EXHIBIT 10.38a

FIRST AMENDMENT
TO
EMPLOYMENT AGREEMENT

THIS AMENDMENT ( the “First Amendment”) is made as of the 18 day of November
2004, between The United Illuminating Company, a Connecticut Corporation (the
“Company”) and Richard J. Reed (the “Executive”),

WITNESSETH THAT

WHEREAS, the Company previously entered into an amended and restated employment
agreement with the Executive dated as of March 26, 2004 (the “Employment
Agreement”); and

WHEREAS, the Company and the Executive desire to further amend the Employment
Agreement by this First Amendment, effective as of November 18, 2004, to reflect
certain changes to the severance provisions under the Employment Agreement and
to make two other clarifying revisions to the Employment Agreement;

NOW THEREFORE, the following Sections of the Agreement are hereby amended as
follows:

1.            The first sentence of Section 1(b) of the Agreement is revised to
read as follows:

The term of this Agreement shall be for a period commencing on the date hereof
and ending on the second anniversary of the date hereof, unless this Agreement
is earlier terminated as provided in Section 5 (the “Initial Term”).

2.            Section 6(a)(i) is revised to read as follows:

(i) The Executive’s Base Salary, earned but unpaid as of the Date of
Termination, and Accrued Incentive Compensation (as defined in Section 4(b));

3.            Section 6(c)(iv)(2), which describes, in part, the severance that
the Executive is entitled to upon a termination without cause is hereby revised
to read as follows:

 
(2) the short-term annual incentive compensation payment to which the Executive
would be entitled, calculated as if he had been employed by the Company on the
last day of the year of his termination, as if both personal goals and Company
goals had been achieved ‘at target’, without pro-ration for the fact that the
Executive was employed only a portion of such year.  Except for the assumption
that such goals shall have been achieved at target, personal and Company goals
shall be defined and determined as set forth in Section 4(b) of this Agreement.

 
 

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All of the other terms and conditions of the Employment Agreement shall remain
in full force and effect.

                                       THE UNITED ILLUMINATING COMPANY

Attest:

/s/ Susan E. Allen
 
By
/s/ Nathanial D. Woodson
Susan E. Allen
   
Nathanial D. Woodson
UIL Vice President Investor Relations
   
Its Chief Executive Officer
Corporate Secretary & Assistant Treasurer
                           
/s/ Richard J. Reed
     
Richard J. Reed

 
 

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