PORTLAND GENERAL HOLDINGS, INC.

                   RETIREMENT PLAN FOR OUTSIDE DIRECTORS

                             1997 RESTATEMENT




                                <PAGE>



                               TABLE OF CONTENTS

ARTICLE I-PURPOSE.........................................      1

  1.1 Purpose                                                   1
  1.2 Effective Date                                            1
  1.3 Plan Sponsor                                              1

ARTICLE II-DEFINITIONS....................................      1

  2.1 Actuarially Equivalent                                    1
  2.2 Benefit Service                                           1
  2.3 Board                                                     1
  2.4 Change in Control                                         2
  2.5 Committee                                                 2
  2.6 Company                                                   2
  2.7 Compensation                                              2
  2.8 Dependent                                                 3
  2.9 Direct Subsidiary                                         3
  2.10 Effective Date                                           3
  2.11 Indirect Subsidiary                                      3
  2.12 Marriage                                                 3
  2.13 Outside Director                                         3
  2.14 PGC Board..........................................      3
  2.15 Participant                                              4
  2.16 Participating Company                                    4
  2.17 Plan                                                     4
  2.18 Retirement Date                                          4
  2.19 Senior Administrative Officer                            4
  2.20 Spouse                                                   4
  2.21 Suspension Date                                          4
  2.22 Termination                                              4

ARTICLE III-RETIREMENT BENEFITS...........................      5

  3.1 Eligibility                                               5
  3.2 Benefit Upon Retirement                                   5
  3.3 Form of Benefit Payment                                   5
  3.4 Commencement of Payment                                   6

ARTICLE IV-BENEFITS AFTER CHANGE IN CONTROL ..............      6

  4.1 Benefit Upon a Change in Control                          6
  4.2 Form of Payment                                           6
  4.3 Commencement of Payment                                   7


                                  i
                                <PAGE>


ARTICLE V-SURVIVOR BENEFITS...............................      7

  5.1 Survivor Benefit                                          7
  5.2 Cessation of Benefit Upon Remarriage                      7

ARTICLE VI-ADMINISTRATION.................................      7

  6.1 Senior Administrative Officer; Duties                     7
  6.2 Agents                                                    7
  6.3 Binding Effect of Decisions                               8
  6.4 Indemnity of Senior Administrative Officer; Committee     8
  6.5 Availability of Plan Documents                            8
  6.6 Cost of Plan Administration                               8

ARTICLE VII-CLAIMS PROCEDURE..............................      8

  7.1 Claim                                                     8
  7.2 Denial of Claim                                           8
  7.3 Review of Claim                                           9
  7.4 Final Decision                                            9

ARTICLE VIII-AMENDMENT AND TERMINATION OF PLAN............      9

  8.1 Amendment                                                 9
  8.2 Termination                                               9

ARTICLE IX-MISCELLANEOUS.................................       9

  9.1 Unfunded Plan                                             9
  9.2 Liability                                                10
  9.3 Trust Fund                                               10
  9.4 Nonassignability                                         10
  9.5 Payment to Guardian                                      11
  9.6 Terms                                                    11
  9.7 Protective Provisions                                    11
  9.8 Governing Law                                            11
  9.9 Validity                                                 11
  9.10 Notice                                                  11
  9.11 Successors                                              12
  9.12 Not a Contract of Service                               12



                                  ii
                                <PAGE>


                              INDEX OF TERMS

TERM AND PROVISION NUMBER
 PAGE
A

Actuarial
Equivalent: 2.1                                                 1

B

Benefit Service: 2.2.                                           1
Board: 2.3                                                      1

C
Change in Control: 2.4  2
Committee: 2.5                                                  3
Company: 2.6                                                    3
Compensation: 2.7.                                              3

D
Dependent: 2.8                                                  3
Direct Subsidiary: 2.9                                          3

E
Effective Date: 2.10                                            3
Exchange Act: 2.4(a)                                            2

I
Indirect Subsidiary: 2.11                                       3

M
Marriage: 2.12                                                  3

O
Outside Director: 2.13                                          3

P
Participant: 2.14                                               4
Participating Company: 2.15                                     4
PGC: 2.4(a)                                                     2
PGE: 2.4(a)                                                     2
Plan: 2.16                                                      4

R
Retirement Date: 2.17                                           4



                                 iii
                                <PAGE>

S
Senior Administrative Officer: 2.18                             4
Spouse: 2.19                                                    4
Suspension Date: 2.20                                           4

T
Termination: 2.21                                               4



                                  iv
                                <PAGE>



                  PORTLAND GENERAL HOLDINGS, INC.

                   RETIREMENT PLAN FOR OUTSIDE DIRECTORS

                             1997 RESTATEMENT


                               ARTICLE I-PURPOSE

1.1  Purpose

   The Portland General Holdings, Inc. Retirement Plan for Outside
Directors is designed to enhance the Participating Companies' ability to
attract and retain competent and experienced Directors by providing
retirement benefits for certain Directors who retire after the Effective
Date. The Plan first became effective on January 1, 1985 and was amended by
the 1990 and 1996 Restatements.

1.2  Effective Date

   This 1997 Restatement is effective June 25, 1997.

1.3  Plan Sponsor

   The Plan is maintained for the benefit of previous Outside Directors of
Portland General Corporation, an Oregon corporation, and Outside Directors
of any corporations or other entities affiliated with or subsidiary to it,
if such corporations or entities are selected by the Board.


                            ARTICLE II-DEFINITIONS

2.1  Actuarially Equivalent

   "Actuarially Equivalent" shall mean the equivalence in value between two
(2) or more forms and/or times of payment based upon a determination by an
actuary chosen by the Senior Administrative Officer using a discount rate
equal to the 30-year Treasury Bill rate on the January 1st of the year in
which the determination occurs plus one percent (1%) and the unisex
mortality table chosen by the actuary, which choice shall be binding on all
parties.

2.2  Benefit Service

   "Benefit Service" shall mean the continuous amount of time, in completed
months, as an Outside Director. Benefit Service shall commence on the
Outside Director's first election to the Board as an Outside Director and
shall end at the last Board or committee meeting the Outside Director
attends. Concurrent service on more than one Participating Company's Board
shall be counted only once as actual months of service.


PAGE 1 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

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2.3  Board

   "Board" shall mean the Board of Directors of Portland General Holdings,
Inc.

2.4  Change in Control

   A "Change in Control" shall mean:

      (a) Any "person," as such term is used in Sections 13(d) and 14(d) of
   the Securities Exchange Act of 1934, as amended (the "Exchange Act")
   (other than Portland General Holdings, Inc. ("PGH"), any trustee or
   other fiduciary holding securities under an employee benefit plan of
   PGH, or any Employer owned, directly or indirectly, by the stockholders
   of PGH in substantially the same proportions as their ownership of stock
   of PGH), is or becomes the "beneficial owner" (as defined in Rule 13d-3
   under the Exchange Act), directly or indirectly, of securities
   representing thirty percent (30%) or more of the combined voting power
   of PGH's then outstanding voting securities; or

      (b) During any period of two (2) consecutive years (not including any
   period prior to the execution of this Agreement), individuals who at the
   beginning of such period constitute the Board, and any new director
   whose election by the Board or nomination for election by PGH's
   stockholders was approved by a vote of at least two-thirds (2/3) of the
   directors then still in office who either were directors as of the
   beginning of the period of whose election or nomination for election was
   previously so approved, cease for any reason to constitute at least a
   majority thereof.

      (c) Notwithstanding anything to the contrary in the foregoing, no
   "Change in Control" shall be deemed to have occurred upon the
   consummation of the Amended and Restated Agreement and Plan of Merger by
   and among Enron Corp., Portland General Corporation and Enron Oregon
   Corp., dated as of July 20, 1996, or amended and restated from time to
   time (the "Merger Agreement").

2.5  Committee

   "Committee" shall mean the Non-Qualified Benefits Committee of the
Board.

2.6  Company

   "Company" shall mean Portland General Holdings, Inc., an Oregon
Corporation.

2.7  Compensation

   "Compensation" shall mean the greater of actual annual retainer and fees
for attendance at PGC Board and various committee meetings that the Outside
Director earned in the last 12 months of Benefit Service, or one-third
(1/3) of the total annual retainer and fees earned in the last thirty-six
(36) months of Benefit Service.


PAGE 2 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

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2.8  Dependent

   "Dependent" shall mean an unmarried child of the Outside Director until
the age of nineteen (19) (age twenty-six (26) if a full-time student). An
unmarried child shall also qualify as a Dependent by reason of mental
retardation or physical handicap for as long as the condition exists, if
such child qualifies as a dependent under regulations set forth by the
Internal Revenue Service by reason of such mental retardation or physical
handicap.

2.9  Direct Subsidiary

   "Direct Subsidiary" means any corporation of which a Participating
Company owns at least eighty percent (80%) of the total combined voting
power of all classes of its stock entitled to vote.

2.10 Effective Date

   "Effective Date" shall mean June 25, 1997.

2.11 Indirect Subsidiary

   "Indirect Subsidiary" means any corporation of which a Participating
Company directly and constructively owns at least eighty percent (80%) of
the total combined voting power of all classes of its stock entitled to
vote. In determining the amount of stock of a corporation that is
constructively owned by a Participating Company, stock owned, directly or
constructively, by a corporation shall be considered as being owned
proportionately by its shareholders according to such shareholders' share
of voting power of all classes of its stock entitled to vote.

2.12 Marriage

   "Marriage" shall mean the Marriage or Remarriage of a Participant prior
to their separation from service on the Board.

2.13 Outside Director

   "Outside Director" shall mean a member of the PGC Board who is not an
employee of Portland General Holdings, Inc. or any Direct Subsidiary or
Indirect Subsidiary or affiliate of Portland General Holdings, Inc..

2.14 PGC Board

     "PGC Board" shall mean the Board of Directors of Portland General
Corporation, or the Board of Directors of the successor corporation
established pursuant to the Merger Agreement as defined in Section 2.4(c),
or any Advisory Committee to the Portland General Electric Company or the
board or officers of a corporation qualifying as a Participating Company of
the Plan, including subsidiaries and joint venture partners, the status of
which shall be determined at the discretion of the Senior Administrative
Office.


PAGE 3 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

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2.15 Participant

   "Participant" shall mean any eligible Outside Director elected to the
PGC Board prior to the Suspension Date.

2.16 Participating Company

   "Participating Company" shall mean the Company or any affiliated or
subsidiary company designated by the Board as a Participating Company under
the Plan, as long as such designation has become effective and continues to
be in effect. The designation as a Participating Company shall become
effective only upon acceptance of such designation and the formal adoption
of the Plan by a Participating Company. A Participating Company may revoke
its acceptance of designation as a Participating Company at any time, but
until it makes such revocation, all of the provisions of this Plan and any
amendments thereto shall apply to the Outside Directors of the
Participating Company and their Beneficiaries.

2.17 Plan

   "Plan" shall mean the Portland General Holdings, Inc. Retirement Plan
for Outside Directors.

2.18 Retirement Date

   "Retirement Date" shall mean the first day of the month coincident with
or next following the date of separation from service as an Outside
Director, other than by death, after the earlier of age seventy (70) or ten
(10) years of Benefit Service.

2.19 Senior Administrative Officer

   "Senior Administrative Officer" shall mean the employee in the
management position designated by the Committee to administer the Plan.

2.20 Spouse

   "Spouse" shall mean the person to whom the Outside Director was legally
married at the Outside Director's date of death.

2.21 Suspension Date

   "Suspension Date" shall mean January 1, 1996.

2.22 Termination

   "Termination" shall mean removal from the PGC Board by shareholders
during a current term of office.


PAGE 4 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

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                        ARTICLE III-RETIREMENT BENEFITS

3.1  Eligibility

   Each Participant who reaches a Retirement Date on or after the Effective
Date shall be eligible for retirement benefits under this Plan.  Benefits
shall be payable to such Participant under this Plan when the Participant
no longer serves on the PGC Board.

3.2  Benefit Upon Retirement

      (a) The annual benefit payable under this Plan shall equal five
   percent (5%) of Compensation for each of the first ten (10) years of
   Benefit Service plus two and one-half percent (2.5%) of Compensation for
   each of the next ten (10) years of Benefit Service up to a maximum
   benefit of seventy-five percent (75%) of Compensation for years of
   Benefit Service completed prior to the Suspension Date. No further
   accruals shall be made following the Suspension Date.

      (b) All Participants shall be vested in their accrued benefit as of
   the Suspension Date.

3.3  Form of Benefit Payment

   The benefits shall be paid in the form elected by the Participant at the
time the Outside Director becomes a Participant in the Plan. Except in the
case of Marriage of a Participant (in which case a Participant may
reelect), this election shall be made one time and shall be irrevocable.
The election shall be in the form prescribed by the Company and filed with
the Senior Administrative Officer. The following options shall be
available:

      (a) If the Participant is unmarried as of the Retirement Date, the
   benefit shall be paid:

          (i) As a straight life annuity; or

          (ii) Over a length of time equal to the lesser of the Outside
      Director's Benefit Service or the Outside Director's lifetime.

      (b) If the Participant is married as of the Retirement Date, the
   benefit may be paid:

          (i) As a straight life annuity; or

          (ii) As a fifty percent (50%) joint and survivor annuity; or

          (iii) As a one hundred percent (100%) joint and survivor annuity;
      or

          (iv) Over a period of time equal to the Outside Director's
      Benefit Service so long as the Outside Director  or Spouse is living;
      or



PAGE 5 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

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          (v) Over a length of time equal to the lesser of the Outside
      Director's Benefit Service or the Outside Director's lifetime, or
      upon death, survivor benefit payable for the lesser of Spouse's life,
      twelve (12) months, or Outside Director's Benefit Service.

   Benefits paid in a form other than pursuant to Section 3.3(a)(ii) or
(b)(v) shall be calculated on an Actuarially Equivalent basis. In the event
an election is not on file at the time benefit payments commence, benefits
shall be paid as a straight life annuity if the Participant is unmarried or
a fifty percent (50%) joint and survivor annuity if the Participant is
married. One-twelfth (1/12) of the annual benefit shall be payable monthly
on the first day of each month.

      (c) If the benefit to be paid is less than ten thousand dollars
   ($10,000) as of the Suspension Date, a lump-sum payment shall be paid
   notwithstanding the form elected.

3.4  Commencement of Payment

   Benefit payments shall commence within thirty (30) days following
separation from service on the Board.


                  ARTICLE IV-BENEFITS AFTER CHANGE IN CONTROL

4.1  Benefit Upon a Change in Control

   Upon the Termination of a Participant within three (3) years following a
Change in Control, the following shall apply to the benefits for each
Participant who is an Outside Director at the time such Change in Control
occurs:

      (a) A benefit shall be payable regardless of the Outside Director's
   Benefit Service, Retirement Date, or age.

      (b) The annual benefit payable shall equal five percent (5%) of
   Compensation for each of the first ten (10) years of Benefit Service
   plus two and one-half percent (2.5%) of Compensation for each of the
   remaining years of Benefit Service, up to ten (10) years of Benefit
   Service, for years of Benefit Service completed prior to the Suspension
   Date, except that the Participant's total benefit shall not exceed
   seventy-five percent (75%) of Compensation.

4.2  Form of Payment

   A benefit, Actuarially Equivalent to the benefit payable over the lesser
of twenty (20) years or years of service on the Board as computed under
4.1(c), shall be paid in a lump sum.



PAGE 6 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

                                <PAGE>


4.3  Commencement of Payment

   Benefit payment shall be made within sixty (60) days following
Termination of the Outside Director.


                          ARTICLE V-SURVIVOR BENEFITS

5.1  Survivor Benefit

   If an Outside Director, who is eligible for a retirement benefit, dies
while serving on the PGC Board, a survivor's benefit equal to the
Participant's monthly Retirement benefit shall be paid to the Spouse of the
Outside Director. Such benefit shall be the Actuarially Equivalent amount
payable under this Plan, as of the Suspension Date, as if the Outside
Director had retired on the first day of the month in which he or she died
and had been receiving the benefit as elected under Section 3.3 (b) (ii),
(iii), (iv), or (v).

5.2  Cessation of Benefit Upon Remarriage

   In the event a Spouse receiving benefits under this Plan remarries, such
Spouse will stop receiving, as of the date of remarriage, any further
monthly benefits from this Plan . However, in lieu of any further monthly
benefits from this Plan, a Spouse will receive the lesser of the remaining
monthly benefits or six (6) months of benefits in a lump sum within forty-
five (45) days from the date of such remarriage. In the event the Senior
Administrative Officer is not notified of such remarriage within six (6)
months, no benefit shall be payable under this Section.


                           ARTICLE VI-ADMINISTRATION

6.1  Senior Administrative Officer; Duties

   This Plan shall be administered by the Senior Administrative Officer, as
designated by the Committee. Members of the Committee may be Participants
under this Plan. The Senior Administrative Officer shall have the authority
to make, amend, interpret and enforce all appropriate rules and regulations
for the administration of this Plan and decide or resolve any and all
questions including interpretations of this Plan as may arise in connection
with the Plan. The Senior Administrative Officer shall report to the
Committee on an annual basis regarding Plan activity and at such other
times as may be requested by the Committee.


6.2  Agents

   In the administration of the Plan, the Senior Administrative Officer
may, from time to time, employ agents and delegate to such agents,
including employees of any Participating Company, such administrative
duties as it sees fit, and may, from time to time, consult with counsel,
who may be counsel to any Participating Company.


PAGE 7 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

                                <PAGE>


6.3  Binding Effect of Decisions

   The decision or action of the Senior Administrative Officer with respect
to any question arising out of or in connection with the administration,
interpretation and application of the Plan and the rules and regulations
promulgated hereunder shall be final and conclusive and binding upon all
persons having any interest in the Plan.

6.4  Indemnity of Senior Administrative Officer; Committee

   Each Participating Company shall indemnify and hold harmless the Senior
Administrative Officer and the Committee and its individual members against
any and all claims, loss, damage, expense or liability arising from any
action or failure to act with respect to this Plan, except in the case of
gross negligence or willful misconduct.

6.5  Availability of Plan Documents

   Each Participant shall receive a copy of this Plan, and the Senior
Administrative Officer shall make available for inspection by any
Participant a copy of the rules and regulations used in administering the
Plan.

6.6  Cost of Plan Administration

   The Company shall bear all expenses of administration. However, a
ratable portion of the expense shall be charged back to each Participating
Company.


                         ARTICLE VII-CLAIMS PROCEDURE

7.1  Claim

   Any person claiming a benefit, requesting an interpretation or ruling
under the Plan or requesting information under the Plan shall present the
request in writing to the Senior Administrative Officer or his delegatee
who shall respond in writing as soon as practicable.

7.2  Denial of Claim

   If the claim or request is denied, the written notice of denial shall
state:

      (a) The reasons for denial, with specific reference to the Plan
   provisions on which the denial is based.

      (b) A description of any additional material or information required
   and an explanation of why it is necessary.

      (c) An explanation of the Plan's claim review procedure.


PAGE 8 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

                                <PAGE>


7.3  Review of Claim

   Any person whose claim or request is denied or who has not received a
response within thirty (30) days may request review by notice given in
writing to the Senior Administrative Officer. The claim or request shall be
reviewed by the Senior Administrative Officer, who may, but shall not be
required to, grant the claimant a hearing. On review, the claimant may have
representation, examine pertinent documents and submit issues and comments
in writing.

7.4  Final Decision

   The decision of the Senior Administrative Officer on review shall
normally be made within sixty (60) days. If an extension of time is
required for a hearing or other special circumstances, the claimant shall
be notified and the time limit shall be one hundred twenty (120) days. The
decision shall be in writing and shall state the reasons and relevant Plan
provisions. All decisions on review shall be final and bind all parties
concerned.


                ARTICLE VIII-AMENDMENT AND TERMINATION OF PLAN

8.1  Amendment

   The Senior Administrative Officer may amend the Plan from time to time
as may be necessary for administrative purposes and legal compliance,
provided, however, that no such amendment shall affect the benefit rights
of Participants or Beneficiaries in the Plan. The Committee may amend the
Plan at any time, provided, however, that no amendment shall be effective
to decrease or restrict the rights of Participants and Beneficiaries to the
benefit accrued at the time of the amendment.

8.2  Termination

   The board of directors of each Participating Employer may at any time,
in its sole discretion, terminate or suspend the Plan in whole or in part
for that Participating Employer. However, no such termination or suspension
shall adversely affect the benefits of Participants which have accrued
prior to such action, the benefits of any Participant who has previously
retired, the benefits of any Beneficiary of a Participant who has
previously died, or already accrued Plan liabilities between Participating
Employers.


                           ARTICLE IX-MISCELLANEOUS

9.1  Unfunded Plan

     This Plan is intended to be an unfunded plan maintained primarily to
provide deferred compensation benefits for a select group of Outside
Directors.


PAGE 9 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

                                <PAGE>

9.2  Liability

          (a) Liability of Benefits.  Except as otherwise provided in this
     paragraph, liability for the payment of a Participant's benefit
     pursuant to this Plan shall be borne solely by the Participating
     Company for which the Participant serves during the accrual or
     increase of the Plan benefit, and no liability for the payment of any
     Plan benefit shall be incurred by reason of Plan sponsorship or
     participation except for the Plan benefits of a Participating
     Company's own Outside Directors. Provided, however, that each
     Participating Company, by accepting the Board's designation as a
     Participating Company under the Plan and formally adopting the Plan,
     agrees to assume secondary liability for the payment of any benefit
     accrued or increased while a Participant serves on the board of
     directors of a Participating Company that is a Direct Subsidiary or
     Indirect Subsidiary of the Participating Company at the time such
     benefit is accrued or increased. Such liability shall survive any
     revocation of designation as a Participating Employer with respect to
     any liabilities accrued at the time of such revocation. Nothing in
     this paragraph shall be interpreted as prohibiting any Participating
     Company or any other person from expressly agreeing to the liability
     for a Plan Participants' payment of any benefits under the Plan.

          (b) Unsecured General Creditor.  Participants of this Plan, and
     any Spouse, Dependents, heirs, successors, and assigns shall have no
     secured legal or equitable rights, interest or claims in any property
     or assets of Participating Company, nor shall they be beneficiaries
     of, or have any rights, claims or interests in any life insurance
     policies, annuity contracts or the proceeds therefrom owned or which
     may be acquired by Participating Company. Except as provided in
     Section 9.3, such policies, annuity contracts or other assets of
     Participating Company shall not be held under any trust for the
     benefit of any Participant, Spouse, Dependents, heirs, successors or
     assigns, or held in any way as collateral security for the fulfilling
     of the obligations of Participating Company under this Plan. Any and
     all of Participating Company's assets and policies shall be, and
     remain, the general, unpledged, unrestricted assets of Participating
     Company. Participating Company's obligation under the Plan shall be
     that of an unfunded and unsecured promise to pay money in the future.

9.3  Trust Fund

   At its discretion, each Participating Company, jointly or severally, may
establish one or more trusts, with such trustees as the Board may approve,
for the purpose of providing for the payment of such benefits. Such trust
or trusts may be irrevocable, but the assets thereof shall be subject to
the claims of Participating Company's creditors. To the extent any benefits
provided under the Plan are actually paid from any such trust,
Participating Company shall have no further obligation with respect
thereto, but to the extent not so paid, such benefits shall remain the
obligation of, and shall be paid by, Participating Company.

9.4  Nonassignability

   Neither a Participant of this Plan nor any other person shall have any
right to sell, assign, transfer, pledge, anticipate, mortgage or otherwise
encumber, hypothecate or convey in advance of actual receipt the amounts,
if any, payable hereunder, or any part thereof, which are, and all


PAGE 10 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

                                <PAGE>


rights to which are, expressly declared to be nonassignable and
nontransferable.
No part of the amount payable shall, prior to actual payment, be subject to
seizure or sequestration for the payment of any debts, judgments, alimony
or separate maintenance owed by a Participant or any other person, nor be
transferable by operation of law in the event of a Participant's or any
other person's bankruptcy or insolvency.

9.5  Payment to Guardian

   If a Plan benefit is payable to a minor or a person declared incompetent
or to a person incapable of handling the disposition of property, the
Senior Administrative Officer may direct payment of such Plan benefit to
the guardian, legal representative or person having the care and custody of
such minor or incompetent person. The Senior Administrative Officer may
require proof of incompetency, minority, incapacity or guardianship as he
may deem appropriate prior to distribution of the Plan benefit. Such
distribution shall completely discharge the Senior Administrative Officer,
the Committee and the Company from all liability with respect to such
benefit.

9.6  Terms

   In this Plan document, unless the context clearly indicates the
contrary, the masculine gender will be deemed to include the feminine
gender, and the singular shall include the plural.

9.7  Protective Provisions

   A Participant shall cooperate with Participating Company by furnishing
any and all information requested by Participating Company, in order to
facilitate the payment of benefits hereunder, and by taking such physical
examinations as Participating Company may deem necessary and taking such
other action as may be requested by Participating Company.

9.8  Governing Law

   The provisions of this Plan shall be construed and interpreted according
to the laws of the State of Oregon, except as preempted by federal law.

9.9  Validity

   If any provision of this Plan shall be held illegal or invalid for any
reason, said illegality or invalidity shall not affect the remaining parts
hereof, but this Plan shall be construed and enforced as if such illegal
and invalid provision had never been inserted herein.

9.10 Notice

   Any notice or filing required or permitted to be given to the Senior
Administrative Officer under the Plan shall be sufficient if in writing and
hand delivered, or sent by registered or certified mail, to the Senior
Administrative Officer or the Secretary of Company. Notice, if mailed,
shall be addressed to the principal executive offices of Company. Notice
mailed to the Participant shall be at such address as is given in the
records of the Company. Such notice shall


PAGE 11 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

                                <PAGE>

be deemed given as of the date of
delivery or, if delivery is made by mail, as of the date shown on the
postmark on the receipt for registration or certification.

9.11 Successors

   The provisions of this Plan shall bind and inure to the benefit of
Participating Company and its successors and assigns. The term successors
as used herein shall include any corporate or other business entity which
shall, whether by merger, consolidation, purchase or otherwise, acquire all
or substantially all of the business and assets of Participating Company,
and successors of any such corporation or other business entity.

9.12 Not a Contract of Service

   The terms and conditions of this Plan shall not be deemed to constitute
a contract of service between a Participating Company and a Participant,
and neither a Participant nor a Participant's Spouse or Dependent shall
have any rights against a Participating Company except as may otherwise be
specifically provided herein. Moreover, nothing in this Plan shall be
deemed to give a Participant the right to be retained on the Board of a
Participating Company nor shall it interfere with the Participant's right
to terminate his directorship at any time.

   IN WITNESS WHEREOF, the Company has caused this instrument to be
executed by its officers thereunto duly recognized, this 5th day of
September, 1997.


                       PORTLAND GENERAL HOLDINGS, INC.



                       By: /s/ Don F. Kielblock


                       Its:   Vice President



PAGE 12 - RETIREMENT PLAN FOR OUTSIDE DIRECTORS

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