The singer's ship sails from Plymouth and is intercepted by the Terrible. The fight continued until "our captain and our men being slain, We could no longer the fight maintain." Twenty-seven are held in prison until "the Carteel did fetch us away"
There seem to have been at least two songs about this incident, this one and one called "Captain Death." Both appear on the same semi-legible Bodleian broadside, and they are printed together in the _Publications of the Navy Records Society_ by C. H. Firth available on Google Books (p. 204 in the print copy; p. 335 of the Google Books PDF file). Logan, _The Pedlar's Pack_, prints another text of "Captain Death" on pp. 30-31.
According to the online book _How Britannia Came to Rule the Waves_, by W. H. G. Kingston, this refers to an incident of the Seven Years' War. The _Terrible_, 26 guns, commanded by Captain Death (really! -- though his true name seems to have been "Osborn"), had already taken one prize, but had suffered in the fight and was defeated by another privateer, the _Vengeance_ of St. Malo; Death and half his crew were killed in the battle.
The story of the _Terrible_ so aroused the British that a subscription was raised which eventually bought the freedom of the remaining privateers.
Logan's version of the legend is even more amazing than that of the broadsides: The _Terrible_ "was equipped at Execution Dock, commanded by CaptainDeath. The appellation of his Lieutenant was Devil, and the surgeon's name was Ghost.." Logan does note that Ritson thought this catalog of coincidences "entirely void of foundation." - RBW