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                                                                  EXHIBIT 10.7



                                THE GEON COMPANY

                           DEFERRED COMPENSATION PLAN
                           FOR NON-EMPLOYEE DIRECTORS
                          (Effective December 9, 1993)
       (Amended February 1, 1996, November 6, 1996, and November 4, 1998)

                                    ARTICLE I
                               PURPOSE OF THE PLAN

         The purpose of The Geon Company (the "Company") Deferred Compensation
Plan for Non-Employee Directors is to provide any Non-Employee Director of the
Company the option to defer receipt of the compensation payable for services as
a Director and to build loyalty to the Company through increased ownership in
the Company's Common Stock.

                                   ARTICLE II
                                   DEFINITIONS

         As used herein, the following words shall have the meaning stated after
them unless otherwise specifically provided:

         2.1 "Calendar Year" shall mean the twelve month period January 1
through December 31.

         2.2 "Change of Control" shall mean:

                  (i) The acquisition by any individual, entity or group (within
         the meaning of Section 13(d)(3) or 14(d)(2) of the Securities Exchange
         Act of 1934, as amended (the "Exchange Act")) (a "Person") of
         beneficial ownership (within the meaning of Rule 13d-3 promulgated
         under the Exchange Act) of voting securities of the Company where such
         acquisition causes such Person to own 20% or more of the combined
         voting power of the then outstanding voting securities of the Company
         entitled to vote generally in the election of directors (the
         "Outstanding Company Voting Securities"); provided, however, that for
         purposes of this subsection (a), the following acquisitions shall not
         be deemed to result in a Change of Control: (i) any acquisition
         directly from the Company, (ii) any acquisition by the Company, (iii)
         any acquisition by any employee benefit plan (or related trust)
         sponsored or maintained by the Company or any corporation controlled by
         the Company or (iv) any acquisition by any corporation pursuant to a
         transaction that complies with clauses (i), (ii) and (iii) of
         subsection (c) below; provided, further, that if any Person's
         beneficial ownership of the Outstanding Company Voting Securities
         reaches or exceeds 20% as a result of a transaction described in clause
         (i) or (ii) above, and such Person subsequently acquires beneficial
         ownership of additional voting securities of the Company, such



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         subsequent acquisition shall be treated as an acquisition that causes
         such Person to own 20% or more of the Outstanding Company Voting
         Securities; and provided, further, that if at least a majority of the
         members of the Incumbent Board determines in good faith that a Person
         has acquired beneficial ownership (within the meaning of Rule 13d-3
         promulgated under the Exchange Act) of 20% or more of the Outstanding
         Company Voting Securities inadvertently, and such Person divests as
         promptly as practicable a sufficient number of shares so that such
         Person beneficially owns (within the meaning of Rule 13d-3 promulgated
         under the Exchange Act) less than 20% of the Outstanding Company Voting
         Securities, then no Change of Control shall have occurred as a result
         of such Person's acquisition; or

                  (ii) individuals who, as of November 6, 1996, constitute the
         Board (the "Incumbent Board") cease for any reason to constitute at
         least a majority of the Board; provided, however, that any individual
         becoming a director subsequent to November 6, 1996 whose election, or
         nomination for election by the Company's shareholders, was approved by
         a vote of at least a majority of the directors then comprising the
         Incumbent Board shall be considered as though such individual were a
         member of the Incumbent Board, but excluding, for this purpose, any
         such individual whose initial assumption of office occurs as a result
         of an actual or threatened election contest with respect to the
         election or removal of directors or other actual or threatened
         solicitation of proxies or consents by or on behalf of a Person other
         than the Board; or

                  (iii) The consummation of a reorganization, merger or
         consolidation or sale or other disposition of all or substantially all
         of the assets of the Company or the acquisition of assets of another
         corporation ("Business Combination"); excluding, however, such a
         Business Combination pursuant to which (i) all or substantially all of
         the individuals and entities who were the beneficial owners of the
         Outstanding Company Voting Securities immediately prior to such
         Business Combination beneficially own, directly or indirectly, more
         than 60% of, respectively, the then outstanding shares of common stock
         and the combined voting power of the then outstanding voting securities
         entitled to vote generally in the election of directors, as the case
         may be, of the corporation resulting from such Business Combination
         (including, without limitation, a corporation that as a result of such
         transaction owns the Company or all or substantially all of the
         Company's assets either directly or through one or more subsidiaries)
         in substantially the same proportions as their ownership, immediately
         prior to such Business Combination of the Outstanding Company Voting
         Securities, (ii) no Person (excluding any employee benefit plan (or
         related trust) of the Company or such corporation resulting from such
         Business Combination) beneficially owns, directly or indirectly, 20% or
         more of, respectively, the then outstanding shares of common stock of
         the corporation resulting from such Business Combination or the
         combined voting power of the then outstanding voting securities of such



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         corporation except to the extent that such ownership existed prior to
         the Business Combination and (iii) at least a majority of the members
         of the board of directors of the corporation resulting from such
         Business Combination were members of the Incumbent Board at the time of
         the execution of the initial agreement, or of the action of the Board,
         providing for such Business Combination; or

                  (iv) approval by the shareholders of the Company of a complete
         liquidation or dissolution of the Company.

         2.3 "Committee" shall mean the Compensation Committee described in
Section 8.1 hereof.

         2.4 "Common Stock" shall mean the Common Stock, par value $0.10 per
share, of the Company.

         2.5 "Company" shall mean The Geon Company.

         2.6 "Director" shall mean any non-employee director of the Company.


                                   ARTICLE III
                             ELECTIONS BY DIRECTORS

         3.1 Election to Defer. A Director may elect to defer receipt of the
compensation payable to him or her for future services as a Director. Such
election shall be made on an election form specified by the Committee ("Election
Form"). Such election shall indicate the portion of the Director's compensation
to be invested in an interest-bearing account and the portion of such
compensation to be invested in Common Stock.

         3.2 Effectiveness of Elections. Elections shall be effective and
irrevocable upon the delivery of an Election Form to the Committee.
Notwithstanding anything to the contrary set forth herein, the effective date of
any transaction in which amounts deferred hereunder are invested in Common Stock
shall be not less than six months after the date of such election. Subject to
the provisions of Article VI, amounts deferred pursuant to such elections shall
be distributed at the time and in the manner set forth in such election.

         3.3 Amendment and Termination of Elections. A Director may terminate or
amend his or her election to defer receipt of compensation by written notice
delivered to the Committee six months prior to the commencement of the period
with respect to which such compensation will be earned. Amendments which serve
only to change the beneficiary designation shall be permitted at any time and as
often as necessary. Amounts credited to a Director's Account pursuant to Section
5.2 hereof prior to the effective date of any termination or amendment shall not
be affected thereby and shall be paid at the time and in the manner specified in
the election form in effect when the deferral occurred.



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                                   ARTICLE IV
                      COMMON STOCK AVAILABLE UNDER THE PLAN

         4.1 Common Stock. The aggregate number of shares of Common Stock that
may be granted under this Plan in any fiscal year of the Company during the term
of this Plan will be equal to one tenth of one percent (0.1 %) of the number of
shares of Common Stock outstanding as of the first day of that fiscal year.

         4.2 Adjustment. In the event of any change in the Common Stock of the
Company by reason of a merger, consolidation, reorganization, or similar
transaction, or in the event of a stock dividend, stock split, or distribution
to shareholders (other than normal cash dividends), the Committee will adjust
the number and class of shares that may be issued under this Plan, the number
and class of shares subject to outstanding deferrals, and the fair market value
of the Common Stock, and other determinations applicable to outstanding awards.

                                    ARTICLE V
                                    ACCOUNTS

         5.1 Accounts. The Company shall establish and maintain a Deferred
Compensation Account (an "Account") for each Director who elects to defer
compensation under the Plan. If the Director elects to have deferred
compensation invested in an interest-bearing account, the Company shall credit
the Account of the Director with an amount equal to one hundred percent (100%)
of the compensation deferred pursuant to this Plan. In the event that a Director
elects to have some or all of his or her compensation invested in Common Stock,
then the Company shall credit the Account of the Director with an amount equal
to one hundred twenty-five percent (125%) of such compensation, in the form of a
number of shares of Common Stock, valued at its Fair Market Value. As used
herein, the Fair Market Value of Common Stock shall be the average of the high
and low prices of the Company's Common Stock as reported on the composite tape
for securities listed on the New York Stock Exchange for the date immediately
preceding the date of crediting the Account, provided that if no sales of Common
Stock were made on said exchange on that date, the Fair Market Value shall be
the average of the high and low prices of Common Stock as reported on said
composite tape for the preceding day on which sales of Common Stock were made on
said Exchange. The Accounts shall be credited as of the date on which the
compensation would otherwise have been paid to the Director, if not deferred
under the Plan.

         5.2 Adjustment of Accounts. As of December 31 of each Calendar Year and
on such other dates as the Committee directs, the fair market value of the
Account of each Director shall be determined by crediting to the Account an
amount equal to the income earned during the Calendar Year, or other appropriate
period, the number of shares of Common Stock credited to the Account, and then
determining the fair market value of the shares and other amounts credited to
the Account.



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                                   ARTICLE VI
                               PAYMENT OF ACCOUNTS

         6.1 Time of Payment. Payment of the amount credited to a Director's
Account shall commence upon a date which is not more than thirty days after the
earlier of (i) the attainment of the date specified (not younger than age 55) in
his Election Form or (ii) upon a Change of Control.

         6.2 [WITH RESPECT TO AMOUNTS DEFERRED PRIOR TO JANUARY 1, 1996] Method
of Payment. The amount credited to a Director's Deferred Compensation Account
shall be paid, in whole or in part, to the Director in a lump sum and/or in
annual installments over a period of not more than ten years as specified in
each Director's Election Form. Deferred Compensation Accounts shall be paid in
kind, in cash, or shares of Common Stock, as credited to the Account.

         [WITH RESPECT TO AMOUNTS DEFERRED FROM AND AFTER JANUARY 1, 1996]
Method of Payment. The amount credited to a Director's Deferred Compensation
Account shall be paid, in whole or in part, to the Director in a lump sum and/or
in annual installments over a period of not more than ten years as specified in
each Director's Election Form. A Director may elect to change his or her
original payment period election, as specified in such Director's Election Form;
provided, that (i) such change is approved by the Committee, (ii) the election
to change is made at least 18 months prior to date specified in the electing
Director's Election Form on which payment of the amount credited to the
Director's account is to commence, and (iii) a Director may make such an
election to change only one time, an such election to change shall apply to all
of the Director's Election Forms with respect to amounts deferred under the Plan
from and after January 1, 1996. In the event that a Director who makes an
election to change is a member of the Committee, such Director shall abstain
from the Committee's determination whether or not to approve the change.
Deferred Compensation Accounts shall be paid in kind, in cash, or shares of
Common Stock, as credited to the Account.

         6.3 Hardship Distribution. Prior to the time a Director's Account
becomes payable, the Committee, in its sole discretion, may elect to distribute
all or a portion of the Director's Account in the event such Director requests a
distribution on account of severe financial hardship. For purposes of this Plan,
severe financial hardship shall be deemed to exist in the event the Committee
determines that a Director needs a distribution to meet immediate and heavy
financial needs resulting from a sudden or unexpected illness or accident of the
Director or a member of his or her family, loss of the Director's property due
to casualty, or other similar extraordinary and unforeseeable circumstances
arising as a result of events beyond the control of the Director. A distribution
based on financial hardship shall not exceed the amount required to meet the
immediate financial need created by the hardship. The amount of a Director's
Account shall be reduced by the amount of any hardship distribution to such
Director.

         6.4 Designation of Beneficiary. Upon the death of a Director, the
amount credited to his or her Account shall be paid to the beneficiary or
beneficiaries designated by him or her. If there is no designated beneficiary,
or no designated beneficiary surviving at a Director's death, 



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payment of a Director's Account shall be made to his or her estate. Beneficiary
designations shall be made in writing. A Director may designate a new
beneficiary or beneficiaries at any time by notifying the Committee.

         6.5 Taxes. In the event any taxes are required by law to be withheld or
paid from any payments made pursuant to the Plan, the appropriate amounts shall
be deducted from such payments and transmitted to the appropriate taxing
authority.

                                   ARTICLE VII
                                    CREDITORS

         7.1 Claims of the Company's Creditors. The rights of a Director or his
or her beneficiaries to any payment under the Plan shall be no greater than the
rights of an unsecured creditor of the Company.

                                  ARTICLE VIII
                                 ADMINISTRATION

         8.1 Appointment of Committee. The Board of Directors of the Company
shall appoint a Committee consisting of not less than three persons to
administer the Plan. Members of the Committee shall hold office at the pleasure
of the Board of Directors and may be dismissed at any time with or without
cause. Such persons serving on the Committee need not be members of the Board of
Directors of the Company.

         8.2 Powers of the Committee. The Committee shall administer the Plan
and resolve all questions of interpretation arising under the Plan with the help
of legal counsel, if necessary. Whenever directions, designations, applications,
requests or other notices are to be given by a Director under the Plan, they
shall be filed with the Committee. The Committee shall have no discretion with
respect to Plan contributions or distributions but shall act in an
administrative capacity only. Except as provided in the immediately following
sentence, all decisions by the Committee will be made with the approval of not
less than a majority of its members. In furtherance and not in limitation of the
authority granted in clause (vi) of this paragraph, any interpretation by a
majority of the Incumbent Directors then serving on the Committee as to whether
a sale or other disposition of assets by the Company or an acquisition of assets
of another corporation constitutes a "sale or other disposition of all or
substantially all of the assets of the Company or the acquisition of assets of
another corporation" for purposes of clause (iii) of the definition of "Change
of Control" in Section 2.2 hereof shall be final and binding for all purposes of
this Plan and any Accounts hereunder, notwithstanding that the transaction in
question was, or is contemplated to be, submitted to stockholders of the Company
for their approval and notwithstanding such approval




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                                   ARTICLE IX
                                 MISCELLANEOUS


         9.1 Term of Plan. The Company reserves the right to amend or terminate
the Plan at any time; provided, however, that no amendment or termination shall
affect the rights of Directors to amounts previously credited to their Accounts
pursuant to Section 5.1 or to future income to be credited to their Accounts
pursuant to Section 5.2.

         9.2 Assignment. No right or interest of any Director (or any person
claiming through or under such Director) in any benefit or payment herefrom
other than the surviving spouse of such Director after he or she is deceased,
shall be assignable or transferable in any manner or be subject to alienation,
anticipation, sale, pledge, encumbrance, or other legal process or in any manner
be liable for or subject to the debts or liabilities of such Director. If any
Director or any such person (other than the surviving spouse of such Director
after he or she is deceased) shall attempt to or shall transfer, assign,
alienate, anticipate, sell, pledge, or otherwise encumber his or her benefits
hereunder or any part thereof, or if by reason of his or her bankruptcy or other
event happening at any time such benefits would devolve upon anyone else or
would not be enjoyed by him or her, then the Committee, in its discretion, may
terminate his or her interest in any such benefit to the extent the Committee
considers necessary or advisable to prevent or limit the effects of such
occurrence. Termination shall be effected by filing a written "termination
declaration" with the Committee records and making reasonable efforts to deliver
a copy to such Director or his or her legal representative.

         As long as any Director is alive, any benefits affected by the
termination may, in the Committee's sole and absolute judgment, be paid to or
expended for the benefit of such Director, his or her spouse, his or her
children or any other person or persons in fact dependent upon him or her in
such a manner as the Committee shall deem proper. Upon the death of any
Director, all benefits withheld from him or her and not paid to others in
accordance with the preceding sentence shall be distributed to such Director's
estate or to his or her creditors and if such Director shall have descendants,
including adopted children, then living, distribution shall be made to such
Director's then living descendants, including adopted children, per stirpes.

         9.3 Effective Date of Plan. The Plan shall be effective as of December
9, 1993, subject to approval by the stockholders of the Company. Any amounts
credited to a Director's Deferred Compensation Account prior to such stockholder
approval shall be contingent on such approval.




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