EXHIBIT 10.1 CENTERPOINT ENERGY, INC. LONG-TERM INCENTIVE PLAN NONQUALIFIED STOCK OPTION AWARD AGREEMENT

<PAGE>

                                                                    EXHIBIT 10.1

                            CENTERPOINT ENERGY, INC.

                            LONG-TERM INCENTIVE PLAN

                    NONQUALIFIED STOCK OPTION AWARD AGREEMENT

            Pursuant to this Award Agreement, CENTERPOINT ENERGY, INC. (the

"Company") hereby grants to [NAME] (the "Optionee"), an employee of the Company,

on [GRANT DATE] (the "Grant Date"), a right (the "Option") to purchase from the

Company [NUMBER] shares of Common Stock of the Company at $[OPTION STRIKE PRICE]

per share (the "Exercise Price"), pursuant to the Long-Term Incentive Plan of

CenterPoint Energy, Inc. (the "Plan"), with such number of shares and such price

per share being subject to adjustment as provided in Section 14 of the Plan, and

further subject to the following terms and conditions:

            1. RELATIONSHIP TO THE PLAN; DEFINITIONS.

            This Option is subject to all of the terms, conditions and

provisions of the Plan and administrative interpretations thereunder, if any,

which have been adopted by the Committee thereunder and are in effect on the

date hereof. Except as defined herein, capitalized terms shall have the same

meanings ascribed to them under the Plan. To the extent that any provision of

this Award Agreement conflicts with the express terms of the Plan, it is hereby

acknowledged and agreed that the terms of the Plan shall control and, if

necessary, the applicable provisions of this Award Agreement shall be hereby

deemed amended so as to carry out the purpose and intent of the Plan. References

to the Optionee herein also include the heirs or other legal representatives of

the Optionee. For purposes of this Award Agreement:

            "DISABILITY" means a physical or mental impairment of sufficient

      severity such that the Optionee is both eligible for and in receipt of

      benefits under the long-term disability provisions of the Company's

      benefit plans.

            "EMPLOYMENT" means employment with the Company or any of its

      Subsidiaries.

            "OPTION PERIOD" means the period commencing upon the Optionee's

      receipt of this Award Agreement and ending on the date on which the Option

      expires pursuant to Section 3(a).

            "OPTION SHARES" means the shares of Common Stock covered by this

      Award Agreement.

                                       1

<PAGE>

            "RETIREMENT"  means termination of Employment on or after attainment

      of age 55 and with at least five years of service with the Company.

            2. EXERCISE AND VESTING SCHEDULE.

            (a) This Option shall