EXHIBIT 10.30


                 FOURTH AMENDMENT TO LOAN AND SECURITY AGREEMENT


         This Fourth  Amendment  to Loan and  Security  Agreement is dated as of
July 28, 1997 (this "Amendment") by and among:

Summit Bank,  f/k/a United Jersey Bank, f/k/a United Jersey  Bank/Central,  N.A.
(the "Bank"), a New Jersey banking corporation having an address at 301 Carnegie
Center, CN 5316, Princeton, New Jersey 08543-5316; and,

Osteotech,  Inc. (the "Borrower"),  a Delaware  corporation having its principal
place of business at 51 James Way, Eatontown, New Jersey 07724.

                                    RECITALS:

         WHEREAS,  pursuant to the terms of a Loan and Security  Agreement dated
May 27,  1993 (the "Loan  Agreement"),  the Bank  provided a  $4,000,000  credit
facility  (the  "Credit  Facility")  to the  Borrower,  including  a  $2,000,000
Revolving Loan and a $2,000,000 Equipment Loan; and,

         WHEREAS,  pursuant  to a  First  Amendment  to the  Loan  and  Security
Agreement  dated July 14, 1994 (the "First  Amendment"),  the Bank,  among other
things,  extended the term of the Credit  Facility to May 31, 1995 and increased
the amount to the Credit Facility to $6,000,000.00; and,

         WHEREAS,  pursuant  to a Second  Amendment  to the  Loan  and  Security
Agreement dated June 30, 1995 (the "Second  Amendment"),  the Bank,  among other
things, extended the term of the Credit Facility to May 31, 1996; and,

         WHEREAS,  pursuant  to a  Third  Amendment  to the  Loan  and  Security
Agreement  dated May 31, 1996 (the  "Third  Amendment"),  the Bank,  among other
things,  extended the term of the Credit  Facility to May 31, 1997 and increased
the amount the Credit Facility to $7,000,000.00; and

         WHEREAS,  the term of the Credit  Facility  expired on May 31, 1997 and
the Borrower  has  requested  to extend the term of the Credit  Facility,  among
other  things,  and the  Bank has  agreed  to do so  subject  to the  terms  and
conditions set forth herein.


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         NOW  THEREFORE,  in  consideration  of  the  recitals  and  the  mutual
covenants  contained herein and in the other  agreements  executed in connection
with the Credit Facility, the parties hereto agree as follows:1. Notwithstanding
anything to the contrary contained in the Loan Agreement, the Notes or any other
Fundamental  Document as amended by the First  Amendment,  Second  Amendment  or
Third  Amendment  (the  "Amended  Fundamental  Documents"),  the  terms  of this
Amendment  shall control.  All  capitalized  terms used herein and not otherwise
defined herein shall have the meanings  ascribed to them pursuant to the Amended
Fundamental Documents.

2.       The Loan Agreement is hereby amended as follows:

     (a)  The  following  definitions  are hereby  amended  and  restated in its
          entirety to read as follows:

               "Loan Termination Date" means May 31, 1998.

                  "Notes" means,  collectively,  the promissory note made by the
                  Borrower in favor of the Bank,  in a  principal  amount not to
                  exceed Four Million  Dollars  ($4,000,000.00)  evidencing  the
                  Borrower's   Obligations  to  the  Bank  in  connection   with
                  Equipment  Advances  and  the  promissory  note  made  by  the
                  Borrower in favor of the Bank,  in a  principal  amount not to
                  exceed Three Million  Dollars  ($3,000,000.00)  evidencing the
                  Borrower's   Obligations  to  the  Bank  in  connection   with
                  Revolving Loan Advances.

         (b)      The following definitions are added:

                  "Base  Rate  Advance"  means an  Advance  which  the  Borrower
                  requests to be made as an Advance  which will accrue  interest
                  at the Base Rate in accordance  with the provisions of Section
                  2.06 hereof.

                    "Equipment Advance Application" has the meaning set forth in
                    Section 2.03(a).

                  "Eurodollar  Advance"  means an  Advance  which  the  Borrower
                  requests to be made as an Advance  which will accrue  interest
                  at the  Eurodollar  Rate or which is  reborrowed as an Advance
                  with a Eurodollar  Rate, in accordance  with the provisions of
                  Section 2.06 hereof.

                  "Eurodollar   Advance  Period"  means,   for  each  Eurodollar
                  Advance,  each one, two, or three month period, as selected by
                  the Borrower pursuant to Section 2.06 hereof, during which the
                  applicable    Eurodollar   Rate   shall   remain    unchanged.
                  Notwithstanding the foregoing, however:

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                  (i) any  applicable  Eurodollar  Advance  Period  which  would
                  otherwise  end on a day which is not a  Business  Day shall be
                  extended  to the next  succeeding  Business  Day,  unless such
                  Business Day falls in another  calendar  month,  in which case
                  such  Eurodollar  Advance  Period  shall end on the  preceding
                  Business Day; (ii) any  applicable  Eurodollar  Advance Period
                  which  begins  on a day  for  which  there  is no  numerically
                  corresponding  day in the  calendar  month  during  which such
                  Eurodollar  Advance  Period is to end shall (subject to clause
                  (i) above)  end on the last day of such  calendar  month;  and
                  (iii) no  Eurodollar  Advance  Period shall extend  beyond the
                  Loan  Termination Date or such earlier date as would interfere
                  with the repayment obligations of the Borrower under Section 2
                  hereof.  "Eurodollar Basis" means, a simple per annum interest
                  rate equal to the quotient of (i) the Eurodollar  Rate divided
                  by (ii) one minus the Eurodollar Reserve  Percentage,  if any,
                  stated as a decimal.  The  Eurodollar  Basis  shall be rounded
                  upward to the nearest  one  sixteenth  of one percent  (1/16%)
                  and,  once  determined,  shall  remain  unchanged  during  the
                  applicable  Eurodollar  Advance Period,  except for changes to
                  reflect adjustments in the Eurodollar Reserve Percentage.

               "Eurodollar Margin" has the meaning set forth in Section 2.06(b).

                  "Eurodollar Rate" means for any Eurodollar Advance Period, the
                  average  (rounded  upward to the nearest one  sixteenth of one
                  percent  (1/16%))  of the  interest  rates  per annum at which
                  deposits in United States dollars for such Eurodollar  Advance
                  Period  are  offered to prime  banks in the  London  interbank
                  market  as   reported   on   Telerate   Screen  page  3750  at
                  approximately  11:00 a.m. (Eastern Time) two (2) Business Days
                  before the first day of such Eurodollar  Advance Period, in an
                  amount approximately equal to the principal amount of, and for
                  a length of time approximately equal to the Eurodollar Advance
                  Period for, the Eurodollar Advance sought by the Borrower.  If
                  such rate is not so  reported,  then such rate as  reported by
                  any other  internationally  recognized reporting service shall
                  be  selected  by the  Bank or,  if no such  other  service  is
                  available,  such rate shall be determined by the Bank based on
                  rate information furnished to it by two or more banks selected
                  by it which participate in the market for such deposits.

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<PAGE>
                  "Eurodollar  Reserve Percentage" means the percentage which is
                  in effect from time to time under Regulation D of the Board of
                  Governors of the Federal  Reserve  System,  as such regulation
                  may be  amended  from  time to time,  as the  maximum  reserve
                  requirement    applicable   with   respect   to   Eurocurrency
                  Liabilities (as that term is defined in Regulation D), whether
                  or not the Bank has any  Eurocurrency  Liabilities  subject to
                  such reserve  requirement at that time.  The Eurodollar  Basis
                  for  any  Eurodollar  Advance  shall  be  adjusted  as of  the
                  effective date by the same effective basis point change of any
                  change in the Eurodollar  Reserve  Percentage.  "Payment Date"
                  means the last day of each  Eurodollar  Advance  Period  for a
                  Eurodollar Advance.

     (c)  Section  2.02(b) is hereby  amended and  restated  in its  entirety as
          follows:

                  (b) Each  Revolving  Loan Advance  shall be made on telephonic
                  notice  given by the  Borrower  to the Bank and  confirmed  by
                  telefax from the Borrower and received by the Bank before 3:00
                  p.m.  EST at telefax  number  741-0341.  Each such notice of a
                  Revolving  Loan  Advance (a "Notice  of  Advance")  shall be a
                  signed  writing by the  Borrower  specifying  therein  (i) the
                  requested  Advance Date, (ii) the amount of such advance,  and
                  (iii)  whether  the  Advance  is  a  Base  Rate  Advance  or a
                  Eurodollar Advance, as defined in Section 2.06. Such Notice of
                  Advance  must be  received  by the Bank not later  than  11:00
                  a.m.,  EST, on the second  Business  Day prior to the proposed
                  Advance Date.

     (d)  Sections  2.06 is hereby  amended and  restated  in their  entirety as
          follows:

                  Section 2.06.     Interest Rates.

               (a)  Choice of Interest Rate. Any Advance shall, at the option of
                    the  Borrower and  pursuant to the terms and  conditions  of
                    this  Agreement,  be made either as a Base Rate Advance or a
                    Eurodollar Advance.


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<PAGE>

               (b)  Interest Rate on Revolving Loan Advances. All amounts due to
                    the Bank in connection with the Revolving Loan Advance shall
                    bear  interest  during each calendar  month  pursuant to the
                    Borrower's   Notice  of  Advance  either  at  a  fluctuating
                    interest  rate per annum equal at all times to the Base Rate
                    in  effect  from time to time,  or two  hundred  (200)  base
                    points greater than the Eurodollar  Rate in effect from time
                    to time ("Eurodollar Margin").

               (c)  Interest Rate on Equipment Advances.  All amounts due to the
                    Bank  in  connection  with  Equipment  Advances  shall  bear
                    interest   during  each  calendar   month  pursuant  to  the
                    Borrower's  Equipment  Advance  Application at a fluctuating
                    interest  rate per annum equal at all times to the Base Rate
                    in effect from time to time or the Eurodollar Margin.

               (d)  Changes in Interest Rates.  Each change in such  fluctuating
                    interest   rates   referred   to  above  shall  take  effect
                    simultaneously  with the  corresponding  change in such Base
                    Rate or  Eurodollar  Rate  without  notice to the  Borrower.
                    Interest  shall  be  calculated  on a daily  basis  upon the
                    unpaid balance with each day representing 1/360th of a year.
          
               (e) Eurodollar Advances.

                                    (i)   Initial  and   Subsequent   Eurodollar
                  Advances.  The Bank, whose  determination shall be conclusive,
                  shall  determine the  Eurodollar  Basis as of the Business Day
                  prior to the date of the requested  Advance and shall promptly
                  notify  the  Borrower  of the  same  and  the  Borrower  shall
                  promptly confirm in writing receipt of such notification.  The
                  Eurodollar Advance Period for each Eurodollar Advance shall in
                  all events be either thirty, sixty or ninety days, as selected
                  by the Borrower pursuant to the Notice of Advance or Equipment
                  Advance Application ("Eurodollar Advance Period").

                                    (ii)    Procedures    After   Repayment   of
                  Eurodollar  Advance. At least three (3) Business Days prior to
                  each Payment Date for a Eurodollar Advance, the Borrower shall
                  give the  Bank  written  notice  specifying  whether  all or a
                  portion of any Eurodollar  Advance  outstanding on the Payment
                  Date (a) is to be repaid  and then  reborrowed  in whole or in
                  part as a new  Eurodollar  Advance,  in which case such notice
                  shall also  specify the  Eurodollar  Advance  Period which the
                  Borrower shall have selected for such

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<PAGE>
                  new  Eurodollar  Advance,   (b)  is  to  be  repaid  and  then
                  reborrowed in whole or in part as a Base Rate Advance,  or (c)
                  is to be repaid and not  reborrowed.  Upon such  Payment  Date
                  such  Eurodollar  Advance  will,  subject  to  the  provisions
                  hereof, be so repaid and, as applicable, reborrowed.

                                    (iii) Limitations as to Eurodollar Advances.
                  Requests for  Eurodollar  Advances may be made daily (but only
                  once  a  day)  provided  the  Borrower  satisfies  all  notice
                  requirements as provided for herein.

                                    (iv) Reimbursement.  Whenever the Bank shall
                  actually  incur any losses or actual  expenses  in  connection
                  with (i)  failure by the  Borrower  to borrow  any  Eurodollar
                  Advance  after having given notice of its  intention to borrow
                  (whether  by reason of the  election  of the  Borrower  not to
                  proceed or the non-fulfilment of any conditions precedent), or
                  (ii) prepayment of any Eurodollar Advance in whole or in part,
                  for any reason,  the Borrower  agrees to pay to the Bank, upon
                  the Bank's demand, an amount sufficient to compensate the Bank
                  for  all  such  losses  and  actual  expenses  excluding  lost
                  profits. Bank's good faith determination of the amount of such
                  losses and actual  expenses,  absent manifest error,  shall be
                  binding and  conclusive.  The Bank shall provide a copy of the
                  determination  of  such  amount  to the  Borrower  showing  in
                  reasonable detail the calculation of the amount thereof.

                  (f)      General Provisions as to Eurodollar Advances.

               (i)  Unavailability.  Notwithstanding  anything  contained herein
which  may be  construed  to the  contrary,  if  with  respect  to any  proposed
Eurodollar  Advance for any Eurodollar  Advance Period, the Bank determines that
deposits in dollars (in the applicable amount) are not being offered to the Bank
in the  relevant  market  for such  Eurodollar  Advance  Period,  the Bank shall
forthwith give notice thereof to the Borrower, whereupon until the Bank notifies
the  Borrower  that the  circumstances  giving rise to such  situation no longer
exist,  the  obligations  of the  Bank  to make  Eurodollar  Advances  shall  be
suspended.

               (ii) Illegality.  If any applicable law, rule, or regulation,  or
any  change  therein,  or any  interpretation  or  change in  interpretation  or
administration  thereof  by  any  governmental   authority,   central  bank,  or
comparable agency charged with the interpretation or administration  thereof, or
compliance  by Bank with any  request or  directive  (whether  or not having the
force of law) of any such authority,  central bank, or comparable agency,  shall
make it unlawful

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or impossible for Bank to make, maintain, or fund its Eurodollar Advances,  Bank
shall  forthwith  give notice to the  Borrower.  Before giving any notice to the
Borrower pursuant to this Section 2.06(f),  the Bank shall designate a different
lending  office if such  designation  will avoid the need for giving such notice
and will not,  in the  reasonable  judgment  of Bank,  be  otherwise  materially
disadvantageous to Bank. Upon receipt of such notice,  notwithstanding  anything
contained  in  Section  2,  the  Borrower  shall  repay  Bank in full  the  then
outstanding principal amount of each affected Eurodollar Advance,  together with
accrued  interest  thereon,  either  (a) on the  last  day of the  then  current
Eurodollar  Advance Period applicable to such Eurodollar Advance to such day, or
(b)  immediately  if Bank may not lawfully  continue to fund and  maintain  such
Eurodollar  Advance to such day; provided,  however,  that  notwithstanding  any
provision contained in this Agreement to the contrary, the Borrower shall not be
required  to  compensate  Bank for any  losses,  including  any loss or expenses
incurred by reason of the  liquidation,  reemployment of deposits or other funds
acquired to obtain the  Eurodollar  Advance,  incurred as a  consequence  of any
required  conversion  of  a  Eurodollar  Advance  to  a  Base  Rate  Advance  as
hereinafter  provided,  as a result of the events described in this Section 2.6.
Concurrently   with  repaying  each   affected   Eurodollar   Advance  of  Bank,
notwithstanding  anything  contained in Section 2, the  Borrower  shall borrow a
Base Rate  Advance  from Bank,  and Bank shall make such loan in an amount  such
that the outstanding  principal  amount of the Note held by Bank shall equal the
outstanding principal amount of such Note immediately prior to such repayment.

               (iii)   Increased Costs.

          (1) If, after the date hereof, any applicable law, rule or regulation,
     or any change therein, or any interpretation or change in interpretation or
     administration  thereof by any  governmental  authority,  central  bank, or
     comparable agency charged with the interpretation or administration thereof
     or compliance by Bank with any request or directive  (whether or not having
     any such authority), shall:

     (A) subject  Bank to any tax,  duty,  or other  charge with  respect to its
obligations to make Eurodollar  Advances,  or shall change the basis of taxation
of payments to Bank of the principal of or interest on its  Eurodollar  Advances
or in respect of any other  amounts due under this  Agreement  in respect of its
Eurodollar  Advances or its obligation to make Eurodollar  Advances  (except for
taxes  imposed  upon or measured by net income or  alternative  minimum  taxable
income or taxable  assets in lieu of income imposed by the United States and the
jurisdiction in which Bank's principal executive office is located); or

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<PAGE>
     (B) impose,  modify, or deem applicable with respect to the making, funding
or  maintaining  any  Advance  hereunder,   any  reserve   (including,   without
limitation, any imposed by the Board of Governors of the Federal Reserve System,
but  excluding  any included in an applicable  Eurodollar  Reserve  Percentage),
special deposit, capital adequacy, assessment, or other requirement or condition
against assets of, deposits with or for the account of, or commitments or credit
extended by Bank, or shall impose on Bank or the Eurodollar  interbank borrowing
market or any other  condition  affecting its obligation to make such Eurodollar
Advances; and the result of any of the foregoing is to increase the cost to Bank
of making or maintaining any such Eurodollar  Advances,  or to reduce the amount
of any sum  received or  receivable  by Bank under this  Agreement  or under its
Notes  with  respect  thereto,  and such  increase  is not  given  effect in the
determination  of the  Eurodollar  Rate then, on the earlier of thirty (30) days
after written demand by Bank or the Loan  Termination  Date, the Borrower agrees
to pay to  Bank  such  additional  amount  or  amounts  as  Bank  determines  is
attributable to making, funding and maintaining its Eurodollar Advances provided
that Bank  provides  notice to the Borrower of such amount within 90 days of the
date of the actual  knowledge of Bank of the occurrence of the event giving rise
to such cost.  Bank will  promptly  notify the Borrower of any event of which it
has  knowledge,  occurring  after the date  hereof,  which will  entitle Bank to
compensation pursuant to this Section 2.6 and will designate a different lending
office if such  designation  will  avoid the need for,  or reduce the amount of,
such compensation and will not, in the reasonable judgment of Bank, be otherwise
materially disadvantageous to Bank.

          (2) A  certificate  of Bank claiming  compensation  under this Section
     2.6(f) and setting forth the additional  amount or amounts to be paid to it
     hereunder and  calculations  therefor shall be conclusive in the absence of
     manifest  error.  In determining  such amount,  Bank may use any reasonable
     averaging and  attribution  methods and shall calculate such sums in a fair
     and  reasonable  manner.  If Bank demands  compensation  under this Section
     2.6(f), the Borrower may at any time, upon at least five (5) Business Days'
     prior  notice  to  Bank,  prepay  in full  the  then  outstanding  affected
     Eurodollar  Advances of Bank, together with accrued interest thereon to the
     date of prepayment.  Concurrently  with prepaying such Eurodollar  Advances
     the Borrower shall borrow a Base Rate Advance,  or a Eurodollar Advance not
     so affected,  from Bank, and Bank shall make such Advance in an amount such
     that the outstanding principal amount of the Notes held by Bank shall equal
     the outstanding  principal amount of such Notes  immediately  prior to such
     prepayment.


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<PAGE>
               (iv) Effect On Other Advances.  If notice has been given pursuant
          to Section  2.6(f)(iii),  suspending  the obligation of Bank to make a
          Eurodollar  Advance,  or requiring  Eurodollar  Advances of Bank to be
          repaid or prepaid,  then,  unless and until Bank notifies the Borrower
          that the circumstances  giving rise to such repayment no longer apply,
          all  Loans  which  would  otherwise  be made  by  Bank to the  type of
          Eurodollar Advances affected shall, at the option of the Borrower,  be
          made instead as Base Rate Advances.

           (g) Base Rate Advances.

     (i) Procedure to Convert Base Rate Advance to Eurodollar Advance.  Borrower
may at any time or from  time to time,  so long as no Event of  Default  exists,
convert a Base Rate  Advance to a  Eurodollar  Advance  upon at least  three (3)
Business Days written notice to the Bank.  Such written notice shall specify (A)
the  specific  amount of the Base Rate  Advance  which  will be  converted  to a
Eurodollar  Advance,  (B) the applicable  Eurodollar Advance Period, and (C) the
date of conversion  of the Base Rate Advance to a Eurodollar  Advance (such date
of conversion  shall be at least three (3) days  following the written notice by
Borrower pursuant to this subsection).

3.  Except as  expressly  otherwise  provided  herein,  the terms of the Amended
Fundamental Documents shall remain in full force and effect and are incorporated
herein  by  reference.  In the  event of a  conflict  between  the terms of this
Amendment  and  any  other  Amended  Fundamental  Document,  the  terms  of this
Amendment shall control.

4. The Borrower acknowledges that the Bank has no obligation to make any further
amendments to the Amended Fundamental  Documents or any other agreement executed
in  connection  therewith.  The  Borrower  further  acknowledges  that it has no
defenses to any of its  obligations to the Bank and represents  that no Event of
Default has occurred.

5.  The  Borrower  shall  be  liable  for  all  reasonable  costs  and  expenses
(comprising  legal fees and  disbursements)  incurred by the Bank in  connection
with this  Amendment,  and shall promptly pay or reimburse the Bank for all such
costs.

6. This Amendment  shall be construed in accordance  with, and shall be governed
by, the laws of the State of New Jersey,  without reference to the choice of law
doctrine of such state. Except as otherwise expressly set forth herein,  nothing
in this  Amendment  shall be construed as a waiver or release by the Bank of any
rights or remedies of the Bank.  This Amendment  shall be binding upon and inure
to the  benefit  of the  parties  hereto  and their  respective  successors  and
assigns.

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<PAGE>

IN WITNESS  WHEREOF,  the  undersigned  have set their hands and seals or caused
this Fourth  Amendment  to Loan and  Security  Agreement to be executed by their
proper  corporate  officers  and sealed with their seal  effective as of May 31,
1997.


ATTEST:                                           OSTEOTECH, INC.


/s/ STEVEN SOBIESKI                      BY:  /s/ MICHAEL J. JEFFRIES
-------------------                           -----------------------
NAME:  Steven Sobieski                    Michael J. Jeffries, Exec. V.P.
       Vice President Finance             COO & CFO


ATTEST:                                           SUMMIT BANK


/s/ JOHN F. GANNING                      By:  /s/ DAVID M. NILSEN
-------------------                            -------------------
Name:  John F. Ganning             Name:     David M. Nilsen
        Vice President                       Title:  Vice President


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