172 



- 5 - 



cannot be justified. While the 44,000 acre proposal 

 encompasses most old growth redwood trees owned by Pacific 

 Lumber (and the other impacted landowners), it also sweeps 

 in substantial tracts of timberland that have been 

 successfully managed on a prudent basis and selectively 

 harvested for years. 



If, however, the government decides not to acquire 

 the 3,000 acre Headwaters Forest, then Pacific Lumber and 

 Maxxam have a legal responsibility to their stockholders 

 and other investors to proceed to obtain all requisite 

 permits required for the trees to be selectively harvested 

 and the property to be managed for its intended use. 



Let me hasten to say in the strongest possible terms 

 that we — both Pacific Lumber and Maxxam — are serious 

 about our willingness to acquiesce in an acquisition of 

 the Headwaters Forest and to work constructively toward 

 that end. This has been our position for some time. As 

 part of an accord reached in 1990, at the urging of key 

 local legislators. Pacific Lumber agreed not to harvest in 

 the 3,000-acre Headwaters Forest for two years. The 

 purpose of that voluntary moratorium, which has now 

 expired, was to allow environmental organizations time to 

 raise money from government and/or private sources to 

 acquire and preserve the property in its present form. 

 This has not occurred, despite the efforts of many. For 

 example, voters of the State of California rejected three 



