The student pilot and his flight instructor took off from their home airport and proceeded to an outlying airport to practice landings and takeoffs. After the student demonstrated a touch and go landing, as the airplane climbed through approximately 150 feet above ground level the engine lost power. The flight instructor then took control of the airplane, and attempted to trouble shoot the loss of power while executing a turn to the right as the forested area off the end of the runway precluded landing straight ahead. The airplane then descended below the tops of the trees and the flight instructor attempted to follow an S-turn in a road and land in an area free from obstructions. Midway through the turn however, the airspeed began to degrade and the airplane began to stall. The flight instructor then reduced angle of attack to keep from stalling and losing control and allowed the left wing to come in contact with a tree. The airplane then yawed to the left, the right wing then contacted trees, and the airplane impacted the ground. Post accident examination by a Federal Aviation Administration inspector revealed that the exhaust valve for the No.1 cylinder was stuck in the open position which was consistent with the engine's loss of power.