DEVELOPMENT OF PULP WOOD KESOUKCES. 31 



Except as hereinafter provided, material below merchantable 

 size under the terms of this agreement which is cut and removed 

 at the option of the purchaser shall be paid for at the rates then 

 in effect for merchantable material. Material unmerchantable on 

 account of defects may be removed without charge in the discre- 

 tion of the district forester. 



(b) The Forester shall reappraise and within thirty days 

 before each of the foregoing dates designate the value of each 

 species in consideration of current operating conditions and 

 markets in southeastern Alaska, including the operation of the 

 purchaser, such reappraisals to include the timber on the entire 

 tract, and to be based upon an equitable margin for profit and 

 risk to the purchaser under the operating conditions prevailing 

 throughout the region : Provided, That the stumpage price for 

 any species fixed upon any reappraisal date shall not exceed the 

 arithmetical average of the prices received for National Forest 

 stumpage of that species in southeastern Alaska during the 

 twelve months preceding the date of reappraisal, as shown by sale 

 contracts executed during that period ; and 



Provided further, That in no event shall the stumpage price 

 for any species established by the Forester to apply during the 

 period from April 1, 1928, to April 1, 1933, exceed double the 

 initial rate for that species as stated above. 



(c) If any material cut under this agreement and merchant- 

 able under its terms is manufactured or sold by the purchaser 

 for other uses than pulp or its products, the Forester may upon 

 the next reapparisal date establish a special stumpage rate for 

 each class of material so manufactured or sold during the suc- 

 ceeding period, which rate, in accordance with the ratio per one 

 hundred cubic feet currently used by the Forest Service, shall 

 be not less than the initial stumpage price fixed herein and shall 

 allow the purchaser an equitable margin for profit and risk under 

 current selling prices and costs of production in the region defined 

 above. 



( d ) It is further agreed that the Secretary of Agriculture will, 

 upon written application from the purchaser showing good and 

 sufficient reasons therefor and specifically the existence of a seri- 

 ous emergency arising from changes in market conditions since 

 the last reappraisal, at his option, when action of either charac- 

 ter is necessary to relieve the purchaser from hardship, either— 



(1) Redetermine and establish the stumpage rates and desig- 

 nate a date when the rates as redetermined shall be effective, 

 which date shall be within six (6) months of the date of appli- 

 cation, or 



(2) Grant an extension of time within which the respective 

 amounts of timber specified in section 4 shall be removed, not to 

 exceed the total period allowed for cutting all the timber. 



Any stumpage rates redetermined upon application to the Sec- 

 retary shall be determined in accordance with the methods and 

 under the terms above set forth, and shall apply only during the 

 remainder of the five-year period then current, when the rates 

 shall be regularly designated after reappraisal, 



