EXHIBIT 10.22(a)

CERTAIN CONFIDENTIAL PORTIONS OF THIS EXHIBIT WERE OMITTED BY MARKING SUCH
PORTIONS WITH ASTERISKS (THE "MARK").  tHIS EXHIBIT HAS BEEN FILED SEPARATELY
WITH THE SECRETARY OF THE COMMISSION WITHOUT THE MARK PURSUANT TO THE COMPANY'S
APPLICATION REQUESTING CONFIDENTIAL TREATMENT.


                                LICENSE AGREEMENT

                                     BETWEEN

                         ADVANCED TISSUE SCIENCES, INC.

                         A DELAWARE CORPORATION, AS ATS

                                       AND

                               INAMED CORPORATION,

                         A DELAWARE CORPORATION, AS IMDC


<PAGE>


                               TABLE OF CONTENTS

                                                                           Page
                                                                           ----

ARTICLE 1    LICENSE GRANT...................................................2
     1.1     License to Use ATS Intellectual Property Rights for
              First Phase Product Categories.................................2
     1.2     Option to Acquire License to Use ATS Intellectual
              Property Rights for Second Phase Product Categories............2
     1.3     Reservation of Rights...........................................2
     1.4     Disclosure of ATS Technology....................................2

ARTICLE 2    REMUNERATION....................................................2
     2.1     License Fees....................................................3
     2.2     Milestone Payments..............................................3
     2.3     Running Royalty.................................................3
     2.4     First Additional Royalty........................................3
     2.5     Second Additional Royalty.......................................3
     2.6     Minimum Royalty.................................................3
     2.7     Reports, Records and Royalty Payments...........................4
     2.8     Currency........................................................4
     2.9     Late Charges....................................................4
     2.10    Foreign Sales...................................................4
     2.11    Foreign Taxes...................................................5
     2.12    Product Prices..................................................5
     2.13    Sales to Affiliates.............................................5
     2.14    Books and Records...............................................5
     2.15    Audit Rights....................................................5

ARTICLE 3    RESEARCH & DEVELOPMENT; COMMERCIALIZATION EFFORTS...............5
     3.1     R&D Plan; Clinical and Regulatory Approval Plan.................5
     3.2     ATS Responsibilities............................................5
     3.3     IMDC Responsibilities...........................................6
     3.4     Ownership of Data and Regulatory Approvals......................6
     3.5     Diligence.......................................................6
     3.6     Research Committee..............................................6
     3.7     Disputes........................................................6
     3.8     Publications....................................................7

ARTICLE 4    MANUFACTURING; PURCHASE AND SALE OF PRODUCTS....................7
     4.1     ATS Right to Manufacture........................................7
     4.2     Third Party Manufacture.........................................7
     4.3     Price...........................................................7
     4.4     Forecasts.......................................................8
     4.5     Royalty [**   ].................................................8
     4.6     Secondary Manufacturing.........................................8
     4.7     Purchase Orders.................................................8


                                      -i-

<PAGE>


                              TABLE OF CONTENTS

                                                                           Page
                                                                           ----

     4.8     IMDC Audit Rights...............................................8

ARTICLE 5    INTELLECTUAL PROPERTY MATTERS...................................9
     5.1     Patent Prosecution and Maintenance..............................9
     5.2     Ownership of ATS Patents and ATS Know-How.......................9
     5.3     Ownership of Improvements.......................................9
     5.4     Third Party Infringement........................................9
     5.5     Third Party Infringement Claims................................10
     5.6     Marking........................................................10
     5.7     Trademarks.....................................................10

ARTICLE 6    INDEMNITY......................................................11
     6.1     IMDC Indemnity.................................................11
     6.2     ATS Indemnity..................................................11
     6.3     Insurance......................................................11
     6.4     Third Party Manufacture........................................11
     6.5     Cooperation....................................................11

ARTICLE 7    REPRESENTATIONS AND WARRANTIES; LIABILITY LIMITATION...........12
     7.1     Both Parties' Representations and Warranties...................12
     7.2     ATS' Representations and Warranties............................12
     7.3     No Additional Warranties.......................................12
     7.4     Limitation on Damages..........................................12

ARTICLE 8    COMPLIANCE WITH LAWS...........................................12
     8.1     General........................................................12
     8.2     Governmental Rights............................................13

ARTICLE 9    CONFIDENTIALITY................................................13
     9.1     Treatment of Confidential Information..........................13
     9.2     Publicity......................................................13

ARTICLE 10   TERM AND TERMINATION...........................................14
     10.1    Term...........................................................14
     10.2    Term Extension.................................................14
     10.3    Termination Upon Default.......................................14
     10.4    Rights Upon Termination........................................15
     10.5    Survivability..................................................16
     10.6    Work-in-Progress...............................................16
     10.7    Termination Not Exclusive Remedy...............................16
     10.8    Change of Control..............................................16

ARTICLE 11   ASSIGNMENT; SUCCESSORS.........................................16
     11.1    Assignment.....................................................16


                                      -ii-

<PAGE>


                              TABLE OF CONTENTS

                                                                           Page
                                                                           ----

     11.2    Binding Upon Successors and Assigns............................17

ARTICLE 12   GENERAL PROVISIONS.............................................17
     12.1    Waiver.........................................................17
     12.2    Arbitration....................................................17
     12.3    Notices........................................................17
     12.4    Governing Law..................................................18
     12.5    Entire Agreement...............................................18
     12.6    Amendments.....................................................18
     12.7    Force Majeure..................................................18
     12.8    Severability...................................................18
     12.9    Recording......................................................18
     12.10   Counterparts...................................................18

EXHIBIT A    DEFINITIONS.....................................................1

EXHIBIT B    INAMED RELATED PATENT RIGHTS (License Agreement)................1


                                     -iii-


<PAGE>


                                LICENSE AGREEMENT
                                -----------------

     THIS LICENSE AGREEMENT (the "License Agreement" or "Agreement") is made and
entered into as of May 10, 1999 (the "Effective Date"), by and between Advanced
Tissue Sciences, Inc., a Delaware corporation ("ATS"), and Inamed Corporation, a
Delaware corporation ("IMDC").

                                    RECITALS
                                    --------

     A. Certain capitalized terms used in this License Agreement are defined to
have the meaning as specified on Exhibit A attached hereto and made a part
                                 ---------
hereof.

     B. ATS owns certain ATS Intellectual Property Rights which can be applied
toward developing products in the Product Categories.

     C. IMDC desires (i) to collaborate with ATS in the research and development
which is necessary to develop and to identify and formalize the specifications
for the Subject Products, which comprise the Product Portfolio; (ii) to obtain
the appropriate FDA and other regulatory approvals which are necessary to bring
the Product Portfolio to commercial fruition; and (iii) to become [**         ]
worldwide licensee authorized to sell, market and distribute the Subject
Products.

     D. In order to accomplish the foregoing, ATS and IMDC will mutually agree
to an R&D Plan and a Clinical and Regulatory Approval Plan with respect to each
of the Subject Products.

     E. IMDC desires to expand its current business as the leading company in
plastic and reconstructive surgery, primarily breast implants, by acquiring and
developing a broad range of collagen-based products (whether bovine-based or
human-based, such as those included within the Product Portfolio). This License
Agreement initially covers only certain products ("First Phase Subject
Products") within the Product Portfolio; under certain circumstances, as
specified below, the license granted hereunder may be expanded to include
additional products ("Second Phase Subject Products") within the Product
Portfolio.

     F. As of May 10, 1999, ATS and IMDC entered into that certain Heads of
Agreement setting forth the general agreement of ATS and IMDC with respect to
the activities set forth in recitals C, D and E, above (the "Heads of
Agreement"). This License Agreement is the license agreement referenced in said
Heads of Agreement, and sets forth in more detail the rights and obligations of
the parties with respect to said activities as contemplated by the Heads of
Agreement.

         NOW, THEREFORE, the parties hereto hereby agree as follows:


<PAGE>



                                    ARTICLE 1
                                  LICENSE GRANT

          1.1 License to Use ATS Intellectual Property Rights for First Phase
              ---------------------------------------------------------------
Product Categories. ATS hereby grants to IMDC a non-transferable, [**      ],
------------------
worldwide license under the ATS Intellectual Property Rights to make, use, sell
and import the First Phase Subject Products, subject to the terms of this
License Agreement. IMDC's right to manufacture First Phase Subject Products is
expressly subject to ATS' (or ATS' Affiliates') first right to manufacture the
First Phase Subject Products as set forth in Section 4.2 ("ATS Rights to
Manufacture"). The license set forth in this Section 1.1 does not include any
sublicense rights.

          1.2 Option to Acquire License for Second Phase Product Categories. If
              -------------------------------------------------------------
IMDC acquires at least [**] of Collagen Aesthetics, Inc. ("CGEN") by September
30, 1999, IMDC will acquire from ATS a non-transferable, [**     ], worldwide
license under the ATS Intellectual Property Rights necessary to make, use, sell
and import Second Phase Subject Products, subject to the terms of this License
Agreement. The license referred to in this Section 1.2 does not include any
right to sublicense except rights relating to the Urinary Incontinence Products.
Until the earlier of such time as IMDC acquires [**] of CGEN or September 30,
1999, with respect to every aspect of the Second Phase Product Categories, (i)
IMDC shall also have the option acquire such license at its election by written
notice to ATS; and (ii) ATS and IMDC will deal [**            ] with each other;
provided, however, that in the event CGEN is acquired by a third party prior to
September 30, 1999, ATS may give a written notice to IMDC that ATS no longer
wishes to be bound by this Section 1.2; and in the event ATS does give said
written notice, then IMDC shall still be entitled to acquire the license for the
Second Phase Product Categories if IMDC makes payment to ATS within 30 days
after IMDC's receipt of said written notice in the amounts as specified in
Section 2.1(d) below. Upon IMDC so paying for this additional license right, the
parties shall enter into an addendum to this License Agreement adding the Second
Phase Product Categories to this License Agreement, which addendum shall contain
any necessary additional terms incident to adding the Second Phase Product
Categories, including, but not limited to, the conditions under which IMDC may
grant sublicenses to the Urinary Incontinence Products.

          1.3 Reservation of Rights. ATS retains and reserves the right to use
              ---------------------
ATS Intellectual Property Rights for any and all uses not specifically licensed
to IMDC hereunder, including, without limitation, the right to license the ATS
Intellectual Property Rights to third parties for product categories other than
the First Phase Product Categories and the Second Phase Product Categories.

          1.4 Disclosure of ATS Technology. Promptly after the Effective Date,
              ----------------------------
to the extent it has not already done so, ATS will disclose to IMDC all existing
ATS Intellectual Property Rights useful or necessary for IMDC to reasonably
exploit the rights licensed hereunder. Further, ATS will provide reasonable
technical assistance to IMDC, to permit IMDC to reasonably utilize the licensed
ATS Intellectual Property Rights, for which IMDC will reimburse ATS' reasonable
and documented out-of-pocket costs (such as travel expenses), and IMDC will pay
for ATS' direct labor costs related thereto.


                                       2

<PAGE>


                                    ARTICLE 2
                                  REMUNERATION

          2.1 License Fees. IMDC will make payments to ATS as set forth in
              ------------
subsections (a) through (d) below.

              (a) $1 million cash license fee on or before May 20, 1999.

              (b) $1 million cash license fee on or before August 1, 1999.

              (c) $1 million cash license fee on or before November 1, 1999.

              (d) $2 million cash if IMDC exercises its option to acquire a
license to the Second Phase Product Categories set forth in Section 1.2 ("Option
to Acquire License to for Second Phase Subject Product Categories").

          2.2 Milestone Payments. IMDC will pay to ATS as milestone payments
              ------------------
(the "Milestone Payments") the sum of [**                            ], within
thirty (30) days after [**             ] for each Subject Product; provided,
however, that in no event will the Milestone Payments exceed an aggregate of
[**                             ] during the term of this Agreement.

          2.3 Running Royalty. IMDC will pay to ATS a running royalty ("Running
              ---------------
Royalty") of [**] of Net Sales of Subject Products.

          2.4 First Additional Royalty. For each calendar year, IMDC will pay to
              ------------------------
ATS an additional royalty payment ("First Additional Royalty") based on the
aggregate Net Sales of all Subject Products, as follows:

              (a) [**                       ]        [** ]

              (b) [**                       ]        [** ]

              (c) [**                        ]       [** ]

              (d) [**                        ]       [** ]

              (e) [**               ]                [** ]

          2.5 Second Additional Royalty. For each calendar year in which the
              -------------------------
aggregate Net Sales of all Subject Products manufactured by ATS (or an ATS
Affiliate) exceed [**       ], IMDC will pay to ATS an additional royalty
payment ("Second Additional Royalty") equal to [**] of the amount by which
IMDC's Gross Profit Margin on such Subject Products is more than [** ].

          2.6 Minimum Royalty. Commencing with the calendar year in which the
              ---------------
FDA approves the first PMA for the first Subject Product within a particular
Product Category, IMDC will pay to ATS a minimum basic royalty payment for that
particular Product Category


                                       3

<PAGE>


according to the following schedule, against which IMDC shall receive a credit
toward any amounts paid under Section 2.3 ("Running Royalty") for that
particular Product Category for such calendar year:

              (a) [**    ]                   [**         ]

              (b) [**     ]                  [**         ]

              (c) [**      ]                 [**         ]

              (d) [**     ]                  [**         ]

              (e) [**           ]            [**         ]

              2.6.1 If FDA approval of the first PMA in a Product Category
occurs prior to July 1, the Minimum Royalty payment due for that year shall be
[**        ].

              2.6.2 In the event IMDC makes any First Additional Royalty
payments or Second Additional Royalty payments in any given calendar year, then
the obligation to make Minimum Royalty payments under Section 2.6 will be
canceled for both that calendar year and the subsequent calendar year.

              2.6.3 The obligation to make Minimum Royalty payments applies to
each and every particular Product Category.

          2.7 Reports, Records and Royalty Payments. IMDC shall submit to ATS on
              -------------------------------------
a quarterly basis (commencing with the quarter in which the first sale of a
Subject Product occurs) a written report which specifies the Net Sales of
Subject Products for said quarter for Net Sales made by IMDC. Said report and
any related payments shall be submitted within 30 days following the end of each
calendar quarter.

          2.8 Currency. All payments referred to above shall be in United States
              --------
dollars.

          2.9 Late Charges. Any late payments under this Section 2 shall incur
              ------------
late charges at a rate equal to the Wall Street Journal Prime Rate, plus two
percent (2%).

          2.10 Foreign Sales. The remittance of royalties payable on sales
               -------------
outside the United States shall be payable to ATS in United States Dollar
equivalents at the official rate of exchange of the currency of the country from
which the royalties are payable, as quoted in the Wall Street Journal for the
last business day of the calendar quarter in which the royalties are payable. If
the transfer of or the conversion in the United States Dollar equivalents of any
such remittance in any such instance is not lawful or possible, the payment of
such part of the royalties as is necessary shall be made by the deposit thereof,
in the currency of the country where the sale was made on which the royalty was
based, to the credit and account of ATS or its nominee in any commercial bank or
trust company of ATS' choice located in that country, and prompt written notice
of which shall be given by IMDC to ATS.


                                       4

<PAGE>


          2.11 Foreign Taxes. Any tax required to be withheld by IMDC under the
               -------------
laws of any foreign country for the account of ATS shall be promptly paid by
IMDC for and on behalf of ATS to the appropriate governmental authority, and
IMDC shall furnish ATS with proof of payment of such tax together with official
or other appropriate evidence issued by the applicable governmental authority.
Any such required tax actually paid on ATS' behalf shall be deducted from the
royalty payment due ATS.

          2.12 Product Prices. IMDC shall sell all Subject Products at a
               --------------
commercially reasonable sales price, and if IMDC elects to sell any of the
Subject Products at less than a commercially reasonable sales price (e.g., as a
"loss leader"), then the royalties shall be paid on the commercially reasonable
sales price, rather than on the lower actual reduced price.

          2.13 Sales to Affiliates. In order to assure ATS the full royalty
               -------------------
payments contemplated in this License Agreement, IMDC agrees that in the event
any Subject Product is sold for purposes of resale to an Affiliate of IMDC, then
the royalties to be paid in respect to such Subject Product will be computed on
the net selling price at which the purchaser for resale sells such Subject
Products rather than on the net selling price of IMDC.

          2.14 Books and Records. IMDC agrees to keep proper records and books
               -----------------
of account in accordance with good accounting practices, showing the sales upon
which the royalty payments of IMDC are based, and all other information
necessary for the accurate determination of payment to be made hereunder.

          2.15 Audit Rights. On reasonable written notice, ATS, at its own
               ------------
expense, shall have the right to have an independent certified public accountant
inspect and audit the books and records of IMDC during usual business hours for
the sole purpose of determining the correctness of payments due under this
Agreement. Such examination with respect to any fiscal year shall not take place
later than 3 years following the expiration of such period. The expense of any
such audit shall be borne by ATS; provided, however, that, if the audit
discloses an error in excess of [**] in favor of ATS, then IMDC shall pay the
cost to ATS of the audit.

                                    ARTICLE 3
                RESEARCH & DEVELOPMENT; COMMERCIALIZATION EFFORTS

          3.1 R&D Plan; Clinical and Regulatory Approval Plan. Within one
              -----------------------------------------------
hundred and twenty (120) days of execution of this Agreement, ATS and IMDC will
jointly develop for each Subject Product (i) a research and development plan
(the "R&D Plan"); and (ii) a clinical trial and regulatory plan (the "Clinical
and Regulatory Approval Plan"). It is anticipated that an R&D Plan and Clinical
and Regulatory Approval Plan for each Subject Product will be developed and
implemented concurrently.

          3.2 ATS Responsibilities. ATS will be responsible for conducting the
              --------------------
activities required for (i) the design of the Subject Products; and (ii) the
design of the manufacturing processes for the Subject Products in accordance
with the applicable R&D Plan. A reasonable limit on ATS's expenditures per year
for ATS's work under each R&D Plan (including work done internally and work
contracted out) shall be determined by the parties hereto, on a product by
product basis, which limit, during the first [**     ] of the R&D Plan,


                                       5

<PAGE>


shall not exceed [**] of the amount of payments made by IMDC to ATS described in
Section 2.1 ("License Fees") during such [**    ] period. Thereafter, the
parties will in good faith negotiate the future allocation of expenses and
limitations on ATS expenditures, if any, under the R&D Plan. ATS shall design
the Subject Products (including, without limitation, the package size for the
Subject Products, the projected shelf life of the Subject Products, and methods
for use of the Subject Products) based on specifications that reflect the needs
of the marketplace and reflect the collaborative spirit between IMDC and ATS.

          3.3 IMDC Responsibilities. IMDC will be responsible for planning,
              ---------------------
conducting and funding all of the clinical trials and regulatory submissions
necessary to obtain commercial clearance to sell the Subject Products in
accordance with the applicable Clinical and Regulatory Approval Plan.

          3.4 Ownership of Data and Regulatory Approvals. ATS and IMDC will
              ------------------------------------------
fully cooperate in the activities referenced in Section 3.2 ("ATS
Responsibilities") and Section 3.3 ("IMDC Responsibilities"), including sharing
all data obtained in connection with such activities. [**] will own the clinical
study data and regulatory approvals; provided, however, that [**] shall have
access to such information for (i) purposes of [**

                                                ]. In the event of any early
termination of this Agreement for reasons other than a breach [**  ], rights to
regulatory filings, data and approvals for the Product Portfolio will
automatically be granted to and vested in [**], and [**] shall execute and
deliver any and all appropriate documents to evidence and implement such rights.

          3.5 Diligence. ATS and IMDC shall each use commercially reasonable and
              ---------
diligent efforts to perform its respective activities and responsibilities under
the R&D Plans and Clinical and Regulatory Approval Plans and otherwise in order
to fulfill its responsibilities under Section 3.2 ("ATS Responsibilities") and
Section 3.3 ("IMDC Responsibilities").

          3.6 Research Committee. ATS and IMDC shall establish a Research
              ------------------
Committee (the "Research Committee"), comprised of an equal number of members
from ATS and IMDC:

              (a) to prepare the R&D Plans and Clinical and Regulatory Approval
                  Plans, and any amendments; and

              (b) to review and evaluate progress under the R&D Plans and
                  Clinical and Regulatory Approval Plans;

              (c) to coordinate and monitor publication of research results
                  obtained from the R&D Plans and Clinical and Regulatory
                  Approval Plans and to coordinate and monitor the exchange of
                  information and materials that relate to the R&D Plans and
                  Clinical and Regulatory Approval Plans.

          3.7 Disputes. If the parties are not able to promptly reach mutual
              --------
agreement for the R&D Plan or a Clinical and Regulatory Approval Plan for a
particular Subject Product, then either (i) the unresolved aspects for said R&D
Plan or Clinical and Regulatory Approval


                                       6

<PAGE>


Plan shall be resolved by a decision made jointly by the Research Committee;
(ii) if a joint decision cannot be reached pursuant to (i), IMDC may make the
decision as to the unresolved aspect for said R&D Plan or Clinical and
Regulatory Approval Plan so long as IMDC shall provide all of the funding for
implementing such unresolved aspect of the R&D Plan or Clinical and Regulatory
Approval Plan for the particular Subject Product; or (iii) the particular
Subject Product shall be removed from the license granted to IMDC, and
thereafter ATS shall have the sole right to pursue research and development and
commercialization efforts to said Subject Product.

          3.8 Publications. Results obtained in the course of the R&D Plan or
              ------------
Clinical and Regulatory Approval Plan may be submitted for publication following
scientific review by the Research Committee and subsequent written approval by
ATS' and IMDC's managements, which approval shall not be unreasonably withheld.
After receipt of the proposed publication by both parties' managements, written
approval or disapproval shall be provided within 30 days for a manuscript, and
within 14 days for an abstract for presentation at, or inclusion in the
proceedings of a scientific meeting, and within 14 days for presentation
materials to be used at a scientific meeting.

                                    ARTICLE 4
                  MANUFACTURING; PURCHASE AND SALE OF PRODUCTS

          4.1 ATS Right to Manufacture. ATS, or an Affiliate of ATS, shall have
the first right to manufacture each and every one of the Subject Products
comprising the Product Portfolio; and ATS shall sell those Subject Products
(for which IMDC has obtained and maintained [**     ] license rights pursuant to
this License Agreement) [**       ] to IMDC (as to the Product Categories
included within this Agreement) during the term of this Agreement, based on
forecasts and purchase orders submitted by IMDC. ATS shall elect whether to so
manufacture a Subject Product by delivering written notice of election to IMDC
at least six (6) months prior to IMDC receiving PMA approval from the FDA for
the particular Subject Product; provided, however, that IMDC shall keep ATS
reasonably informed as to the status of the PMA applications for each Subject
Product. Upon such election to manufacture, the parties shall agree upon the
price for the Subject Product as set forth in Section 4.4 ("Price"), as well as
all other necessary terms for purchase and sale such as acceptance of product,
delivery terms, payment terms, etc.

          4.2 Third Party Manufacture. If ATS, or an Affiliate of ATS, does not
              -----------------------
elect to manufacture a given Subject Product as set forth in Section 4.1 ("ATS
Right to Manufacture"), then either (i) IMDC may elect to manufacture said
Subject Product; or (ii) ATS and IMDC shall mutually agree as to a third party
manufacturer for said Subject Product.

          4.3 Price. If ATS (or an Affiliate of ATS) elects to manufacture a
              -----
given Subject Product, ATS (or an Affiliate of ATS) shall charge IMDC a
"transfer price" which reflects [**                         ]. IMDC shall have
the right to audit the costs for ATS (or ATS' Affiliate) to manufacture the
Subject Product as set forth in Section 4.8 ("IMDC Audit Rights"). Recognizing
that until ATS (or ATS'Affiliate) achieves a higher utilization rate of its
manufacturing facilities the transfer price may not reflect a [**            ]
at which IMDC can [**                 ], the transfer price plus royalties
payable under Section 3.2 ("Running


                                       7


<PAGE>


Royalty") shall not [**
         ] charges its customers, except as otherwise noted below. If said [**
    ] would result in a transfer price which is less than [**] times the [**
   ] for ATS (or ATS' Affiliate ) to manufacture the Subject Product, then the
parties shall pursue good faith negotiations for a mutually agreeable transfer
price. If no such agreement is reached, then ATS (or ATS' Affiliate) shall not
be obligated to manufacture and sell such Subject Product at a transfer price
less than [**] times the [**                      ]; and any such refusal of ATS
(or ATS' Affiliate) to manufacture and sell at a lower price shall not activate
the "royalty [**    ]" referenced in Section 4.5 (Royalty [**      ]) below. Any
inability of IMDC to obtain the Subject Product from ATS (or ATS' Affiliate)
because of the foregoing disagreement regarding pricing shall [**

                                                  ].

              4.3.1 In the situation where ATS is supplying a component which is
incorporated in a product finished by IMDC which would be considered a Subject
Product, the "transfer price" plus royalties payable under Section 3.2 shall not
[**                      ] of IMDC's total [**         ] (according to GAAP) for
such finished product. If said [**      ] would result in a transfer price which
is less than [**] times the [**       ] for ATS (or ATS's Affiliate) to
manufacture the component, then the parties shall pursue good faith negotiations
for a mutually agreeable transfer price; and if no such agreement is reached,
then the provisions set forth in the last two sentences of Section 4.3 shall
apply.

              4.3.2 Pricing formulas and mechanisms for Subject Products shall
be agreed to by the parties and attached hereto as Exhibit C.

          4.4 Forecasts. If ATS (or an Affiliate of ATS) exercises its right to
              ---------
manufacture, then within 30 days after regulatory approval for the Subject
Product in the first market, IMDC will provide a 12-month forecast with
estimated monthly purchase quantities. IMDC will provide an updated forecast
monthly on a rolling basis. The first five (5) months of each forecast will be
binding on IMDC and will be treated as a legally binding and firm purchase
order. ATS (or ATS' Affiliate) agrees to use commercially reasonable and
diligent efforts to support any demand that is higher than the forecast.

          4.5 Royalty [**   ]. In the event in any calendar month ATS (or ATS'
              ---------------
Affiliate) is out of stock with respect to more than [**] of IMDC's forecasts
for a particular Subject Product, and as a consequence ATS (or ATS' Affiliate)
is unable to ship to IMDC [**] or more of the forecasted amount, [**
        ] "royalty [**    ]", in which case all [**




                          ].

          4.6 Secondary Manufacturing. The parties will work together from time
              -----------------------
to time to develop comprehensive plans for secondary manufacturing sources,
and/or inventory stockpiles, to ensure an adequate level of supply of the
commercialized products to suit IMDC's anticipated needs.


                                       8


<PAGE>


          4.7 Purchase Orders. The terms of any purchase orders submitted by
              ---------------
IMDC shall not be binding upon ATS unless ATS specifically consents to such
terms in writing, to the extent such terms are inconsistent with or in addition
to the terms of this License Agreement.

          4.8 IMDC Audit Rights. On reasonable written notice, IMDC, at its own
              -----------------
expense, shall have the right to have an independent certified public accountant
inspect and audit the books and records of ATS (or ATS' Affiliate) during usual
business hours for the sole purpose of determining the cost of ATS (or ATS'
Affiliate) to manufacture a given Subject Product. Such examination with respect
to any Subject Product shall not take place later than 12 months following
calendar year in which IMDC purchased the Subject Product in question. The
expense of any such audit shall be borne by IMDC; provided, however, that, if
the audit discloses an error in excess of [**] in favor of IMDC, then ATS (or
ATS' Affiliate) shall pay the cost to IMDC of the audit.

                                    ARTICLE 5
                          INTELLECTUAL PROPERTY MATTERS

          5.1 Patent Prosecution and Maintenance. ATS shall have full control
              ----------------------------------
over prosecution and maintenance of the patent applications and patents
contained in the ATS Patents and Improvements. IMDC shall be responsible for the
costs of such prosecution and maintenance and shall reimburse ATS for such costs
upon a quarterly basis within thirty (30) days after receipt of ATS' invoice;
provided, however, that in the event any of such costs are incurred with respect
to a patent or patent application which has been licensed to third parties or
used commercially by ATS for other than the Product Categories licensed to IMDC
under this Agreement, then IMDC shall be responsible for only an equitable
allocation of such costs which allocation shall not exceed [**
                         ]. ATS shall deliver to IMDC copies of all patent
applications, amendments, material related correspondence, and other material
related matters for all ATS Patents within a reasonable period of time after
such items are received by or reported to ATS. ATS shall take into consideration
any comments or suggestions made by IMDC with respect to such prosecution and
maintenance, but final decisions shall reside with ATS. ATS shall file foreign
patent applications in those countries reasonably requested by IMDC or such
other countries as ATS may deem necessary and desirable. If ATS elects not to
file a patent application in a country in which IMDC has requested ATS to file
an application, or if ATS decides not to continue the prosecution of any patent
application or patent, domestic or foreign, contained in the ATS Patents or
Improvements, IMDC shall be free to do so at its expense; provided, however,
that (i) [**                                 ] any such patent applications or
patents filed or prosecuted by IMDC, such patent applications and patents shall
be included within the [**                                      ] hereunder, and
any Subject Products sold in such countries shall be subject to the royalty
obligations of this License Agreement and (ii) IMDC will keep ATS advised of the
status of such prosecution and maintenance by providing ATS with copies of all
official communications with respect to such patent applications and patents,
and IMDC shall take into consideration any comments or suggestions made by ATS
with respect to such prosecution and maintenance.

          5.2 Ownership of ATS Patents and ATS Know-How. All ATS Patents and ATS
              -----------------------------------------
Know-How shall be solely owned by ATS, and IMDC shall execute, or cause its
employees to execute, any documents necessary to perfect ATS' ownership rights
therein.


                                       9


<PAGE>


          5.3 Ownership of Improvements. ATS shall solely own all Improvements
              -------------------------
(including any patents or patent applications disclosing and claiming such
Improvements) made by its employees as a result of the activities contemplated
by the R&D Plans or Clinical and Regulatory Plans. Where ATS and IMDC employees
are co-inventors of (in the case of patents) or make an essential contribution
to (in the case of know-how) any Improvement, ATS shall solely own such
Improvement, and IMDC shall execute, or cause its employees to execute, any
documents necessary to perfect ATS' ownership rights therein. Upon termination
of this Agreement, IMDC shall have rights in such Improvements as specified in
Section 10.9 hereof. Where all inventors are employed by IMDC, IMDC shall be the
sole owner of the Improvement.

          5.4 Third Party Infringement. In the event IMDC or ATS becomes aware
              ------------------------
of any actual or threatened infringement of the Intellectual Property Rights
with respect to the Product Categories, that party shall promptly notify the
other and the parties shall discuss the most appropriate action to take. Both
parties shall use their reasonable efforts in cooperating with each other to
terminate such infringement without litigation. Within one hundred twenty (120)
days after the date of notification of infringement, if attempts to abate such
infringement are unsuccessful, then IMDC may (but is not obligated to) bring
such action at its own expense, in which event ATS shall cooperate with IMDC as
reasonably requested, at IMDC's expense. ATS may (but is not obligated to), on
its own initiative, join in such suit. All recoveries, damages and awards in
such suit, after reimbursement of all litigation expenses not previously
reimbursed by the defendant or insurance, shall be allocated [**] to IMDC and
[**] to ATS. In the event that IMDC elects not to institute or prosecute any
suit to enjoin or recover damages from any infringer, then ATS alone may (but is
not obligated to), in its sole discretion and at its expense, initiate and
conduct an infringement action and keep any settlement or award which may be
obtained. IMDC and ATS agree that neither will settle any action commenced by it
in a manner that is prejudicial to any ATS Intellectual Property Rights without
the other party's prior written approval. The parties recognize that ATS may
also license some of the ATS Patents to third parties for other than those
Product Categories licensed to IMDC under this Agreement; and if that does occur
and there are infringement actions which affect both IMDC and said third party,
then the parties agree that there will be cooperation between ATS, IMDC and said
third party(ies) regarding the handling of the infringement claim and an
equitable allocation of any settlement or award based upon the relative rights
and contributions of ATS, IMDC and the third party(ies).

          5.5 Third Party Infringement Claims. In the event any Subject Product
              -------------------------------
becomes the subject of a claim for patent or other proprietary right
infringement anywhere in the world, the parties shall promptly give notice to
the other and meet to consider the claim and the appropriate course of action.
IMDC shall have the right (but is not obligated to) to conduct the defense of
any such suit brought against IMDC and/or ATS, and shall have the sole right and
authority to settle any such suit; provided that ATS shall cooperate with IMDC,
as reasonably requested by IMDC, in connection with the defense of such claim,
at IMDC's expense. Notwithstanding the foregoing, however, if any such claim is
directed at the validity or scope of an ATS Patent, Improvement or ATS Know-How,
then, with respect to such claim, ATS shall have the right (but not the
obligation) to conduct the defense of any such suit, and shall have the sole
right and authority to settle any such suit; provided that IMDC shall cooperate
with ATS, as reasonably requested by ATS, in connection with the defense of such
claim, at ATS' expense.


                                       10


<PAGE>


          5.6 Marking. IMDC agrees to mark and to cause any sublicensee to mark
              -------
any Subject Products (or their containers or labels) made, sold, or otherwise
disposed of by it or them with any notice of patent rights necessary or
desirable under applicable law to enable the ATS Patents or Improvements to be
enforced to their full extent in any country where Subject Products are made,
used or sold.

          5.7 Trademarks. IMDC shall be responsible for the selection of the
              ----------
trademarks it uses in connection with the Subject Products; provided, however,
that the use of such trademarks will be subject to the prior approval of ATS,
which approval will not be unreasonably withheld. IMDC agrees not to select any
trademarks which may cause confusion with any ATS trademarks or trademarks of
any ATS Affiliate. IMDC shall [**           ] the trademarks it selects for the
Subject Products. IMDC shall be responsible for registration and maintenance of
all such trademarks at IMDC's cost.

                                    ARTICLE 6
                                    INDEMNITY

          6.1 IMDC Indemnity. IMDC hereby agrees to indemnify, defend and hold
              --------------
harmless ATS and its Affiliates and their respective directors, officers,
employees and agents from and against any liability or expense arising from the
promotion of the Product Portfolio, including without limitation (i) any product
liability or similar claim asserted by any party as to any Subject Products;
(ii) any claims arising from the use of any ATS Intellectual Property Rights
pursuant to this License Agreement which use infringes the issued valid patents
of a third party; (iii) any claims for death, personal injury or related
property damage arising from the manufacture, sale, marketing, distribution or
use of any Subject Products; and (iv) the material breach by IMDC of its
representations, warranties or obligations hereunder; provided, however, that
such indemnification shall not include any liability or expense directly and
solely attributable to design or development characteristics solely under the
control of ATS which were designed or developed solely by ATS or defects related
to ATS' (or ATS' Affiliate's) manufacturing of Subject Products which ATS (or
ATS' Affiliates) elects to manufacture. Without limiting the generality of the
foregoing, such indemnity and defense obligation shall apply to any product
liability or other claims, including without limitation, personal injury, death
or property damage, made by employees, subcontractors, or agents of IMDC, as
well as by any customer, patient, hospital, doctor, or member of the general
public who buys or uses the Subject Products. IMDC shall monitor customer
complaints and will be responsible for corrections, withdrawal or alert notices.

          6.2 ATS Indemnity. ATS hereby agrees to indemnify, defend and hold
              -------------
harmless IMDC and its Affiliates and their respective directors, officers,
employees and agents from and against any claims, actions, costs, damage,
liability or expense directly and solely attributable to design or development
characteristics solely under the control of ATS which were designed or developed
solely by ATS and any defects related to ATS' (or ATS' Affiliate's)
manufacturing of Subject Products which ATS (or ATS' Affiliate) agrees to
manufacture in accordance with IMDC's product specifications;.

          6.3 Insurance. Each party shall purchase and maintain customary
              ---------
products liability insurance, at reasonable levels to be agreed upon from time
to time, such that each party


                                       11


<PAGE>


bears responsibility for its own defects and negligence. Each party shall have
the other named as an additional insured party on any such product liability
insurance policies.

          6.4 Third Party Manufacture. In the event that ATS elects not to
              -----------------------
manufacture one or more Subject Product, then ATS and IMDC will jointly ensure
that the party who conducts the manufacturing process for such Subject
Products(s) accepts responsibility for its own defects and negligence.

          6.5 Cooperation. In the event that either party seeks indemnification
              -----------
under Section 6.1 ("IMDC Indemnity") or Section 6.2 ("ATS Indemnity"), it (i)
shall inform the other party of a claim as soon as reasonably practical after it
receives notice of the claim; (ii) shall permit the other party to assume
direction and control of the defense of the claim (including the right to settle
the claim); and (iii) shall cooperate as requested in the defense of the claim,
subject to being reimbursed for its reasonable expenses incurred in connection
therewith.

                                    ARTICLE 7
              REPRESENTATIONS AND WARRANTIES; LIABILITY LIMITATION

          7.1 Both Parties' Representations and Warranties. ATS and IMDC each
              --------------------------------------------
represents and warrants to the other that (i) it has the authority to enter into
and perform this License Agreement; and (ii) its execution, delivery and
performance of this License Agreement will not conflict with the terms of any
other agreement to which it is a party. ATS and IMDC each covenant not to enter
into any agreement which will conflict with the terms of this License Agreement.

          7.2 ATS' Representations and Warranties. ATS represents, warrants and
              -----------------------------------
covenants to IMDC that: (i) as of the Effective Date, ATS owns or has sufficient
rights in the ATS Patents and ATS Know-How, free and clear of any liens or
encumbrances, to grant the rights to IMDC as contained in this License
Agreement; (ii) during the term of this License Agreement, ATS will use
reasonable best efforts not to encumber or diminish the rights granted to IMDC
hereunder; (iii) ATS is not aware of any existing or threatened infringement
action or claim of invalidity or adverse ownership with respect to the subject
matter of the ATS Patents and ATS Know-How for use in conjunction with the
Subject Products or of any facts which indicate that any such action or claim is
likely to be instituted or asserted. IMDC understands, however, that the ATS
Intellectual Property Rights involve technologies which have not been approved
by any regulatory agency, and that ATS cannot guarantee the safety or usefulness
of any Subject Products.

          7.3 No Additional Warranties. ATS MAKES NO WARRANTIES OTHER THAN AS
              ------------------------
SET FORTH IN SECTION 7.2 ("ATS' Representations and Warranties") CONCERNING ATS
INTELLECTUAL PROPERTY COVERED BY THIS LICENSE AGREEMENT, INCLUDING WITHOUT
LIMITATION, ATS MAKES NO EXPRESS OR IMPLIED WARRANTY OF MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE.  EXCEPT AS SET FORTH IN SECTION 7.2 ("ATS'
Representations and Warranties"), ATS MAKES NO WARRANTY OR REPRESENTATION AS TO
THE VALIDITY OR SCOPE OF THE ATS INTELLECTUAL PROPERTY RIGHTS, OR THAT


                                       12


<PAGE>


ANY OF THE SUBJECT PRODUCTS WILL BE FREE FROM AN INFRINGEMENT ON PATENTS OF
THIRD PARTIES, OR THAT NO THIRD PARTIES ARE IN ANY WAY INFRINGING ATS
INTELLECTUAL PROPERTY RIGHTS.

          7.4 Limitation on Damages. IN NO EVENT WILL EITHER PARTY BE LIABLE FOR
              ---------------------
ANY INCIDENTAL, SPECIAL OR CONSEQUENTIAL DAMAGES ARISING FROM THIS AGREEMENT.

                                    ARTICLE 8
                              COMPLIANCE WITH LAWS

          8.1 General. Each party shall, at its expense, comply with all laws,
              -------
rules and regulations applicable to the performance by them of their respective
obligations under this License Agreement. IMDC shall register this License
Agreement with any governmental agency which requires such registration, and
IMDC shall pay all costs and legal fees in connection therewith.

          8.2 Governmental Rights. Certain of the research underlying the ATS
              -------------------
Intellectual Property Rights has been funded in part by the National Institutes
of Health of the United States of America, and as a result of such governmental
funding, the United States Government has certain rights in the inventions made
from said funding. The license rights granted by ATS to IMDC under this License
Agreement are subject to said governmental rights, and IMDC agrees to comply
with said governmental rights, to the extent applicable. ATS shall furnish to
IMDC from time to time such material information and documents as may reasonably
be required to evaluate the rights of the United States Government.

                                    ARTICLE 9
                                 CONFIDENTIALITY

          9.1 Treatment of Confidential Information. During the term of this
License Agreement, and for a period of [**          ] after this License
Agreement expires or terminates, a party receiving Confidential Information of
the other party will (i) maintain in confidence such Confidential Information to
the same extent such party maintains its own proprietary information (but at a
minimum each party shall use reasonable efforts); (ii) not disclose such
Confidential Information to any third party without prior written consent of the
other party; and (iii) not use such Confidential Information for any purpose
except those permitted by this License Agreement. A party shall have no such
obligation with respect to any portion of such Confidential Information which:

              9.1.1 is publicly disclosed by the disclosing party, or is
otherwise publicly disclosed without the fault of the receiving party, either
before or after it becomes known to the receiving party; or

              9.1.2 was known to the receiving party prior to when it was
received from the disclosing party; or

              9.1.3 is subsequently disclosed to the receiving party in good
faith by a third party who has a right to make such a disclosure; or


                                       13


<PAGE>


              9.1.4 has been published by a third party as a matter of right; or

              9.1.5 has been independently developed by the receiving party
without the aid, application or use of Confidential Information from the
disclosing party; or

              9.1.6 is required by law to be disclosed, but then only to the
limited extent of such legally required disclosure.

          9.2 Publicity. Any publication, news release or other public
              ---------
announcement relating to this License Agreement, including the Exhibits and any
of its or their respective terms, or to the performance hereunder, shall first
be reviewed and approved by both parties, which approval shall not be
unreasonably withheld; provided, however, that any disclosure which is required
by law may be made without the prior consent of the other party, although the
other party shall be given prompt notice of any such legally required disclosure
and an opportunity to comment on the proposed disclosure reasonably in advance
to the extent feasible. Further, the disclosing party shall make diligent
efforts to limit the nature and scope of any disclosure to the extent reasonably
possible. Either party shall be entitled to disclose the substance of this
License Agreement to its shareholders (and to prospective shareholders to whom
its stock is offered for purchase) under the customary confidentiality agreement
and subject to the diligence requirements in the second sentence preceding this
sentence. Each party shall also be entitled to provide a copy of this License
Agreement to the Securities and Exchange Commission (if required).

                                   ARTICLE 10
                              TERM AND TERMINATION

          10.1 Term. Unless terminated sooner in accordance with the provisions
               ----
set forth herein, or extended in accordance with Section 10.2 ("Term
Extension"), this License Agreement, and the licenses granted hereunder, shall
commence on the Effective Date of this License Agreement and shall terminate at
the later of (i) 15 years; or (ii) such time as the last of the patents included
within the ATS Intellectual Property Rights expires.

          10.2 Term Extension. Subject to the terms of this Section 10.2, IMDC
               --------------
shall have the right to extend the term of this Agreement for successive annual
renewal terms on a Product Category - by - Product Category basis by giving to
ATS written notice of renewal at least one year in advance. In the event of such
an extension, the minimum annual royalty payment under Section 2.6 ("Minimum
Royalty") shall be re-set, on a Product Category-by-Product Category basis, at
[**] of the average royalty payment under Section 2.6 ("Minimum Royalty") for
the prior [**    ] for the particular Product Category. ATS shall have the right
to reject IMDC's notice of extension for the particular Product Category if the
actual Running Royalties paid by IMDC for the particular Product Category have
not exceeded the Minimum Royalty payment under Section 2.6 ("Minimum Royalty")
for [**          ] of the prior [**      ].

          10.3 Termination Upon Default.
               ------------------------

              10.3.1 ATS shall have the right to terminate IMDC's license rights
with respect to any particular Subject Product or Product Category if:


                                       14


<PAGE>


                     (a) IMDC fails to exceed the Minimum Royalty payments under
Section 2.6 ("Minimum Royalty") for that particular Product Category for any [**
    ], commencing after [**     ] as defined in that section; or

                     (b) Within the time periods agreed upon by the parties from
time to time in the R&D Plan or Clinical and Regulatory Approval Plan , IMDC
does not use commercially reasonable efforts to obtain PMA approval for (i) [**
          ] Product Categories if the option under Section 1.2 ("Option to
Acquire License for Second Phase Product Categories") is exercised; or (ii) [**
      ] of the First Phase Product Categories if the option is not exercised;
provided, however, that in the event ATS retakes the licensing rights to a
Product Category pursuant to Section 3.7 ("Disputes") or pursuant to this
Section 10.3, then the thresholds specified above shall be appropriately reduced
in a manner which does not increase the percentage of Product Categories for
which a PMA must be obtained; or

                     (c) IMDC fails to comply with the R&D Plan or the Clinical
and Regulatory Approval Plan mutually agreed to at the commencement of such
activities for the particular Subject Product or Product Category, and said
failure is not cured by IMDC within 30 days after written notice of the failure
is delivered to IMDC; or

                     (d) IMDC is in material breach of any of its other
obligations with respect to the particular Subject Product or Product Category,
and said breach is not cured within 30 days after written notice of the breach
is delivered to IMDC.

              10.3.2 Either party shall have the right to terminate this
Agreement in its entirety upon notice to the other party in the event the other
party is in material breach of any of its obligations hereunder, including
without limitation the failure of IMDC to make the payments specified in Section
2.1 ("License Fees"), which breach is not cured within thirty (30) days of
written notice of such breach for nonpayment and within sixty (60) days of
written notice of such breach for all other breaches.

              10.3.3 Termination Rights Due To Alternate Product.

                     (a) With respect to any Product Category for which IMDC has
made a Milestone Payment, in the event IMDC enters into an agreement with any
tissue engineering or similar company for the development and/or sale of any
human-based product related to a given Product Category and commences commercial
sales of such alternative product while IMDC still retains license rights to
such Product Category under the terms of this Agreement, then upon such
alternative product sales reaching a cumulative sales threshold of [**
                               ] ATS shall have the right to terminate IMDC's
license rights with respect to such Product Category within 60 days. Provided,
IMDC may retain the rights to such Product Category by continuing to comply with
the terms of this agreement and by paying to ATS a royalty on such alternative
product sales equal to [**               ] of the ATS royalty rate - assuming
for purposes of calculating the payment that all the sales of that alternative
product were based upon ATS Intellectual Property Rights. Provided further, that
the royalty rate on alternative product sales payable to ATS shall decrease [**
               ] but in no event shall [**                        ] of the ATS
royalty rate. At such time as the royalty payable to ATS on alternative product
sales under this section [**                               ]


                                       15

<PAGE>


the ATS royalty rate that would otherwise have been payable, the license shall
[**                    ] for the remainder of the term of the Agreement.

                     (b) In the event IMDC elects to retain its rights and later
desires to terminate the license rights for the Product Category, IMDC may
terminate the Product Category by giving ATS six months prior written notice. In
the event of such notice, ATS may immediately license such rights to any other
third party.

                     (c) Notwithstanding the foregoing, the provisions of this
Section 10.3.3 shall not be applicable to obligations of IMDC relating to
products of Pharming where such obligations existed prior to the date of this
Agreement.

          10.4 Rights Upon Termination. Notwithstanding any other provision of
               -----------------------
this License Agreement, upon any early termination of this License Agreement, in
whole or with respect to a particular Subject Product or Product Category, the
following provisions shall apply, as applicable, to the Subject Products(s) or
Product Category(ies) for which the Agreement is being terminated:

                     (a) except as set forth in Section 10.9 ("License to
Jointly Developed Improvements"), all license rights granted from ATS to IMDC
shall terminate;

                     (b) all payments made by IMDC to ATS shall be retained by
ATS and be non-refundable;

                     (c) all ATS stock issued to IMDC and all stock warrants
granted to IMDC shall remain outstanding and in full force and effect;

                     (d) all intellectual property rights belonging to each
party shall be retained by that party, with neither party having any license
rights to use the other party's intellectual property rights;

                     (e) any regulatory approvals for the Subject Products shall
be transferred from IMDC to ATS, as set forth in Section 3.4 ("Ownership of Data
and Regulatory Approvals");

                     (f) all claims for damages caused by any breach occurring
prior to the termination shall survive and remain enforceable;

                     (g) except as provided in Section 10.6 ("Work in
Progress"), IMDC shall have no further right to use the ATS Patents or the ATS
Know-How; and

                     (h) IMDC shall promptly return to ATS all samples,
documents, information, and other materials which embody or disclose the ATS
Intellectual Property Rights.

          10.5 Survivability. Any such termination shall not relieve either
               -------------
party from any obligations accrued to the date of such termination. The parties'
obligations which have applicability after the termination shall survive the
termination of this License Agreement, such


                                       16

<PAGE>


as those applicable obligations in Section 5.2 ("Ownership of ATS Patents and
ATS Know-How"); Section 5.3 ("Ownership of Improvements"); Article 6
("Indemnity"); Article 7 ("Representations and Warranties; Liability
Limitation"); Article 9 ("Confidentiality") and Section 12.2 ("Arbitration").

          10.6 Work-in-Progress. Upon any such early termination of the license
               ----------------
granted hereunder in accordance with this License Agreement, IMDC and its
Affiliates shall be entitled to finish any work-in-progress and to sell any
completed inventory of Subject Products covered by such license which remains on
hand as of the date of the termination, so long as IMDC pays to ATS the
royalties (if any) and submits the required reports applicable to said
subsequent sales in accordance with the terms and conditions as set forth in
this License Agreement, provided that no such sales shall be permitted after the
expiration of [**          ] after the date of termination.

          10.7 Termination Not Exclusive Remedy. The termination rights shall be
               --------------------------------
in addition to and not in substitution for any other remedies that may be
available to the aggrieved party in connection with default by the other party.
Termination shall not relieve the breaching party from liability and damages to
the aggrieved party for breach of this Agreement. Waiver by the aggrieved party
of a single default or a succession of defaults shall not deprive such party of
any right to terminate this License Agreement arising by reason of any
subsequent default.

          10.8 Change of Control. This License Agreement shall not be terminable
               -----------------
due to a change of control, sale or merger of either ATS, IMDC, or any of their
respective Affiliates, including subsidiaries; and no approval or prior notice
of such event shall be required. Any such change of control, sale or merger
shall not constitute an assignment under Section 11.1, however, prompt notice
thereof shall be given in writing.

          10.9 License to Jointly Developed Improvements. Section 5.3
               -----------------------------------------
("Ownership of Improvements") provides in part that where ATS and IMDC employees
are co-inventors of (in the case of patents) or make an essential contribution
to (in the case of know-how) any Improvement, ATS shall be the sole owner of
such Improvement ("Jointly Developed Improvement"). The parties hereby agree
that upon termination of this Agreement, IMDC shall retain a royalty-free,
non-transferable, [**         ], worldwide license under such Jointly Developed
Improvement(s) to make, use and sell Subject Products.

                                   ARTICLE 11
                             ASSIGNMENT; SUCCESSORS

          11.1 Assignment. Neither this License Agreement nor any rights granted
               ----------
hereunder may be assigned, transferred or sublicensed by either party except
with the prior written consent of the other party, which consent shall not be
unreasonably withheld, except (i) to a party which acquires substantially all of
the assets of the assignor party; (ii) to an Affiliate of a party; or (iii) to a
sublicensee in the case of Urinary Incontinence Products, in any of such cases
consent of the other party is not necessary. Any such purported assignment which
requires consent shall be void without consent.


                                       17

<PAGE>


          11.2 Binding Upon Successors and Assigns. Subject to the limitations
               -----------------------------------
on assignment herein, this License Agreement shall be binding upon and inure to
the benefit of any successors in interest and assigns of ATS and IMDC. Any such
successor or assignee of a party's interest shall expressly assume in writing
the performance of all the terms and conditions of this License Agreement to be
performed by such party.

          11.3 Research & Development Credits. It is the intention of the
               ------------------------------
parties to this Agreement that from a tax standpoint IMDC's investments and
other payments to ATS until the point of commercial sales for a given Product
Category are treated as a "cost sharing" arrangement whereby IMDC is defraying a
portion of the research and development expenditures relating to the Product
Portfolio. It is agreed that such expenditures constitute research and
development expenses as defined in Section 174 of the Internal Revenue Code of
1986, as amended (the "Code"), and that those expenditures should be entitled to
a research and development tax credit by IMDC under Section 41 of the Code.

                                   ARTICLE 12
                               GENERAL PROVISIONS

          12.1 Waiver. The failure of a party to enforce any of its rights under
               -----
this License Agreement or to object to action taken by the other party shall not
constitute the waiver of any rights hereunder. Any waiver by a party hereunder
must be in writing signed by the waiving party. No waiver of any breach of this
License Agreement shall be held to constitute a waiver of any other or
subsequent breach.

          12.2 Arbitration. Any disputes arising from this Agreement (other than
               -----------
validity of the ATS Intellectual Property Rights) shall be resolved through
final and binding arbitration under the rules of the American Arbitration
Association by one arbitrator in Los Angeles, California . The parties will
share the costs of the arbitration, and each party will bear its own expenses
unless the arbitrator determines that a party has acted in bad faith. The
decision of the arbitrator shall be final and non-appealable and may be enforced
in any court of competent jurisdiction. The parties consent to jurisdiction in
any federal or state court located in Los Angeles, California.

          12.3 Notices. All notices shall be deemed complete on transmission by
               -------
facsimile or telecopier or within three business days after the date of mailing
if sent by mail or upon delivery by same day or next day delivery service.
Notices shall be sent to the following addresses unless either party designates
a different address:

     For IMDC:

              INAMED Corporation
              5540 Ekwill Street, Suite D
              Santa Barbara, California 93111
              Attention:  [**     ]
              Attention:  [**           ]
              Phone: [**        ]
              Fax:  [**        ]


                                       18

<PAGE>


     For ATS:

              Advanced Tissue Sciences, Inc.
              10933 North Torrey Pines Road
              La Jolla, California 92037-1005
              Attention:  [**           ]
              Attention:  [**                     ]
              Phone: [**        ]
              Fax:  [**        ]

          12.4 Governing Law. This License Agreement shall be governed by the
               -------------
substantive law of the State of California.

          12.5 Entire Agreement. This License Agreement, together with all
               ----------------
Exhibits attached hereto and with the Heads of Agreement and the other
agreements referenced in the Heads of Agreement represent the entire agreement
of the parties with respect to the subject matter hereof. In the event of any
inconsistency among the provisions of any of the agreements, the terms of the
this License Agreement shall prevail.

          12.6 Amendments. This License Agreement may be amended only by an
               ----------
agreement in writing executed by both parties.

          12.7 Force Majeure. The obligations of the parties under this License
               -------------
Agreement shall be subject to government regulations, significant material
shortages, labor disputes, war, embargoes, and causes beyond the reasonable
control of a party. The party whose performance is prevented as the result of
any of the foregoing shall use continuous and diligent efforts to remedy its
inability to perform.

          12.8 Severability. If one of the provisions of this License Agreement
               ------------
should be declared void or unenforceable, the remaining terms of this License
Agreement shall continue in full force and effect unless such construction is
unreasonable.

          12.9 Recording. If requested by either party, ATS and IMDC shall enter
               ---------
into one or more additional short form license agreements, having terms
consistent with this License Agreement, for recording with the U.S. Patent and
Trademark Office.

          12.10 Counterparts. This License Agreement may be signed in one or
                ------------
more counterparts; signatures may be transmitted by facsimile.


                                       19


<PAGE>


     IN WITNESS WHEREOF, the parties have executed this License Agreement by
their duly authorized representatives to be effective as of the date set forth
above.

                         IMDC:

                                  INAMED CORPORATION,
                                  a Delaware corporation

                                  By: /s/ Ilan K. Reich
                                     -----------------------------------

                                  Title:  President and Co-CEO
                                        --------------------------------



                         ATS:

                                  ADVANCED TISSUE SCIENCES, INC.,
                                  a Delaware corporation



                                  By: /s/ Arthur J. Benvenuto
                                     -----------------------------------

                                  Title: Chairman and CEO
                                        --------------------------------


                                       20


<PAGE>




                                    EXHIBIT A
                                   DEFINITIONS

     As used in the License Agreement, the following terms shall have the
meanings set forth in this Exhibit A.
                           ---------

     Affiliate means (i) any entity directly or indirectly controlling,
     ---------
controlled by or under common control with another entity, (ii) any person or
entity owning or controlling fifty percent (50%) or more of the outstanding
voting securities of an entity, or (iii) any officer, director or partner of an
entity. "Control" shall mean the possession of the power to direct or cause the
direction of the management and the policies of an entity, whether through the
ownership of a majority of the outstanding voting securities or by contract or
otherwise.

     ATS Know-How shall mean all know-how, trade secret, data, processes,
     ------------
procedures, methods, formulas, protocols and information which are not covered
by the ATS Patents or Improvements or any other patent rights of ATS, but which
are known by ATS and are necessary or useful for the commercial exploitation of
the Subject Products.

     ATS Patents shall mean the patents and patent applications listed on
     -----------
Exhibit B hereto, and any and all patents issuing thereon and all foreign
equivalents thereof, owned by or licensed to ATS with the right to sublicense
which disclose subject matter useful or necessary for the commercial
exploitation of the Subject Products. Exhibit B shall be amended from time to
time to add any new intellectual property of ATS which might arise, other than
by business acquisition or merger, that is applicable to the Product Categories.
The term "patents" as used in this License Agreement shall include, without
limitation, all substitutions, continuations, continuations-in-part (to the
extent the invention described in the continuation-in-part application claims
subject matter supported by the original application), divisions, reissues,
extensions and foreign counterparts of the aforementioned.

     ATS Intellectual Property Rights shall mean the ATS Patents and the ATS
     --------------------------------
Know-How.

     Breast Reconstruction Product means a collagen and living cells-based,
     -----------------------------
human matrix product grown outside the body for use in reconstructive surgery of
the human breast, whether following a mastectomy or lumpectomy, or to treat
deformities.

     Burn Treatment Product means a non-viable human dermal matrix and
     ----------------------
fibroblast coated biocompatible scaffold (e.g., "TransCyte(TM)") for use in
cosmetic surgery for the enhancement of normal skin in connection with
procedures such as chemical peels, laser resurfacing or other aesthetic
treatments.

     Clinical and Regulatory Approval Plan shall have the meaning set forth in
     -------------------------------------
Section 3.1 ("R&D Plan; Clinical and Regulatory Approval Plan").



<PAGE>


     Confidential Information means any and all oral or written or tangible
     ------------------------
proprietary or confidential ideas, inventions, information, data, materials and
know-how or the like owned or controlled by IMDC or ATS and disclosed by or on
behalf of one party to the other, from time to time in connection with this
License Agreement, which the other party should reasonably expect to be
proprietary or confidential. A party shall attempt to identify the confidential
status of Confidential Information disclosed hereunder, but the failure to so
mark or identify shall not destroy the confidential or proprietary nature of the
Confidential Information. Without limiting the generality of the foregoing,
ATS's Confidential Information includes, without limitation, all non-published
ATS Intellectual Property Rights.

     Direct Cost shall mean actual costs incurred for labor and materials
     -----------
calculated in accordance with generally accepted cost accounting principles
("GAAP").

     FDA shall mean the United States Food and Drug Administration.
     ---

     First Additional Royalty shall have the meaning set forth in Section 2.4
     ------------------------
("First Additional Royalty").

     First Phase Subject Products shall mean products within the First Phase
     ----------------------------
Product Categories.

     First Phase Product Categories shall mean Burn Treatment Products,
     ------------------------------
Reconstructive Cartilage Products, and Breast Reconstruction Products.

     Gross Profit Margin shall mean Net Sales minus [**               ] divided
     -------------------
by Net Sales, expressed as a percent, all calculated in accordance with GAAP to
the extent applicable and consistent with the past practice of IMDC.

     Heads of Agreement shall have the meaning set forth in Recital F hereof.
     ------------------

     Human Collagen Product shall mean a collagen-based, human matrix injectable
     ----------------------
product for use in the correction of wrinkles and lip enhancement.

     Improvements shall mean future inventions and patent rights and know-how
     ------------
that are discovered by ATS and/or IMDC which are based on the ATS Patents and
ATS Know-How.

     Milestone Payments shall have the meaning set forth in Section 2.2
     ------------------
("Milestone Payments").

     Minimum Royalty shall have the meaning set forth in Section 2.6 ("Minimum
     ---------------
Royalty").

     Net Sales shall mean the amount [**              ] IMDC or any Affiliate on
     ---------
sales of the Subject Products (corrected for [**          ]) after the following
deductions (but only to the extent the [**  ] amount had included such
deductions) all calculated in accordance with GAAP to the extent applicable:

                     (a)  [**
    ];


                                       2

<PAGE>


                     (b) credits or allowances, if any, given or made on account
of the return of the Subject Products by the purchaser, or [**
                                                          ];

                     (c) [**                               ] (but only to the
extent included in the amount billed for Subject Products as specified above);

                     (d) [**          ] (but only to the extent included in the
amount [**  ] for Subject Products as specified above);

                     (e) [**     ] (but only to the extent included in the
amount billed for Subject Products as specified above); and

                     (f) [**     ].

     If the Subject Product is consumed by IMDC in connection with the operation
of a business (excluding the conduct of clinical trials for obtaining regulatory
approval), for example if the IMDC conducts a healthcare treatment service for
patients and consumes the Subject Product in connection with said patient
services, then the normal sale price at which IMDC customarily sells the Subject
Product to third parties shall be deemed to constitute "Net Sales" for such
consumed Subject Product.

     PMA means a Pre-Market Approval application submitted to the United States
     ---
Food and Drug Administration.

     Product Categories shall mean (i) Burn Treatment Products, Reconstructive
     ------------------
Cartilage Products and Breast Reconstruction Products (the First Phase Product
Categories); and (ii) Human Collagen Products and Urinary Incontinence Products
(the Second Phase Product Categories) if IMDC has exercised its option to obtain
a license to the Second Phase Product Categories.

     Product Portfolio means all of the Subject Products.
     -----------------

     R&D Plan shall have the meaning set forth in Section 3.1 ("R&D Plan;
     --------
Clinical and Regulatory Approval Plan").

     Reconstructive Cartilage Product shall mean an allogenic, collagen-based
     --------------------------------
product for use in plastic and reconstructive surgery to provide human cartilage
for aesthetic, cosmetic or other reasons; the primary anticipated application
being rhinoplasty.

     Running Royalty shall have the meaning set forth in Section 2.3 ("Running
     ---------------
Royalty").

     Second Additional Royalty shall have the meaning set forth in Section 2.5
     -------------------------
("Second Additional Royalty").

     Second Phase Product Categories shall mean Human Collagen Products and
     -------------------------------
Urinary Incontinence Products.


                                       3

<PAGE>


     Second Phase Subject Products shall mean products within the Second Phase
     -----------------------------
Product Categories.

     Subject Products shall mean (i) First Phase Subject Products; and (ii)
     ----------------
Second Phase Subject Products if IMDC has exercised its option to obtain a
license to the Second Phase Product Categories.

     Territory is worldwide.
     ---------

     Urinary Incontinence Product shall mean a collagen-based, human matrix
     ----------------------------
bulking product for use in the treatment of urinary incontinence.

     Wall Street Prime Rate means the [**            ] published from time to
     ----------------------
time in The Wall Street Journal newspaper under [**         ] as the [**
        -----------------------
    ] comprising the base [**                   ] posted by at least [**
                         ].


                                       4


<PAGE>


                                    EXHIBIT B

                          INAMED RELATED PATENT RIGHTS


FIRST PHASE PRODUCTS

U.S. AND FOREIGN PATENTS
------------------------

U.S. Pat. No. 4,963,489, issued 10/16/90, entitled "Three-Dimensional Cell and
Tissue Culture System" (Core patent)

U.S. Pat. No. 5,443,950, issued 08/25/95, entitled "Three-Dimensional Cell and
Tissue Culture System" (Transplantation/Implantation methods)

U.S. Pat. No. 5,460,939, issued 10/24/95, entitled "Temporary Living Skin
Replacement" (TRANSCYTE(TM))

U.S. Pat. No. 5,830,708, issued 11/03/98, entitled "Methods for the Production
of a Naturally Secreted Extracellular Matrix" (Isolation methods)

U.S. Pat. No. 5,843,766, issued 12/01/98, entitled "Apparatus for the Growth and
Packaging of Three-Dimensional Tissue Cultures" (TRANSCYTE bioreactor)

U.S. Pat. No. 5,902,741, issued 05/11/99, entitled "Three-Dimensional Cartilage
Cultures" (Cartilage compositions and methods)

Australian Pat. No. 644578, granted 04/06/94, entitled "Three-Dimensional Cell
and Tissue Culture System" (Core patent)

Canadian Pat. No. 1,310,926, granted 12/01/92, entitled "Process for Replicating
Bone Marrow and Other Tissue In Vitro and Using the Same" (Core patent)

European Pat. No. 0 309 456, granted 09/13/95, entitled "Stromal Tissue" (Core
patent; Contracting countries: Austria, Belgium, France, Germany, Italy,
Luxembourg, Netherlands, Sweden, and UK)

Finnish Pat. No. 100249, granted 10/31/97, entitled "Process for Replicating
Bone Marrow" (Core patent)

Hong Kong Pat. No. 1007684, granted 04/23/99, entitled "Stromal Tissue" (Core
patent)

Hungarian Pat. No. 202,578, granted 11/01/91, entitled "Process for Replicating
Bone Marrow" (Core patent)

Israeli Pat. No. 85957, granted 09/25/94, entitled "Living Stromal Tissue
Prepared In Vitro Comprising Stromal Cells and Connective Tissue Proteins" (Core
patent)



<PAGE>


Korean Pat. No. 156571, granted 07/23/98, entitled "Three-Dimensional Cell and
Tissue Culture System" (Core patent)

Japanese Pat. No. 2857392, granted 11/27/98, entitled "Process for Replicating
Bone Marrow" (Core patent)

New Zealand Pat. No. 230572, granted 09/06/89, entitled, "Three-Dimensional Cell
and Tissue Culture System" (Core patent)

Portuguese Patent No. 87136, granted 05/25/92, entitled "Process for Replicating
Bone Marrow and Other Tissue In Vitro and Using the Same" (Core patent)

Romanian Pat. No. 106655, granted 04/15/87, entitled, "Process for Replicating
Bone Marrow" (Core patent)

South African Pat. No. 87/2805, granted 04/21/87, entitled "Process for
Replicating Bone Marrow" (Core patent)

Spanish Pat. No., 2,009,894, granted 04/04/88, entitled "Replicating Bone
Marrow" (Core patent)

Norwegian Pat. No. 179181, granted 08/21/96, entitled " entitled "Process for
Replicating Bone Marrow" (Core patent)

Australian Pat. No. 689605, granted 07/16/98, entitled, "Three-Dimensional
Cartilage Cultures" (Cartilage compositions and methods)

New Zealand Pat. No. 288467, granted 02/09/99, entitled, "Three-Dimensional
Cartilage Cultures" (Cartilage compositions and methods)


U.S. AND FOREIGN APPLICATIONS
-----------------------------

[**

                                   ]

[**
                                                              ]

[**

                   ]



<PAGE>


[**

                                                 ]

[**

                                        ]

[**
                                                            ]

[**

                ]

[**
                               ]

[**
                   ]

[**
      ]

[**
                                                        ]

[**
                                                        ]

[**
                                                        ]

[**
                                                        ]

[**
                                                        ]

[**

                                                ]

[**

                                                ]


<PAGE>


[**

                                                ]

[**

                                                ]

[**

                                                ]

[**

                                                ]

[**

            ]

[**

        ]

[**

            ]

[**

        ]

[**

            ]

[**

            ]

[**


                             ]

[**

          ]

[**

                                    ]


<PAGE>


SECOND PHASE PRODUCTS
---------------------

[**
                                                                     ]

[**
                      ]



<PAGE>


                                    EXHIBIT C

                           PRICING FORMULA & MECHANISM

The pricing for facial wrinkle products is set forth in the table below. Initial
pricing will be based upon the assumptions in the model containing a [** ]
average selling price. Identified variables will be adjusted quarterly as real
experience is determined.

INAMED & ADVANCED TISSUE SCIENCES

PRICING FOR FACIAL WRINKLE
PRODUCTS

-------------------------------------------------------------------------------
ATS INITIAL COST ASSUMPTIONS

[**                                     [**] per roller bottle
        ]
[**           ]                         [**] per roller bottle
                                        ---
[**                     ]               [**] per roller bottle


[**                                     [**      ] per roller
                     ]                       bottle
-------------------------------------------------------------------------------

FORMULA PRICE:                          [**  ] per roller bottle
[**                                     [**           ]
       ]
                                         [**

                                                                   ]
--------------------------------------------------------------------------------

FLOOR                                   [**  ] per roller bottle
PRICE:
[**                        ]            [**           ]
                                         [**

                                                                   ]
--------------------------------------------------------------------------------

CAP PRICE:                              [**







                                                         ]
--------------------------------------------------------------------------------


<PAGE>




MODEL AT VARIOUS ASPS:          *  Denotes an assumption which will be adjusted
                                   [**      ], based on actual experience

<TABLE>

    <S>                     <C>       <C>       <C>       <C>        <C>       <C>       <C>       <C>        <C>

    ASP*                    [**  ]    [**  ]    [**  ]    [**  ]     [**  ]    [**  ]    [**  ]    [**  ]     [**  ]

    [**  ]                   [** ]     [** ]     [** ]     [** ]      [** ]     [** ]     [** ]     [** ]      [** ]

    [**       ]              [** ]     [** ]     [** ]     [** ]      [** ]     [** ]     [** ]     [** ]      [** ]

    [**
              ]              [** ]     [** ]     [** ]     [** ]      [** ]     [** ]     [** ]     [** ]      [** ]

    [**            ]          [**]      [**]      [**]      [**]       [**]      [**]      [**]      [**]      [** ]

    [**              ]
      [**  ]                 [** ]     [** ]     [** ]     [** ]      [** ]     [** ]     [** ]     [** ]      [** ]
      [**    ]              [**  ]    [**  ]    [**  ]    [**  ]     [**  ]    [**  ]    [**  ]    [**  ]    [**   ]

    [**              ]        [**]      [**]      [**]      [**]       [**]      [**]      [**]      [**]       [**]

    [**              ]       [** ]      [**]      [**]      [**]       [**]      [**]      [**]      [**]       [**]

    [**              ]
      [**  ]                 [** ]     [** ]     [** ]     [** ]      [** ]     [** ]     [** ]     [** ]      [** ]
      [**    ]              [**  ]    [**  ]    [**  ]    [**  ]     [**  ]    [**  ]    [**  ]    [**  ]    [**   ]

    [**
                       ]      [**]      [**]      [**]      [**]       [**]      [**]      [**]      [**]       [**]

    [**


                 ]

</TABLE>