Document:

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                                                               EXHIBIT 10(cc)(1)

                              SEPARATION AGREEMENT

                                     BETWEEN

                            CENTERPOINT ENERGY, INC.

                                       AND

                           TEXAS GENCO HOLDINGS, INC.

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                                TABLE OF CONTENTS

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ARTICLE I DEFINITIONS.......................................................................................    2

         1.1        Action..................................................................................    2
         1.2        Affiliates..............................................................................    2
         1.3        Ancillary Agreements....................................................................    2
         1.4        Business................................................................................    2
         1.5        Business Day............................................................................    2
         1.6        Business Separation Plan................................................................    2
         1.7        CenterPoint's Auditors..................................................................    2
         1.8        CenterPoint Business....................................................................    2
         1.9        CenterPoint Field of Use................................................................    3
         1.10       CenterPoint Group.......................................................................    3
         1.11       CenterPoint Indemnitees.................................................................    3
         1.12       CenterPoint Intellectual Property.......................................................    3
         1.13       Code....................................................................................    3
         1.14       Commission..............................................................................    3
         1.15       Distribution Shares.....................................................................    3
         1.16       Exchange Act............................................................................    3
         1.17       Final Order.............................................................................    3
         1.18       Genco Assets............................................................................    3
         1.19       Genco Auditors..........................................................................    3
         1.20       Genco Balance Sheet.....................................................................    3
         1.21       Genco Business..........................................................................    4
         1.22       Genco Common Stock......................................................................    4
         1.23       Genco Debt Obligations..................................................................    4
         1.24       Genco Distribution Agent................................................................    4
         1.25       Genco Distribution Date.................................................................    4
         1.26       Genco Excluded Liabilities..............................................................    4
         1.27       Genco Group.............................................................................    4
         1.28       Genco Indemnitees.......................................................................    4
         1.29       Genco Intellectual Property.............................................................    4
         1.30       Genco Liabilities.......................................................................    4
         1.31       Genco LP................................................................................    5
         1.32       Genco Option............................................................................    5
         1.33       Genco Option Agreement..................................................................    5
         1.34       Genco Option Agreement Undertaking......................................................    5
         1.35       Genco Separation Date...................................................................    5
         1.36       Genco Tax Allocation Agreement..........................................................    5
         1.37       Genco Transition Services Agreement.....................................................    5
         1.38       Governmental Approvals..................................................................    6
         1.39       Governmental Authority..................................................................    6
         1.40       Holding Company Restructuring...........................................................    6
         1.41       Indebtedness............................................................................    6
         1.42       Indemnifying Party......................................................................    6
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         1.43       Indemnitee..............................................................................    6
         1.44       Indemnity Payment.......................................................................    6
         1.45       Information.............................................................................    6
         1.46       Insurance Proceeds......................................................................    6
         1.47       Intellectual Property...................................................................    7
         1.48       Liabilities.............................................................................    7
         1.49       Losses..................................................................................    7
         1.50       Master Separation Agreement.............................................................    7
         1.51       NYSE....................................................................................    7
         1.52       Person..................................................................................    7
         1.53       PUCT....................................................................................    7
         1.54       Record Date.............................................................................    7
         1.55       Regulatory Proceedings..................................................................    8
         1.56       REI.....................................................................................    8
         1.57       Resources...............................................................................    8
         1.58       Subsidiary..............................................................................    8
         1.59       Taxes...................................................................................    8
         1.60       Technical Services Agreement............................................................    8
         1.61       Technical Services Assignment and Assumption Agreement..................................    8
         1.62       Third Party Claim.......................................................................    8
         1.63       Utilities Code..........................................................................    8

ARTICLE II THE GENCO DISTRIBUTION AND THE ACTIONS PENDING...................................................    9

         2.1        Delivery of Shares for Genco Distribution...............................................    9
         2.2        Actions Prior to the Genco Distribution.................................................    9
         2.3        Conditions Precedent to the Genco Distribution..........................................    9
         2.4        Cooperation............................................................................    10
         2.5        Fractional Shares......................................................................    10

ARTICLE III MUTUAL RELEASES; INDEMNIFICATION...............................................................    11

         3.1        Release of Pre-Distribution Claims.....................................................    11
         3.2        Indemnification by Genco...............................................................    13
         3.3        Indemnification by CenterPoint.........................................................    13
         3.4        Indemnification Obligations Net of Insurance Proceeds and Other Amounts................    14
         3.5        Procedures for Indemnification of Third Party Claims...................................    15
         3.6        Additional Matters.....................................................................    16
         3.7        Remedies Cumulative....................................................................    16
         3.8        Survival of Indemnities................................................................    16
         3.9        Indemnification of Directors and Officers..............................................    17

ARTICLE IV CORPORATE GOVERNANCE AND CERTAIN OTHER MATTERS..................................................    17

         4.1        Charter, Bylaws and Board of Directors of Genco........................................    17
         4.2        Issuance of Stock......................................................................    17

ARTICLE V INTELLECTUAL PROPERTY............................................................................    17
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         5.1        Assignment.............................................................................    17
         5.2        License Grants.........................................................................    17
         5.3        Cooperation and Further Undertakings...................................................    18
         5.4        CenterPoint Disclaimer of Warranties...................................................    18
         5.5        Genco Disclaimer of Warranties.........................................................    18

ARTICLE VI ENVIRONMENTAL MATTERS...........................................................................    18

         6.1        Definitions............................................................................    18
         6.2        Environmental Liabilities..............................................................    20
         6.3        Genco Excluded Liabilities.............................................................    20
         6.4        Genco Liabilities......................................................................    20
         6.5        Post-Separation Date Environmental Arrangements........................................    20

ARTICLE VII ARBITRATION; DISPUTE RESOLUTION................................................................    21

         7.1        Agreement to Arbitrate.................................................................    21
         7.2        Escalation.............................................................................    21
         7.3        Demand for Arbitration.................................................................    22
         7.4        Arbitrators............................................................................    22
         7.5        Hearings...............................................................................    23
         7.6        Discovery and Certain Other Matters....................................................    24
         7.7        Certain Additional Matters.............................................................    24
         7.8        Continuity of Service and Performance..................................................    25
         7.9        Law Governing Arbitration Procedures...................................................    25

ARTICLE VIII COVENANTS AND OTHER MATTERS...................................................................    25

         8.1        Other Agreements.......................................................................    25
         8.2        Agreement for Exchange of Information..................................................    26
         8.3        Auditors and Audits; Annual and Quarterly Statements and Accounting....................    27
         8.4        Audit Rights...........................................................................    29
         8.5        Preservation of Legal Privileges.......................................................    29
         8.6        Payment of Expenses....................................................................    30
         8.7        Governmental Approvals.................................................................    30
         8.8        Regulatory Proceedings.................................................................    30
         8.9        Continuance of CenterPoint Credit Support; Borrowings..................................    31
         8.10       [Reserved Section].....................................................................    32
         8.11       Confidentiality........................................................................    32
         8.12       Capacity Auctions......................................................................    33
         8.13       Nuclear Decommissioning Trust and Investment...........................................    33

ARTICLE IX MISCELLANEOUS...................................................................................    33

         9.1        Limitation of Liability................................................................    33
         9.2        Entire Agreement.......................................................................    34
         9.3        Governing Law..........................................................................    34
         9.4        Termination............................................................................    34
         9.5        Notices................................................................................    34
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         9.6        Counterparts...........................................................................    34
         9.7        Binding Effect; Assignment.............................................................    34
         9.8        Severability...........................................................................    34
         9.9        Failure or Indulgence Not Waiver; Remedies Cumulative..................................    35
         9.10       Amendment..............................................................................    35
         9.11       Authority..............................................................................    35
         9.12       Interpretation.........................................................................    35
         9.13       Conflicting Agreements.................................................................    35
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                              SEPARATION AGREEMENT

                  THIS SEPARATION AGREEMENT (this "Agreement") is entered into
effective as of August 31, 2002 between CenterPoint Energy, Inc., a Texas
corporation ("CenterPoint"), and Texas Genco Holdings, Inc., a Texas corporation
("Genco"). Capitalized terms used herein and not otherwise defined shall have
the meanings assigned to them in Article I hereof.

                                    RECITALS

                  WHEREAS, Genco was incorporated on August 24, 2001 and
organized as a wholly owned direct Subsidiary of Reliant Energy, Incorporated, a
Texas corporation ("REI"), on September 21, 2001; and

                  WHEREAS, effective August 31, 2002, REI consummated a
restructuring transaction (the "Holding Company Restructuring") as a result of
which it became an indirect wholly owned subsidiary of CenterPoint; and

                  WHEREAS, as part of the Holding Company Restructuring, REI
conveyed the Genco Assets to Genco and Genco contributed the Genco Assets to
Texas Genco, LP, a Texas limited partnership and a wholly owned subsidiary of
Genco ("Genco LP"); and

                  WHEREAS, as part of the Holding Company Restructuring REI was
converted into a Texas limited liability company named CenterPoint Energy
Houston Electric, LLC ("CenterPoint Houston"); and

                  WHEREAS, under the Texas Electric Choice Plan (the "Texas
Electric Restructuring Law"), CenterPoint Houston is entitled to recover its
"stranded costs" associated with the Genco Assets; and

                  WHEREAS, the Texas Electric Restructuring Law allows alternate
methods for establishing a market value for the Genco Assets, and under the
Business Separation Plan, REI agreed that the fair market value of the Genco
Assets will be determined using the partial stock market valuation method
permitted under the law; and

                  WHEREAS, CenterPoint intends to distribute (the "Genco
Distribution") approximately 19% of the outstanding shares of Genco Common Stock
to CenterPoint's common shareholders on a pro rata basis in order to effect the
partial stock valuation method for the Genco Assets as contemplated under the
Business Separation Plan; and

                  WHEREAS, in 2004 following the Genco Distribution, Reliant
Resources, Inc., a Delaware corporation ("Resources"), will have the option
purchase all of the shares of Genco Common Stock then owned by CenterPoint
pursuant to the Genco Option Agreement; and

                  WHEREAS, the parties intend in this Agreement, including the
Exhibits and Schedules hereto, to set forth the principal arrangements between
them regarding the separation of the Genco Business from the CenterPoint
Business and the Genco Distribution.

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                  NOW, THEREFORE, in consideration of the foregoing and the
covenants and agreements set forth below, the parties hereto agree as follows:

                                   ARTICLE I

                                   DEFINITIONS

         1.1      Action. "Action" means any demand, action, suit, countersuit,
arbitration, inquiry, proceeding or investigation by or before any federal,
state, local, foreign or international Governmental Authority or any arbitration
or mediation tribunal.

         1.2      Affiliates. An "Affiliate" of any Person means another Person
that directly, or indirectly through one or more intermediaries, controls, is
controlled by, or is under common control with, such Person. For this purpose
"control" means the possession, directly or indirectly, of the power to direct
or cause the direction of the management and policies of the Person controlled,
whether through ownership of voting securities, by contract or otherwise. The
fact that any Person may be deemed at any time an Affiliate of another Person
for purposes of the Utilities Code shall not create any implication that such
Persons are "affiliates" for purposes of this Agreement. Notwithstanding
anything herein to the contrary, no member of the Genco Group shall be deemed an
Affiliate of any member of the CenterPoint Group and no member of the
CenterPoint Group shall be deemed an Affiliate of any member of the Genco Group.

         1.3      Ancillary Agreements. "Ancillary Agreements" means (i) the
Genco Transition Services Agreement and the Genco Tax Allocation Agreement
between the parties hereto of even date herewith, (ii) the conveyances and other
related documents delivered in connection with the transfer of the Genco Assets
to Genco LP in connection with the Holding Company Restructuring, (iii) the
Technical Services Assignment and Assumption Agreement, (iv) the Genco Option
Agreement Undertaking, and (v) such other agreements, documents or instruments
as the parties may agree are necessary or desirable and which specifically state
that they are Ancillary Agreements within the meaning of this Agreement.

         1.4      Business. "Business" means either of the CenterPoint Business
or the Genco Business, as the context requires.

         1.5      Business Day. "Business Day" means a day other than a
Saturday, a Sunday or a day on which banking institutions located in the State
of Texas are authorized or obligated by law or executive order to close.

         1.6      Business Separation Plan. "Business Separation Plan" means the
Business Separation Plan, as amended, filed by REI with the PUCT in accordance
with Section 39.051 of the Utilities Code and approved by the PUCT at its open
meeting on December 1, 2000 (Docket No. 21956).

         1.7      CenterPoint's Auditors. "CenterPoint's Auditors" means
CenterPoint's independent certified public accountants.

         1.8      CenterPoint Business. "CenterPoint Business" means any
business of CenterPoint and its Subsidiaries other than the Genco Business.

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         1.9      CenterPoint Field of Use. "CenterPoint Field of Use" means
electric power transmission and distribution; natural gas distribution; thermal
utilities and systems; and interstate pipeline and gathering activities.

         1.10     CenterPoint Group. "CenterPoint Group" means CenterPoint, each
Subsidiary of CenterPoint (other than any member of the Genco Group) immediately
after the Genco Separation Date and each Person that becomes a Subsidiary of
CenterPoint after the Genco Separation Date.

         1.11     CenterPoint Indemnitees. "CenterPoint Indemnitees" has the
meaning assigned to that term in Section 3.2.

         1.12     CenterPoint Intellectual Property. "CenterPoint Intellectual
Property" means that Intellectual Property owned, in whole or in part,
immediately prior to the Genco Separation Date, by any entity that, subsequent
to the Separation Date, will be a part of the CenterPoint Group.

         1.13     Code. "Code" means the Internal Revenue Code of 1986, as
amended from time to time.

         1.14     Commission. "Commission" means the Securities and Exchange
Commission.

         1.15     Distribution Shares. "Distribution Shares" has the meaning set
forth in Section 2.1.

         1.16     Exchange Act. "Exchange Act" means the Securities Exchange Act
of 1934, as amended.

         1.17     Final Order. Unless the context requires otherwise, "Final
Order," "Order," "Injunction," "Decree," "Legal Restraint," "Prohibition,"
"Writ" or other words of similar import shall mean final adjudication by a court
or regulatory agency that is no longer subject to rehearing or appeal.

         1.18     Genco Assets. "Genco Assets" means all of the generation
assets (as that term is defined in Section 39.251(3) of the Utilities Code) that
belonged to the Reliant Energy HL&P Division of REI before such assets were
conveyed, assigned, transferred and delivered to Genco LP pursuant to a Bill of
Sale and Assignment dated as of August 31, 2002 (the "Genco Bill of Sale"). The
Genco Assets include, without limitation, the generation plants and other assets
and contract and permit rights associated with those generation plants as
described in the Genco Bill of Sale. The methodology for determining the
demarcation between Genco Assets and CenterPoint's transmission and distribution
assets is set forth in Section D of the Business Separation Plan.

         1.19     Genco Auditors. "Genco Auditors" means Genco's independent
certified public accountants.

         1.20     Genco Balance Sheet. "Genco Balance Sheet" means the
consolidated balance sheet of Genco and affiliates as of August 31, 2002.

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         1.21     Genco Business. "Genco Business" means the electric generation
business and operations conducted with the Genco Assets.

         1.22     Genco Common Stock. "Genco Common Stock" means the Common
Stock, par value $.001 per share, of Genco.

         1.23     Genco Debt Obligations. "Genco Debt Obligations" means all
Indebtedness of Genco or any other member of the Genco Group, excluding all
Indebtedness of any member of the CenterPoint Group to the extent it constitutes
Indebtedness of Genco by virtue of clause (f) or clause (g) of the definition of
Indebtedness. Genco Debt Obligations shall include, as of the date of the Genco
Balance Sheet, the Indebtedness of Genco reflected on such balance sheet.

         1.24     Genco Distribution Agent. "Genco Distribution Agent" has the
meaning set forth in Section 2.1.

         1.25     Genco Distribution Date. "Genco Distribution Date" has the
meaning set forth in Section 2.1.

         1.26     Genco Excluded Liabilities. "Genco Excluded Liabilities" means
any and all Liabilities that are expressly contemplated by this Agreement or any
Ancillary Agreement as Liabilities to be retained or assumed by CenterPoint or
any other member of the CenterPoint Group, and all agreements and obligations of
any member of the CenterPoint Group under this Agreement or any of the Ancillary
Agreements.

         1.27     Genco Group. "Genco Group" means Genco, each Subsidiary of
Genco immediately after the Genco Separation Date, including the Subsidiaries
set forth in Schedule 1.27, and each Person that becomes a Subsidiary of Genco
after the Genco Separation Date.

         1.28     Genco Indemnitees. "Genco Indemnitees" has the meaning set
forth in Section 3.3.

         1.29     Genco Intellectual Property. "Genco Intellectual Property"
means that Intellectual Property owned, in whole or in part, immediately prior
to the Genco Separation Date, by any entity which, subsequent to the Genco
Separation Date, will be a part of the Genco Group.

         1.30     Genco Liabilities. "Genco Liabilities" means:

                           (i)      any and all Liabilities under contracts for
                  the purchase of fuel, equipment or other goods and services
                  for use in the Genco Business;

                           (ii)     any and all Liabilities that are expressly
                  contemplated by this Agreement or any Ancillary Agreement as
                  Liabilities to be assumed by Genco or any member of the Genco
                  Group, including Liabilities under the Technical Services
                  Agreement and the contracts, agreements and permits included
                  in the Genco Assets; and

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                           (iii)    all Liabilities (other than Taxes based on,
                  or measured by reference to, net income), primarily relating
                  to, arising out of, or resulting from:

                                    (A)      the operation of the Genco
                           Business, as conducted at any time prior to, on or
                           after, the Genco Separation Date (including any
                           Liability relating to, arising out of or resulting
                           from any act or failure to act by any director,
                           officer, employee, agent or representative (whether
                           or not such act or failure to act is or was within
                           such Person's authority));

                                    (B)      the operation of any business
                           conducted by the Genco Group at any time after the
                           Genco Separation Date (including any Liability
                           relating to, arising out of or resulting from any act
                           or failure to act by any director, officer, employee,
                           agent or representative (whether or not such act or
                           failure to act is or was within such Person's
                           authority));

                                    (C)      the ownership or use of the Genco
                           Assets; and

                                    (D)      the Genco Debt Obligations.

Notwithstanding the foregoing, the Genco Liabilities shall not include the Genco
Excluded Liabilities.

         1.31     Genco LP. "Genco LP" means Texas Genco, LP, a Texas limited
partnership and a wholly owned direct Subsidiary of Genco.

         1.32     Genco Option. "Genco Option" means the "Option" as defined in
the Genco Option Agreement.

         1.33     Genco Option Agreement. "Genco Option Agreement" means the
Texas Genco Option Agreement dated as of December 31, 2000 between REI and
Resources.

         1.34     Genco Option Agreement Undertaking. "Genco Option Agreement
Undertaking" means that certain Undertaking to Comply with Certain Provisions of
Option Agreement entered into as of August 31, 2002 by Genco under which Genco
has agreed to observe and comply with certain covenants of the Genco Option
Agreement.

         1.35     Genco Separation Date. "Genco Separation Date" means August
31, 2002, the date on which the Genco Assets were transferred to Genco LP and
the Genco Liabilities were assumed by Genco or Genco LP pursuant to that certain
Bill of Sale and Assignment of even date therewith.

         1.36     Genco Tax Allocation Agreement. "Genco Tax Allocation
Agreement" means the Tax Allocation Agreement of even date herewith between
CenterPoint and Genco.

         1.37     Genco Transition Services Agreement. "Genco Transition
Services Agreement" means the Transition Services Agreement of even date
herewith between CenterPoint and Genco.

                                       5

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         1.38     Governmental Approvals. "Governmental Approvals" means any
notices, reports or other filings to be made, or any consents, registrations,
approvals, permits or authorizations to be obtained from, any Governmental
Authority.

         1.39     Governmental Authority. "Governmental Authority" means any
federal, state, local, foreign or international court, government, department,
commission, board, bureau, agency, official or other regulatory, administrative
or governmental authority.

         1.40     Holding Company Restructuring. "Holding Company Restructuring"
has the meaning set forth in the recitals hereto.

         1.41     Indebtedness. "Indebtedness" of any Person means (a) all
obligations of such Person for borrowed money, (b) all obligations of such
Person evidenced by bonds, debentures, notes or similar instruments, (c) all
obligations of such Person upon which interest charges are customarily paid, (d)
all obligations of such Person under conditional sale or other title retention
agreements relating to property or assets purchased by such Person, (e) all
obligations of such Person issued or assumed as the deferred purchase price of
property or services, (f) all Indebtedness of others secured by (or for which
the holder of such Indebtedness has an existing right, contingent or otherwise,
to be secured by) any mortgage, lien, pledge, or other encumbrance on property
owned or acquired by such Person, whether or not the obligations secured thereby
have been assumed, (g) all guarantees by such Person of Indebtedness of others,
(h) all capital lease obligations of such Person, and (i) all securities or
other similar instruments convertible or exchangeable into any of the foregoing,
but excluding daily cash overdrafts associated with routine cash operations.

         1.42     Indemnifying Party. "Indemnifying Party" has the meaning set
forth in Section 3.4.

         1.43     Indemnitee. "Indemnitee" has the meaning set forth in Section
3.4.

         1.44     Indemnity Payment. "Indemnity Payment" has the meaning set
forth in Section 3.4.

         1.45     Information. "Information" means information, whether or not
patentable or copyrightable, in written, oral, electronic or other tangible or
intangible forms, stored in any medium, including studies, reports, records,
books, contracts, instruments, surveys, discoveries, ideas, concepts, know-how,
techniques, designs, specifications, drawings, blueprints, diagrams, models,
prototypes, samples, flow charts, data, computer data, disks, diskettes, tapes,
computer programs or other software, marketing plans, customer names,
communications by or to attorneys (including attorney-client privileged
communications), memos and other materials prepared by attorneys or under their
direction (including attorney work product), and other technical, financial,
employee or business information or data.

         1.46     Insurance Proceeds. "Insurance Proceeds" means those monies:

                  (a)      received by an insured from an insurance carrier; or

                  (b)      paid by an insurance carrier on behalf of the
         insured;

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in any such case net of any applicable premium adjustments (including reserves
and retrospectively rated premium adjustments) and net of any costs or expenses
(including allocated costs of in-house counsel and other personnel) incurred in
the collection thereof.

         1.47     Intellectual Property. "Intellectual Property" means all U.S.
and foreign intellectual and industrial property, including patent applications,
patents and any reissues or reexaminations thereof, trademarks, service marks,
trademark/service mark registrations and applications, brand names, trade names,
all other names and slogans embodying business or product goodwill (or both),
copyright registrations, mask works, copyrights, (including copyrights in
computer programs, software, computer code, documentation, programming tools,
drawings, specifications and data), moral rights of authorship, rights in
designs, trade secrets, technology, inventions, discoveries, improvements,
know-how, proprietary rights, formulae, processes, methods, technical
information, confidential and proprietary information, and all other
intellectual and industrial property rights, whether or not subject to statutory
registration or protection.

         1.48     Liabilities. "Liabilities" means any and all Indebtedness,
liabilities and obligations, whether accrued, fixed or contingent, mature or
inchoate, known or unknown, reflected on a balance sheet or otherwise,
including, but not limited to, those arising under any law, rule, regulation,
Action, order, injunction or consent decree of any Governmental Authority or any
judgment of any court of any kind or any award of any arbitrator of any kind,
and those arising under any contract, commitment or undertaking.

         1.49     Losses. "Losses" means any and all damages, losses,
deficiencies, Liabilities, obligations, penalties, judgments, settlements,
claims, payments, fines, interest costs and expenses (including, without
limitation, the costs and expenses of any and all Actions and demands,
assessments, judgments, settlements and compromises relating thereto and the
costs and expenses of attorneys', accountants', consultants' and other
professionals' fees and expenses incurred in the investigation or defense
thereof or the enforcement of rights hereunder), including direct and
consequential damages, but excluding punitive damages (other than punitive
damages awarded to any third party against an Indemnified Party).

         1.50     Master Separation Agreement. "Master Separation Agreement"
means that certain Master Separation Agreement dated as of December 31, 2000
between REI and Resources.

         1.51     NYSE. "NYSE" means the New York Stock Exchange.

         1.52     Person. "Person" means an individual, a partnership, a limited
partnership, a corporation, a limited liability company, an association, a joint
stock company, a trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political subdivision thereof.

         1.53     PUCT. "PUCT" means the Public Utility Commission of Texas.

         1.54     Record Date. "Record Date" means the close of business on the
date determined by the Board of Directors of CenterPoint as the record date for
determining the shareholders of CenterPoint entitled to receive shares of Genco
Common Stock in the Genco Distribution.

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         1.55     Regulatory Proceedings. "Regulatory Proceedings" means
filings, notices, adjudicatory proceedings, rulemakings, enforcement actions
before an agency or in court relative to regulatory activity, and any other
proceedings at or before any regulatory or administrative agency. The term shall
refer also to appellate activities relative to any of the foregoing, including
actions seeking injunctions, writs of mandamus and appeals.

         1.56     REI. "REI" has the meaning set forth in the recitals hereto.

         1.57     Resources. "Resources" has the meaning set forth in the
recitals hereto.

         1.58     Subsidiary. A "Subsidiary" of any Person means any corporation
or other organization whether incorporated or unincorporated of which at least a
majority of the securities or interests having by the terms thereof ordinary
voting power to elect at least a majority of the board of directors or others
performing similar functions with respect to such corporation or other
organization is directly or indirectly owned or controlled by such Person or by
any one or more of its Subsidiaries, or by such Person and one or more of its
Subsidiaries.

         1.59     Taxes. "Taxes" has the meaning set forth in the Genco Tax
Allocation Agreement.

         1.60     Technical Services Agreement. "Technical Services Agreement"
means that certain Technical Services Agreement dated as of December 31, 2000
between REI and Resources.

         1.61     Technical Services Assignment and Assumption Agreement.
"Technical Services Assignment and Assumption Agreement" means that certain
Assignment and Assumption Agreement for the Technical Services Agreement entered
into as of August 31, 2002 by and between Genco LP and REI under which Genco LP
assumed certain obligation of REI and REI assigned certain rights to Genco LP
under the Technical Services Agreement.

         1.62     Third Party Claim. "Third Party Claim" has the meaning set
forth in Section 3.5.

         1.63     Utilities Code. "Utilities Code" means the Utilities Code of
Texas.

                                       8

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                                   ARTICLE II

                 THE GENCO DISTRIBUTION AND THE ACTIONS PENDING
                             THE GENCO DISTRIBUTION

         2.1      DELIVERY OF SHARES FOR GENCO DISTRIBUTION. (a) On or prior to
the date the Genco Distribution is made (the "Genco Distribution Date"),
CenterPoint will deliver or cause to be delivered to the distribution agent to
be appointed by CenterPoint (the "Genco Distribution Agent") a single stock
certificate, endorsed by CenterPoint in blank, representing approximately 19.0%
of the shares of Genco Common Stock then owned by CenterPoint (the "Distribution
Shares") and shall cause the transfer agent for the shares of CenterPoint common
stock to instruct the Genco Distribution Agent to distribute on a prorata basis
on the Genco Distribution Date the appropriate number of such Distribution
Shares to each such holder of record or designated transferee or transferees of
such holder of record of CenterPoint common stock as of the Record Date.

                  (b)      Obligation to Provide Information. CenterPoint and
Genco, as the case may be, will provide to the Genco Distribution Agent all
share certificates and any information required in order to complete the Genco
Distribution on the basis specified above.

         2.2      ACTIONS PRIOR TO THE GENCO DISTRIBUTION. CenterPoint and Genco
shall use their reasonable commercial efforts to consummate the Genco
Distribution. Such efforts shall include, but not necessarily be limited to, the
following:

                  (a)      CenterPoint and Genco shall cooperate in preparing,
filing with the Commission and causing to become effective a registration
statement on Form 10 registering the Genco Common Stock under the Exchange Act.
CenterPoint and Genco shall each use its reasonable commercial efforts to obtain
all necessary approvals from the Commission with respect thereto as soon as
practicable.

                  (b)      CenterPoint and Genco shall prepare and mail, prior
to the Genco Distribution Date, to the holders of record of CenterPoint common
stock as of the Record Date such information concerning Genco and the Genco
Distribution and such other matters as CenterPoint shall reasonably determine
are necessary and as may be required by law.

                  (c)      CenterPoint and Genco shall take all such actions as
may be necessary or appropriate under the securities or blue sky laws of the
United States (and any comparable laws under any foreign jurisdiction) in
connection with the Genco Distribution.

                  (d)      Genco shall prepare and file, and shall use its
reasonable commercial efforts to have approved, an application for the listing
of the Genco Common Stock to be distributed in the Genco Distribution on the
NYSE, subject to official notice of distribution.

         2.3      CONDITIONS PRECEDENT TO THE GENCO DISTRIBUTION. The parties
hereto shall use their reasonable commercial efforts to satisfy the conditions
listed below to the consummation of the Genco Distribution. The obligations of
the parties to use their reasonable commercial efforts

                                       9

<PAGE>

to consummate the Genco Distribution shall be conditioned on the satisfaction,
or waiver by CenterPoint, of the following conditions:

                  (a)      The registration statement on Form 10 related to the
Genco Distribution shall have been filed with and declared effective by the
Commission, and no stop order shall be in effect with respect thereto.

                  (b)      The information concerning Genco and the Genco
Distribution described in Section 2.2(b) shall have been prepared and mailed to
the holders of common stock of CenterPoint.

                  (c)      The actions and filings with regard to state
securities and blue sky laws of the United States (and any comparable laws under
any foreign jurisdictions) described in Section 2.2(c) shall have been taken
and, where applicable, have become effective or been accepted.

                  (d)      The Genco Common Stock to be issued in the Genco
Distribution shall have been approved for listing on the NYSE, on official
notice of distribution.

                  (e)      CenterPoint shall be satisfied in its sole discretion
that it will satisfy the stock ownership requirements of Section 1504(a)(2) of
the Code with respect to the stock of Genco.

                  (f)      Any material Governmental Approvals necessary to
consummate the Genco Distribution shall have been obtained and be in full force
and effect.

                  (g)      No order, injunction or decree issued by any court or
agency of competent jurisdiction or other legal restraint or prohibition
preventing the consummation of the Genco Distribution or any of the other
transactions contemplated by this Agreement or any Ancillary Agreement shall be
in effect and no other event outside the control of Genco shall have occurred or
failed to occur that prevents the consummation of the Genco Distribution.

                  (h)      Such other actions as the parties hereto may, based
upon the advice of counsel, reasonably request to be taken prior to the Genco
Distribution in order to assure the successful completion of the Genco
Distribution shall have been taken.

                  (i)      This Agreement and all Ancillary Agreements have been
executed and shall not have been terminated.

                  (j)      No events or developments shall have occurred that,
in the judgment of the Board of Directors of CenterPoint, would result in the
Genco Distribution's having a material adverse effect on CenterPoint or on the
shareholders of CenterPoint.

         2.4      COOPERATION. Genco shall consult with, and cooperate in all
respects with, CenterPoint in connection with the Genco Distribution and shall,
at CenterPoint's direction, promptly take any and all actions necessary or
desirable to consummate the Genco Distribution.

         2.5      FRACTIONAL SHARES. CenterPoint shall direct the Genco
Distribution Agent to determine the number of whole shares and fractional shares
of Genco Common Stock allocable

                                       10

<PAGE>

to each holder of record of CenterPoint common stock as of the Record Date, to
aggregate all such fractional shares and to appoint an independent broker-dealer
that is not an Affiliate of CenterPoint or Genco (the "Independent
Broker-Dealer") to sell the whole shares obtained thereby in open market
transactions. The Independent Broker-Dealer shall, in its sole discretion,
determine when, how and at what price to make its sales. The Genco Distribution
Agent shall cause to be distributed to each such holder or for the benefit of
each such beneficial owner to which a fractional share shall be allocable such
holder's or owner's ratable share of the proceeds of such sales by the
Independent Broker Dealer, after making appropriate deductions of any amount
required to be withheld for federal income tax purposes. CenterPoint shall
direct the Genco Distribution Agent to aggregate the shares of CenterPoint
common stock known to be held by any beneficial owner thereof through more than
one account in determining the fractional share allocable to such beneficial
owner.

                                  ARTICLE III

                        MUTUAL RELEASES; INDEMNIFICATION

         3.1      RELEASE OF PRE-DISTRIBUTION CLAIMS.

                  (a)      Except as provided in Section 3.1(c), effective as of
the Genco Distribution Date, Genco does hereby, for itself and each other member
of the Genco Group, their respective Affiliates (other than any member of the
CenterPoint Group), successors and assigns, and all Persons who at any time
prior to the Genco Distribution Date have been shareholders, directors,
officers, agents or employees of any member of the Genco Group (in each case, in
their respective capacities as such), remise, release and forever discharge
CenterPoint, each member of the CenterPoint Group and their respective
Affiliates (other than any member of the Genco Group), successors and assigns,
and all Persons who at any time prior to the Genco Distribution Date have been
shareholders, directors, officers, agents or employees of any member of the
CenterPoint Group (in each case, in their respective capacities as such), and
their respective heirs, executors, administrators, successors and assigns, from
any and all Liabilities whatsoever to Genco and each other member of the Genco
Group, whether at law or in equity (including any right of contribution),
whether arising under any contract or agreement, by operation of law or
otherwise, existing or arising from any acts or events occurring or failing to
occur or alleged to have occurred or to have failed to occur or any conditions
existing or alleged to have existed on or before the Genco Distribution Date,
including in connection with the transactions and all other activities to
implement the Genco Distribution.

                  (b)      Except as provided in Section 3.1(c), effective as of
the Genco Distribution Date, CenterPoint does hereby, for itself and each other
member of the CenterPoint Business, their respective Affiliates (other than any
member of the Genco Group), successors and assigns, and all Persons who at any
time prior to the Genco Distribution Date have been shareholders, directors,
officers, agents or employees of any member of the CenterPoint Group (in each
case, in their respective capacities as such), remise, release and forever
discharge Genco, each member of the Genco Group, and their respective Affiliates
(other than any member of the CenterPoint Group), successors and assigns, and
all Persons who at any time prior to the Genco Distribution Date have been
shareholders, directors, officers, agents or employees of any member of the
Genco Business (in each case, in their respective capacities as such), and their

                                       11

<PAGE>

respective heirs, executors, administrators, successors and assigns, from any
and all Liabilities whatsoever to CenterPoint and each other member of the
CenterPoint Group, whether at law or in equity (including any right of
contribution), whether arising under any contract or agreement, by operation of
law or otherwise, existing or arising from any acts or events occurring or
failing to occur or alleged to have occurred or to have failed to occur or any
conditions existing or alleged to have existed on or before the Genco
Distribution Date, including in connection with the transactions and all other
activities to implement the Genco Distribution.

                  (c)      Nothing contained in Section 3.1(a) or (b) shall
impair any right of any Person to enforce this Agreement, any Ancillary
Agreement or any agreements, arrangements, commitments or understandings that
are specified in this Agreement or in any Ancillary Agreement. Nothing contained
in Section 3.1(a) or (b) shall release any Person from:

                           (i)      any Liability, contingent or otherwise,
                  assumed, transferred, assigned or allocated to the Group of
                  which such Person is a member in accordance with, or any other
                  Liability of any member of any Group under, this Agreement or
                  any Ancillary Agreement;

                           (ii)     any Liability for the sale, lease,
                  construction or receipt of goods, property or services
                  purchased, obtained or used in the ordinary course of business
                  by a member of one Group from a member of any other Group
                  prior to the Genco Distribution Date;

                           (iii)    any Liability for unpaid amounts for
                  products or services or refunds owing on products or services
                  due on a value-received basis for work done by a member of one
                  Group at the request or on behalf of a member of another
                  Business;

                           (iv)     any Liability that the parties may have with
                  respect to indemnification or contribution pursuant to this
                  Agreement for claims brought against the parties by third
                  Persons, which Liability shall be governed by the provisions
                  of this Article III and, if applicable, the appropriate
                  provisions of the Ancillary Agreements; or

                           (v)      any Liability the release of which would
                  result in the release of any Person other than a Person
                  released pursuant to this Section 3.1; provided that the
                  parties agree not to bring suit or permit any of their
                  Subsidiaries to bring suit against any Person with respect to
                  any Liability to the extent that such Person would be released
                  with respect to such Liability by this Section 3.1 but for the
                  provisions of this clause (v).

                  (d)      Genco shall not make, and shall not permit any member
of the Genco Group to make, any claim or demand, or commence any Action
asserting any claim or demand, including any claim of contribution or any
indemnification, against CenterPoint or any member of the CenterPoint Group, or
any other Person released pursuant to Section 3.1(a), with respect to any
Liabilities released pursuant to Section 3.1(a). CenterPoint shall not make, and
shall not permit any member of the CenterPoint Group to make, any claim or
demand, or commence any

                                       12

<PAGE>

Action asserting any claim or demand, including any claim of contribution or any
indemnification, against Genco or any member of the Genco Group, or any other
Person released pursuant to Section 3.1(b), with respect to any Liabilities
released pursuant to Section 3.1(b).

                  (e)      It is the intent of each of CenterPoint and Genco by
virtue of the provisions of this Section 3.1 to provide for a full and complete
release and discharge of all Liabilities existing or arising from all acts and
events occurring or failing to occur or alleged to have occurred or to have
failed to occur and all conditions existing or alleged to have existed on or
before the Genco Distribution Date, between or among Genco or any member of the
Genco Group, on the one hand, and CenterPoint or any member of the CenterPoint
Group, on the other hand (including any contractual agreements or arrangements
existing or alleged to exist between or among any such members on or before the
Genco Distribution Date), except as expressly set forth in Section 3.1(c). At
any time, at the request of any other party, each party shall cause each member
of its respective Group to execute and deliver releases reflecting the
provisions hereof.

         3.2      INDEMNIFICATION BY GENCO. Except as provided in Section 3.4,
Genco shall, and in the case of clauses (a), (b) and (c) below shall in addition
cause the Appropriate Member of the Genco Group (as defined below) to,
indemnify, defend and hold harmless CenterPoint, each member of the CenterPoint
Group and each of their respective directors, officers and employees, and each
of the heirs, executors, successors and assigns of any of the foregoing
(collectively, the "CenterPoint Indemnitees") from and against any and all
Losses of the CenterPoint Indemnitees relating to, arising out of or resulting
from any of the following (without duplication):

                  (a)      the failure of Genco or any other member of the Genco
Group or any other Person to pay, perform or otherwise promptly discharge any
Genco Liabilities in accordance with their respective terms, whether prior to or
after the Genco Distribution Date or the date thereof;

                  (b)      the Genco Business or any Genco Liability;

                  (c)      any breach by Genco or any member of the Genco Group
of this Agreement or any of the Ancillary Agreements; and

                  (d)      any untrue statement or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
with respect to all information contained in the registration statement on Form
10 and the related information statement sent to the holders of CenterPoint's
common stock related to the Genco Distribution (other than information regarding
CenterPoint provided by CenterPoint to Genco for inclusion therein).

As used in this Section 3.2, "Appropriate Member of the Genco Group" means the
member or members of the Genco Group, if any, whose acts, conduct or omissions
or failures to act caused, gave rise to or resulted in the loss from and against
which indemnity is provided.

         3.3      INDEMNIFICATION BY CENTERPOINT. Except as provided in Section
3.4, CenterPoint shall, and in the case of clauses (a), (b) and (c) below shall
in addition cause the Appropriate Member of the CenterPoint Group (as defined
below) to, indemnify, defend and hold harmless Genco, each member of the Genco
Group and each of their respective directors,

                                       13

<PAGE>

officers and employees, and each of the heirs, executors, successors and assigns
of any of the foregoing (collectively, the "Genco Indemnitees") from and against
any and all Losses of the Genco Indemnitees relating to, arising out of or
resulting from any of the following (without duplication):

                  (a)      the failure of CenterPoint or any other member of the
CenterPoint Group or any other Person to pay, perform or otherwise promptly
discharge any Liabilities of any member of the CenterPoint Group other than the
Genco Liabilities, in accordance with their respective terms, whether prior to
or after the Genco Distribution Date or the date hereof;

                  (b)      the CenterPoint Business or any Liability of any
member of the CenterPoint Group other than the Genco Liabilities;

                  (c)      any breach by CenterPoint or any member of the
CenterPoint Group of this Agreement or any of the Ancillary Agreements; and

                  (d)      any untrue statement or alleged untrue statement of a
material fact or omission or alleged omission to state a material fact required
to be stated therein or necessary to make the statements therein not misleading,
with respect to information regarding CenterPoint provided by CenterPoint to
Genco for inclusion in the registration statement on Form 10 or the information
statement sent to the holders of CenterPoint's common stock related to the Genco
Distribution.

As used in this Section 3.3, "Appropriate Member of the CenterPoint Group" means
the member or members of the CenterPoint Group, if any, whose acts, conduct or
omissions or failures to act caused, gave rise to or resulted in the Loss from
and against which indemnity is provided.

         3.4      INDEMNIFICATION OBLIGATIONS NET OF INSURANCE PROCEEDS AND
OTHER AMOUNTS. (a) The parties intend that any Loss subject to indemnification
or reimbursement pursuant to this Article III will be net of Insurance Proceeds
that actually reduce the amount of the Loss. Accordingly, the amount which any
party (an "Indemnifying Party") is required to pay to any Person entitled to
indemnification hereunder (an "Indemnitee") will be reduced by any Insurance
Proceeds theretofore actually recovered by or on behalf of the Indemnitee in
reduction of the related Loss. If an Indemnitee receives a payment (an
"Indemnity Payment") required by this Agreement from an Indemnifying Party in
respect of any Loss and subsequently receives Insurance Proceeds, then the
Indemnitee will pay to the Indemnifying Party an amount equal to the excess of
the Indemnity Payment received over the amount of the Indemnity Payment that
would have been due if the Insurance Proceeds recovery had been received,
realized or recovered before the Indemnity Payment was made.

                  (b)      An insurer who would otherwise be obligated to pay
any claims shall not be relieved of the responsibility with respect thereto or,
solely by virtue of the indemnification provisions hereof, have any subrogation
rights with respect thereto, it being expressly understood and agreed that no
insurer or any other third party shall be entitled to a "windfall" (i.e., a
benefit they would not be entitled to receive in the absence of the
indemnification provisions) by virtue of the indemnification provisions hereof.
Nothing contained in this Agreement or any Ancillary

                                       14

<PAGE>

Agreement shall obligate any member of any Business to seek to collect or
recover any Insurance Proceeds.

         3.5      PROCEDURES FOR INDEMNIFICATION OF THIRD PARTY CLAIMS. (a) If
an Indemnitee shall receive notice or otherwise learn of the assertion by a
Person (including any Governmental Authority) who is not a member of the
CenterPoint Group or the Genco Group of any claims or of the commencement by any
such Person of any Action (collectively, a "Third Party Claim") with respect to
which an Indemnifying Party may be obligated to provide indemnification to such
Indemnitee pursuant to Section 3.2 or 3.3, or any other Section of this
Agreement or any Ancillary Agreement, such Indemnitee shall give such
Indemnifying Party written notice thereof within 20 days after becoming aware of
such Third Party Claim. Any such notice shall describe the Third Party Claim in
reasonable detail. Notwithstanding the foregoing, the failure of any Indemnitee
or other Person to give notice as provided in this Section 3.5(a) shall not
relieve the related Indemnifying Party of its obligations under this Article
III, except to the extent that such Indemnifying Party is actually prejudiced by
such failure to give notice.

                  (b)      An Indemnifying Party may elect to defend (and,
unless the Indemnifying Party has specified any reservations or exceptions, to
seek to settle or compromise), at such Indemnifying Party's own expense and by
such Indemnifying Party's own counsel, any Third Party Claim. Within 30 days
after the receipt of notice from an Indemnitee in accordance with Section 3.5(a)
(or sooner, if the nature of such Third Party Claim so requires), the
Indemnifying Party shall notify the Indemnitee of its election whether the
Indemnifying Party will assume responsibility for defending such Third Party
Claim, which election shall specify any reservations or exceptions. After notice
from an Indemnifying Party to an Indemnitee of its election to assume the
defense of a Third Party Claim, such Indemnitee shall have the right to employ
separate counsel and to participate in (but not control) the defense,
compromise, or settlement thereof, but the fees and expenses of such counsel
shall be the expense of such Indemnitee except as set forth in the next
sentence. In the event that the Indemnifying Party has elected to assume the
defense of the Third Party Claim but has specified, and continues to assert, any
reservations or exceptions in such notice, then, in any such case, the
reasonable fees and expenses of one separate counsel for all Indemnitees shall
be borne by the Indemnifying Party.

                  (c)      If an Indemnifying Party elects not to assume
responsibility for defending a Third Party Claim, or fails to notify an
Indemnitee of its election as provided in Section 3.5(b), such Indemnitee may
defend such Third Party Claim at the cost and expense (included allocated costs
of in-house counsel and other personnel) of the Indemnifying Party.

                  (d)      Unless the Indemnifying Party has failed to assume
the defense of the Third Party Claim in accordance with the terms of this
Agreement, no Indemnitee may settle or compromise any Third Party Claim without
the consent of the Indemnifying Party.

                  (e)      No Indemnifying Party shall consent to entry of any
judgment or enter into any settlement of the Third Party Claim without the
consent of an Indemnitee if the effect thereof is to permit any injunction,
declaratory judgment, other order or other nonmonetary relief to be entered,
directly or indirectly, against such Indemnitee.

                                       15

<PAGE>

                  (f)      The provisions of Section 3.2 through 3.5 shall not
apply to Taxes (which are covered by the Genco Tax Allocation Agreement).

         3.6      ADDITIONAL MATTERS. (a) Any claim on account of a Loss that
does not result from a Third Party Claim shall be asserted by written notice
given by the Indemnitee to the related Indemnifying Party. Such Indemnifying
Party shall have a period of 30 days after the receipt of such notice within
which to respond thereto. If such Indemnifying Party does not respond within
such 30-day period, such Indemnifying Party shall be deemed to have refused to
accept responsibility to make payment. If such Indemnifying Party does not
respond within such 30-day period or rejects such claim in whole or in part,
such Indemnitee shall be free to pursue such remedies as may be available to
such party as contemplated by this Agreement and the Ancillary Agreements.

                  (b)      In the event of payment by or on behalf of any
Indemnifying Party to any Indemnitee in connection with any Third Party Claim,
such Indemnifying Party shall be subrogated to and shall stand in the place of
such Indemnitee as to any events or circumstances in respect of which such
Indemnitee may have any right, defense or claim relating to such Third Party
Claim against any claimant or plaintiff asserting such Third Party Claim or
against any other person. Such Indemnitee shall cooperate with such Indemnifying
Party in a reasonable manner, and at the cost and expense (including allocated
costs of in-house counsel and other personnel) of such Indemnifying Party, in
prosecuting any subrogated right, defense or claim.

                  (c)      In the event of an Action in which the Indemnifying
Party is not a named defendant, if either the Indemnified Party or Indemnifying
Party shall so request, the parties shall endeavor to substitute the
Indemnifying Party for the named defendant, if at all practicable. If such
substitution or addition cannot be achieved for any reason or is not requested,
the named defendant shall allow the Indemnifying Party to manage the Action as
set forth in this Section 3.6 and the Indemnifying Party shall fully indemnify
the named defendant against all costs of defending the Action (including court
costs, sanctions imposed by a court, attorneys' fees, experts' fees and all
other external expenses, and the allocated costs of in-house counsel and other
personnel), the costs of any judgment or settlement, and the cost of any
interest or penalties relating to any judgment or settlement.

                  (d)      THE PARTIES UNDERSTAND AND AGREE THAT THE
INDEMNIFICATION OBLIGATIONS HEREUNDER AND UNDER THE ANCILLARY AGREEMENTS MAY
INCLUDE INDEMNIFICATION FOR LOSSES RESULTING FROM, OR ARISING OUT OF, DIRECTLY
OR INDIRECTLY, AN INDEMNIFIED PARTY'S OWN NEGLIGENCE OR STRICT LIABILITY.

         3.7      REMEDIES CUMULATIVE. The remedies provided in this Article III
shall be cumulative and, subject to the provisions of Article VII, shall not
preclude assertion by any Indemnitee of any other rights or the seeking of any
and all other remedies against any Indemnifying Party.

         3.8      SURVIVAL OF INDEMNITIES. The rights and obligations of each
CenterPoint and Genco and their respective Indemnitees under this Article III
shall survive the sale or other transfer by any party of any Assets or
businesses or the assignment by it of any Liabilities.

                                       16

<PAGE>

         3.9      INDEMNIFICATION OF DIRECTORS AND OFFICERS. For purpose of
Sections 3.2 through 3.8, inclusive, and notwithstanding anything to the
contrary contained herein, Persons who serve on both the Board of Directors of
Genco and the Board of Directors of CenterPoint and persons who serve as
officers of both Genco and CenterPoint shall be deemed both Genco Indemnitees
and CenterPoint Indemnitees.

                                   ARTICLE IV

                 CORPORATE GOVERNANCE AND CERTAIN OTHER MATTERS

         4.1      CHARTER, BYLAWS AND BOARD OF DIRECTORS OF GENCO. As of the
Genco Distribution Date, (i) the Amended and Restated Articles of Incorporation
and Amended and Restated Bylaws of Genco shall be in the forms attached to
Schedule 4.1(a) and 4.1(b) hereto, respectively, which shall comply in all
material respects with the requirements set forth in Sections 2.3 and 8.2 of the
Genco Option Agreement, and (ii) the individuals named in Schedule 4.1(c) shall
constitute the Board of Directors of Genco.

         4.2      ISSUANCE OF STOCK. In addition to and without limiting the
scope of any restrictions arising under Section 3.6 of the Genco Option
Agreement, following the Genco Distribution Date, without the prior consent of
CenterPoint, Genco shall not issue any stock of Genco or any securities,
options, warrants or rights convertible into or exercisable or exchangeable for
stock of Genco.

                                    ARTICLE V

                              INTELLECTUAL PROPERTY

         5.1      ASSIGNMENT. CenterPoint hereby assigns to Genco all of its
right, title and interest in and to the Genco Intellectual Property; the
goodwill of CenterPoint symbolized by any trademarks or service marks assigned
hereunder; and all rights of action accrued or to accrue under or by virtue of
any of the Genco Intellectual Property, including the right to sue and recover
for past infringement or misappropriation.

         5.2      LICENSE GRANTS

                  (a)      Grants to CenterPoint. Except as provided below in
this Section 5.2(a), Genco grants to each Person within the CenterPoint Group a
worldwide, perpetual, royalty-free license to use in the CenterPoint Field of
Use the Genco Intellectual Property, including the right to sublicense customers
or suppliers of CenterPoint or its Subsidiaries to the extent necessary for such
customers to use in the CenterPoint Field of Use products or services of
CenterPoint or its Subsidiaries and for such suppliers to provide equipment or
services to CenterPoint or its Subsidiaries in connection with their operations
in the CenterPoint Field of Use. This license specifically excludes any grant to
any Person within the CenterPoint Group of any rights to use any trademarks,
service marks, trademark/service mark registrations and applications, brand
names, trade names, or other names and slogans embodying business or product
goodwill (or both) which are a part of the Genco Intellectual Property.

                                       17

<PAGE>

                  (b)      Grants to Genco. Except as provided below in this
Section 5.2(b), CenterPoint grants to each Person within the Genco Group a
worldwide, perpetual, royalty-free license to use the CenterPoint Intellectual
Property, including the right to sublicense customers or suppliers of Genco or
its Subsidiaries to the extent necessary for such customers to use the products
or services of Genco or its Subsidiaries and for such suppliers to provide
equipment or services to Genco or its Subsidiaries in connection with their
operations. This license specifically excludes any grant to any Person within
the Genco Group of any rights to use any trademarks, service marks,
trademark/service mark registrations and applications, brand names, trade names,
or other names and slogans embodying business or product goodwill (or both)
which are a part of the CenterPoint Intellectual Property.

         5.3      COOPERATION AND FURTHER UNDERTAKINGS. CenterPoint agrees that
it and its Subsidiaries shall, without additional compensation, execute and
deliver further instruments of conveyance, transfer and assignment as requested
by Genco, its successors, or assigns; reasonably cooperate and assist in
providing information for making and completing regulatory and other filings;
and take any and all other actions as Genco, its successors, or assigns may
reasonably require to (1) effectively assign, convey and transfer the Genco
Intellectual Property and any associated goodwill, and all rights therein to
Genco, its successors, or assigns and (2) to protect, enforce and exploit the
Genco Intellectual Property. Genco agrees that it will continue to prosecute any
patent applications which it is currently prosecuting, but if it determines that
any such application should be abandoned, it will inform CenterPoint of its
decision and on request will assign to CenterPoint all its rights.

         5.4      CENTERPOINT DISCLAIMER OF WARRANTIES. CENTERPOINT AND ITS
SUBSIDIARIES DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT
LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE AND NON-INFRINGEMENT, WITH RESPECT TO THE GENCO INTELLECTUAL PROPERTY
AND THE CENTERPOINT INTELLECTUAL PROPERTY. CENTERPOINT AND ITS SUBSIDIARIES MAKE
NO REPRESENTATIONS OR WARRANTIES AS TO THE QUALITY, SUITABILITY, VALIDITY OR
ADEQUACY OF THE GENCO INTELLECTUAL PROPERTY OR THE CENTERPOINT INTELLECTUAL
PROPERTY FOR ANY PURPOSE OR USE.

         5.5      GENCO DISCLAIMER OF WARRANTIES. GENCO AND ITS SUBSIDIARIES
DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT LIMITED TO, THE
IMPLIED WARRANTIES OF MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE AND
NON-INFRINGEMENT, WITH RESPECT TO THE GENCO INTELLECTUAL PROPERTY. GENCO AND ITS
SUBSIDIARIES MAKE NO REPRESENTATIONS OR WARRANTIES AS TO THE QUALITY,
SUITABILITY, VALIDITY OR ADEQUACY OF THE GENCO INTELLECTUAL PROPERTY FOR ANY
PURPOSE OR USE.

                                   ARTICLE VI

                              ENVIRONMENTAL MATTERS

         6.1      DEFINITIONS. The following definitions apply to this Article
                  VI:

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<PAGE>

                  (a)      "CenterPoint Real Property" means land and
improvements as to which fee title, or (except where fee title thereto has been
conveyed to Genco as part of the Genco Assets) any leasehold, easement or other
real property interest therein, is owned by CenterPoint or any Affiliate thereof
which is located adjacent to or in the vicinity of any land constituting, or any
interest in which constitutes, Genco Real Property.

                  (b)      "Environmental Conditions" means any pollution,
contamination, degradation, damage or injury caused by, related to, arising
from, or in connection with the generation, handling, use, treatment, storage,
transportation, disposal, discharge, Release (as that term is defined below), or
emission of any "Waste Materials."

                  (c)      "Environmental Law" or "Environmental Laws" means all

laws, rules, regulations, statutes, ordinances, decrees or orders, now,
heretofore or hereafter in force, of any Governmental Authority and relating to
(i) the control of any potential pollutant or protection of the air, water or
land, (ii) solid, gaseous or liquid waste generation, handling, treatment,
storage, disposal or transportation, and (iii) exposure to hazardous, toxic or
other substances alleged to be harmful, and includes without limitation, (1) the
terms and conditions of any license, permit, approval, or other authorization by
any governmental entity, and (2) judicial, administrative, or other regulatory
decrees, judgments, and orders of any governmental entity. The term
"Environmental Laws" shall include, but not be limited to the following statutes
and the regulations promulgated thereunder: the Clean Air Act, 42 U.S.C. Section
1401 et seq., the Clean Water Act, 33 U.S.C. Section 1251 et seq., the Resource
Conservation Recovery Act ("RCRA"), 42 U.S.C. Section 6901 et seq., the
Superfund Amendments and Reauthorization Act, 42 U.S.C. Section 11011 et seq.,
the Toxic Substances Control Act, 15 U.S.C. Section 2601 et seq., the Water
Pollution Control Act, 33 U.S.C. Section 1251, et seq., the Safe Drinking Water
Act, 42 U.S.C. Section 300f et seq., the Comprehensive Environmental Response,
Compensation, and Liability Act ("CERCLA"), 42 U.S.C. Section 9601 et seq., and
any state, county, or local regulations similar thereto.

                  (d)      "Environmental Liabilities" shall mean any and all
Liabilities, responsibilities, claims, suits, Losses, costs (including
remediation, removal, response, abatement, clean-up, investigative, and/or
monitoring costs and any other related costs and expenses), other causes of
action recognized now or at any later time, damages, settlements, expenses,
charges, assessments, liens, penalties, fines, pre-judgment and post-judgment
interest, attorney fees and other legal fees (a) pursuant to any agreement,
order, notice, requirement, responsibility, or directive (including directives
embodied in Environmental Laws), injunction, judgment or similar documents
(including settlements), or (b) pursuant to any claim by a governmental entity
or other person or entity for personal injury, property damage, damage to
natural resources, remediation, or similar costs or expenses incurred or
asserted by such entity or person pursuant to common law or statute.

                  (e)      "Genco Real Property" means all land and improvements
as to which fee title, or (except where fee title thereto was retained by
CenterPoint or any Affiliate thereof) any leasehold, easement or other real
property interest therein, has been conveyed to Genco as part of the Genco
Assets.

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<PAGE>

                  (f)      "Release" means any spilling, leaking, pumping,
pouring, emitting, emptying, discharging, injecting, escaping, leaching,
dumping, or disposing into the environment.

                  (g)      "Waste Materials" means any (i) toxic or hazardous
materials or substances; (ii) solid wastes; (iii) radioactive materials; (iv)
petroleum wastes and Releases of petroleum products; (v) Releases of any other
substance that is regulated; and (iv) Releases which could be required to be
remediated by any Governmental Authority under any applicable Environmental Law.

         6.2      ENVIRONMENTAL LIABILITIES. Notwithstanding the general
definitions of Genco Liabilities and Genco Excluded Liabilities contained in
Article I, Environmental Liabilities related to the Genco Business and Genco
Real Property and CenterPoint Business and CenterPoint Real Property shall be
allocated between Genco (and thus included in Genco Liabilities) and CenterPoint
(and thus included in Genco Excluded Liabilities) as set forth in this Article
VI.

         6.3      GENCO EXCLUDED LIABILITIES. Genco Excluded Liabilities shall
include the following Environmental Liabilities:

                  (a)      those resulting from or arising in connection with
operation of the CenterPoint Business, including any such Environmental
Liabilities resulting from Releases of Waste Materials to, from, at, on or
beneath the Genco Real Property ("CenterPoint Business Environmental
Liabilities").

                  (b)      those, other than Genco Business Environmental
Liabilities (as defined below), resulting from or arising in connection with
Releases of Waste Materials to, from, at, on or beneath the CenterPoint Real
Property.

         6.4      GENCO LIABILITIES. Genco Liabilities shall include the
following Environmental Liabilities:

                  (a)      those resulting from or arising in connection with
operation of the Genco Business, including any such Environmental Liabilities
resulting from Releases of Waste Materials to, from, at, on or beneath the
CenterPoint Real Property ("Genco Business Environmental Liabilities").

                  (b)      those, other than CenterPoint Business Environmental
Liabilities, resulting from or arising in connection with Releases of Waste
Materials to, from, at, on or beneath the Genco Real Property.

         6.5      POST-SEPARATION DATE ENVIRONMENTAL ARRANGEMENTS. Each Party
shall cooperate with the other on a reasonable basis with respect to
Environmental Conditions as to which such other Party reasonably anticipates
liability or the first Party anticipates that such other Party may have
liability. Such cooperation shall include sharing relevant information on a
timely basis (other than that protected by attorney-client or other
non-disclosure privilege according to law). It shall also include, subject to
the reasonable needs and requirements of the first Party based on its own
operations, reasonable access for investigatory and/or remedial

                                       20

<PAGE>

purposes, and reasonable use of on-site facilities and utilities, all at such
other Party's cost insofar as out-of-pocket expenses incurred as a result of
such activities are concerned. Further, each Party agrees to act in good faith
in undertaking work to investigate or remediate Environmental Conditions that
may give rise to a claim for indemnification hereunder with a view to avoiding
unnecessary or excessive costs.

                                  ARTICLE VII

                         ARBITRATION; DISPUTE RESOLUTION

         7.1      AGREEMENT TO ARBITRATE. Except as otherwise specifically
provided in any Ancillary Agreement, the procedures for discussion, negotiation
and arbitration set forth in this Article VII shall apply to all disputes,
controversies or claims (whether sounding in contract, tort or otherwise) that
may arise out of, under or in connection with, or relate to, this Agreement or
any Ancillary Agreement, the transactions contemplated hereby or thereby
(including all actions taken in furtherance of the transactions contemplated
hereby or thereby on or prior to the date hereof), or (for a period of ten years
after the date hereof) the commercial or economic relationship of the parties
relating hereto or thereto, between or among any member of the CenterPoint Group
and the Genco Group. Each party agrees on behalf of itself and each member of
its respective Group that the procedures set forth in this Article VII shall be
the sole and exclusive remedy in connection with any dispute, controversy or
claim relating to any of the foregoing matters and irrevocably waives any right
to commence any Action in or before any Governmental Authority, except as
expressly provided in Section 7.7 and except to the extent provided under the
Federal Arbitration Act in the case of judicial review of arbitration results or
awards. Each party on behalf of itself and each member of its respective Group
irrevocably waives any right to any trial by jury with respect to any claim,
controversy or dispute set forth in this Section 7.1.

         7.2      ESCALATION. (a) It is the intent of the parties to use their
respective reasonable best efforts to resolve expeditiously and on a mutually
acceptable negotiated basis any dispute, controversy or claim between or among
them with respect to the matters covered hereby that may arise from time to
time. In furtherance of the foregoing, any party involved in a dispute,
controversy or claim may deliver a notice (an "Escalation Notice") demanding an
in-person meeting involving representatives of the parties at a senior level of
management of the parties (or if the parties agree, of the appropriate strategic
business unit or division within such entity). A copy of any such Escalation
Notice shall be given to the General Counsel or like officer or official of each
party involved in the dispute, controversy or claim (which copy shall state that
it is an Escalation Notice pursuant to this Agreement). Any agenda, location or
procedures for such discussions or negotiations between the parties may be
established by the parties from time to time; provided, however, that the
parties shall use their reasonable efforts to meet within 30 days of the date of
delivery of the Escalation Notice.

                  (b)      The parties may, by mutual consent, retain a mediator
to aid the parties in their discussions and negotiations by informally providing
advice to parties. Any opinion expressed by the mediator shall be strictly
advisory and shall not be binding on the parties, nor shall any opinion
expressed by the mediator be admissible in any arbitration proceedings. The
mediator may be chosen from a list of mediators previously selected by the
parties or by other

                                       21

<PAGE>

agreement of the parties. Costs of the mediation shall be borne equally by the
parties involved in the matter, except that each party shall be responsible for
its own expenses. Mediation is not a prerequisite to a demand for arbitration
under Section 7.3.

         7.3      DEMAND FOR ARBITRATION. (a) At any time after the first to
occur of (i) the date of the meeting actually held pursuant to the applicable
Escalation Notice or (ii) 45 days after the delivery of an Escalation Notice (as
applicable, the "Arbitration Demand Date"), any party involved in the dispute,
controversy or claim (regardless of whether that party delivered the Escalation
Notice) may deliver a notice demanding arbitration of that dispute, controversy
or claim (a "Arbitration Demand Notice"). In the event that any party shall
deliver an Arbitration Demand Notice to another party, that other party may
itself deliver an Arbitration Demand Notice to the first party with respect to
any related dispute, controversy or claim with respect to which the Applicable
Deadline (as defined below) has not passed without the requirement of delivering
an Escalation Notice. No party may assert that the failure to resolve any matter
during any discussions or negotiations, the course of conduct during the
discussions or negotiations or the failure to agree on a mutually acceptable
time, agenda, location or procedures for the meeting, in each case, as
contemplated by Section 7.2, is a prerequisite to a demand for arbitration under
Section 7.3. In the event that any party delivers an Arbitration Demand Notice
with respect to any dispute, controversy or claim that is the subject of any
then pending arbitration proceeding or of a previously delivered Arbitration
Demand Notice, all such disputes, controversies and claims shall be resolved in
the arbitration proceeding for which an Arbitration Demand Notice was first
delivered unless the arbitrator in his or her sole discretion determines that it
is impracticable or otherwise inadvisable to do so.

                  (b)      Except as may be expressly provided in any Ancillary
Agreement, any Arbitration Demand Notice may be given until one year and 45 days
after the later of the occurrence of the act or event giving rise to the
underlying claim or the date on which such act or event was, or should have
been, in the exercise of reasonable due diligence, discovered by the party
asserting the claim (as applicable and as it may in a particular case be
specifically extended by the parties in writing, the "Applicable Deadline"). Any
discussions, negotiations or mediations between the parties pursuant to this
Agreement or otherwise will not toll the Applicable Deadline unless expressly
agreed in writing by the parties. Each of the parties agrees on behalf of itself
and each member of its Group that if an Arbitration Demand Notice with respect
to a dispute, controversy or claim is not given prior to the expiration of the
Applicable Deadline, as between or among the parties and the members of their
Groups, such dispute, controversy or claim will be barred. Subject to Section
7.7(d), upon delivery of an Arbitration Demand Notice pursuant to Section 7.3(a)
prior to the Applicable Deadline, the dispute, controversy or claim shall be
decided by a sole arbitrator in accordance with the rules set forth in this
Article VI.

         7.4      ARBITRATORS. (a) Within 15 days after a valid Arbitration
Demand Notice is given, the parties involved in the dispute, controversy or
claim referred to therein shall attempt to select a sole arbitrator satisfactory
to all such parties.

                  (b)      In the event that the parties are not able jointly to
select a sole arbitrator within that 15-day period, the parties shall each
appoint an arbitrator (who need not be disinterested as to the parties or the
matter) within 30 days after delivery of the Arbitration

                                       22

<PAGE>

Demand Notice. If one party appoints an arbitrator within such time period and
the other party or parties fail to appoint an arbitrator within such time
period, the arbitrator appointed by the one party shall be the sole arbitrator
of the matter.

                  (c)      In the event that a sole arbitrator is not selected
pursuant to paragraph (a) or (b) above, the two arbitrators will, within 30 days
after the appointment of the later of them to be appointed, select an additional
arbitrator who shall act as the sole arbitrator of the dispute. After selection
of such sole arbitrator, the initial arbitrators shall have no further role with
respect to the dispute. In the event that the arbitrators so appointed do not,
within 30 days after the appointment of the later of them to be appointed, agree
on the selection of the sole arbitrator, any party involved in such dispute may
apply to the Senior Judge of the U.S. District Court for the Southern District
of Texas to select the sole arbitrator, which selection shall be made by such
Person within 30 days after such application. Any arbitrator selected pursuant
to this paragraph (c) shall be disinterested with respect to each of the parties
and shall be reasonably competent in the applicable subject matter.

                  (d)      The sole arbitrator selected pursuant to paragraph
(a), (b) or (c) above will set a time for the hearing of the matter, which will
commence no later than 90 days after the date of appointment of the sole
arbitrator pursuant to paragraph (a), (b) or (c) above and which will be no
longer than 30 days (unless in the judgment of the arbitrator the matter is
unusually complex and sophisticated and thereby requires a longer time, in which
event the hearing shall be no longer than 90 days). The final decision of the
arbitrator will be rendered in writing to the parties not later than 60 days
after the last hearing date, unless otherwise agreed by the parties in writing.

                  (e)      The place of any arbitration hereunder will be
Houston, Texas, unless otherwise agreed by the parties.

         7.5      HEARINGS. Within the time period specified in Section 7.4(d),
the matter shall be presented to the arbitrator at a hearing by means of written
submissions of memoranda and verified witness statements, filed simultaneously,
and responses, if necessary in the judgment of the arbitrator or both the
parties. If the arbitrator deems it to be essential to a fair resolution of the
dispute, live cross-examination or direct examination may be permitted but is
not generally contemplated to be necessary. The arbitrator shall actively manage
the arbitration with a view to achieving a just, speedy and cost-effective
resolution of the dispute, claim or controversy. The arbitrator may, in his or
her discretion, set time and other limits on the presentation of each party's
case, its memoranda or other submissions, and refuse to receive any proffered
evidence, which the arbitrator, in his or her discretion, finds to be
cumulative, unnecessary, irrelevant or of low probative value. Except as
otherwise set forth herein, any arbitration hereunder will be conducted in
accordance with the procedures of the Center for Public Resources of New York
("CPR"). The decision of the arbitrator will be final and binding on the
parties, and judgment thereon may be had and will be enforceable in any court
having jurisdiction over the parties. Arbitration awards will bear interest at
an annual rate of the Prime Rate plus 2% per annum, or, if lower, the maximum
amount permitted by applicable law. To the extent that the provisions of this
Agreement and the prevailing rules of the CPR conflict, the provisions of this
Agreement shall govern.

                                       23

<PAGE>

         7.6      DISCOVERY AND CERTAIN OTHER MATTERS. (a) Any party involved in
a dispute subject to this Article VII may request limited document production
from the other party or parties of specific and expressly relevant documents,
with the reasonable expenses of the producing party incurred in such production
paid by the requesting party. The right to documents permitted herein shall be
substantially less than document discovery rights prevailing under the Federal
Rules of Civil Procedure. Any such discovery shall be conducted expeditiously
and shall not cause the hearing provided for in Section 7.5 to be adjourned
except upon consent of all parties involved in the applicable dispute or upon an
extraordinary showing of cause demonstrating that such adjournment is necessary
to permit discovery essential to a party to the proceeding. Depositions,
interrogatories or other forms of discovery (other than the document production
set forth above) shall not occur except by consent of the parties involved in
the applicable dispute. Disputes concerning the scope of document production and
enforcement of the document production requests will be determined by written
agreement of the parties involved in the applicable dispute or, failing such
agreement, will be referred to the arbitrator for resolution. All discovery
requests will be subject to the parties' rights to claim any applicable
privilege. The arbitrator will adopt procedures to protect the proprietary
rights of the parties and to maintain the confidential treatment of the
arbitration proceedings (except as may be required by law). Subject to the
foregoing, the arbitrator shall have the power to issue subpoenas to compel the
production of documents relevant to the dispute, controversy or claim.

                  (b)      The arbitrator shall have full power and authority to
determine issues of arbitrability but shall otherwise be limited to interpreting
or construing the applicable provisions of this Agreement or any Ancillary
Agreement, and will have no authority or power to limit, expand, alter, amend,
modify, revoke or suspend any condition or provision of this Agreement or any
Ancillary Agreement; it being understood, however, that the arbitrator will have
full authority to implement the provisions of this Agreement or any Ancillary
Agreement and to fashion appropriate remedies for breaches of this Agreement
(including interim or permanent injunctive relief); provided that the arbitrator
shall not have (i) any authority in excess of the authority a court having
jurisdiction over the parties and the controversy or dispute would have absent
these arbitration provisions or (ii) any right or power to award punitive or
double or treble damages. It is the intention of the parties that in rendering a
decision the arbitrator give effect to the applicable provisions of this
Agreement and the Ancillary Agreements and follow applicable law (it being
understood and agreed that this sentence shall not give rise to a right of
judicial review of the arbitrator's award).

                  (c)      If a party fails or refuses to appear at and
participate in an arbitration hearing after due notice, the arbitrator may hear
and determine the controversy upon evidence produced by the appearing party.

                  (d)      Arbitration costs will be borne equally by each party
involved in the matter, except that each party will be responsible for its own
attorney's fees and other costs and expenses (except as set forth in Section
7.6(a)), including the costs of witnesses selected by such party.

         7.7      CERTAIN ADDITIONAL MATTERS. (a) Any arbitration award shall be
a bare award limited to a holding for or against a party and shall be without
findings as to facts, issues or conclusions of law (including with respect to
any matters relating to the validity or infringement

                                       24

<PAGE>

of patents or patent applications) and shall be without a statement of the
reasoning on which the award rests, but must be in adequate form so that a
judgment of a court may be entered thereupon. Judgment upon any arbitration
award hereunder may be entered in any court having jurisdiction thereof.

                  (b)      Prior to the time at which an arbitrator is appointed
pursuant to Section 7.4, any party may seek one or more temporary restraining
orders in a court of competent jurisdiction if necessary in order to preserve
and protect the status quo. Neither the request for, or grant or denial of, any
such temporary restraining order shall be deemed a waiver of the obligation to
arbitrate as set forth herein and the arbitrator may dissolve, continue or
modify any such order. Any such temporary restraining order shall remain in
effect until the first to occur of the expiration of the order in accordance
with its terms or the dissolution thereof by the arbitrator.

                  (c)      Except as required by law, the parties shall hold,
and shall cause their respective officers, directors, employees, agents and
other representatives to hold, the existence, content and result of mediation or
arbitration in confidence in accordance with the provisions of Article VII and
except as may be required in order to enforce any award. Each of the parties
shall request that any mediator or arbitrator comply with such confidentiality
requirement.

                  (d)      In the event that at any time the sole arbitrator
shall fail to serve as an arbitrator for any reason, the parties shall select a
new arbitrator who shall be disinterested as to the parties and the matter in
accordance with the procedures set forth herein for the selection of the initial
arbitrator. The extent, if any, to which testimony previously given shall be
repeated or as to which the replacement arbitrator elects to rely on the
stenographic record (if there is one) of such testimony shall be determined by
the replacement arbitrator.

         7.8      CONTINUITY OF SERVICE AND PERFORMANCE. Unless otherwise agreed
in writing, the parties will continue to provide service and honor all other
commitments under this Agreement and each Ancillary Agreement during the course
of dispute resolution pursuant to the provisions of this Article VII with
respect to all matters not subject to such dispute, controversy or claim.

         7.9      LAW GOVERNING ARBITRATION PROCEDURES. The interpretation of
the provisions of this Article VII, only insofar as they relate to the agreement
to arbitrate and any procedures pursuant thereto, shall be governed by the
Federal Arbitration Act and other applicable federal law. In all other respects,
the interpretation of this Agreement shall be governed as set forth in Section
7.3.

                                  ARTICLE VIII

                           COVENANTS AND OTHER MATTERS

         8.1      OTHER AGREEMENTS. In addition to the specific agreements,
documents and instruments annexed to this Agreement, CenterPoint and Genco agree
to execute or cause to be executed by the appropriate parties and deliver, as
appropriate, such other agreements,

                                       25

<PAGE>

instruments and other documents as may be necessary or desirable in order to
effect the purposes of this Agreement and the Ancillary Agreements.

         8.2      AGREEMENT FOR EXCHANGE OF INFORMATION. Each of CenterPoint and
Genco agrees to provide, or cause to be provided, to each other as soon as
reasonably practicable after written request therefor, any Information in the
possession or under the control of such party that the requesting party
reasonably needs (i) to comply with reporting, disclosure, filing or other
requirements imposed on the requesting party (including under applicable
securities laws) by a Governmental Authority having jurisdiction over the
requesting party, (ii) for use in any Regulatory Proceeding, judicial proceeding
or other proceeding or in order to satisfy audit, accounting, claims,
regulatory, litigation or other similar requirements, (iii) to comply with its
obligations under this Agreement or any Ancillary Agreement or (iv) in
connection with the ongoing businesses of CenterPoint or Genco as it relates to
the conduct of such businesses, as the case may be; provided, however, that in
the event that any party determines that any such provision of Information could
be commercially detrimental, violate any law or agreement, or waive any
attorney-client privilege, the parties shall take all reasonable measures to
permit the compliance with such obligations in a manner that avoids any such
harm or consequence.

                  (a)      After the Genco Distribution Date, (i) each party
shall maintain in effect at its own cost and expense adequate systems and
controls for its business to the extent necessary to enable the other party to
satisfy its reporting, accounting, audit and other obligations, and (ii) each
party shall provide, or cause to be provided, to the other party and its
Subsidiaries in such form as such requesting party shall request, at no charge
to the requesting party, all financial and other data and information as the
requesting party determines necessary or advisable in order to prepare its
financial statements and reports or filings with any Governmental Authority.

                  (b)      Any Information owned by a party that is provided to
a requesting party pursuant to this Section 8.2 shall be deemed to remain the
property of the providing party. Unless specifically set forth herein, nothing
contained in this Agreement shall be construed as granting or conferring rights
of license or otherwise in any such Information.

                  (c)      To facilitate the exchange of Information pursuant to
this Section 8.2 and other provisions of this Agreement after the Genco
Distribution Date, each party agrees to use its reasonable commercial efforts to
retain all Information in its respective possession or control on the Genco
Distribution Date substantially in accordance with its policies as in effect on
the date hereof. Genco shall not amend its or its Subsidiaries' record retention
policies prior to the Genco Distribution Date without the consent of
CenterPoint. However, except as set forth in the Genco Tax Allocation Agreement,
at any time after the Genco Distribution Date, each party may amend its
respective record retention policies at its discretion; provided, however, that
if a party desires to effect the amendment within three years after the Genco
Distribution Date, the amending party must give 30 days' prior written notice of
such change in the policy to the other party to this Agreement. No party will
destroy, or permit any of its Subsidiaries to destroy, any Information that
existed on the Genco Separation Date (other than Information that is permitted
to be destroyed under the current record retention policy of such party) without
first using its reasonable commercial efforts to notify the other party of the
proposed destruction and giving the other party the opportunity to take
possession of such Information prior to such destruction.

                                       26

<PAGE>

                  (d)      No party shall have any liability to any other party
in the event that any Information exchanged or provided pursuant to this Section
8.2 is found to be inaccurate, in the absence of willful misconduct by the party
providing such Information. No party shall have any liability to any other party
if any Information is destroyed or lost after reasonable commercial efforts by
such party to comply with the provisions of Section 8.2(c).

                  (e)      The rights and obligations granted under this Section
8.2 are subject to any specific limitations, qualifications or additional
provisions on the sharing, exchange or confidential treatment of Information set
forth in this Agreement and any Ancillary Agreement.

                  (f)      Each party hereto shall, except in the case of a
dispute subject to this Article VIII brought by one party against another party
(which shall be governed by the discovery rules that may be applicable under
Article VII or otherwise), use its reasonable commercial efforts to make
available to each other party, upon written request, the former, current and
future directors, officers, employees, other personnel and agents of such party
as witnesses and any books, records or other documents within its control or
which it otherwise has the ability to make available, to the extent that any
such person (giving consideration to business demands of such directors,
officers, employees, other personnel and agents) or books, records or other
documents may reasonably be required in connection with any Regulatory
Proceeding, judicial proceeding or other proceeding in which the requesting
party may from time to time be involved, regardless of whether such Regulatory
Proceeding, judicial proceeding or other proceeding is a matter with respect to
which indemnification may be sought hereunder. The requesting party shall bear
all costs and expenses in connection therewith.

                  (g)      To the extent Genco or a member of the Genco Group is
deemed or determined by the PUCT by final order no longer subject to rehearing
by the PUCT to be an "affiliate" or a "competitive affiliate" of CenterPoint,
Genco and CenterPoint shall observe any applicable requirements of the Utilities
Code, PUCT rules and the CenterPoint code of conduct and shall require their
respective personnel and contractor personnel to observe that code of conduct.
No member of the CenterPoint Group or the Genco Group shall directly or
indirectly make application or request to the PUCT to make such a finding or
determination, nor will any member of the CenterPoint Group or the Genco Group
directly or indirectly take a position in support of such a finding or
determination.

         8.3      AUDITORS AND AUDITS; ANNUAL AND QUARTERLY STATEMENTS AND
ACCOUNTING. Each party agrees that, for so long as Genco remains a Subsidiary of
CenterPoint, and with respect to any financial reporting period during which
Genco was a Subsidiary of CenterPoint:

                  (a)      Genco shall not select a different accounting firm
than the firm selected by CenterPoint to audit its financial statements to serve
as the Genco Auditors for purposes of providing an opinion on its consolidated
financial statements without CenterPoint's prior written consent (which shall
not be unreasonably withheld).

                  (b)      Genco shall use its reasonable commercial efforts to
enable the Genco Auditors to complete their audit such that they will date their
opinion on Genco's audited annual financial statements on the same date that
CenterPoint's Auditors date their opinion on CenterPoint's audited annual
financial statements, and to enable CenterPoint to meet its

                                       27

<PAGE>

timetable for the printing, filing and public dissemination of CenterPoint's
annual financial statements. Genco shall use its reasonable commercial efforts
to enable the Genco Auditors to complete their quarterly review procedures such
that they will provide clearance on Genco's quarterly financial statements on
the same date that CenterPoint's Auditors provide clearance on CenterPoint's
quarterly financial statements.

                  (c)      Genco shall provide to CenterPoint on a timely basis
all Information that CenterPoint reasonably requires to meet its schedule for
the preparation, printing, filing, and public dissemination of CenterPoint's
annual and quarterly financial statements. Without limiting the generality of
the foregoing, Genco will provide all required financial information with
respect to Genco and its Subsidiaries to the Genco Auditors in a sufficient and
reasonable time and in sufficient detail to permit the Genco Auditors to take
all steps and perform all reviews necessary to provide sufficient assistance to
CenterPoint's Auditors with respect to Information to be included or contained
in CenterPoint's annual and quarterly financial statements. Similarly,
CenterPoint shall provide to Genco on a timely basis all Information that Genco
reasonably requires to meet its schedule for the preparation, printing, filing,
and public dissemination of Genco's annual and quarterly financial statements.
Without limiting the generality of the foregoing, CenterPoint will provide all
required financial Information with respect to CenterPoint and its Subsidiaries
to CenterPoint's Auditors in a sufficient and reasonable time and in sufficient
detail to permit CenterPoint's Auditors to take all steps and perform all
reviews necessary to provide sufficient assistance to the Genco Auditors with
respect to Information to be included or contained in Genco's annual and
quarterly financial statements.

                  (d)      Genco shall authorize the Genco Auditors to make
available to CenterPoint's Auditors both the personnel who performed or are
performing the annual audits and quarterly reviews of Genco and work papers
related to the annual audits and quarterly reviews of Genco, in all cases within
a reasonable time prior to the Genco Auditors' opinion date, so that
CenterPoint's Auditors are able to perform the procedures they consider
necessary to take responsibility for the work of the Genco Auditors as it
relates to CenterPoint's Auditors' report on CenterPoint's financial statements,
all within sufficient time to enable CenterPoint to meet its timetable for the
printing, filing and public dissemination of CenterPoint's annual and quarterly
statements. Similarly, CenterPoint shall authorize CenterPoint's Auditors to
make available to the Genco Auditors both the personnel who performed or are
performing the annual audits and quarterly reviews of CenterPoint and work
papers related to the annual audits and quarterly reviews of CenterPoint, in all
cases within a reasonable time prior to CenterPoint's Auditors' opinion date, so
that the Genco Auditors are able to perform the procedures they consider
necessary to take responsibility for the work of CenterPoint's Auditors as it
relates to the Genco Auditors' report on Genco's financial statements, all
within sufficient time to enable Genco to meet its timetable for the printing,
filing and public dissemination of Genco's annual and quarterly financial
statements.

                  (e)      Genco may not change its accounting principles or
practices if a change in such accounting principle or practice would be required
to be disclosed in Genco's financial statements as filed with the SEC or
otherwise publicly disclosed therein without the prior written consent of
CenterPoint, except for changes which are required by GAAP and as to which there
is no discretion on the part of Genco, as concurred in by Genco Auditors prior
to its implementation. Genco shall give CenterPoint as much prior notice as
reasonably practical of

                                       28

<PAGE>

any proposed determination of, or any significant changes in, its accounting
estimates or, subject as aforesaid, accounting principles from those in effect
on the Genco Separation Date. Genco will consult with CenterPoint and, if
requested by CenterPoint, Genco will consult with CenterPoint's Auditors with
respect thereto. CenterPoint shall give Genco as much prior notice as reasonably
practical of any proposed determination of, or any significant changes in, its
accounting estimates or accounting principles from those in effect on the Genco
Separation Date.

                  (f)      Nothing in Sections 8.2 and 8.3 shall require Genco
to violate any agreement with any third parties regarding the confidentiality of
confidential and proprietary information relating to that third party or its
business; provided, however, that in the event that Genco is required under
Section 8.2 or Section 8.3 to disclose any such information, Genco shall use all
commercially reasonable efforts to seek to obtain such third party's consent to
the disclosure of such information. Similarly, nothing in Sections 8.2 and 8.3
shall require CenterPoint to violate any agreement with any third parties
regarding the confidentiality of confidential and proprietary information
relating to that third party or its business; provided, however, that in the
event that CenterPoint is required under Section 8.2 or Section 8.3 to disclose
any such information, CenterPoint shall use all commercially reasonable efforts
to seek to obtain such third party's consent to the disclosure of such
information.

         8.4      AUDIT RIGHTS. To the extent any member of the CenterPoint
Group provides goods or services to any member of the Genco Group or any member
of the Genco Group provides goods or services to a member of the CenterPoint
Group under this Agreement or under any Ancillary Agreement, the company
providing such goods or services (the "Providing Company") shall maintain
complete and accurate books and records relating to costs and charges made to
the company receiving such goods and services (the "Receiving Company"). Books
and accounts shall be maintained in accordance with generally accepted
accounting principles, consistently applied, and to the extent such books and
records relate to regulated business activities, shall conform to any applicable
regulatory code of accounts which the Receiving Company is required to comply
with, to the extent such conformity is reasonably feasible. If conformity to a
regulatory code of accounts is infeasible, the Providing Company shall maintain
its books and records related to the provision of goods and services in such a
manner that the Receiving Company may readily reconcile such books and records
to the applicable code of accounts. Annually, the Receiving Company shall be
entitled to audit the Providing Company's books and records related to the goods
and services provided, using its own personnel or personnel from its independent
auditing firm. Discrepancies identified as a result of any audit shall be
promptly reconciled between the parties in accordance with any provisions of the
Ancillary Agreement or, if no such provision is applicable, in accordance with
the dispute resolution provisions of this Agreement. Any charge which is not
questioned by the Receiving Company within the calendar year after the charge
was rendered shall be deemed incontestable.

         8.5      PRESERVATION OF LEGAL PRIVILEGES. CenterPoint and Genco
recognize that the members of their respective Businesses possess and will
possess information and advice that has been previously developed but is legally
protected from disclosure under legal privileges, such as the attorney-client
privilege or work product exemption and other concepts of legal protection
("Privilege"). Each party recognizes that they shall be jointly entitled to the
Privilege with respect to such privileged information and that each shall be
entitled to maintain and use for its own benefit all such information and
advice, but both parties shall ensure that such information

                                       29

<PAGE>

is maintained so as to protect the Privileges with respect to the other party's
interest. To that end neither party will knowingly waive or compromise any
Privilege associated with such information and advice without the consent of the
other party. In the event that privileged information is required to be
disclosed to any arbitrator or mediator in connection with a dispute between the
parties, such disclosure shall not be deemed a waiver of Privilege with respect
to such information, and any party receiving it in connection with a proceeding
shall be informed of its nature and shall be required to safeguard and protect
it.

         8.6      PAYMENT OF EXPENSES. Except as otherwise provided in this
Agreement, the Ancillary Agreements or any other agreement between the parties,
all out-of-pocket costs and expenses of the parties hereto incurred in
connection with the preparation of this Agreement, the Ancillary Agreements, the
registration statement on Form 10 and related information statement and the
completion of the Genco Distribution shall be paid by CenterPoint.

         8.7      GOVERNMENTAL APPROVALS. The parties acknowledge that certain
of the transactions contemplated by this Agreement and the Ancillary Agreements
are subject to certain conditions established by applicable government
regulations, orders, and approvals ("Existing Authority"). The parties intend to
implement this Agreement, the Ancillary Agreements and the transactions
contemplated thereby consistent with and to the extent permitted by Existing
Authority and to cooperate toward obtaining and maintaining in effect such
Governmental Approvals as may be required in order to implement this Agreement
and each of the Ancillary Agreements as fully as possible in accordance with
their respective terms. To the extent that any of the transactions contemplated
by this Agreement or any Ancillary Agreement require any Governmental Approvals,
the parties will use their reasonable commercial efforts to obtain any such
Governmental Approvals.

         8.8      REGULATORY PROCEEDINGS. It is recognized and understood that
high levels of cooperation and assistance will be required between members of
the CenterPoint Group and the Genco Group in connection with Regulatory
Proceedings necessary to implement the Genco Distribution and the Business
Separation Plan approved by the PUCT and all matters relating to the Genco
Option. During the period from the Genco Separation Date until an order issued
by the PUCT in connection with the stranded cost determination regarding the
Genco Assets becomes final and nonappealable, the parties agree as follows:

                  (a)      Upon reasonable request, members of the CenterPoint
Group and of the Genco Group will provide personnel, information and other
assistance to members of the other Business in order to prepare, file and
prosecute to completion Regulatory Proceedings which are either (i) required to
be filed under the Utilities Code or under the Business Separation Plan or (ii)
deemed by the requesting party to be desirable to implement or preserve some
aspect of the Separation contemplated herein.

                  (b)      Assistance provided may, without limitation, relate
to information that has been transferred to or retained by the assisting party
in the separation or which the assisting party is uniquely qualified to provide
in connection with Regulatory Proceedings that relate to the Separation and its
implementation under the Utilities Code. Assistance may take the form of
developing, filing and giving testimony and reports to the PUCT or other
regulatory authority.

                                       30

<PAGE>

                  (c)      The appropriate members of the CenterPoint Group or
the Genco Group shall timely file with the PUCT or other regulatory authority or
court and shall prosecute to completion all Regulatory Proceedings required to
implement the Business Separation Plan approved by the PUCT, the Genco Option
and the other provisions of this Agreement.

                  (d)      A member of the CenterPoint Group shall make all
regulatory filings contemplated above in this Section 8.8 except where a member
of the Genco Group is required by the Utilities Code to file separately or join
in such filings. A member of the CenterPoint Group will be responsible for the
direction and prosecution of all Regulatory Proceedings in which CenterPoint
Group filings are made.

                  (e)      Except as provided below, the party supplying
assistance shall be reimbursed for costs incurred in providing assistance. For
time expended by its personnel, the assisting party shall be reimbursed for
actual salary costs, plus payroll burdens and overhead allocations in accordance
with its standard procedures for reimbursing other members of its Business.
Services provided for information technology or other internal services shall be
charged in the same manner they would be charged among the members of the
providing company's Business, and out of pocket costs paid to third parties
shall be reimbursed at actual cost.

The party requesting assistance shall endeavor to minimize the impacts of such
assistance on the other business needs of the assisting party.

         8.9      CONTINUANCE OF CENTERPOINT CREDIT SUPPORT; BORROWINGS.
Notwithstanding any other provision of this Agreement or the provisions of any
Ancillary Agreement to the contrary, the parties hereby agree that CenterPoint
and each Subsidiary of CenterPoint shall maintain in full force and effect each
guarantee, letter of credit, keepwell or support agreement or other credit
support document, instrument or other similar arrangement issued for the benefit
of any Person in the Genco Group by or on behalf of CenterPoint or a Subsidiary
of CenterPoint (the "Credit Support Arrangements") which is outstanding as of
the Genco Distribution Date, until the earlier of (a) such time as such Credit
Support Arrangement terminates in accordance with its terms or is otherwise
released at the request of Genco or (b) the date Genco ceases to be a Subsidiary
of CenterPoint; provided, that Genco shall use commercially reasonable efforts,
at the request of CenterPoint, to attempt to release or replace any Credit
Support Arrangement for which such replacement or release is reasonably
available. All such obligations shall be deemed Genco Liabilities. For so long
as CenterPoint or any Subsidiary of CenterPoint remains liable with respect to
any such Credit Support Arrangement, (1) Genco shall pay, or cause the Person in
the Genco Group for whose benefit the Credit Support Arrangement is provided to
pay, the underlying obligation as and when the same shall become due and
payable, to the end that neither CenterPoint nor such Subsidiary of CenterPoint
shall be required to make any payment under or by reason of its obligation under
such Credit Support Arrangement and (2) CenterPoint or such Subsidiary shall
retain all rights of reimbursement and subrogation it may have, whether arising
by law, by contract or otherwise, with respect to such Credit Support
Arrangement and such rights shall be enforceable against Genco as well as the
Subsidiary of Genco for whose benefit the Credit Support Arrangement was made.
Members of the CenterPoint Group may advance funds to or borrow funds from
members of the Genco Group from time to time at

                                       31

<PAGE>

market-based rates; provided, however, that except as provided in the Genco
Option Agreement, no member of the CenterPoint Group or the Genco Group shall
have any obligation to do so.

         To the extent covenants and agreements contained in any loan or credit
agreement or other financing document in effect on the date of this Agreement to
which any member of the CenterPoint Group is a party requires, or requires such
party to cause, any member of the Genco Group to take or refrain from taking any
action, or provides for a default or event of default if any member of the Genco
Group takes or refrains from taking any action, such member of the Genco Group
shall at all times prior to the Genco Distribution Date take or refrain from
taking any such action as would result in a breach or violation of, or a default
under, such agreement.

         8.10     [RESERVED SECTION]. [Reserved.]

         8.11     CONFIDENTIALITY.

                  (a)      CenterPoint and Genco shall hold and shall cause the
members of the CenterPoint Group and the Genco Group, respectively, to hold, and
shall each cause their respective officers, employees, agents, consultants and
advisors to hold, in strict confidence and not to disclose or release without
the prior written consent of the other party, any and all Confidential
Information (as defined herein); provided, that the parties may disclose, or may
permit disclosure of, Confidential Information (i) to their respective auditors,
attorneys, financial advisors, bankers and other appropriate consultants and
advisors who have a need to know such information and are informed of their
obligation to hold such information confidential to the same extent as is
applicable to the parties hereto and in respect of whose failure to comply with
such obligations, CenterPoint or Genco, as the case may be, will be responsible
or (ii) to the extent any member of the CenterPoint Group or the Genco Group is
compelled to disclose any such Confidential Information by judicial or
administrative process or, in the opinion of legal counsel, by other
requirements of law. Notwithstanding the foregoing, in the event that any demand
or request for disclosure of Confidential Information is made pursuant to clause
(ii) above, CenterPoint or Genco, as the case may be, shall promptly notify the
other of the existence of such request or demand and shall provide the other a
reasonable opportunity to seek an appropriate protective order or other remedy,
which both parties will cooperate in seeking to obtain. In the event that such
appropriate protective order or other remedy is not obtained, the party whose
Confidential Information is required to be disclosed shall or shall cause the
other party to furnish, or cause to be furnished, only that portion of the
Confidential Information that is legally required to be disclosed. As used in
this Section 8.11, "Confidential Information" shall mean all proprietary,
technical or operational information, data or material of one party which, prior
to or following the Genco Distribution Date, has been disclosed by CenterPoint
or members of the CenterPoint Group, on the one hand, or Genco or members of the
Genco Group, on the other hand, in written, oral (including by recording),
electronic, or visual form to, or otherwise has come into the possession of, the
other, including pursuant to the access provisions of Section 8.2 hereof or any
other provision of this Agreement (except to the extent that such Information
can be shown to have been (a) in the public domain through no fault of such
party (or, in the case of CenterPoint, any other member of the CenterPoint Group
or, in the case of Genco, any other member of the Genco Group) or (b) later
lawfully acquired from other sources by the party (or, in the case of
CenterPoint, such member of the CenterPoint Group or, in the case of Genco, such

                                       32

<PAGE>

member of the Genco Group) to which it was furnished; provided, however, in the
case of (b) that such sources did not provide such Information in breach of any
confidentiality obligations).

                  (b)      Notwithstanding anything to the contrary set forth
herein, (i) CenterPoint and the other members of the CenterPoint Group, on the
one hand, and Genco and the other members of the Genco Group, on the other hand,
shall be deemed to have satisfied their obligations hereunder with respect to
Confidential Information if they exercise the same degree of care (but no less
than a reasonable degree of care) as they take to preserve confidentiality for
their own similar Information and (ii) confidentiality obligations provided for
in any agreement between CenterPoint or any other member of the CenterPoint
Group, or Genco or any other members of the Genco Group, on the one hand, and
any employee of CenterPoint or any other member of the CenterPoint Group, or
Genco or any other members of the Genco Group, on the other hand, shall remain
in full force and effect. Confidential Information of CenterPoint or any other
member of the CenterPoint Group, on the one hand, or Genco or any other member
of the Genco Group, on the other hand, in the possession of and used by the
other as of the Genco Distribution Date may continue to be used by such Person
in possession of the Confidential Information in and only in the operation of
the CenterPoint Group or the Genco Group, as the case may be, and may be used
only so long as the Confidential Information is maintained in confidence and not
disclosed in violation of Section 8.11(a). Such continued right to use may not
be transferred to any third party unless the third party purchases all or
substantially all of the business and assets in which the relevant Confidential
Information is used or employed in one transaction or in a series or related
transactions. In the event that such right to use is transferred in accordance
with the preceding sentence, the transferring party shall not disclose the
source of the relevant Confidential Information.

         8.12     CAPACITY AUCTIONS. Genco shall cause Genco LP to auction its
capacity in accordance with the terms of Section 10.14 of the Master Separation
Agreement.

         8.13     NUCLEAR DECOMMISSIONING TRUST AND INVESTMENT. Genco shall
comply with the applicable terms of Section 10.13 of the Master Separation
Agreement.

                                   ARTICLE IX

                                  MISCELLANEOUS

         9.1      LIMITATION OF LIABILITY. EXCEPT TO THE EXTENT SPECIFICALLY
PROVIDED IN ANY ANCILLARY AGREEMENT, IN NO EVENT SHALL ANY MEMBER OF THE
CENTERPOINT GROUP OR THE GENCO GROUP OR THEIR RESPECTIVE DIRECTORS, OFFICERS OR
EMPLOYEES BE LIABLE TO ANY OTHER MEMBER OF THE CENTERPOINT GROUP OR THE GENCO
GROUP FOR ANY SPECIAL, CONSEQUENTIAL, INDIRECT, INCIDENTAL OR PUNITIVE DAMAGES
OR LOST PROFITS, HOWEVER CAUSED AND ON ANY THEORY OF LIABILITY (INCLUDING
NEGLIGENCE) ARISING IN ANY WAY OUT OF THIS AGREEMENT, WHETHER OR NOT SUCH PARTY
HAS BEEN ADVISED OF THE POSSIBILITY OF SUCH DAMAGES; PROVIDED, HOWEVER, THAT THE
FOREGOING LIMITATIONS SHALL NOT LIMIT EACH PARTY'S INDEMNIFICATION OBLIGATIONS
FOR LIABILITIES TO THIRD PARTIES AS SET FORTH IN THIS AGREEMENT OR ANY ANCILLARY
AGREEMENT.

                                       33

<PAGE>

         9.2      ENTIRE AGREEMENT. This Agreement, the other Ancillary
Agreements and the Exhibits and Schedules referred to or attached hereto and
thereto, constitute the entire agreement between the parties with respect to the
subject matter hereof and shall supersede all prior written and oral and all
contemporaneous oral agreements and understandings with respect to the subject
matter hereof.

         9.3      GOVERNING LAW. This Agreement shall be governed and construed
and enforced in accordance with the laws of the State of Texas as to all matters
regardless of the laws that might otherwise govern under the principles of
conflicts of laws applicable thereto.

         9.4      TERMINATION. This Agreement and all Ancillary Agreements may
be terminated at any time prior to the Genco Distribution Date by and in the
sole discretion of CenterPoint without the approval of Genco. This Agreement may
be terminated at any time after the Genco Distribution Date by mutual consent of
CenterPoint and Genco. In the event of termination pursuant to this Section 9.4,
neither party shall have any liability of any kind to the other party.

         9.5      NOTICES. Unless expressly provided herein, all notices,
claims, certificates, requests, demands and other communications hereunder shall
be in writing and shall be deemed to be duly given (i) when personally delivered
or (ii) if mailed registered or certified mail, postage prepaid, return receipt
requested, on the date the return receipt is executed or the letter refused by
the addressee or its agent or (iii) if sent by overnight courier which delivers
only upon the signed receipt of the addressee, on the date the receipt
acknowledgment is executed or refused by the addressee or its agent or (iv) if
sent by facsimile or other generally accepted means of electronic transmission,
on the date confirmation of transmission is received (provided that a copy of
any notice delivered pursuant to this clause (iv) shall also be sent pursuant to
clause (ii) or (iii)), addressed to the attention of the addressee's General
Counsel at the address of its principal executive office or to such other
address or facsimile number for a party as it shall have specified by like
notice.

         9.6      COUNTERPARTS. This Agreement, including the Schedules and
Exhibits hereto and the other documents referred to herein, may be executed in
counterparts, each of which shall be deemed to be an original but all of which
shall constitute one and the same agreement.

         9.7      BINDING EFFECT; ASSIGNMENT. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective legal
representatives and successors, and nothing in this Agreement, express or
implied, is intended to confer upon any other Person any rights or remedies of
any nature whatsoever under or by reason of this Agreement. This Agreement may
not be assigned by any party hereto without the prior written consent of the
other party hereto.

         9.8      SEVERABILITY. If any term or other provision of this Agreement
or the Schedules or Exhibits attached hereto is determined by a nonappealable
decision by a court, administrative agency or arbitrator to be invalid, illegal
or incapable of being enforced by any rule of law or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to either
party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties

                                       34

<PAGE>

hereto shall negotiate in good faith to modify this Agreement so as to effect
the original intent of the parties as closely as possible in an acceptable
manner to the end that the transactions contemplated hereby are fulfilled to the
fullest extent possible.

         9.9      FAILURE OR INDULGENCE NOT WAIVER; REMEDIES CUMULATIVE. No
failure or delay on the part of either party hereto in the exercise of any right
hereunder shall impair that right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor shall any single or partial exercise of any such right preclude other or
further exercise thereof or of any other right. All rights and remedies existing
under this Agreement or the Schedules or Exhibits attached hereto are cumulative
to, and not exclusive of, any rights or remedies otherwise available.

         9.10     AMENDMENT. No change or amendment will be made to this
Agreement except by an instrument in writing signed on behalf of each of the
parties to this Agreement.

         9.11     AUTHORITY. Each of the parties hereto represents to the other
that (a) it has the corporate or other requisite power and authority to execute,
deliver and perform this Agreement and the Ancillary Agreements, (b) the
execution, delivery and performance of this Agreement and the Ancillary
Agreements by it have been duly authorized by all necessary corporate or other
actions, (c) it has duly and validly executed and delivered this Agreement and
the Ancillary Agreements and (d) this Agreement and the Ancillary Agreements are
legal, valid and binding obligations, enforceable against it in accordance with
their respective terms subject to applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally and general equity principles.

         9.12     INTERPRETATION. The headings contained in this Agreement, in
any Exhibit or Schedule hereto and in the table of contents to this Agreement
are for reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement. Any capitalized term used in any Schedule or
Exhibit but not otherwise defined therein shall have the meaning assigned to
that term in this Agreement. When a reference is made in this Agreement to an
Article or a Section, Exhibit or Schedule, that reference shall be to an Article
or Section of, or an Exhibit or Schedule to, this Agreement unless otherwise
indicated.

         9.13     CONFLICTING AGREEMENTS. In the event of conflict between this
Agreement and any Ancillary Agreement or other agreement executed in connection
herewith, the provisions of that other agreement shall prevail.

                                       35

<PAGE>

         WHEREFORE, the parties have signed this Separation Agreement effective
as of the date first set forth above.

                                     CENTERPOINT ENERGY, INC.

                                     By:  /s/ DAVID M. MCCLANAHAN
                                          -------------------------------------
                                          David M. McClanahan
                                          President and Chief Executive Officer

                                     TEXAS GENCO HOLDINGS, INC.

                                     By:  /s/ DAVID G. TEES
                                          -------------------------------------
                                          David G. Tees
                                          President and Chief Executive Officer

                                       36

<PAGE>

                                                                   SCHEDULE 1.27

                            Genco Group Subsidiaries

<TABLE>
<CAPTION>
       Name                 Form of Entity           Jurisdiction of Formation
       ----                 --------------           -------------------------
<S>                    <C>                           <C>
Texas Genco GP, LLC    Limited Liability Company              Texas

Texas Genco LP, LLC    Limited Liability Company              Delaware

Texas Genco, LP        Limited Partnership                    Texas
</TABLE>

<PAGE>

                                                                 SCHEDULE 4.1(a)

                 Amended and Restated Articles of Incorporation

<PAGE>

                                                                 SCHEDULE 4.1(b)

                           Amended and Restated Bylaws

<PAGE>

                                                                 SCHEDULE 4.1(c)

                           Board of Directors of Genco

David M. McClanahan
David G. Tees<PAGE>

                                                               EXHIBIT 10(cc)(2)

                          TRANSITION SERVICES AGREEMENT

                                     between

                            CENTERPOINT ENERGY, INC.

                                       and

                           TEXAS GENCO HOLDINGS, INC.

<PAGE>

                          TRANSITION SERVICES AGREEMENT

                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                      Page
                                                                                                      ----
<S>                                                                                                   <C>
ARTICLE I DEFINITIONS...............................................................................    1
         1.1          Additional Services...........................................................    1
         1.2          Ancillary Agreements..........................................................    1
         1.3          CenterPoint Group.............................................................    1
         1.4          Corporate Center Services.....................................................    1
         1.5          Genco Distribution............................................................    1
         1.6          Genco Distribution Date.......................................................    1
         1.7          Genco Separation Agreement....................................................    2
         1.8          Genco Group...................................................................    2
         1.9          Group.........................................................................    2
         1.10         Impracticable.................................................................    2
         1.11         Information Technology Services...............................................    2
         1.12         Initial Services..............................................................    2
         1.13         Liability.....................................................................    2
         1.14         Providing Company.............................................................    2
         1.15         Receiving Company.............................................................    2
         1.16         Representative................................................................    2
         1.17         Services......................................................................    2
         1.18         Shared Services...............................................................    2
         1.19         Subsidiary....................................................................    2
         1.20         System........................................................................    2

ARTICLE II SERVICES.................................................................................    3
         2.1          Services......................................................................    3
         2.2          Subsidiaries; Services Performed by Others....................................    4
         2.3          Charges and Payment...........................................................    5
         2.4          General Obligations; Standard of Care.........................................    8
         2.5          Certain Limitations...........................................................   10
         2.6          Confidentiality...............................................................   10
         2.7          Term; Early Termination.......................................................   11
         2.8          Disclaimer of Warranties, Limitation of Liability and Indemnification.........   12
         2.9          Representatives...............................................................   13
         2.10         Employee Matters..............................................................   13

ARTICLE III MISCELLANEOUS...........................................................................   13
         3.1          Taxes.........................................................................   13
         3.2          Laws and Governmental Regulations.............................................   14
         3.3          Relationship of Parties.......................................................   14
         3.4          References....................................................................   14
         3.5          Modification and Amendment....................................................   14
</TABLE>

                                       -i-

<PAGE>

<TABLE>
<S>                                                                                                   <C>
         3.6          Inconsistency.................................................................   14
         3.7          Resolution of Disputes........................................................   15
         3.8          Successors and Assignment.....................................................   15
         3.9          Notices.......................................................................   15
         3.10         Governing Law.................................................................   15
         3.11         Severability..................................................................   15
         3.12         Counterparts..................................................................   15
         3.13         Rights of the Parties.........................................................   15
         3.14         Reservation of Rights.........................................................   15
         3.15         Entire Agreement..............................................................   16
</TABLE>

                                      -ii-

<PAGE>

                          TRANSITION SERVICES AGREEMENT

                  THIS TRANSITION SERVICES AGREEMENT, entered into effective as
of August 31, 2002 (the "Effective Date"), is between CenterPoint Energy, Inc.,
a Texas corporation ("CenterPoint"), and Texas Genco Holdings, Inc., a Texas
corporation ("Genco"). Capitalized terms used herein and not otherwise defined
shall have the respective meanings assigned to them in Article I hereof or
assigned to them in the Genco Separation Agreement (as defined below).

                  WHEREAS, Genco is an indirect, wholly owned Subsidiary of
CenterPoint; and

                  WHEREAS, the parties have entered into a Separation Agreement
of even date herewith (the "Genco Separation Agreement") pursuant to which,
among other things, approximately 19% of the shares of Genco common stock owned
by CenterPoint will be distributed to the shareholders of CenterPoint (the
"Genco Distribution"); and

                  WHEREAS, the parties agree that it will be necessary and
desirable for CenterPoint to provide to Genco the "Services" described herein
for a transitional period following the Genco Distribution.

                  NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements herein contained, the parties, intending to be
legally bound, agree as follows:

                                   ARTICLE I
                                  DEFINITIONS

                  For the purpose of this Agreement the following terms shall
have the following meanings:

                  1.1      ADDITIONAL SERVICES. "Additional Services" shall have
the meaning set forth in subsection 2.1(c).

                  1.2      ANCILLARY AGREEMENTS. "Ancillary Agreements" has the
meaning assigned to that term in the Genco Separation Agreement.

                  1.3      CENTERPOINT GROUP. "CenterPoint Group" shall mean
CenterPoint and its Subsidiaries excluding Genco and other members of the Genco
Group.

                  1.4      CORPORATE CENTER SERVICES. "Corporate Center
Services" shall mean the Services described in Exhibit 2.1(a)(i).

                  1.5      GENCO DISTRIBUTION. "Genco Distribution" has the
meaning set forth in the recitals hereto.

                  1.6      GENCO DISTRIBUTION DATE. "Genco Distribution Date"
has the meaning assigned to that term in the Genco Separation Agreement.

                                        1

<PAGE>

                  1.7      GENCO SEPARATION AGREEMENT. "Genco Separation
Agreement" has the meaning set forth in the recitals hereto.

                  1.8      GENCO GROUP. "Genco Group" shall mean Genco and its
Subsidiaries.

                  1.9      GROUP. "Group" shall mean either of the CenterPoint
Group or the Genco Group, as the context requires.

                  1.10     IMPRACTICABLE. "Impracticable" (and words of similar
import) shall have the meaning set forth in Section 2.5(b).

                  1.11     INFORMATION TECHNOLOGY SERVICES. "Information
Technology Services" shall mean the Services described in Exhibit 2.1(a)(ii).

                  1.12     INITIAL SERVICES. "Initial Services" shall have the
meaning set forth in Section 2.1(a).

                  1.13     LIABILITY. "Liability" has the meaning assigned to
that term in the Genco Separation Agreement.

                  1.14     PROVIDING COMPANY. "Providing Company" shall mean,
with respect to any particular Service, CenterPoint, or if a CenterPoint
Subsidiary is identified on the applicable Exhibit as the party to provide such
Service, such CenterPoint Subsidiary.

                  1.15     RECEIVING COMPANY. "Receiving Company" shall mean,
with respect to any particular Service, Genco or such Genco Subsidiary or Genco
Subsidiaries as may be identified on the applicable Exhibit as the party to
receive such Service or as Genco may hereafter designate to receive such
Service.

                  1.16     REPRESENTATIVE. "Representative" of any party shall
mean a managerial level employee appointed by such party to have the
responsibilities and authority set forth in Section 2.9.

                  1.17     SERVICES. "Services" shall have the meaning set forth
in Section 2.1(c).

                  1.18     SHARED SERVICES. "Shared Services" shall mean the
Services described in Exhibit 2.1(a)(iii).

                  1.19     SUBSIDIARY. "Subsidiary" shall mean, with respect to
CenterPoint or Genco, a corporation, partnership, limited partnership, limited
liability company or other entity more than 50% of the voting common stock or
other interests entitled to vote generally for the election of directors (or
comparable governing body) is owned, directly or indirectly, by CenterPoint or
Genco, respectively.

                  1.20     SYSTEM. "System" shall mean the software, hardware,
data store or maintenance and support components or portions of such components
of a set of information technology assets identified in Exhibit 2.1(a)(ii)
hereto.

                                        2

<PAGE>

                                   ARTICLE II
                                    SERVICES

                  2.1      SERVICES.

                  (a)      INITIAL SERVICES. Except as otherwise provided
herein, during the applicable term determined pursuant to Section 2.7 hereof,
the following "Initial Services" shall be provided by CenterPoint or other
Providing Company with respect to a Service to Genco or other Receiving Company
with respect to a Service:

                  (i)      Corporate Center Services;

                  (ii)     Information Technology Services; and

                  (iii)    Shared Services.

                  (b)      FINAL EXHIBITS. The parties have made good faith
efforts as of the date hereof to identify each Initial Service and complete the
content of each Exhibit pertaining to the Initial Services. To the extent an
Exhibit has not been prepared for an Initial Service or an Exhibit is otherwise
incomplete as of the date hereof, the parties shall use good faith efforts to
prepare or complete Exhibits by the Genco Distribution Date. Any Services
reflected on any such additional or amended Exhibit shall be deemed an "Initial
Service" as if set forth on such Exhibit as of the date hereof.

                  (c)      ADDITIONAL SERVICES.

                  (i)      From time to time after the Genco Distribution Date,
         the parties may identify additional services that one party will
         provide to the other party in accordance with the terms of this
         Agreement (the "Additional Services" and, together with the Initial
         Services, the "Services"). The parties shall create an Exhibit for each
         Additional Service setting forth a description of the Service, the time
         period during which the Service will be provided, the charge for the
         Service and any other terms applicable thereto and obtain the approval
         of each party's Representative. Except as set forth in Section
         2.1(c)(ii), the parties may, but shall not be required to, agree on
         Additional Services during the term of this Agreement.

                  (ii)     Except as set forth in the next sentence, the
         Providing Company shall be obligated to perform, at charges established
         pursuant to Section 2.3, any Additional Service that: (A) was provided
         by the Providing Company immediately prior to the Genco Distribution
         Date and that the Receiving Company reasonably believes was
         inadvertently or unintentionally omitted from the list of Initial
         Services or (B) is essential to effectuate an orderly transition of
         Genco to an independently managed, public company following the Genco
         Distribution, unless in either case such performance would
         significantly disrupt the Providing Company's operations or materially
         increase the scope of its responsibility under this Agreement. If the
         Providing Company reasonably believes the performance of Additional
         Services required under the foregoing clauses (A) or (B) would
         significantly disrupt its operations or materially increase the scope
         of its responsibility under this Agreement, the Providing Company and
         the Receiving

                                        3

<PAGE>

         Company shall negotiate in good faith to establish terms under which
         the Providing Company can provide such Additional Services, but the
         Providing Company shall not be obligated to provide such Additional
         Services if, following good faith negotiation, the Providing Company
         and the Receiving Company are unable to reach agreement on such terms.

                  (d)      SCALED UP OR MODIFIED SERVICES. If Genco requests the
level at which any Service is to be provided to be scaled up to a level in
excess of the level in effect on the Genco Distribution Date (or, in the case of
Corporate Center Services, such levels as may reasonably be expected to result
taking into account the status of Genco as a separate public company), or a
modification to any Service, Genco shall give CenterPoint such advance notice as
it may reasonably require sufficient to enable CenterPoint to make any necessary
preparations to perform such Services on the scaled-up or modified basis, and to
develop changes in the cost-based rates for those services as described in
Section 2.3(d). For purposes of this Section, the level of a Service shall be
considered to be "scaled up" if providing the service at the proposed level
involves an increase in personnel, equipment or other resources that is not, in
the opinion of the Providing Company, de minimis and is not reasonably embraced
by the agreed definition and scope of that Service prior to the proposed
increase.

                  2.2      SUBSIDIARIES; SERVICES PERFORMED BY OTHERS. At its
option, a Providing Company may cause any Service it is required to provide
hereunder to be provided by any other Person that is providing, or may from time
to time provide, the same or similar services for the Providing Company. Unless
otherwise specified herein or on an Exhibit hereto, the Providing Company shall
remain responsible, in accordance with the terms of this Agreement, for
performance of any Service it causes to be so provided. A Receiving Company may
direct that any Service required to be provided hereunder be provided for the
benefit of another member of the Group of which the Receiving Company is a
member, but unless specified herein or on an Exhibit hereto, the Receiving
Company shall be responsible for the payment of charges and other performance
required of the Receiving Company with respect to such Service.

                  To the extent CenterPoint personnel who traditionally have
provided services contemplated by this Agreement are transferred to a similar
position with Genco or a member of the Genco Group, such personnel shall
continue to provide services to Genco and, until the Genco Distribution Date,
will provide such services to CenterPoint to the extent CenterPoint requests. To
the extent such transferred personnel provide services to Genco, CenterPoint
shall be relieved of its obligations to provide such services to Genco under
this Agreement.

                  If CenterPoint personnel necessary to provide services under
this Agreement are transferred to Genco before the Genco Distribution Date and
CenterPoint is thereby rendered unable to continue to provide such services as
contemplated by this Agreement, CenterPoint shall be excused from its
obligations to provide such services, except to the extent either (i) such
services can reasonably be provided from personnel remaining with CenterPoint
without an increase in costs to CenterPoint that are not subject to
reimbursement under this Agreement or (ii) such services are treated as
Additional Services.

                  Services that Genco provides to CenterPoint prior to the Genco
Distribution Date shall be treated as though Genco is the Providing Company and
CenterPoint is the Receiving

                                        4

<PAGE>

Company under this Agreement. CenterPoint shall compensate Genco for such
services in the same manner as Genco compensates CenterPoint for similar
services, and the risk allocation to Genco for such services shall be the same
as the risk allocation to CenterPoint for the services.

                  2.3      CHARGES AND PAYMENT.

                  (a)      GENERAL PRINCIPLES RELATING TO CHARGES FOR SERVICES.
Subject to the specific terms of this Agreement, the Services will be charged
and paid for on the same general basis as has been heretofore in effect, with
the intent that such charges shall approximate the fully allocated direct and
indirect costs of providing the services, including reimbursement of
out-of-pocket third party costs and expenses, but without any element of profit
except to the extent routinely included as a component of traditional utility
cost of capital. It is the further intent of the parties that the fully
allocated direct and indirect costs incurred by CenterPoint and its Subsidiaries
in providing Services under this Agreement and similar services to other
entities within the CenterPoint Group will be charged for on a basis that
allocates such costs charged on a fair, nondiscriminatory basis. The parties
shall use good faith efforts to discuss any situation in which the actual charge
for a Service is reasonably expected to exceed the estimated charge, if any, set
forth on an Exhibit for a particular Service, provided, however, that charges
incurred in excess of any such estimate shall not justify stopping the provision
of, or payment for, Services under this Agreement.

                  (i)      Special Provisions for Corporate Center Services. In
         the case of Corporate Center Services, the costs of Services included
         in Exhibit 2.1(a)(i) will be direct billed on the basis of the fully
         allocated direct and indirect costs of providing those Services
         determined under the principles set forth in Section 2.3(a) where
         practicable. The costs of all other Corporate Center Services will be
         gathered in a common cost pool with similar services provided to other
         members of the CenterPoint Group and allocated to Genco and to other
         members of the CenterPoint Group pursuant to the existing methodology
         derived from the 1999 corporate cost allocation study conducted for
         Reliant Energy, Incorporated by DMG Maximus. As is the case under the
         current methodology, when there is a significant increase or decrease
         in one or more components of the cost of providing a Service, or when a
         category of Services is terminated as provided in Section 2.7, an
         adjustment to the allocation will be made by CenterPoint to reflect
         such changes. Out-of-pocket costs and expenses will also be included in
         the charges as provided in this Section 2.3(a).

                  (ii)     Special Provisions for Information Technology
         Services. In the case of Information Technology Services, Services will
         be charged initially based on the rates and usage formulas set forth in
         Exhibit 2.1(a)(ii) and shall be adjusted from time to time thereafter.
         The rates and formulas in effect at the Genco Distribution Date will
         continue in effect until December 31, 2003, unless adjustments prior to
         that date are required as specified in Section 2.3(b). Out-of-pocket
         costs and expenses will also be included in the charges as provided in
         this Section 2.3(a). Subsequent to December 31, 2003, components of
         rates attributable to equipment usage will be adjusted to reflect
         compensation for depreciation and return on capital investment.

                                        5

<PAGE>

                  In the case of any Services associated with facilitating the
         transition to an independent information technology infrastructure for
         Genco (as distinguished from the continuation of services of the nature
         heretofore provided) the scope and pricing of which has not been
         defined as of the Genco Distribution Date, the rates therefor will be
         determined by CenterPoint on the basis of the same cost-based
         methodology underlying the pricing of other Services provided under
         this Agreement. CenterPoint and Genco will use their respective
         commercially reasonable efforts to minimize incremental costs of
         effecting a transition to an independent information technology
         infrastructure for Genco.

                  It is understood that, except as otherwise provided herein or
         agreed in writing, the cost of buying new hardware or obtaining new
         software licenses specifically for the benefit of Genco shall be the
         responsibility of Genco.

                  It is understood that CenterPoint's commitment to deliver the
         level of service specified herein (including any Exhibits hereto) is
         contingent upon adherence by Genco to CenterPoint's process and
         technology standards as currently in effect and as subsequently
         modified and communicated to Genco.

                  It is understood that CenterPoint is responsible for
         protecting the performance levels and security of existing systems and
         information technology infrastructure. Accordingly, Genco agrees to
         review all modifications to any existing system currently running on
         CenterPoint's infrastructure and to obtain CenterPoint's approval,
         which shall not be unreasonably withheld, for such modifications.
         Similarly, Genco will review all new systems to be run on CenterPoint's
         infrastructure, or which connect with it, and will obtain CenterPoint's
         approval, which shall not be unreasonably withheld or delayed, before
         such systems are put in development or production.

                  It is understood that the rates provided for herein are based
         on a continuation of CenterPoint's centralized information technology
         infrastructure and organization. If Genco requests changes to any
         Services provided that require the segmentation of CenterPoint's
         information technology infrastructure into multiple or independent
         units, CenterPoint shall have the right to elect whether or not to
         provide Services on such changed basis, including the right to
         establish the economic terms on which it is willing to provide such
         Services.

                  (iii)    Special Provisions for Shared Services. In the case
         of Shared Services, the Services will be charged initially based on the
         rates and usage formulas set forth in the applicable Service Level
         Agreements covering services referenced in Exhibit 2.1(a)(iii) and
         shall be adjusted from time to time thereafter, as provided herein. The
         rates and formulas in effect at the Genco Distribution Date will
         continue in effect until December 31, 2003, unless adjustments prior to
         that date are required as specified in Section 2.3(b). Out-of-pocket
         costs and expenses will also be included in the charges as provided in
         this Section 2.3(a).

                  (b)      ECONOMIC REOPENER. If, in the case of any Services,
events or circumstances arise which, in the opinion of the Providing Company,
render the costs of providing such Services as determined under the principles
set forth in Section 2.3(a) materially

                                        6

<PAGE>

different from those being charged under a specific rate or formula then in
effect, the specific rate or formulas shall be equitably adjusted to take into
account such events or changed circumstances and bring them into line with the
general principles set forth in Section 2.3(a). Rates for a Service will also be
adjusted on a pro rata basis whenever the cost of providing the Service
increases by reason of the necessity to renegotiate a software license or obtain
a new license as a result of the change in the relationship between the
Providing Company and the entity to whom the Service is provided.

                  (c)      ANNUAL ADJUSTMENTS. Specific rates and formulas for
Services provided hereunder shall be subject to adjustment as of January 1 in
each year commencing January 1, 2004 to bring the rates and formulas into
conformity with the general principles referred to in Section 2.3(a), based on
estimated fixed and variable costs and budgeted usage levels for the year
commencing on such January 1.

                  (d)      SCALED UP OR MODIFIED SERVICES. If Genco requests the
scaling up or modifications of services under Section 2.1(d), CenterPoint shall
determine appropriate changes in the charges for such scaled up or modified
services in accordance with the general principles set forth in Section 2.3(a)
and shall give notice thereof to Genco. CenterPoint shall not be required to
incur costs or obligations or otherwise commit time and resources in preparation
for providing such Services on the scaled up or modified basis (except to the
extent necessary to make such determination of appropriate changes in the
charges to be made) unless and until Genco gives CenterPoint notice that it will
accept the charges for such services determined by CenterPoint in accordance
with this Section 2.3(d). If the scaling up of Services requires the hiring of
additional employees by CenterPoint or its Subsidiaries or the procurement of
additional equipment or services (other than equipment or services the full cost
of which is paid or reimbursed by Genco on a current basis), CenterPoint may
include in the charges for the scaled up services provisions for recovery
(either as part of the periodic rate or as payments due upon termination of the
Services) of (a) employee severance expenses and (b) the cost of equipment and
systems that CenterPoint cannot otherwise recover following termination of the
Services, in each case to the extent attributable to the scaled-up service
levels. In case any scaling up or modification of services requires the
incurrence of costs to implement such modification or scaling up (for example,
an SAP change or payroll configuration), CenterPoint may charge Genco for such
costs on an "up front" basis, in addition to any adjustments in periodic rates
occasioned by such scaling up or modification.

                  (e)      CHARGES FOR ADDITIONAL SERVICES. The Receiving
Company shall pay the Providing Company the charges, if any, set forth on each
Exhibit hereafter created for each of the Additional Services listed therein.
Charges, if any, for other Additional Services, including those required by
Section 2.1(c)(ii), shall be determined according to methods in use prior to the
Genco Distribution Date or such other method as may be mutually agreed that
ensures that the Providing Company recovers costs and expenses, but without any
profit except to the extent routinely included as a component of traditional
utility cost of capital, in accordance with subsection 2.3(a). Notwithstanding
the foregoing, however, the agreement of a party to provide or receive any
Additional Service that is not required pursuant to Section 2.1(c)(ii) at any
given rate or charge shall be at the sole discretion of such party.

                                        7

<PAGE>

                  (f)      PAYMENT TERMS. Charges and collections for Services
rendered pursuant to this Agreement shall continue to be made using the SAP
functionality in use as of the date of this Agreement unless and until either
party elects to discontinue such procedures, in which case the Providing Company
shall thereafter bill the Receiving Company monthly for all charges pursuant to
this Agreement and the Receiving Company shall pay the Providing Company for all
Services within 30 days after receipt of an invoice therefor. Charges shall be
supported by reasonable documentation (which may be maintained in electronic
form), consistent with past practices. Late payments shall bear interest at the
lesser of the prime rate announced by Chase Bank and in effect from time to time
plus 2% per annum or the maximum non-usurious rate of interest permitted by
applicable law.

                  (g)      PERFORMANCE UNDER ANCILLARY AGREEMENTS.
Notwithstanding anything to the contrary contained herein, the Receiving Company
shall not be charged under this Agreement for any Services that are specifically
required to be performed under the Genco Separation Agreement or any other
Ancillary Agreement and any such other Services shall be performed and charged
for in accordance with the terms of the Genco Separation Agreement or such other
Ancillary Agreement.

                  (h)      ERROR CORRECTION; TRUE-UPS; ACCOUNTING. The Providing
Company shall make adjustments to charges as required to reflect the discovery
of errors or omissions in charges. The Providing Company and the Receiving
Company shall conduct an annual true-up process to adjust charges based on a
reconciliation of differences in budgeted usage and costs with actual
experience. It is the intent of the parties that such true-up process will be
conducted using substantially the same process, procedures and methods of review
as have been heretofore in effect. Services under this Agreement and charges
therefor shall be subject to the audit rights set forth in Section 8.4 of the
Genco Separation Agreement.

                  2.4      GENERAL OBLIGATIONS; STANDARD OF CARE.

                  (a)      PERFORMANCE METRICS: PROVIDING COMPANY. Subject to
Sections 2.3 and 2.5(c), the Providing Company shall maintain sufficient
resources to perform its obligations hereunder and shall perform such
obligations in a commercially reasonable manner. Specific performance metrics
for the Providing Company may be set forth in Exhibits. Where none is set forth,
the Providing Company shall provide Services in accordance with the policies,
procedures and practices in effect before the date of this Agreement and shall
exercise the same care and skill as it exercises in performing similar services
for itself.

                  (b)      PERFORMANCE METRICS: RECEIVING COMPANY. Specific
performance metrics for the Receiving Company may be set forth in Exhibits.
Where none is set forth, the Receiving Company shall, in connection with
receiving Services, follow the policies, procedures and practices in effect
before the date of this Agreement including providing information and
documentation sufficient for the Providing Company to perform the Services as
they were performed before the date of this Agreement and making available, as
reasonably requested by the Providing Company, sufficient resources and timely
decisions, approvals and acceptances in order that the Providing Company may
accomplish its obligations hereunder in a timely manner.

                                        8

<PAGE>

                  (c)      TRANSITIONAL NATURE OF SERVICES; CHANGES. The parties
acknowledge the transitional nature of the Services and that the Providing
Company may make changes from time to time in the manner of performing the
Services if the Providing Company is making similar changes in performing
similar services for members of its own Group and if the Providing Company
furnishes to the Receiving Company substantially the same notice the Providing
Company shall provide members of its own Group respecting such changes.

                  (d)      RESPONSIBILITY FOR ERRORS; DELAYS. The Providing
Company's sole responsibility to the Receiving Company:

                  (i)      for errors or omissions in Services shall be to
         furnish correct information and/or adjustment in the Services, at no
         additional cost or expense to the Receiving Company; provided, the
         Receiving Company must promptly advise the Providing Company of any
         such error or omission of which it becomes aware after having used
         reasonable efforts to detect any such errors or omissions in accordance
         with the standard of care set forth in subsection 2.4(b); and provided,
         further, that the responsibility to furnish correct information or an
         adjustment of services at no additional cost or expense to the
         Receiving Company shall not be construed to require the Providing
         Company to make any payment or incur any Liability for which it is not
         responsible, or with respect to which it is provided indemnity, under
         Section 2.8; and

                  (ii)     for failure to deliver any Service because of
         Impracticability shall be to use commercially reasonable efforts,
         subject to subsection 2.5(b), to make the Services available and/or to
         resume performing the Services as promptly as reasonably practicable.

                  (e)      GOOD FAITH COOPERATION; CONSENTS. The parties will
use good faith efforts to cooperate with each other in all matters relating to
the provision and receipt of Services. Such cooperation shall include exchanging
information, providing electronic access to systems used in connection with
Services to the extent the systems in use are designed and configured to permit
such access, performing true-ups and adjustments and obtaining all consents,
licenses, sublicenses or approvals necessary to permit each party to perform its
obligations hereunder. The costs of obtaining such consents, licenses,
sublicenses or approvals shall be allocated in accordance with Section 2.3. The
parties will maintain documentation supporting the information contained in the
Exhibits and cooperate with each other in making such information available as
needed in the event of a tax audit, whether in the United States or any other
country.

                  (f)      ALTERNATIVES. If the Providing Company reasonably
believes it is unable to provide any Service because of a failure to obtain
necessary consents, licenses, sublicenses or approvals pursuant to subsection
2.4(e) or because of Impracticability, the parties shall cooperate to determine
the best alternative approach. Until such alternative approach is found or the
problem otherwise resolved to the satisfaction of the parties, the Providing
Party shall use commercially reasonable efforts, subject to Section 2.5(b) and
Section 2.5(c), to continue providing the Service or, in the case of Systems, to
support the function to which the System relates or permit Receiving Party to
have access to the System so Receiving Party can support the function itself.

                                        9

<PAGE>

                  2.5      CERTAIN LIMITATIONS.

                  (a)      SERVICE BOUNDARIES AND SCOPE. Except as provided in
an Exhibit for a specific Service, (i) the Providing Company shall be required
to provide the Services only at the locations such Services are being provided
by the Providing Company for the members of the Genco Group immediately prior to
the Genco Distribution Date; and (ii) the Services will be available only for
purposes of conducting the business of Genco and its Subsidiaries substantially
in the manner it was conducted prior to the Genco Distribution Date.

                  (b)      IMPRACTICABILITY. The Providing Company shall not be
required to provide any Service to the extent the performance of such Service
becomes "Impracticable" as a result of a cause or causes outside the reasonable
control of the Providing Company including unfeasible technological
requirements, or to the extent the performance of such Services (i) would
require the Providing Company to violate any applicable laws, rules or
regulations or (ii) would result in the breach of any software license or other
applicable contract in effect on the date of this Agreement.

                  (c)      ADDITIONAL RESOURCES. Except as provided in an
Exhibit for a specific Service, in providing the Services, the Providing Company
shall not be obligated to (i) maintain the employment of any specific employee;
(ii) purchase, lease or license any additional equipment or software; or (iii)
pay any costs related to the transfer or conversion of the Receiving Company's
data to the Receiving Company or any alternate supplier of Services.

                  (d)      NO SALE, TRANSFER, ASSIGNMENT. No Receiving Company
may sell, transfer, assign or otherwise use the Services provided hereunder, in
whole or in part, for the benefit of any Person other than a member of the Genco
Group.

                  2.6      CONFIDENTIALITY.

                  (a)      INFORMATION SUBJECT TO OTHER OBLIGATIONS. The
Providing Company and the Receiving Company agree that all Information regarding
the Services, including, but not limited to, price, costs, methods of operation,
and software, and all Information provided by any Receiving Company in
connection with the Services, shall be maintained in confidence and shall be
subject to Sections 8.2 and 8.11 of the Genco Separation Agreement.

                  (b)      ALL INFORMATION CONFIDENTIAL. The Providing Company's
Systems used to perform the Services provided hereunder are confidential and
proprietary to the Providing Company or third parties. The Receiving Company
shall treat these Systems and all related procedures and documentation as
confidential and proprietary to the Providing Company or its third party
vendors.

                  (c)      INTERNAL USE; TITLE, COPIES, RETURN. Subject to the
applicable provisions of the Genco Separation Agreement governing ownership, use
and licensing of Intellectual Property (as defined therein), the Receiving
Company agrees that:

                  (i)      all Systems, procedures and related materials
         provided to the Receiving Company are for the Receiving Company's
         internal use only and only as related to the Services or any of the
         underlying Systems used to provide the Services;

                                       10

<PAGE>

                  (ii)     title to all Systems used in performing the Services
         provided hereunder shall remain in the Providing Company or its third
         party vendors;

                  (iii)    The Receiving Company shall not copy, modify, reverse
         engineer, decompile or in any way alter Systems without the Providing
         Company's express written consent; and

                  (iv)     Upon the termination of any of the Services, the
         Receiving Company shall return to the Providing Company, as soon as
         practicable, any equipment or other property of the Providing Company
         relating to the Services which is owned or leased by it and is or was
         in the Receiving Company's possession or control.

                  2.7      TERM; EARLY TERMINATION.

                  (a)      TERM. The term of this Agreement shall commence on
the date hereof and shall remain in effect through the earlier of such time as
(i) all Services are terminated as provided in this Section or (ii) CenterPoint
ceases to own a majority of the voting power represented by the outstanding
Genco common stock. This Agreement may be extended by the parties in writing
either in whole or with respect to one or more of the Services, provided,
however, that such extension shall only apply to the Service for which the
Agreement was extended. The parties may agree on an earlier expiration date
respecting a specific Service by specifying that date on the Exhibit for that
Service. Services shall be provided up to and including the date set forth in
the applicable Exhibit, subject to earlier termination as provided herein.

                  (b)      TERMINATION BY GENCO OF SPECIFIC SERVICE CATEGORIES.
Genco may terminate this Agreement either with respect to all, or with respect
to any one or more, of the Services provided hereunder at any time and from time
to time, for any reason or no reason, by giving written notice to the Providing
Party as follows:

                  (i)      for Corporate Center Services, except to the extent
         otherwise provided in Exhibit 2.1(a)(i), a terminated category of
         Services must include all Services included in one of the nine major
         service categories specified in Exhibit 2.1(a)(i), and notice of
         termination thereof must be given at least 30 days in advance of the
         effective date of the termination.

                  (ii)     for Information Technology Services, a terminated
         category of Services must include one of the thirteen major service
         categories specified in Exhibit 2.1(a)(ii), in its entirety, and a
         notice of termination must be given at least 90 days in advance of the
         effective date of the termination.

                  (iii)    for Shared Services, a terminated category of
         Services must include a complete service function specified in Exhibit
         2.7(b)(iii) and advance notice of termination for that function must be
         given no later than the date specified in Exhibit 2.7(b)(iii).

                                       11

<PAGE>

                  (c)      TERMINATION OF LESS THAN ALL SERVICES. In the event
of any termination with respect to one or more, but less than all, Services,
this Agreement shall continue in full force and effect with respect to any
Services not terminated hereby.

                  (d)      USER IDs, PASSWORDS. The parties shall use good faith
efforts at the termination or expiration of this Agreement or any specific
Exhibit hereto, to ensure that all user IDs and passwords are canceled and,
subject to Section 2.6(c), that any data pertaining solely to the other parties
are deleted or removed from Systems.

                  2.8      DISCLAIMER OF WARRANTIES, LIMITATION OF LIABILITY AND
INDEMNIFICATION.

                  (a)      DISCLAIMER OF WARRANTIES. EACH PROVIDING COMPANY AND
ITS SUBSIDIARIES DISCLAIM ALL WARRANTIES, EXPRESS OR IMPLIED, INCLUDING, BUT NOT
LIMITED TO, THE IMPLIED WARRANTIES OF MERCHANTABILITY AND FITNESS FOR A
PARTICULAR PURPOSE, WITH RESPECT TO THE SERVICES. EACH PROVIDING COMPANY AND ITS
SUBSIDIARIES MAKE NO REPRESENTATIONS OR WARRANTIES AS TO THE QUALITY,
SUITABILITY OR ADEQUACY OF THE SERVICES FOR ANY PURPOSE OR USE.

                  (b)      LIMITATION OF LIABILITY; INDEMNIFICATION OF RECEIVING
COMPANY. Each Providing Company and its Subsidiaries shall have no Liability to
any Receiving Company with respect to its furnishing any of the Services
hereunder except for Liabilities arising out of or resulting from the gross
negligence or willful misconduct occurring after the Genco Distribution Date of
the Providing Company or any of its Subsidiaries. Each Providing Company will
indemnify, defend and hold harmless each Receiving Company in respect of all
such Liabilities arising out of or resulting from such gross negligence or
willful misconduct. Such indemnification obligation shall be a Liability of the
Providing Company for purposes of the Genco Separation Agreement, and the
provisions of Article III of the Genco Separation Agreement with respect to
indemnification shall govern with respect thereto. IN NO EVENT SHALL A PROVIDING
COMPANY OR ANY OF ITS SUBSIDIARIES HAVE ANY LIABILITY UNDER THIS AGREEMENT OR
OTHERWISE ARISING OUT OF OR RESULTING FROM THE PERFORMANCE OF, OR THE FAILURE TO
PERFORM, SERVICES FOR LOSS OF ANTICIPATED PROFITS BY REASON OF ANY BUSINESS
INTERRUPTION, FACILITY SHUTDOWN OR NON-OPERATION, LOSS OF DATA OR OTHERWISE OR
FOR ANY INCIDENTAL, INDIRECT, SPECIAL OR CONSEQUENTIAL DAMAGES, WHETHER OR NOT
CAUSED BY OR RESULTING FROM NEGLIGENCE, INCLUDING GROSS NEGLIGENCE, OR BREACH OF
OBLIGATIONS HEREUNDER AND WHETHER OR NOT THE PROVIDING COMPANY OR ANY OF ITS
SUBSIDIARIES WAS INFORMED OF THE POSSIBILITY OF THE EXISTENCE OF SUCH DAMAGES.

                  (c)      LIMITATION OF LIABILITY; INDEMNIFICATION OF PROVIDING
COMPANY. Each Receiving Company shall indemnify and hold harmless each Providing
Company in respect of all Liabilities arising out of or resulting from the
Providing Company's furnishing or failing to furnish the Services provided for
in this Agreement, other than Liabilities arising out of or resulting from the
gross negligence or willful misconduct of the Providing Company. The provisions
of this indemnity shall apply only to losses that relate directly to the
provision of Services. Such indemnification obligation shall be a Liability of
the Receiving Company for purposes of the Genco Separation Agreement and the
provisions of Article III of the Genco

                                       12

<PAGE>

Separation Agreement with respect to indemnification shall govern with respect
thereto. IN NO EVENT SHALL A RECEIVING COMPANY OR ANY OF ITS SUBSIDIARIES HAVE
ANY LIABILITY UNDER THIS AGREEMENT OR OTHERWISE ARISING OUT OF OR RESULTING FROM
THE PERFORMANCE OF, OR THE FAILURE TO PERFORM, SERVICES FOR LOSS OF ANTICIPATED
PROFITS BY REASON OF ANY BUSINESS INTERRUPTION, FACILITY SHUTDOWN OR
NON-OPERATION, LOSS OF DATA OR OTHERWISE OR FOR ANY INCIDENTAL, INDIRECT,
SPECIAL OR CONSEQUENTIAL DAMAGES, WHETHER OR NOT CAUSED BY OR RESULTING FROM
NEGLIGENCE, INCLUDING GROSS NEGLIGENCE, OR BREACH OF OBLIGATIONS HEREUNDER AND
WHETHER OR NOT THE PROVIDING COMPANY OR ANY OF ITS SUBSIDIARIES WAS INFORMED OF
THE POSSIBILITY OF THE EXISTENCE OF SUCH DAMAGES.

                  (d)      SUBROGATION OF RIGHTS VIS-A-VIS THIRD PARTY
CONTRACTORS. In the event any Liability arises from the performance of Services
hereunder by a third party contractor, the Receiving Company shall be subrogated
to such rights, if any, as the Providing Company may have against such third
party contractor with respect to the Services provided by such third party
contractor to or on behalf of the Receiving Company. Subrogation under this
Section 2.8(d) shall not affect the obligation of the Providing Company to
perform Services under this Agreement.

                  2.9      REPRESENTATIVES. The parties shall each appoint one
or more Representatives to facilitate communications and performance under this
Agreement. The maximum number of Representatives for each party shall be three,
one for each of the three principal categories specified in Section 2.1(a). Each
party may treat an act of a Representative of another party as being authorized
by such other party without inquiring behind such act or ascertaining whether
such Representative had authority to so act. Each party shall have the right at
any time and from time to time to replace any of its Representatives by giving
notice in writing to the other party setting forth the name of (i) each
Representative to be replaced and (ii) the replacement, and certifying that the
replacement Representative is authorized to act for the party giving the notice
in all matters relating to this Agreement (or matters relating to one or more
categories specified in Section 2.1(a)). Each Representative is hereby
authorized by the party he or she represents to approve the establishment of new
or modifications to existing Exhibits for Initial Services before or after the
Genco Distribution Date and the addition of new Exhibits for Additional Services
after the Genco Distribution Date.

                  2.10     EMPLOYEE MATTERS. To the extent Genco has adopted
such plans or programs, eligible employees of Genco will continue to participate
in CenterPoint's benefit plans and programs after the Genco Distribution Date,
in accordance with the terms and conditions of such plans and programs as they
may be amended or terminated by CenterPoint at any time, for so long as
CenterPoint continues to own 80% or more of the shares of Genco common stock or
such earlier date as Genco elects to terminate participation in one or more of
such plans or programs.

                                   ARTICLE III
                                  MISCELLANEOUS

                  3.1      TAXES. (a) General. Each Receiving Company shall bear
all taxes, duties and other similar charges (and any related interest and
penalties), imposed as a result of its receipt of Services under this Agreement,
including any tax which a Receiving Company is

                                       13

<PAGE>

required to withhold or deduct from payments to a Providing Company, except any
net income tax imposed upon the Providing Company by the country of its
incorporation or any governmental entity within its country of incorporation.

                  (b)      Sales Tax Liability and Payment. Notwithstanding
Section 3.1(a), each Receiving Company is liable for and will indemnify and hold
harmless any Providing Company from all sales, use and similar taxes (plus any
penalties, fines or interest thereon) (collectively, "Sales Taxes") assessed,
levied or imposed by any governmental or taxing authority on the providing of
Services by the Providing Company to the Receiving Company. The Providing
Company shall collect from the Receiving Company any Sales Tax that is due on
the Service it provides to such Receiving Company and shall pay such Sales Tax
so collected to the appropriate governmental or taxing authority.

                  3.2      LAWS AND GOVERNMENTAL REGULATIONS. The Receiving
Company shall be responsible for (i) compliance with all laws and governmental
regulations affecting its business and (ii) any use the Receiving Company may
make of the Services to assist it in complying with such laws and governmental
regulations. The provision of Services shall comply, to the extent applicable,
with CenterPoint's Internal Code of Conduct. The Providing Company shall comply
with all laws and governmental regulations applicable to the provision of
Services.

                  3.3      RELATIONSHIP OF PARTIES. Nothing in this Agreement
shall be deemed or construed by the parties or any third party as creating the
relationship of principal and agent, partnership or joint venture between the
parties, it being understood and agreed that no provision contained herein, and
no act of the parties, shall be deemed to create any relationship between the
parties other than the relationship of independent contractor nor be deemed to
vest any rights, interest or claims in any third parties.

                  3.4      REFERENCES. All reference to Sections, Articles,
Exhibits or Schedules contained herein mean Sections, Articles, Exhibits or
Schedules of or to this Agreement, as the case may be, unless otherwise stated.
When a reference is made in this Agreement to a "party" or "parties", such
reference shall be to a party or parties to this Agreement unless otherwise
indicated. Whenever the words "include", "includes" or "including" are used in
this Agreement, they shall be deemed to be followed by the words "without
limitation". The use of the singular herein shall be deemed to be or include the
plural (and vice versa) whenever appropriate. The use of the words "hereof",
"herein", "hereunder", and words of similar import shall refer to this entire
Agreement, and not to any particular article, section, subsection, clause,
paragraph or other subdivision of this Agreement, unless the context clearly
indicates otherwise. The word "or" shall not be exclusive; "may not" is
prohibitive and not permissive.

                  3.5      MODIFICATION AND AMENDMENT. Except for modifications
to Exhibits, which may be made by Representatives pursuant to Section 2.9
hereof, this Agreement may not be modified or amended, or any provision waived,
except in the manner set forth in the Genco Separation Agreement.

                  3.6      INCONSISTENCY. In the event of any inconsistency
between the terms of this Agreement and any of the Exhibits hereto, the terms of
this Agreement, other than charges, shall control.

                                       14

<PAGE>

                  3.7      RESOLUTION OF DISPUTES. If a dispute, claim or
controversy results from or arises out of or in connection with this Agreement
or the performance of, or failure to perform, the Services, the parties agree to
use the procedures set forth in Article VII of the Genco Separation Agreement,
in lieu of other available remedies, to resolve the same.

                  3.8      SUCCESSORS AND ASSIGNMENT. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
successors and permitted assigns. Except as contemplated by Section 2.2, no
party shall assign this Agreement or any rights herein without the prior written
consent of the other party, which may be withheld for any or no reason.

                  3.9      NOTICES. Unless expressly provided herein, all
notices, claims, certificates, requests, demands and other communications
hereunder shall be in writing and shall be deemed to be duly given (i) when
personally delivered or (ii) if mailed registered or certified mail, postage
prepaid, return receipt requested, on the date the return receipt is executed or
the letter refused by the addressee or its agent or (iii) if sent by overnight
courier which delivers only upon the signed receipt of the addressee, on the
date the receipt acknowledgment is executed or refused by the addressee or its
agent or (iv) if sent by facsimile or other generally accepted means of
electronic transmission, on the date confirmation of transmission is received
(provided that a copy of any notice delivered pursuant to this clause (iv) shall
also be sent pursuant to clause (ii) or (iii)), addressed to the attention of
the addressee's Chief Executive Officer at the address of its principal
executive office or to such other address or facsimile number for a party as it
shall have specified by like notice.

                  3.10     GOVERNING LAW. This Agreement shall be governed by
and construed in accordance with the laws of the State of Texas.

                  3.11     SEVERABILITY. Wherever possible, each provision of
this Agreement shall be interpreted in such a manner as to be effective and
valid under applicable law. If any portion of this Agreement is declared invalid
for any reason, such declaration shall have no effect upon the remaining
portions of this Agreement, which shall continue in full force and effect as if
this Agreement had been executed with the invalid portions thereof deleted.

                  3.12     COUNTERPARTS. This Agreement may be executed in two
or more counterparts, each of which shall be deemed an original, and all of
which shall constitute one and the same instrument.

                  3.13     RIGHTS OF THE PARTIES. Nothing expressed or implied
in this Agreement is intended or will be construed to confer upon or give any
person or entity, other than the parties and to the extent provided herein their
respective Subsidiaries, any rights or remedies under or by reason of this
Agreement or any transaction contemplated thereby.

                  3.14     RESERVATION OF RIGHTS. The waiver by either party of
any of its rights or remedies afforded hereunder or at law is without prejudice
and shall not operate to waive any other rights or remedies which that party
shall have available to it, nor shall such waiver operate to waive the party's
rights to any remedies due to a future breach, whether of a similar or different
nature. The failure or delay of a party in exercising any rights granted to it
hereunder shall not constitute a waiver of any such right and that party may
exercise that right at any time.

                                       15

<PAGE>

Any single or partial exercise of any particular right by a party shall exhaust
the same or constitute a waiver of any other right.

                  3.15     ENTIRE AGREEMENT. All understandings,
representations, warranties and agreements, if any, heretofore existing between
the parties regarding the subject matter hereof are merged into this Agreement,
which fully and completely express the agreement of the parties with respect to
the subject matter hereof.

                                       16

<PAGE>

         IN WITNESS WHEREOF, the parties have executed this Transition Services
Agreement as of the date first above written.

                                  CENTERPOINT ENERGY, INC.

                                  By: /s/ DAVID M. MCCLANAHAN
                                      ------------------------------------------
                                      David M. McClanahan
                                      President and Chief Executive Officer

                                  TEXAS GENCO HOLDINGS, INC.

                                  By: /s/ DAVID G. TEES
                                      ------------------------------------------
                                      David G. Tees
                                      President and Chief Executive Officer

                                       17

<PAGE>

                                                               EXHIBIT 2.1(a)(i)

                            CORPORATE CENTER SERVICES

A1.      OFFICE OF THE CHIEF ACCOUNTING OFFICER.

                  The Office of the Chief Accounting Officer includes the
general activities and costs to support the Office of the Chief Accounting
Officer such as salaries for the Chief Accounting Officer and an Executive
Assistant as well as the costs associated with the following corporate centers:

         A.1.1.   Corporate Risk Control.

         The major activities and costs associated with this corporate cost
center include:

         -        Establish and monitor risk policies and limits.

         -        Ensure the adequacy of SBU's infrastructures to comply with
                  established risk control policies, procedures and limits.

         -        Ensure reasonableness of valuation methodologies, assumptions
                  and models.

         -        Provide support and oversight for the development of capital
                  projects and other major commitments.

         -        Provide consulting on risk-related activities as needed.

         -        Support Board of Directors Audit Committee

         A.1.2.   Financial Accounting.

         Major activities and costs associated with this corporate center
include:

         -        Preparation of internal and external financial reports.

         -        Financial analysis of the results of operations.

         -        External audit fees.

         -        Consulting fees relating to financial accounting issues.

         -        SEC compliance reporting.

         -        Accounting support of financing activities.

         -        Accounting support for various strategic planning initiatives.

         -        Financial projections and quarterly performance reviews.

         -        Accounting support on business unit capital projects,
                  acquisitions, etc.

         -        Support Board of Directors Audit Committee

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<PAGE>

         A.1.3.   Federal Tax.

         Major activities and costs associated with this corporate center
include:

         -        Federal tax planning.

         -        Preparation of estimates of federal taxes.

         -        Calculation of current and deferred federal tax expense.

         -        Current taxes payable and deferred tax liability.

         -        Preparation of federal income tax returns.

         -        Coordination and response to Internal Revenue Service
                  inquiries and audits.

         -        Preparation and maintenance of international tax data for
                  accrual and dividend planning purposes.

         -        Maintenance of tax systems.

         -        Monitoring proposed tax legislation.

         -        Litigation support for federal tax issues.

         -        Due diligence reviews of tax implications of proposed
                  acquisitions.

         -        Consulting fees related to federal tax issues and strategic
                  planning.

         A.1.4.   State and Local Tax.

         Major activities and costs associated with this corporate center
include:

         -        Preparation of sales and use tax returns.

         -        Preparation of state income and franchise tax returns.

         -        Preparation of estimates and payment of state income taxes.

         -        Calculation of state current and deferred tax expense, current
                  taxes payable, and deferred tax liabilities.

         -        State tax planning.

         -        Coordination and response to state and local tax inquiries and
                  audits.

         -        Costs of consulting fees related to sales, use, and state tax
                  issues, and strategic planning.

         -        Preparation of SFAS 109 accruals.

         -        Performance of due diligence reviews for proposed acquisitions
                  and state income tax estimates for proposed acquisitions.

         -        Monitoring of proposed tax legislation and preparing
                  appropriate response.

         -        Litigation support for state and local tax issues.

                                        2

<PAGE>

         A.1.5.   Property Tax.

         Major activities and costs associated with this corporate center
include:

         -        Payment and review of property taxes and preparation of
                  returns.

         -        Negotiation of property taxes.

         -        Costs of consulting fees related to property and tax issues
                  and strategic planning.

         A.1.6.   Internal Audit.

         The major activities and costs associated with this corporate center
include:

         -        Internal process and financial reviews of business units and
                  business units' functions.

         -        Internal process reviews of corporate functions.

         -        Assist in the external audit.

         -        Review of benefit payments, travel expenses, etc.

         -        Operational audits.

         -        Assist in due diligence reviews of projects, acquisitions,
                  etc.

         -        Participate and supplement corporate risk functions.

         -        Support Board of Directors Audit Committee.

A2.      CORPORATE FINANCE.

                  Corporate Finance includes the general activities and costs
such as salaries of the Vice President Corporate Finance, Treasurer and
executive assistants, and consulting costs related to financings and insurance.
This area also includes the costs and activities associated with the following
corporate cost centers:

         A.2.1.   Financial Services.

         The major activities and costs associated with this corporate cost
center include:

         -        General activities and costs to support the financial services
                  function.

         -        Debt compliance monitoring.

         -        Payment of financing obligations (including interest) and
                  related fees, trust fees, etc.

         -        Review of pension plan portfolio and make funding payments to
                  the pension trust. (Trust Administration)

         -        Trust administration for nuclear decommissioning trust.

                                        3

<PAGE>

         A.2.2.   Cash Management.

         The major activities and costs associated with this corporate cost
center include:

         -        General activities and costs to support cash management
                  including department salaries, secretarial services, and
                  supplies.

         -        Payment of financing obligations (including interest) and
                  related fees.

         -        Daily cash management.

         -        Monitoring bank accounts.

         -        Execution of wire transfers.

         -        Forecasting cash needs.

         -        Managing banking relations in order to resolve problems and to
                  minimize transaction costs.

         A.2.3.   Corporate Insurance.

         The major activities and costs associated with this corporate cost
center include:

         -        General activities and costs to support the insurance benefits
                  group including salaries for department employees.

         -        Internal evaluation of insurance risks and needs.

         -        Consulting costs related to insurance evaluations.

         A.2.4.   Investor Services.

         The major activities and costs associated with this corporate cost
center include:

         -        General activities and costs to support the investor services
                  department including salaries and supplies.

         -        Payment of dividends to shareholders.

         -        Coordination of dividend reinvestment plan.

         -        Mailing of annual reports

         -        Shareholder recordkeeping.

         -        Coordination of shareholder meetings.

         A.2.5.   Corporate Finance.

         The major activities and costs associated with this corporate cost
center include:

         -        General activities and costs to support the corporate finance
                  function.

         -        Evaluation and implementation of optimal capital structures,
                  optimal sources of capital, and the attraction of capital.

         -        Support for investment activities.

         -        Establishment of and preservation of the liquidity.

                                        4

<PAGE>

         -        Establishment and maintenance of relations with the rating
                  agencies, banks, and the fixed income, mezzanine and private
                  equity communities.

         -        Preparation of periodic rating agency presentations.

A3.      INVESTOR RELATIONS.

                  Major costs and activities associated with this corporate cost
center include:

         -        General activities and costs to support the investor relations
                  department including salaries of department employees,
                  secretarial services, travel, and meeting costs.

         -        Communication with the investment community (institutional
                  investors and shareholders) about earnings and business
                  strategies.

         -        Plan and prepare analyst presentations.

         -        Meetings with security analysts and rating agencies.

         -        Prepare financial analysis to support discussions with
                  security analysts and rating agencies.

         -        Prepare print publications (reports/fact sheets) sent to third
                  parties including investors, analysts, shareholders and rating
                  agencies.

         -        Speechwriting for financial presentations/meetings.

A4.      CORPORATE PLANNING

                  The major activities and costs associated with this corporate
cost center include:

         -        General activities and costs to support strategic planning for
                  corporate and business units such as salaries of strategic
                  planning department employees, secretarial services,
                  consulting costs, etc.

         -        Assistance to business units in the development of strategies,
                  goals, and measures.

         -        Economic and financial analysis of business unit and corporate
                  strategies.

         -        Development and analysis of five year strategic forecasts of
                  business units.

         -        Outside consulting costs related to the evaluation of
                  strategic plans of business units and corporate.

A5.      OFFICE OF THE GENERAL COUNSEL.

                  The Office of the General Counsel (Legal Department) is
responsible for managing the legal affairs. The major activities and costs that
are associated with this corporate cost center include:

                                        5

<PAGE>

         -        General legal activities and costs to support the corporate
                  office and all business units including salaries of in-house
                  attorneys, other legal professionals, legal assistants,
                  outside counsel fees, travel costs, duplication costs, etc.

         -        Corporate and securities law.

         -        Employment law.

         -        Regulatory law.

         -        Contract law.

         -        Patent law.

         -        Litigation.

         -        Work related to and evaluation of legal claims.

         -        Outside counsel to assist in the above activities.

A6.      CORPORATE COMMUNICATIONS.

                  This corporate center includes those activities and costs
necessary to support the administration and management of corporate
communications. Services include external communications and event sponsorship
with customers, media, financial audiences, and the community at large. The
following corporate cost centers are also a part of corporate communications:

         A.6.1.   Internal Relations.

         The major activities and costs associated with this corporate cost
center include:

         -        General activities and costs to support the internal relations
                  department including department salaries, secretarial service,
                  publications, printing costs, etc.

         -        Internal communication assistance to other business units.

         -        Internal employee communications.

         -        Communication of corporate and business unit visions to the
                  employees.

         -        Employee awards.

         -        Development and maintenance of intranet sites.

         A.6.2.   External Relations.

         -        This corporate center includes the following major functions
                  and the associated costs to support them including salaries of
                  management, other professional and secretarial assistance,
                  outside services for production of print, video and Internet
                  communications materials, outside production costs for events
                  and consulting fees.

                                        6

<PAGE>

         A.6.2.1.          Public Relations, Corporate & Financial
                           Communications

         -        External communication of financial, strategic and general
                  corporate information as well as communications to announce
                  and launch new business ventures. Audiences include national,
                  financial, trade and local news media, stockholders,
                  customers, trade associations and the general public.

         -        Production of annual and quarterly reports to shareholders,
                  executive speeches, corporate brochures and videos and
                  corporate information on Internet sites.

         -        Communications support for unregulated business units,
                  including:

                  -        Response to media inquiries

                  -        Pro-active media relations

                  -        Project communications

                  -        Event coordination

                  -        Selection and supervision of outside public relations
                           firms retained for specific projects

                  -        Screening, selection and speechwriting services for
                           speaking engagements

         A.6.2.2.          Corporate Branding & Promotions

         -        Development and management of the corporate names, logotypes
                  and brand identity standards.

         -        Sponsorships and event marketing activities to create strong
                  external awareness of CenterPoint and the unregulated business
                  units.

         -        Implementation and management of promotional opportunities
                  created for CenterPoint and the unregulated business units
                  through sponsorships.

         -        Management of special events for other corporate centers such
                  as Corporate Community Relations and the unregulated business
                  units.

A7.      GOVERNMENT AFFAIRS.

                  The major activities and costs associated with this center are
the salaries of executives, professionals and executive assistants as well as
consultant and advisor and other costs directly related to legislative advocacy.
This corporate center also includes a number of other cost centers that are
described below:

         A.7.1.   Texas State Relations.

         The major activities and costs associated with this corporate cost
center include:

         -        General activities and costs to support the Texas state
                  governmental relations department including salaries of
                  department employees, secretarial services, state legislative
                  advocacy costs, legislative consulting and advisor costs, and
                  travel costs, etc.

                                       7

<PAGE>

         -        Lobbying activities related to industry issues, environmental
                  issues, taxes, nuclear waste, tort reform, ethics, etc.

         -        Housing accommodations in Austin, Texas.

         A.7.2.   Limestone and Cedar Bayou Conference Centers.

         -        The major activities and costs associated with this corporate
                  cost center are to support the operation and maintenance of
                  the Cedar Bayou Conference Center including salaries of
                  permanent staff and site-related costs.

         A.7.3.   Federal Relations.

         The major costs and activities associated with this corporate cost
center include:

         -        General activities and costs to support the federal
                  governmental relations department including salaries of
                  department employees, secretarial services, federal
                  legislative advocacy costs, federal legislative consulting and
                  advisor costs, and travel costs, etc.

         -        Lobbying activities related to industry issues, PUHCA,
                  environmental issues, taxes, transportation, etc.

         A.7.4.   Third Party Initiatives.

         The major costs and activities associated with this corporate cost
center include:

         -        General activities and costs to support legislative
                  initiatives including salaries of department employees,
                  secretarial services, legislative advocacy costs, legislative
                  consulting and advisor costs, and travel costs, etc.

         -        Preparation of ethics filings (state, local, and federal).

         -        Communication with Third Party Groups to minimize adverse
                  legislation.

         -        Communication with employees encouraging participation of
                  employees in legislative activities.

         A.7.5.   Corporate Community Relations.

         The major costs and activities associated with this corporate cost
center include:

         -        Local and regional charitable contributions and donations.

         -        Coordination of corporate contributions and memberships.

         -        Communication and establishment of relationship with
                  community.

                                        8

<PAGE>

         A.7.6.   Local Government Relations.

         The major costs and activities associated with this corporate cost
center include:

         -        General activities and costs to support the Texas local
                  governmental relations department including salaries of
                  department employees, secretarial services, local legislative
                  advocacy costs, legislative consulting and advisor costs, etc.

         -        Lobbying activities related to industry issues, environmental
                  issues, taxes, franchise taxes, operational ordinances, etc.,
                  with local regulators.

         A.7.7.   State Affairs.

         The major activities and costs associated with this corporate cost
center include:

         -        General activities and costs to support the State Affairs
                  (primarily for states other than Texas) governmental relations
                  department including salaries of department employees,
                  secretarial services, state legislative advocacy costs,
                  legislative consulting and advisor costs, and travel costs,
                  etc. Outside consulting costs are direct billed to the
                  appropriate SBU.

         -        Lobbying activities related to acquiring, siting, licensing,
                  operating and maintaining power plants along with
                  deregulation, environmental issues, taxes, etc.

A8.      CORPORATE HUMAN RESOURCES

         A.8.1.   Compensation Design and Delivery

         Major activities and costs associated with this corporate center
include:

         -        Provide consultation and counseling on compensation issues.

         -        Provide data input, execution and retrieval for compensation
                  activities including planning, promotions, adjustments,
                  recognition, etc.

         -        Design and deliver base compensation, variable compensation,
                  long-term incentives, and recognition/retention programs.

         A.8.2.   Benefits Design and Delivery

         Major activities and costs associated with this corporate center
include:

         -        Design and deliver pension, savings, medical insurance, life
                  insurance, and other related health and welfare programs.

         -        Design and deliver annual enrollment process and other benefit
                  plan models.

         -        Focal point for providing salary survey and market information
                  for compensation planning.

                                        9

<PAGE>

         -        Lead and manage benefits call center relationship process to
                  insure client satisfaction with benefit delivery process.

         -        Perform due diligence of all acquisitions and divestitures
                  related to benefit plans.

         -        Deliver benefit programs, processes, and governance plans for
                  implementation within business/functional units.

         A.8.3.   Recruiting, Staffing and Selection

         Major activities and costs associated with this corporate center
include:

         -        Design, develop and implement internal and external hiring
                  process including college campus, local markets, and global
                  experienced candidate selection.

         -        Develop interview and selection process.

         -        Manage contingent workforce contracts and relationships.

         -        Manage labor and union relationships.

         -        Manage separation process and policy including outplacement
                  service providers.

         -        Develop and administer relocation process both on a domestic
                  and an international basis.

         -        Provide for effective SAP interface and implementation of
                  technology support and resources to provide reporting, data
                  management, and user-friendly applications for client use.

         -        Focal point for corporate diversity process and affirmative
                  action plans.

         -        Design and manage new hire orientation and related employee
                  processing activities in conjunction with business/functional
                  units, including pre-employment screening processes and
                  testing activity.

         -        Manage and administer unemployment and worker compensation
                  claims.

         A.8.4.   Organization Effectiveness and Learning

         Major activities and costs associated with this corporate center
include:

         -        Design and/or select learning resources to support client
                  needs and build competencies.

         -        Deliver tools and services to clients to facilitate
                  organizational assessment, benchmarking, problem solving,
                  process re-engineering, breakthrough thinking, change
                  management, and succession planning.

         -        Manage external provider relationships for delivery of
                  training and other learning/assessment resources.

         -        Manage and schedule internal learning facilities and resources
                  including training rooms, conference sites, materials, and
                  distance learning processes.

                                       10

<PAGE>

         -        Tool development and implementation process for delivery of
                  Individual Performance Improvement Process.

A9.      REGULATORY

         Major activities and costs associated with this corporate center
include:

         -        Identifying, analyzing and communicating key issues related to
                  the public, local, state and federal regulators.

         -        Preparation of filings.

         -        Participation in hearings.

         -        Communication to internal and external stakeholders.

         -        Regulatory planning and policy.

                                       11

<PAGE>

                                                              Exhibit 2.1(a)(ii)

                         INFORMATION TECHNOLOGY SERVICES

SERVICE 1: DATA CIRCUIT MANAGEMENT

         -    Circuit Connection and Internal Distribution

         -    Capacity Monitoring

         -    Circuit Consolidation Services

         -    Carrier Management and Administration (Life Cycle Management)

         -    Access to CenterPoint Private Communication Network

         -    Software/Hardware Maintenance for Data Network Components

         -    Vendor and Contract Management

         -    Problem Identification & Resolution

SERVICE 2: DESKTOP DATA DEVICE SERVICES

         -    Desktop Connectivity

         -    WAN Access & Transport

         -    Information Security

         -    Nerve Center Monitoring

         -    Vendor Contract Management

         -    Problem Identification & Resolution

SERVICE 3: SOLUTIONS DELIVERY (PROGRAMMING)

         SAP PRODUCTION SUPPORT

               -     SAP Applications/Development

               -     Modifications/Enhancements

               -     Deployment/Training

               -     Functional Teams

               -     Problem Identification & Resolution.

                                        1

<PAGE>

SERVICE 4: MAINFRAME OPERATIONS

         PART 1: CPU UTILIZATION & MAINFRAME DATA STORAGE

               -     Monitoring by IT Nerve Center

               -     Disaster Recovery Services for non-SAP mainframe
                     applications

               -     Migration and automated scheduling of corporate
                     applications

               -     Planning, design, acquisition, installation of hardware and
                     software upgrades

               -     Performance tuning

               -     Capacity planning and analysis (CPU, DASD, tape)

               -     Microfiche processing

               -     Online report viewing and archival

               -     White paper print (mainframe application reports)

               -     Distribution of mainframe reports to LAN printers

               -     Enterprise Change Management

               -     SAP infrastructure support

               -     Problem Identification & Resolution

         PART 2: DEDICATED SERVER SUPPORT (NON-SHARED HARDWARE)

               -     Monitoring by IT Nerve Center

               -     Problem identification and resolution

               -     Backup and Recovery

               -     Migration and automated scheduling of corporate
                     applications

               -     Planning, design, acquisition, installation of hardware and
                     software upgrades

               -     Performance tuning

               -     Capacity planning and analysis

               -     Enterprise Change Management

                                        2

<PAGE>

               -     Vendor and Contract Management

               -     Problem Identification & Resolution

         PART 3: BILL PRINT

               -     OCE High-speed mainframe printers

               -     Staffing, equipment maintenance, usage, supplies, etc. to
                     support bill print

               -     Planning, design, acquisition, installation of hardware and
                     software upgrades

               -     Disaster Recovery Services (successful test in April 2000)

               -     Problem Identification & Resolution

SERVICE 5: TELECOMMUNICATIONS

         PART 1: TELEPHONE BASIC LINE

               -     Operation and maintenance of the telephone switch network

               -     Telephone Lines, Fax Machine Lines, and Modem Lines

               -     Video/Audio Teleconference Services

               -     Voice Mail and Voice Processing Services

               -     Caller ID Services

               -     411 Information / 911 Emergency Services

               -     Security

               -     Call Feature Options

               -     Problem Identification & Resolution

         PART 2: CALL CENTER BASIC LINE

               -     Operation and Maintenance of the Phone System and New
                     Applications

               -     Private Network Connectivity

               -     Agent Consoles and Headsets

                                        3

<PAGE>

               -     Detailed Real-Time / Historical Call Traffic Management
                     Reports

               -     Security

               -     Problem Identification & Resolution

         PART 3: VOICE SERVICES MOVES/ADDS/CHANGES

               -     Consultation and technician time to add, move, or
                     reconfigure voice assets

               -     Voice desktop telephone lines, modem lines, fax machine
                     lines

               -     Miscellaneous cables and connectors

         PART 4: RADIO SERVICES

               -     Radio frequency coordination

               -     Maintenance of Federal Communication Commission licensing

               -     Federal Aviation Administration regulatory compliance for
                     radio towers

               -     Utility Telecommunication Counsel activities

               -     Local, state, and national regulatory activities

                                        4

<PAGE>

                                                             EXHIBIT 2.1(a)(iii)

                                 SHARED SERVICES

FACILITIES MANAGEMENT.

         Facilities Project Management.

         -        Scope development

         -        Cost and schedule estimation

         -        Design and engineering contract documents

         -        Construction management services

         -        Employee relocation

         -        Furniture acquisition and relocation

         -        Cost tracking and reporting services

         Building Operations.

         -        Janitorial services

         -        Utility services

         -        Building repairs and maintenance

         -        Employee relocations and moves

         -        General operating requirements

         Real Estate.

         -        Facilities Management coordinates the sale of surplus
                  properties, the acquisition of properties and lease
                  negotiations

FINANCIAL SERVICES.

         Payroll Services.

         -        Issue regular payroll checks

         -        Issue special payroll checks

         -        Issue cash advances

         -        Process employee per diem expense reimbursements

         -        Process travel reimbursements

         -        Process educational assistance payments

         -        Process relocation allowances

         -        Comply with union agreements

         -        Prepare and file payroll related tax returns

         -        Issue employee W-2 forms and certain non-employee 1099s

         -        Maintain payroll records

         -        Provide litigation and audit support

         -        Comply with all payroll related reporting requirements

                                        1

<PAGE>

         -        Provide requested client support

         Remittance Processing Services

         -        Receive and initiate bank deposits for customer payments

         -        Prepare incoming mail for processing

         -        Capture data image and perform data entry of payment
                  information

         -        Initiate transmission of data to the host mainframe for
                  customer payment update

         -        Provide support for all electronic payments

         -        Perform image archiving of stubs and checks

         -        Process returned checks

         -        Provide customer/vendor interaction and resolution of payments

         -        Return correspondence sent in with customer payments to
                  central point at each business unit

         -        Perform timely reconciliation of general ledger accounts

         -        Collect and return to business unit the generated forms
                  soliciting customer participation in special programs (i.e.
                  Bank Drafts Balanced Billing, Good Neighbor, etc) which
                  customer returns with payment

         Check Disbursement Services.

         -        Printing of checks on standard check stock

         -        Inserting checks into a standard envelope

         -        Providing separate check inserts for up to two preapproved
                  standard inserts

         -        Sorting checks for distribution and delivery to mail room

         -        Maintenance of check printing control log

         -        Processing and posting of returned checks

         -        Investigation of fraudulent checks

         -        Processing exception items to the bank positive pay file

         Corporate Bank Reconciliation.

         -        Timely reconciliation of General Ledger cash accounts to bank
                  account balances

         State Escheat Reporting.

         -        State escheat reporting including notification letters and
                  required reporting. Maintenance of third party software and
                  database required for escheat reporting

         Corporate Travel Services.

         Professional business travel and off site meeting services, including:

                                        2

<PAGE>

         -        Air, hotel and car reservations

         -        Performs other travel support such as visa and passport
                  services

         -        Offers various alternatives for communicating travel requests
                  (telephone, fax, e-mail and self booking tools)

         -        Provides training / tips and support in making travel
                  arrangements

         -        Provides professional meeting planner to assist in
                  arrangements including facilities, audio-visual equipment,
                  catering, meeting logistics & contract negotiations

         Business Consulting.

         Financial Services provides business consulting services on request at
         hourly billing rates. Services can include client satisfaction program
         assistance, focus group facilitation, and new business services.

OFFICE SUPPORT SERVICES.

         Mail Services.

         -        Routing and delivery of interoffice mail, U.S. mail, certified
                  mail and overnight mail (FedEx, UPS, Airborne)

         -        Mail metering; maintenance of PO boxes and postal permits

         -        Consulting on Company and U. S. Postal Service processes and
                  requirements

         -        Daily pick-up and delivery for CenterPoint locations

         Graphics

         -        Original graphic design and production services for brochures,
                  newsletters, monthly publications, posters, invitations,
                  calendars, quarterly reports, annual reports, and icons/logos

         -        Original illustrations or photography as needed to support
                  design projects

         -        Original design and production of signage and banners

         -        Original Web page design and production

         -        Trade show display and promotional pieces

         -        Project research and strategy planning

         -        Consulting and project coordination

         -        Research and maintenance of image library to support design
                  projects

         Office Supplies.

         Product evaluations; participation in product procurement; maintenance
         of standard (stock) supply lists; product delivery for standard and
         non-standard supplies; and vendor liaison activities.

         Forms

         -        Forms analysis

                                        3

<PAGE>

         -        Business unit consulting and support for forms
                  preparation/forms needs Forms design for new and revised forms

         -        Maintenance of forms inventory levels, production and
                  distribution

         -        Participation in negotiation and maintenance of vendor
                  contracts

         -        Forms delivery via vendor to site, desktop delivery or LAN
                  distribution

         -        Maintenance of PowerForms software including strategic
                  direction, training, and business unit support

         Insert Operations

         -        Insert and mail customer bills and other high volume mailings
                  using high speed inserting equipment

         -        Order and stock customer bill envelopes and other envelopes as
                  requested by clients

         -        Obtain/maintain lowest applicable postage rate for mailings

         -        Maintain U.S. Postal Service postage payment account

         -        Meet all U.S. Postal Service preparation requirements for high
                  volume mailers

         -        Maintain documentation required to support high volume
                  mailings for Postal discount

         -        Provide consultation on Company and U.S. Postal Service
                  requirements for mailings

         Document Center.

         -        High speed duplicating

         -        Network publishing

         -        Mainframe and variable print with postal discount capability

         -        Color copying

         -        Engineering maps reproduction

         -        Full bindery/finishing

         -        Consulting and support on document preparation and printing
                  requirements.

         -        Brochures

         -        Newsletters

         -        Monthly publication

         -        - Forms

         -        - Envelopes

         -        - Marketing and promotional pieces

         -        - Invitations

         -        Business cards

         -        Letterheads

         -        Calendars

                                        4

<PAGE>

         -        Annual reports

         Convenience Copiers

         -        Arrange acquisition and maintain low-volume capacity copiers
                  in various locations for the convenience of business units
                  (client pays directly for copier)

         -        Administer copier contract and ensure contract compliance

         -        Perform needs analysis for business unit equipment and
                  consulting on relocations, removals, upgrades or downgrades,
                  and new products

         -        Provide ongoing product evaluations

         -        Communicate status of equipment acquisitions, removal, etc.

         -        Maintain accurate equipment inventory and volume records

         Records Management

         -        Provide storage options for clients files through contract
                  with third party provider

         -        Coordinate Retrieval of boxes / files for client review

         -        Develop and maintain a retention schedule that meets
                  operational and legal requirements

         -        Provide notification when files reach scheduled destruction
                  date and acquires appropriate documentation to destroy records

         -        Provide training and business unit support to evaluate file
                  storage options

PROCUREMENT.

         Purchasing

         -        Establish and maintain vendor agreements

         -        Provide IT procurement support - software and license

         -        Manage the vendor base and measures vendor performance

         Logistics

         -        Coordinate waste disposal with third party vendor, including
                  disposal of hazardous wastes and PCBs (clients direct billed
                  by vendor for third party services)

         -        Provide material handling and transportation services to
                  position hazardous waste for shipment to disposal facilities

         -        Manage disposal contractor services

         -        Coordinate collection and classification of trash and waste
                  for appropriate disposal through third party contract (clients
                  direct billed by vendor for third party services)

         -        Schedule pick up of trash containers and process documents for
                  payment

         -        Prepare trash disposal manifests as necessary

                                        5

<PAGE>

         Accounts Payable Automated Feed.

         -        Oversee automated feeds of payment requests for goods and
                  services in the Accounts Payable system and provide
                  reconciliation

         -        Correct automated entry rejects

         Accounts Payable Automated ERS/EDI.

         -        Oversee automated entry of invoices into the Accounts Payable
                  system via purchase order evaluated receipt settlement and
                  electronic data interchange

         Accounts Payable Manual Invoice Processing.

         -        Process invoices manually into the Accounts Payable system

         -        Perform account code validation

         -        Validate and identify material codes

         -        Confirm to Purchase Order

         -        Prepare correcting journal entries for Accounts Payable
                  transactions

         -        Image records and supporting documentation via FileNet for all
                  non-automated invoices to support records retention and
                  retrieval

         Accounts Payable Manual Invoice Processing without imaging.

         -        Process invoices manually into the Accounts Payable system

         -        Perform account code validation

         -        Validate and identify material codes

         -        Confirm to Purchase Order

         -        Prepare correcting journal entries for Accounts Payable
                  transactions

         Accounts Payable Ancillary.

         -        Vendor file maintenance

         -        Check processing activities

         -        State escheat process

         -        Returned check process

         -        Bank stop-payment activities

         -        Control report monitoring and correction

         -        Interactive Voice Response system maintenance

         -        Form 1099 tax reporting

         -        General ledger account reconciliation

         -        FileNet imaging system maintenance

         -        Production of on-demand standard Accounts Payable reports

         -        Monitoring procurement card exception reports

         -        Reconciliation of procurement card activity

                                        6

<PAGE>

         -        Coordination of year-end invoice accrual process

         -        Requested Accounts Payable workshops and training

         Accounts Payable Ancillary without imaging.

         -        Vendor file maintenance

         -        Check processing activities

         -        State escheat process

         -        Returned check process

         -        Bank stop payment activities

         -        Control report monitoring and correction

         -        Interactive Voice Response system maintenance

         -        Form 1099 tax reporting

         -        General ledger account reconciliation

         -        Production of on-demand standard Accounts Payable reports

         -        Monitoring procurement card exception reports

         -        Reconciliation of procurement card activity

         -        Coordination of year-end invoice accrual process

         -        Requested Accounts Payable workshops and training

         Accounts Payable Emergency Checks.

         -        Process invoices manually into the Accounts Payable system

         -        Perform account code validation

         -        Validate and identify material codes

         -        Perform vendor file maintenance (as required)

         -        Image records and supporting documentation via FileNet to
                  support records retention and retrieval

         -        Oversee manual check generation and distribution

         Inventory Accounting.

         -        Reconcile inventory accounts within the Accounts Payable
                  system.

         -        Assist in audit of inventory controls and inventory levels

         Supplier Diversity

         -        Manage the GSA Subcontracting Plan and the Five-Year Plan
                  Procurement Initiatives

         -        Monitor MWBE procurement processes and procedures and
                  associated results

         -        Respond to Federal, State, and Local
                  reports/filings/issues/concerns/requests

         -        Plan and implement internal/external training, workshops,
                  networking, and recognition events

                                        7

<PAGE>

         -        Implement, evaluate, and monitor Second-Tier expectations and
                  requirements

         -        Participate in MWBE outreach and development activities

         -        Coordinate internal Advisory Council

         -        Assist clients with bids requiring MWBE participation/Update
                  and enhance MWBE database

         -        Liaison to political, business, and community organizations
                  and councils with strong interest in supplier diversity

         -        Publicize and communicate supplier diversity emphasis &
                  awareness internally/externally

CORPORATE SECURITY

         -        Provide services necessary to plan and implement physical
                  security measures for the protection of Reliant Energy
                  personnel and assets

         -        Manage work requirements for contracted security personnel
                  including contracted guard services and off-duty police
                  officers

         -        Plan, coordinate installation and monitor electronic security
                  systems

         -        Develop and maintain security policies and site security
                  procedures, including periodic assessments for compliance and
                  functionality

         -        Provide security support for employees traveling or residing
                  outside the U.S.

         -        Perform confidential investigative services

         -        Provide pre-employment verification

ADMINISTRATIVE SUPPORT.

         Business Services.

         -        Shared Services budgeting and planning functions

         -        Creation, maintenance and reporting for the client
                  satisfaction programs

         -        Coordination and compilation of benchmarking/outsourcing
                  studies

         -        Special projects/reports

                                        8

<PAGE>

                                                             EXHIBIT 2.7(b)(iii)

                                 SHARED SERVICES
                        TERMINATION NOTIFICATION PERIODS

SHARED SERVICES

<TABLE>
<CAPTION>
TYPE OF SERVICE                                        TERMINATION PERIOD
<S>                                                    <C>
FACILITIES MANAGEMENT
1. Facilities Project Management                       Same as building lease
2. Building Operations                                 Same as building lease
3. Real Estate                                         60 days or end of third party broker agreement

FINANCIAL ADMINISTRATION
1. Payroll                                             120 days
2. Remittance Processing                               120 days
3. Check Disbursement                                  120 days
4. Corporate Bank Reconciliation                       60 days
5. Travel                                              90 days

OFFICE SUPPORT SERVICES
1. Office Mail Services                                Same as building lease
2. Insert Operations                                   120 days
3. Graphics                                            60 days
4. Office Supplies                                     60 days
5. Forms                                               60 days
6. Document Center                                     60 days
7. Convenience Copiers                                 60 days
8. Appliance Sales                                     60 days
9. Records Management                                  120 days

PROCUREMENT
1. Purchasing                                          90 days
2. Logistics                                           90 days
3. Accounts Payable Automated                          120 days
4. Accounts Payable Manual                             120 days
5. Investment Recovery                                 90 days
6. Waste Disposal                                      90 days
7. Rubber Goods                                        90 days
8. Trash Disposal                                      90 days

CORPORATE SECURITY
1. Security Services                                   90 days (or same as building lease)

ADMINISTRATIVE SUPPORT
1. Support Charges                                     function of other services
</TABLE>

Note: Current estimate of lease expiration at Reliant Energy Plaza is December
2004.

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