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                              [POLYONE LETTERHEAD]

                                 January 5, 2005


Attn:  [____________]
PolyOne Corporation

                       POLYONE CORPORATION INCENTIVE AWARD

                           GRANT OF PERFORMANCE SHARES


THIS AGREEMENT CONSTITUTES PART OF A PROSPECTUS COVERING SECURITIES REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE COMMON SHARES OF THE COMPANY
ARE LISTED ON THE NEW YORK STOCK EXCHANGE.


Dear [_________________]:

                  Subject to the terms and conditions of the [INSERT PLAN] (the
"Plan") and this letter agreement (this "Agreement"), the Compensation and
Governance Committee of the Board of Directors (the "Committee") of PolyOne
Corporation ("PolyOne") (or a subcommittee thereof) has granted to you as of
January 5, 2005, the following award:

         [_____] performance shares (the "Performance Shares"), payment of which
         depends on PolyOne's performance as set forth in this Agreement and in
         your Statement of Performance Goals.

                  A copy of the Plan is available for your review through the
Corporate Secretary's office. Unless otherwise indicated, the capitalized terms
used in this Agreement shall have the same meanings as set forth in the Plan.

1.       PERFORMANCE SHARES.

         (a)      Your right to receive all or any portion of the Performance
                  Shares will be contingent upon the achievement of certain
                  management objectives (the "Management Objectives"), as set
                  forth in your Statement of Performance Goals. The achievement
                  of the Management Objectives will be measured during the
                  period from January 1, 2005 through December 31, 2007 (the
                  "Performance Period").




         (b)      The Management Objectives for the Performance Period will be
                  based on Cash Flow ("Cash Flow"), Return on Invested Capital
                  ("ROIC") and the level of EBITDA in relation to debt ("Debt to
                  EBITDA"), all as defined in your Statement of Performance
                  Goals. Each of the Management Objectives will be weighted
                  thirty three and one-third percent (33 1/3%) and, therefore:

                  (i)      thirty three and one-third percent (33 1/3%) of the
                           total number of Performance Shares will be based on
                           Cash Flow (the "Cash Flow Performance Shares");

                  (ii)     thirty three and one-third percent (33 1/3%) of the
                           total number of Performance Shares will be based on
                           ROIC (the "ROIC Performance Shares"); and

                  (iii)    thirty three and one-third percent (33 1/3%) of the
                           total number of Performance Shares will be based on
                           Debt to EBITDA (the "Debt to EBITDA Performance
                           Shares").

2.       EARNING OF PERFORMANCE SHARES.

         (a)      The Cash Flow Performance Shares.

                  (i)      If, upon the conclusion of the Performance Period,
                           Cash Flow equals or exceeds the threshold level, but
                           is less than the 100% target level, as set forth in
                           the Performance Matrix contained in your Statement of
                           Performance Goals, a proportionate number of the Cash
                           Flow Performance Shares shall become earned, as
                           determined by mathematical interpolation and rounded
                           up to the nearest whole share.

                  (ii)     If, upon the conclusion of the Performance Period,
                           Cash Flow equals or exceeds the 100% target level,
                           but is less than the maximum level, as set forth in
                           the Performance Matrix contained in your Statement of
                           Performance Goals, a proportionate number of the Cash
                           Flow Performance Shares shall become earned, as
                           determined by mathematical interpolation and rounded
                           up to the nearest whole share.

                  (iii)    If, upon the conclusion of the Performance Period,
                           Cash Flow equals or exceeds the maximum level, as set
                           forth in the Performance Matrix contained in your
                           Statement of Performance Goals, 200% of the Cash Flow
                           Performance Shares shall become earned.

         (b)      The ROIC Performance Shares.

                  (i)      If, upon the conclusion of the Performance Period,
                           PolyOne's ROIC exceeds PolyOne's peer group ROIC by
                           at least one percentage point and PolyOne's ROIC is
                           at least the threshold level as set forth in the
                           Performance Matrix (as modified by the ROIC Modifier
                           Matrix) included in your Statement of Performance
                           Goals, a percentage of the ROIC




                                       2


                           Performance Shares shall become earned, as set forth
                           in the Performance Matrix (as modified by the ROIC
                           Modifier Matrix) included in your Statement of
                           Performance Goals. The actual number of ROIC
                           Performance Shares earned will be determined by
                           mathematical interpolation and rounded up to the
                           nearest whole share.

                  (ii)     Notwithstanding (i) above, for every whole percentage
                           point greater than one that PolyOne's ROIC Change
                           surpasses or falls short of the Peer ROIC Change, the
                           number of ROIC Performance Shares that become earned
                           will be modified such that an additional fifteen (15)
                           percentage points will be added or subtracted, as the
                           case may be, from the percentage that becomes earned,
                           as provided in (i) above and as set forth in your
                           Statement of Performance Goals.

                           (A)      For purposes of this Section 2(b), "PolyOne
                                    ROIC Change" means the increase or decrease
                                    in PolyOne's ROIC from fiscal year 2004 to
                                    fiscal year 2007.

                           (B)      For purposes of this Section 2(b), "Peer
                                    ROIC Change" means the increase or decrease
                                    in the total ROIC for PolyOne's peer group
                                    from fiscal year 2004 to fiscal year 2007.

         (c)      The Debt to EBITDA Performance Shares.

                  (i)      If, upon the conclusion of the Performance Period,
                           Debt to EBITDA equals or exceeds the threshold level,
                           but is less than the 100% target level, as set forth
                           in the Performance Matrix contained in your Statement
                           of Performance Goals, 50% of the Debt to EBITDA
                           Performance Shares shall become earned.

                  (ii)     If, upon the conclusion of the Performance Period,
                           Debt to EBITDA equals or exceeds the 100% target
                           level, but is less than the 150% target level, as set
                           forth in the Performance Matrix contained in your
                           Statement of Performance Goals, 100% of the Debt to
                           EBITDA Performance Shares shall become earned.

                  (iii)    If, upon the conclusion of the Performance Period,
                           Debt to EBITDA equals or exceeds the 150% target
                           level, but is less than the maximum level, as set
                           forth in the Performance Matrix contained in your
                           Statement of Performance Goals, 150% of the Debt to
                           EBITDA Performance Shares shall become earned.

                  (iv)     If, upon the conclusion of the Performance Period,
                           Debt to EBITDA equals or exceeds the maximum level,
                           as set forth in the Performance Matrix contained in
                           your Statement of Performance Goals, 200% of the Debt
                           to EBITDA Performance Shares shall become earned.



                                       3


         (d)      In no event shall any Performance Shares become earned if
                  actual performance falls below the threshold level for each
                  relevant Management Objective, except as noted in the ROIC
                  Modifier Matrix contained in your Statement of Performance
                  Goals.

         (e)      If the Committee determines that a change in the business,
                  operations, corporate structure or capital structure of
                  PolyOne, the manner in which it conducts business or other
                  events or circumstances render the Management Objectives to be
                  unsuitable, the Committee may modify such Management
                  Objectives or the related levels of achievement, in whole or
                  in part, as the Committee deems appropriate; provided,
                  however, that no such action may result in the loss of the
                  otherwise available exemption of the award under Section
                  162(m) of the Internal Revenue Code of 1986, as amended.

         (f)      Your right to receive any Performance Shares is contingent
                  upon your remaining in the continuous employ of PolyOne or a
                  subsidiary of PolyOne (a "Subsidiary") through the end of the
                  Performance Period. Following the Performance Period, the
                  Committee shall determine the number of Performance Shares
                  that shall have become earned hereunder. In all circumstances,
                  the Committee shall have the ability and authority to reduce,
                  but not increase, the amount of Performance Shares that become
                  earned hereunder.

3.       CHANGE OF CONTROL. If a Change of Control (as defined on Exhibit A to
         this Agreement) occurs during the Performance Period, PolyOne shall pay
         to you 100% of the Performance Shares within 15 days after the Change
         of Control.

4.       RETIREMENT, DISABILITY OR DEATH. If your employment with PolyOne or a
         Subsidiary terminates before the end of the Performance Period due to
         (1) retirement at age 55 or older with at least 10 years of service or
         retirement under other circumstances entitling you to receive benefits
         under one of PolyOne's (including its predecessors) defined benefit
         pension plans, (2) permanent and total disability (as defined under the
         relevant disability plan or program of PolyOne or a Subsidiary in which
         you then participate) or (3) death, PolyOne shall pay to you or your
         executor or administrator, as the case may be, after the end of the
         Performance Period, the portion of the Performance Shares to which you
         would have been entitled under Section 2 above, had you remained
         employed by PolyOne through the end of the Performance Period, prorated
         based on the portion of the Performance Period during which you were
         employed by PolyOne.

5.       OTHER TERMINATION. If your employment with PolyOne or a Subsidiary
         terminates before the end of the Performance Period, for any reason
         other than as set forth in Section 4 above, the Performance Shares will
         be forfeited.

6.       PAYMENT OF PERFORMANCE SHARES. Payment of any Performance Shares that
         become earned as set forth herein will typically be made in the form of
         common shares of PolyOne having a par value of $.01 per share ("Common
         Shares"), but may be made in cash, in the Committee's discretion.
         Payment will be made as soon as practicable after the receipt of
         audited financial statements of PolyOne relating to the last fiscal
         year of the




                                       4


         Performance Period and the determination by the Committee of the level
         of attainment of the Management Objectives, but in no event shall such
         payment occur after March 15, 2008. If PolyOne determines that it is
         required to withhold any federal, state, local or foreign taxes from
         any payment, PolyOne will withhold the amount of these taxes from the
         payment.

7.       NON-ASSIGNABILITY. The Performance Shares and the Common Shares subject
         to this grant of Performance Shares are personal to you and may not be
         sold, exchanged, assigned, transferred, pledged, encumbered or
         otherwise disposed of by you until they become earned as provided in
         this Agreement; provided, however, that your rights with respect to
         such Performance Shares and Common Shares may be transferred by will or
         pursuant to the laws of descent and distribution. Any purported
         transfer or encumbrance in violation of the provisions of this Section
         7, shall be void, and the other party to any such purported transaction
         shall not obtain any rights to or interest in such Performance Shares
         or Common Shares.

8.       ADJUSTMENTS. In the event of any change in the number of Common Shares
         by reason of a merger, consolidation, reorganization, recapitalization,
         or similar transaction, or in the event of a stock dividend, stock
         split, or distribution to shareholders (other than normal cash
         dividends), the Committee shall adjust the number and class of shares
         subject to outstanding Performance Shares and other value
         determinations applicable to outstanding Performance Shares. No
         adjustment provided for in this Section 8 shall require PolyOne to
         issue any fractional share.

9.       MISCELLANEOUS.

         (a)      The contents of this Agreement are subject in all respects to
                  the terms and conditions of the Plan as approved by the Board
                  of Directors and the shareholders of PolyOne, which are
                  controlling. The interpretation and construction by the Board
                  of Directors and/or the Committee of any provision of the Plan
                  or this Agreement shall be final and conclusive upon you, your
                  estate, executor, administrator, beneficiaries, personal
                  representative and guardian and PolyOne and its successors and
                  assigns.

         (b)      The grant of the Performance Shares is discretionary and will
                  not be considered to be an employment contract or a part of
                  your terms and conditions of employment or of your salary or
                  compensation. Your acceptance of this grant constitutes your
                  consent to the transfer of data and information concerning or
                  arising out of this grant to PolyOne and to non-PolyOne
                  entities engaged by PolyOne to provide services in connection
                  with this grant from non-U.S. entities related to PolyOne for
                  purposes of any applicable privacy, information or data
                  protection laws and regulations.

         (c)      Any amendment to the Plan shall be deemed to be an amendment
                  to this Agreement to the extent that the amendment is
                  applicable hereto. The terms and conditions of this Agreement
                  may not be modified, amended or waived, except by an
                  instrument in writing signed by a duly authorized executive
                  officer at PolyOne.



                                       5


                  Notwithstanding the foregoing, no amendment shall adversely
                  affect your rights under this Agreement without your consent.

10.      NOTICE. All notices under this Agreement to PolyOne must be delivered
         personally or mailed to PolyOne Corporation at PolyOne Center, Avon
         Lake, Ohio 44012, Attention: Corporate Secretary. PolyOne's address may
         be changed at any time by written notice of such change to you. Also,
         all notices under this Agreement to you will be delivered personally or
         mailed to you at your address as shown from time to time in PolyOne's
         records.

                  This Agreement, and the terms and conditions of the Plan,
shall bind, and inure to the benefit of you, your estate, executor,
administrator, beneficiaries, personal representative and guardian and PolyOne
and its successors and assigns.

                                     Very Truly Yours,

                                     POLYONE CORPORATION


                                     By:________________________________________
                                        Kenneth M. Smith, Vice President and
                                        Chief Human Resources Officer

Accepted:

___________________________________

___________________________________  (Date)





                                       6


                                    EXHIBIT A


A "Change of Control" means:

(a) the acquisition by an 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 25% 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 (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 paragraph (c)
below; provided, further, that if any Person's beneficial ownership of the
Outstanding Company Voting Securities reaches or exceeds 25% 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 subsequent acquisition shall be treated as an acquisition that causes such
Person to own 25% 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 25% 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 25% of the Outstanding Company Voting Securities, then
no Change of Control shall have occurred as a result of such Person's
acquisition; or

(b) individuals who, as of August 31, 2000, 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 August
31, 2000 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

(c) the approval by the shareholders of the Company 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") or, if consummation of such Business Combination is
subject, at the time of such approval by shareholders, to the consent of any
government or governmental agency, the obtaining of such consent (either
explicitly or implicitly by consummation); excluding, however, such a Business
Combination pursuant to which (i) all or substantially all of the individuals
and entities who were the


                                      A-1


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, 25% 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 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

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



                                      A-2

                              [POLYONE LETTERHEAD]

                                     [DATE]

Attn:  [____________]
PolyOne Corporation

                       POLYONE CORPORATION INCENTIVE AWARD

                          GRANT OF STOCK-SETTLED SAR'S

THIS AGREEMENT CONSTITUTES PART OF A PROSPECTUS COVERING SECURITIES REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THE COMMON SHARES OF THE COMPANY
ARE LISTED ON THE NEW YORK STOCK EXCHANGE.


Dear [_________________]:

                  Subject to the terms and conditions of the [INSERT PLAN] (the
"Plan") and this letter agreement (this "Agreement"), the Compensation and
Governance Committee of the Board of Directors of PolyOne Corporation
("PolyOne") has granted to you as of [DATE], the following award:

         Target Priced Stock Appreciation Rights ("SARs") in respect of an
         aggregate of [_____] common shares of PolyOne, having a par value of
         $.01 per share (the "Common Shares"). The price (the "Base Price") to
         be used as the basis for determining the Spread (as defined below) upon
         exercise of the SAR is $______, the fair market value of one Common
         Share as of the date of this grant.

                  A copy of the Plan is available for your review through the
Corporate Secretary's office. Unless otherwise indicated, the capitalized terms
used in this Agreement shall have the same meanings as set forth in the Plan.

1.       EXERCISE OF SARs.

         (a)      Subject to the provisions of the Plan and this Agreement, the
                  SARs will expire on [DATE] and shall be exercisable on or
                  before [DATE]. Provided that you have been in the continuous
                  employ of PolyOne on such date, vesting will occur when the
                  market price of the Common Shares as reported on the New York
                  Stock Exchange - Composite Transactions Listing or similar
                  report reaches pre-determined levels for a minimum of three
                  consecutive trading days as follows:

                           o        One-third vests at a market price of
                                    $_______;




                           o        One-third vests at a market price of
                                    $_______; and

                           o        The remaining one-third vests at a market
                                    price of $_______.

         (b)      The SARs may be exercised as provided in this Section 1(b) as
                  to all or any of the SARs that are exercisable in accordance
                  with Section 1(a), as long as each exercise covers at least
                  1,000 SARs. To exercise the SARs, you must submit a letter to
                  PolyOne signed by you stating the number of SARs you are
                  exercising at that time and certifying that you are in
                  compliance with the terms and conditions of the Plan. PolyOne
                  will then issue you the number of Common Shares determined
                  under Section 1(c).

         (c)      The number of Common Shares to be issued will be determined by
                  calculating (1) the difference between the fair market value
                  of a Common Share on the date of exercise and the Base Price
                  (the "Spread"); (2) multiplied by the number of SARs
                  exercised; (3) less any withholding taxes (federal, state,
                  local or foreign taxes) PolyOne determines are to be withheld
                  in accordance with the Plan and with applicable law. The
                  result of this calculation will then be divided by the fair
                  market value of a Common Share on the date of exercise to
                  determine the number of Common Shares to be issued, rounded
                  down to the nearest whole share. For purposes of this Section
                  1(c), the term "fair market value" will mean the mean of the
                  high and low prices of the Common Shares for the relevant date
                  as reported on the New York Stock Exchange - Composite
                  Transactions Listing or similar report. In no event will you
                  be entitled to acquire a fraction of one Common Share pursuant
                  to this Agreement.

2.       VESTING UPON A CHANGE OF CONTROL. If a Change of Control (as defined on
         Exhibit A to this Agreement) occurs during the term of the SARs, the
         SARs, to the extent not previously fully exercisable, will become
         immediately exercisable in full.

3.       RETIREMENT, DISABILITY OR DEATH. If your employment with PolyOne or a
         subsidiary company (a "Subsidiary") terminates before the expiration of
         the SARs due to (1) retirement at age 55 or older with at least 10
         years of service or retirement under other circumstances entitling you
         to receive benefits under one of PolyOne's (including its predecessors)
         defined benefit pension plans, (2) permanent and total disability (as
         defined under the relevant disability plan or program of PolyOne or a
         Subsidiary in which you then participate) or (3) death, the SARs, to
         the extent not previously fully exercisable, shall become immediately
         exercisable in full and may be exercised in whole or in part at any
         time and from time to time for the remainder of their term, but in no
         event beyond [Date], after which such SARs will terminate.

4.       TERMINATION FOLLOWING CHANGE OF CONTROL.

         (a)      If your employment with PolyOne or a Subsidiary terminates
                  following a Change of Control because (i) your employment is
                  involuntarily terminated without "cause" (as defined below),
                  or (ii) if you are a party to a Management Continuity
                  Agreement with PolyOne, you terminate your employment for
                  "Good Reason" (as



                                       2


                  defined in your Management Continuity Agreement), or (iii) if
                  you are not a party to a Management Continuity Agreement with
                  PolyOne, you terminate your employment for "Good Reason" (as
                  defined in the PolyOne Employee Transition Plan (as amended
                  and restated, effective as of January 1, 2004) or any
                  successor plan (the "PolyOne ETP")), the SARs may be exercised
                  in whole or in part at any time and from time to time within
                  eighteen (18) months of your termination of employment, but in
                  no event beyond [DATE], after which the SARs will terminate.

         (b)      For purposes of Section 4(a) above:

                  (i)      If you are a party to a Management Continuity
                           Agreement, "cause" shall mean the definition of
                           "cause" as set forth in your Management Continuity
                           Agreement; or

                  (ii)     If you are not a party to a Management Continuity
                           Agreement, "cause" shall mean: (A) the willful and
                           continued failure by you to substantially perform
                           your duties with PolyOne, which failure causes
                           material and demonstrable injury to PolyOne (other
                           than any such failure resulting from your incapacity
                           due to physical or mental illness), after a demand
                           for substantial performance is delivered to you by
                           PolyOne which specifically identifies the manner in
                           which you have not substantially performed your
                           duties, and after you have been given a period
                           (hereinafter known as the "Cure Period") of at least
                           thirty (30) days to correct your performance, or (B)
                           the willful engaging by you in other gross misconduct
                           materially and demonstrably injurious to PolyOne. For
                           purposes of this Section 4(b)(ii), no act, or failure
                           to act, on your part shall be considered "willful"
                           unless conclusively demonstrated to have been done,
                           or omitted to be done, by you not in good faith and
                           without reasonable belief that your action or
                           omission was in the best interests of PolyOne.

5.       OTHER TERMINATION.

         (a)      If your employment with PolyOne or a Subsidiary terminates
                  before the expiration of the SARs for any reason other than as
                  set forth in Sections 3 or 4 above, the SARs that are
                  exercisable shall be limited to the number of SARs that could
                  have been exercised under Section 1 above at the time of your
                  termination of employment and shall terminate as to the
                  remaining SARs and may be exercised as to such limited number
                  of SARs at any time within ninety (90) days of your
                  termination of employment, but in no event beyond [DATE],
                  after which the SARs will terminate.

         (b)      Notwithstanding Section 5(a) above, if your employment is
                  terminated due to a Reduction in Force Termination (as such
                  phrase is defined in the PolyOne ETP), then the exercisable
                  SARs may be exercised at any time within eighteen (18) months
                  of your termination of employment, but in no event beyond
                  [DATE], after which the SARs will terminate; provided,
                  however, that, notwithstanding anything in the PolyOne ETP to
                  the contrary, the Reduction in Force Termination




                                       3


                  must be effected by PolyOne or a corporation incorporated
                  within the United States of America that is directly or
                  indirectly owned by PolyOne. This Section 5(b) will apply to
                  you regardless of whether you are eligible to receive benefits
                  under the PolyOne ETP.

6.       NON-ASSIGNABILITY. The SARs are personal to you and are not
         transferable by you other than by will or the laws of descent and
         distribution. They are exercisable during your lifetime only by you or
         by your guardian or legal representative.

7.       ADJUSTMENTS. In the event of any change in the number of Common Shares
         by reason of a merger, consolidation, reorganization, recapitalization,
         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
         subject to outstanding SARs, the Base Price applicable to outstanding
         SARs and other value determinations, if any, applicable to outstanding
         SARs. If any such transaction or event occurs, the Committee may
         provide in substitution for outstanding SARs such alternative
         consideration (including, without limitation, in the form of cash,
         securities or other property) as it may determine to be equitable in
         the circumstances and may require in connection therewith the surrender
         of the SARs subject to this Agreement. No adjustment provided for in
         this Section 7 will require PolyOne to issue any fractional share.

8.       MISCELLANEOUS.

         (a)      The contents of this letter are subject in all respects to the
                  terms and conditions of the Plan as approved by the Board of
                  Directors and the shareholders of PolyOne, which are
                  controlling. The interpretation and construction by the Board
                  of Directors and/or the Committee of any provision of the Plan
                  or this Agreement shall be final and conclusive upon you, your
                  estate, executor, administrator, beneficiaries, personal
                  representative and guardian and PolyOne and its successors and
                  assigns.

         (b)      The grant of the SARs is discretionary and will not be
                  considered to be an employment contract or a part of your
                  terms and conditions of employment or of your salary or
                  compensation. Your acceptance of this grant constitutes your
                  consent to the transfer of data and information concerning or
                  arising out of this grant to PolyOne and to non-PolyOne
                  entities engaged by PolyOne to provide services in connection
                  with this grant from non-U.S. entities related to PolyOne for
                  purposes of any applicable privacy, information or data
                  protection laws and regulations.

         (c)      Any amendment to the Plan shall be deemed to be an amendment
                  to this Agreement to the extent that the amendment is
                  applicable hereto. The terms and conditions of this Agreement
                  may not be modified, amended or waived, except by an
                  instrument in writing signed by a duly authorized executive
                  officer at PolyOne. Notwithstanding the foregoing, no
                  amendment shall adversely affect your rights under this
                  Agreement without your consent.



                                       4


9.       NOTICE. All notices under this Agreement to PolyOne must be delivered
         personally or mailed to PolyOne Corporation at PolyOne Center, Avon
         Lake, Ohio 44012, Attention: Corporate Secretary. PolyOne's address may
         be changed at any time by written notice of such change to you. Also,
         all notices under this Agreement to you will be delivered personally or
         mailed to you at your address as shown from time to time in PolyOne's
         records.

                  This Agreement, and the terms and conditions of the Plan,
shall bind, and inure to the benefit of you, your estate, executor,
administrator, beneficiaries, personal representative and guardian and PolyOne
and its successors and assigns.

                                      Very Truly Yours,

                                      POLYONE CORPORATION


                                      By:_______________________________________
                                         Kenneth M. Smith, Vice President and
                                         Chief Human Resources Officer

Accepted:

______________________________

______________________________ (Date)



                                       5


                                    EXHIBIT A


A "Change of Control" means:

(a) the acquisition by an 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 25% 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 (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 paragraph (c)
below; provided, further, that if any Person's beneficial ownership of the
Outstanding Company Voting Securities reaches or exceeds 25% 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 subsequent acquisition shall be treated as an acquisition that causes such
Person to own 25% 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 25% 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 25% of the Outstanding Company Voting Securities, then
no Change of Control shall have occurred as a result of such Person's
acquisition; or

(b) individuals who, as of August 31, 2000, 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 August
31, 2000 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

(c) the approval by the shareholders of the Company 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") or, if consummation of such Business Combination is
subject, at the time of such approval by shareholders, to the consent of any
government or governmental agency, the obtaining of such consent (either
explicitly or implicitly by consummation); excluding, however, such a Business
Combination pursuant to which (i) all or substantially all of the individuals
and entities who were the



                                      A-1



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, 25% 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 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

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


                                      A-2