UIL HOLDINGS CORP
1ST AMEND-PHAN.STK OPT PLAN-N. WOODSON & UI
<DOCUMENT>
<TYPE>EX-10.21B
<SEQUENCE>5
<FILENAME>0005.txt
<DESCRIPTION>1ST AMEND-PHAN.STK OPT PLAN-N. WOODSON & UI
<TEXT>

                                                            EXHIBIT 10.21b




              FIRST AMENDMENT TO THE UNITED ILLUMINATING COMPANY
                       PHANTOM STOCK OPTION AGREEMENT


     This FIRST  AMENDMENT,  made as of the close of business on the 20th day of
July,  2000, to the Phantom Stock Option  Agreement,  made as of the 23rd day of
February,  1998, (the "Agreement")  between THE UNITED  ILLUMINATING  COMPANY, a
Connecticut   corporation,   (the  "Company")  and  NATHANIEL  D.  WOODSON,   an
individual, (the "Executive"),

                                 WITNESSETH THAT:

(1)  The Company and the  Executive  hereby agree to amend the  Agreement as set
     forth in Sections (2) and (3) below.

(2)  Section 3 is amended to read as follows:

     3. Payment Upon  Exercise.  On each date that the Executive or his personal
        ----------------------
     representative  exercises  one or more  Options,  the Company  shall become
     obligated to pay the Executive or his personal representative,  in cash, an
     amount  equal to the excess of the fair market value of the Common Stock of
     UIL Holdings  Corporation on that date over the Exercise Price,  multiplied
     by the  number of  options  exercised.  "Fair  market  value"  shall be the
     average of the high and low sale  prices of shares of the  Common  Stock of
     UIL Holdings  Corporation on the New York Stock Exchange  composite tape on
     the exercise  date or, if there is no sale on such date,  then such average
     price on the last  previous  day on which at least one sale shall have been
     reported.  The Company  shall  discharge  each  payment  obligation  to the
     Executive or his personal  representative  on or before the second business
     day following the exercise date.

(3)  Section 6 is amended to read as follows:

     6. Adjustments. In the event of a recapitalization, reclassification, stock
        -----------
     split,  stock dividend,  combination of shares, or any other similar change
     in the  capital  structure  of UIL  Holdings  Corporation,  an  appropriate
     adjustment shall be made in the number and or kind of shares covered by the
     Options  and/or in the Exercise  Price of the Options.  In the event of any
     merger,  consolidation or other  reorganization in which the Company is not
     the  surviving or continuing  corporation,  all Options shall be assumed by
     the surviving or continuing corporation.

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(4)  All the terms and conditions of the Agreement,  as amended hereby,  are and
     shall remain in full force and effect.

(5)  This  First  Amendment  to the  Agreement  may be  executed  in one or more
     counterparts,  each of which shall be deemed an  original  but all of which
     together shall constitute one in the same instrument.

         IN WITNESS WHEREOF, the parties hereto have executed this instrument as
of the day and year first above written.

THE UNITED ILLUMINATING COMPANY            ATTEST:



By  /s/ Albert N. Henricksen                 /s/ Susan E. Allen
    ----------------------------      -------------------------------------
    Albert N. Henricksen                         Susan E. Allen
    Its Group Vice President          Its Vice President Investor Relations
    Support Services                  and Corporate Secretary




    /s/ Nathaniel D. Woodson
    ----------------------------
        Nathaniel D. Woodson



                                       2

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</DOCUMENT>
