UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON D. C. 20549
                                   FORM 10-KSB

(Mark One)

[X] Annual report under Section 13 or 15(d) of the Securities and Exchange Act
of 1934 for the fiscal year ended December 31, 2004.

[ ] Transition report under Section 13 or 15(d) of the Securities Exchange Act
of 1934 for the transition period from _____ ____________ to ____________ .

Commission File Number:  000-50746


                            Cord Blood America, Inc.
                            ------------------------
                 (Name of small business issuer in its 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)

          Securities Registered under Section 12(b) of the Exchange Act
          -------------------------------------------------------------
                                      None

          Securities registered under Section 12(g) of the Exchange Act
          -------------------------------------------------------------
                    Common Stock, par value $.0001 per share

Check whether the registrant: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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 [ ]

Check if there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of the registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-KSB
or any amendment to this Form 10-KSB. [ ]

State issuer's revenues for its most recent fiscal year: $751,850

The aggregate market value of the registrant's common stock held by
non-affiliates on March 24, 2005 (based on the closing price of the OTC Bulletin
Board) on such date was approximately $4,976,002.

State the number of shares outstanding of each of the issuer's classes of common
equity, as of March 24, 2005: 29,270,600 shares of common stock, par value
$.0001 per share

                       DOCUMENTS INCORPORATED BY REFERENCE

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

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                        2004 ANNUAL REPORT ON FORM 10-KSB

                                TABLE OF CONTENTS

PART I.

Item 1.  Description of Business

Item 2.  Description of Property

Item 3.  Legal Proceedings

Item 4.  Submission of Matters to a Vote of Security Holders


PART II.

Item 5.  Market for Common Equity and Related Stockholder Matters

Item 6.  Management's Discussion and Analysis

Item 7.  Financial Statements

Item 8.  Changes In and Disagreements With Accountants on Accounting and
         Financial Disclosure

Item 8A. Controls and Procedures

PART III.

Item 9.  Directors, Executive Officers, Promoters and Control Persons;
         Compliance With Section 16(a) of the Exchange Act

Item 10. Executive Compensation

Item 11. Security Ownership of Certain Beneficial Owners and Management and
         Related Stockholder Matters

Item 12. Certain Relationships and Related Transactions

Item 13. Exhibits and Reports on Form 8-K

Item 14. Principal Accountant Fees and Services

Signatures
Certifications

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<PAGE>


DISCLOSURE REGARDING FORWARD-LOOKING STATEMENTS

         In addition to the historical information contained herein, we make
statements in this Quarterly Report on Form 10-KSB that are forward-looking
statements. Sometimes these statements will contain words such as "believes,"
"expects," "intends," "should," "will," "plans," and other similar words. 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. We do not assume the obligation to
update or revise any forward-looking statements.

         The acquisition of the Company's first subsidiary corporation, Cord
Partners, Inc., occurred on March 31, 2004. Active operations of Cord Partners,
Inc., commenced in January 2003. On November 12, 2004, the Company formed its
second subsidiary corporation, CBA Professional Services, Inc., as well as its
third subsidiary, CBA Properties, Inc.. On February 28, 2005, the Company
acquired its fourth subsidiary corporation, Career Channel, Inc. d/b/a
Rainmakers International. Rainmakers International commenced operations in March
of 2001. Therefore, the Company only has a limited operating history.

PART I

ITEM 1.  DESCRIPTION OF BUSINESS
         -----------------------

BUSINESS DEVELOPMENT
--------------------

         Cord Blood America, Inc., is a Florida corporation, which was formed in
1999. It did not commence business operations until it acquired Cord Partners,
Inc., a Florida corporation ("CPI"), as of March 31, 2004. Since CPI's formation
in January 2003, CPI has been, and continues to be, engaged in the business of
collecting, testing, processing and preserving umbilical cord blood, thereby
allowing families to preserve cord blood at the birth of a child for potential
use in future stem cell therapy.

         Shortly before the acquisition of CPI, Cord Blood America, Inc. changed
its name from D & A Lending, Inc. to Cord Blood America, Inc. ("CBA"). CBA
acquired all of CPI's issued and outstanding shares of common stock, making CPI
a wholly-owned subsidiary of CBA.

         In April 2004, we declared and paid to all of the shareholders of CBA a
two for one stock split effected as a stock dividend.

         On November 12, 2004, CBA Professional Services, Inc., a Florida
corporation ("CBAPS") was formed. The company has authorized 10,000 shares of
non-par restricted common stock. In November 2004, CBAPS issued 100 shares of
its common stock to Cord Blood America, Inc. and became a wholly-owned
subsidiary of CBA. As of December 31, 2004, 100 shares of common stock were
issued and outstanding.

                                       3
<PAGE>

         CBA Properties, Inc. ("CBAPI") was formed on November 17, 2004 as a
Florida corporation. In November 2004, CBAPI issued 100 shares of its common
stock to Cord Blood America, Inc. and became a wholly-owned subsidiary of CBA.

         When used herein the term "Company" refers to the combined business
entity of CBA, CPI, CBAPS and CBAPI unless the context otherwise indicates.

BUSINESS OF ISSUER
------------------

INDUSTRY BACKGROUND

         STEM CELLS. The human body is comprised of many types of cells with
individual characteristics and specific functions. Cells with a defined or
specialized function are referred to as differentiated. Examples of
differentiated cells include nerve cells, red blood cells and skin cells.
Differentiated cells are replaced and renewed over time from a population of
rare, undifferentiated cells known as stem cells. As stem cells grow and
proliferate, they are capable of producing both additional stem cells as well as
cells that have differentiated to perform a specific function. Stem cell
differentiation is prompted by specific cell-to-cell interactions or other
molecular signals. These signals trigger a change in the cell's genetic profile,
causing specific genes to become active and others to become inactive. As a
result, the cell develops specialized structures, features and functions
representative of its differentiated cell type.

         There are many types of stem cells in the human body. These stem cells
are found in different concentrations and in different locations in the body
during a person's lifetime. Current thinking suggests that each organ and tissue
in the body is founded, maintained and possibly rejuvenated to different
degrees, on a more or less continual basis, by specific stem cell populations
naturally present in the body. Types of stem cells include:

         Hematopoietic stem cells. Hematopoietic, or blood, stem cells reside in
the bone marrow. They can also be found in an infant's umbilical cord as well as
circulating in very small numbers in the blood. Hematopoietic stem cells
generate all other blood and immune system cells in the body.

         Neural stem cells. Neural stem cells can be found in the brain and
spinal cord and are capable of differentiating into nerve and brain tissue.

         Mesenchymal stem cells. Mesenchymal stem cells can be found in bone
marrow and differentiate into bone, cartilage, fat, muscle, tendon and other
connective tissues.

         Pancreatic islet stem cells. Pancreatic islet stem cells can be found
in the pancreas and differentiate into specialized cells of the pancreas
including cells that secrete insulin.

         The ability of a stem cell to differentiate into multiple types of
cells of a certain tissue is referred to as pluripotency. For example, a
hematopoietic stem cell has the ability to differentiate into many types of
blood and immune system cells. However, stem cells of one tissue type may also
generate specialized cells of another tissue type, a characteristic referred to

                                       4
<PAGE>

as plasticity. For example, under specific conditions, hematopoietic stem cells
have been shown to generate specialized cells of other systems, including
neural, endocrine, skeletal, respiratory and cardiac systems. These
characteristics make stem cells highly flexible and very useful for a number of
applications, including the potential use as therapeutics.

         CELL THERAPY. Cell therapy is the use of live cells as therapeutic
agents to treat disease. This therapy involves the introduction of cells to
replace or initiate the production of other cells that are missing or damaged
due to disease. Currently, the most common forms of cell therapy include blood
and platelet transfusions and bone marrow transplants.

         Bone marrow transplantation is a medical procedure in which
hematopoietic stem cells are introduced into the body in order to regenerate
healthy, functioning bone marrow. In this procedure, stem cells are obtained
from a donor through a surgical procedure to remove approximately one liter of
bone marrow. The donated bone marrow, including any "captured" stem cells, is
then transfused into the patient. Stem cells for transplantation may also be
obtained from peripheral blood or umbilical cord blood donations. Sometimes the
stem cells used in the procedure are obtained from the patient's own bone marrow
or blood.

         Bone marrow transplantation has been successfully employed in the
treatment of a variety of cancers and other serious diseases since the 1960s.
According to the International Bone Marrow Transplant Registry, over 45,000 bone
marrow and other hematopoietic (blood) stem cell transplant procedures were
performed worldwide in 2002.

         The flexibility and plasticity of stem cells has led many researchers
to believe that stem cells have tremendous promise in the treatment of diseases
other than those currently addressed by stem cell procedures. Researchers have
reported progress in the development of new therapies utilizing stem cells for
the treatment of cancer, neurological, immunological, genetic, cardiac,
pancreatic, liver and degenerative diseases.

UMBILICAL CORD BLOOD BANKING

         The success of current and emerging cell therapies is dependent on the
presence of a rich and abundant source of stem cells. Umbilical cord blood has
been emerging as an ideal source for these cells. As information about the
potential therapeutic value of stem cells has entered the mainstream, and
following the first successful cord blood transplant performed in 1988, cord
blood collection has grown.

         In the past decade, several public and private cord blood banks have
been established to provide for the collection and preservation of these cells.
Public cord blood banks collect and store umbilical cord blood donated by women
at the birth of the child. This blood is preserved and made available for a fee
(usually $10,000 to $20,000) to anyone who needs it in the future. We do not
currently collect or store donated cord blood units. Private, or family, cord
blood banks such as CPI, collect and store umbilical cord blood on a
fee-for-service basis for families. This blood is preserved and made available
to the family in the event the family needs stem cells for a transplant. While
stem cells have been successfully recovered from cord blood after at least

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<PAGE>

fifteen years of storage in liquid nitrogen, these cells should theoretically be
able to retain their usefulness at least as long as the normal life span of an
individual.

SERVICES PROVIDED BY CPI

         Through our CPI subsidiary, we collect, test, process and preserve
umbilical cord blood. Our customers are expectant parents who choose to collect
and store umbilical cord blood at the birth of their child for potential use in
a stem cell transplant at a later date for that child or for another family
member.

         Private cord blood banking has been growing in acceptance by the
medical community and has become increasingly popular with families. For an
initial fee of $1,695 and an annual storage fee of $95 for each year thereafter,
we provide the following services to each customer:

         Collection. We provide a 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.

         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 on the collection of the cord blood.

         Transportation. We manage all logistics for transporting the cord blood
unit to our centralized facility immediately following birth. This procedure
ensures chain-of-custody control during transportation for maximum security.

         Comprehensive Testing. At the laboratory, the cord blood unit sample is
tested for stem cell concentration levels and blood type. The cord blood unit
and the maternal blood sample are also tested for infectious diseases. We report
these results to both the mother and her doctor.

         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.

         At present, all of our cord blood units are tested, processed and
stored at, Bergen Community Regional Blood Center in Paramus, New Jersey.

BLOOD BANK SERVICE AGREEMENT

         Pursuant to our Service Agreement with Bergen Community Regional Blood
Center, the blood center tests all cord blood received from CPI and stores the
cord blood in computerized, temperature monitored liquid nitrogen vapor tanks or
other suitable storage units. Individual cord blood samples can be retrieved
upon request. The blood center is compensated for its services based upon the
number of umbilical cord blood units stored with it by CPI each month.

                                       6
<PAGE>

         Our agreement with the blood center runs through June 30, 2012.
However, our agreement may be terminated by either party on 90 days notice.
Several other blood centers also provide the services currently provided to us
by Bergen Community Regional Blood Center. If our agreement with Bergen
Community Regional Blood Center were to terminate for any reason, we believe
that comparable services could be secured from another provider at comparable
cost within the contractual notice period. However, we may not be able to secure
such terms or secure such terms within such time frame. In such event, we may
not be able to continue to provide our cord blood banking services for some
period of time or our expenses of storage may increase, or both. This would have
an adverse effect on our financial condition and results of operations.

         We are responsible for securing the proper collection and
transportation of the cord blood to Bergen Community Regional Blood Center.
Bergen Community Regional Blood Center is responsible for the proper testing,
processing and storage of the cord blood delivered to it. Upon request by
customer or a customer's physician for release of stored cord blood or
termination of our agreement, Bergen Community Regional Blood Center is not
responsible for any cord blood once it is properly released to a courier or
delivery service.

         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. Our
agreement provides that each party will indemnify the other from its respective
acts, errors or omissions in performing its respective obligations under the
agreement.

PATENT LICENSE AGREEMENT

         PharmaStem Therapeutics, Inc. ("PharmaStem") holds certain patents
relating to the storage, expansion and use of hematopoietic stem cells. In the
past two years, PharmaStem has commenced suit against numerous companies
involved in cord blood collection and preservation alleging infringement of its
patents. In October 2003, after a jury trial, judgment was entered against
certain of our competitors and in favor of PharmaStem in one of those suits.

         In February 2004, PharmaStem commenced suit against CPI and certain of
its competitors alleging infringement of its patents. Management of CPI
determined to settle, rather than to litigate, this matter. As a result,
PharmaStem and CPI entered into a Patent License Agreement in March 2004.

         Pursuant to the Patent License Agreement, CPI 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 may remain in
effect. All of the patents are scheduled to expire in 2010. CPI is obligated
under the Patent License Agreement to pay royalties to PharmaStem of 15% of all
revenues generated by CPI from the collection and storage of cord blood on and
after January 1, 2004. Other than royalties, no amount is payable by CPI to
PharmaStem. All litigation between the parties was dismissed and all prior
claims were released.

                                       7
<PAGE>

MARKETING

         The marketing of our services is based upon the education of our
potential customers. Most people do not know about the medical benefits that
stem cells can provide and, even when they do, they may not know that stem cells
saved from the birth of their child could have significant value to their
family. We attempt to inform and educate our potential customers as to these
benefits.

         We utilize several methods to educate our potential customers.
Primarily, we use our website (www.cordpartners.com), printed information kits
and brochures to educate families about the benefits and costs of cord blood
storage. We provide potential customers with access to basic information about
stem cells and their current and potential uses in medical treatment. We also
educate potential customers as to their options with regard to private storage,
public donation and disposal of umbilical cord blood as well as various
collection methods, transportation of samples, laboratory testing and
preservation techniques. We provide potential customers with the option of
having a one-on-one counseling session with a Cord Partners Preservation
Counselor.

         We help potential customers find non-commercial resources to provide
further information about stem cells and their uses in medical treatment and
cord blood banks. The most referred sources include: The Parents Guide to Cord
Blood (www.parentsguidecordblood.com), the National Institute of Health
(www.nih.gov) and the National Marrow Donor Program (www.marrow.org).

         Our marketing campaigns are designed to capture as many qualified leads
as possible so as to enable us to educate potential customers about their
storage options. A marketing campaign is any promotion which is aimed at
reaching numerous potential customers. This can be achieved through one or many
advertising media. At present, our marketing focuses on the following: personal
referrals, professional referrals, internet advertising, print advertising,
radio advertising, television advertising, direct mail, baby fairs and public
relations.

         We funnel our leads through a well-defined process which utilizes
numerous methods for educating our potential clients, including direct mail,
email and telephone consultations. To us, the most important aspect of our work
is to try to teach expectant families what their umbilical cord blood
preservation options may be. While we would like to convert all leads into
customers, it is most important that each family is aware of the private and
public storage options available to them so that they can make an informed
decision.

         All of our marketing efforts are designed and implemented by our
employees. Our website was designed and is maintained and hosted by Gecko Media,
Inc. Stephen Weir, a director of the Company, is a founder, principal
shareholder, director and officer of Gecko Media, Inc.

         Because of our internet presence, our marketing efforts are worldwide
in scope. Nevertheless, virtually all of our customers reside in the United
States.

COMPETITION

         Our competitors in the cord blood preservation industry include the
approximately 20 other national private family cord blood banks in the United
States, including Viacell, California Cryobank, Cbr Systems (Cord Blood
Registry), Cryo-Cell International, CorCell, LifeBankUSA, and New England Cord

                                       8
<PAGE>

Blood Bank. These companies privately store umbilical cord blood on a fee basis.
Some of our competitors, including Cryo-Cell and LifeBankUSA, charge a lower
price for their products than we do. Other competitors such as Viacell and Cbr
Systems may have greater financial resources than we do. There are also more
than fifty public cord blood banks throughout the world, including the New York
Blood Center (National Cord Blood Program), University of Colorado Cord Blood
Bank, Milan Cord Blood Bank and Duesseldorf Cord Blood Bank. These competitors
accept and store cord blood for little or no compensation, but charge a
significant fee for the retrieval of the cord blood.

         Our ability to compete with other private family and public cord blood
banks will depend on our ability to distinguish ourselves as a leading provider
of quality cord blood banking services. We believe that three factors
distinguish our services. First, unlike many of our larger competitors, we have
entered into a Patent License Agreement with PharmaStem. This ensures our
ability to continue to provide cord blood banking services to our customers.
Second, unlike many of our competitors, our initial fee covers all services for
the first year, including collection, transportation, testing, processing and
preservation of the cord blood. Several of our competitors do not include all of
these services in their initial fee. Finally, we provide individualized services
to all of our customers. At the time of enrollment, each customer is assigned
their own customer service representative, referred to as a "Cord Partner." The
Cord Partner is available to their customers 24 hours per day, 7 days per week,
via a toll free pager number. Each Cord Partner is trained not only to handle
all customer inquires, but to communicate with labor and delivery staff in the
event questions arise before, during or subsequent to delivery of the child.

GOVERNMENT REGULATION

         The cord blood banking service provided by CPI is subject to Food and
Drug Administration ("FDA") regulations requiring infectious disease testing.
CPI has registered with the FDA as a cord blood banking service, has listed its
products with the FDA, and will be subject to FDA inspection. In addition, the
FDA has proposed good tissue practice regulations that would establish a
comprehensive regulatory program for human cellular and tissue-based products a
well as proposed rules for donor suitability. Furthermore, the FDA may develop
standards for these products.

         Consistent with industry practice, the CPI cord blood collection kits
have not been cleared as a medical device. The FDA could at any time require us
to obtain 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. The FDA could also
require that we cease using the collection kit and require us to obtain medical
device pre-market notification clearance or approval prior to further use of the
kits.

         Of the states in which we provide cord blood banking services, only New
Jersey and New York currently require that cord blood banks, such as our storage
facility, be licensed. Our blood storage facility, Bergen Community Regional
Blood Center, is currently licensed to operate in these two states. If other
states adopt requirements for licensing of cord blood services, either our blood
storage facility or we would have to obtain licenses to continue providing
services in those states.

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<PAGE>

SERVICES PROVIDED BY CBA PROFESSIONAL SERVICES

         CBA Professional Services, Inc. is currently in the developmental
stage. It is in the business of recruiting potential franchisees. The franchise
model is a business to business sales model utilizing healthcare professionals
to sell our services directly from their practices. The strategy is to earn
revenues from both franchise fees and the business to business sales.

CBA PROPERTIES, INC.

         CBAPI intends to hold all of the trademarks of Cord Blood America and
its subsidiaries. The trademarks were applied for in the fourth quarter of 2004

DEPENDENCE ON ONE OR A FEW MAJOR CUSTOMERS

         The Company is not currently reliant on one or a few major customers.
Our customer base is made up of many different parents and parents to be.

EMPLOYEES

         At present, the Company employs fifteen full time employees and one
part-time employee. The organization facilitates an exciting, growing and
dynamic environment, which has assisted in the recruitment and retention of an
exceptional staff. Our full time employees include our Chairman of the Board and
Chief Executive Officer, our President and Chief Operating Officer and our Chief
Financial Officer. We believe our relations with all of our employees are
excellent.

REPORTS TO SECURITY HOLDERS

         The Company makes news releases, financial and other information
available on it's Corporate website at www.cordblood-america.com. There is a
direct link to all of the Company's Securities and Exchange Commissions filings
via the EDGAR database on the Corporate website. The Company's annual reports on
Form 10-KSB, quarterly reports on form 10-QSB, current reports on Form 8-K and
any amendments to those reports filed or furnished pursuant to Section 13(a) or
15(d) of the Securities Exchange Act of 1934 are accessible from the link free
of charge or by going directly to http://www.sec.gov/. The public may also read
and copy any materials filed by us with the SEC at the SEC's Public Reference
Room at 450 Fifth Street, N.W., Washington, D.C. 20549. Information on the
operation of the SEC's Public Reference Room may be obtained by calling the SEC
at 1-800-SEC-0330.

ITEM 2.  DESCRIPTION OF PROPERTY
         -----------------------

         The Company's principal office is located at 9000 W. Sunset Boulevard,
Suite 400, West Hollywood, California, 90069. The property is a suite of
approximately 2,000 square feet. The property is leased from an unaffiliated
third party for a period of five years ending September 30, 2009. The monthly
lease payments are approximately $6000.

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<PAGE>

         The lease on the Company's previous principal office, 10941 Wilshire
Blvd., Fourth Floor, Los Angeles, California, 90069, was terminated effective
September 30, 2004.

         The Company maintains tenant fire and casualty insurance on its leased
property in an amount deemed adequate by the Company.

ITEM 3.  LEGAL PROCEEDINGS
         -----------------

         In May 2004, we received a complaint filed in the Superior Court of the
State of California by Kenneth D. Worth, purportedly by and for the People of
the State of California, and naming as defendants a number of private cord blood
banks, including us. The complaint alleges that the defendants have made
fraudulent claims in connection with the marketing of their cord blood banking
services and seeks restitution for those affected by such marketing, injunctive
relief precluding the defendants from continuing the allegedly abusive and
fraudulent marketing of their services, unspecified punitive damages and
attorney's fees. In October 2004, the Court ruled that the complaint was
stricken and no longer operative with respect to each defendant. A motion for
reconsideration was filed by the Plaintiff requesting the Court consider new
evidence.

Item 4.  Submission of Matters to a Vote of Security Holders
         ---------------------------------------------------

         NONE

PART II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS
         --------------------------------------------------------

MARKET INFORMATION

         As of December 31, 2004 our shares of common stock had never traded on
any securities exchange. Therefore, there is no market information to report as
of December 31, 2004. On January 21, 2005, the Company's stock began trading on
the OTC Bulletin Board under the symbol "CBAI.OB".

SHARES AVAILABLE FOR FUTURE RESALE

         As of December 31, 2004, options to purchase 1,750,000 shares of our
common stock were outstanding. As of December 31, 2004, warrants to purchase
1,000,000 shares of our common stock were outstanding. As of December 31, 2004,
4,027,200 shares of our common stock are believed to be capable of being sold or
transferred without registration under the Securities Act of 1933.

HOLDERS

         As of December 31, 2004, there were approximately 636 shareholders of
record.

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DIVIDENDS

         We have never declared or paid a cash dividend. There are no
restrictions on the common stock or otherwise that limit the ability of us to
pay cash dividends if declared by the Board of Directors. The holders of common
stock are entitled to receive dividends if and when declared by the Board of
Directors, out of funds legally available therefore and to share pro-rata in any
distribution to the shareholders. Generally, we are not able to pay dividends if
after payment of the dividends, we would be unable to pay our liabilities as
they become due or if the value of our assets, after payment of the liabilities,
is less than the aggregate of our liabilities and stated capital of all classes.

         We do not anticipate declaring or paying any cash dividends in the
foreseeable future.

         On April 2, 2004, we declared and paid a two for one stock split,
effected as a stock dividend, to all of our shareholders.

EQUITY COMPENSATION PLANS

         None of our securities were authorized for issuance pursuant to any
equity compensation plan as of December 31, 2004.

ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS

GENERAL
-------

         In addition to the historical information contained herein, we make
statements in this Annual Report on Form 10-KSB that are forward-looking
statements. Sometimes these statements will contain words such as "believes,"
"expects," "intends," "should," "will," "plans," and other similar words. 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. We do not assume the obligation to
update or revise any forward-looking statements.

         The acquisition of the Company's first subsidiary corporation, Cord
Partners, Inc., occurred on March 31, 2004. Active operations of Cord Partners,
Inc., commenced in January 2003. On November 12, 2004, the Company formed its
second subsidiary corporation, CBA Professional Services, Inc., as well as its
third subsidiary, CBA Properties, Inc.. On February 28, 2005, the Company
acquired its fourth subsidiary corporation, Career Channel, Inc. d/b/a
Rainmakers International. Rainmakers International commenced operations in March
of 2001. Therefore, the Company only has a limited operating history.

                                       12
<PAGE>

PLAN OF OPERATION
-----------------

         Over the next twelve months, the Company plans to continue the organic
growth of its subsidiary, Cord Partners, through continued improvement of
internal processes, viral marketing, expanded internet marketing efforts and the
addition of salespeople to facilitate increased prospective customer contact.
CPI will also be concentrating efforts on building additional sales channels
through Obstetrics and Gynecological practices and other healthcare
professionals. The Company also intends to experience growth through mergers
and/or acquisitions of other stem cell preservation companies. The Company is
currently exploring several acquisition opportunities and will continue to do so
throughout the next year.

         The Company also has plans to establish a network of franchisees
through its subsidiary, CBA Professional Services. The franchise model will be
based on the practices of CPI's external sales representatives whereby
healthcare professionals are directly contacted to promote enrollment in one of
CPI's healthcare professional programs.

         The Company will also be focusing on the operations of its recent
acquisition, Rainmakers International. Rainmakers is a family advertising
company specializing in television and radio advertising campaigns. The Company
has dedicated additional resources to expand upon the successful model that
Rainmakers has developed and will continue to allocate resources over the next
twelve months. It is also management's goal to incorporate Rainmakers' expertise
in the advertising arena to increase the brand awareness of CPI.

         The Company is currently in negotiations to acquire Family Marketing,
Inc., an internet marketing and lead generation firm. It is management's intent
for Family Marketing to compliment Rainmakers International by providing per
inquiry advertising across all channels including the internet. Family Marketing
will also handle all internet marketing for CPI to provide a more systematic and
thorough approach to the current marketing efforts of CPI.

REVENUES AND COST OF SERVICES GENERALLY
---------------------------------------

         Through December 31, 2004, our revenues were derived from the sale of
the following products and services: an umbilical cord blood collection kit,
transport of collected cord blood to Bergen Community Regional Blood Center, the
testing, processing and first year of storage of the cord blood at the Bergen
Community Regional Blood Center and general physician and customer support.
These products and services were bundled and sold at a fixed fee of $1,350
through February 28, 2004 and were increased to $1,595 on March 1, 2004. In
addition, Cord Partners' clients who had received similar services in 2003 were
billed for an annual storage fee of $95 per year. This maintenance fee will
continue to be billed annually so long as the client chooses to store their cord
blood. Beginning January 1, 2005, the initial service fee of $1,595 was
increased to $1,695, while the annual maintenance fee remained at $95.

         The principal components of our cost of services are: the cost of the
umbilical cord blood collection kit, royalty payments to PharmaStem
Therapeutics, Inc. ("PharmaStem"), payments for processing and storage services
to Bergen Community Regional Blood Center, costs of transportation of the
umbilical cord blood collection kit to the expectant family and costs of the
transportation of the umbilical cord blood to Bergen Community Regional Blood
Center. The bulk of our cost of services is our royalty payments to PharmaStem

                                       13
<PAGE>

and our payments for services to Bergen Community Regional Blood Center. At
present, PharmaStem receives royalties of 15% of all revenues generated from the
collection and storage of cord blood. Bergen Community Regional Blood Center
receives payments of $577.50 for each new collection and storage of cord blood
and $50 per year for each storage of cord blood thereafter.

         As of February 28, 2005, a portion of the Company's revenues will also
be derived from the sale of services by Career Channel, Inc. d/b/a Rainmakers
International ("Rainmakers"). Rainmakers was acquired on February 28, 2005 and
is in the business of advertising. Sources of revenue for Rainmakers include:
procuring and placing internet advertising, procuring and placing radio and
television advertising; per-inquiry advertising on radio and television;
production of radio and television commercials, procuring and setting up call
centers; editing, dubbing and distribution of radio and television commercials;
and procuring and placing print advertising.

         Costs of services associated with the revenues of Rainmakers are as
follows: set up and per minute charges from the procured call center; set up,
filming, recording, creating graphics, editing, dubbing and distribution or
commercials produced; media venue fees for advertising procured; and/or media
venue fees for sales leads generated via per inquiry advertising.

TWELVE MONTHS ENDED DECEMBER 31, 2004 AND DECEMBER 31, 2003
-----------------------------------------------------------

         For the twelve months ended December 31, 2004, the Company had revenues
of $751,850 and a net loss of $1,647,290, as compared to revenues of $281,175
and a net loss of $45,838 for the twelve months ended December 31, 2003. We
believe that our sales will continue to increase as the result of our marketing
efforts, the growth of our internal sales team and our efforts in exploring
additional sales channels for our services. We also believe revenues will
increase due to the acquisition of Rainmakers International, an advertising
company, that took place on February 28, 2005. Rainmakers' unaudited revenues in
2004 were approximately $800,000. We believe the increase in revenue in 2004 is
due in part to the execution of the following strategies. In 2004, we
significantly expanded both our print and internet advertising campaigns which
lead to increases in the number of prospective customer inquiries in our
services. We consistently communicated with these prospective customers through
direct mail and e-mail. Our consumer website and our consumer information guides
were redesigned in 2004 to increase overall awareness of umbilical cord blood
stem cell preservation as well as the Cord Partners brand. Prospective customer
management productivity was also increased, by outsourcing both the production
and fulfillment of the information guides. Due to the addition of two internal
sales people in October 2004, we were able to contact an increased number of
prospective clients and schedule more frequent follow-ups. We expanded our
efforts by directly contacting OB/GYN's in the Southern California region to
boost awareness of our services by both expectant families and their doctors.
Additionally, we established relationships with three independent sales
representatives in two markets, Miami and Raleigh-Durham. This enabled us to
promote our services with OB/GYN's in areas outside of the Company's geographic
location. In addition, we implemented a price increase for our products and
services in March 2004. This price increase was intended to offset, at least in
part, the increase in our cost of services resulting from our entering into a
Patent License Agreement with PharmaStem Therapeutics.

                                       14
<PAGE>

         For the twelve months ended December 31, 2004, the cost of our services
was $597,348, as compared to $198,770 for the twelve months ended December 31,
2003. For the twelve months ended December 31, 2004, our gross profit was
$154,502 and our gross profit percentage was 21%, as compared to gross profit of
$82,405 and gross profit percentage of 29% for the comparable period of 2003.
For the twelve months ended December 31, 2004, the cost of our services
increased for two primary reasons. First, the number of families choosing to
utilize our services increased over the comparable period in 2003 therefore, the
associated costs increased. Second, the addition of royalties payable to
PharmaStem under the Patent License Agreement totaled $121,848. This was a new
cost in 2004.

         For the twelve months ended December 31, 2004, our administrative and
selling expenses were $1,745,279, as compared to $128,243 for the twelve months
ended December 31, 2003. Our administrative and selling expenses increased as a
result of several factors. First, we scaled our internet advertising across
multiple websites, launched several e-mail campaigns and utilized extensive "pay
per click" advertising channels which all contributed to the $214,300 increase
in web advertising expense during 2004. Second, we increased our print
advertising by approximately $144,600 in 2004 by increasing the number of
publications we advertised in as well as the frequency. The production of our
marketing materials and associated postage and delivery expenses increased by
approximately $182,500 in 2004 due to extensive distribution of consumer
information guides, increased direct mailings and a rise in the dispersal of
brochures to OB/GYN offices. Our expenses for development, maintenance and
hosting of our websites increased by approximately $67,700 in 2004 per our Web
Development and Maintenance Agreement with Gecko Media. In February 2004, we
expanded our existing executive suite office space and by October 2004 we
relocated to an even larger, traditional office space, which increased our rent,
utility and associated relocation expenses by approximately $61,300. With the
addition of six new employees in 2004, we incurred an increase in wage and
payroll burden expense of $418,900. This contributed to the approximate $45,800
increase in other employee related expenses such as furniture lease expense,
parking expense and office supplies expense. In July of 2004, we implemented a
new accounting and CRM system, which contributed to $12,000 in software and
consulting fee expenses. Our insurance expense increased in 2004 by
approximately $56,800 as the result of additional coverage required by our
Patent License Agreement with PharmaStem as well as the addition of a Directors
and Officers policy. Travel expense increased by approximately $16,300.
Professional fees increased by approximately $234,800 in 2004 as the result of
the cost of going public, unforeseen litigation and consulting fees to establish
a distributor program. We also incurred approximately $20,000 in other public
company related expenses such as investor relations, filings, listings and stock
transfer and issuance expenses. All of these expenses were new to the Company in
2004. We spent approximately $87,500 in fees for consulting our organization on
how to raise capital in 2004. Finally, our interest expense increased by
approximately $56,300 in 2004 due to the obligations of four loans entered into
during the period.

         At December 31, 2004, we had current assets of $281,935 and current
liabilities of $1,607,711, resulting in a working capital deficit of $1,325,776.
At December 31, 2004, we had deferred revenue of $135,177, resulting from our
entering into contracts with expectant parents pertaining to products or
services that had not yet been provided.

                                       15
<PAGE>

LIQUIDITY AND CAPITAL RESOURCES
-------------------------------

         We continue to experience substantial cash flow difficulties and we
expect to experience cash flow difficulties for an indefinite period. As a
result, we have no plans to make any material capital expenditures. At December
31, 2004, we had a working capital deficit of $1,325,776. Although no assurances
can be given, we believe that our cash flow deficit will improve as revenues and
sales increase. In addition, although no assurances can be given, we believe
that we may be able to secure additional equity and/or debt financing.

         On December 31, 2004, the Company held accounts receivable (net of
allowance for doubtful accounts) of $94,262. Accounts receivable are generally
kept current through punctual collections efforts.

         On August 12, 2004, we entered into a loan transaction with an
unaffiliated party pursuant to which we borrowed $500,000. The loan bears
interest at the rate of 8% per annum and is unsecured. Commencing on February
15, 2005, and continuing on the fifteenth day of each calendar month through and
including July 15, 2005, we are obligated to pay to the lender an amount equal
to 5% of our consolidated gross revenues for the immediately preceding calendar
month. Payments are applied first to interest accrued and then to the
outstanding principal amount. The entire amount of the loan and all interest
accrued thereon is finally due and payable on August 15, 2005.

         On September 17, 2004, we entered into a Loan Agreement with the same
unaffiliated party. Pursuant to that agreement, we borrowed an additional
$250,000. The loan bears interest at 10% per annum and is unsecured. If the
$500,000 loan referred to above is paid in full, then commencing on the first to
occur of the date of such payment or February 15, 2005, and continuing on the
fifteenth day of each calendar month through and including August 15, 2005, we
are obligated to continue to pay to the lender an amount equal to 5% of our
consolidated gross revenues for the immediately preceding calendar month.
Payments are applied first to interest accrued and then to the outstanding
principal amount. The entire amount of the loan and all interest accrued thereon
is finally due and payable on September 15, 2005. The agreement also includes
warrants issued to the lender to purchase 500,000 shares of our common stock.
The warrants are exercisable for a period of five years at an exercise price of
$0.1875.

         On October 21, 2004, we entered into a Loan Agreement with the same
unaffiliated party. Pursuant to that agreement, we borrowed an additional
$250,000. The loan bears interest at 10% per annum and is unsecured. If certain
of our obligations are paid in full, then commencing on the first to occur of
the date of such payment or February 15, 2005, and continuing on the fifteenth
day of each calendar month through and including September 15, 2005, we are
obligated to continue to pay to the lender an amount equal to 5% of our
consolidated gross revenues for the immediately preceding calendar month.
Payments are applied first to interest accrued and then to the outstanding
principal amount. The entire amount of the loan and all interest accrued thereon
is finally due and payable on October 15, 2005. The agreement also includes
warrants issued to the lender to purchase 500,000 shares of our common stock.
The warrants are exercisable for a period of five years at an exercise price of
$0.1875.

                                       16
<PAGE>

         On January 17, 2005, our wholly-owned subsidiary, CBA Professional
Services, Inc. borrowed $100,000 from Joseph R. Vicente, a director of our
company, on an unsecured basis. The loan is for a period of one year and bears
interest at 6% per annum. Interest is payable on a monthly basis on the
sixteenth day of each calendar month, commencing on February 16, 2005 and
continuing each month thereafter through and including January 16, 2006. The
entire principal amount of this Note, together with any and all unpaid interest
accrued thereon, shall be finally due and payable on January 16, 2006.

         On March 8, 2005, CBA Professional Services repaid $95,000 of the
$100,000 loan to Joseph R. Vicente. This was decided on due to the recruitment
of franchisees by CBA Professional Services being put on hold, as management
felt it would be beneficial to further test the franchise model before
continuing with its recruitment efforts.

         On March 24, 2005, CPI sold $94,682 in future credit card receivables
to a third party, AdvanceMe Inc., for the purchase price of $70,000. 17% of all
Visa and MasterCard sales will be automatically deducted by AdvanceMe, Inc.
until $94,682 is received.

         On March 22, 2005, Cord Blood America, Inc. entered into a Standby
Equity Distribution Agreement with an unaffiliated party, Cornell Capital
Partners, LP. The agreement states that Cord Blood America, Inc. (the "Company")
shall issue and sell to Cornell Capital Partners, LP (the "Investor) from time
to time as provided, and the Investor shall purchase from the Company up to Five
Million U.S. Dollars ($5,000,000) of the Company's common stock, par value
$0.0001 per share. Such investments will be made in reliance upon the provisions
of Regulation D of the Securities Act of 1933, as amended, and the regulations
promulgated thereunder (the "Securities Act"), and or upon such other exemption
from the registration requirements of the Securities Act as may be available
with respect to any or all of the investments to be made hereunder.

         The Company may request, by written notice to the Investor, an advance
in the amount requested by the Company, not to exceed $250,000 per advance. The
request by the Company to the Investor shall also contain a requested advance
date. The number of shares of Common Stock the Investor shall receive for each
advance will be determined by dividing the amount of the advance by 98% of the
lowest volume weighted average price of the Company's stock as quoted by
Bloomberg, LP during the period, 5 consecutive trading days after the date the
Company delivers notice to the Investor to advance the funds to the company.

         The total aggregate amount of all advances shall not exceed Five
Million U.S. Dollars ($5,000,000). The length of the agreement shall not exceed
twenty-four (24) months after the date on which the SEC first declares effective
a Registration Statement registering the resale of the Registrable Securities as
set forth in Section 7.2(a) of Exhibit 10.17.

         The Company intends to use advances of the Standby Equity Distribution
Agreement to assist in the offset of our current cash flow difficulties.
However, the Company must first file and the SEC must declare effective a
Registration Statement registering the resale of the Registrable Securities as
set forth in Section 7.2(a) of Exhibit 10.17, before an advance can be made.
Without use of the advances, we believe we have sufficient operating capital
through April of 2005. Also, if we fail for any reason to repay any of the above
loans on a timely basis, then we may have to curtail our business sharply or
cease operations altogether.

                                       17
<PAGE>

         A critical component of our operating plan that may have a substantial
impact on our continued existence is our ability to obtain capital through
additional equity and/or debt financing. We do not anticipate adequate positive
internal operating cash flow until such time as we can generate substantially
greater revenues than we are generating at present.

         Our near term cash requirements are anticipated to be offset through
the receipt of funds through private placement offerings and additional equity
and/or debt financing. Since inception, we have financed cash flow requirements
through the issuance of common stock for cash, services and loans. As we expand
our operational activities, we may continue to experience net negative cash
flows from operations and we will be required to obtain additional financing to
fund operations through common stock offerings and borrowings to the extent
necessary to provide working capital. No assurance can be made that such
financing will be available, and, if available, whether it will take the form of
debt or equity. Should we secure such financing, such financing 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.

FACTORS THAT MAY AFFECT FUTURE OPERATING RESULTS
------------------------------------------------

RISKS RELATED TO OUR BUSINESS

WE HAVE A HISTORY OF LOSSES AND WE MAY NOT ACHIEVE PROFITABILITY.

         During the year ended December 31, 2003, we incurred a loss of $45,838,
and during the twelve months ended December 31, 2004, we incurred a loss of
$1,647,290. At December 31, 2004, we had a capital deficit of $1,291,646, and a
working capital deficit of $1,325,776. We expect our operating expenses to
increase as we experience growth. Our growth has required us to hire additional
employees and move to larger office space. As a result, we will need to generate
significant additional revenues to achieve and maintain profitability. We cannot
assure our shareholders that we will achieve significant additional revenues, or
that we will become profitable and, if so, sustain profitability into the
future. It is possible that we may encounter unexpected expenses. If the time
required to generate significant revenues and achieve profitability is longer
than anticipated, we may need to obtain working capital in the future. There can
be no assurance that we will be able to successfully complete any such financing
arrangements or that the amounts raised would meet our cash flow needs. We
cannot assure our shareholders that additional capital will be available to us
in the future on favorable terms, or at all. The various elements of our
business strategies, including marketing activities and obtaining increased
market acceptance, may require additional future capital. If adequate funds are
not available or are not available on acceptable terms, our ability to fund
those business activities essential to operate profitably, including further
sales and marketing activities, would be significantly limited.

                                       18
<PAGE>

OUR AVAILABLE CASH WILL PERMIT US TO OPERATE ONLY FOR A FEW MONTHS. WE WILL NEED
TO RAISE ADDITIONAL CAPITAL.

         As of December 31, 2004, the Company had current assets of $281,935 and
current liabilities of $1,607,711, resulting in a working capital deficit of
$1,325,776. We believe that we have sufficient operating capital through April
of 2005. There can be no assurance that sales will continue to increase or even
maintain current levels. We will require additional capital to fund our
operations. The failure of the Company to obtain financing as needed would have
a material adverse effect upon the Company and its business as we believe our
current cash position will enable us to sustain current operations for a short
period of time. If additional funds are obtained by issuing equity securities
and/or debt securities convertible into equity, dilution to existing
shareholders will result, and future investors may be granted rights superior to
those of existing shareholders. There can be no assurances, however, that
additional financing will be available when needed, or if available, on
acceptable terms. There are no current agreements, arrangements, or
understandings for any equity and/or debt financing. The failure of the Company
to obtain such financing as required or otherwise desired will have a material
adverse effect upon the Company, its business and operations.

OUR FINANCIAL STATEMENTS ARE SUBJECT TO A "GOING CONCERN" QUALIFICATION.

         Our audited annual financial statements appearing in this filing have
been prepared on a going concern basis that contemplates the realization of
assets and the settlement of liabilities and commitments in the normal course of
business. Management realizes that we must generate capital and revenue
resources to enable us to achieve profitable operations. We are planning on
obtaining additional capital by achieving at least break-even cash flow from
operations and selling equity and/or debt securities. The realization of assets
and satisfaction of liabilities in the normal course of business is dependent
upon us obtaining additional revenues and equity capital and ultimately
achieving profitable operations. No assurances can be made that we will be
successful in these activities. Should any of these events not occur, our
financial statements will be materially affected.

IF OUR UMBILICAL CORD BLOOD PROCESSING AND STORAGE SERVICES DO NOT ACHIEVE
CONTINUED MARKET ACCEPTANCE, WE WILL NOT BE ABLE TO GENERATE REVENUE NECESSARY
TO SUPPORT OUR BUSINESS.

         We anticipate that service fees from the processing and storage of
umbilical cord blood will comprise a large portion of our revenues for the
foreseeable future and, therefore, our future success depends on the successful
and continued market acceptance of this service. Broad use and acceptance of our
service requires marketing expenditures and education and awareness of consumers
and medical practitioners. The time and expense required to accomplish such
education and awareness of our services and its potential benefits could
adversely affect market acceptance. 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.

                                       19
<PAGE>

WE MAY NOT BE ABLE TO INCREASE SALES OR OTHERWISE SUCCESSFULLY OPERATE OUR
BUSINESS.

         We believe that the key to our success is to increase sales of our cord
blood preservation services and thereby increase our revenues and available
cash. Our success in this regard will depend in large part on widespread market
acceptance of cryopreservation of cord blood and our efforts to educate
potential customers and sell our services. Our efforts to increase our sales and
revenues could be adversely impacted by other risks to our business described
below, including termination of our agreement with Bergen Community Regional
Blood Center, a failure, discontinuance or disruption of the Bergen Community
Regional Blood Center to preserve stored cord blood, termination of our
agreement with PharmaStem and increased competition from other providers of cord
blood storage services.

         There can be no assurance that we will be able to increase our sales or
effectively operate our business. To the extent we are unable to achieve growth
in sales, we may continue to incur losses. We cannot assure you that we will be
successful or make progress in the growth and operation of our business.

         Our current and future expense levels are based on our operating plans
and estimates of future sales and revenues and are subject to increase as we
implement our strategy. 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 should 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 effected 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 revenue could be adversely affected.

WE ARE DEPENDENT UPON A THIRD PARTY FACILITY FOR THE STORAGE OF UMBILICAL CORD
BLOOD. IF OUR STORAGE ARRANGEMENTS TERMINATE 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
Bergen Community Regional Blood Center terminate for any reason, then 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.

A FAILURE IN THE PERFORMANCE OF OUR CRYOPRESERVATION STORAGE FACILITY OR SYSTEMS
COULD HARM OUR BUSINESS AND REPUTATION.

         To the extent our cryopreservation storage service is disrupted,
discontinued or the performance is impaired, our business and operations could
be adversely affected. We store all of our specimens at the Bergen Community
Regional Blood Center in Paramus, New Jersey. Any failure, including network,
software, hardware or equipment failure, that causes a material interruption or

                                       20
<PAGE>

discontinuance in our cryopreservation storage of stem cell specimens could
result in stored specimens being damaged and unable to be utilized. 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 failures
in our system or interruptions in our ability to maintain proper, continued,
cryopreservation storage services. Any material disruption in our 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,
equipment failure, break-ins, tornadoes and similar events for which we do not
have redundant systems or a formal disaster recovery plan and 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 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, CPI 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 may 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. 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 provided by us are currently subject to
FDA regulations requiring infectious disease testing. We have registered with
the FDA as a cord blood banking service, listed our 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. We believe that we are in compliance with existing
regulatory requirements.

         We may not be able to comply with any future regulatory requirements
that may be imposed on us, including product standards that may be developed
after the date hereof. Moreover, the cost of compliance with government
regulations may adversely affect our 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 our services and impair our ability
to operate profitably in the future.

                                       21
<PAGE>

         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. Our
cord blood storage facility is currently licensed to operate in these two
states. If other states adopt requirements for the licensing of cord blood
banking services, either our cord blood storage facility or we, would have to
obtain licenses to continue providing services in those states.

THE FDA COULD REQUIRE US TO OBTAIN APPROVAL OF OUR CORD BLOOD COLLECTION KITS.

         Consistent with industry practice, the CPI cord blood collection kits
have not been cleared as a medical device. The FDA could at any time require us
to obtain 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 could increase
our costs and reduce our profitability. The FDA could also require that we cease
using the collection kit and require us to obtain medical device pre-market
notification clearance or approval prior to further use of the kits. This could
cause us to cease to operate our business for some period of time.

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.

         Our success will depend, to a significant extent, upon our ability to
enhance and expand the use and utility of our services so that they gain
increased market acceptance. There can be no assurance that expectant parents
will use our services or that our services will 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. The use of stem cells in the treatment of
disease is subject to potentially revolutionary technological, medical and
therapeutic changes. Future technological and medical developments could render
the use of stem cells obsolete and unmarketable. 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.

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.

THE CORD BLOOD BANKING MARKET IS INCREASINGLY COMPETITIVE.

         Cord blood banking and stem cell preservation is becoming an
increasingly competitive business. The barriers to entry are relatively low. Our
business faces competition from other operators of cord blood and stem cell
preservation businesses and providers of cord blood and stem cell storage

                                       22
<PAGE>

services. Certain of our competitors have greater financial and other resources
than we do. Competitors with greater access to financial resources may enter our
markets and compete with us. In the event that we are not able to compete
successfully, our business may be adversely affected and competition may make it
more difficult for us to grow our revenue and maintain our existing business on
terms that are favorable to us.

IF WE ARE NOT ABLE TO RECRUIT AND RETAIN QUALIFIED MANAGEMENT PERSONNEL, WE MAY
FAIL TO DEVELOP OUR POTENTIAL BUSINESS OPPORTUNITIES.

         Our success is highly dependent on the retention of the principal
members of our management and sales personnel. Matthew L. Schissler, our
Chairman and Chief Executive Officer, is critical to our ability to execute our
overall business strategy. Stephanie A. Schissler is critical to our marketing
and sales efforts. We do not presently have any key man life insurance on these
persons; while we intend to apply for such insurance in such amounts as we deem
appropriate, it is uncertain at this time as to when we will apply for and
obtain such insurance.

         Although we are not aware that any of our key employees are currently
planning to retire or leave the company, any key employee could terminate his or
her relationship with us at any time and, subject to any non-competition
agreement with us, work for one of our competitors. Furthermore, our future
growth will require hiring a significant number of qualified management,
administrative and sales personnel. Accordingly, recruiting and retaining such
personnel in the future will be critical to our success. There is intense
competition from other companies for qualified personnel in the areas of our
activities. If we are not able to continue to attract and retain, on acceptable
terms, the qualified personnel necessary for the continued development of our
business, we may not be able to sustain our operations or achieve our business
objectives.

RISKS RELATED TO OUR STOCK

AN ACTIVE PUBLIC MARKET FOR OUR COMMON STOCK MAY NOT BE SUSTAINED AND OUR COMMON
STOCK MAY HAVE A VOLATILE PUBLIC TRADING PRICE.

         An active public market for our common stock may not be sustained. As a
result, our investors may not be able to sell their shares quickly or at the
market price if trading of our stock is not actively maintained. Therefore, the
share price may be volatile.

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
common stock or the potential for such sales may have on the market price of the
common stock prevailing from time to time. Of the 29,270,600 issued and
outstanding shares of common stock of the Company, as of March 24, 2005
4,027,200 shares are believed to be capable of being sold or transferred without
registration under the Securities Act of 1933. The market price of our common
stock could decline as a result of sales of substantial amounts of our common
stock in the public market or the perception that substantial sales could occur.
These sales also may make it more difficult for us to sell common stock in the
future to raise capital.

                                       23
<PAGE>

WE HAVE NOT PAID CASH DIVIDENDS AND DO NOT EXPECT TO IN THE FORESEEABLE FUTURE,
WHICH MEANS THE VALUE OF OUR SHARES CANNOT BE REALIZED EXCEPT THROUGH SALE.

         We have never declared or paid cash dividends. We currently
expect to retain earnings for our business and do not anticipate paying cash
dividends on our common stock at any time in the foreseeable future. Because we
do not anticipate paying cash dividends in the future, it is likely that the
only opportunity to realize the value of our common stock will be through a sale
of those shares. The decision whether to pay cash dividends on common stock will
be made by the Board of Directors from time to time in the exercise of its
business judgment. Furthermore, we may be restricted from paying dividends by
the terms of any credit facility we may enter into in the future.

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 67.5% of our outstanding shares of common stock as of
March 24, 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. In addition, these persons, acting
together, have the ability to control the management and affairs of our company.
This concentration of ownership may harm the market price of our common stock by
delaying or preventing a change in control of our company at a premium price
even if beneficial to our other stockholders.

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 THE COMPANY MAY BE DELAYED OR DISCOURAGED AND THE ABILITY OF THE
SHAREHOLDERS TO CHANGE THE DIRECTION AND MANAGEMENT OF THE COMPANY MAY BE
DELAYED OR LIMITED.

         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 2007. 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. Such provisions may have the effect of delaying
or discouraging any takeover of the Company by others or otherwise delaying or
limiting the shareholders' ability to change the direction and management of the
Company.

OUR COMMON STOCK MAY BE SUBJECT TO THE SEC'S PENNY STOCK SALES RULES.

         The SEC has adopted regulations which generally define penny stocks to
be equity securities that have a market price of less than $5.00 per share. Such
designation imposes additional sale practice requirements on broker-dealers
which sell such securities to persons other than established customers and
institutional accredited investors.

                                       24
<PAGE>

         For transactions covered by these regulations, a broker-dealer must
make a special suitability determination for the purchaser. A broker-dealer must
obtain from the potential purchaser, information concerning the person's
financial situation, investment experience and investment objectives. Based upon
that and other information available, the broker-dealer must make a
determination that transactions in penny stocks are suitable for the purchaser
and that the purchaser has sufficient knowledge and experience in financial
matters so that the purchaser reasonably may be expected to be capable of
evaluating the risks of transactions in penny stocks. A broker-dealer must also
receive the purchaser's written consent to the transaction prior to sale.

         These penny stock rules may restrict the ability of brokers, dealers
and investors to sell our common stock to the extent our common stock may be
subject to such rules.

RECENT 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 June 15, 2005. The impact of adopting FASB
Statement No. 123R will only be known when new options are issued in the periods
after the effetive date.

OFF-BALANCE SHEET ARRANGEMENTS
------------------------------

         We have no 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 7.  FINANCIAL STATEMENTS
         --------------------

Item 8.  Changes In and Disagreements With Accountants on Accounting and
         ---------------------------------------------------------------
         Financial Disclosure
         --------------------

         There have been no changes in accountants. There have been no
disagreements with our accountants on accounting and financial disclosure.

PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS
         ------------------------------------------------------------

(a)      Directors and Executive Officers

         The names, ages and positions of all of our current directors and
executive officers are listed below, followed by a summary of their respective
business experience during the past five years.

                                       25
<PAGE>


NAME                          AGE       POSITION
----------------------      -------     ---------------------------
Matthew L. Schissler          33        Chairman of the Board and
                                        Chief Executive Officer

Stephanie A. Schissler        32        Chief Operating Officer and
                                        President, Cord Partners

Sandra D. Smith               33        Chief Financial Officer

Noah Anderson                 25        Chief Technology Officer

Joseph R. Vicente             42        Director

Stephen Weir                  32        Director

         Matthew L. Schissler is one of the founders of CPI. He has served as
Chairman of the Board and Chief Executive Officer of CPI since its inception in
January 2003. From April 2001 until January 2003, Mr. Schissler was the
President and Chief Executive Officer of Rainmakers International, Inc., an
advertising agency which he founded. From 1994 through March 2001, Mr. Schissler
held various management sales positions at TMP Worldwide, Inc., a personnel
staffing company.

         Stephanie A. Schissler is one of the founders of CPI. She has served as
President and Chief Operating Officer of CPI since its inception in January
2003. From September 2001 until December 2002, Mrs. Schissler was an account
executive with Paychex Business Solutions, Inc., a payroll services company.
From April 2001 through August 2001, she was a director of business development
at Mills & Murphy Software Systems, Inc., a software developer and reseller.
From February 1996 through December 2000, she held various sales and managerial
positions with TMP Worldwide, Inc.

         Sandra D. Smith became the Chief Financial Officer as of June 1, 2004.
From December 2002 until May 2004, she served as the Accounting System
Administrator for Bisk Education, Inc.. From September 2000 to December 2002,
she was a Financial Systems Consultant for Mills & Murphy Software Systems, Inc.
From August 1998 to August 2000, she held an accounting management position and
was a member of the Mergers and Acquisitions team for TMP Worldwide, Inc.

         Noah J. Anderson became the Chief Technology Officer as of June 1,
2004. From September 2003 to May 2004, Mr. Anderson was the President and
founder of Assent Solutions an IT consulting firm. From March 2001 to August
2003 he was Director of Technology for Mills & Murphy Software Systems, Inc.
From April 1998 to February 2001 he held title of Sr. Network Engineer for TMP
Worldwide, Inc.

         Joseph R. Vicente is one of the founders of The Empower Network, Inc.,
a personnel staffing consulting company. Since September 2003, he has served as
President and Chief Operating Officer of The Empower Network, Inc. From July
2002 through August 2003, Mr. Vicente served as a Vice President of Workplace
Technology Ventures, Inc., a software developer. From 1993 through March 2002,
Mr. Vicente held various management sales positions at TMP Worldwide, Inc.

                                       26
<PAGE>

         Stephen Weir is one of the founders of Gecko Media, Inc., a website
development company. Since 2002, he has served as President of Gecko Media, Inc.
Mr. Weir was also a founder of Global Interactive Network Systems, Inc., a
network consulting company. From 1996 to 2002, Mr. Weir served as President of
Global Interactive Network Systems, Inc.

(b)      Significant Employees

         The names, ages and positions of each employee who is not an executive
officer but is expected to make a significant contribution to the business are
listed below. A summary of their respective business experience during the past
five years follows.

NAME                 AGE    POSITION
-----------------  -------  -------------------------------------
Laura Fitzpatrick    37     President, CBA Professional Services, Inc. and
                            Vice President of Sales, Cord Partners, Inc.

         Laura Fitzpatrick has served as Vice President of Sales for CPI since
its formation. As of November 2004, Ms. Fitzpatrick became the President of CBA
Professional Services, Inc. From May 2002 until January 2003, Ms. Fitzpatrick
was Senior Vice President of the San Francisco, California office of Rainmakers
International, Inc.. From February 1995 to April 2002, she held various
management sales positions at TMP Worldwide, Inc..

TERMS OF OFFICE

         The Company's Amended and Restated Articles of Incorporation provide
for three classes of directors, and further provide that directors elected to
succeed those directors whose terms expire will be elected for a term of office
to expire at the third succeeding annual meeting of shareholders after their
election. Subject to the rights of the holders of any series of Preferred Stock
then outstanding, newly created directorships resulting from any increase in the
authorized number of directors or any vacancies in the Board of Directors
resulting from death, resignation, retirement, disqualification, removal from
office or other cause will be filled by a majority vote of the directors then in
office. The directors so chosen will hold office for a term expiring at the
annual meeting of shareholders at which the term of the class to which they have
been elected expires. No decrease in the number of directors constituting the
Board of Directors will shorten the term of any incumbent director. All
directors hold office, subject to such staggered board provisions, until the
next annual meeting of shareholders of the Company and until their successors
are elected and qualified.

         Officers are normally appointed annually by the Board of Directors at a
meeting of the directors immediately following the annual meeting of
shareholders. Officers hold office until the first meeting of directors
following the next annual meeting of shareholders and until their successors are
elected and qualified, subject to earlier removal by the Board of Directors.

                                       27
<PAGE>

FAMILY RELATIONSHIPS

         Matthew L. Schissler and Stephanie A. Schissler are married. There are
no other family relationships among the directors or executive officers of the
Company.

INVOLVEMENT IN CERTAIN LEGAL PROCEEDINGS

         None of our officers, directors, promoters or control persons have been
involved in the past five years in any of the following:

         (1) any bankruptcy petition filed by or against any business of which
such person was a general partner or executive officer either at the time of the
bankruptcy or within two years prior to that time;

         (2) any conviction in a criminal proceeding or being subject to a
pending criminal proceeding (excluding traffic violations and other minor
offenses);

         (3) Being subject to any order, judgment or decree, not subsequently
reversed, suspended or vacated, or any court of competent jurisdiction,
permanently or temporarily enjoining, barring, suspending or otherwise limiting
his involvement in any type of business, securities or banking activities; or

         (4) Being found by a court of competent jurisdiction (in a civil
action), the Commission or the Commodity Futures Trading Commission to have
violated a federal or state securities or commodities law, and the judgment has
not been reversed, suspended, or vacated.

PART 10. EXECUTIVE COMPENSATION
         ----------------------

         The following table presents compensation earned by our executive
officers for the year ended December 31, 2004.

<TABLE>
<CAPTION>
                                                                                              LONG-TERM COMPENSATION
                                                                                              ----------------------
                                            ANNUAL COMPENSATION                               AWARDS          PAYOUTS
                                            -------------------                               ------------------------
                                                                               RESTRICTED     SECURITIES      LTIP       ALL OTHER
                                                    BONUS    OTHER ANNUAL   STOCK AWARD(S)    UNDERLYING      PAYOUTS   COMPENSATION
NAME AND PRINCIPAL POSITION        YEAR  SALARY ($)  ($)   COMPENSATION ($)      ($)       OPTIONS/SARS (#)     ($)          ($)
                                   ----  ---------  -----  ---------------- -------------- ----------------   -------   ------------
<S>                                <C>   <C>          <C>         <C>             <C>         <C>                <C>          <C>
Matthew L. Schissler               2004  125,000(1)   0           0               0           500,000            0            0
  Chairman of the Board and
  Chief Executive Officer
Stephanie A. Schissler             2004  125,000(2)   0           0               0           500,000            0            0
  Chief Operating Officer and
  President of Cord Partners, Inc.
</TABLE>

                                       28
<PAGE>

NOTES TO TABLE:

         (1) $32,586 has been deferred at the election of the named officer.

         (2) $33,502 has been deferred at the election of the named officer.

The following table sets forth information concerning individual grants of stock
options in 2004 to the Named Executive Officers:

                    OPTION/SAR GRANTS IN LAST FISCAL YEAR (1)
<TABLE>
<CAPTION>

                           NUMBER OF SECURITIES   % TOTAL OPTIONS/SARS     EXERCISE
                         UNDERLYING OPTIONS/SARS  GRANTED TO EMPLOYEES      OR BASE          EXPIRATION
       NAME                GRANTED (#) (2)         IN FISCAL YEAR (3)   PRICE ($/SH) (4)      DATE (5)
----------------------   -----------------------  --------------------  ----------------     ----------
<S>                             <C>                        <C>                <C>             <C>  <C>
Matthew L. Schissler            500,000                    33%                0.25            4/28/2014
Stephanie A. Schissler          500,000                    33%                0.25            4/28/2014
Laura Fitzpatrick               500,000                    33%                0.25            4/28/2014
</TABLE>

Notes to Table:

         (1) The date of the grant of the Options was April 29, 2004.

         (2) The options vest at 25% per year over four years on the anniversary
         of the grant date.

         (3) The total number of options granted to our employees during 2004
         was 1,500,000.

         (4) The exercise price of the Options is $.25 per share of Common
         Stock.

         (5) In no event may the Options be exercised, in whole or in part,
         after April 28, 2014.

AGGREGATED OPTION/SAR EXERCISES IN LAST FISCAL YEAR AND FY-END OPTION/SAR VALUES

         As of December 31, 2004, all Options were unexercised as the Company's
stock was not publicly trading. The Company's stock began publicly trading on
January 28, 2005.

LONG-TERM INCENTIVE PLANS - AWARDS IN LAST FISCAL YEAR

         As of December 31, 2004, the Company had not yet implemented an
official Long-Term Incentive Plan for the officers of the Company.

COMPENSATION OF DIRECTORS

         We have not yet implemented any standard arrangements for the
compensation of directors of the Company. In April 2004, as recognition of their
service, each of the Company's two non-management directors, Joseph R. Vicente
and Stephen Weir, have each been granted options to purchase 50,000 shares of
our common stock at an exercise price of $0.25 per share. Such options may be
exercised at any time after April 28, 2005. In addition, we reimburse Messrs.
Vicente and Weir for their out-of-pocket expenses necessary to attend meetings
of the Board of Directors.

EMPLOYMENT AGREEMENTS

         We have entered into five year employment agreements with our two
executive officers, Matthew L. Schissler and Stephanie A. Schissler. Pursuant to
our employment agreement with Mr. Schissler, Mr. Schissler serves as Chairman of
the Board and Chief Executive Officer of the Company at an annual salary of

                                       29
<PAGE>

$125,000 through December 31, 2004. Mr. Schissler's annual salary increases to
$150,000 as of January 1, 2005 and to $175,000 as of January 1, 2006. His salary
is thereafter adjusted in accordance with changes in the cost of living index.
Mr. Schissler is entitled to receive performance bonuses as may from time to
time be determined by the Board of Directors and certain fringe benefits. Mr.
Schissler is subject to non-competition and confidentiality requirements.

         Pursuant to our employment agreement with Stephanie A. Schissler, Mrs.
Schissler serves as President and Chief Operating Officer of the Company at an
annual salary of $125,000 through December 31, 2004. Mrs. Schissler's annual
salary increases to $150,000 as of January 1, 2005 and to $175,000 as of January
1, 2006. Her salary is thereafter adjusted in accordance with changes in the
cost of living index. Mrs. Schissler is entitled to receive performance bonuses
as may from time to time be determined by the Board of Directors and certain
fringe benefits. Mrs. Schissler is subject to non-competition and
confidentiality requirements.

         The Company has entered into a one-year employment agreement with the
vice president of the Company ("VP"). Pursuant to the agreement, the VP receives
an annual salary of $80,000 through April 2005.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
         ------------------------------------------------------------------
         RELATED STOCKHOLDER MATTERS
         ---------------------------

         The following information relates to those persons who are the
beneficial owners of five percent or more of our outstanding shares of common
stock:

NAME AND ADDRESS OF          AMOUNT AND NATURE OF         PERCENT
BENEFICIAL OWNER (1)     BENEFICIAL OWNERSHIP (2)(3)    OF CLASS (4)
----------------------   ---------------------------    ------------
Matthew L. Schissler            11,706,000                  40.0%

Stephanie A. Schissler           8,050,000                  27.5%


(1)      The address for each of the persons listed above is c/o CBA, 9000 W.
         Sunset Boulevard, Suite 400, West Hollywood, CA 90069.

(2)      These shares are directly owned by each listed shareholder.

(3)      After giving effect to a two for one stock split effected as a stock
         dividend effective as of April 2, 2004.

(4)      The percentage is based upon 29,270,600 shares of issued and
         outstanding common stock and immediately exercisable warrants to
         purchase 1,000,000 shares of common stock as of March 24, 2005. In
         no event may the Options be exercised, in whole or in part, after April
         28, 2014.

         The following information relates to the shares of common stock
beneficially owned by each of our directors and executive officers and all of
our directors and executive officers as a group:

                                       30
<PAGE>

NAME AND ADDRESS OF                  AMOUNT AND NATURE OF         PERCENT
BENEFICIAL OWNER (1)             BENEFICIAL OWNERSHIP (2)(3)    OF CLASS (4)
----------------------          ---------------------------    ------------
Matthew L. Schissler                      11,706,000               40.0

Stephanie A. Schissler                     8,050,000               27.5

Joseph R. Vicente                                  0                  0

Stephen Weir                                  20,000                 (5)

All directors and executive
officers as a group (4 persons)           19,776,000               67.5


(1)      The address for each of the persons listed above is c/o CBA, 9000 W.
         Sunset Boulevard, Suite 400, West Hollywood, CA 90069.

(2)      These shares are directly owned by each listed shareholder.

(3)      After giving effect to a two for one stock split effected as a stock
         dividend effective as of April 2, 2004.

(4)      The percentage is based upon 29,270,600 shares of issued and
         outstanding common stock and immediately exercisable warrants to
         purchase 1,000,000 shares of common stock as of March 24, 2005. In
         no event may the Options be exercised, in whole or in part, after April
         28, 2014.

(5)      Less than one percent.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
         ----------------------------------------------

         During the past two years, the Company has entered into two
transactions with a value in excess of $60,000 with an officer, director or
beneficial owner of 5% or more of our common stock, or with a member of the
immediate family of any of the foregoing named persons or entities, as follows:

         On January 17, 2005, our wholly-owned subsidiary, CBA Professional
Services, Inc. borrowed $100,000 from Joseph R. Vicente, a director of our
company, on an unsecured basis. CBAPS guaranteed the loan. The loan is for a
period of one year and bears interest at 6% per annum. Interest is payable on a
monthly basis.

         In March of 2004, CPI became a party to a Web Development and
Maintenance Agreement with Gecko Media, Inc. Stephen Weir, a director of the
Company, is a founder, principal shareholder, director and officer of Gecko
Media, Inc. Pursuant to the Web Development and Maintenance Agreement, we pay to
Gecko Media, Inc. the amount of $5,000 per month for March through May 2004, and

                                       31
<PAGE>

the amount of $10,000 per month for June 2004 through March 2006, for
development, maintenance and hosting of our website. In addition, we have
granted to Gecko Media, Inc. options to purchase 150,000 shares of our common
stock at $.25 per share. If Gecko Media, Inc. performs its obligations under the
Web Development and Maintenance Agreement, then in March 2005, we will be
obligated to issue to Gecko Media, Inc. options to purchase an additional
150,000 shares of our common stock at $1.00 per share.

Item 13. Exhibits and Reports on Form 8-K
         --------------------------------

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

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

Exhibit
Number   Description
-------  -----------

3.0      Amended and Restated Articles of Incorporation of Cord Blood America,
         Inc. (1)

3.1      Amended and Restated Bylaws of Cord Blood America, Inc. (1)

2.0      Form of Common Stock Share Certificate of Cord Blood America, Inc. (1)

10.0     Patent License Agreement dated as of January 1, 2004 between PharmaStem
         Therapeutics, Inc. and Cord Partners, Inc. (2)

10.1     Service Agreement dated as of February 15, 2004 by and between Bergen
         Community Regional Blood Center and Cord Partners, Inc. (2)

10.2     Web Development and Maintenance Agreement dated March 18, 2004 by and
         between Gecko Media, Inc. and Cord Partners, Inc. (1)

10.3     Employment Agreement dated April 29, 2004 by and between Cord Blood
         America, Inc. and Matthew L. Schissler (1)

10.4     Employment Agreement dated April 29, 2004 by and between Cord Blood
         America, Inc. and Stephanie A. Schissler (1)

10.5     Stock Option Agreement dated April 29, 2004 by and between Cord Blood
         America, Inc. and Matthew L. Schissler (1)

10.6     Stock Option Agreement dated April 29, 2004 by and between Cord Blood
         America, Inc. and Stephanie A. Schissler (1)

10.7     Stock Option Agreement dated April 29, 2004 by and between Cord Blood
         America, Inc. and Joseph R. Vicente (1)

                                       32
<PAGE>

10.8     Stock Option Agreement dated April 29, 2004 by and between Cord Blood
         America, Inc. and Stephen Weir (1)

10.9     Stock Option Agreement dated April 29, 2004 by and between Cord Blood
         America, Inc. and Gecko Media, Inc. (1)

10.10    License Agreement by and between Cord Partners, Inc. and Premier Office
         Centers, LLC (2)

10.11    Purchase and Sale of Future Receivables Agreement between AdvanceMe,
         Inc. and Cord Partners, Inc. (2)

10.12    Promissory Note dated August 12, 2004 made by Cord Blood America, Inc.
         to the order of Thomas R. Walkey (2)

10.13    Loan Agreement Dated September 17, 2004 by and between Cord Blood
         America, Inc. and Thomas R. Walkey (3)

10.14    Lease Agreement by and between Cord Partners, Inc. and Nine Thousand
         Sunset, LLC (2)

10.15    Promissory Note dated January 17, 2005 made by CBA Professional
         Services, Inc. to the order of Joseph R. Vicente (4)

10.16    Exchange Agreement dated February 28, 2005 by and between Cord Blood
         America, Inc. and Career Channel, Inc. (5)

10.17    Standby Equity Distribution Agreement dated March 22, 2004 between
         Cornell Capital Partners, LP and Cord Blood America, Inc. (9)

10.18    Placement Agent Agreement dated March 22, 2005 between Newbridge
         Securities Corporation, Cornell Capital Partners, LP and Cord Blood
         America, Inc. (9)

10.19    Registration Rights Agreement dated March 22, 2004 between Cornell
         Capital Partners, LP and Cord Blood America, Inc. (9)

10.20    Escrow Agreement dated March 22, 2004 between Cord Blood America, Inc.,
         Cornell Capital Partners, LP and David Gonzalez, Esq. (9)

21.0     Subsidiaries of the small business issuer

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

                                       33
<PAGE>

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

99.1     Press Release dated March 2, 2005 (6)

99.2     Press Release dated March 10, 2005 (7)

99.3     Press Release dated March 15, 2005 (8)

99.4     Press Release dated March 28, 2005 (9)


(1)      Filed as an exhibit to Registration Statement on Form 10-SB filed on
         May 6, 2004.

(2)      Filed as an exhibit to Amendment Number 1 to Registration Statement on
         Form 10-SB filed on August 23, 2004.

(3)      Filed as an exhibit to Amendment Number 2 to Registration Statement on
         Form 10-SB filed on October 6, 2004.

(4)      Filed as an exhibit to Current Report on Form 8-K filed on January 17,
         2005.

(5)      Filed as an exhibit to Current Report on Form 8-K filed on March 1,
         2005.

(6)      Filed as an exhibit to Current Report on Form 8-K filed on March 2,
         2005.

(7)      Filed as an exhibit to Current Report on Form 8-K filed on March 11,
         2005.

(8)      Filed as an exhibit to Current Report on Form 8-K filed on March 15,
         2005.

(9)      Filed as an exhibit to Current Report on Form 8-K filed on March 28,
         2005.

         (b)      Reports on Form 8-K.

         Current Report on Form 8-K, dated October 22, 2004, reporting Item 2,
relating to the execution of the third loan agreement with an unaffiliated
party.

ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES
          --------------------------------------

         The following table sets forth the aggregate fees billed to us by our
principal accountant, Tedder, James, Worden and Associates, P.A., for the
periods indicated.

                                       34
<PAGE>

                                              FOR THE YEAR ENDED
                                                  DECEMBER 31,
                                         --------------------------------
                                            2003                  2004
                                         ----------            ----------
Audit Fees                               $   29,400            $   40,000
Audit-Related Fees                       $   13,144            $        0
Tax Fees                                 $        0            $        0
All Other Fees                           $        0            $        0
                                         ----------            ----------
   Total audit and non-audit fees        $   42,544            $   40,000
                                         ==========            ==========

                                       35
<PAGE>

                                   SIGNATURES

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

                                     CORD BLOOD AMERICA, INC.




Date:    April 5, 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)

         In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated.

NAME                                   TITLE                         DATE
------------------------     -------------------------          --------------

/s/ Matthew L. Schissler     Chairman of the Board and          April 5, 2005
------------------------     Chief Executive Officer
Matthew L. Schissler

/s/ Joseph Vicente           Director                           April 5, 2005
------------------
Joseph Vicente

/s/ Stephen Weir             Director                           April 5, 2005
----------------
Stephen Weir

                                       36

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                        CONSOLIDATED FINANCIAL STATEMENTS

                           December 31, 2004 and 2003


                                Table of Contents
                                -----------------

Report of Independent Registered Certified Public Accounting Firm ............1


Financial Statements:

       Consolidated Balance Sheet ............................................2

       Consolidated Statements of Operations .................................3

       Consolidated Statements of Changes in Capital Deficit .................4

       Consolidated Statements of Cash Flows .................................5


Notes to Consolidated Financial Statements ...................................7


<PAGE>

        REPORT OF INDEPENDENT REGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM
        -----------------------------------------------------------------

To the Board of Directors and Stockholders of
     Cord Blood America, Inc. and Subsidiaries:

We have audited the accompanying consolidated balance sheet of Cord Blood
America, Inc. and Subsidiaries as of December 31, 2004, and the related
consolidated statements of operations, changes in capital deficit, and cash
flows for the years ended December 31, 2004 and 2003. These consolidated
financial statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of Cord Blood America,
Inc. and Subsidiaries as of December 31, 2004, and the results of their
operations and their cash flows for the years ended December 31, 2004 and 2003,
in conformity with U.S. generally accepted accounting principles.

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As Discussed in Note 2 to the
financial statements, the Company has suffered recurring losses from operations,
has a working capital deficit, and has suffered negative cash flows from
operating activities. This raises substantial doubt about the Company's ability
to continue as a going concern. Management's plans in regards to these mattes
are also described in Note 2. The financial statements do no include any
adjustments that might result from the outcome of this uncertainty.

/s/ Tedder, James, Worden and Associates, P.A.

Orlando, Florida
March 18, 2005, except for Note 15 as to which
the date is March 24, 2005.

<PAGE>

                   CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEET

                               December 31, 2004

                                     ASSETS
                                     ------
Current assets:
     Cash                                                           $   112,673
     Certificates of deposit                                             75,000
     Accounts receivable, net of allowance for
         doubtful accounts of $13,516                                    94,262
                                                                    -----------
             Total current assets                                       281,935

Property and equipment, net                                              16,227
Deposit                                                                  20,000
Other assets                                                              2,062
                                                                    -----------
             Total assets                                           $   320,224
                                                                    ===========

                         LIABILITIES AND CAPITAL DEFICIT
                         -------------------------------
Current liabilities:
     Accounts payable                                               $   361,161
     Accrued expenses                                                   155,553
     Deferred revenue                                                   135,177
     Due to related party                                                15,215
     Capital lease obligations, current portion                           3,630
     Notes payable                                                      936,975
                                                                    -----------
             Total current liabilities                                1,607,711

Capital lease obligations, net of current portion                         4,159
                                                                    -----------
             Total liabilities                                        1,611,870

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, 25,429,600 shares issued and outstanding             2,543
     Additional paid-in capital                                         398,939
     Accumulated deficit                                             (1,693,128)
                                                                    -----------
             Total capital deficit                                   (1,291,646)
                                                                    -----------
             Total liabilities and capital deficit                  $   320,224
                                                                    ===========

See the accompanying notes to consolidated financial statements.

                                       2
<PAGE>

                   CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF OPERATIONS

                 For the years ended December 31, 2004 and 2003

                                                     2004              2003
                                                 ------------      ------------
Revenues                                         $    751,850           281,175

Cost of revenues                                     (597,348)         (198,770)
                                                 ------------      ------------
         Gross profit                                 154,502            82,405

Selling, general and administrative expenses        1,745,279           128,243
                                                 ------------      ------------
         Loss from operations                      (1,590,777)          (45,838)

Interest expense                                      (56,513)               --
                                                 ------------      ------------
         Net loss before income taxes              (1,647,290)          (45,838)

Income taxes                                               --                --
                                                 ------------      ------------
         Net loss                                $ (1,647,290)          (45,838)
                                                 ============      ============
Basic and diluted loss per share                 $      (0.07)            (2.78)
                                                 ============      ============
Weighted average common shares outstanding         24,933,182            16,500
                                                 ============      ============





See the accompanying notes to consolidated financial statements.

                                       3
<PAGE>

                   CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

             CONSOLIDATED STATEMENTS OF CHANGES IN CAPITAL DEFICIT

                 For the years ended December 31, 2004 and 2003

<TABLE>
<CAPTION>
                                                       COMMON STOCK              ADDITIONAL
                                               ----------------------------       PAID-IN       ACCUMULATED
                                                 SHARES            AMOUNT         CAPITAL         DEFICIT           TOTAL
                                               ----------        ----------      ----------      ----------      ----------
<S>                                                <C>           <C>              <C>            <C>             <C>
Shares issued at inception                         16,500        $       83              --              --              83

Contributions                                          --                --           5,354              --           5,354

Net loss                                               --                --              --         (45,838)        (45,838)
                                               ----------        ----------      ----------      ----------      ----------

Balances at December 31, 2003                      16,500                83           5,354         (45,838)        (40,401)

Sale of common stock                                2,290           185,000              --              --         185,000

Stock issued for services                           2,000            10,000              --              --          10,000

Recapitalization of Cord Partners, Inc.        24,996,410          (192,581)        192,581              --              --

Stock issued for services                          20,000                 2           4,998              --           5,000

Sale of common stock                              392,400                39          98,061              --          98,100

Issuance of stock options for services                 --                --          13,912              --          13,912

Issuance of debt with detachable warrants              --                --          84,033              --          84,033

Net loss                                               --                --              --      (1,647,290)     (1,647,290)
                                               ----------        ----------      ----------      ----------      ----------
Balances at December 31, 2004                  25,429,600        $    2,543         398,939      (1,693,128)     (1,291,646)
                                               ==========        ==========      ==========      ==========      ==========
</TABLE>

See the accompanying notes to consolidated financial statements.

                                       4
<PAGE>

                   CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                     CONSOLIDATED STATEMENTS OF CASH FLOWS

                 For the years ended December 31, 2004 and 2003

<TABLE>
<CAPTION>
                                                                  2004             2003
                                                              -----------      -----------
<S>                                                           <C>                  <C>
Cash flows from operating activities:
    Net loss                                                  $(1,647,290)         (45,838)
    Adjustments to reconcile net loss to net cash
      used in operating activities:
         Issuance of stock and stock options for services          28,912               --
         Provision for uncollectible accounts                      11,605            1,910
         Depreciation and amortization                             22,414               --
         Changes in operating assets and liabilities:
           Accounts receivable                                    (95,812)         (11,965)
           Deposits                                               (20,000)              --
           Other assets                                            (2,062)              --
           Accounts payable                                       325,040           36,121
           Accrued expenses                                       155,553               --
           Deferred revenue                                       115,643           19,534
           Due to related party                                    15,215               --
                                                              -----------      -----------
             Net cash used in operating activities             (1,090,782)            (238)

Cash flows from investing activities:
    Purchase of property and equipment                             (9,658)              --
    Purchase of certificates of deposit                           (75,000)              --
                                                              -----------      -----------
             Net cash used in investing activities                (84,658)              --

Cash flows from financing activities:
    Proceeds from the issuance of notes payable                 1,021,000               --
    Payments of notes payable                                     (21,000)              --
    Payments on capital lease obligations                            (186)              --
    Proceeds from advance from officer                                 --            5,000
    Payments on advance from officer                               (5,000)              --
    Proceeds from issuance of common stock                        283,100               83
    Contributions                                                      --            5,354
                                                              -----------      -----------
             Net cash provided by financing activities          1,277,914           10,437
                                                              -----------      -----------
             Net increase in cash                                 102,474           10,199

Cash, at beginning of year                                         10,199               --
                                                              -----------      -----------
Cash, at end of year                                          $   112,673           10,199
                                                              ===========      ===========
</TABLE>

See the accompanying notes to consolidated financial statements.

                                       5
<PAGE>

                   CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF CASH FLOWS, CONTINUED

                 For the years ended December 31, 2004 and 2003

                                                            2004        2003
                                                          --------     ------

Supplemental disclosures of cash flow information:
    Cash paid for interest                                $  8,005         --
                                                          ========     ======

    Cash paid for income taxes                            $     --         --
                                                          ========     ======

Supplemental disclosures of non-cash investing and
    financing activities:
      Discount on notes payable issued
         with detachable warrants                         $ 84,033         --
                                                          ========     ======

      Acquisition of computer equipment under capital
         lease obligations                                $  7,975         --
                                                          ========     ======

See the accompanying notes to consolidated financial statements.

                                       6
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                           December 31, 2004 and 2003

(1)    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

       (a)    ORGANIZATION AND DESCRIPTION OF BUSINESS

              Cord Blood America, Inc., formerly D&A Lending, Inc., (the
              "Company") was incorporated in the State of Florida on October 12,
              1999. The Company is in the business of collecting, processing,
              and cryogenically storing umbilical cord blood. The Company's
              headquarters are located in Los Angeles, California.

              Effective March 31, 2004, the Company entered into an Agreement
              for the Exchange of Common Stock (the "Agreement") with Cord
              Partners, Inc. ("Cord") where the Company issued 20,790,000
              shares, for all of the outstanding stock of Cord. As a result of
              the Agreement, the shareholders of Cord owned approximately 83% of
              the outstanding shares of the Company, and Cord has been deemed
              the accounting acquirer (a reverse acquisition in which Cord is
              considered the acquirer for accounting purposes). Accordingly, the
              historical financial information presented for the periods prior
              to March 31, 2004 is that of Cord, which was incorporated on
              January 1, 2003. The results of operations of the Company have
              been included with the results of operations of Cord in the
              accompanying consolidated financial statements from the date of
              acquisition. As a result of this reverse acquisition, there were
              no assets acquired or liabilities assumed.

              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.

       (b)    BASIS OF CONSOLIDATION

              The consolidated financial statements include the accounts of the
              Company and its wholly owned subsidiaries, Cord, CBA Professional
              Services, Inc. ("Services"), and CBA Properties, Inc.
              ("Properties"). Significant inter-company balances and
              transactions have been eliminated upon consolidation.

       (c)    CERTIFICATES OF DEPOSIT

              The company holds certificates of deposit with original maturities
              of nine months. The certificates of deposit mature in September
              2005.

       (d)    ACCOUNTS RECEIVABLE

              Accounts receivable consist of the amounts due for the processing
              and storage of umbilical cord blood. The allowance for doubtful
              accounts is estimated based upon historical experience. The
              allowance is reviewed periodically and adjusted for accounts
              deemed uncollectible by management.

                                       7
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

       (e)    PROPERTY AND EQUIPMENT

              Property and equipment are stated at cost less accumulated
              depreciation. Depreciation is computed on the straight-line method
              over the estimated useful lives of the assets. Routine maintenance
              and repairs are charged to expense as incurred while major
              replacement and improvements are capitalized as additions to the
              related assets. Retirements, sales, and disposals of assets are
              recorded by removing the cost and accumulated depreciation from
              the related asset and accumulated depreciation accounts with any
              gain or loss credited or charged to income upon disposition.

       (f)    DEFERRED REVENUE

              Deferred revenue consists of payments for enrollment in the
              program and processing and storage 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.

       (g)    REVENUE RECOGNITION

              The Company provides a combination of products and services to
              customers. This combination arrangement is evaluated under
              Emerging Issues Task Force Issues ("EITF") 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. The Company elected
              early adoption of EITF 00-21.

              The Company recognizes revenue from processing fees upon the
              completion of processing and storage fees ratably over the
              contractual storage period. Enrollment fees are deferred and
              recognized once the processing of the umbilical cord blood is
              complete.

       (h)    COST OF SERVICES

              Costs 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 labs processing fees and royalties. The
              Company expenses these costs in the period incurred and do not
              defer any costs of sales.

                                       8
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

       (i)    ADVERTISING

              Advertising costs are expensed when incurred. Advertising expense
              totaled approximately $600,000 and $69,000 for the years ended
              December 31, 2004 and 2003.

       (j)    INCOME TAXES

              The Company follows the asset and liability method of accounting
              for income taxes. Deferred tax assets and liabilities are
              recognized for the estimated future tax consequences attributable
              to differences between the financial statement carrying amounts of
              existing assets and liabilities and their respective tax bases.
              Deferred tax assets and liabilities are measured using enacted tax
              rates expected to apply to taxable income in the years in which
              those temporary differences are expected to be recovered or
              settled. The effect on deferred tax assets and liabilities of a
              change in tax rates is recognized as income in the period that
              included the enactment date.


                                       9
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

       (k)    ACCOUNTING FOR STOCK COMPENSATION PLAN

              The Company 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 for the years ended December 31:

<TABLE>
<CAPTION>
                                                                        2004          2003
                                                                    -----------     ---------
<S>                                                                 <C>               <C>
              Net loss, as reported                                 $(1,647,290)      (45,838)
              Add: stock-based employee compensation
                expense included in reported net loss
                net of related tax effects                                   --            --
              Deduct: total stock-based employee compensation
                expense determined under the fair value method
                for all awards, net of related tax effects              (27,823)           --
                                                                    -----------     ---------
                       Pro forma net loss                           $(1,675,113)      (45,838)
                                                                    ===========     =========

              Basic and diluted loss per common share, as
                reported                                            $     (0.07)        (2.78)
                                                                    ===========     =========

              Basic and diluted loss per common share, pro forma    $     (0.07)        (2.78)
                                                                    ===========     =========
</TABLE>

       (l)    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 24,933,182 and 16,500 for the years ended December
              31, 2004 and 2003, respectively. The Company has 1,750,000 and -0-
              outstanding options to acquire common stock at December 31, 2004
              and 2003, respectively, which are not included in the computation
              of net loss per common share because the effects of inclusion are
              anti-dilutive.

                                       10
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(1)    SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES, CONTINUED

       (m)    CONCENTRATIONS OF RISK

              Relationships and agreements which potentially expose the Company
              to concentrations of credit risk consist of the Company's use of
              one source for the processing and storage of all umbilical cord
              blood, one source for its collection kits, and one source for the
              development and maintenance of a website. The Company believes
              alternative sources are available for each of these
              concentrations.

       (n)    USE OF ESTIMATES

              The preparation of financial statements in conformity with
              accounting principles generally accepted in the United States of
              America requires management to make estimates and assumptions that
              affect the reported amounts of assets and liabilities and
              disclosure of contingent assets and liabilities at the dates of
              the financial statements and the reported amounts of revenues and
              expenses during the reporting periods. Actual results could differ
              from those estimates.

       (o)    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 June 15, 2005. The
              impact of adopting FASB Statement No. 123R will only be known when
              new options are issued in the periods after the effective date.

(2)    MANAGEMENT'S PLANS AND INTENTIONS

       The Company's consolidated financial statements have been prepared
       assuming the Company will continue as a going concern. The Company has
       experienced recurring net losses from operations, which losses have
       caused an accumulated deficit of approximately $1,693,000 as of December
       31, 2004. In addition, the Company has consumed cash in its operating
       activities of approximately $1,091,000 and has a working capital deficit
       of approximately $1,326,000 as of December 31, 2004. These factors, among
       others, raise substantial doubt about the Company'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
       and by issuing debt to fund its working capital needs. The Company is
       continuing to seek other sources of financing and attempting to increase
       revenues within its core business. In addition, the Company is exploring
       alternate ways of generating revenues through franchising its existing
       business model and acquiring other businesses intended to diversify its
       revenue streams. The ongoing execution of the Company's business plan is
       expected to result in operating losses for the foreseeable future. There
       are no assurances that the Company will be successful in achieving its
       goals.

                                       11
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(2)    MANAGEMENT'S PLANS AND INTENTIONS, CONTINUED

       In view of these conditions, the Company's ability to continue as a going
       concern is dependent upon its ability to obtain additional financing or
       capital sources, to meet its financing requirements, and ultimately to
       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 relating to the recoverability and classification of recorded
       assets, or the amounts and classification of liabilities that may be
       necessary in the event the Company cannot continue as a going concern.

(3)    PROPERTY AND EQUIPMENT

       Property and equipment consisted of the following at December 31, 2004:

                                                ESTIMATED
                                                USEFUL LIVEs      2004
                                                ------------    --------
              Furniture and fixtures             5 years        $  5,367
              Computer equipment                 3 years          12,266
                                                                --------
                                                                  17,633
              Less accumulated depreciation                       (1,406)
                                                                --------
                                                                $ 16,227
                                                                ========

       For the year ended December 31, 2004 depreciation expenses totaled
       $1,406. There was no depreciation expense for the year ended December 31,
       2003.

(4)    ACCRUED EXPENSES

       The components of accrued expenses at December 31, 2004 are summarized as
       follows:

                                                  2004
                                                --------
              Accrued salaries and benefits     $117,230
              Accrued interest                    27,500
              Other                               10,823
                                                --------
                                                $155,553
                                                ========

                                       12
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(5)    CAPITAL LEASE OBLIGATIONS

       During 2004, the Company entered into capital leases for computer
       equipment. The capital leases expire at various dates in 2007. Assets
       under capital lease are capitalized using interest rates appropriate at
       the inception of the lease. At December 31, 2004, these leased assets are
       included in property and equipment as computer equipment amounting to
       $7,975.

       Accumulated amortization and amortization expense amounted to $620 as of
       and for the year ended December 31, 2004. Amortization expense is
       included as a component of depreciation expense.

       As of December 31, 2004, future minimum lease payments under capital
       lease obligations are as follows:

                     YEAR ENDED DECEMBER 31,
              -------------------------------------------------
                              2005                                  $ 3,630
                              2006                                    3,630
                              2007                                    3,120
                                                                    -------
              Total minimum lease payments                           10,380

              Less amounts representing interest                     (2,591)
                                                                    -------
                                                                      7,789
              Less current portion of capital lease obligations      (3,630)
                                                                    -------
                                                                    $ 4,159
                                                                    =======

(6)    NOTES PAYABLE

       In August 2004, the Company entered into the first of three unsecured
       promissory notes (the "First Note") for $500,000 bearing interest at 8%
       per annum. In September 2004, the Company entered into the second of
       three promissory notes (the "Second Note") for $250,000 bearing interest
       at 10% per annum to the same party. In October 2004, the company entered
       into the last of three promissory notes (the "Third Note") for $250,000
       bearing interest at 10% to the same party.

                                       13
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(6)    NOTES PAYABLE, CONTINUED

       The First Note requires monthly payments of interest and principal
       commencing in February 2005. The Second Note requires monthly payments of
       principal and interest commencing on the earlier of full payment of the
       First Note or February 2005. The Third Note requires monthly payments of
       principal and interest commencing on the earlier of full payment of the
       First Note and the Second Note or February 2005. Payments on all three
       notes are calculated as 5% of the Company's consolidated revenues
       determined in accordance with generally accepted accounting principles
       for the immediately preceding calendar month. Payments are applied to the
       First Note, until paid in full, then to the Second Note, until paid in
       full, and then to the Third Note. The entire principal of the First Note
       together with any and all unpaid interest accrued thereon, shall be
       finally due and payable on August 15, 2005. The entire principal of the
       Second Note together with any and all unpaid interest accrued thereon,
       shall be finally due and payable on September 15, 2005. The entire
       principal of the Third Note together with any and all unpaid interest
       accrued thereon, shall be finally due and payable on October 15, 2005.
       The principal amount of these promissory notes and any interest accrued
       thereon may be prepaid in whole or in part at any time prior to maturity
       without premium or penalty of any kind. There were no principal payments
       made on these notes during 2004.

       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.

       As of December 31, 2004, approximately $27,500 of interest has been
       incurred on these notes and is included in accrued expenses in the
       accompanying balance sheet.

(7)    COMMITMENTS AND CONTINGENCIES

       AGREEMENTS

       The Company is operating under an agreement with a not-for-profit company
       to 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.

                                       14
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(7)    COMMITMENTS AND CONTINGENCIES, CONTINUED

       AGREEMENTS, CONTINUED

       In March 2004, the Company 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 the Company 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 the year 2010. During the year ended
       December 31, 2004, the Company incurred approximately $121,800 in
       royalties relating to the Patent License Agreement of which approximately
       $48,600 is included in accounts payable at December 31, 2004.

       In February 2004, the Company entered into a Receivables Agreement with a
       financing company whereby, at the customer's discretion, the products and
       services purchased from the Company can be financed through an unrelated
       finance company. The Company paid a $500 origination fee in conjunction
       with executing the Receivables Agreement. During the year ended December
       31, 2004 the Company sold approximately $32,900 in receivables, of which
       approximately $4,600 is held for default by the financing company which
       is included in accounts receivable. The receivables will be released to
       the Company one year from the date the receivable is initially sold.
       During the year ended December 31, 2004, the Company incurred
       approximately $3,600 in discounts relating to the sale of these
       receivables.

       OPERATING LEASE

       In 2004, the Company entered into non-cancelable operating leases for
       office space and computer software which expire through October 2009.
       Commitments for minimum future rental payments, by year and in the
       aggregate, to be paid under the operating leases as of December 31, 2004,
       are as follows:

                     2005                 $  75,807
                     2006                    77,975
                     2007                    78,433
                     2008                    78,957
                     2009                    53,680
                                          ---------
                                          $ 364,852
                                          =========

       The total lease payments are recorded as rent expense on a straight-line
       basis over the lease periods, resulting in a deferred rent liability of
       approximately $4,400, which is included in accrued expenses in the
       accompanying balance sheet. Total lease expense for operating leases,
       including those with terms of less than one year, amounted to
       approximately $49,000 and $5,300 for the years ended December 31, 2004
       and 2003, respectively.

                                       15
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(7)    COMMITMENTS AND CONTINGENCIES, CONTINUED

       LITIGATION

       The Company is party to a legal action arising in the ordinary course of
       its business. While the results of this matter cannot be predicted with
       certainty, management believes that the final outcome of the action will
       not have a material adverse effect on the Company's financial position.

       EMPLOYMENT AGREEMENTS

       The Company has 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 an employment agreement, the CEO of the Company receives an annual
       salary of $125,000 through December 31, 2004. The annual salary increases
       to $150,000 as of January 1, 2005 and to $175,000 as of January 1, 2006.
       The annual salary is thereafter adjusted in accordance with changes in
       the cost of living index. The CEO is entitled to receive performance
       bonuses as may from time to time be determined by the Board of Directors
       and certain fringe benefits. The employment agreement is subject to
       non-competition and confidentiality requirements.

       Pursuant to an employment agreement, the COO of the Company receives an
       annual salary of $125,000 through December 31, 2004. The annual salary
       increases to $150,000 as of January 1, 2005 and to $175,000 as of January
       1, 2006. The annual salary is thereafter adjusted in accordance with
       changes in the cost of living index. The COO is entitled to receive
       performance bonuses as may from time to time be determined by the Board
       of Directors and certain fringe benefits. The employment agreement is
       subject to non-competition and confidentiality requirements. The Company
       has entered into a one-year employment agreement with the Vice President
       ("VP"). Pursuant to the agreement, the VP of the Company receives an
       annual salary of $80,000 through April 2005.

       The Company has entered into a one-year employment agreement with the
       vice president of the Company ("VP"). Pursuant to the agreement, the VP
       receives an annual salary of $80,000 through April 2005.

(8)    INCOME TAXES

       For the year ended December 31, 2004, the Company incurred no current or
       deferred income tax expense.

                                       16
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(8)    INCOME TAXES, CONTINUED

       The tax effects of temporary differences that give rise to a significant
       portion of the deferred tax assets and deferred tax liabilities as of
       December 31, 2004 were as follows:

            Deferred tax assets:
              Accrued officer compensation                      $  18,000
              Net operating loss carry forward                    487,000
              Allowance for bad debts                               5,000
              Debt issue costs                                     24,000
                                                                ---------

                       Gross deferred tax assets                  534,000

            Less valuation allowance                             (532,000)
                                                                ---------
                       Net deferred tax assets                      2,000

            Deferred tax liabilities:
              Property and equipment, principally due to
              differences in depreciation                          (2,000)
                                                                ---------
                       Net deferred tax                         $      --
                                                                =========

       At December 31, 2004, the Company had net operating loss carry forwards
       of approximately $1,222,000 for federal income tax purposes, which are
       available to offset future taxable income, if any, through 2024.

(9)    SALES CONTRACTS

       The Company has sales contracts totaling approximately $81,200 and
       $27,400 as of December 31, 2004 and 2003, respectively, relating to
       customers who have initiated a sale with the Company for which the
       Company has performed no services. In accordance with the Company'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.





                                       17

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(10)   RELATED PARTY TRANSACTIONS AND COMMITMENTS

       In January 2003, the Company 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 Cord Blood America, Inc. The Web Agreement
       stipulates the Company does not own the website; however, the Company
       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 3-year term and renews
       automatically for additional 3-year periods unless either party provides
       written notice at least 30 days prior to the end of the term.

       In March 2004, the Company 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 $.25
       per share followed by another 150,000 stock options to be issued one year
       later at an exercise price of $1.00 per share (see Note 11). The new Web
       Agreement expired in March 2005. The Company continues to operate under
       the terms of this new Web Agreement.

       During 2004 and 2003, the Company paid approximately $60,800 and $20,600,
       respectively, relating to both web development agreements. At December
       31, 2004, the Company owed approximately $15,200 relating to these web
       development agreements which is included in due to related party in the
       accompanying balance sheet.

       During 2003, an officer of the company contributed $5,354 to the Company
       to provide working capital.

       In December 2003, the Company received $5,000 as a short term,
       non-interest bearing advance from an officer of the Company. This advance
       was repaid during 2004.

(11)   STOCK OPTION AGREEMENTS

       During 2004, the Company entered into a series of stock option agreements
       with directors and certain employees of the Company. The agreements call
       for the issuance of a total of 1,600,000 options which vest over a 4-year
       period at an exercise price of $.25 per share.

       During 2004, the Company entered into a stock option agreement in
       connection with a Web Development Agreement (see Note 10). The agreement
       calls for the issuance of 150,000 options which vest over a 4-year period
       at an exercise price of $.25 per share. In connection with these options
       issued, the Company recognized an expense of approximately $13,900, which
       is included in the accompanying financial statements.

                                       18
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(11)   STOCK OPTION AGREEMENTS, CONTINUED

       The following table summarizes stock option activity for the year ended
       December 31, 2004. No stock options were outstanding during the year
       ended December 31, 2003.

                                                                    WEIGHTED
                                                                    AVERAGE
                                                   SHARES UNDER  EXERCISE PRICE
                                                      OPTION        PER SHARE
                                                    ---------       --------
            Outstanding at December 31, 2003               --       $     --
            Granted                                 1,750,000           0.25
            Exercised                                      --             --
            Expired/forfeited                              --             --
                                                    ---------       --------
            Outstanding at December 31, 2004        1,750,000       $   0.25
                                                    =========       ========

       The weighted average fair value at the date of grant for the options
       granted during the year ended December 31, 2004 was approximately $.09
       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                                  4.69%
            Expected life                                           10 years
            Dividend yield                                              0%


       The following table summarizes the stock options outstanding and
exercisable at December 31, 2004:
<TABLE>
<CAPTION>
                        OUTSTANDING                                            EXERCISABLE
---------------------------------------------------------------       -----------------------------
                                  WEIGHTED
                                  AVERAGE             WEIGHTED                            WEIGHTED
                                 REMAINING            AVERAGE                             AVERAGE
  EXERCISE       NUMBER OF      CONTRACTUAL           EXERCISE         NUMBER OF          EXERCISE
   PRICE          OPTIONS          LIFE                PRICE            OPTIONS            PRICE
-----------    ----------       ----------          -----------       -----------       -----------
<S>     <C>     <C>             <C>                 <C>               <C>               <C>
                                  9 years,
$      0.25     1,750,000         3 months          $      0.25                --       $      0.25
===========    ==========       ==========          ===========       ===========       ===========
</TABLE>


                                       19

<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(12)   PREFERRED STOCK

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

(13)   COMMON STOCK

       At inception, the Company had 50,000,000 shares of non-par common stock
       authorized.

       In January 2004, the Company issued 2,000 shares of common stock for
       professional services. The services were valued at $10,000.

       In March 2004, the Company sold 2,290 shares of common stock for
       $185,000.

       In March 2004, the board of directors of the Company amended their
       articles of incorporation to authorize 100,000,000 shares of $.0001 par
       value common stock.

       Effective March 31, 2004, the Company entered into an Agreement for the
       Exchange of Common Stock (the "Agreement") with Cord where the Company
       issued 20,790,000 shares, for all of the outstanding stock of Cord.

       In April 2004, the board of directors of the Company declared and paid a
       two for one stock split, affected as a stock dividend to its
       shareholders. Amounts in the accompanying financial statements have been
       retroactively changed to reflect this stock split.

       In April 2004, the Company issued 20,000 shares of common stock to former
       employees of Cord in connection with the termination of employment
       agreements. The stock was valued at $5,000, was charged to income in the
       three month period ended June 30, 2004 and is included in selling,
       general, and administrative expenses.

       In June 2004, the Company sold 280,000 shares of common stock through a
       private placement at $.25 per share for $70,000.

       In December 2004, the Company sold 112,400 shares of common stock through
       a private placement at $.25 per share for $28,100.


                                       20
<PAGE>
                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(14)   SEGMENT REPORTING

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

       The Company has one operating segment. 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 following table represents net
       revenues generated from our one operating segment for the years ended
       December 31, 2004 and 2003:

                                            2004            2003
                                          --------        --------
            Enrollment fees               $218,830          87,630
            Storage and other fees          32,508          11,490
            Processing fees                500,512         182,055
                                          --------        --------
                                          $751,850         281,175
                                          ========        ========

(15)   SUBSEQUENT EVENTS

       SALES OF EQUITY SECURITIES

       In January 2005, the company sold 185,000 shares of common stock through
       private placements. The shares were sold for $53,000.

       BUSINESS ACQUISITION

       In February 2005, the Company entered into a purchase and sale agreement
       (the "Agreement") to acquire 100% of the outstanding shares of Career
       Channel, Inc., also known as RainMakers, International ("RainMakers")
       through a share exchange. Because RainMakers and the Company were
       entities under common control this transaction will be accounted for in a
       manner similar to a pooling of interests. The Company issued 3,656,000
       shares of common stock for all of the outstanding shares of RainMakers.
       RainMakers is in the business of advertising, specializing in television
       and radio advertising companies. As a result of the acquisition, the
       company expects to position itself in front of more expectant families
       through RainMakers marketing channels.




                                       21
<PAGE>

                    CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS


(15)   SUBSEQUENT EVENTS, CONTINUED

       BUSINESS ACQUISITION, CONTINUED

       The following table summarizes the carrying values of the assets acquired
at the date of acquisition.

                            AT FEBRUARY 28, 2005                    (UNAUDITED)
            ---------------------------------------------------      ---------
           Current assets                                            $ 116,900
           Non-current assets                                            5,800
                                                                     ---------

                    Total assets                                     $ 122,700
                                                                     =========

           Current liabilities                                       $  28,500
           Non-current liabilities                                          --
                                                                     ---------

                    Total liabilities                                   28,500

           Stockholders' equity                                         94,200
                                                                     ---------

                    Total liabilities and stockholders' equity       $ 122,700
                                                                     =========

       LONG-TERM DEBT

       Subsequent to year-end, Services obtained a promissory note for $100,000
       from a director of the Company to fund the operations. The promissory
       note bears interest at 6% and is due in January 2006. The Company
       guaranteed the promissory note to the director. In March 2005, Services
       re-paid $95,000 of this promissory note.

       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.

       In March 2005, the Company entered into a Standby Equity Distribution
       Agreement (the "Equity Agreement") whereby the Company shall sell up to
       $5,000,000 of the Company's common stock to an investment group at the
       Company's discretion over a 24 month period. The Equity Agreement allows
       the Company to sell shares of common stock to the investor group in
       incremental advances not to exceed $250,000. The shares of common stock
       issued at each advance are calculated based on 98% of the lowest volume
       weighted average price of the Company's common stock for the 5 day period
       after the request for an advance was received. The investment company
       also receives a 5% fee for each advance. The Equity Agreement called for
       a $15,000 fee paid up front, plus issuance of shares of common stock
       equal to $250,000 based on the lowest volume weighted average price of
       the Company's common stock. Prior to any advances, as funded through the
       issuance of shares of common stock, the Company must file, and the
       Securities and Exchange Commission must declare effective a registration
       statement registering the resale of the Company's securities in
       accordance with the Equity Agreement.

                                       22