West8
Tower

    10205 Westheimer, Suite
1000

    Houston,
TX  77042

    Phone:
713-973-5389

    Fax:
713-973-5323

    Elizabeth
C. Powers

    VP
& Chief Administrative Officer

    


    


    


    November
14, 2008

    (Revised
December 3, 2008)

    (Revised
December 9, 2008)

    


    Walter J.
Nye

    Vice
President & General Manager Operations, European Served Area
(ESA)

    Dresser-Rand

    10205
Westheimer, Suite 1000

    Houston,
Texas 77042

    


    Dear
Walt;

    


    The
purpose of this letter is to confirm the benefits that will be provided to you
in return for your continued service beyond the date you initially communicated
to me for your resignation from Dresser-Rand subject to the conditions stated
below.

    


    Your
resignation from your role as Vice President and General Manager Operations, ESA
will be effective January 1, 2009.  In recognition of your willingness
to continue on in your role as we searched for your successor, I am pleased to
inform you that the Dresser-Rand Compensation Committee of the Board of
Directors has approved (a) a 2008 AIM incentive payment, the calculation of
which will be based on the greater of 2008 actual or target performance of the
AIM ESA Operations plan in which you currently participate, timed to coincide
with the Company’s normal AIM payment process and based on your actual months of
service in 2008, (b) the acceleration of the vesting of all of your outstanding
equity grants that would otherwise vest on February 15, 2009, to coincide with
your last day of employment with the Company, and (c) the extension of the
period during which you may exercise your vested stock appreciation rights to
January 1, 2010, including but not limited to those shown below. The awards
subject to vesting acceleration are as follows:

    
      ·  12,812
stock appreciation rights

      ·  3,414
restricted stock units

    

    


    The
Company will pay the cost of transporting a reasonable amount of personal
effects from Le Havre to Houston; provided that the amount of goods for which
the Company will pay is limited to 1100 pounds.  Moreover, the Company
will also pay other reasonable costs incurred in your repatriation back to
Houston.  However, the Company shall not pay in excess of $10,000 for
the aggregate of such transportation or other reasonable costs.  This
maximum does not include your personal airfare to return to
Houston.  Further, the Company’s Tax Equalization Program and
International Assignment Tax Program will continue to be made available to you
and shall apply with your termination date being January 1, 2009.

    


    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    The
effectiveness of this letter agreement and all of these benefits are conditioned
upon you signing the Company’s release and non-solicitation agreement and the
agreement being effective and not subject to revocation.

    


    Walt, I
would like to take this opportunity to thank you for your contributions to
Dresser-Rand over your 33 years of service.  On behalf of our Board of
Directors and our Executive Leadership Team, it has been a great pleasure
working with you.

    


    


    Very
Truly Yours,

     

    


    /s/ Elizabeth C. Powers

    
      
        
Elizabeth
C. Powers

    

    Vice
President and Chief Administrative Officer

    


    


     

    Acknowledged and Agreed this
15th
day of December,
2008.

    


    


    


    /s/ Walter J. Nye

    
      
Walter J.
Nye