AGREEMENT


     THIS AGREEMENT is entered into as of the 23rd day of November, 1992, by and
between BOISE CASCADE CORPORATION, a Delaware corporation (hereinafter called
"Boise Cascade") and AMERICAN TISSUE MILLS OF OREGON, INC., a New York
corporation (hereinafter called "American Tissue");

     In consideration of the covenants and agreements made herein by the
parties, and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the parties hereby agree as follows:

     1. Definitions.

     (a) "Accounting Code" means the Costing/Billing Method at the St. Helens
Paper Mill attached hereto as Exhibit C.

     (b) "Boise Cascade" means Boise Cascade Corporation, a Delaware
corporation.

     (c) "Direct Costs" are those costs so-defined in the Accounting Code.

     (d) "Exhibits" are those exhibits attached hereto and are incorporated
herein by reference as though fully set forth in the body of this Agreement.

     (e) "Excluded Costs" are those costs so-defined in the Accounting Code.

     (f) "Indirect Costs" are those costs so-defined in the Accounting Code.

     (g) "Mill" means the St. Helens, Oregon, pulp and paper mill premises owned
and operated by Boise Cascade as more fully described in Exhibit B. Boise
Cascade represents that the


<PAGE>




description set forth in Exhibit B is true, accurate, and complete.

     (h) "American Tissue" means American Tissue Mills of Oregon, Inc., a New
York corporation.

     (i) "Paper Machine" means the No. 3 Tissue Paper Machine located at the No.
3 Paper Machine Building at the Mill ("No. 3 Paper Machine Building"), as more
fully set forth on Exhibit A, but specifically excludes the Real Property. The
Paper Machine does not include any part of the foundation; i.e., the support
which lies below the sole plate of the machine. The Paper Machine shall be
deemed to be personal property.

     (j) "Real Property" means the No. 3 Paper Machine Building and the land
lying directly underneath same, as more fully described on Exhibit B-l, and
fixtures, facilities and appurtenances within the No. 3 Paper Machine Building,
but specifically excluding the Paper Machine.

     (k) "Ton" is 2,000 pounds.

     (1) "Capital Costs" are those costs defined in the Accounting Code as
capital improvements or capital repairs.

     2. Purchase of Paper Machine. Boise Cascade hereby sells to American Tissue
and American Tissue hereby purchases from Boise Cascade the Paper Machine for
the purchase price of $5,000,000.00, payable as follows:

     (a)  $833,333.00 upon execution of this agreement;

     (b)  $166,667.00 by American Tissue's assumption of Boise Cascade's
          obligation to Koplik Paper Associates ("Koplik") pursuant to a certain
          agreement between



                                      -2-
<PAGE>


          Boise Cascade and Koplik dated October 20, 1992, a copy of which is
          annexed hereto as Exhibit H; and

     (c)  $4,000,000.00 pursuant to the terms of a certain Promissory Note in
          the form annexed hereto as Exhibit I executed by American Tissue in
          favor of Boise Cascade simultaneously with the execution of this
          Agreement.

Simultaneously with the execution hereof, Boise Cascade shall duly execute and
deliver to American Tissue an agreement to sell property in respect of the Paper
Machine in the form annexed hereto as Exhibit J. Except as otherwise provided
herein, American Tissue may remove the Paper Machine from the Mill. The Paper
Machine shall not be removed during the term of this Agreement, except that
component parts may be removed only for refurbishing or for the purpose of being
replaced by new components. Boise Cascade shall provide access to American
Tissue's title company representatives to survey the Real Property and/or the
Warehouse Lease Site at American Tissue's expense. Such access shall be given
upon 24 hours' advance notice.

     3. Warranty. Boise Cascade warrants that it is the sole owner and has good
and marketable title to the Paper Machine, free and clear of any and all liens,
restrictions, reservations, security interests (except the security interest
created pursuant to Section 4 hereof), conditional sales agreements, leases,
claims and encumbrances of any nature whatsoever. Except for Boise Cascade's
representations set forth in Section 10 of this Agreement, the Paper Machine is
sold "AS IS, WHERE IS." THE WARRANTIES SET FORTH IN THIS SECTION 3 ARE EXCLUSIVE
AND IN LIEU


                                      -3-
<PAGE>


OF ALL OTHER WARRANTIES RELATING TO THE PHYSICAL CONDITION OF THE PAPER MACHINE,
EXPRESS OR IMPLIED BY LAW OR TRADE USAGE, INCLUDING ANY IMPLIED WARRANTIES OF
MERCHANTABILITY OR FITNESS FOR A PARTICULAR PURPOSE. BOISE CASCADE SHALL NOT BE
LIABLE FOR ANY INCIDENTAL OR CONSEQUENTIAL DAMAGES, IF ANY, INCLUDING BUT NOT
LIMITED TO LOSS OF USE OR LOSS OF ANTICIPATED PROFITS, WHETHER ARISING IN
CONTRACT, TORT, PRODUCT LIABILITY, OR OTHERWISE, ARISING OUT OF BREACH OF ANY
WARRANTY RELATING TO THE PHYSICAL CONDITION OF THE PAPER MACHINE.

     4. Security Interest. To secure the timely payment and performance of the
Obligations (as defined below), American Tissue does hereby grant a purchase
money (to the fullest extent permitted by applicable law) security interest in
favor of Boise Cascade in and to all the estate, right, title, and interest of
American Tissue, whether now or later acquired, in and under the Paper Machine
(including all future improvements and additions and replacements thereto), and
all leasehold improvements hereafter made by American Tissue at the No. 3 Paper
Machine Building (collectively, the "Collateral"). American Tissue shall also
execute, deliver, and record a deed of trust, the form of which is attached as
Exhibit R. The "Obligations" means all obligations of American Tissue now
existing or hereafter arising under this Agreement, including but not limited to
the Promissory Note annexed as Exhibit I and the obligation of American Tissue
to make all payments and perform all obligations pursuant to the provisions of
this Agreement and to transfer title to the Paper Machine to Boise Cascade under
certain circumstances in accordance with the provisions of this Agreement. If
American


                                      -4-
<PAGE>

Tissue is in default under the provisions of this Agreement after notice and the
expiration of any grace or cure periods provided for in this Agreement, then
upon not less than ten (10) days' notice to American Tissue, Boise Cascade may
exercise all the applicable rights and remedies granted to a secured party by
applicable law, including but not limited to the Uniform Commercial Code of the
state of Oregon. American Tissue represents, warrants, and covenants that the
security interest created hereby is prior to any other security interest or lien
created or suffered by American Tissue in the Collateral. American Tissue agrees
that from time to time, at the expense of American Tissue, American Tissue will
promptly execute and deliver all further instruments and documents and take all
further action that may be reasonably necessary or that Boise Cascade may
reasonably request in order to perfect and evidence the security interest
granted pursuant to this section, including the execution and filing of such
financing or continuation statements or amendments thereto as may be reasonably
necessary. The security interest shall remain in full force and effect until
payment in full of the Obligations and shall be binding upon American Tissue,
its successors and assigns, and shall inure to the benefit of Boise Cascade and
its successors and assigns. Notwithstanding the foregoing or anything else to
the contrary set forth in this Agreement, the security interest in favor of
Boise Cascade created pursuant to this Agreement shall be and shall be deemed to
be subordinate to the lien(s) and/or security interest(s) hereafter granted by
American Tissue to one or more third parties unrelated to American Tissue in
connection with the


                                      -5-
<PAGE>

financing of the Paper Machine and all improvements, additions and replacements
hereafter made to the Paper Machine, provided, however, no such subordination
shall be effective unless substantially all of the net proceeds of such
financing (whether by way of a direct loan to American Tissue or a guarantee by
American Tissue of such financing from an unrelated third party) are applied
first in full or partial payment or prepayment of the promissory note from
American Tissue to Boise Cascade in the principal amount of $4,000,000.00 of
even date herewith referred to in Section 2 of this Agreement; provided further,
the maximum aggregate principal amount of all such financing to which Boise
Cascade's lien and security interest shall be subordinate ("Maximum Subordinated
Debt") with respect to the Paper Machine (in its current condition) shall equal
(i) $4,000,000.00 and (ii) the total accumulated costs of all those
improvements, additions and replacements made to the Paper Machine which are
capitalized pursuant to the capitalization and depreciation policies set forth
in Exhibit K during the three-year period commencing on the date of this
Agreement, without any deduction for depreciation. Such subordination shall be
automatic and no further instrument of subordination or other documentation
shall be required to effectuate or evidence such subordination. However, upon
the request of American Tissue or any third party(ies) providing any such
financing, Boise Cascade agrees from time to time, at the expense of Boise
Cascade, to promptly execute and deliver to American Tissue or any such third
party(ies) all further documents or instruments and take all further action
that may be reasonably necessary or that American


                                      -6-
<PAGE>


Tissue may reasonably request to effectuate and/or evidence such subordination,
including the execution and filing of such documents as may be reasonably
necessary.

     5. Lease. (a) Boise Cascade hereby leases the Real Property to American
Tissue for the term hereof and subject to the terms and conditions hereinafter
set forth. American Tissue shall obtain Boise Cascade's prior written consent
for any leasehold improvements or any improvements to loading docks which may be
utilized by American Tissue. Boise Cascade shall not unreasonably withhold or
delay such consent. Title to leasehold improvements to the Real Property shall
pass to Boise Cascade, without any payment owed to American Tissue, upon
termination of this Agreement. American Tissue shall have no title to any
improvements to the loading dock.

     (b) American Tissue shall have the exclusive use of the second floor of the
No. 3 Paper Machine Building and shall have the non-exclusive use of all other
portions of the Real Property. Boise Cascade shall have access rights to the
second floor for Mill related purposes, but such access shall not unreasonably
interfere with American Tissue's use of the Paper Machine. American Tissue shall
have access rights to the Real Property, subject to Boise Cascade's Mill access
guidelines. Boise Cascade represents that such guidelines will not unreasonably
interfere with American Tissue's access to the Real Property or the use of the
common areas at the Mill.

     (c) Boise Cascade shall maintain in good working order and repair the
exterior, public and structural portions of the Real Property and all systems,
facilities and installations


                                      -7-
<PAGE>

relating thereto, including, without limitation, the plumbing, electrical,
heating, ventilating and air conditioning systems serving the Real Property,
with payment of the costs and expenses for such maintenance and repair to be in
accordance with Section 7 of this Agreement. Anything herein to the contrary
notwithstanding, any expenditure relating to first floor of the Real Property
which does not directly and exclusively benefit American Tissue shall be
appropriately apportioned between the parties.

     (d) Boise Cascade hereby covenants, warrants and represents as follows: (i)
Boise Cascade has not received any notice of any claim, suit or other action or
investigation with respect to the violation of any Federal, state or local
environmental laws rules or regulations or OSHA regulations (or the state
equivalent thereof) due to the presence of hazardous materials on the Real
Property that remain unresolved or are pending; (ii) Boise Cascade is the
beneficial and record owner of the Real Property in fee absolute, and there are
no mortgages, liens, encumbrances, charges, tenancies, licenses, covenants,
conditions, restrictions, rights-of-way, easements, encroachments or other
restrictions of any nature or character whatsoever that unreasonably restrict or
prevent American Tissue's use of the Real Property; and (iii) Boise Cascade has
the full right and authority to lease the Real Property to American Tissue and
American Tissue may peaceably and quietly enjoy the Real Property. Boise Cascade
shall warrant and defend American Tissue's quiet enjoyment of the Real Property.
The foregoing


                                      -8-
<PAGE>

representations shall survive the expiration or earlier termination of this
Agreement;

     (e) Except with respect to hazardous waste placed on the Real Property by
American Tissue or its agents, employees and invitees (including contractors
hired by American Tissue), Boise Cascade shall be fully and solely responsible,
at Boise Cascade's sole and exclusive cost and expense, for any and all
maintenance, repairs or improvements, structural or otherwise, required due to
the presence of hazardous materials improperly deposited on the Real Property
and/or hazardous waste and any other preexisting conditions, normal wear and
tear excepted (i.e., the cost of repairing any part of the Real Property that
breaks or fails after the date hereof shall be a Direct Cost, but the cost of
repairing, replacing, or restoring any item damaged, broken, or currently
inoperative or defective shall be an Excluded Cost) in or upon any portion of
the Real Property and shall promptly perform any and all work relating to the
presence of such hazardous materials and any other preexisting conditions in
compliance with all applicable Federal, state and local rules and regulations.
None of such costs or expenses shall be borne by or passed along to American
Tissue, directly or indirectly;

     (f) Simultaneously with the execution hereof, Boise Cascade and American
Tissue shall execute a Memorandum of Lease for recording, substantially in the
form annexed hereto as Exhibit M.

     6. Operation of the Paper Machine. Boise Cascade shall, for the period
commencing on the date hereof and ending December 31, 2012:


                                      -9-
<PAGE>

     (a) Operate, service, and maintain the Paper Machine as directed by
American Tissue and handle, store and ship the finished paper from the Paper
Machine in such manner as American Tissue may direct, including the furnishing
of all labor, materials, parts, supplies, and sundries as may be reasonably
necessary or as American Tissue may so reasonably direct, all consistent with
Boise Cascade's historical practices. Boise Cascade shall use commercially
reasonable efforts to operate the Paper Machine efficiently and at a cost level
consistent with prior management practices at the Mill. Both parties recognize
that machine malfunction and down-time is a common occurrence associated with
the operation of the Paper Machine and such malfunctions and down-time shall not
be considered a breach or default under this Agreement, including where caused
by employee error, provided, however, that Boise Cascade generally manages and
supervises the operation and maintenance of the Paper Machine with the same
general level of care and supervision as with the other paper machines at the
Mill. The Paper Machine and the Real Property shall be maintained and operated
by Boise Cascade at American Tissue's expense as herein set forth in as good a
state of repair as the same now are and shall be maintained and repaired in
compliance with all federal, state, and local laws, rules, and regulations as
are now in force or as hereafter may be in force and in accordance with Boise
Cascade's safety standards and agreements applicable to the Mill. Both parties
shall use commercially reasonable efforts to reduce costs to be incurred by
American Tissue hereunder. Boise Cascade has obtained and shall maintain in full
force and effect continuously throughout the


                                      -10-
<PAGE>

term of this Agreement, all permits, licenses, certificates and other
authorizations which are required with respect to the operation of the Paper
Machine and the Mill under and pursuant to all applicable laws, rules and
regulations except for general corporate business licenses that American Tissue
must obtain in its own name. Boise Cascade shall provide adequate manpower
levels for manning the operation of the Paper Machine at full capacity and in
accordance with any applicable labor agreements. Full capacity shall include any
increase in productive capacity as a result of capital improvements, operating
efficiencies and/or grade mix efficiencies.

     (b) Without having to modify the current configuration of the Real Property
or any other property in any material respect, provide and maintain the Real
Property, including all structural facilities used in conjunction with the Paper
Machine (but excluding only the portions used for the roll grinder and slitter
grinder located in the No. 3 Paper Machine Building) and all services therein in
good condition so as to assure the continued operation of the Paper Machine in
accordance with this Agreement and, in addition, provide the necessary
equipment, facilities, and labor for transporting finished paper to the truck
facilities used in shipping finished paper from the Mill;

     (c) Without having to modify the current configuration of the Real Property
or any other property in any material respect, provide to American Tissue in
connection with its operation of the Paper Machine, the use of such truck
facilities as may from time to time be necessary. If in the ordinary of business
Boise Cascade shall be unable to ship the finished


                                      -11-
<PAGE>

paper from the Mill as American Tissue may direct or if American Tissue shall
decide to store any finished paper, Boise Cascade shall furnish storage
facilities, as set forth on Exhibit D, the location of which may be changed by
Boise Cascade from time to time; provided, however, that any alternate storage
facilities shall be comparable in size and accessibility to the storage
facilities described on Exhibit D and shall not be located so as to be
unreasonably inconvenient to American Tissue. Boise Cascade shall bear all of
the costs involved in relocating any material required to be moved to alternate
storage facilities as may be designated by Boise Cascade pursuant hereto. Boise
Cascade has no obligation to furnish storage facilities in excess of those
described on Exhibit D.

     (d) Furnish to American Tissue from the pulp facilities at the Mill for use
in the Paper Machine, pulp in such quantities, types, and qualities as set forth
on Exhibit E and pursuant to all the terms and conditions of this Agreement and
Exhibit E. American Tissue shall have the right, at its own expense, to install
any necessary capital equipment solely in the Real Property to utilize secondary
fiber in addition to the minimum volume obligations on Exhibit E. American
Tissue shall have the right to provide its own pulp from outside sources from
time to time in addition to the pulp being furnished by Boise Cascade to
American Tissue pursuant to this Agreement. Use of fiber from third parties
shall not reduce American Tissue's or Boise Cascade's obligations under Exhibit
E.

     (e) American Tissue shall be excused from the Exhibit E pulp purchase
requirements for any calendar year during



                                      -12-
<PAGE>

the term of this Agreement to the extent that Boise Cascade is unable to produce
at least 35,000 tons per year from the Paper Machine as directed by American
Tissue, provided that American Tissue shall complete the capital improvement
items listed in Exhibit N in the time frame set forth in Section 9 of this
Agreement, American Tissue has consented to or approved all of Boise Cascade's
reasonable recommended maintenance and capital repair items in respect of the
Paper Machine, and American Tissue's designated mix of products produced by the
Paper Machine is generally consistent with the current mix of products produced
by the Paper Machine for the months of January 1992 and March 1992 as set forth
in Exhibit P; if so, Boise Cascade shall also give American Tissue a year-end
credit with respect to each such calendar year that Boise Cascade is unable to
produce at least 35,000 tons of tissue paper in accordance with the following
formula:


            35,000 - (S+D)
          -------------------  x C = Year End Credit
                 35,000

         Where:          S           =    Tons of tissue paper produced in the
                                          Calendar Year.

                         D           =    Lost tons due to market related
                                          downtime requested by American Tissue
                                          or capital repair or improvement
                                          down-time requested by American Tissue
                                          plus any tons that are not produced as
                                          a result of an event of force majeure,
                                          calculated based on 96 tons per day.

                         C           =    Indirect Costs plus Direct Costs
                                          excluding the following items: steam,
                                          power, fuel, dyes and chemicals.


     Without in any way limiting Boise Cascade's obligations as set forth in
this Agreement, the failure of Boise Cascade to


                                      -13-
<PAGE>

produce 35,000 tons in any calendar year shall not be considered a default
hereunder. Because the Agreement does not begin on January 1, there shall be a
modification of the calculation for the period beginning on the date of this
Agreement and ending December 31, 1993, as follows: The same formula as above
shall be utilized, except the numbers will be appropriately adjusted to reflect
the longer period of time (i.e., the 35,000 figure in the numerator and the
denominator shall be increased by a fraction: number of days from the date of
this Agreement to December 31, 1993, divided by 365).

     7. Payment for Pulp and Services. For the services, facilities, and pulp
furnished by Boise Cascade in accordance with this Agreement, American Tissue
shall make payments to Boise Cascade as follows:

     (a) All Direct Costs attributable to the operation, servicing, and
maintenance of the Paper Machine and the Real Property;

     (b) For pulp, American Tissue shall pay Boise Cascade an amount for each
ton furnished in accordance with Exhibit E;

     (c) Capital Costs with respect to the Paper Machine and Real Property and
Indirect Costs, as set forth on Exhibit C.

     (d) All records of costs shall be kept in accordance with the Accounting
Code, and together with all related documentation shall be made available to
American Tissue upon request for review and audit pursuant to the provisions of
Section 19 hereof and determinations as to which are Direct Costs, Indirect
Costs, Excluded Costs, and Capital Costs shall be consistent with the Accounting
Code;


                                      -14-
<PAGE>

     (e) Direct Costs and Capital Costs shall be paid on or before the last day
of each calendar month against the invoice for the immediately preceding
calendar month, which invoice shall be received by American Tissue no later than
the tenth day of the month payment is due. Interest on the Direct Costs and the
amount due for pulp (Exhibit E) shall accrue beginning on the 16th day of the
month in which payment is due and continue until the amount due is paid.
Interest shall be calculated at the prime rate on the 15th of each calendar
month (or for the previous banking day if the 15th falls on a non-banking day)
plus 1%. The prime rate shall be "the base rate on corporate loans as posted by
at least 75% of the nation's 30 largest banks" as quoted by the edition of the
Wall Street Journal published on the 16th day of each calendar month (or on the
next day the Wall Street Journal shall be published).

     Indirect costs shall be reasonably estimated for each calendar month and
payable on the 15th day of the calendar month in which they are actually
incurred. The estimate shall be adjusted and American Tissue shall pay, or be
credited, as the case may be, on the 15th day of the following calendar month,
to cause the amount paid to reflect the actual Indirect Costs for the preceding
month.

     8. Mill Rules and Other Agreements. To the extent that American Tissue's
employees or contractors are at the Mill, they shall comply with all Mill rules,
standards, and guidelines, and all applicable laws, rules, and regulations, and
will take no action inconsistent with any contracts or agreements to which Boise
Cascade is a party, including but not limited to the labor



                                      -15-
<PAGE>

agreement. Simultaneously with the execution hereof, Boise Cascade and American
Tissue shall execute an Assignment and Assumption Agreement in the form annexed
hereto as Exhibit Q.

     9. Improvements to and Maintenance of the Paper Machine. American Tissue
may from time to time, at its sole cost and expense, improve or upgrade the
Paper Machine so as to enhance the production capabilities of the Paper Machine
and/or the quality or types of products produced by the Paper Machine. American
Tissue shall have the right to refuse approval of any suggested capital repair
or capital improvement not necessary for safe operation (in accordance with
Boise Cascade's Mill standards) or obligatory pollution control. Notwithstanding
anything to the contrary in this Agreement, American Tissue shall cause at
American Tissue's sole cost and expense, the required capital improvements set
forth on Exhibit N to be installed prior to December 31, 1995. All repairs,
maintenance, and improvements shall be scheduled so as to minimize disruption to
Boise Cascade's operations to the extent reasonably practicable. At American
Tissue's request, and to the extent reasonably and commercially practicable,
American Tissue shall have the right to approve, in advance, any extraordinary
repairs or maintenance which Boise Cascade intends to perform with regard to the
Paper Machine. Boise Cascade has the right to make all repairs as herein set
forth necessary for the Paper Machine to comply with its safety and
environmental standards described in Section 6 hereof. Boise Cascade shall
charge American Tissue its actual costs incurred in making or performing all
such maintenance, repairs and improvements, without the addition of any
"mark-up,"


                                      -16-
<PAGE>

all in accordance with the Accounting Code. American Tissue shall not create or
suffer any liens or encumbrances against Boise Cascade's property, including the
Real Property.

     10. Representations and Warranties of Boise Cascade. Boise Cascade
represents and warrants to American Tissue that:

     (a) Boise Cascade is a corporation duly organized and validly existing
under the laws of the state of Delaware, has the corporate power and authority
to own, operate, and carry on the business of the Mill as contemplated by this
Agreement and is duly qualified and in good standing in the state of Oregon;

     (b) Boise Cascade has obtained all necessary authorizations and approvals
from its Board of Directors required for the execution, delivery and performance
of this Agreement. Boise Cascade has the corporate power to execute and deliver
this Agreement and consummate such transactions contemplated hereby; such
execution and delivery does not, and such consummation will not, violate any
provision of Boise Cascade's Certificate of Incorporation or Bylaws or of any
mortgage, indenture, agreement, instrument, order, or decree to which Boise
Cascade is a party or by which it is bound and to the best of its knowledge will
not violate any law, governmental regulations, or restriction of any kind; and
the officers of Boise Cascade are duly authorized to execute this Agreement;

     (c) Boise Cascade has no contractual or other obligations of any kind
outstanding which would be violated by or result in the imposition of a lien on
the Paper Machine or the Real Property by reason of the execution or performance
of this Agreement by Boise Cascade;


                                      -17-
<PAGE>

     (d) No consent, approval or authorization of, or registration,
qualification or filing with, any court, governmental agency or authority or any
other third party is required for the execution, delivery and performance of
this Agreement by Boise Cascade;

     (e) No claims, actions, suits, proceedings or investigations exist relating
to or affecting this Agreement which, if adversely determined, would materially
adversely affect American Tissue's rights and remedies under this Agreement in
any material respect, nor does Boise Cascade know of any such threatened claims,
actions, suits, proceedings or investigations;

     (f) No representation or warranty of Boise Cascade contained herein, or any
of the historical data in Exhibit 2B which is attached to Exhibit C, contains
any untrue statement of a material fact or omits to state a material fact
necessary to make the statements contained herein, or therein, not misleading;

     (g) The financial projections set forth in Exhibit S, previously delivered
to American Tissue, have been made by Boise Cascade in good faith and are based
upon all existing agreements and obligations with respect to the Mill (inclusive
of the pulp mill). The projections are not predictions. All of Boise Cascade's
material contracts that affect Direct Costs are set forth on Exhibit L and have
not been amended or modified except as set forth in Exhibit L. To the best of
Boise Cascade's knowledge, there are no existing agreements or obligations that
will materially increase Indirect Costs, taken as a whole, inconsistent with
historical data set forth in Exhibit 2B which is attached to Exhibit C. To the
best of Boise Cascade's


                                      -18-
<PAGE>

knowledge and belief, no material defaults exist in any such agreements or
obligations.

     (h) Boise Cascade has the unrestricted right to sell the Paper Machine to
American Tissue pursuant to the terms and conditions of this Agreement.

     11. Representations and Warranties of American Tissue. American Tissue
represents and warrants to Boise Cascade that:

     (a) American Tissue is a corporation duly organized and validly existing
under the laws of the state of New York, has the corporate power and authority
to own, operate, and carry on the business as contemplated by this Agreement and
shall promptly take such actions so as to become duly qualified and in good
standing in the state of Oregon;

     (b) Execution and delivery of this Agreement and consummation of the
transactions contemplated hereby have been duly authorized by the Board of
Directors of American Tissue and American Tissue has the corporate power and
authority to execute and deliver this Agreement and consummate such
transactions; such execution and delivery does not, and such consummation will
not, violate any provision of American Tissue's Certificate of Incorporation or
Bylaws or of any mortgage indenture, agreement, instrument, order, or decree to
which American Tissue is a party or by which it is bound and to the best of its
knowledge will not violate any law, governmental regulation, or restriction of
any kind;

     (c) No consent, approval or authorization of, registration, qualification
or filing with, any court, governmental agency or authority or any other third
party is


                                      -19-
<PAGE>

required for the execution, delivery and performance of this Agreement by
American Tissue;

     (d) No claims, actions, suits, proceedings or investigations are pending or
threatened against American Tissue relating to or affecting this Agreement
which, if adversely determined, would adversely affect Boise Cascade's rights
and remedies under this Agreement in any material respect, nor does American
Tissue know of any grounds for any such claims, actions, suits, proceedings or
investigations;

     (e) No representation or warranty of American Tissue contained herein
contains any untrue statement of a material fact or omits to state a material
fact necessary to make the statements contained herein, or therein, not
misleading.

     12. Brokers or Finders. To the best of each party's knowledge and belief,
neither American Tissue nor Boise Cascade has paid nor shall be required nor
requested to pay, directly or indirectly, any finder's or brokerage fee in
connection with the transaction contemplated hereby, except Koplik Paper
Associates, whose fee shall be paid solely by American Tissue (who agrees to pay
Boise Cascade's portion of the amount due as a credit against the purchase
price) in accordance with the letter agreement between the parties dated October
21, 1992, as modified by Exhibit 0.

     13. Force Majeure and Labor Disturbances. If, by reason of fire, accident,
explosion, or strike, or if by reason of an event beyond Boise Cascade's and
American Tissue's control, such as a flood, freeze, drought, epidemic, embargo,
an inadequate supply of facilities or labor, power, fuel or any other material,
war,


                                      -20-
<PAGE>

riot, acts of God or the public enemy, or a law, rule or regulation prohibiting
Boise Cascade or American Tissue from fully or partially complying with its
respective obligations hereunder (collectively, "force majeure,") Boise Cascade
shall be unable to deliver or provide or American Tissue shall be unable to
receive or use any portion of the pulp or of the services contracted for in this
Agreement, such portion of the pulp or services to be delivered or provided
hereunder during the period of any such disability shall be deemed eliminated
from this Agreement and the amounts payable by American Tissue pursuant to this
Agreement for such pulp or services during the period of any such disability
shall be eliminated in the case of total disability or reduced proportionately
in the case of partial disability, provided that during the period of such total
or partial disability, American Tissue shall pay to Boise Cascade the continuing
Direct Costs and Indirect Costs which are applicable.

     Following the occurrence of any disability as aforesaid, which involves
damage or destruction to property, the party whose ability to perform hereunder
shall have been curtailed will immediately undertake and prosecute diligently to
repair and restore the property damaged or destroyed to a condition
substantially equivalent to its condition prior to such damage or destruction.

     Boise Cascade and American Tissue shall provide and maintain the insurance
policies required by Exhibit F.

     Any strike, lockout, or other labor disturbance shall be deemed an event of
force majeure. Boise Cascade shall have no


                                      -21-
<PAGE>

obligation to American Tissue to operate the Mill during any period of strike or
lockout even though it may be within Boise Cascade's power to do so.

     If Boise Cascade operates the Mill or any part thereof during any event of
force majeure, Boise Cascade shall operate the Paper Machine and supply pulp
therefore at the same relative rate of capacity as Boise Cascade operates the
other paper machines then owned by Boise Cascade at the Mill, provided that no
pulp produced by the Mill will be shipped to Vancouver, Washington, or elsewhere
until the pulp requirements of American Tissue are satisfied.

     An event of force majeure shall include excessive governmental laws and
regulations enacted, promulgated, or issued after the date of this Agreement.
"Excessive governmental laws and regulations" are any federal, state, or local
laws, rules, regulations, and ordinances which, taken as a whole (i.e., the
cumulative effect of all such laws and regulations), would require for
compliance the expenditure by Boise Cascade of amounts exceeding $25 million
(exclusive of any monies currently being expended by Boise Cascade) over any
three-year period (part of which may include monies already spent at the time a
force majeure event is declared by Boise Cascade) with respect to the pulp mill.

     14. Defaults; Waivers.

     (a) If any party hereto shall fail to perform any material covenant or
agreement herein contained on its part to be performed, other than by reason of
Force Majeure as provided for in Section 13 hereof, and such default shall
continue for a


                                      -22-
<PAGE>

period of 30 days, 10 days in the case of a monetary default (monetary defaults
are material), after written notice thereof given by the other party, the party
giving such notice may, at its option, terminate this Agreement by giving not
less than 3 business days' prior written notice of such termination to the
defaulting party, provided, however, that in the event a nonmonetary default
cannot be cured by the exercise of reasonable diligence within such period of 30
days, no such termination shall be effective if the defaulting party shall
promptly commence, within such 30-day period, the steps necessary to cure such
default and shall thereafter proceed with due diligence to complete the steps
necessary to cure such default as expeditiously as possible.

     (b) If any party hereto files a debtor's petition for insolvency,
bankruptcy, or reorganization under any chapter of the Federal Bankruptcy Code
or state law relating to insolvency or bankruptcy, or if there is filed against
any party hereto any involuntary petition under any such law relating to
insolvency or bankruptcy praying that such party be reorganized or liquidated or
declared bankrupt which is not stayed or dismissed within 60 days after such
filing, or if a receiver or a trustee is appointed by any court to take
possession of all or a major portion of the assets of such party, then the other
party hereto may terminate this Agreement by giving not less than 3 business
days' prior written notice of such termination to the defaulting party.

     (c) The failure of either party to exercise any right to terminate this
Agreement in the event of default shall not


                                      -23-
<PAGE>


constitute a waiver of the defaulting party's obligation to perform strictly in
accordance with the terms of this Agreement. Any such right to terminate shall
remain in full force and effect and may be exercised so long as such default
continues.

     (d) Whether or not this Agreement is terminated by either party by reason
of any default of the other party hereto, the defaulting party shall at all
times be liable for all damages sustained as a result of its default except as
limited by Section 15(d) hereof.

     (e) Each party shall use commercially reasonable efforts to mitigate the
damages suffered by the non-defaulting party with regard to any breach or
default of such party under the provisions of this Agreement except that Boise
Cascade shall be under no obligation to sell, lease or otherwise dispose of the
Paper Machine if Boise Cascade obtains possession or title to the Paper Machine.

     (f) If Boise Cascade shall default under this Agreement and such default
prevents the operation of the Paper Machine, then for such period of time as
such default shall continue, American Tissue shall not be required to pay the
Direct Costs and Indirect Costs which are attributable to such period of
down-time.

     (g) No waiver by either party of any default by the other party in the
strict and literal performance of or compliance with any provision, condition,
or requirement herein shall be deemed to be a waiver of strict and literal
performance of and compliance with any other provision, condition, or
requirement herein nor to be a waiver of or in any manner release


                                      -24-
<PAGE>

such other party from strict compliance with any provision, condition, or
requirement in the future; nor shall any delay or omission of either party
hereto to exercise any right hereunder in any manner impair the exercise of any
such right accruing to it thereafter. Except when otherwise expressly stated, no
remedy expressly granted herein to either party shall be deemed to exclude any
other remedy which would otherwise be available, including but not limited to a
lawsuit for damages filed in state or federal court in Oregon.

     (h) If American Tissue shall default, after notice and the expiration of
any applicable cure period, under any financing obtained by American Tissue
secured by the Paper Machine or improvements thereto to which Boise Cascade's
lien pursuant to Section 4 has been subordinated, then such default shall
constitute a material default by American Tissue under this Agreement. American
Tissue shall provide Boise Cascade with prompt notice of any notice of default
received by American Tissue with regard to any other such financing.

     (i) If American Tissue offsets any amounts owed to Boise Cascade hereunder
against any credits or other amounts American Tissue asserts that it is owed
from Boise Cascade, Boise Cascade may, if all or any material portion of such
setoff was improper, give written notice of default pursuant to the provisions
of Section 14(a) hereof and shall have all of the rights as set forth in Section
14(a). If American Tissue disputes any invoice from Boise Cascade, American
Tissue shall pay the undisputed portion of the invoice within the time for
payment set forth in Section 7 hereof.


                                      -25-
<PAGE>

     15. Termination by Boise Cascade and American Tissue and Purchase Option.
There are four circumstances described below in subsections (a) through (d) in
which one of the parties has a right to purchase or an obligation to sell the
Paper Machine and, in some cases, certain leasehold improvements. In all such
cases the calculation of the sales price is based in whole or in part on the
"Net Book Value" (or "NBV") of the Paper Machine or leasehold improvements. NBV
is defined as the acquisition cost of the Paper Machine (including but not
limited to the purchase price of $5,000,000.00) or leasehold improvements, and
the cost of all capital improvements to the Paper Machine and/or other leasehold
improvements incurred by American Tissue, less depreciation, all in accordance
with generally accepted accounting principles and the capitalization and
depreciation policies set forth in Exhibit K. Capitalization and depreciation
methods otherwise utilized by American Tissue for financial statements or income
tax purposes shall not be controlling for purposes of this Section 15. In no
case shall the useful life of any asset exceed 20 years from the date such asset
is placed in service for purposes of calculation of the NBV. At the closing of
any sale of the Paper Machine or leasehold improvements to Boise Cascade,
American Tissue shall give the same warranties of title to Boise Cascade as
those given by Boise Cascade to American Tissue pursuant to Exhibit J attached
hereto, except for any liens or encumbrances incurred or suffered by Boise
Cascade, and except as otherwise provided in subsection 15(d) hereof. The
closing of any sale of the Paper Machine shall also constitute termination of
this Agreement in accordance with Section 16 of


                                      -26-
<PAGE>


this Agreement, and shall automatically terminate the Warehouse Site Lease. For
purposes of this Section 15, the Paper Machine shall be deemed to include all
capital improvements thereto.

     (a) Default of American Tissue and Expiration of Term. Upon any termination
of this Agreement due to the default of American Tissue or upon the expiration
of the fixed term of this Agreement on December 31, 2012, Boise Cascade shall
have the option to purchase the Paper Machine on the date of termination of this
Agreement. In the event of American Tissue's default, the purchase price for the
Paper Machine shall be the NBV of the Paper Machine on the date of termination;
Boise Cascade's damages against American Tissue may be applied against the
purchase price. In the event of the expiration of the fixed term of this
Agreement, the purchase price for the Paper Machine shall be the higher of (i)
the NBV of the Paper Machine on December 31, 2002 or (ii) the "fair market
value" of the Paper Machine, calculated on the following basis: The Paper
Machine shall be valued on the assumption that it has been removed from the Mill
and is in storage (but shall not be so removed by American Tissue if such option
is exercised) in Portland, Oregon and there shall be deducted from the resulting
value the estimated cost of removing and transporting the Paper Machine to
Portland, Oregon, and estimated costs of restoration of the Real Property for
any damage that would be caused by the removal of the Paper Machine. In the case
of the expiration of the fixed term of this Agreement, Boise Cascade shall give
American Tissue not less that 120 days' notice prior to the expiration of the
fixed term of this Agreement exercising its option to purchase the Paper


                                      -27-
<PAGE>


Machine. If Boise Cascade fails to exercise its option to purchase the Paper
Machine as aforementioned, the provisions of Section 16 of the Agreement shall
apply. If Boise Cascade exercises its option to purchase the Paper Machine, the
closing shall take place on the fixed expiration date of this Agreement.

     In the case of termination of this Agreement prior to the expiration of the
term hereof by reason of American Tissue's default, Boise Cascade shall have a
30-day period after such termination to elect whether or not to exercise its
option to purchase the Paper Machine, during which time the Paper Machine shall
not be removed from the No. 3 Paper Machine Building or altered in any manner.
If Boise Cascade exercises its option to purchase the Paper Machine within said
30-day period and otherwise in accordance with the provisions of this Agreement,
the closing shall take place ten days after the expiration of said 30-day
period. If Boise Cascade does not exercise its option to purchase the Paper
Machine within such 30-day period and otherwise in accordance with the
provisions of this Agreement, the provisions of Section 16 of the Agreement
shall apply.

     (b) Force Majeure. If Boise Cascade declares an event of force majeure with
respect to excessive governmental laws and regulations in accordance with the
last paragraph of Section 13 of this Agreement and, in connection therewith,
permanently closes its pulp mill at the Mill, American Tissue shall have the
right to require Boise Cascade to purchase the Paper Machine for a purchase
price equal to the NBV of the Paper Machine plus $5,000,000.00 and to purchase
American Tissue's leasehold


                                      -28-
<PAGE>

improvements to the Real Property and to the premises subject to the Warehouse
Site Lease for a purchase price equal to the NBV of such assets as calculated on
the date the pulp mill is permanently closed. Such right shall be exercisable by
American Tissue's giving Boise Cascade notice of such exercise within 30 days of
the closing of the pulp mill and closing shall take place within 30 days after
the giving of such notice. This Agreement shall be terminated at the closing of
such transaction and the applicable provisions of Section 16 shall apply.

     (c) American Tissue's Option. At any time during the six-month period
ending December 31, 2001, American Tissue shall have the right to make a request
to Boise Cascade in writing that any or all of the terms and conditions of this
Agreement be renegotiated. The parties shall have a period of 90 days after such
written request (the "Negotiation Period") to renegotiate any or all of the
terms and conditions of this Agreement. If the parties are unable to reach an
agreement on new terms and conditions for any reason, then American Tissue shall
have the option to terminate this Agreement effective as of December 31, 2002,
by written notice given to Boise Cascade within 90 days after the expiration of
the Negotiation Period. In such event, Boise Cascade shall have the option to
purchase the Paper Machine at a closing to be held on the termination date for a
purchase price equal to the NBV of the Paper Machine as of the date of closing
less $5,000,000.00. If the resulting purchase price figure is negative, such
amount shall be paid to Boise Cascade at the closing. Boise Cascade must
exercise its right to purchase the Paper Machine by giving American Tissue
written notice


                                      -29-
<PAGE>


thereof within 150 days after the expiration of the Negotiation Period.

     (d) Third-Party Action; Breach of Warranty. If any action or proceeding is
commenced by any third party contesting in any manner Boise Cascade's warranty
of title to the Paper Machine or seeking relief that, if granted, would cause
Boise Cascade's warranty of title to the Paper Machine to be breached or would
prohibit American Tissue's ownership, use or possession of the Paper Machine or
the Real Property pursuant to this Agreement (where such prohibition results
other than by reason of American Tissue's fault), Boise Cascade shall, at Boise
Cascade's sole cost and expense (including attorneys' fees by counsel to be
chosen by Boise Cascade, subject to the approval of American Tissue, which
approval shall not be unreasonably withheld or delayed) vigorously defend such
action or proceeding on behalf of Boise Cascade and/or American Tissue. The
parties shall give prompt notice to each other upon learning of any such action
or proceeding. American Tissue shall have the right, but not the obligation, to
participate with Boise Cascade in defending such action or proceeding with
separate counsel of American Tissue's choice, at American Tissue's expense. If
by reason of such action or proceeding, American Tissue must relinquish the
ownership, use or possession of the Paper Machine for a period of at least three
years, then American Tissue shall have the right to terminate this Agreement
effective at any time after the expiration of such three-year period and to
require Boise Cascade to purchase the Paper Machine for a purchase price equal
to the NBV of the Paper Machine plus $5,000,000.00 and to purchase


                                      -30-
<PAGE>

American Tissue's leasehold improvements to the Real Property and to the
Warehouse Site Lease premises for the NBV of such assets (such NBV calculated in
both cases as of the date that American Tissue was required to relinquish such
ownership, use, or possession). The closing of such purchase shall be held 30
days after American Tissue gives notice to Boise Cascade of American Tissue's
election to terminate this Agreement and to require Boise Cascade to purchase
such assets. Simultaneously with the receipt and collection of all of the
closing funds, American Tissue will quit claim to Boise Cascade by using a bill
of sale or other appropriate document or instrument under applicable law, any
and all right, title and interest American Tissue has or may have acquired in
the Paper Machine and shall warrant title to other assets conveyed in accordance
with the first paragraph of this Section 15 and to the extent that American
Tissue has title consistent with the terms of this Agreement. Without limitation
of the foregoing, during the period American Tissue shall have been required to
relinquish ownership, use, or possession of the Paper Machine and thereafter
until such time as American Tissue elects to require Boise Cascade to purchase
the Paper Machine and leasehold improvements pursuant to this Section 15(d) and
the closing in respect thereof is held, (i) all of American Tissue's obligations
under and pursuant to this Agreement shall be suspended, (ii) Boise Cascade
shall not be obligated to furnish to American Tissue the pulp and services
called for in this Agreement and (iii) Boise Cascade shall pay to American
Tissue monthly in arrears, on the fifth day of each month for the previous
month, interest on the NBV of the Paper Machine and


                                      -31-
<PAGE>

leasehold improvements to the Real Property and to the Warehouse Site Lease as
of the date that American Tissue was required to relinquish such ownership, use,
or possession at an interest rate equal to the Prime Rate on the fourth day of
each such month plus 1%. The interest rate calculation shall be made in the same
manner as interest rate calculations are made pursuant to Exhibit I, for
purposes of identifying the Prime Rate. If Boise Cascade is able to restore full
title, use and possession to the Paper Machine to American Tissue on or before
the expiration of the aforementioned three-year period upon all of the terms and
conditions set forth in this Agreement, then it shall do so, and upon such
restoration all such interest accruals and payments shall thereupon cease and
this Agreement shall thereupon be fully reinstated. Such reinstatement shall not
lengthen the term of this Agreement. Boise Cascade shall indemnify American
Tissue for and hold American Tissue harmless against any and all amounts payable
to third parties, such as damages, penalties, costs and expenses (including
reasonable attorneys' fees and court costs) incurred by or asserted against
American Tissue arising out of or in connection with the third party action or
proceeding referred to in this subsection 15(d). The remedies set forth in this
subsection 15(d) shall be American Tissue's sole remedies with respect to the
subject matter of this subsection.

     16. Termination. Upon expiration or termination of this Agreement, American
Tissue shall remove its inventory from the Mill and shall surrender the office
which it occupies pursuant to Section 18 hereof, and the Real Property to Boise
Cascade in as good condition as when received by American Tissue, as same may


                                      -32-
<PAGE>

have been improved or altered pursuant to this Agreement, ordinary wear and tear
excepted. If Boise Cascade does not exercise its purchase option as set forth in
subsections 15(a) and 15(c), American Tissue must, no less than 60 days prior to
termination if termination occurs at the expiration of the term of this
Agreement or in accordance with subsection 15(c) hereof, or within 45 days after
termination if termination otherwise occurs prior to the expiration of the term
of this Agreement, give written notice of its intention to remove or abandon the
Paper Machine. Failure of American Tissue to provide such notice, time being of
the essence, shall result in an abandonment of the Paper Machine to Boise
Cascade without the necessity of any further documentation or conveyances by
American Tissue and the warranties of title required by the first paragraph of
Section 15 hereof shall apply. If American Tissue elects to remove the Paper
Machine, American Tissue must remove the entire Paper Machine, but shall not
remove any of the Real Property, and shall place the Real Property in a safe,
stable, and commercially reasonable condition, and shall have 180 days from the
date of written notice to complete all removal and other related work, such time
period to be tolled by any period of force majeure which prevents or materially
impairs removal of the Paper Machine. If American Tissue abandons the Paper
Machine, no portion of the Paper Machine, or improvements shall be removed. Upon
termination of this Agreement for any reason, American Tissue and Boise Cascade
shall each execute and deliver all documents reasonably requested by the other
party to evidence termination of the lease of the Real Property and the
Warehouse


                                      -33-
<PAGE>


Site Lease, and, in the case of abandonment, documents of conveyance of the
Paper Machine and leasehold improvements to Boise Cascade, free and clear of all
liens, except as otherwise provided hereunder.

     17. Assignment. Except as may be otherwise agreed by the parties hereto, no
party shall assign this Agreement or any interest herein (whether through a sale
of the Paper Machine, sale of stock, merger, consolidation, or otherwise)
without the prior written consent of the other party, which consent each party
covenants shall not be unreasonably withheld or delayed provided that such
assignment is to a financially responsible third party and provided further, no
such assignment shall be permitted to an assignee who is a competitor of Boise
Cascade's business operated at the Mill. However, Boise Cascade may assign all
of its rights and obligations hereunder to any corporation into which it shall
be merged or consolidated or to which it shall sell all or substantially all of
its assets, provided that such corporation assumes all of the obligations so
assigned and that Boise Cascade may assign this Agreement to a purchaser of
substantially all the assets of the Mill which assumes all of the obligations so
assigned. Either party hereto, without such consent, may also assign any or all
of its rights or obligations hereunder to any subsidiary of such party, provided
that such subsidiary shall assume all of the obligations so assigned and that
the assigning party shall unconditionally guarantee performance of such
obligations by such subsidiary. No assignment shall relieve the assignor of any
of its duties, obligations, or liabilities hereunder. Notwithstanding the


                                      -34-
<PAGE>

foregoing, American Tissue shall not assign this Agreement to any third party
which does not simultaneously purchase the Paper Machine.

     18. Facilities for Representatives of American Tissue. Without limitation
of any other provisions of this Agreement, Boise Cascade shall furnish to
American Tissue sufficient enclosed office space (no more than two offices) at
the Mill for the use of representatives authorized by American Tissue while at
the Mill and for the storage of records with respect to the Paper Machine. Boise
Cascade shall also furnish such representatives with such identification papers
as may be necessary to gain access to those parts of the Mill which relate to
the Paper Machine and other facilities relating to the production, storage, and
shipping of the paper from the Paper Machine.

     19. Inspection of Books and Records. Without limitation of any other
provisions of this Agreement, American Tissue shall have the right to inspect
the books, records, related documentation, meters, scales and other measuring
equipment of Boise Cascade for the purpose of determining the accuracy of the
determinations required to be made by Boise Cascade hereunder, such as those
relating to the determination of the pulp price, Direct Costs, Indirect Costs,
Capital Costs, and Excluded Costs. Such inspections shall be conducted during
normal business hours and not more frequently than monthly. Such inspections may
be conducted by employees of American Tissue or by duly authorized
representatives of American Tissue, and all information of Boise Cascade
obtained during or as a result of such inspections shall


                                      -35-
<PAGE>

be kept strictly confidential and shall be used only for the purposes herein
provided.

     20. Payment of Expenses. Each party shall pay the costs and expenses
(including fees of attorneys and accountants) incurred by it in connection with
the negotiation, execution, delivery, and consummation of this Agreement.

     21. Further Documents. Each party will execute and deliver to the other
party such further instruments and documents as such other party may reasonably
request in connection with the consummation of the transactions contemplated by
this Agreement.

     22. Survival of Representations and Warranties. All representations and
warranties included herein shall survive the execution of this Agreement,
notwithstanding any investigation by any party. Each party shall indemnify and
hold the other party harmless from and against any and all claims, damages,
demands, liabilities, actions, proceedings, judgments, penalties, losses, costs,
and expenses (including, without limitation, reasonable attorneys' fees and
court costs) suffered or incurred by the indemnified party arising out of or in
connection with the breach of any representation or warranty by the indemnifying
party.

     23. Governing Law. This Agreement shall be deemed to have been entered into
pursuant to, and shall be governed by the laws of the state of Oregon.

     24. Notices. Any notice, request, or other communication required or
permitted to be given or made hereunder shall be deemed properly given or made
if delivered personally or if mailed by certified mail, return receipt
requested, in the ordinary course, postage prepaid, as follows:



                                      -36-
<PAGE>

             If to Boise Cascade:     Boise Cascade Corporation
                                      Attn: Director of Finance, White Paper
                                      One Jefferson Square
                                      P.O. Box 50
                                      Boise, ID 83728-0001

             With a copy of any
             notice of default to:    Boise Cascade Corporation
                                      Attn: Legal Department
                                      One Jefferson Square
                                      P.O. Box 50
                                      Boise, ID 83728-0001

             If to American Tissue:   American Tissue Mills of Oregon, Inc.
                                      Attn: Messrs. Medhi
                                      Gabayzadeh and Frank DiMaio
                                      50 Cabot Court
                                      Hauppauge, New York 11788

             With a copy of any
             notice of default to:    Mandel & Resnik P.C.
                                      Attn: Barry H. Handel, Esq.
                                      220 East 42nd Street
                                      New York, New York 10017

     25. Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one and the same instrument.

     26. Captions. The titles of the sections and subsections of this Agreement
have been prepared and assigned for convenience only and shall not be construed
as limiting, defining, or affecting the substantive terms of this Agreement.

     27. Entire Agreement. This Agreement contains the entire agreement between
the parties hereto with respect to the transactions contemplated hereby and
supersedes all previous written or oral negotiations, representations,
commitments, and writings with respect to such transactions.


                                      -37-
<PAGE>

     28. Option to Lease. By written notice given at any time prior to December
31, 1997, American Tissue may cause the terms and conditions of the Warehouse
Site Lease annexed hereto as Exhibit G to become effective as of the date which
is 30 days after the date of the notice, without the necessity for any further
signatures or actions by either party.

     29. Venue. The venue for any action brought by one party against the other
party shall be in state or Federal court in Oregon.

     30. Good Faith. There is an obligation of good faith and fair dealing for
both parties with respect to all aspects of this Agreement.

     31. Cumulative Remedies. Except as specifically set forth in subsection
15(d), all remedies available to either party under this Agreement, at law
and/or in equity, shall be cumulative, and such remedies may be exercisable
separately, concurrently, and in any manner or order of priority.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective officers the day and year first above written.

ATTEST:                                       BOISE CASCADE CORPORATION

/s/ ILLEGIBLE                                 By /s/ ILLEGIBLE
------------------------------                   -------------------------------
Assistant Secretary                                  VICE PRESIDENT

ATTEST:                                       AMERICAN TISSUE MILLS OF
                                                OF OREGON, INC.

/s/ ILLEGIBLE                                 By /s/ Nourollah Elghanayan
------------------------------                   -------------------------------
Secretary                                     Title Pres.
DP2lO16C.V3


                                      -38-

Source: OneCLE Business Contracts.