ATS Liquidating Trust Announces Initial Cash Distribution

San Diego, Calif., May 30, 2003 -- The ATS Liquidating Trust (“Trust”) today announced an initial distribution of 6.5 cents per share to Trust beneficiaries that held ATS stock as of the Effective Date of ATS' Liquidating Chapter 11 Plan of Reorganization. The distribution will be made today, May 30, 2003.

The Trust will wire money today to its transfer agent, Mellon Investor Services, LLC, for distribution. It will then take Mellon several business days to print checks and prepare for their distribution by U.S. mail. Mellon will then forward the distribution to Trust beneficiaries who were Advanced Tissue Sciences, Inc. stockholders of record as of the close of business on March 31, 2003. Those former stockholders should not expect to receive their distribution for at least five to ten business days.

As a result of the Reorganizing Plan of Liquidation as approved by the Court, on the Effective Date the stock of the Company was cancelled and its former stockholders now hold non-trading beneficial interests in the ATS Liquidating Trust on a pro rata basis equal to their former shareholdings in the Company. According to the terms of the Plan, the interests in the ATS Liquidating Trust cannot be transferred, except by operation of law, and the Liquidating Trustee will only recognize as beneficiaries of the Trust those stockholders of record as of March 31, 2003, the Effective Date of the Plan.

Former stockholders whose shares were held in a brokerage account will receive any distribution from their broker and they should contact their broker to be sure any distributions are forwarded to them. Brokerage firms will receive lump sum checks covering all the former shares held by their clients.

The initial distribution was originally projected at 10 cents per share, based on assumptions as detailed in the Disclosure Statement. However, that amount was merely a projection based upon a series of assumptions. The Disclosure Statement specifically indicated that the actual numbers would likely differ from these projections. A number of factors have and will continue to influence those assumptions and projections and the actual amount and time of any distributions.

For example, the projection in the Disclosure Schedule assumed that all the assets would be sold by the initial distribution. That has not occurred as projected. The Cardiovascular and Segenix assets have not sold to date and the second sale to Smith & Nephew, which was approved by the Court on May 28, 2003, will not close in time for those proceeds to be included in the initial distribution.

In addition to the Cardiovascular and Segenix assets, other assets remaining in the Liquidating Trust include a $2 million note from SkinMedica which matures in 2005, royalty rights to potential future royalty payments from Inamed on Inamed’s sales of human collagen, a $1 million reserve associated with the sale of assets to Smith & Nephew that is required to be maintained until November 2003, and cash reserves for outstanding claims and Trust expenses.

The amount of royalties to be received from Inamed is not yet known and cannot be accurately estimated. The Disclosure Schedule contained a projection of potential royalty payments, and nothing has subsequently changed that would cause the Trustee to alter such a projection. However such amounts are a projection only and royalties actually received may be significantly different.

Subsequent distributions depend on the timing of asset sales, the proceeds of any such asset sales, the amount and timing of the receipt of royalties, milestone payments and any other cash that becomes available to the Trust. The Trustee cannot predict when a second distribution will occur. However, subsequent distributions are expected to be made at least annually until there is a final liquidating distribution.

The Trustee will from time to time provide updates on events on this site that may have a material impact on future distributions. These events may include the settlement of claims, receipt of royalty payments, or asset sales.

The next date on which the ATS Liquidating Trust will provide a detailed quarterly financial report to the U. S. Trustee is July 18, 2003.