PACIFICORP /OR/, SC 13D, 1995-03-09

PACIFICORP /OR/
SC 13D, 1995-03-09
ELECTRIC & OTHER SERVICES COMBINED

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<PAGE>1

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 13D

UNDER THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. 18)*

PACIFIC TELECOM, INC.
- -------------------------------------------------------------
(Name of Issuer)

Common Stock (no par value)
- -------------------------------------------------------------
(Title of Class of Securities)

694876 10 3
------------------------------
(CUSIP Number)

Richard T. O'Brien
PacifiCorp
700 NE Multnomah, Suite 1600
Portland, Oregon 97232-4116
Telephone: (503) 731-2133
- -------------------------------------------------------------
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications)

March 9, 1995
------------------------------
(Date of Event which Requires Filing of this Statement)

If the filing person has previously filed a statement on
Schedule 13G to report the acquisition which is the subject of
this Schedule 13D, and is filing this schedule because of
Rule 13d-1(b)(3) or (4), check the following box / /.

Check the following box if a fee is being paid with the statement
/ /. (A fee is not required only if the reporting person:
(1) has a previous statement on file reporting beneficial
ownership of more than five percent of the class of securities
described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less
of such class.) (See Rule 13d-7.)

NOTE: Six copies of this statement, including all exhibits,
should be filed with the Commission. See Rule 13d-1(a) for other
parties to whom copies are to be sent.

*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to
the subject class of securities, and for any subsequent amendment
containing information which would alter the disclosures provided
in a prior cover page.

The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18
of the Securities Exchange Act of 1934 ("Act") or otherwise
subject to the liabilities of that section of the Act but shall
be subject to all other provisions of the Act (however, see the
Notes).<PAGE>
<PAGE>3
SCHEDULE 13D

CUSIP No. 694876 10 3
- -------------------------------------------------------------
1 NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON

PacifiCorp Holdings, Inc. (formerly Inner PacifiCorp, Inc.)
93-0866672
- -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
- -------------------------------------------------------------
3 SEC USE ONLY

- -------------------------------------------------------------
4 SOURCE OF FUNDS*

BK
- -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
/ /
- -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION

Delaware
- -------------------------------------------------------------
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH:

7 SOLE VOTING POWER

0
- -------------------------------------------------------------
8 SHARED VOTING POWER

34,325,181
- -------------------------------------------------------------
9 SOLE DISPOSITIVE POWER

0
- -------------------------------------------------------------
10 SHARED DISPOSITIVE POWER

34,325,181
- -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

34,325,181
- -------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES*
/ /
- -------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)

86.6%
- -------------------------------------------------------------
14 TYPE OF REPORTING PERSON*

CO
- -------------------------------------------------------------<PAGE>
<PAGE>3
SCHEDULE 13D

CUSIP No. 694876 10 3
- -------------------------------------------------------------
1 NAME OF REPORTING PERSON

S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
PacifiCorp 93-0246090
- -------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
- -------------------------------------------------------------
3 SEC USE ONLY

- -------------------------------------------------------------
4 SOURCE OF FUNDS*

Not Applicable
- -------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) OR 2(e)
/ /
- -------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION

Oregon
- -------------------------------------------------------------
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH REPORTING PERSON
WITH

7 SOLE VOTING POWER

0
- -------------------------------------------------------------
8 SHARED VOTING POWER

34,325,181
- -------------------------------------------------------------
9 SOLE DISPOSITIVE POWER

0
- -------------------------------------------------------------
10 SHARED DISPOSITIVE POWER

34,325,181
- -------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON

86.6%
- -------------------------------------------------------------
14 TYPE OF REPORTING PERSON*

CO
- -------------------------------------------------------------<PAGE>
<PAGE>4
PACIFICORP HOLDINGS, INC.
-------------------------

AMENDMENT NO. 18 TO
SCHEDULE 13D
------------

Item 1. Security and Issuer.
- ------ -------------------

PacifiCorp Holdings, Inc. (formerly Inner PacifiCorp,
Inc.), a Delaware corporation ("PacifiCorp Holdings"), amends its
statement on Schedule 13D (as previously amended, "Statement")
pertaining to the Common Stock, no par value ("Common Stock"),
of Pacific Telecom, Inc., a Washington corporation ("PTI"). This
Amendment No. 18 ("Amendment") amends the Statement to report the
transactions contemplated by that certain Agreement and Plan of
Merger dated as of March 9, 1995 (the "Merger Agreement"), by and
among PacifiCorp Holdings, PTI and PXYZ Corporation, a Washington
corporation and a wholly owned subsidiary of PacifiCorp Holdings
("Merger Sub"), pursuant to which PacifiCorp Holdings intends to
acquire the minority interest of PTI. PacifiCorp, an Oregon
corporation ("PacifiCorp"), which owns 100 percent of the
outstanding voting securities of PacifiCorp Holdings, joins in
this filing.

Item 2. Identity and Background.
- ------ -----------------------

PacifiCorp Holdings owns approximately 86.6% of PTI, 100%
of PacifiCorp Financial Services, Inc. ("PFS") and 100% of
Pacific Generation Company ("PGC"). These ownership interests
are the primary assets of PacifiCorp Holdings. PTI, through its
subsidiaries, provides local telephone service and access to the
long distance network in Alaska, seven other western states and
three midwestern states, provides intrastate and interstate long
distance communication services in Alaska, provides cellular
mobile telephone services and is engaged in sales of capacity in
and operation of a submarine fiber-optic cable between the U.S.
and Japan. PFS plans to continue sales of portions of its loan,
leasing and real estate investments over the next several years.
PGC is engaged in the independent power production and
cogeneration business.

PacifiCorp Holdings is a wholly owned subsidiary of
PacifiCorp, an electric utility that conducts a retail electric
utility business through Pacific Power & Light Company ("Pacific
Power") and Utah Power & Light Company ("Utah Power"), and
engages in power production and sales on a wholesale basis under
the name PacifiCorp. The Company furnishes electric service in
portions of seven western states: California, Idaho, Montana,
Oregon, Utah, Washington and Wyoming. The principal executive
offices of PacifiCorp and PacifiCorp Holdings are located at 700
NE Multnomah, Suite 1600, Portland, Oregon 97232-4116.

For a current list of the executive officers and
directors of PacifiCorp Holdings and PacifiCorp, along with the
other information required to be furnished with respect to such
executive officers and directors under this Item 2, see
Exhibit 1, which is incorporated herein by reference.

Neither PacifiCorp Holdings nor PacifiCorp has been,
during the last five years, (i) convicted in a criminal
proceeding (excluding traffic violations or similar
misdemeanors), or (ii) a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction which
resulted in a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject to,
federal or state securities laws or finding any violation with
respect to such laws.

Item 3. Source and Amount of Funds or Other Consideration.
- ------ -------------------------------------------------

PacifiCorp Holdings currently plans to finance the
proposed acquisition by borrowing some or all of the required
funds under the $500,000,000 Credit Agreement (the "Credit
Agreement") dated September 30, 1993 among PacifiCorp Holdings,
the banks listed therein, Bank of America National Trust and
Savings Association, as Co-Agent and Morgan Guaranty Trust
Company of New York, as Agent, a copy of which was filed as an
exhibit to Amendment No. 17 to the Statement. PacifiCorp
Holdings will need to obtain an amendment of certain borrowing
restrictions in the Credit Agreement to complete the transaction.
However, PacifiCorp Holdings is planning to replace the Credit
Agreement with a new credit facility that does not include those
restrictions.<PAGE>
<PAGE>5

Item 4. Purpose of Transaction.
- ------ ----------------------

The Merger Agreement, which is more fully described in
Item 6 of this Amendment, contemplates the merger (the "Merger")
of Merger Sub with and into PTI, with PTI as the corporation
surviving the Merger. In the Merger, each share of outstanding
Common Stock owned by PacifiCorp Holdings will be cancelled and
each share of Common Stock owned by shareholders other than
PacifiCorp Holdings will be converted into the right to receive
a cash payment of $30.00. Each outstanding share of the capital
stock of Merger Sub will be converted into one share of Common
Stock. As a result of the Merger, PTI would become a wholly
owned subsidiary of PacifiCorp Holdings.

The Merger Agreement includes an agreement by PTI to take
all actions requested by PacifiCorp Holdings to cause such
additional directors as may be designated by PacifiCorp Holdings
to be elected at the shareholder meeting at which the Merger will
be submitted to a vote of PTI's shareholders. The provision
reflects the current intention of PacifiCorp Holdings, regardless
of the outcome of the vote on the Merger, to increase the size
of the Board and to elect at the meeting an as yet undetermined
number of additional directors designated by PacifiCorp Holdings.

Consummation of the Merger will cause the Common Stock
to cease to be quoted on NASDAQ and will result in termination
of registration of the Common Stock under Section 12 of the
Exchange Act.

Item 5. Interest in Securities of the Issuer.
- ------ ------------------------------------

The information set forth below amends and restates the
information included under Item 5 of the Statement:

(a) - (b) The aggregate number of shares of Common Stock
beneficially owned by the persons named in response to Item 2,
and the number of shares of Common Stock with respect to which
there is sole power to vote or to direct the vote, shared power
to vote or to direct the vote, sole power to dispose or to direct
the disposition, or shared power to dispose or to direct the
disposition, are set forth on Exhibit 2, which is incorporated
herein by reference. Except as described in Exhibit 2, neither
PacifiCorp Holdings, PacifiCorp, nor, to the knowledge of
PacifiCorp Holdings or PacifiCorp, any director or officer of
either of them is the beneficial owner of any Common Stock.

(c) Information regarding transactions in shares of
Common Stock within the past 60 days by the persons named in
response to Item 2 is set forth on Exhibit 2. Except as
described in Exhibit 2, neither PacifiCorp Holdings, PacifiCorp
nor, to the knowledge of PacifiCorp Holdings, any director or
officer of either of them has bought or sold or otherwise
effected any transactions in shares of the Common Stock during
the past 60 days.

(d) - (e) Not applicable.

Item 6. Contracts, Arrangements, Understandings or Relationships
- ------ -----------------------------------------------------
with Respect to Securities of the Issuer.
----------------------------------------

The Merger Agreement is attached hereto as Exhibit 3 and
incorporated herein by reference. As described above, the Merger
will have the effect of an acquisition by PacifiCorp Holdings of
all of the outstanding Common Stock currently owned by the
minority shareholders for a purchase price of $30.00 per share
in cash.

The Merger Agreement contains representations, warranties
and covenants customary in transactions of similar size and type,
including a covenant obligating PTI to conduct its business in
the ordinary course and consistent with past practice prior to
consummation of the Merger and not to take, or permit its
subsidiaries to take, certain actions, including amendment of
their respective articles of incorporation or bylaws or the
issuance of any securities (other than issuances by PTI of Common
Stock pursuant to the PacifiCorp K Plus and Employee Stock
Ownership Plan). The Merger Agreement also contains a covenant
of PacifiCorp Holdings with respect to indemnification of PTI's
directors and officers.<PAGE>
<PAGE>6

The Merger Agreement contains a number of closing
conditions, including (i) approval of the Merger by the
affirmative vote of the holders of at least a majority of the
outstanding shares held by shareholders other than PacifiCorp
Holdings, (ii) accuracy of certain representations and warranties
and compliance with the covenants in the Merger Agreement and
(iii) other conditions customary in transactions of similar size
and type. In addition, the obligations of PacifiCorp Holdings
and Merger Sub are conditioned upon the absence of any material
adverse change affecting the business or properties of PTI and
its subsidiaries. The obligations of PTI are also conditioned
upon (i) no withdrawal, modification or revocation of the
fairness opinions rendered to the Special Committee of PTI's
Board of Directors, and (ii) the accuracy of representations and
compliance with covenants contained in an agreement dated as of
March 9, 1995 between PacifiCorp and PTI (the "PacifiCorp
Agreement") pursuant to which PacifiCorp has agreed to, among
other things, cooperate with PacifiCorp Holdings in making
certain filings required under the Securities Exchange Act of
1934 with respect to the Merger and to provide indemnification
for certain matters to present directors and officers of PTI.
The PacifiCorp Agreement is attached hereto as Exhibit 4 and
incorporated herein by reference.

The Merger will close on the date when the last of the
required conditions to closing has been satisfied or waived, or
at such other time as may be agreed to by the parties.

Item 7. Material to be Filed as Exhibits.
- ------ --------------------------------

Exhibit 1, Directors and officers of corporations named
in Item 2.

Exhibit 2, Interests in Securities of PTI.

Exhibit 3, Agreement and Plan of Merger dated as of
March 9, 1995 by and among Pacific Telecom, Inc.,
PacifiCorp Holdings, Inc. and PXYZ Corporation.

Exhibit 4, Agreement dated as of March 9, 1995 between
PacifiCorp and Pacific Telecom, Inc.<PAGE>
<PAGE>7

After reasonable inquiry and to the best of my knowledge
and belief, I certify that the information set forth in this
statement is true, complete and correct.

DATED this 9th day of March, 1995.

PACIFICORP HOLDINGS, INC.

By RICHARD T. O'BRIEN
------------------------------
Richard T. O'Brien
Senior Vice President

Attention: Intentional misstatements or omissions of fact
constitute Federal criminal violations (See 18 U.S.C. 1001).
------------------------------------------------------------
<PAGE>
EXHIBIT INDEX

Exhibit No. Description Page No.
- ----------- ----------- --------

1. Directors and Executive Officers of
Corporations named in Item 2.

2. Interests in Securities of
Pacific Telecom, Inc.

3. Agreement and Plan of Merger dated
as of March 9, 1995 by and among
Pacific Telecom, Inc., PacifiCorp
Holdings, Inc. and PXYZ Corporation.

4. Agreement dated as of March 9, 1995
between PacifiCorp and Pacific
Telecom, Inc.

<PAGE>1
EXHIBIT 1

DIRECTORS AND EXECUTIVE OFFICERS
OF PACIFICORP HOLDINGS, INC. and PACIFICORP

(Note: footnote (*) appears at end of this Exhibit 1)

The directors and executive officers of PacifiCorp
Holdings, Inc. and PacifiCorp are as follows:
<TABLE>
PacifiCorp Holdings, Inc.
-------------------------
<CAPTION>
Name Title Principal Occupation
<S> <C> <C>

Frederick W. Buckman Director President and Chief Executive
Officer of PacifiCorp*

C. Todd Conover Director General Manager, Finance
Industry Group, Tandem
Computers Incorporated, 19191
Vallco Parkway, LOC 4-57,
Cupertino, California 95014

A.M. Gleason Director Vice Chairman of Board of
Directors of PacifiCorp*

Michael C. Henderson Director and President Director and President of
PacifiCorp Holdings, Inc.*;
Director & President of PacifiCorp
Financial Services, Inc.*, a
financial services company with
offices at 825 NE Multnomah,
Suite 775, Portland, Oregon 97232

Nolan E. Karras Director Owner of Investment Management
& Research, Inc., an investment
advisory firm with offices at 4695
South 1900 West #3, Roy, Utah
84067

Richard T. O'Brien Senior Vice President Vice President of PacifiCorp*;
Senior Vice President of
PacifiCorp Holdings, Inc.*

Daniel L. Spalding Senior Vice President Senior Vice President of
PacifiCorp*; Senior Vice President
of PacifiCorp Holdings, Inc.*

William E. Peressini Treasurer Treasurer of PacifiCorp*;
Treasurer of PacifiCorp Holdings,
Inc.*

<PAGE>
<PAGE>2
Sally A. Nofziger Secretary Vice President and Corporate
Secretary of PacifiCorp*;
Secretary of PacifiCorp Holdings,
Inc.*

Jacqueline S. Bell Controller Controller of PacifiCorp*;
Controller of PacifiCorp Holdings,
Inc.*
</TABLE>

All of the directors and executive officers of Pacific
Holdings, Inc. are U.S. citizens. The business address of each
individual listed above is the address shown for the
individual's principal occupation. None of the individuals
listed has been, during the last five years, (i) convicted in a
criminal proceeding (excluding traffic violations or similar
misdemeanors), or (ii) a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction which
resulted in a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation
with respect to such laws.

<TABLE>
PacifiCorp
----------
<CAPTION>
Name Title Principal Occupation
<S> <C> <C>
Kathryn A. Braun Director Executive Vice President, Western
Digital Corporation, 8105 Irvine
Center Drive, Irvine, CA 92718

Frederick W. Buckman Member of Corporate President and Chief Executive
Policy Group, Director Officer of PacifiCorp*
and President & Chief
Executive Officer

C. Todd Conover Director General Manager, Finance
Industry Group, Tandem
Computers Incorporated, 19191
Vallco Parkway, LOC 4-57,
Cupertino, California 95014

Richard C. Edgley Director Member of Presiding Bishopric,
The Church of Jesus Christ of
Latter-day Saints, 50 East North
Temple, 18th Floor, Salt Lake
City, Utah 84150

A.M. Gleason Director and Vice Vice Chairman of the Board of
Chairman of the Board PacifiCorp*

John C. Hampton Director Chairman and Chief Executive
Officer of Hampton Resources,
Inc., a forest products company
with offices at Suite 400, 9400 SW
Barnes Rd., Portland, Oregon
97225

<PAGE>
<PAGE>3
Nolan E. Karras Director Owner of Investment Management
& Research, Inc., an investment
advisory firm with offices at 4695
South 1900 West #3, Roy, Utah
84067

Keith R. McKennon Director and Chairman Chairman of the Board of
of the Board of Directors PacifiCorp*

Robert G. Miller Director Chairman of the Board and Chief
Executive Officer of Fred Meyer,
Inc., a retail merchandising chain,
with offices at 3800 SE 22nd,
Portland, Oregon 97202

Verl R. Topham Director, Senior Vice Senior Vice President and
President and General General Counsel of PacifiCorp*
Counsel of PacifiCorp

Don M. Wheeler Director Chairman and Chief Executive
Officer, Wheeler Machinery
Company, an equipment sales,
repair and service firm with
offices at 4901 West 2100 South,
Salt Lake City, Utah 84120

Nancy Wilgenbusch Director President, Marylhurst College,
Marylhurst, Oregon, 97036

Paul G. Lorenzini Member of Corporate Senior Vice President of
Policy Group and Senior PacifiCorp*
Vice President of PacifiCorp

Charles E. Robinson Member of Corporate Chairman, President and Chief
Policy Group Executive Officer of Pacific
Telecom, Inc., a
telecommunications holding
company with offices at 805
Broadway, P.O. Box 9901,
Vancouver, Washington 98668

John A. Bohling Senior Vice President Senior Vice President of
PacifiCorp*

Shelley R. Faigle Senior Vice President Senior Vice President of
PacifiCorp*

John E. Mooney Senior Vice President Senior Vice President of
PacifiCorp*

Daniel L. Spalding Senior Vice President Senior Vice President of
PacifiCorp*; Senior Vice President
of PacifiCorp Holdings, Inc.*

Dennis P. Steinberg Senior Vice President Senior Vice President of
PacifiCorp*

<PAGE>
<PAGE>4
Thomas J. Imeson Vice President Vice President of PacifiCorp*

Robert F. Lanz Vice President Vice President of PacifiCorp*

Sally A. Nofziger Vice President & Vice President and Corporate
Corporate Secretary Secretary of PacifiCorp*;
Secretary of PacifiCorp Holdings,
Inc.*

Richard T. O'Brien Vice President Vice President of PacifiCorp*;
Senior Vice President of
PacifiCorp Holdings, Inc.*

William E. Peressini Treasurer Treasurer of PacifiCorp*;
Treasurer of PacifiCorp Holdings,
Inc.*

Jacqueline S. Bell Controller Controller of PacifiCorp*;
Controller of PacifiCorp Holdings,
Inc.*
</TABLE>

All of the directors and executive officers of
PacifiCorp are U.S. citizens. The business address of each
individual listed above is the address shown for the
individual's principal occupation. None of the individuals
listed has been, during the last five years, (i) convicted in a
criminal proceeding (excluding traffic violations or similar
misdemeanors), or (ii) a party to a civil proceeding of a
judicial or administrative body of competent jurisdiction which
resulted in a judgment, decree or final order enjoining future
violations of, or prohibiting or mandating activities subject
to, federal or state securities laws or finding any violation
with respect to such laws.

[FN]
* The principal business and address of the corporation or
other organization for which the listed individual's principal
occupation is conducted is set forth at the first place at
which the name of such corporation or other organization
appears in this Exhibit 1.

<PAGE>1
EXHIBIT 2

INTERESTS IN SECURITIES OF
PACIFIC TELECOM, INC.

The beneficial ownership interests of PacifiCorp Holdings,
PacifiCorp and the directors and officers of each of them as of
December 31, 1994 are described below. The percentages are
calculated on the basis of 39,619,623 shares of Common Stock
outstanding as of December 31, 1994.

<TABLE>
PacifiCorp Holdings, Inc.
-------------------------
<CAPTION>
Nature of Number of Percent of Total Number
Ownership Shares of Outstanding Shares
- --------- --------- -----------------------
<S> <C> <C>
Sole Power to Vote 0 0%
or Direct the Vote

Shared Power to Vote 34,325,181 86.6%
or Direct the Vote

Sole Power to Dispose or 0 0%
to Direct the Disposition

Shared Power to Dispose or 34,325,181 86.6%
to Direct the Disposal

Total Beneficially Owned 34,325,181 86.6%

PacifiCorp Holdings has not bought or sold or otherwise effected any transactions in shares of
Common Stock during the past 60 days.

</TABLE>

<PAGE>
<PAGE>2
<TABLE>
PacifiCorp
----------
<CAPTION>
Nature of Number of Percent of Total Number
Ownership Shares of Outstanding Shares
- --------- --------- -----------------------
<S> <C> <C>
Sole Power to Vote 0 0%
or Direct the Vote

Shared Power to Vote 34,325,181 86.6%
or Direct the Vote

Sole Power to Dispose or 0 0%
to Direct the Disposition

Shared Power to Dispose or 34,325,181 86.6%
to Direct the Disposal

Total Beneficially Owned 34,325,181 86.6%

PacifiCorp has not bought or sold or otherwise effected any
transactions in shares of Common Stock during the past 60 days.

</TABLE>
<PAGE>
<PAGE>3
<TABLE>
A.M. Gleason
------------
<CAPTION>
Nature of Number of Percent of Total Number
Ownership Shares of Outstanding Shares
- --------- --------- -----------------------
<S> <C> <C>
Sole Power to Vote 38,954.0523 *
or Direct the Vote

Shared Power to Vote 5,450** *
or Direct the Vote

Sole Power to Dispose or 38,954.0523 *
to Direct the Disposition

Shared Power to Dispose or 5,450** *
to Direct the Disposal

Total Beneficially Owned 44,404.0523** *

Mr. Gleason is a participant in the PacifiCorp K Plus Employee Savings and Stock Ownership
Plan ("K Plus Plan") and, pursuant to an election in effect since January 3, 1990, he has directed
that a portion of his elective contributions be invested in the Pacific Telecom, Inc. Common Stock
fund (the "PTI Stock Fund"). The Trustee of the K Plus Plan has acquired shares of Pacific
Telecom Common Stock with funds invested in the PTI Stock Fund within the past 60 days,
172.4667 of which were allocated to Mr. Gleason's account effective as of March 6, 1995. Mr.
Gleason has not bought or sold or otherwise effected any other transactions in shares of Common
Stock during the past 60 days.
<FN>
__________________

* Less than 1 percent

**Includes 2,739 shares held by Mr. Gleason's wife as to which Mr. Gleason disclaims
beneficial ownership.
/TABLE
<PAGE>
<PAGE>4
<TABLE>
Robert F. Lanz
--------------
<CAPTION>
Nature of Number of Percent of Total Number
Ownership Shares of Outstanding Shares
- --------- --------- -----------------------
<S> <C> <C>
Sole Power to Vote 2,228.8471 *
or Direct the Vote

Shared Power to Vote 0 0%
or Direct the Vote

Sole Power to Dispose or 2,228.8471 *
to Direct the Disposition

Shared Power to Dispose or 0 0%
to Direct the Disposal

Total Beneficially Owned 2,228.8471 *

Mr. Lanz is a participant in the K Plus Plan and, pursuant to an election in effect since
February 15, 1994, he has directed that a portion of his elective contributions be invested in the
PTI Stock Fund. The Trustee of the K Plus Plan has acquired shares of Pacific Telecom
Common Stock with funds invested in the PTI Stock Fund within the past 60 days, 17.5682 of
which were allocated to Mr. Lanz's account effective as of March 6, 1995. Mr. Lanz has not
bought or sold or otherwise effected any other transactions in shares of Common Stock during the
past 60 days.
<FN>
__________________

* Less than 1 percent
/TABLE
<PAGE>
<PAGE>5
<TABLE>
Charles E. Robinson
-------------------
<CAPTION>
Nature of Number of Percent of Total Number
Ownership Shares of Outstanding Shares
- --------- --------- -----------------------
<S> <C> <C>
Sole Power to Vote 72,166.3071 *
or Direct the Vote

Shared Power to Vote 0 0%
or Direct the Vote

Sole Power to Dispose or 72,166.3071 *
to Direct the Disposition

Shared Power to Dispose or 0 0%
to Direct the Disposal

Total Beneficially Owned 72,166.3071 *

Mr. Robinson is a participant in the K Plus Plan and, pursuant to an election in effect since
January 3, 1990, he has directed that a portion of his elective contributions be invested in the PTI
Stock Fund. The Trustee of the K Plus Plan has acquired shares of Pacific Telecom Common
Stock with funds invested in the PTI Stock Fund within the past 60 days, 166.3223 of which were
allocated to Mr. Robinson's account effective as of March 6, 1995. In February 1995, Mr.
Robinson received a grant of 6,600 shares of restricted stock pursuant to the Pacific Telecom
Long-Term Incentive Plan 1994 Restatement, which shares are scheduled to vest over a four-year
period commencing February 15, 1996. Mr. Robinson has not bought or sold or otherwise
effected any other transactions in shares of Common Stock during the past 60 days.
<FN>
__________________

* Less than 1 percent
/TABLE
<PAGE>
<PAGE>6
<TABLE>
Nancy Wilgenbusch
-----------------
<CAPTION>
Nature of Number of Percent of Total Number
Ownership Shares of Outstanding Shares
- --------- --------- -----------------------
<S> <C> <C>
Sole Power to Vote 2,711 *
or Direct the Vote

Shared Power to Vote 0 0%
or Direct the Vote

Sole Power to Dispose or 2,711 *
to Direct the Disposition

Shared Power to Dispose or 0 0%
to Direct the Disposal

Total Beneficially Owned 2,711 *

Dr. Wilgenbusch has not bought or sold or otherwise effected any transactions in shares of
Common Stock during the past 60 days.
<FN>
__________________

* Less than 1 percent

/TABLE
<PAGE>
<PAGE>7
<TABLE>
Thomas J. Imeson
----------------
<CAPTION>
Nature of Number of Percent of Total Number
Ownership Shares of Outstanding Shares
- --------- --------- -----------------------
<S> <C> <C>
Sole Power to Vote 287.2779 *
or Direct the Vote

Shared Power to Vote 0 0%
or Direct the Vote

Sole Power to Dispose or 287.2779 *
to Direct the Disposition

Shared Power to Dispose or 0 0%
to Direct the Disposal

Total Beneficially Owned 287.2779 *

Mr. Imeson has not bought or sold or otherwise effected any transactions in shares of Common
Stock during the past 60 days.
<FN>
__________________

* Less than 1 percent

</TABLE>

EXHIBIT 3

AGREEMENT

AND

PLAN OF MERGER<PAGE>
<PAGE>i
TABLE OF CONTENTS

ARTICLE I THE MERGER. . . . . . . . . . . . . . . . . . 2
1.1 Effect of Merger . . . . . . . . . . . . . . . . . 3
1.2 Articles of Incorporation, etc.. . . . . . . . . . 3
1.2.1 Articles of Incorporation and Bylaws. . . . 3
1.2.2 Directors . . . . . . . . . . . . . . . . . 3
1.2.3 Officers. . . . . . . . . . . . . . . . . . 3
1.3 Conversion and Cancellation of Shares. . . . . . . 4
1.3.1 PTI Common Stock Held by Holdings . . . . . 4
1.3.2 PTI Common Stock Held by Minority
Shareholders. . . . . . . . . . . . . . . . . 4
1.3.3 Merger Sub Common Stock . . . . . . . . . . 4
1.3.4 Payment for Minority Stock. . . . . . . . . 5
1.3.5 Lost, Stolen or Destroyed Certificates. . . 6
1.3.6 No Further Rights or Transfers. . . . . . . 6
1.3.7 Dissenting Shareholders . . . . . . . . . . 7
1.4 Closing. . . . . . . . . . . . . . . . . . . . . . 7
1.5 Subsequent Actions . . . . . . . . . . . . . . . . 7

ARTICLE II REPRESENTATIONS AND WARRANTIES. . . . . . . . 8
2.1 Representations and Warranties of PTI. . . . . . . 8
2.1.1 Organization and Good Standing. . . . . . . 8
2.1.2 Capitalization. . . . . . . . . . . . . . . 8
2.1.3 Corporate Authority; Authorization. . . . . 9
2.1.4 Consents and Approvals. . . . . . . . . . . 9
2.1.5 Proxy Statement and Schedule 13E-3. . . . . 10
2.1.6 Company SEC Reports and Financial
Statements. . . . . . . . . . . . . . . . . . 11
2.1.7 Absence of Material Adverse Change. . . . . 12
2.1.8 Brokers and Finders . . . . . . . . . . . . 12
2.1.9 Fairness Opinions . . . . . . . . . . . . . 13
2.2 Representations and Warranties of Holdings and
Merger Sub . . . . . . . . . . . . . . . . . . . . 13
2.2.1 Organization and Good Standing. . . . . . . 13
2.2.2 Corporate Authority . . . . . . . . . . . . 13
2.2.3 Proxy Statement and Schedule 13E-3. . . . . 14
2.2.4 Required Approvals. . . . . . . . . . . . . 14
2.2.5 Prior Proposals and Offers; No Present
Intent to Sell. . . . . . . . . . . . . . . . 15
2.2.6 Financing . . . . . . . . . . . . . . . . . 16

ARTICLE III COVENANTS . . . . . . . . . . . . . . . . . . 16
3.1 Proxy Materials and Schedule 13E-3 . . . . . . . . 16
3.2 Shareholder Approval . . . . . . . . . . . . . . . 17
3.3 Acquisition Proposals. . . . . . . . . . . . . . . 18
3.4 Dissenters' Rights . . . . . . . . . . . . . . . . 18
3.5 Conduct of Business of PTI . . . . . . . . . . . . 18
3.6 Access and Information . . . . . . . . . . . . . . 20
3.7 Certain Filings, Consents and Arrangements . . . . 20
3.7.1 Consents. . . . . . . . . . . . . . . . . . 20
3.7.2 Filings . . . . . . . . . . . . . . . . . . 20
3.8 Indemnification and Insurance. . . . . . . . . . . 21
3.9 Dividend Policy. . . . . . . . . . . . . . . . . . 22
<PAGE>
<PAGE>ii
3.10 Notification of Certain Matters. . . . . . . . . . 23
3.11 Fees and Expenses. . . . . . . . . . . . . . . . . 23
3.12 Election of Directors. . . . . . . . . . . . . . . 23
3.13 Employee Benefits. . . . . . . . . . . . . . . . . 23
3.14 Additional Agreements. . . . . . . . . . . . . . . 23

ARTICLE IV CONDITIONS. . . . . . . . . . . . . . . . . . 24
4.1 Conditions to the Obligations of The Parties . . . 24
4.1.1 Shareholder Approval. . . . . . . . . . . . 24
4.1.2 No Injunction . . . . . . . . . . . . . . . 24
4.2 Conditions to Obligation of PTI. . . . . . . . . . 24
4.2.1 Representations, Warranties, and
Covenants . . . . . . . . . . . . . . . . . . 24
4.2.2 PacifiCorp Agreement. . . . . . . . . . . . 25
4.2.3 No Injunction.. . . . . . . . . . . . . . . 25
4.2.4 Fairness Opinions . . . . . . . . . . . . . 25
4.2.5 Consents and Approvals. . . . . . . . . . . 25
4.3 Conditions to Obligations of Holdings and Merger
Sub. . . . . . . . . . . . . . . . . . . . . . . . 26
4.3.1 Representations, Warranties, and
Covenants . . . . . . . . . . . . . . . . . . 26
4.3.2 No Injunction.. . . . . . . . . . . . . . . 26
4.3.3 Material Adverse Change . . . . . . . . . . 26
4.3.4 Consents and Approvals. . . . . . . . . . . 26

ARTICLE V TERMINATION . . . . . . . . . . . . . . . . . 27
5.1 Termination. . . . . . . . . . . . . . . . . . . . 27
5.1.1 Mutual Consent. . . . . . . . . . . . . . . 27
5.1.2 Failure of Merger to Occur by Certain
Date. . . . . . . . . . . . . . . . . . . . . 27
5.1.3 Actions Restraining the Merger. . . . . . . 27
5.1.4 Failure of Shareholders to Approve. . . . . 28
5.1.5 By PTI. . . . . . . . . . . . . . . . . . . 28
5.1.6 By Holdings . . . . . . . . . . . . . . . . 28
5.2 Effect of Termination. . . . . . . . . . . . . . . 28

ARTICLE VI MISCELLANEOUS AND GENERAL . . . . . . . . . . 29
6.1 Survival of Representations, Warranties and
Agreements . . . . . . . . . . . . . . . . . . . . 29
6.2 Waiver and Amendment . . . . . . . . . . . . . . . 29
6.3 Entire Agreement . . . . . . . . . . . . . . . . . 29
6.4 Headings . . . . . . . . . . . . . . . . . . . . . 30
6.5 Notices. . . . . . . . . . . . . . . . . . . . . . 30
6.6 Parties in Interest; Assignment. . . . . . . . . . 30
6.7 Specific Performance . . . . . . . . . . . . . . . 31
6.8 Public Statements. . . . . . . . . . . . . . . . . 31
6.9 Counterparts . . . . . . . . . . . . . . . . . . . 31
6.10 Choice of Law. . . . . . . . . . . . . . . . . . . 31
<PAGE>
<PAGE>
AGREEMENT AND
PLAN OF MERGER

AGREEMENT AND PLAN OF MERGER (the "Agreement") dated
as of March 9, 1995, by and among PACIFIC TELECOM, INC., a
Washington corporation ("PTI"), PACIFICORP HOLDINGS, INC., a
Delaware corporation ("Holdings"), and PXYZ CORPORATION, a
Washington corporation ("Merger Sub").

R E C I T A L S

A. Holdings, a direct wholly-owned subsidiary of
PacifiCorp, an Oregon corporation ("PacifiCorp"), owns
34,325,181 shares, or approximately 86.6 percent, of the issued
and outstanding common stock, no par value, of PTI ("PTI Common
Stock").

B. Merger Sub is a direct, wholly-owned subsidiary of
Holdings, formed solely for the purposes of the transactions
contemplated by this Agreement.

C. The Board of Directors of each of Holdings, Merger
Sub and PTI believes that it is in the best interest of each
respective corporation and their respective shareholders to
consummate the merger of Merger Sub with and into PTI pursuant
to the applicable provisions of the Washington Business
Corporation Act (the "WBCA") and in accordance with the terms
and subject to the conditions of this Agreement (the "Merger").

D. Based upon the unanimous recommendation of the
special committee of the Board of Directors of PTI (the
"Special Committee"), the Board of Directors of PTI has
approved the Merger, with PTI to be the surviving corporation
and a wholly-owned subsidiary of Holdings following the Merger,
upon the terms and subject to the conditions set forth herein
and has recommended approval of this Agreement and the Merger
by the shareholders of PTI.

<PAGE>
<PAGE>2

E. The Board of Directors of each of Holdings and Merger
Sub have approved this Agreement and the Merger, upon the terms
and conditions set forth herein.

F. Contemporaneous with the execution of this Agreement,
PacifiCorp is entering into an agreement in the form attached
hereto as Exhibit A (the "PacifiCorp Agreement") with PTI
pursuant to which PacifiCorp is assuming certain obligations in
connection with the transactions contemplated hereby.

AGREEMENT:

NOW, THEREFORE, in consideration of the mutual
representations, warranties, covenants, agreements and
conditions contained herein, the parties agree as follows:

ARTICLE I
THE MERGER

Pursuant to the WBCA, and subject to and in
accordance with the terms and conditions of this Agreement,
Merger Sub shall, at the Effective Time (as hereinafter
defined), be merged with and into PTI, the outstanding shares
of the capital stock of PTI held by Holdings shall be
cancelled, the outstanding shares of capital stock of PTI held
by shareholders other than Holdings (the "Minority
Shareholders") shall be converted into the right to receive the
Merger Consideration (as hereinafter defined), the outstanding
shares of the capital stock of Merger Sub shall be converted
into shares of the capital stock of PTI, all as described in
Section 1.3, and PTI shall execute Articles of Merger, to be
filed with the Secretary of State of the State of Washington on
the Closing Date (as hereinafter defined). The Merger shall
take effect (the "Effective Time") when, subject to and in
accordance with the terms and conditions of this Agreement,
Articles of Merger and such other documents as may be required
by the applicable provisions of the WBCA, in such form as are
required by and executed in accordance with the WBCA, are duly
filed with the Secretary of State of the State of Washington.
Such filings shall be made <PAGE>
<PAGE>3

as soon as practicable following the satisfaction or waiver of
the conditions set forth in Article IV of this Agreement.

1.1 Effect of Merger. At the Effective Time, Merger
Sub shall be merged with and into PTI in the manner and with
the effect provided by the WBCA, the separate corporate
existence of Merger Sub shall cease and thereupon Merger Sub
and PTI shall be a single corporation (the "Surviving
Corporation"). The outstanding shares of capital stock of PTI
held by Holdings shall be cancelled, the outstanding shares of
capital stock of PTI held by the Minority Shareholders shall be
converted into the right to receive the Merger Consideration,
and the outstanding shares of capital stock of Merger Sub shall
be converted into a like number of shares of the capital stock
of PTI, all on the basis, terms and conditions described in
Section 1.3.

1.2 Articles of Incorporation, etc. In addition to
the effects identified in Section 1.1:

1.2.1 Articles of Incorporation and Bylaws.
The Articles of Incorporation and Bylaws of PTI as in effect at
the Effective Time shall be the Articles of Incorporation and
Bylaws of the Surviving Corporation;

1.2.2 Directors. The directors of PTI at the
Effective Time shall be the directors of the Surviving
Corporation, until their respective successors shall be duly
elected or appointed and qualified; and

1.2.3 Officers. The officers of PTI at the
Effective Time shall be the initial officers of the Surviving
Corporation and will hold office from the Effective Time until
their respective successors are duly elected and qualified.<PAGE>
<PAGE>4

1.3 Conversion and Cancellation of Shares. The
manner and basis of cancelling the shares of PTI or converting
them into the right to receive cash and the manner and basis of
converting the shares of Merger Sub into shares of PTI shall be
as follows:

1.3.1 PTI Common Stock Held by Holdings. Each
of the 34,325,181 shares of PTI Common Stock held by Holdings
("Holdings Stock"), outstanding immediately before the
Effective Time, shall by virtue of the Merger and without any
action on the part of Holdings as the holder thereof, be
cancelled without payment of any consideration therefor and
shall cease to exist.

1.3.2 PTI Common Stock Held by Minority
Shareholders. Each share of PTI Common Stock held by the
Minority Shareholders (including, without limitation, PTI
Common Stock held in escrow for the benefit of participants in
PTI's Non-Employee Director Stock Compensation Plan and PTI's
Long-Term Incentive Plan 1994 Restatement) ("Minority Stock"),
outstanding immediately before the Effective Time (other than
shares with respect to which the holder thereof has properly
perfected dissenters' rights in accordance with the WBCA),
shall by virtue of the Merger and without any action on the
part of the holder thereof, be converted into the right to the
Merger Consideration in accordance with Section 1.3.4.

1.3.3 Merger Sub Common Stock. Each of the 100
shares of Merger Sub Common Stock, ("Merger Sub Stock"), issued
and outstanding immediately before the Effective Time shall, by
virtue of the Merger and without any action on the part of the
holder thereof, be converted into and become one share of PTI
Common Stock.<PAGE>
<PAGE>5

1.3.4 Payment for Minority Stock. Prior to the
Effective Time, Holdings shall designate a bank or trust
company with capital, surplus and undivided profits of at least
$100 million to act as the payment agent (the "Payment Agent")
in connection with the Merger. At or prior to the Effective
Time, Holdings shall take all steps necessary to enable and
cause the Payment Agent to receive the funds (the "Fund")
necessary to make the payments of Merger Consideration provided
for by this Agreement. Out of the Fund, the Payment Agent
shall, pursuant to irrevocable instructions, make the payments
of Merger Consideration provided for by this Agreement. The
Fund shall not be used for any other purpose. The Payment
Agent may invest portions of the Fund, as directed by Holdings
(so long as such instructions do not impair the Payment Agent's
ability to make the payments of Merger Consideration provided
for by this Agreement or otherwise impair the rights of holders
of Minority Stock). Any net earnings resulting from, or
interest or income produced by, such investments shall be paid
to the Surviving Corporation as and when requested by Holdings.
Holdings shall replace any monies lost through any investment
pursuant to this <PAGE>
<PAGE>6

Section 1.3.4. Promptly after the Effective Time, Holdings
shall cause the Payment Agent to mail to each record holder of
Minority Stock as of immediately prior to the Effective Time a
form of letter of transmittal and instructions for use in
effecting the surrender of certificates representing Minority
Stock for payment. After the Effective Time, each holder of
shares of Minority Stock outstanding immediately prior to the
Effective Time shall, upon surrender for cancellation of a
certificate or certificates representing such shares to the
Payment Agent, together with such letter of transmittal duly
executed and completed in accordance with the instructions
thereto, be entitled to receive an amount equal to $30.00 in
cash for each share of Minority Stock converted pursuant to the
provisions of Section 1.3.2 (the "Merger Consideration").
Subject to full compliance with this Agreement, any cash
provided to the Payment Agent pursuant to this Section 1.3.4
and not exchanged for certificates representing Minority Stock
within 180 days after the Effective Time will be returned by
the Payment Agent to the Surviving Corporation, which
thereafter shall act as the payment agent. Notwithstanding the
foregoing, neither the Payment Agent nor any party to this
Agreement shall be liable to any holder of Minority Stock for
any Merger Consideration delivered to a public official
pursuant to any applicable abandoned property, escheat or
similar law.

1.3.5 Lost, Stolen or Destroyed Certificates.
In the event that any certificate representing Minority Stock
shall have been lost, stolen or destroyed, upon the making of
an affidavit of that fact by the person claiming such
certificate to be lost, stolen or destroyed, Holdings shall, or
shall cause the Payment Agent to, issue in exchange for such
lost, stolen or destroyed certificate the Merger Consideration
deliverable in respect thereof as determined in accordance with
this Agreement; provided, however, that Holdings may, in its
sole discretion and as a condition precedent to the issuance
thereof, require the owner of such lost, stolen or destroyed
certificate to give Holdings a bond in such sum as it may
reasonably direct as indemnity against any claim that may be
made against Holdings with respect to the certificate alleged
to have been lost, stolen or destroyed.

1.3.6 No Further Rights or Transfers. At and
after the Effective Time, each holder of a certificate that
represented Minority Stock immediately prior to the Effective
Time shall cease to have any rights as a shareholder of PTI,
except for the right to surrender his or her certificate or
certificates in exchange for the Merger Consideration or to
perfect his or her right to receive payment for shares of
Minority Stock pursuant to RCW 23B.13.010 et seq. and Section
1.3.7 hereof (if such holder has validly exercised and
perfected the dissenters rights provided thereby), and there
shall be no transfers on the stock books of the Surviving
Corporation of any shares of PTI Common Stock which were
outstanding immediately prior to the Effective Time. If, <PAGE>
<PAGE>7

after the Effective Time, certificates formerly representing
Minority Stock are presented to the Surviving Corporation, they
shall be cancelled and exchanged solely for the Merger
Consideration.

1.3.7 Dissenting Shareholders. Shares of
Minority Stock outstanding immediately prior to the Effective
Time and held by shareholders who have validly perfected
dissenter's rights in accordance with RCW 23B.13.010 et seq.
("Dissenting Shares") shall not be converted as described in
Section 1.3.2 but shall from and after the Effective Time
represent only the right to receive such consideration as may
be determined to be due in accordance with RCW 23B.13.010 et
seq. Each holder of Dissenting Shares who becomes entitled to
payment for his Dissenting Shares in accordance with RCW
23B.13.010 et seq. shall receive payment therefor from the
Surviving Corporation after the Effective Time (but only after
the amount thereof shall have been agreed upon or finally
determined pursuant to RCW 23B.13.010 et seq.).
Notwithstanding the foregoing, if any holder of Dissenting
Shares shall fail to perfect, effectively withdraw or otherwise
lose such rights either before or after the Effective Time,
such holder's Dissenting Shares shall be converted into the
right to receive the Merger Consideration in accordance with
the provisions of Section 1.3.2.

1.4 Closing. The closing of the Merger (the
"Closing") shall take place at the offices of Stoel Rives Boley
Jones & Grey, 900 SW Fifth Avenue, Suite 2300, Portland, Oregon
97204, at 10:00 a.m. on the date when the last of the
conditions set forth in Article IV hereof (other than
conditions that by their terms are to occur at Closing) shall
have been fulfilled or waived or on such other date as PTI and
Holdings may agree (the "Closing Date").

1.5 Subsequent Actions. If, at any time after the
Effective Time, the Surviving Corporation shall reasonably
determine that any deeds, bills of sale, assignments,
assurances, or any other actions or things are necessary or
desirable to vest, <PAGE>
<PAGE>8

perfect, or confirm of record or otherwise in the Surviving
Corporation its right, title, or interest in, to, or under any
of the rights, properties, or assets of, PTI or Merger Sub
acquired or to be acquired by the Surviving Corporation as a
result of, or in connection with, the Merger or otherwise to
carry out this Agreement, the officers and directors of the
Surviving Corporation shall be authorized to execute and
deliver, in the name and on behalf of PTI or Merger Sub, or
otherwise, all such deeds, bills of sale, assignments, and
assurances, and to take and do, in the name and on behalf of
PTI or Merger Sub or otherwise, all such other actions and
things as may be necessary or desirable to vest, perfect, or
confirm any and all right, title, and interest in, to, and
under such rights, properties, or assets in the Surviving
Corporation or otherwise to carry out this Agreement.

ARTICLE II
REPRESENTATIONS AND WARRANTIES

2.1 Representations and Warranties of PTI. PTI
hereby represents and warrants to Holdings and Merger Sub that:

2.1.1 Organization and Good Standing. Each of
PTI and its subsidiaries is a corporation duly organized,
validly existing and in good standing under the laws of the
jurisdiction of its incorporation and is duly qualified in good
standing as a foreign corporation in each jurisdiction where
the properties owned, leased or operated, or the business
conducted, by it require such qualification, except where the
failure to be so qualified would not have a material adverse
effect on PTI and its subsidiaries taken as a whole. Each of
PTI and its subsidiaries has all requisite corporate power and
authority to own, lease and operate its properties and to carry
on its business as it is now being conducted.

2.1.2 Capitalization. The authorized capital
stock of PTI consists of (i) 200,000,000 shares of common
stock, no par value, of which at February 28, <PAGE>
<PAGE>9

1995, there were 39,616,123 shares issued and outstanding (of
which 34,325,181 were held by Holdings and 5,290,942
constituted Minority Stock) and (ii) 152,000 shares of
Cumulative Preferred Stock, $25.00 par value, of which at
February 28, 1995, there were no shares outstanding. All
issued and outstanding shares of Common Stock are validly
issued, fully paid, nonassessable and free of preemptive
rights.

2.1.3 Corporate Authority; Authorization. PTI
has the corporate power and authority to execute and deliver
this Agreement and to consummate the transactions contemplated
hereby. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby have been
duly and validly authorized and approved by the Board of
Directors of PTI and no other corporate proceedings on the part
of PTI or any subsidiary of PTI are necessary to authorize this
Agreement and, except for the approval of this Agreement by its
shareholders and the filing of the Articles of Merger pursuant
to the WBCA, no other corporate proceedings on the part of PTI
are necessary to consummate the transactions contemplated by
this Agreement. This Agreement has been duly and validly
executed and delivered by PTI and constitutes a valid and
binding obligation of PTI enforceable against PTI in accordance
with its terms, except as enforcement may be affected by
applicable bankruptcy, insolvency, reorganization, moratorium,
or similar laws affecting the enforcement of creditors' rights
generally and except that the availability of the equitable
remedies of specific performance and injunctive relief are
subject to the discretion of the court before which any
proceeding may be brought.

2.1.4 Consents and Approvals. Except for
compliance with applicable requirements of the Securities
Exchange Act of 1934 (the "Exchange Act"), the securities laws
of the various states, shareholder approval of the Merger, the
filing of the Articles of Merger pursuant to the WBCA and any
necessary consents from the Federal Communications Commission
and any state telecommunications regulatory authorities, no <PAGE>
<PAGE>10

filing with, and no permit, authorization, consent or approval
of, any public body or authority is necessary for the execution
and delivery by PTI of this Agreement or the consummation by
PTI of the transactions contemplated by this Agreement,
excluding from the foregoing filings, permits, authorizations,
consents or approvals that, either individually or in the
aggregate, would not have a material adverse effect on the
business, operations, financial condition or prospects of PTI
and its subsidiaries taken as a whole. Neither the execution
and delivery of this Agreement nor the consummation of the
transactions contemplated hereby will (i) conflict with or
result in any breach of any provision of the articles of
incorporation or bylaws of PTI or any of its subsidiaries, (ii)
result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a default (or give
rise to any right of termination, cancellation or acceleration)
under, any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, license, permit, agreement or other
instrument or obligation to which PTI or any of its
subsidiaries is a party or by which any of them or any of their
properties or assets may be bound or (iii) violate any order,
writ, injunction, decree, statute, rule or regulation
applicable to PTI, any of its subsidiaries or any of their
properties or assets, excluding from the foregoing clauses (ii)
and (iii) violations, breaches or defaults that, either
individually or in the aggregate, would not have a material
adverse effect on the business, operations, financial condition
or prospects of PTI and its subsidiaries taken as a whole.

2.1.5 Proxy Statement and Schedule 13E-3. None
of the information supplied or to be supplied by PTI and the
Special Committee for inclusion in the Rule 13e-3 Transaction
Statement to be filed pursuant to the Exchange Act in
connection with the transactions contemplated hereby (the
"Schedule 13E-3") or the proxy statement (the "Proxy
Statement") to be filed pursuant to the Exchange Act with
respect to the meeting of shareholders (the "Shareholder
Meeting") called for the purpose of <PAGE>
<PAGE>11

approving this Agreement and the transactions contemplated
hereby, which, unless Holdings otherwise approves in writing,
will be the 1995 Annual Meeting of Shareholders of PTI, and any
amendments thereof or supplements thereto, will, on the
respective dates such materials are filed with the Securities
and Exchange Commission ("SEC"), at the time of the mailing of
the Proxy Statement or any amendment or supplement thereto, to
shareholders of PTI, at the time of the Shareholder Meeting and
at the Effective Time, contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements
made therein, in light of the circumstances under which they
were made, not misleading. If at any time prior to the
Effective Time any event with respect to PTI or its officers
and directors should occur which is required to be described in
an amendment of, or a supplement to, the Proxy Statement or the
Schedule 13E-3, such event shall be so described, and such
amendment or supplement shall be promptly filed with the SEC
and, as required by law, disseminated to the shareholders of
PTI. The Schedule 13E-3 will comply (with respect to PTI) in
all material respects, as to form, with the applicable
requirements of each of the Exchange Act and the respective
rules and regulations thereunder.

2.1.6 Company SEC Reports and Financial
Statements. PTI has heretofore furnished to Holdings complete
copies of all registration statements, reports, and other
required filings, including all amendments thereto, filed since
January 1, 1992 and on or before the date hereof with the SEC
(collectively, the "Company SEC Reports"). Since January 1,
1992, PTI has timely filed all registration statements, reports
and other filings required to be filed with the SEC under the
rules and regulations of the SEC. The Company SEC Reports,
including without limitation, any financial statements or
schedules included therein, when filed (a) did not contain any
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements made therein, in light of the circumstances in which
they were made, <PAGE>
<PAGE>12

not misleading and (b) complied in all material respects with
the applicable requirements of the Securities Act of 1933 (the
"Securities Act") and the Exchange Act, as the case may be, and
the applicable rules and regulations thereunder. Other than as
disclosed by PTI in its filings with the SEC, each of the
financial statements of PTI (including any related notes and
schedules) contained in the Company SEC Reports comply as to
form in all material respects with applicable accounting
requirements and with the published rules and regulations of
the SEC with respect thereto, have been prepared in accordance
with generally accepted accounting principles ("GAAP") applied
on a consistent basis throughout the periods indicated (except
as otherwise indicated in such financial statements or in the
notes thereto or, in the case of the unaudited interim
statements, as permitted by the requirements of Form 10-Q) and
fairly present in all material respects (subject, in the case
of the unaudited statements, to normal recurring audit
adjustments) the consolidated financial position of PTI and its
consolidated subsidiaries as of the dates thereof and the
consolidated results of their operations and cash flows for the
periods then ended in accordance with GAAP.

2.1.7 Absence of Material Adverse Change.
Since September 30, 1994 and except as disclosed in the Company
SEC Reports or as otherwise disclosed to a responsible officer
of Holdings or PacifiCorp on or before the date hereof, here
has not been any material adverse change in the business,
operations, properties, assets, liabilities or condition
(financial or otherwise) of PTI and its subsidiaries taken as a
whole or any declaration of any dividend or other distribution
with respect to PTI's capital stock, other than regular
quarterly dividends paid in respect of PTI Common Stock.

2.1.8 Brokers and Finders. Neither PTI nor any
officer, director or employee of PTI has employed any broker,
finder or investment banker, or incurred any liability for any
brokerage or investment banking fees, commissions or finder's
fees, in connection with the transactions contemplated by this
Agreement, except that Smith <PAGE>
<PAGE>13

Barney, Inc. ("Smith Barney") has been engaged as the financial
advisor to the Special Committee and CS First Boston
Corporation ("CS First Boston") has been engaged to render an
opinion as to whether the Merger Consideration is fair, from a
financial point of view, to the Minority Shareholders, pursuant
to engagement letters that have been disclosed to Holdings.

2.1.9 Fairness Opinions. The Special Committee
has received the written opinion of each of Smith Barney and CS
First Boston (the "Fairness Opinions"), to the effect that, as
of the respective dates of such opinions, the Merger
Consideration is fair, from a financial point of view, to the
Minority Shareholders.

2.2 Representations and Warranties of Holdings and
Merger Sub. Holdings and Merger Sub hereby represent and
warrant to PTI that:

2.2.1 Organization and Good Standing. Holdings
and Merger Sub are corporations duly organized, validly
existing and in good standing under the laws of the States of
Delaware and Washington, respectively. Each of Holdings and
Merger Sub has all requisite corporate power and authority to
own and operate its properties and to carry on its business as
now being conducted.

2.2.2 Corporate Authority. Each of Holdings
and Merger Sub has the corporate power and authority to execute
and deliver this Agreement and to consummate the transactions
contemplated hereby. The execution and delivery of this
Agreement and the consummation of the transactions contemplated
hereby have been duly and validly authorized and approved by
the Board of Directors of Holdings and Merger Sub and the sole
shareholder of Merger Sub and no other corporate proceedings on
the part of Holdings or Merger Sub are necessary to authorize
this Agreement or the consummation of the transactions
contemplated hereby. This Agreement has been duly and validly
executed and delivered by each of Holdings and Merger Sub and
constitutes a valid and binding agreement of Holdings and
Merger Sub, enforceable against each of <PAGE>
<PAGE>14

them in accordance with its terms, except as enforcement may be
affected by applicable bankruptcy, insolvency, reorganization,
moratorium or similar laws affecting the enforcement of
creditors' rights generally and except that the availability of
the equitable remedies of specific performance and injunctive
relief are subject to the discretion of the court before which
any proceeding may be brought.

2.2.3 Proxy Statement and Schedule 13E-3. None
of the information supplied or to be supplied by PacifiCorp,
Holdings or Merger Sub for inclusion in the Schedule 13E-3 or
the Proxy Statement and any amendments thereof or supplements
thereto will, on the respective dates such materials are filed
with the SEC, at the time of the mailing of such Proxy
Statement or any amendment or supplement thereto to
shareholders of PTI, at the time of the Shareholder Meeting and
at the Effective Time, contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements
made therein, in light of the circumstances under which they
were made, not misleading. If at any time prior to the
Effective Time any event with respect to PacifiCorp, Holdings,
Merger Sub or any of their respective officers, directors or
affiliates should occur which is required to be described in an
amendment of, or a supplement to, the Proxy Statement or the
Schedule 13E-3, such event shall be so described, and such
amendment or supplement shall be promptly filed with the SEC
and, as required by law, disseminated to the shareholders of
PTI. The Schedule 13E-3 will comply (with respect to
PacifiCorp, Holdings, Merger Sub and their respective officers,
directors and affiliates) in all material respects, as to form,
with the applicable requirements of each of the Exchange Act
and the respective rules and regulations thereunder.

2.2.4 Required Approvals. Except for
compliance with the applicable requirements of the Exchange
Act, the securities laws of the various states and the filing
of the Articles of Merger pursuant to the WBCA, no filing with,
and no <PAGE>
<PAGE>15

permit, authorization, consent or approval of, any public body
is necessary for the execution and delivery by Holdings or
Merger Sub of this Agreement or the consummation by Holdings or
Merger Sub of the transactions contemplated by this Agreement.
Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby will (i)
conflict with or result in any breach of any provision of the
articles or certificate of incorporation (as the case may be)
or bylaws of PacifiCorp, Holdings or Merger Sub, (ii) result in
a violation or breach of, or constitute (with or without due
notice or lapse of time or both) a default (or give rise to any
right of termination, cancellation or acceleration) under, any
of the terms, conditions or provisions of any note, bond,
mortgage, indenture, license, permit, agreement or other
instrument or obligation to which PacifiCorp, Holdings or
Merger Sub is a party or by which any of them or any of their
respective properties or assets may be bound or (iii) violate
any order, writ, injunction, decree, statute, rule or
regulation applicable to PacifiCorp, Holdings or Merger Sub, or
any of their respective properties or assets, excluding from
the foregoing clauses (ii) and (iii) violations, breaches or
defaults that, either individually or in the aggregate, would
not have a material adverse effect on the business, operations,
financial condition or prospects of such entity and its
subsidiaries taken as a whole.

2.2.5 Prior Proposals and Offers; No Present
Intent to Sell. Since January 1, 1993, to the best knowledge
of Holdings after due inquiry, none of PacifiCorp, Holdings or
Merger Sub has received any "proposal" or offer to purchase, or
solicited any proposal or offer to purchase, any material
portion of the stock or assets of PTI, other than transactions
disclosed in the Company SEC Reports (including, without
limitation, the sale of Alascom). For purposes of this Section
2.2.5 a "proposal" may be either written or oral, but must have
included a proposed or suggested price or possible range of
prices and, if made on behalf of a corporation, must have been
made by a <PAGE>
<PAGE>16

responsible officer or representative of that corporation.
Neither PacifiCorp nor Holdings has any current plan or intent
to sell or otherwise dispose of any material portion of the
stock or assets of PTI, other than transactions disclosed in
the Company SEC Reports (including, without limitation, the
sale of Alascom). The Schedule 13D of PacifiCorp filed in
respect of Holdings' ownership interest in PTI, as amended by
the form of amendment attached hereto as Exhibit B (the "13D
Amendment"), will fully comply with all of the requirements of
such Schedule including, without limitation, Item 4 thereof.
The 13D Amendment will be filed promptly after the execution of
this Agreement.

2.2.6 Financing. Holdings has available to it
the funds necessary to consummate the Merger and the other
transactions contemplated by this Agreement.

ARTICLE III
COVENANTS

3.1 Proxy Materials and Schedule 13E-3. As soon as
practicable after the date hereof, PTI will prepare and,
subject to prior approval by Holdings, file the Proxy Statement
and accompanying proxy materials in preliminary form, and PTI
and PacifiCorp, Holdings and Merger Sub will prepare and file
the Schedule 13E-3 with the SEC pursuant to the Exchange Act.
PTI will provide Holdings and Merger Sub with a reasonable
opportunity to review and approve the Proxy Statement and any
amendments or supplements thereto prior to filing them with the
SEC. Holdings and Merger Sub will provide PTI with a
reasonable opportunity to review and approve the Schedule 13E-3
and any amendments thereto prior to filing with the SEC. PTI
will use its best efforts to, as soon as is practicable, have
the Proxy Statement cleared by the SEC. PTI, Holdings and
Merger Sub will use their respective best efforts to, as soon
as is practicable, have the Schedule 13E-3 cleared by the SEC.
As soon as is practicable, PTI will distribute to the
shareholders of PTI and file with the SEC the Proxy Statement
and accompanying <PAGE>
<PAGE>17

materials in definitive form and Holdings, Merger Sub and PTI
will file with the SEC the Schedule 13E-3, as amended. Each
party to this Agreement shall, and shall cause its respective
officers, directors and affiliates to, cooperate fully with
each other in responding promptly to any comments of the SEC in
respect of any of the filings made by such persons with the SEC
in connection with the transactions contemplated by this
Agreement.

3.2 Shareholder Approval. PTI will take all action
necessary in accordance with applicable law and its governing
instruments to call, give notice of, convene, and hold the
Shareholder Meeting as promptly as practicable to consider and
vote upon the approvals of this Agreement, the Merger and such
other matters as are required or contemplated by this
Agreement. In order to facilitate the solicitation of Minority
Shareholders at the Shareholder Meeting, PTI shall retain a
proxy solicitation firm of national reputation and reasonably
acceptable to Holdings to assist in the solicitation of proxies
and shall permit Holdings to participate in the solicitation
process. The Special Committee has unanimously recommended to
the Board of Directors of PTI that the Merger is fair to and in
the best interests of the Minority Shareholders. Based upon
the recommendation of the Special Committee, the Board of
Directors of PTI has determined by a unanimous vote (except for
possible abstention by the director who also serves as a
director of PacifiCorp) that this Agreement is advisable and in
the best interests of the Minority Shareholders and recommends,
and subject to their respective fiduciary duties, (i) shall
continue to recommend, to the Minority Shareholders the
adoption and approval of this Agreement and the transactions
contemplated hereby and (ii) shall use their respective best
efforts to obtain the necessary approvals by its shareholders
of this Agreement and the transactions contemplated hereby.
Holdings and Merger Sub have each determined that the
transactions contemplated by this Agreement are fair to the
Minority Shareholders.

<PAGE>
<PAGE>18

3.3 Acquisition Proposals. PTI will not, directly
or indirectly, through any officer, director, agent or
otherwise, solicit, initiate or encourage submission of
proposals or offers from any person (including any of its
officers or employees) relating to any acquisition or purchase
of all or a substantial portion of the assets of, or any equity
interest in, PTI or any of its subsidiaries (other than sales
of assets in the ordinary course of business which, in the
aggregate, do not involve a substantial portion of the assets
of PTI or any of its subsidiaries or sales disclosed in the
Company SEC Reports including, without limitation, the sale of
Alascom) or any business combination with PTI or any of its
subsidiaries, or, subject to fiduciary duties under applicable
law as advised by counsel, participate in any negotiations
regarding, or furnish to any other person any information with
respect to, or otherwise cooperate in any way with, or assist
or participate in, facilitate or encourage, any effort or
attempt by any other person to do or seek any of the foregoing.
PTI represents and warrants that, as of the date of this
Agreement, no such negotiations or activities are in process
with respect to the foregoing. PTI shall promptly notify
Holdings if any such proposal or offer, or any inquiry or
contact with any person with respect thereto, is made.

3.4 Dissenters' Rights. PTI shall not settle or
compromise any claim for dissenters' rights in respect of the
Merger without the prior written consent of Holdings.

3.5 Conduct of Business of PTI. During the period
from the date of this Agreement to the Effective Time, except
as specifically contemplated by this Agreement or as previously
disclosed in the Company SEC Reports or otherwise approved in
writing by Holdings, PTI and its subsidiaries shall not:

(a) conduct their respective businesses except
in the ordinary course of business and consistent with past
practice;

<PAGE>
<PAGE>19

(b) propose or adopt any amendments to its
Articles of Incorporation or Bylaws or make any change in the
Board of Directors of PTI except as may be required to comply
with Section 3.12 of this Agreement;

(c) issue, sell or repurchase, or authorize or
propose the issuance, sale or repurchase of any shares of its
capital stock or any other securities or issue any securities
convertible into or exchangeable for, or options, warrants to
purchase, rights to subscribe for, calls or commitments of any
character whatsoever relating to, or enter into any agreement,
understanding or arrangement with respect to the issuance of,
any of its shares of capital stock or any other securities
(including securities of others), other than pursuant to the
PacifiCorp K Plus and Employee Stock Ownership Plan, or enter
into any agreement, understanding or arrangement with respect
to the purchase or voting of shares of its capital stock, or
adjust, split, combine or reclassify any of its securities, or
make any other changes in its capital structure;

(d) declare, set aside, pay or make any
dividend or other distribution or payment (whether in cash,
stock or property) with respect to, or purchase or redeem, any
shares of the capital stock of PTI, except for regular
quarterly cash dividends of no more than $.33 per share;

(e) take any action with respect to the grant
of any severance or termination pay (otherwise than pursuant to
policies or agreements of PTI or any of its subsidiaries in
effect on the date hereof) or with respect to any increase of
benefits payable under its severance or termination pay
policies in effect on the date hereof; or

(f) except for salary increases or other
employee benefit arrangements made in the ordinary course of
business, adopt or amend any bonus, profit sharing,
compensation, pension, retirement, deferred compensation,
severance, employment or other employee benefit plan,
agreement, trust, fund or arrangement for the benefit or
welfare of any employee.

<PAGE>
<PAGE>20

3.6 Access and Information. PTI shall and shall
cause its subsidiaries to give to Holdings and Merger Sub and
their respective representatives full access to all the
premises and books and records of PTI and its subsidiaries and
shall cause its officers and officers of its subsidiaries and
their independent auditors to furnish to such persons such
financial and operating data and other information, including
access to the working papers of its independent auditors, with
respect to its business and properties as Holdings shall from
time to time reasonably request. No investigation pursuant to
this Section 3.6 shall affect or be deemed to modify any
representations or warranties made in this Agreement or the
conditions to the obligations of the parties to consummate the
Merger.

3.7 Certain Filings, Consents and Arrangements.

3.7.1 Consents. Holdings, Merger Sub and PTI
shall use their respective best efforts to obtain any necessary
consents, permits, authorizations, approvals and waivers to
permit the consummation of the transactions contemplated by
this Agreement, provided that PTI shall not, without the
consent of Holdings (which consent shall not be unreasonably
withheld), agree to any amendment to any material instrument or
agreement to which it is a party.

3.7.2 Filings. Holdings, Merger Sub and PTI
shall cooperate with one another (i) in promptly determining
whether any filings are required to be made or consents,
approvals, permits or authorizations are required to be
obtained under any federal, state or foreign law or regulation
or any consents, approvals or waivers are required to be
obtained from other parties to loan agreements or other
agreements or instruments material to PTI's business in
connection with the consummation of the Merger and (ii) in
promptly making any such filings, furnishing information
required in connection therewith and seeking timely to obtain
any such consents, permits, authorizations, approvals or
waivers.

<PAGE>
<PAGE>21

3.8 Indemnification and Insurance.

(a) From and after the Effective Time, the
Surviving Corporation shall maintain, and Holdings agrees to
cause the Surviving Corporation to maintain for a period of at
least six years from the Effective Time for the benefit of
PTI's current directors and officers, (i) director and officer
liability insurance providing at least the same amounts and
coverage with respect to PTI's current directors and officers
as the current policies maintained by or on behalf of PTI, and
containing terms and conditions which are no less advantageous
with respect to matters existing or occurring on or prior to
the Effective Time (or, with respect to matters arising from or
in connection with Section 1.5 hereof, subsequent to the
Effective Time), and in the event any claim is made against
present directors of PTI that is covered, in whole or in part,
or potentially so covered by insurance, the Surviving
Corporation and Holdings shall do nothing that would forfeit,
jeopardize, restrict or limit the insurance coverage available
for that claim until the final disposition of that claim;
provided, however, that if the cost of maintaining such
insurance exceeds the current cost related to providing such
insurance (the "Current Cost") by more than twice the Current
Cost, then the Surviving Corporation shall maintain and
Holdings agrees to cause the Surviving Corporation to maintain
such director and officer liability insurance with the maximum
amount of coverage obtainable at twice such Current Cost, and
(ii) all rights to indemnification now existing in favor of the
present directors and officers of PTI and its respective
subsidiaries as provided in their respective articles of
incorporation or bylaws or otherwise in effect on the date
hereof (other than pursuant to this Agreement) shall survive
the Merger for a period of six years; provided, however, that
all such rights to indemnification with respect to any claim
asserted, made or originated prior to the expiration of such
six-year period shall survive until the final disposition of
such Claim (as hereinafter defined), and that during such
period, the Articles of Incorporation and <PAGE>
<PAGE>22

Bylaws of the Surviving Corporation shall not be amended to
reduce or limit the rights of indemnity of the present
directors and officers of PTI, or the ability of the Surviving
Corporation to indemnify them, nor to hinder, delay or make
more difficult the exercise of such rights of indemnity or the
ability to indemnify.

(b) Without limiting the foregoing, in any case in
which approval by the Surviving Corporation is required to
effectuate any indemnification under this Section 3.8, Holdings
shall cause the Surviving Corporation to direct, at the
election of the director of PTI seeking indemnification
hereunder, that the determination of any such approval shall be
made by independent counsel acceptable to Holdings selected by
such director of PTI seeking indemnification hereunder.

(c) This Section 3.8 shall survive the consummation
of the Merger. The provisions of this Section 3.8 are intended
to be for the benefit of, and shall be enforceable by the
present directors or officers of PTI, as the case may be. The
rights provided under this Section 3.8 shall be in addition to,
and not in lieu of, any rights to indemnity which any party may
have under the Articles of Incorporation or Bylaws of PTI or
the Surviving Corporation or any other agreements.

(d) An indemnified party under this Section 3.8
shall be free to determine, in such party's sole discretion,
which of the sources of indemnification or insurance available
hereunder that such party desires to pursue without in any
manner waiving any rights against other sources not initially
pursued. In addition, this Section 3.8 is not intended to
release or limit any insurer from the obligations undertaken by
it in any policy of insurance.

3.9 Dividend Policy. During the period from the
date of this Agreement to the Effective Time, Holdings shall
not take any action to cause PTI to make any dividend or other
distribution or payment to Holdings with respect to Holdings
Stock otherwise than in accordance with PTI's existing dividend
policies.

<PAGE>
<PAGE>23

3.10 Notification of Certain Matters. Each of PTI
and Holdings shall give prompt notice to the other of (i) any
claims, actions, proceedings or investigations commenced or, to
the best of its knowledge, threatened, involving or affecting
the notifying party or any of its property or assets, that
relate to the Merger, (ii) the occurrence, or failure to occur,
of any event that would be likely to cause any representation
or warranty of the notifying party contained in this Agreement
to be untrue or inaccurate in any material respect, and (iii)
any material failure of the notifying party or of any officer,
director, employee or agent thereof, to comply with or satisfy
any covenant, condition or agreement to be complied with or
satisfied by it hereunder. No such notification shall affect
the representations or warranties of the parties or the
conditions to the obligations of the parties hereunder.

3.11 Fees and Expenses. All costs and expenses
incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such
expenses (including, in the case of PTI, the costs of printing
and mailing the Proxy Statement), whether or not the Merger is
consummated.

3.12 Election of Directors. PTI agrees to take all
actions requested by Holdings to cause to be elected to PTI's
Board of Directors at the Shareholder Meeting such additional
directors as may be designated by Holdings.

3.13 Employee Benefits. Holdings agrees to honor,
from and after the Effective Time, in accordance with its terms
as in effect on the date of this Agreement, the Pacific
Telecom, Inc. Executive Officer Severance Plan effective
January 1, 1994.

3.14 Additional Agreements. Subject to the terms and
conditions hereof, each party shall use its best efforts
promptly to take, or cause to be taken, all actions and
promptly to do, or cause to be done, all things necessary,
proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by
this Agreement.

<PAGE>
<PAGE>24

ARTICLE IV
CONDITIONS

4.1 Conditions to the Obligations of The Parties.
The respective obligations of PTI, Holdings, and Merger Sub to
consummate the transactions contemplated by this Agreement are
subject to the satisfaction or waiver at or before the Closing
of each of the following conditions:

4.1.1 Shareholder Approval. This Agreement and
the Merger shall have been duly adopted and approved (A) by the
affirmative vote of the holders of at least a majority of the
Minority Stock and (B) by the requisite vote of the
shareholders of PTI in accordance with applicable law and its
Articles of Incorporation and Bylaws.

4.1.2 No Injunction. The consummation of the
Merger shall not be precluded by any order or injunction of a
court of competent jurisdiction (each party agreeing to use its
best efforts to have any such order reversed or injunction
lifted), and there shall not have been any action taken or any
statute, rule or regulation enacted, promulgated or deemed
applicable to the Merger by any government or governmental or
other regulatory agency, domestic or foreign, that makes
consummation of the Merger illegal.

4.2 Conditions to Obligation of PTI. The obligation
of PTI to consummate the transactions contemplated by this
Agreement is subject to the satisfaction or waiver at or before
the Closing of the following additional conditions:

4.2.1 Representations, Warranties, and
Covenants. The representations and warranties of Holdings and
Merger Sub, including, without limitation, those relating to
PacifiCorp, contained in this Agreement shall be correct in all
material respects (a) at the date of this Agreement, and (b) on
and as of the Closing Date with the same effect as though made
on and as of such date, Holdings and Merger Sub shall have <PAGE>
<PAGE>25

performed in all material respects all of their respective
covenants and obligations hereunder theretofore to be
performed, and PTI shall have received at the Closing
certificates to that effect, dated the Closing Date, and
executed on behalf of Holdings by an executive officer of
Holdings and on behalf of Merger Sub by an executive officer of
Merger Sub.

4.2.2 PacifiCorp Agreement. PacifiCorp shall
have entered into the PacifiCorp Agreement, the representations
and warranties of PacifiCorp contained in the PacifiCorp
Agreement shall be correct in all material respects (a) at the
date of the PacifiCorp Agreement and (b) on and as of the
Closing Date with the same effect as though made on and as of
such date, and PacifiCorp shall have performed in all material
respects all of its covenants and obligations under the
PacifiCorp Agreement theretofore to be performed and PTI shall
have received at the Closing a certificate to that effect,
dated the Closing Date, and executed on behalf of PacifiCorp by
an executive officer of PacifiCorp.

4.2.3 No Injunction. No governmental action or
proceeding shall have been commenced that (a) in the opinion of
the Special Committee's counsel is more likely than not to be
successful and (b) seeks an injunction, a restraining order or
any other order seeking to prohibit, restrain, invalidate or
set aside the consummation of the Merger.

4.2.4 Fairness Opinions. Neither of the
Fairness Opinions shall have been modified withdrawn or revoked
as of the time of the mailing of the Proxy Statement to the
shareholders of PTI.

4.2.5 Consents and Approvals. All consents,
approvals, permits and authorizations required to be obtained
from governmental and regulatory authorities in connection with
the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby by PTI
shall have been obtained, except where the failure to obtain
such consents, approvals, permits and authorizations would not
have a <PAGE>
<PAGE>26

material adverse effect on the business, operations, financial
condition or prospects of PTI and its subsidiaries, taken as a
whole.

4.3 Conditions to Obligations of Holdings and Merger
Sub. The obligations of Holdings and Merger Sub to consummate
the transactions contemplated by this Agreement are subject to
the satisfaction or waiver at or before the Closing of the
following additional conditions:

4.3.1 Representations, Warranties, and
Covenants. The representations and warranties of PTI contained
in this Agreement shall be correct in all material respects (a)
at the date of this Agreement, and (b) as of the Closing with
the same effect as though made on and as of such date, except
for changes specifically contemplated by this Agreement, and
PTI shall have performed in all material respects all of its
respective covenants and obligations hereunder theretofore to
be performed, and Holdings and Merger Sub shall have received
at the Closing certificates to that effect, dated the Closing
Date, and executed on behalf of PTI by an executive officer of
PTI.

4.3.2 No Injunction. No governmental action or
proceeding shall have been commenced that (a) in the opinion of
Holding's counsel is more likely than not to be successful, and
(b) seeks an injunction, a restraining order or any other order
seeking to prohibit, restrain, invalidate or set aside
consummation of the Merger.

4.3.3 Material Adverse Change. Except as
disclosed in the Company SEC Reports or as otherwise disclosed
to a responsible officer of Holdings or PacifiCorp on or before
the date hereof, since September 30, 1994, there shall not have
been any change or event that has resulted in, or may result
in, any material adverse change in the business, operations,
properties, assets, liabilities or condition (financial or
otherwise) of PTI and its subsidiaries, taken as a whole.

4.3.4 Consents and Approvals. All consents,
approvals, permits and authorizations required to be obtained
from governmental and regulatory authorities in connection with
the execution and delivery of this Agreement and the
consummation of <PAGE>
<PAGE>27

the transactions contemplated hereby by Holdings shall have
been obtained, except where the failure to obtain such
consents, approvals, permits and authorizations would not have
a material adverse effect on the business, operations,
financial condition or prospects of Holdings and its
subsidiaries, taken as a whole.

ARTICLE V
TERMINATION

5.1 Termination. This Agreement may be terminated
and the Merger may be abandoned at any time prior to the
Effective Time, whether before or after the Shareholder
Meeting:

5.1.1 Mutual Consent. By the mutual consent of
the Boards of Directors of Holdings and PTI;

5.1.2 Failure of Merger to Occur by Certain
Date. By either PTI or Holdings if the Effective Time shall
not have occurred on or before September 30, 1995, which date
may be extended by the mutual consent of the Boards of
Directors of Holdings and PTI; provided, however, that the
right to terminate this Agreement under this Section 5.1.2
shall not be available to a party whose failure (or whose
subsidiary's or parent corporation's failure) to fulfill any
obligation under this Agreement has been a significant cause
of, or in any significant respect resulted in, the failure of
the Effective Time to occur on or before September 30, 1995 or,
in the event of an extension by the mutual agreement of
Holdings and PTI, by such later date;

5.1.3 Actions Restraining the Merger. By
either Holdings or PTI if any court of competent jurisdiction
in the United States or other United States governmental body
shall have issued an order, decree or ruling or taken any other
action restraining, enjoining or otherwise prohibiting the
Merger and such order, decree, ruling or other action shall
have become final and nonappealable;

<PAGE>
<PAGE>28

5.1.4 Failure of Shareholders to Approve. By
either Holdings or PTI if the shareholders of PTI fail to duly
adopt and approve this Agreement and the Merger as contemplated
by Section 4.1.1;

5.1.5 By PTI. By PTI if (A) there is a
material breach of any of the representations and warranties of
PacifiCorp, Holdings or Merger Sub or (B) PacifiCorp, Holdings
or Merger Sub fail to comply in any material respect with any
of their respective covenants or agreements, in each case as
contained herein or in the PacifiCorp Agreement; or

5.1.6 By Holdings. By Holdings or Merger Sub
if (A) the Special Committee or the Board of Directors upon the
recommendation of the Special Committee shall have withdrawn or
modified in any manner adverse to Holdings or Merger Sub its
approval or recommendation of this Agreement or the Merger, or
(B) there is a material breach of any of the representations
and warranties of PTI or (C) PTI fails to comply in any
material respect with any of its covenants or agreements
contained herein.

5.2 Effect of Termination. Except as set forth
below in this Section 5.2 and as provided in Section 6.1, upon
the termination of this Agreement pursuant to Section 5.1, this
Agreement shall forthwith become null and void and no party to
this Agreement shall have any liability or further obligation
to the other party by reason of this Agreement, other than for
damages to the extent arising from a prior breach of this
Agreement.

<PAGE>
<PAGE>29

ARTICLE VI
MISCELLANEOUS AND GENERAL

6.1 Survival of Representations, Warranties and
Agreements. The representations and warranties in this
Agreement shall terminate at the Effective Time or upon the
termination of this Agreement pursuant to Section 5.1, as the
case may be. The covenants and agreements contained in this
Agreement shall survive the Effective Time and shall continue
until they terminate in accordance with their terms. The
covenants and agreements contained in Sections 3.11, 5.2 and
this Section 6.1 shall survive termination of this Agreement in
accordance with their terms.

6.2 Waiver and Amendment. Any provision of this
Agreement may be waived at any time by the party that is, or
whose shareholders are, entitled to the benefits thereof.
Except for the provisions hereof relating to indemnification
and insurance as set forth in Section 3.8, this Agreement may
be amended or supplemented at any time, except that after
approval hereof by the shareholders of PTI, no amendment shall
be made which decreases the Merger Consideration, changes the
form of the Merger Consideration or that in any other way
materially adversely affects the rights of the Minority
Shareholders (other than a termination of this Agreement)
without the further approval of the Minority Shareholders. No
such waiver, amendment or supplement shall be effective unless
in writing and signed by the party or parties intended to be
bound thereby.

6.3 Entire Agreement. This Agreement (a) contains
the entire agreement among Holdings, Merger Sub and PTI with
respect to the Merger and the other transactions contemplated
hereby, and supersedes all prior agreements among the parties
with respect to such matters, and (b) is not intended to confer
upon any other persons any rights or remedies hereunder, except
as specifically provided for herein.

<PAGE>
<PAGE>30

6.4 Headings. The descriptive headings contained
herein are for convenience and reference only and shall not
affect in any way the meaning or interpretation of this
Agreement.

6.5 Notices. All notices or other communications
hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in
person, by cable, telegram, telex or other standard form of
telecommunications, or by registered or certified mail, postage
prepaid, return receipt requested addressed as follows:

If to PTI: With copies to:

Pacific Telecom, Inc. Latham & Watkins
Attention: Special Committee Attention: John J. Huber
of the Board of Directors 1001 Pennsylvania Ave., NW
c/o James H. Huesgen Suite 1300
805 Broadway Washington, D.C. 20004-2505
Vancouver, WA 98660

If to Holdings or Merger Sub: With a copy to:

PacifiCorp Holdings, Inc. Stoel Rives Boley Jones & Grey
Attention: Richard T. O'Brien Attention: Henry H. Hewitt
700 NE Multnomah 900 SW Fifth Avenue
Suite 1600 Suite 2300
Portland, Oregon 97232 Portland, Oregon 97204

or to such other address as any party may have furnished to the other
parties in writing in accordance herewith.

6.6 Parties in Interest; Assignment. This Agreement is
binding upon and is solely for the benefit of the parties and their
respective successors, legal representatives and assigns except that
Sections 3.8 and 3.13 shall be for the express benefit of the persons
in the categories referred to therein. Holdings shall have the right
to assign to one or more direct or indirect wholly owned subsidiaries
of Holdings any and all rights and obligations of Merger Sub under
this Agreement, including without limitation, the right to substitute
in Merger Sub's place such a subsidiary as one of the <PAGE>
<PAGE>31

constituent corporations in the Merger (if such subsidiary assumes all
of the obligations of Merger Sub in connection with the Merger). If
Holdings exercises its right to so restructure the transaction, PTI
shall promptly enter into appropriate agreements to reflect such
restructuring. In any such event the amounts to be paid to holders of
Minority Stock shall not be reduced, nor shall there be any material
delay of the Effective Time.

6.7 Specific Performance. The parties agree that
irreparable damage would occur if any of the provisions of this
Agreement are not performed in accordance with their specific terms or
are otherwise breached. It is agreed that the parties shall be
entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions hereof
in any court of the United States or any state having jurisdiction, in
addition to any other remedy to which any party is entitled at law or
in equity.

6.8 Public Statements. The parties agree to consult with
each other prior to issuing any public announcement or statement with
respect to the Merger, if practicable. As soon as is practicable
following execution of this Agreement, the parties will issue a joint
press release announcing the execution of this Agreement, which press
release will be in the form of Exhibit C hereto.

6.9 Counterparts. For the convenience of the parties
hereto, this Agreement may be executed in any number of counterparts,
each such counterpart being deemed to be an original instrument, and
all such counterparts shall together constitute the same agreement.

6.10 Choice of Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Washington
regardless of the laws that might otherwise govern under applicable
principles of conflicts of law.

(Signature pages to follow)

IN WITNESS WHEREOF, this Agreement has been duly executed
and delivered by the duly authorized officers of the parties hereto as
of the date first hereinabove written.

PACIFIC TELECOM, INC.

By CHARLES E. ROBINSON
-----------------------------
Title: Chief Executive Officer

PACIFICORP HOLDINGS, INC.

By RICHARD T. O'BRIEN
-----------------------------
Title: Senior Vice President

PXYZ CORPORATION

By RICHARD T. O'BRIEN
-----------------------------
Title: President

EXHIBITS TO THE

AGREEMENT AND PLAN OF MERGER

Exhibit Description (Section Reference)

A. Form of PacifiCorp Agreement (Recital F and Section 4.2.2)

B. Form of Amendment to Schedule 13D to be filed by
PacifiCorp (Section 2.2.5)

C. Form of Joint Press Release (Section 6.8)

<PAGE>1
AGREEMENT

This Agreement is dated as of March 9, 1995 between
PacifiCorp, an Oregon corporation ("PacifiCorp"), and Pacific
Telecom, Inc., a Washington corporation ("PTI").

RECITALS
--------

A. PacifiCorp owns all of the issued and outstanding
capital stock of PacifiCorp Holdings, Inc., a Delaware
corporation ("Holdings"). On the date hereof, PTI, PXYZ
Corporation, a Washington corporation ("Merger Sub"), and
Holdings are entering into an Agreement and Plan of Merger (the
"Agreement and Plan of Merger") dated the date hereof and
providing, among other things, for the merger of Merger Sub
with and into PTI (the "Merger"). PTI has indicated that it
will not enter into the Agreement and Plan of Merger unless PTI
and PacifiCorp enter into this Agreement at the same time.
PacifiCorp is entering into this Agreement with PTI expressly
for the purpose of inducing PTI to enter into the Agreement and
Plan of Merger. Immediately following the Merger, Holdings
will own all of the issued and outstanding capital stock of
PTI.

B. PacifiCorp believes that it is in the best interests
of PacifiCorp and its shareholders to consummate the Merger.

AGREEMENT
---------

In consideration of the execution by Company of the
Agreement and Plan of Merger and of the mutual covenants and
agreements set forth herein, PacifiCorp and PTI agree as
follows:

1. Defined Terms. Capitalized terms used herein
-------------
shall have the meanings assigned to them in the Agreement and
Plan of Merger unless otherwise defined herein.

2. Certain Representations.
-----------------------

(a) Organization and Good Standing. PacifiCorp
------------------------------
is a corporation duly organized and validly existing under the
laws of the State of Oregon. PacifiCorp has all requisite
corporate power and authority to own and operate its properties
and to carry on its business as now being conducted.

(b) Corporate Authority. PacifiCorp has full
-------------------
corporate power and authority to execute and deliver this
Agreement and to undertake the obligations provided for herein.
<PAGE>
<PAGE>2
The execution, delivery and performance of this Agreement by
PacifiCorp have been duly authorized by all requisite corporate
action and no further corporate proceedings on the part of
PacifiCorp are necessary to authorize this Agreement or to
undertake the obligations provided for herein. This Agreement
has been duly and validly executed and delivered by PacifiCorp
and constitutes a valid and binding agreement of PacifiCorp,
enforceable in accordance with its terms, except as enforcement
may be affected by applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws affecting the
enforcement of creditors' rights generally and except that the
availability of the equitable remedies of specific performance
and equitable relief are subject to the discretion of the court
before which any such proceeding may be brought.

(c) Proxy Statement and Schedule 13E-3. None
----------------------------------
of the information supplied or to be supplied by PacifiCorp for
inclusion in the Schedule 13E-3 or the Proxy Statement and any
amendments thereof or supplements thereto will, on the
respective dates such materials are filed with the SEC, at the
time of the mailing of such Proxy Statement or any amendment or
supplement thereto to shareholders of PTI, at the time of the
Shareholder Meeting and at the Effective Time, contain any
untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in
order to make the statements made therein, in light of the
circumstances under which they were made, not misleading. If
at any time prior to the Effective Time any event with respect
to PacifiCorp or any of its officers, directors or affiliates
should occur which is required to be described in an amendment
of, or a supplement to, the Proxy Statement or the Schedule
13E-3, such event shall be so described, and such amendment or
supplement shall be promptly filed with the SEC and, as
required by law, disseminated to the shareholders of PTI. The
Schedule 13E-3 will comply (with respect to PacifiCorp and its
officers, directors and affiliates) in all material respects,
as to form, with the applicable requirements of each of the
Exchange Act and the respective rules and regulations
thereunder.

(d) Required Approvals and Consents. Except
-------------------------------
for compliance with the applicable requirements of the Exchange
Act and the securities laws of the various states, no filing
with, and no permit, authorization, consent or approval of, any
public body is necessary for the execution and delivery by
PacifiCorp of this Agreement or the consummation by PacifiCorp
of the transactions contemplated by this Agreement.

(e) Prior Offers; No Present Intent to Sell.
---------------------------------------
Since January 1, 1993, to the best knowledge of PacifiCorp,
after due inquiry, PacifiCorp has not received any "proposal"<PAGE>
<PAGE>3
or offer to purchase, or solicited any proposal or offer to
purchase, any material portion of the stock or assets of PTI,
other than transactions disclosed in Company SEC Reports
(including, without limitation, the sale of Alascom). For
purposes of this Section 2(e) a "proposal" may be either
written or oral, but must have included a proposed or suggested
price or possible range of prices and, if made on behalf of a
corporation, must have been made by a responsible officer or
representative of that corporation. PacifiCorp has no current
plan or intent to sell or otherwise dispose of any material
portion of the stock or assets of PTI, other than transactions
disclosed in Company SEC Reports (including, without
limitation, the sale of Alascom). The Schedule 13D of
PacifiCorp filed in respect of Holdings' ownership interest in
PTI, as amended by the 13D Amendment, fully complies with all
of the requirements of such Schedule, including, without
limitation, Item 4 thereof. The 13D Amendment will be filed
promptly after execution of this Agreement.

3. Proxy Materials and Schedule 13E-3. PacifiCorp
----------------------------------
will cooperate fully with Holdings, Merger Sub and PTI in
preparing and filing the Schedule 13E-3 and in obtaining SEC
clearance of the Schedule 13E-3 as contemplated by Section 3.1
of the Agreement and Plan of Merger. PacifiCorp will cause its
officers and directors to cooperate fully with PTI in
responding promptly to any comments of the SEC in regard of any
of the filings made by such persons with the SEC in connection
with the transactions contemplated by this Agreement or the
Agreement and Plan of Merger.

4. Fairness of the Merger. PacifiCorp has
----------------------
determined that the transactions contemplated by this Agreement
and the Agreement and Plan of Merger are fair to the Minority
Shareholders.

5. Certain Filings, Consents and Arrangements.
------------------------------------------

5.1 Consents. PacifiCorp shall use its best
--------
efforts to obtain any necessary consents, permits,
authorizations, approvals and waivers required to be obtained
by it to permit the consummation of the transactions
contemplated by the Agreement and Plan of Merger.

5.2 Filings. PacifiCorp shall promptly
-------
determine whether any filings are required to be made by it or
consents, approvals, permits or authorizations are required to
be obtained by it under any federal, state or foreign law or
regulation or any consents, approvals or waivers are required
to be obtained from other parties to loan agreements or other
agreements or instruments material to PacifiCorp's business in
connection with the consummation of the Merger and will
promptly make any such filings, furnish information required in<PAGE>
<PAGE>4
connection therewith and seek timely to obtain any such
consents, permits, authorizations, approvals or waivers.

6. Dividend Policy. During the period from the
---------------
date of this Agreement to the Effective Time, PacifiCorp shall
not take any action to cause PTI to make any dividend or other
distribution or payment to Holdings with respect to Holdings
Stock otherwise than in accordance with PTI's existing dividend
policies.

7. Indemnification. From and after the Effective
---------------
Time, PacifiCorp shall (to the extent specified in the
following sentence) indemnify, defend and hold harmless each
person who is now a director or officer of PTI against all
losses, claims, damages, costs, expenses or liabilities, or in
connection with any claim, action, suit, proceeding or
investigation (a "Claim"), arising out of the fact that such
person is a director or officer of PTI (or out of any action
taken by any such person on behalf of PTI), pertaining to any
matter existing or occurring on or prior to the Effective Time
(or, with respect to matters arising from or in connection with
Section 1.5 of the Agreement and Plan of Merger, subsequent to
the Effective Time) (including, without limitation, the
transactions contemplated by the Agreement and Plan of Merger),
whether asserted or claimed prior to, or on or after, the
Effective Time. In each case such indemnification shall be to
the full extent a corporation is permitted under Washington law
to indemnify its own directors and officers (and PacifiCorp
will pay expenses in advance of the final disposition of any
such action or proceeding to each such director of PTI seeking
indemnification hereunder to the full extent permitted by law).

8. Notification of Certain Matters. Each of
-------------------------------
PacifiCorp and PTI shall give prompt notice to the other of (i)
any claims, actions, proceedings or investigations commenced
or, to the best of its knowledge, threatened, involving or
affecting the notifying party or any of its property or assets,
that relate to the Merger, (ii) the occurrence, or failure to
occur, of any event that would be likely to cause any
representation or warranty of the notifying party contained in
this Agreement or the Agreement and Plan of Merger to be untrue
or inaccurate in any material respect, and (iii) any material
failure of the notifying party or of any officer, director,
employee or agent thereof, to comply with or satisfy any
covenant, condition or agreement to be complied with or
satisfied by it hereunder or under the Agreement and Plan of
Merger. No such notification shall affect the representations
or warranties of the parties or the conditions to the
obligations of the parties hereunder or under the Agreement and
Plan of Merger. Any notice properly given by PTI to Holdings<PAGE>
<PAGE>5
in compliance with the Agreement and Plan of Merger shall also
constitute notice of such matter to PacifiCorp hereunder.

9. Fees and Expenses. All costs and expenses
-----------------
incurred in connection with this Agreement and the transactions
contemplated hereby shall be paid by the party incurring such
expenses, whether or not the Merger is consummated.

10. Public Announcements. PacifiCorp agrees to
--------------------
consult with PTI prior to issuing any public announcement or
statement with respect to the Merger, if practicable.

11. Assignment. This Agreement shall be binding
----------
upon and is solely for the benefit of the parties and their
respective successors, legal representatives and assigns, and
is not intended to confer any benefit on any third party except
that Section 7 shall be for the express benefit of the persons
in the categories referred to therein. The rights under this
Agreement shall not be assigned by either party without the
prior written consent of the other.

12. Governing Law. This Agreement shall be governed
-------------
by the laws of the State of Washington applicable to contracts
made and to be performed therein.

13. Entire Agreement. This Agreement (a) contains
----------------
the entire agreement between PacifiCorp and PTI with respect to
the transactions contemplated by the Agreement and Plan of
Merger, and (b) supersedes all prior agreements between the
parties with respect to such matters.

14. Notices. All notices or other communications
-------
hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in
person, by cable, telegram, telex or other standard form of
telecommunications, or by registered or certified mail, postage
prepaid, return receipt requested addressed as follows:

If to PTI: With copies to:

Pacific Telecom, Inc. Latham & Watkins
Attention: Special Committee of Attention: John J. Huber
the Board of Directors 1001 Pennsylvania Ave., NW
c/o James H. Huesgen Suite 1300
805 Broadway Washington, D.C. 20004-2505
Vancouver, WA 98660

<PAGE>
If to PacifiCorp: With a copy to:

PacifiCorp Stoel Rives Boley Jones & Grey
Attention: Richard T. O'Brien Attention: Henry H. Hewitt
700 NE Multnomah 900 SW Fifth Avenue
Suite 1600 Suite 2300
Portland, Oregon 97232 Portland, Oregon 97204

or to such other address as any party may have furnished to the
other parties in writing in accordance herewith.

15. Specific Performance. The parties agree that
--------------------
irreparable damage would occur if any of the provisions of this
Agreement are not performed in accordance with their specific terms
or are otherwise breached. It is agreed that the parties shall be
entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions
hereof in any court of the United States or any state having
jurisdiction, in addition to any other remedy to which any party is
entitled at law or in equity.

16. Counterparts. This Agreement may be executed in
------------
counterparts, each of which when so executed shall be deemed to be
an original, and such counterparts shall together constitute but one
and the same instrument.

(Signature pages to follow)<PAGE>
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first above written.

PACIFICORP

By: FREDERICK W. BUCKMAN
--------------------------------------
Title: Chief Executive Officer

PACIFIC TELECOM, INC.

By: CHARLES E. ROBINSON
--------------------------------------
Title: Chief Executive Officer