FORT JAMES CORPORATION

                                STOCK OPTION PLAN

                              FOR OUTSIDE DIRECTORS

                  Amended and Restated as of February 18, 1999


        FORT JAMES CORPORATION, a Virginia corporation (the "Company"), hereby
amends and restates its Stock Option Plan for Outside Directors, effective as of
February 18, 1999.

        1. Purpose. This Stock Option Plan for Outside Directors (the "Plan") is
intended to advance the interests of the Company by providing directors of the
Company who are not full-time employees of the Company or a subsidiary
("Directors") with an opportunity to acquire a proprietary interest in the
Company and an additional incentive to promote its success. Stock options
("Options") granted under the Plan are non-statutory options. The Plan conforms
to the provisions of Rule 16b-3 ("Rule 16b-3") of the Securities Exchange Act of
1934 (the "'34 Act"), as presently in effect.

        2. Eligibility and Grant of Options.

                (a) Each person who first becomes a member of the Company's
        Board of Directors (the "Board of Directors"), as a Director after
        February 18, 1999 shall receive an Option to purchase 5,000 shares of
        Common Stock of the Company ("Common Stock") as of the date on which he
        or she first becomes a Director.

                (b) As of each April 15, beginning April 15, 1999, each Director
        who has been a Director for at least nine months shall receive an Option
        to purchase 2,500 shares of Common Stock.

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The option price for each Option shall be determined as of the date of grant,
pursuant to Section 4 below. The Company shall effect the grant of Options under
the Plan by the execution and delivery of written option agreements between the
Company and the Directors receiving the Options ("Optionees").

        3. Stock. The Company has reserved an aggregate of 225,000 shares of
Common Stock for issuance pursuant to the exercise of Options granted under the
Plan. The aggregate number is subject to future adjustments as hereinafter
provided in Section 7. The aggregate number of shares of Common Stock reserved
shall be reduced by the issuance of shares upon the exercise of Options, but it
shall not be reduced if Options, for any reason, expire or terminate
unexercised. The Company shall not be required to issue or deliver any
certificate for shares of its Common Stock purchased upon the exercise of any
part of an Option before (i) the admission of such shares to listing on any
stock exchange on which the Common Stock may then be listed, (ii) receipt of any
required registration or other qualification of such shares under any state or
federal law or regulation that the Company's counsel shall determine is
necessary or advisable, and (iii) the Company shall have been advised by counsel
that all applicable legal requirements have been complied with.

        4. Price. The purchase price of each share of Common Stock covered by an
Option (the "Option Price") shall be equal to the fair market value, as
hereinafter defined, of one share of Common Stock on the date the Option is
granted. If the Common Stock is traded in the over-the-counter market, its fair
market value on a given day shall be the average between the closing bid and
asked prices on such day as reported by the Nasdaq Stock Market. If the Common
Stock is traded on an exchange, its fair market value on a


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<PAGE>

given day shall be the mean of the highest and lowest prices at which it is
traded on such day on the exchange on which it generally has the greatest
trading volume.

        Payment of the Option Price may be made in cash, in shares of Common
Stock, or in any combination thereof. Shares of Common Stock used to make any
such payment shall be valued at the fair market value thereof on the date of
exercise.

        5. Terms and Limitations on Exercise. Options may be exercised, in whole
or in part, but only with respect to whole shares of Common Stock, as outlined
below, by giving timely written notice to the Company.

                (a) The term of any Option shall be ten years from the date it
        is granted. No Option may be exercised after the expiration of its term
        or after the date set forth in subsection (b), (c) or (d) below, if
        earlier.

                (b) If an Optionee ceases to be a member of the Board of
        Directors after he or she attains age sixty-five or on account of his or
        her death or disability (as determined under the Federal Social Security
        Act), the Optionee (or his or her legatees or distributees or the
        personal representatives of his or her estate, in the event of his or
        her death) may exercise his or her outstanding options at any time until
        the first to occur of (x) the date that is two years after the Optionee
        ceases to be a member of the Board of Directors or (y) the date on which
        the Options expire according to their terms.

                (c) If an Optionee ceases to be a member of the Board of
        Directors for any reason other than described in subsection (b) above,
        the Optionee may exercise his or her outstanding Options at any time
        until the first to occur of (x) the date


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<PAGE>

        that is three months after the Optionee ceases to be a member of the
        Board of Directors or (y) the date on which the Options expire according
        to their terms.

                (d) If an Optionee dies after he ceases to be a member of the
        Board of Directors, but within the time period during which his
        outstanding Options are still exercisable, the Optionee's outstanding
        Options may be exercised by his or her legatees or distributees or the
        personal representative of his or her estate. These Options may be
        exercised at any time until the first to occur of (x) the date that is
        two years after the Optionee ceases to be a member of the Board of
        Directors or (y) the date on which the Options expire according to their
        terms.

                (e) Notwithstanding anything herein to the contrary, Options
        shall always be granted and exercised in such a manner as to conform to
        the provisions of Rule 16b-3, or any replacement rule adopted pursuant
        to the provisions of the '34 Act, as the same now exists or may, from
        time to time, be amended.

                (f) The exercise of any Option and delivery of the optioned
        shares shall be contingent upon the receipt by the Company of the full
        purchase price in cash or shares of Common Stock as provided in Section
        4.

        6.      Non-transferability of Options.

                (a) In general, Options, by their terms, shall not be
        transferable other than by will or the laws of descent and distribution,
        or as described below. Options shall be exercisable, during the lifetime
        of the Optionee, only by the Optionee or the Optionee's guardian or
        legal representative.

                (b) Notwithstanding the provisions of subsection (a) and subject
        to applicable securities laws, an Optionee may transfer any Options that
        have been


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<PAGE>

        or will be granted to the Optionee under this Plan to one or more of the
        Optionee's immediate family members, to a trust or trusts for the
        benefit of any one or more of the Optionee's immediate family members,
        or to a partnership, limited liability company or other entity the only
        partners, members or interest holders of which are among the Optionee's
        immediate family members. No consideration may be paid for the transfer
        of any Option. The transferor shall be subject to all conditions
        applicable to the Option prior to its transfer. Notwithstanding the
        provisions of Section 8, the Board of Directors may impose on any
        Option, and on Common Stock issued upon exercise of an Option, such
        limitations and conditions as the Board of Directors deems appropriate,
        and may amend the agreement granting the Option to set forth such
        limitations and conditions.

        7. Effect of Stock Dividends and Other Changes. Appropriate adjustments
shall be made automatically to the price of the shares and the number of shares
subject to option if there are any changes in the Common Stock by reason of
stock dividends, stock splits, reverse stock splits, recapitalizations, mergers,
or consolidations.

        8. Administration of the Plan. The Board of Directors shall be
responsible for the proper implementation of the Plan, but the Board of
Directors shall not exercise any discretion with respect to the administration
of the Plan.

        9. Expiration and Termination of the Plan. Options may be granted under
the Plan at any time until the Plan is terminated by the Board of Directors or
until such earlier date when termination of the Plan shall be required by law.
If not sooner terminated, the Plan shall terminate automatically on June 8,
2004.



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        10. Amendments. The Board of Directors may from time to time make such
changes in and additions to the Plan as it may deem proper. The termination of
the Plan or any change or addition to the Plan shall not, without consent of any
Optionee who is adversely affected thereby, alter any options previously granted
to the Optionee pursuant to the Plan.

        11. Effective Date. The amendment and restatement of the Plan shall be
effective as of February 18, 1999.


        IN WITNESS WHEREOF, the Company has caused this Plan to be executed.

                                            FORT JAMES CORPORATION

                                            By:_________________________________