Document:

EXECUTION VERSION

        
        FIRST AMENDMENT AND WAIVER TO DEBTOR-IN-POSSESSION CREDIT AND SECURITY
        AGREEMENT

        
        FIRST AMENDMENT AND WAIVER, dated as of
        December 20, 2007 (this
        “Amendment”), to the
        Debtor-in-Possession Credit and Security Agreement, dated as of November 19, 2007 (as
        heretofore amended or otherwise modified, the “Credit
        Agreement”), by and among POPE & TALBOT, INC., a
        Delaware corporation, as a debtor and debtor-in-possession under the US Bankruptcy Code and
        as a debtor company under the CCAA (the
        “Parent”), POPE & TALBOT
        LTD., a Canadian corporation, as a debtor and debtor-in-possession under the US Bankruptcy
        Code, and as a debtor company under the CCAA (the
        “Borrower”), the Guarantors
        set forth on the signature pages thereto, the several banks and other financial
        institutions or entities from time to time parties thereto (the
        “Lenders”), WELLS FARGO
        FINANCIAL CORPORATION CANADA, a Nova Scotia unlimited liability company, as administrative
        agent (in such capacity, together with its permitted successors and assigns, the
        “Administrative Agent”),
        ABLECO FINANCE LLC, as Collateral Agent (in such capacity, together with its permitted
        successors and assigns, the “Collateral
        Agent”), and ABLECO FINANCE LLC, as Term Loan B Agent (in
        such capacity, together with its permitted successors and assigns, the
        “Term Loan B Agent” and
        together with the Administrative Agent and the Collateral Agent, each an
        “Agent” and collectively,
        the “Agents”).

        
        WHEREAS, in order to conform the Credit Agreement to the final order entered
        by the US Bankruptcy Court in respect of the Chapter 11 Cases on December 7, 2007 (the
        “Order”), and to correct any
        inconsistencies between the Credit Agreement and the Order, the Parent and the Borrower
        have requested that the Agents and the Lenders consent to the amendment of certain terms
        and conditions of the Credit Agreement as hereinafter set forth; and

        
        WHEREAS, the Agents and the Lenders are willing to enter into this Amendment
        in order to amend certain terms and conditions of the Credit Agreement, subject to the
        terms and conditions set forth in this Amendment.

        
        NOW, THEREFORE, the Parent, the Borrower, the Agents and the Lenders hereby
        agree as follows:

        
        1.         
        Capitalized Terms. Any capitalized term used
        herein which is defined in the Credit Agreement shall have the meaning assigned to it in
        the Credit Agreement.

        
        2.         
        Definitions. Section 1.1 of the Credit
        Agreement is hereby amended by deleting the phrase “sub-clause (iii)” in the
        lead-in of the definition of the term “Agreed Administrative Expense
        Priorities” and substituting therefore the phrase “sub-clauses (ii) and
        (iii)”.

        
        3.         
        Revolving Credit Loans. Section 2.5 of the
        Credit Agreement is hereby amended by inserting in sub-clause (2) of clause (x) of the
        proviso contained in the first sentence of clause

         

        
        

        

        

        

        (a)
        contained therein the phrase “plus the principal amount of any Revolving Credit Loans
        resulting from an L/C Disbursement pursuant to a Pre-Petition Letter of Credit made on or
        prior to the date thereof” after the phrase “for any week, the principal amount
        of the Revolving Credit Loans projected to be outstanding during such week as set forth in
        the Initial Budget for such week” contained therein.

        
        4.         
        Sale Procedure. Sections 6.17(b) and (c) of the
        Credit Agreement are hereby amended by deleting them in their entirety and by substituting
        therefor as follows:

        
        “(b)     In the case of the wood products
        business of the Parent and its Subsidiaries:

        
        (i)        On or before December 3,
        2007, obtain one or more orders of the Bankruptcy Courts in form and substance reasonably
        satisfactory to the Agents approving the procedures for sale of all or substantially all of
        the assets of the wood products business;

        
        (ii)       On or before December 20,
        2007, conduct one or more auctions for the sale of all or substantially all of the assets
        of the wood products business;

        
        (iii)      On or before January 8, 2008,
        obtain one or more orders of the Bankruptcy Courts approving the sale of all or
        substantially all of the assets of the wood products business; and

        
        (iv)      Consummate, as soon as practicable
        after the conditions to closing as set forth in the relevant asset purchase agreement are
        satisfied and/or waived, but in any event no later than January 31, 2008, one or more sales
        of all or substantially all of the assets of the wood products business.

        
            	
                        
                         

                    	
                        
                        (c)

                    	
                        
                        In the case of the pulp business of the Parent and its
                        Subsidiaries:

                    

        

        
        (i)        On or before December 7,
        2007, obtain one or more orders of the Bankruptcy Courts in form and substance reasonably
        satisfactory to the Agents approving the procedures for sale of all or substantially all of
        the assets of the pulp business;

        
        (ii)       On or before February 5, 2008,
        conduct one or more auctions for the sale of all or substantially all of the assets of the
        pulp business;

        
        (iii)      On or before February 12, 2008,
        obtain one or more orders of the Bankruptcy Courts approving the sale of all or
        substantially all of the assets of the pulp business; and

         

        
        -2-

         

        
        

        

        

        

        
        (iv)      Consummate, as soon as practicable
        after the conditions to closing as set forth in the relevant asset purchase agreement are
        satisfied and/or waived, but in any event no later than the Final Maturity Date, one or
        more sales of all or substantially all of the assets of the pulp
        business.”

        
        5.         
        Events of Default.

        
        (a) Section 8 (c) of the Credit Agreement is hereby amended by deleting it
        in its entirety and by substituting therefor as follows:

        
        “(c)     (i) Any Loan Party shall default in
        the observance or performance of any agreement contained in Sections 6.1, 6.2 (other than
        Sections 6.2(e) 6.2(f), and 6.2(1)), 6.4, 6.5, 6.6, 6.7(a), 6.11, 6.12, 6.13, 6.14, 6.17 or
        Section 7, in Section 6 of any Pledge and Security Agreement, or in Section 6 of any
        Canadian General Security Agreement, or (ii) an “Event of Default” under and as
        defined in any Mortgage shall have occurred and be continuing; or”

        
        (b) Section 8 (f) of the Credit Agreement is hereby amended by deleting it
        in its entirety and by substituting therefor as follows:

        
        “(f)      Any Loan Party shall default in the
        observance or performance of any agreement contained in Section 6.2(1), and such default
        shall continue unremedied for a period of 1 Business Day; or”

        
        6.         
        Limited Waivers.

        
        (a) In accordance with Section 10.1 of the Credit Agreement and
        notwithstanding any of the provisions otherwise set forth in the Credit Agreement, as of
        the Amendment Effective Date, the Majority Facility Lenders in respect of the Term Loan and
        the Majority Revolving Credit Facility Lenders hereby irrevocably and permanently waive any
        Default or Event of Default whether now existing or hereafter arising under Section 8
        (a)(a) of the Credit Agreement resulting from the occurrence of a Material Adverse
        Deviation with respect to the disbursement line items for Professional Fees, Chemicals and
        Utilities/Energy set forth in the Initial Budget during the weeks ended December 21, 2007
        and December 28, 2007.

        
        (b) The waiver set forth in this Section 6 shall (i) become effective after
        satisfaction of the conditions set forth in Section 7, (ii) shall be effective only in this
        specific instance and for the specific purposes set forth herein, and (iii) does not allow
        for any other or further departure from the terms and conditions of the Credit Agreement or
        any other Loan Document, which terms and conditions shall continue in full force and
        effect.

        
        7.         
        Conditions. This Amendment shall become
        effective as of December 20,2007, but only upon the satisfaction in full, in a manner
        reasonably satisfactory to the Agents, of the following conditions precedent (the first
        date upon which all such conditions have been satisfied being herein called the
        “Amendment Effective
        Date”):

         

        
        -3-

         

        
        

        

        

        

        
        (a)       
        Representations and Warranties. The
        representations and warranties contained in this Amendment and in Section 4 of the Credit
        Agreement and in each other Loan Document, certificate or other writing delivered on or on
        behalf of any Loan Party to any Agent or any Lender pursuant to the Credit Agreement or any
        other Loan Document on or prior to the Amendment Effective Date shall be true and correct
        on and as of the Amendment Effective Date as though made on and as of such date (except
        where such representations and warranties relate to an earlier date in which case such
        representations and warranties shall be true and correct as of such earlier
        date).

        
        (b)        No
        Event of Default. No Default or Event of Default shall have
        occurred and be continuing on the Amendment Effective Date or would result from this
        Amendment becoming effective in accordance with its terms.

        
        (c)       
        Delivery of Documents. The Collateral Agent
        shall have received on or before the Amendment Effective Date the following, each in form
        and substance reasonably satisfactory to the Collateral Agent and, unless indicated
        otherwise, dated the Amendment Effective Date:

        
        (i)        counterparts of this
        Amendment which bear the signatures of the Parent, the Borrower, the Agents and the
        Majority Facility Lenders in respect of the Term Loan and the Majority Revolving Credit
        Facility Lenders; and

        
        (ii)       an acknowledgment and consent,
        in the form attached as Exhibit A to this Amendment, duly executed by each
        Guarantor.

        
        (d)       
        Proceedings. All legal matters incident to this
        Amendment shall be reasonably satisfactory to the Agents and their counsel.

        
        8.         
        Representations and Warranties. To induce the
        Agents and Lenders to enter into this Amendment, each of the Parent and the Borrower hereby
        represents and warrants to the Agents and Lenders as follows:

        
        (a)       
        Organization, Good Standing, Etc.  Each
        Loan Party (i) is duly organized, validly existing and in good standing under the laws of
        the state or jurisdiction of its organization, (ii) has all requisite power and authority
        to conduct the business in which it is currently engaged, and to execute and deliver this
        Amendment, and to consummate the transactions contemplated hereby and by the Credit
        Agreement, as amended hereby, and (iii) is duly qualified to do business and is in good
        standing in each jurisdiction in which its ownership, lease or operation of Property or the
        conduct of its business requires such qualification, except where the failure to be so
        qualified could not reasonably be expected to have a Material Adverse Effect.

        
        (b)       
        Authorization, Etc.  The execution,
        delivery and performance of this Amendment and each other Loan Document being executed in
        connection with this Amendment by each Loan Party that is a party thereto, and the
        performance of the Credit

         

        
        -4-

         

        
        

        

        

        

        Agreement
        as amended hereby (i) have been duly authorized by all necessary action, (ii) do not and
        will not contravene any Loan Party’s Constituent Documents or any applicable law or
        any material contractual restriction binding on or otherwise affecting it or any of its
        properties, (iii) do not and will not result in or require the creation of any Lien (other
        than pursuant to any Loan Document) upon or with respect to any of its properties, and (iv)
        do not and will not result in any default, noncompliance, suspension, revocation,
        impairment, forfeiture or nonrenewal of any material permit, license, authorization or
        approval applicable to its operations or any of its properties.

        
        (c)       
        Governmental Approvals. No authorization or
        approval or other action by, and no notice to or filing with, any Governmental Authority or
        other regulatory body is required in connection with the due execution, delivery and
        performance by any Loan Party of this Amendment or any other Loan Document to which it is a
        party being executed in connection with this Amendment, or for the performance of the
        Credit Agreement, as amended hereby.

        
        (d)       
        Enforceability of Loan Documents. Each of this
        Amendment, the Credit Agreement, as amended hereby, and each other Loan Document is a
        legal, valid and binding obligation of each Loan Party party thereto, enforceable against
        such Loan Party in accordance with its terms, except as such enforceability may be limited
        by applicable bankruptcy, insolvency, reorganization, moratorium or other similar laws of
        general application relating to the enforcement of creditor’s rights and by general
        equitable principles.

        
        (e)       
        Representations and Warranties; No Event of
        Default. The representations and warranties herein, in Section 4
        of the Credit Agreement and in each other Loan Document are true and correct on and as of
        the Amendment Effective Date as though made on and as of such date (except where such
        representations and warranties relate to an earlier date in which case such representations
        and warranties shall be true and correct as of such earlier date), and no Default or Event
        of Default has occurred and is continuing as of the Amendment Effective Date or would
        result from this Amendment becoming effective in accordance with its terms.

        
        (f)        
        Existing Indentures. No consent with respect to
        the execution, delivery or performance of this Amendment is required under the Existing
        Indentures.

        
        9.         
        Continued Effectiveness of the Credit Agreement and Loan
        Documents. Each of the Parent and the Borrower hereby (i)
        acknowledges and consents to this Amendment, (ii) confirms and agrees that each Loan
        Document to which it is a party is, and shall continue to be, in full force and effect and
        is hereby ratified and confirmed in all respects except that on and after the Amendment
        Effective Date all references in any such Loan Document to “the Credit
        Agreement”, the “Agreement”, “thereto”, “thereof
        ‘, “thereunder” or words of like import referring to the Credit Agreement
        shall mean the Credit Agreement as amended by this Amendment, and (iii) confirms and agrees
        that to the extent that any such Loan Document purports to assign or pledge to the
        Collateral Agent for the ratable benefit of the Secured Parties, or to grant to the
        Collateral Agent for the ratable benefit of the Secured Parties a security
        interest

         

        
        -5-

         

        
        

        

        

        

        in or Lien
        on, any Collateral as security for the Obligations of any Loan Party from time to time
        existing in respect of the Credit Agreement and the Loan Documents, such pledge, assignment
        and/or grant of the security interest or Lien is hereby ratified and confirmed in all
        respects. This Amendment does not and shall not affect any of the Obligations of any Loan
        Party, other than as expressly provided herein.

        
        10.       
        Amendment as Loan Document. Each of the Parent
        and the Borrower hereby acknowledges and agrees that this Amendment constitutes a
        “Loan Document” under the Credit Agreement. Accordingly, it shall be an Event
        of Default under the Credit Agreement if (1) any representation or warranty made by the
        Parent or the Borrower under or in connection with this Amendment shall have been untrue,
        false or misleading in any material respect when made, or (2) the Parent or the Borrower
        shall fail to perform or observe any term, covenant or agreement contained in this
        Amendment.

        
        11.       
        Miscellaneous.

        
        (a)       This Amendment may be executed
        in any number of counterparts and by different parties hereto in separate counterparts,
        each of which shall be deemed to be an original but all of which taken together shall
        constitute one and the same agreement. Delivery of an executed counterpart of this
        Amendment by telefacsimile or electronic mail shall be equally effective as delivery of an
        original executed counterpart of this Amendment. Any party delivering an executed
        counterpart of this Amendment by telefacsimile or electronic mail also shall deliver an
        original executed counterpart of this Amendment, but the failure to deliver an original
        executed counterpart shall not affect the validity, enforceability and binding effect of
        this Amendment.

        
        (b)       Section and paragraph headings
        herein are included for convenience of reference only and shall not constitute a part of
        this Amendment for any other purpose.

        
        (c)       The Borrower will pay on demand
        all reasonable fees, costs and expenses of the Agents in connection with the preparation,
        execution and delivery of this Amendment and all documents incidental hereto, including,
        without limitation, the reasonable fees, disbursements and other charges of counsel to the
        Collateral Agent and the Administrative Agent.

        
        (d)       THIS AMENDMENT SHALL BE
        GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW
        YORK.

        
        (e)       Any provision of this Agreement
        that is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be
        ineffective to the extent of such prohibition or unenforceability without invalidating the
        remaining portions hereof or affecting the validity or enforceability of such provision in
        any other jurisdiction.

        
        (f)        THE PARTIES HERETO HEREBY
        IRREVOCABLY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY CLAIM OR CAUSE OF
        ACTION

         

        
        -6-

         

        
        

        

        

        

        BASED UPON
        OR ARISING OUT OF THIS AMENDMENT OR ANY OF THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING
        CONTRACT CLAIMS, TORT CLAIMS, BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY
        CLAIMS.

        
        [Signature Page Follows]

         

        
        -7-

         

        
        

        

        

        
        IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
        executed and delivered as of the date set forth on the first page hereof.

         

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        PARENT:

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        POPE & TALBOT, INC., as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code and as a debtor company
                        under the CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        BORROWER:

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        POPE & TALBOT, LTD., as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code and as a debtor company
                        under the CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        COLLATERAL AGENT AND TERM LOAN B
                        AGENT:

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        ABLECO FINANCE LLC,

                        on behalf of itself and its Affiliate assigns

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Kevin Gerda

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Kevin Gerda

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice- Chairman

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -8-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        ADMINISTRATIVE AGENT AND
                        LENDER:

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        WELLS FARGO FINANCIAL CORPORATION CANADA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Nick Scarfo

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Nick Scarfo

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -9-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        LENDERS:

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        STYX PARTNERS, L.P.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        Styx Associates, LLC, as its General Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Kevin Gerda

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Kevin Gerda

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Sr. Managing Director

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -10-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        OHSF FINANCING, LTD.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        OHSF II FINANCING, LTD.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        OAK HILL CREDIT OPPORTUNITIES FINANCING, LTD.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        OAK HILL CREDIT ALPHA FINANCE I, LLC

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        Oak Hill Credit Alpha Fund, L.P.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        its Member

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        Oak Hill Credit Alpha Gen Par, L.P.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        its General Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        Oak Hill Credit Alpha MGP, LLC,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        its General Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -11-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        OAK HILL CREDIT ALPHA FINANCE I

                        (OFFSHORE), LTD.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        LERNER ENTERPRISES, L.P.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        Oak Hill Advisors, L.P., as Investment

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Advisor for Lerner Enterprises, L.P.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        OHA CAPITAL SOLUTIONS, L.P.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        OHA Capital Solutions GenPar, L.P.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        its General Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        OHA Capital Solutions MGP, LLC,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        its General Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        OHA CAPITAL SOLUTIONS, LTD.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Scott D. Krase

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -12-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        REGIMENT CAPITAL SPECIAL SITUATIONS FUND III,
                        L.P.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        Regiment Capital GP, LLC, its General

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Richard Miller

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Richard Miller

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -13-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        DRAWBRIDGE SPECIAL OPPORTUNITIES FUND LP

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        Drawbridge Special Opportunities GP LLC,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        its general partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -14-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        CREDIT GENESIS CLO 2005-I, LTD.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ T.K. Duggan

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  T.K. Duggan

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Managing Principal

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        DURHAM ACQUISITION CO., LLC

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ T.K. Duggan

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  T.K. Duggan

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Managing Principal

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -15-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        HBK MASTER FUND L.P.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        HBK Services LLC

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        its Investment Advisor

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ J. Baker Gentry, Jr.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  J. Baker Gentry, Jr.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Authorized Signatory

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -16-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        BANK OF AMERICA, N.A.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Jonathan M. Barnes

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Jonathan M. Barnes

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -17-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        CONCORDIA DISTRESSED DEBT FUND, L.P. acting by and through
                        Concordia Advisors, L.L.C., as a Lender

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -18-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        QUADRANGLE MASTER FUNDING LTD

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        Quadrangle Debt Recovery Advisors LP

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Its:  Advisor

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Christopher Santana

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Christopher Santana

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Managing Principal

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -19-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        DK ACQUISITION PARTNERS, L.P.

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        M.H. Davidson & Co., its General Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -20-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        ABN AMRO BANK N.V., Canada Branch

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ David Carson

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  David Carson

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ Aaron Turner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  Aaron Turner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Senior Vice President

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -21-

         

        
        

        

        

        

        
        EXHIBIT A

        
        ACKNOWLEDGMENT AND CONSENT

        
        The undersigned, as a party to one or more Loan Documents, as defined in the
        Debtor-in-Possession Credit and Security Agreement dated as of November 19, 2007 (as
        heretofore amended or otherwise modified, the “Credit
        Agreement”), by and among POPE & TALBOT, INC., a
        Delaware corporation, as a debtor and debtor-in-possession under the US Bankruptcy Code
        (the “Parent”), POPE &
        TALBOT LTD., a Canadian corporation, as a debtor and debtor-in-possession under the US
        Bankruptcy Code, and as a debtor company under the CCAA (the
        “Borrower”), the Guarantors
        set forth on the signature pages thereto, the several banks and other financial
        institutions or entities from time to time parties thereto (the
        “Lenders”), WELLS FARGO
        FINANCIAL CORPORATION CANADA, a Nova Scotia unlimited liability company, as administrative
        agent (in such capacity, together with its permitted successors and assigns, the
        “Administrative Agent”),
        ABLECO FINANCE LLC, as Collateral Agent (in such capacity, together with its permitted
        successors and assigns, the “Collateral
        Agent”), and ABLECO FINANCE LLC, as Term Loan B Agent (in
        such capacity, together with its permitted successors and assigns, the
        “Term Loan B Agent” and
        together with the Administrative Agent and the Collateral Agent, each an
        “Agent” and collectively,
        the “Agents”), hereby (i)
        acknowledges and consents to the First Amendment dated the date hereof (the
        “Amendment”, all terms
        defined therein being used herein as defined therein) to the Credit Agreement; (ii)
        confirms and agrees that each Loan Document to which it is a party is, and shall continue
        to be, in full force and effect and is hereby ratified and confirmed in all respects except
        that on and after the Amendment Effective Date all references in any such Loan Documents to
        “the Credit Agreement”, “thereto”, “thereof”,
        “thereunder” or words of like import referring to the Credit Agreement shall
        mean the Credit Agreement as amended by the Amendment; and (iii) confirms and agrees that
        to the extent that any such Loan Document purports to assign or pledge to the Collateral
        Agent, for the benefit of the Secured Parties, or to grant to the Collateral Agent, for the
        benefit of the Secured Parties, a security interest in or lien on, any collateral as
        security for the obligations of any Guarantor 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, in addition to the other
        obligations secured thereby, all obligations of such Guarantors outstanding upon the taking
        effect of the Amendment.

        Dated: as
        of December __, 2007

        
        [signature pages follow]

        
         

        
        -22-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        POPE & TALBOT SPEARFISH LIMITED PARTNERSHIP, as a Debtor
                        and Debtor-in-Possession under the US Bankruptcy Code

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        POPE & TALBOT LTD.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        as a Debtor and Debtor-in-Possession under the US Bankruptcy
                        Code and as a debtor company under the CCAA, as its General
                        Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        PENN TIMBER, INC., as a Debtor and Debtor-in-Possession
                        under the US Bankruptcy Code and as a debtor company under the
                        CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                    	
                    	
                    	
                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        POPE & TALBOT RELOCATION SERVICES, INC., as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code and as a debtor company
                        under the CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                    	
                    	
                    	
                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        P&T POWER COMPANY, as a Debtor and Debtor-in-Possession
                        under the US Bankruptcy Code and as a debtor company under the
                        CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -23-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        POPE & TALBOT PULP SALES U.S., INC., as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code and as a debtor company
                        under the CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        POPE & TALBOT LUMBER SALES, INC., as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code and as a debtor company
                        under the CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        MACKENZIE PULP LAND LTD., as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code and as a debtor company
                        under the CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -24-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        P&T LFP INVESTMENT LIMITED PARTNERSHIP, as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        P&T FUNDING LTD.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        as a Debtor and Debtor-in-Possession under the US Bankruptcy
                        Code and as a debtor company under the CCAA, as its General
                        Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        P&T FUNDING LTD., as a Debtor and Debtor-in-Possession
                        under the US Bankruptcy Code and as a debtor company under the
                        CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        P&T FINANCE ONE LIMITED PARTNERSHIP, as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        PENN TIMBER, INC.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        as a Debtor and Debtor-in Possession under the US Bankruptcy
                        Code and as a debtor company under the CCAA, as its General
                        Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -25-

         

        
        

        

        

        

        
            	
                        
                         

                    	
                        
                         

                    	
                        
                        P&T FINANCE TWO LIMITED PARTNERSHIP, as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        PENN TIMBER, INC.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        as a Debtor and Debtor-in-Possession under the US Bankruptcy
                        Code and as a debtor company under the CCAA, as its General
                        Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        P&T FACTORING LIMITED PARTNERSHIP as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        POPE & TALBOT PULP SALES U.S., INC.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        as a Debtor and Debtor-in-Possession under the US Bankruptcy
                        Code and as a debtor company under the CCAA, as its Managing General
                        Partner

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        P&T FINANCE THREE LLC, as a Debtor and
                        Debtor-in-Possession under the US Bankruptcy Code and as a debtor company
                        under the CCAA

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        POPE & TALBOT LTD.,

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        as a Debtor and Debtor-in Possession under the US Bankruptcy
                        Code and as a debtor company under the CCAA, as its Manager

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                        By:

                    	
                        
                        /s/ R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Name:  R. Neil Stuart

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                        Title:  Vice President and Chief Financial
                        Officer

                    
	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    	
                        
                         

                    

        

         

         

        
        -26-Exhibit 4.2

 

Exhibit 4.2

AMENDMENT

September 1992 NOTE AGREEMENT

     Amendment (this “Amendment”), dated as of September 16, 2005, to the Note Agreement,
dated as of September 21, 1992 (the “Existing Agreement”) and, as amended by this Amendment and as
may be further amended from time to time, (the “Agreements”) by and among Piedmont Natural Gas
Company, Inc. (the “Company”) and Provident Life and Accident Insurance Company (“Provident”),
pursuant to which the Company issued its U.S. $35,000,000 aggregate principal amount of 8.51%
Senior Note due September 30, 2017 (the “Note”) to Provident.

     Capitalized terms used herein and not otherwise defined herein shall have the meanings
ascribed to such terms in the Agreements.

RECITALS:

          A. The Company has been and remains in full compliance with the terms and conditions of the
Existing Agreement and the Note and no Default or Event of Default has occurred or is continuing.

          B. The Company is exploring an opportunity in entering into a joint venture thru one
of its Subsidiaries that is a limited liability company.

          C. The Company desires to amend the definition of Subsidiary contained in the Existing
Agreement to include a limited liability company.

          NOW, THEREFORE, in consideration of the premises and other good and valuable
consideration, the receipt and sufficiency of which is hereby acknowledged and agreed, the
parties hereto agree as follows:

SECTION 1. AMENDMENT TO NOTE AGREEMENT

     The existing Agreement shall be and is hereby amended as follows:

     1.1 Section 10. Definitions of the Existing Agreement shall be and the same
is hereby amended by modifying the following definition of Subsidiary contained therein,
and such term shall be and hereby is amended to read in it entirety as follows:

          “Subsidiary” shall mean any corporation or limited liability company at least a
majority of the total combined voting power of all classes of Voting Stock or membership
interest of which shall, at the time as of which any determination is being made, be owned
by the Company either directly or through Subsidiaries.

 

 

SECTION 2. WARRANTIES AND REPRESENTATIONS

          To induce Provident to enter into this Amendment and to consent to the amendment set
forth herein, the Company warrants and represents, on the date of this Amendment, as
follows (it being agreed, however, that nothing in this Section 2 shall affect any of the
warranties and representations previously made by the Company in or pursuant to the
Existing Agreement, and that all of such other warranties and representations, as well as
the warranties and representations in this Section 2, shall survive the effectiveness of
this Amendment and the amendments as set forth herein):

     2.1 Organization; Power and Authority.

     The Company is a public company duly incorporated and validly existing under the laws
of North Carolina and is duly qualified as a corporation and is in good standing in each
other jurisdiction in which such qualifications required by law, other than those
jurisdictions as to which the failure to be so qualified or in good standing would not,
individually or in the aggregate, reasonably be expected to have a material adverse effect.
The Company has the corporate power and authority to own its properties and to conduct its
business and to execute and deliver this Amendment and the Agreements as amended by this
Amendment.

     2.2 Authorization, etc. This Amendment and the Agreements as amended by this Amendment
have been duly authorized by all necessary corporate action on the part of the Company.

SECTION 3. MISCELLANEOUS

     3.1 Except as hereinabove specifically amended, all other provisions of the Existing
Agreement shall remain in full force and effect.

     3.2 THIS AMENDMENT SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, AND THE RIGHTS
OF THE PARTIES SHALL BE GOVERNED BY, THE LAW OF THE STATE OF NORTH CAROLINA.

     3.3 This Amendment and all of the provisions hereof shall be binding upon and inure to
the benefit of the parties hereto and their respective permitted successors and assigns.

     3.4 This Amendment may be executed in one or more counterparts, each of which shall be
deemed an original and all of which taken together shall be deemed to constitute one and
the same instrument, and it shall not be necessary in making proof of this Amendment to
produce or account for more than one of such counterparts.

2

 

     IN WITNESS WHEREOF the parties hereto have executed and delivered this Amendment as of the
date first set forth above.

	 	 	 	 	 	 	 
	 	 	PIEDMONT NATURAL GAS COMPANY, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Robert O. Pritchard
 

	 	 
	 	 	Name: Robert O. Pritchard	 	 
	 	 	Title: Treasurer	 	 
	 
	 	 	 	 	 	 
	 	 	PROVIDENT LIFE AND ACCIDENT

INSURANCE COMPANY

By: Provident Investment Management, LLC

Its: Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ben Vance
 

	 	 
	 	 	Name: Ben Vance	 	 
	 	 	Title: Vice President	 	 

3

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