Valerie has a disturbing dream about Grandmother. She tells Suzette that she fears Grandmother might be in danger and hightails it to her house in the woods, stopping only long enough to pick up Father Solomon's severed hand with the silver fingernails. Along the way, she runs into Peter. When she notices his gloved hand, she suspects that he might be the werewolf and wounds him with her knife. When she reaches Grandmother's house, she finds Grandmother in her bedroom with the curtains drawn. Grandmother says that she just woke up and invites Valerie to eat some stew while she waits. When Valerie takes a bite, Grandmother steps out of the bedroom, revealing "herself" to be Valerie's father Cesaire. He explains that he killed Lucie when he realized she wasn't his daughter (or she would have understood wolf talk), wounded Suzette for being unfaithful, and killed her lover Adrien Lazar (Michael Shanks). Furthermore, he had to kill Grandmother because she finally figured out that he was the werewolf. Peter suddenly bursts in the door and tries to rescue Valerie, but Cesaire bats him across the room. Valerie invites her father to look into her basket. When he comes near, she pulls out Father Solomon's hand and stabs him with the silver fingernails. Peter then realizes that he's been bitten by Cesaire. To hide the fact that Cesaire was the werewolf, they cut him open, fill him with rocks, and dump him in a river. Knowing that he will become a werewolf, Peter goes off into the woods, vowing to come back when he learns how to control himself so that he won't hurt Valerie. Valerie promises to wait for him and moves into her Grandmother's house. In the final scene, several months later, Valerie hears someone calling to her in wolfspeak and smiles, knowing that Peter is back.