THE CORPORATE LIBRARY

Related Party Transactions and Outside Related Director Information

Rowan Companies, Inc. (RDC)

3/15/2006 Proxy Information

In previous years, certain officers of the Company issued promissory notes in favor of Rowan in connection with their purchases from Rowan of one or more series of Floating Rate Subordinated Convertible Debentures. The promissory notes bear interest at the same rate as the debentures, prime + .5%, and mature at various dates from 2008-2011. The promissory notes are secured by a pledge of the debentures purchased and contain provisions for set-off, effectively protecting the Company from any credit risk since the face amount of the debentures are equal to the amount of the notes. All such promissory notes pre-dated enactment of the Sarbanes-Oxley Act of 2002. The largest amounts of such promissory notes outstanding during 2005 and the amounts outstanding at December 31, 2005 were as follows: (see page 17 of proxy).

On May 1, 2003, Mr. Palmer retired after more than 31 years as the CompanyÕs Chief Executive Officer. The Company continues to provide Mr. Palmer with office and administrative support, estimated to cost $100,000 annually, and limited personal use of or access to certain of RowanÕs facilities and equipment, including company aircraft, which had an incremental cost to the Company in 2005, net of reimbursements, of approximately $19,000. In addition, the Company incurred approximately $532,000 of expense in 2005 related to Mr. PalmerÕs participation in one of the pension restoration plans.

In March 2006, the Board of Directors approved an agreement with Mr. Palmer that commences on the 2006 Annual Meeting date, terminates on April 27, 2011 and supersedes all prior arrangements. The 2006 agreement provides that the Company will reimburse Mr. Palmer for certain expenses relating to service on two industry organizations, continue to furnish Mr. Palmer with an administrative assistant (Mr. Palmer will reimburse the Company for 60% of the assistantÕs salary), and permit Mr. Palmer to use one of the CompanyÕs aircraft on an Òif availableÓ basis up to 20 flight hours per year. Mr. Palmer will reimburse the Company for estimated variable costs of such aircraft use.

During 2005, Rowan paid Andrews Kurth LLP, its outside counsel, approximately $923,000 in legal fees, which the Company believes reflected market rates for services rendered. Such fees were approved by the Board of Directors. Mr. P. Dexter Peacock, a Class I Director of the Company, is Of Counsel to Andrews Kurth, a designation that firm uses for former partners who have retired from the active practice of law. Mr. Peacock has no role in providing legal services to the Company, and his compensation from Andrews Kurth is not directly or indirectly affected by the fees that the Company pays to Andrews Kurth.

The Company employs certain individuals who are related to current members of the Board of Directors. Mr. John R. Palmer, the CompanyÕs Regulatory Compliance Manager, received approximately $137,000 in compensation in 2005, including wages and proceeds from the exercise of stock options. Mr. Palmer joined the Company in 1984 and is the son of C. R. Palmer, who is retiring as Class III Director as of the meeting date. Mr. Michael D. Dubose, the CompanyÕs North Sea Area Manager, received approximately $210,000 in salary and bonuses and $116,000 in proceeds from the exercise of stock options. In addition, as part of Mr. DuboseÕs expatriate package, the Company pays certain additional local expenses for Mr. Dubose and his family of approximately $80,000. Mr. Dubose joined the Company in 1978 and is the brother-in-law of D. F. McNease, the CompanyÕs Chairman, President and Chief Executive Officer.

3/17/2005 Proxy Information

In previous years, certain officers of the Company issued promissory notes in favor of Rowan in connection with their purchases from Rowan of one or more series of Floating Rate Subordinated Convertible Debentures. The promissory notes bear interest at the same rate as the debentures, prime + .5%, and mature at various dates from 2008-2011. The promissory notes are secured by a pledge of the debentures purchased and contain provisions for set-off, effectively protecting the Company from any credit risk since the face amount of the debentures are equal to the amount of the notes. All such promissory notes pre-dated enactment of the Sarbanes-Oxley Act of 2002. The largest amounts of such promissory notes outstanding during 2004 and the amounts outstanding at December 31, 2004 were as follows: (see page 20 of proxy).

On May 1, 2003, Mr. Palmer retired after more than 31 years as the CompanyÕs Chief Executive Officer. To enlist his ongoing efforts as non-executive Chairman of the Board to ensure a smooth transition in responsibilities to Mr. McNease, the Compensation Committee determined at that time to retain Mr. Palmer in a consulting capacity for one year. Mr. PalmerÕs consulting agreement provided for an annual retainer of $250,000, for which he received $83,333 in 2004. The consulting fee terminated on April 30, 2004. The Company continues to provide Mr. Palmer with office and administrative support, estimated to cost $100,000 annually, and continuing personal use of or access to certain of RowanÕs facilities and equipment, included company aircraft, which had an incremental cost to the Company in 2004, net of reimbursements, of approximately $19,000. In addition, the Company incurred approximately $607,000 of expense in 2004 related to Mr. PalmerÕs participation in one of the pension restoration plans.

During 2004, Rowan paid Andrews Kurth LLP, its outside counsel, approximately $688,000 in legal fees, which the Company believes reflected market rates for services rendered. Such fees were approved by the Board of Directors. Mr. P. Dexter Peacock, a Class I Director of the Company, is Of Counsel to Andrews Kurth.

The CompanyÕs sale, in early 2004, of 11.5 million shares of common stock for $23.05 per share was solely underwritten by Lehman Brothers Inc. The underwriting agreement provided that LehmanÕs commission depended upon the proceeds it received upon its sale of RowanÕs common stock, and such proceeds and, therefore, such commission are not known by the Company. These transactions were negotiated by the Company and approved by the Board of Directors. Mr. H. E. Lentz, a Class I Director, is an Advisory Director of Lehman.

The Company employs certain individuals who are related to current members of the Board of Directors. Mr. John R. Palmer, the CompanyÕs Regulatory Compliance Manager, received approximately $110,000 in compensation in 2004, including wages and proceeds from stock options. Mr. Palmer, who joined the Company in 1984, is the son of C. R. Palmer, a Class III Director of the Company. Mr. Michael D. Dubose, the CompanyÕs North Sea Area Manager, received approximately $243,000 in compensation in 2004, including wages and proceeds from stock options. Mr. Dubose, who joined the Company in 1978, is the brother-in-law of D. F. McNease, the CompanyÕs Chairman, President and Chief Executive Officer.

3/15/2004 Proxy Information

In previous years, certain officers of the Company issued promissory notes in favor of Rowan in connection with their purchases from Rowan of one or more series of Floating Rate Subordinated Convertible Debentures. The promissory notes bear interest at the same rate as the debentures, prime + .5%, and mature at various dates from 2004-2011. The promissory notes are secured by a pledge of the debentures purchased and contain provisions for set-off, effectively protecting the Company from any credit risk since the face amount of the debentures are equal to the amount of the notes. All such promissory notes pre-dated enactment of the Sarbanes-Oxley Act of 2002. The largest amounts of such promissory notes outstanding during 2003 were as follows: (see proxy for promissory note table).

Effective May 1, 2003, Mr. Palmer retired after more than 31 years as the Company's Chief Executive Officer. To enlist his ongoing efforts as non-executive Chairman of the Board to ensure a smooth transition in responsibilities to Mr. McNease, the Compensation Committee determined at that time to retain Mr. Palmer in a consulting capacity. Mr. Palmer's consulting agreement provides for an annual retainer of $250,000, for which he received $166,667 in 2003, and personal use of or access to Rowan's facilities, equipment and staff at his expense.

During 2003, Rowan paid Citibank, N. A., its primary lender, approximately $970,000 in interest and fees. The financial terms of such borrowings reflected market conditions prevailing at the time of their origination and were reviewed and approved by the Company's Board of Directors. Mr. William T. Fox III, a Class I Director, was a Managing Director of the parent company of Citibank until his retirement in August 2003.

During 2003, Rowan paid Andrews Kurth LLP, its general counsel, approximately $170,000 in legal fees, which the Company believes reflected market rates for services rendered. Such fees were approved by the Board of Directors. Mr. P. Dexter Peacock, a nominee for Class I Director, is Of Counsel to Andrews Kurth.

The Company's sale, in early 2004, of 11.5 million shares of common stock for $23.05 per share was solely underwritten by Lehman Brothers Inc. The underwriting agreement provided that Lehman's commission depended upon the proceeds it received upon its sale of Rowan's common stock, and such proceeds and, therefore, such commission are not known by the Company. These transactions were negotiated by the Company and approved by the Board of Directors. Mr. H. E. Lentz, a Class I Director, is currently an Advisory Director of Lehman, and served as a Consultant to Lehman from January to December 2003 and as a Managing Director of Lehman from 1993 to January 2003.

3/21/2003 Proxy Information

In previous years, Mr. Palmer and certain other officers of the Company issued promissory notes in favor of Rowan in connection with their purchases from Rowan of one or more series of Floating Rate Subordinated Convertible Debentures. The promissory notes bear interest at the same rate as the debentures, prime + .5%, and mature at various dates from 2004 - 2011. The promissory notes are secured by a pledge of the debentures purchased and contain provisions for set-off, effectively protecting the Company from any credit risk since the face amount of the debentures are equal to the amount of the notes. The largest amounts of such promissory notes outstanding during 2002 were as follows: (see proxy for promissory note table).

No such promissory notes were issued in favor of the Company after enactment of the Sarbanes-Oxley Act.

During 2002, Rowan paid Citibank, N. A., its primary lender, approximately $697,000 in interest and fees. The financial terms of such borrowings reflected market conditions prevailing at the time of their origination and were reviewed and approved by the Company's Board of Directors. Mr. William T. Fox III, a Class I Director, is a Managing Director of Citibank, N. A.