PORTLAND GENERAL HOLDINGS, INC.

                   MANAGEMENT DEFERRED COMPENSATION PLAN

                             1997 RESTATEMENT






                                   <PAGE>

                             TABLE OF CONTENTS


                                                           PAGE


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

  1.1 Restatement .........................................  1
  1.2 Purpose .............................................  1
  1.3 Effective Date ......................................  1
  1.4 Plan Sponsor ........................................  1

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

  2.1 Account .............................................  1
  2.2 Base Salary .........................................  2
  2.3 Beneficiary .........................................  2
  2.4 Board ...............................................  2
  2.5 Bonuses .............................................  2
  2.6 Change in Control ...................................  2
  2.7 Committee ...........................................  3
  2.8 Company .............................................  3
  2.9 Compensation ........................................  3
  2.10 Deferral Election ..................................  3
  2.11 Determination Date .................................  3
  2.12 Direct Subsidiary ..................................  3
  2.13 Eligible Employee ..................................  4
  2.14 Financial Emergency ................................  4
  2.15 Incentive Compensation .............................  4
  2.16 Indirect Subsidiary ................................  4
  2.17 Interest ...........................................  5
  2.18 Paid Time Off ......................................  5
  2.19 Paid Time Off Cancellation .........................  5
  2.20 Participant ........................................  5
  2.21 Participating Employer .............................  5
  2.22 Pension Plan .......................................  5
  2.23 Plan ...............................................  5
  2.24 Policies ...........................................  6
  2.25 President ..........................................  6
  2.26 Senior Administrative Officer ......................  6

ARTICLE III-ELIGIBILITY AND DEFERRALS .....................  6

  3.1 Eligibility .........................................  6
  3.2 Deferral Elections ..................................  6
  3.3 Limits on Elective Deferrals ........................  7
  3.4 Matching Contributions ..............................  7
  3.5 Welfare Benefits ....................................  7


                                 i
                               <PAGE>

                          TABLE OF CONTENTS

                                                           PAGE


ARTICLE IV-DEFERRED COMPENSATION ACCOUNT ..................  7

  4.1 Crediting to Account ................................  7
  4.2 Determination of Accounts ...........................  8
  4.3 Vesting of Accounts .................................  8
  4.4 Statement of Accounts ...............................  8

ARTICLE V-PLAN BENEFITS ...................................  8

  5.1 Benefits ............................................  8
  5.2 Withdrawals for Financial Emergency .................  9
  5.3 Form of Benefit Payment .............................  9
  5.4 Accelerated Distribution ............................ 10
  5.5 Withholding; Payroll Taxes .......................... 11
  5.6 Commencement of Payments ............................ 11
  5.7 Full Payment of Benefits ............................ 11
  5.8 Payment to Guardian ................................. 11

ARTICLE VI-RESTORATION OF PENSION PLAN BENEFITS ........... 11

  6.1 Pension Plan ........................................ 11
  6.2 Restoration of Pension Plan Benefits ................ 11
  6.3 Restoration of Pension Plan Benefits in Event of
      Change in Control ................................... 12

ARTICLE VII-BENEFICIARY DESIGNATION ....................... 12

  7.1 Beneficiary Designation ............................. 12
  7.2 Amendments .......................................... 12
  7.3 No Beneficiary Designation .......................... 13
  7.4 Effect of Payment ................................... 13

ARTICLE VIII-ADMINISTRATION ............................... 13

  8.1 Senior Administrative Officer; Duties ............... 13
  8.2 Agents .............................................. 13
  8.3 Binding Effect of Decisions ......................... 13
  8.4 Indemnity of Senior Administrative Officer;
      Committee ........................................... 13
  8.5 Availability of Plan Documents ...................... 14
  8.6 Cost of Plan Administration ......................... 14

                                   ii

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                           TABLE OF CONTENTS



                                                           PAGE

ARTICLE IX-CLAIMS PROCEDURE ............................... 14

  9.1 Claim ............................................... 14
  9.2 Denial of Claim ..................................... 14
  9.3 Review of Claim ..................................... 14
  9.4 Final Decision ...................................... 14

ARTICLE X-AMENDMENT AND TERMINATION OF PLAN ............... 15

  10.1 Amendment .......................................... 15
  10.2 Termination ........................................ 15
  10.3 Payment at Termination ............................. 15

ARTICLE XI-MISCELLANEOUS .................................. 15

  11.1 Unfunded Plan ...................................... 15
  11.2 Liability .......................................... 16
  11.3 Trust Fund ......................................... 16
  11.4 Nonassignability ................................... 17
  11.5 Not a Contract of Employment ....................... 17
  11.6 Protective Provisions .............................. 17
  11.7 Governing Law ...................................... 17
  11.8 Terms .............................................. 17
  11.9 Validity ........................................... 17
  11.10 Notice ............................................ 18
  11.11 Successors ........................................ 18



                                  iii
                                <PAGE>

                            INDEX OF TERMS



TERM AND PROVISION NUMBER                                  PAGE


A

Account:  2.1 .............................................  1

B

Base Salary:  2.2 .........................................  2
Beneficiary:  2.3 .........................................  2
Board:  2.4 ...............................................  2
Bonuses:  2.5 .............................................  2

C

Change in Control:  2.6 ...................................  2
Committee:  2.7 ...........................................  3
Company:  2.8 .............................................  3
Compensation:  2.9 ........................................  3

D

Deferral Election:  2.10 ..................................  3
Determination Date:  2.11 .................................  3
Direct Subsidiary:  2.12 ..................................  3

E

Eligible Employee:  2.13 ..................................  4
ERISA:  3.5 ...............................................  7
Exchange Act:  2.6(a) .....................................  2

F

Financial Emergency:  2.14 ................................  4

I

Incentive Compensation:  2.15 .............................  4
Indirect Subsidiary:  2.16 ................................  4
Interest:  2.17 ...........................................  5


                                  iv
                                <PAGE>

                               INDEX OF TERMS



TERM AND PROVISION NUMBER                                  PAGE


P

Paid Time Off:  2.18 .......................................  5
Paid Time Off Cancellation:  2.19 ..........................  5
Participant:  2.20 .........................................  5
Participating Employer:  2.21 ..............................  5
Pension Plan:  2.22 ........................................  5
PGC:  2.6(a) ...............................................  2
Plan:  2.23 ................................................  5
President:  2.25 ...........................................  6
Policies:  2.24 ............................................  6

S

Senior Administrative Officer:  2.26 .......................  6

                                v

                              <PAGE>


                    PORTLAND GENERAL HOLDINGS, INC.

                 MANAGEMENT DEFERRED COMPENSATION PLAN

                           1997 RESTATEMENT



                              ARTICLE I-PURPOSE

1.1  Restatement

   Portland General Corporation adopted a Management Deferred
Compensation Plan effective January  1, 1987 to cover qualified
management employees. Portland General Corporation also restated its
Directors' and Senior Officers' Deferred Compensation Plan on January
1, 1987. Pursuant to Article 8.1 of the Management Deferred
Compensation Plan and Article 9.1 of the Directors' and Senior
Officers' Deferred Compensation Plan, 1987 Restatement, the Company has
amended both plans in order to merge the plans for all employees of
Participating Employers. The existing plans were merged, renamed and
amended for all management employees of Participating Employers by the
December 1, 1988 Restatement. The Plan was further amended by the 1990,
1994 and 1996 Restatements.

1.2  Purpose

   The purpose of this Management Deferred Compensation Plan is to
provide elective deferred compensation in excess of the limits on
elective deferrals under qualified cash or deferred arrangements. It is
intended that the Plan will aid in attracting and retaining personnel
of exceptional ability.

1.3  Effective Date

   This 1997 Restatement shall be effective as of June 25, 1997.

1.4  Plan Sponsor

   The Plan is adopted for the benefit of selected employees of
Portland General Holdings, Inc., an Oregon corporation, and selected
employees 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  Account

   "Account" means the account maintained by a Participating Employer
in accordance with Article IV with respect to any deferral of
Compensation pursuant to this Plan.

PAGE 1 - MANAGEMENT DEFERRED COMPENSATION PLAN

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2.2  Base Salary

   "Base Salary" means the Eligible Employee's actual base pay in the
pay period and, except as provided herein, excluding any bonuses and/or
overtime pay.

2.3  Beneficiary

   "Beneficiary" means the person, persons or entity entitled under
Article VII to receive any Plan benefits payable after a Participant's
death.

2.4  Board

   "Board" means the Board of Directors of Portland General Holdings,
Inc..

2.5  Bonuses

   "Bonuses" means Our Teamworks Awards, Notable Achievement Awards,
and any other form of cash Incentive Compensation explicitly designated
as deferrable pursuant to this Plan by the Deferral Election form
approved by the Senior Administrative Officer.

2.6  Change in Control

   "Change in Control" means an occurrence in which:

      (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 the 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 or 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 PGC's stockholders was approval 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 or 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.

PAGE 2 - MANAGEMENT DEFERRED COMPENSATION PLAN

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2.7  Committee

   "Committee" means the Non-Qualified Benefits Committee of the Board.

2.8  Company

   "Company" means Portland General Holdings, Inc., an Oregon
Corporation.

2.9  Compensation

   "Compensation" means the total of the following, before reduction
for elective deferrals under this Plan or a Participating Employer's
tax qualified Retirement Savings Plan or any other flexible benefit
plan:

      (a) Base Salary;

      (b) Bonuses;

      (c) Any interest on the above payments credited by a
   Participating Employer for the benefit of an Eligible Employee prior
   to the date of payment, without respect to any deferral of
   Compensation made pursuant to this Plan, by a Participating
   Employer.

   Compensation, for purposes of this Plan, may include any new form of
cash remuneration paid by a Participating Employer to any Eligible
Employee which is explicitly designated as deferrable pursuant to this
Plan by the Deferral Election form approved by the Senior
Administrative Officer. Compensation for purposes of this Plan, does
not include expense reimbursements, imputed income, or any form of
noncash compensation or benefits.

2.10 Deferral Election

   "Deferral Election" means the election completed by Participant in a
form approved by the Senior Administrative Officer which indicates
Participant's irrevocable election to defer Compensation as designated
in the Deferral Election, pursuant to Article III.

2.11 Determination Date

   "Determination Date" means the last day of each calendar month.

2.12 Direct Subsidiary

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

PAGE 3 - MANAGEMENT DEFERRED COMPENSATION PLAN

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2.13  Eligible Employee

   "Eligible Employee" means an employee of a Participating Employer who:

      (a) Is exempt;

      (b) Is not covered by a collective bargaining agreement; and

      (c) If employed for the entire calendar year, receives or, based on
   current levels of base pay is expected to receive, Compensation from one
   (1) or more Participating Employers in the calendar year, in an amount
   equal to or in excess of the threshold amount described in 2.13(e) below,
   or

      (d) If employed for a part of the calendar year, receives or, based on
   an annualized level of base pay would have received, Compensation from one
   (1) or more Participating Employers in the calendar year, in an amount
   equal to or in excess of the threshold amount described in 2.13(e) below.
   Notwithstanding the above, eligibility is at the discretion of the Senior
   Administrative Officer.

      (e) The threshold amount in calendar year 1996 and any subsequent year
   shall be eighty-five thousand dollars ($85,000). Such amount may be
   adjusted by the Senior Administrative Officer each subsequent calendar
   year at the same time and in not less than the percentage ratio as the
   cost of living adjustment in the dollar limit on defined benefits under
   Section 415(d) of the Internal Revenue Code.

2.14 Financial Emergency

   "Financial Emergency" means a financial need resulting from a
serious unforeseen personal or family emergency, such as an act of God,
an adverse business or financial transaction, divorce, serious illness
or accident, or death in the family.

2.15 Incentive Compensation

   "Incentive Compensation" means payments made to a Participant in
recognition of meritorious work performance but shall not include,
without limitation, any payment received as moving expense, mortgage
expense or mortgage interest reimbursement.

2.16 Indirect Subsidiary

   "Indirect Subsidiary" means any corporation of which a Participating
Employer 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 Employer, 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.


PAGE 4 - MANAGEMENT DEFERRED COMPENSATION PLAN

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2.17 Interest

   "Interest" means the interest yield computed at the monthly
equivalent of an annual yield that is three (3) percentage points
higher than the annual yield on Moody's Average Corporate Bond Yield
Index for the three (3) calendar months preceding the immediately
prior month as published by Moody's Investors Service, Inc. (or any
successor thereto), or, if such index is no longer published, a
substantially similar index selected by the Board.

2.18 Paid Time Off

   "Paid Time Off" means those vacation and holiday days for which the
Employer pays employees for time not worked.

2.19 Paid Time Off Cancellation

   "Paid Time Off Cancellation" means cash payments made in lieu of
Paid Time Off earned by an Eligible Employee.

2.20 Participant

   "Participant" means any Eligible Employee who has elected to make
deferrals under this Plan.

2.21 Participating Employer

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

2.22 Pension Plan

   "Pension Plan" means the Participating Employer's Pension Plan, as
may be amended from time to time, and any successor defined benefit
retirement income plan or plans maintained by the Participating
Employer which qualify under Section 401(a) of the Internal Revenue
Code.

2.23 Plan

   "Plan" means the Portland General Holdings, Inc. Management Deferred
Compensation Plan, as may be amended from time to time.

PAGE 5 - MANAGEMENT DEFERRED COMPENSATION PLAN

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2.24 Policies

   "Policies" means any life insurance policies, annuity contracts or
the proceeds therefrom owned or which may be acquired by Participating
Employer.

2.25 President

     "President" means the President of the Company.

2.26 Senior Administrative Officer

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


                    ARTICLE III-ELIGIBILITY AND DEFERRALS

3.1  Eligibility

      (a) General.  An Eligible Employee who has completed one (1) year
   of continuous employment with one (1) or more Participating
   Employers shall be eligible to participate by making a Deferral
   Election under Paragraph 3.2 below. The Senior Administrative
   Officer shall notify Eligible Employees about the Plan and the
   benefits provided under it. The requirement of one (1) year of
   continuous employment may be waived by the Senior Administrative
   Officer.

      (b) Cessation of Eligibility.  An Eligible Employee who ceases to
   be an employee of a Participating Employer or to satisfy condition
   2.13(a) or 2.13(b) of the definition of Eligible Employee shall
   cease participating as to new deferrals immediately. An Eligible
   Employee who ceases to satisfy condition 2.13(c) of the definition
   of Eligible Employee may continue to participate in the Plan if such
   individual has a current election to defer under the Plan at the
   time the Employee ceases to satisfy condition 2.13(c).

3.2  Deferral Elections

      (a) Time of Elections.  An Eligible Employee may elect to
   participate in the Plan with respect to any Compensation and/or Paid
   Time Off Cancellation designated in a Deferral Election in a form
   approved by the Senior Administrative Officer. The Deferral Election
   must be filed with the Senior Administrative Officer no later than
   December 15, or such shorter period as is designated in the Deferral
   Election form.

      (b) Mid-Year Eligibility.  If an individual first becomes
   eligible to participate during a calendar year and wishes to defer
   Compensation and/or Paid Time Off Cancellation during the remainder
   of the year, a Deferral Election may be filed no later than thirty
   (30) days following notification of eligibility to participate to
   the individual by the Senior Administrative Officer. Such Deferral
   Election shall

PAGE 6 - MANAGEMENT DEFERRED COMPENSATION PLAN

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   be effective only with regard to Compensation and/or
   Paid Time Off Cancellation earned after it is filed with the Senior
   Administrative Officer.

      (c) Irrevocability.  A Deferral Election for the following
   calendar year shall become irrevocable on the December 15 by which
   it is due under Paragraph 3.2(a) and a Deferral Election for the
   current calendar year shall become irrevocable upon filing with the
   Senior Administrative Officer under Paragraph 3.2(b).

      (d) Transfer to a Participating Employer.  If a Participant
   transfers employment from one (1) Participating Employer to another
   Participating Employer, the Participant's Deferral Election shall
   remain in effect for the remainder of the calendar year with respect
   to Compensation earned by the individual after the transfer to the
   new Participating Employer.

3.3  Limits on Elective Deferrals

   A Participant may elect to defer up to eighty percent (80%) of Base
Salary and up to one hundred percent (100%) of Bonuses. The level of
deferral elected in either case must be in one percent (1%) increments.
A Participant may elect to defer up to one hundred twenty (120) hours
per year of Paid Time Off in one-tenth (1/10) hour increments, but may
not defer any Paid Time Off earned in prior calendar years, or the
first two hundred (200) hours of Paid Time Off earned in the calendar
year to which the Deferral Election relates.

3.4  Matching Contributions

   The Participating Employer shall provide a matching contribution for
each Participant who is making deferrals of Base Salary under this
Plan. The matching contribution shall be six percent (6%) of the
Participant's annual elective Base Salary deferral under this Plan. For
purposes of this provision, Base Salary shall not include amounts
received as a Nuclear Regulatory Commission licensing bonus.

3.5  Welfare Benefits

   Compensation deferred under this Plan shall constitute compensation
for purposes of any welfare plans, (as defined by the Employee
Retirement Income Security Act of 1974, as amended ("ERISA")),
sponsored by the Participating Employer.


                  ARTICLE IV-DEFERRED COMPENSATION ACCOUNT

4.1  Crediting to Account

   The amount of the elective deferrals and matching contributions for
a Participant under this Plan shall be credited to an Account for the
Participant on the books of the Participating Employer at the time the
Compensation would have been paid in cash. Any taxes or other amounts
due from the Participant with respect to the deferred Compensation
under federal, state or local law, such as a Participant's share of
FICA, shall be withheld from nondeferred Compensation payable to the
Participant at the time the deferred amounts are credited to the
Account.


PAGE 7 - MANAGEMENT DEFERRED COMPENSATION PLAN

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4.2  Determination of Accounts

   The last day of each calendar month shall be a Determination Date.
Each Participant's Account as of each Determination Date shall consist
of the balance of the Account as of the immediately preceding
Determination Date, plus the Participant's elective deferrals, matching
contributions, and Interest credited under this Plan, minus the amount
of any distributions made from this Plan since the immediately
preceding Determination Date. Interest credited shall be calculated as
of each Determination Date based upon the average daily balance of the
Account since the preceding Determination Date.

4.3  Vesting of Accounts

   Account balances in this Plan shall be fully vested at all times.

4.4  Statement of Accounts

   The Senior Administrative Officer shall submit to each Participant,
after the close of each calendar quarter and at such other times as
determined by the Senior Administrative Officer a statement setting
forth the balance of the Account maintained for the Participant.


                           ARTICLE V-PLAN BENEFITS

5.1  Benefits

      (a) Entitlement to Benefits at Termination.  Benefits under this
   Plan shall be payable to a Participant on termination of employment
   with all Participating Employers. The amount of the benefit shall be
   the balance of the Participant's Account including Interest to the
   date of payment, in the form elected under Paragraph 5.3 below.

      Notwithstanding the above, if a Participant transfers employment
   from a Participating Employer to an affiliate of the Company or
   Portland General Electric Company, including subsidiaries and joint
   venture partners, the status of which shall be determined at the
   discretion of the Senior Administrative Officer, the Participating
   Employer shall continue to maintain the Participant's Account
   pursuant to Section IV. Benefits shall be payable to such
   Participant under this paragraph or Paragraph 5.1(b) below when the
   Participant is no longer employed by any affiliated company, as
   determined at the discretion of the Senior Administrative Officer.

      (b) Entitlement to Benefits at Death.  Upon the death of a
   Participant for whom an Account is held under this Plan, a death
   benefit shall be payable to the Participant's Beneficiary in the
   same form as the Participant elected for payments at termination of
   employment, under Paragraph 5.3 below. The amount of the benefit
   shall be the balance of the Participant's Account including Interest
   to the date of payment.


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5.2  Withdrawals for Financial Emergency

   A Participant may withdraw part or all of the Participant's Account
for a Financial Emergency as follows:

      (a) Determination.  The existence of a Financial Emergency and
   the amount to be withdrawn shall be determined by the Senior
   Administrative Officer.

      (b) Suspension.  A Participant who makes a withdrawal for
   Financial Emergency from any company-sponsored deferral plan,
   whether qualified or nonqualified, shall be suspended from
   participation in this Plan for twelve (12) months from the date of
   such withdrawal. Compensation and/or Paid Time Off Cancellation
   payable during such suspension that would have been deferred under
   this Plan shall instead be paid to the Participant. No matching
   contribution shall be credited to a Participant's Account under this
   Plan during any period of suspension.

5.3  Form of Benefit Payment

      (a) The Plan benefits attributable to the elective deferrals for
   any calendar year shall be paid in one (1) of the forms set out
   below, as elected by the Participant in the form of payment
   designation filed with the Deferral Election for that year. The
   forms of benefit payment are:

          (i) A lump-sum payment;

          (ii) Monthly installment payments in substantially equal
      payments of principal and Interest over a period of up to one
      hundred eighty (180) months. The amount of the installment
      payment shall be redetermined on the first day of the month
      coincidental with or next following the anniversary of the date
      of termination each year, based upon the then current rate of
      Interest, the remaining Account balance, and the remaining number
      of payment periods; or

          (iii) For Participants designated by the President to the
      Senior Administrative Officer, monthly installment payments over
      a period of up to one hundred eighty (180) months, consisting of
      interest only payments for up to one hundred twenty (120) months
      and principal and interest payments of the remaining Account
      balance over the remaining period. The amount of the installment
      payment shall be redetermined on the first day of the month
      coincidental with or next following the anniversary of the date
      of termination each year, based upon the then current rate of
      Interest, the remaining Account balance, and the remaining number
      of payment periods.

          (iv) In the event the account balance is ten thousand dollars
      ($10,000) or less, that benefit will be paid out in a lump sum
      notwithstanding the form of benefit payment elected by the
      Participant.

      (b) A Participant may elect to file a change of payment
   designation which shall supersede all prior form of payment
   designations with respect to the Participant's entire Account. The
   Participant may redesignate a combination of


PAGE 9 - MANAGEMENT DEFERRED COMPENSATION PLAN

<PAGE>

   lump sum and monthly
   installments if approved by the Senior Administrative Officer. If,
   upon termination, the Participant's most recent change of payment
   designation has not been in effect for twelve (12) full months prior
   to such termination, then the prior election shall be used to
   determine the form of payment. The Senior Administrative Officer
   may, in his sole discretion, direct that plan benefits be paid
   pursuant to the change of payment designation, notwithstanding the
   twelve (12) month requirement.

      (c) Participants designated by the President to the Senior
   Administrative Officer may elect to file a change of payment
   designation which shall supersede all prior form of payment
   designations with respect to the Participant's entire Account. The
   Participant may redesignate monthly installment payments over a
   period of up to one hundred eighty (180) months, consisting of
   interest only payments for up to one hundred twenty (120) months and
   principal and interest payments of the remaining Account balance
   over the remaining period. To be effective, such designation must be
   approved by the President and the Senior Administrative Officer. If,
   upon termination, the Participant's most recent change of payment
   designation has not been in effect for twelve (12) full months prior
   to such termination, then the prior election shall be used to
   determine the form of payment. The Senior Administrative Officer
   may, in his sole discretion, direct that Plan benefits be paid
   pursuant to the change of payment designation, notwithstanding the
   twelve (12) month requirement.

5.4  Accelerated Distribution

   Notwithstanding any other provision of the Plan, a Participant shall
be entitled to receive, upon written request to the Senior
Administrative Officer, a lump-sum distribution of all or a portion of
the vested Account balance, subject to the following:

      (a) Penalty.

          (i) If the distribution is requested within thirty-six (36)
      months following a Change in Control, six percent (6%) of the
      account shall be forfeited and ninety-four percent (94%) of the
      account paid to the Participant.

          (ii) If the distribution is requested at any time other than
      that in (i) above, ten percent (10%) of the account shall be
      forfeited and ninety percent (90%) of the account paid to the
      Participant.

      (b) Suspension.  A Participant who receives a distribution under
   this section shall be suspended from participation in this Plan for
   twelve (12) calendar months from the date of such distribution. All
   eligibility requirements must be met to reenter the Plan. The
   account balance shall be as of the Determination Date immediately
   preceding the date on which the Senior Administrative Officer
   receives the written request. The amount payable under this section
   shall be paid in a lump sum within sixty-five (65) days following
   the receipt of the Participant's written request by the Senior
   Administrative Officer.


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5.5  Withholding; Payroll Taxes

   Each Participating Employer shall withhold from payments made
hereunder any taxes required to be withheld from a Participant's wages
for the federal or any state or local government. Withholding shall
also apply to payments to a Beneficiary unless an election against
withholding is made under Section 3405(a)(2) of the Internal Revenue
Code.

5.6  Commencement of Payments

   Payment shall commence at the discretion of the Senior
Administrative Officer, but not later than sixty-five (65) days after
the end of the month in which a Participant retires, dies or otherwise
terminates employment. All payments shall be made as of the first day
of the month.

5.7  Full Payment of Benefits

   Notwithstanding any other provision of this Plan, all benefits shall
be paid no later than one hundred eighty (180) months following the
date payment to a Participant commences.

5.8  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 Participating
Employer, and the Company from all liability with respect to such
benefit.


               ARTICLE VI-RESTORATION OF PENSION PLAN BENEFITS

6.1  Pension Plan

   If a Participating Employer maintains a tax qualified Pension Plan
for the benefit of eligible employees, and the Pension Plan provides
benefits determined under a formula that is based in part on the
employee's nondeferred compensation, a Participant in this Plan may
receive a smaller benefit under the Pension Plan as a result of
electing deferrals under this Plan.

6.2  Restoration of Pension Plan Benefits

   In addition to the benefits payable under Paragraph 5.1 above,
Participating Employer shall pay to any Participant whose Pension Plan
benefit is not restored under any other employee or executive benefit
plan maintained by Participating Employer, a benefit payment equal to
the excess of (b) over (a) as follows:


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      (a) The actuarial equivalent lump sum present value of the
   retirement income (or death benefit) payable (either immediately or
   deferred) under the Pension Plan; and

      (b) the actuarial equivalent lump sum present value of the
   retirement income (or death benefit) that would have been payable
   under the Pension Plan if Participant had made no Deferral Elections
   in any calendar year under this Plan. The actuarial equivalent lump
   sum present values shall be calculated in the same manner and using
   the same factors as are used to calculate lump-sum distributions
   under the Pension Plan. If Participant terminates employment prior
   to attaining the age of fifty-five (55), payment of the restoration
   of Pension Plan benefits shall be made as if Participant had made a
   lump-sum election pursuant to Paragraph 5.3(a)(i) above with respect
   to the payment of the restoration of Pension Plan benefits. If
   Participant terminates employment upon or after attaining the age of
   fifty-five (55), payment of the restoration of Pension Plan benefits
   shall be made as if Participant had made an election to receive
   monthly installment payments in substantially equal payments of
   principal and Interest over a period of one hundred twenty (120)
   months pursuant to Paragraph 5.3(a)(ii) above with respect to the
   payment of the restoration of Pension Plan benefits. In the event
   the actuarial equivalent lump sum present value is ten thousand
   dollars ($10,000) or less, that benefit will be paid out in a lump
   sum.

6.3  Restoration of Pension Plan Benefits in Event of Change in Control

   In the event of a Change in Control, and a subsequent termination of
the Pension Plan within three (3) years following a Change in Control,
all Plan Participants shall receive a restoration of Pension Plan
benefits under Paragraph 6.2.


                     ARTICLE VII-BENEFICIARY DESIGNATION

7.1  Beneficiary Designation

   Each Participant shall have the right, at any time, to designate one
(1) or more persons or entities as the Participant's Beneficiary,
primary as well as secondary, to whom benefits under this Plan shall be
paid in the event of the Participant's death prior to complete
distribution to the Participant of the benefits due under the Plan.
Each Beneficiary designation shall be in a written form prescribed by
the Senior Administrative Officer and will be effective only when filed
with the Senior Administrative Officer during the Participant's
lifetime.

7.2  Amendments

   Any Beneficiary designation may be changed by a Participant without
the consent of any Beneficiary by the filing of a new Beneficiary
designation with the Senior Administrative Officer. If a Participant's
Compensation is community property, any Beneficiary designation shall
be valid or effective only as permitted under applicable law.

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7.3  No Beneficiary Designation

   In the absence of an effective Beneficiary designation, or if all
Beneficiaries predecease a Participant, the Participant's estate shall
be the Beneficiary. If a Beneficiary dies after a Participant and
before payment of benefits under this Plan has been completed, the
remaining benefits shall be payable to the Beneficiary's estate.

7.4  Effect of Payment

   Payment to the Beneficiary shall completely discharge the
Participating Employer's obligations under this Plan.


                         ARTICLE VIII-ADMINISTRATION

8.1  Senior Administrative Officer; Duties

   This Plan shall be administered by a Senior Administrative Officer
appointed by the Committee. The Senior Administrative Officer may be a
Participant 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.

8.2  Agents

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

8.3  Binding Effect of Decisions

   The decision or action of the Senior Administrative Officer in
respect of 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.

8.4  Indemnity of Senior Administrative Officer; Committee

   Each Participating Employer shall indemnify and hold harmless the
Senior Administrative Officer, 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.

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8.5  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.

8.6  Cost of Plan Administration

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


                         ARTICLE IX-CLAIMS PROCEDURE

9.1  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.

9.2  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.

9.3  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.

9.4  Final Decision

   The decision by 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
the relevant Plan provisions. All decisions on review shall be final
and bind all parties concerned.


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                 ARTICLE X-AMENDMENT AND TERMINATION OF PLAN

10.1 Amendment

     The Senior Administrative Officer may amend the Plan from time to
time as may be necessary for administrative purposes and legal
compliance of the Plan, 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 accrued
rights of Participants and Beneficiaries to the amounts in their
Accounts at the time of the amendment. Such amendments shall be subject
to the following:

        (a) Preservation of Account Balance.  No amendment shall reduce
     the amount accrued in any Account to the date such notice of the
     amendment is given.

        (b) Changes in Interest Rate.  No amendment shall reduce the
     rate of Interest to be credited, after the date of the amendment,
     on the amount already accrued in any Account or on the deferred
     Compensation credited to any Account under Deferral Elections
     already in effect on the date of the amendment.

10.2 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.

10.3  Payment at Termination

     If the Plan is terminated, payment of each Account to a
Participant or a Beneficiary for whom it is held shall commence
pursuant to Paragraph 5.6, and shall be paid in the form designated by
the Participant.


                       ARTICLE XI-MISCELLANEOUS

11.1 Unfunded Plan

   This Plan is intended to be an unfunded plan maintained primarily to
provide deferred compensation benefits for a select group of
"management or highly compensated employees" within the meaning of
Sections 201, 301, and 401 of ERISA, and therefore to be exempt from
the provisions of Parts 2, 3 and 4 of Title I of ERISA. Accordingly,
the Board may terminate the Plan and commence termination payout under
10.3 above for all or certain Participants, or remove certain employees
as Participants, if it is determined by the United States Department of
Labor or a court of competent jurisdiction that the Plan constitutes an
employee pension benefit plan within the meaning of Section 3(2) of
ERISA

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<PAGE>



which is not so exempt. This Plan is not intended to create an
investment contract, but to provide retirement benefits to eligible
individuals who have elected to participate in the Plan. Eligible
individuals are select members of management who, by virtue of their
position with Participating Employer, are uniquely informed as to
Participating Employer's operations and have the ability to materially
affect Participating Employer's profitability and operations.

11.2 Liability

      (a) Liability for 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
   Employer that employs the Participant and reports the Participant as
   being on its payroll 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 Employer's own employees.
   Provided, however, that each Participating Employer, by accepting
   the Board's designation as a Participating Employer 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 is employed and on the payroll of a Participating
   Employer that is a Direct Subsidiary or Indirect Subsidiary of the
   Participating Employer 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
   Employer or any other person from expressly agreeing to the
   assumption of liability for a Plan Participant's payment of any
   benefits under the Plan.

      (b) Unsecured General Creditor.  Participants and their
   Beneficiaries, heirs, successors, and assigns shall have no secured
   legal or equitable rights, interest or claims in any property or
   assets of a Participating Employer, nor shall they be beneficiaries
   of, or have any rights, claims or interests in any Policies or the
   proceeds therefrom owned or which may be acquired by a Participating
   Employer. Except as provided in Section 11.3, such Policies or other
   assets of a Participating Employer shall not be held under any trust
   for the benefit of Participants, their Beneficiaries, heirs,
   successors or assigns, or held in any way as collateral security for
   the fulfilling of the obligations of a Participating Employer under
   this Plan. Any and all of a Participating Employer's assets and
   Policies shall be, and remain, the general, unpledged, unrestricted
   assets of the Participating Employer. A Participating Employer's
   obligation under the Plan shall be that of an unfunded and unsecured
   promise to pay money in the future.

11.3 Trust Fund

   At its discretion, each Participating Employer, jointly or
severally, may establish one (1) or more trusts, with such trustee 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 the Participating Employer's
creditors. To the extent any benefits provided under the Plan are
actually paid from any such trust, the


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Participating Employer 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 the Participating Employer.

11.4 Nonassignability

   Neither a Participant 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 rights to which are, expressly declared to be nonassignable and
nontransferable. No part of the amounts 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.

11.5 Not a Contract of Employment

   The terms and conditions of this Plan shall not be deemed to
constitute a contract of employment between a Participating Employer
and a Participant, and neither a Participant nor a Participant's
Beneficiary shall have any rights against a Participating Employer
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 in the service of a Participating Employer or to interfere
with the right of a Participating Employer to discipline or discharge a
Participant at any time.

11.6 Protective Provisions

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

11.7 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.

11.8 Terms

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

11.9 Validity

   In case any provisions of this Plan shall be held illegal or invalid
for any reason, such illegality or invalidity shall not affect the
remaining parts hereof, but this Plan shall be


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construed and enforced
as if such illegal and invalid provision had never been inserted
herein.

11.10 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 to Secretary of Participating
Employer. Notice to the Senior Administrative Officer, if mailed, shall
be addressed to the principal executive offices of Participating
Employer. Notice mailed to the Participant shall be at such address as
is given in the records of the Participating Employer. Notices shall 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.

11.11 Successors

   The provisions of this Plan shall bind and inure to the benefit of
each Participating Employer 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 a Participating Employer, and successors of any such corporation or
other business entity.

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


                            PORTLAND GENERAL HOLDINGS, INC.


                              By:  /s/ Don F. Kielblock

                              Its:  Vice President


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