FIFTH AMENDMENT TO DEBTOR-IN-POSSESSION CREDIT AND SECURITY AGREEMENT

Exhibit 4.3

Execution Copy

FIFTH AMENDMENT TO DEBTOR-IN-POSSESSION CREDIT AND SECURITY AGREEMENT

FIFTH AMENDMENT, dated as of April 25, 2008 (this “Amendment”), to the Debtor-in-Possession Credit and Security Agreement, dated as of November 19, 2007, as amended by the First Amendment and Waiver to Debtor-In-Possession Credit and Security Agreement, dated as of December 20, 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, the Revolving Loan Commitment (as defined in the Credit Agreement) and the Term Loan B Commitment (as defined in the Credit Agreement) are due to terminate and the Obligations (as defined in the Credit Agreement) are due to be repaid in full on April 25, 2008;

WHEREAS, 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, including without limitation, the extension of the Final Maturity Date (as defined in the Credit Agreement); 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 as follows:

(a) The definition of the term “Final Maturity Date” is hereby amended and restated in its entirety to read as follows:

“‘Final Maturity Date’: the date which is the earliest of (i) May 5, 2008, (ii) the date of both (A) the earlier of the effective date and the substantial consummation (as defined in Section 1101(2) of the US Bankruptcy Code), in each case, of a plan of reorganization in the Chapter 11 Cases that shall have been confirmed by an order entered by the US Bankruptcy Court and (B) the earlier of the effective date and the substantial implementation, in each case, of a plan of compromise or arrangement in the CCAA Proceedings that shall have been sanctioned by an order entered by the Canadian Bankruptcy Court, (iii) the date upon which the Stay of Proceedings expires, (iv) the date of the closing of a sale of all or substantially all of the Loan Parties’ assets (which shall include a sale of both the lumber and pulp divisions of the Loan Parties) pursuant to Section 363 of the US Bankruptcy Code and the CCAA, and (v) such earlier date on which all Loans and other extensions of credit shall become due and payable in accordance with the terms of this Agreement and the other Loan Documents.”;

(b) The definition of the term “Initial Budget” is hereby amended and restated in its entirety to read as follows:

“‘Initial Budget’: the cash requirement forecast setting forth cash collections and disbursements of the Loan Parties for the periods covered thereby (which forecast shall include a calculation of Availability during such period, identify the amount of financing that will be required each day of such period and identify, on a schedule thereto, the professionals and the projected professional fees and disbursements expected to be paid to such professionals as Administration Charge Expenses and US Carve-Out Expenses during such period) prepared on a daily basis by or on behalf of the Borrower and delivered by the Borrower to the Agents and the Lenders on or before the Fifth Amendment Effective Date pursuant to Section 5 of the Fifth Amendment, a summary of which is attached to the Fifth Amendment as Schedule I-1A (which such forecast shall update and extend the forecast previously delivered on or prior to the Interim Facility Effective Date pursuant to Section 5.1(v) hereto), together with and as superseded and replaced by the Updated Budget that is required to be delivered by the Borrower to the Agents and the Lenders, in accordance with Section 6.2(g).”; and

(c) The definition of the term “Revolving Credit Commitment Period” is hereby amended and restated in its entirety to read as follows:

“‘Revolving Credit Commitment Period’: the period from and including the Interim Facility Effective Date to the last Business Day immediately preceding the Final Maturity Date.”

-2-

(d) The following new definitions are hereby inserted into Section 1.1 of the Credit Agreement in the appropriate alphabetical order, to read as follows:

“Fifth Amendment”: that certain Fifth Amendment to Debtor-In-Possession Credit and Security Agreement, dated as of April 25, 2008, among the Parent, the Borrower, the Lenders and the Agents and as acknowledged and agreed by the Guarantors.

“Fifth Amendment Effective Date”: as defined in the Fifth Amendment.

“Interfor Rights of Access”: the Profits À Prendre, Shelter Bay Covenant, Timber Rights of First Refusal and Lot 30 Profit À Prendre, each as defined in Section 5.24 of the Lumber APA, as amended by the Amending Agreement to Asset Purchase Agreement, dated as of April 24, 2008, among the Parent, Borrower, Pope & Talbot Lumber Sales, Inc., Pope & Talbot Spearfish Limited Partnership, and International Forest Products Limited, a British Columbia corporation.

3. Borrowing Base Certificate. Section 6.11 of the Credit Agreement is hereby amended and restated in its entirety to read as follows:

“Borrowing Base Certificate. In the case of the Borrower, deliver or cause to be delivered to the Administrative Agent and Collateral Agent, at the Borrower’s expense, the Borrowing Base Certificate on a daily basis (commencing on April 25, 2008) supported by schedules showing the derivation thereof and containing such detail and other information as any Agent may reasonably request from time to time, provided, that (i) the Borrowing Base set forth in the Borrowing Base Certificate shall be effective from and including the date such Borrowing Base Certificate is duly received by the Agents to but not including the date on which a subsequent Borrowing Base Certificate is received by the Agents, unless any Agent disputes the eligibility of any property included in the calculation of the Borrowing Base or the valuation thereof by notice of such dispute to the Borrower and (ii) in the event of any dispute about the eligibility of any property included in the calculation of the Borrowing Base or the valuation thereof, such Agent’s Permitted Discretion shall control. The Borrower shall also deliver to the Administrative Agent and Collateral Agent such other reports, statements and reconciliations with respect to the Borrowing Base or the Collateral as either of them shall from time to time request in its reasonable discretion.”

4. Limitation on Liens. Section 7.3 of the Credit Agreement is hereby amended to (a) delete the word “and” at the end of subsection (q) thereof; (b) delete the period at the end of subsection (r) thereof and add in its place a semi-colon and the word “and”; and (c) add a new subsection (s) to read as follows:

“(s) Interfor Rights of Access.”

-3-

5. Conditions. This Amendment shall become effective as of the date hereof, 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 “Fifth Amendment Effective Date”):

(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 Fifth Amendment Effective Date shall be true and correct on and as of the Fifth 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 Fifth Amendment Effective Date or would result from this Amendment becoming effective in accordance with its terms.

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

(i) counterparts of this Amendment which bear the signatures of the Parent, the Borrower, the Guarantors, the Agents and the Lenders;

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

(iii) a copy of the Initial Budget which updates and extends the cash requirement forecast delivered on or prior to the Interim Facility Effective Date in accordance with Section 5.1(v) of the Credit Agreement, together with a certificate of a duly authorized officer of the Borrower stating that such Initial Budget has been prepared on a reasonable basis and in good faith and is based on assumptions believed by the Borrower to be reasonable at the time made and is consistent with all information then reasonably available to the Borrower,

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

6. 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.

-4-

(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 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 or any Bankruptcy Court 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, except to the extent any such authorization, approval, action, notice or filing has been obtained, taken, given or filed (as the case maybe) and is in full force and effect.

(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 Fifth 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 Fifth Amendment Effective Date or would result from this Amendment becoming effective in accordance with its terms.

7. Use of Loan Proceeds and other Advances. Notwithstanding any other provision to the contrary contained in the Credit Agreement (including, without limitation, Sections 2.5, 4.17, 5.03 and 6.12 of the Credit Agreement) or any other Loan Document, the Borrower shall be permitted to borrow and the Agents shall be permitted to make Loans and other advances (in their discretion) in excess of the Borrowing Base in order to fund expenditures, disbursements and payments that are consistent with the relevant expenditure line items in the Initial Budget and the use of any proceeds of any Loans or other advances shall also be subject to the approval of the chief restructuring officer of the Parent.

-5-

8. 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 Fifth 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 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.

9. 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 (including, without limitation, with respect to the use of proceeds of Loans and other advances, Section 7 hereof).

10. 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.

-6-

(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 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.

SCHEDULE 1.1A

INITIAL BUDGET

Pope & Talbot Weekly Cash Forecast

Forecast - All Sites Consolidated

(USD $000’s)

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 Fifth 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 April 25, 2008

[signature pages follow]