Document:

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                                                                    EXHIBIT 10.2

                           MCM CAPITAL GROUP, INC.
                              5775 ROSCOE COURT
                         SAN DIEGO, CALIFORNIA 92123

                              As of May 22, 2000

Mr. J. Brandon Black

Dear Mr. Black:

      It is with great pleasure that we hereby confirm your employment as
Executive Vice President and Chief Operating Officer of MCM Capital Group, Inc.
(the "Company"), on the terms and conditions set forth in this letter and in the
attached "Employment Term Sheet." This letter and the Employment Term Sheet are
collectively referred to as this "Agreement". Capitalized terms that are not
defined herein shall have the meaning set forth in the Employment Term Sheet.

      1. During the term of your employment with the Company, you shall also
serve as Executive Vice President and Chief Operating Officer of Midland Credit
Management, Inc. and may also serve as an officer and/or director of certain
other subsidiaries of the Company.

      2. This Agreement contains the entire agreement between the parties with
respect to the matters covered herein and supersedes all prior agreements,
written or oral, with respect thereto. This Agreement may only be amended,
superseded or canceled and the terms hereof waived, by a written instrument
signed by you and the Company, or in the case of a waiver, by the party waiving
compliance.

      3. You will report to the Chief Executive Officer of the Company and your
duties will be performed primarily at the Company's offices in the San Diego,
California area. The Company shall furnish sufficient facilities, services,
staffing and assistance to enable you to perform your duties hereunder. The term
of your employment shall continue through May 22, 2003, provided that such term
shall be automatically extended for successive one (l) year periods unless
either you or the Company gives written notice to the other, at least ninety
(90) calendar days before such extension is to (or would) take effect, that they
do not wish to extend (the "Term"). Your employment may be terminated prior to
the expiration of the Term: (i) in the event that you shall die; (ii) in the
event that you shall become Disabled (for purposes of this clause (ii),
"Disabled" shall mean that you shall have failed, due to illness or other
physical or
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mental incapacity, to render services of the character contemplated by this
Agreement for an aggregate of more than ninety (90) calendar days during any
twelve (12) month period); (iii) for "Cause" (as hereinafter defined); or (iv)
in the event that you give written notice to the Company of your resignation.

      4. For purposes of this Agreement, "Cause" means: (i) commission of any
act of fraud or gross negligence by you in the course of your employment
hereunder which, in the case of gross negligence, has a material adverse effect
on the business or condition (financial or otherwise) of the Company; (ii)
willful material misrepresentation at any time by you to the Chief Executive
Officer of the Company, the Board of Directors of the Company (the "Board") or
the Chairman of the Board; (iii) willful failure or refusal to comply with any
of your obligations hereunder or with the reasonable and lawful instructions of
the Board or the Chief Executive Officer; (iv) engagement by you in any conduct
or the commission by you of any act which is in the reasonable opinion of the
Board, materially injurious or detrimental to the substantial interest of the
Company or any of its material subsidiaries or affiliates; (v) indictment for
any felony involving fraud or moral turpitude or conviction of or pleading
guilty to any other felony, whether of the United States or any state thereof or
any similar foreign law to which you may be subject; (vi) any failure to
substantially comply with any written lawful rules, regulations, policies or
procedures of the Company furnished to you which, if not complied with, could
reasonably be expected to have a material adverse effect on the business of the
Company or any of its material subsidiaries or affiliates; or (vii) any willful
failure to comply with the Company's, or any of its subsidiaries' or affiliates'
policies regarding insider trading; provided, however, that in the case of
clause (vi) of the definition of "Cause" set forth in this section, if your
failure or refusal referred to therein is curable by you, then "Cause" shall not
be deemed to exist unless you fail to so cure within five (5) business days of
your receipt from the Company of a written request for such cure and such
request to cure is the first such request delivered under this section with
respect to such failure.

      5. If either (i) your employment is terminated "Without Cause" by the
Company (as hereinafter defined) or (ii) there is a "Control Event," (as
hereinafter defined) then in either event the Company shall pay to you a sum
equal to your Base Salary in effect as of the effective date of such termination
for the longer of (A) the then remaining effective Term, or (B) 12 months from
the date of the termination of your employment, payable in semi-monthly
installments commencing with the month after such termination. In addition, in
the event of either of the foregoing, you will be entitled (i) to receive (A)
payment of all accrued and unpaid vacation days and other benefits and
reimbursements, and (B) within 30 days of such termination, a pro rata portion
of your annual bonus for the portion of the calendar year that you worked for
the Company prior to such termination of employment computed using the amount of
your bonus for the prior calendar year, and (ii) at your election, to continue
for a period of 18 months your coverage under all health, medical, disability
and other similar insurance policies, pursuant to Section 4980B of the Internal
Revenue Code, as amended, or under Part 6 of Title I of the Employment
Retirement Income Security Act of 1974, as amended, provided to you by the
Company, the cost of such coverage to be allocated between you and the Company
in a manner consistent with the allocation of the costs thereof applicable prior
to the termination of your employment. Terminated "Without Cause" shall mean (i)
the termination of your employment for any reason other than (A) as set forth in
clauses (i) - (iv) of Section 3 or (B) a decision by

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you or the Company to deliver the written notice referred to in the third
sentence of Section 3, (ii) a substantial and material reduction of your
responsibilities as Executive Vice President and Chief Operating Officer, (iii)
a reduction in your Base Salary or (iv) a requirement that you relocate outside
the San Diego, California metropolitan area without your consent. "Control
Event" shall mean the occurrence of both (i) a "Change of Control" as defined on
Annex A hereto, and (ii) within 12 months thereof, one of the events described
in clauses (ii), (iii) or (iv) of the definition of "Without Cause" shall have
occurred and within such twelve (12) month time period you shall have resigned
from the Company. In consideration of the monies to be paid and the benefits to
be provided to you, you agree to execute and deliver to the Company on or before
any payment by the Company a release substantially in the form of Annex B
hereto, failing which, except to the extent required by law, the Company shall
be relieved of all of its obligations hereunder. Upon any termination of your
employment with the Company, you will return to the Company, all Company/or its
subsidiary-owned property, including, without limitation, credit cards,
computers, cellular phones, files, etc.

      6. You acknowledge that as the Company's Executive Vice President and
Chief Operating Officer you will be involved, at the highest level, in the
development, implementation, and management of the Company's and its
subsidiaries' businesses, strategies and plans, including those which involve
the Company's and its subsidiaries' finances, marketing, industrial relations,
operations, acquisitions, business models and programs. By virtue of your unique
and sensitive position, your employment by a competitor of the Company or its
subsidiaries represents a serious competitive danger to the Company and its
subsidiaries and the use of your talent, knowledge, and information about the
Company's and its subsidiaries' businesses, strategies, and plans can and would
constitute a valuable competitive advantage over the Company and its
subsidiaries. In view of the foregoing, you covenant and agree that during the
term of your employment and, for the period during which you are receiving any
payments pursuant to Section 5, you will not engage or be engaged in a similar
capacity or responsibility as you served or performed for the Company, directly
or indirectly, including, but not limited to, as an employee, agent, consultant,
manager, executive, owner, financing source or stockholder (except as a passive
investor owning less than one percent (1%) interest in a publicly held company)
in the Collection Business. For purposes of this Section 6, "Collection
Business" shall be defined as the business of purchasing and/or collecting
charged off consumer debt. Notwithstanding the foregoing, if this Agreement is
assigned by the Company as provided herein, the terms of this section shall not
apply to any business engaged in by the assignee that is not related or similar
to any business engaged in (or contemplated to be engaged in) by the Company at
the time of such assignment.

      7. You agree to treat as confidential and not to disclose to anyone other
than the Company, its subsidiaries and affiliated companies, and you agree that
you will not at any time during your employment and at any time thereafter,
without the prior written consent of the Company, divulge, furnish, or make
known or accessible to, or use for the benefit of anyone other than the Company,
its subsidiaries and affiliated companies, any information of a confidential
nature relating in any way to the business of the Company, its subsidiaries or
affiliated companies, or any of their respective affiliates, members,
shareholders, officers, employees or directors, or any other Person having a
direct business relationship with the Company or its subsidiaries, unless (i)
you are required to disclose such information by

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requirements of law, (ii) such information is in the public domain through no
fault of yours, or (iii) such information has been lawfully acquired by you from
other sources unless you know that such information was obtained in violation of
an agreement of confidentiality. You further agree, that in consideration of
this Agreement, that you will refrain from engaging in any conduct or making any
statement, written or oral, which are detrimental to the Company, its
subsidiaries or affiliated companies or any of their respective affiliates,
members, shareholders, officers, employees or directors, other than statements
to the President, Chairman of the Board of the Company or the Board of Directors
of the Company, or any member thereof.

      8. You agree that in addition to any other remedy provided at law or in
equity (a) the Company shall be entitled to a temporary restraining order, and
both preliminary and permanent injunctive relief restraining you from violating
the provisions of the Paragraphs 6 and 7; and (b) the Company's remaining
obligations under this letter agreement, if any, shall cease (other than payment
of your base salary through the date of such violation, plus $100.00 and any
earned but unpaid vacation or except as may be required by law) as a result of
any willful or reckless material violation of such provisions.

      9. The provisions of the Sections 6, 7, 8, 10 and 13 of this Agreement
shall specifically survive any termination of this Agreement.

      10. You agree that the Company may withhold from any amounts payable to
you hereunder all federal, state, local or other taxes that the Company
determines are required to be withheld pursuant to any applicable law or
regulation. You further agree that if the Internal Revenue Service or other
taxing authority (each, a Taxing Authority) asserts a liability against the
Company for failure to withhold taxes on any payment hereunder, you will pay to
the Company the amount determined by such taxing authority that had not been
withheld within ninety (90) days of notice to you of such determination. Such
notice shall include a copy of any correspondence received from a Taxing
Authority with respect to such withholding.

      11. Any notice or other communication required or permitted under this
Agreement shall be in writing and shall be delivered personally, or sent by
certified, registered or express mail, postage prepaid, return receipt
requested. Any such notice shall be deemed given when so delivered personally,
or, if mailed, on the earlier of actual receipt or the third (3rd) business day
after the date of such mailing, (i) if to the Company, to the attention of the
General Counsel at 5775 Roscoe Ct., San Diego, CA 92123, (with a copy to Snell &
Wilmer, One Arizona Center, Phoenix, Arizona 85004, Attention: Steven D.
Pidgeon, Esq.), and (ii) if to you, at the address first written above.

      12. This Agreement and your rights and obligations hereunder may not be
assigned by you, provided that upon death your rights hereunder shall survive
and may be assigned, or conveyed by will, trust or operation of law, including
without limitation, intestate succession. The Company may assign this letter
agreement and its rights, together with its obligations, hereunder in connection
with any sale, transfer or other disposition of all or substantially all of its
assets or business, whether by merger, consolidation or otherwise.

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      13. This letter agreement constitutes the entire agreement between you and
Company with respect to the matters referred to herein and supersedes all prior
agreements, whether written or oral with respect hereto, between the Company and
you. This letter agreement shall be governed by the laws of the State of
California, without regard to principles of conflicts of laws of such State.
Each party agrees to reimburse the other for any reasonable attorneys' fees and
expenses expended by it to enforce its rights hereunder if the other party
willfully or recklessly breaches its obligations hereunder.

      If you agree with the terms of this Agreement, please date and sign the
copy of this letter enclosed for that purpose and return it to me.

                                    Sincerely,

                                    MCM CAPITAL GROUP, INC.

                                    By: /s/ Eric D. Kogan
                                        -------------------
                                          Eric D. Kogan

Agreed and Accepted:

/s/ J. Brandon Black
-------------------------
J. Brandon Black

Date: March 20, 2002

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<PAGE>
                               J. BRANDON BLACK
                           EXECUTIVE VICE PRESIDENT
                         AND CHIEF OPERATING OFFICER
                                      OF
                           MCM CAPITAL GROUP, INC.
                       MIDLAND CREDIT MANAGEMENT, INC.

                            EMPLOYMENT TERM SHEET

<TABLE>
<CAPTION>
      PROVISION                        TERM                            COMMENTS
      ---------                        ----                            --------
<S>                        <C>                               <C>
CONTRACT TERM              Initial Term through May          Automatic one (1) year
                           22, 2003                          extensions granted at the
                                                             end of such initial term and
                                                             each annual anniversary
                                                             thereafter, unless the
                                                             executive or the Company
                                                             gives notice ninety (90)
                                                             calendar days before such
                                                             extension is or would take
                                                             effect.
BASE SALARY                $225,000/year, to be paid         Subject to annual review
("Base Salary")            on a regular basis by the         during January of each year
                           Company in accordance with        commencing in 2003.
                           the Company's payroll
                           procedures and policies.
ANNUAL CASH                The executive shall be
INCENTIVE BONUS            eligible to receive annual
                           cash bonuses based on the
                           Company and individual
                           performance assessed for
                           each fiscal year relative to
                           objectives agreed to in
                           advance between the
                           executive and the Board;
                           provided that with respect
                           to the year ended December
                           31, 2001, the executive's
                           cash bonus shall be no less
                           than 50% of his Base Salary.

                           Executive's bonus target
                           shall be 100% of his Base
                           Salary.

STOCK OPTIONS              200,000 options with an           Additional grants to be
                           exercise price of                 considered annually.
                           $1.00/share.
                           50% will vest:                    The grant, vesting and
                             1/3 on May 23, 2000,            exercising of options shall
                             1/3 on May 23, 2001, and        be governed by the Company's
                             1/3 on May 23, 2002.            Equity Participation Plan,
                           25% will vest on May 23, 2003.    as it may be amended or
</TABLE>

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<TABLE>
<S>                        <C>                               <C>
                           25% will vest on May 23,          restated from time to time
                           2004.                             and any Stock Option
                                                             Agreement between the
                                                             executive and the Company.

                                                             Options will vest on change
                                                             of control (as defined in
                                                             Annex A)
BENEFITS                   Benefits as are generally
                           made available to other
                           executives of the Company,
                           including participation in
                           the Company's
                           health/medical and
                           insurance programs.
VACATION                   4 weeks per year.                 Can carry forward any unused
                                                             days in accordance with
                                                             Company policy.
EXPENSES                   Reasonable and necessary
                           out-of-pocket expenses
                           incurred in the performance
                           of duties shall be
                           reimbursed by the Company
                           in accordance with its
                           policies.
</TABLE>

                                       7
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                                                                         Annex A

For purposes of this Agreement, the term "Change of Control" shall mean and
include any one or more of the following events:

      (i) the Company is merged into or consolidated with another corporation,
in a transaction in which, upon completion, the Company's stockholders
beneficially own (within the meaning of Rule 13d-3 under the Securities Exchange
Act of 1934, as amended (the "Exchange Act")), less than 50% of the total voting
securities entitled to vote generally in the election of directors of the
surviving or resulting company outstanding;

      (ii)  all or substantially all of the assets of the Company are
acquired by another corporation;

      (iii) any person (as such term is used in Section 13(d) and 14(d)(2) of
the Exchange Act), other than any employee benefit plan of the Company or any
subsidiary of the Company or any entity holding shares of capital stock of the
Company for or pursuant to the terms of any such employee benefit plan in its
role as an agent or trustee for such plan, shall acquire 50% or more of the
Company's outstanding voting stock entitled to vote generally in the election of
directors; or

      (iv)  a majority of the Directors of the Company being Individuals not
nominated by the Board of Directors.

      Notwithstanding the foregoing, the events described above shall not be
deemed to be a "Change of Control" if they occur as a result of (i) a
transaction involving any person (as defined in clause (iii) above) which is the
beneficial owner (as defined in clause (i) above) as of the date of this
Agreement, of more than 5% of the Company's outstanding voting stock entitled to
vote generally in the election of directors or any "associate" or "affiliate" of
such person (as such terms are defined in Rule 405 promulgated under the
Securities Act of 1933, as amended) or (ii) in the case of clause (iii) above, a
person acquiring such 50% ownership position as a result of the acquisition by
the Company of its voting stock which reduces the number of outstanding shares
of voting stock of the Company.

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<PAGE>
                                                                         Annex B
                               GENERAL RELEASE
                           AND COVENANT NOT TO SUE

      TO ALL WHOM THESE PRESENTS SHALL COME OR MAY CONCERN, KNOW that:

      J. Brandon Black (the "Executive"), on his own behalf and on behalf of his
descendants, dependents, heirs, executors and administrators and permitted
assigns, past and present, in consideration for the amounts payable to the
undersigned under that Letter Agreement dated as of May 22, 2000 (the
"Employment Agreement") between Executive and MCM Capital Group, Inc. (the
"Company"), does hereby covenant not to sue or pursue any litigation (or file
any charge or otherwise correspond with any Federal, state or local
administrative agency) against, and waives, releases and discharges the Company,
and its respective assigns, affiliates, subsidiaries, parents, predecessors and
successors, and the past and present shareholders, employees, officers,
directors, representatives and agents or any of them (collectively, the "Company
Group"), from any and all claims, demands, rights, judgments, defenses, actions,
charges or causes of action whatsoever, of any and every kind and description,
whether known or unknown, accrued or not accrued, that Executive ever had, now
has or shall or may have or assert as of the date of this General Release
against any of them, including, without limiting the generality of the
foregoing, any claims, demands, rights, judgments, defenses, actions, charges or
causes of action related to employment or termination of employment or that
arise out of or relate in any way to the Age Discrimination in Employment Act of
1967 ("ADEA), as amended, the Older Workers Benefit Protection Act, Title VII of
the Civil Rights Act of 1964, as amended, and other Federal, state and local
laws relating to discrimination on the basis of age, sex or other protected
class, all claims under Federal, state or local laws for express or implied
breach of contract, wrongful discharge, defamation, intentional infliction of
emotional distress, and any related claims for attorneys' fees and costs;
provided, however, that nothing herein shall release any member of the Company
Group from any of its obligations under the Employment Agreement or any rights
to indemnification under any charter or by-laws (or similar documents) of any
member of the Company Group. The Executive further agrees that this General
Release and Covenant to Sue may be pleaded as a full defense to any action, suit
or other proceeding covered by the terms hereof which is or may be initiated,
prosecuted or maintained by the Executive, his heirs or assigns. Notwithstanding
the foregoing, the Executive understands and confirms that he is executing this
General Release and Covenant Not to Sue voluntarily and knowingly, and this
Covenant Not to Sue shall not affect the Executive's right to claim otherwise
under ADEA. In addition, the Executive shall not be precluded by this Covenant
from filing a charge with any relevant Federal, State or local administrative
agency, but the Executive agrees not to participate in, and agrees to waive his
rights with respect to any monetary or other financial relief arising from any
such administrative proceeding.

      The Company, on its own behalf and on behalf of its assigns, affiliates,
subsidiaries, parents, predecessors and successors, and its past and present
shareholders, employees, officers, directors, representatives and agents or any
of them, does hereby covenant not to sue or pursue

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any litigation (or file any charge or otherwise correspond with any Federal,
state or local administrative agency) against, and waives, releases and
discharges Executive and his heirs, successors and assigns, descendants,
dependents, executors and administrators, past and present, and any of his
affiliates and each of them (collectively, the "Executive Releasees") from any
and all claims, demands, rights, judgments, defenses, actions, charges or causes
of action whatsoever, of any and every kind and description, whether known or
unknown, accrued or not accrued, that the Company or any of its subsidiaries
ever had, now has or shall or may have or assert as of the date of this General
Release against any of them, based on facts known to any executive officer of
the Company as of the date of this General Release and Covenant Not to Sue
(other than the Executive), including specifically, but not exclusively and
without limiting the generality of the foregoing, any and all claims, demands,
agreements, obligations and causes of action arising out of or in any way
connected with any transaction, occurrence, act or omission related to
Executive's employment by the Company or any of its subsidiaries or the
termination of that employment; provided, however, that nothing herein shall
release the Executive Releasees from any obligations arising out of or related
in any way to Executive's obligations under the Employment Agreement or any
agreement governing the terms of any stock options granted to the Executive or
impair the right or ability of the Company to enforce the terms thereof.

      In consideration for the amounts payable to the Executive under the
Employment Agreement, the Executive agrees to cooperate, at the expense of the
Company Group, with the members of the Company Group in connection with all
litigation relating to the activities of the Company and its affiliates during
the period of the Executive's employment with the Company including, without
limitation, being available to take depositions and to be a witness at trial,
help in preparation of any legal documentation and providing affidavits and any
advice or support that the Company or any affiliate thereof may request of the
Executive in connection with such claims.

      In furtherance of their respective agreements set forth above, each of the
Executive and the Company hereby expressly waives and relinquishes any and all
rights under any applicable statute, doctrine or principle of law restricting
the right of any person to release claims which such person does not know or
suspect to exist at the time of executing a release, which claims, if known, may
have materially affected such person's decision to give such a release. In
connection with such waiver and relinquishment, each of the Executive and the
Company acknowledges that it is aware that it may hereafter discover claims
presently unknown or unsuspected, or facts in addition to or different from
those which it now knows or believes to be true, with respect to the matters
released herein. Nevertheless, it is the intention of each of the Executive and
the Company to fully, finally and forever release all such matters, and all
claims relative thereto which now exist, may exist or theretofore have existed,
as specifically provided herein. The parties hereto acknowledge and agree that
this waiver shall be an essential and material term of the release contained
above. In addition, and not by way of limitation to the foregoing, each of the
Executive and the Company fully understands and knowingly and expressly waives
its rights and benefits under Section 1542 of the California Civil Code or under
any similar provision of law. Section 1542 of the California Civil Code states
that:

            "A general release does not extend to claims which the creditor does
            not know or suspect to exist in his favor at the time of

                                       10
<PAGE>
            executing the release, which if known by him must have materially
            affected his settlement with the debtor."

Nothing in this paragraph is intended to expand the scope of the release as
specified herein.

      This General Release shall be governed by and construed in accordance with
the laws of the State of California, applicable to agreements made and to be
performed entirely within such State.

      To the extent that the Executive is forty (40) years of age or older, this
paragraph shall apply. The Executive acknowledges that he has been offered a
period of time of at least twenty-one (21) days to consider whether to sign this
General Release, which he has waived, and the Company agrees that the Executive
may cancel this General Release at any time during the seven (7) days following
the date on which this General Release has been signed by all parties to this
General Release. In order to cancel or revoke this General Release, the
Executive must deliver to the General Counsel of the Company written notice
stating that the Executive is canceling or revoking this General Release. If
this General Release is timely cancelled or revoked, none of the provisions of
this General Release shall be effective or enforceable and the Company shall not
be obligated to make the payments to the Executive or to provide the Executive
with the other benefits described in this General Release and all contracts and
provisions modified, relinquished or rescinded hereunder shall be reinstated to
the extent in effect immediately prior hereto.

      Each party agrees that as part of the consideration for this General
Release, they will not make disparaging or derogatory remarks, whether oral or
written, about the other party or its representatives.

      Each of the Executive and the Company acknowledge that they have entered
into this General Release knowingly and willingly and has had ample opportunity
to consider the terms and provisions of this General Release.

      IN WITNESS WHEREOF, the parties hereto have caused this General Release to
be executed on this _____ day of __________________, 200__.

                                          _____________________________________
                                          J. Brandon Black

                                          MCM CAPITAL GROUP, INC.

                                          By:__________________________________
                                          Name:
                                          Title:

                                       11<PAGE>

                                                                     EXHIBIT 4.7

                          FIRST SUPPLEMENTAL INDENTURE

         FIRST SUPPLEMENTAL INDENTURE dated as of September 19, 1997 between
FORT JAMES CORPORATION, formerly James River Corporation of Virginia, a
corporation duly organized and existing under the laws of the Commonwealth of
Virginia (the "Company") and THE BANK OF NEW YORK, a New York corporation, as
Trustee (the "Trustee").

                             RECITALS OF THE COMPANY

         WHEREAS, the Company has heretofore executed and delivered to the
Trustee a certain Indenture, dated as of November 1, 1991 (the "Original
Indenture"), pursuant to which one or more series of unsecured debentures,
securities or other evidences of indebtedness of the Company (the "Securities")
may be issued from time to time; and

         WHEREAS, Section 901 of the Original Indenture provides that, without
the consent of any Holders of Securities or coupons, the Company, when
authorized by a Board Resolution, and the Trustee, at any time and from time to
time, may enter into an indenture supplemental to the Original Indenture for the
purpose, among other things, of (i) changing or eliminating any of the
provisions of the Original Indenture, provided that such change or elimination
shall become effective only when there is no Security Outstanding of any series
created prior to the execution of such supplemental indenture which is entitled
to the benefit of such provision; (ii) establishing the form or terms of
Securities of any series and any related coupons as permitted by Sections 201
and 301 of the Original Indenture; or (iii) making any other provisions with
respect to matters or questions arising under the Original Indenture, provided
that such actions shall not adversely affect the interest of the Holders of
Securities of any series or any related coupons in any material respect; and

         WHEREAS, the Company, pursuant to the foregoing authority, desires to
amend and supplement the Original Indenture in certain respects.

         NOW, THEREFORE, in consideration of the premises and for other good and
valuable consideration, the receipt of which is hereby acknowledged, it is
mutually agreed, for the equal and proportionate benefit of all Holders of
Securities of any series originally issued after the date hereof, as follows:

                                   ARTICLE ONE

         The Original Indenture is supplemented and amended in the following
respects:

         1. The introductory paragraph of the Original Indenture is hereby
amended by inserting the words "Fort James Corporation, formerly" prior to the
words "James River Corporation of Virginia."

<PAGE>

         2. Section 301 of the Original Indenture is amended by deleting the
word "and" after the semicolon in clause 16 and inserting after clause 16 the
following:

            "(17) provisions, if any granting special rights to the
            Holders of Securities of the series upon the occurrence of
            such events as may be specified;
            (18) any deletions from, modifications of or additions to the
            Events of Default or covenants (including any deletions from,
            modifications of or additions to Section 1010) of the Company with
            respect to Securities of the series, whether or not such Events of
            Default or covenants are consistent with the Events of Default or
            covenants set forth herein;
            (19) whether, under what circumstances and the currency in which
            the Company will pay additional amounts as contemplated by Section
            1010 on the Securities of the series to any Holder who is not a
            United States person (including any modification to the definition
            of such term) in respect of any tax, assessment or governmental
            charge and, if so, whether the Company will have the option to
            redeem such Securities rather than pay such additional amounts
            (and the terms of any such option); and"

         In addition clause 17 of Section 301 of the Original Indenture is
renumbered as clause 20.

         3. Clause 5 of Section 501 of the Original Indenture is amended by
deleting the phrase "at least $10,000,000 aggregate principal amount of
indebtedness for borrowed money" and replacing it with the phrase "at least
$25,000,000 individually or $50,000,000 in the aggregate of principal amount of
indebtedness for borrowed money" and by deleting the period at the end of such
clause and inserting in lieu thereof "; or".

         4. Clause 8 of Section 501 of the Original Indenture is hereby
renumbered as clause 9, and the following is added as a new clause 8 of Section
501 of the Original Indenture:

            "(8) failure within 60 days to pay, bond or otherwise
            discharge any uninsured final judgment or court order
            rendered against the Company or any Subsidiary requiring the
            payment of money in excess of $50,000,000 which is not stayed
            on appeal or is not otherwise being contested in good faith".

         5. After Section 906 of the Original Indenture, the following is added
as Section 907 of the Original Indenture:

            "Section 907.  Notice of Supplemental Indentures.

                     Promptly after the execution by the Company and the
             Trustee of any supplemental indenture pursuant to the
             provisions of Section 902, the Company shall give notice
             thereof to the Holders of the Outstanding Securities
             affected, in the manner provided for in Section 106, setting
             forth in general terms the substance of such supplemental
             indenture."

                                       2

<PAGE>

         6.  Subsection (a) of Section 1006 of the Original Indenture is hereby
amended as follows:

             (a) The words "create or assume" are deleted and replaced
             with the words "create, incur, assume or guarantee" in each
             place in which they appear.

             (b) In additional, the words "indebtedness that is secured by
             a" are added prior to the word "mortgage" in the third line,
             and the words "indebtedness that is secured by" are added
             prior to the words "any of the following" at the end of the
             paragraph.

         7.  Clause (vii) of subsection 1006(a) of the Original Indenture is
hereby amended by adding at the end thereof the phrase "or liens existing at the
date of the original issuance of the Securities of a Series".

         8.  The current clause (xiii) of subsection 1006(a) of the Original
Indenture is renumbered as clause (xiv) and the following is added as clause
(xiii) of subsection 1006(a) of the Original Indenture:

             "(xiii) guarantees of indebtedness that are secured by a lien on
             Principal  Property located outside of the United States;"

         In addition, the reference in clause (xiii) of subsection 1006(a) of
the Original Indenture (now renumbered clause (xiv) of subsection 1006(a)
pursuant to this supplement) to clause (xii) shall be amended to be "this clause
(xiv)".

         9.  Clause (ii) of subsection 1006(b) of the Original Indenture is
deleted and replaced with the following:

             "(ii) "Consolidated Net Tangible Assets" means the total of
             all assets at their net book value (after deducting related
             depreciation, depletion, amortization and all other valuation
             reserves which, in accordance with generally accepted
             accounting principles, should be set aside in connection with
             the business conducted) after deducting therefrom (A) all
             current liabilities and (B) the value of all goodwill,
             tradenames, trademarks, patents and other intangible assets,
             in each case net of applicable amortization, as appearing on
             a consolidated balance sheet of the Company and its
             consolidated Subsidiaries, prepared in accordance with
             generally accepted accounting principles."

        10.  Clause (iii) of  subsection  1006(b) o of the Original  Indenture
is amended by inserting  after the word "means" the following:  ", without
duplication." In addition,  the following shall be inserted in the provision of
clause (iii) of subsection (b), after the phrase "shall not include:"

                                       3

<PAGE>

             "any guarantee of indebtedness secured by a lien on a
             Principal Property located outside of the United States or
             any guarantee by any Restricted Subsidiary the primary assets
             of which are Principal Properties located outside of the
             United States, or".

        11.  Clause (iv) of subsection 1006(b) of the Original Indenture is
deleted and replaced with the following:

             "(iv) Principal Property" means any manufacturing plant,
             research facility or warehouse owned or leased by the Company
             or any Restricted Subsidiary which has a net book value
             exceeding 2.5% of Consolidated Net Tangible Assets, but not
             including (1) any property which in the opinion of the
             Company is not of material importance to the total business
             conducted by the Company as an entirety or (2) any portion of
             a particular property which is similarly found not to be of
             material importance to the use or operation of such
             property."

        12.  The following is added at the end of Section 1006 of the Original
Indenture as a new subsection (c):

             "(c) For purposes of this Section 1006, the giving of a
             guarantee which is secured by a lien on a Principal Property
             (including shares of capital stock or indebtedness), other
             than a Principal Property located outside of the United
             States, of a Restricted Subsidiary, and the creation of a
             lien on a Principal Property (including shares of capital
             stock or indebtedness) of the Company or any Restricted
             Subsidiary to secure indebtedness which existed prior to the
             creation of such lien, shall be deemed to involve the
             creation of indebtedness in an amount equal to, with
             duplication, the principal amount secured by such lien."

        13. In the second line of Section 1007 of the Original Indenture, the
words "after the date of this Original Indenture" are inserted before the word
"enter."

        14.  Section 1008 of the Original Indenture is deleted and replaced with
the following:

             "Section 1008. Exemption from Limitation on Liens and Sale and
             Lease-Back Transactions.

             Notwithstanding the provisions of Sections 1006, 1007 and 1009,
             the Company or any Restricted Subsidiary may, without equally
             and ratably securing the Outstanding Securities, create, incur,
             assume or guarantee indebtedness secured by liens and enter into
             Sale and Lease-Back Transactions which would otherwise be
             restricted by such provisions, provided that at the time such
             indebtedness secured by liens is created, incurred, assumed or
             guaranteed or such Sale and Lease-Back transaction is entered
             into (and after giving effect to the transactions, to the
             receipt and

                                       4

<PAGE>

             application of the net proceeds thereof and the retirement of
             any indebtedness which is concurrently being retired out of such
             proceeds) the sum of the aggregate indebtedness secured by such
             liens plus the Attributable Debt of all Sale and Lease-Back
             Transactions then outstanding shall not exceed 10% of
             Consolidated Net Tangible Assets, as determined in accordance
             with the most recent published consolidated balance sheet of the
             Company."

        15. The Original Indenture is hereby amended by deleting the term
"James River Corporation of Virginia" and replacing it with the term "Fort James
Corporation" in each place in which such term appears in Exhibits A through G.1
to the Original Indenture. Likewise, the cover page to the Original Indenture
and the reference table listing "Certain Sections of this Indenture relating to
Section 310 through 318 of the Trust Indenture Act of 1939" are hereby amended
by deleting the term "James River Corporation of Virginia" and replacing it with
the term "Fort James Corporation" in each place in which such term appears.

                                   ARTICLE TWO

         1. All terms used in this Supplemental Indenture which are defined in
the Original Indenture and not otherwise defined herein shall have the meanings
assigned to such terms in the Original Indenture.

         2. All of the provisions of this Supplemental Indenture shall be deemed
to be incorporated in, and made a part of, the Original Indenture; and the
Original Indenture, as supplemented by this Supplemental Indenture, shall be
read, taken and construed as one and the same instrument and shall be binding
upon all the Holders of Securities of any series originally issued after the
date hereof.

         3. This Supplemental Indenture may be executed in any number of
counterparts, each of which so executed shall be deemed to be an original, but
all such counterparts shall together constitute but one and same instrument.

         4. All covenants and agreements in this Supplemental Indenture by the
Company and the Trustee shall bind their respective successors and assigns,
whether so expressed or not.

         5. In case any provision in this Supplemental Indenture shall be
invalid, illegal or unenforceable, the validity, legality and enforceability of
the remaining provisions shall not in any way be affected or impaired thereby.

         6. Nothing in this Supplemental Indenture, express or implied, shall
give any person, other than the parties hereto and their successors hereunder
and the Holders of Securities of any series originally issued after the date
hereof, any benefit or any legal or equitable right, remedy or claim under this
Supplemental Indenture. This Supplemental Indenture only applies to series of
Securities originally issued after the date hereof. Except as expressly
supplemented or amended as set forth in this Supplemental Indenture, the
Original Indenture is hereby ratified and confirmed, and all the terms,
provisions and conditions thereof shall be and continue in full force

                                       5

<PAGE>

and effect. The Trustee accepts the trusts created by the Original Indenture, as
amended and supplemented by this Supplemental Indenture, and agrees to perform
the same upon the terms and conditions in the Original Indenture as amended and
supplemented by this Supplemental Indenture.

         7. This Supplemental Indenture shall be construed and governed by and
in accordance with the laws of the State of New York without regard to its
conflict of laws principles.

                                       6

<PAGE>

         IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed, all as of the date and year first above written.

                                            FORT JAMES CORPORATION

                                            By:  /s/ Clifford A. Cutchins, IV
                                                 ------------------------------
                                                 Name:  Clifford A. Cutchins, IV
                                                 Title:  Sr. Vice President

(Seal)

Attest:

/s/ Susan O. Self
------------------------------------
Name:  Susan O. Self
Title:  Assistant Corporate Secretary

                                            THE BANK OF NEW YORK

                                            By:  /s/ Mary LaGumina
                                                 -----------------------------
                                                 Name:  Mary LaGumina
                                                 Title:  Asst. Vice President

                                       7

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