Exhibit
10.39


AMENDMENT
NO. TWO

TO THE

UNIVERSAL COMPRESSION HOLDINGS, INC.

EMPLOYEE STOCK PURCHASE PLAN


ARTICLE
I

PURPOSE


1.01    Purpose.    The
Universal Compression Holdings, Inc. Employee Stock Purchase Plan (the “Plan”),
was adopted by the Board of Directors to encourage employees of Universal
Compression Holdings, Inc. (“Universal”) to remain in its employ and
participate in its growth by providing a method whereby employees of Universal
and its eligible Subsidiary Corporations (collectively, with Universal, the “Company”)
will have an opportunity to acquire a proprietary interest in the Company’s
long-term performance and success through the purchase of shares of the Common
Stock at a price that may be less than the fair market value of the stock on the
date of purchase from funds accumulated through payroll deductions. It is the
intention of the Company to have the Plan qualify as an “employee stock
purchase plan” under section 423 of the Internal Revenue Code of 1986, as
amended (the “Code”). The provisions of the Plan shall be construed so as to
extend and limit participation in a manner consistent with the requirements of
that section of the Code. The Plan as originally adopted reflected that Two
Hundred Fifty Thousand (250,000) shares of Common Stock were available for
purchase pursuant to the Plan. The Company now amends and restates the Plan
effective as of April 19, 2006, to reflect that an additional Two Hundred
Fifty Thousand (250,000) shares of Common Stock will be available for purchase
pursuant to the Plan.


ARTICLE
II

DEFINITIONS


2.01 “Board”
means the Board of Directors of Universal.


2.02 “Common
Stock” means the Common Stock, $0.01 par value, of Universal.


2.03 “Committee”
means the committee appointed by the Board pursuant to Article X to
administer the Plan. If the Board does not appoint a Committee, or if a
Committee otherwise fails to exist at any time during the term hereof, the
Board shall perform the functions of the Committee.


2.04 “Eligible
Pay” means regular straight-time earnings, including commissions, but excluding
payments for overtime, shift premium, bonuses and other incentive and special
payments.


2.05 “Employee”
means any person who is customarily employed, within the meaning of Code
section 3401, by the Company (i) more than 20 hours per week or
(ii) at least five months in any calendar year. The Committee shall
determine when an Employee’s period of employment terminates and when such
period of employment is deemed to be continued during an approved leave of
absence.


2.06 “Offering”
means any offering as described in Section 4.02 hereof permitting
Participants to purchase Common Stock under the Plan.


2.07 “Offering
Commencement Date” means the date on which an Offering will commence, as
described in Section 4.02.


2.08 “Offering
Period” means the period between the Offering Commencement Date and the
Offering Termination Date, as described in Section 4.02.


2.09 “Offering
Termination Date” means the last day of an Offering Period, as described in
Section 4.02.



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2.10 “Participant”
means an Employee who exercises an option to purchase Common Stock under the
Plan by authorizing payroll deductions under Section 5.02.


2.11 “Plan”
means the Universal Compression Holdings, Inc. Employee Stock Purchase
Plan, as set forth herein and as it may be amended from time to time.


2.12 “Subsidiary
Corporation” means (i) any “subsidiary corporation” of Universal as that
term is defined in section 424(f) of the Code, (ii) any other entity
that is taxed as a corporation under Code Section 7701(a)(3) and is a
member of the “affiliated group” as defined in Code Section 1504(a) of
which Universal is the common parent, and (iii) any other entity as may be
permitted from time to time by the Code or the Internal Revenue Service to be
an employer of employees participating in the Plan; provided, however, that any
such Subsidiary Corporation must be designated as a participating employer in
the Plan by the Board.


ARTICLE
III

ELIGIBILITY AND PARTICIPATION


3.01    Initial Eligibility.    Except
as provided in Section 3.02, any Employee who shall have completed ninety
(90) days’ employment and shall be employed by the Company on the date his
participation in the Plan is to become effective shall be eligible to
participate in Offerings under the Plan which commence on or after such
ninety-day period has concluded.


3.02    Restrictions on
Participation.    Notwithstanding any provisions
of the Plan to the contrary, no Employee shall be granted an option to purchase
Common Stock under the Plan:


(a)   if,
immediately after the grant, such Employee would own stock, and/or hold
outstanding options to purchase stock, possessing 5% or more of the total
combined voting power or value of all classes of stock of the Company (for
purposes of this subparagraph, the rules of section 424(d) of the Code
shall apply in determining stock ownership of any Employee) and any option
granted to an Employee which results in his stock ownership (as determined
under section 423(b)(3) of the Code) equaling or exceeding such 5% limitation
shall be entirely void as if it had never been granted; or


(b)   which
permits his rights to purchase stock under all employee stock purchase plans of
the Company to accrue at a rate which exceeds $25,000 in fair market value of
the stock (determined at the time such option is granted) for each calendar
year in which such option is outstanding. For purposes of this subparagraph
(b), (i) an option accrues when the option first becomes exercisable
during any calendar year; (ii) an option accrues at a rate provided in the
applicable Offering, but in no case may such rate for any Employee exceed
$25,000 of the fair market value of stock determined at the time the option is
granted for any one calendar year; (iii) an option that has accrued under
any one Offering may not be carried over by a Participant to any other
Offering; and (iv) only rights to purchase stock that have been granted
under an employee stock purchase plan that complies with section 423 of
the Code shall be taken into account.


3.03    Commencement of Participation.    An
eligible Employee may become a Participant by completing an authorization for a
payroll deduction in accordance with Section 5.02 on the form provided by
the Company and filing it with the Company’s finance department on or before
the date set therefore by the Committee, which date shall be prior to the
Offering.


ARTICLE
IV

OFFERINGS


4.01    Shares Offered.    The
total number of shares of Common Stock available under the Plan is Five Hundred
Thousand (500,000) shares. If any Offering shall expire without the rights
under such Offering having been exercised in full, such unpurchased shares
covered thereby shall be added to the shares otherwise available for future
Offerings.


4.02    Offerings.    The
Company may make periodic Offerings to eligible employees to purchase 



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Common Stock under the
Plan, the duration of which may be for a period of three months up to one year;
provided, however, that the initial Offering Commencement Date may be for a
period of less than three months, as determined by the Committee. Offering
Periods commencing after the initial Offering Period will commence on
January 1, April 1, July 1 or October 1. With respect to
each Offering, the Committee, at its discretion, may specify the maximum number
of shares of Common Stock that may be purchased under the Offering or such
other limitations that it may deem appropriate. The number of shares of Common
Stock that may be purchased under each successive Offering shall be all or a
portion of the balance of the Five Hundred Thousand (500,000) shares authorized
but not purchased previously under the terms of this Plan.


As used in the
Plan, “Offering Commencement Date” means the January 1, April 1,
July 1 or October 1, as the case may be, on which the particular
Offering begins. “Offering Termination Date” means the March 31,
June 30, September 30 or December 31, as the case may be, on
which the particular Offering terminates, and “Offering Period” means the
period from the Offering Commencement Date to the Offering Termination Date.


ARTICLE
V

PAYROLL DEDUCTIONS


5.01    Offering Rights.    With
respect to each Offering, each Employee shall be offered the opportunity to
elect to have deducted from each paycheck issued during the Offering Period an
amount as determined by the Participant which shall be withheld by the Company
for the purchase on behalf of such electing Employee of the number of whole
shares of Common Stock that can be purchased with the amount deducted for such
purpose, but in no event may the number of whole shares which may be purchased
by any Participant exceed the number of whole shares available during the
Offering Period or exceed the individual Participant allotment, if any, for the
Offering Period described in Section 6.03 hereof. Fractional shares may
not be purchased; any funds that are insufficient to purchase whole shares
shall remain in each affected Participant’s Plan account until the following
Offering Period, at which time such funds shall be (i) combined with the
Participant’s payroll deduction for the following Offering Period and used to
purchase whole shares for each affected Participant who remains eligible to
participate in such Offering Period, or (ii) returned to each affected
Participant who is not eligible to participate in the following Offering
Period.


5.02    Payroll Deductions.    Each
Employee shall become a Participant pursuant to the terms of an Offering by
filing a written election to participate in that Offering in the form of a
payroll deduction authorization prior to the Offering Commencement Date on the
form provided by the Company for that purpose. A Participant may elect to have
his authorization continue for future Offerings until revoked or modified in
writing. A Participant may elect to have deductions made from his pay in one of
two ways. At the time a Participant files his authorization for payroll
deduction, he shall elect to have deductions made from his pay on each payday
during the time he is a Participant in an Offering at the rate of any specified
whole percentage from 1% up to and including 10% of his Eligible Pay in effect
at the Offering Commencement Date or the Participant shall elect to have a
specific dollar amount deducted from his pay on each payday during the time he
is a Participant pursuant to rules that may be proscribed from time to time by
the Committee; provided, however, that each payroll deduction shall be in an
amount not less than $20 per payroll period and shall be subject to the
restrictions contained in Section 3.02. In the case of a part-time hourly
Employee, such Employee’s Eligible Pay during an Offering shall be determined
by multiplying such Employee’s hourly rate of pay in effect on the Offering
Commencement Date by the number of regularly scheduled hours of work for such
Employee during such Offering. Payroll deductions shall commence with the first
regular payroll period coinciding with or ending on the Offering Commencement
Date, or at such other time as may be specified in such Offering and shall end
on the earlier of the last regular payroll period coinciding with or ending
before the Offering Termination Date or, if earlier, upon the termination of
the Participant’s employment with the Company.


5.03    Method of Payment;
Participant’s Account.    The Company will
maintain or cause to have maintained a Plan account on its books in the names
of each Participant. All payroll deductions made for a Participant shall be
credited to his account under the Plan. Purchases of shares of Common Stock by
any 



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Participant pursuant to
an Offering shall be made with funds accumulated in the Participant’s account
through payroll deductions from the Participant’s Eligible Pay during the
Offering Period. A Participant may not make any separate cash payment into such
account except when on leave of absence and then only as provided in
Section 5.05. The Company shall not credit a Participant’s Plan account
with interest on any payroll deduction.


5.04    Changes in Payroll
Deductions.    A Participant may discontinue his
participation in the Plan as provided in Article VII, but no other change
can be made during an Offering and, specifically, a Participant may not alter
the amount of his payroll deductions for that Offering.


5.05    Leave of Absence.    If
a Participant goes on a leave of absence, such Participant shall have the right
to elect (i) to withdraw the balance in his Plan account pursuant to
Article VII, (ii) to discontinue contributions to the Plan but remain
a Participant in the Plan, or (iii) to remain a Participant in the Plan during
such leave of absence, authorizing deductions to be made from payments by the
Company to the Participant during such leave of absence and undertaking to make
cash payments to the Plan at the end of each payroll period to the extent that
amounts payable by the Company to such Participant are insufficient to meet
such Participant’s authorized Plan deductions.


ARTICLE
VI

TERMS AND CONDITIONS OF OFFERINGS AND OPTIONS


6.01    Terms and Conditions.    Except
as provided in Section 3.02(b), all Participants shall have the same rights
and privileges, as specified below in this Article VI.


6.02    Number of Option Shares.    On
each Offering Commencement Date, a Participant shall be deemed to have been
granted an option to purchase shares of Common Stock of the Company equal to
the percentage of the Employee’s Eligible Pay that he has elected to have
withheld through payroll deductions multiplied by the Employee’s Eligible Pay
during the Offering Period, or the specified portion elected, divided by the
purchase price per share determined under Section 6.04, subject to the
allotments, if any, for the Offering Period described in Section 6.03.


6.03    Allotment of Shares.    If
the total number of shares of Common Stock to be purchased by Participants
through payroll deduction under any Offering exceeds the shares available for
purchase under the Offering, the Committee may make allotments of shares among
the Participants on any basis consistent with the terms of the Plan, and
Offerings for shares, if any, in excess of the shares so allotted shall be
deemed to have lapsed. Any funds remaining in a Participant’s account after an
Offering as a result of this Section 6.03 shall be carried over into the
next Offering, or shall be returned to the Participant as soon as practicable
if another Offering will not occur or if the Employee does not elect to
participate in the next Offering.


6.04    Purchase Price.    The
purchase price per share at which Common Stock may be purchased under each
Offering shall be a percentage established by the Committee prior to the
Offering Commencement Date which is from 85% to 100% of the lesser of the fair
market value of a share of Common Stock as determined as of (i) the
Offering Commencement Date or (ii) the Offering Termination Date. In
determining the purchase price, the fair market value per share of Common Stock
shall be the closing price reported, if any, on the New York Stock Exchange or
successor exchange or market system for the date on which such value is being
determined; provided, however, that if the closing sales price is not reported
on such date, then the closing price on the most recently preceding date on
which such price was reported shall be used. If no trading market on the New
York Stock Exchange exists, the Board of Directors or the Committee shall
determine the fair market value for this purpose.


6.05    Nontransferability of
Options.    An option shall not be transferable
by the Employee or Participant to whom it has been granted otherwise than by
will or the laws of descent and distribution and shall be exercisable, during
the Participant’s lifetime, only by the Participant. Further, in the discretion
of the Board, the terms of any Offering may prohibit transfer under any
circumstances and provide for cancellation of the unexercised portion of any
option upon the death of a Participant.



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6.06    Purchases.    As
of the Offering Termination Date, or such other date as required by
administrative operational requirements, purchases of shares of Common Stock by
any Participant pursuant to an Offering shall be made with funds accumulated in
the Participant’s account through payroll deductions from the Participant’s pay
or as otherwise permitted by the Board, under rules of uniform application over
the time period specified in such Offering.


6.07    Other Provisions.    Each
Offering shall contain such other provisions as the Committee shall deem
advisable, including restrictions on resale of Common Stock purchased through
an Offering, provided that no such provisions may in any way conflict, or be inconsistent
with the terms of the Plan as amended from time to time.


6.08    Requirements of Law.    The
issuance of any Common Stock hereunder is conditioned upon registration or
exemption of the Common Stock to be issued under applicable federal and state
securities laws and its listing on any applicable stock exchange. In no event
shall any Common Stock be issued hereunder prior to the effective date of any
such registration, exemption or listing application. In addition, unless and
until the Plan is approved by a proper vote of the stockholders of Universal,
the purchase price per share under Section 6.04 shall be at least 100% of
the fair market value determined thereunder.


6.09    Issuance of Common Stock.    The
shares of Common Stock purchased by each Participant with respect to each
Offering shall be considered to be issued and outstanding to his credit as of
the close of business on the Offering Termination Date or other purchase date
for the Offering as described in Section 6.06. Certificates for shares of
Common Stock shall be issued in accordance with Section 7.02 only in the
name of the Participant unless the Participant, or in the event of death, the
Participant’s designee, elects otherwise by written notice to the Company and
the Company gives prior written consent to such election.


6.10    Account Balances.    No
interest shall accrue at any time for any amount credited to the account of a
Participant. After the close of each Offering, a report shall be sent to each
Participant stating the entries made to his account, the number of shares of
Common Stock purchased, and the applicable purchase price of such shares.


ARTICLE
VII

WITHDRAWALS FROM PARTICIPANT ACCOUNTS


7.01    Withdrawal From Offering.    Except
for any officer of the Company who is subject to the reporting requirements of
Section 16(a) of the Securities Exchange Act of 1934, as amended (an “Insider”),
any Participant may cease participation in an Offering at any time prior to the
Offering Termination Date and withdraw all cash amounts in his account by
providing at least fifteen (15) days’ prior written notice to the Company’s
human resource department revoking his payroll deduction authorization. Such
withdrawals shall serve to cancel the Participant’s option, and the Participant
shall thereupon cease his participation in such Offering. Partial cash
withdrawals shall not be permitted. Any cash withdrawal request shall be made
in such form and under such conditions as may be specified from time to time by
the Committee. Insiders may not make cash withdrawals for so long as they
remain Insiders.


7.02    Issuance of Certificates.    As
soon as practicable after each Offering Period, each Participant will receive a
stock certificate representing all of the shares of Common Stock (in a whole
number of shares) held in his account. Subject to Section 6.07, a
Participant shall not be permitted to pledge, transfer, or sell shares of
Common Stock held in his account until they are issued in certificate form.



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7.03    Termination of Employment.    Upon
termination of a Participant’s employment with the Company for any reason,
whether voluntary or involuntary, his participation in the Plan shall
immediately terminate. As soon thereafter as is practicable, the Participant,
or the Participant’s beneficiary in the event of the Participant’s death, shall
receive (i) cash in an amount equal to the balance in his account as of
the date of his termination of employment, without interest; (ii) a stock
certificate for all whole shares of Common Stock not yet delivered out of the
account; and (iii) cash equivalent to any fractional shares of Common
Stock in the account.


ARTICLE
VIII

RECAPITALIZATION OR REORGANIZATION

AND COMMON STOCK DIVIDENDS


8.01    Merger, Consolidation, or
Reorganization.    In the event of a dissolution
or liquidation of the Company, or any merger, consolidation, or share exchange
pursuant to which the holders of Common Stock would receive cash, securities or
property from another person or entity, the Board, at its election, may cause
each outstanding option to terminate; provided, however, that each Participant
shall in such event, subject to such rules and limitations of uniform
application as the Board may prescribe, be entitled to the rights of
terminating Participants provided in Article VII.


8.02    Capital Adjustments.    The
aggregate number of shares of Common Stock that may be purchased by the
exercise of outstanding options and the purchase price per share covered by
each such outstanding option and the number of shares of Common Stock held in a
Participant’s account shall be proportionately adjusted for any increase or
decrease in the number of issued shares resulting from a subdivision or
consolidation of Common Stock or other capital adjustment or the payment of a
Common Stock dividend or other increase or decrease in such shares of Common
Stock effected without the receipt of consideration by the Company.


8.03    Company’s Discretion.    The
grant of an option under the Plan shall not affect in any way the Company’s
right or power to make adjustments, reclassifications, reorganizations, or
changes of its capital or business or to merge, consolidate, dissolve,
liquidate, sell, or transfer all or any part of its business or assets.


ARTICLE
IX

AMENDMENT OR TERMINATION OF THE PLAN


9.01    Amendment or Termination.    The
Board in its sole and absolute discretion may suspend or terminate the Plan,
reconstitute the Plan in whole or in part, or amend or revise the Plan in any
respect whatsoever except that (i) no amendment shall cause any option to
fail to qualify as an option under section 423 of the Code;
(ii) without approval of the stockholders, no amendment shall increase the
number shares of Common Stock that may be sold under the Plan or make any
change in the Employees or class of Employees eligible to participate in the
Plan; and (iii) without the approval of a Participant, no change shall be
made in the terms of any outstanding option adverse to the interest of the
Participant. The Plan shall terminate on the date that all shares of Common
Stock authorized for sale under the Plan have been purchased, except as
otherwise extended by authorizing additional shares under the Plan.


ARTICLE
X

ADMINISTRATION


10.01    Appointment of Committee.    If
the Board appoints a Committee to administer the Plan, the Committee shall
consist of at least two directors of Universal. The Board may from time to time
appoint members of the Committee in substitution for or in addition to members
previously appointed and may fill vacancies, however caused, in the Committee.


10.02    Authority of Committee.    Subject
to the express provisions of the Plan, the Committee shall have full power and
authority in its discretion to interpret and construe any and all provisions of
the Plan, to adopt rules and regulations for administering the Plan, and to
make all other determinations deemed 



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necessary or advisable
for administering the Plan. The Committee’s determination on the foregoing
matters shall be final, conclusive and binding on all persons. The Committee may
delegate some or all of its administrative powers and responsibilities to such
other persons from time to time as it deems appropriate.


ARTICLE
XI

MISCELLANEOUS


11.01    Nontransferability.    Except
by the laws of descent and distribution, no benefit provided hereunder shall be
subject to alienation, assignment, or transfer by a Participant (or by any
person entitled to such benefit pursuant to the terms of this Plan), nor shall
it be subject to attachment or other legal process of whatever nature, and any
attempted alienation, assignment, attachment, or transfer shall be void and of
no effect whatsoever and, upon any such attempt, the benefit shall terminate
and be of no force or effect. During a Participant’s lifetime, options granted
to the Participant shall be exercisable only by the Participant. Shares of
Common Stock shall be delivered only to the Participant or death beneficiary
entitled to receive the same or to the Participant’s authorized legal
representative.


11.02    No Employment Right.    Neither
this Plan nor any action taken hereunder shall be construed as giving any right
to any individual to be retained as an officer or Employee of the Company.


11.03    Tax Withholding.    The
Company shall have the right to deduct from all payments hereunder any federal,
state, local, or employment taxes that it deems are required by law to be
withheld with respect to such payments.


11.04    Government and Other
Regulations.    The obligation of the Company to
deliver shares of Common Stock or make cash payments hereunder shall be subject
to all applicable laws, rules, and regulations and to such approvals by any
government agencies or regulatory authority as may be deemed necessary or
appropriate by the Committee. If shares of Common Stock deliverable hereunder
may in certain circumstances be exempt from registration under the Securities
Act of 1933, as amended, the Company may restrict its transfer in such manner
as it deems advisable to ensure such exempt status. The Plan is intended to
comply with Rule 16b-3 under the Securities Exchange Act of 1934, as
amended. Any provision inconsistent with such Rule shall be inoperative and
shall not affect the validity of the Plan. The Plan shall be subject to any
provision necessary to assure compliance with federal and state securities
laws.


11.05    Indemnification.    Each
person who is or at any time serves as a member of the Board and/or the
Committee shall be indemnified and held harmless by Universal against and from
(i) any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by such person in connection with or resulting from any
claim, action, suit, or proceeding to which such person may be a party or in
which such person may be involved by reason of any action or failure to act under
this Plan; and (ii) any and all amounts paid by such person in
satisfaction of judgment in any such action, suit, or proceeding relating to
this Plan except to the extent that any such loss, cost, liability or expense
arises from the gross negligence or willful misconduct of such person. Each
person covered by this indemnification shall give Universal an opportunity, at
its own expense, to handle and defend the same before such person undertakes to
handle and defend the same on such person’s own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification
to which such persons may be entitled under the charter or bylaws of Universal,
as a matter of law, or otherwise, or any power that Universal may have to
indemnify such person or hold such person harmless.


11.06    Reliance on Reports.    Each
member of the Board and the Committee shall be fully justified in relying or
acting in good faith upon any report made by the independent public accountants
of the Company and upon any other information furnished in connection with this
Plan. In no event shall any person who is or shall have been a member of the
Board and/or the Committee be liable for any determination made or other action
taken or any omission to act in reliance upon any such report or information,
or for any action taken, including the furnishing of information, or failure to
act, if in good faith.


11.07    Governing Law.    All
matters relating to this Plan shall be governed by the laws of the State 



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of Texas, without regard
to the principles of conflict of laws thereof, except to the extent preempted
by the laws of the United States.


11.08    Relationship to Other
Benefits.    No payment under this Plan shall be
taken into account in determining any benefits under any pension, retirement,
profit sharing, or group insurance plan of the Company.


11.09    Expenses.    The
expenses of implementing and administering this Plan shall be borne by the
Company.


11.10    Titles and Headings.    The
titles and headings of the Articles and Sections in this Plan are for
convenience of reference only, and in the event of any conflict, the text of
this Plan, rather than such titles or headings, shall control.


11.11    Application of Funds.    All
funds received by the Company under the Plan shall constitute general funds of
the Company.


11.12    Nonexclusivity of Plan.    Neither
the adoption of the Plan by the Board nor the submission of the Plan to the
stockholders of Universal for approval shall be construed as creating any
limitations on the power of the Board to adopt such other incentive
arrangements as it may deem desirable, including, without limitation, the
granting of stock options otherwise than under the Plan, and such arrangements
may be either applicable generally or only in specific cases.


Effective as of
April 19, 2006.


	
  

  	
   

  	
  UNIVERSAL COMPRESSION HOLDINGS, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ J. Michael Anderson

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
  J. Michael Anderson

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
  Senior Vice President and Chief Financial Officer

  



 



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