Exhibit 10.9
DRESSER-RAND GROUP INC.
STANDARD TERMS AND CONDITIONS FOR
RESTRICTED STOCK
These Standard Terms and Conditions apply to any Award of restricted Common
Shares (the “Restricted Shares”) granted to an employee of the Company under the
Dresser-Rand Group Inc. 2008 Stock Incentive Plan, as amended (the “Plan”), on
or after January 1, 2010, which are evidenced by a Grant Notice or an action of
the Committee that specifically refers to these Standard Terms and Conditions.

1.  
TERMS OF RESTRICTED SHARES

Dresser-Rand Group Inc., a Delaware corporation (the “Company”) has granted to
the Grantee named in the Grant Notice provided to said Grantee herewith (the
“Grant Notice”) an award of a number of Restricted Shares (the “Award”) of the
Company’s common stock, $0.01 par value per share specified in the Grant Notice.
The Award is the terms and subject to the conditions set forth in the Grant
Notice, these Standard Terms and Conditions, and the Plan, each as amended from
time to time. For purposes of these Standard Terms and Conditions and the Grant
Notice, any reference to the Company shall, unless the context requires
otherwise, include a reference to any Affiliate, as such term is defined in the
Plan. Capitalized terms not defined in this document have the meaning given to
them in Plan or Grant Notice.

2.  
VESTING OF RESTRICTED STOCK

The Restricted Shares are subject to forfeiture and may not be sold, assigned,
transferred, pledged or otherwise directly or indirectly encumbered or disposed
of (collectively, “Transferred”) until the expiration of a “Period of
Restriction” specified in the Grant Notice. Except as otherwise provided herein,
the Period of Restriction shall expire on each of the dates set forth in the
Grant Notice as long as the Grantee remains an employee of the Company or other
service provider to the Company on the applicable vesting date.
Notwithstanding anything contained in these Standard Terms and Conditions to the
contrary:

  A.  
If the Grantee’s employment terminates by reason of death or Disability during
the Period of Restriction, a pro rata portion of the Restricted Shares subject
to the next vesting date shall become nonforfeitable, and unless otherwise
determined by the Committee, the remaining Restricted Shares shall be forfeited
as of the date of such termination. For this purpose, “pro-rata portion” means a
percentage, where the numerator is the number of days between (a) the later of
the grant date or last vesting date and (b) the Grantee’s termination, and the
denominator is the number of days between (y) the later of the grant date or the
last vesting date and (z) the final vesting date.

 

 

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  B.  
Subject to Section 8, if the Grantee’s employment terminates due to the
Grantee’s Retirement (as defined in Section 16.F below), the Restricted Shares
shall continue to vest and become nonforfeitable under the schedule described in
the Grant Notice; provided, however, that if the Grantee’s Retirement is less
than twelve (12) months after the Grant Date, only the following portion of the
Restricted Shares shall continue to vest under the schedule described in the
Grant Notice: (x) the number of Restricted Shares granted hereunder,
(y) multiplied by a fraction, (I) the numerator of which is the number of full
days from the Grant Date through the date of Retirement, and (II) the
denominator of which is 365. The remaining Restricted Shares shall be forfeited
as of the date of such Retirement.

  C.  
If the Grantee’s employment terminates for any reason other than death,
Disability or Retirement, any Restricted Shares held by the Grantee for which
the Period of Restriction has not then expired shall be forfeited as of the date
of such termination.

3.  
RIGHTS AS STOCKHOLDER/LEGEND

The Grantee shall have the right to vote the Restricted Shares, but shall
otherwise enjoy none of the rights of a stockholder (including the right to
receive dividends or equivalent payments) during the Period of Restriction.
The Restricted Shares shall be registered in the Grantee’s name on the Grant
Date through a book entry credit in the records of the Company’s transfer agent,
but shall be recorded as restricted non-dividend paying shares of Common Shares
until the expiration of the Period of Restriction. Upon the expiration of the
Period of Restriction with respect to any Restricted Shares, the Company shall
instruct its transfer agent to record such shares as unrestricted. In the event
any stock certificates are issued in respect of the Restricted Shares during the
Period of Restriction, such certificates shall bear a restrictive legend
determined by the Committee until the expiration of the Period of Restriction
with respect to such shares.

4.  
CHANGE IN CONTROL

Unless otherwise provided in an employment, severance or other agreement between
the Company and the Grantee, the Committee shall determine the effect of a
Change in Control on the Restricted Shares. Without limitation, the Committee
may provide for the acceleration of vesting of, or the lapse of transfer or
other similar restrictions on, any unvested Restricted Shares or for the
assumption or substitution of Restricted Shares by the Grantee’s employer (or
the parent or an Affiliate of such employer) or other service recipient that
engages the Grantee immediately following the Change in Control.

 

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5.  
RESTRICTIONS ON RESALES OF SHARES

The Company may impose such restrictions, conditions or limitations as it
determines appropriate as to the timing and manner of any resales by the Grantee
or other subsequent transfers by the Grantee of any Restricted Shares, including
without limitation (a) restrictions under an insider trading policy,
(b) restrictions designed to delay and/or coordinate the timing and manner of
sales by the Grantee and other holders and (c) restrictions as to the use of a
specified brokerage firm for such resales or other transfers.

6.  
INCOME TAXES

The Company shall not instruct the transfer agent to remove the restrictions
applicable to any Restricted Shares at the expiration of the Period of
Restriction unless and until the Grantee has made arrangements satisfactory to
the Committee to satisfy applicable withholding tax obligations. Unless
otherwise permitted by the Committee, withholding shall be effected by
withholding Common Shares that vest on the applicable vesting date. The Grantee
acknowledges that the Company shall have the right to deduct any taxes required
to be withheld by law in connection with the vesting of the Restricted Shares
from any amounts payable by it to the Grantee (including, without limitation,
future cash wages).

7.  
NON-TRANSFERABILITY OF AWARD

The Grantee represents and warrants that the Restricted Shares are being
acquired by the Grantee solely for the Grantee’s own account for investment and
not with a view to or for sale in connection with any distribution thereof. The
Grantee further understands, acknowledges and agrees that, except as otherwise
provided in the Plan, prior to their vesting, the Restricted Shares may not be
sold, assigned, transferred, pledged or otherwise directly or indirectly
encumbered or disposed of except to the extent expressly permitted hereby and at
all times in compliance with the U.S. Securities Act of 1933, as amended, and
the rules and regulations of the Securities Exchange Commission thereunder, and
in compliance with applicable state securities or “blue sky” laws and non-U.S.
securities laws. Unless permitted by the Committee, prior to their vesting, the
Restricted Shares may not be sold, transferred, pledged, assigned, or otherwise
alienated or hypothecated by the Grantee other than by will or the laws of
descent and distribution.

 

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8.  
RESTRICTED ACTIVITIES

  A.  
By accepting the Restricted Shares, the Grantee acknowledges and agrees that
(i) the Company is engaged in a highly competitive business; (ii) the Company
has expended considerable time and resources to develop goodwill with its
customers, vendors, and others, and to create, protect, and exploit its
Confidential Information (as defined in Section 16.B below); (iii) the Company
must continue to prevent the dilution of its goodwill and unauthorized use or
disclosure of its Confidential Information to avoid irreparable harm to its
legitimate business interests; (iv) the Grantee’s participation in or direction
of the Company’s day-to-day operations and strategic planning are an integral
part of the Company’s continued success and goodwill; (v) in the period between
the Grantee’s notice to the Committee of the Grantee’s Retirement and the date
of the Grantee’s Retirement (the “Transition Period”), the Grantee will
participate in identifying a successor, transitioning his or her
responsibilities to and training a successor, and engaging in other transition
activities (the “Transition Process”); (vi) given the Grantee’s position and
responsibilities, including during the Transition Period, he or she necessarily
will be relying on and/or creating Confidential Information that belongs to the
Company and enhances the Company’s goodwill; during the Transition Process will
be transmitting Confidential Information to his or her successor; and in
carrying out his or her responsibilities, including during the Transition
Process, the Grantee in turn will be relying on the Company’s goodwill and the
disclosure by the Company to him or her of Confidential Information; (vii) the
Grantee will have access to Confidential Information, including concerning the
Transition Process, that could be used by any competitor of the Company in a
manner that would irreparably harm the Company’s competitive position in the
marketplace and dilute its goodwill; (viii) the Grantee’s engaging in any of the
Restricted Activities during the Restriction Period would result in the
inevitable disclosure or use of Confidential Information for the Competitor’s
benefit or to the detriment of the Company; (ix) the Grantee will return to the
Company upon Retirement all the Confidential Information, in whatever form or
media and all copies thereof, in his or her possession, custody, or control;
(x) by giving advance notice of his or her Retirement, the Grantee represents
that he or she will not engage in the Restricted Activities; (xi) the Company is
relying on such representation in providing the Grantee continuing access to
Confidential Information and authorizing him or her to engage in the Transition
Process and other activities that will create new and additional Confidential
Information during the Transition Period; and (xi) absent the Grantee’s
agreement to this Section 8, the Company would not authorize the Grantee to
participate in the Transition Process and engage in other activities that
provide access to or create new and additional Confidential Information in an
unfettered fashion; and would not provide for the continued vesting of the
Restricted Shares upon Retirement as provided for in Section 2.

  B.  
The Company, by granting the Restricted Shares, and the Grantee, by accepting
the Restricted Shares, thus acknowledge and agree that during the remaining term
of the Grantee’s employment with the Company, including the Transition Period,
the Grantee (i) will receive Confidential Information that is unique,
proprietary, and valuable to the Company; (ii) will rely on and/or create
Confidential Information that is unique, proprietary, and valuable to the
Company; and (iii) will benefit, including without limitation by way of
increased earnings and earning capacity, from the goodwill the Company has
generated and from the Confidential Information.

 

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  C.  
Accordingly, in consideration of the promises of the Company set out in
Section 8.B, the Restricted Shares, and the extended vesting of the Restricted
Shares upon Retirement as provided for in Section 2, the Grantee agrees that:

  1.  
He or she will not engage in any of the Restricted Activities (as defined in
Section 16.D below) during the Restriction Period (as defined in Section 16.E
below);

  2.  
If he or she engages in, or threatens to engage in, any of the Restricted
Activities during the Restriction Period or otherwise violates his or her
obligations under this Section 8, then (x) the Restricted Shares held by the
Grantee shall immediately be forfeited and canceled (regardless of whether then
vested or unvested) and (y) with respect to any Restricted Shares that have been
Transferred, the Grantee shall, at the Company’s option, immediately pay to the
Company the fair market value of the Restricted Shares at the time of vesting;

  3.  
If he or she engages in, or threatens to engage in, any of the Restricted
Activities during the Restriction Period or otherwise violates his or her
obligations under this Section 8, the Company would not have an adequate remedy
at law and would be irreparably harmed and, accordingly, that the Company shall
be entitled to equitable relief, including preliminary and permanent injunctions
and specific performance, in the event the Grantee engages or threatens to
engage in any of the Restricted Activities during the Restriction Period or
otherwise violates his or her obligations under this Section 8, without the
necessity of posting any bond or proving special damages or irreparable injury;
and

  4.  
Neither Section 8.C.2 nor Section 8.C.3 constitute the Company’s exclusive
remedy for a breach or threatened breach of the Grantee’s obligations under this
Section 8, but shall be in addition to all other remedies available to the
Company at law or equity.

 

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  D.  
By accepting the Restricted Shares, the Grantee acknowledges and agrees that
(i) the restrictions contained in this Section 8 are ancillary to an otherwise
enforceable agreement, including without limitation the mutual promises and
undertakings set out in Section 8.A and B, the Restricted Shares, and the
continued vesting of all or a portion of the Restricted Shares upon Retirement
as provided for in Section 2; (ii) the Company’s promises and undertakings set
out in these Standard Terms and Conditions, and in particular Section 8.B, the
Grant Notice, and the Plan, and the Grantee’s position and responsibilities with
the Company and his or her promises and undertakings set out in Section 8.A,
give rise to the Company’s interest in restricting the Grantee’s post-Retirement
activities; (iii) such restrictions are designed to enforce the Grantee’s
promises and undertakings set out in Section 8.A and his or her common-law
obligations and duties owed to the Company; (iv) the restrictions are reasonable
and necessary, are valid and enforceable, and do not impose a greater restraint
than necessary to protect the Company’s goodwill, Confidential Information, and
other legitimate business interests; (v) he or she will immediately notify the
Company in writing should he or she believe or be advised that the provisions of
this Section 8 are not, or likely are not, valid and enforceable; (vi) he or she
will not challenge the enforceability of this Section 8; (vii) absent the
Grantee’s agreement to this Section 8, the Company would not authorize the
Grantee to participate in the Transition Process and engage in other activities
that provide access to or create new and additional Confidential Information in
an unfettered fashion; and would not provide for the continued vesting of all or
a portion of the Restricted Shares upon Retirement as provided for in Section 2.

  E.  
The provisions of Section 2 providing for the continued vesting of all or a
portion of the Restricted Shares upon Retirement and this Section 8 are mutually
dependent and not severable, and the Grantee acknowledges and agrees that the
Company would not provide for the continued vesting of all or a portion of the
Restricted Shares upon Retirement as provided for in Section 2 but for the
Grantee’s promises set out in and the enforceability of this Section 8.
Accordingly, if Section 8 or any part of it is ever declared to be illegal,
invalid, or otherwise unenforceable in any respect by a court of competent
jurisdiction, then the Grantee agrees that (x) the Restricted Shares held by the
Grantee shall immediately be forfeited and canceled (regardless of whether then
vested or unvested) and (y) with respect to any Restricted Shares that have been
Transferred, the Grantee shall, at the Company’s option, immediately pay to the
Company the fair market value of the Restricted Shares at the time of vesting;
provided that if the scope of the restrictions in this Section 8 as to time,
geography, or scope of activities are deemed by court of competent jurisdiction
to exceed the limitations permitted by applicable law, the Grantee and the
Company agree that the restrictions so deemed shall be, and are, automatically
reformed to the maximum limitation permitted by such law.

 

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9.  
THE PLAN AND OTHER AGREEMENTS

In addition to these Terms and Conditions, the Award shall be subject to the
terms of the Plan, which are incorporated into these Standard Terms and
Conditions by this reference. Certain capitalized terms not otherwise defined
herein are defined in the Plan. In the event of a conflict between the terms and
conditions of these Standard Terms and Condition and the Plan, the Plan
controls. Subject to the next paragraph, the Grant Notice, these Standard Terms
and Conditions and the Plan constitute the entire understanding between the
Grantee and the Company regarding the Award, and any prior agreements,
commitments or negotiations concerning the Award are superseded.
The Award (including the terms described herein) are subject to the provisions
of the Plan and, if the Grantee is outside the U.S., there may be an addendum
containing special terms and conditions applicable to grants in the Grantee’s
country. The grant of the Restricted Shares to any such Grantee is contingent
upon the Grantee executing and returning any such addendum in the manner
directed by the Company.

10.  
NOT A CONTRACT FOR EMPLOYMENT.

Nothing in the Plan, in the Grant Notice, these Standard Terms and Conditions or
any other instrument executed pursuant to the Plan shall confer upon the Grantee
any right to continue in the Company’s employ or service nor limit in any way
the Company’s right to terminate the Grantee’s employment or other service at
any time for any reason.

11.  
SEVERABILITY.

Except as provided for in Section 8.E, in the event that any provision of these
Standard Terms and Conditions is declared to be illegal, invalid or otherwise
unenforceable by a court of competent jurisdiction, such provision shall be
reformed, if possible, to the extent necessary to render it legal, valid and
enforceable, or otherwise deleted, and the remainder of these Standard Terms and
Conditions shall not be affected except to the extent necessary to reform or
delete such illegal, invalid or unenforceable provision.

12.  
HEADINGS.

The headings preceding the text of the sections hereof are inserted solely for
convenience of reference, and shall not constitute a part of these Standard
Terms and Conditions, nor shall they affect its meaning, construction or effect.

13.  
FURTHER ASSURANCES.

Each party shall cooperate and take such action as may be reasonably requested
by another party in order to carry out the provisions and purposes of these
Standard Terms and Conditions.

14.  
BINDING EFFECT.

These Standard Terms and Conditions shall inure to the benefit of and be binding
upon the parties hereto and their respective permitted heirs, beneficiaries,
successors and assigns.

 

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15.  
ELECTRONIC DELIVERY

By executing the Grant Notice, the Grantee hereby consents to the delivery of
information (including, without limitation, information required to be delivered
to the Grantee pursuant to applicable securities laws) regarding the Company and
the Affiliates the Plan, and the Restricted Shares via Company web site or other
electronic delivery.

16.  
DEFINITIONS

For purposes hereof, the following terms shall have the following meanings:

  A.  
“Competitor” shall mean any person or entity that carries on business activities
in competition with the activities of the Company, including but not limited to
(i) suppliers of rotating equipment, services and solutions for applications in
the oil, gas, petrochemical and process industries including for oil and gas
production; high-pressure gas injection, gas lift and other applications for
enhanced oil recovery; natural gas production and processing; gas liquefaction;
gas gathering, transmission and storage; hydrogen, wet and coker gas, synthesis
gas, carbon dioxide and other applications for the refining, fertilizer and
petrochemical markets; (ii) several applications for the armed forces;
(iii) applications for general industrial markets such as paper, steel, sugar,
and distributed and independent power generation; (iv) competing environmental
solutions such as compressed air energy storage, combined heat and power, air
separations, bio fuels, and wave or wind energy; or (v) servicing the Company’s
installed base of equipment, and the installed base of the Company’s class of
equipment of other suppliers through the provision of parts, repairs, overhauls,
operation and maintenance, upgrades, revamps, applied technology solutions,
coatings, field services, technical support and other extended services. The
term “Competitor” specifically includes but is not limited to the centrifugal
turbo and reciprocating compressor, steam turbine, rotating machinery, related
aftermarket parts and services (including repairs, revamps, re-rates, upgrades,
applied technology, overhauls, remanufacturing, installation and start-up) and
other competing businesses of (x) GE Oil & Gas/Nuovo Pignone, Siemens (including
TurboCare), Solar Turbines, Inc., Rolls-Royce Group plc, Elliott Company,
General Electric, Alstom, Mitsubishi Heavy Industries, Hitachi, MAN Turbo,
Hickham USA, Sulzer Turbo Services, Wood Group, Burckhardt Compression, Neuman &
Esser Group, Ariel Corp., Thomassen Mitsui & Co., Ltd., Ebara, Shin Nippon
Machinery Co. Ltd., Caterpillar Inc., Solar, Hoerbiger, or, if those corporate
names are not formally correct, the businesses commonly referred to by those
names; and (y) the successors to, assigns of, and affiliates of the persons or
entities described in clause (x).

 

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  B.  
“Confidential Information” shall mean, without limitation, all documents or
information, in whatever form or medium, or consisting of knowledge or
“know-how” whether or not recorded in any medium, concerning or evidencing
sales; costs; pricing; strategies; forecasts and long range plans; financial and
tax information; personnel information (including without limitation
compensation, other terms of employment, or performance other than as concerns
solely the Grantee); business, marketing and operational projections, plans, and
opportunities; and customer, vendor, and supplier information; but excluding any
such information that is or becomes generally available to the public other than
as a result of any unauthorized disclosure or breach of duty by the Grantee.

  C.  
“Noncompetition Area” shall mean the following geographic areas to the extent
the Grantee’s duties and responsibilities for the Company take or took place
anywhere in or are or were directed at any part of: (i) any foreign country in
which the Company has provided, sold, or installed its services, products, or
systems or has definitive plans to provide, sell, or install its services,
products, or systems during the Grantee’s employment by the Company; and
(ii) any state or territory of the United States of America.

  D.  
“Restricted Activities” means:

  1.  
The Grantee, whether on his or her own behalf or on behalf of any other
individual, partnership, firm, corporation, or business organization, either
directly or indirectly soliciting, inducing, persuading, or enticing, or
assisting another to solicit, induce, persuade, or entice, any person who is
then employed by or otherwise engaged to perform services for the Company, or
any person who at the time of the Grantee’s conduct had been employed by the
Company within the previous 12 months, to leave that employment or cease
performing those services;

  2.  
The Grantee, whether on his or her own behalf or on behalf of any other
individual, partnership, firm, corporation, or business organization, either
directly or indirectly soliciting, inducing, persuading, or enticing, or
assisting another to solicit, induce, persuade, or entice, any person or entity
who is then a customer, supplier, or vendor of the Company to cease being a
customer, supplier, or vendor of the Company or to divert all or any part of
such person’s or entity’s business from the Company; and

 

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  3.  
The Grantee, whether on his or her own behalf or on behalf of any other
individual, partnership, firm, corporation, or business organization, either
directly or indirectly soliciting, inducing, persuading, or enticing, or
assisting another to solicit, induce, persuade, or entice, any person or entity
who is a potential customer, supplier, or vendor of the Company, or at the time
of the Grantee’s conduct was a potential customer, supplier, or vendor of the
Company within the previous 12 months, not to become a customer, supplier, or
vendor of the Company or to divert all or any part of such person’s or entity’s
business from the Company; and

  4.  
The Grantee’s association directly or indirectly, as an employee, officer,
director, agent, partner, stockholder, owner, member, representative, financial
contributor, or consultant, with any Competitor.

With respect to the post-Retirement Restriction Period, the Restricted
Activities in D.2 and D.3 extend only to a customer, supplier, or vendor or
prospective customer, supplier, or vendor with respect to whom or whose business
the Grantee has or had Confidential Information (including without limitation
knowledge of or participation in a bid, proposal, or offer); and the Restricted
Activities in D.4 extend only to a (x) the performance by the Grantee, directly
or indirectly, of the same or similar activities the Grantee performed for the
Company prior to Retirement or such other activities that by their nature are
likely to lead to the disclosure of Confidential Information; and (y) that take
place anywhere in, or are directed at any part of, the Noncompetition Area. The
“Restricted Activities” do not extend to the Grantee’s investment in stock or
other securities of a Competitor listed on a national securities exchange or
actively traded in the over-the-counter market if he or she and the members of
his or her immediate family do not, directly or indirectly, hold more than a
total of 5% of all such shares of stock or other securities issued and
outstanding.

  E.  
“Restriction Period” shall mean the period of the Grantee’s employment by the
Company and continuing through the date that is three years after the Grantee’s
Retirement.

  F.  
“Retirement” shall mean the Grantee’s voluntary termination of employment or
other service from the Company after the Grantee has attained age sixty and
completed at least ten years of continuous service with the Company as of the
date of termination or has attained age sixty-five and completed at least five
years of continuous service and in either event with the express intent not to
engage in any of the Restricted Activities after termination, provided that the
Grantee has provided the Committee at least one year’s advance notice of such
retirement.

 

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