NINTH AMENDED AND RESTATED
                                ASHLAND INC.
                     SUPPLEMENTAL EARLY RETIREMENT PLAN
                    FOR CERTAIN KEY EXECUTIVE EMPLOYEES
                                May 21, 1998

ARTICLE I.        PURPOSE AND EFFECTIVE DATE.
1.01     The purpose of the Plan is to allow  designated  senior  executive
         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     The Ninth  Amended and Restated  Ashland Inc.  Supplemental  Early
         Retirement  Plan for Certain  Key  Executive  Employees  is hereby
         amended   effective  May  21,  1998.   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 May 21,  1998  shall  be
         governed  by the  terms of the Plan in  effect at the time of such
         Employee(s)'   Effective   Retirement   Date(s)  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.  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 their
         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 their 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.
2.08     "Employee" - means an executive  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.
2.09     "Employment  Contracts" - 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.
2.12     "Incentive  Compensation  Plan" - means the Ashland Inc. Incentive
         Compensation Plan or the Ashland Inc. Incentive  Compensation Plan
         for Key Executives, as applicable.
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  Ninth  Amended  and  Restated  Ashland  Inc.
         Supplemental  Early  Retirement  Plan for  Certain  Key  Executive
         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.
ARTICLE III.      PARTICIPATION IN PLAN.
         Eligibility for benefits shall be determined as follows:
3.01     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     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 Executive  Vice  President or the
         Chief Financial Officer to participate in this Plan.
3.03     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 or II  Participant  under  the  Incentive
         Compensation Plan shall  automatically be deemed to be approved by
         the Board for participation under this Plan.
3.04     The Board or Chief Executive  Officer or Chief Operating  Officer,
         as applicable,  may approve such key executives for  participation
         in the  Plan  as  they  deem to be  appropriate,  all in its  sole
         discretion.
3.05     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 CONTRACTS.
4.01     Notwithstanding  any  provision of this Plan to the  contrary,  an
         Employee who has entered into an Employment  Contract 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,"  benefits payable  hereunder shall
         not include  those  benefits  which would have been payable to the
         Employee  during the first two (2) years of his or her  retirement
         under the Plan. 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 not  include  those
         benefits which would have been payable to the Employee  during the
         first three (3) years of his or her retirement under the Plan. The
         benefits  payable  hereunder  shall commence no earlier than as of
         the  first  day of the  calendar  month  coincident  with  or next
         following the third 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.
4.04     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  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 not be  entitled  to the  receipt  of any
         further  payments  of Annual  Retirement  Income  under this Plan;
         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.
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 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).
5.02     LEVELS III, IV AND V.
         The Annual  Retirement  Income of a Participant  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.
5.03     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,  subject to the discretion of
                           the  Committee  as described  below.  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 Committee
                           shall have the sole discretion to provide a lump
                           sum benefit  option to a class of retirees for a
                           given  calendar year. The decision as to whether
                           to  provide  a lump  sum  benefit  option  shall
                           generally  be made by the  Committee at the last
                           Committee  meeting  prior  thereto.  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     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 or II Participant under Ashland's  Incentive  Compensation
         Plan,  shall  automatically  be deemed to be approved by the Board
         for  participation  under  this  Plan and may,  in his or her sole
         discretion, elect to retire prior to the date the Employee reaches
         age 62. In addition, Ashland shall reimburse an Employee for legal
         fees  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 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.  Decisions
         of the  Board or its  delegate  shall  be  final,  conclusive  and
         binding upon all parties.
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.