2005 ROWAN COMPANIES, INC. LONG-TERM INCENTIVE PLAN PERFORMANCE SHARE AWARD AGREEMENT

THIS PERFORMANCE SHARE AWARD AGREEMENT (this “Agreement”) is made as of the ____ day of ______ (“Award Date”) between Rowan Companies, Inc., a Delaware corporation (the “Company”) and [name]   (“Participant”).

1.   Agreement to Grant Performance Shares .    Subject to the conditions described in this Agreement and the 2005 Rowan Companies, Inc. Long-Term Incentive Plan (the “Plan”), the Company hereby agrees to grant shares of common stock, $0.125 par value per share, of the Company (“Stock”) to Participant in consideration for services to be performed and contingent upon the occurrence of certain events as set forth herein. Prior to the actual issuance of such shares, Participant shall have no rights as a shareholder pursuant to this Agreement including but not limited to any rights to receive or accrue dividends with respect to such shares or the right to vote such shares.

2.   Definitions . For purposes of this Agreement, the following terms shall have the following meaning:

“Average Stock Price” means the average of the closing prices for the Stock or the common stock of each of the Peer Group Companies on each of the twenty-five (25) trading days immediately preceding the date of the determination.

“Committee” means the Compensation Committee of the Board of Directors of the Company.

“Peer Group Companies” means the companies listed on Appendix A attached hereto.

“Performance Period” means a period of three years beginning on the Award Date and ending on the third anniversary thereof.

“Relative TSR Rank” means the Total Shareholder Return of the Stock and the Total Shareholder Return of the common stock of each of the Peer Group Companies ranked in descending order. Relative TSR Rank shall be expressed as a number from one to seven with the number one (1) representing the highest Relative TSR Rank and seven (7) the lowest.

“Retirement”  by an Employee shall have occurred if:

(a)   in the case of an Employee who is an employee of Rowan Companies, Inc. or an employee of an Employing Company, as defined in the Rowan Pension Plan (the “Rowan Plan”), the Employee: (1) has satisfied the requirements for normal retirement pursuant to the rules of the Rowan Plan which, in terms of age, is a minimum of 60 and (2) has requested and received authorization from the administrative committee appointed by the Company’s Board of Directors to administer the Rowan Plan to commence receiving pension benefits; or

(b)   in the case of an Employee who is an employee of LeTourneau, Inc. or an employee of an Employing Company, as defined in the LeTourneau Pension Plan (the “LeTourneau Plan”), the Employee: (1) has satisfied the requirements for either normal or late retirement pursuant to the rules of the LeTourneau Plan, (2) has requested and received authorization from the administrative committee appointed by the Board of Directors of LeTourneau, Inc. to administer the LeTourneau Plan to commence receiving pension benefits, and (3) would have satisfied the requirements for normal retirement pursuant to the rules of the Rowan Plan if he or she was an employee of Rowan Companies, Inc. or an employee of an Employing Company under the Rowan Plan.

Determination of the date of termination of employment by reason of Retirement shall be based on such evidence as the Committee may require and a determination by the Committee of such date of termination shall be final and controlling on all interested parties.

“Target Shares” means the number of shares of Stock that will be transferred to Participant if the Relative TSR Rank of the Stock is four (4) and Total Shareholder Return is equal to one (1) or greater. Participant’s Target Shares shall be set forth in paragraph 3 below.

“Total Shareholder Return” or “TSR” means ^x ∕ _y where:

x = the sum of (i) the difference between the Average Stock Price as of the last trading day of the Performance Period and the Average Stock Price as of the first day of the Performance Period; and (ii) all dividends paid on the Stock during the Performance Period; and

y = the Average Stock Price as of the first day of the Performance Period.

All capitalized terms not otherwise defined herein shall have the meanings set forth in the Plan, the terms of which are incorporated herein by reference.

3.   Determination of Performance Shares . Provided that Participant is continuously employed by the Company throughout the Performance Period as soon as administratively feasible, but not later than seventy-five (75) days after the last day of the Performance Period, the Company shall transfer to Participant a number of shares of Stock to be determined as a percentage of the Target Shares based on the Relative TSR Rank according to the following chart.

Participant’s Target Shares = [number].

4.   Retirement, Disability, Death, or Change of Control . Except as otherwise provided below, in the event that Participant’s employment with the Company terminates prior to the last day of the Performance Period for any reason other than Retirement, Disability or death, this Agreement shall terminate and all rights of Participant to receive Stock under this Agreement shall be forfeited. In the event of Participant’s termination of employment by reason of Retirement, Disability or death, P