“That’s all right,” said John reading the agreement. “We are going to add a dollar a keg to nails. This phrase—‘unless the party of the second part,’ (that’s Gib), ‘wishes to sell nails at a lower price to the trade’—who put that in?”
“He did,” said Awns. “I couldn’t see any point in objecting to it. No man is going to undersell his own contract.”
John handed the agreement back and sat for several minutes musing.
“There’s a loose wheel in your scheme, if I’m not mistaken,” said Awns. “If you add a dollar a keg to nails won’t you bring in a lot of new competition? Anybody can make nails if it pays. These same people who sell out to you may turn around and begin again. You’ll be holding the umbrella for everybody else.”
“Anybody can’t make nails,” said John. “I’ve looked at that.”
“Why not?”
“Nail making machines are covered by patents. There are only four firms that make them. I’ve made air tight contracts with them. We take all their machines at an advance of twenty-five per cent. over present prices and they bind themselves to sell machines to nobody else during the life of the contract. So we’ve got the bag sewed up top and bottom. They were glad to do it because there isn’t any profit in machines either with the nail makers all going busted.”
Awns stared at him with doubt and admiration mingled.
“Well, that is showing them something,” he said. “If you go far with that kind of thing laws will be passed to stop it.”
“It’s legal, isn’t it?”