Exhibit 10.12

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

Dear Sirs

ISDA Master Agreement dated as of 29 March 2009 (together with the schedules thereto and confirmations thereunder) as amended made between (i) Argyle Maritime Corp., Caton Maritime Corp., Dorchester Maritime Corp., Longwoods Maritime Corp., McHenry Maritime Corp. and Sunswyck Maritime Corp. acting jointly and severally and (ii) The Royal Bank of Scotland plc (the “Master Agreement”)

We refer to the Master 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 Master 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 Master 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:-

TBS - Swap Facility Forbearance Extension (Nov 2010)

(a)                                  the repayment of principal instalments each in the amount of $417,500 which are scheduled due under the Loan Facility 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 Facility 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 Facility and Other Credit Facilities, we confirm as Party A under the Master Agreement our agreement not to exercise during the Extended Suspension Period any of our rights or remedies under the Master Agreement and the Credit Support Documents arising from the Events of Default due to such payment default and Extended Suspension Period under Clauses 5(a)(iii)(1) and 5(a)(vi) of the Master 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 Master Agreement:-

1.                                       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;

2.                                       the New Corporate Guarantor to provide within 35 days from the end of each calendar month monthly financials including income statements, balance sheets, cash flows and key performance indicators for the business;

3.                                       J Alix Partners to continue as financial adviser to the New Corporate Guarantor and Corporate Guarantor until otherwise agreed in writing by us as Party A under the Master Agreement.  Should J Alix Partners terminate their existing involvement with the New Corporate Guarantor and Corporate Guarantor an alternative financial advisor, satisfactory us as Party A under the Master Agreement, 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 us as Party A under the Master Agreement;

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

5.                                       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 us as Party A under the Master Agreement.

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 our rights and remedies arising from the Events of Default specified in (A) shall cease to be effective or shall terminate as the case may be and we as Party A under the Master Agreement shall remain entitled to exercise our rights under the Master Agreement and Credit Support Documents arising from such Events of Default.  Furthermore we reserve all our rights and remedies under the Master Agreement and Credit Support 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 Master Agreement shall remain unchanged and in full force and effect.

This letter shall constitute a Credit Support Document for the purposes of the Master Agreement.

The provisions of clause 13 (Law and Jurisdiction) of the Master 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”.

Accepted and agreed

for and on behalf of

Schedule