MASTER LEASE AGREEMENT



Lessor:           Super American Tissue Mills of Tennessee LLC
                  135 Engineers Road
                  Hauppauge, New York  11788

Lessee:           American Tissue Mills of Tennessee LLC
                  135 Engineers Road
                  Hauppauge, New York  11788



     The lessor pursuant to this Master Lease Agreement  ("Agreement")  is Super
American Tissue Mills of Tennessee LLC ("Lessor"). All equipment,  together with
all   present   and   future   additions,   parts,   accessories,   attachments,
substitutions,  repairs, improvements and replacements thereof or thereto, which
are the subject of a Lease (as defined in the next  sentence)  shall be referred
to as  "Equipment."  Simultaneously  with the  execution  and  delivery  of this
Agreement,  the parties are entering into one or more Lease  Schedules  (each, a
"Schedule") which refer to and incorporate by reference this Agreement,  each of
which constitutes a lease (each, a "Lease") for the Equipment specified therein.
Additional  details  pertaining  to each Lease are  specified in the  applicable
Schedule. Each Schedule that the parties hereafter enter into shall constitute a
Lease.

     1.  LEASE.  Subject  to and upon all of the  terms and  conditions  of this
Agreement and each Schedule,  Lessor hereby agrees to lease to Lessee and Lessee
hereby  agrees to lease from  Lessor the  Equipment  for the Term (as defined in
Paragraph 2 below) thereof.

     2. TERM.  Each Lease shall be effective and the term of each Lease ("Term")
shall commence on the date of execution of the applicable  Schedule and,  unless
sooner  terminated (as hereinafter  provided),  shall expire upon payment of all
rent and other amounts due and to become due with respect to such  Equipment and
the complete satisfaction by Lessee of all obligations hereunder with respect to
such Equipment;  provided,  however, that obligations due to be performed by the
Lessee during the Term shall continue until they have been performed in full.

     3.  RENT.  Lessee  shall pay as rent to  Lessor,  for use of the  Equipment
during  the  Term,  rental  payments  equal  to the sum of all  rental  payments
including,  without limitation,  security deposits, and interim rents payable in
the amounts and on the dates specified in the applicable  Schedule ("Rent").  If
any Rent or other amount payable by Lessee is not paid within ten days after the
day on which it becomes payable, Lessee will pay on demand, as a late charge, an
amount  equal to 5% of such unpaid  Rent or other  amount but only to the extent
permitted by applicable  law. All payments  provided for herein shall be payable
to Lessor at its address  specified  above, or at any other place  designated by
Lessor.

     4. LEASE NOT CANCELABLE;  LESSEE'S  OBLIGATIONS  ABSOLUTE.  No Lease may be
canceled or terminated except as expressly provided herein.  Lessee's obligation
to


<PAGE>


pay all Rent due or to become due hereunder shall be absolute and  unconditional
and shall not be subject to any delay, reduction, set-off, defense, counterclaim
or recoupment for any reason whatsoever, including any failure of the Equipment.

     5.  WARRANTIES.  LESSOR MAKES NO  REPRESENTATION  OR  WARRANTY,  EXPRESS OR
IMPLIED, AS TO ANY MATTER WHATSOEVER,  INCLUDING, WITHOUT LIMITATION, THE DESIGN
OR CONDITION OF THE EQUIPMENT OR ITS  MERCHANTABILITY,  SUITABILITY,  QUALITY OR
FITNESS FOR A PARTICULAR PURPOSE, AND HEREBY DISCLAIMS ANY SUCH WARRANTY. LESSEE
SPECIFICALLY  WAIVES ALL RIGHTS TO MAKE A CLAIM AGAINST LESSOR FOR BREACH OF ANY
WARRANTY  WHATSOEVER.  LESSEE  LEASES THE  EQUIPMENT  "AS IS." IN NO EVENT SHALL
LESSOR HAVE ANY LIABILITY  FOR, NOR SHALL LESSEE HAVE ANY REMEDY  AGAINST LESSOR
FOR, ANY LIABILITY, CLAIM, LOSS, DAMAGE OR EXPENSE CAUSED DIRECTLY OR INDIRECTLY
BY  THE  EQUIPMENT  OR ANY  DEFICIENCY  OR  DEFECT  THEREOF  OR  THE  OPERATION,
MAINTENANCE OR REPAIR THEREOF OR ANY CONSEQUENTIAL  DAMAGES AS THAT TERM IS USED
IN SECTION  2-719(3) OF THE MODEL  UNIFORM  COMMERCIAL  CODE OR SIMILAR  STATUTE
("UCC").  Lessor grants to Lessee,  for the sole purpose of prosecuting a claim,
the benefits of any and all warranties made available by the manufacturer or the
vendor of the Equipment to the extent assignable.

     6. OWNERSHIP; INSPECTION; MARKING; FINANCING STATEMENTS. Lessee shall affix
to the  Equipment  any labels  supplied by Lessor  indicating  ownership of such
Equipment.  The  Equipment is and shall be the sole  property of Lessor.  Lessee
shall have no right, title or interest therein,  except as lessee under a Lease.
The  Equipment  is and shall at all times be and remain  personal  property  and
shall not become a fixture.  Lessee shall obtain and record such instruments and
take such steps as may be  necessary  to prevent any Person from  acquiring  any
rights in the Equipment by reason of the Equipment being claimed or deemed to be
real  property.  Lessee shall make the  Equipment  and its  maintenance  records
available  for  inspection  by Lessor at  reasonable  times and upon  reasonable
notice.  Lessee shall execute and deliver to Lessor for filing any UCC financing
statements or similar documents Lessor may request.

     7.  EQUIPMENT  USE.  Lessee agrees that the  Equipment  will be operated by
competent,  qualified  personnel in connection  with  Lessee's  business for the
purpose for which the Equipment was designed and in accordance  with  applicable
operating instructions,  laws and government regulations,  and that Lessee shall
use every reasonable  precaution to prevent loss or damage to the Equipment from
fire and other hazards.  Lessee shall procure and maintain in effect all orders,
licenses,  certificates,  permits,  approvals and consents  required by federal,
state  or  local  laws or by any  governmental  body,  agency  or  authority  in
connection with the delivery, installation, use and operation of the Equipment.

     8.  MAINTENANCE.  Lessee,  at its sole  cost and  expense,  shall  keep the
Equipment  in  a  suitable   environment  as  specified  by  the  manufacturer's
guidelines or the  equivalent  and meet all  recertification  requirements,  and
shall  maintain  the  Equipment  in its original  condition  and working  order,
ordinary wear and tear excepted.  At the request of Lessor, Lessee shall furnish
all proof of maintenance.

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<PAGE>


     9. CASUALTY  INSURANCE;  LOSS OR  DAMAGE.Lessee  will maintain,  at its own
expense,  liability and property  damage  insurance  relating to the  Equipment,
insuring  against such risks as are  customarily  insured against on the type of
equipment  leased  hereunder  by  businesses  in which Lessee is engaged in such
amounts, in such form, and with insurers satisfactory to Lessor;

     Until the  expiration of the Lease Term,  Lessee shall bear the entire risk
of theft or  destruction  of, or damage to,  the  Equipment  including,  without
limitation,  any  condemnation,  seizure or  requisition of title or use (each a
"Casualty  Loss"). No Casualty Loss shall relieve Lessee from its obligations to
pay Rent except as provided in the penultimate sentence of this paragraph.  When
any Casualty  Loss occurs,  Lessee shall  immediately  notify Lessor and, at the
option of Lessee,  shall  promptly  (a) place such  Equipment in good repair and
working order;  or (b) replace such Equipment  with other  equipment  reasonably
acceptable  to Lessor  with  respect to value and kind and  consistent  with the
terms  hereof.  The  proceeds  of any  insurance  payable  with  respect  to the
Equipment shall be applied,  at the option of Lessor,  either towards (i) repair
of the  Equipment  or (ii)  payment of any of  Lessee's  obligations  hereunder.
Lessee hereby  appoints Lessor as Lessee's  attorney-in-fact  to make claim for,
receive  payment of, and execute  and  endorse all  documents,  checks or drafts
issued with respect to any Casualty Loss under any insurance  policy relating to
the Equipment.

     10.  TAXES.  Lessee  shall  pay when due,  and  indemnify  and hold  Lessor
harmless  from,  all sales,  use,  excise  and other  taxes,  charges,  and fees
(including,  without  limitation,  income,  franchise,  business and occupation,
gross receipts, sales, use, licensing, registration, titling, personal property,
stamp and interest  equalization  taxes,  levies,  imposts,  duties,  charges or
withholdings  of any  nature),  and any fines,  penalties  or interest  thereon,
imposed or levied by any governmental  body,  agency or tax authority upon or in
connection  with the  Equipment,  its purchase,  ownership,  delivery,  leasing,
possession,  use or relocation of the Equipment or otherwise in connection  with
the transactions  contemplated by each Lease or the Rent  thereunder,  excluding
taxes on or  measured  by the net income of Lessor.  Upon  request,  Lessee will
provide proof of payment.  Unless Lessor elects  otherwise,  Lessor will pay all
property taxes on the Equipment for which Lessee shall reimburse Lessor promptly
upon request. Lessee shall timely prepare and file all reports and returns which
are  required to be made with  respect to any  obligation  of Lessee  under this
Paragraph 10. Lessee shall,  to the extent  permitted by law, cause all billings
of such fees,  taxes,  levies,  imposts,  duties,  withholdings and governmental
charges  to be made to Lessor  in care of  Lessee.  Upon  request,  Lessee  will
provide Lessor with copies of all such billings.

     11.  LESSOR'S  PAYMENT.  If Lessee fails to perform its  obligations  under
Paragraphs 9 or 10 above, or Paragraph 17 below,  Lessor shall have the right to
substitute performance, in which case, Lessee shall immediately reimburse Lessor
therefor.

     12. GENERAL INDEMNITY.  Each Lease is a net lease. Therefore,  Lessee shall
indemnify Lessor and its successors and assigns against, and hold Lessor and its
successors  and assigns  harmless from,  any and all claims,  actions,  damages,
obligations,   liabilities  and  all  costs  and  expenses,  including,  without
limitation, legal fees, incurred by Lessor or its successors and assigns arising
out of each  Lease  including,  without  limitation,  the  purchase,  ownership,
delivery,  lease,


                                       3
<PAGE>


possession,  maintenance,  condition, use or return of the Equipment, or arising
by operation  of law.  Lessee  agrees that upon written  notice by Lessor of the
assertion of any claim, action,  damage,  obligation,  liability or lien, Lessee
shall assume full  responsibility for the defense thereof.  Any payment pursuant
to this  Paragraph  (except  for any payment of Rent) shall be of such amount as
shall be  necessary  so that,  after  payment of any taxes  required  to be paid
thereon by Lessor,  including  taxes on or measured by the net income of Lessor,
the  balance  will  equal the  amount  due  hereunder.  The  provisions  of this
Paragraph  with  regard to matters  arising  during a Lease  shall  survive  the
expiration or termination of such Lease.

     13.  ASSIGNMENT  BY LESSEE.  Lessee  shall not,  without the prior  written
consent of Lessor,  (a) assign,  transfer,  pledge or  otherwise  dispose of any
Lease or Equipment,  or any interest therein; (b) sublease or lend any Equipment
or permit it to be used by anyone  other than Lessee and its  employees;  or (c)
move any Equipment from the location specified for it in the applicable Schedule
without  Lessor's  prior written  consent;  except that if the Equipment is of a
type that is normally  moved from site to site or constitutes  Mobile Goods,  as
such term is defined in the Uniformed  Commercial  Code, it may  temporarily  be
removed from such  location  provided that it will be based at such location and
stored there when not in use, and further  provided that the Equipment shall not
be removed  from the United  States  without  Lessor's  prior  written  consent.
Notwithstanding  anything to the contrary in the immediately preceding sentence,
Lessee may keep any Equipment  consisting of motor  vehicles or rolling stock at
any location in the United States.

     14.  ASSIGNMENT BY LESSOR.  Lessor may at any time,  without the consent of
Lessee,  assign its  interest or grant a security  interest in any Lease and the
Equipment individually or together, in whole or in part.

     15.  DEFAULT;  NO  WAIVER.  Lessee  or any  guarantor  of any or all of the
obligations  of Lessee  hereunder  (together with Lessee,  the "Lease  Parties")
shall be in default under each Lease upon the occurrence of any of the following
events  (each,  an "Event of  Default"):  (a)  Lessee  fails to pay when due any
amount required to be paid by Lessee under or in connection with any Lease;  (b)
any of the Lease  Parties  fails to  perform  any other  provisions  under or in
connection  with a Lease or violates any of the  covenants or agreements of such
Lease Party under or in connection with a Lease; (c) any representation  made or
financial  information  delivered or furnished by any of the Lease Parties under
or in  connection  with a Lease  shall  prove  to have  been  inaccurate  in any
material respect when made; (d) any of the Lease Parties makes an assignment for
the benefit of creditors,  whether voluntary or involuntary,  or consents to the
appointment of a trustee or receiver, or if either shall be appointed for any of
the Lease Parties or for a substantial  part of its property without its consent
and, in the case of any such  involuntary  proceeding,  such proceeding  remains
undismissed or unstayed for forty-five days following the commencement  thereof;
(e) any petition or  proceeding  is filed by or against any of the Lease Parties
under any federal or state  bankruptcy or insolvency code or similar law and, in
the case of any such  involuntary  petition  or  proceeding,  such  petition  or
proceeding  remains  undismissed or unstayed for  forty-five  days following the
filing or  commencement  thereof,  or any of the Lease  Parties takes any action
authorizing any such petition or proceeding;  (f) any of the Lease Parties fails
to pay when due any indebtedness for borrowed money or under  conditional  sales
or  installment  sales  contracts or similar  agreements,  leases or obligations
evidenced by bonds, debentures, notes or other similar agreements or instruments
to any creditor  (including  Lessor under any other agreement) after any

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<PAGE>


and all applicable cure periods  therefore shall have elapsed;  (g) any judgment
shall be rendered  against any of the Lease Parties which shall remain unpaid or
unstayed  for a  period  of  sixty  days;  (h) any of the  Lease  Parties  shall
dissolve, liquidate, wind up or cease its business, sell or otherwise dispose of
all or substantially all of its assets,  make any material change in its capital
structure or lines of business,  amend or modify its name,  merge or consolidate
with any other entity,  suffer any loss or suspension of any license,  permit or
other right or asset necessary to the profitable  conduct of its business,  fail
to pay its debts as they mature,  or call a meeting for purposes of compromising
its debts;  (i) any of the Lease Parties shall deny or disaffirm its obligations
hereunder or under any of the documents  delivered in connection  herewith;  (j)
there is a change in the ownership of any equity or ownership interest of any of
the Lease  Parties or any such  interest  becomes  subject  to any  contractual,
judicial or statutory lien, charge,  security  interests or encumbrance;  or (k)
Lessor, in its reasonable judgment, shall deem itself insecure.

     16. REMEDIES.  Upon the occurrence and continuation of an Event of Default,
Lessor shall have the right, in its sole discretion, to exercise any one or more
of the following  remedies:  (a) terminate  each Lease;  (b) declare any and all
Rent and other amounts then due and any and all Rent and other amounts to become
due under each Lease immediately due and payable;  (c) take possession of any or
all items of Equipment, wherever located, without demand, notice, court order or
other process of law, and without liability for entry to Lessee's premises,  for
damage to Lessee's  property or otherwise;  (d) lease, sell or otherwise dispose
of the Equipment in a commercially reasonable manner, with or without notice and
on public or private bid; (e) recover the following  amounts from the Lessee (as
damages,  including  reimbursement  of costs and  expenses,  liquidated  for all
purposes  and  not  as  a  penalty):  (i)  all  costs  and  expenses  of  Lessor
reimbursable  to  it  hereunder,  including,  without  limitation,  expenses  of
disposition  of the  Equipment,  legal fees and all other  amounts  specified in
Paragraph  17 below;  (ii) an  amount  equal to the sum of (A) any  accrued  and
unpaid Rent through the later of (1) the date of the  applicable  default or (2)
the date that Lessor has obtained possession of the Equipment or such other date
as Lessee has made an effective  tender of possession of the Equipment to Lessor
(the "Default Date") and (B) if Lessor resells or re-lets the Equipment, Rent at
the periodic rate provided for in each Lease for the  additional  period that it
takes Lessor to resell or re-let all of the  Equipment;  (iii) the present value
of all future  Rent  reserved in the Leases and  contracted  to be paid over the
unexpired  Terms of the Leases  discounted at five percent  simple  interest per
annum; (iv) the residual value of the Equipment as of the expiration of the Term
of the applicable  Lease; and (v) any indebtedness for Lessee's  indemnity under
Paragraph  12 above,  plus a late charge at the rate  specified  in  Paragraph 3
above,  less the amount  received by Lessor,  if any, upon sale or re-let of the
Equipment;  and (f)  exercise  any other  right or remedy to recover  damages or
enforce the terms of the Leases.  Lessor may pursue any other rights or remedies
available at law or in equity, including, without limitation, rights or remedies
seeking  damages,  specific  performance and injunctive  relief.  Any failure of
Lessor to require strict  performance by Lessee,  or any waiver by Lessor of any
provision  hereunder or under any Schedule,  shall not be construed as a consent
or  waiver  of any  other  breach  of the same or of any  other  provision.  Any
amendment or waiver of any provision  hereof or under any Schedule or consent to
any departure by Lessee  herefrom or therefrom shall be in writing and signed by
Lessor.


                                       5
<PAGE>

     No right or remedy is exclusive of any other  provided  herein or permitted
by law or equity.  All such rights and remedies  shall be cumulative  and may be
enforced concurrently or individually from time to time.

     17.  LESSOR'S  EXPENSE.  Lessee  shall pay  Lessor on demand  all costs and
expenses in protecting and enforcing Lessor's rights and interests in each Lease
and  the  Equipment,   including,  without  limitation,  legal,  collection  and
remarketing  fees and  expenses  incurred  by Lessor  in  enforcing  the  terms,
conditions or provisions of each Lease or, upon the occurrence and  continuation
of an Event of Default.

     18.  LESSEE'S  WAIVERS.  To the extent  permitted by applicable law, Lessee
hereby  waives  any and all  rights  and  remedies  conferred  upon a lessee  by
Sections 2A-508 through 2A-522 of the UCC. To the extent permitted by applicable
law, Lessee also hereby waives any rights now or hereafter  conferred by statute
or  otherwise  which may  require  Lessor to sell,  lease or  otherwise  use any
Equipment in mitigation  of Lessor's  damages as set forth in Paragraph 16 above
or which may otherwise  limit or modify any of Lessor's rights or remedies under
Paragraph  16. Any  action by Lessee  against  Lessor for any  default by Lessor
under any Lease  shall be  commenced  within  one year  after any such  cause of
action accrues.

     19.  NOTICES;  ADMINISTRATION.  Except as otherwise  provided  herein,  all
notices, approvals, consents, correspondence or other communications required or
desired to be given  hereunder  shall be given in writing and shall be delivered
by overnight  courier,  hand delivery or certified or registered  mail,  postage
prepaid,  if to Lessor,  to Super  American  Tissue Mills of Tennessee  LLC, 135
Engineers Road, Hauppauge, New York 11788, Attention: Mehdi Gabayzadeh; or if to
Lessee,  to  American  Tissue  Mills  of  Tennessee  LLC,  135  Engineers  Road,
Hauppauge, New York 11788, Attention: Mehdi Gabayzadeh; or to such other address
as shall be  designated  by the  addressee by notice to the other party given in
accordance  with the  provisions  of this  Paragraph  19. All such  notices  and
correspondence shall be effective when received.

     20.  REPRESENTATIONS.  Lessee  represents  and  warrants to Lessor that (a)
Lessee is duly organized,  validly  existing and in good standing under the laws
of the State of Delaware; (b) the execution,  delivery and performance by Lessee
of this Agreement are within Lessee's  powers,  have been duly authorized by all
necessary action, and do not contravene (i) Lessee's organizational documents or
(ii) any law or contractual  restriction  binding on or affecting Lessee; (c) no
authorization  or approval or other  action by, and no notice to or filing with,
any governmental authority or regulatory body is required for the due execution,
delivery  and  performance  by  Lessee  of this  Agreement;  and (d) each  Lease
constitutes  the legal,  valid and  binding  obligations  of Lessee  enforceable
against Lessee in accordance with its terms.

     21. FURTHER  ASSURANCES.  Lessee, upon the request of Lessor, will execute,
acknowledge,  record or file, as the case may be, such further  documents and do
such further acts as may be reasonably  necessary,  desirable or proper to carry
out more  effectively  the purposes of this  Agreement.  Lessee hereby  appoints
Lessor as its  attorney-in-fact  to execute  on behalf of Lessee and  authorizes
Lessor to file without  Lessee's  signature  any UCC  financing  statements  and
amendments Lessor deems advisable.



                                       6
<PAGE>

     22. FINANCIAL  STATEMENTS.  Lessee shall deliver to Lessor:  (a) as soon as
available,  but not later  than 120 days  after the end of each  fiscal  year of
Lessee and its consolidated subsidiaries, the consolidated balance sheet, income
statement and  statements of cash flows and  shareholders  equity for Lessee and
its  consolidated  subsidiaries  (the  "Financial  Statements")  for such  year,
reported  on by  independent  certified  public  accountants  without an adverse
qualification;  and (b) as soon as  available,  but not later than 60 days after
the end of each of the first three fiscal  quarters in any fiscal year of Lessee
and its  consolidated  subsidiaries,  the Financial  Statements  for such fiscal
quarter, together with a certification duly executed by a responsible officer of
Lessee that such  Financial  Statements  have been prepared in  accordance  with
generally accepted  accounting  principles and are fairly stated in all material
respects (subject to normal year-end audit adjustments).

     23.   CONSENT  TO   JURISDICTION.   Lessee   irrevocably   submits  to  the
non-exclusive jurisdiction of any New York state or federal court sitting in New
York for any action or proceeding  arising out of or relating to this  Agreement
or the transactions  contemplated hereby, and Lessee irrevocably agrees that all
claims in respect of any such action or proceeding  may be heard and  determined
in such New York state or federal court.

     24. WAIVER OF JURY TRIAL.  LESSEE AND LESSOR IRREVOCABLY WAIVE ALL RIGHT TO
TRIAL  BY JURY IN ANY  ACTION,  PROCEEDING  OR  COUNTERCLAIM  ARISING  OUT OF OR
RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

     25.  SPECIAL TAX  INDEMNIFICATION.  Lessee  acknowledges  that  Lessor,  in
determining the Rent due hereunder, has assumed that certain tax benefits as are
provided to an owner of property  under the Internal  Revenue  Code of 1986,  as
amended (the "Code"),  and under  applicable state tax law,  including,  without
limitation,  depreciation  deductions  under  Section  168 (b) of the Code,  and
deductions  under  Section  163 of the Code in an amount  at least  equal to the
amount of interest  paid or accrued by Lessor with  respect to any  indebtedness
incurred by Lessor in financing its purchase of the Equipment,  are available to
Lessor as a result of the lease of the Equipment.  In the event Lessor is unable
to obtain such tax benefits for any reason, is required to include in income any
amount other than the Rent or is required to recognize  income in respect of the
Rent  earlier  than  anticipated  pursuant to this  Agreement,  Lessee shall pay
Lessor additional rent ("Additional  Rent") in a lump sum in an amount needed to
provide  Lessor with the same  after-tax  yield and after-tax cash flow as would
have  been  realized  by Lessor  had  Lessor  (i) been  able to obtain  such tax
benefits,  (ii) not been required to include any amount in income other than the
Rent and (iii) not been  required  to  recognize  income in  respect of the Rent
earlier than anticipated  pursuant to this Agreement.  The Additional Rent shall
be  computed  by Lessor,  which  computation  shall be  binding  on Lessee.  The
Additional Rent shall be due immediately upon written notice by Lessor to Lessee
of Lessor's  inability to obtain tax  benefits,  the  inclusion of any amount in
income other than the Rent or the  recognition  of income in respect of the Rent
earlier than  anticipated  pursuant to this  Agreement.  The  provisions of this
Paragraph 25 shall survive the termination of this Agreement.

     26. GOVERNING LAW;  SEVERABILITY.  EACH LEASE SHALL BE GOVERNED BY THE LAWS
OF THE  STATE OF NEW  YORK.  IF ANY  PROVISION


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<PAGE>

SHALL BE HELD TO BE INVALID OR UNENFORCEABLE, THE VALIDITY AND ENFORCEABILITY OF
THE REMAINING PROVISIONS SHALL NOT IN ANY WAY BE AFFECTED OR IMPAIRED.

LESSEE  ACKNOWLEDGES  THAT  LESSEE  HAS READ THIS  AGREEMENT  AND THE  SCHEDULES
HERETO,  UNDERSTANDS THEM, AND AGREES TO BE BOUND BY THEIR TERMS AND CONDITIONS.
FURTHER, LESSEE AND LESSOR AGREE THAT THIS AGREEMENT AND THE SCHEDULES DELIVERED
IN  CONNECTION  HEREWITH  FROM  TIME TO  TIME  ARE THE  COMPLETE  AND  EXCLUSIVE
STATEMENT OF THE  AGREEMENT  BETWEEN THE PARTIES,  SUPERSEDING  ALL PROPOSALS OR
PRIOR  AGREEMENTS,  ORAL OR WRITTEN,  AND ALL OTHER  COMMUNICATIONS  BETWEEN THE
PARTIES RELATING TO THE SUBJECT MATTER HEREOF.

     IN WITNESS WHEREOF,  the parties hereto have executed or caused this Master
Lease Agreement to be duly executed by their duly authorized officers as of this
25th day of September, 2000.


AMERICAN TISSUE MILLS OF TENNESSEE LLC
(Lessee)


By: /s/ Mehdi Gabayzadeh
   -----------------------------------------
     Name: Mehdi Gabayzadeh
     Title: Manager



SUPER AMERICAN TISSUE MILLS OF TENNESSEE LLC
(Lessor)

By:/s/ Mehdi Gabayzadeh
   -----------------------------------------
     Name: Mehdi Gabayzadeh
     Title: Manager



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<PAGE>


SCHEDULE NO. 1, dated September 25, 2000 to MASTER LEASE AGREEMENT



Lessor Name & Mailing Address           Lessee Name & Mailing Address
Super American Tissue Mills             American Tissue Mills of Tennessee LLC
 of Tennessee LLC                       135 Engineers Road
135 Engineers Road                      Hauppauge, New York  11788
Hauppauge, New York  11788

Equipment Location
400 Mahannah Avenue
Memphis, Tennessee  38107

This Schedule covers the following described equipment ("Equipment")

                            See Attached Schedule "A"

The  Equipment is hereby leased  pursuant to the  provisions of the Master Lease
Agreement  between the  undersigned  Lessee and Lessor dated as of September 25,
2000, the terms of which are incorporated herein by reference thereto,  plus the
following additional terms, provisions and modifications:

4.   Number of rental payments                     240

5.   Rental payments will be in the
     amount of $175,000. The first
     rental payment will be due on
     September 25, 2000, and subsequent
     rental payments will be due on the
     same day monthly thereafter

6.   Except  as  expressly  provided  or  modified  hereby,  all the  terms  and
     provisions  of the Master  Lease  Agreement  shall remain in full force and
     effect.

In witness whereof, this Schedule is hereby executed and agreed to this 25th day
of September, 2000.

Super American Tissue Mills of          American Tissue Mills of
Tennessee LLC (Lessor)                  Tennessee LLC (Lessee)

By:/s/ Mehdi Gabayzadeh                 By: /s/ Mehdi Gabayzadeh
   ----------------------------------       -----------------------------------
   Name:  Mehdi Gabayzadeh                  Mehdi: Gabayzadeh
   Title: Manager                           Title: Manager