Common use of EBITDA Ratio Clause in Contracts

EBITDA Ratio. Osteotech, Inc. is not to cause or permit any of the following: (a) For the first quarter of 2002, the earnings before interest, taxes, depreciation and amortization of Osteotech, Inc. and its Subsidiaries ("EBITDA") to be less than $1,100,000.00 (the fee payable pursuant to Section 6.15(b), attorneys' fees payable by the Borrower hereunder, appraisal fees, collateral review exam fees, counsel fees payable by the Borrower to implement the pledge of stock set forth in Article 4(c) and related expenses ("Excluded Expenses")) are not to be included in this determination); (b) For the second quarter of 2002, EBITDA to be less than $1,920,000.00 (Excluded Expenses are not to be included in this determination); (c) For the third quarter of 2002, the ratio of EBITDA less capital expenditures, less cash taxes (multiplied by 4) to the current maturities of long term debt plus interest expense, to be less than 1:1 (Excluded Expenses are not to be included in this determination); (d) For the fourth quarter of 2002, a minimum EBITDA of $1,570,000.00 (Excluded Expenses are not to be included in this determination); (e) For the first quarter of 2003, the ratio of EBITDA for such quarter less capital expenditures, less cash taxes (all multiplied by 4) to the current maturities of long term debt plus (first quarter interest expense multiplied by 4), to be less than 1:1 (Excluded Expenses are not to be included in this determination); (f) For the second quarter of 2003, the ratio of EBITDA for the first and second quarters of 2003 less capital expenditures, less cash taxes (all divided by 2 and then multiplied by 4) to the current maturities of long term debt plus (interest expense -7- for the first and second quarters divided by 2 and then multiplied by 4), to be less than 1:1 (Excluded Expenses are not to be included in this determination); (g) For the third quarter of 2003, the ratio of EBITDA for the first, second and third quarters of 2003 less capital expenditures, less cash taxes (all divided by 3 and then multiplied by 4) to the current maturities of long term debt plus (interest expense for the first, second and third quarters divided by 3 and then multiplied by 4), to be less than 1.25:1 (Excluded Expenses are not to be included in this determination); (h) For the fourth quarter of 2003, the ratio of EBITDA for the first, second, third and fourth quarters of 2003 less capital expenditures, less cash taxes to the current maturities of long term debt plus interest expense for the first, second, third and fourth quarters, determined on a rolling four quarter basis, to be less than 1.25:1 (Excluded Expenses are not to be included in this determination); or (i) Thereafter, the ratio of EBITDA less capital expenditures less cash taxes to the current maturities of long term debt plus interest expense, determined on a rolling four quarter basis, to be less than 1.25:1 (Excluded Expenses are not to be included in this determination). Non-compliance by the Borrower with its prior covenant that its ratio of EBITDA less capital expenditures, less cash taxes (multiplied by 4) to the current maturities of long term debt plus interest expense be not less than 1:1 for the third quarter of 2002 is hereby waived by Lender. Such waiver shall be without prejudice in the event of any other Default hereunder. Such waiver is also not to be deemed a waiver of any further or other non-compliance or Default. Non-compliance by the Borrower with its prior covenant of a minimum EBITDA of $1,570,000 for the fourth quarter of 2002 is hereby waived by Lender. Such waiver shall be without prejudice in the event of any other Default hereunder. Such waiver is also not to be deemed a waiver of any further or other non-compliance or Default. All of the foregoing is to be determined in accordance with generally accepted accounting principles consistently applied. 7. Paragraph 3D(35) (relating to Section 11.4 of the Loan Agreement) is hereby amended to read as follows:

EBITDA Ratio. Osteotech, Inc. is not to cause or permit any of the following: (a) For the first quarter of 2002, the earnings before interest, taxes, depreciation and amortization of Osteotech, Inc. and its Subsidiaries ("EBITDA") to be less than $1,100,000.00 (the fee payable pursuant to Section 6.15(b), attorneys' fees payable by the Borrower hereunder, appraisal fees, collateral review exam fees, counsel fees payable by the Borrower to implement the pledge of stock set forth in Article 4(c) and related expenses ("Excluded Expenses")) are not to be included in this determination); (b) For the second quarter of 2002, EBITDA to be less than $1,920,000.00 (Excluded Expenses are not to be included in this determination); (c) For the third quarter of 2002, the ratio of EBITDA less capital expenditures, less cash taxes (multiplied by 4) to the current maturities of long term debt plus interest expense, to be less than 1:1 (Excluded Expenses are not to be included in this determination); (d) For the fourth quarter of 2002, a minimum EBITDA of $1,570,000.00 (Excluded Expenses are not to be included in this determination); (e) For the first quarter of 2003, the ratio of EBITDA for such quarter less capital expenditures, less cash taxes (all multiplied by 4) to the current maturities of long term debt plus (first interest expense, determined on a rolling four quarter interest expense multiplied by 4)basis, to be less than 1:1 (Excluded Expenses are not to be included in this determination); (f) For the second quarter of 2003, the ratio of EBITDA for the first and second quarters of 2003 less capital expenditures, less cash taxes (all divided by 2 and then multiplied by 4) to the current maturities of long term debt plus (interest expense -7- for the first and second quarters divided by 2 and then multiplied by 4), to be less than 1:1 (Excluded Expenses are not to be included in this determination); (g) For the third quarter of 2003, the ratio of EBITDA for the first, second and third quarters of 2003 less capital expenditures, less cash taxes (all divided by 3 and then multiplied by 4) to the current maturities of long term debt plus (interest expense for the first, second and third quarters divided by 3 and then multiplied by 4), to be less than 1.25:1 (Excluded Expenses are not to be included in this determination); (h) For the fourth quarter of 2003, the ratio of EBITDA for the first, second, third and fourth quarters of 2003 less capital expenditures, less cash taxes to the current maturities of long term debt plus interest expense for the first, second, third and fourth quarters, determined on a rolling four quarter basis, to be less than 1.25:1 (Excluded Expenses are not to be included in this determination); or (ie) Thereafter, the ratio of EBITDA less capital expenditures less cash taxes to the current maturities of long term debt plus interest expensedebt, determined on a rolling four quarter basis, to be less than 1.25:1 (Excluded Expenses are not to be included in this determination). Non-compliance by the Borrower with its prior covenant that its ratio of EBITDA less capital expendituresto scheduled principal payments, less cash taxes (multiplied by 4) to the current maturities of long term debt plus actual interest expense and dividends be not less than 1:1 1.5:1 for the third quarter of 2002 period ending December 31, 2001 is hereby waived by Lender. Such waiver shall be without prejudice in the event of any other Default hereunder. Such waiver is also not to be deemed a waiver of any further or other non-compliance or Default. Non-compliance by the Borrower with its prior covenant of a minimum EBITDA of $1,570,000 for the fourth quarter of 2002 is hereby waived by Lender. Such waiver shall be without prejudice in the event of any other Default hereunder. Such waiver is also not to be deemed a waiver of any further or other non-compliance or Default. All of the foregoing is to be determined in accordance with generally accepted accounting principles consistently applied. 7. Paragraph 3D(35(23) (relating to The following is added as Section 11.4 of the Loan Agreement) is hereby amended to read as follows7.20:

EBITDA Ratio. Osteotech, Inc. is not to cause or permit any of the following: (a) For the first quarter of 2002, the earnings before interest, taxes, depreciation and amortization of Osteotech, Inc. and its Subsidiaries ("EBITDA") to be less than $1,100,000.00 (the fee payable pursuant to Section 6.15(b), attorneys' fees payable by the Borrower hereunder, appraisal fees, collateral review exam fees, counsel fees payable by the Borrower to implement the pledge of stock set forth in Article 4(c) and related expenses ("Excluded Expenses")) are not to be included in this determination); (b) For the second quarter of 2002, EBITDA to be less than $1,920,000.00 (Excluded Expenses are not to be included in this determination); (c) For the third quarter of 2002, the ratio of EBITDA less capital expenditures, less cash taxes (multiplied by 4) to the current maturities of long term debt plus interest expense, to be less than 1:1 (Excluded Expenses are not to be included in this determination); (d) For the fourth quarter of 2002, a minimum EBITDA of $1,570,000.00 (Excluded Expenses are not to be included in this determination); (e) For the first quarter of 2003, the ratio of EBITDA for such quarter less capital expenditures, less cash taxes (all multiplied by 4) to the current maturities of long term debt plus (first quarter interest expense multiplied by 4), to be less than 1:1 (Excluded Expenses are not to be included in this determination); (f) For the second quarter of 2003, the ratio of EBITDA for the first and second quarters of 2003 less capital expenditures, less cash taxes (all divided by 2 and then multiplied by 4) to the current maturities of long term debt plus (interest expense -7- for the first and second quarters divided by 2 and then multiplied by 4), to be less than 1:1 (Excluded Expenses are not to be included in this determination); (g) For the third quarter of 2003, the ratio of EBITDA for the first, second and third quarters of 2003 less capital expenditures, less cash taxes (all divided by 3 and then multiplied by 4) to the current maturities of long term debt plus (interest expense for the first, second and third quarters divided by 3 and then multiplied by 4), to be less than 1.25:1 (Excluded Expenses are not to be included in this determination); (h) For the fourth quarter of 2003, the ratio of EBITDA for the first, second, third and fourth quarters of 2003 less capital expenditures, less cash taxes to the current maturities of long term debt plus interest expense for the first, second, third and fourth quarters, determined on a rolling four quarter basis, to be less than 1.25:1 (Excluded Expenses are not to be included in this determination); or (i) Thereafter, the ratio of EBITDA less capital expenditures less cash taxes to the current maturities of long term debt plus interest expense, determined on a rolling four quarter basis, to be less than 1.25:1 (Excluded Expenses are not to be included in this determination). Non-compliance by the Borrower with its prior covenant that its ratio of EBITDA less capital expenditures, less cash taxes (multiplied by 4) to the current maturities of long term debt plus interest expense be not less than 1:1 for the third quarter of 2002 is hereby waived by Lender. Such waiver shall be without prejudice in the event of any other Default hereunder. Such waiver is also not to be deemed a waiver of any further or other non-compliance or Default. Non-compliance by the Borrower with its prior covenant of a minimum EBITDA of $1,570,000 for the fourth quarter of 2002 is hereby waived by Lender. Such waiver shall be without prejudice in the event of any other Default hereunder. Such waiver is also not to be deemed a waiver of any further or other non-compliance or Default. All of the foregoing is to be determined in accordance with generally accepted accounting principles consistently applied. 7. Paragraph 3D(35) (relating B. The following is added as Section 7.21 to Section 11.4 of the Loan Agreement) is hereby amended to read Agreement (as followsdefined in the Agreement of Amendment: