Bridge Loan Agreement

BITSTREAM INC.



LOAN AGREEMENT



This is a loan agreement with an effective date of February 22, 1996 by and among Bitstream Inc., a Massachusetts corporation, having its principal executive office at 215 First Street, Cambridge, Mass. 02142 (the "Company"), and the undersigned lenders of the Company ("Lenders").



WHEREAS, The current primary secured lender of the Company is BayBank, N.A. ("BayBank"); and



WHEREAS, The undersigned Lenders wish to lend a total amount of $600,000, each in the amount shown below:



No. Lender Loan Amount

1. Morton E. Goulder $ 16,000



2. David G. Lubrano $ 18,000



3.a. BVB Grantor Retained Income Trust I $ 11,500



3.b. George B. Beitzel $ 11,500



4. Amos Kaminski $ 24,000



5. BancBoston Ventures, Inc. $ 83,000



6. JHI Development Capital Limited $155,000



7. Gotthard Bank (Nassau Branch) $281,000

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Total $600,000



NOW THEREFORE, for good and valuable consideration, the Company hereby adopts and the Lenders hereby agree as follows:



1. Notes.



1.1 The Company shall issue a promissory note (in the form attached

hereto Exhibit A(1) A(2) A(3a) A(3b) A(4) A(5) or A(6) with respect to the

Lender to which it applies) to each of the Lenders (except Gotthard Bank)

for the amount set for to his name above.



1.2 Gotthard Bank Note. The form of note attached hereto as A(7) shall

be the form of note used for Gotthard Bank ("Gotthard"), the Loan Agreement Page 2 Bitstream Inc. Effective Date: February 22, 1996









terms of which shall differ from notes A(1) through A(6) only in respect to

the inclusion of registration provisions.



2. Gotthard Registration Provisions. The following registration provisions shall bind only the Company and Gotthard:



2.1. Registration, Transfer and Exchange of Promissory Notes Payable

to Gotthard. The promissory note issued to Gotthard (the "Gotthard Note")

shall be registered as herein provided.:



2.1.1. The Company shall keep at its principal executive office,

or any other place of which the Company shall have given notice to

Gotthard, appropriate books for the registration of the Gotthard Note

and transfers thereof, and at such office the Company, under such

reasonable regulations as it may prescribe but at its own expense

(other than transfer taxes, if any), will register the Gotthard Note,

and transfers thereof.



2.1.2. No transfer of the Gotthard Note shall be registered

unless evidenced by a written instrument of transfer in form

reasonably satisfactory to the Company, duly executed by the

registered owner or by his duly authorized attorney-in-fact.



2.2. Withholding Tax. Gotthard and each registered assign of Gotthard

that is organized under the laws of any jurisdiction other than the United

States of America or any political subdivision thereof hereby represents

and warrants to the Company that:



(i) the Company's payments to Gotthard and such assign of all

amounts payable under the Gotthard Note or pursuant to this Agreement

are not subject to any United States federal income withholding taxes

("Withholding Taxes") as of the date hereof (or, in the case of a

registered assign, on the date such registered assign becomes the

registered holder of the Gotthard Note), and



(ii) from time to time, as and when requested by the Company,

Gotthard and each such registered assign shall execute and deliver to

the Company any and all Internal Revenue Service forms, and shall

provide the Company with any information, necessary to establish

Gotthard's or such registered assign's continued exemption from

Withholding Taxes under Section 35a.39999-(b) of the United States

Treasury Regulations.



If Withholding Taxes are imposed upon the Company other than as a result

off any act or omission to act on the part of Gotthard, the Loan Agreement Page 3 Bitstream Inc. Effective Date: February 22, 1996









Company shall either (x) on 15 days' prior written notice, prepay to the

date of payment the principal together with accrued interest (and the

applicable prepayment penalty) of any Gotthard Note held by a party subject

to Withholding Taxes prior to th ...