Document:

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                                                                    EXHIBIT 10.9

                             SUBSIDIARIES GUARANTY

                  SUBSIDIARIES GUARANTY, dated as of May 30, 2000 (as amended,
modified or supplemented from time to time, this "Guaranty"), made by each of
the undersigned guarantors (each a "Guarantor," and together with any other
entity that becomes a guarantor hereunder pursuant to Section 26 hereof, the
"Guarantors"). Except as otherwise defined herein, capitalized terms used herein
and defined in the Credit Agreement (as defined below) shall be used herein as
therein defined.

                              W I T N E S S E T H :
                              - - - - - - - - - -

                  WHEREAS, Universal Compression Holdings, Inc. ("Holdings"),
Universal Compression, Inc. (the "Borrower"), the lenders from time to time
party thereto (the "Lenders"), Deutsche Bank Securities Inc., as Lead Arranger,
and Bankers Trust Company, as Administrative Agent (together with any successor
administrative agent, the "Administrative Agent"), have entered into a Credit
Agreement, dated as of May 30, 2000, providing for the making of Loans to, and
the issuance of Letters of Credit for the account of, the Borrower as
contemplated therein (as amended, modified as supplemented from time to time,
the "Credit Agreement") (the Lenders, the Collateral Agent and the
Administrative Agent are herein called the "Lender Creditors");

                  WHEREAS, the Borrower may at any time and from time to time
enter into one or more Interest Rate Protection Agreements or Other Hedging
Agreements with one or more Lenders or any affiliate thereof (each such Lender
or affiliate, even if the respective Lender subsequently ceases to be a Lender
under the Credit Agreement for any reason, together with such Lender's or
affiliate's successors and assigns, if any, collectively, the "Other Creditors,"
and together with the Lender Creditors, the "Secured Creditors");

                  WHEREAS, each Guarantor is a direct or indirect Subsidiary of
the Borrower;

                  WHEREAS, it is a condition to the making of Loans to, and the
issuance of Letters of Credit for the account of, the Borrower under the Credit
Agreement that each Guarantor shall have executed and delivered this Guaranty;
and

                  WHEREAS, each Guarantor will obtain benefits from the
incurrence of Loans to, and the issuance of Letters of Credit for the account
of, the Borrower under the Credit Agreement and the entering into by the
Borrower of Interest Rate Protection Agreements or Other Hedging Agreements and,
accordingly, desires to execute this Guaranty in order to satisfy the conditions
described in the preceding paragraph;
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                  NOW, THEREFORE, in consideration of the foregoing and other
benefits accruing to each Guarantor, the receipt and sufficiency of which are
hereby acknowledged, each Guarantor hereby makes the following representations
and warranties to the Secured Creditors and hereby covenants and agrees with
each Secured Creditor as follows:

                  1. Each Guarantor, jointly and severally, irrevocably,
absolutely and unconditionally guarantees: (i) to the Lender Creditors the full
and prompt payment when due (whether at the stated maturity, by acceleration or
otherwise) of (x) the principal of and interest on the Notes issued by, and the
Loans made to, the Borrower under the Credit Agreement, and all reimbursement
obligations and Unpaid Drawings with respect to Letters of Credit issued under
the Credit Agreement and (y) all other obligations (including obligations which,
but for the automatic stay under Section 362(a) of the Bankruptcy Code, would
become due), liabilities and indebtedness owing by the Borrower to the Lender
Creditors under the Credit Agreement or any other Credit Document to which the
Borrower is a party (including, without limitation, indemnities, Fees and
interest thereon), whether now existing or hereafter incurred under, arising out
of or in connection with the Credit Agreement or any such other Credit Document
and the due performance and compliance by the Borrower with all of the terms,
conditions and agreements contained in the Credit Agreement and such other
Credit Documents (all such principal, interest, liabilities, indebtedness and
obligations being herein collectively called the "Credit Document Obligations");
and (ii) to each Other Creditor the full and prompt payment when due (whether at
the stated maturity, by acceleration or otherwise) of all obligations (including
obligations which, but for the automatic stay under Section 362(a) of the
Bankruptcy Code, would become due), liabilities and indebtedness owing by the
Borrower under any Interest Rate Protection Agreement or Other Hedging
Agreement, whether now in existence or hereafter arising, and the due
performance and compliance by the Borrower with all of the terms, conditions and
agreements contained in the Interest Rate Protection Agreements or Other Hedging
Agreements (all such obligations, liabilities and indebtedness being herein
collectively called the "Other Obligations," and together with the Credit
Document Obligations, the "Guaranteed Obligations"). Each Guarantor understands,
agrees and confirms that the Secured Creditors may enforce this Guaranty up to
the full amount of the Guaranteed Obligations against such Guarantor without
proceeding against any other Guarantor, the Borrower, against any security for
the Guaranteed Obligations, or under any other guaranty covering all or a
portion of the Guaranteed Obligations.

                  2. Additionally, each Guarantor, jointly and severally,
unconditionally, absolutely and irrevocably, guarantees the payment of any and
all Guaranteed Obligations whether or not due or payable by the Borrower upon
the occurrence in respect of the Borrower of any of the events specified in
Section 10.05 of the Credit Agreement, and unconditionally, absolutely and
irrevocably, jointly and severally, promises to pay such Guaranteed Obligations
to the Secured Creditors, or order, on demand, in legal tender of the United
States. This Guaranty shall constitute a guaranty of payment, and not of
collection.

                  3. The liability of each Guarantor hereunder is primary,
absolute and unconditional and is exclusive and independent of any security for
or other guaranty of the indebtedness of the Borrower whether executed by such
Guarantor, any other Guarantor, any
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other guarantor or by any other party, and the liability of each Guarantor
hereunder shall not be affected or impaired by any circumstance or occurrence
whatsoever, including, without limitation: (a) any direction as to application
of payment by the Borrower or by any other party, (b) any other continuing or
other guaranty, undertaking or maximum liability of a guarantor or of any other
party as to the Guaranteed Obligations, (c) any payment on or in reduction of
any such other guaranty or undertaking, (d) any dissolution, termination or
increase, decrease or change in personnel by the Borrower, (e) any payment made
to any Secured Creditor on the Guaranteed Obligations which any Secured Creditor
repays the Borrower pursuant to court order in any bankruptcy, reorganization,
arrangement, moratorium or other debtor relief proceeding, and each Guarantor
waives any right to the deferral or modification of its obligations hereunder by
reason of any such proceeding, (f) any action or inaction by the Secured
Creditors as contemplated in Section 6 hereof or (g) any invalidity,
irregularity or unenforceability of all or any part of the Guaranteed
Obligations or of any security therefor.

                  4. The obligations of each Guarantor hereunder are independent
of the obligations of any other Guarantor, any other guarantor or the Borrower,
and a separate action or actions may be brought and prosecuted against each
Guarantor whether or not action is brought against any other Guarantor, any
other guarantor or the Borrower and whether or not any other Guarantor, any
other guarantor or the Borrower be joined in any such action or actions. Each
Guarantor waives, to the fullest extent permitted by law, the benefits of any
statute of limitations affecting its liability hereunder or the enforcement
thereof. Any payment by the Borrower or other circumstance which operates to
toll any statute of limitations as to the Borrower shall operate to toll the
statute of limitations as to each Guarantor.

                  5. Each Guarantor hereby waives notice of acceptance of this
Guaranty and notice of any liability to which it may apply, and waives
promptness, diligence, presentment, demand of payment, protest, notice of
dishonor or nonpayment of any such liabilities, suit or taking of other action
by the Administrative Agent or any other Secured Creditor against, and any other
notice to, any party liable thereon (including such Guarantor, any other
Guarantor, any other guarantor, the Borrower).

                  6. Any Secured Creditor may at any time and from time to time
without the consent of, or notice to, any Guarantor (except as shall be required
by applicable statute and cannot be waived), without incurring responsibility to
such Guarantor, without impairing or releasing the obligations of such Guarantor
hereunder, upon or without any terms or conditions and in whole or in part:

                  (a) change the manner, place or terms of payment of, and/or
         change or extend the time of payment of, renew, alter or increase, any
         of the Guaranteed Obligations (including any increase or decrease in
         the rate of interest thereon), any security therefor, or any liability
         incurred directly or indirectly in respect thereof, and the guaranty
         herein made shall apply to the Guaranteed Obligations as so changed,
         extended, renewed or altered;

                  (b) take and hold security for the payment of the Guaranteed
         Obligations and sell, exchange, release, surrender, impair, realize
         upon or otherwise deal with in any manner
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         and in any order any property by whomsoever at any time pledged or
         mortgaged to secure, or howsoever securing, the Guaranteed Obligations
         or any liabilities (including any of those hereunder) incurred directly
         or indirectly in respect thereof or hereof, and/or any offset
         thereagainst;

                  (c) exercise or refrain from exercising any rights against the
         Borrower, any other Credit Party, any Subsidiary thereof or otherwise
         act or refrain from acting;

                  (d)  release or substitute any one or more endorsers,
         Guarantors, other guarantors, the Borrower or other obligors;

                  (e) settle or compromise any of the Guaranteed Obligations,
         any security therefor or any liability (including any of those
         hereunder) incurred directly or indirectly in respect thereof or
         hereof, and may subordinate the payment of all or any part thereof to
         the payment of any liability (whether due or not) of the Borrower to
         creditors of the Borrower other than the Secured Creditors;

                  (f) apply any sums by whomsoever paid or howsoever realized to
         any liability or liabilities of the Borrower to the Secured Creditors
         regardless of what liabilities of the Borrower remain unpaid;

                  (g) consent to or waive any breach of, or any act, omission or
         default under, any of the Interest Rate Protection Agreements or Other
         Hedging Agreements, the Credit Documents or any of the instruments or
         agreements referred to therein, or otherwise amend, modify or
         supplement any of the Interest Rate Protection Agreements or Other
         Hedging Agreements, the Credit Documents or any of such other
         instruments or agreements;

                  (h) act or fail to act in any manner referred to in this
         Guaranty which may deprive such Guarantor of its right to subrogation
         against the Borrower to recover full indemnity for any payments made
         pursuant to this Guaranty; and/or

                  (i) take any other action which would, under otherwise
         applicable principles of common law, give rise to a legal or equitable
         discharge of such Guarantor from its liabilities under this Guaranty.

                  7. This Guaranty is a continuing one and all liabilities to
which it applies or may apply under the terms hereof shall be conclusively
presumed to have been created in reliance hereon. No failure or delay on the
part of any Secured Creditor in exercising any right, power or privilege
hereunder shall operate as a waiver thereof, nor shall any single or partial
exercise of any right, power or privilege hereunder preclude any other or
further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein expressly specified are cumulative and not
exclusive of any rights or remedies which any Secured Creditor would otherwise
have. No notice to or demand on any Guarantor in any case shall entitle such
Guarantor to any other further notice or demand in similar or other
circumstances or constitute a
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waiver of the rights of any Secured Creditor to any other or further action in
any circumstances without notice or demand. It is not necessary for any Secured
Creditor to inquire into the capacity or powers of the Borrower or the officers,
directors, partners or agents acting or purporting to act on its behalf, and any
indebtedness made or created in reliance upon the professed exercise of such
powers shall be guaranteed hereunder.

                  8. Any indebtedness of the Borrower now or hereafter held by
any Guarantor is hereby subordinated to the Guaranteed Obligations of the
Borrower owing to the Secured Creditors, and if the Administrative Agent or the
Collateral Agent, after the occurrence and during the continuance of an Event of
Default, so requests, shall be collected, enforced and received by such
Guarantor as trustee for the Secured Creditors and be paid over to the Secured
Creditors on account of the Guaranteed Obligations of the Borrower to the
Secured Creditors, but without affecting or impairing in any manner the
liability of such Guarantor under the other provisions of this Guaranty. Without
limiting the generality of the foregoing, each Guarantor hereby agrees with the
Secured Creditors that it will not exercise any right of subrogation which it
may at any time otherwise have as a result of this Guaranty (whether
contractual, under Section 509 of the Bankruptcy Code or otherwise) until all
Guaranteed Obligations have been irrevocably paid in full in cash.

                  9. (a) Each Guarantor waives any right (except as shall be
required by applicable law and cannot be waived) to require the Secured
Creditors to: (i) proceed against the Borrower, any other Guarantor, any other
guarantor of the Guaranteed Obligations or any other party; (ii) proceed against
or exhaust any security held from the Borrower, any other Guarantor, any other
guarantor of the Guaranteed Obligations or any other party; or (iii) pursue any
other remedy in the Secured Creditors' power whatsoever. Each Guarantor waives
any defense based on or arising out of any defense of the Borrower, any other
Guarantor, any other guarantor of the Guaranteed Obligations or any other party
other than payment in full of the Guaranteed Obligations, including, without
limitation, any defense based on or arising out of the disability of the
Borrower, any other Guarantor, any other guarantor of the Guaranteed Obligations
or any other party, or the unenforceability of the Guaranteed Obligations or any
part thereof from any cause, or the cessation from any cause of the liability of
the Borrower other than payment in full of the Guaranteed Obligations. The
Secured Creditors may, at their election, foreclose on any security held by the
Administrative Agent, the Collateral Agent or the other Secured Creditors by one
or more judicial or nonjudicial sales, whether or not every aspect of any such
sale is commercially reasonable (to the extent such sale is permitted by
applicable law), or exercise any other right or remedy the Secured Creditors may
have against the Borrower or any other party, or any security, without affecting
or impairing in any way the liability of any Guarantor hereunder except to the
extent the Guaranteed Obligations have been paid in full in cash. Each Guarantor
waives any defense arising out of any such election by the Secured Creditors,
even though such election operates to impair or extinguish any right of
reimbursement or subrogation or other right or remedy of such Guarantor against
the Borrower or any other party or any security.

                  (b) Each Guarantor waives all presentments, demands for
performance, protests and notices, including, without limitation, notices of
nonperformance, notices of protest, notices
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of dishonor, notices of acceptance of this Guaranty, and notices of the
existence, creation or incurring of new or additional indebtedness. Each
Guarantor assumes all responsibility for being and keeping itself informed of
the Borrower's financial condition and assets, and of all other circumstances
bearing upon the risk of nonpayment of the Guaranteed Obligations and the
nature, scope and extent of the risks which such Guarantor assumes and incurs
hereunder, and agrees that the Secured Creditors shall have no duty to advise
any Guarantor of information known to them regarding such circumstances or
risks.

                  (c) Each Guarantor hereby acknowledges and affirms that it
understands that to the extent the Guaranteed Obligations are secured by Real
Property located in the State of California, such Guarantor shall be liable for
the full amount of its liability hereunder notwithstanding foreclosure on such
Real Property by trustee sale or any other reason impairing such Guarantor's or
any Secured Creditors' right to proceed against the Borrower or any other
guarantor of the Guaranteed Obligations. In accordance with Section 2856 of the
California Civil Code, each Guarantor hereby waives:

                  (i) all rights of subrogation, reimbursement, indemnification,
         and contribution and any other rights and defenses that are or may
         become available to such Guarantor by reason of Sections 2787 to 2855,
         inclusive, 2899 and 3433 of the California Civil Code;

                  (ii) all rights and defenses that such Guarantor may have
         because the Guaranteed Obligations are secured by Real Property located
         in the State of California. This means, among other things: (A) the
         Secured Creditors may collect from such Guarantors without first
         foreclosing on any real or personal property collateral pledged by the
         Borrower or any other Credit Party; and (B) if the Secured Creditors
         foreclose on any Real Property collateral pledged by the Borrower or
         any other Credit Party, (1) the amount of the Guaranteed Obligations
         may be reduced only by the price for which that collateral is sold at
         the foreclosure sale, even if the collateral is worth more than the
         sale price, and (2) the Secured Creditors may collect from such
         Guarantor even if the Secured Creditors, by foreclosing on the Real
         Property collateral, have destroyed any right such Guarantor may have
         to collect from the Borrower. This is an unconditional and irrevocable
         waiver of any rights and defenses such Guarantor may have because the
         Guaranteed Obligations are secured by Real Property located in the
         State of California. These rights and defenses include, but are not
         limited to, any rights or defenses based upon Section 580a, 580b, 580d
         or 726 of the California Code of Civil Procedure; and

                  (iii) all rights and defenses arising out of an election of
         remedies by the Secured Creditors, even though that election of
         remedies, such as a nonjudicial foreclosure with respect to security
         for the Guaranteed Obligations, has destroyed such Guarantor's rights
         of subrogation and reimbursement against the Borrower by the operation
         of Section 580d of the California Code of Civil Procedure or otherwise.

                  Each Guarantor warrants and agrees that each of the waivers
set forth above is made with full knowledge of its significance and consequences
and that if any of such waivers
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are determined to be contrary to any applicable law or public policy, such
waivers shall be effective only to the maximum extent permitted by law.

                  10. The Secured Creditors agree that this Guaranty may be
enforced only by the action of the Administrative Agent or the Collateral Agent
and that no other Secured Creditors shall have any right individually to seek to
enforce or to enforce this Guaranty or to realize upon the security to be
granted by the Security Documents, it being understood and agreed that such
rights and remedies may be exercised by the Administrative Agent or the
Collateral Agent or, after all the Credit Document Obligations have been paid in
full, by the holders of at least a majority of the outstanding Other
Obligations, as the case may be, for the benefit of the Secured Creditors upon
the terms of this Guaranty and the Security Documents. The Secured Creditors
further agree that this Guaranty may not be enforced against any director,
officer, employee, partner or stockholder of any Guarantor (except to the extent
such partner or stockholder is also a Guarantor hereunder).

                  11. In order to induce the Lenders to make Loans to, and issue
Letters of Credit for the account of, the Borrower pursuant to the Credit
Agreement, and in order to induce the Other Creditors to execute, deliver and
perform the Interest Rate Protection Agreements or Other Hedging Agreements,
each Guarantor represents, warrants and covenants that:

                  (a) Such Guarantor (i) is a duly organized and validly
         existing corporation in good standing under the laws of the
         jurisdiction of its organization, (ii) has the corporate power and
         authority to own its property and assets and to transact the business
         in which it is engaged and presently proposes to engage and (iii) is
         duly qualified and is authorized to do business and is in good standing
         in each jurisdiction where the conduct of its business requires such
         qualification except for failures to be so qualified which,
         individually or in the aggregate, could not reasonably be expected to
         have a material adverse effect on the business, operations, property,
         assets, liabilities, condition (financial or otherwise) or prospects of
         Holdings and its Subsidiaries taken as a whole.

                  (b) Such Guarantor has the corporate power and authority to
         execute, deliver and perform the terms and provisions of this Guaranty
         and each other Document to which it is a party and has taken all
         necessary corporate action to authorize the execution, delivery and
         performance by it of this Guaranty and each such other Document. Such
         Guarantor has duly executed and delivered this Guaranty and each other
         Document to which it is a party, and this Guaranty and each such other
         Document constitutes the legal, valid and binding obligation of such
         Guarantor enforceable in accordance with its terms, except to the
         extent that the enforceability hereof or thereof may be limited by
         applicable bankruptcy, insolvency, reorganization, moratorium or other
         similar laws generally affecting creditors' rights and by equitable
         principles (regardless of whether enforcement is sought in equity or at
         law).

                  (c) Neither the execution, delivery or performance by such
         Guarantor of this Guaranty or any other Document to which it is a
         party, nor compliance by it with the terms and provisions hereof and
         thereof, will (i) contravene any provision of any
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         applicable law, statute, rule or regulation or any applicable order,
         writ, injunction or decree of any court or governmental
         instrumentality, (ii) conflict with or result in any breach of any of
         the terms, covenants, conditions or provisions of, or constitute a
         default under, or result in the creation or imposition of (or the
         obligation to create or impose) any Lien (except pursuant to the
         Security Documents) upon any of the property or assets of such
         Guarantor or any of its Subsidiaries pursuant to the terms of any
         indenture, mortgage, deed of trust, loan agreement, credit agreement,
         or any other material agreement, contract or instrument to which such
         Guarantor or any of its Subsidiaries is a party or by which it or any
         of its property or assets is bound or to which it may be subject or
         (iii) violate any provision of the certificate of incorporation or
         by-laws (or equivalent organizational documents) of such Guarantor or
         any of its Subsidiaries.

                  (d) No order, consent, approval, license, authorization or
         validation of, or filing, recording or registration with (except as
         have been obtained or made), or exemption by, any governmental or
         public body or authority, or any subdivision thereof, is required to
         authorize, or is required for, (i) the execution, delivery and
         performance of this Guaranty by such Guarantor or any other Document to
         which such Guarantor is a party or (ii) the legality, validity, binding
         effect or enforceability of this Guaranty or any other Document to
         which such Guarantor is a party.

                  (e) There are no actions, suits or proceedings pending or
         threatened (i) with respect to this Guaranty or any other Document to
         which such Guarantor is a party or (ii) with respect to such Guarantor
         that could reasonably be expected to materially and adversely affect
         (a) the business, operations, property, assets, liabilities, condition
         (financial or otherwise) or prospects of Holdings and its Subsidiaries
         taken as a whole or (b) the rights or remedies of the Secured Creditors
         hereunder or under the other Credit Documents to which such Guarantor
         is a party or the ability of such Guarantor to perform its respective
         obligations to the Secured Creditors hereunder and under the other
         Credit Documents to which it is a party.

                  12. Each Guarantor covenants and agrees that on and after the
Effective Date and until the termination of the Total Commitment and all
Interest Rate Protection Agreements and Other Hedging Agreements, and when no
Note or Letter of Credit remains outstanding and all Guaranteed Obligations have
been paid in full, such Guarantor will comply, and will cause each of its
Subsidiaries to comply, with all of the applicable provisions, covenants and
agreements contained in Sections 8 and 9 of the Credit Agreement, and will take,
or will refrain from taking, as the case may be, all actions that are necessary
to be taken or not taken so that it is not in violation of any provision,
covenant or agreement contained in Section 8 or 9 of the Credit Agreement, and
so that no Default or Event of Default, is caused by the actions of such
Guarantor or any of its Subsidiaries.

                  13. The Guarantors hereby jointly and severally agree to pay
all reasonable out-of-pocket costs and expenses of each Secured Creditor in
connection with the enforcement of this Guaranty and of the Administrative Agent
in connection with any amendment, waiver or consent
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relating hereto (including in each case, without limitation, the reasonable fees
and disbursements of counsel employed by each Secured Creditor).

                  14. This Guaranty shall be binding upon each Guarantor and its
successors and assigns and shall inure to the benefit of the Secured Creditors
and their successors and assigns.

                  15. Neither this Guaranty nor any provision hereof may be
changed, waived, discharged or terminated except with the written consent of
each Guarantor directly affected thereby and with the written consent of the
Required Secured Creditors (as defined in the Security Agreement); provided,
that any change, waiver, modification or variance affecting the rights and
benefits of a single Class (as defined below) of Secured Creditors (and not all
Secured Creditors in a like or similar manner) shall also require the written
consent of the Requisite Creditors (as defined below) of such Class of Secured
Creditors (it being understood that the addition or release of any Guarantor
hereunder shall not constitute a change, waiver, discharge or termination
affecting any Guarantor other than the Guarantor so added or released). For the
purpose of this Guaranty, the term "Class" shall mean each class of Secured
Creditors, i.e., whether (x) the Lender Creditors as holders of the Credit
Document Obligations or (y) the Other Creditors as the holders of the Other
Obligations. For the purpose of this Guaranty, the term "Requisite Creditors" of
any Class shall mean (x) with respect to the Credit Document Obligations, the
Required Lenders and (y) with respect to the Other Obligations, the holders of
at least a majority of all obligations outstanding from time to time under the
Interest Rate Protection or Other Hedging Agreements.

                  16. Each Guarantor acknowledges that an executed (or
conformed) copy of each of the Credit Documents and Interest Rate Protection
Agreements or Other Hedging Agreements has been made available to its principal
executive officers and such officers are familiar with the contents thereof.

                  17. In addition to any rights now or hereafter granted under
applicable law (including, without limitation, Section 151 of the New York
Debtor and Secured Creditor Law) and not by way of limitation of any such
rights, upon the occurrence and during the continuance of an Event of Default
(such term to mean and include any "Event of Default" as defined in the Credit
Agreement or any payment default under any Interest Rate Protection Agreement or
Other Hedging Agreement continuing after any applicable grace period), each
Secured Creditor is hereby authorized, at any time or from time to time, without
notice to any Guarantor or to any other Person, any such notice being expressly
waived, to set off and to appropriate and apply any and all deposits (general or
special) and any other indebtedness at any time held or owing by such Secured
Creditor to or for the credit or the account of such Guarantor, against and on
account of the obligations and liabilities of such Guarantor to such Secured
Creditor under this Guaranty, irrespective of whether or not such Secured
Creditor shall have made any demand hereunder and although said obligations,
liabilities, deposits or claims, or any of them, shall be contingent or
unmatured. Notwithstanding anything to the contrary contained in this Section
17, no Secured Creditor shall exercise any such right of set-off without the
prior consent of the Administrative Agent or the Required Secured Creditors so
long as the Guaranteed Obligations shall be secured
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by any Real Property located in the State of California, it being understood and
agreed, however, that this sentence is for the sole benefit of the Secured
Creditors and may be amended, modified or waived in any respect by the Required
Secured Creditors without the requirements of prior notice to or consent by any
Credit Party and does not constitute a waiver of any rights against any Credit
party or against any Collateral.

                  18. All notices, requests, demands or other communications
pursuant hereto shall be deemed to have been duly given or made when delivered
to the Person to which such notice, request, demand or other communication is
required or permitted to be given or made under this Guaranty, addressed to such
party at (i) in the case of any Lender Creditor, as provided in the Credit
Agreement, (ii) in the case of any Guarantor, at the address set forth opposite
such Guarantor's signature below and (iii) in the case of any Other Creditor, at
such address as such Other Creditor shall have specified in writing to the
Guarantors; or in any case at such other address as any of the Persons listed
above may hereafter notify the others in writing.

                  19. If claim is ever made upon any Secured Creditor for
repayment or recovery of any amount or amounts received in payment or on account
of any of the Guaranteed Obligations and any of the aforesaid payees repays all
or part of said amount by reason of (i) any judgment, decree or order of any
court or administrative body having jurisdiction over such payee or any of its
property or (ii) any settlement or compromise of any such claim effected by such
payee with any such claimant (including the Borrower) then and in such event
each Guarantor agrees that any such judgment, decree, order, settlement or
compromise shall be binding upon such Guarantor, notwithstanding any revocation
hereof or other instrument evidencing any liability of the Borrower, and such
Guarantor shall be and remain liable to the aforesaid payees hereunder for the
amount so repaid or recovered to the same extent as if such amount had never
originally been received by any such payee.

                  20. (a) THIS GUARANTY SHALL BE CONSTRUED IN ACCORDANCE WITH
AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK. Any legal action or
proceeding with respect to this Guaranty or any other Credit Document to which
any Guarantor is a party may be brought in the courts of the State of New York
or of the United States for the Southern District of New York, and, by execution
and delivery of this Guaranty, each Guarantor hereby irrevocably accepts for
itself and in respect of its property, generally and unconditionally, the
jurisdiction of the aforesaid courts. Each Guarantor hereby irrevocably
designates, appoints and empowers CT Corporation System, with offices on the
date hereof at 111 Eighth Avenue, New York, New York 10011, as its designee,
appointee and agent to receive, accept and acknowledge for and on its behalf,
and in respect of its property, service of any and all legal process, summons,
notices and documents which may be served in any such action or proceeding. If
for any reason such designee, appointee and agent shall cease to be available to
act as such, each Guarantor agrees to designate a new designee, appointee and
agent in New York City on the terms and for purposes of this provision
satisfactory to the Administrative Agent. Each Guarantor further irrevocably
consents to the service of process out of any of the aforementioned courts in
any such action or proceeding by the mailing of copies thereof by registered or
certified mail, postage prepaid, to each Guarantor at the address set forth as
<PAGE>   11

                                                                       EXHIBIT I
                                                                         Page 11

described in Section 18 above, such service to become effective thirty (30) days
after such mailing. Each Guarantor hereby irrevocably waives any objection to
such service of process and further irrevocably waives and agrees not to plead
or claim in any action or proceeding commenced hereunder or under any other
Credit Documents to which such Guarantor is a party that service of process was
in any way invalid or ineffective. Nothing herein shall affect the right of the
Administrative Agent, any Creditor or the holder of any Note to serve process in
any other manner permitted by law or to commence legal proceedings or otherwise
proceed against each Guarantor in any other jurisdiction.

                  (b) Each Guarantor hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Guaranty or any other Credit Document to which it is a party brought in the
courts referred to in clause (a) above and hereby further irrevocably waives and
agrees not to plead or claim in any such court that any such action or
proceeding brought in any such court has been brought in an inconvenient forum.
Each Guarantor further waives any right it may have to trial by jury in any
court or jurisdiction, including, without limitation, the jurisdictions and
courts referred to in clause (a) above.

                  21. In the event that all of the capital stock of one or more
Guarantors is sold or otherwise disposed of or liquidated in compliance with the
requirements of Section 9.02 of the Credit Agreement (or such sale or other
disposition has been approved in writing by the Required Secured Creditors) (or
all Lenders if required by Section 13.12 of the Credit Agreement) and the
proceeds of such sale, disposition or liquidation are applied in accordance with
the provisions of Section 4.02 of the Credit Agreement, to the extent
applicable, such Guarantor shall upon consummation of such sale or other
disposition (except to the extent that such sale or disposition is to the
Borrower or another Subsidiary thereof) be released from this Guaranty
automatically and without further action and this Guaranty shall, as to each
such Guarantor or Guarantors, terminate, and have no further force or effect (it
being understood and agreed that the sale of one or more Persons that own,
directly or indirectly, all of the capital stock of any Guarantor shall be
deemed to be a sale of such Guarantor for the purposes of this Section 21).

                  22. At any time a payment in respect of the Guaranteed
Obligations is made under this Guaranty, the right of contribution of each
Guarantor against each other Guarantor shall be determined as provided in the
immediately following sentence, with the right of contribution of each Guarantor
to be revised and restated as of each date on which a payment (a "Relevant
Payment") is made on the Guaranteed Obligations under this Guaranty. At any time
that a Relevant Payment is made by a Guarantor that results in the aggregate
payments made by such Guarantor in respect of the Guaranteed Obligations to and
including the date of the Relevant Payment exceeding such Guarantor's
Contribution Percentage (as defined below) of the aggregate payments made by all
Guarantors in respect of the Guaranteed Obligations to and including the date of
the Relevant Payment (such excess, the "Aggregate Excess Amount"), each such
Guarantor shall have a right of contribution against each other Guarantor who
has made payments in respect of the Guaranteed Obligations to and including the
date of the Relevant Payment in an aggregate amount less than such other
Guarantor's Contribution Percentage of the
<PAGE>   12

                                                                       EXHIBIT I
                                                                         Page 12

aggregate payments made to and including the date of the Relevant Payment by all
Guarantors in respect of the Guaranteed Obligations (the aggregate amount of
such deficit, the "Aggregate Deficit Amount") in an amount equal to (x) a
fraction the numerator of which is the Aggregate Excess Amount of such Guarantor
and the denominator of which is the Aggregate Excess Amount of all Guarantors
multiplied by (y) the Aggregate Deficit Amount of such other Guarantor. A
Guarantor's right of contribution pursuant to the preceding sentences shall
arise at the time of each computation, subject to adjustment to the time of any
subsequent computation; provided, that no Guarantor may take any action to
enforce such right until the Guaranteed Obligations have been irrevocably paid
in full in cash, it being expressly recognized and agreed by all parties hereto
that any Guarantor's right of contribution arising pursuant to this Section 22
against any other Guarantor shall be expressly junior and subordinate to such
other Guarantor's obligations and liabilities in respect of the Guaranteed
Obligations and any other obligations owing under this Guaranty. As used in this
Section 22: (i) each Guarantor's "Contribution Percentage" shall mean the
percentage obtained by dividing (x) the Adjusted Net Worth (as defined below) of
such Guarantor by (y) the aggregate Adjusted Net Worth of all Guarantors; (ii)
the "Adjusted Net Worth" of each Guarantor shall mean the greater of (x) the Net
Worth (as defined below) of such Guarantor and (y) zero; and (iii) the "Net
Worth" of each Guarantor shall mean the amount by which the fair salable value
of such Guarantor's assets on the date of any Relevant Payment exceeds its
existing debts and other liabilities (including contingent liabilities, but
without giving effect to any Guaranteed Obligations arising under this Guaranty)
on such date. All parties hereto recognize and agree that, except for any right
of contribution arising pursuant to this Section 22, each Guarantor who makes
any payment in respect of the Guaranteed Obligations shall have no right of
contribution or subrogation against any other Guarantor in respect of such
payment until all of the Guaranteed Obligations have been irrevocably paid in
full in cash. Each of the Guarantors recognizes and acknowledges that the rights
to contribution arising hereunder shall constitute an asset in favor of the
party entitled to such contribution. In this connection, each Guarantor has the
right to waive its contribution right against any Guarantor to the extent that
after giving effect to such waiver such Guarantor would remain solvent, in the
determination of the Required Lenders.

                  23. Each Guarantor and each Secured Creditor (by its
acceptance of the benefits of this Guaranty) hereby confirms that it is its
intention that this Guaranty not constitute fraudulent transfer or conveyance
for purposes of the Bankruptcy Code, the Uniform Fraudulent Conveyance Act or
any similar Federal or state law. To effectuate the foregoing intention, each
Guarantor and each Secured Creditor (by its acceptance of the benefits of this
Guaranty) hereby irrevocably agrees that the Guaranteed Obligations guaranteed
by such Guarantor shall be limited to such amount as will, after giving effect
to such maximum amount and all other (contingent or otherwise) liabilities of
such Guarantor that are relevant under such laws, and after giving effect to any
rights to contribution pursuant to any agreement providing for an equitable
contribution among such Guarantor and the other Guarantors, result in the
Guaranteed Obligations of such Guarantor in respect of such maximum amount not
constituting a fraudulent transfer or conveyance.
<PAGE>   13

                                                                       EXHIBIT I
                                                                         Page 13

                  24. This Guaranty may be executed in any number of
counterparts and by the different parties hereto on separate counterparts, each
of which when so executed and delivered shall be an original, but all of which
shall together constitute one and the same instrument. A set of counterparts
executed by all the parties hereto shall be lodged with the Guarantors and the
Administrative Agent.

                  25. All payments made by any Guarantor hereunder will be made
without setoff, counterclaim or other defense and on the same basis as payments
are made by the Borrower under Sections 4.03 and 4.04 of the Credit Agreement.

                  26. It is understood and agreed that any Subsidiary of
Holdings that is required to execute a counterpart of this Guaranty after the
date hereof pursuant to the Credit Agreement shall automatically become a
Guarantor hereunder by executing a counterpart hereof and delivering the same to
the Administrative Agent.
<PAGE>   14

                                                                       EXHIBIT I
                                                                         Page 14

                  IN WITNESS WHEREOF, each Guarantor has caused this Guaranty to
be executed and delivered as of the date first above written.

Address:

4440 Brittmoore Road                          UNIVERSAL COMPRESSION
Houston, TX                                   INTERNATIONAL, INC.,
Attn: President                                 as a Guarantor
Tel.: (713) 335-7000
Fax:  (713) 446-6720                          By /s/ RICHARD FITZGERALD
                                                 ------------------------------
                                                 Title: Chief Financial Officer
Accepted and Agreed to:

BANKERS TRUST COMPANY,
  as Administrative Agent

By /s/ MARCUS TARKINGTON
   ---------------------------
   Title: Director<PAGE>   1
                                                                   EXHIBIT 10.2

                           CHANGE OF CONTROL AGREEMENT

         This Change of Control Agreement (this "Agreement") is entered into and
deemed effective as of June 10, 1998, by and between Weatherford International,
Inc., a Delaware corporation (the "Company"), and Burt M. Martin (the
"Employee").

                              W I T N E S S E T H:
                               - - - - - - - - - -

         WHEREAS, the Employee has accepted an offer of employment with the
Company as Associate General Counsel; and

         WHEREAS, the terms of employment with the Company included an agreement
with the Employee that in the event there were to be a Change of Control (as
defined below) of the Company within three years from the date hereof, the
Employee would be entitled to certain enhanced severance benefits if the
employment of the Employee is terminated by the Company without Cause (as
defined below) or by the Employee for Good Reason (as defined below).

         NOW, THEREFORE, IT IS HEREBY AGREED AS FOLLOWS:

         1.       Certain Definitions.

                  (a) "Effective Date" shall mean the first date during the
Change of Control Period (as defined in Section 1(b)) on which a Change of
Control (as defined in Section 1(c)) occurs. Anything in this Agreement to the
contrary notwithstanding, if a Change of Control occurs and if the Employee's
employment with the Company is terminated prior to the date on which the Change
of Control occurs, and if it is reasonably demonstrated by the Employee that
such termination of employment (i) was at the request of a third party who has
taken steps reasonably calculated to effect a Change of Control or (ii)
otherwise arose in connection with or anticipation of a Change of Control, then
for all purposes of this Agreement the "Effective Date" shall mean the date
immediately prior to the date of such termination of employment.

                  (b) The "Change of Control Period" shall mean the period
commencing on the date hereof and ending on the third anniversary of the date
hereof; provided, however, that commencing on the date one year after the date
hereof, and on each annual anniversary of such date (such date and each annual
anniversary thereof shall be hereinafter referred to as the "Renewal Date"),
unless previously terminated, the Change of Control Period shall be
automatically extended so as to terminate three year(s) after such Renewal Date,
unless at least 60 days prior to the Renewal Date the Company shall give notice
to the Employee that the Change of Control Period shall not be so extended.

                  (c) A "Change of Control" shall mean:

                           (i) The acquisition by any individual, entity or
group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act")) (a "Person") of
beneficial ownership (within the meaning of Rule 13d-3 promulgated under the
Exchange Act) of 20 percent or more of either (A) the then outstanding shares of
common stock of the Company (the "Outstanding Company Common Stock") or (B) the
combined voting power of the then outstanding voting securities of the Company
entitled to vote generally in the election of directors (the "Outstanding
Company Voting Securities"); provided, however, that for purposes of this
subsection (i), the following acquisitions shall not constitute a Change of
Control:

<PAGE>   2

                                    (A) any acquisition directly from the
Company; or

                                    (B) any acquisition by the Company; or

                                    (C) any acquisition by any employee benefit
plan (or related trust) sponsored or maintained by the Company or any
corporation controlled by the Company; or

                                    (D) any acquisition by any corporation
pursuant to a transaction which complies with clauses (A), (B) and (C) of
subsection (iii) of this Section 1(c); or

                           (ii) Individuals, who, as of the date hereof,
constitute the Board (the "Incumbent Board") cease for any reason to constitute
at least a majority of the Board; provided, however, that any individual
becoming a director subsequent to the date hereof whose election, or nomination
for election by the Company's stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board shall be
considered as though such individual was a member of the Incumbent Board, but
excluding, for this purpose, any such individual whose initial assumption of
office occurs as a result of an actual or threatened election contest with
respect to the election or removal of directors or other actual or threatened
solicitation of proxies or consents by or on behalf of a Person other than the
Board; or

                           (iii) Consummation of a reorganization, merger or
consolidation or sale or other disposition of all or substantially all of the
assets of the Company (a "Corporate Transaction") in each case, unless,
following such Corporate Transaction, (A) all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities
immediately prior to such Corporate Transaction beneficially own, directly or
indirectly, more than 60 percent of, respectively, the then outstanding shares
of common stock and the combined voting power of the then outstanding voting
securities entitled to vote generally in the election of directors, as the case
may be, of the corporation resulting from such Corporate Transaction (including,
without limitation, a corporation which as a result of such transaction owns the
Company or all or substantially all of the Company's assets either directly or
through one or more subsidiaries) in substantially the same proportions as their
ownership, immediately prior to such Corporate Transaction, of the Outstanding
Company Common Stock and the Outstanding Company Voting Securities, as the case
may be, (B) no Person (excluding any corporation resulting from such Corporate
Transaction or any employee benefit plan (or related trust) of the Company or
such corporation resulting from such Corporate Transaction) beneficially owns,
directly or indirectly, 20 percent or more of, respectively, the then
outstanding shares of common stock of the corporation resulting from such
Corporate Transaction or the combined voting power of the then outstanding
voting securities of such corporation except to the extent that such ownership
existed prior to the Corporate Transaction and (C) at least a majority of the
members of the board of directors of the corporation resulting from such
Corporate Transaction were members of the Incumbent Board at the time of the
execution of the initial agreement, or of the action of the Board, providing for
such Corporate Transaction; or

                           (iv) Approval by the stockholders of the Company of a
complete liquidation or dissolution of the Company.

                  (d) "Board" shall mean the Board of Directors of the Company.

         2. Employment Period. The Company hereby agrees that the Company or an
affiliated company will continue the Employee in its employ, and the Employee
hereby agrees to remain in the employ of the Company or an affiliate subject to
the terms and conditions of this Agreement, for the period commencing on the
Effective Date and ending on the second anniversary of such date (the
"Employment Period").

                                       2
<PAGE>   3

         3.  Terms of Employment.

                  (a) Position and Duties. During the Employment Period, (A) the
Employee's position shall be at least commensurate in all material respects with
the most significant of those held, exercised and assigned at any time during
the 120-day period immediately preceding the Effective Date and (B) the
Employee's services shall be performed at the Company's principal executive
offices in Houston, Texas or other locations less than 35 miles from such
principal executive offices.

                  (b) Compensation.

                           (i) Base Salary. During the Employment Period, the
         Employee shall receive an annual base salary ("Annual Base Salary"),
         which shall be paid at a monthly rate, at least equal to 12 times the
         highest monthly base salary paid or payable, including any base salary
         which has been earned but deferred, to the Employee by the Company
         and/or its affiliated companies in respect of the 12-month period
         immediately preceding the month in which the Effective Date occurs.
         During the Employment Period, the Annual Base Salary shall be reviewed
         from time to time on the same basis as similarly situated employees;
         provided, however, that a salary increase shall not necessarily be
         awarded as a result of such review. Any increase in Annual Base Salary
         may not serve to limit or reduce any other obligation to the Employee
         under this Agreement. Annual Base Salary shall not be reduced after any
         such increase. The term Annual Base Salary as utilized in this
         Agreement shall refer to Annual Base Salary as so increased.

                           (ii) Annual Bonus. The Employee shall be eligible for
         an annual bonus (the "Annual Bonus") for each fiscal year ending during
         the Employment Period on the same basis as other key employees under
         the Company's annual incentive programs.

                           (iii) Incentive, Savings and Retirement Plans. During
         the Employment Period, the Employee shall be entitled to participate in
         all incentive, savings and retirement plans, practices, policies and
         programs applicable generally to the Employee's peer key employees of
         the Company and its affiliated companies. As used in this Agreement,
         the term "affiliated companies" shall include any company controlled
         by, controlling or under common control with the Company.

                           (iv) Welfare Benefit Plans. During the Employment
         Period, the Employee and/or the Employee's family, as the case may be,
         shall be eligible to participate in and shall receive all benefits
         under welfare benefit plans, practices, policies and programs provided
         by the Company and its affiliated companies (including, without
         limitation, medical, prescription, dental, disability, salary
         continuance, employee life, group life, accidental death and travel
         accident insurance plans and programs) to the extent applicable
         generally to the Employee's peer key employees of the Company and its
         affiliated companies.

                           (v) Fringe Benefits. During the Employment Period,
         the Employee shall be entitled to (A) payment of bar and professional
         association dues, payment of state professional taxes and a car
         allowance and (B) such other fringe benefits as in effect generally at
         any time thereafter with respect to the Employee's peer key employees
         of the Company and its affiliated companies.

                           (vi) Vacation. During the Employment Period, the
         Employee shall be entitled to at least 3 weeks paid vacation or such
         greater amount of paid vacation as may be applicable to the Employee's
         peer key employees of the Company and its affiliated companies.

                           (vii) Deferred Compensation Plan. During the
         Employment Period, the Employee shall be entitled to continue to
         participate in any deferred compensation or similar plans in which the
         Employee was participating in prior to the Employment Period subject to
         such changes thereto as may be necessary to reflect the effect of the
         Change of Control.

                                       3
<PAGE>   4

         4. Termination of Employment.

                  (a) Death or Disability. The Employee's employment shall
terminate automatically upon the Employee's death during the Employment Period.
If the Company determines in good faith that the Disability of the Employee has
occurred during the Employment Period (pursuant to the definition of Disability
set forth below), it may give to the Employee written notice in accordance with
Section 11(b) of this Agreement of its intention to terminate the Employee's
employment. In such event, the Employee's employment with the Company shall
terminate effective 30 days after receipt of such notice by the Employee (the
"Disability Effective Date"), provided that within the 30-day period after such
receipt, the Employee shall not have returned to full-time performance of the
Employee's duties. For purposes of this Agreement, "Disability" shall mean the
absence of the Employee from the Employee's duties with the Company on a
full-time basis for 180 calendar days as a result of incapacity due to mental or
physical illness which is determined to be total and permanent by a physician
selected by the Company or its insurers and acceptable to the Employee or the
Employee's legal representative.

                  (b) Cause. The Company may terminate the Employee's employment
during the Employment Period for Cause. For purposes of this Agreement, "Cause"
shall mean:

                           (i) the willful and continued failure of the Employee
to perform substantially the Employee's duties with the Company or one of its
affiliates (other than any such failure resulting from incapacity due to
physical or mental illness), after a written demand for substantial performance
is delivered to the Employee by the Company which specifically identifies the
manner in which the Employee has not substantially performed the Employee's
duties; or

                           (ii) the willful engaging by the Employee in illegal
conduct or gross misconduct which is materially and demonstrably injurious to
the Company.

                  For purposes of this provision, no act, or failure to act, on
the part of the Employee shall be considered "willful" unless it is done, or
omitted to be done, by the Employee in bad faith or without reasonable belief
that the Employee's action or omission was in the best interests of the Company.
Any act, or failure to act, based upon authority given pursuant to a resolution
duly adopted by the Board or upon the instructions of the Chief Executive
Officer or of a senior officer of the Company or based upon the advice of
counsel for the Company shall be conclusively presumed to be done, or omitted to
be done, by the Employee in good faith and in the best interests of the Company.

                  (c) Good Reason. The Employee's employment may be terminated
by the Employee during the Employment Period for Good Reason. For purposes of
this Agreement, "Good Reason" shall mean:

                           (i) the assignment to the Employee of any duties
         inconsistent in any respect with the Employee's position (including
         status, offices, titles and reporting requirements), authority, duties
         or responsibilities as contemplated by Section 3(a) of this Agreement,
         or any other action by the Company which results in a diminution in
         such position, authority, duties or responsibilities, excluding for
         this purpose an isolated, insubstantial and inadvertent action not
         taken in bad faith and which is remedied by the Company promptly after
         receipt of notice thereof given by the Employee;

                           (ii) any failure by the Company to comply with any of
         the provisions of Section 3(b) of this Agreement, other than an
         isolated, insubstantial and inadvertent failure not occurring in bad
         faith and which is remedied by the Company promptly after receipt of
         notice thereof given by the Employee;

                                       4
<PAGE>   5

                           (iii) the Company's requiring the Employee to be
         based at any office or location other than as provided in Section
         3(a)(i)(B) hereof or the Company's requiring the Employee to travel on
         Company business to a substantially greater extent than required
         immediately prior to the Effective Date;

                           (iv) any purported termination by the Company of the
         Employee's employment otherwise than as expressly permitted by this
         Agreement; or

                           (v) any failure by the Company to comply with and
         satisfy Section 10(c) of this Agreement.

                  For purposes of this Section 4(c), any good faith
determination of "Good Reason" made by the Employee shall be conclusive.

                  (d) Notice of Termination. Any termination during the
Employment Period by the Company for Cause, or by the Employee for Good Reason,
shall be communicated by Notice of Termination to the other party hereto given
in accordance with Section 11(b) of the Agreement. For purposes of this
Agreement, a "Notice of Termination" means a written notice which (i) indicates
the specific termination provision in this Agreement relied upon, (ii) to the
extent applicable, sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Employee's employment under
the provision so indicated and (iii) if the Date of Termination (as defined
below) is other than the date of receipt of such notice, specifies the
termination date (which date, in the case of a notice by the Company, shall be
not more than 30 days after the giving of such notice). The failure by the
Employee or the Company to set forth in the Notice of Termination any fact or
circumstance which contributes to a showing of Good Reason or Cause shall not
waive any right of the Employee or the Company, respectively, from asserting
such fact or circumstance in enforcing the Employee's or the Company's rights
hereunder.

                  (e) Date of Termination.  "Date of Termination" shall mean:

                           (i) if the Employee's employment is terminated by the
         Company for Cause, or by the Employee for Good Reason, the date of
         receipt of the Notice of Termination or any later date specified
         therein, as the case may be;

                           (ii) if the Employee's employment is terminated by
         the Company other than for Cause, death or Disability, the Date of
         Termination shall be the date on which the Company notifies the
         Employee of such termination; and

                           (iii) if the Employee's employment is terminated by
         reason of death or Disability, the Date of Termination shall be the
         date of death of the Employee or the Disability Effective Date, as the
         case may be.

         5. Obligations of the Company Upon Termination.

                  (a) Good Reason; Other than For Cause, Death or Disability.
If, during the Employment Period, the Company terminates the Employee's
employment other than for Cause, death or Disability, or the Employee terminates
employment for Good Reason:

                           (i) The Company shall pay to the Employee in a lump
         sum in cash within 30 days after the Date of Termination the aggregate
         of the following amounts:

                                       5
<PAGE>   6

                                    (A) the sum of (1) the Employee's Annual
                  Base Salary through the Date of Termination to the extent not
                  theretofore paid, (2) the product of (x) the higher of (I) the
                  highest Annual Bonus received by the Employee over the
                  preceding three year period and (II) the Annual Bonus that
                  would be payable in respect of the current fiscal year, if any
                  (such higher amount being referred to as the "Highest Annual
                  Bonus") and (y) a fraction, the numerator of which is the
                  number of days in the current fiscal year through the Date of
                  Termination, and the denominator of which is 365, and (3) any
                  compensation previously deferred by the Employee under a plan
                  sponsored by the Company (together with any accrued interest
                  or earnings thereon), and any accrued vacation pay, in each
                  case to the extent not theretofore paid (the sum of the
                  amounts described in clauses (1), (2) and (3) shall be
                  hereinafter referred to as the "Accrued Obligations"); and

                                    (B) an amount equal to two times the sum of
                  (i) the then current Annual Base Salary of the Employee and
                  (ii) the Highest Annual Bonus; and

                                    (C) an amount equal to the total of the
                  employer basic and matching contributions credited to the
                  Employee under the Company's 401(k) Savings Plan (the "401(k)
                  Plan") and any other deferred compensation plan during the
                  12-month period immediately preceding the month of the
                  Employee's Date of Termination multiplied by two, such amount
                  to be grossed up so that the amount the Employee actually
                  receives after payment of any federal or state taxes payable
                  thereon equals the amount first described above; and

                                    (D) an amount equal to two times the total
                  amount of all fringe benefits received by Employee on an
                  annualized basis.

                           (ii) For a period of two years from the Employee's
         Date of Termination or such longer period as may be provided by the
         terms of the appropriate plan, program, practice or policy, the Company
         shall continue benefits to the Employee and/or the Employee's family
         equal to those which would have been provided to them in accordance
         with the plans, programs, practices and policies described in Section
         3(b)(iv) of this Agreement if the Employee's employment had not been
         terminated; provided, however, that with respect to any of such plans,
         programs, practices or policies requiring an employee contribution, the
         Employee shall continue to pay the monthly employee contribution for
         same, and provided further, that if the Employee becomes re-employed by
         another employer and is eligible to receive medical or other welfare
         benefits under another employer provided plan, the medical and other
         welfare benefits described herein shall be secondary to those provided
         under such other plan during such applicable period of eligibility;

                           (iii) All benefits and amounts under the Company's
         deferred compensation plan and the 401(k) Plan and any other similar
         plans, including any stock options held by the Employee, not already
         vested shall be 100% vested;

                           (iv) To the extent not theretofore paid or provided,
         the Company shall timely pay or provide to the Employee any other
         amounts or benefits required to be paid or provided or which the
         Employee is eligible to receive under any plan, program, policy or
         practice or contract or agreement of the Company and its affiliated
         companies (such other amounts and benefits shall be hereinafter
         referred to as the "Other Benefits"); and

                           (v) The foregoing payments are intended to compensate
         the Employee for a breach of the Company's obligations and place
         Employee in substantially the same position had the employment of the
         Employee not been so terminated as a result of a breach by the Company.
         The

                                       6
<PAGE>   7

         payments shall be in lieu of any other severance payments that might be
         due to the Employee under the Company's severance and other similar
         plans.

                  (b) Death. If Employee's employment is terminated by reason of
the Employee's death during the Employment Period, this Agreement shall
terminate without further obligations to the Employee's legal representatives
under this Agreement, other than for payment of Accrued Obligations and the
timely payment or provision of Other Benefits. Accrued Obligations shall be paid
to the Employee's estate or beneficiaries, as applicable, in a lump sum in cash
within 30 days after the Date of Termination.

                  (c) Disability. If the Employee's employment is terminated by
reason of the Employee's Disability during the Employment Period, this Agreement
shall terminate without further obligations to the Employee, other than for
payment of Accrued Obligations and the timely payment or provision of Other
Benefits. Accrued Obligations shall be paid to the Employee in a lump sum in
cash within 30 days after the Date of Termination.

                  (d) Cause; Other Than for Good Reason. If the Employee's
employment is terminated for Cause during the Employment Period, this Agreement
shall terminate without further obligations to the Employee under this
Agreement, other than the obligation to pay to the Employee (x) his or her
Annual Base Salary through the Date of Termination, (y) the amount of any
compensation previously deferred by the Employee, and (z) Other Benefits, in
each case to the extent theretofore unpaid. If the Employee voluntarily
terminates employment during the Employment Period, excluding a termination for
Good Reason, this Agreement shall terminate without further obligations to the
Employee under this Agreement, other than for Accrued Obligations and the timely
payment or provision of Other Benefits. In such case, all Accrued Obligations
shall be paid to the Employee in a lump sum in cash within 30 days after the
Date of Termination subject to such other options or restrictions as provided by
law.

         6. Other Rights. Except as provided hereinafter, nothing in this
Agreement shall prevent or limit the Employee's continuing or future
participation in any plan, program, policy or practice provided by the Company
or any of its affiliated companies and for which the Employee may qualify, nor
shall anything herein limit or otherwise affect such rights as the Employee may
have under any contract or agreement with the Company or any of its affiliated
companies. Except as provided hereinafter, amounts which are vested benefits or
which the Employee is otherwise entitled to receive under any plan, policy,
practice or program of or any contract or agreement with the Company or any of
its affiliated companies at or subsequent to the Date of Termination shall be
payable in accordance with such plan, policy, practice or program or contract or
agreement. It is expressly agreed by the Employee that he or she shall have no
right to receive, and hereby waives any entitlement to, any severance pay or
similar benefit under any other plan, policy, practice or program of the
Company. In addition, if the Employee has an employment or similar agreement
with the Company at the Date of Termination, he or she agrees that he or she
shall have the right to receive all of the benefits provided under this
Agreement or such other agreement, whichever one, in its entirety, the Employee
chooses, but not both agreements, and when the Employee has made such election,
the other agreement shall be superseded in its entirety and shall be of no
further force and effect. The Employee also agrees that to the extent he or she
may be eligible for any severance pay or similar benefit under any laws
providing for severance or termination benefits, such other severance pay or
similar benefit shall be coordinated with the benefits owed hereunder, such that
the Employee shall not receive duplicate benefits.

                                       7
<PAGE>   8

         7. Full Settlement.

                  (a) No Rights of Offset. The Company's obligation to make the
payments provided for in this Agreement and otherwise to perform its obligations
hereunder shall not be affected by any set-off, counterclaim, recoupment,
defense or other claim, right or action which the Company may have against the
Employee or others.

                  (b) No Mitigation Required. In no event shall the Employee be
obligated to seek other employment or take any other action by way of mitigation
of the amounts payable to the Employee under any of the provisions of this
Agreement and such amounts shall not be reduced whether or not the Employee
obtains other employment.

                  (c) Legal Fees. The Company agrees to pay as incurred, to the
full extent permitted by law, all legal fees and expenses which the Employee may
reasonably incur as a result of any contest (regardless of the outcome thereof)
by the Company or the Employee of the validity or enforceability of, or
liability under, any provision of this Agreement or any guarantee of performance
thereto (including as a result of any contest by the Employee about the amount
of any payment pursuant to this Agreement), plus in each case interest on any
delayed payment at the applicable Federal rate provided for in Section
7872(f)(2)(A) of the Internal Revenue Code of 1986, as amended (the "Code").

         8. Certain Additional Payments by the Company.

                  (a) Anything in this Agreement to the contrary notwithstanding
and except as set forth below, in the event it shall be determined that any
payment or distribution by the Company to or for the benefit of the Employee
(whether paid or payable or distributed or distributable pursuant to the terms
of this Agreement or otherwise, but determined without regard to any additional
payments required under this Section 8) (a "Payment") would be subject to the
excise tax imposed by Section 4999 of the Code or any interest or penalties are
incurred by the Employee with respect to such excise tax (such excise tax,
together with any such interest and penalties, are hereinafter collectively
referred to as the "Excise Tax"), then the Employee shall be entitled to receive
an additional payment (a "Gross-Up Payment") in an amount such that after
payment by the Employee of all taxes (including any interest or penalties
imposed with respect to such taxes), including without limitation, any income
taxes (and any interest and penalties imposed with respect thereto) and Excise
Tax imposed upon the Gross-Up Payment, the Employee retains an amount of the
Gross-Up Payment equal to the Excise Tax imposed upon the Payments.
Notwithstanding the foregoing provisions of this Section 8(a), if it shall be
determined that the Employee is entitled to a Gross-Up Payment, but that the
Employee, after taking into account the Payments and the Gross-Up Payment, would
not receive a net after-tax benefit of at least $1,000 (taking into account both
income taxes and any Excise Tax) as compared to the net after-tax proceeds to
the Employee resulting from an elimination of the Gross-Up Payment and a
reduction of the Payments, in the aggregate, to an amount (the "Reduced Amount")
such that the receipt of Payments would not give rise to any Excise Tax, then no
Gross-Up Payment shall be made to the Employee and the Payments, in the
aggregate, shall be reduced to the Reduced Amount.

                  (b) Subject to the provisions of Section 8(c), all
determinations required to be made under this Section 8, including whether and
when a Gross-Up Payment is required and the amount of such Gross-Up Payment and
the assumptions to be utilized in arriving at such determination shall be made
by Arthur Andersen LLP or, as provided below, such other certified public
accounting firm as may be designated by the Employee (the "Accounting Firm")
which shall provide detailed supporting calculations both to the Company and the
Employee within 15 business days after the receipt of notice from the Employee
that there has been a Payment, or such earlier time as is requested by the
Company. In the event that the Accounting Firm is serving as accountant or
auditor for the individual, entity or group effecting the Change of Control, the
Employee shall appoint another nationally recognized accounting firm to make the
determinations required hereunder (which

                                       8
<PAGE>   9

accounting firm shall then be referred to as the Accounting Firm hereunder). All
fees and expenses of the Accounting Firm shall be borne solely by the Company.
Any Gross-Up Payment, as determined pursuant to this Section 8, shall be paid by
the Company to the Employee within five days after the receipt of the Accounting
Firm's determination. Any determination by the Accounting Firm shall be binding
upon the Company and the Employee. As a result of the uncertainty in the
application of Section 4999 of the Code at the time of the initial determination
by the Accounting Firm hereunder, it is possible that Gross-Up Payments which
will not have been made by the Company should have been made ("Underpayment"),
consistent with the calculations required to be made hereunder. In the event
that the Company exhausts its remedies pursuant to Section 8(c) and the Employee
thereafter is required to make a payment of any Excise Tax, the Accounting Firm
shall determine the amount of the Underpayment that has occurred and any such
Underpayment shall be promptly paid by the Company to or for the benefit of the
Employee.

                  (c) The Employee shall notify the Company in writing of any
claim by the Internal Revenue Service that, if successful, would require the
payment by the Company of the Gross-Up Payment (or an additional Gross-Up
Payment) in the event the IRS seeks higher payment. Such notification shall be
given as soon as practicable, but no later than ten business days after the
Employee is informed in writing of such claim, and shall apprise the Company of
the nature of such claim and the date on which such claim is requested to be
paid. The Employee shall not pay such claim prior to the expiration of the
30-day period following the date on which he gives such notice to the Company
(or such shorter period ending on the date that any payment of taxes with
respect to such claim is due). If the Company notifies the Employee in writing
prior to the expiration of such period that it desires to contest such claim,
the Employee shall:

                           (i) give the Company any information reasonably
         requested by the Company relating to such claim,

                           (ii) take such action in connection with contesting
         such claim as the Company shall reasonably request in writing from time
         to time, including without limitation, accepting legal representation
         with respect to such claim by an attorney reasonably selected by the
         Company,

                           (iii) cooperate with the Company in good faith in
         order to effectively contest such claim, and

                           (iv) permit the Company to participate in any
         proceedings relating to such claims; provided, however, that the
         Company shall bear and pay directly all costs and expenses (including
         additional interest and penalties) incurred in connection with such
         costs and shall indemnify and hold the Employee harmless, on an
         after-tax basis, for any Excise Tax or income tax (including interest
         and penalties with respect thereto) imposed as a result of such
         representation and payment of costs and expenses. Without limitation on
         the foregoing provisions of this Section 8(c), the Company shall
         control all proceedings taken in connection with such contest and, at
         its sole option, may pursue or forego any and all administrative
         appeals, proceedings, hearings and conferences with the taxing
         authority in respect of such claim and may, at its sole option, either
         direct the Employee to pay the tax claimed and sue for a refund or
         contest the claim in any permissible manner, and the Employee agrees to
         prosecute such contest to determination before any administrative
         tribunal, in a court of initial jurisdiction and in one or more
         appellate courts, as the Company shall determine; provided, however,
         that if the Company directs the Employee to pay such claim and sue for
         a refund, the Company shall advance the amount of such payment to the
         Employee, on an interest-free basis and shall indemnify and hold the
         Employee harmless, on an after-tax basis, from any Excise Tax or income
         tax (including interest or penalties with respect thereto) imposed with
         respect to such advance or with respect to any imputed income with
         respect to such advance; and further provided that any extension of the
         statute of limitations relating to payment of taxes for the taxable
         year of the Employee with respect to which such contested amount is
         claimed to be due is limited solely to such contested amount.
         Furthermore,

                                       9
<PAGE>   10

         the Company's control of the contest shall be limited to issues with
         respect to which a Gross-Up Payment would be payable hereunder and the
         Employee shall be entitled to settle or contest, as the case may be,
         any other issues raised by the Internal Revenue Service or any other
         taxing authority.

                  (d) If, after the receipt by the Employee of an amount
advanced by the Company pursuant to Section 8(c), the Employee becomes entitled
to receive any refund with respect to such claim, the Employee shall (subject to
the Company's complying with the requirements of Section 8(c)) promptly pay to
the Company the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto). If, after the receipt by the
Employee of an amount advanced by the Company pursuant to Section 8(c), a
determination is made that the Employee shall not be entitled to any refund with
respect to such claim and the Company does not notify the Employee in writing of
its intent to contest such denial of refund prior to the expiration of 30 days
after such determination, then such advance shall be forgiven and shall not be
required to be repaid and the amount of such advance shall offset, to the extent
thereof, the amount of Gross-Up Payment required to be paid.

         9. Confidential Information. The Employee shall hold in a fiduciary
capacity for the benefit of the Company all secret or confidential information,
knowledge or data relating to the Company or any of its affiliated companies,
and their respective businesses, which shall have been obtained by the Employee
during the Employee's employment by the Company or any of its affiliated
companies, provided that it shall not apply to information which is or shall
become public knowledge (other than by acts by the Employee or representatives
of the Employee in violation of this Agreement), information that is developed
by the Employee independently of such information, or knowledge or data or
information that is disclosed to the Employee by a third party under no
obligation of confidentiality to the Company. After termination of the
Employee's employment with the Company, the Employee shall not, without the
prior written consent of the Company or as may otherwise be required by law or
legal process, communicate or divulge any such information, knowledge or data to
anyone other than the Company and those designated by it. In no event shall an
asserted violation of the provisions of this Section 9 constitute a basis for
deferring or withholding any amounts otherwise payable to the Employee under
this Agreement.

         10.  Successors.

                  (a) This Agreement is personal to the Employee and shall not
be assignable by the Employee otherwise than by will or the laws of descent and
distribution. This Agreement shall inure to the benefit of and be enforceable by
the Employee's legal representatives.

                  (b) This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns.

                  (c) The Company will require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, "Company" shall mean the Company as
hereinbefore defined and any successor to its business and/or assets as
aforesaid which assumes and agrees to perform this Agreement by operation of
law, or otherwise.

         11.      Miscellaneous.

                  (a) THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF TEXAS, WITHOUT REFERENCE TO PRINCIPLES
OF CONFLICT OF LAWS. The captions of this Agreement are not part of the
provisions

                                       10
<PAGE>   11

hereof and shall have no force or effect. This Agreement may not be amended or
modified otherwise than by a written agreement executed by the parties hereto or
their respective successors and legal representatives.

                  (b) All notices and other communications hereunder shall be in
writing and shall be given by hand delivery to the other party or by registered
or certified mail, return receipt requested, postage prepaid, addressed as
follows:

                  If to the Employee:           Burt M. Martin
                                                4802 Bellview
                                                Bellaire, Texas 77401

                  If to the Company:            Weatherford International, Inc.
                                                515 Post Oak Blvd., Suite 600
                                                Houston, Texas 77027
                                                Attention: General Counsel

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notices and communications shall be effective
when actually received by the addressee.

                  (c) The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

                  (d) The Company may withhold from any amounts payable under
this Agreement such Federal, state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or regulation.

                  (e) The Employee's or the Company's failure to insist upon
strict compliance with any provision of this Agreement or the failure to assert
any right the Employee or the Company may have hereunder, including without
limitation, the right of the Employee to terminate employment for Good Reason
pursuant to Section 4(c)(i)-(v) of this Agreement, shall not be deemed to be a
waiver of such provision or right or any other provision or right of this
Agreement.

                                       11
<PAGE>   12

         IN WITNESS WHEREOF, the Employee has hereunto set the Employee's hand
and, pursuant to the authorization from its Board of Directors, the Company has
caused these presents to be executed in its name and on its behalf, all as of
the day and year first above written.

                                                /S/ BURT M. MARTIN
                                      -----------------------------------------
                                                     Burt M. Martin

                                       WEATHERFORD INTERNATIONAL, INC.

                                       By      /S/ CURTIS W. HUFF
                                          --------------------------------------
                                                Curtis W. Huff
                                             Senior Vice President

                                       12

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