
Agent.  The Borrowers agree that any
final reports of the Borrowers’ Restructuring Advisor provided to the Borrowers
will also be provided to the Lenders within a reasonable period of time
following the Borrowers’ receipt of such final report.

 

(c)           Compliance
with Forbearance Agreement and other Loan Documents. Each Loan Party will,
and will cause each of its Subsidiaries to, comply and continue to comply with
all of the terms, covenants and provisions contained in the Forbearance
Agreement and each other Loan Document to which it is a party and any other
instruments evidencing or creating any of the Obligations except as such terms,
covenants and provisions are expressly modified by the Forbearance Agreement or
this Section 4.

 

(d)           Further
Assurances. Each Loan Party will, and will cause its Subsidiaries to, at
any time or from time to time execute and deliver such further instruments,
each in form and substance satisfactory to the Administrative Agent, and take
such further action as the Administrative Agent may reasonably request, in each
case further to effect the purposes of this Amendment, the Forbearance
Agreement, the Loan Documents and all documents, agreements and instruments
executed in connection therewith.

 

§6.  Conditions to Effectiveness.  The Administrative Agent, the Required
Lenders and the Loan Parties agree that the extension of the forbearance
obligations of the Administrative Agent and the Lenders under the Forbearance
Agreement shall be effective upon the satisfaction of each of the following
conditions precedent, each in form and substance satisfactory to the
Administrative Agent, no later than November 15, 2010 (the “First
Amendment Effective Date”):

 

(a)           The Loan Parties,
the Required Lenders and the Administrative Agent shall have executed and
delivered to the Administrative Agent this Amendment.

 

(b)           The applicable
Subsidiaries of the Loan Parties shall have entered into amendments, waivers,
forbearances (or extensions thereof) or other modifications reasonably
satisfactory to the Administrative Agent of each loan agreement evidencing the
existing Indebtedness of such Subsidiaries of the Loan Parties described on
Schedule 7.02 of the Credit Agreement and any other material Indebtedness of
such Subsidiaries (including, without limitation, the various loan agreements
among certain Subsidiaries of Holdings and The Royal Bank of Scotland plc, DVB
Group Merchant Bank (Asia) Ltd., Credit Suisse, AIG Commercial Equipment
Finance, Inc, Commerzbank AG and Berenberg Bank) deferring, forbearing or
continuing to defer or forbear any rights with respect to the failure to make
any payments of principal due under such loan agreements and any other
applicable defaults (including cross-defaults and defaults under any minimum
liquidity covenants contained therein) under such loan agreements to a date
which is no earlier than the Forbearance Termination Date (as hereby amended),
and the Administrative Agent shall have received a signed Officer’s
Certificate, certified by a duly authorized 

 

3

 

officer of Holdings to be true and complete, attaching true, correct
and complete fully executed copies of each such amendment, waiver, forbearance
(or extension thereof) and modification to each such loan agreement.

 

(c)           The Administrative
Agent shall have received evidence that all corporate action necessary for the
valid execution and delivery by the Loan Parties of this Amendment and the
performance of the transactions contemplated hereby and thereby shall have been
taken.

 

(d)           The Administrative
Agent shall have received, for its own account and the pro rata account of each
other Lender executing this Amendment, a forbearance fee in an amount equal to
five (5) basis points on aggregate amount of all outstanding Loans and
Letters of Credit of all Lenders executing this Amendment.

 

(e)           The Administrative
Agent shall have received payment for the fees, and expenses including, without
limitation, fees and expenses incurred by their counsel and their restructuring
advisors and other consultants, for which invoices or estimates therefor have
been provided to the Loan Parties on or prior to the First Amendment Effective
Date.

 

(f)            The representations
and warranties of each of the Loan Parties in the Credit Agreement and the
other Loan Documents shall be true and correct as of the First Amendment
Effective Date, except with respect to the occurrence of the Specified Defaults
referred to herein and to the extent that any of such representations and
warranties relate by their terms to a prior date they shall be true and correct
as of such prior date.

 

(g)           There shall have
occurred no Default or Event of Default other than the Specified Defaults.

 

§7.  No Present Claims; Release.  The Loan Parties hereby acknowledge and agree
that, as of the date hereof: (a) none of the Loan Parties or any of their
Affiliates has any claim or cause of action against the Administrative Agent or
any Lender (or any of their directors, officers, employees, attorneys or
agents); (b) none of the Loan Parties or any of their Affiliates, has
offset rights, counterclaims or defenses of any kind against any of their
obligations, indebtedness or liabilities to the Administrative Agent or any
Lender; and (c) the Administrative Agent and the Lenders have heretofore
properly performed and satisfied in a timely manner all of their obligations to
the Loan Parties and each of their Affiliates. 
The Administrative Agent and the Lenders wish (and the Loan Parties
agree) to eliminate any possibility that any past conditions, acts, omissions,
events, circumstances or matters would impair or otherwise adversely affect any
of the rights, interests, contracts, collateral security or remedies of the
Administrative Agent or the Lenders. 
Therefore, the Loan Parties, each on its own behalf and on behalf of
each of its respective successors and assigns, hereby waives, releases and
discharges the Administrative Agent and the Lenders and all of their directors,
officers, employees, attorneys and agents, from any and all claims, demands,
actions or causes of action on or before the date hereof and arising out of or
in any way relating to the Credit Agreement, the Loan Documents and any other
documents, instruments, agreements (including the Forbearance Agreement and
this Amendment), dealings or other matters connected with the Credit Agreement,
including, without limitation, all known and unknown matters, claims,
transactions or things occurring on or prior to the date of this Amendment
related to the Credit Agreement.  The waivers,
releases, and discharges contained in this paragraph shall be effective
regardless of any other event that may occur or not occur prior to, or on or
after the date hereof.

 

§8.  Expenses.  The Loan Parties jointly and severally agree
to pay on demand all expenses incurred by the Administrative Agent and the
Lenders in connection with the transactions contemplated by Amendment and the
Forbearance Agreement and in connection with any further amendments or 

 

4

 

waivers
(whether or not the same become effective) thereof and all expenses incurred by
the Administrative Agent in connection with the enforcement of any rights
hereunder or thereunder, including, without limitation, (i) the cost and
expenses of preparing and duplicating this Amendment, (ii) the reasonable
legal fees and all charges for costs, expenses and disbursements of Bingham
McCutchen LLP, special counsel to the Administrative Agent, in connection with
the transactions contemplated by this Amendment and the Forbearance Agreement
and any further amendments, modifications, approvals, consents or waivers
hereunder or thereunder, and (iii) all expenses, costs and liabilities,
incurred by the Administrative Agent in connection with (A) the
interpretation and administration of and exercise, enforcement or preservation
of rights under this Amendment or the Forbearance Agreement against any of the
Loan Parties or any of their officers or employees party thereto or the
administration thereof whether before or after the occurrence of a Default or
Event of Default and (B) any litigation, proceeding or dispute whether
arising hereunder or otherwise, in any way related to the relationship of the
Administrative Agent with the Loan Parties.

 

§9.  No Waiver.  Except as otherwise expressly provided for in
this Amendment and the Forbearance Agreement, nothing in this Amendment or the
Forbearance Agreement shall extend to or affect in any way any of the rights or
obligations of the Loan Parties or any of the Administrative Agent’s or Lenders’
obligations, rights and remedies arising under the Credit Agreement.  The Administrative Agent and the Lenders
shall not be deemed to have waived any or all of their rights or remedies with
respect to any Default or Event of Default existing on the date hereof or
arising hereafter.

 

§10.  Marshalling.  The Administrative Agent and the Lenders
shall not be required to marshal any present or future collateral security for
the Loan Parties’ obligations to the Administrative Agent and the Lenders under
the Credit Agreement or to resort to such collateral security or other
assurances of payment in any particular order, and all of their rights in
respect of such collateral security shall be cumulative and in addition to all
other rights, however existing or arising. 
To the extent that they lawfully may, the Loan Parties hereby agree that
they will not invoke any law relating to the marshalling of collateral which
might cause delay in or impede the Administrative Agent’s or any Lenders’ rights
under any document, agreement or instrument evidencing or securing the Loan
Parties’ obligations to the Administrative Agent and the Lenders under the
Credit Agreement and, to the extent that it lawfully may, each of the Loan
Parties hereby irrevocably waives the benefits of all such laws.

 

§11.  Miscellaneous.

 

(a)           THIS AMENDMENT SHALL
BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE OF NEW
YORK, EXCLUDING THE LAWS APPLICABLE TO CONFLICTS OR CHOICE OF LAW (OTHER THAN
THE NEW YORK GENERAL OBLIGATIONS LAW §5-1401 AND §5-1402).

 

(b)           This Amendment may
be executed in counterparts (and by different parties hereto in different
counterparts), each of which shall constitute an original, but all of which
when taken together shall constitute a single contract.  Delivery of an executed counterpart of a
signature page of this Amendment by facsimile, telecopy or other
electronic transmission shall be effective as delivery of a manually executed
counterpart of this Amendment.

 

(c)           This Amendment shall
constitute a Loan Document under the Credit Agreement; the failure to comply
with the covenants contained herein shall constitute an Event of Default under
the Credit Agreement; and all obligations included in this Amendment
(including, without limitation, all obligations for the payment of principal,
interest, fees, and other amounts and expenses) shall constitute obligations
under the Credit Agreement and secured by the collateral security for the
Obligations.

 

5

 

(d)           Wherever possible,
each provision of this Amendment shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision of this
Amendment shall be prohibited by or rendered invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provisions or the
remaining provisions of this Amendment.

 

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

 

6

 

If
you are in agreement with the foregoing, please sign and return the enclosed
copy of this Amendment to the Administrative Agent.

 

 

	
   

  	
  The
  Borrowers:

  
	
   

  	
   

  
	
   

  	
  ALBEMARLE
  MARITIME CORP.

  
	
   

  	
  ARDEN
  MARITIME CORP.

  
	
   

  	
  AVON
  MARITIME CORP.

  
	
   

  	
  BIRNAM
  MARITIME CORP.

  
	
   

  	
  BRISTOL
  MARITIME CORP.

  
	
   

  	
  CHESTER
  SHIPPING CORP.

  
	
   

  	
  CUMBERLAND
  NAVIGATION CORP.

  
	
   

  	
  DARBY
  NAVIGATION CORP.

  
	
   

  	
  DOVER
  MARITIME CORP.

  
	
   

  	
  ELROD
  SHIPPING CORP.

  
	
   

  	
  EXETER
  SHIPPING CORP.

  
	
   

  	
  FRANKFORT
  MARITIME CORP.

  
	
   

  	
  GLENWOOD
  MARITIME CORP.

  
	
   

  	
  HANSEN
  SHIPPING CORP.

  
	
   

  	
  HARTLEY
  NAVIGATION CORP.

  
	
   

  	
  HENLEY
  MARITIME CORP.

  
	
   

  	
  HUDSON
  MARITIME CORP.

  
	
   

  	
  JESSUP
  MARITIME CORP.

  
	
   

  	
  MONTROSE
  MARITIME CORP.

  
	
   

  	
  OLDCASTLE
  SHIPPING CORP.

  
	
   

  	
  QUENTIN
  NAVIGATION CORP.

  
	
   

  	
  RECTOR
  SHIPPING CORP.

  
	
   

  	
  REMSEN
  NAVIGATION CORP.

  
	
   

  	
  SHEFFIELD
  MARITIME CORP.

  
	
   

  	
  SHERMAN
  MARITIME CORP.

  
	
   

  	
  STERLING
  SHIPPING CORP.

  
	
   

  	
  STRATFORD
  SHIPPING CORP.

  
	
   

  	
  VEDADO
  MARITIME CORP.

  
	
   

  	
  VERNON
  MARITIME CORP.

  
	
   

  	
  WINDSOR
  MARITIME CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
  Title:   Attorney-in-Fact

  

 

 

	
   

  	
  Holdings:

  
	
   

  	
   

  
	
   

  	
  TBS
  INTERNATIONAL LIMITED

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
  Title:
    Attorney-in-Fact

  
	
   

  	
   

  
	
   

  	
  TBS
  INTERNATIONAL PLC

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
  Title:
    Attorney-in-Fact

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  The
  Administrative Borrower:

  
	
   

  	
   

  
	
   

  	
  TBS
  SHIPPING SERVICES INC.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
  Title:
    Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  The
  Guarantors:

  
	
   

  	
   

  
	
   

  	
  TBS U.S. ENTERPRISES LLC

  
	
   

  	
   

  
	
   

  	
   

  	
  By:
  TBS SHIPPING SERVICES INC., its
  sole member

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
   

  	
  Title:
  Secretary

  
	
   

  	
   

  
	
   

  	
  TBS ENERGY LOGISTICS L.P.

  
	
   

  	
   

  
	
   

  	
   

  	
  By:
  TBS U.S. ENTERPRISES LLC, its
  general partner

  
	
   

  	
   

  
	
   

  	
   

  	
  By:
  TBS SHIPPING SERVICES INC., its
  sole member

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
   

  	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
   

  	
   

  	
  Title:
    Secretary

  
							

 

 

	
   

  	
  The
  Guarantors (continued):

  
	
   

  	
   

  
	
   

  	
  TBS LOGISTICS INCORPORATED

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
  Title:   Assistant Secretary

  
	
   

  	
   

  
	
   

  	
  ROYMAR SHIP MANAGEMENT, INC.

  
	
   

  	
  TBS SHIPPING SERVICES INC.

  
	
   

  	
  AZALEA SHIPPING & CHARTERING, INC.

  
	
   

  	
  COMPASS CHARTERING CORP.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
  Title:   Secretary

  
	
   

  	
   

  
	
   

  	
  TBS
  INTERNATIONAL PLC

  
	
   

  	
  TBS
  INTERNATIONAL LIMITED

  
	
   

  	
  TBS
  HOLDINGS LIMITED

  
	
   

  	
  WESTBROOK HOLDINGS LTD.

  
	
   

  	
  TRANSWORLD
  CARGO CARRIERS, S.A.

  
	
   

  	
  MERCURY
  MARINE LTD. (F/K/A TBS LOGISTICS LTD.)

  
	
   

  	
  TBS
  WORLDWIDE SERVICES INC.

  
	
   

  	
  BEEKMAN
  SHIPPING CORP.

  
	
   

  	
  FAIRFAX
  SHIPPING CORP.

  
	
   

  	
  LEAF
  SHIPPING CORP.

  
	
   

  	
  PACIFIC
  RIM SHIPPING CORP.

  
	
   

  	
  TBS
  AFRICAN VENTURES LIMITED

  
	
   

  	
  TBS DO SUL LTD.

  
	
   

  	
  TBS EUROLINES, LTD.

  
	
   

  	
  TBS
  HOLDINGS LIMITED

  
	
   

  	
  TBS
  LATIN AMERICA LINER, LTD.

  
	
   

  	
  TBS
  MIDDLE EAST CARRIERS, LTD.

  
	
   

  	
  TBS
  NORTH AMERICA LINER LTD.

  
	
   

  	
  TBS OCEAN CARRIERS, LTD.

  
	
   

  	
  TBS PACIFIC LINER, LTD.

  
	
   

  	
  TBS WAREHOUSE & DISTRIBUTION GROUP LTD.

  
	
   

  	
  TBS WAREHOUSE & EQUIPMENT HOLDINGS LTD.

  
	
   

  	
  TBS LOGISTICS INCORPORATED

  
	
   

  	
  TBSI NEW SHP DEVELOPMENT CORP.

  
	
   

  	
  TBS MINING LIMITED

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Tara DeMakes

  
	
   

  	
  Name:
  Tara DeMakes

  
	
   

  	
  Title:   Attorney-in-Fact

  

 

 

	
   

  	
  The
  Administrative Agent:

  
	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Judith A. Huckins

  
	
   

  	
  Name:
  Judith A. Huckins

  
	
   

  	
  Title:
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  The
  Required Lenders:

  
	
   

  	
   

  
	
   

  	
  BANK
  OF AMERICA, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Judith A. Huckins

  
	
   

  	
  Name:
  Judith A. Huckins

  
	
   

  	
  Title:  Vice President

  

 

 

	
   

  	
  The
  Required Lenders (continued):

  
	
   

  	
   

  
	
   

  	
  DVB GROUP MERCHANT BANK (ASIA) LTD.,

  
	
   

  	
  as
  co-Syndication Agent and a Lender

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Evan Cohen

  
	
   

  	
  Name:
  Evan Cohen

  
	
   

  	
  Title:
  Director

  

 

 

	
   

  	
  CITIBANK, N.A., as co-Syndication Agent
  and a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  N. Thomas Eck

  
	
   

  	
  Name:

  	
  N.
  Thomas Eck

  
	
   

  	
  Title:

  	
  Vice
  President

  

 

 

	
   

  	
  KEYBANK NATIONAL ASSOCIATION, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Richard B. Soulberry

  
	
   

  	
  Name:

  	
  Richard
  B. Soulberry

  
	
   

  	
  Title:

  	
  Vice
  President

  

 

 

	
   

  	
  CAPITAL
  ONE LEVERAGE FINANCE CORP., as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Thomas F. Furst

  
	
   

  	
  Name:

  	
  Thomas
  F. Furst

  
	
   

  	
  Title:

  	
  Vice
  President

  

 

 

	
   

  	
  MERRILL
  LYNCH COMMERCIAL FINANCE CORP., as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Judith A. Huckins

  
	
   

  	
  Name:

  	
  Judith
  A. Huckins

  
	
   

  	
  Title:

  	
  Vice
  President

  

 

 

	
   

  	
  WEBSTER BANK NATIONAL ASSOCIATION, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Stephen J. Corcoran

  
	
   

  	
  Name:

  	
  Stephen
  J. Corcoran

  
	
   

  	
  Title:

  	
  Senior
  Vice President

  

 

 

	
   

  	
  COMERICA BANK, as a Lender

  
	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Sarah R. Miller

  
	
   

  	
  Name:

  	
  Sarah
  R. Miller

  
	
   

  	
  Title:

  	
  Vice
  PresidentExhibit 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

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00181-of-00352.parquet"}]]