SUPPLEMENTAL LETTER TO THE LOAN AGREEMENT

the maximum Consolidated Leverage Ratio set out in paragraph (b) of Schedule 3 to the Loan Agreement shall be reset for the fiscal quarters ending 30 June 2011, 30 September 2011 and 31 December 2011 as follows:-

the minimum Consolidated Interest Charges Coverage Ratio set out in paragraph (c) of Schedule 3 of the Loan Agreement shall be reset for the fiscal quarters ending 30 June, 30 September 2011 and 31 December 2011 as follows:

for the period beginning with the week ending 1 July 2011 until 31 December 2011 (inclusive) the Minimum Liquidity covenant set out in paragraph (a) of Schedule 3 of the Loan Agreement shall be temporarily replaced by the following covenant of the Borrowers:

notwithstanding anything to the contrary in the Loan Agreement and the Supplemental Agreement:

the amendments to the Consolidated Leverage Ratio, the Consolidated Interest Charges Coverage Ratio and the Minimum Liquidity Covenant set out in this letter do not change any required covenant levels in the Loan Agreement for the periods after 2011 and nothing in this letter shall be construed as any commitment of any kind by the Lender to effect any further changes to those covenant ratios after the end of 2011 from those set out in the Loan Agreement;

as required by clause 10.6(d) of the Loan Agreement, the New Guarantor provides a rolling 13 week cash flow forecast to the Lender on a weekly basis.  To the extent that the New Guarantor delivers a rolling 13-week cash flow forecast projecting that Qualified Cash will, or is likely to, fall below the minimum required weekly average during the then current week or during any of the next four forecasted weeks, such forecast shall itself constitute a breach of the Minimum Liquidity Covenant and the New Guarantor shall promptly conduct a bank update call with the Lender to discuss liquidity issues;

additional capital contributions, separate from the Capital Infusions already received by or pledged to the New Guarantor (such contributions, the “Incremental Capital Contributions”), may be received by the New Guarantor after the date hereof and prior to 1 January 2012 in respect of the issuance of preferred equity, common equity or Permitted Subordinated Debt (as defined below) and the New Guarantor shall provide the Lender with weekly updates as regards the status of its efforts to raise fresh equity and the ongoing progress of any such Incremental Capital Contributions.

does not contain any provisions relating to cross default with any other debt of the Borrowers, the Collateral Owner or any Guarantor; and

Incremental Capital Contributions received on or after the date of this letter and prior to 1 January 2012 shall be deposited directly in the Special Account.  The existing limits on amounts deposited and able to be re-deposited in the Special Account set out in clause 4 of the Supplemental Agreement shall be increased to include any such Incremental Capital Contributions received in 2011 as described above;

all amounts in the Special Account including amounts already deposited as of the date hereof and any Incremental Capital Contributions that may be deposited during 2011, shall not be included in the calculation of Excess Cash set out at clause 6.1 of the Supplemental Agreement for the purposes of the prepayments to be made pursuant to clause 6.3 of the Supplemental Agreement; and

for the avoidance of doubt any common or preferred equity issued in return for an Incremental Capital Infusion shall be subject to the dividend restrictions imposed on the New Guarantor and as set out in relation to the Preferred Equity in clause 4.7 of the Supplemental Agreement.

the Lender receiving satisfactory evidence that the New Guarantor and/or its applicable subsidiaries have entered into amendments on or before the date of this letter in respect of each of the other TBS Credit Facilities modifying the financial covenants thereunder in line with the modifications being made to the Loan Agreement as set out in this letter; and

at the date of this letter, and after giving effect thereto, no Event of Default has occurred and is continuing and the representations and warranties in clause 9 of the Loan Agreement would be true and not misleading if repeated on the date hereof with reference to the circumstances then existing; and