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                                                                    EXHIBIT 10.1

           POLYONE CORPORATION SENIOR EXECUTIVE ANNUAL INCENTIVE PLAN

1.          PURPOSE. The PolyOne Corporation Senior Executive Annual Incentive
      Plan (the "PolyOne SEAIP") has been established to provide opportunities
      to certain key executive personnel of PolyOne Corporation (the "Company")
      to receive incentive compensation as a reward for high levels of
      performance above the ordinary performance standards compensated by base
      salary, and for their contributions to strong performance of the Company.
      The PolyOne SEAIP is designed to provide a competitive level of
      performance-based incentive compensation when all relevant performance
      objectives are achieved. This PolyOne SEAIP is intended to replace the
      existing Senior Executive PolyOne Annual Incentive Plan that was last
      approved by the shareholders of The Geon Company, the Company's
      predecessor, on April 19, 2000.

2.          ADMINISTRATION. The PolyOne SEAIP will be administered by the
      Compensation and Governance Committee of the Board of Directors of the
      Company (the "Committee"). The Committee is authorized to interpret the
      PolyOne SEAIP and to establish and maintain guidelines necessary or
      desirable for the administration of the PolyOne SEAIP. Decisions and
      determinations of the Committee shall be binding on all persons claiming
      rights under the PolyOne SEAIP. The Committee may delegate to the Chief
      Executive Officer or other officers, subject to such terms as the
      Committee shall determine, authority to perform certain functions,
      including administrative functions, except that the Committee shall retain
      exclusive authority to determine matters relating to awards to the Chief
      Executive Officer and other key executive personnel that are intended to
      qualify as performance-based compensation under Section 162(m) of the
      Internal Revenue Code of 1986, as amended (the "Code").

3.          ELIGIBILITY.

      (a)   Participation in the PolyOne SEAIP will be limited to those key
            executive personnel selected by the Committee who have the potential
            to influence significantly and positively the performance of the
            Company.

      (b)   To be eligible for participation in any particular year during the
            term of the PolyOne SEAIP (a "Plan Year"), a key executive must have
            assumed the duties of an incentive-eligible position and have been
            selected for participation in the PolyOne SEAIP within 90 days after
            the commencement of the applicable Plan Year. The foregoing and
            other provisions of the PolyOne SEAIP notwithstanding, the Committee
            may select any eligible employee who the Committee determines is not
            a "covered employee" in a given Plan Year to receive an award under
            the PolyOne SEAIP without complying with the timing and other
            limitations set forth in Sections 3(b), 4(b), 5 and 8(b). The
            Committee may also make awards to newly hired or newly promoted
            executives without compliance with such timing and other
            limitations, which awards may be based on performance during less
            than the full Plan Year. For purposes of the PolyOne SEAIP, a
            "covered employee" means an officer who the Committee deems likely
            to have compensation for the Plan Year which would be non-deductible
            by the

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            Company under Code Section 162(m) if the Company did not comply with
            the provisions of Code Section 162(m) and the regulations thereunder
            with respect to such compensation.

4.          TARGET AWARD LEVELS.

      (a)   For each Plan Year, each participant will be assigned a target level
            of incentive opportunity ("Incentive Percentage"), stated as a
            percentage of base salary, that will be available to the participant
            upon achievement of the Performance Targets (as hereinafter defined)
            for the respective Performance Measures (as hereinafter defined) for
            the applicable Plan Year. The maximum award that will be available
            to a participant is 200% of the participant's target level of
            incentive opportunity. In the case of a covered employee, unless the
            Committee specifies a separate maximum award amount that may be
            earned, the base salary upon which the Incentive Percentage is based
            will be that in effect at the time the Committee establishes the
            Incentive Percentage.

      (b)   Each participant's Incentive Percentage for each Plan Year will be
            approved by the Compensation Committee within 90 days after the
            commencement of the applicable Plan Year. In determining the
            applicable Incentive Percentage other than for the Chief Executive
            Officer, the Committee will consider the recommendations of the
            Chief Executive Officer of the Company.

5.          PERFORMANCE MEASURES AND TARGETS

      (a)   Within 90 days after the commencement of each applicable Plan Year,
            the Committee shall determine the performance goal targets
            ("Performance Targets") applicable to the measures of Company and/or
            business unit performance ("Performance Measures") which must be
            achieved in order for awards to be paid under the PolyOne SEAIP. If
            the Committee so determines, a Performance Target may include a
            minimum threshold performance level, a maximum performance level,
            and one or more intermediate performance levels or ranges, with
            target award levels or ranges that will correspond to the respective
            performance levels or ranges included in the Performance Target. The
            Committee may determine that only the threshold level relating to a
            Performance Measure must be met for awards to be paid under the
            Plan, and if multiple Performance Measures are selected for any Plan
            year, that awards will be paid under the Plan upon achievement of
            threshold levels of one or more of the specified Performance
            Measures. The Performance Measures may be made relative to the
            performance of other companies. The Performance Measures will
            include one or more of the following, as determined by the Committee
            for each Plan Year:

            (i)   PROFITS (e.g., operating income, EBIT, EBT, net income,
                  earnings per share, residual or economic earnings -- these
                  profitability metrics could be measured before special items
                  and/or subject to GAAP definition);

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            (ii)  CASH FLOW (e.g., EBITDA, operating cash flow, total cash flow,
                  cash flow in excess of cost of capital or residual cash flow
                  or cash flow return on investment);

            (iii) RETURNS (e.g., profits or cash flow returns on: assets,
                  invested capital, net capital employed, and equity);

            (iv)  WORKING CAPITAL (e.g., working capital divided by sales, days'
                  sales outstanding, days' sales inventory, and days' sales in
                  payables);

            (v)   PROFIT MARGINS (e.g., profits divided by revenues, gross
                  margins and material margins divided by revenues, and material
                  margin divided by sales pounds);

            (vi)  LIQUIDITY MEASURES (e.g., debt-to-capital, debt-to-EBITDA,
                  total debt ratio);

            (vii) SALES GROWTH, COST INITIATIVE AND STOCK PRICE METRICS (e.g.,
                  revenues, revenue growth, stock price appreciation, total
                  return to shareholders, sales and administrative costs divided
                  by sales, and sales and administrative costs divided by
                  profits); and

            (viii)STRATEGIC INITIATIVE KEY DELIVERABLE METRICS consisting of
                  one or more of the following: product development, strategic
                  partnering, research and development, market penetration,
                  geographic business expansion goals, cost targets, customer
                  satisfaction, employee satisfaction, management of employment
                  practices and employee benefits, supervision of litigation and
                  information technology, and goals relating to acquisitions or
                  divestitures of subsidiaries, affiliates and joint ventures.

      The foregoing terms shall have any reasonable definitions that the
Committee may specify.

      (b)   If more than one Performance Measure is selected by the Committee
            for a Plan Year, the Performance Measures will be weighted by the
            Committee to reflect their relative importance to the Company in the
            applicable Plan Year. The weightings of the Performance Measures
            shall also be determined by the Committee within 90 days after the
            commencement of each applicable Plan Year.

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6.          CERTIFICATION OF ACHIEVEMENT. Promptly following the end of each
      Plan Year the Committee will meet to certify achievement by the Company of
      the Performance Targets for the applicable Plan Year and, if such goals
      have been achieved, to review management recommendations and approve
      actual awards under the PolyOne SEAIP. The Committee shall certify in
      writing, in a manner conforming to applicable regulations under Section
      162(m), prior to payout of each award granted to a covered employee, that
      the Performance Targets relating to the award and other material terms of
      the award upon which payout was conditioned have been satisfied.

7.          DETERMINATION OF AWARDS. The amount of incentive awards available
      for payment to a participant under the PolyOne SEAIP will be the product
      of the participant's salary and the Incentive Percentage, adjusted to
      reflect the weightings, if any, assigned to the Performance Measures with
      respect to which the Performance Targets were met and further adjusted, in
      the case of any Performance Target for which the Committee determined more
      than one level or range of performance, to reflect the level or range of
      performance achieved; provided that the maximum annual dollar award (after
      giving effect to the 25% premium for restricted share deferrals provided
      for in Section 8) paid to any participant for any one Plan Year will be
      $2,000,000. No awards will be paid under the PolyOne SEAIP if none of the
      Performance Targets is achieved. Notwithstanding the amount of any
      available incentive award under the PolyOne SEAIP, the Committee may, in
      its discretion, reduce or eliminate the amount of any incentive award
      actually paid to a participant based on individual performance or
      otherwise. In no event may the Committee increase the amount of the
      maximum available incentive award (as described in Section 4(a) above) to
      a covered employee provided for under the PolyOne SEAIP.

8.          PAYMENT OF AWARDS.

      (a)   Awards will be paid as soon as practicable after approval by the
            Committee, but not later than 75 days after the end of the Plan Year
            to which the awards relate.

      (b)   The Committee may determine, within 90 days after the commencement
            of the applicable Plan Year, that all or a portion of the
            participant's award will be paid in the form of restricted shares or
            share equivalent units. If permitted by the Committee, participants
            will also have the opportunity to elect, within 120 days after the
            commencement of the applicable Plan Year, additional optional
            deferrals so that they may receive up to 100% of their award, if
            any, as restricted shares or share equivalent units.

      (c)   Any award paid as restricted shares or share equivalent units will
            be enhanced with a 25% "premium" (i.e., for every $100 deferred, the
            participant will receive $125 in restricted shares or share
            equivalent units). Any grants of restricted shares or share
            equivalent units will be made under PolyOne's current equity plan.
            Restrictions on the restricted shares or share equivalent units will
            be determined by the Committee at the time awards are approved in
            accordance with the provisions of the equity plan of the Company
            under which the shares are awarded. The number of restricted shares
            to be delivered or share equivalent

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            units to be credited to a participant in respect of his or her
            incentive award under the PolyOne SEAIP shall be determined by
            dividing the dollar amount of the incentive award (after giving
            effect to the 25% premium) under the PolyOne SEAIP by the fair
            market value of one common share of the Company on the first
            business day of the year immediately succeeding the Plan Year in
            respect of which the incentive award is made.

      (d)   For purposes of the PolyOne SEAIP, fair market value of one share
            shall be the mean of the high and low prices of the Company's common
            shares on the relevant date (or, if no sale was made on such date,
            then on the next preceding date on which such a sale was made) on
            the composite tape reporting transactions in securities listed on
            The New York Stock Exchange. If the Company's common shares are not
            listed on The New York Stock Exchange, the fair market value of one
            share of stock shall be as determined by the Committee.

      (e)   Any portion of a participant's award not paid as restricted shares
            or share equivalent units will be paid in cash. Other provisions of
            this Section 8 notwithstanding, the Committee may determine to pay
            out all or any portion of the award that otherwise would be payable
            as restricted shares or share equivalent units in cash (without
            payment of any "premium") in any circumstance deemed appropriate by
            the Committee.

9.          OTHER PROVISIONS.

      (a)   No awards under the PolyOne SEAIP are to be considered earned until
            received.

      (b)   Awards to participants who serve in incentive-eligible positions for
            less than a full year, or who within a year serve in two or more
            positions that are of significantly different size, may be adjusted
            on a pro rata basis.

10.         PAYMENT UPON CHANGE IN CONTROL.

      (a)   Unless otherwise provided in an individual agreement between the
            Company and a participant, within five days following the occurrence
            of a "Change in Control" (as defined in Attachment A hereto), the
            Company shall pay to each participant an interim lump-sum cash
            payment (the "Interim Payment") with respect to his or her
            participation in the PolyOne SEAIP. The amount of the Interim
            Payment shall equal the product of the number of months, including
            fractional months, that have elapsed until the occurrence of the
            Change in Control in the calendar year in which the Change in
            Control occurs and one-twelfth of the target level of incentive
            opportunity under the PolyOne SEAIP for the participant in effect
            prior to the Change in Control for the calendar year in which the
            Change in Control occurs.

      (b)   The Company will retain the obligation to make a final payment under
            the terms of the PolyOne SEAIP (if earned), but any Interim Payment
            made shall be offset against any later payment required to be made
            under the terms of the PolyOne SEAIP for the Plan Year in which a
            Change in Control occurs. In no event shall

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            any participant be required to refund to the Company, or have offset
            against any other payment due any participant from or on behalf of
            the Company, all or any portion of the Interim Payment.

11.         AMENDMENT; TERM OF THE POLYONE SEAIP.

      (a)   The PolyOne SEAIP may be amended by the Committee to the extent
            required in order to comply with the provisions of Section 162(m) of
            the Internal Revenue Code of 1986, as amended, and the regulations
            promulgated thereunder regarding "performance-based" compensation.

      (b)   To the extent applicable, it is intended that the PolyOne SEAIP, and
            any grants of restricted shares or share equivalent units referenced
            in Section 8, comply with the provisions of Section 409A of the
            Code. The PolyOne SEAIP, and the agreements relating to any grants
            of restricted shares or share equivalent units referenced in Section
            8, shall be administered in a manner consistent with this intent,
            and any provision that would cause the PolyOne SEAIP or such
            agreements to fail to satisfy Section 409A of the Code shall have no
            force or effect until amended to comply with Section 409A of the
            Code (which amendment may be retroactive to the extent permitted by
            Section 409A of the Code and may be made by the Company without the
            consent of participants).

      (c)   The PolyOne SEAIP will, subject to shareholder approval at the 2005
            Annual Meeting, be effective for the Plan Year beginning January 1,
            2006, and will remain in effect thereafter until terminated by the
            Committee.

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                                  ATTACHMENT A

                 SENIOR EXECUTIVE POLYONE ANNUAL INCENTIVE PLAN

                        DEFINITION OF "CHANGE IN CONTROL"

      For purposes of the Senior Executive PolyOne Annual Incentive Plan,
"Change in 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 paragraph (i), the following
      acquisitions shall not be deemed to result in a Change of Control: (A) any
      acquisition directly from the Company, (B) any acquisition by the Company,
      (C) any acquisition by any employee benefit plan (or related trust)
      sponsored or maintained by the Company or any corporation controlled by
      the Company or (D) any acquisition by any corporation pursuant to a
      transaction that complies with clauses (A), (B) and (C) of sub-paragraph
      (iii) 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 (A) or (B) above, and such
      Person subsequently acquires beneficial ownership of additional voting
      securities of the Company, such 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 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 the date hereof, 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 the date hereof 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

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      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 (A) 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 common
      shares 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,
      (B) 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 common shares of the corporation resulting from such
      Business Combination or the combined voting power of the then outstanding
      voting securities of such corporation except to the extent that such
      ownership existed prior to the Business Combination and (C) 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.

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                                                                    EXHIBIT 10.2

                               POLYONE CORPORATION

                   2005 EQUITY AND PERFORMANCE INCENTIVE PLAN

1.          PURPOSE. The purpose of the 2005 Equity and Performance Incentive
      Plan is to attract and retain directors, officers and other employees of
      PolyOne Corporation, an Ohio corporation, and its Subsidiaries and to
      provide to such persons incentives and rewards for superior performance.

2.          DEFINITIONS. As used in this Plan,

      (a)         "Appreciation Right" means a right granted pursuant to Section
            5 or Section 9 of this Plan, and will include both Tandem
            Appreciation Rights and Free-Standing Appreciation Rights.

      (b)         "Base Price" means the price to be used as the basis for
            determining the Spread upon the exercise of a Free-Standing
            Appreciation Right and a Tandem Appreciation Right.

      (c)         "Board" means the Board of Directors of the Company and, to
            the extent of any delegation by the Board to a committee (or
            subcommittee thereof) pursuant to Section 16 of this Plan, such
            committee (or subcommittee).

      (d)         "Code" means the Internal Revenue Code of 1986, as amended
            from time to time.

      (e)         "Common Shares" means the shares of common stock, par value
            $0.01 per share, of the Company or any security into which such
            Common Shares may be changed by reason of any transaction or event
            of the type referred to in Section 12 of this Plan.

      (f)         "Company" means PolyOne Corporation, an Ohio corporation.

      (g)         "Covered Employee" means a Participant who is, or is
            determined by the Board to be likely to become, a "covered employee"
            within the meaning of Section 162(m) of the Code (or any successor
            provision).

      (h)         "Date of Grant" means the date specified by the Board on which
            a grant of Option Rights, Appreciation Rights, Performance Shares,
            Performance Units or other awards contemplated by Section 10 of this
            Plan, or a grant or sale of Restricted Stock, Restricted Stock
            Units, or other awards contemplated by Section 10 of this Plan will
            become effective (which date will not be earlier than the date on
            which the Board takes action with respect thereto).

      (i)         "Detrimental Activity" means:

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            (i)   Engaging in any activity, as an employee, principal, agent, or
                  consultant for another entity that competes with the Company
                  in any actual, researched, or prospective product, service,
                  system, or business activity for which the Participant has had
                  any direct responsibility during the last two years of his or
                  her employment with the Company or a Subsidiary, in any
                  territory in which the Company or a Subsidiary manufactures,
                  sells, markets, services, or installs such product, service,
                  or system, or engages in such business activity.

            (ii)  Soliciting any employee of the Company or a Subsidiary to
                  terminate his or her employment with the Company or a
                  Subsidiary.

            (iii) The disclosure to anyone outside the Company or a Subsidiary,
                  or the use in other than the Company's or a Subsidiary's
                  business, without prior written authorization from the
                  Company, of any confidential, proprietary or trade secret
                  information or material relating to the business of the
                  Company and its Subsidiaries, acquired by the Participant
                  during his or her employment with the Company or its
                  Subsidiaries or while acting as a consultant for the Company
                  or its Subsidiaries thereafter.

            (iv)  The failure or refusal to disclose promptly and to assign to
                  the Company upon request all right, title and interest in any
                  invention or idea, patentable or not, made or conceived by the
                  Participant during employment by the Company and any
                  Subsidiary, relating in any manner to the actual or
                  anticipated business, research or development work of the
                  Company or any Subsidiary or the failure or refusal to do
                  anything reasonably necessary to enable the Company or any
                  Subsidiary to secure a patent where appropriate in the United
                  States and in other countries.

            (v)   Activity that results in Termination for Cause. For the
                  purposes of this Section, "Termination for Cause" shall mean a
                  termination:

                  (A)   due to the Participant's willful and continuous gross
                        neglect of his or her duties for which he or she is
                        employed, or

                  (B)   due to an act of dishonesty on the part of the
                        Participant constituting a felony resulting or intended
                        to result, directly or indirectly, in his or her gain
                        for personal enrichment at the expense of the Company or
                        a Subsidiary.

            (vi)  Any other conduct or act determined to be injurious,
                  detrimental or prejudicial to any significant interest of the
                  Company or any Subsidiary unless the Participant acted in good
                  faith and in a manner he or she reasonably believed to be in
                  or not opposed to the best interests of the Company.

      (j)         "Director" means a member of the Board of Directors of the
            Company.

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      (k)         "Evidence of Award" means an agreement, certificate,
            resolution or other type or form of writing or other evidence
            approved by the Board that sets forth the terms and conditions of
            the awards granted. An Evidence of Award may be in an electronic
            medium, may be limited to notation on the books and records of the
            Company and, with the approval of the Board, need not be signed by a
            representative of the Company or a Participant.

      (l)         "Exchange Act" means the Securities Exchange Act of 1934, as
            amended, and the rules and regulations thereunder, as such law,
            rules and regulations may be amended from time to time.

      (m)         "Free-Standing Appreciation Right" means an Appreciation Right
            granted pursuant to Section 5 or Section 9 of this Plan that is not
            granted in tandem with an Option Right.

      (n)         "Incentive Stock Options" means Option Rights that are
            intended to qualify as "incentive stock options" under Section 422
            of the Code or any successor provision.

      (o)         "Management Objectives" means the measurable performance
            objective or objectives established pursuant to this Plan for
            Participants who have received grants of Performance Shares or
            Performance Units or, when so determined by the Board, Option
            Rights, Appreciation Rights, Restricted Stock, Restricted Stock
            Units, dividend credits and other awards pursuant to this Plan.
            Management Objectives may be described in terms of Company-wide
            objectives or objectives that are related to the performance of the
            individual Participant or of the Subsidiary, division, department,
            region or function within the Company or Subsidiary in which the
            Participant is employed. The Management Objectives may be made
            relative to the performance of other companies. The Management
            Objectives applicable to any award to a Covered Employee will be
            based on specified levels of or growth in one or more of the
            following criteria:

            (i)   PROFITS (e.g., operating income, EBIT, EBT, net income,
                  earnings per share, residual or economic earnings -- these
                  profitability metrics could be measured before special items
                  and/or subject to GAAP definition);

            (ii)  CASH FLOW (e.g., EBITDA, operating cash flow, total cash flow,
                  cash flow in excess of cost of capital or residual cash flow
                  or cash flow return on investment);

            (iii) RETURNS (e.g., profits or cash flow returns on: assets,
                  invested capital, net capital employed, and equity);

            (iv)  WORKING CAPITAL (e.g., working capital divided by sales, days'
                  sales outstanding, days' sales inventory, and days' sales in
                  payables);

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            (v)   PROFIT MARGINS (e.g., profits divided by revenues, gross
                  margins and material margins divided by revenues, and material
                  margin divided by sales pounds);

            (vi)  LIQUIDITY MEASURES (e.g., debt-to-capital, debt-to-EBITDA,
                  total debt ratio);

            (vii) SALES GROWTH, COST INITIATIVE AND STOCK PRICE METRICS (e.g.,
                  revenues, revenue growth, stock price appreciation, total
                  return to shareholders, sales and administrative costs divided
                  by sales, and sales and administrative costs divided by
                  profits); and

            (viii) STRATEGIC INITIATIVE KEY DELIVERABLE METRICS consisting of
                  one or more of the following: product development, strategic
                  partnering, research and development, market penetration,
                  geographic business expansion goals, cost targets, customer
                  satisfaction, employee satisfaction, management of employment
                  practices and employee benefits, supervision of litigation and
                  information technology, and goals relating to acquisitions or
                  divestitures of subsidiaries, affiliates and joint ventures.

            If the Board determines that a change in the business, operations,
corporate structure or capital structure of the Company, or the manner in which
it conducts its business, or other events or circumstances render the Management
Objectives unsuitable, the Board may in its discretion modify such Management
Objectives or the related minimum acceptable level of achievement, in whole or
in part, as the Board deems appropriate and equitable, except in the case of a
Covered Employee where such action would result in the loss of the otherwise
available exemption of the award under Section 162(m) of the Code. In such case,
the Board will not make any modification of the Management Objectives or minimum
acceptable level of achievement with respect to such Covered Employee.

      (p)         "Market Value per Share" means, as of any particular date, the
            fair market value of the Common Shares as determined by the Board.

      (q)         "Non-Employee Director" means a person who is a "non-employee
            director" of the Company within the meaning of Rule 16b-3 of the
            Securities and Exchange Commission promulgated under the Exchange
            Act.

      (r)         "Optionee" means the optionee named in an Evidence of Award
            evidencing an outstanding Option Right.

      (s)         "Option Price" means the purchase price payable on exercise of
            an Option Right.

      (t)         "Option Right" means the right to purchase Common Shares upon
            exercise of an option granted pursuant to Section 4 or Section 9 of
            this Plan.

      (u)         "Participant" means a person who is selected by the Board to
            receive benefits under this Plan and who is at the time an officer,
            or other key employee

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            of the Company or any one or more of its Subsidiaries, or who has
            agreed to commence serving in any of such capacities within 90 days
            of the Date of Grant, and will also include each Non-Employee
            Director who receives Common Shares or an award of Option Rights,
            Appreciation Rights, Restricted Stock, Restricted Stock Units or
            other awards under this Plan. The term "Participant" shall also
            include any person who provides services to the Company or a
            Subsidiary that are equivalent to those typically provided by an
            employee.

      (v)         "Performance Period" means, in respect of a Performance Share
            or Performance Unit, a period of time established pursuant to
            Section 8 of this Plan within which the Management Objectives
            relating to such Performance Share or Performance Unit are to be
            achieved.

      (w)         "Performance Share" means a bookkeeping entry that records the
            equivalent of one Common Share awarded pursuant to Section 8 of this
            Plan.

      (x)         "Performance Unit" means a bookkeeping entry awarded pursuant
            to Section 8 of this Plan that records a unit equivalent to $1.00 or
            such other value as is determined by the Board.

      (y)         "Plan" means this PolyOne Corporation 2005 Equity and
            Performance Incentive Plan.

      (z)         "Restricted Stock" means Common Shares granted or sold
            pursuant to Section 6 or Section 9 of this Plan as to which neither
            the substantial risk of forfeiture nor the prohibition on transfers
            has expired.

      (aa)        "Restriction Period" means the period of time during which
            Restricted Stock Units are subject to restrictions, as provided in
            Section 7 or Section 9 of this Plan.

      (bb)        "Restricted Stock Unit" means an award made pursuant to
            Section 7 or Section 9 of this Plan of the right to receive Common
            Shares or cash at the end of a specified period.

      (cc)        "Spread" means the excess of the Market Value per Share on the
            date when an Appreciation Right is exercised, or on the date when
            Option Rights are surrendered in payment of the Option Price of
            other Option Rights, over the Option Price or Base Price provided
            for in the related Option Right or Free-Standing Appreciation Right,
            respectively.

      (dd)        "Subsidiary" means a corporation, company or other entity (i)
            more than 50 percent of whose outstanding shares or securities
            (representing the right to vote for the election of directors or
            other managing authority) are, or (ii) which does not have
            outstanding shares or securities (as may be the case in a
            partnership, joint venture or unincorporated association), but more
            than 50 percent of whose ownership interest representing the right
            generally to make decisions for such other entity is, now or
            hereafter, owned or controlled, directly or indirectly, by the

                                       5
<PAGE>

            Company except that for purposes of determining whether any person
            may be a Participant for purposes of any grant of Incentive Stock
            Options, "Subsidiary" means any corporation in which at the time the
            Company owns or controls, directly or indirectly, more than 50
            percent of the total combined voting power represented by all
            classes of stock issued by such corporation.

      (ee)        "Tandem Appreciation Right" means an Appreciation Right
            granted pursuant to Section 5 or Section 9 of this Plan that is
            granted in tandem with an Option Right.

3.          SHARES AVAILABLE UNDER THE PLAN.

      (a)         Subject to adjustment as provided in Section 12 of this Plan,
            the number of Common Shares that may be issued or transferred (i)
            upon the exercise of Option Rights or Appreciation Rights, (ii) as
            Restricted Stock and released from substantial risks of forfeiture
            thereof, (iii) as Restricted Stock Units, (iv) in payment of
            Performance Shares or Performance Units that have been earned, (v)
            as awards to Non-Employee Directors, (vi) as awards contemplated by
            Section 10 of this Plan, or (vii) in payment of dividend equivalents
            paid with respect to awards made under the Plan will not exceed in
            the aggregate 5,000,000 Common Shares, plus any shares relating to
            awards that expire or are forfeited or are cancelled. Common Shares
            covered by an award granted under the Plan shall not be counted as
            used unless and until they are actually issued and delivered to a
            Participant. Without limiting the generality of the foregoing, upon
            payment in cash of the benefit provided by any award granted under
            the Plan, any Common Shares that were covered by that award will be
            available for issue or transfer hereunder. Notwithstanding anything
            to the contrary contained herein: (A) shares tendered in payment of
            the Option Price of a Option Right shall not be added to the
            aggregate plan limit described above; (B) shares withheld by the
            Company to satisfy the tax withholding obligation shall not be added
            to the aggregate plan limit described above; (C) shares that are
            repurchased by the Company with Option Right proceeds shall not be
            added to the aggregate plan limit described above; and (D) all
            shares covered by an Appreciation Right, to the extent that it is
            exercised and settled in Common Shares, and whether or not shares
            are actually issued to the participant upon exercise of the right,
            shall be considered issued or transferred pursuant to the Plan. Such
            shares may be shares of original issuance or treasury shares or a
            combination of the foregoing.

      (b)         If, under this Plan, a Participant has elected to give up the
            right to receive compensation in exchange for Common Shares based on
            fair market value, such Common Shares will not count against the
            number of shares available in Section 3(a) above.

      (c)         Notwithstanding anything in this Section 3, or elsewhere in
            this Plan, to the contrary and subject to adjustment as provided in
            Section 12 of this Plan: (i) the aggregate number of Common Shares
            actually issued or transferred by the Company upon the exercise of
            Incentive Stock Options will not exceed 3,000,000

                                       6
<PAGE>

            Common Shares; (ii) no Participant will be granted Option Rights or
            Appreciation Rights, in the aggregate, for more than 500,000 Common
            Shares during any calendar year; (iii) no Participant will be
            granted Restricted Stock or Restricted Stock Units that specify
            Management Objectives, Performance Shares or other awards under
            Section 10 of this Plan, in the aggregate, for more than 400,000
            Common Shares during any calendar year; and (iv) the number of
            shares issued as Restricted Stock, Restricted Stock Units,
            Performance Shares and Performance Units and other awards under
            Section 10 of this Plan (after taking into account any forfeitures
            and cancellations) will not during the life of the Plan in the
            aggregate exceed 1,500,000 Common Shares.

      (d)         Notwithstanding any other provision of this Plan to the
            contrary, in no event will any Participant in any calendar year
            receive an award of Performance Units having an aggregate maximum
            value as of their respective Dates of Grant in excess of $3,000,000.

4.          OPTION RIGHTS. The Board may, from time to time and upon such terms
      and conditions as it may determine, authorize the granting to Participants
      of options to purchase Common Shares. Each such grant may utilize any or
      all of the authorizations, and will be subject to all of the requirements
      contained in the following provisions:

      (a)         Each grant will specify the number of Common Shares to which
            it pertains subject to the limitations set forth in Section 3 of
            this Plan.

      (b)         Each grant will specify an Option Price per share, which may
            not be less than the Market Value per Share on the day immediately
            preceding the Date of Grant.

      (c)         Each grant will specify whether the Option Price will be
            payable (i) in cash or by check acceptable to the Company or by wire
            transfer of immediately available funds, (ii) by the actual or
            constructive transfer to the Company of Common Shares owned by the
            Optionee for at least 6 months (or other consideration authorized
            pursuant to Section 4(d)) having a value at the time of exercise
            equal to the total Option Price, (iii) by a combination of such
            methods of payment, or (iv) by such other methods as may be approved
            by the Board.

      (d)         To the extent permitted by law, any grant may provide for
            deferred payment of the Option Price from the proceeds of sale
            through a bank or broker on a date satisfactory to the Company of
            some or all of the shares to which such exercise relates.

      (e)         Successive grants may be made to the same Participant whether
            or not any Option Rights previously granted to such Participant
            remain unexercised.

      (f)         Each grant will specify the period or periods of continuous
            service by the Optionee with the Company or any Subsidiary that is
            necessary before the Option Rights or installments thereof will
            become exercisable; provided, however, that Option Rights may not
            become exercisable by the passage of time sooner than

                                       7
<PAGE>

            one-third per year over three years. A grant of Option Rights may
            provide for the earlier exercise of such Option Rights in the event
            of a change of control, as may be defined in an Evidence of Award.

      (g)         Any grant of Option Rights may specify Management Objectives
            that must be achieved as a condition to the exercise of such rights;
            provided, however, that Option Rights that become exercisable upon
            the achievement of Management Objectives may not become exercisable
            sooner than one year from the Date of Grant.

      (h)         Option Rights granted under this Plan may be (i) options,
            including, without limitation, Incentive Stock Options, that are
            intended to qualify under particular provisions of the Code, (ii)
            options that are not intended so to qualify, or (iii) combinations
            of the foregoing. Incentive Stock Options may only be granted to
            Participants who meet the definition of "employees" under Section
            3401(c) of the Code.

      (i)         The Board may at the Date of Grant of any Option Rights (other
            than Incentive Stock Options), provide for the payment of dividend
            equivalents to the Optionee on either a current or deferred or
            contingent basis, either in cash or in additional Common Shares.

      (j)         The exercise of an Option Right will result in the
            cancellation on a share- for-share basis of any Tandem Appreciation
            Right authorized under Section 5 of this Plan.

      (k)         No Option Right will be exercisable more than 10 years from
            the Date of Grant.

      (l)         The Board reserves the discretion at or after the Date of
            Grant to provide for (i) the payment of a cash bonus at the time of
            exercise; (ii) the availability of a loan at exercise; and (iii) the
            right to tender in satisfaction of the Option Price nonforfeitable,
            unrestricted Common Shares, which are already owned by the Optionee
            and have a value at the time of exercise that is equal to the Option
            Price.

      (m)         The Board may substitute, without receiving Participant
            permission, Appreciation Rights paid only in Common Shares (or
            Appreciation Rights paid in Common Shares or cash at the Board's
            discretion) for outstanding Options; provided, however, that the
            terms of the substituted Appreciation Rights are the same as the
            terms for the Options and the difference between the Market Value
            Per Share of the underlying Common Shares and the Base Price of the
            Appreciation Rights is equivalent to the difference between the
            Market Value Per Share of the underlying Common Shares and the
            Option Price of the Options. If, in the opinion of the Company's
            auditors, this provision creates adverse accounting consequences for
            the Company, it shall be considered null and void.

                                       8
<PAGE>

      (n)         Each grant of Option Rights will be evidenced by an Evidence
            of Award. Each Evidence of Award shall be subject to the Plan and
            shall contain such terms and provisions as the Board may approve.

5.          APPRECIATION RIGHTS.

      (a)         The Board may authorize the granting (i) to any Optionee, of
            Tandem Appreciation Rights in respect of Option Rights granted
            hereunder, and (ii) to any Participant, of Free-Standing
            Appreciation Rights. A Tandem Appreciation Right will be a right of
            the Optionee, exercisable by surrender of the related Option Right,
            to receive from the Company an amount determined by the Board, which
            will be expressed as a percentage of the Spread (not exceeding 100
            percent) at the time of exercise. Tandem Appreciation Rights may be
            granted at any time prior to the exercise or termination of the
            related Option Rights; provided, however, that a Tandem Appreciation
            Right awarded in relation to an Incentive Stock Option must be
            granted concurrently with such Incentive Stock Option. A
            Free-Standing Appreciation Right will be a right of the Participant
            to receive from the Company an amount determined by the Board, which
            will be expressed as a percentage of the Spread (not exceeding 100
            percent) at the time of exercise.

      (b)         Each grant of Appreciation Rights may utilize any or all of
            the authorizations, and will be subject to all of the requirements,
            contained in the following provisions:

            (i)   Any grant may specify that the amount payable on exercise of
                  an Appreciation Right may be paid by the Company in cash, in
                  Common Shares or in any combination thereof and may either
                  grant to the Participant or retain in the Board the right to
                  elect among those alternatives.

            (ii)  Any grant may specify that the amount payable on exercise of
                  an Appreciation Right may not exceed a maximum specified by
                  the Board at the Date of Grant.

            (iii) Any grant may specify waiting periods before exercise and
                  permissible exercise dates or periods; provided, however, that
                  Appreciation Rights may not become exercisable by the passage
                  of time sooner than one-third per year over three years.

            (iv)  Any grant may specify that such Appreciation Right may be
                  exercised only in the event of, or earlier in the event of, a
                  change of control, as may be defined in an Evidence of Award.

            (v)   Any grant may provide for the payment to the Participant of
                  dividend equivalents thereon in cash or Common Shares on a
                  current, deferred or contingent basis.

                                       9
<PAGE>

            (vi)  Any grant of Appreciation Rights may specify Management
                  Objectives that must be achieved as a condition of the
                  exercise of such Appreciation Rights; provided, however, that
                  Option Rights that become exercisable upon the achievement of
                  Management Objectives may not become exercisable sooner than
                  one year from the Date of Grant.

            (vii) Each grant of Appreciation Rights will be evidenced by an
                  Evidence of Award, which Evidence of Award will describe such
                  Appreciation Rights, identify the related Option Rights (if
                  applicable), and contain such other terms and provisions,
                  consistent with this Plan, as the Board may approve.

      (c)         Any grant of Tandem Appreciation Rights will provide that such
            Tandem Appreciation Rights may be exercised only at a time when the
            related Option Right is also exercisable and at a time when the
            Spread is positive, and by surrender of the related Option Right for
            cancellation.

      (d)         Regarding Free-Standing Appreciation Rights only:

            (i)   Each grant will specify in respect of each Free-Standing
                  Appreciation Right a Base Price, which will be equal to or
                  greater than the Market Value per Share on the day immediately
                  preceding the Date of Grant;

            (ii)  Successive grants may be made to the same Participant
                  regardless of whether any Free-Standing Appreciation Rights
                  previously granted to the Participant remain unexercised; and

            (iii) No Free-Standing Appreciation Right granted under this Plan
                  may be exercised more than 10 years from the Date of Grant.

6.          RESTRICTED STOCK. The Board may also authorize the grant or sale of
      Restricted Stock to Participants. Each such grant or sale may utilize any
      or all of the authorizations, and will be subject to all of the
      requirements, contained in the following provisions:

      (a)         Each such grant or sale will constitute an immediate transfer
            of the ownership of Common Shares to the Participant in
            consideration of the performance of services, entitling such
            Participant to voting, dividend and other ownership rights, but
            subject to the substantial risk of forfeiture and restrictions on
            transfer hereinafter referred to.

      (b)         Each such grant or sale may be made without additional
            consideration or in consideration of a payment by such Participant
            that is less than the Market Value per Share at the Date of Grant.

      (c)         Each such grant or sale will provide that the Restricted Stock
            covered by such grant or sale that vests upon the passage of time
            will be subject to a "substantial risk of forfeiture" within the
            meaning of Section 83 of the Code for a period of not less than
            three years to be determined by the Board at the Date of

                                       10
<PAGE>

            Grant and may provide for the earlier lapse of such substantial risk
            of forfeiture in the event of a change of control, as may be defined
            in an Evidence of Award.

      (d)         Each such grant or sale will provide that during the period
            for which such substantial risk of forfeiture is to continue, the
            transferability of the Restricted Stock will be prohibited or
            restricted in the manner and to the extent prescribed by the Board
            at the Date of Grant (which restrictions may include, without
            limitation, rights of repurchase or first refusal in the Company or
            provisions subjecting the Restricted Stock to a continuing
            substantial risk of forfeiture in the hands of any transferee).

      (e)         Any grant of Restricted Stock may specify Management
            Objectives that, if achieved, will result in termination or early
            termination of the restrictions applicable to such Restricted Stock;
            provided, however, that restrictions relating to Restricted Stock
            that vests upon the achievement of Management Objectives may not
            terminate sooner than one year from the Date of Grant. Each grant
            may specify in respect of such Management Objectives a minimum
            acceptable level of achievement and may set forth a formula for
            determining the number of shares of Restricted Stock on which
            restrictions will terminate if performance is at or above the
            minimum level, but falls short of full achievement of the specified
            Management Objectives.

      (f)         Any such grant or sale of Restricted Stock may require that
            any or all dividends or other distributions paid thereon during the
            period of such restrictions be automatically deferred and reinvested
            in additional shares of Restricted Stock, which may be subject to
            the same restrictions as the underlying award.

      (g)         Each grant or sale of Restricted Stock will be evidenced by an
            Evidence of Award and will contain such terms and provisions,
            consistent with this Plan, as the Board may approve. Unless
            otherwise directed by the Board, all certificates representing
            shares of Restricted Stock will be held in custody by the Company
            until all restrictions thereon will have lapsed, together with a
            stock power or powers executed by the Participant in whose name such
            certificates are registered, endorsed in blank and covering such
            Shares.

7.          RESTRICTED STOCK UNITS. The Board may also authorize the granting or
      sale of Restricted Stock Units to Participants. Each such grant or sale
      may utilize any or all of the authorizations, and will be subject to all
      of the requirements contained in the following provisions:

      (a)         Each such grant or sale will constitute the agreement by the
            Company to deliver Common Shares or cash to the Participant in the
            future in consideration of the performance of services, but subject
            to the fulfillment of such conditions (which may include the
            achievement of Management Objectives) during the Restriction Period
            as the Board may specify. If a grant of Restricted Stock Units
            specifies that the Restriction Period will terminate only upon the
            achievement of Management Objectives, such Restriction Period may
            not terminate sooner than

                                       11
<PAGE>

            one year from the Date of Grant. Each grant may specify in respect
            of such Management Objectives a minimum acceptable level of
            achievement and may set forth a formula for determining the number
            of shares of Restricted Stock on which restrictions will terminate
            if performance is at or above the minimum level, but falls short of
            full achievement of the specified Management Objectives.

      (b)         Each such grant or sale may be made without additional
            consideration or in consideration of a payment by such Participant
            that is less than the Market Value per Share at the Date of Grant.

      (c)         If the Restriction Period lapses by the passage of time, each
            such grant or sale will be subject to a Restriction Period of not
            less than three years, as determined by the Board at the Date of
            Grant, and may provide for the earlier lapse or other modification
            of such Restriction Period in the event of a change of control, as
            may be defined in an Evidence of Award.

      (d)         During the Restriction Period, the Participant will have no
            right to transfer any rights under his or her award and will have no
            rights of ownership in the Restricted Stock Units and will have no
            right to vote them, but the Board may at the Date of Grant,
            authorize the payment of dividend equivalents on such Restricted
            Stock Units on either a current or deferred or contingent basis,
            either in cash or in additional Common Shares.

      (e)         Each grant or sale of Restricted Stock Units will be evidenced
            by an Evidence of Award and will contain such terms and provisions,
            consistent with this Plan, as the Board may approve.

8.          PERFORMANCE SHARES AND PERFORMANCE UNITS. The Board may also
      authorize the granting of Performance Shares and Performance Units that
      will become payable to a Participant upon achievement of specified
      Management Objectives during the Performance Period. Each such grant may
      utilize any or all of the authorizations, and will be subject to all of
      the requirements, contained in the following provisions:

      (a)         Each grant will specify the number of Performance Shares or
            Performance Units to which it pertains, which number may be subject
            to adjustment to reflect changes in compensation or other factors;
            provided, however, that no such adjustment will be made in the case
            of a Covered Employee where such action would result in the loss of
            the otherwise available exemption of the award under Section 162(m)
            of the Code.

      (b)         The Performance Period with respect to each Performance Share
            or Performance Unit will be such period of time (not less than three
            years), commencing with the Date of Grant as will be determined by
            the Board at the time of grant which may be subject to earlier lapse
            or other modification in the event of a change of control, as may be
            defined in an Evidence of Award.

      (c)         Any grant of Performance Shares or Performance Units will
            specify Management Objectives which, if achieved, will result in
            payment or early

                                       12
<PAGE>

            payment of the award, and each grant may specify in respect of such
            specified Management Objectives a minimum acceptable level of
            achievement and will set forth a formula for determining the number
            of Performance Shares or Performance Units that will be earned if
            performance is at or above the minimum level, but falls short of
            full achievement of the specified Management Objectives. The grant
            of Performance Shares or Performance Units will specify that, before
            the Performance Shares or Performance Units will be earned and paid,
            the Board must certify that the Management Objectives have been
            satisfied.

      (d)         Each grant will specify the time and manner of payment of
            Performance Shares or Performance Units that have been earned. Any
            grant may specify that the amount payable with respect thereto may
            be paid by the Company in cash, in Common Shares or in any
            combination thereof and may either grant to the Participant or
            retain in the Board the right to elect among those alternatives.

      (e)         Any grant of Performance Shares may specify that the amount
            payable with respect thereto may not exceed a maximum specified by
            the Board at the Date of Grant. Any grant of Performance Units may
            specify that the amount payable or the number of Common Shares
            issued with respect thereto may not exceed maximums specified by the
            Board at the Date of Grant.

      (f)         The Board may at the Date of Grant of Performance Shares,
            provide for the payment of dividend equivalents to the holder
            thereof on either a current or deferred or contingent basis, either
            in cash or in additional Common Shares.

      (g)         Each grant of Performance Shares or Performance Units will be
            evidenced by an Evidence of Award and will contain such other terms
            and provisions, consistent with this Plan, as the Board may approve.

9.          AWARDS TO NON-EMPLOYEE DIRECTORS. The Board may, from time to time
      and upon such terms and conditions as it may determine, authorize the
      granting to Non-Employee Directors Option Rights, Appreciation Rights or
      other awards contemplated by Section 10 of this Plan and may also
      authorize the grant or sale of Common Shares, Restricted Stock or
      Restricted Stock Units to Non-Employee Directors.

      (a)         Each grant of Option Rights awarded pursuant to this Section 9
            will be upon terms and conditions consistent with Section 4 of this
            Plan and will be evidenced by an Evidence of Award in such form as
            will be approved by the Board. Each grant will specify an Option
            Price per share, which will not be less than the Market Value per
            Share on the day immediately preceding the Date of Grant. Each such
            Option Right granted under the Plan will expire not more than 10
            years from the Date of Grant and will be subject to earlier
            termination as hereinafter provided. Unless otherwise determined by
            the Board, such Option Rights will be subject to the following
            additional terms and conditions:

            (i)   Each grant will specify the number of Common Shares to which
                  it pertains subject to the limitations set forth in Section 3
                  of this Plan.

                                       13
<PAGE>

            (ii)  If a Non-Employee Director subsequently becomes an employee of
                  the Company or a Subsidiary while remaining a member of the
                  Board, any Option Rights held under the Plan by such
                  individual at the time of such commencement of employment will
                  not be affected thereby.

            (iii) Option Rights may be exercised by a Non-Employee Director only
                  upon payment to the Company in full of the Option Price of the
                  Common Shares to be delivered. Such payment will be made in
                  cash or in Common Shares then owned by the optionee for at
                  least six months, or in a combination of cash and such Common
                  Shares.

      (b)         Non-Employee Directors, pursuant to this Section 9, may be
            awarded, or may be permitted to elect to receive, pursuant to
            procedures established by the Board, all or any portion of their
            annual retainer, meeting fees or other fees in Common Shares in lieu
            of cash.

      (c)         Each grant or sale of Appreciation Rights pursuant to this
            Section 9 will be upon terms and conditions consistent with Section
            5 of this Plan.

      (d)         Each grant or sale of Restricted Stock pursuant to this
            Section 9 will be upon terms and conditions consistent with Section
            6 of this Plan.

      (e)         Each grant or sale of Restricted Stock Units pursuant to this
            Section 9 will be upon terms and conditions consistent with Section
            7 of this Plan.

      (f)         Non-Employee Directors may be granted, sold, or awarded other
            awards as contemplated by Section 10 of this Plan.

10.         OTHER AWARDS.

      (a)         The Board may, subject to limitations under applicable law,
            grant to any Participant such other awards that may be denominated
            or payable in, valued in whole or in part by reference to, or
            otherwise based on, or related to, Common Shares or factors that may
            influence the value of such shares, including, without limitation,
            convertible or exchangeable debt securities, other rights
            convertible or exchangeable into Common Shares, purchase rights for
            Common Shares, awards with value and payment contingent upon
            performance of the Company or specified Subsidiaries, affiliates or
            other business units thereof or any other factors designated by the
            Board, and awards valued by reference to the book value of Common
            Shares or the value of securities of, or the performance of
            specified Subsidiaries or affiliates or other business units of the
            Company. The Board shall determine the terms and conditions of such
            awards. Common Shares delivered pursuant to an award in the nature
            of a purchase right granted under this Section 10 shall be purchased
            for such consideration, paid for at such time, by such methods, and
            in such forms, including, without limitation, cash, Common Shares,
            other awards, notes or other property, as the Board shall determine.

                                       14
<PAGE>

      (b)         Cash awards, as an element of or supplement to any other award
            granted under this Plan, may also be granted pursuant to this
            Section 10 of this Plan.

      (c)         The Board may grant Common Shares as a bonus, or may grant
            other awards in lieu of obligations of the Company or a Subsidiary
            to pay cash or deliver other property under this Plan or under other
            plans or compensatory arrangements, subject to such terms as shall
            be determined by the Board.

11.         TRANSFERABILITY.

      (a)         Except as otherwise determined by the Board, no Option Right,
            Appreciation Right or other derivative security granted under the
            Plan shall be transferable by the Participant except by will or the
            laws of descent and distribution. Except as otherwise determined by
            the Board, Option Rights and Appreciation Rights will be exercisable
            during the Participant's lifetime only by him or her or, in the
            event of the Participant's legal incapacity to do so, by his or her
            guardian or legal representative acting on behalf of the Participant
            in a fiduciary capacity under state law and/or court supervision.

      (b)         The Board may specify at the Date of Grant that part or all of
            the Common Shares that are (i) to be issued or transferred by the
            Company upon the exercise of Option Rights or Appreciation Rights,
            upon the termination of the Restriction Period applicable to
            Restricted Stock Units or upon payment under any grant of
            Performance Shares or Performance Units or (ii) no longer subject to
            the substantial risk of forfeiture and restrictions on transfer
            referred to in Section 6 of this Plan, will be subject to further
            restrictions on transfer.

12.         ADJUSTMENTS. The Board may make or provide for such adjustments in
      the numbers of Common Shares covered by outstanding Option Rights,
      Appreciation Rights, Restricted Stock Units, Performance Shares and
      Performance Units granted hereunder and, if applicable, in the number of
      Common Shares covered by other awards granted pursuant to Section 10
      hereof, in the Option Price and Base Price provided in outstanding
      Appreciation Rights, and in the kind of shares covered thereby, as the
      Board, in its sole discretion, exercised in good faith, may determine is
      equitably required to prevent dilution or enlargement of the rights of
      Participants or Optionees that otherwise would result from (a) any stock
      dividend, stock split, combination of shares, recapitalization or other
      change in the capital structure of the Company, or (b) any merger,
      consolidation, spin-off, split- off, spin-out, split-up, reorganization,
      partial or complete liquidation or other distribution of assets, issuance
      of rights or warrants to purchase securities, or (c) any other corporate
      transaction or event having an effect similar to any of the foregoing.
      Moreover, in the event of any such transaction or event, the Board, in its
      discretion, may provide in substitution for any or all outstanding awards
      under this Plan such alternative consideration (including cash), if any,
      as it, in good faith, may determine to be equitable in the circumstances
      and may require in connection therewith the surrender of all awards so
      replaced. The Board may also make or provide for such adjustments in the
      numbers of shares specified in Section 3 of this Plan as the Board in its
      sole discretion, exercised in good faith, may determine is appropriate to
      reflect any transaction or event described in

                                       15
<PAGE>

      this Section 12; provided, however, that any such adjustment to the number
      specified in Section 3(c)(i) will be made only if and to the extent that
      such adjustment would not cause any option intended to qualify as an
      Incentive Stock Option to fail so to qualify.

13.         FRACTIONAL SHARES. The Company will not be required to issue any
      fractional Common Shares pursuant to this Plan. The Board may provide for
      the elimination of fractions or for the settlement of fractions in cash.

14.         WITHHOLDING TAXES. To the extent that the Company is required to
      withhold federal, state, local or foreign taxes in connection with any
      payment made or benefit realized by a Participant or other person under
      this Plan, and the amounts available to the Company for such withholding
      are insufficient, it will be a condition to the receipt of such payment or
      the realization of such benefit that the Participant or such other person
      make arrangements satisfactory to the Company for payment of the balance
      of such taxes required to be withheld, which arrangements (in the
      discretion of the Board) may include relinquishment of a portion of such
      benefit.

15.         FOREIGN EMPLOYEES. In order to facilitate the making of any grant or
      combination of grants under this Plan, the Board may provide for such
      special terms for awards to Participants who are foreign nationals or who
      are employed by the Company or any Subsidiary outside of the United States
      of America or who provide services to the Company under an agreement with
      a foreign nation or agency, as the Board may consider necessary or
      appropriate to accommodate differences in local law, tax policy or custom.
      Moreover, the Board may approve such supplements to or amendments,
      restatements or alternative versions of this Plan as it may consider
      necessary or appropriate for such purposes, without thereby affecting the
      terms of this Plan as in effect for any other purpose, and the Secretary
      or other appropriate officer of the Company may certify any such document
      as having been approved and adopted in the same manner as this Plan. No
      such special terms, supplements, amendments or restatements, however, will
      include any provisions that are inconsistent with the terms of this Plan
      as then in effect unless this Plan could have been amended to eliminate
      such inconsistency without further approval by the shareholders of the
      Company.

16.         ADMINISTRATION OF THE PLAN.

      (a)         This Plan will be administered by the Board, which may from
            time to time delegate all or any part of its authority under this
            Plan to the Compensation and Governance Committee of the Board (or a
            subcommittee thereof), as constituted from time to time. To the
            extent of any such delegation, references in this Plan to the Board
            will be deemed to be references to such committee or subcommittee. A
            majority of the committee (or subcommittee) will constitute a
            quorum, and the action of the members of the committee (or
            subcommittee) present at any meeting at which a quorum is present,
            or acts unanimously approved in writing, will be the acts of the
            committee (or subcommittee).

      (b)         The interpretation and construction by the Board of any
            provision of this Plan or of any agreement, notification or document
            evidencing the grant of Option

                                       16
<PAGE>

            Rights, Appreciation Rights, Restricted Stock, Restricted Stock
            Units, Performance Shares, Performance Units or other awards
            pursuant to Section 10 of this Plan and any determination by the
            Board pursuant to any provision of this Plan or of any such
            agreement, notification or document will be final and conclusive. No
            member of the Board will be liable for any such action or
            determination made in good faith.

      (c)         The Board or, to the extent of any delegation as provided in
            Section 16(a), the committee, may delegate to one or more of its
            members or to one or more officers of the Company, or to one or more
            agents or advisors, such administrative duties or powers as it may
            deem advisable, and the Board, the committee, or any person to whom
            duties or powers have been delegated as aforesaid, may employ one or
            more persons to render advice with respect to any responsibility the
            Board, the committee or such person may have under the Plan. The
            Board or the committee may, by resolution, authorize one or more
            officers of the Company to do one or both of the following on the
            same basis as the Board or the committee: (i) designate employees to
            be recipients of awards under this Plan; (ii) determine the size of
            any such awards; provided, however, that (A) the Board or the
            Committee shall not delegate such responsibilities to any such
            officer for awards granted to an employee who is an officer,
            Director, or more than 10% beneficial owner of any class of the
            Company's equity securities that is registered pursuant to Section
            12 of the Exchange Act, as determined by the Board in accordance
            with Section 16 of the Exchange Act; (B) the resolution providing
            for such authorization sets forth the total number of Common Shares
            such officer(s) may grant; and (iii) the officer(s) shall report
            periodically to the Board or the committee, as the case may be,
            regarding the nature and scope of the awards granted pursuant to the
            authority delegated.

17.         AMENDMENTS, ETC.

      (a)         The Board may at any time and from time to time amend the Plan
            in whole or in part; provided, however, that any amendment which
            must be approved by the shareholders of the Company in order to
            comply with applicable law or the rules of the New York Stock
            Exchange or, if the Common Shares are not traded on the New York
            Stock Exchange, the principal national securities exchange upon
            which the Common Shares are traded or quoted, will not be effective
            unless and until such approval has been obtained.

      (b)         The Board will not, without the further approval of the
            shareholders of the Company, authorize the amendment of any
            outstanding Option Right to reduce the Option Price. Furthermore, no
            Option Right will be cancelled and replaced with awards having a
            lower Option Price without further approval of the shareholders of
            the Company. This Section 17(b) is intended to prohibit the
            repricing of "underwater" Option Rights and will not be construed to
            prohibit the adjustments provided for in Section 12 of this Plan.

                                       17
<PAGE>

      (c)         The Board may condition the grant of any award or combination
            of awards authorized under this Plan on the surrender or deferral by
            the Participant of his or her right to receive a cash bonus or other
            compensation otherwise payable by the Company or a Subsidiary to the
            Participant.

      (d)         If permitted by Section 409A of the Code, in case of
            termination of employment by reason of death, disability or normal
            or early retirement, or in the case of unforeseeable emergency or
            other special circumstances, of a Participant who holds an Option
            Right or Appreciation Right not immediately exercisable in full, or
            any shares of Restricted Stock as to which the substantial risk of
            forfeiture or the prohibition or restriction on transfer has not
            lapsed, or any Restricted Stock Units as to which the Restriction
            Period has not been completed, or any Performance Shares or
            Performance Units which have not been fully earned, or any other
            awards made pursuant to Section 10 subject to any vesting schedule
            or transfer restriction, or who holds Common Shares subject to any
            transfer restriction imposed pursuant to Section 11(b) of this Plan,
            the Board may, in its sole discretion, accelerate the time at which
            such Option Right, Appreciation Right or other award may be
            exercised or the time at which such substantial risk of forfeiture
            or prohibition or restriction on transfer will lapse or the time
            when such Restriction Period will end or the time at which such
            Performance Shares or Performance Units will be deemed to have been
            fully earned or the time when such transfer restriction will
            terminate or may waive any other limitation or requirement under any
            such award.

      (e)         This Plan will not confer upon any Participant any right with
            respect to continuance of employment or other service with the
            Company or any Subsidiary, nor will it interfere in any way with any
            right the Company or any Subsidiary would otherwise have to
            terminate such Participant's employment or other service at any
            time.

      (f)         To the extent that any provision of this Plan would prevent
            any Option Right that was intended to qualify as an Incentive Stock
            Option from qualifying as such, that provision will be null and void
            with respect to such Option Right. Such provision, however, will
            remain in effect for other Option Rights and there will be no
            further effect on any provision of this Plan.

      (g)         The Board may amend the terms of any award theretofore granted
            under this Plan prospectively or retroactively, but subject to
            Section 12 above, no such amendment shall impair the rights of any
            Participant without his or her consent. The Board may, in its
            discretion, terminate this Plan at any time. Termination of this
            Plan will not affect the rights of Participants or their successors
            under any awards outstanding hereunder and not exercised in full on
            the date of termination.

                                       18
<PAGE>

18.         DETRIMENTAL ACTIVITY. Any Evidence of Award may provide that if a
      Participant, either during employment by the Company or a Subsidiary or
      within a specified period after termination of such employment, shall
      engage in any Detrimental Activity, and the Board shall so find, forthwith
      upon notice of such finding, the Participant shall:

      (a)         Forfeit any award granted under the Plan then held by the
            Participant;

      (b)         Return to the Company, in exchange for payment by the Company
            of any amount actually paid therefor by the Participant, all Common
            Shares that the Participant has not disposed of that were offered
            pursuant to this Plan within a specified period prior to the date of
            the commencement of such Detrimental Activity, and

      (c)         With respect to any Common Shares so acquired that the
            Participant has disposed of, pay to the Company in cash the
            difference between:

            (i)   Any amount actually paid therefor by the Participant pursuant
                  to this Plan, and

            (ii)  The Market Value per Share of the Common Shares on the date of
                  such acquisition.

To the extent that such amounts are not paid to the Company, the Company may set
off the amounts so payable to it against any amounts that may be owing from time
to time by the Company or a Subsidiary to the Participant, whether as wages,
deferred compensation or vacation pay or in the form of any other benefit or for
any other reason.

                                       19
<PAGE>

19.         COMPLIANCE WITH SECTION 409A OF THE CODE. To the extent applicable,
      it is intended that this Plan and any grants made hereunder comply with
      the provisions of Section 409A of the Code. The Plan and any grants made
      hereunder shall be administrated in a manner consistent with this intent,
      and any provision that would cause the Plan or any grant made hereunder to
      fail to satisfy Section 409A of the Code shall have no force and effect
      until amended to comply with Section 409A of the Code (which amendment may
      be retroactive to the extent permitted by Section 409A of the Code and may
      be made by the Company without the consent of Participants). Any reference
      in this Plan to Section 409A of the Code will also include any proposed,
      temporary or final regulations, or any other guidance, promulgated with
      respect to such Section by the U.S. Department of the Treasury or the
      Internal Revenue Service.

20.         GOVERNING LAW. The Plan and all grants and awards and actions taken
      thereunder shall be governed by and construed in accordance with the
      internal substantive laws of the State of Ohio.

21.         TERMINATION. No grant will be made under this Plan more than 10
      years after the date on which this Plan is first approved by the
      shareholders of the Company, but all grants made on or prior to such date
      will continue in effect thereafter subject to the terms thereof and of
      this Plan.

22.         GENERAL PROVISIONS.

      (a)         No award under this Plan may be exercised by the holder
            thereof if such exercise, and the receipt of cash or stock
            thereunder, would be, in the opinion of counsel selected by the
            Board, contrary to law or the regulations of any duly constituted
            authority having jurisdiction over this Plan.

      (b)         Absence on leave approved by a duly constituted officer of the
            Company or any of its Subsidiaries shall not be considered
            interruption or termination of service of any employee for any
            purposes of this Plan or awards granted hereunder, except that no
            awards may be granted to an employee while he or she is absent on
            leave.

      (c)         No Participant shall have any rights as a stockholder with
            respect to any shares subject to awards granted to him or her under
            this Plan prior to the date as of which he or she is actually
            recorded as the holder of such shares upon the stock records of the
            Company.

      (d)         If any provision of the Plan is or becomes invalid, illegal or
            unenforceable in any jurisdiction, or would disqualify the Plan or
            any award under any law deemed applicable by the Board, such
            provision shall be construed or deemed amended or limited in scope
            to conform to applicable laws or, in the discretion of the Board, it
            shall be stricken and the remainder of the Plan shall remain in full
            force and effect.

                                       20

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