INDEMNIFICATION AGREEMENT

     This  Agreement  is made this  _____ day of  ______,  _______  between
ASHLAND  INC.,  a Kentucky  corporation  ("Company"),  and the  undersigned
individual ("Director").

                                WITNESSETH:

     WHEREAS, Director is a member of the Board of Directors of Company and
in such capacity is performing a valuable service for Company; and

     WHEREAS, Article X of the Second Restated Articles of Incorporation of
Company  (the  "Article")  authorizes  Company to  indemnify  directors  of
Company to the maximum extent permitted by law; and

     WHEREAS,  the Article  authorizes Company to enter into contracts with
members of its Board of Directors with respect to  indemnification  of such
directors; and

     WHEREAS,  recent  developments  with respect to the  applications  and
enforcement of indemnification provisions and the availability of insurance
to protect  directors against  liabilities  generally have raised questions
concerning  the  adequacy and  reliability  of the  protection  afforded to
directors thereby; and

     WHEREAS, to provide greater certainty with respect to Director's right
to indemnification and the payment thereof,  and thereby induce Director to
serve as a member  of the  Board  of  Directors  of  Company,  Company  has
determined and agreed to enter into this Agreement with Director.

     Now, THEREFORE, in consideration of Director's agreement to serve as a
Director  after the date of this  Agreement,  Company and Director agree as
follows:

     1. INDEMNITY OF DIRECTOR.  Subject only to the exclusions set forth in
Sections 2 and 12 of this Agreement, Company hereby agrees to hold harmless
and indemnify  Director  against any and all reasonable  costs and expenses
(including,  but not  limited  to,  attorneys'  fees)  and any  liabilities
(including, but not limited to, judgments,  fines, penalties and reasonable
settlements)  paid by or on behalf  of, or  imposed  against,  Director  in
connection with any threatened, pending or completed claim, action, suit or
proceeding,   whether   civil,   criminal,   administrative,   legislative,
investigative or other (including any appeal relating  thereto) and whether
made or  brought  by or in the  right of  Company  or  otherwise,  in which
Director  is,  was or at  any  time  becomes  a  party  or  witness,  or is
threatened to be made a party or witness,  or  otherwise,  by reason of the
fact that  Director  is, was or at any time  becomes a  director,  officer,
employee  or agent of Company or a  director,  officer,  partner,  trustee,
employee or agent of an Affiliate of Company,  as hereafter defined, or any
employee  benefit plan  maintained by Company or any Affiliates of Company.
As used in this Agreement,  an Affiliate of Company means any  corporation,
partnership  or other entity which,  directly or indirectly,  controls,  is
controlled by or is under common control with Company.

     2.  LIMITATIONS  ON INDEMNITY.  No indemnity  pursuant to Section 1 of
this Agreement shall be paid by Company:

     A. if a court of competent  jurisdiction  renders a final adjudication
on the merits,  in an action,  suit or  proceeding  in which  Director is a
party, that such indemnification is prohibited by law; or

     B. in connection with any transaction with respect to which a court of
competent  jurisdiction  renders a final  adjudication on the merits, in an
action,  suit  or  proceeding  in  which  Director  is a  party,  [i]  that
Director's  personal  financial interest was in conflict with the financial
interests of Company or its shareholders,  or [ii] that Director derived an
improper personal benefit; or

     C. on account of acts or  omissions  of Director to the extent a court
of competent jurisdiction renders a final adjudication on the merits, in an
action,  suit or proceeding in which Director is a party, that such acts or
omissions  [i]  were  not in  good  faith,  or  [ii]  involved  intentional
misconduct, or [iii] were known to Director to be a violation of law; or

     D. in respect of any  liability  to Company to the extent that a court
of competent jurisdiction renders a final adjudication on the merits, in an
action,  suit or  proceeding  in  which  Director  is a  party,  that  such
liability to Company  arises under any federal or state  statute  providing
for liability directly to Company by reason of the fact that Director is or
was a director of Company, including, by way of example and not limitation,
liability  under Section 16(b) of the  Securities  Exchange Act of 1934, as
amended (the "Exchange Act"); or

     E. to the  extent and only to the  extent  that,  prior to a Change of
Control,  as hereinafter  defined,  a majority of the Board of Directors of
Company or a duly designated  committee thereof,  in either case consisting
of directors who are not at the time parties to the claim,  action, suit or
proceeding against Director,  determines that the amount of expenses and/or
settlements for which indemnification is sought is unreasonable; or

     F. in connection  with any claim,  suit,  action or proceeding  [i] if
such claim,  action, suit or proceeding was initiated by Director or his or
her  personal  or  legal   representative,   or  involved   the   voluntary
solicitation  or  intervention  by Director or his or her personal or legal
representative (other than an action to enforce  indemnification  rights or
an  action  initiated  with the  approval  of a  majority  of the  Board of
Directors),  or  [ii]  to the  extent  that  such  claim,  action,  suit or
proceeding  arose as a result of acts or  omissions  of Director  occurring
prior to the date of this Agreement.

     For purposes of this Agreement,  a "Change in Control" shall be deemed
to have  occurred  if [i] any  "person"  (as such term is used in  Sections
13(d)  and  14(d) of the  Exchange  Act),  other  than a  trustee  or other
fiduciary holding securities under an employee benefit plan of Company or a
corporation owned,  directly or indirectly,  by the shareholders of Company
in  substantially  the  same  proportions  as their  ownership  of stock of
Company,  is or becomes  the  "beneficial  owner" (as defined in Rule 13d-3
under the Exchange  Act),  directly or  indirectly of securities of Company
representing  20% or more of the combined  voting  power of Company's  then
outstanding  voting  securities;  or [ii] during any period of  twenty-four
(24) consecutive months (not including any period prior to the date of this
Agreement), individuals who at the beginning of such period constituted the
Board of Directors  of Company and any new director  (other than a director
designated  by a person who has entered into an  agreement  with Company to
effect a transaction  described in clauses [ii or [iii] of this  Paragraph)
whose  election by the Board of  Directors  or  nomination  for election by
Company's  shareholders was approved by a vote of at least two-thirds (2/3)
of the  directors  then still in office who either  were  directors  at the
beginning of the period or whose  election or  nomination  for election was
previously  so approved,  cease for any reason to  constitute a majority of
the Board of  Directors  or [iii] the  shareholders  of  Company  approve a
merger or consolidation of Company with any other corporation, other than a
merger or  consolidation  which would  result in the voting  securities  of
Company  outstanding or by being  converted  into voting  securities of the
surviving  entity) at least 70% of the combined  voting power of the voting
securities  of Company or such  surviving  entity  outstanding  immediately
after such merger of  consolidation;  or [iv] the  shareholders  of Company
approve a plan of complete  liquidation  of Company or an agreement for the
sale or  disposition by Company of all or  substantially  all of the assets
owned by Company, whether directly or indirectly.

     3.  CONTINUATION  OF INDEMNITY.  All  agreements  and  obligations  of
Company  contained  in this  Agreement  shall  continue  during  the period
Director serves in any capacity entitling Director to indemnification under
this Agreement and shall  continue  thereafter so long as Director shall be
subject to any possible claim or threatened,  pending or completed  action,
suit or proceeding, whether civil, criminal, administrative, legislative or
investigative, or other, arising as a result of acts or omissions occurring
during the period Director served as a director of Company.

     4.  NOTIFICATION  OF  CLAIM.  It shall  be a  condition  precedent  to
indemnification under this Agreement that, within twenty days after receipt
by Director of actual notice that  Director is or will be a party,  witness
or  otherwise  involved  in any  threatened  or  pending  action,  suit  or
proceeding  described in Section 1 of this  Agreement,  Director shall have
notified Company in writing of the assertion or commencement  thereof;  but
the omission to so notify  Company  will not relieve it from any  liability
which it may have to Director otherwise than under this Agreement.

     5. ADVANCEMENT OF COSTS AND EXPENSES.  The costs and expenses incurred
by Director in  investigating,  defending or appealing  any  threatened  or
pending  claim or any  threatened  or pending  action,  suit or  proceeding
described in Section 1 of this Agreement  shall,  at the written request of
Director,  be paid by Company in advance of final  judgment  or  settlement
with the  understanding,  undertaking and agreement hereby made and entered
into by Director and Company,  that  Director  shall,  if it is  ultimately
determined  in  accordance  with  Section 2 or  pursuant to Section 12 that
Director is not entitled to be indemnified, or was not entitled to be fully
indemnified,  repay to Company  such  amount,  or the  appropriate  portion
thereof,  so paid or  advanced.  Such  advancements  shall be made at least
quarterly.

     6.  ENFORCEMENT.  If a claim for payment  under this  Agreement is not
paid in full by Company  within ninety days after a written demand has been
delivered by Director to Company, or within thirty days after delivery of a
written  demand by Director to Company based upon a final and  unappealable
judgment of a court of  competent  jurisdiction,  Director  may at any time
thereafter  bring suit against  Company to recover the unpaid amount of the
claim  and,  if  successful  in whole or in part,  Director  shall  also be
entitled to be paid all costs and  expenses  (including  but not limited to
attorneys' fees) incurred by Director in prosecuting such suit. In any suit
brought by Director to enforce this Agreement, the burden of proof shall be
on Company to establish  that Director is not entitled to the relief sought
under this Agreement.


     7.  ESTABLISHMENT  OF SECURITY.  In the event of a Potential Change in
Control,  as hereafter  defined,  Company  shall,  upon written  request of
Director,  obtain an  irrevocable  letter of credit  issued by a commercial
bank,  satisfactory  to  Director,  which  letter of credit shall be in the
amount of $10,000,000, shall have a term of ten years, shall name Director,
and  Director's  spouse,  heirs and personal and legal  representatives  as
beneficiary and shall permit  Director,  and Director's  heirs and personal
and legal representatives to draw thereunder from time to time such amounts
as are due and owing to Director under this Agreement,  whether in the form
of an  advancement  or  indemnification  or  otherwise,  upon  delivery  of
Director's  certificate  to the effect that Director is entitled to be paid
such  amounts  pursuant to the terms of this  Agreement.  The issuer of the
letter of credit  shall be chosen by Director  and all  expenses,  fees and
other   disbursements   incurred  in  connection   with  the  issuance  and
enforcement of such letter of credit shall be paid by Company.  Obtaining a
letter of credit shall not relieve Company of any of its obligations  under
this Agreement.

     The parties  acknowledge that Director will have no adequate remedy at
law if Company  breaches  its  obligations  under this Section 7, and agree
that, in addition to any other  remedies  which may be available,  Director
shall be entitled to the equitable  remedy of specific  performance  in the
event of a breach  or  threatened  breach  by  Company  of its  obligations
hereunder.

     For purposes of this Agreement,  a "Potential Change in Control" shall
be deemed to have  occurred if [i] Company  enters into an  agreement,  the
consummation  of which  would  result  in the  occurrence  of a  Change  in
Control; [i] any person (including Company) publicly announces an intention
to  take  or to  consider  taking  actions  which,  if  consummated,  would
constitute a Change in Control;  [iii] any person,  other than a trustee or
other  fiduciary  holding  securities  under an  employee  benefit  plan of
Company or a corporation owned, directly or indirectly, by the stockholders
of Company in  substantially  the same  proportions  as their  ownership of
stock of Company,  who is on the date  hereof,  or hereafter  becomes,  the
beneficial  owner,  directly  or  indirectly,   of  securities  of  Company
representing  9.5% or more of the combined  voting power of Company's  then
outstanding voting securities, hereafter or thereafter increases Director's
beneficial  ownership of such securities by one-half  percent (.5%) or more
over the  percentage  so owned by such  person on the date hereof or on the
date of becoming such a beneficial owner; or [iv] the Board of Directors of
Company  adopts a  resolution  to the effect  that,  for  purposes  of this
Agreement, a Potential Change in Control has occurred.

     8.  CONTRIBUTION.  If the full indemnity provided in Section 1 of this
Agreement may not be paid to Director because of any exclusion in Section 2
of this  Agreement,  then in  respect of any  actual or  threatened  claim,
action, suit or proceeding in which Company is jointly liable with Director
(or would be if joined  in such  claim)  Company  shall  contribute  to the
amount of expenses and liabilities  incurred by Director in such proportion
as is appropriate to reflect [i] the relative  benefits received by Company
on the one hand and  Director on the other hand from the acts or  omissions
from  which  such  claim,  action,  suit or  proceeding  arose and [ii] the
relative fault of Company, including its other directors, officers, agents,
employees and other representatives, on the one hand and of Director on the
other hand in connection  with the acts or omissions which resulted in such
claim, action, suit or proceeding,  as well as any other relevant equitable
considerations.   The  relative  fault  of  Company,  including  its  other
directors,  officers,  agents, employees and other representatives,  on the
one hand and of Director on the other hand shall be determined by reference
to, among other things, the parties' relative intent, knowledge,  access to
information  and  opportunity  to  correct  or  prevent  the  circumstances
resulting in such claim, action, suit or proceeding. Company agrees that it
would not be just and equitable if contribution  pursuant to this Section 8
were  determined  by pro rata  allocation or any other method of allocation
which does not take into account the foregoing equitable considerations.

     9. PARTIAL  INDEMNITY.  If Director is entitled under any provision of
this Agreement to  indemnification  by Company for some or a portion of the
costs,   expenses,   judgments,   fines,  penalties  and  amounts  paid  in
settlement,   but  not  for  the  total  amount   thereof,   Company  shall
nevertheless  indemnify  Director for the portion thereof to which Director
is entitled.

     10. NON-EXCLUSIVITY. The rights of Director under this Agreement shall
be in  addition  to any other  rights  Director  may have  under the Second
Restated Articles of Incorporation or By-laws of Company,  both as amended,
agreement,  vote of shareholders or disinterested directors, as a matter of
law or otherwise.

     11.  SUBROGATION.  In the event of any payment  under this  Agreement,
Company  shall be  subrogated  to the extent of such  payment to all of the
rights of recovery of Director,  who shall execute all papers  required and
shall do everything that may be necessary to secure such rights,  including
the execution of such documents  necessary to enable Company effectively to
bring suit to enforce such rights.

     12. NO DUPLICATION OF PAYMENTS. Company shall not be liable under this
Agreement to make any payment to the extent Director has otherwise actually
received payment (under any insurance  policy,  By-law or otherwise) of the
amounts otherwise  payable by Company under this Agreement.  Director shall
use best  efforts to collect from all third  parties any amounts  otherwise
payable by Company under this Agreement. If Director is entitled to but has
not  received  payment from a third party  (under any  insurance  policy or
otherwise)  of  amounts   otherwise  payable  by  the  Company  under  this
Agreement,  Company shall  nevertheless  pay Director such amounts with the
understanding,  undertaking  and agreement  hereby made and entered into by
Director  and Company that  Director  will repay to Company such amounts to
the extent they are ultimately paid to Director by such third party.

     13. BINDING EFFECT.  This Agreement shall be binding upon and inure to
the  benefit  of and  be  enforceable  by  the  parties  hereto  and  their
respective  successors  and  assigns,  including  any  direct  or  indirect
successor  by  purchase,  merger,  consolidation  or  otherwise  to  all or
substantially  all of the business  and/or  assets of Company,  heirs,  and
personal and legal representatives;  provided, however, that this Agreement
is  personal  to  Director  and may not be  transferred  or  encumbered  by
Director in any way.

     14. SEVERABILITY.  The provisions of this Agreement shall be severable
in the event that any of the  provisions  hereof  (including  any provision
within a single  section,  paragraph  or  sentence)  are held by a court of
competent jurisdiction to be invalid, void or otherwise unenforceable,  and
the remaining  provisions  shall remain  enforceable  to the fullest extent
permitted by law.

     15. GOVERNING LAW; AMENDMENT.

     A. This Agreement shall be interpreted and enforced in accordance with
the laws of the  Commonwealth of Kentucky.

     B. No amendment,  modification,  termination or  cancellation  of this
Agreement  shall be  effective  unless in  writing  signed by both  parties
hereto.

     16.  NOTICES.  Any notice to Company or Director  under this Agreement
shall be in writing and shall be delivered  personally or sent by overnight
courier service or certified mail:

        If to Company:                       Ashland Inc.
                                             50 E. RiverCenter Blvd.
                                             P.O. Box 391
                                             Covington, Kentucky 41012-0391
                                             Attn: Secretary

        If to Director:
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                                            -------------------------------
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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on
and as of the day and year first above written.

                                            ASHLAND INC.

                                            By:
                                               ---------------------------------

                                            Title:  Chairman of the Board and
                                                     Chief Executive Officer


                                            Director:

                                            ------------------------------------
                                           [Director Name]