TENTH AMENDED AND RESTATED
                                ASHLAND INC.
                     SUPPLEMENTAL EARLY RETIREMENT PLAN
                           FOR CERTAIN EMPLOYEES
                              November 4, 1999

ARTICLE I.        PURPOSE AND EFFECTIVE DATE.
1.01     PURPOSE
         The purpose of the Plan is to allow designated employees to retire
         prior  to  their   sixty-fifth   birthday   without  an  immediate
         substantial loss of income. This Plan is a supplemental retirement
         arrangement for a select group of management.
1.02     EFFECTIVE DATE
         The Tenth  Amended and Restated  Ashland Inc.  Supplemental  Early
         Retirement Plan for Certain  Employees is hereby amended effective
         November 4, 1999. However, the rights and obligations of Employees
         who were  selected  by the  Board or  approved  for  participation
         pursuant to the eligibility  requirements of the Plan to receive a
         benefit under the Plan, or who were  receiving  benefits  prior to
         November  4, 1999  shall be  governed  by the terms of the Plan in
         effect at the time of each such  Employee's  Effective  Retirement
         Date,  unless  otherwise  determined  by the Committee in its sole
         discretion.
ARTICLE II.       DEFINITIONS.
         The following terms used herein shall have the following  meanings
         unless the context otherwise requires:
2.01      "Age" - means the  age  of  an  Employee  as of  his or her  last
          birthday,  except  as may  otherwise  be provided  under Sections
          5.01 and 5.02 in the event of a Change in Control.
2.02     "Annual Retirement Income" - means the annual income payable under
         this Plan by Ashland for the lifetime of a Participant  commencing
         on such Participant's  Effective Retirement Date and ending on his
         or her date of death, subject to the provisions of Section 5.04.
2.03     "Ashland"  -  means   Ashland  Inc.  and  its  present  or  future
         subsidiary corporations.
2.04     "Board"  -  means  the  Board  of  Directors  of  Ashland  and its
         designees.
2.05     "Change  in  Control"  - shall be  deemed  to  occur  (1) upon the
         approval of the  shareholders  of Ashland (or if such  approval is
         not required,  the approval of the Board) of (A) any consolidation
         or merger of Ashland in which  Ashland  is not the  continuing  or
         surviving  corporation  or  pursuant  to which  shares of  Ashland
         common stock would be  converted  into cash,  securities  or other
         property  other  than a merger in which  the  holders  of  Ashland
         common  stock  immediately  prior to the merger will have the same
         proportionate   ownership  of  common   stock  of  the   surviving
         corporation  immediately  after the merger,  (B) any sale,  lease,
         exchange,  or other  transfer (in one  transaction  or a series of
         related  transactions) of all or  substantially  all the assets of
         Ashland,  or  (C)  adoption  of  any  plan  or  proposal  for  the
         liquidation or  dissolution of Ashland,  (2) when any "person" (as
         defined in Section 3(a)(9) or 13(d) of the Securities Exchange Act
         of 1934), other than Ashland or any subsidiary or employee benefit
         plan or trust  maintained  by Ashland or any of its  subsidiaries,
         shall  become the  "beneficial  owner"  (as  defined in Rule 13d-3
         under  the   Securities   Exchange  Act  of  1934),   directly  or
         indirectly,   of  more  than  15%  of  the  Ashland  common  stock
         outstanding at the time, without the approval of the Board, or (3)
         if  at  any  time  during  a  period  of  two  consecutive  years,
         individuals  who at the beginning of such period  constituted  the
         Board shall cease for any reason to constitute at least a majority
         thereof,  unless  the  election  or  nomination  for  election  by
         Ashland's  shareholders  of each new director during such two-year
         period  was  approved  by a vote  of at  least  two-thirds  of the
         directors then still in office who were directors at the beginning
         of such two-year period.
2.06     "Committee" - means the Personnel  and  Compensation  Committee of
         the Board and its designees.
2.07     "Effective  Retirement  Date"  -  means  the  date  upon  which  a
         Participant  retires  under this Plan which shall be the first day
         of the month  following  the  Participant's  62nd  birthday or, at
         Ashland's  discretion or as otherwise provided in Article V or VI,
         any earlier age.  Upon  approval as provided in Sections  3.01 and
         3.02, the "Effective  Retirement  Date" of a Participant may occur
         after the Employee  reaches age 62. The Effective  Retirement Date
         of an  Employee  who  becomes a  Participant  under  Section  3.03
         because of a Change in Control and who is considered to be a Level
         I or II participant in the Incentive Compensation Plan and who has
         an  Employment  Agreement  shall  be the  first  day of the  month
         following (i) such  Employee's  termination for reasons other than
         "Cause" or (ii) such Employee's resignation for "Good Reason." The
         Effective Retirement Date of an Employee who becomes a Participant
         under  Section  3.03  because  of a Change in  Control  and who is
         considered to be a Level III, IV or V participant in the Incentive
         Compensation  Plan,  or who is  considered  to be a  Level I or II
         participant  in the Incentive  Compensation  Plan and who does not
         have an Employment Agreement,  shall be the first day of the month
         following  such  Employee's  termination  for  reasons  other than
         "Cause".  For Employees  who do not have an  Employment  Agreement
         with Ashland, "Cause" shall have the meaning given to that word in
         Section 3.05.
2.08     "Employee"  - means an  employee of Ashland who (i) is at least 55
         years of age or such earlier age pursuant to Section 5.06(b);  and
         (ii) is deemed on the Effective Retirement Date to be a Level V or
         above   employee   under   the   Incentive    Compensation   Plan.
         Notwithstanding  anything  herein  to the  contrary,  if,  after a
         Change in  Control,  an  Employee  is  terminated  other  than for
         "Cause"  or,  in the case of a Level I or II  Employee  having  an
         Employment  Agreement,  resigns  for  "Good  Reason,"  the  age 55
         threshold in clause (i) does not apply and is inapplicable.
2.09     "Employment Agreements" - means those contractual  agreements,  in
         effect  from  time to time,  which are  approved  by the Board and
         which  provide an Employee  with a specified  period of employment
         and other benefits.
2.10     "Final Average Bonus" - means the Participant's average bonus paid
         under the Incentive  Compensation Plan (including amounts that may
         have been deferred) during the highest  thirty-six (36) months out
         of the final  sixty-month  (60) period.  For these  purposes,  the
         "bonus  paid" for a particular  month  within a particular  fiscal
         year  under  such plan  shall be equal to the amount of such bonus
         actually  paid  (regardless  of the date paid,  but  excluding any
         adjustment  for the deferral of such payment) to such  Participant
         on account  of such  fiscal  year  divided by the number of months
         contained in such fiscal year which were used in  determining  the
         amount of such bonus actually paid to such Participant.
2.11     "Final   Average   Compensation"   -  means  the   average   total
         compensation paid during the highest thirty-six months (36) out of
         the final  sixty-month  (60) period.  For these  purposes,  "total
         compensation  paid" is the sum of the "compensation  paid" and the
         "bonus paid" during a particular month.  "Compensation paid" shall
         be the base rate of compensation for such Participant in effect on
         the first day of such calendar month.  "Bonus paid" shall have the
         same meaning as set forth in Section  2.10. In the event a payment
         is due  under  the Plan  after a Change  in  Control  because  the
         Participant was terminated  other than for "Cause" or resigned for
         "Good Reason," the calculation of Final Average Compensation shall
         include  the  amount  paid  under  such  Participant's  Employment
         Agreement. The amount so paid shall be divided by 36 to derive the
         monthly "total compensation paid" it represents.
2.12     "Incentive  Compensation  Plan" - means the Ashland Inc. Incentive
         Compensation Plan or the Ashland Inc. Incentive  Compensation Plan
         for Key Executives, as applicable, including any successor to such
         plans.
2.13     "Participant"  - means  an  Employee  who has  been  approved  for
         participation in the Plan pursuant to Article III or Section 5.06.
2.14     "Plan"  - means  the  Tenth  Amended  and  Restated  Ashland  Inc.
         Supplemental  Early  Retirement Plan for Certain  Employees as set
         forth herein.
2.15     "Service"  - means the  number of years  and  fractional  years of
         employment by Ashland of an Employee,  measured from the first day
         of the month coincident with or next succeeding his or her initial
         date of employment up to and including such  Employee's  Effective
         Retirement Date. For purposes of this Section 2.15,  Service shall
         include an Employee's employment with a subsidiary or an affiliate
         of Ashland  determined in accordance  with rules from time to time
         adopted or approved by the Board, or its delegate.
ARTICLE III.      PARTICIPATION IN PLAN.
         Eligibility for benefits shall be determined as follows:
3.01     EMPLOYEES WHO REQUIRE BOARD APPROVAL
         Except as otherwise  provided in Section  3.03, an Employee who on
         the  Effective  Retirement  Date is  deemed  to be a Level I or II
         participant  under the Incentive  Compensation  Plan shall require
         Board approval to participate in this Plan.
3.02     EMPLOYEES WHO REQUIRE CEO OR OTHER APPROVAL
         Except as otherwise  provided in Section  3.03, an Employee who on
         the Effective  Retirement Date is deemed to be a Level III, IV, or
         V participant under the Incentive  Compensation Plan shall require
         the approval of either (i) Ashland's  Chief  Executive  Officer or
         (ii) Ashland's Administrative Vice President,  Human Resources and
         either the President or the Chief Financial Officer to participate
         in this Plan.
3.03     AUTOMATIC APPROVAL FOR CHANGE IN CONTROL
         Subject to the  provisions of Article VI, in the event of a Change
         in Control (as defined in Section 2.05), an Employee who is deemed
         to be a Level I, II, III, IV or V participant  under the Incentive
         Compensation Plan shall  automatically be deemed to be approved by
         the Board or by the Chief Executive  Officer,  as applicable,  for
         participation under this Plan.
3.04     OTHER APPROVALS
         The Board or Chief Executive Officer,  as applicable,  may approve
         such  employees for  participation  in the Plan as they deem to be
         appropriate, all in its or his sole discretion.
3.05     TERMINATION FOR CAUSE
         Ashland  reserves  the  right to  terminate  any  Participant  for
         "Cause"  prior to his or her  Effective  Retirement  Date,  with a
         resulting  forfeiture  of the payment of benefits  under the Plan.
         Ashland also  reserves the right to  terminate  any  Participant's
         participation  in the Plan for  "Cause"  subsequent  to his or her
         Effective  Retirement  Date.  For purposes of this  Section  3.05,
         "Cause"  shall  mean  the  willful  and  continuous  failure  of a
         Participant to substantially  perform his or her duties to Ashland
         (other than any such  failure  resulting  from  incapacity  due to
         physical  or  mental  illness),  or  the  willful  engaging  by  a
         Participant  in  gross  misconduct   materially  and  demonstrably
         injurious to Ashland, each to be determined by Ashland in its sole
         discretion.
ARTICLE IV.       INTERACTION WITH EMPLOYMENT AGREEMENTS.
4.01     TERMINATIONS - GENERAL
         Notwithstanding  any  provision of this Plan to the  contrary,  an
         Employee who has entered into an Employment Agreement with Ashland
         and who is either terminated without "Cause" prior to a "change in
         control of Ashland" or is  terminated  without  "Cause" or resigns
         for "Good Reason" following a "change in control of Ashland" (each
         quoted  term as defined in the  applicable  employment  agreement)
         shall be entitled to receive the benefits as provided  pursuant to
         this Plan. Benefits payable hereunder in such a situation shall be
         calculated in accordance  with the payment option  selected by the
         Employee at such time.
4.02     BENEFITS PRIOR TO "CHANGE IN CONTROL."
         If the  Employee's  termination  is  without  "Cause"  prior  to a
         "change in control of  Ashland,"  the benefits  payable  hereunder
         shall commence no earlier than as of the first day of the calendar
         month  coincident  with or next  following the second  anniversary
         following the Employee's  "Date of Termination" (as defined in the
         applicable employment agreement);  however, if the Employee elects
         to receive  such  benefits  in a lump sum as  provided  in Section
         5.04(b)(1), such benefits shall commence and be payable as therein
         specified.
4.03     BENEFITS SUBSEQUENT TO A "CHANGE IN CONTROL."
         If the  Employee's  termination  is  without  "Cause" or he or she
         resigns  for "Good  Reason"  following  a "change  in  control  of
         Ashland,"  benefits payable  hereunder shall begin as of the first
         day  of  the  calendar  month  next  following  the  Participant's
         Effective Retirement Date.
4.04     SUBSEQUENT ACTIVITY IN CONFLICT WITH ASHLAND
         The  provisions  of this  Section 4.04 shall apply to Level I, II,
         III,  IV  and  V  Participants,   regardless  of  whether  such  a
         Participant   has  an  Employment   Agreement;   except  that  the
         provisions of this Section 4.04 shall not apply to any Participant
         who was approved for participation  hereunder under the provisions
         of Section 3.03. If a Participant accepts, during a period of five
         (5) years subsequent to his or her Effective  Retirement Date, any
         consulting  or  employment   activity   which  is  in  direct  and
         substantial  conflict  with the  business  of Ashland at such time
         (such determination  regarding  conflicting activity to be made in
         the sole  discretion of the Board),  he or she shall be considered
         in  breach  of the  provisions  of this  Section  4.04;  provided,
         however,  he or she shall not be  restricted  in any  manner  with
         respect to any other  non-conflicting  activity in which he or she
         is  engaged.

         If  a  Participant  wishes  to  accept  employment  or  consulting
         activity  which may be prohibited  under this Section  4.04,  such
         Participant  may  submit to  Ashland  written  notice  (Attention:
         Administrative Vice President, Human Resources) of his or her wish
         to accept such  employment or consulting  activity.  If within ten
         (10) business days  following  receipt of such notice Ashland does
         not notify the  Participant  in writing of Ashland's  objection to
         his or her accepting such employment or consulting activity,  then
         such  Participant  shall  be free to  accept  such  employment  or
         consulting  activity for the period of time and upon the basis set
         forth in his or her written  request.  In the event the provisions
         of  this  Section  4.04  are  breached  by  a   Participant,   the
         Participant  shall  not be  entitled  to any  additional  periodic
         payments  hereunder  and shall be liable to repay to  Ashland  all
         amounts  such  Participant  received  prior to such  breach.  If a
         Participant  who  breaches  the  provisions  of this  Section 4.04
         received a lump sum  distribution  of his or her benefit  prior to
         such breach,  such Participant shall be liable to repay to Ashland
         the amount of such distribution. If a Participant who breaches the
         provisions of this Section 4.04 deferred all or any part of a lump
         sum   distribution   hereunder  to  the  Ashland   Inc.   Deferred
         Compensation Plan, the amount so deferred shall be forfeited,  and
         if any amount of the amount so deferred was  distributed  from the
         Ashland  Inc.   Deferred   Compensation  Plan  before  the  breach
         occurred,  the amount so  distributed  shall be repaid to Ashland.
         Any repayment of benefits  hereunder shall be assessed interest at
         the rate  applicable  for the  calculation  of a lump sum  payment
         under  Section  5.04(b) for the month in which the breach  occurs,
         with such interest  compounded monthly from the month in which the
         breach  occurs to the  month in which  such  repayment  is made to
         Ashland.  Ashland shall have available to it all other remedies at
         law and equity to remedy a breach of this Section 4.04.
ARTICLE V.        ANNUAL RETIREMENT INCOME AND OTHER BENEFITS.
5.01     LEVELS I AND II.
         The Annual  Retirement Income of a Participant who is deemed to be
         a Level I or II Participant under the Incentive  Compensation Plan
         shall be equal to:
         (a)      PRE-AGE 62 BENEFIT
                  A Participant  who retires  under this Plan,  including a
                  Participant  to whom the  provisions  of paragraph (d) of
                  this  Section  5.01  apply,   shall   receive  an  Annual
                  Retirement  Income  from and  after  the first day of the
                  calendar  month  next  following  his  or  her  Effective
                  Retirement Date until the end of the month in which he or
                  she  attains  age 62  equal  to the  greater  of (1)  the
                  amounts provided in the following  schedule or (2) 50% of
                  Final Average Compensation.  Notwithstanding the previous
                  sentence, in the event such Participant retired with less
                  than 20 years of Service,  such Annual  Retirement Income
                  shall be  multiplied  by a fraction (A) the  numerator of
                  which is such Participant's years of and fractional years
                  of Service,  and (B) the  denominator  of which is twenty
                  (20).

                                                                     % OF
                  RETIREMENT                                     COMPENSATION

                  1st    -   Year After Effective                    75%
                             Retirement Date
                  2nd    -          "                                70%
                  3rd    -          "                                65%
                  4th    -          "                                60%
                  5th    -          "                                55%
                  6th    -   Year and thereafter                     50%
                             to Age 62

                  For purposes of this Section 5.01(a), "% of Compensation"
                  shall mean the  annualized  average of the  Participant's
                  base  monthly  compensation  rates  (excluding  incentive
                  awards,  bonuses,  and any  other  form of  extraordinary
                  compensation)  in effect  with  respect to Ashland on the
                  first day of the  thirty-six  (36)  consecutive  calendar
                  months  which will give the  highest  average  out of the
                  one-hundred  twenty  (120)  consecutive   calendar  month
                  period ending on the Participant's  Effective  Retirement
                  Date.
         (b)      AGE 62 BENEFIT AND THEREAFTER
                  From and after the first day of the  calendar  month next
                  following  his or her Effective  Retirement  Date, or the
                  attainment   of  age  62,   whichever   is   later,   the
                  Participant's  Annual Retirement Income shall be equal to
                  50% of Final  Average  Compensation;  provided,  however,
                  that in the event such Participant retired with less than
                  20 years of Service,  such Annual Retirement Income shall
                  be 50% of  Final  Average  Compensation  multiplied  by a
                  fraction (A) the numerator of which is such Participant's
                  years of and  fractional  years of  Service,  and (B) the
                  denominator of which is twenty (20).
         (c)      BENEFIT REDUCTION
                  The amount of benefit  provided in paragraphs (a) and (b)
                  of this  Section  5.01 shall be reduced by the sum of the
                  following:
                  (1)    the  Participant's  benefit under the Ashland Inc.
                         and Affiliates  Pension Plan (the "Pension  Plan")
                         (assuming 50% of such Participant's  account under
                         the  Ashland   Inc.   Leveraged   Employee   Stock
                         Ownership  Plan were  transferred  to the  Pension
                         Plan,  as  allowed  under the terms of each of the
                         said plans),  determined  on the basis of a single
                         life annuity form of benefit;
                  (2)    the Participant's  benefit under any other defined
                         benefit   pension  plan  qualified  under  Section
                         401(a) of the Internal  Revenue  Code of 1986,  as
                         amended which is maintained by Ashland, determined
                         on the  basis of a  single  life  annuity  form of
                         benefit (said plans referred to in  sub-paragraphs
                         (1) and (2) of this paragraph (c) are  hereinafter
                         referred to jointly and severally as the "Affected
                         Plans");
                  (3)    the  Participant's  benefit under the Ashland Inc.
                         Nonqualified    Excess   Benefit   Pension   Plan,
                         determined  on the basis of a single life  annuity
                         form of benefit; and
                  (4)    the  Participant's  benefit under the Ashland Inc.
                         ERISA  Forfeiture  Plan  attributable  to  amounts
                         which  were  forfeited   under  the  Ashland  Inc.
                         Leveraged    Employee   Stock    Ownership   Plan,
                         multiplied by 50%, and  determined on the basis of
                         a single life annuity benefit.
                  In the event a Participant's benefit hereunder is paid as
                  a  lump  sum  pursuant  to  an  election   under  Section
                  5.04(b)(1),  the  reduction  to  such  benefit  shall  be
                  calculated  based  upon the lump  sum  actuarial  present
                  value  of  the  benefits  referred  to in  sub-paragraphs
                  (1)-(4) of this  paragraph  (c) to which the  Participant
                  would  be  entitled  at age 62,  regardless  of the  date
                  payments   actually   commence.    In   the   event   the
                  Participant's  benefit  hereunder  is paid in any form of
                  periodic  payments,  the  reduction  shall apply from and
                  after  the  date  the  Participant   actually   commences
                  payments under the plans referred to under sub-paragraphs
                  (1), (2) or (3) of this paragraph (c).
         (d)      BENEFIT AFTER A CHANGE IN CONTROL
                  (1)        PARTICIPANTS HAVING EMPLOYMENT  AGREEMENTS.  A
                             Participant having an Employment Agreement who
                             either  is  terminated   without   "Cause"  or
                             resigns  for "Good  Reason"  after a Change in
                             Control  shall have the benefit  payable under
                             this Section  5.01  computed by adding 3 years
                             to the  Participant's  Age and  Service at the
                             Participant's Effective Retirement Date. These
                             additions to Age and Service shall,  except as
                             otherwise  provided,  apply  for  purposes  of
                             computing  the single life annuity  payment to
                             the Participant. A Participant subject to this
                             paragraph  (d)(1) whose  Effective  Retirement
                             Date occurs before  attaining an actual age of
                             55 shall have the 3 year addition to Age apply
                             when converting the single life annuity amount
                             to any  permitted  optional  form  under  this
                             Article V. If the Effective Retirement Date of
                             a Participant subject to this paragraph (d)(1)
                             occurs on or after the Participant  attains an
                             actual  age  of  55,  then  the  Participant's
                             actual  age shall be used when  making  such a
                             conversion.  Notwithstanding  anything  to the
                             contrary  contained herein,  when converting a
                             Participant's  single  life  annuity to a lump
                             sum payment option,  the Participant's  actual
                             age  shall be used  without  reference  to the
                             additional 3 years. If the addition of 3 years
                             to the  Participant's  age  results  in an Age
                             less than 55 and the Participant commences the
                             benefit,  the amount of the  benefit  shall be
                             adjusted  to  account  for the fact it is paid
                             before the Participant's attainment of Age 55.
                             This adjustment  shall be based upon the early
                             retirement table in Section 6.2 of the Ashland
                             Inc. and Affiliates Pension Plan as it existed
                             on September  30,  1999.  When  applying  this
                             table under these circumstances,  age 55 shall
                             be substituted  for age 62 and adjustments for
                             ages  younger than those on the table shall be
                             reasonably   determined   by  an   actuary  or
                             actuarial firm who regularly performs services
                             in connection with the Plan.
                  (2)        PARTICIPANTS WITHOUT EMPLOYMENT AGREEMENTS.  A
                             Participant  without an  Employment  Agreement
                             who is  terminated  without  "Cause"  after  a
                             Change  in  Control  shall  have  the  benefit
                             payable  under this Section  5.01  computed by
                             adding   the   applicable    amount   to   the
                             Participant's   Age   and   Service   at   the
                             Participant's  Effective  Retirement Date. For
                             these  purposes,   the  applicable  amount  is
                             derived from the following table.

    LENGTH OF PARTICIPANT'S SERVICE AT SEPARATION FROM       NUMBER OF YEARS
                        EMPLOYMENT                       (THE APPLICABLE AMOUNT)
-------------------------------------------------------------------------------
Up to 5 years                                               3 months
More than 5 and up to 10 years                              6 months
More than 10 and up to 15 years                             1 year
More than 15 and up to 20 years                             1 year and 6 months
More than 20 years                                          2 years

                             These  additions  to Age  and  Service  shall,
                             except  as  otherwise   provided,   apply  for
                             purposes of computing  the single life annuity
                             payment  to  the  Participant.  A  Participant
                             subject  to  this   paragraph   (d)(2)   whose
                             Effective   Retirement   Date  occurs   before
                             attaining  an actual  age of 55 shall have the
                             applicable amount added to such  Participant's
                             Age apply  when  converting  the  single  life
                             annuity amount to any permitted  optional form
                             under  this   Article  V.  If  the   Effective
                             Retirement  Date of a  Participant  subject to
                             this  paragraph  (d)(2) occurs on or after the
                             Participant  attains an actual age of 55, then
                             the  Participant's  actual  age  shall be used
                             when making such a conversion. Notwithstanding
                             anything  to the  contrary  contained  herein,
                             when  converting a  Participant's  single life
                             annuity  to a lump  sum  payment  option,  the
                             Participant's actual age shall be used without
                             reference  to the  addition of the  applicable
                             amount.  If the  addition  of  the  applicable
                             amount to the  Participant's age results in an
                             Age less than 55 and the Participant commences
                             the benefit,  the amount of the benefit  shall
                             be adjusted to account for the fact it is paid
                             before the Participant's attainment of Age 55.
                             This adjustment  shall be based upon the early
                             retirement table in Section 6.2 of the Ashland
                             Inc. and Affiliates Pension Plan as it existed
                             on September  30,  1999.  When  applying  this
                             table under these circumstances,  age 55 shall
                             be substituted  for age 62 and adjustments for
                             ages  younger than those on the table shall be
                             reasonably   determined   by  an   actuary  or
                             actuarial firm who regularly performs services
                             in connection with the Plan.

5.02     LEVELS III, IV AND V.
         (a)      GENERAL
                  The Annual Retirement Income of a Participant  (including
                  a Participant  to whom the provisions of paragraph (b) of
                  this  Section  5.02  apply)  who on his or her  Effective
                  Retirement  Date was deemed to be a Level  III,  IV, or V
                  Participant under the Incentive  Compensation Plan shall,
                  from and after the first day of the  calendar  month next
                  following  his or her 62nd  birthday,  be equal to 50% of
                  Participant's  Final Average  Bonus;  provided,  however,
                  that in the event such Participant retired with less than
                  20 years of Service,  such Annual Retirement Income after
                  age 62 shall be 50% of Final Average Bonus  multiplied by
                  a   fraction   (A)  the   numerator   of  which  is  such
                  Participant's  years of and fractional  years of Service,
                  and (B) the denominator of which is twenty (20). Although
                  a Participant  may elect to commence  benefits under this
                  Plan upon his or her  Effective  Retirement  Date,  there
                  shall be an actuarial  adjustment  (consistent  with that
                  applied under Ashland's  qualified  pension plan, as from
                  time  to  time  in  effect)  for  Participants  receiving
                  benefits   under  this  Section   5.02  whose   Effective
                  Retirement Date is prior to age 62.
         (b)      BENEFIT AFTER A CHANGE IN CONTROL
                  A Participant  who is  terminated  other than for "Cause"
                  after a Change in Control shall have the benefit  payable
                  under  this  Section  5.02  computed  by  adding  to  the
                  Participant's   Age  and  Service  at  the  Participant's
                  Effective  Retirement  Date the number of years  equal to
                  the applicable  amount for the  Participant  derived from
                  the following table.

    LENGTH OF PARTICIPANT'S SERVICE AT SEPARATION FROM      NUMBER OF YEARS
                        EMPLOYMENT                       (THE APPLICABLE AMOUNT)
-------------------------------------------------------------------------------
Up to 5 years                                               3 months
More than 5 and up to 10 years                              6 months
More than 10 and up to 15 years                             1 year
More than 15 and up to 20 years                             1 year and 6 months
More than 20 years                                          2 years

                  These  additions  to Age and  Service  shall,  except  as
                  otherwise  provided,  apply for purposes of computing the
                  single  life  annuity  payment  to  the  Participant.   A
                  Participant subject to this paragraph (b) whose Effective
                  Retirement Date occurs before  attaining an actual age of
                  62  shall  have the  applicable  amount  from  the  table
                  hereinabove added to his or her Age apply when converting
                  the single life annuity amount to any permitted  optional
                  form under this  Article V. If the  Effective  Retirement
                  Date  of a  Participant  subject  to this  paragraph  (b)
                  occurs on or after the Participant  attains an actual age
                  of 62,  then the  Participant's  actual age shall be used
                  when making such a conversion.  Notwithstanding  anything
                  to the  contrary  contained  herein,  when  converting  a
                  Participant's  single life  annuity to a lump sum payment
                  option,  the  Participant's  actual  age  shall  be  used
                  without  reference to the applicable  amount derived from
                  the table hereinabove.  If the addition of the applicable
                  amount from the table  hereinabove  to the  Participant's
                  age  results  in an Age less than 62 and the  Participant
                  commences the benefit, the amount of the benefit shall be
                  adjusted  to account  for the fact it is paid  before the
                  Participant's attainment of Age 62. This adjustment shall
                  be based upon the early  retirement  table in Section 6.2
                  of the Ashland  Inc.  and  Affiliates  Pension Plan as it
                  existed on September 30, 1999, and  adjustments  for ages
                  younger  than  those on the  table  shall  be  reasonably
                  determined by an actuary or actuarial  firm who regularly
                  performs services in connection with the Plan.

5.03     BENEFITS PAYABLE FOR LESS THAN 12 MONTHS
         Annual  Retirement Income benefits payable under Sections 5.01 and
         5.02 for a period of less than 12  months  due to a  Participant's
         attainment of age 62 or death will be payable on a pro-rata basis,
         with months taken as a fraction of a year.
5.04     PAYMENT OPTIONS
         (a)      ELECTION
                  A Participant  shall,  subject to Sections 5.05 and 5.06,
                  elect the form in which such  benefit  shall be paid from
                  among  those  identified  in this  Section  5.04 and such
                  election  shall  be made at the  time  and in the  manner
                  prescribed by Ashland,  from time to time,  provided that
                  the election is made before the  Participant's  Effective
                  Retirement Date. Such election, including the designation
                  of any contingent  annuitant or alternate recipient under
                  Sections  5.04(b)(4) or (5), shall be irrevocable  except
                  as otherwise set forth herein.  Notwithstanding  anything
                  in  the  foregoing  to  the  contrary,   any  Participant
                  approved  for  participation  in  the  Plan  pursuant  to
                  Sections 3.01,  3.02 and 3.04 who makes an election under
                  Section  5.04(b)(2) shall make such election by the later
                  of -
                  (1)      the  60th  day  following   such   Participant's
                           approval to participate in this Plan; or
                  (2)      the earlier of -
                           (A)      the   date   six   months    prior   to
                                    Participant's    Effective   Retirement
                                    Date; or
                           (B)      the December 31  immediately  preceding
                                    the Participant's  Effective Retirement
                                    Date.
                           Such  deferral  election  shall  be  made in the
                           manner prescribed by Ashland, from time to time,
                           and shall be  irrevocable  as of the  applicable
                           time  identified  under  Sections  5.04(a)(1) or
                           (2).
                  Until the time at which an election becomes  irrevocable,
                  a Participant shall be able to change it.
         (b)      OPTIONAL FORMS OF PAYMENT
                  (1)      LUMP  SUM  OPTION  A  Participant  may  elect to
                           receive  the benefit  under  Article V as a lump
                           sum  distribution..  A lump sum benefit  payable
                           under  the  Plan  to  a  Participant   shall  be
                           computed   on  the  basis  of  the   actuarially
                           equivalent  present value of such  Participant's
                           benefit   under   Article  V  based   upon  such
                           actuarial   assumptions  as  determined  by  the
                           Committee. Such lump sum shall be payable within
                           thirty  (30)  days  following  the  later of the
                           Participant's  Effective  Retirement Date, or at
                           such later date as Ashland or its  delegate  may
                           determine,  in its sole  discretion.  The option
                           shall  be  made   available  to  a   Participant
                           contingent    upon    various    considerations,
                           including,  but not limited  to, the  following:
                           The tax  status of  Ashland,  including  without
                           limitation,  the  corporate and  individual  tax
                           rate then  applicable and whether or not Ashland
                           has  or  projects  a  net  operating  loss;  the
                           current  and  projected  liquidity  of  Ashland,
                           including cash flow,  capital  expenditures  and
                           dividends; Ashland `s borrowing requirements and
                           debt   leverage;    applicable   book   charges;
                           organizational   issues,   including  succession
                           issues;  security of the  retirement  payment(s)
                           with   respect   to   the   retiree;   and   the
                           Participant's preference.
                  (2)      LUMP SUM DEFERRAL  OPTION A  Participant  who is
                           eligible  to  receive  a lump  sum  distribution
                           under 5.04(b)(1) shall be able to elect to defer
                           all or a portion of the  receipt of the  elected
                           lump sum (in  increments  of such  percentage or
                           such amount as may be  prescribed  by Ashland or
                           its delegatee, from time to time), by having the
                           obligation to distribute such amount transferred
                           to the Ashland Inc.  Deferred  Compensation Plan
                           to be held thereunder in a notional  account and
                           paid  pursuant to the  applicable  provisions of
                           such Plan,  as they may be amended  from time to
                           time;  provided,  however,  that the election to
                           defer  such  distribution  shall  be made at the
                           time and in the  manner  prescribed  in  Section
                           5.04(a)(1) and (2).
                  (3)      SINGLE LIFE ANNUITY A  Participant  may elect to
                           have  such  benefit  paid in the  form of  equal
                           monthly    payments    for   and   during   such
                           Participant's life, with such payments ending at
                           such  Participant's  death.  Payments under this
                           option shall be  actuarially  equivalent  to the
                           benefit  provided  under  Section  5.01 or 5.02,
                           whichever is applicable, determined on the basis
                           of  the  applicable  actuarial  assumptions  and
                           other relevant  provisions  used for the same in
                           the Pension Plan.
                  (4)      JOINT AND SURVIVOR  INCOME  OPTION A Participant
                           may  elect to  receive  an  actuarially  reduced
                           benefit payable monthly during the Participant's
                           lifetime with payments to continue  after his or
                           her   death   to  the   person   he   designates
                           (hereinafter called "contingent annuitant"),  in
                           an amount equal to (1) 100% of such  actuarially
                           reduced benefit, (2) 66 2/3% of such actuarially
                           reduced benefit,  or (3) 50% of such actuarially
                           reduced  benefit.  Benefit  payments  under this
                           option shall  terminate with the monthly payment
                           for the  month  in  which  occurred  the date of
                           death of the later to die of the Participant and
                           his or her contingent  annuitant.  The following
                           additional  limitations and conditions  apply to
                           this option:
                           (A)      The  contingent   annuitant   shall  be
                                    designated   by  the   Participant   in
                                    writing  in such  form and at such time
                                    as  Ashland   may  from  time  to  time
                                    prescribe.   Before  the  Participant's
                                    Effective    Retirement    Date,    the
                                    Participant  may change the  contingent
                                    annuitant elected.
                           (B)      In  the  event  of  the  death  of  the
                                    contingent  annuitant prior to the date
                                    as   of   which   the    election    is
                                    irrevocable,      the     Participant's
                                    selection  of this option shall be void
                                    and  the  Participant  may  change  the
                                    contingent   annuitant  or  change  the
                                    option   elected,    subject   to   the
                                    applicable  limitations  and conditions
                                    applied to  elections  for the  options
                                    described under 5.04(a)(1) and (2).
                           (C)      Actuarial    equivalence   under   this
                                    sub-paragraph  (4) shall be  determined
                                    on  the   basis   of   the   applicable
                                    actuarial    assumptions    and   other
                                    relevant  provisions  used for the same
                                    in the Pension Plan.
                  (5)      PERIOD CERTAIN  INCOME OPTION A Participant  may
                           elect to receive an actuarially  reduced benefit
                           payable  monthly  during his or her lifetime and
                           terminating  with the  monthly  payment  for the
                           month in which his or her death occurs, with the
                           provision  that  not  less  than a total  of 120
                           monthly  payments  shall be made in any event to
                           him or her and/or the person  designated  by him
                           or   her  to   receive   payments   under   this
                           sub-paragraph  (5)  in the  event  of his or her
                           death     (hereinafter     called     "alternate
                           recipient").  If a  Participant  and  his or her
                           alternate  recipient  die  after  the  Effective
                           Retirement  Date, but before the total specified
                           monthly   payments   have   been  made  to  such
                           Participant   and/or   his  or   her   alternate
                           recipient,  the commuted  value of the remaining
                           unpaid  payments  shall be paid in a lump sum to
                           the   estate   of  the   later  to  die  of  the
                           Participant  or his or her alternate  recipient.
                           The   following   additional   limitations   and
                           conditions  shall apply to this option:
                           (A)      The   alternate   recipient   shall  be
                                    designated    in    writing    by   the
                                    Participant  in such  form  and at such
                                    time as  Ashland  may from time to time
                                    prescribe.   The   designation   of  an
                                    alternate    recipient    under    this
                                    sub-paragraph  (5) is irrevocable after
                                    the    Effective    Retirement    Date,
                                    provided,  however,  a Participant  may
                                    designate a new alternate  recipient if
                                    the one first  designated  dies  before
                                    the Participant and after the Effective
                                    Retirement Date.
                           (B)      In  the  event  of  the  death  of  the
                                    alternate  recipient  prior to the date
                                    as   of   which   the    election    is
                                    irrevocable,      the     Participant's
                                    selection  of this option shall be void
                                    and  the  Participant  may  change  the
                                    alternate   recipient   or  change  the
                                    option   elected,    subject   to   the
                                    applicable  limitations  and conditions
                                    applied to  elections  for the  options
                                    described under 5.04(a)(1) and (2).
         (C)      Actuarial  equivalence under this sub-paragraph (5) shall
                  be  determined on the basis of the  applicable  actuarial
                  assumptions  and other relevant  provisions  used for the
                  same in the Pension Plan.
         5.05.    PAYMENT OF SMALL AMOUNTS
                  Unless  such  Participant  elects to  receive  his or her
                  benefit in a lump sum as provided in Section 5.04, in the
                  event a monthly  benefit  under  this  Plan,  payable  to
                  either  a  Participant   or  to  his  or  her  contingent
                  annuitant,  alternate  recipient or surviving  spouse, is
                  too small (in the sole  judgment  of  Ashland) to be paid
                  monthly,    such   benefit   may   be   paid   quarterly,
                  semi-annually,  or annually,  as determined by Ashland to
                  be administratively convenient.
         5.06.    SURVIVING BENEFITS
                  (a)      Except as otherwise  provided in Section 5.04 of
                           this  Plan,  in the  event  that  a  Participant
                           receiving  Annual   Retirement  Income  benefits
                           shall die after his or her Effective  Retirement
                           Date, no additional benefits shall be payable by
                           Ashland   under  this  Plan  to  such   deceased
                           Participant's   beneficiaries,   survivors,   or
                           estate.
                  (b)      If an Employee dies while in active service with
                           Ashland
                           (1) prior to approval for  participation  in the
                           Plan  and  said  Employee  is a  Level  I or  II
                           participant  under  the  Incentive  Compensation
                           Plan; or
                           (2) after approval for participation in the Plan
                           but  prior to  making an  election  pursuant  to
                           Section  5.04(a) and said  Employee is a Level I
                           -V participant under the Incentive  Compensation
                           Plan; then such Employee shall be deemed:
                           (i) to be a  Participant  under  the Plan in the
                           case  of  Section  5.06  (b)(1);  (ii)  to  have
                           commenced participation one (1) day prior to the
                           date of the Employee's  death; and (iii) to have
                           elected to receive  his or her  benefits  in the
                           form of the  100%  Joint &  Survivor  retirement
                           income option and to have  designated his or her
                           spouse as the beneficiary thereunder.
                  (c)      In  the  event  an  Employee  is  approved   for
                           participation  under  the Plan  and  dies  after
                           having made an election  under  Section  5.04(a)
                           but  prior  to his or her  Effective  Retirement
                           Date, then such Employee shall be deemed to have
                           commenced participation one (1) day prior to the
                           date of the  Employee's  death and payment shall
                           be made under this Plan in  accordance  with the
                           Employee's election.
5.07     PARTICIPATION IN OTHER BENEFITS
         After a Participant's  Effective  Retirement Date, he or she shall
         continue to participate in Ashland's Group Life Insurance, Medical
         and Dental  programs  in the same  manner and under the same terms
         and  conditions  as  provided  for  retirees  as a class under the
         provisions  of  such  programs,  as from  time to time in  effect.
         Except  as   otherwise   expressly   provided  in  this  Plan,   a
         Participant's   active   participation  in  all  employee  benefit
         programs  maintained by Ashland derived from his or her employment
         status with Ashland shall be discontinued.
ARTICLE VI.  CHANGE IN CONTROL.
         Notwithstanding any provision of this Plan to the contrary, in the
         event of a Change in Control,  an  Employee  who is deemed to be a
         Level I, II, III, IV or V participant  under  Ashland's  Incentive
         Compensation   Plan,  shall,  in  accordance  with  Section  3.03,
         automatically  be deemed  approved  for  participation  under this
         Plan.  Consistent  with the applicable  terms of Sections 5.01 and
         5.02, such a Participant may, in his or her sole discretion, elect
         to retire prior to Age 62. In addition,  Ashland (or its successor
         after the Change in Control) shall reimburse an Employee for legal
         fees, fees of other experts and expenses incurred by such Employee
         if he or she is  required  to, and is  successful  in,  seeking to
         obtain or enforce any right to payment  pursuant  to the Plan.  In
         the  event  that it shall be  determined  that  such  Employee  is
         properly  entitled  to the  payment of  benefits  hereunder,  such
         Employee shall also be entitled to interest  thereon payable in an
         amount  equivalent  to the  prime  rate  of  interest  (quoted  by
         Citibank,  N.A. as its prime commercial lending rate on the latest
         date practicable  prior to the date of the actual  commencement of
         payments) from the date such  payment(s)  should have been made to
         and including the date it is made.  Notwithstanding  any provision
         of this Plan to the contrary,  the  provisions of this Plan or any
         other  plan of  Ashland  Inc.  having  a  material  impact  on the
         benefits payable under this Plan may not be amended after a Change
         in Control occurs without the written consent of a majority of the
         Board who were directors prior to the Change in Control.
ARTICLE VII.      MISCELLANEOUS.
7.01     The obligations of Ashland hereunder constitute merely the promise
         of  Ashland to make the  payments  provided  for in this Plan.  No
         employee,  his or her spouse or the estate of either of them shall
         have, by reason of this Plan, any right,  title or interest of any
         kind  in  or to  any  property  of  Ashland.  To  the  extent  any
         Participant  has a right to receive  payments  from Ashland  under
         this Plan,  such right  shall be no greater  than the right of any
         unsecured general creditor of Ashland.
7.02     Full power and  authority to construe,  interpret  and  administer
         this  Plan  shall be vested  in the  Board or its  delegate.  This
         includes,   without  limitation,   the  ability  to  make  factual
         determinations,  construe and  interpret  provisions  of the Plan,
         reconcile any  inconsistencies  between  provisions in the Plan or
         between provisions of the Plan and any other statement  concerning
         the Plan,  whether  oral or written,  supply any  omissions to the
         Plan or any document  associated with the Plan, and to correct any
         defect in the Plan or in any  document  associated  with the Plan.
         Decisions of the Board or its delegate shall be final,  conclusive
         and binding  upon all  parties,  provided,  however,  that no such
         decision may adversely  affect the rights of any  Participant  who
         has been approved for participation in the Plan under the terms of
         Section 3.03 and whose  benefit is  determined  under the terms of
         Section 5.01(d) or Section 5.02(b).
7.03     This Plan shall be binding upon Ashland and any  successors to the
         business  of  Ashland  and  shall  inure  to  the  benefit  of the
         Participants  and their  beneficiaries,  if applicable.  Except as
         otherwise  provided in Article VI, the Board or its delegate  may,
         at any time, amend this Plan,  retroactively or otherwise,  but no
         such amendment may adversely  affect the rights of any Participant
         who has been approved for  participation in the Plan except to the
         extent that such action is required by law.
7.04     Except as otherwise provided in Section 5.04, no right or interest
         of the Participants  under this Plan shall be subject to voluntary
         or involuntary alienation, assignment or transfer of any kind.
7.05     This Plan shall be  governed  for all  purposes by the laws of the
         Commonwealth of Kentucky.
7.06     If any term or provision of this Plan is  determined by a court or
         other appropriate authority to be invalid,  void, or unenforceable
         for any reason,  the remainder of the terms and provisions of this
         Plan shall  remain in full force and effect and shall in no way be
         affected, impaired or invalidated.