Document:

ROYCE BIOMEDICAL, INC.
                                STOCK BONUS PLAN

         l.  Purpose.  The  purpose of this Stock  Bonus Plan is to advance  the
interests of Royce  Biomedical,  Inc. (the "Company") and its  shareholders,  by
encouraging  and enabling  selected  officers,  directors,  consultants  and key
employees  upon whose  judgment,  initiative  and effort the  Company is largely
dependent for the  successful  conduct of its business,  to acquire and retain a
proprietary interest in the Company by ownership of its stock, to keep personnel
of experience  and ability in the employ of the Company and to  compensate  them
for their  contributions  to the growth and  profits of the  Company and thereby
induce them to continue to make such contributions in the future.

         2.   Definitions.

A.   "Board" shall mean the board of directors of the Company.

B.   "Committee" means the directors duly appointed to administer the Plan.

C.   "Plan" shall mean this Stock Bonus Plan.

D.   "Bonus Share" shall mean the shares of common stock of the Company reserved
     pursuant  to Section 4 hereof  and any such  shares  issued to a  Recipient
     pursuant to this Plan.

E.   "Recipient" shall mean any individual rendering services for the Company to
     whom shares are granted pursuant to this Plan.

         3.  Administration  of  Plan.  The  Plan  shall  be  administered  by a
committee of two or more directors appointed by the Board (the "Committee"). The
Committee shall report all action taken by it to the Board.  The Committee shall
have full and final  authority in its  discretion,  subject to the provisions of
the Plan,  to determine the  individuals  to whom and the time or times at which
Bonus  Shares shall be granted and the number of Bonus  Shares;  to construe and
interpret  the  Plan;  and to make all other  determinations  and take all other
actions deemed necessary or advisable for the proper administration of the Plan.
All such  actions  and  determinations  shall be  conclusively  binding  for all
purposes and upon all persons.

         4. Bonus  Share  Reserve.  There  shall be  established  a Bonus  Share
Reserve to which shall be credited 150,000 shares of the Company's common stock.
In the event that the shares of common stock of the Company should,  as a result
of a stock split or stock dividend or combination of shares or any other change,
or exchange for other securities by  reclassification,  reorganization,  merger,
consolidation,  recapitalization  or  otherwise,  be  increased  or decreased or
changed into or exchanged for, a different  number or kind of shares of stock or
other securities of the Company or of another corporation,  the number of shares
then  remaining in the Bonus Share  Reserve shall be  appropriately  adjusted to

<PAGE>

reflect such action.  Upon the grant of shares hereunder,  this reserve shall be
reduced by the number of shares so granted.  Distributions  of Bonus Shares may,
as the Committee shall in its sole discretion determine, be made from authorized
but unissued shares or from treasury shares.  All authorized and unissued shares
issued  as Bonus  Shares in  accordance  with the Plan  shall be fully  paid and
non-assessable and free from preemptive rights.

         5. Eligibility,  and Granting and Vesting of Bonus Shares. Bonus Shares
may be granted under the Plan to the  Company's (or the Company's  subsidiaries)
employees,  directors and officers,  and  consultants or advisors to the Company
(or its  subsidiaries),  provided  however  that  bona  fide  services  shall be
rendered  by such  consultants  or  advisors  and such  services  must not be in
connection   with  the  offer  or  sale  of  securities  in  a   capital-raising
transaction.

              The Committee, in its sole discretion, is empowered to grant to an
eligible Participant a number of Bonus Shares as it shall determine from time to
time.  Each grant of these Bonus  Shares  shall  become  vested  according  to a
schedule to be established by the Committee  directors at the time of the grant.
For  purposes  of this plan,  vesting  shall mean the  period  during  which the
recipient must remain an employee or provide  services for the Company.  At such
time as the  employment  of the  Recipient  ceases,  any shares not fully vested
shall be  forfeited  by the  Recipient  and shall be returned to the Bonus Share
Reserve. The Committee, in its sole discretion,  may also impose restrictions on
the future  transferability of the bonus shares, which restrictions shall be set
forth on the notification to the Recipient of the grant.

              The aggregate number of Bonus Shares which may be granted pursuant
to this Plan shall not exceed the amount available  therefore in the Bonus Share
Reserve.

         6. Form of Grants.  Each grant shall specify the number of Bonus Shares
subject thereto, subject to the provisions of Section 5 hereof.

              At the time of making any grant,  the  Committee  shall advise the
Recipient  by  delivery  of  written  notice,  in the form of  Exhibit  A hereto
annexed.

         7.   Recipients' Representations.

              A. The  Committee may require that, in acquiring any Bonus Shares,
the  Recipient  agree with,  and represent to, the Company that the Recipient is
acquiring  such Bonus Shares for the purpose of  investment  and with no present
intention  to  transfer,  sell  or  otherwise  dispose  of  shares  except  such
distribution by a legal  representative as shall be required by will or the laws
of any jurisdiction in winding-up the estate of any Recipient. Such shares shall
be transferable  thereafter  only if the proposed  transfer shall be permissible
pursuant  to  the  Plan  and  if,  in the  opinion  of  counsel  (who  shall  be
satisfactory  to  the  Committee),  such  transfer  shall  at  such  time  be in
compliance with applicable securities laws.

              B. To effectuate Paragraph A above, the Recipient shall deliver to
the Committee,  in duplicate,  an agreement in writing, signed by the Recipient,
in form  and  substance  as set  forth in  Exhibit  B  hereto  annexed,  and the
Committee shall forthwith acknowledge its receipt thereof.

<PAGE>

         8.  Restrictions  Upon Issuance.

     A. Bonus Shares  shall  forthwith  after the making of any  representations
required by Section 6 hereof, or if no representations  are required then within
thirty  (30) days of the date of grant,  be duly  issued and  transferred  and a
certificate or  certificates  for such shares shall be issued in the Recipient's
name.  The Recipient  shall  thereupon be a shareholder  with respect to all the
shares  represented  by such  certificate  or  certificates,  shall have all the
rights of a shareholder with respect to all such shares,  including the right to
vote such shares and to receive all dividends and other  distributions  (subject
to the  provisions  of Section  7(B)  hereof)  paid with respect to such shares.
Certificates of stock representing Bonus Shares shall be imprinted with a legend
to the effect that the shares represented  thereby are subject to the provisions
of this Agreement,  and to the vesting and transfer  limitations  established by
the Committee,  and each transfer agent for the common stock shall be instructed
to like effect with respect of such shares.

              B. In the event  that,  as the  result  of a stock  split or stock
dividend or  combination  of shares or any other  change,  or exchange for other
securities,   by  reclassification,   reorganization,   merger,   consolidation,
recapitalization or otherwise, the Recipient shall, as owner of the Bonus Shares
subject to restrictions hereunder, be entitled to new or additional or different
shares of stock or securities,  the  certificate or  certificates  for, or other
evidences of, such new or additional or different shares or securities, together
with a stock power or other instrument of transfer appropriately endorsed, shall
also be imprinted  with a legend as provided in Section 7(A), and all provisions
of the Plan  relating  to  restrictions  herein  set forth  shall  thereupon  be
applicable to such new or  additional  or different  shares or securities to the
extent applicable to the shares with respect to which they were distributed.

              C. The grant of any Bonus Shares shall be subject to the condition
that if at any time the  Company  shall  determine  in its  discretion  that the
satisfaction of withholding tax or other  withholding  liabilities,  or that the
listing,  registration,  or qualification of any Bonus Shares upon such exercise
upon any  securities  exchange  or under any state or federal  law,  or that the
consent or approval of any  regulatory  body,  is  necessary  or  desirable as a
condition of, or in connection  with, the issuance of any Bonus Shares,  then in
any such event,  such exercise shall not be effective  unless such  withholding,
listing,  registration,  qualification,  consent,  or  approval  shall have been
effected or obtained free of any conditions not acceptable to the Company.

              D.  Unless  the  Bonus  Shares  covered  by  the  Plan  have  been
registered with the Securities and Exchange  Commission pursuant to Section 5 of
the Securities Act of l933,  each Recipient  shall,  by accepting a Bonus Share,
represent  and agree,  for  himself and his  transferees  by will or the laws of
descent and distribution, that all Bonus Shares were acquired for investment and
not for resale or  distribution.  The person  entitled to receive  Bonus  Shares
shall,  upon request of the  Committee,  furnish  evidence  satisfactory  to the
Committee (including a written and signed representation) to the effect that the
shares of stock are being  acquired  in good  faith for  investment  and not for
resale or distribution. Furthermore, the Committee may, if it deems appropriate,

<PAGE>

affix a legend to certificates  representing  Bonus Shares  indicating that such
Bonus  Shares  have  not  been  registered  with  the  Securities  and  Exchange
Commission and may so notify the Company's  transfer  agent.  Such shares may be
disposed of by a Recipient  in the  following  manner  only:  (l) pursuant to an
effective  registration  statement covering such resale or reoffer, (2) pursuant
to an applicable  exemption from  registration as indicated in a written opinion
of counsel acceptable to the Company, or (3) in a transaction that meets all the
requirements  of Rule l44 of the  Securities and Exchange  Commission.  If Bonus
Shares covered by the Plan have been registered with the Securities and Exchange
Commission,  no such  restrictions on resale shall apply,  except in the case of
Recipients  who  are  directors,  officers,  or  principal  shareholders  of the
Company.  Such persons may dispose of shares only by one of the three  aforesaid
methods.

         9.  Limitations.  Neither the action of the Company in establishing the
Plan,  nor any action taken by it nor by the Committee  under the Plan,  nor any
provision  of the Plan,  shall be construed as giving to any person the right to
be retained in the employ of the Company.

              Every  right of action by any  person  receiving  shares of common
stock  pursuant to this Plan against any past,  present or future  member of the
Board, or any officer or employee of the Company arising out of or in connection
with this Plan shall,  irrespective of the place where action may be brought and
irrespective of the place of residence of any such director, officer or employee
cease and be barred  by the  expiration  of one year from the date of the act or
omission in respect of which such right of action arises.

         10.  Amendment,  Suspension or  Termination  of the Plan.  The Board of
Directors may alter, suspend, or discontinue the Plan at any time.

         Unless the Plan shall  theretofore  have been  terminated by the Board,
the Plan shall  terminate  ten years after the  effective  date of the Plan.  No
Bonus Share may be granted during any suspension or after the termination of the
Plan. No amendment,  suspension,  or  termination  of the Plan shall,  without a
recipient's consent,  alter or impair any of the rights or obligations under any
Bonus Share theretofore granted to such recipient under the Plan.

         11.  Governing Law. The Plan shall be governed by the laws of the State
of Colorado.

         12. Expenses of Administration.  All costs and expenses incurred in the
operation and administration of this Plan shall be borne by the Company.

<PAGE>

                                  - EXHIBIT A -

ROYCE BIOMEDICAL, INC.
STOCK BONUS PLAN

      TO: Recipient:  PLEASE BE ADVISED that Royce  Biomedical,  Inc. has on the
date hereof  granted to the  Recipient  the number of Bonus  Shares as set forth
under and  pursuant  to the Stock  Bonus  Plan.  Before  these  shares are to be
issued,  the Recipient must deliver to the Committee that  administers the Stock
Bonus Plan an agreement in duplicate, in the form as Exhibit B hereto. The Bonus
Shares are issued subject to the following vesting and transfer limitations.

            Vesting:

            Number of Shares                    Date of Vesting

            Transfer Limitations:

                                        ROYCE BIOMEDICAL, INC.

                                        By
               Date

<PAGE>

                                  - EXHIBIT B -

Royce Biomedical, Inc.
1100-1200 West 73rd Avenue
Vancouver, British Columbia
Canada V6P 6G5

Gentlemen:

     I represent  and agree that said Bonus Shares are being  acquired by me for
investment and that I have no present  intention to transfer,  sell or otherwise
dispose  of such  shares,  except  as  permitted  pursuant  to the  Plan  and in
compliance with applicable  securities  laws, and agree further that said shares
are being acquired by me in accordance with and subject to the terms, provisions
and conditions of said Plan, to all of which I hereby  expressly  assent.  These
agreements   shall  bind  and  inure  to  the   benefit   of  my  heirs,   legal
representatives, successors and assigns.

            My address of record is: ___________________

            and my social security number:  ___________________.

                                Very truly yours,

Receipt of the above is hereby acknowledged.

                                           ROYCE BIOMEDICAL, INC.

                                          By
       Date                                    itsEXHIBIT 10.1

                       ASSUMPTION, PAYMENT AGREEMENT AND
                     AMENDED AND RESTATED ROYALTY AGREEMENT

This Assumption, Payment Agreement and Amended and Restated Royalty Agreement
("this Assumption and Agreement") is entered into as of January 25, 1996, by and
between Robert C. Smallwood, individually ("Smallwood"), and American Compact
Lighting, L.L.C., a Virginia limited liability company. Hereinafter, "ACL" shall
refer to American Compact Lighting, L.L.C., its successor, or its permitted
assign, as the case may be. Smallwood and ACL are referred to hereinafter as,
individually, "Party" and, collectively, "Parties."

                               W I T N E S S E T H

      WHEREAS, ACL and Small wood entered into a Royalty Agreement, dated July
15, 1994 (the "Royalty Agreement"), under which ACL agreed to provide Smallwood
with a certain royalty in return for the consideration described in an
Assignment, dated January 10, 1994, executed by Smallwood (the "Assignment") to
ACL of certain rights of Smallwood in the field of electronic ballasts; and

      WHEREAS, ACL owed W. Gray Price, IV ("Price") the sum of $212,000.00 and
Timothy E. Walsh ("Walsh") the sum $73,000.00 for monies loaned to ACL by price
and Walsh; and

      WHEREAS, in connection with two promissory notes executed by Smallwood on
December 28, 1995, Smallwood assumed ACL's obligation to pay such sums to Price
and Walsh in consideration of ACL's willingness to amend and restate the Royalty
Agreement; and

      WHEREAS, the Parties desire to amend and restate the Royalty Agreement to
reflect Smallwood's assumption of the above stated obligations of ACL and the
royalty to be paid Smallwood.

      NOW, THEREFORE, in consideration of the foregoing and other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the Parties, intending to be legally bound, agree as follows:

      1. Smallwood hereby confirms his assumption of the obligation of ACL to
pay Price the sum of $212,000.00 and Walsh the sum of $73,000.00 and has
contemporaneously with his execution of this Assumption and Agreement executed
the promissory notes (the "Notes") attached as Exhibit A hereto, replacing the
promissory notes, dated December 28, 1995.

      2. (a) In consideration for the rights, title and interests assigned to
ACL under the Assignment and Smallwood's obligations to pay Price and Walsh as
set forth in Paragraph 1, above, ACL hereby reaffirms its prior obligations and
agrees to pay Smallwood a royalty (the

                                       1
<PAGE>

"Royalty") of five percent (5.00%) on all Royalty Revenue (as defined in
Paragraph 6 below) received by ACL during the Royalty Term (as defined in
Section 7 below) until such time as Smallwood receives from ACL a total payment
of $585,000 from ACL's Available Funds, pursuant to clauses (a) and (c) of
Paragraph 3, below, or from any other source in ACL's sole and absolute
discretion. If Smallwood has received from ACL an aggregate of $585,000 from
ACL's Available Funds, pursuant to clauses (a) and (c) of Paragraph 3, below, or
from any other source in ACL's sole and absolute discretion, the Royalty due
Smallwood pursuant to the immediately preceding sentence of this Paragraph 2
shall be reduced prospectively for the Royalty Term to a percentage equal to the
sum of (x) four and one-tenth percent (4.10%), plus (y) any percentage amount
(expressed in a percentage on all Royalty Revenue) Smallwood is obligated to pay
Richard M. Lavers, which percentage amount shall at no time exceed
fifteen-hundredths percent (0.15%) for an aggregate reduced Royalty of no more
than four and twenty-five hundredths percent (4.25%) on all Royalty Revenue.
Until Smallwood receives from ACL an aggregate of $585,000 from ACL's Available
Funds, pursuant to clauses (a) and (c) of Paragraph 3, below, or from any other
source in ACL's sole and absolute discretion, the Royalty due Smallwood pursuant
to the first sentence of this Paragraph 2 shall remain at five percent (5.0%)
for the Royalty Term on all Royalty Revenue received by ACL for the Royalty
Term.

            (b) ACL covenants and agrees to use reasonable efforts to make the
$585,000 payment due Smallwood pursuant to pursuant to Section 3, below,
on or before January 10, 1997.

      3. To the extent that, at the end each calendar quarter, any money remain
after all costs and expenses at ACL are paid as determined by the management of
ACL in their sole and absolute discretion, including without limitation,
employee salaries and the Royalty set forth in Paragraph 2, above (the
"Available Funds"), ACL shall at the end of each calendar quarter pay Smallwood
an amount (in addition to the Royalty) equal to the sum of the following
amounts; (a) $71,250.00, until a total of $285,000 is paid to Smallwood
pursuant to this clause (a), plus (b) all increase, if any, due Price and Walsh
under the Notes as of to end of such calendar quarters until the Notes are
entirely paid in full, plus (c) $75,000.00, until a total if $300,000.00 is paid
to Smallwood pursuant to this clause (c) of this Paragraph 3 by January 10,
1997, nine percent (9.0%) per annum interest beginning on January 11, 1997, on
any outstanding amount due Smallwood under clause (c) of this Paragraph 3. If,
at the end of a calendar quarter, such remaining Available Funds are less than
the entire amounts due Smallwood under clauses (a), (b), (c) and (d) of this
Paragraph 3, then ACL shall pay Smallwood pro rata portions of the amounts
otherwise due under such clauses (a), (b), (c), and (d), which portions when
combined equal such remaining Available Funds. Notwithstanding the foregoing,
ACL shall not be required to pay Smallwood any amount further under the
foregoing clauses (a) and (c) of this Paragraph 3 once all payments made under
such clauses equal or exceed $585,000.00. However, the payments under clause (b)
shall remain until such time as the Notes are paid in full.

                                       2
<PAGE>

      4. All amounts (including the Royalty) to be paid by ACL to Smallwood
under this Assumption and Agreement shall be payable within ten (10) calendar
days after the end of each calendar quarter and shall be reconciled annually to
audited records of ACL within (90) days after the end of each calendar year.
Smallwood shall have the right to examine the books and records of ACL to
determine the accuracy of all payments under this Assumption and Agreement, upon
reasonable request and subject to reasonable confidentiality arrangements. The
royalties payable under this Assumption and Agreement shall be in addition to
any other consulting fees, salaries, other royalties or other amounts that may
be paid or payable to Smallwood for services to ACL.

      5. The rights and obligations of ACL under this Assumption and Agreement
shall be binding upon and inure to the successors and permitted assigns of ACL.
Smallwood agrees that ACL may assign its obligations under this Assumption and
Agreement to Logic Laboratories, Inc., a Delaware corporation. Except as
provided in the foregoing sentence, this Assumption and Agreement may not be
assigned by either Party without the written consent of the other Party.

      6. As used in this Assumption and Agreement, "Royalty Revenue" means gross
revenue actually received by ACL, prior to any deductions for any expenses of
ACL including without limitation taxes, rents, and employee salaries and
bonuses, if any, but after deductions for rebates, warranties, tariffs, and
other shipping costs, from the domestic and international sale, licensing,
manufacturing and any other sources if income to ACL resulting from the
technology evidenced by the patents on Exhibit B attached hereto (the
"Patents"). The Parties acknowledge and agree that not Royalty shall be due
Smallwood hereunder from any income derived by ACL from technology other than
that listed on Exhibit B.

      7. The Royalty due Smallwood hereunder shall terminate on the date which
is the expiration date of the last of the Patents listed on Exhibit B (the
"Royalty Term"). The amount due Smallwood pursuant to Section 3, above, shall
continue until satisfied in full; provided, however, such amounts shall become
due and payable in full immediately upon the merger, consolidation, dissolution,
or sale of substantially all of the assets of Logic Laboratories, Inc., once
this Assumption and Agreement has been assigned to Logic Laboratories, Inc.

      8. This Assumptions and Agreement constitutes the entire agreement between
the Parties with respect to the subject matter hereof and supersedes all prior
agreements, understandings, proposals, offers, negotiations and discussions,
whether oral and written, between the Parties, including without limitation the
Royalty Agreement (which this Assumptions and Agreement amends and restates) and
the Memorandum to Timothy F. Sutherland from Smallwood, Price and Walsh, dated
December 6, 1995, with respect to the subject matter hereof.

      9. This Assumptions and Agreement cannot be amended, modified to
terminated without the written consent of ACL, Smallwood and the holders of the
Notes.

                                       3
<PAGE>

      IN WITNESS WHEREOF, the Parties have caused this Assumptions and Agreement
to be executed on the date first above written

American Compact Lighting, L.L.C.             Robert C. Smallwood, individually

By: /s/ Robert C. Smallwood                   By: /s/ Robert C. Smallwood
   -------------------------------               -------------------------------
Name: Robert C. Smallwood                     Date: Jan. 25, 1996
     -----------------------------                 -----------------------------
Title: Mgr
      ----------------------------
Date: Jan. 25, 1996
     -----------------------------

                                       4

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