UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON D. C. 20549

                                   FORM 10-QSB

(Mark One)

[X]   Quarterly report under Section 13 or 15(d) of the Securities and Exchange
      Act of 1934 for the quarterly period ended September 30, 2005.

[ ]   Transition report pursuant to Section 13 or 15(d) of the Exchange Act for
      the transition period from _____ ____________ to ____________.

Commission File Number: 000-50746

                            Cord Blood America, Inc.
                            ------------------------
               (Exact name of registrant as specified in charter)

                                     Florida
                                     -------
         (State or other jurisdiction of incorporation or organization)

                                   65-1078768
                                   ----------
                      (I.R.S. Employer Identification No.)

          9000 W. Sunset Boulevard, Suite 400, West Hollywood, CA 90069
          -------------------------------------------------------------
                    (Address of principal executive offices)

                                 (310) 432-4090
                                 --------------
              (Registrant's Telephone Number, including Area Code)

Check whether the registrant: (1) has filed all reports required to be filed by
Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding
12 months (or for such shorter period that the registrant was required to file
such reports), and (2) has been subject to such filing requirements for the past
90 days. YES [X] NO [ ]

State the number of shares outstanding of each of the issuer's classes of common
equity, as of November 11, 2005: 39,733,765 shares of common stock, par value
$.0001 per share.

Transitional Small Business Disclosure Format: YES [ ] NO [X]

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

INDEX TO FORM 10-QSB

<TABLE>
<S>                                                                                             <C>
PART I. FINANCIAL INFORMATION

Item 1.  Condensed Consolidated Financial Statements (unaudited)                                3

Condensed Consolidated Balance Sheet (unaudited) as of September 30, 2005                       3

Condensed Consolidated Statements of Operations (unaudited) for the nine months
ended September 30, 2005 and 2004                                                               4

Condensed Consolidated Statements of Operations (unaudited) for the three months
ended September 30, 2005 and 2004                                                               5

Condensed Consolidated Statements of Cash Flows (unaudited) for the nine months
ended September 30, 2005 and 2004                                                               6

Notes to Condensed Consolidated Financial Statements (unaudited)                                8

Item 2.  Management's Discussion and Analysis of Financial Condition and
Results of Operations (including cautionary statement)                                         20

Item 3.  Controls and Procedures                                                               43

PART II. OTHER INFORMATION                                                                     43

Item 1.  Legal Proceedings                                                                     43

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds                           44

Item 3.  Defaults Upon Senior Securities                                                       46

Item 4.  Submission of Matters to a Vote of Securities Holders                                 46

Item 5.  Other Information                                                                     46

Item 6.  Exhibits and Reports on Form 8-K                                                      46

Signatures                                                                                     49
</TABLE>

                                        2

<PAGE>

ITEM 1.  CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
         -------------------------------------------------------
                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                      Condensed Consolidated Balance Sheet
                                   (Unaudited)

                               September 30, 2005

<TABLE>
<S>                                                                                        <C>
                                     ASSETS

Current assets:
   Cash                                                                                   $  1,945,289
   Accounts receivable, net of allowance for doubtful accounts of $40,680                       68,506
                                                                                          ------------
         Total current assets                                                                2,013,795

Property and equipment, net                                                                     16,472
Deposits                                                                                        21,394
Goodwill                                                                                        12,077
Other assets                                                                                    39,294
                                                                                          ------------
         Total assets                                                                     $  2,103,032
                                                                                          ============

                         LIABILITIES AND CAPITAL DEFICIT

Current liabilities:
   Accounts payable                                                                       $    295,540
   Accrued expenses                                                                            211,810
   Deferred revenue                                                                            199,597
   Due to stockholders                                                                         110,419
   Capital lease obligations, current portion                                                    4,683
   Loan payable                                                                                 14,948
   Promissory notes payable, net of unamortized discount of $1,972,772                       1,777,228
                                                                                          ------------
         Total current liabilities                                                           2,614,225

Capital lease obligations, net of current portion                                                3,174
                                                                                          ------------
         Total liabilities                                                                   2,617,399

Capital deficit:
   Preferred stock, $.0001 par value, 5,000,000 shares
      authorized, no shares issued and outstanding                                                   -
   Common stock, $.0001 par value, 100,000,000 shares
      authorized 73,733,765 shares issued and outstanding                                        7,373
   Additional paid-in capital                                                               17,029,408
   Common stock held in treasury stock, 34,000,000 shares                                  (11,560,000)
   Accumulated deficit                                                                      (5,991,148)
                                                                                          ------------
         Total capital deficit                                                                (514,367)
                                                                                          ------------
         Total liabilities and capital deficit                                            $  2,103,032
                                                                                          ============
</TABLE>

See the accompanying notes to condensed consolidated financial statements.

                                        3

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                 Condensed Consolidated Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                 NINE-MONTH            NINE-MONTH
                                                PERIOD ENDED          PERIOD ENDED
                                             SEPTEMBER 30, 2005    SEPTEMBER 30, 2004
                                             ------------------    ------------------
<S>                                            <C>                   <C>
Revenue                                        $    1,895,595        $      967,308

Cost of services                                   (1,431,981)             (705,481)
                                               --------------        --------------

      Gross profit                                    463,614               261,827

Administrative and selling expenses                (3,996,890)           (1,118,357)
                                               --------------        --------------

      Loss from Operations                         (3,533,276)             (856,530)
                                               --------------        --------------

Interest expense                                     (453,591)              (17,211)
                                               --------------        --------------

   Net loss before income taxes                    (3,986,867)             (873,741)

Income taxes                                                -                     -
                                               --------------        --------------

   Net loss                                    $   (3,986,867)       $     (873,741)
                                               ==============        ==============

Basic and diluted loss per share               $        (0.12)       $        (0.03)
                                               ==============        ==============

Weighted average common shares outstanding         32,883,303            26,024,198
                                               ==============        ==============
</TABLE>

See the accompanying notes to condensed consolidated financial statements.

                                        4

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                 Condensed Consolidated Statements of Operations
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                THREE-MONTH           THREE-MONTH
                                                PERIOD ENDED          PERIOD ENDED
                                             SEPTEMBER 30, 2005    SEPTEMBER 30, 2004
                                             ------------------    ------------------
<S>                                            <C>                   <C>
Revenue                                        $      431,685        $      338,859

Cost of services                                     (345,388)             (246,950)
                                               --------------        --------------

      Gross profit                                     86,297                91,909

Administrative and selling expenses                (1,475,465)             (548,885)
                                               --------------        --------------

      Loss from Operations                         (1,389,168)             (456,976)
                                               --------------        --------------

Interest expense                                     (312,882)               (5,429)
                                               --------------        --------------

   Net loss before income taxes                    (1,702,050)             (462,405)

Income taxes                                                -                     -
                                               --------------        --------------

   Net loss                                    $   (1,702,050)             (462,405)
                                               ==============        ==============

Basic and diluted loss per share               $        (0.04)       $        (0.02)
                                               ==============        ==============

Weighted average common shares outstanding         38,073,897            26,487,312
                                               ==============        ==============
</TABLE>

See the accompanying notes to condensed consolidated financial statements.

                                        5

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                 Condensed Consolidated Statements of Cash Flows
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                NINE-MONTH           NINE-MONTH
                                                               PERIOD ENDED         PERIOD ENDED
                                                            SEPTEMBER 30, 2005   SEPTEMBER 30, 2004
                                                            ------------------   ------------------
<S>                                                           <C>                     <C>
Cash flows from operating activities:
   Net loss                                                   $  (3,986,867)          (873,741)
   Adjustments to reconcile net loss to net cash
      used in operating activities:
         Issuance of stock and stock options for services         1,206,734             15,000
         Provision for uncollectible accounts                         9,365              1,195
         Depreciation                                                 7,833                  -
         Amortization of discount on warrants                       309,137              1,911
         Changes in operating assets and liabilities:
           Accounts receivable                                       25,638            (36,721)
           Deposits                                                  (1,394)                 -
           Other assets                                             (37,232)           (13,875)
           Accounts payable                                         (94,698)            23,170
           Accrued expenses                                         (59,408)            45,835
           Deferred revenue                                         (26,125)            76,356
                                                              -------------           --------

         Net cash used in operating activities                   (2,647,017)          (760,870)

Cash flows from investing activities:
   Purchase of property and equipment                                (4,853)                 -
   Redemtion of certificates of deposit                              75,000                  -
                                                              -------------           --------

         Net cash provided by investing activities                   70,147                  -

Cash flows from financing activities:
   Proceeds from the issuance of notes payable                    4,545,000            750,000
   Payments on notes payable                                       (419,499)                 -
   Payments on capital lease obligations                             (1,990)                 -
   Net repayments on line of credit                                  (6,484)           (20,452)
   Proceeds from advance from officer                                29,531             42,158
   Payments on advance from officer                                 (17,700)           (41,231)
   Proceeds from issuance of common stock                           273,085            254,998
                                                              -------------           --------

         Net cash provided by financing activities                4,401,943            985,473
                                                              -------------           --------

         Net increase in cash                                     1,825,073            224,603

Cash, at beginning of period                                        120,216             48,226
                                                              -------------           --------

Cash, at end of period                                            1,945,289            272,829
                                                              =============           ========
</TABLE>

See the accompanying notes to condensed consolidated financial statements.

                                        6

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

           Condensed Consolidated Statements of Cash Flows, continued
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                                              NINE-MONTH           NINE-MONTH
                                                                             PERIOD ENDED         PERIOD ENDED
                                                                          SEPTEMBER 30, 2005   SEPTEMBER 30, 2004
                                                                          ------------------   ------------------
<S>                                                                          <C>                    <C>
Supplemental disclosures of cash flow information:
   Cash paid for interest                                                    $     112,939           7,404
                                                                             =============          ======

Supplemental disclosures of non-cash investing and
   financing activities:
      Discount on issuance of debt with detachable warrants                      2,218,884          45,873
                                                                             =============          ======

      Issuance of shares for the acquisition of Family Marketing, Inc.              16,184               -
                                                                             =============          ======

      Acquisition of computer equipment under capital lease obligations      $       2,058               -
                                                                             =============          ======

      Debt repaid through issuance of common stock                           $   1,360,553               -
                                                                             =============          ======
</TABLE>

See the accompanying notes to condensed consolidated financial statements.

                                        7

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                               SEPTEMBER 30, 2005

(1)   BASIS OF PRESENTATION

The accompanying unaudited financial statements of Cord Blood America, Inc. have
been prepared in accordance with accounting principles generally accepted in the
United States of America for interim financial information and with Item 310 of
Regulation S-B. Accordingly, they do not include all of the information and
footnotes required by accounting principles generally accepted in the United
States of America for complete financial statements. The financial statements
reflect all normal recurring adjustments, which, in the opinion of management,
are considered necessary for a fair presentation of the results for the periods
shown. The results of operations for the periods presented are not necessarily
indicative of the results expected for the full fiscal year or for any future
period. Certain prior period amounts have been reclassified to conform to the
current period presentation. The information included in these unaudited
financial statements should be read in conjunction with Management's Discussion
and Analysis and Plan of Operations contained in this report and the audited
financial statements and accompanying notes included in the Company's Annual
Report on Form 10-KSB for the fiscal year ended December 31, 2004.

(2)   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

(a) BASIS OF CONSOLIDATION

The consolidated financial statements include the accounts of the Cord Blood
America, Inc. and its wholly owned subsidiaries, Cord Partners, Inc. ("Cord"),
CBA Professional Services, Inc. D/B/A Bodycells, Inc. ("Services"), CBA
Properties, Inc. ("Properties"), Career Channel Inc, D/B/A Rainmakers
International ("Rain") and Family Marketing, Inc. ("Family"), (collectively
"CBA"). Significant inter-company balances and transactions have been eliminated
upon consolidation.

(b) ORGANIZATION AND DESCRIPTION OF BUSINESS

Cord Blood America, Inc., formerly D&A Lending, Inc., was incorporated in the
State of Florida on October 12, 1999. CBA's headquarters are located in Los
Angeles, California.

Cord Partners, Inc., the cord blood division of CBA, specializes in providing
private cord blood stem cell preservation services to families.

CBA Professional Services, Inc. recently filed and was granted a D/B/A request
with the State of Florida under the name BodyCells, Inc. for the purpose of
offering new services, but is not currently operational.

                                        8

<PAGE>

CBA Properties, Inc. was formed to hold the corporate trademarks and any other
intellectual property.

Effective February 28, 2005, Cord Blood America, Inc. entered into a purchase
and sale agreement to purchase 100% of the outstanding shares of Rain through a
share exchange. Because Cord Blood America, Inc. and Rain were entities under
common control, this transaction was accounted for in a manner similar to
pooling of interests. The shareholders of Rain were issued 3,656,000 shares of
common stock in Cord Blood America, Inc. for all of their outstanding shares of
Rain. Accordingly, the consolidated financial statements for the nine months
ended September 30, 2004 have been restated to reflect this transaction as if
the combining companies had been consolidated for all periods presented.

Rainmakers International, the marketing division of CBA, specializes in
delivering leads to corporate customers through national television and radio
campaigns.

Family Marketing, Inc., the internet advertising division of CBA, specializes in
delivering leads to corporate customers in the business of family based products
and services.

The accompanying financial statements have been prepared on a going-concern
basis, which contemplates the realization of assets and the settlement of
liabilities and commitments in the normal course of business. See Note 2 to the
financial statements for a discussion of management's plans and intentions.

(c) DEFERRED REVENUE

Deferred revenue for Cord consists of payments for enrollment in the program and
processing of umbilical cord blood by customers whose samples have not been
collected, as well as the pro-rata share of annual storage fees for customers
whose samples were stored during the year. Deferred revenue for Rain and Family
consists of payments for per inquiry leads that have not yet been provided.

(d) REVENUE RECOGNITION

We recognize revenue under the provisions of Staff Accounting Bulletin ("SAB")
104 "Revenue Recognition". Cord provides a combination of products and services
to customers. This combination arrangement is evaluated under Emerging Issues
Task Force (Issue No. 00-21, "Revenue Arrangements with Multiple Deliverables,"
("EITF 00-21"). EITF 00-21 addresses certain aspects of accounting for
arrangements under multiple revenue generating activities. CBA elected early
adoption of EITF 00-21.

Cord recognizes revenue from both enrollment fees and processing fees upon the
completion of processing. Storage fees are recognized ratably over the
contractual storage period.

Rain generates revenue from packaged advertising services, including media
buying, marketing and advertising production services. Rain's advertising
service revenue is recognized when the media ad space is sold and the
advertising occurs. Rain's advertising production service revenue is derived
through the production of an advertising campaign including, but not limited to
audio and video production, establishment of a target market and the development
of an advertising campaign.

During the first quarter of fiscal 2005, we reevaluated our application of
Emerging Issues Task Force No. 99-19, "Reporting Revenue Gross as a Principal
versus Net as an Agent" (EITF 99-19), to the presentation of our revenues
generated from packaged advertising services provided to our clients. Based on
our evaluation, we have changed the manner in which we report revenues earned
from certain client contracts in the Statement of Operations to the "Gross"
basis. Prior to the first

                                        9

<PAGE>

quarter of 2005, we reported such revenues on a "Net" basis. In order to provide
consistency in all periods presented, revenues and costs of revenues for all
prior periods have been reclassified to conform to the current period
presentation. Such reclassifications had no effect on previously reported
results of operations, total assets or accumulated deficit.

The effect of such reclassification on CBA's net revenue for the three and nine
months ended September 30, 2004 is as follows:

<TABLE>
<CAPTION>
                                                                    Three-month period   Nine-month period
                                                                     ended September     ended September
                                                                         30, 2004            30, 2004
                                                                    ------------------   -----------------
<S>                                                                 <C>                  <C>
Revenue, as previously reported                                     $          402,875   $         820,520
Impact of reclassification to reflect gross revenue presentation                64,016             146,783
                                                                    --------------------------------------
Revenue, as reclassified                                                       466,891             967,308
                                                                    ======================================
</TABLE>

Our revenue recognition policy involves significant judgments and estimates
about the ability to collect. We assess the probability of collection based on a
number of factors, including past transaction history and/or the
creditworthiness of our clients' customers, which is based on current published
credit ratings, current events and circumstances regarding the business of our
client's customer and other factors that we believe are relevant. If we
determine that collection is not reasonably assured, we defer revenue
recognition until such time as collection becomes reasonably assured, which is
generally upon receipt of cash payment.

(e) COST OF SERVICES

Costs for Cord are incurred as umbilical cord blood is collected. These costs
include the transport of the umbilical cord blood from the hospital to the lab,
the lab's processing fees and royalties. Cord expenses costs in the period
incurred and does not defer any costs of sales. Costs for Rain include
commercial productions costs, lead generation costs and media buys. Costs for
Family include lead generation.

(f) ACCOUNTING FOR STOCK COMPENSATION PLAN

CBA accounts for its stock option plans using the intrinsic value based method
of accounting, under which no compensation expense is recognized for stock
option awards granted at fair market value. For purposes of pro forma
disclosures under Statement of Financial Accounting Standards No. ("SFAS") 123,
Accounting for Stock-Based Compensation, as amended by SFAS 148, Accounting for
Stock-Based Compensation Transition and Disclosure, the estimated fair value of
the stock options is amortized to compensation expense over the options' vesting
period. The following table illustrates the effect on net loss and loss per
share if the fair value based method had been applied to all outstanding awards
in each period:

                                       10

<PAGE>

<TABLE>
<CAPTION>
                                                                                       Nine-month      Nine-month
                                                                                       period ended    period ended
                                                                                        September       September
                                                                                         30, 2005        30, 2004
                                                                                      -------------   -------------
<S>                                                                                   <C>             <C>
Net loss, as reported                                                                 $  (3,986,867)       (873,742)
Add: stock-based employee compensation expense included in reported net loss net of
   related tax effects                                                                       37,489              --
Deduct: total stock-based employee compensation expense determined under the fair
   value method for all awards, net of related tax effects                                 (243,207)        (20,288)
                                                                                      -------------   -------------
   Pro forma net loss                                                                 $  (4,192,585)       (894,030)
                                                                                      =============   =============
Basic and diluted loss per common share, as reported                                  $       (0.12)          (0.03)
                                                                                      =============   =============
Basic and diluted loss per common share, pro forma                                    $       (0.13)          (0.03)
                                                                                      =============   =============
</TABLE>

<TABLE>
<CAPTION>
                                                                                       Three-month     Three-month
                                                                                       period ended    period ended
                                                                                        September       September
                                                                                         30, 2005       30, 2004
                                                                                      -------------   -------------
<S>                                                                                   <C>             <C>
Net loss, as reported                                                                 $  (1,723,535)       (462,405)
Add: stock-based employee compensation expense included in reported net loss net of
   related tax effects                                                                       34,436              --
Deduct: total stock-based employee compensation expense determined under the fair
   value method for all awards, net of related tax effects                                 (209,149)        (10,144)
                                                                                      -------------   -------------
   Pro forma net loss                                                                 $  (1,898,248)       (472,549)
                                                                                      =============   =============
Basic and diluted loss per common share, as reported                                  $       (0.04)          (0.02)
                                                                                      =============   =============
Basic and diluted loss per common share, pro forma                                    $       (0.05)          (0.02)
                                                                                      =============   =============
</TABLE>

The weighted average fair value at the date of grant for the options granted
during the three months ended September 30, 2005 was approximately $.29 per
common share. The Company estimates the fair value of each stock option at the
grant date using the Black-Scholes option-pricing model based on the following
assumptions:

                   Risk free interest rate      4.06% - 4.32%
                   Expected life                    10 years
                   Dividend yield                          0%
                   Volatility                         194.85%

                                       11

<PAGE>

(g) NET LOSS PER SHARE

Net loss per common share is calculated in accordance with SFAS No. 128,
Earnings per Share. Basic net loss per share is computed by dividing the net
loss by the weighted average common shares outstanding of 32,883,303 and
26,024,198 for the nine months ended September 30, 2005 and 2004, respectively
and 38,073,897 and 26,487,312 for the three months ended September 30, 2005 and
2004, respectively. The Company has 29,472,357 and 1,750,000 outstanding options
to acquire common stock at September 30, 2005 and 2004, respectively, which are
not included in the computation of net loss per common share because the effects
of inclusion are anti-dilutive.

(h) NEW ACCOUNTING PRONOUNCEMENTS

In December 2004, the FASB issued Statement No. 123R, "Share-Based Payment,"
which requires companies to recognize in the statement of operations all
share-based payments to employees, including grants of employee stock options,
based on their fair values. Accounting for share-based compensation transactions
using the intrinsic method supplemented by pro forma disclosures will no longer
be permissible. The new statement will be effective for public entities in
periods beginning after December 15, 2005. The impact of adopting FASB Statement
No. 123R has not yet been determined.

(2) MANAGEMENT'S PLANS AND INTENTIONS

CBA's consolidated financial statements have been prepared assuming it will
continue as a going concern. CBA has experienced recurring net losses from
operations, which losses have caused an accumulated deficit of approximately
$5,991,000 as of September 30, 2005. In addition, CBA has consumed cash in its
operating activities of approximately $2,647,017 and has a working capital
deficit of approximately $600,000 as of September 30, 2005. These factors, among
others, raise substantial doubt about CBA's ability to continue as a going
concern.

Management has been able, thus far, to finance the losses, as well as the growth
of the business, through private placements of its common stock, the issuance of
debt and proceeds from the Equity Distribution Agreement and Securities Purchase
Agreement. CBA is continuing to attempt to increase revenues within its core
businesses. In addition, CBA is exploring alternate ways of generating revenues
through potentially offering additional stem cell services and acquiring other
businesses in the stem cell industry. The ongoing execution of CBA's business
plan is expected to result in operating losses over the next twelve months.
There are no assurances that CBA will be successful in achieving its goals of
diversifying revenue streams and acheiving profitability.

In view of these conditions, CBA's ability to continue as a going concern is
dependent upon its ability to meet its financing requirements, and to ultimately
achieve profitable operations. Management believes that its current and future
plans provide an opportunity to continue as a going concern. The accompanying
consolidated financial statements do not include any adjustments

                                       12

<PAGE>

relating to the recoverability and classification of recorded assets, or the
amounts and classification of liabilities that may be necessary in the event CBA
cannot continue as a going concern.

(3) ACCRUED EXPENSES

The components of accrued expenses at September 30, 2005 are summarized as
follows:

                                                         September
                                                         30, 2005
                                                       -------------
            Accrued salaries and benefits              $     107,842
            Accrued consulting and professional fees          25,823
            Deferred Rent                                     22,383
            Other                                             55,762
                                                       -------------
                                                       $     211,810
                                                       =============

(4) NOTES AND LOANS PAYABLE

In August, September and October 2004, CBA entered into three unsecured
promissory notes with an unrelated party. The first note (the "First Note") for
$500,000 bearing interest at 8% per annum, the second note (the "Second Note")
for $250,000 bearing interest at 10% per annum and the third note (the "Third
Note") for $250,000 bearing interest at 10% to the same party.

The Second Note and the Third Note each contained detachable warrants to
purchase 500,000 shares (1,000,000 in total) of common stock at an exercise
price of $.1875 per share and can be exercised at any time prior to September
2009. The estimated relative fair value of the warrants of approximately $84,000
was recorded as a debt discount and is being amortized to interest expense over
the terms of the Second Note and the Third Note.

At September 30, 2005, $250,000 was outstanding on the Third Note. The First
Note and the Second Note totaling $750,000 were re-paid in full. During the nine
month period ended September 30, 2005, $92,291 of interest had been incurred and
$91,250 of interest had been paid on these notes. During the three month period
ended September 30, 2005, $16,875 of interest has been incurred and $65,958 of
interest has been paid on these notes. At September 30, 2005, $1,041 of interest
related to the Third Note is included in accrued expenses in the accompanying
balance sheet.

The entire principal of the Third Note together with any and all unpaid interest
accrued thereon, was paid in full October 15, 2005.

During the three months ended September 30, 2005, CBA re-paid $1,360,553 in
interest and principal by issuing 3,568,734 shares of common stock on an
outstanding loan with Cornell Capital Partners LP. At September 30, 2005, $0 was
owed relating to these loans.

                                       13

<PAGE>

In March 2005, Cord received a $70,000 advance on future credit card sales.
Repayment terms on this advance call for 17% of certain credit card sales until
the sum of $94,682 has been paid. At September 30, 2005, the outstanding
principal balance on the advance was $20,228.

On September 9, 2005, CBA entered into a Securities Purchase Agreement (the "SP
Agreement") with Cornell Capital Partners LP ("Cornell). Pursuant to the SP
Agreement, CBA issued $5,000,000 in secured convertible debentures (the
"Debentures"), of which $3,500,000 was delivered on September 9, 2005 and
$1,500,000 is to be funded upon the filing of a future registration statement.
The Debentures mature in 24 months and accrue interest at 12% per year. The
Debentures are convertible into CBA's common stock at a pre-determined share
price of $0.35 per share. The Debentures are secured by substantially all of
CBA's assets. At September 30, 2005, $3,500,000 was outstanding relating to
these Debentures and is included in the accompanying financial statements.

In connection with the SP Agreement, three warrants were issued to Cornell for
the purchase of a total of 22,570,000 shares of CBA's common stock. All three
warrants vest immediately and are exercisable over a 5-year period, expiring on
September 9, 2010. The first two warrants total 14,285,000 shares of common
stock at an exercise price of $0.35 per share. The third warrant is for
8,285,000 shares of common stock at an exercise price of $0.40 per share. The
estimated fair value of the warrants is approximately $2,994,000, of which
approximately $2,096,000, represents the pro-rated portion of the debt issued
through September 30, 2005, was recorded as a debt discount and is being
amortized to interest expense over the life of the Debentures. At the date of
issuance, the Company's common stock price was $.31 per share. At September 30,
2005, approximately $125,000 of the discount has been amortized to interest
expense relating to these warrants.

(5) COMMITMENTS AND CONTINGENCIES

AGREEMENTS

Cord is operating under an agreement with a not-for-profit company to process,
test and store all umbilical cord blood samples collected. The agreement has a
10-year term, beginning June 30, 2002, and can be terminated by either party
giving a 90-day notice. If the agreement is not terminated within 120-days of
the end of the initial term, the agreement will renew on an annual basis for
successive one-year terms.

In February 2004, Cord entered into a Receivables Agreement with a financing
company whereby, at the customer's discretion, the products and services
purchased from Cord can be financed through an unrelated finance company. Cord
paid a $500 origination fee in conjunction with executing the Receivables
Agreement. During the three months ended September 30, 2005 and 2004, Cord sold
approximately $15,000 and $14,400, respectively in receivables. As of September
30, 2005, approximately $11,000 is held for default by the financing company,
which is included in accounts receivable. The receivables will be released to
Cord in January or July, whichever occurs first, following the one year
anniversary of when the receivable was initially sold. During the three months
ended September 30, 2005 and 2004, Cord incurred approximately $1,000 and
$1,200, respectively in discounts relating to the sale of these receivables.
Effective September 1, 2005, Cord is no longer offering financing through the
above third party to its customers.

                                       14

<PAGE>

In March 2004, Cord entered into a Patent License Agreement with the holder of
patents utilized in the collection, processing, and storage of umbilical cord
blood to settle litigation against Cord for alleged patent infringements. The
Patent License Agreement calls for royalties of 15% of processing and storage
revenue, with a minimum royalty of $225 per specimen collected, on all specimens
collected after January 1, 2004 until the patents expire in 2010. During the
three months ended September 30, 2005 and 2004, Cord incurred approximately
$48,000 and $40,000 respectively, in royalties relating to the Patent License
Agreement. During the nine months ended September 30, 2005 and 2004, Cord
incurred approximately $143,000 and $72,000 respectively, in royalties to the
Patent License Agreement. At September 30, 2005, approximately $48,000 is
included in accounts payable relating to these fees.

EMPLOYMENT AGREEMENTS

CBA entered into five-year employment agreements with two executive officers,
the Chairman of the Board and Chief Executive Officer ("CEO") and the President
and Chief Operating Officer ("COO"). Pursuant to the employment agreements, the
CEO and the COO received annual salaries of $125,000 through December 31, 2004.
The annual salaries increased to $150,000 as of January 1, 2005 and will
increase to $175,000 as of January 1, 2006. The annual salaries are thereafter
adjusted in accordance with changes in the cost of living index. The employment
agreements also entitle the CEO and COO to receive performance bonuses from time
to time determined by the Board of Directors and certain fringe benefits. The
employment agreements are subject to non-competition and confidentiality
requirements.

CBA has also entered into a one-year employment agreement with the Vice
President of CBA ("VP"). Pursuant to the agreement, the VP receives an annual
salary of $80,000 through April 2006.

In July 2005, CBA entered into five year employment agreements with two
executive officers. Pursuant to the employment agreements, the Chief Financial
Officer, ("CFO") and the Chief Technology Officer ("CTO") of the Company each
receive annual salaries of $96,000 through December 31, 2005, increasing to
$108,000 as of January 1, 2006 and $120,000 as of January 1, 2007. The salaries
are adjusted in accordance with changes in the cost of living index. The CFO and
CTO are entitled to receive performance bonuses as may from time to time be
determined by the Board of Directors and certain fringe benefits. The employment
agreements are subject to non-competition and confidentiality requirements.

LEGAL PROCEEDINGS

In June 2005, CBA received a complaint filed in the United States District Court
of the Western District of Washington by Merrill Corporation, a Minnesota
corporation, naming Cord Blood America and Cord Partners (collectively "CBACP")
as defendants. The complaint alleges that CBACP owes Merrill Corporation, the
Plaintiff, $101,738 for work performed and products provided plus attorneys'
fees, costs, applicable service charges and penalties. The complaint seeks
judgment in the principal amount, plus applicable service charges and penalties;
an award of post-judgment interest on all amounts; attorney's fees and costs and
for such other and further relief as the Court deems just and equitable.

                                       15

<PAGE>

In September, CBACP submitted a settlement proposal to the Plaintiff and
received a counter proposal. On October 21, 2005, CBACP offered to fully and
finally settle the matter in the amount of $70,000 payable in four monthly
installments of $15,000 and a final payment of $10,000. The Plaintiff has yet to
respond.

CBACP has accrued $61,450 in relation to this litigation based on the invoices
it has received to date.

(6) SALES CONTRACTS

Cord has sales contracts totaling approximately $26,000 and $89,000 as of
September 30, 2005 and 2004, respectively, relating to customers who have
initiated a sale with Cord for which Cord has performed no services. In
accordance with Cord's revenue recognition policy, these sales contracts are
excluded from the accompanying financial statements. A receivable and deferred
revenue will be recorded when the collection kit is shipped and/or payment is
received from the customer. These sales contracts will be recognized as revenue
and deferred revenue as the umbilical cord blood is processed and stored.

(7) RELATED PARTY TRANSACTIONS AND COMMITMENTS

In October 2001, Rain received $25,000 as a non-interest bearing advance from an
officer of CBA. This advance has not been repaid and is included in due to
stockholders in the accompanying financial statements.

In January 2003, Cord entered into a Web Development and Maintenance Agreement
(the "Web Agreement") for the development and maintenance of a website with a
company whose president is a member of the board of directors of CBA. The Web
Agreement stipulates that Cord does not own the website; however, Cord maintains
a license to utilize the site as long as the Web Agreement is in effect. The Web
Agreement calls for commissions to be paid on sales and requests for information
resulting in a sale generated through the website. The Web Agreement has an
initial three-year term and renews automatically for additional three-year
periods unless either party provides written notice at least 30 days prior to
the end of the term.

In March 2004, Cord cancelled the existing Web Agreement and signed a new Web
Design and Maintenance Agreement. The new agreement replaces the commission
payments with a flat monthly fee of $5,000 per month from March 2004 through May
2004 and $10,000 per month from June 2004 until termination of the Web
Agreement. The new agreement also calls for the issuance of 150,000 stock
options with an exercise price of $0.25 per share, issued in April 2004,
followed by another 150,000 stock options to be issued one year later at an
exercise price of $1.00 per share which were issued subsequent to September 30,
2005. The new Web Agreement expires in March 2006.

During the nine-months ended September 30, 2005 and 2004, Cord incurred
approximately $104,900 and $21,000, respectively, relating to the web
development agreements. At September 30, 2005, Cord owed approximately $23,500
relating to these web development agreements which is included in accounts
payable in the accompanying financial statements.

                                       16

<PAGE>

In April 2005, Family entered into an exchange agreement with Family Marketing,
LLC where Family must pay quarterly royalty fees to Family Marketing, LLC. The
president of Family Marketing, LLC is a member of the board of directors of CBA.
Royalty fees are calculated as 2% of gross profit. During the nine and three
month periods ended September 30, 2005, Family incurred approximately $1,100 and
$900 respectively, in royalty fees.


(8) STOCK OPTION AGREEMENTS

In April 2005, the board of directors of CBA approved the Company's 2005 Stock
Option Plan (the "Option Plan"), which authorized the issuance of up to
8,000,000 options to purchase shares of CBA's common stock to employees and
directors of the company.

During the nine-months ended September 30, 2005, CBA issued 1,278,900 options
under the plan. The options issued have an exercise price per share equal to the
weighted volume average price of the quarter they were awarded for. The vesting
period for options awarded to officers is four years while the vesting period
for options awarded to other employees is one year. The intrinsic value on
700,000 of these options is approximately $130,000, of which approximately
$13,800 has been recognized as an expense for the three-months ended September
30, 2005 and approximately 16,800 has been recognized as an expense for the nine
months ended September 30, 2005 in the accompanying financial statements.

In July 2005, 98,331 options with an exercise price of $0.18 per share were
awarded to various officers for loans made to the company. All of the loans were
repaid within the same month. The vesting period of the options is one year. The
total intrinsic value of these options is approximately 31,500 of which
approximately $7,900 was recorded in the accompanying financial statements.

In July 2005, 160,000 options with an exercise price of $0.25 and 138,888
options with an exercise price of $0.18 were issued for carrying past due
balances due from services provided per the Web Development Agreement. These
past due balances were paid in October 2005. The vesting period of the options
are six months and one year respectively. The fair value of these options is
approximately $176,500 of which approximately $62,000 has been recognized as an
expense in the accompanying financial statements.

On July 1, 2005, CBA issued options to purchase 19,722 shares of common stock to
Family Marketing, LLC for previously carrying past due amounts owed by the
Company. The options are 100% vested on the first anniversary of the grant date
and have an exercise price of $0.18 per share. The fair value of these options
is approximately $10,000 of which approximately $2,500 has been recognized as an
expense in the accompanying financial statements.

In August 2005, 184,848 options with an exercise price of $0.33 per share were
issued to an officer of CBA for loans made to the company. The loan was repaid
within the same month. The vesting period of the options is four years. The
intrinsic value of these options is approximately $68,000 of which approximately
$12,000 has been recognized as an expense in the accompanying financial
statements.

In August 2005, CBA entered into a stock option agreement in exchange for
business consulting services in relation to establishing and defining new
payment options. The agreement calls for the issuance of 5,000 options which
vest over a one-year period at an exercise price of $0.33 per share. The fair
value of these options is approximately $1,800 of which approximately $300 has
been recognized as an expense in the accompanying financial statements.

                                       17

<PAGE>

In August 2005, 200,000 options with an exercise price of $0.25 per share were
issued to a director of the company for a loan to the company that occurred in
January 2005. The loan was repaid in March 2005. 50,000 options vest immediately
while the vesting period for the remaining 150,000 options is one year. The
intrinsic value of these options is approximately $24,000 of which approximately
$6,800 has been recognized as an expense in the accompanying financial
statements.

In August 2005, as recognition of their service, two of CBA's directors were
each granted options to purchase 50,000 shares of our common stock at an
exercise price of $0.25 per share. The vesting period of the options is one
year.

In August 2005, CBA's new director was granted options to purchase 100,000
shares of our common stock at an exercise price of $0.25 per share. The vesting
period of the options is one year.

In September 2005, 1,600,000 options at $0.31 were issued to the Chief Executive
Officer of CBA in exchange for that officer placing 7,770,000 shares of common
stock owned by such officer in escrow to be used as collateral for the
Securities Purchase Agreement. The vesting period of the options is one year.
The intrinsic value of these options is approximately $32,000 of which
approximately $1,300 has been recognized as an expense in the accompanying
financial statements.

On September 30, 2005. 12,000 options with an exercise price of $0.51 per share
and 50,000 options for $0.45 per share were awarded to employees of CBA. The
vesting period of the options is one year.

(9) PREFERRED STOCK

At inception, CBA had 5,000,000 shares of preferred stock authorized. In March
2004, the board of directors of CBA amended the company's articles of
incorporation to establish a $.0001 par value for the preferred stock. No
preferred stock has been issued to date.

(10) COMMON STOCK

In July 2005, 1,000,000 warrants were exercised by Cornell Capital Partners. The
warrants had an exercise price of $0.20 per share.

During the three months ended September 30, 2005, CBA issued a total of
3,568,734 shares to repay $1,360,553 in outstanding debt and interest to Cornell
Capital Partners LP.

On September 1, 2005, 60,000 shares were issued to a consultant for $12,500 in
investor relations services performed from May 2005 through September 2005.

On September 7, 2005, 34,000,000 shares of common stock were issued to Cord
Blood America to serve as collateral to the Securities Purchase Agreement
entered into with Cornell. These shares are held as treasury shares, in the
accompanying financial statements.

(11) SEGMENT REPORTING

SFAS 131 "Disclosures about Segments of an Enterprise and Related Information,"
requires that public business enterprises report financial and descriptive
information about its reportable

                                       18

<PAGE>

operating segments. Operating segments are components of an enterprise about
which separate financial information is available that is evaluated regularly by
the chief operating decision makers in deciding how to allocate resources and in
assessing performance.

CBA has three operating segments. Cord generates revenues related to the
processing and preservation of umbilical cord blood. Rain generates revenues
related to television and radio advertising. Family generates revenues related
to internet advertising. All of its long-lived assets are located in, and
substantially all of its revenues are generated from within, the United States
of America. The table below presents certain financial information by business
segment for the nine-month period ended September 30, 2005:

<TABLE>
<CAPTION>
                        Umbilical Cord     Radio/TV      Internet      Segments     Consolidated
                             Blood       Advertising   Advertising       Total          Total
                        --------------   -----------   -----------   ------------   ------------
<S>                     <C>              <C>           <C>           <C>            <C>
Revenue from External
Customers               $      875,342   $   997,920   $    22,333   $  1,895,595   $  1,895,595
Interest Expense               445,435         8,156             0        453,591        453,591
Depreciation and
Amortization                     7,689           144             0          7,833          7,833
Segment Income (Loss)       (3,997,800)       31,044       (20,111)    (3,986,867)    (3,986,867)
Segment Assets          $    2,019,848   $    36,407   $    46,777   $  2,103,032   $  2,103,032
                        ==============   ===========   ===========   ============   ============
</TABLE>

The table below presents certain financial information by business segment for
the nine-month period ended September 30, 2004:

<TABLE>
<CAPTION>
                        Umbilical Cord     Radio/TV      Segments    Consolidated
                             Blood       Advertising      Total         Total
                        --------------   -----------   -----------   ------------
<S>                     <C>              <C>           <C>           <C>
Revenue from External
Customers               $      478,920   $   488,388   $   967,308   $    967,308
Interest Expense                     0        17,211        17,211         17,211
Depreciation and
Amortization                         0             0             0              0
Segment Income (Loss)         (912,825)       39,082      (873,741)      (873,741)
Segment Assets          $      347,407   $    20,207   $   367,614   $    367,614
                        ==============   ===========   ===========   ============
</TABLE>

                                       19

<PAGE>

The table below presents certain financial information by business segment for
the three-month period ended September 30, 2005:

<TABLE>
<CAPTION>
                        Umbilical Cord     Radio/TV      Internet      Segments     Consolidated
                             Blood       Advertising   Advertising       Total          Total
                        --------------   -----------   -----------   ------------   ------------
<S>                     <C>              <C>           <C>           <C>            <C>
Revenue from External
Customers               $      296,677   $   115,458        19,550   $    431,685   $    431,685
Interest Expense               311,083         1,799             0        312,882        312,882
Depreciation and
Amortization                     3,024             4             0          3,028          3,028
Segment Income (Loss)       (1,641,053)      (64,402)      (18,079)    (1,723,535)    (1,723,535)
Segment Assets          $    2,019,848   $    36,407   $    46,777   $  2,103,032   $  2,103,032
                        ==============   ===========   ===========   ============   ============
</TABLE>

The table below presents certain financial information by business segment for
the three-month period ended September 30, 2004:

<TABLE>
<CAPTION>
                        Umbilical Cord     Radio/TV      Segments    Consolidated
                             Blood       Advertising      Total         Total
                        --------------   -----------   -----------   ------------
<S>                     <C>              <C>           <C>           <C>
Revenue from External
Customers               $      228,664   $   110,195   $   338,859   $    338,859
Interest Expense                     0         5,429         5,429          5,429
Depreciation and
Amortization                         0             0             0              0
Segment Income (Loss)         (462,875)          470      (462,405)      (462,405)
Segment Assets          $      347,407   $    20,207   $   367,614   $    367,614
                        ==============   ===========   ===========   ============
</TABLE>

ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS - NOTE: LAST 2 FISCAL YEARS
        ----------------------------------------------------------------

FORWARD LOOKING STATEMENT:

In addition to the historical information contained herein, we make statements
in this Quarterly Report on Form 10-QSB that are forward-looking statements.
Sometimes these statements will contain words such as "believes," "expects,"
"intends," "should," "will," "plans," and other similar

                                       20

<PAGE>

words. Forward-looking statements include, without limitation, our ability to
increase income streams, to grow revenue and earnings, and to obtain additional
cord blood banking revenue streams. Actual results could differ materially from
those projected in the forward-looking statements as a result of a number of
risks and uncertainties. These risks and uncertainties include: (1) whether we
will continue as a going concern; (2) whether we will continue to increase
revenues within our core business; (3) whether we will generate revenues through
offering additional stem cell services and acquiring other businesses in the
stem cell industry; (4) whether we will be successful in achieving our goals of
diversifying revenue streams and working towards profitability; (5) whether we
are able to meet our financing requirements, and to ultimately achieve
profitable operations (6) whether our current and future plans will provide an
opportunity to continue as a going concern; (7) whether we will create
tremendous value in building a database of qualified leads with specific
demographic information which can be used to market a number of products and
services; (8) whether we will be able to further monetize our website traffic
through the use of our web properties, and therefore offset these increasing
costs; (9) whether we will continue to carry a deficit until such time that we
can greatly increase our assets and reduce our significant liabilities; (10)
whether we will be able to reduce our working capital deficit over the
long-term; (11) whether our current funding will partially be used to supplement
the remaining 70% of operating cash needed through the end of 2006; (12) whether
a portion of the funding will also be used to promote additional channels of
stem cell services to further diversify our revenue streams; (13) whether other
channels that will furnish a more favorable financial model; (14) whether a
portion of the funding will be used for mergers and acquisitions of companies in
the stem cell industry; (15) whether the combination of the capital raised
through the issuance of the convertible debentures and our cash flows from
operations will be sufficient through 2006; (16) whether we move towards
profitability throughout 2006; (17) whether we further streamline our current
operations, through discovering and implementing more profitable stem cell
channels and by drastically reducing expenses related to raising additional
capital; (18) whether additional financing will be available, and, if available,
whether it will take the form of debt or equity; (19) whether Rain's loans will
be paid in full by the end of 2005; (20) whether Rain will not continue to
experience a cash flow deficiency in the future; (21) whether Rain will be able
to fund its own operations through cash flows from operations again in the very
near future; (22) whether our new programs will have a positive impact in the
future; (23) whether we find new and improved ways to produce positive financial
results that are complimentary to our business; (24) whether the launch of the
Annual Payment Option in September 2005 will have a positive impact; (25)
whether our new Annual Payment Option will open the door so that the average
American family can afford to bank their child's cord blood stem cells; (26)
whether our marketing initiatives will promote the new payment plan and create
awareness both with existing prospects and other expectant families outside the
company database; (27) whether our Annual Payment Option creates a new
demographic of customers who were not previously able to take advantage of our
cord blood preservation services; (28) whether there is an increase in potential
customers as well as an increase in new customers; (29) whether we can improve
our overall conversion rate and cost for acquiring clients; (30) whether we
continue to develop new channel sales opportunities through the addition of
strategic referral partnerships with Obstetrics and Gynecological practices and
other healthcare professionals; (31) whether continuing to develop relationships
with medical professionals who work closely with expectant families will further
enhance our long-term growth and profitability; (32) whether we are able to
accelerate the growth of our channel partnership programs by engaging a firm
with existing medical sales representatives on staff to present Cord Partners'
Physician

                                       21

<PAGE>

Partnership Programs on a national scale to key healthcare providers; (33)
whether we add long form television infomercial buys, Hispanic media buys and
call center management services over the next six months; (34) whether we add
call center management services during the fourth quarter of 2005; (35) whether
Family is able to take advantage of the huge profit potential in the lead
generation business as more advertisers are moving to a fixed cost advertising
methodology to control their return on investment; (36) whether our campaigns
greatly increase the number of leads generated for all of our clients through
our web properties over the next 12 months; (37) whether we will continue to add
new advertisers to our sites and expand our network to accommodate these
advertisers; (38) whether we will continue to re-market to our opt in database
of leads using both online and offline mediums to produce additional revenue;
(39) whether we are able to diversify our service offerings within the stem cell
industry by offering additional sources of adult stem cells for private banking;
(40) whether sources such as adipose tissue and peripheral blood have the
potential to make a positive financial impact on our company; and (41) whether
we continue to actively evaluate opportunities to acquire organizations within
the stem cell industry that make both strategic and financial sense. These
statements are not guarantees of our future performance and are subject to
risks, uncertainties, and other important factors, certain of which are
discussed herein under the heading "Factors That May Affect Future Operating
Results" that could cause our actual performance or achievements to be
materially different from those expressed in any forward-looking statements made
by or on our behalf. Given these uncertainties, undue reliance should not be
placed on these forward-looking statements. The Company's past performance is
not necessarily indicative of its future performance. The Company does not
undertake, and the Company specifically disclaims any obligation, to update any
forward-looking statements to reflect occurrences, developments, events or
circumstances after the date of such statement.

The following information should be read in conjunction with our September 30,
2005 consolidated financial statements and related notes thereto included
elsewhere in the quarterly report and with our consolidated financial statements
and notes thereto for the year ended December 31, 2004 and the related
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" contained in our annual Report on Form 10-KSB for the year ended
December 31, 2004. We also urge you to review and consider our disclosures
describing various risks that may affect our business, which are set forth under
the heading "Risk Factors Related to our Business" in this report and in our
annual Report on Form 10-KSB for the year ended December 31, 2004.

INTRODUCTION:

This management's discussion and analysis of financial condition and results of
operations is intended to provide investors with an understanding of Cord Blood
America's ("CBA's") past performance, financial condition and prospects. The
following will be discussed and analyzed:

      o     Overview
      o     Financial Highlights for First Nine Months of 2005
      o     Financial Highlights for Third Quarter of 2005
      o     Financial Condition and Results of Operations
      o     Critical Accounting Policies and Use of Estimates
      o     Liquidity and Capital Resources
      o     Business Outlook

                                       22

<PAGE>

      o     Risk Factors Related to Our Business
      o     Off-Balance Sheet Arrangements

OVERVIEW:

CBA is an umbilical cord blood stem cell preservation company with a particular
focus on the acquisition of customers in need of family based products and
services. We also provide television, radio and internet advertising services to
businesses that sell family based products and services.

We operate three core businesses:

      o     the umbilical cord blood stem cell preservation operations that are
            conducted by Cord Partners, Inc. ("Cord")
      o     the television and radio advertising operations that are conducted
            by Career Channel, Inc. D/B/A Rainmakers International ("Rain")
      o     the internet advertising operations that are conducted by Family
            Marketing, Inc. ("Family")

The umbilical cord blood stem cell preservation operations provide umbilical
cord blood banking services to expectant parents throughout all 50 United
States. The company's corporate headquarters are located in Los Angeles,
California. All cord blood testing, processing, and storage is conducted by our
outsourced laboratory partner, Bergen Community Regional Blood Center, located
in Paramus, New Jersey. We provide the following services to each customer:

      o     COLLECTION MATERIALS. We provide a medical kit that contains all of
            the materials necessary for collecting the newborn's umbilical cord
            blood at birth and packaging the unit for transportation. The kit
            also provides for collecting a maternal blood sample for later
            testing.
      o     FULL-TIME PHYSICIAN AND CUSTOMER SUPPORT. We provide 24-hour
            consulting services to customers as well as to physicians and labor
            and delivery personnel, providing any instruction necessary in
            regards to the collection of the cord blood.
      o     TRANSPORTATION. We coordinate the transportation of the cord blood
            unit to our laboratory partner, Community Blood Services,
            immediately following birth. This process utilizes a private medical
            courier, Quick International, for maximum efficiency and security.
      o     COMPREHENSIVE TESTING. At the laboratory, the cord blood sample is
            tested for stem cell concentration levels, bacteria and blood type.
            The maternal blood sample is tested for infectious diseases. We
            report these results to the newborn's mother.
      o     CORD BLOOD PRESERVATION. After processing and testing, the cord
            blood unit is cryogenically frozen in a controlled manner and stored
            in liquid nitrogen for potential future use. Data indicates that
            cord blood retains viability and function for at least fifteen years
            when stored in this manner and theoretically could be maintained at
            least as long as the normal life span of an individual.

Cord earns revenue two ways: through a one-time enrollment and processing fee
and through an annually recurring storage and maintenance fee.

The television and radio advertising operations provide advertising and direct
marketing customers a range of services including:

                                       23

<PAGE>

      o     the placement of advertising in television and radio outlets
      o     the production of advertising content, including television
            commercials and radio copy, which is outsourced to third party
            production companies
      o     advertising and marketing consulting services which can include
            assistance in not only developing an advertising program, but
            helping the client to develop the particular product or service,
            determine the appropriate market and design and implement an overall
            marketing program and strategy

A majority of Rain's revenues are realized via direct response media buys and
per inquiry campaigns. For direct response, we currently buy television and
radio schedules for our clients on a national and local level. Our national
television outlets include DIRECTV, DISH Network, Comcast Digital, national
cable networks and various local cable interconnects. We buy time with numerous
national radio networks including Premiere Radio, Clear Channel, Westwood One
and Jones Radio Network, along with a variety of local radio stations. For per
inquiry advertising, we focus on national campaigns. The placements are made
using our internal media buyers and other agencies with whom we have formed
strategic marketing alliances. We also generate revenues through the commercial
production aspect of our business using production partners in Florida and
California. Rain's operations are located in Carlsbad, CA.

Family, the internet advertising operations, owns and operates several lead
generation web properties that produce internet leads for CBA along with other
family based companies. The primary purpose of Family is to be the internet
marketing arm for CBA. Website visitors are directed to our web properties
through several methods including natural search, paid search, email and
banners. We also utilize affiliate marketers to help drive traffic to our web
properties while only incurring a fee if a qualified lead is generated. Our
websites require a registration process which is beneficial in the following
ways:

      o     By registering the user with the website, the user consents to
            receive follow up marketing from us on behalf of our advertisers
      o     By pre-qualifying registered users for certain offers based upon
            their demographic information
      o     By creating value in building a database of qualified leads with
            specific demographic information which can be used to market a
            number of products and services, enabling us to further monetize our
            website traffic

We earn revenue on a cost per lead basis for any leads generated through our web
properties. The cost of acquiring leads for Cord through traditional internet
advertising methods has become increasingly expensive. Through the use of our
web properties, we are able to monetize the cost of acquiring these leads and
therefore offset these increasing costs. Family operates out of our corporate
office in Los Angeles, CA.

FINANCIAL HIGHLIGHTS FOR FIRST NINE MONTHS OF 2005:

                                       24

<PAGE>

      o     Consolidated revenues increased to $1,895,595 for the nine months
            ended September 30, 2005 compared to $967,308 for the nine months
            ended September 30, 2004.
      o     Total assets increased to $2,103,032 as of September 30, 2005 from
            $334,074 as of December 31, 2004 and $367,614 as of September 30,
            2004.
      o     Revenue of Cord increased to $867,911 for the nine months ended
            September 30, 2005 compared to $478,920 for the nine months ended
            September 30, 2004.
      o     New customers of Cord for the nine months ended September 30, 2005
            totaled 554 compared to 391 for the nine months ended September 30,
            2004.

FINANCIAL HIGHLIGHTS FOR THIRD QUARTER OF 2005:

      o     Consolidated revenues increased to $431,685 for the three months
            ended September 30, 2005 compared to $338,859 for the three months
            ended September 30, 2004.
      o     Revenue of Cord increased to $286,692 for the three months ended
            September 30, 2005 compared to $228,664 for the three months ended
            September 30, 2004.
      o     Revenue of Family increased 83% for the three months ended September
            30, 2005 compared to the three months ended June 30, 2005.
      o     New customers of Cord for the three months ended September 30, 2005
            totaled 179 compared to 139 for the three months ended September 30,
            2004.

FINANCIAL CONDITION AND RESULTS OF OPERATIONS:

As of September 30, 2005, total assets increased 470% to $2.1 million compared
to approximately $368,000 as of September 30, 2004. Items of significant
increase include a 613% increase in cash and a 2895% increase in property and
equipment. The increase in cash was due to the receipt of $3.5 million in
funding from the Securities Purchase Agreement with Cornell Capital Partners
which was received in September. Cord has also experienced an increase in total
year to date cash receipts from operations compared to this same period last
year of approximately 105% from an increased volume of enrollment and processing
fees as well as storage renewal fees. As of September 30, 2004, we owned
virtually no property or equipment. Since then, we have expanded and in the
process have purchased computers, computer equipment, software, office furniture
and other office equipment. The purchase of these items support the increase in
property and equipment.

As of September 30, 2005, total liabilities increased 114% to approximately
$2,617,000 as compared to approximately $1,223,000 as of September 30, 2004.
Items of significant increase include a 84% increase in accounts payable which
is attributed to outstanding bills currently in dispute (see Legal Proceedings
section) as well as past due bills of six vendors which to date, have been or
will be paid in accordance with agreed upon payment plans. There was also a 330%
increase in accrued expenses. The increase is comprised of accrued interest on
the Cornell convertible debenture, accrued rent due to rent recognition using
the straight line method, an increase in expense accruals related to September
bills not received as of the end of the quarter and

                                       25

<PAGE>

the accrual of shares due as part of a consulting agreement not yet registered
at September 30, 2005. In addition, there was a 566% increase in capital lease
obligations that consist of eleven new computers and a server. Finally, there
was a 152% increase in notes payable due to the addition of the convertible
debentures in September 2005.

At September 30, 2005, we had a working capital deficit of $600,430. We will
continue to carry a deficit until such time, if ever, that we can increase our
assets and reduce our significant liabilities which are currently composed of
notes payable, accounts payable and accrued expenses. While reducing the working
capital deficit is our long-term goal we do not foresee this occurring in the
near future.

RESULTS OF OPERATIONS FOR THE NINE MONTHS ENDED SEPTEMBER 30, 2005 COMPARED TO
THE NINE MONTHS ENDED SEPTEMBER 30, 2004

For the nine months ended September 30, 2005, revenue increased 96% to
approximately $1.9 million compared to approximately $968,000 for the nine
months ending September 30, 2004. There was a slight increase in revenue with
the acquisition of Family in April 2005 but the majority of the increase was due
to increased revenue of both Cord and Rain. We believe Cord experienced an
increase in revenue due to:

      o     increased marketing efforts via print media and the internet
      o     consistent communication with prospective customers through
            telephone, direct mail and e-mail
      o     the addition of salespeople allowing us to reach a greater number of
            prospective clients and schedule more frequent follow-ups
      o     the redesign of the packaging of our umbilical cord blood collection
            kit to increase awareness of the Cord Partners brand in hospitals
            and among consumers
      o     an increase in repeat business from existing customers having
            additional children
      o     an increase in referrals by existing customers
      o     a price increase for cord blood enrollment and processing in January
            2005 from $1,595 to $1,695

We believe Rain experienced an increase in revenue due to:

      o     the addition of a major customer, Innovative Tax Relief, in January
            2005
      o     a number of existing customers increasing their direct response
            weekly budgets after successful campaigns on national radio and
            television outlets with Rain
      o     the expansion of our radio and television per inquiry networks
            generating more lead volume for our per inquiry clients, creating a
            spike in our per inquiry revenues

For the nine months ended September 30, 2005, cost of services increased 103% to
approximately $1.4 million compared to approximately $705,000 for the nine
months ended September 30, 2004. There was a slight increase in cost of services
with the acquisition of Family in April 2005 but the majority of the increase
was due to costs directly associated with increased sales of both Cord and Rain.
We believe Cord experienced an additional increase in cost of services due to:

                                       26

<PAGE>

      o     the increase in cost our newly packaged medical kit
      o     our inability to take an early payment discount on our lab
            processing and storage fees for most of 2005
      o     an increase in the average medical courier service delivery fee

We believe Rain experienced an additional increase in cost of services due to:

      o     our cost of commercial production increased
      o     our cost per inquiry increased

For the nine months ended September 30, 2005, gross profit increased 77% to
approximately $464,000 compared to approximately $262,000 for the nine months
ending September 30, 2004. Gross profit percentage was 24% for the nine months
ended September 30, 2005 compared to 27% for the nine months ending September
30, 2004. The decrease in gross profit percentage is due to the specific
increase in costs described above.

For the nine months ended September 30, 2005, administrative and selling
expenses increased 257% to approximately $3,997,000 million as compared to
approximately $1,118,000 million for the nine months ending September 30, 2004.

Administrative and selling increased as a result of several factors. First, we
added and retained eight new employees since the nine months ended September 30,
2004. Also, compensation was increased for two executive officers and stock was
awarded as compensation to some executives during the first nine months of 2005.
Therefore, we incurred an increase in wage, payroll burden and employee stock
expense during the first nine months of 2005 of approximately $944,000. The
addition of the new employees contributed to the approximate $76,300 increase in
other employee related expenses such as telephone and internet service expenses,
computer service expense, parking expense and office supplies expense.
Independent contractor expense increased by approximately $60,900. Insurance
expense increased by approximately $23,900 as the result of additional coverage
required by the Patent License Agreement with PharmaStem and the addition of a
Directors and Officers policy. We incurred approximately $271,000 in finance and
bank related charges for fees on carried balances and fees from the addition of
five bank accounts and three company credit cards. Some of these fees were paid
with options or shares of our stock. Expenses for development, maintenance and
hosting of our's websites increased by approximately $84,800 per the Web
Development and Maintenance Agreement with Gecko Media. Travel expense increased
by approximately $16,700. Additionally, we increased the number of print
publications we advertised in leading to an increase of approximately $35,000 in
print advertising expense during the first nine months of 2005. The production
of marketing materials and associated postage and delivery expenses increased by
approximately $74,100 due to extensive distribution of consumer information
guides, increased direct mailings and the dispersal of brochures to medical
professionals. We increased our internet advertising which led to an increase of
approximately $60,400 in web advertising expense during the first nine months of
2005. During the first nine months of 2005, we engaged a public relations firm
and in doing so incurred an increase in public relations expense of
approximately $20,500. In October 2004, we relocated to a larger, traditional
office space, which contributed to the increase in rent of approximately $49,300
in the first nine months of 2005. During the first nine months of 2005, an
extensive audit was performed on Rain, which was acquired on February 28, 2005.
The audit, as well as other public company obligations, contributed to the
increase in professional fees for auditing and legal services of approximately
$157,400. We also incurred approximately $480,300 in professional fees in
relation to our financing agreements as well as business process consulting.
There were approximately $293,900 in other public company related expenses such
as investor relations, filings, listings and stock transfer and issuance
expenses. Depreciation expense increased approximately $8,000. Bad debt expense
increase approximately $18,700. Of the expenses above, finance fees on carried
balances, audit and legal fees related to the acquisition of Rain and
professional fees related to our financing agreements are non-recurring fees.

For the nine months ended September 30, 2005, interest expense increased
approximately 2535% to approximately $453,600 compared to approximately $17,200
for the nine months ended September 30, 2004. There increase was in relation to
promissory notes issued as part of the Equity Distribution Agreement as well as
a promissory note issued to a director of CBA.


                                       27

<PAGE>

RESULTS OF OPERATIONS FOR THE THREE MONTHS ENDED SEPTEMBER 30, 2005 COMPARED TO
THE THREE MONTHS ENDED SEPTEMBER 30, 2004

For the three months ended September 30, 2005, revenue increased 27% to
approximately $431,000 compared to approximately $339,000 for the three months
ending September 30, 2004. There was a slight increase in revenue with the
acquisition of Family in 2005, as well as a 5% increase in Rain revenue. The
majority of the increase was due to increased revenue of Cord. We believe Cord
experienced this increase due to:

      o     increased marketing efforts via print media and the internet
      o     consistent communication with prospective customers through
            telephone, direct mail and e-mail
      o     the addition of salespeople allowing us to reach a greater number of
            prospective clients and schedule more frequent follow-ups
      o     the redesign of the packaging of our umbilical cord blood collection
            kit to increase awareness of the Cord Partners brand in hospitals
            and among consumers
      o     an increase in repeat business from existing customers having
            additional children
      o     an increase in referrals by existing customers
      o     a price increase for cord blood enrollment and processing from
            $1,595 to $1,695

For the three months ended September 30, 2005, cost of services increased 40% to
approximately $345,000 as compared to approximately $247,000 for the three
months ending September 30, 2004. There was a slight increase in cost of
services with the acquisition of Family in 2005 but the majority of the increase
is due to costs directly associated with increased sales of both Cord and Rain.
We believe Cord experienced an additional increase in cost of services due to:

      o     the increase in cost our newly package medical kit
      o     our inability to take an early payment discount on our lab
            processing and storage fees during the third quarter of 2005
      o     an increase in the average medical courier service delivery fee

We believe Rain experienced an additional increase in cost of services due to:

      o     our cost per inquiry increased

For the three months ended September 30, 2005, gross profit decreased 6% to
approximately $86,300 as compared to approximately $91,900 for the three months
ending September 30, 2004. The decrease in gross profit is due to decreased
margins on most sales due to the above cost increases. Gross profit percentage
was 20% for the nine months ended September 30, 2005 as

                                       28

<PAGE>

compared to 27% for the nine months ending September 30, 2004. The decrease in
gross profit percentage is due to the specific increase in costs described
above.

For the three months ended September 30, 2005, administrative and selling
expenses increased 169% to approximately $1,475,000 as compared to approximately
$548,900 for the three months ending September 30, 2004. Administrative and
selling expenses increased as a result of several factors. First, we added and
retained eight new employees since the three months ended September 30, 2004.
Also, compensation was increased for two executive officers subsequent to
September 20, 2004 and stock was awarded as compensation to some executives
during the third quarter of 2005. Therefore, we incurred an increase in wage,
payroll burden and employee stock expense during the first nine months of 2005
of approximately $234,900. The addition of the new employees contributed to the
approximate $17,000 increase in other employee related expenses such as
telephone and internet service expenses, computer service expense, parking
expense and office supplies expense. We incurred approximately $65,400 in
finance and bank related charges for fees on carried balances and fees from the
addition of five bank accounts and three company credit cards. We increased
advertising expense by approximately $40,800 in the third quarter of 2005 as
compared to the third quarter of 2004 by increasing the number of promotional
materials we mailed to prospects and the volume of print advertising during that
time. During the third quarter of 2005, we engaged a public relations firm and
in doing so incurred an increase in public relations expense of approximately
$20,500. In October 2004, we relocated to a larger, traditional office space,
which contributed to the increase in rent of approximately $17,900 in the third
quarter of 2005. We also incurred approximately $139,100 in professional fees in
relation to our financing agreements as well as business process consulting.
There were approximately $360,600 in commitment fees associated with funding
during the three months ended September 30, 2005. There were also $20,600 in
other public company related expenses such as investor relations, filings,
listings and stock transfer and issuance expenses.

For the three months ended September 30, 2005, interest expense increased
approximately 5694% to approximately $312,900 compared to approximately $5,400
for the three months ended September 30, 2004. There increase was due to
interest on promissory notes that were issued in relation to the Equity
Distribution Agreement.

For the three months ended September 30, 2005 and 2004, we experienced a loss of
approximately $1,702,000 and $462,000, respectively. Some factors leading to the
increase in Net Loss due to:

      o     extensive advertising to create brand awareness and educate
            consumers on our services
      o     tremendous growth leading to the addition of employees, related
            expenses and larger office space
      o     massive expenses incurred during the process of going public
      o     legal and auditing expenses incurred in regards to the acquisition
            of Rain
      o     professional fess and interest as a result of our need to acquire
            outside funding

CRITICAL ACCOUNTING POLICIES AND USE OF ESTIMATES:

The Notes to the Consolidated Financial Statements contain a summary of CBA's
significant accounting policies, including a discussion of recently issued
accounting pronouncements. Several of these policies are considered to be
important to the portrayal of CBA's financial condition, since they require
management to make difficult, complex or subjective judgments, some of which may
relate to matters that are inherently uncertain. These policies include
determination of the level of

                                       29

<PAGE>

allowance for bad debt, deferred revenue and revenue recognition policies. There
weren't any material changes to our critical accounting policies during the
three months ended September 30, 2005.

Additional information about accounting policies can be found in Item 1
"Financial Information - Notes to Condensed Consolidated Financial Statements"

LIQUIDITY AND CAPITAL RESOURCES:

At September 30, 2005, we had $1,945,289 of cash. We currently collect cash
receipts from operations through three of our subsidiaries: Cord, Rain and
Family. Cord's cash flows from operations are not currently sufficient to fund
operations that include expenditures such as legal, audit and capital raising
fees that benefit the entire organization. Because of this shortfall, we have
had to obtain additional capital through other sources. On September 9, 2005, we
received $3,500,000 in funding from the issuance of convertible debentures to
Cornell Capital Partners in a private placement. As part of the agreement, we
are to receive an additional $1,500,000 in funding two days prior to the filing
of our registration statement with the Securities and Exchange Commission. The
$5,000,000 raised will partially be used to supplement the operating cash needed
through the end of 2006. Approximately $1,059,000 has been used to fully repay
outstanding notes and approximately $200,000 was used to pay past due balances
with various vendors. A portion of the funding will also be used to promote
additional channels of stem cell services to further diversify our revenue
streams. Through our initial efforts, we believe there are other channels that
may furnish a more favorable financial model so we will continue to explore
these possibilities. Finally, a portion of the funding may be used for mergers
and acquisitions of companies in the stem cell industry. We have been and will
continue to evaluate various companies throughout the industry for an
acquisition opportunity that makes both strategic and financial sense.

We project the combination of the capital raised through the issuance of the
convertible debentures and our cash flows from operations will be sufficient to
fund our operations through 2006. It is our goal to move towards profitability
throughout 2006. We feel we can do this through further streamlining our current
operations, through discovering and implementing more profitable stem cell
channels and by reducing expenses related to raising additional capital.

If our cash flows from operations are significantly less than projected, then we
will need to request an advance under the Equity Distribution Agreement in order
to fund operations. We may also need to look to outside sources for additional
funding. Any required financing may not be available, and, if available, it may
take the form of debt or equity. Should we secure such financing, it could have
a negative impact on our financial condition and our shareholders. The sale of
debt would, among other things, adversely impact our balance sheet, increase our
expenses and increase our cash flow requirements. The sale of equity would,
among other things, result in dilution to our shareholders. If we are unable to
access sufficient funds under the Equity Distribution Agreement when needed,
obtain additional external funding or generate sufficient revenue from the sale
of our products, we could be forced to curtail or possibly cease operations.

Our Independent Registered Public Accountants have added an explanatory
paragraph to their audit opinions issued in connection with our consolidated
financial statements which states that our

                                       30

<PAGE>

financial statements raise doubt as to our ability to continue as a going
concern. Assurances cannot be given that adequate financing can be obtained to
meet our capital needs. If we are unable to generate profits and unable to
continue to obtain financing to meet our working capital requirements, we may
have to curtail our business sharply or cease operations altogether. Our
continuation as a going concern is dependent upon our ability to generate
sufficient cash flow to meet our obligations on a timely basis to retain our
current financing, to obtain additional financing, and, ultimately, to attain
profitability. Should any of these events not occur, we will be adversely
affected and we may have to cease operations.

A large shortfall in projected cash flows could occur due to, but is not limited
to, any of the following reasons:

      o     a major shift in the selection of our new Annual Payment Option plan
            by new customers
      o     introduction of a competing stem cell product that would decrease
            interest in cord blood stem cell preservation
      o     a medical break-through deeming cord blood stem cell preservation
            obsolete
      o     loss of market share to new or existing competitors
      o     changes in company strategies that produce unforeseen adverse
            results
      o     decreased visibility of the stem cell industry within the national
            media
      o     poor economic factors leaving families with less disposable income

The cash flows from operations of our second subsidiary, Rain, have typically
been sufficient to cover the operating expenses incurred by Rain. However, in
the third quarter of 2005, we experienced cash flow difficulties, which we
believe were due to:

      o     the loss of our largest customer as well as another large account
            that went out of business
      o     an increase in the average cost per lead that the customer must pay
            for TV and radio which reduced or eliminated this method of
            advertising as an option for our smaller clients
      o     an increase in direct response rates which reduced or eliminated
            this method of advertising as an option for our smaller clients

Because of the above occurrences, we experienced decreased sales in the third
quarter of 2005. Therefore, short-term inter-company interest free loans were
made to Rain in order to supplement the cash flow deficiency. As of November 3,
2005, the loans totaled approximately $52,000. We believe the loans will be paid
in full by the end of 2005. We do not foresee a cash flow deficiency in the
future as sales and therefore cash receipts began to increase subsequent to the
end of the third quarter of 2005. We believe Rain will be able to fund its own
operations through cash flows from operations again in the very near future. If
Rain continues to experience cash flow difficulties, we may either restructure
administrative and selling expenses accordingly or make small short-term
inter-company loans to Rain depending on the magnitude of the shortfall.

Rain may experience insufficient cash flows due to, but not limited to, the
following reasons:

      o     a loss of current customers to competitors
      o     our inability to add new customers to our current customer base

                                       31

<PAGE>

      o     increased pricing that leaves companies with smaller advertising
            budgets unable to continue to use our services
      o     changes in company strategies that produce unforeseen adverse
            results
      o     seasonal factors within the television and radio advertising
            industry
      o     poor economic factors leaving companies with smaller advertising
            budgets unable to continue to use our services

The cash flows from operations of our third subsidiary, Family, are currently
sufficient to cover cash flow needs. We feel this will continue to be the case
for the next twelve months.

Although no assurances can be given, we believe that our cash flow deficit will
decrease as revenues and sales increase, expenses related to capital raising
decrease and we develop more profitable channels.

On September 30, 2005, we held accounts receivable (net of allowance for
doubtful accounts) of $68,506. Accounts receivable are generally kept current
through punctual collection efforts.

Our sources of funding that are currently outstanding or available are as
follows:

In August, September and October 2004, CBA issued three unsecured promissory
notes to an unrelated party. The first note for $500,000 bearing interest at 8%
per annum, the second note for $250,000 bearing interest at 10% per annum and
the third note for $250,000 bearing interest at 10% to the same party. The
second and third note each contained detachable warrants to purchase 500,000
shares (1,000,000 in total) of common stock at an exercise price of $.1875 per
share and can be exercised at any time prior to September 2009. At September 30,
2005, $250,000 in principal and $1,041 in interest was outstanding on the third
note as the first and second note were re-paid in full.

On March 22, 2005, CBA entered into an Equity Distribution Agreement with
Cornell Capital Partners. Under the Equity Distribution Agreement, the Company
may issue and sell to Cornell Capital Partners common stock for an aggregate
purchase price of up to $5,000,000. The purchase price for our shares is equal
to 98%, or a 2% discount, of the offering price, which is defined in the Equity
Distribution Agreement as the lowest volume weighted average price of the common
stock during the five trading days following the notice date. The amount of each
cash advance is subject to a maximum advance amount of $250,000, with no cash
advance occurring within seven trading days of a prior advance. Cornell Capital
Partners received 1,239,029 shares of common stock issued as a one-time
commitment fee under the Equity Distribution Agreement on March 22, 2005.
Cornell Capital Partners will be paid a fee equal to 5% of each advance.

In March 2005, Cord received a $70,000 advance on future credit card sales.
Repayment terms on this advance call for 17% of certain credit card sales until
the sum of $94,682 has been paid. At September 30, 2005, the outstanding
principal balance on the advance was $20,228.

On September 9, 2005, CBA entered into a Securities Purchase Agreement with
Cornell Capital Partners LP. Pursuant to the Securities Purchase Agreement, CBA
issued $5,000,000 in secured convertible debentures, of which $3,500,000 was
delivered on September 9, 2005 and $1,500,000

                                       32

<PAGE>

is to be delivered upon the filing of a future registration statement. The
debentures mature in 24 months and accrue interest at 12% per year. The
debentures are convertible into CBA's common stock at a pre-determined share
price of $0.35 per share. The debentures are secured by substantially all of
CBA's assets. At September 30, 2005, $3,500,000 was outstanding relating to
these debentures.

In connection with the Securities Purchase Agreement, three warrants were issued
to Cornell for the purchase of 22,570,000 shares of CBA's common stock. All
three warrants vest immediately and are exercisable over a five-year period,
expiring on September 9, 2010. The first two warrants total 14,285,000 shares of
our common stock at an exercise price of $0.35 per share. The third warrant is
for 8,285,000 shares of our common stock at an exercise price of $0.40 per
share.

If we default on any of the above agreements, we may have to curtail our
business or cease operations.

BUSINESS OUTLOOK:

We are currently engaged in many new programs at various stages that we believe
will have a positive impact on the future of CBA. We are constantly seeking new
and improved ways to produce positive financial results that are complimentary
to our business. Below is a discussion of those new programs and strategies.

CORD PARTNERS
Some of Cord's new programs and strategies that we feel will have a positive
impact are the launch of the Annual Payment Option in September 2005. One of the
greatest challenges we encounter in acquiring new customers is the objection to
the initial fee of $1,695. For many new parents, the fee can be difficult given
the numerous expenses that come along with a new baby. To address this, we
launched a new payment alternative, which allows parents to pay $269 six months
after their child is born, and an additional 17 payments of $269 annually
thereafter. This new Annual Payment Option opens the door so that family's who
may not have been able to afford it before, can afford to bank their child's
cord blood stem cells. To our knowledge, no other competitor in the private cord
blood banking industry currently offers such a plan. Numerous marketing
initiatives were launched in September and will be carried out through the
fourth quarter to promote the new payment plan and create awareness both with
existing prospects and other expectant families outside the company's database.
Included in these efforts are a new print advertising campaign, direct mail
solicitation, email solicitation, internet advertising, telesales, and baby fair
attendance. It is our intent to use this new program to sell to a new
demographic of customers who were not previously able to take advantage of our
cord blood preservation services.

Over the next twelve months, we plan to focus on executing the direct to
consumer sales strategy that has been tested, analyzed and refined during 2004
and 2005. This includes a customer focused approach to generating and closing
potential clients via print and internet advertising, direct mail solicitation,
email solicitation, and telemarketing. The addition of new salespeople to an
experienced and successful staff will enable us to better manage our existing,
potential, and new customers, while improving the overall conversion rate and
cost for acquiring clients.

                                       33

<PAGE>

We will also continue to develop new channel sales opportunities through the
addition of strategic referral partnerships with Obstetrics and Gynecology
practices and other healthcare professionals. We believe that continuing to
develop relationships with medical professionals who work closely with expectant
families will further enhance our long-term growth and profitability. Over the
next twelve months, we plan to accelerate the growth of our channel partnership
programs by engaging a firm with existing medical sales representatives on staff
to present Cord Partners' Physician Partnership Programs on a national scale to
key healthcare providers.

RAINMAKERS
Over the next six months, we plan to add long form television infomercial buys,
Hispanic media buys and call center management services. With regard to
infomercial buys, we have a partnership in place with an agency that buys
wholesale thirty minute time slots each quarter and then resells that space. We
are currently in discussions with potential infomercial clients and expect to
launch new campaigns during the first quarter of 2006.

The Hispanic population has become the largest minority group in the country and
represents a significant growth opportunity on radio and television. We have
created relationships with numerous Hispanic television and radio outlets on a
national and local level in anticipation of this growing segment of our
business, including Telemundo, Galavision and CNN Espanol.

We are also adding call center management services during the fourth quarter of
2005. We will be able to offer twenty-four hour call center services with a very
low setup fee and extremely competitive cost per minute rates to our clients.
Adding this service to our company will provide another revenue stream and give
us control over the call center process for our customers.

FAMILY MARKETING
Our strategy for Family is to take advantage of the large profit potential in
the lead generation business as more advertisers are moving to a fixed cost
advertising methodology to control their return on investment. We are putting
several campaigns in place to increase the number of leads generated for all of
our clients through our web properties over the next 12 months. We will continue
to add new advertisers to our sites and expand our network to accommodate these
advertisers. We will continue to re-market to our opt in database of leads using
both online and offline mediums to produce additional revenue.

CBA PROFESSIONAL SERVICES D/B/A BODYCELLS, INC.
We are currently exploring additional sources of adult stem cells for private
banking in an effort to diversify our service offerings within the stem cell
industry. We believe sources such as adipose tissue and peripheral blood have
the potential to make a positive financial impact on our company.

CORD BLOOD AMERICA
Finally, we continue to actively evaluate opportunities to acquire organizations
within the stem cell industry that make both strategic and financial sense.

RISK FACTORS RELATED TO OUR BUSINESS:

                                       34

<PAGE>

WE ARE SUBJECT TO VARIOUS RISKS THAT MAY MATERIALLY HARM OUR BUSINESS, FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

You should carefully consider the risks and uncertainties described below and
the other information in this filing before deciding to purchase our common
stock. If any of these risks or uncertainties actually occurs, our business,
financial condition or operating results could be materially harmed. In that
case, the trading price of our common stock could decline and you could lose all
or part of your entire investment.

                          RISKS RELATED TO OUR BUSINESS

WE HAVE BEEN THE SUBJECT OF A GOING CONCERN OPINION BY OUR INDEPENDENT AUDITORS
WHO HAVE RAISED SUBSTANTIAL DOUBT AS TO OUR ABILITY TO CONTINUE AS A GOING
CONCERN

Our Independent Registered Public Accountants have added an explanatory
paragraph to their audit opinions issued in connection with our consolidated
financial statements which states that our financial statements raise doubt as
to our ability to continue as a going concern. We have experienced net losses
from operations of $1,720,709 for the year ended December 31, 2004 and
$3,986,867 for the nine months ended September 30, 2005. In addition, for the
year ended December 31, 2004 we had a working capital deficit $1,602,940 and a
working capital deficit of $600,430 as of September 30, 2005. These factors,
among others, raise doubt about our ability to continue as a going concern. Our
consolidated financial statements do not include any adjustment that might
result from the outcome of this uncertainty. Assurances cannot be given that
adequate financing can be obtained to meet our capital needs. If we are unable
to generate profits and unable to continue to obtain financing to meet our
working capital requirements, we may have to curtail our business sharply or
cease operations altogether. Our continuation as a going concern is dependent
upon our ability to generate sufficient cash flow to meet our obligations on a
timely basis to retain our current financing, to obtain additional financing,
and, ultimately, to attain profitability. Should any of these events not occur,
we will be adversely affected and we may have to cease operations.

WE MAY NOT BE ABLE TO INCREASE SALES OR OTHERWISE SUCCESSFULLY OPERATE OUR
BUSINESS, WHICH COULD HAVE A SIGNIFICANT NEGATIVE IMPACT ON OUR FINANCIAL
CONDITION

We believe that the key to our success is to increase sales of our cord blood
preservation services as well as our advertising services and thereby increase
our revenues and available cash. Our success with regard to cord blood
preservation services will depend in large part on widespread market acceptance
of cryo-preservation of cord blood and our efforts to educate potential
customers and sell our services. Broad use and acceptance of our service
requires marketing expenditures and education and awareness of consumers and
medical practitioners. We may not have the resources required to promote our
services and their potential benefits. Successful commercialization of our
services will also require that we satisfactorily address the needs of various
medical practitioners that constitute a target market to reach consumers of our
services and to address potential resistance to recommendations for our
services. If we are unable to gain market acceptance of our services, we will
not be able to generate enough revenue to achieve and maintain profitability or
to continue our operations.

                                       35

<PAGE>

Our efforts to increase our sales and revenues of advertising and direct
response marketing services could be adversely impacted by the need for direct
to consumer advertising services and the strength of the United States economy,
especially for the small to mid-sized businesses that comprise the majority of
our client base. Since downturns in the economy have generally had a more severe
effect upon smaller companies, especially single-product companies, any changes
or anticipated changes in the economy which cause these companies to reduce
their advertising, marketing and promotion budget could negatively impact our
advertising and direct response marketing business.

Because of our dependence on a limited number of customers, our failure to
attract new clients for our advertising business could impair our ability to
continue successful operations. The absence of a significant client base may
impair our ability to attract new clients. Our failure to develop and sustain
long-term relationships with our clients would impair our ability to continue
our direct response marketing business, as a significant number of our
agreements for advertising are for short-term or single project engagements. If
our clients do not continue to use our services, and if we are unable to replace
departing clients or generate new business in a timely or effective manner our
business could be significantly and adversely affected.

We may not be able to increase our sales or effectively operate our business. To
the extent we are unable to achieve sales growth, we may continue to incur
losses. We may not be successful or make progress in the growth and operation of
our business. Our current and future expense levels are based on operating plans
and estimates of future sales and revenues and are subject to increase as
strategies are implemented. Even if our sales grow, we may be unable to adjust
spending in a timely manner to compensate for any unexpected revenue shortfall.
Accordingly, any significant shortfall in revenues would likely have an
immediate material adverse effect on our business, operating results and
financial condition. Further, if we substantially increase our operating
expenses to increase sales and marketing, and such expenses are not subsequently
followed by increased revenues, our operating performance and results would be
adversely affected and, if sustained, could have a material adverse effect on
our business. To the extent we implement cost reduction efforts to align our
costs with revenue, our sales could be adversely affected.

WE MAY BE UNABLE TO MANAGE GROWTH, WHICH MAY IMPACT OUR POTENTIAL PROFITABILITY

Successful implementation of our business strategy requires us to manage our
growth. Growth could place an increasing strain on our management and financial
resources. To manage growth effectively, we will need to:

            o     Establish definitive business strategies, goals and objectives

            o     Maintain a system of management controls

            o     Attract and retain qualified personnel, as well as, develop,
                  train and manage management-level and other employees

                                       36

<PAGE>

If we fail to manage our growth effectively, our business, financial condition
or operating results could be materially harmed, and our stock price may
decline.

WE ARE DEPENDENT UPON EXTERNAL FINANCING TO FUND OUR ONGOING OPERATIONS AND
IMPLEMENT OUR BUSINESS PLAN

Currently, we are dependent upon external financing to fund our operations. Our
financing needs have been and are expected to continue to be provided, in large
part, by funding we receive from Cornell Capital Partners. It is imperative that
we receive this external financing to implement our business plan and to finance
ongoing operations. New capital may not be available and adequate funds may not
be sufficient for our operations, and may not be available when needed or on
terms acceptable to our management. Our failure to obtain adequate additional
financing may require us to delay, curtail or scale back some or all of our
operations and may hinder our ability to expand or continue our business. Any
additional financing may involve dilution to our then-existing shareholders,
which could result in a decrease in the price of our shares.

WE ARE DEPENDENT UPON A THIRD PARTY FACILITY FOR THE STORAGE OF UMBILICAL CORD
BLOOD; IF OUR STORAGE ARRANGEMENTS TERMINATE OR THE FACILITY FAILS FOR ANY
REASON, WE MAY NOT BE ABLE TO PROVIDE CORD BLOOD BANKING SERVICES FOR SOME
PERIOD OF TIME

We do not own or operate a storage facility for umbilical cord blood. All cord
blood collected from our customers is stored at Bergen Community Regional Blood
Center in Paramus, New Jersey. If our storage arrangements with the facility
terminate for any reason, we may not be able to continue to provide our cord
blood banking services for some period of time. Even if we are able to negotiate
an extension of our existing agreement or enter into one or more new agreements,
we may not be able to obtain favorable terms.

To the extent our cryo-preservation storage service is disrupted, discontinued
or the performance is impaired, our business and operations would be adversely
affected. Any failure, including network, software, hardware or equipment
failure, that causes a material interruption or discontinuance in our
cryo-preservation storage of stem cell specimens could result in stored
specimens being damaged and/or rendered unusable. Specimen damage, including
loss in transit to the Bergen Community Regional Blood Center facility, could
result in litigation against us and reduced future revenue, which in turn could
be harmful to our reputation. While our agreement with Bergen Community Regional
Blood Center requires both parties to maintain commercial general liability
insurance in amounts of not less than $1,000,000 per incident and $3,000,000
annual aggregate amount, such insurance coverage may not adequately compensate
us for any losses that may occur due to any system failures or interruptions in
the ability to maintain proper, continued, cryo-preservation storage services.
Any material disruption in the ability to maintain continued, uninterrupted
storage systems could have a material adverse effect on our business, operating
results and financial condition. Our systems and operations are vulnerable to
damage or interruption from fire, flood, break-ins, tornadoes and similar events
for which we may not carry sufficient business interruption insurance to
compensate us for losses that may occur.

WE ARE DEPENDENT UPON A PATENT LICENSE AGREEMENT FOR CERTAIN TECHNOLOGY AND
PROCESSES UTILIZED TO COLLECT, PROCESS AND STORE UMBILICAL CORD BLOOD; IF OUR
LICENSING

                                       37

<PAGE>

ARRANGEMENT TERMINATES FOR ANY REASON, WE MAY NOT BE ABLE TO COLLECT, PROCESS OR
STORE UMBILICAL CORD BLOOD FOR SOME PERIOD OF TIME

Pursuant to the Patent License Agreement, Cord Partners may, on a non-exclusive
basis, collect, process and store cord blood utilizing PharmaStem technology and
processes covered by its patents for so long as the patents remain in effect. If
our licensing arrangement with PharmaStem terminates for any reason, then we may
not be able to provide our cord blood banking services for some period of time,
if at all. Even if we are able to negotiate a new agreement with PharmaStem, we
may not be able to obtain favorable terms.

IF WE DO NOT OBTAIN AND MAINTAIN NECESSARY DOMESTIC REGULATORY REGISTRATIONS,
APPROVALS AND COMPLY WITH ONGOING REGULATIONS, WE MAY NOT BE ABLE TO MARKET OUR
CORD BLOOD BANKING SERVICES

The cord blood banking services that we provide are currently subject to FDA
regulations requiring infectious disease testing. The cord blood facility we use
has registered with the FDA as a cord blood banking service, listed its products
with the FDA, and will be subject to FDA inspection. In addition, the FDA has
proposed new good tissue practice regulations that would establish a
comprehensive regulatory program for human cellular and tissue-based products as
well as proposed rules for donor suitability. Consistent with industry practice,
our cord blood collection kits have not been cleared as a medical device. The
FDA has announced that it will implement more regulatory procedures for cord
blood banking in January 2006. This new regulation may require medical device
pre-market notification clearance or approval for the collection kits. Securing
any necessary medical device clearance or approval for the cord blood collection
kits may involve the submission of a substantial volume of data and may require
a lengthy substantive review. This would increase costs and could reduce
profitability. The FDA could also require that we cease using the collection kit
and require medical device pre-market notification clearance or approval prior
to further use of the kits. This could cause us to cease operations for some
period of time.

We may not be able to comply with any future regulatory requirements, including
product standards that may be developed after the date hereof. Moreover, the
cost of compliance with government regulations may adversely affect revenue and
profitability. Failure to comply with applicable regulatory requirements can
result in, among other things, injunctions, operating restrictions, and civil
fines and criminal prosecution. Delays or failure to obtain registrations could
have a material adverse effect on the marketing and sales of services and impair
the ability to operate profitably in the future.

Of the states in which we provide cord blood banking services, only New Jersey
and New York currently require that cord blood banks be licensed. We maintain
the required procurement service licenses of both the states of New York and New
Jersey. If other states adopt requirements for the licensing of cord blood
banking services, either the cord blood storage facility, or we may have to
obtain licenses to continue providing services in those states.

BECAUSE OUR INDUSTRY IS SUBJECT TO RAPID TECHNOLOGICAL AND THERAPEUTIC CHANGES
AND NEW DEVELOPMENTS, OUR FUTURE SUCCESS WILL DEPEND ON THE CONTINUED VIABILITY
OF THE USE OF STEM CELLS AND OUR ABILITY TO RESPOND TO THE CHANGES

                                       38

<PAGE>

The use of stem cells in the treatment of disease is a relatively new technology
and is subject to potentially revolutionary technological, medical and
therapeutic changes. Future technological and medical developments could render
the use of stem cells obsolete. In addition, there may be significant advances
in other treatment methods, such as genetics, or in disease prevention
techniques, which could significantly reduce the need for the services we
provide. Therefore, changes in technology could affect the market for our
services and necessitate changes to those services. We believe that our future
success will depend largely on our ability to anticipate or adapt to such
changes, to offer on a timely basis, services that meet these evolving standards
and demand of our customers. Expectant parents may not use our services and our
services may not provide competitive advantages with current or future
technologies. Failure to achieve increased market acceptance could have a
material adverse effect on our business, financial condition and results of
operations.

OUR MARKETS ARE INCREASINGLY COMPETITIVE AND, IN THE EVENT WE ARE UNABLE TO
COMPETE AGAINST LARGER COMPETITORS, OUR BUSINESS COULD BE ADVERSELY AFFECTED

Cord blood banking and stem cell preservation is becoming an increasingly
competitive business. Our business faces competition from other operators of
cord blood and stem cell preservation businesses and providers of cord blood and
stem cell storage services. Competitors with greater access to financial
resources may enter our markets and compete with us. Many of our competitors
have longer operating histories, larger customer bases, longer relationships
with clients, and significantly greater financial, technical, marketing, and
public relations resources than we do. Established competitors who have
substantially greater financial resources and longer operating histories than
us, are able to engage in more substantial advertising and promotion and attract
a greater number of customers and business than we currently attract. While this
competition is already intense, if it increases, it could have an even greater
adverse impact on our revenues and profitability. In the event that we are not
able to compete successfully, our business will be adversely affected and
competition may make it more difficult for us to grow our revenue and maintain
our existing business.

The advertising and direct marketing service industry is highly competitive. We
compete with major national and international advertising and marketing
companies and with major providers of creative or media services. The client's
perception of the quality of our creative product, our reputation and our
ability to serve clients are, to a large extent, factors in determining our
ability to generate and maintain advertising business. Our size and our lack of
significant revenue may affect the way that potential clients view us.

OUR INFORMATION SYSTEMS ARE CRITICAL TO OUR BUSINESS AND A FAILURE OF THOSE
SYSTEMS COULD MATERIALLY HARM US

We depend on our ability to store, retrieve, process and manage a significant
amount of information. If our information systems fail to perform as expected,
or if we suffer an interruption, malfunction or loss of information processing
capabilities, it could have a material adverse effect on our business.

                                       39

<PAGE>

WE COULD FAIL TO ATTRACT OR RETAIN KEY PERSONNEL, WHICH COULD BE DETRIMENTAL TO
OUR OPERATIONS

Our success largely depends on the efforts and abilities of our Chief Executive
Officer, Matthew L. Schissler. The loss of his services could materially harm
our business because of the cost and time necessary to find his successor. Such
a loss would also divert management's attention away from operational issues. We
do not presently maintain key-man life insurance policies on our Chief Executive
Officer. We also have other key employees who manage our operations and if we
were to lose their services, senior management would be required to expend time
and energy to find and train their replacements. To the extent that we are
smaller than our competitors and have fewer resources, we may not be able to
attract the sufficient number and quality of staff.

                           RISKS RELATED TO OUR STOCK

OUR COMMON STOCK IS AFFECTED BY LIMITED TRADING VOLUME AND MAY FLUCTUATE
SIGNIFICANTLY

There has been a limited public market for our common stock and there can be no
assurance that a more active trading market for our common stock will develop.
Our common stock has experienced, and is likely to experience in the future,
significant price and volume fluctuations, which could adversely affect the
market price without regard to operating performance. In addition, we believe
that factors such as quarterly fluctuations in financial results and changes in
the overall economy or the condition of the financial markets could cause the
price of our common stock to fluctuate substantially. These fluctuations may
also cause short sellers to enter the market from time to time in the belief
that we will have poor results in the future. We cannot predict the actions of
market participants and, therefore, can offer no assurances that the market for
our stock will be stable or appreciate over time. These factors may negatively
impact our shareholders' ability to sell shares of our common stock.

OUR COMMON STOCK IS DEEMED TO BE "PENNY STOCK," WHICH MAY MAKE IT MORE DIFFICULT
FOR INVESTORS TO SELL THEIR SHARES DUE TO SUITABILITY REQUIREMENTS

Our common stock is deemed to be "PENNY STOCK" as that term is defined in Rule
3a51-1 promulgated under the Securities Exchange Act of 1934. These requirements
may reduce the potential market for our common stock by reducing the number of
potential investors. This may make it more difficult for investors in our common
stock to sell shares to third parties or to otherwise dispose of them. This
could cause the stock price to decline. Penny stocks are stock:

      o     With a price less than $5.00 per share;

      o     That are not traded on a "recognized" national exchange;

      o     Whose prices are not quoted on the NASDAQ automated quotation
            system; or

      o     Of issuers with net tangible assets less than $2.0 million (if the
            issuer has been in continuous operation for at least three years) or
            $10.0 million (if in continuous operation for

                                       40

<PAGE>

            less than three years), or with average revenues of less than $6.0
            million for the last three years.

Broker/dealers dealing in penny stocks are required to provide potential
investors with a document disclosing the risks of penny stocks. Moreover,
broker/dealers are required to determine whether an investment in a penny stock
is a suitable investment for a prospective investor.

THE OWNERSHIP OF OUR COMMON STOCK IS CONCENTRATED IN THE HANDS OF OUR EXISTING
DIRECTORS AND EXECUTIVE OFFICERS; AS A RESULT, YOU MAY NOT BE ABLE TO EXERT
MEANINGFUL INFLUENCE ON SIGNIFICANT CORPORATE DECISIONS

Our directors and executive officers beneficially own, in the aggregate,
approximately 52% of our outstanding shares of common stock as of October 26,
2005. These persons, acting together, will be able to exercise significant
influence over all matters requiring stockholder approval, including the
election and removal of directors and any merger, consolidation or sale of all
or substantially all of our assets. This concentration of ownership may harm the
market price of our common stock by delaying or preventing a change in control
of the company at a premium price even if beneficial to other stockholders.

WE ARE SUBJECT TO PRICE VOLATILITY DUE TO OUR OPERATIONS MATERIALLY FLUCTUATING;
AS A RESULT, ANY QUARTER-TO-QUARTER COMPARISONS IN OUR FINANCIAL STATEMENTS MAY
NOT BE MEANINGFUL

We believe that our operating results may fluctuate materially, as a result of
which quarter-to-quarter comparisons of our results of operations may not be
meaningful. If in some future quarter, whether as a result of such a fluctuation
or otherwise, our results of operations fall below the expectations of
securities analysts and investors, the trading price of our common stock would
likely be materially and adversely affected. You should not rely on our results
of any interim period as an indication of our future performance. Additionally,
our quarterly results of operations may fluctuate significantly in the future as
a result of a variety of factors, many of which are outside our control. Factors
that may cause our quarterly results to fluctuate include, among others:

            o     our ability to retain existing clients and customers;
            o     our ability to attract new clients and customers at a steady
                  rate;
            o     our ability to maintain client satisfaction;
            o     the extent to which our products gain market acceptance;
            o     the timing and size of client and customer purchases;
            o     introductions of products and services by competitors;
            o     price competition in the markets in which we compete;
            o     our ability to attract, train, and retain skilled management;
            o     the amount and timing of operating costs and capital
                  expenditures relating to the expansion of our business,
                  operations, and infrastructure;
            o     a reduction in sales due to seasonal factors; and
            o     general economic conditions as well as economic conditions
                  specific to media distribution.

                                       41

<PAGE>

SALES OF SUBSTANTIAL AMOUNTS OF OUR COMMON STOCK, OR THE AVAILABILITY OF THOSE
SHARES FOR FUTURE SALE, COULD ADVERSELY AFFECT OUR STOCK PRICE AND LIMIT OUR
ABILITY TO RAISE CAPITAL

We are unable to predict the effect, if any, that future sales of our common
stock or the potential for such sales may have on the market price of our common
stock. Of the 39,733,765 shares of common stock outstanding as of October 26,
2005, 13,704,157 shares are, or will be, freely tradable without restriction,
unless held by our "affiliates". The remaining 26,029,608 of common stock, which
are held by existing stockholders, including our officers and directors, are
"restricted securities" and may be resold in the public market only if
registered or pursuant to an exemption from registration. Some of these shares
may be resold under Rule 144.

VARIOUS ANTI-TAKEOVER PROVISIONS ARE CONTAINED IN OUR AMENDED AND RESTATED
ARTICLES OF INCORPORATION AND OUR AMENDED AND RESTATED BYLAWS; AS A RESULT, ANY
TAKEOVER OF CORD BLOOD MAY BE DELAYED OR DISCOURAGED

Our Amended and Restated Articles of Incorporation provide for a staggered Board
of Directors. Mr. Vicente's term expires in 2005, Mr. Weir's term expires in
2006 and Mr. Schissler's term expires in 2008. Our Amended and Restated Articles
of Incorporation, as amended, also provide for a substantial number of shares of
common stock and "blank check" preferred stock authorized for issuance solely by
action of the Board of Directors. Our Amended and Restated Bylaws provide, among
other things, that nominations for election to our Board of Directors, other
than those made by the Board of Directors, must be made by written notification
delivered to the Company not less than 20 and not more than 50 days prior to any
annual or special meeting of shareholders called for the election of directors.
These provisions may have the effect of delaying or discouraging any takeover of
the Company by others or otherwise delaying or limiting our shareholders'
ability to change the our direction and management.

AS ADVANCES ARE REQUESTED UNDER THE EQUITY DISTRIBUTION AGREEMENT, CORNELL
CAPITAL PARTNERS WILL PAY LESS THAN THE THEN-PREVAILING MARKET PRICE AND WILL
HAVE AN INCENTIVE TO SELL ITS SHARES, WHICH MAY CAUSE THE PRICE OF OUR COMMON
STOCK TO DECLINE

Cornell Capital Partners will purchase shares of our common stock pursuant to
the Equity Distribution Agreement at a purchase price that is less than the
then-prevailing market price of our common stock as advances are requested.
Cornell Capital Partners will have an incentive to immediately sell any shares
of our common stock that it purchases pursuant to the Equity Distribution
Agreement to realize a gain on the difference between the purchase price and the
then-prevailing market price of our common stock. To the extent Cornell Capital
Partners sells its common stock, our common stock price may decrease due to the
additional shares in the market. This could allow Cornell Capital Partners to
sell greater amounts of common stock, the sales of which would further depress
the stock price.

Cornell Capital Partners may be deemed to beneficially own the shares of common
stock to be issued to Cornell Capital Partners corresponding to a particular
advance notice even before such shares of common stock have been delivered and
may sell those shares before they have been delivered. Such sales may cause our
stock price to decline.

                                       42

<PAGE>

WE MAY NOT BE ABLE TO RECEIVE APPROVAL FROM THE SECURITIES AND EXCHANGE
COMMISSION OF OUR REGISTRATION STATEMENT TO BE FILED PURSUANT TO OUR SECURITIES
PURCHASE AGREEMENT

We are dependent upon approval from the SEC of our registration statement to be
filed pursuant to our Securities Purchase Agreement with Cornell Capital
Partners in order to have enough shares available to fulfill the current
agreement. If our registration statement is not approved, Cornell will be unable
to exercise the conversion feature of the convertible debentures issued as part
of the agreement as well as the associated warrants. If that occurred,
restructuring of the agreement would likely occur with the possibility of having
to re-pay the funding with cash, which we would not be able to do without
securing additional outside funding.

OFF-BALANCE SHEET ARRANGEMENTS:

We do not have any off-balance sheet arrangements that have or are reasonably
likely to have a current or future effect on our financial condition, changes in
financial condition, revenues or expenses, results of operations, liquidity,
capital expenditures or capital resources that is material to investors.

ITEM  3. CONTROLS AND PROCEDURES
         -----------------------

As of September 30, 2005, an evaluation was carried out under the supervision of
and with the participation of CBA's management, including CBA's Chief Executive
Officer (Principal Executive Officer), and Chief Financial Officer (Principal
Financial and Accounting Officer), of the effectiveness of our disclosure
controls and procedures. Based on that evaluation, the Company's Chief Executive
Officer and Chief Financial Officer concluded that the Company's disclosure
controls and procedures are effective, as of September 30, 2005, to ensure that
information required to be disclosed by the Company in reports that it files or
submits under the Securities Exchange Act of 1934 is recorded, processed,
summarized and reported within the time periods specified in Securities and
Exchange Commission rules and forms.

There have been no changes in our internal control over financial reporting
during the three months ended September 30, 2005 that have materially affected
or are reasonably likely to materially affest our internal control over
financial reporting.

It should be noted that the design of any system of controls is based in part
upon certain assumptions about the likelihood of future events, and there can be
no assurance that any design will succeed in achieving its stated goals under
all potential future conditions, regardless of how remote.

PART  II. - OTHER INFORMATION

ITEM  1. LEGAL PROCEEDINGS
         -----------------

In June 2005, we received a complaint filed in the United States District Court
of the Western District of Washington by Merrill Corporation, a Minnesota
corporation, naming Cord Blood

                                       43

<PAGE>

America and Cord Partners (collectively "CBACP") as defendants. The complaint
alleges that CBACP owes Merrill Corporation, the Plaintiff, $101,738 for work
performed and products provided plus attorneys' fees, costs, applicable service
charges and penalties. The complaint seeks judgment in the principal amount,
plus applicable service charges and penalties; an award of post-judgment
interest on all amounts; attorney's fees and costs and for such other and
further relief as the Court deems just and equitable.

In September, CBACP submitted a settlement proposal to the Plaintiff and
received a counter proposal. On October 21, 2005, CBACP offered to fully and
finally settle the matter in the amount of $70,000 payable in four monthly
installments of $15,000 and a final payment of $10,000. The Plaintiff has yet to
respond.

CBACP has accrued $61,450 in relation to this litigation based on the invoices
it has received to date.

ITEM  2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
         -----------------------------------------------------------

We have issued the following securities in 2005 without registering them under
the Securities Act of 1933:

On January 10, 2005, we issued options to purchase 501,000 shares of our common
stock to our employees and a director as part of their compensation for services
provided to CBA. The options vest at a rate of 25% per year and have an exercise
price of $0.25.

In July 2005 160,000 options at $0.25 were issued to Gecko Media for carrying
past due balances due per the Web Development Agreement. The remaining past due
balance was paid in October 2005. The options are 100% vested on the six-month
anniversary of the grant date.

On July 1, 2005, CBA issued options to purchase 138,888 shares of common stock
to Gecko Media, Inc. as compensation for carrying balances of past due invoices.
The options are 100% vested on the first anniversary of the grant date and have
an exercise price of $0.18.

On July 1, 2005, CBA issued options to purchase 19,722 shares of common stock to
Family Marketing, LLC for previously carrying past due amounts owed by the
Company. The options are 100% vested on the first anniversary of the grant date
and have an exercise price of $0.18.

On July 1, 2005, CBA issued options to purchase 250,000 shares of common stock
to the CFO as compensation for services. The options vest in one year and have
an exercise price of $0.25.

On July 1, 2005, CBA issued options to purchase 250,000 shares of common stock
to the CTO as compensation for services. The options vest in one year and have
an exercise price of $0.25.

In July 2005, CBA issued options to purchase 400 shares of our common stock to
an employee as part of their compensation for services provided to the Company.
The options are 100% vested on the first anniversary of the grant date and have
an exercise price of $0.25.

                                       44

<PAGE>

On July 5, 2005, CBA issued options to purchase 98,331 shares of our common
stock to officers of the company for short term loans made to the Company. The
options are 100% vested on the first anniversary of the grant date and have an
exercise price of $0.18.

During the three months ended September 30, 2005, CBA issued a total of
3,568,734 shares to repay $1,360,553 in outstanding debt and interest to Cornell
Capital Partners LP.

In August 2005, 184,848 options at $0.33 were issued to an officer for loaning
money to the company. The loan was repaid within the same month. The vesting
period of the options is 1 year.

In August 2005, the Company entered into a stock option agreement in exchange
for business consulting services in relation to the Annual Payment Option. The
agreement calls for the issuance of 5,000 options which vest over a one year
period at an exercise price of $0.33 per share. In connection with these options
issued, CBA recognized an expense of approximately $2,000.

In August 2005, 200,000 options at $0.25 were issued to a director for a loan to
the company that occurred in January 2005. The loan was repaid in March 2005.
The vesting period of the options is one year.

In August 2005, as recognition of their service, two of CBA's directors were
each granted options to purchase 50,000 shares of our common stock at an
exercise price of $0.25 per share. The vesting period of the options is one
year.

In August 2005, CBA's new director was granted options to purchase 100,000
shares of our common stock at an exercise price of $0.25 per share. The vesting
period of the options is one year.

In September 2005, 1,600,000 options at $0.31 were issued to an officer in
exchange for that officer placing 7,770,000 personal shares in escrow to be used
as collateral for the Securities Purchase Agreement. The vesting period of the
options is one year.

On September 1, 2005, 60,000 shares were issued to a consultant for $12,500 in
investor relations services performed from May 2005 through September 2005.

On September 7, 2005, 34,000,000 shares of common stock were issued to Cord
Blood America to serve as collateral to the Agreement entered into with Cornell.
These shares are held as treasury shares.

On September 30, 2005. 12,000 options at $0.51 and 50,000 options at $0.45 were
awarded to employees of the company. The vesting period of the options is one
year.

Unless otherwise noted in this section, with respect to the sale of unregistered
securities referenced above, all transactions were exempt from registration
pursuant to Section 4(2) of the Securities Act of 1933, as amended (the "1933
Act"), and Regulation D promulgated under the 1933 Act. In each instance, the
purchaser had access to sufficient information regarding CBA so as to make an
informed investment decision. More specifically, we had a reasonable basis to
believe that each

                                       45

<PAGE>

purchaser was an "accredited investor" as defined in Regulation D of the 1933
Act and otherwise had the requisite sophistication to make an investment in
CBA's securities.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES
        -------------------------------

NONE

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITIES HOLDERS
        -----------------------------------------------------
NONE

ITEM 5. OTHER INFORMATION
        -----------------
NONE

ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
        --------------------------------

      (a)   Exhibits
            --------

      The following exhibits are filed as part of this Form 10-QSB.

EXHIBIT NO.     DESCRIPTION                       LOCATION
-----------     -------------------------------   ------------------------------

3.0             Amended and Restated Articles     Filed as an exhibit to
                of Incorporation of Cord Blood    Registration Statement on Form
                America, Inc.                     10-SB filed on May 6, 2004

3.1             Amended and Restated Bylaws of    Filed as an exhibit to
                Cord Blood America, Inc.          Registration Statement on Form
                                                  10-SB filed on May 6, 2004

4.0             Form of Common Stock Share        Filed as an exhibit to
                Certificate of Cord Blood         Registration Statement on Form
                America, Inc.                     10-SB filed on May 6, 2004

10.28           Amendment Agreement to a          Filed as an exhibit to Current
                Promissory Note with Cornell      Report on Form 8-K filed on
                Capital Partners                  July 7, 2005

10.31           Employment Agreement with Chief   Filed as an exhibit to Current
                Financial Officer                 Report on Form 8-K filed on
                                                  July 13, 2005

                                       46

<PAGE>

EXHIBIT NO.     DESCRIPTION                       LOCATION
-----------     -------------------------------   ------------------------------

10.32           Employment Agreement with Chief   Filed as an exhibit to Current
                Technology Officer                Report on Form 8-K filed on
                                                  July 13, 2005

10.33           Stock Option Agreement with       Filed as an exhibit to Current
                Chief Financial Officer           Report on Form 8-K filed on
                                                  July 13, 2005

10.34           Stock Option Agreement with       Filed as an exhibit to Current
                Chief Technology Officer          Report on Form 8-K filed on
                                                  July 13, 2005

10.35           Promissory Note to Cornell        Filed as an exhibit to Current
                Capital Partners for $500,000     Report on Form 8-K filed on
                                                  July 21, 2005

10.37           Warrant to Purchase Common        Filed as an exhibit to Current
                Stock to Cornell Capital          Report on Form 8-K filed on
                Partners                          September 12, 2005

10.38           Security Agreement between        Filed as an exhibit to Current
                Family Marketing Inc. and         Report on Form 8-K filed on
                Cornell Capital Partners          September 12, 2005

10.39           Security Agreement between        Filed as an exhibit to Current
                Career Channel Inc. and Cornell   Report on Form 8-K filed on
                Capital Partners                  September 12, 2005

10.40           Security Agreement between CBA    Filed as an exhibit to Current
                Professional Services Inc. and    Report on Form 8-K filed on
                Cornell Capital Partners          September 12, 2005

10.41           Security Agreement between CBA    Filed as an exhibit to Current
                Properties Inc. and Cornell       Report on Form 8-K filed on
                Capital Partners                  September 12, 2005

10.42           Security Agreement between Cord   Filed as an exhibit to Current
                Blood America Inc. and Cornell    Report on Form 8-K filed on
                Capital Partners                  September 12, 2005

10.43           Security Agreement between Cord   Filed as an exhibit to Current
                Partners Inc. and Cornell         Report on Form 8-K filed on
                Capital Partners                  September 12, 2005

10.44           Pledge and Escrow Agreement by    Filed as an exhibit to Current
                Cord Blood America, Inc,          Report on Form 8-K filed on
                Cornell Capital Partners, and     September 12, 2005
                David Gonzalez, Esq.

                                       47

<PAGE>

EXHIBIT NO.     DESCRIPTION                       LOCATION
-----------     -------------------------------   ------------------------------

10.45           Insider Pledge and Escrow         Filed as an exhibit to Current
                Agreement by Cornell Capital      Report on Form 8-K filed on
                Partners, Cord Blood America,     September 12, 2005
                Inc., Matthew L. Schissler, and
                David Gonzalez, Esq.

10.46           Investor Registration Rights      Filed as an exhibit to Current
                Agreement between Cord Blood      Report on Form 8-K filed on
                America, Inc. and Cornell         September 12, 2005
                Capital Partners.

10.47           Securities Purchase Agreement     Filed as an exhibit to Current
                between Cord Blood America,       Report on Form 8-K filed on
                Inc. and Cornell Capital          September 12, 2005
                Partners.

10.48           Warrant to Purchase Common        Filed as an exhibit to Current
                Stock by Cornell Capital          Report on Form 8-K filed on
                Partners                          September 12, 2005

10.50           Warrant to Purchase Common        Filed as an exhibit to Current
                Stock by Cornell Capital          Report on Form 8-K filed on
                Partners                          September 12, 2005

10.51           Secured Convertible Debenture     Filed as an exhibit to Current
                issued by Cord Blood America to   Report on Form 8-K filed on
                Cornell Capital Partners          September 12, 2005

31.0            Certification of Cord Blood       Provided herewith
                America, Inc. Chief Executive
                Officer, Matthew L. Schissler,
                pursuant to Section 302 of the
                Sarbanes-Oxley Act of 2002

31.1            Certification of Cord Blood       Provided herewith
                America, Inc. Principal
                Financial Officer, Sandra D.
                Smith, pursuant to Section 302
                of the Sarbanes-Oxley Act of
                2002

32.0            Certification of Cord Blood       Provided herewith
                America, Inc. Chief Executive
                Officer, Matthew L. Schissler,
                pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002

32.1            Certification of Cord Blood       Provided herewith
                America, Inc. Chief Financial
                Officer, Sandra D. Smith,
                pursuant to Section 906 of the
                Sarbanes-Oxley Act of 2002

                                       48

<PAGE>

                                   SIGNATURES

      In accordance with Section 13 or 15(d) of the Securities Exchange Act of
1934, the registrant has caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.

                                         CORD BLOOD AMERICA, INC.

Date: November 21, 2005                  By: /s/ Matthew L. Schissler
                                             ------------------------
                                         Matthew L. Schissler,
                                         Chairman and Chief Executive Officer
                                         (Principal Executive Officer)

                                         By: /s/ Sandra D. Smith
                                             -------------------
                                         Sandra D. Smith,
                                         Chief Financial Officer
                                         (Principal Financial and Accounting
                                         Officer)

                                       49