Document:

Exhibit 10.53

[The Fifth Modification of Lease dated October 16, 1996 was previously filed as
an exhibit to Osteotech's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996. The Sixth Modification of Lease dated August 11, 1998 was
previously filed as an exhibit to Osteotech's Quarterly Report on Form 10-Q for
the quarter ended September 30, 1998.]

                          FOURTH MODIFICATION OF LEASE

     AGREEMENT, made this 30 day of January, 1992, by and between ROBERT C.
BAKER, GERALD H. BAKER, HARVEY B. OSHINS, BAKER 1985 FAMILY PARTNERSHIP, GREGORY
J. STEPIC and JOHN G. ORRICO, having their office and Post Office Address c/o
National Realty & Development Corp., 3 Manhattanville Road, Purchase, New York
10577 (hereinafter referred to as "Landlord") and OSTEOTECH INC., a Delaware
corporation, having an office at 1151 Shrewsbury Avenue, Shrewsbury, New Jersey
07702 (hereinafter referred to as "Tenant").

                              W I T N E S S E T H:

     WHEREAS, on or about August 18, 1986, a lease was entered into between
Landlord and Tenant, respecting certain premises (hereinafter referred to as the
"DEMISED PREMISES") within the building commonly known as 1151 Shrewsbury Avenue
in the BOROUGH OF SHREWSBURY, COUNTY OF MONMOUTH and STATE OF NEW JERSEY; and

     WHEREAS, said lease was modified by First Modification of Lease dated May
31, 1989, Second Modification of Lease dated December 22, 1989 and Third
Modification of Lease dated June 21, 1991 between Landlord and Tenant (said
lease as modified is hereinafter referred to as the "Lease"); and

     WHEREAS, Tenant is desirous of leasing from Landlord and Landlord is
desirous of leasing to Tenant certain additional premises within the Center (as
defined in the Lease) in the building commonly known as 1163 Shrewsbury Avenue,
Shrewsbury, New Jersey located within Lot No. 3/1; and

     WHEREAS, the parties hereto desire to further modify the Lease in certain
respects as hereafter provided.

     NOW, THEREFORE, in consideration of ONE AND 00/100 ($1.00) DOLLAR and other
good and valuable consideration, each to the other in hand duly paid, the
receipt and sufficiency whereof is hereby acknowledged, it is mutually agreed as
follows:

     1. As of the Effective Date (as hereinafter defined), the Plot Plan
presently annexed to the Lease as Exhibit "A" is hereby supplemented by adding
as a part of said Plot Plan Exhibit A-1 annexed hereto. The attached Exhibit A-1
shows an area consisting of approximately 6,000 square feet located in the
building known as 1163 Shrewsbury Avenue situated within Lot No. 3/1, which area
is cross-hatched on Exhibit "A-1" and is hereafter referred to as the
"Additional Premises." Upon the Effective Date, the Additional Premises shall be
deemed to be part of the Demised Premises, as if originally included within the
Demised Premises, as the same is defined by the Lease. The overall square
footage of the Demised Premises shall be increased to approximately 28,960
square feet. Tenant has examined the Additional Premises and has made a complete
inspection of the same and is familiar with the physical condition thereof as of
this date. Landlord has not made and does not make any representation as to the
physical condition or any other matter affecting or relating to the Additional
Premises except as provided below.

<PAGE>

Tenant agrees to accept the Additional Premises "as is", except that Landlord
agrees that the Additional Premises shall be delivered to Tenant in clean
condition and Landlord shall repair any damage caused by the vacating of the
Additional Premises by the former tenant.

     2. The Effective Date shall be the date upon which Landlord delivers
possession of the Additional Premises to Tenant.

     3. From and after that date which is eight (8) months following the
Effective Date, the annual minimum rental payable pursuant to Article 3 of the
Lease, and in accordance with and subject to the provisions of the Lease, shall
be increased to TWO HUNDRED SIXTEEN THOUSAND ONE HUNDRED FIFTY TWO AND 30/100
($216,152.30) DOLLARS per annum - EIGHTEEN THOUSAND TWELVE AND 69/100
($18,012.69) DOLLARS per month.

     4. Notwithstanding anything to the contrary contained therein, Section
31.01 of the Lease is hereby modified to provide that for the purposes of this
Lease, as of the Effective Date, 10,697 square feet is deemed to be leased as
office space and 18,263 square feet is deemed to be leased as non-office or
processing space.

     5. Tenant acknowledges that, as of the Effective Date, Tenant's
proportionate share of additional rent payable under the Lease shall be
adjusted, pursuant to the terms of the Lease, to reflect the increase in the
square footage of the Demised Premises.

     6. Except as expressly modified herein, all of the provisions, covenants,
conditions and agreements set forth in the Lease shall continue in full force
and effect.

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<PAGE>

     IN WITNESS WHEREOF, the parties have caused this Fourth Modification of
Lease to be executed as of the day and year first above written.

                                          /s/ Robert C. Baker
                                          --------------------------------------
                                          ROBERT C. BAKER Individually and as
                                          Managing General Partner of Baker 1985
                                          Family Partnership

                                          /s/ Harvey B. Oshins
                                          --------------------------------------
                                          HARVEY B. OSHINS

                                          /s/ Gerald H. Baker
                                          --------------------------------------
                                          GERALD H. BAKER

                                          /s/ Gregory J. Stepic
                                          --------------------------------------
                                          GREGORY J. STEPIC

                                          /s/ John G. Orrico
                                          --------------------------------------
                                          JOHN G. ORRICO

ATTEST:                                   OSTEOTECH INC.

/s/ Patricia Tiebolt                      By: /s/ Michael J. Jeffries
------------------------                  --------------------------------------
ASST. SECRETARY                               SR. VICE PRESIDENT

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<PAGE>

STATE OF NEW YORK         )
                          SS:
COUNTY OF WESTCHESTER     )

     BE IT REMEMBERED, that on this 31 day of January, 1992 before me, the
subscriber personally appeared ROBERT C. BAKER, Individually and as Managing
General Partner for Baker 1985 Family Partnership, HARVEY B. OSHINS, and GREGORY
J. STEPIC, who I am satisfied are the persons named in and who signed the within
instrument, and, thereupon they acknowledged that they signed, sealed and
delivered the same as their act and deed, for the uses and purposes therein
expressed.

                                          /s/ Monique St. Hilaire
                                          --------------------------------------
                                          NOTARY PUBLIC
                                                  Monique St. Hilaire
                                            Notary Public, State of New York
                                                      No. 4974682
                                            Qualified in Westchester County
                                          Commission Expires November 19, 1992
STATE OF NEW JERSEY       )
                          SS:
COUNTY OF HUDSON          )

     BE IT REMEMBERED, that on this 3 day of February, 1992, before me, the
subscriber personally appeared GERALD H. BAKER, who I am satisfied is the person
named in and who signed the within instrument, and, thereupon he acknowledged
that he signed, sealed and delivered the same as his act and deed, for the uses
and purposes therein expressed.

                                          /s/ Dianne Williamson
                                          --------------------------------------
                                          NOTARY PUBLIC
                                                    DIANNE WILLIAMSON
                                              A Notary Public of New Jersey
                                            My Commission Expires May 7, 1996
STATE OF NEW JERSEY       )
                          SS:
COUNTY OF MONMOUTH        )

      BE IT REMEMBERED, that on this 30 day of January, 1992, before me, the
subscriber, A Notary Public of the State of New Jersey, personally appeared
Michael J. Jeffries, Sr. Vice President of OSTEOTECH INC. who, I am satisfied,
is the person who signed the within instrument; and I having first made known to
him the contents thereof, he thereupon acknowledged that he signed, sealed with
the corporate seal, and delivered the said instrument as such officer aforesaid,
and that the within instrument is the voluntary act and deed of said
corporation, made by virtue of the authority of its board of directors.

                                          /s/ Dawn E. Thompson
                                          --------------------------------------
                                          NOTARY PUBLIC
                                                     DAWN E. THOMPSON
                                               Notary Public of New Jersey
                                           My Commission Expires Nov. 17, 1992

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<PAGE>

                                   Exhibit A-1

           Diagram/Map of the Plot Plan of 1163 Shrewsbury Avenue.

                                       5Exhibit 10.54

                               INDEMNITY AGREEMENT

     Agreement dated as of the ____ day of _________, 2002 by and between
Osteotech, Inc., a Delaware corporation (the "Corporation"), and
_________________ ("Indemnitee").

     Indemnitee currently is serving as a director and officer/an officer of the
Corporation, and the Corporation desires that Indemnitee continue to serve in
such capacity/capacities. Indemnitee is willing to continue to serve in such
capacity/capacities if Indemnitee is adequately protected against the risks
associated with such service.

     The Corporation and Indemnitee have concluded that the indemnities
available under the Corporation's by-laws need to be supplemented to more fully
protect Indemnitee against the risks associated with Indemnitee's service to the
Corporation.

     In consideration of the premises and of the mutual agreements hereinafter
set forth, the parties hereto agree as follows:

     1. The Corporation shall pay on behalf of the Indemnitee and Indemnitee's
executors, administrators or assigns, any amount that Indemnitee is or becomes
legally obligated to pay as a result of any claim or claims made against
Indemnitee by reason of the fact that Indemnitee served as a director and
officer/an officer of the Corporation or any Affiliate thereof or because of any
actual or alleged breach of duty, neglect, error, misstatement, misleading
statement, omission or other act done, or suffered or wrongfully attempted by
Indemnitee in Indemnitee's capacities as a director and officer/an officer of
the Corporation or any Affiliate thereof. For purposes of this Agreement, the
term "Affiliate" shall mean any corporation controlling, controlled by or under
common control with the Corporation. The payments that the Corporation will be
obligated to make hereunder shall include (without limitation) damages,
judgments, settlements, costs and expenses of investigation, costs and expenses
of defense of legal actions, claims and proceedings and appeals therefrom, and
costs of attachments and similar bonds; provided, however, that the Corporation
shall not be obligated to pay fines or other

<PAGE>

obligations or fees imposed by law or otherwise that it is prohibited from
paying as indemnity by applicable law or for any other reason.

     2. Costs and expenses (including, without limitations, attorneys' fees)
incurred by Indemnitee in defending or investigating any action, suit,
proceeding or claim referred to in Section 1 hereof shall be paid by the
Corporation in advance of the final disposition of such matter upon receipt of a
written undertaking by or on behalf of Indemnitee to repay any such amounts if
it is ultimately determined that Indemnitee is not entitled to indemnification
under the terms of this Agreement.

     3. If a claim under this Agreement is not paid by or on behalf of the
Corporation within ninety days after a written claim has been received by the
Corporation, Indemnitee may at any time thereafter bring suit against the
Corporation to recover the unpaid amount of the claim and, if successful in
whole or in part, Indemnitee shall also be entitled to be paid the expense of
prosecuting such claim.

     4. In the event of payment under this Agreement, the Corporation shall be
subrogated to the extent of such payment to all of the rights of recovery of
Indemnitee, who shall execute all papers required and shall do everything that
may be necessary to secure such rights, including the execution of such
documents necessary to enable the Corporation effectively to bring suit to
enforce such rights.

     5. The Corporation shall not be liable under this Agreement to make any
payment in connection with any claim made against Indemnitee:

     a)   for which payment is actually made to Indemnitee under an insurance
          policy maintained by the Corporation, except in respect of any excess
          beyond the amount of payment under such insurance;

     b)   for which Indemnitee is indemnified by the Corporation otherwise than
          pursuant to this Agreement;

     c)   based upon or attributable to Indemnitee gaining in fact any personal
          profit or advantage to which he was not legally entitled; provided,
          however, that notwithstanding the foregoing, Indemnitee shall be
          protected under this Agreement as to any claims upon which such suit
          may be brought alleging that the Indemnitee gained in fact any
          personal profit or advantage to which he was not legally entitled
          unless a judgment or other final adjudication thereof adverse to

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<PAGE>

          Indemnitee shall establish that Indemnitee gained in fact any personal
          profit or advantage to which he was not legally entitled;

     d)   for an accounting or profits made from the purchase or sale by
          Indemnitee of securities of the Corporation within the meaning of
          Section 16(b) of the Securities Exchange Act of 1934 and amendments
          thereto or similar provisions of any state statutory law or common
          law; or

     e)   brought about or contributed to by the dishonesty of Indemnitee;
          provided, however, that notwithstanding the foregoing, Indemnitee
          shall be protected under this Agreement as to any claims upon which
          suit may be brought alleging dishonesty on the part of Indemnitee,
          unless a judgment or other final adjudication thereof adverse to
          Indemnitee shall establish that Indemnitee committed acts of active
          and deliberate dishonesty with actual dishonest purpose and intent,
          which acts were material to the cause of action so adjudicated.

     6. Indemnitee, as a condition precedent to his right to be indemnified
under this Agreement, shall give to the Corporation notice in writing as soon as
practicable of any claim made for which indemnity will or could be sought under
this Agreement. Notice to the Corporation shall be directed to Osteotech, Inc.,
51 James Way, Eatontown, New Jersey 07724, Attention: Corporate Secretary (or
such other address as the Corporation shall designate in writing to Indemnitee).

     7. Nothing herein shall be deemed to diminish or otherwise restrict
Indemnitee's right to indemnification under any provision of the certificate of
incorporation or by-laws of the Corporation or under Delaware law.

     8. Indemnitee agrees to continue to serve as a director and officer/an
officer of the Corporation to the best of Indemnitee's ability until the
expiration or earlier termination of Indemnitee's term of office or until
Indemnitee tenders his resignation in writing. Notwithstanding the foregoing,
this Agreement shall not be deemed to be a commitment by the Corporation to
employ the Indemnitee.

     9. This Agreement shall be governed by and construed in accordance with
Delaware law.

     10. This Agreement shall be binding upon all successors and assigns of the
Corporation (including any transferee of all or substantially all of its assets
and any successor by

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<PAGE>

merger or operation of law) and shall inure to the benefit of the heirs,
personal representatives and estate of Indemnitee.

     11. If any provision or provisions of this Agreement shall be held to be
invalid, illegal or unenforceable for any reason whatsoever (i) the validity,
legality and enforceability of the remaining provisions of this Agreement
(including, without limitation, all portions of any paragraphs of this Agreement
containing any such provision held to be invalid, illegal or unenforceable, that
are not by themselves invalid, illegal or unenforceable) shall not in any way be
affected or impaired thereby, and (ii) to the fullest extent possible, the
provisions of this Agreement (including, without limitation, all portions of any
paragraph of this Agreement containing any such provision held to be invalid,
illegal or unenforceable, that are not by themselves invalid, illegal or
unenforceable) shall be construed so as to give effect to the intent of the
parties that the Corporation provide protection to Indemnitee to the fullest
enforceable extent.

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.

ATTEST:                                OSTEOTECH, INC.

by:                                     by:
   ----------------------------             ----------------------------

Name:                                   Name:   Michael J. Jeffries
                                        Title:     Executive Vice President

                                        INDEMNITEE

                                            ----------------------------
                                        Name:
                                        Title:

                                        Address:

                                       4

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