UNITED STATES SECURITIES AND EXCHANGE COMMISSION

WASHINGTON D. C. 20549

_______________



FORM 10KSB/A



(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, 2007.



[   ]  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

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CORD BLOOD AMERICA, INC.

(Name of small business issuer in its charter)



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|Florida                                                        | 65-1078768                          
|(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.)



501 Santa Monica Blvd., Suite 700
Santa Monica, California 90401

(Address of Principal Executive Offices and Zip Code)



310-432-4090

(Telephone number, including area code, of agent for service)



With copies to:
Darrin M. Ocasio, Esq.
Sichenzia Ross Friedman Ference LLP
61 Broadway, 32nd Floor
New York, NY 10006
(212) 930-9700

(212) 930-9725 (fax)



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

(Title of Class)



Check whether the issuer is not required to file reports pursuant to Section 13 or 15(d) of the Exchange Act: [ ]



Check whether the issuer: (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 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/A

 or any amendment to this Form




10-KSB/A

.. [ ]



Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES [   ] NO [X]



State issuer's revenues for its most recent fiscal year: $5,811,267



The aggregate market value of the registrant's common stock held by non-affiliates on April 7, 2008 (based on the closing price of the OTC Bulletin Board) on such date was approximately $3.6 million.





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225,154,440 shares of the issuer's common stock, par value $.0001 per share, were outstanding as of April 7, 2008.



DOCUMENTS INCORPORATED BY REFERENCE

None.



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





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CORD BLOOD AMERICA, INC. AND SUBSIDIARIES



2007 ANNUAL REPORT ON FORM 10-KSB

TABLE OF CONTENTS





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|PART I.                                                                                                                  |    
|                                                                                                                         |    
|Item 1.  Description of Business                                                                                         | 1  
|Item 2.  Description of Property                                                                                         | 10 
|Item 3.  Legal Proceedings                                                                                               | 11 
|Item 4.  Submission of Matters to a Vote of Security Holders                                                             | 11 
|                                                                                                                         |    
|                                                                                                                         |    
|PART II.                                                                                                                 |    
|                                                                                                                         |    
|Item 5.  Market for Common Equity and Related Stockholder Matters                                                        | 12 
|Item 6.  Management's Discussion and Analysis                                                                            | 13 
|Item 7.  Financial Statements                                                                                            | F-1
|Item 8.  Changes In and Disagreements With Accountants on Accounting and Financial Disclosure                            | 19 
|Item 8B.  Controls and Procedures                                                                                        | 19 
|                                                                                                                         |    
|                                                                                                                         |    
|PART III.                                                                                                                |    
|                                                                                                                         |    
|Item 9.  Directors, Executive Officers, Promoters and Control Persons; Compliance With Section 16(a) of the Exchange Act | 21 
|Item 10.  Executive Compensation                                                                                         | 22 
|Item 11.  Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters                 | 24 
|Item 12.  Certain Relationships and Related Transactions                                                                 | 25 
|Item 13.  Exhibits and Reports                                                                                           | 26 
|Item 14.  Principal Accountant Fees and Services                                                                         | 32 
|                                                                                                                         |    
|Signatures                                                                                                               | 33 
|                                                                                                                         |    
|                                                                                                                         |    
|Certifications                                                                                                           |    





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FORWARD-LOOKING STATEMENTS

Information included or incorporated by reference in this Form




10-KSB/A

 may contain forward-looking statements.  This information may involve known and unknown risks, uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from the future results, performance or achievements expressed or implied by any forward-looking statements.  Forward-looking statements, which involve assumptions and describe our future plans, strategies and expectations, are generally identifiable by use of the words may, will, should, expect, anticipate, estimate, believe, intend or project or the negative of these words or other variations on these words or comparable terminology.

Forward-looking statements include, without limitation, our ability to increase income streams, to grow revenue and earnings, and to obtain additional cord blood banking revenue streams.  Actual results could differ materially from those projected in the forward-looking statements as a result of a number of risks and uncertainties.  These risks and uncertainties include, but are not limited to:

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whether we will continue as a going concern;

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whether we will continue to increase revenues within our core business;

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whether we will generate revenues through offering additional stem cell services and acquiring other businesses in the stem cell industry;

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whether we will be successful in achieving our goals of diversifying revenue streams and working towards profitability;

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whether we are able to meet our financing requirements, and to ultimately achieve profitable operations

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whether we will gain tremendous value in building a database of qualified leads with specific demographic information which can be used to market a number of products and services;

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whether we will be able to further monetize our website traffic through the use of our web properties, and therefore offset increasing costs;

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whether we continue to develop new channel sales opportunities through the addition of strategic referral partnerships with Obstetrics and Gynecological practices and other healthcare professionals; and

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whether continuing to develop relationships with medical professionals who work closely with expectant families will further enhance our long-term growth and profitability.



Given such uncertainties, among others, undue reliance should not be placed on these forward-looking statements. The Companys past performance is not necessarily indicative of its future performance. The Company does not undertake, and the Company specifically disclaims any obligation, to update any forward-looking statements to reflect occurrences, developments, events or circumstances after the date of such statement.











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PART I



ITEM 1. DESCRIPTION OF BUSINESS



Cord Blood America, Inc. (CBAI), formerly D&A Lending, Inc., was incorporated in the State of Florida on October 12, 1999.  We did not commence business operations until we acquired Cord Partners, Inc., (Cord Partners), a Florida corporation and wholly owned subsidiary of CBAI, as of March 31, 2004. CBAI is primarily a holding company whose subsidiaries include Cord Partners (Cord), CorCell Co. Inc., CorCell Ltd., (CorCell), CBA Professional Services, Inc. D/B/A BodyCells, Inc. ("BodyCells"), CBA Properties, Inc. ("Properties"), and Career Channel Inc, D/B/A Rainmakers International ("Rain"). CBAI and its subsidiaries engage in the following business activities:



·

Cord specializes in providing private cord blood stem cell preservation services to families.

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BodyCells is a developmental stage company and intends to be in the business of collecting, processing and preserving peripheral blood and adipose tissue stem cells allowing individuals to privately preserve their stem cells for potential future use in stem cell therapy.

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Properties was formed to hold the corporate trademarks and other intellectual property of CBAI.

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Rain specializes in creating direct response television and radio advertising campaigns, including media placement and commercial production.



We intend to continue the organic growth of CBAI through continued improvement of internal processes, expanded channel development, direct response and internet marketing efforts to facilitate increased prospective customer contact.  Additionally, we will be concentrating our efforts on building additional sales channels through health insurance partners, obstetrics and gynecological practices and other healthcare professionals, hospitals and other health care influencers.  We also hope to leverage our growth through mergers and/or acquisitions of other stem cell preservation companies.  We negotiated two acquisitions in 2006, the first, Cryobank for Oncologic and Reproductive Donors (Cryobank) and the second, CorCells operating entity on October 13, 2006, and which closed on February 28, 2007.  On August 20, 2007, we completed the acquisition of specific assets from CureSource, Inc. We are currently exploring various acquisition opportunities and will continue to do so.  We intend to continue fund mergers and acquisitions from monies received from debt placements and/or private placements.



In addition to our current plans related to cord blood banking, we will continue to implement various growth strategies at Rain which continues to post increasing profitability.  We will focus on increasing revenues while keeping operating expenses to a minimum.



Industry Background of Cord



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, umbilical cord and placenta. 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



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type may also generate specialized cells of another tissue type, a characteristic referred to 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 significant fee 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 Cord, 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. Stem cells have been successfully recovered from cord blood after at least fifteen years of storage in liquid nitrogen. However, these cells may be able to retain their usefulness at least as long as the normal life span of an individual.



CORD



Services Provided By Cord



Cords customers are typically 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.  Through partnering with Progenitor Cell Therapies, Inc., Cord is able to provide services to collect, test, process and preserve umbilical cord blood.



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 approximately $1,925 and an annual storage fee of approximately $125 for each year thereafter, Cord provides 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.





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Comprehensive Testing. At the laboratory, the cord blood sample is tested for stem cell concentration levels and blood type. The cord blood sample 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, Progenitor Cell Therapies of Hackensack, New Jersey.



RISK FACTORS



An investment in our common stock involves a very significant risk. You should carefully consider the following risks and uncertainties in addition to other information in this prospectus in evaluating our company and its business before purchasing shares of our companys common stock. Our business, operating results and financial condition could be seriously harmed due to any of the following risks. You could lose all or part of your investment due to any of these risks.



Risks Related To Our Business



We Have Been the Subject of a Going Concern Opinion by Our Independent Auditors Who Have Raised Substantial Doubt as To Our Ability to Continue As a Going Concern



Our Independent Registered Public Accountants have added an explanatory paragraph to their audit opinions issued in connection with our consolidated financial statements which states that our financial statements raise substantial doubt as to our ability to continue as a going concern. We have experienced net losses from operations of $5,994,004 for the year ended December 31, 2007 and $5,688,732 for the year ended December 31, 2006. In addition, as of December 31, 2007 we had a working capital deficit of $8,942,298 and a working capital deficit of $6,878,777 as of December 31, 2006. These factors, among others, raise substantial doubt about our ability to continue as a going concern. Our consolidated financial statements do not include any adjustment that might result from the outcome of this uncertainty. Assurances cannot be given that adequate financing can be obtained to meet our capital needs. If we are unable to generate profits and unable to continue to obtain financing to meet our working capital requirements, we may have to curtail our business sharply or cease operations altogether. Our continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis to retain our current financing, to obtain additional financing, and, ultimately, to attain profitability. Should any of these events not occur, we will be adversely affected and we may have to cease operations.



We May Not Be Able To Increase Sales or Otherwise Successfully Operate Our Business, Which Could Have A Significant Negative Impact On Our Financial Condition



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



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



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





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We may not be able to increase our sales or effectively operate our business. To the extent we are unable to achieve sales growth, we may continue to incur losses. We may not be successful or make progress in the growth and operation of our business. Our current and future expense levels are based on operating plans and estimates of future sales and revenues and are subject to increase as strategies are implemented. Even if our sales grow, we may be unable to adjust spending in a timely manner to compensate for any unexpected revenue shortfall.



Accordingly, any significant shortfall in revenues would likely have an immediate material adverse effect on our business, operating results and financial condition. Further, if we substantially increase our operating expenses to increase sales and marketing, and such expenses are not subsequently followed by increased revenues, our operating performance and results would be adversely affected and, if sustained, could have a material adverse effect on our business. To the extent we implement cost reduction efforts to align our costs with revenue, our sales could be adversely affected.



We May Be Unable To Manage Growth, Which May Impact Our Potential Profitability.



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

·

Establish definitive business strategies, goals and objectives

·

Maintain a system of management controls

·

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



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



We Are Dependent Upon External Financing To Fund Our Ongoing Operations And Implement Our Business Plan.



Currently, we are dependent upon external financing to fund our operations. It is imperative that we receive this external financing to implement our business plan and to finance ongoing operations. New capital may not be available and adequate funds may not be sufficient for our operations, and may not be available when needed or on terms acceptable to our management. Our failure to obtain adequate additional financing may require us to delay, curtail or scale back some or all of our operations and may hinder our ability to expand or continue our business.

Any additional financing may involve dilution to our then-existing shareholders, which could result in a decrease in the price of our shares.



We Are Dependent Upon A Third Party Facility For The Storage Of Umbilical Cord Blood; If Our Storage Arrangements Terminate Or The Facility Fails For Any Reason, We May Not Be Able To Provide Cord Blood Banking Services For Some Period Of Time.



We do not own or operate a storage facility for umbilical cord blood. On August 1, 2007, CBAI entered into an agreement with Progenitor Cell Therapy, LLC (PCT) for testing, processing and storage of cord blood samples, and terminated an agreement with Bergen Community Regional Blood Center (Bergen). If our agreement with PCT 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.



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



Any material disruption in the ability to maintain continued, uninterrupted storage systems could have a material adverse effect on our business, operating results and financial condition. Our systems and operations are vulnerable to damage or interruption from fire, flood, break-ins, tornadoes and similar events for which we may not carry sufficient business interruption insurance to compensate us for losses that may occur.



We Are Dependent Upon A Patent License Agreement For Certain Technology And Processes Utilized To Collect, Process And Store Umbilical Cord Blood; If Our Licensing Arrangement Terminates For Any Reason, We May Not Be Able To Collect, Process Or Store Umbilical Cord Blood For Some Period Of Time.





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



If We Do Not Obtain And Maintain Necessary Domestic Regulatory Registrations, Approvals And Comply With Ongoing Regulations, We May Not Be Able To Market Our Cord Blood Banking Services.



The cord blood banking services that we provide are currently subject to FDA regulations requiring infectious disease testing. The cord blood facility we use has registered with the FDA as a cord blood banking service, listed its products with the FDA, and will be subject to FDA inspection. In addition, the FDA has proposed new good tissue practice regulations that would establish a comprehensive regulatory program for human cellular and tissue-based products as well as proposed rules for donor suitability. Consistent with industry practice, our cord blood collection kits have not been cleared as a medical device.



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



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



Because Our Industry Is Subject To Rapid Technological And Therapeutic Changes And New Developments, Our Future Success Will Depend On The Continued Viability Of The Use Of Stem Cells And Our Ability To Respond To The Changes.



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



Our Markets Are Increasingly Competitive And, In The Event We Are Unable To Compete Against Larger Competitors, Our Business Could Be Adversely Affected.



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



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



Our Information Systems Are Critical To Our Business And A Failure Of Those Systems Could Materially Harm Us.



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





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We Could Fail To Attract Or Retain Key Personnel, Which Could Be Detrimental To Our Operations.



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



Explanation of Material Agreements



Blood Bank Service Agreement



Pursuant to our Service Agreement with Bergen Community Regional Blood Center (Bergen), the blood center would test all cord blood received from CBAI 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. Bergen would be compensated for its services based upon the number of umbilical cord blood units stored with it by Cord each month.



On August 1, 2007, CBAI entered into an agreement with Progenitor Cell Therapy, LLC (PCT) for testing, processing and storage of cord blood samples.  As a result of our agreement with PCT we terminated our agreement with Bergen.  We believe this transition from Bergen to PCT will provide additional leverage to operating costs and efficiencies while maintaining the highest of quality standards. Several other blood centers also provide the services currently provided to us by PCT. If our agreement with PCT 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.



Patent License Agreement



PharmaStem Therapeutics 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 Cord Partners and certain of its competitors alleging infringement of its patents. Management of Cord Partners determined to settle, rather than to litigate, this matter. As a result, PharmaStem and Cord Partners entered into a Patent License Agreement in March 2004. Pursuant to the Patent License Agreement, Cord Partners may, on a non-exclusive basis, collect, process and store cord blood utilizing PharmaStem technology and processes covered by its patents for so long as the patents may remain in effect. All of the patents are scheduled to expire in 2010. Cord Partners is obligated under the Patent License Agreement to pay royalties to PharmaStem of 15% of all revenues generated by Cord Partners from the collection and storage of cord blood on and after January 1, 2004. Other than royalties, no amount is payable by Cord Partners to PharmaStem. All litigation between the parties was dismissed and all prior claims were released.



CorCell Acquisition



On October 13, 2006, we entered into an Asset Purchase Agreement with Vita34 for the assets of CorCell, Inc., to begin the process of acquiring the business of collection, processing and storage of blood taken from umbilical cord after a child is born. On February 28, 2007, we completed the acquisition. The acquisition related to all rights to possession and custody of all acquired samples owned by CorCell, Inc. and associated with the operations of CorCell, Inc. which is predominantly the current customer base and revenues. The deal also included the purchase of cryogenic freezers and other fixed assets used in this umbilical cord blood samples business. CorCell is not PharmaStem licensed.



Enable Transaction



On November 26, 2007, we entered into a Securities Purchase Agreement (the Securities Purchase Agreement) pursuant to which we issued and sold an aggregate of $1,931,106.20 principal amount of 0% Senior Convertible Notes (the Notes) to accredited investors (the Purchasers) in a private placement. The Notes were sold at a 20% discount. A portion of the principal amount of the Notes in the amount of $680,000 was paid by the Purchasers by converting $544,000 in interest owed by the Company on outstanding notes. We received gross proceeds of approximately $1,000,000, of which we used $155,000 for financing costs.  As part of the transaction, the Purchasers were also issued warrants (the Purchaser Warrants) to purchase 48,277,655 shares of the Companys Common Stock, $0.0001 par value per share (Common Stock), at the exercise price of $0.037 per share.





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On March 10, 2008, we reduced the warrant exercise price of the Purchaser Warrants from $0.037 to $0.0086, so long as the Warrants were exercised by April 30, 2008, after which time the warrant exercise price would revert to $0.037, subject to adjustment as provided in the Warrants.



The 0% Senior Convertible Notes



The Notes are due on November 26, 2009.  So long as the registration statement that the Company is required to file pursuant to the Securities Purchase Agreement and the registration rights agreement entered into in connection therewith (the Registration Rights Agreement) (the Registration Statement), is effective, the Company will have the right to prepay, prior to the second year anniversary of the issuance of the Notes, in cash all or a portion of the Notes at 120% of the outstanding principal plus accrued interest to the date of the prepayment.  Beginning on May 26, 2008, and continuing on the same date of each successive month thereafter, the Company shall repay 1/18th of the original principal amount of the Notes either in cash or in Common Stock, at the Companys option.  If the Company elects to repay the Notes in common stock, the number of shares issued will be based on the lesser of (i) 10% discount onto the weighted average price of the 10 trading days immediately preceding (but not including) the applicable repayment date or (ii) the then conversion price, as adjusted.



The initial conversion price of the Notes is $0.03 per share.  With certain exceptions set forth in the Notes, if the Company issues common stock at a price lower than the conversion price of the Notes, or issues convertible securities with a conversion price lower than the conversion price of the Notes , then the conversion price of the Notes will be reduced to such price.  As a result of the reduction of the Purchaser Warrants, the conversion price of the Notes has been reduced to $0.0086, pursuant to Section 7(a) of the Notes.



The Notes contain certain covenants of the Company which the Company must adhere to while the Notes are outstanding, including that:



·

all payments due under the Notes (i) shall rank junior to all indebtedness of the Company and its subsidiaries as of the issuance date, (ii) shall rank pari passu with all other convertible notes and (iii) shall rank senior to all indebtedness of the Company and its subsidiaries incurred after the issuance date;



·

the Company and its subsidiaries shall not incur any indebtedness if such indebtedness (including the issuance of debt securities) will result in the ratio at the time of such event(s) to fall below the lesser of (i) 1.0 and (ii) the ratio existing as of the issuance date;



·

the Company shall not enter or incur any liens and shall not permit any subsidiary to incur indebtedness other than permitted indebtedness;



·

the Company and its subsidiaries shall not make any restricted payments, except for subordinated debt or subsidiaries of the Company may make restricted payments to the Company; and



·

the Company shall not pay dividends.



Defaults under the Notes include the following:



·

If the Registration Statement is required to be maintained effective and such effectiveness lapses;



·

If the Company’s common stock is suspended from trading on its principal trading market;



·

A default under any notes executed by the Company;



·

If the Company fails to pay interest or liquidated damages when due; and



·

If the Company fails to perform any covenant.



If an event of default occurs, the holders of the Notes may require the Company to (i) redeem all or any portion of the Notes (ii) convert any portion of the Notes then held by the holders into shares of common stock, equal to a number of shares of common stock equal to the principal amount outstanding on the Notes divided by 96% of the lowest daily volume weighted average price of the common stock during the 30 trading days immediately prior to the date of such conversion.  Each portion of the Notes subject to redemption by the Company shall be redeemed by the Company at a price equal to the conversion amount to be redeemed.  During the continuance of an event of default, the Notes shall accrue interest on any unpaid principal amount at an annual rate equal to 12%.



The holders of the Notes shall not have the right to convert the Notes, to the extent that after giving effect to such conversion, such holder would beneficially own in excess of 9.99% of the shares of the Companys Common Stock immediately after giving effect to such conversion.





7



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As previously mentioned, we issued the Purchasers warrants to purchase 48,277,655 shares of the Companys Common Stock at an exercise price of $0.037 per share, , which were subsequently reduced to $0.0086.  The Purchaser Warrants may be exercised any time until November 31, 2012.



The Purchaser Warrant holders may not exercise the Purchaser Warrants for a number of shares of common stock in excess of that number of shares which upon giving effect to such exercise would cause the aggregate number of shares beneficially owned by the holder to exceed 9.99% of the outstanding shares of the common stock following such exercise, except within 60 days of the expiration of the Warrants.



In connection with this transaction, we executed a security agreement pursuant to which we granted a security interest and lien on substantially all of our assets.  The lien shall terminate immediately when the Notes and all amounts due in connection with the Notes are satisfied.



In connection with the transaction, the Company paid placement agent fees in the amount of $90,000.  In addition, we issued the placement agents, including their employees and affiliates, an aggregate of 5,833,332 warrants (the Broker Warrants) to purchase the Companys Common Stock. The Broker Warrants have the same terms as the Purchaser Warrants, except that, 2,916,666 of the Broker Warrants have an exercise price of $0.03.



Pursuant to the Registration Rights Agreement, we filed a registration statement to register the shares of common stock issuable upon exercise of the Purchaser Warrants and conversion of the Notes.  The initial registration statement was filed on December 28, 2007 and declared effective by January 17, 2008.



Shelter Island Line of Credit



On November 26, 2007, the Company entered into a Second Amendment (the Second Amendment) to the Securities Purchase Agreement,  dated as of February 14, 2007, as amended by the First Amendment, dated as of April 9, 2007, by and among CorCell, Ltd., a Nevada corporation (a subsidiary of the Company) (CorCell), the Company, and Shelter Island Opportunity Fund, LLP (Shelter Island), pursuant to which the Company may borrow an amount not to exceed $1,000,000, exercisable at its option.  Such funds may be drawn down in installments by the Company in amounts of at least $200,000, or an integral multiple in excess thereof. In connection with the transaction, the Company issued, executed and delivered to the Shelter Island the following:



·

A Security Agreement (the “CorCell Security Agreement”);



·

A Secured Original Issue Discount Debenture with a principal amount not to exceed $1,000,000 (the “Debentures”);



·

A Common Stock Purchase Warrant to purchase 20,270,270 shares of Common Stock (the “Shelter Island Warrants”);



·

A Put Option Agreement; and



·

A Subordination Agreement



In the event the Company draws down on the line of credit, it will issue the Debenture, which matures on May 26, 2010 (the “Maturity Date).  Annual interest on the Debenture is the greater of (i) the sum of 4.00% plus the Prime Rate on such date or (ii) 11.75%.  Interest on the Debenture is payable in arrears (x) prior to the Maturity Date, on the last trading day of the second month immediately succeeding the month in which the first advance is made and on the last trading day of each month thereafter until the Maturity Date, (y) in full on the Maturity Date and (z) on demand after the Maturity Date.



The Company issued the Purchasers Shelter Island warrants to purchase 20,270,270 shares of the companys Common Stock at a purchase price of $0.037 per share.  The Shelter Island warrants may be exercised any time until November 31, 2012.



The Company has also granted Shelter Island a put option pursuant to the Second Amendment pursuant to which Shelter Island can sell the shares issued to Shelter Island under the Second Amendment back to the Company for the product of (i) the aggregate of all advances made (whether or not they are then outstanding) by Shelter Island to CorCell under the Debenture, and (ii) 60.00% (or, on a per put share basis, such product divided by the total number of put shares) at any time during the earlier to occur of the following put option exercise periods: (a) the ten business day period commencing on the first anniversary of the closing date, or (b) the ten business day period commencing on the date which is nine months after the date that the registration statement for the registration of the issued shares is declared effective by the Securities and Exchange Commission.



In addition, CorCell, a subsidiary of the Company, entered into a Subordination Agreement in which the Purchasers under the Enable transaction subordinated to Shelter Island any security interest or lien that Purchasers may have in the collateral of CorCell.  The security interest of Shelter Island shall at all times be senior to the security interest of the Purchasers.



8



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CureSource Asset Acquisition



On August 20, 2007, we completed the acquisition of specific assets from CureSource, Inc., for the aggregate purchase price of $106,500 in cash and $10,000 paid in common restricted shares of the company, for a total purchase price of $116,500. The asset purchase related to the existing customer samples owned by CureSource, Inc. and associated with the operations of CureSource, Inc., which predominantly is the current customer base and revenues.



BODYCELLS



BodyCells is a developmental stage company in the business of collecting, processing and preserving peripheral blood and adipose tissue stem cells that allows individuals to privately preserve their stem cells for potential future use in stem cell therapy.



PROPERTIES



Properties holds all of the trademarks and other intellectual property of CBA and its subsidiaries. The trademarks were applied for in the fourth quarter of 2004. The trademark, Cord Partners was registered with the United States Patent and Trademark office on January 17, 2006.



RAIN



Rain was acquired on February 28, 2005 and is in the business of advertising.  Sources of revenue for Rain include:  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; procuring and placing advertising sponsorships in motor sports, procuring and creating telephone on-hold advertising messages; and procuring and placing print advertising.



Costs of services associated with the revenues of Rain are as follows:  set up and per minute charges from the procured call center; set up, filming, recording, creating graphics, editing, dubbing and distribution of commercials produced; media venue fees for advertising procured; production of on-hold messaging; digital equipment for on-hold messaging; motor sports sponsorship inventory; and media venue fees for sales leads generated via per inquiry advertising.





Advertising and Direct Marketing



Rain offers its advertising and direct marketing customers a range of services including:



·

the placement of advertising in television and radio outlets;



·

the production of advertising content, including television commercials, and radio copy



·

advertising and marketing consulting services relating to the customers marketing campaign.



·

the placement of motor sports sponsorships; and



·

the placement and production of on-hold advertising and messaging.



In performing its advertising agency services, Rain outsources commercial production services to third party production companies.



Rains advertising clients are typically small companies for whom its range of services include, in addition to the placement of advertising, a range of consulting services which can include assistance in not only developing an advertising program, but helping the client to design or develop the particular product or service, determine the appropriate market and design and implement an overall marketing program and strategy.



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FAMILY MARKETING



Family Marketing specializes in delivering leads generated through various forms of internet advertising to corporate customers in the business of family based products and services. In the summer of 2006, Company management decided to sell this business and to redeploy resources to other areas.  As a result, on September 5, 2006, the Company entered into a Stock Purchase Agreement (the Purchase Agreement) with Noah Anderson, the President of Family Marketing and at the time the Chief Technology Officer of the Company.  Pursuant to the Purchase Agreement, the Company sold all assets including customers, websites and related software and trademarks along with liabilities of Family Marketing to Mr. Anderson, in exchange for a credit of $82,500 against receivables that Cord Partners owed Family Marketing and the cancellation of $32,500 in severance compensation to Mr. Anderson (the Sale).



Competition



The marketing communications business is highly competitive, with agencies of all sizes and disciplines competing primarily on the basis of reputation and quality of service to attract and retain clients and personnel. Companies such as Integrated Media, Last Second Media, Media Associates, RevShare, Mercury Media, ChoicePoint Precision Marketing and E&M Advertising generally serve large corporations.  We intend to seek a market niche by providing a full level of service quality that users of direct marketing services may not receive from our larger competitors.  Most of our advertising clients are smaller companies that would not typically be sought by the major advertising and marketing companies.



Our customers compete with products of many large and small companies, including well-known global competitors.  We market our customers with advertising, promotions and other vehicles to build awareness of their brands in conjunction with an extensive sales force including direct response advertising.  We believe this combination provides the most efficient method of marketing for these types of products.  We believe that we gain a certain level of competitive advantage by utilizing cost savings from our direct response advertising sector for multiple customers.



Government Regulation



The Federal Trade Commission establishes and enforces various regulations put in place to ensure fair advertising. Because we are not marketing our own products, and only buying media for other customer products, our liabilities under such practices are decreased and we protect against advertising any product that does not meet the highest standards of the FTC guidelines.



Dependence on One or a Few Major Customers



Traditionally, Rain has been dependent on a few major customers.  However, in 2007, Rain diversified its advertising strategy and now many customers have taken the place of a few major customers.



Employees



As of December 31, 2007, we have fourteen employees, all of whom are full time.  Our full-time employees include our Chairman of the Board and Chief Executive Officer, and customer service and sales personnel.  We believe our relations with all of our employees are good.



ITEM 2. DESCRIPTION OF PROPERTY



Our principal office is located at 501 Santa Monica Blvd., Suite 700, Santa Monica, CA 90401.  The property is a suite of approximately 2,200 square feet. The property is leased from an unaffiliated third party for a period of 5 years ending September 2012. The monthly lease payments are approximately $9,500. The Company also leases office space of approximately 900 square feet at 506 Santa Monica Blvd., Suite 217, across the street from its principal office. This two year term ends in February 2010 and leases for approximately $3,900 per month.



A second office is located at 1717 Arch Street, Suite 1410, Philadelphia, PA 90401. The property is a suite of approximately 7,000 square feet. The property is leased from an unaffiliated third party for a period of 5 years, renewable annually in September, ending in September 2012. The monthly lease payments are approximately $14,000 per month. The Company has negotiated an early termination to this lease prior to the September 2008 renewal date and relocated to smaller space of approximately 1,000 square feet at 221 S. 12th St., #314S, Philadelphia, PA  19106 at an approximate lease amount of $1400 per month..



We maintain fire and casualty insurance on our leased property in an amount deemed adequate by management.





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ITEM 3. LEGAL PROCEEDINGS



We are not currently involved in any legal proceedings.



ITEM 4. SUBMISSION OF MATTERS TO A VOTE



None.



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PART II



ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS



(a) Market Information. Our Common Stock is traded on the OTC Bulletin Board, under the symbol CBAI.OB.



The following table sets forth, for the periods indicated, the high and low bid prices of the Companys Common Stock traded on the OTC Bulletin Board for fiscal years ended December 31, 2007, and December 31, 2006. The quotations reflect inter-dealer prices, without retail mark-up, mark-down or commission, and may not represent actual transactions.



|                 |  |              |       |  |     |       |  |  |  |  | 
|---------------- |  | ------------ | ----- |  | --- | ----- |  |  |  |  | 
|                 |  |              |       |  |     |       |  |  |  |  | 
|                 |  |              |       |  |     |       | 
|                 |  | Common Stock |      
|Fiscal Year 2007 |  |              | High  |  | Low |      
|First Quarter    |  | $            | 0.24  |  | $   | 0.087 | 
|Second Quarter   |  | $            | 0.11  |  | $   | 0.041 | 
|Third Quarter    |  | $            | 0.065 |  | $   | 0.034 | 
|Fourth Quarter   |  | $            | 0.055 |  | $   | 0.016 | 
|                 |  | Common Stock |      
|Fiscal Year 2006 |  |              | High  |  | Low |      
|First Quarter    |  | $            | 0.20  |  | $   | 0.13  | 
|Second Quarter   |  | $            | 0.27  |  | $   | 0.13  | 
|Third Quarter    |  | $            | 0.15  |  | $   | 0.07  | 
|Fourth Quarter   |  | $            | 0.15  |  | $   | 0.09  | 
|                 |  |              |       |  |     |       | 



(b) Holders. As of April 7, 2008, our Common Stock was held by approximately 640 shareholders of record. Our transfer agent is Interwest Transfer Company, Inc., with offices at 1981 East 4800 South, Suite 100, P.O. Box 17136, Salt Lake City, Utah 84117, phone number 801-272-9294. The transfer agent is responsible for all record-keeping and administrative functions in connection with the common shares of stock.



(c) Dividends. We have never declared or paid a cash dividend. There are no restrictions on the common stock or otherwise that limit our ability to pay cash dividends if declared by the Board of Directors. We do not anticipate declaring or paying any cash dividends in the foreseeable future.



(d) Securities Authorized for Issuance Under Equity Compensation Plans.



Equity Compensation Plan Information



The following table sets forth the information indicated with respect to our compensation plans as of December 31, 2007, under which our common stock is authorized for issuance.



|                                                           |  |                                                                                                 |  |                                                                                 |  |                                                                                                                                                
|---------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------- |  | ------------------------------------------------------------------------------- |  | -----------------------------------------------------------------------------------------------------------------------------------------------
|                                                           |  |                                                                                                 |  |                                                                                 |  |                                                                                                                                                
|                                                           |  | Number of Securities to be issued
upon exercise of outstanding
options, warrants and rights
(a) |  | Weighted average
exercise price of
outstanding options,
warrants and rights
(b) |  | Number of securities
remaining available for
future issuance under
equity compensation plans
(excluding securities
reflected in column (a))
(c)
|                                                           |  |                                                                                                 |  |                                                                                 |  |                                                                                                                                                
|Equity compensation plans approved by security holders     |  | 6,027,862                                                                                       |  | $0.28                                                                           |  | 1,972,138                                                                                                                                      
|Equity compensation plans not approved by security holders |  | N/A                                                                                             |  |                                                                                 |  |                                                                                                                                                
|Total                                                      |  | 6,027,862                                                                                       |  |                                                                                 |  | 1,972,138                                                                                                                                      





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ITEM 6. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS



Summary and Outlook of the Business



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



We operate two core businesses:



·

Cord operates the umbilical cord blood stem cell preservation operations,



·

Rain operates the television, radio, on-hold and motor sports advertising operations



Cord



The umbilical cord blood stem cell preservation operations provide umbilical cord blood banking services to expectant parents throughout all 50 United States. Our corporate headquarters are located in Los Angeles, CA. Cord also maintains offices in Philadelphia, Pennsylvania, which were the former offices of the CorCell operations and are leased from CorCell, Inc. Cord earns revenue through a one-time enrollment and processing fee, and through an annually recurring storage and maintenance fee. Cord blood testing, processing, and storage is conducted by our outsourced laboratory partner, formerly Bergen Community Regional Blood Services, located in Paramus, New Jersey. On August 1, 2007, CBAI entered into an agreement with Progenitor Cell Therapy, LLC, (PCT) for testing, processing and storage of cord blood samples.  The Company believes this transition from Bergen to PCT will provide additional leverage to operating costs and efficiencies while maintaining the highest of quality standards. We provide the following services to each customer. In addition, some storage services are provided by ThermoFisher of Rockville, Maryland.



·

Collection Materials. We provide a medical kit that contains all of the materials necessary for collecting the newborn’s umbilical cord blood at birth and packaging the unit for transportation. The kit also provides for collecting a maternal blood sample for later testing.



·

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 for the successful collection, packaging, and transportation of the cord blood & maternal blood samples.



·

Transportation. We coordinate the transportation of the cord blood unit to our laboratory partner, Progenitor Cell Therapies, immediately following birth. This process utilizes a private medical courier, Airnet, for maximum efficiency and security.



·

Comprehensive Testing. At the laboratory, the cord blood sample is tested for stem cell concentration levels, bacteria and blood type.  The maternal blood sample is tested for infectious diseases. We report these results to the newborn’s mother.



·

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.



We believe Cords revenue and gross profit will benefit from the asset purchase of CorCell. Going forward, management will continue to assess the market conditions, particularly related to the cost of customer acquisition, and whether organic growth or continued M&A activity will lead CBAI closer to profitability.



Rain



Rain, the television, radio, on-hold and motor sports advertising operations, are located in the corporate headquarters in Los Angeles, CA. The offices were relocated from Carlsbad, CA in September 2006. Rain provides advertising and direct marketing customers a range of services including:



·

the placement of advertising in television, radio, on-hold and motor sports outlets;



·

the production of advertising content, including television commercials and radio copy, which is outsourced to third party production companies; and





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·

advertising and marketing consulting services which can include assistance in not only developing an advertising program, but helping the client to develop the particular product or service, determine the appropriate market and design and implement an overall marketing program and strategy.



A majority of Rain's revenues are earned via direct response media buys and per inquiry campaigns. For direct response, we currently buy television and radio schedules for our clients on a national and local level. Our national television outlets include Directv, DISH Network, Comcast Digital, national cable networks and various local cable interconnects. We buy time with numerous national radio networks including Premiere Radio, Clear Channel, Westwood One and Jones Radio Network, along with a variety of local radio stations. For per inquiry advertising, we focus on national campaigns. The placements are made using our internal media buyers and other agencies with which we have formed strategic marketing alliances. We also generate revenues through the commercial production aspect of our business using production partners in Florida and California.  Our on-hold advertising is placed on a clients telephone system.  Production is outsourced to AudioMenu of Fort Lauderdale, FL.  Motor sports sponsorship is placed on vehicles in various motor sports circuits.  Most advertising has been placed with BAM Racing; LLC.  In January of 2008 we entered in a non-exclusive agreement with BAM Racing, LLC.  The agreement compensates for sales of sponsorship of NASCAR Sprint Cup Team #49.



BodyCells



We are continuing to pursue other growth opportunities by acquisition or internal growth. The development of BodyCells, which is anticipated to facilitate the collecting, processing and preserving of peripheral blood and adipose tissue stem cells allowing individuals to privately preserve their stem cells for potential future use in stem cell therapy, is currently suspended pending the identification of an alternative lab to partner.



Consolidation



On February 28, 2005, Cord Blood entered into a purchase and sale agreement to purchase 100% of the outstanding shares of Rain through a share exchange.  Because Cord Blood and Rain were entities under common control, this transaction was accounted for in a manner similar to a pooling of interests.  The shareholders of Rain were issued 3,656,000 shares of common stock in Cord Blood for all of their outstanding shares of Rain.



Going Concern



Our consolidated financial statements have been prepared assuming we will continue as a going concern.  We had net losses of $5,944,004 for the year ended December 31, 2007.  We had an accumulated deficit of approximately $18,000,000 and a working capital deficit of $8,942,298 as of December 31, 2007.  These factors, among others, raise substantial doubt about our ability to continue as a going concern.  Our financial statements do not include any adjustment that might result from the outcome of this uncertainty.  Assurances cannot be given that adequate financing can be obtained to meet our capital needs.  If we are unable to generate profits and unable to continue to obtain financing to meet our working capital requirements, we may have to curtail our business sharply or cease operations altogether.  Our continuation as a going concern is dependent upon our ability to generate sufficient cash flow to meet our obligations on a timely basis to retain our current financing, to obtain additional financing, and, ultimately, to attain profitability.  Should any of these events not occur, the accompanying financial statements will be adversely effected and we may have to curtail or cease operations.



Critical Accounting Policies



We define critical accounting policies as those that are important to the portrayal of our financial condition and results of operations and require estimates and assumptions based on our judgment of changing market conditions and the performance of our assets and liabilities at any given time. In determining which accounting policies meet this definition, we considered our policies with respect to the valuation of our assets and liabilities and estimates and assumptions used in determining those valuations. We believe the most critical accounting issues that require the most complex and difficult judgments and that are particularly susceptible to significant change to our financial condition and results of operations include the following:



·

determination of the level of allowance for bad debt;



·

deferred revenue; and



·

revenue recognition



Accounts Receivable



Accounts receivable consist of the amounts due for the processing and storage of umbilical cord blood, advertising, commercial production and internet lead generation. Accounts receivable relating to deferred revenues are netted against deferred revenue for presentation purposes. The



14



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allowance for doubtful accounts is estimated based upon historical experience. The allowance is reviewed periodically and adjusted for accounts deemed uncollectible by management. Amounts are written off when all collection efforts have failed.



Deferred Revenue



Deferred revenue for Cord consists of payments for enrollment in the program and processing of umbilical cord blood by customers whose samples have not yet been collected, as well as the pro-rata share of annual storage fees for customers whose samples were stored during the year. For Cord customers who have enrolled in the Annual Payment Option, revenue is recognized in the amount of each payment, as received. Deferred revenue for Rain consists of payments for per inquiry leads that have not yet been delivered or media buys that have not yet been placed.



Revenue Recognition



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



Cord Blood recognizes revenue from both enrollment fees and processing fees upon the completion of processing. Storage fees are recognized ratably over the contractual storage period, unless the customer enrolls in the Annual Payment Option.



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



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



Completion of Acquisition or Disposition of Assets



Cryobank



On January 24, 2006, CBAI completed the acquisition of certain assets from Cryobank for Oncologic and Reproductive Donors, Inc., a New York corporation, for the purchase price of $120,000 in cash and $140,000, or 703,518, unregistered shares of CBAI's common stock. The acquisition related to our collecting, testing, processing and preserving umbilical cord blood and included the assets and liabilities associated with approximately 750 umbilical cord blood samples, as well as three cryogenic freezers used for the storage of such umbilical cord blood samples.



CorCell



On February 28, 2007, CBAI completed the acquisition of specific assets from CorCell for the aggregate purchase price of $5,653,707 in cash and restricted common stock of the Company and assumption of liabilities. The acquisition related to existing customer samples owned by CorCell and the associated operations of CorCell, which predominantly is the current customer base and its related revenues.



On February 28, 2007, and related to this transaction, the Company entered into a Promissory Note with CorCell whereby, the Company (i) issued to CorCell a Promissory Note bearing interest at the rate of 10.5% with an aggregate principal amount of $250,000, due 4 months from the date of issuance, unless redeemed prior thereto by CorCell.  The Promissory Note is subject to acceleration upon an event of default, as defined in the Promissory Note. CorCell was also granted 1,666,667 shares of restricted common stock of the Company as collateral.



On February 28, 2007, and related to this transaction, the Company entered into a Convertible Note with CorCell. Pursuant to the Convertible Note, the Company (i) issued to CorCell a Convertible Note bearing interest at the rate of 9% with an aggregate principal amount of $212,959, due 6 months from the date of issuance, unless redeemed prior by CorCell. The Convertible Note also is subject to acceleration upon an event of default, as defined in the Convertible Note. At the option of CorCell, the Convertible Note may be converted into restricted common stock at $0.101 per share, with possible adjustment.





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CureSource



On August 20, 2007, we completed the acquisition of specific assets from CureSource, Inc., for the aggregate purchase price of $106,500  in cash and $10,000 paid in common restricted shares of the company, for a total purchase price of $116,500. The asset purchase related to the existing customer samples owned by CureSource, Inc. and associated with the operations of CureSource, Inc., which predominantly is the current customer base and revenues.



Results of Operations for the Year Ended December 31, 2007 Compared To the Year Ended December 31, 2006



For the year ended December 31, 2007, our total revenue increased $2.5 million or 74% to $5.8 million due to two factors: Rains revenues increased from approximately $2.2 million in 2006 to approximately $2.6 in 2007, or 20%, as a result of additional marketing and exposure for our Radio and Television Advertising services, which resulted in the addition to our customer base and increased revenue from existing customers. Cords revenues increased $2.1 million or 180% to $3.2 million, primarily due to the Companys acquisition of more umbilical cord samples along with customer lists.



Cost of services increased by approximately $791,000 as a result of substantially higher revenues, but Gross Profit increased from 8.5% of revenues to 34.0% as economies of scale, especially for the Companys Cord division, start impacting the Companys results. The Company anticipates that through the continued growth and expansion of its Cord business, they will increasingly benefit from economies of scale in that business segment.



Administrative and selling expenses increased by approximately $2.1 million or 54.2% from the prior comparative period to $5.9 million. With the acquisition of CorCell, the Company has temporarily increased some of its administrative expenses, until it completes its integration plans.

These include an increase in capital raising expenses and financial consulting charges and fees of $793,000, loan discounts expensed of $218,000, office, rent and related expenses of $150,000 and increases of $502,000 in depreciation and amortization, a consequence of the acquisition of additional equipment and customer lists. The Company also entered into a consulting arrangement whereby it issued shares in exchange for negotiating credit terms with its trade suppliers. The Company expensed fully these charges, totaling approximately $1.4 million.   On the other hand, the cost-cutting measures implemented in 2006 are now being felt for the entire period. These include a decrease in total labor costs of $222,000, a reduction in marketing costs of $339,000,.  The Company has had to raise additional debt to finance both its acquisitions as well as its operating losses. Interest costs remained approximately the same, going from $2,113,000 in the year ended December 31, 2006 to $2,083,000 in 2007. All interest charges during the year have been accrued.



Our net loss from continuing operations increased slightly from the comparative period, increasing 5.4% to $5,994,000.



Liquidity and Capital Resources



We have experienced net losses from continuing operations of $5,994,000 and $5,688,732 for the years ended December 31, 2007 and 2006, respectively. At December 31, 2007, we had $338,828 in cash. However, at December 31, 2007, we had a working capital deficit of $8,942,298. We will continue to carry a deficit until such time, if ever, that we can increase our assets and reduce our significant liabilities which are currently composed of notes payable, accounts payable and accrued expenses. While reducing the working capital deficit is our long-term goal, we do not foresee this occurring in the near future. We currently collect cash receipts from operations through both of our subsidiaries: Cord and Rain. In addition, the CorCell business also collects cash receipts through its Pennsylvania office. However, all corporate expenses such as legal, auditing, investor relations and interest are currently being paid through Cord. Cord's cash flows from operations are not currently sufficient to fund operations in combination with these corporate expenses. Because of this shortfall, we have had to obtain additional capital through other sources as discussed in Note 7, Notes and Loans Payable.



Since inception, we have financed cash flow requirements through the issuance of common stock and warrants 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 equity offerings and borrowings to the extent necessary to provide working capital. Financing may not be available, and, if available, it may not be available on acceptable terms. Should we secure such financing, it could have a negative impact on our financial condition and our shareholders. The sale of debt would, among other things, adversely impact our balance sheet, increase our expenses and increase our cash flow requirements. The sale of equity would, among other things, result in dilution to our shareholders. If our cash flows from operations are significantly less than projected, then we would either need to cut back on our budgeted spending, look to outside sources for additional funding or a combination of the two. If we are unable to access sufficient funds when needed, obtain additional external funding or generate sufficient revenue from the sale of our products, we could be forced to curtail or possibly cease operations.



Financial Condition and Results Of Operations as of December 31, 2007



As of December 31, 2007, total assets increased  821% to $6,733,000, compared to $731,000 as of December 31, 2006. Items of significance  include an increase in Customer Lists and Customer Contracts of over $4.6 million as a consequence of the Companys acquisitions, and an increase of approximately $1.2 million of deferred financing costs resulting from the recording of deferred financing costs resulting from the issuance of warrants and convertible debentures on the financing of its acquisition of CorCell



16



---



As of December 31, 2007, total liabilities increased 43% to approximately $9.9 million as compared to approximately $6.9 million as of December 31, 2006. Significant items include increases in accounts payable and accrued expenses of approximately 109%, to approximately $2.8 million, which is primarily attributable to the Companys purchase of the liabilities of CorCell. There was also an 11% increase in promissory notes payable and related derivative liability, or approximately $566,000 which is primarily as a result of this same acquisition, along with re-financing of its existing debt, new debt of $1,162,000, and issuance of derivative liability for $5,435,000, offset by a reduction in value of $6,885,000.



At December 31, 2007, we had a working capital deficit of approximately $8,942,298. We will continue to carry a deficit until such time, if ever, that we can increase our assets and reduce our significant liabilities which are currently composed of notes payable, accounts payable and accrued expenses. While reducing the working capital deficit is our long-term goal, we do not foresee this occurring in the near future.



Off-Balance Sheet Arrangements

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

Recent Accounting Pronouncements



In July 2006, the Financial Accounting Standards Board (FASB) issued Interpretation No. 48, Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statement No. 109 (FIN No. 48), to create a single model to address accounting for uncertainty in tax positions. FIN No. 48 clarifies the accounting for income taxes by prescribing a minimum recognition threshold in which a tax position be reached before financial statement recognition. FIN No. 48 also provides guidance on de-recognition, measurement, classification, interest and penalties, accounting in interim periods, disclosure and transition. FIN No. 48 is effective for fiscal years beginning after December 15, 2006. The Company adopted FIN No. 48 as of January 1, 2007, as required. The adoption of FIN No. 48 did not have an impact on the Companys financial position and results of operations.



In September 2006, the FASB issued Statement of Financial Accounting Standards (SFAS) No. 157, Fair Value Measurements(SFAS No. 157). SFAS No. 157 defines fair value, establishes a framework for measuring fair value in accordance with generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS No. 157 does not expand the use of fair value in any new circumstances. In February 2008, the FASB issued Staff Position No. FAS 157-1, which amended SFAS No. 157 to exclude SFAS No. 13, Accounting for Leases, and other accounting pronouncements that address fair value measurements for purposes of lease classification or measurement under Statement 13. However, this scope exception does not apply to assets acquired and liabilities assumed in a business combination. Also in February 2008, the FASB issued Staff Position No. FAS 157-2, which delayed the effective date of SFAS No. 157 for non-financial assets and liabilities, except those items recognized at fair value on an annual or more frequently recurring basis to fiscal years beginning after November 15, 2008 and interim periods within those fiscal years. The Company does not expect SFAS No. 157 will have a significant impact on the Companys consolidated financial statements.



In February 2007, the FASB issued SFAS No. 159, Fair Value Option for Financial Assets and Financial Liabilities(SFAS No. 159). SFAS No. 159 permits entities to choose to measure many financial assets and financial liabilities at fair value. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. SFAS No. 159 is effective for fiscal years beginning after November 15, 2007. The Company does not expect SFAS No. 159 will have a significant impact on the Companys consolidated financial statements.



In June 2007, the FASB ratified the consensus on Emerging Issues Task Force (EITF) Issue No. 06-11, Accounting for Income Tax Benefits of Dividends on Share-Based Payment Awards(EITF 06-11). EITF 06-11 requires companies to recognize the income tax benefit realized from dividends or dividend equivalents that are charged to retained earnings and paid to employees for non-vested equity-classified employee share-based payment awards as an increase to additional paid-in capital. EITF 06-11 is effective for fiscal years beginning after September 15, 2007. The adoption is not expected to have a significant impact on the Companys consolidated financial statements.



In June 2007, the FASB ratified the consensus reached on EITF Issue No. 07-3, Accounting for Nonrefundable Advance Payments for Goods or Services Received for Use in Future Research and Development Activities(EITF 07-3), which requires that nonrefundable advance payments for goods or services that will be used or rendered for future research and development activities be deferred and amortized over the period that the goods are delivered or the related services are performed, subject to an assessment of recoverability. EITF 07-3 will be effective for fiscal years beginning after December 15, 2007. The Company does not expect that the adoption of EITF 07-3 will have an impact on the Companys consolidated financial statements.



In December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests in Consolidated Financial Statements(SFAS No. 160) and a revision to SFAS No. 141, Business Combinations(SFAS No. 141R). SFAS No. 160 modifies the accounting for noncontrolling interest in a subsidiary and the deconsolidation of a subsidiary. SFAS No. 141R establishes the measurements in a business combination of the identifiable assets acquired, the liabilities assumed and any noncontrolling interest in the acquiree. Both of these related statements are effective for fiscal



17



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years beginning after December 15, 2008. The Company has not determined the impact that the adoption of these two statements will have on the consolidated financial statements.



In December 2007, the SEC issued Staff Accounting Bulletin 110 (SAB 110), which expresses the views of the Staff regarding use of a simplified method, as discussed in SAB 107, in developing an estimate of expected term of plain vanilla share options in accordance with Statement of Financial Accounting Standards No. 123. SAB 110 will allow, under certain circumstances, the use of the simplified method beyond December 31, 2007 when a Company is unable to rely on the historical exercise data. The Company does not anticipate the adoption of SAB 110 having a material impact on our financial statements.



18



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ITEM 7. FINANCIAL STATEMENTS









Index to Financial Statements



|                                                            |     
|----------------------------------------------------------- | ----
|                                                            | Page
|Report of Independent Registered Public Accounting Firm     | F-2 
|                                                            |     
|Consolidated Balance Sheet                                  | F-3 
|                                                            |     
|Consolidated Statements of Operations                       | F-4 
|                                                            |     
|Consolidated Statements of Changes in Stockholders Deficit | F-5 
|                                                            |     
|Consolidated Statements of Cash Flows                       | F-6 
|                                                            |     
|Notes to the Consolidated Financial Statements              | F-8 





F-1



---

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM





To the Board of Directors and Stockholders

Cord Blood America, Inc.





We have audited the accompanying consolidated balance sheet of Cord Blood America, Inc. and Subsidiaries as of December 31, 2007, and the related consolidated statements of operations, changes in stockholders deficit, and cash flows for the years ended December 31, 2007 and 2006.  These consolidated financial statements are the responsibility of the Companys management.  Our responsibility is to express an opinion on these consolidated financial statements based on our audits.



We conducted our audits in accordance with the standards established by 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.  The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting.  Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Companys internal control over financial reporting.  Accordingly, we express no such opinion.  An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, 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, 2007, and the results of their operations and their cash flows for the years ended December 31, 2007 and 2006, in conformity with accounting principles generally accepted in the United States of America.



The accompanying consolidated 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 sustained recurring operating losses, continues to consume cash in operating activities, and has insufficient working capital and an accumulated deficit at December 31, 2007.  These conditions raise substantial doubt about the Company's ability to continue as a going concern. Management's plans regarding those matters also are described in Note 2.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.









Rose, Snyder & Jacobs

A Corporation of Certified Public Accountants



Encino, California



April 14, 2008



F-2



---

CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEET

AS OF DECEMBER 31, 2007



|                                                                                     |                                                                                                          |                                             |              |            
|------------------------------------------------------------------------------------ | -------------------------------------------------------------------------------------------------------- | ------------------------------------------- | ------------ | -----------
|ASSETS                                                                              
|Current assets:                                                                      |                                                                                                          |                                            
|                                                                                     | Cash                                                                                                     |                                             | $            | 338,828    
|                                                                                     | Accounts receivable, net of allowance for doubtful accounts of $35,000                                   |                                             | 92,559      
|                                                                                     | Prepaid expenses                                                                                         |                                             | 67,544      
|                                                                                     | Supplies                                                                                                 |                                             | 5,345       
|                                                                                     |                                                                                                          | Total current assets                        |              | 504,276    
|Property and equipment, net of accumulated depreciation and amortization of $204,806 |                                                                                                          | 138,370                                    
|Deposits                                                                             |                                                                                                          |                                             | 10,683      
|Customer contracts and relationships, net of amortization of $438,533                |                                                                                                          | 4,868,967                                  
|Deferred financing costs                                                             |                                                                                                          | 1,210,109                                  
|Domain name, net of amortization of $73                                              |                                                                                                          | 326                                        
|Other assets                                                                         |                                                                                                          | 670                                        
|                                                                                     |                                                                                                          | Total assets                                | $            | 6,733,401  
|LIABILITIES AND STOCKHOLDERS DEFICIT                                               
|Current liabilities:                                                                 |                                                                                                          |                                            
|                                                                                     | Accounts payable                                                                                         | $                                           | 999,393     
|                                                                                     | Accrued expenses                                                                                         |                                             | 1,830,809   
|                                                                                     | Deferred revenue                                                                                         |                                             | 1,043,260   
|                                                                                     | Due to stockholders                                                                                      |                                             | 188,955     
|                                                                                     | Capital lease obligations                                                                                |                                             | 3,734       
|                                                                                     | Derivatives Liability                                                                                    |                                             | 1,309,854   
|                                                                                     | Promissory notes payable, net of unamortized discount of $4,086,914                                      |                                             | 4,523,533   
|                                                                                     |                                                                                                          | Total current liabilities                   |              | 9,899,538  
|Stockholders deficit:                                                               |                                                                                                          |                                            
|                                                                                     | Preferred stock, $.0001 par value, 5,000,000 shares authorized, no shares issued and outstanding         |                                             | --          
|                                                                                     | Common stock, $.0001 par value, 300,000,000 shares authorized, 195,558,923 shares issued and outstanding |                                             | 19,569      
|                                                                                     | Additional paid-in capital                                                                               |                                             | 31,985,408  
|                                                                                     | Common stock held in treasury, 46,266,667 shares                                                         |                                             | (17,159,833)
|                                                                                     | Accumulated deficit                                                                                      |                                             | (18,011,281)
|                                                                                     |                                                                                                          | Total stockholders deficit                 |              | (3,166,137)
|                                                                                     |                                                                                                          | Total liabilities and stockholders deficit | $            | 6,733,401  



See the accompanying notes to consolidated financial statements.



F-3



---





CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF OPERATIONS

FOR THE YEARS ENDED DECEMBER 31, 2007 AND 2006



|                                           |                         |             |      |   |            
|------------------------------------------ | ----------------------- | ----------- | ---- | - | -----------
|                                           | Year Ended December 31,
|                                           | 2007                    |             | 2006
|                                           |                         |             |      |   |            
|Revenue                                    | $                       | 5,811,267   |      | $ | 3,328,336  
|Cost of services                           |                         | 3,838,018   |      |   | 3,047,423  
|Gross Profit                               |                         | 1,973,249   |      |   | 280,913    
|                                           |                         |             |      |   |            
|Administrative and selling expenses        |                         | 5,883,998   |      |   | 3,816,565  
|                                           |                         |             |      |   |            
|Loss from operations                       |                         | (3,910,749) |      |   | (3,535,652)
|                                           |                         |             |      |   |            
|Interest expense                           |                         | (2,083,255) |      |   | (2,112,505)
|Other income                               |                         | 0           |      |   | 2,755      
|                                           |                         |             |      |   |            
|Net loss before income taxes               |                         | (5,994,004) |      |   | (5,645,402)
|                                           |                         |             |      |   |            
|Income taxes                               |                         | 0           |      |   | 0          
|                                           |                         |             |      |   |            
|Loss from Continuing Operations            |                         | (5,994,004) |      |   | (5,645,402)
|Discontinued Operations (see Note 14)      |                         | (0)         |      |   | (43,330)   
|Net Loss                                   | $                       | (5,994,004) |      | $ | (5,688,732)
|Basic and diluted loss per share:          |                         |             |      |   |            
|Continuing operations                      | $                       | (0.04)      |      | $ | (0.14)     
|Discontinued operations                    |                         | (0.00)      |      |   | (0.00)     
|Net Loss                                   | $                       | (0.04)      |      | $ | (0.14)     
|Weighted average common shares outstanding |                         | 141,940,070 |      |   | 41,469,655 



See the accompanying notes to consolidated financial statements.



F-4



---

CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS DEFICIT

YEARS ENDED DECEMBER 31, 2007 AND 2006





|                                                                      |              |  |                            |        |                |   |                     |       |              |  |   |              |  |   |            
|--------------------------------------------------------------------- | ------------ |  | -------------------------- | ------ | -------------- | - | ------------------- | ----- | ------------ |  | - | ------------ |  | - | -----------
|                                                                      | Common Stock |  | Additional Paid-in Capital |        | Treasury Stock |   | Accumulated Deficit |       |              | 
|                                                                      | Shares       |  | Amount                     |        |                |   |                     | Total
|                                                                      |              |  |                            |        |                |   |                     |       |              |  |   |              |  |   |            
|Balance, December 31, 2005                                            | 73,471,857   |  | $                          | 7,347  |                | $ | 16,448,476          |       | (11,560,000) |  | $ | (8,136,851)  |  | $ | (3,241,028)
|Shares Issued to vendor                                               | 2,500,000    |  |                            | 250    |                |   | 349,750             |       |              |  |   |              |  |   | 350,000    
|Issuance of common stock upon loan conversion                         | 818,794      |  |                            | 82     |                |   | 74,918              |       | -            |  |   | -            |  |   | 75,000     
|Shares Issued for Cryobank asset purchase                             | 703,518      |  |                            | 70     |                |   | 139,930             |       | -            |  |   | -            |  |   | 140,000    
|Stock issued for services                                             | 321,270      |  |                            | 32     |                |   | 49,218              |       | -            |  |   | -            |  |   | 49,250     
|Shares issued in connection with debt                                 | 500,000      |  |                            | 50     |                |   | 59,950              |       | -            |  |   | -            |  |   | 60,000     
|Shares issued in connection with modification of debt terms           | 1,239,000    |  |                            | 124    |                |   | 136,166             |       |              |  |   |              |  |   | 136,290    
|Shares issued as deposit on CorCell acquisition                       | 2,563,636    |  |                            | 256    |                |   | 299,744             |       |              |  |   |              |  |   | 300,000    
|Share based compensation                                              |              |  |                            |        |                |   | 251,313             |       |              |  |   |              |  |   | 251,313    
|Shares issued as fees in connection with raising capital              | 1,000,000    |  |                            | 100    |                |   | 90,900              |       |              |  |   |              |  |   | 91,000     
|Treasury shares                                                       | 5,000,000    |  |                            | 500    |                |   | 4,999,500           |       | (5,000,000)  |  |   |              |  |   | -          
|Amortization of warrants expense                                      | -            |  |                            | -      |                |   | 1,260,862           |       | -            |  |   | -            |  |   | 1,260,862  
|Net Loss                                                              | -            |  |                            | -      |                |   | -                   |       | -            |  |   | (5,688,732)  |  |   | (5,688,732)
|Balance, December 31, 2006                                            | 88,118,075   |  |                            | 8,811  |                |   | 24,160,727          |       | (16,560,000) |  |   | (13,825,583) |  |   | (6,216,045)
|Reclassification of derivative liability upon issuance of FSP 00-19-2 |              |  |                            |        |                |   |                     |       |              |  |   | 1,808,306    |  |   | 1,808,306  
|Shares issued for services                                            | 47,058,136   |  |                            | 4,706  |                |   | 2,419,546           |       |              |  |   |              |  |   | 2,424,252  
|Shares issued for CorCell acquisition                                 | 18,694,795   |  |                            | 1,883  |                |   | 1,915,511           |       |              |  |   |              |  |   | 1,917,394  
|Issuance of common shares for debt conversion                         | 18,834,092   |  |                            | 1,883  |                |   | 1,071,033           |       |              |  |   |              |  |   | 1,072,916  
|Shares issued for CureSource acquisition                              | 196,080      |  |                            | 20     |                |   | 9,980               |       |              |  |   |              |  |   | 10,000     
|Issuance of warrants                                                  |              |  |                            |        |                |   | 830,717             |       |              |  |   |              |  |   | 830,717    
|Share-based compensation                                              | 2,368,336    |  |                            | 237    |                |   | 227,234             |       |              |  |   |              |  |   | 227,471    
|Shares issued for financing                                           | 12,122,742   |  |                            | 1212   |                |   | 630,867             |       |              |  |   |              |  |   | 632,079    
|Share-based compensation                                              |              |  |                            |        |                |   | 8,275               |       |              |  |   |              |  |   | 8,275      
|Treasury shares                                                       | 8,166,667    |  |                            | 817    |                |   | 599,016             |       | (599,833)    |  |   |              |  |   | -          
|Reclassification of derivative liability upon conversion of debt      |              |  |                            |        |                |   | 112,502(            |       |              |  |   |              |  |   | 112,502    
|Net Loss                                                              |              |  |                            |        |                |   |                     |       |              |  |   | (5,994,004)  |  |   | (5,994,004)
|Balance, December 31, 2007                                            | 195,558,923  |  | $                          | 19,569 |                | $ | 31,985,408          |       | (17,159,833) |  | $ | (18,011,281) |  | $ | (3,166,137)



See the accompanying notes to consolidated financial statements.



F-5



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CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2007 AND 2006



|                                                                           |      |             |      |   |            
|-------------------------------------------------------------------------- | ---- | ----------- | ---- | - | -----------
|                                                                           | 2007 |             | 2006
|Cash Flows from Operating Activities                                       |      |             |      |   |            
|Net Loss                                                                   | $    | (5,994,004) |      | $ | (5,688,732)
|Adjustments to reconcile net loss to net cash used in operating activities |      |             |      |   |            
|Issuance of stock for services                                             |      | 2,299,893   |      |   | 535,540    
|Excess value of derivative liability over related loan proceeds            |      | 2,091,489   |      |   | -          
|Amortization of deferred financing costs                                   |      | 217,623     |      |   | -          
|Amortization of loan discount                                              |      | 2,742,498   |      |   | 1,426,646  
|Share based compensation                                                   |      | 227,471     |      |   | 251,313    
|Provision for uncollectible accounts                                       |      | 24,900      |      |   | 19,420     
|Depreciation and amortization                                              |      | 521,856     |      |   | 39,752     
|Change in value of derivative liability                                    |      | (4,663,638) |      |   | -          
|Loss on disposal of assets                                                 |      | -           |      |   | 16,354     
|Changes in operating assets and liabilities                                |      |             |      |   |            
|Accounts receivable                                                        |      | 279,862     |      |   | 89,867     
|Supplies                                                                   |      | 10,343      |      |   | -          
|Prepaid expenses                                                           |      | 58,686      |      |   | 6,729      
|Deposits                                                                   |      | 12,250      |      |   | -          
|Deferred costs                                                             |      | (74,886)    |      |   | -          
|Accounts payable                                                           |      | 91,193      |      |   | 663,023    
|Accrued expenses                                                           |      | 920,080     |      |   | 403,344    
|Deferred revenue                                                           |      | (27,993)    |      |   | 30,767     
|                                                                           |      |             |      |   |            
|                                                                           |      |             |      |   |            
|Net cash used in operating activities                                      |      | (1,262,377) |      |   | (2,205,977)
|Cash Flows from Investing Activities                                       |      |             |      |   |            
|Purchase of property and equipment                                         |      | (2,937)     |      |   | (16,083)   
|Acquisition of Cryobank                                                    |      | -           |      |   | (120,000)  
|Acquisition of CorCell business                                            |      | (1,878,047) |      |   | --         
|Acquisition of CureSource                                                  |      | (106,500)   |      |   | -          
|Net cash used in investing activities                                      |      | (1,987,484) |      |   | (136,083)  
|Cash Flows from Financing Activities                                       |      |             |      |   |            
|Proceeds from the issuance of notes payable                                |      | 3,612,685   |      |   | 415,000    
|Payments on notes payable                                                  |      | (821,705)   |      |   | (31,794)   
|Payments on capital lease obligations                                      |      | (6,381)     |      |   | (804)      
|Proceeds from advances from shareholders                                   |      | 246,408     |      |   | 15,974     
|Payments on advances from shareholders                                     |      | (102,636)   |      |   | (49,937)   
|Proceeds from issuance of common stock                                     |      | 638,752     |      |   | -          
|                                                                           |      |             |      |   |            
|Net cash provided by financing activities                                  |      | 3,567,123   |      |   | 348,439    
|                                                                           |      |             |      |   |            
|                                                                           |      |             |      |   |            
|Net  increase (decrease) in cash and cash equivalents                      |      | 317,262     |      |   | (1,993,621)
|                                                                           |      |             |      |   |            
|Cash and Cash Equivalents, beginning of year                               |      | 21,566      |      |   | 2,015,187  
|                                                                           |      |             |      |   |            
|Cash and Cash Equivalents, end of year                                     | $    | 338,828     |      | $ | 21,566     



See the accompanying notes to consolidated financial statements.



F-6



---

CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31, 2007 AND 2006



|                                                                       |      |           |      |   |        
|---------------------------------------------------------------------- | ---- | --------- | ---- | - | -------
|                                                                       | 2007 |           | 2006
|Supplemental disclosure of cash flow information:                      |      |           |      |   |        
|Cash paid for interest                                                 | $    | 749,093   |      | $ | 1,482  
|Supplemental Schedule of Non-Cash Investing and Financing Activities:  |      |           |      |   |        
|Issuance of common shares in connection with acquisition of CorCell    | $    | 1,917,394 |      | $ |      
|Issuance of common shares in connection with acquisition of CureSource | $    | 10,000    |      | $ |      
|Conversion of debt into common shares                                  |      | 822,916   |      |   |        
|Payment of notes payable with common shares                            |      | 250,000   |      |   |        
|Payment of accounts payable with common shares                         |      | 205,196   |      |   |        
|Shares issued for purchase of Cryobank assets                          | $    |           |      | $ | 140,000
|Shares issued for debt issuance costs                                  | $    | 244,683   |      | $ | 60,000 
|Shares issued to vendors                                               | $    |           |      | $ | 350,000
|Shares issued as deposit for CorCell                                   | $    |           |      | $ | 300,000
|Shares issued as fees for raising capital                              | $    |           |      | $ | 91,000 



See the accompanying notes to consolidated financial statements.



F-7



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CORD BLOOD AMERICA, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2007



Note 1. Organization and Description of Business



Cord Blood America, Inc. ("CBAI"), formerly D&A Lending, Inc., was incorporated in the State of Florida on October 12, 1999. CBAI's headquarters are located in Los Angeles, California. CBAI is primarily a holding company whose subsidiaries include Cord Partners, Inc. (Cord), CorCell Co. Inc., CorCell Ltd., CBA Professional Services, Inc. D/B/A BodyCells, Inc. ("BodyCells"), CBA Properties, Inc. ("Properties"), Career Channel Inc, D/B/A Rainmakers International ("Rain"), and Family Marketing, Inc. ("Family"). CBAI and its subsidiaries engage in the following business activities:



·

Cord specializes in providing private cord blood stem cell preservation services to families.



·

BodyCells is a developmental stage company and intends to be in the business of collecting, processing and preserving peripheral blood and adipose tissue stem cells allowing individuals to privately preserve their stem cells for potential future use in stem cell therapy.



·

Properties was formed to hold the corporate trademarks and other intellectual property of CBAI.



·

Rain specializes in creating direct response television, radio, on-hold and motor sports advertising campaigns, including media placement and commercial production.



·

Family specialized in delivering leads through internet based lead generation to corporate customers in the business of family based products and services. Family was disposed of through a sale, which was completed in the third quarter of 2006. (see Note 14, Discontinued Operations)



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. The accompanying financial statements do not include any adjustments relating to the recoverability and classification of assets and liabilities that may be necessary in the event CBAI cannot continue as a going concern. CBAI continues to search for additional capital to allow it to focus on successfully reaching its objectives and being profitable.



Note 2. Summary of Significant Accounting Policies



Basis of Presentation and Going Concern

The accompanying financial statements of Cord Blood America, Inc. and its subsidiaries have been prepared in accordance with accounting principles generally accepted in the United States of America, which contemplate continuation of the Company as a going concern. CBAI has experienced recurring net losses from operations, which losses have caused an accumulated deficit of approximately $18 million as of December 31, 2007. In addition, CBAI has consumed cash in its operating activities of approximately $1,262,377 for the year ending December 31, 2007 and has a working capital deficit of $8,942,298 as of December 31, 2007. These factors, among others, raise substantial doubt about CBAI's ability to continue as a going concern.



Management has been able, thus far, to finance the losses and the growth of the business, through private placements of its common stock, the issuance of debt and proceeds from the Equity Distribution Agreement and Securities Purchase Agreement, and expects to continue to raise funds through debt and equity instruments. CBAI is continuing to attempt to increase revenues within its core businesses. In addition, CBAI is exploring alternate ways of generating revenues through acquiring other businesses in the stem cell industry. In addition, the Company has taken steps to reduce its overall spending through the reduction of headcount. The ongoing execution of CBAI's business plan is expected to result in operating losses over the next twelve months. There are no assurances that CBAI will be successful in achieving its goals of increasing revenues and reaching profitability.



In view of these conditions, CBAI's ability to continue as a going concern is dependent upon its ability to meet its financing requirements, and to ultimately achieve profitable operations. Management believes that its current and future plans provide an opportunity to continue as a going concern. The accompanying consolidated financial statements do not include any adjustments relating to the recoverability and classification of recorded assets, or the amounts and classification of liabilities that may be necessary in the event CBAI cannot continue as a going concern.



Principles of Consolidation



The consolidated financial statements include the accounts of CBAI and its wholly owned subsidiaries, Cord, BodyCells, Properties, Rain and Family. Significant inter-company balances and transactions have been eliminated upon consolidation.



Estimates



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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 date of the financial statements and the reported amount of revenues and expenses during the reporting periods. Actual results could differ materially from those estimates.



Accounts Receivable



Accounts receivable consist of the amounts due for the processing and storage of umbilical cord blood, advertising, commercial production and internet lead generation. Accounts receivable relating to deferred revenues are netted against deferred revenues for presentation purposes. The allowance for doubtful accounts is estimated based upon historical experience. The allowance is reviewed periodically and adjusted for accounts deemed uncollectible by management. Amounts are written off when all collection efforts have failed.



Property and Equipment



Property and equipment are stated at cost less accumulated depreciation. Depreciation is computed on a straight-line basis 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. 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.



Intangible Assets



Intangible assets include primarily customer contracts and relationships as part of the acquisition of the CorCell and CureSource assets in 2007 (Note 3). Intangible assets are stated at cost. Amortization of intangible assets is computed using the sum of the years digits method, over an estimated useful life of 18 years. Estimated amortization expense for the next five years is as follows: 2008:$439,000; 2009: $413,000; 2010: $387,000; 2011: $361,000; 2012: $335,000.



Impairment of Long-Lived Assets



Long-lived assets, other than goodwill, are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the assets might not be recoverable. Conditions that would necessitate an impairment assessment include a significant decline in the observable market value of an asset, a significant change in the extent or manner in which an asset is used, or a significant adverse change that would indicate that the carrying amount of an asset or group of assets is not recoverable. For long-lived assets to be held and used, the Company recognizes an impairment loss only if its carrying amount is not recoverable through its undiscounted cash flows and measures the impairment loss based on the difference between the carrying amount and fair value.



Deferred Revenue



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



Valuation of Derivative Instruments



SFAS No. 133 Accounting for Derivative Instruments and Hedging Activities requires that embedded derivative instruments be bifurcated and assessed, along with free-standing derivative instruments such as warrants, on their issuance date and in accordance with EITF 00-19 Accounting for Derivative Financial Instruments Indexed to, and Potentially Settled in, a Companys Own Stock to determine whether they should be considered a derivative liability and measure at their fair value for accounting purposes. In determining the appropriate fair value, the Company uses the Black-Scholes option pricing formula. At December 31, 2007, the Company adjusted its derivative liability to its fair value, and reflected the increase in fair value of $4,663,638 in its statement of operations, as a reduction of interest expense.



Revenue Recognition



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



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



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Rain generates revenue from packaged advertising services, including media buying, on-hold and motor sports advertising campaigns, marketing and advertising production services. Rain's advertising service revenue is recognized when the media ad space is sold and the advertising occurs. Rain's advertising production service revenue is derived through the production of an advertising campaign including, but not limited to, audio and video production, establishment of a target market and the development of an advertising campaign. Rain recognizes revenue generated from packaged advertising services provided to our clients using the "Gross" basis of Emerging Issues Task Force No. 99-19, "Reporting Revenue Gross as a Principal versus Net as an Agent", (EITF 99-19).



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



Cost of Services



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



Advertising



Advertising costs are expensed when incurred. Advertising expense totaled approximately $425,000 and $756,000 for the years ended December 31, 2007 and 2006, respectively.



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. The measurement of deferred tax assets is reduced, if necessary, by a valuation allowance based on the portion of tax benefits that more likely than not will not be realized. There was a valuation allowance equal to 100% of deferred tax assets as of December 31, 2007.



Accounting for Stock Option Plan



The Companys share-based employee compensation plans are described in Note 10. On January 1, 2006, the Company adopted SFAS 123(R), Accounting for Stock-based Compensation (Revised 2004) (123(R)), which requires the measurement and recognition of compensation expense for all share-based payment awards made to employees, non-employee directors, and consultants, including employee stock options. SFAS 123(R) supersedes the Companys previous accounting under APB 25 and SFAS 123, for periods beginning in fiscal 2006. In March 2005, the Securities and Exchange Commission issued SAB 107 relating to SFAS 123(R). The Company has applied the provisions of SAB 107 in its adoption of SFAS 123(R).



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 141,940,070 and 41,469,655 for the years ended December 31, 2007 and 2006, respectively. Outstanding options to acquire common stock and warrants are not included in the computation of net loss per common share because the effects of inclusion are anti-dilutive.



Reclassification



Certain numbers in the prior year have been reclassified to conform to the current years presentation.



F-10



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Concentration of Risk



Credit risk represents the accounting loss that would be recognized at the reporting date if counterparties failed completely to perform as contracted. Concentrations of credit risk (whether on or off balance sheet) that arise from financial instruments exist for groups of customers or counterparties when they have similar economic characteristics that would cause their ability to meet their contractual obligations to be similarly affected by changes in economic or other conditions described below.



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



Financial instruments that subject the Company to credit risk could consist of cash balances maintained in excess of federal depositary insurance limits. The Company maintains its cash and cash equivalent balances with high credit quality financial institutions. At times, cash and cash equivalent balances may be in excess of Federal Deposit Insurance Corporation limits. To date, the Company has not experienced any such losses, and believes it is not exposed to any credit risk related to such balances.



Note 3. Acquisitions



Acquisition of CorCell



On October 13, 2006, the Company entered into an agreement with CorCell, Inc. under which CBAI started the process of acquiring the CorCell Business of collection, processing and storage of blood taken from umbilical cord after a child is born . On February 28, 2007, the Company completed the acquisition of certain assets from CorCell, Inc., (a Delaware Company) a subsidiary of Vita34 A.G., in exchange for $ 1,878,047 in cash, two promissory notes totaling $462,959 in addition to $300,000 of shares previously issued in 2006, $1,917,394 value paid in common restricted shares of the Company and the assumption of net liabilities in the amount of $1,093,978. The Acquisition related to all rights to possession and custody of all acquired samples owned by CorCell, Inc., and associated with the operations of CorCell, Inc. which is predominantly the current customer base and revenues. The deal also included the purchase of cryogenic freezers and other fixed assets used in this umbilical cord blood samples business.

The purchase price was allocated as follows:



|                     |   |          
|-------------------- | - | ---------
|Accounts receivable  | $ | 352,234  
|Fixed assets         |   | 224,979  
|Other current assets |   | 141,258  
|Customer list        |   | 4,935,236
|                     |   |          
|Total purchase price | $ | 5,653,707



Acquisition of the Assets of CureSource, Inc.



On August 20, 2007, CBAI completed the acquisition of certain assets from CureSource, Inc., a South Carolina corporation for the purchase price of $106,500 in cash and $10,000 in stock, or 196,080, unregistered shares of CBAI's common stock (the "Acquisition"). The Acquisition related to the purchase of approximately 340 umbilical cord blood samples, as well as one cryogenic freezer used for the storage of such umbilical cord blood samples. The entire purchase price was allocated to customer contracts and relationships, which are being amortized over 18 years.



Note 4. Property and Equipment



At December 31, 2007, property and equipment consist of:



|                              |                     |  |   |          
|----------------------------- | ------------------- |  | - | ---------
|                              | Useful Life (Years) |  |   |          
|                              |                     |  |   |          
|Furniture and fixtures        | 5                   |  | $ | 69,477   
|Computer equipment            | 3                   |  |   | 116,396  
|Freezer equipment             | 2                   |  |   | 157,303  
|                              |                     |  |   | 343,176  
|Less accumulated depreciation |                     |  |   | (204,806)
|                              |                     |  |   |          
|                              |                     |  | $ | 138,370  



For the years ended December 31, 2007 and 2006, depreciation expense totaled $103,332 and $19,669 respectively.





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Note 5. Accrued Expenses



The components of accrued expenses at December 31, 2007 are summarized as follows:



|                                                |   |          
|----------------------------------------------- | - | ---------
|Accrued salaries and benefits                   | $ | 53,801   
|Accrued interest and related financing expenses |   | 1,633,199
|Other accrued expenses                          |   | 128,309  
|Deferred Rent                                   |   | 15,500   
|                                                | $ | 1,830,309



Note 6. Capital Lease Obligations



Through December 31, 2007, Cord Blood entered into capital leases for computer equipment. The capital leases expire at various dates in 2008 and 2009. Assets under capital lease are capitalized using interest rates appropriate at

the inception of the lease. At December 31, 2007 and 2006, these leased assets are included in property and equipment as computer equipment amounting to $13,420 and $13,420 respectively.



Note 7. Notes and Loans Payable, and Derivative Liabilities



At December 31, 2007, notes and loans payable consist of:



|                                                                                                                                                                                                    |   |          
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ---------
|Secured Convertible Debenture payable to Cornell Capital Partners, secured by substantially all of the Company's assets, interest at 10% per annum, principal and interest due on December 23, 2008 | $ | 1,534,250
|Secured Convertible Debenture payable to Enable Capital, secured by substantially all of the Company's assets, interest at 10% per annum, principal and interest due on December 23, 2008           |   | 2,311,250
|Promissory Note payable to Strategic Working Capital Fund, L.P., interest at 8% per annum, due August 2, 2008                                                                                       |   | 317,232  
|0% Convertible Debenture payable to Enable Capital, effective interest rate of 72% per annum (considering the loan discount), repayable in eighteen monthly installments, commencing May, 2008      |   | 1,931,105
|Secured Original Discount Debenture payable to Shelter Island Opportunity Fund, LLP, interest at 11.25% per annum,  27 equal payments remaining, maturing in March, 2010                            |   | 2,055,492
|2nd Secured Discount Debenture payable to Shelter Island Opportunity Fund, LLP, interest at 11.25% per annum,  4 equal payments remaining, maturing in April, 2008                                  |   | 153,333  
|Advance on credit card sales                                                                                                                                                                        |   | 3,050    
|Convertible Note payable to CorCell, Inc., interest at 8% per annum, repayable in six equal monthly instal

l

ments, commencing in December 2007                                                   |   | 212,959  
|Promissory Note payable to CorCell, Inc., interest at 10.5% per annum, due March, 2008                                                                                                              |   | 91,776   
|                                                                                                                                                                                                    |   | 8,610,447
|Less: Unamortized Discount                                                                                                                                                                          |   | 4,086,914
|                                                                                                                                                                                                    |   |          
|                                                                                                                                                                                                    | $ | 4,523,533



Following are the significant terms of the above notes and loans payable:



Cornell



On June 27, 2006, CBAI entered into an agreement with Cornell. The agreement amends certain terms of the SP Agreement, the Registration Rights Agreement and the Pledge and Escrow Agreement entered into on September 9, 2005. Pursuant to the agreement, the following changes were agreed to by both parties. First, the time for CBAI to increase its authorized common stock to 200 million was extended to August 18, 2006. Second, the deadline for CBAI to have the second Registration Statement declared effective by the SEC was extended to September 30, 2006. Third, CBAI waived the Conversion Restriction which restricts Cornell from converting any amounts of the outstanding principal of the Debentures at the Market Conversion Price prior to September 9, 2006. Fourth, in the event that CBAI does not have a sufficient number of authorized shares of Common Stock to issue Conversion Shares upon a conversion of the Debentures, CBAI is thereby authorized to issue to Cornell such number of shares otherwise reserved as Pledge Shares to Cornell and reduce the number of Pledged Shares by the amount of such issuance. The number of shares included in the amended registration statement has been reduced to 55,840,448.



On October 13, 2006, CBAI entered into an agreement with Cornell. The agreement adjusts certain terms as a result of such issuances by the company described below: Secured Convertible Debenture issued on September 9, 2005; Secured Convertible Debenture issued on December 23, 2005; Common Stock Purchase Warrant issued September 9, 2005; Common Stock Purchase Warrant issued September 9, 2005; Common Stock Purchase Warrant issued September 9, 2005; Pursuant to the agreement, the following changes have been agreed to by both parties: The Conversion Price (as defined in the Convertible Debentures) shall be adjusted pursuant to Section 3(c)(iv) of the convertible debentures such that the Conversion Price in effect from this date forward shall be equal to $0.101 per share. The conversion price calculated as a 4% discount



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based on the stock price remained unchanged. The Warrant Exercise Price and the number of Warrant Shares (each as defined in the warrants) shall be adjusted pursuant to Section 8(a) of the Warrant such that the Warrant Exercise Price in effect from this date forward shall be equal to $0.101 per share. All other terms and conditions of the referenced agreements remain unchanged. In addition, Cornell converted $25,000 of its Note in exchange for CBAI issuing 299,043 common shares from treasury at a share price of $0.084.



On December 8, 2006, Cornell converted a further $50,000 of its Note in exchange for CBAI issuing 519,751 common shares from treasury at a share price of $0.0962. At December 31, 2006, the outstanding balance on the Note payable to Cornell was $4,925,000.



During 2007, Cornell converted $822,916 of its debt into 13,339,629 shares of common stock of the Company, and was repaid $250,000 in shares of common stock.



Liquidated damages in the amount of $1,227,300 have been accrued for an event of default under the terms of this note, and are recorded as accrued expenses at December 31, 2007.



The conversion feature of these debentures is recorded as a derivative liability under EITF 00-19.  The Black Scholes value of the conversion feature was $284,340 at December 31, 2007.



Warrants issued in connection with these debentures were also considered derivative liabilities, but with the issuance of  FSP 00-19-2, and the sequencing of awards under paragraph 11 of EITF 00-19, these warrants no longer qualified as derivative liabilities, and were reclassified to retained earnings at January 1, 2007.



Strategic



On August 2, 2006, CBAI entered into a Subscription Agreement with Strategic Working Capital Fund, L.P. ("Strategic"). Pursuant to the Subscription Agreement, CBAI (i) issued to Strategic a Promissory Note bearing interest at the rate of 8% with an aggregate principal amount of $285,000 and (ii) delivered 500,000 unregistered shares of its Common Stock (the "Shares") to Strategic. The Promissory Note is due one year from the date of issuance, unless redeemed prior by Strategic but in any event no earlier than the third month following issuance of the note. The Promissory Note also is subject to acceleration upon an event of default, as defined in the Note. Pursuant to the Subscription Agreement, Strategic was granted registration rights for the Shares in the event that CBAI proposes to register any other shares of its common stock.



On December 5, 2006, CBAI issued 1,239,000 restricted common shares in exchange for Strategic providing a three month extension on the promissory note.  As of December 31, 2007 the outstanding balance on the note including accrued and unpaid interest was $317,232.



Advance on Credit Card Sales



On September 5, 2006, Cord received a $93,000 advance on future credit card sales. Repayment terms on this advance call for the 20% capture of certain credit card sales until the sum of $130,200 has been paid. At December 31, 2007, the outstanding principal balance was $3,050.



Convertible Note Payable  Enable



In November 2007, the Company contracted a 0% convertible debenture with Enable Capital for a face amount of $1,931,106, and net proceeds of $1,369,000.  The note is convertible at $0.03 per share or 96% of market price as defined. The Company used $544,000 of the proceeds to pay down its accrued interest to Cornell.  In connection with this convertible note, the Company issued a warrant to purchase 48,277,655 shares of the Companys common stock at an exercise price of $0.037 per share.  The Company performed an analysis under EITF 00-19, and found that the conversion feature and the related warrants do not qualify as derivative liabilities.  Therefore, the Company applied the provisions of APB 14, EITF 98-5 and 00-27.  $602,361 of the proceeds was allocated to the debt, while $830,717 was allocated to the warrants.    The value of the warrants was established using the Black-Scholes pricing model with the following assumptions: expected life of 5 years; stock volatility of 163%, risk-free interest rate of 3.23%, and no dividend.  With the consideration of the loan discount of $1,328,745, the interest rate is 72%.  In connection with this financing, warrants to purchase 5,833,334 shares of stock were issued to Midtown Partners.  These warrants were valued at $219,175, and were recorded as deferred financing costs.



In November 2007, Enable Capital also assumed $2,311,250 of the note payable to Cornell.



Note Payable - Shelter Island.



In February 2007, as part of the financing for the CorCell acquisition, the Company contracted a note payable in the amount of $2,300,000 with Shelter Island, for proceeds of $2,000,000.  In connection with this note, the Company also issued warrants to purchase 36,000,000 shares of common stock at a price of $0.05 per share.  In connection with this financing, the placement agent was paid $75,000 and was issued warrants to purchase 4,000,000 shares of the Companys common stock.  The Company also contracted another agreement with Shelter Island, for which it has not yet obtained the proceeds.  In connection with this agreement, the Company has issued warrants to purchase 20,270,270 shares of common stock at $0.037 per share.  The Company conducted an analysis under EITF 00-19, and accounted for the warrants as derivative



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liabilities.  The total value of warrants was $5,310,142 at the date of issuance, using the Black-Scholes pricing model with the following assumptions: expected life of 5 years; stock volatility of 163%, risk-free interest rate of 3.23%, and no dividend.  $2,000,000 of these warrants were recorded as loan discount, $1,218,653 was recorded as deferred financing costs to be amortized on a straight line basis over the life of the loan, and $2,091,489 was recorded as interest expense, representing the excess of the derivative liability over the amount of the note.



Note Payable - CorCell



In March 2007, the Company contracted a $212,959 note payable with CorCell, in connection with the acquisition of the CorCell business.  In connection with this note, the Company issued warrants to purchase shares of common stock at a price of $0.05 per share.  The Company conducted an analysis under EITF 00-19, and accounted for the warrants as derivative liabilities.  The total value of warrants was $125,401 at the date of issuance, using the Black-Scholes pricing model with the following assumptions: expected life of 5 years; stock volatility of 165%, risk-free interest rate of 5.11%, and no dividend.



The Company recorded a change in value of derivative liability of $4,663,638 for the year ended December 31, 2007, and reclassified $112,502 of derivative liability to equity with respect to the conversion feature of the portion of the convertible note with Cornell that has been converted during the year.



Note 8. Commitments and Contingencies



Agreements



Progenitor Cell Therapy, LLC

On August 1, 2007, CBAI entered into an agreement with Progenitor Cell Therapy, LLC (PCT) for testing, processing and storage of cord blood samples.  As a result of our agreement with PCT we terminated our agreement with Bergen.  The Company believes this transition from Bergen to PCT will provide additional leverage to operating costs and efficiencies while maintaining the highest of quality standards. This agreement expires on June 30, 2012. There is a 90 day written advance for early termination where depending on the party terminating, various clauses to termination apply.



Pharmastem

In March 2004, Cord entered into a Patent License Agreement with the holder of patents utilized in the collection, processing, and storage of umbilical cord blood to settle litigation against Cord for alleged patent infringements. The

Patent License Agreement calls for royalties of 15% of processing and storage revenue, with a minimum royalty of $225 per specimen collected, on all specimens collected after January 1, 2004 until the patents expire in 2010. During the year ended December 31, 2007 and 2006, Cord incurred $89,102 and $211,395 respectively, in royalties to the Patent License Agreement. At December 31, 2007, $246,446 is included in accounts payable and accrued expenses relating to these fees.



Operating Leases

CBAI leases office space, computer software and office equipment which expires at various times through 2012. Commitments for minimum future rental payments, by year and in the aggregate, to be paid under the operating leases as of December 31, 2007, are as follows:



|     |   |        
|---- | - | -------
|2008 | $ | 187,389
|2009 |   | 184,050
|2010 |   | 147,968
|2011 |   | 146,685
|2012 |   | 140,764
|     | $ | 806,856



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 $10,077, 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 $277,282 and $120,527 for the years ended December 31, 2007 and 2006, respectively.



Employment Agreements



On January 1, 2006, CBAI entered into one-year employment agreements with three executive officers, Matthew L. Schissler, Sandra D. Anderson and Noah J. Anderson (the "Executive Agreements"). Pursuant to the Executive Agreements with Matthew L. Schissler, Mr. Schissler serves as Chairman and Chief Executive Officer of CBAI at an annual salary of $150,000 through December 31, 2006. The Executive Agreement entitles Mr. Schissler to receive a net year-end performance bonus of $25,000, which is included in accrued expenses as part of wages payable in the accompanying Balance Sheet, as well as certain other benefits. Mr. Schissler is subject to non-competition and confidentiality requirements. CBAI may terminate Mr. Schissler's Executive Agreement at any time without cause. In such event, no later than the Termination Date specified in the Termination Notice (both as defined in the Executive Agreement), CBAI shall pay to Mr. Schissler an



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amount in cash equal to the sum of his Compensation determined as of the date of such Termination Notice through the remaining term of the Executive Agreement.. Although Matthew L. Schissler never signed a renewal to the one year employment agreement, he serves as our Chairman and Chief Executive Officer at an annual salary of $150,000 through December 31, 2007. Mr. Schissler received a management performance bonus from the Rain subsidiary of $36,000, as well as certain other benefits.



Pursuant to the Executive Agreement with Sandra Anderson, Ms. Anderson was serving as Chief Financial Officer of CBAI at an annual salary of $108,000 through December 31, 2006. The Executive Agreement entitled Ms. Anderson to receive a quarterly performance bonus of up to $5,500 as well as certain other benefits. Ms. Anderson is subject to non-competition and confidentiality requirements. CBAI may terminate this Executive Agreement at any time without cause. In such event, not later than the Termination Date specified in the Termination Notice (both as defined in the Executive Agreement, CBAI shall pay to Ms. Anderson an amount in cash equal to the sum of her Compensation for 90 days determined as of the date of such Termination Notice Agreement (as defined in the Executive Agreement). On September 8, 2006 CBAI notified Ms. Anderson of its intention to cancel its contract with her effective September 8, 2006. CBAI satisfied all of its obligations at the termination of this contract.



Pursuant to the Executive Agreement with Noah J. Anderson, Mr. Anderson will serve as Chief Technology Officer of CBAI and President of Family at an annual salary of $108,000 through December 31, 2006. The Executive Agreement entitles Mr. Anderson to receive a quarterly performance bonus of up to 10% of Gross Profit of Family, a year-end bonus of up to 10% of Net Income of Family as well as certain other benefits. Mr. Anderson is subject to non-competition and confidentiality requirements. CBAI may terminate this Executive Agreement at any time without cause. In such event, not later than the Termination Date specified in the Termination Notice (both as defined in the Executive Agreement), CBAI shall pay to Mr. Anderson an amount in cash equal to the sum of his Compensation for 90 days determined as of the date of such Termination Notice Agreement (as defined in the Executive Agreement). On September 8, 2006 CBAI notified Mr. Anderson of its intention to cancel its contract with him effective September 8, 2006. CBAI satisfied all of its obligations at the termination of this contract.



Compensation of the Board of Directors



On January 26, 2006, CBAI's Board of Directors approved a Board Compensation Plan (the Plan) effective through 2008. The Plan calls for all Board members (five) to receive shares of the Companys common stock to be issued as compensation for 2006 and 2007, in an amount equal to $10,000 per year.  Shares issued as compensation for one year of service in 2008 will be based on $10,000 divided by the closing stock price on the last business day of 2007.



Note 9. Related Party Transactions and Commitments



Advances from Officers



In prior years, the Company received non-interest bearing advances from officers of CBAI. During the year ended December 31, 2007, $44,499 of this advance was repaid and the balance remaining amounted to $684. In addition, on May 11, 2007, Ms. Stephanie Schissler, who is the spouse of the Company's Chief Executive Officer, loaned $121,500 to theCompany, to be repaid in 36 equal monthly installments of $3,908. The Company signed a Promissory Note, which carries interest at the rate of 10% per annum.In addition, the Company pledged as security 2,500,000 common shares to be held in treasury until the loan is paid off. At December 31, 2007, the balance remaining on this loan was $100,717.



On June 14, 2007, Ms. Stephanie Schissler loaned a further $76,950 to the Company, to be repaid in 36 equal monthly installments of $2,483. The Company signed a Promissory Note, which carries interest at the rate of 10% per annum.In addition, the Company pledged as security 2,250,000 common shares to be held in treasury until the loan is paid off. At December 31, 2007, the balance remaining on this loan was $65,667.



On June 14, 2007, Mr. Matt Schissler loaned $25,650 to the Company, to be repaid in 36 equal monthly installments of $828. The Company signed a Promissory Note, which carries interest at the rate of 10% per annum.In addition, the Company pledged as security 750,000 common shares to be held in treasury until the loan is paid off. At December 31, 2007, the balance remaining on this loan was $21,887.



Consulting Agreement



On January 1, 2006, CBAI entered into a one-year consulting agreement with Stephanie Schissler, CBAI's former President and Chief Operating Officer. Ms. Schissler is the spouse of the Company's Chief Executive Officer. The agreement entitles Ms. Schissler to a $10,000 per month retainer and stock option incentives for her services in relation to strategic corporate planning and other business related matters. The agreement automatically renews for a second year, unless a 60-day written notice of cancellation is provided by either CBAI or Ms. Schissler.



F-15



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Note 10. Stock Option Plan



The Company's Stock Option Plan permits the granting of stock options to its employees, directors, consultants and independent contractors for up to 8.0 million shares of its common stock. The Company believes that such awards encourage employees to remain employed by the Company and also to attract persons of exceptional ability to become employees of the Company.



The Company adopted the provisions of SFAS No. 123R,Share-Based Payment (SFAS No. 123(R)), which requires the measurement and recognition of compensation expense for all stock-based awards made to employees and non-employee directors.



| |  |  |  |  |  |  |  | 
| |  |  |  |  |  |  |  | 
| |  |  |  |  |  |  |  | 

The fair value of stock options granted in 2007 was $8,275, based on the following assumptions:



|                        |        
|----------------------- | -------
|                        | 2007   
|Risk-free interest rate | 4.68%  
|Expected life           | 6 years
|Dividend yield          | 0.00%  
|Volatility              | 276.80%



The Companys computation of expected volatility is based on the historical daily volatility of its publicly traded stock. For option grants issued during the year ended December 31, 2007 and 2006, the Company used a calculated volatility for each grant. The Companys computation of expected life were estimated using the simplified method provided for under Staff Accounting Bulletin 107 (SAB 107), which averages the contractual term of the Companys options of ten years with the average vesting term of three years for an average of six years. In December 2007, Staff Accounting Bulletin 110 (SAB 110) was released which permits the continued use of the simplified method when a Company is unable to rely on the historical exercise data. Since the Company is still in its relatively early stages, it will continue with the simplified method. The dividend yield assumption of zero is based upon the fact the Company has never paid cash dividends and presently has no intention of paying cash dividends. The risk-free interest rate used for each grant is equal to the U.S. Treasury rates in effect at the time of the grant for instruments with a similar expected life.



The estimated fair value of our stock-based awards, less expected forfeitures, is amortized over the awards vesting period. Options granted since 2005 are either vested immediately or had a one year vesting period.



The following table summarizes stock option activity for the years ended December 31, 2007 and 2006:



|                                 |               |  |                          |      |                                      |    
|-------------------------------- | ------------- |  | ------------------------ | ---- | ------------------------------------ | ---
|                                 |               |  | Weighted Average        
|                                 | Option Shares |  | Exercise Price per Share |      | Contractual Remaining Life, in Years
|                                 |               |  |                          |      |                                      |    
|Outstanding at January 1, 2006   | 6,639,189     |  | $                        | 0.28 |                                      |    
|Granted                          | -             |  |                          |      |                                      |    
|Exercised                        | -             |  |                          |      |                                      |    
|Expired/Forfeited                | (1,178,000)   |  |                          | 0.24 |                                      |    
|                                 |               |  |                          |      |                                      |    
|Outstanding at December 31, 2006 | 4,423,189     |  |                          | 0.29 |                                      |    
|Granted                          | 90,000        |  |                          | 0.10 |                                      |    
|Exercised                        | -             |  |                          |      |                                      |    
|Expired/Forfeited                | (121,668)     |  |                          | 0.24 |                                      |    
|                                 |               |  |                          |      |                                      |    
|Outstanding at December 31, 2007 | 5,461,189     |  | $                        | 0.28 |                                      | 7.0
|                                 |               |  |                          |      |                                      |    
|Exercisable at December 31, 2007 | 4,391,521     |  | $                        | 0.29 |                                      | 5.4



No amounts relating to employee stock-based compensation have been capitalized. Under provisions of SFAS 123(R), the Company recorded $9,000 and $251,000 of employee stock-based compensation for the years ended December 31, 2007 and 2006, respectively.



As of December 31, 2007, there was $35,000 of unrecognized compensation expense related to options for which service has not yet been rendered.



Note 11. Warrant Agreements



CBAI issued 111,464,592 warrants during the year ending December 31, 2007 in connection with its financings.



The following table summarizes the warrants outstanding and exercisable at December 31, 2007:



F-16



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|                                   |                         |              
|---------------------------------- | ----------------------- | -------------
|WARRANTS OUTSTANDING
& EXERCISABLE | WEIGHTED EXERCISE PRICE | MATURITY DATE
|1,000,000                          | $0.1875                 | 9/16/2009    
|14,285,000                         | $0.101                  | 9/9/2010     
|8,285,000                          | $0.101                  | 9/9/2010     
|40,000,000                         | $0.101                  | 2/14/2012    
|71,464,592                         | $0.037                  | 11/26/2012   
|135,034,592                        | $0.068                  |              



Note 12. Income Taxes



The Company has loss carryforwards that it can use to offset a certain amount of taxable income in the future. The loss carryforwards are subject to significant limitations due to change in ownership. The Company is currently analyzing its amount of loss carryforwards, but has recorded a valuation allowance for the entire benefit due to the uncertainty of its realization.



Note 13. Stockholders Deficit



Common Stock



As of December 31, 2007 CBAI had 195,558,923 shares of Common Stock outstanding. An additional 7,266,667 treasury shares have been issued in 2007, resulting in a total of 46,266,667 shares issued and remaining in the Companys treasury.



Note 14. Discontinued Operations



On September 5, 2006, the Company entered into a Stock Purchase Agreement (the Anderson Agreement) with Noah Anderson, the President of Family Marketing, Inc., a wholly-owned subsidiary of the Company (Family), and Chief Technology Officer of the Company. Mr. Anderson also is the spouse of Ms. Anderson, the Companys former Chief Financial Officer. Pursuant to the Anderson Agreement, the Company sold all assets and liabilities of Family to Mr. Anderson, in exchange for a credit of $82,500 in Familys outstanding receivables carried by Cord Partners, Inc., and cancellation of $32,500 in severance compensation.



The Company follows the provisions of SFAS No. 144, "Accounting for the Impairment or Disposal of Long-Lived Assets" ("SFAS No.144"), related to the accounting and reporting for segments of a business to be disposed of. In accordance with SFAS No. 144, the definition of discontinued operations includes components of an entity whose cash flows are clearly identifiable.



Following is a summary of the discontinued results of operations and the loss on sale of Family for the years ended December 31, 2006:



|                                               |  |              |    |      |   |          
|---------------------------------------------- |  | ------------ | -- | ---- | - | ---------
|                                               |  | Year Ended  
|                                               |  | December 31,
|                                               |  | 2007         |    | 2006
|Revenue                                        |  | $            | -- |      | $ | 558,260  
|Cost of services                               |  |              | -- |      |   | 135,240  
|Operating Expenses                             |  |              | -- |      |   | 340,520  
|Net Income (Loss) from Discontinued Operations |  |              | -- |      |   | 82,500   
|Loss on Sale of Discontinued Operations        |  |              | -- |      |   | (125,830)
|Loss from Discontinued Operations              |  | $            | -- |      | $ | (43,330) 



Note 15. Segment Reporting



SFAS No. 131 "Disclosures about Segments of an Enterprise and Related Information," requires that public business enterprises report financial and descriptive information about its reportable operating segments. CBAI has three operating segments. Cord generates revenues related to the processing and preservation of umbilical cord blood. Rain generates revenues related to television and radio advertising. Family generated revenues related to internet advertising. (see Note 14, Discontinued Operations). All of its long-lived assets are located in, and substantially all of its revenues are generated from within, the United States of America. The table below presents certain financial information by business segment for the year ended December 31, 2007:



F-17



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|                                |            |             |            |          |             |        |          |           |              |   |             |  |   |            
|------------------------------- | ---------- | ----------- | ---------- | -------- | ----------- | ------ | -------- | --------- | ------------ | - | ----------- |  | - | -----------
|                                |            |             |            | Adipose/ |             | Radio/ |          |           |              |  
|                                | Umbilical  |             | Peripheral |          | Television  |        | Segments |           | Consolidated
|                                | Cord Blood |             | Blood      |          | Advertising |        | Total    |           | Total       
|Revenue from External Customers | $          | 3,144,639   |            |          | -           |        | $        | 2,666,628 |              | $ | 5,811,267   |  | $ | 5,811,267  
|Interest Expense                |            | 2,083,255   |            |          | -           |        |          | -         |              |   | 2,083,255   |  |   | 2,083,255  
|Depreciation and Amortization   |            | 521,856     |            |          | -           |        |          | -         |              |   | 521,856     |  |   | 521,856    
|Segment Income (Loss)           |            | (5,822,825) |            |          | -           |        |          | 171,179   |              |   | (5,944,004) |  |   | (5,944,004)
|Segment Assets                  | $          | 6,722,198   |            |          | -           |        | $        | 11,203    |              | $ | 6,733,401   |  | $ | 6,733,401  



The table below presents certain financial information by business segment for the year ended December 31, 2006:



|                                |            |             |            |          |             |        |          |           |              |   |             |  |   |            
|------------------------------- | ---------- | ----------- | ---------- | -------- | ----------- | ------ | -------- | --------- | ------------ | - | ----------- |  | - | -----------
|                                |            |             |            | Adipose/ |             | Radio/ |          |           |              |  
|                                | Umbilical  |             | Peripheral |          | Television  |        | Segments |           | Consolidated
|                                | Cord Blood |             | Blood      |          | Advertising |        | Total    |           | Total       
|Revenue from External Customers | $          | 1,136,549   |            |          | -           |        | $        | 2,191,787 |              | $ | 3,328,336   |  | $ | 3,328,336  
|Interest Expense                |            | 2,111,686   |            |          | -           |        |          | 819       |              |   | 2,112,505   |  |   | 2,112,505  
|Depreciation and Amortization   |            | 39,720      |            |          | -           |        |          | 32        |              |   | 39,752      |  |   | 39,752     
|Segment Income (Loss)           |            | (5,723,479) |            |          | (61,429)    |        |          | 139,506   |              |   | (5,645,402) |  |   | (5,645,402)
|Segment Assets                  | $          | 631,710     |            |          | 96          |        | $        | 99,527    |              | $ | 731,333     |  | $ | 731,333    





F-18



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ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE



None



ITEM 8B.CONTROLS AND PROCEDURES



It is management's responsibility to establish and maintain adequate internal control over all financial reporting pursuant to Rule 13a-15 under the Securities Exchange Act of 1934 (the "Exchange Act"). Our management, including our principal executive officer and our principal financial officer, have reviewed and evaluated the effectiveness of our disclosure controls and procedures as of December 31, 2007.  Following this review and evaluation, management collectively determined that our disclosure controls and procedures are

not

effective to ensure that information required to be disclosed by us in reports that we file or submit under the Exchange Act (i) is recorded, processed, summarized and reported within the time periods specified in SEC rules and forms, and (ii) is accumulated and communicated to management, including our chief executive officer, our chief operations officer, and our chief financial officer, as appropriate to allow timely decisions regarding required disclosure.



The deficiency in our disclosure controls and procedures is related to a lack of segregation of duties due to the size of the accounting department and the lack of qualified accountants due to the limited financial resources of the Company. We are actively seeking additional financing to be able to afford to hire accounting staff in an effort to remediate this deficiency.



Changes in Internal Control over Financial Reporting



There were no significant changes in the Company's internal controls over financial reporting or in other factors that could significantly affect these internal controls subsequent to the date of their most recent evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.



Managements Report on Internal Control over Financial Reporting



Our management is responsible for establishing and maintaining adequate internal control over our financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act). Internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with accounting principles generally accepted in the United States of America.



Our internal control over financial reporting includes those policies and procedures that (i) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets, (ii) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with accounting principles generally accepted in the United States of America, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors, and (iii) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on the financial statements.



Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.



We assessed the effectiveness of our internal control over financial reporting as of December 31, 2007. In making this assessment, management used the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in

Internal Control-Integrated Framework

..



Based upon managements assessment using the criteria contained in COSO, and for the reasons discussed below, our management has concluded that, as of December 31, 2007, our internal control over financial reporting was not effective.



Based on its evaluation, the Company's Chief Executive Officer




and Chief Financial Officer

identified a major deficiency that existed in the design or operation of our internal control over financial reporting that it considers to be a material weakness. The Public Company Accounting Oversight Board has defined a material weakness as a significant deficiency or combination of significant deficiencies that results in more than a remote likelihood that a material misstatement of the annual or interim financial statements will note be prevented or detected.




 The material weakness started at the beginning of 2007.



The deficiency in our internal control is related to a lack of segregation of duties due to the size of the accounting department and the lack of qualified accountants due to the limited financial resources of the Company.

We are actively searching for additional capital in order to be in position to add the necessary staff to address this material weakness.

We are

also assessing how we can









improve

 our internal control over financial reporting

 with the current number of employees

 in an effort to remediate this deficiency.





19



---

This Annual Report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. Managements report was not subject to attestation by our registered public accounting firm pursuant to temporary rules of the SEC that permit us to provide only managements report in this Annual Report.



20



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PART III



ITEM 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT

Officers and Directors

The following table sets forth the names and positions of our executive officers and directors. Our directors are elected at our annual meeting of stockholders and serve for one year or until successors are elected and quality.  Our Board of Directors elects our officers, and their terms of office are at the discretion of the Board, except to the extent governed by an employment contract.



Our directors, executive officers and other significant employees, their ages and positions are as follows:



|                     |  |     |  |                                     
|-------------------- |  | --- |  | ------------------------------------
|                     |  |     |  |                                     
|Name                 |  | Age |  | Position with the Company           
|Matthew L. Schissler |  | 36  |  | Chairman and Chief Executive Officer
|Joseph R. Vicente    |  | 44  |  | Director and Vice President         
|Timothy McGrath      |  | 42  |  | Director                            
|Richard J. Neeson    |  | 57  |  | Director                            



Matthew L. Schissler is one of our founders and has served as Chairman of the Board and Chief Executive Officer of since January 2003. From April 2001 until January 2003, Mr. Schissler was the President and Chief Executive Officer of Rain, 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.



Joseph R. Vicente has been a director of CBAI since April 2004.  Since November 2004 Mr. Vicente has also served as a Vice President of CBAI. From July 2002 through October 2004, Mr. Vicente was an independent consultant where he provided strategic consulting services to organizations on acquisitions, operational practices and efficiencies, and sales management.  From July 1993 through April 2002, he was a Senior Vice President at TMP Worldwide, Inc. where he held various strategic, operational, and sales management positions.



Timothy McGrath has been a director of CBAI since March 2006. Mr. McGrath has served in an executive capacity for the past twelve years and is currently the Vice President of Finance and Accounting for BioE, Inc.  From October 1999 through September 2005 Mr. McGrath served as Vice President and Chief Financial Officer of Orphan Medical, Inc.



Richard J. Neeson has been a director of CBAI since June 2007.  Mr. Neeson has been with Independence Blue Cross (IBC) since November 1993, when he joined IBC as President and Chief Operating Officer of QCC, Inc., the holding company for IBC's for-profit subsidiaries.  At IBC, Mr. Neeson has been primarily responsible for acquisitions, joint ventures and strategic partnerships, including negotiation, contract development and oversight.  Mr. Neeson has also been responsible for oversight of IBCs investments in several partially owned subsidiaries, including NewSeasons, since its formation in 1996.  Mr. Neeson has been actively involved in the management of New Seasons operations since inception.  IBC purchased its partners interest in NewSeasons in 2001, and at that time, Mr. Neeson took on the additional role of President and Chief Executive Officer of NewSeasons on a full-time basis. Since June 2004, Mr. Neeson has also been chairman of Vita34 International AG, a German umbilical cord blood blank.  Mr. Neeson is a 1972 graduate of the University of Notre Dame with a BA in Economics, and a 1981 graduate of the University of Connecticut with a MBA in Finance/Management.



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.



Audit Committee and Financial Expert



21



---



As of April 2, 2007, our board of directors has determined that Cord Blood has one audit committee financial expert, Mr. Timothy McGrath, and two committee members serving on its audit committee. Prior to March 1, 2006, Sandra Smith and Matthew Schissler performed some of the same functions of an audit committee, such as: recommending a firm of independent certified public accountants to audit the annual financial statements; reviewing the independent auditors independence, the financial statements and their audit report; and reviewing managements administration of the system of internal accounting controls. On April 6, 2006, the board adopted its written audit committee charter.



Changes in Nominating Procedures



None



Code of Ethics



We adopted a Code of Ethics on April 13, 2005 that applies to all of our directors, officers and employees, including our principal executive officer, principal financial officer and principal accounting officer. The Code of Ethics was attached as Exhibit 14.1 to our registration statement filed on Form SB-2 on May 2, 2005.



SECTION 16(a) Beneficial Ownership Reporting Companies



Section 16(a) of the Securities Exchange Act of 1934, as amended, requires our directors and executive officers and persons who own more than 10% of the issued and outstanding shares of Cord Bloods common stock to file reports of initial ownership of common stock and other equity securities and subsequent changes in that ownership with the SEC and the NYSE. Officers, directors and greater than ten percent stockholders are required by SEC regulation to furnish us with copies of all Section 16(a) forms they file. To our knowledge, based solely on a review of the copies of such reports furnished to us and written representations that no other reports were required, during the fiscal year ended December 31, 2007 all Section 16(a) filing requirements applicable to our officers, directors and greater than 10% beneficial owners were complied with.



ITEM 10. EXECUTIVE COMPENSATION



The following table sets forth the compensation paid to our chief executive officer for each of our last two completed fiscal years. No other officer received compensation greater than $100,000 for either fiscal year.



|                                  |  |      |  |  |            |  |  |           |  |                  |        |                   |        |                                            |   |                                                                               |   |                            |        |           |  |         |  |  |  |  | 
|--------------------------------- |  | ---- |  |  | ---------- |  |  | --------- |  | ---------------- | ------ | ----------------- | ------ | ------------------------------------------ | - | ----------------------------------------------------------------------------- | - | -------------------------- | ------ | --------- |  | ------- |  |  |  |  | 
|                                  |  |      |  |  |            |  |  |           |  |                  |        |                   |        |                                            |   |                                                                               |   |                            |        |           |  |         |  |  |  |  | 
|Name & Principal
Position         |  | Year |  |  | Salary ($) |  |  | Bonus
($) |  | Stock
Awards
($) |        | Option
Awards
($) |        | Non-Equity
Incentive Plan
Compensation
($) |   | Change in Pension
Value and Non-
Qualified
Deferred
Compensation
Earnings ($) |   | All
Other
Compensation
($) |        | Total ($)
|Matthew L. Schissler              |  | 2007 |  |  | 150,000    |  |  | 0         |  |                  | 0      |                   | 0      |                                            | 0 |                                                                               | 0 |                            | 36,000 |           |  | 186,000
|                                  |  | 2006 |  |  | 150,000    |  |  | 25,000    |  |                  | 10,000 |                   | 55,068 |                                            | 0 |                                                                               | 0 |                            |        |           |  | 240,068
|Chairman, Chief Executive Officer |  |      |  |  |            |  |  |           |  |                  |        |                   |        |                                            |   |                                                                               |   |                            |        |           |  |         |  |  | 



Outstanding equity awards at fiscal year end.



The following table sets forth information with respect to the outstanding equity awards of our principal executive officers and principal financial officers during 2007, and each person who served as an executive officer of Cord Blood as of December 31, 2007:





22



---



|                     |  |                                                                     |  |                                                                       |  |                                                                                                   |  |                           |  |                        |  |                                                             |  |                                                                   |  |                                                                                                         |  |                                                                                                                         |  | 
|-------------------- |  | ------------------------------------------------------------------- |  | --------------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------- |  | ------------------------- |  | ---------------------- |  | ----------------------------------------------------------- |  | ----------------------------------------------------------------- |  | ------------------------------------------------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------- |  | 
|                     |  |                                                                     |  |                                                                       |  |                                                                                                   |  |                           |  |                        |  |                                                             |  |                                                                   |  |                                                                                                         |  |                                                                                                                         |  | 
|Option Awards        |  | Stock Awards                                                        | 
|Name                 |  | Number
of
Securities
Underlying
Unexercised
Options
(#)
Exercisable |  | Number
of
Securities
Underlying
Unexercised
Options
(#)
Unexercisable |  | Equity
Incentive
Plan
Awards:
Number
of
Securities
Underlying
of
Unexercised
Unearned
Options
(#) |  | Option
Exercise
Price
($) |  | Option
Expiration
Date |  | Number
of Shares
or Units
of Stock
That
Have
Not
Vested
(#) |  | Market
Value
of
Shares
or
Units
of
Stock
That
Have
Not
Vested
($) |  | Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units
or
Other
Rights
That
Have
Not
Vested
(#) |  | Equity
Incentive
Plan Awards:
Market or
Payout
Value
of
Unearned
Shares,
Units or
Other
Rights
That
Have
Not
Vested
($) | 
|Matthew L. Schissler |  | 250,000                                                             |  | 0                                                                     |  | 250,000                                                                                           |  | 0.25                      |  | 4/29/14                |  | 0                                                           |  | 0                                                                 |  | 0                                                                                                       |  | 0                                                                                                                       | 
|                     |  | 20,255                                                              |  | 0                                                                     |  | 0                                                                                                 |  | 0.18                      |  | 7/1/15                 |  | 0                                                           |  | 0                                                                 |  | 0                                                                                                       |  | 0                                                                                                                       | 
|                     |  | 1,600,000                                                           |  | 0                                                                     |  | 0                                                                                                 |  | 0.31                      |  | 9/12/15                |  | 0                                                           |  | 0                                                                 |  | 0                                                                                                       |  | 0                                                                                                                       | 
|                     |  | 250,000                                                             |  | 0                                                                     |  | 0                                                                                                 |  | 0.20                      |  | 12/31/15               |  | 0                                                           |  | 0                                                                 |  | 0                                                                                                       |  | 0                                                                                                                       | 



COMPENSATION OF DIRECTORS



Director Compensation for year ending December 31, 2007



The following table sets forth with respect to the named director, compensation information inclusive of equity awards and payments made in the year ended December 31, 2007.



|                  |                                  |                  |                   |                                            |                                                 |                            |          
|----------------- | -------------------------------- | ---------------- | ----------------- | ------------------------------------------ | ----------------------------------------------- | -------------------------- | ---------
|                  |                                  |                  |                   |                                            |                                                 |                            |          
|Name              | Fees Earned
or Paid in
 Cash
($) | Stock
Awards
($) | Option
Awards
($) | Non-Equity
Incentive Plan
Compensation
($) | Nonqualified
Deferred
Compensation
Earnings
($) | All Other
Compensation
($) | Total
($)
|(a)               | (b)                              | (c)              | (d)               | (e)                                        | (f)                                             | (g)                        | (h)      
|Matthew Schissler | --                               | $10,000 (1)      | --                | --                                         | --                                              | --                         | $10,000  
|Timothy McGrath   | --                               | $10,000          | --                | --                                         | --                                              | --                         | $10,000  
|Richard Neeson    | --                               | $10,000          | --                | --                                         | --                                              | --                         | $10,000  
|Joseph R. Vicente | --                               | $10,000          | --                | --                                         | --                                              | --                         | $10,000  



(1) These stock awards were awarded in his capacity as a director. He also received additional stock option awards in his capacity as an executive officer (see first table in Item 10 above).



In January 2006, we implemented a standard arrangement for the compensation of our directors. On January 26, 2006 the Companys board of directors approved a board compensation plan through 2008. Shares issued as compensation for one year of service in 2007 and 2006 are based on the closing stock price of the last business day of 2007 and on the closing stock price on January 25, 2006, respectively, divided by $10,000. Shares issued as compensation for one year of service in 2008 will be based on the closing stock price of the last business day of 2007, divided by $10,000.



EMPLOYMENT AGREEMENTS



On January 1, 2006, we entered into one year employment agreements with executive officer, Matthew L. Schissler. Pursuant to the employment agreement with Matthew L. Schissler, Mr. Schissler serves as our Chairman and Chief Executive Officer at an annual salary of $150,000 through December 31, 2006.  The agreement entitles Mr. Schissler to receive a net year-end performance bonus of $25,000, a management performance bonus from the Rain subsidiary of $36,000 as well as certain other benefits.  Mr. Schissler is subject to non-competition and confidentiality requirements.  We may terminate this Agreement at any time without cause.  In such event, not later than the



23



---

termination date specified in the termination notice, we shall pay to Mr. Schissler an amount in cash equal to the sum of the Mr. Schisslers Compensation determined as of the date of such termination notice through the remaining term of the agreement.



Although Matthew L. Schissler never signed a renewal to the one year employment agreement, he serves as our Chairman and Chief Executive Officer at an annual salary of $150,000 through December 31, 2007. Mr. Schissler received a management performance bonus from the Rain subsidiary of $36,000, as well as certain other benefits.  Mr. Schissler is subject to non-competition and confidentiality requirements.  We may terminate this Agreement at any time without cause.  In such event, not later than the termination date specified in the termination notice, we shall pay to Mr. Schissler an amount in cash equal to the sum of the Mr. Schisslers Compensation determined as of the date of such termination notice through the remaining term of the agreement.



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



The following table sets forth, as of December 19, 2007 (unless otherwise indicated), certain information with respect to the beneficial ownership of our common stock by each stockholder known by us to be the beneficial owner of more than 5% of our common stock and by each of our current directors and executive officers. Each person has sole voting and investment power with respect to the shares of common stock, except as otherwise indicated. Information relating to beneficial ownership of common stock by our principal stockholders and management is based upon information furnished by each person using beneficial ownership concepts under the rules of the Securities and Exchange Commission. Under these rules a person is deemed to be a beneficial owner of a security if that person has or shares voting power, which includes the power to vote or direct the voting of the security or investment power, which includes the power to vote or direct the voting of the security. The person is also deemed to be a beneficial owner of any security of which that person has a right to acquire beneficial ownership within 60 days. Under the Securities and Exchange Commission rules, more than one person may be deemed to be a beneficial owner of the same securities and a person may be deemed to be a beneficial owner of securities as to which he or she may not have any pecuniary beneficial interest.



Shares of common stock which an individual or group has a right to acquire within 60 days pursuant to the exercise or conversion of options are deemed to be outstanding for the purpose of computing the percentage ownership of such individual or group, but are not deemed to be outstanding for the purpose of computing the percentage ownership of any other person shown in the table.



The applicable percentage of ownership is based on 225,154,440 shares of our Common Stock issued and outstanding as of April 7, 2008.



|                                                                                                      |  |                                           |  |                 
|----------------------------------------------------------------------------------------------------- |  | ----------------------------------------- |  | ----------------
|Name and Title                                                                                        |  | Amount and Nature of
Beneficial Ownership |  | Percent of Class
|Matthew L. Schissler
Chairman and CEO                                                                 |  | 11,272,045 (1)                            |  | 7.26%           
|                                                                                                      |  |                                           |  |                 
|Enable Growth Partners LP
One Ferry Building, Ste. 255
San Francisco, CA 94111                        |  | 16,826,895 (3)                            |  | 9.99%           
|                                                                                                      |  |                                           |  |                 
|Enable Opportunity Partners LP
One Ferry Building, Ste. 255
San Francisco, CA 94111                   |  | 16,826,895 (3)                            |  | 9.99%           
|                                                                                                      |  |                                           |  |                 
|Pierce Diversified Strategy Master
Fund LLC, Ena
One Ferry Building, Ste. 255
San Francisco, CA 94111 |  | 16,826,895 (3)                            |  | 9.99%           
|                                                                                                      |  |                                           |  |                 
|Independence Blue Cross (4)
1901 Market Street
Philadelphia, PA 19103                                 |  | 14,681,366                                |  | 9.45%           
|                                                                                                      |  |                                           |  |                 
|CorCell, Inc. (5)
1717 Arch Street, Suite 1410
Philadelphia, PA 19103                                 |  | 18,498,715 (6)                            |  | 11.91%          
|                                                                                                      |  |                                           |  |                 
|Fuselier Holdings
1207 Hampshire Lane
Richardson, TX 75808                                            |  | 14,475,000                                |  | 9.32%           
|                                                                                                      |  |                                           |  |                 
|All Executive Officers
and Directors as a Group
(3 Persons)                                           |  | 21,391,079                                |  | 13.9%           



24



---



| |  |  |  | 
| |  |  |  | 

(1) Includes 2,370,555 currently exercisable options held by Mr. Schissler (although out of the money), and 3,068,290 shares and 962,625 options held by Stephanie Schissler, Mr. Schisslers wife (also out of the money). Mr. Schissler disclaims beneficial ownership of the shares beneficially owned by his wife.



(3) Enable Growth Partners LP, Enable Opportunity Partners LP, and Pierce Diversified Strategy Master Fund LLC, Ena are affiliates of each other and beneficially own convertible notes and warrants pursuant to which they contractually agreed that their beneficial ownership in the aggregate shall not exceed 9.99% of the shares of the Companys common stock immediately after giving effect to conversion or exercise of such notes and warrants.



(4) Richard J. Neeson, a director of CBAI, is a Senior Vice President of Independence Blue Cross. Mr. Neeson disclaims beneficial ownership of the shares owned by Independence Blue Cross.



(5) CorCell, Inc. is a wholly owned subsidiary of Vita34 International AG (Vita34). Richard J. Neeson, a director of CBAI, is the chairman of Vita34. Mr. Neeson disclaims beneficial ownership of the shares owned by CorCell, Inc.



(6) Includes 2,101,000 shares issuable upon conversion of a convertible note. Does not include 1,666,667 treasury shares held by CorCell, Inc. as collateral for a promissory note.



(7) Includes 2,507,750 shares beneficially owned by RHK Midtown Partners & Co., LLC. Mr. Kreger disclaims beneficial ownership of the shares beneficially owned by RHK Midtown Partners & Co., LLC.



The address for each of the named persons, unless otherwise indicated, is c/o Cord Blood America, Inc., 501 Santa Monica Blvd., Suite 700, Santa Monica, CA 90401.



ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE



Certain Relationships and Related Transactions



During 2007, we have entered into 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:

(1)

On January 1, 2006, we entered into a one year consulting agreement with Stephanie Schissler, our former President and Chief Operating Officer.  The agreement entitles Ms. Schissler to a $10,000 per month retainer and stock option incentives for her services in relation to strategic corporate planning and other business related matters.  The agreement automatically renews for a second year, unless a 60 day written notice of cancellation is provided by us or Ms. Schissler.



(2)

In prior years, the Company received non-interest bearing advances from officers of CBAI. During the year ended December 31, 2007, $44,499 of this advance was repaid and the balance remaining amounted to $684. In addition, on May 11, 2007, Ms. Stephanie Schissler, who is the spouse of the Company's Chief Executive Officer, loaned $121,500 to theCompany, to be repaid in 36 equal monthly installments of $3,908. The Company signed a Promissory Note, which carries interest at the rate of 10% per annum.In addition, the Company pledged as security 2,500,000 common shares to be held in treasury until the loan is paid off. At December 31, 2007, the balance remaining on this loan was $100,717.



(3)

On June 14, 2007, Ms. Stephanie Schissler loaned a further $76,950 to the Company, to be repaid in 36 equal monthly installments of $2,483. The Company signed a Promissory Note, which carries interest at the rate of 10% per annum.In addition, the Company pledged as security 2,250,000 common shares to be held in treasury until the loan is paid off. At December 31, 2007, the balance remaining on this loan was $65,667.



(4)

On June 14, 2007, Mr. Matt Schissler loaned $25,650 to the Company, to be repaid in 36 equal monthly installments of $828. The Company signed a Promissory Note, which carries interest at the rate of 10% per annum.In addition, the Company pledged as security 750,000 common shares to be held in treasury until the loan is paid off. At December 31, 2007, the balance remaining on this loan was $21,887.



(5)

In March of 2004, Cord became a party to a Web Development and Maintenance Agreement with Gecko Media, Inc. Stephen Weir, a director of Cord Blood, 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 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



25



---

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.  On May 5, 2006, Cord entered into a new 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. The Web Agreement replaced the agreement that expired on March 31, 2006. The Web Agreement calls for fees of $10,000 per month from April 2006 until termination in April 2008. At the beginning of each annual term, CBAI will issue to Gecko Media so many shares of common stock of CBAI as will total a value of $10,000 at the closing sales price of CBAI stock on the date of issuance.  Subsequent to the period ended December 31, 2006 this was terminated pursuant to the terms of the Agreement.

(6)

Family Marketing, Inc., (Family) specialized in delivering leads generated through various forms of internet advertising to corporate customers in the business of family based products and services. On September 5, 2006, the Company entered into a Stock Purchase Agreement (the Purchase Agreement) with Noah Anderson who at the time was the Chief Technology Officer of CBAI.  Pursuant to the Purchase Agreement, the Company sold all assets including customers, websites and related software and trademarks along with liabilities of Family Marketing to Mr. Anderson, in exchange for a credit of $82,500 against receivables that Cord Partners, Inc., owed Family and the cancellation of $32,500 in severance compensation to Mr. Anderson (the Sale).



Board determination of Independence

Messrs. McGrath and Neeson are each independent as that term is defined under the National Association of Securities Dealers Automated Quotation system.



ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K



|        |  |             |                                                                                                                                  |  |  |  |  |  |  |  |  |  | 
|------- |  | ----------- | -------------------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  |  |  |  |  | 
|        |  |             |                                                                                                                                  | 
|EXHIBIT |  | DESCRIPTION |                                                                                                                                 
|2.0     |  |             | Form of Common Stock Share Certificate of Cord Blood America, Inc. (1)                                                          
|        |  |             |                                                                                                                                 
|3.0     |  |             | Amended and Restated Articles of Incorporation of Cord Blood American, Inc. (1)                                                 
|        |  |             |                                                                                                                                 
|3.1     |  |             | Amended and Restated Bylaws of Cord Blood America, Inc. (1)                                                                     
|        |  |             |                                                                                                                                 
|5.1     |  |             | Opinion of Sichenzia Ross Friedman Ference LLP (31)                                                                             
|        |  |             |                                                                                                                                 
|10.0    |  |             | Patent License Agreement dated as of January 1, 2004 between PharmaStem Therapeutics, Inc. and Cord Partners, Inc. (2)          
|        |  |             |                                                                                                                                 
|10.1    |  |             | Web Development and Maintenance Agreement dated March 18, 2004 by and between Gecko Media, Inc. and Cord Partners, Inc. (1)     
|        |  |             |                                                                                                                                 
|10.2    |  |             | Stock Option Agreement dated April 29, 2004 by and between Cord Blood America, Inc. and Matthew L. Schissler (1)                
|        |  |             |                                                                                                                                 
|10.3    |  |             | Stock Option Agreement dated April 29, 2004 by and between Cord Blood America, Inc. and Joseph R. Vicente (1)                   
|        |  |             |                                                                                                                                 
|10.4    |  |             | Stock Option Agreement dated April 29, 2004 by and between Cord Blood America, Inc. and Gecko Media, Inc. (1)                   
|        |  |             |                                                                                                                                 
|10.5    |  |             | License Agreement by and between Cord Partners, Inc. and Premier Office Centers, LLC (2)                                        
|        |  |             |                                                                                                                                 
|10.6    |  |             | Purchase and Sale of Future Receivables Agreement between AdvanceMe, Inc. and Cord Partners, Inc. (2)                           
|        |  |             |                                                                                                                                 
|10.7    |  |             | Promissory Note dated August 12, 2004 made by Cord Blood America, Inc. to the order of Thomas R. Walkey (2)                     
|        |  |             |                                                                                                                                 
|10.8    |  |             | Loan Agreement dated September 17, 2004 by and between Cord Blood America, Inc. and Thomas R. Walkey (3)                        
|        |  |             |                                                                                                                                 
|10.9    |  |             | Promissory Note dated January 17, 2005 made by CBA Professional Services, Inc. to the order of Joseph R. Vicente (4)            
|        |  |             |                                                                                                                                 
|10.10   |  |             | Exchange Agreement dated February 28, 2005 by and between Cord Blood America, Inc. and Career Channel, Inc. (5)                 
|        |  |             |                                                                                                                                 
|10.10   |  |             | Standby Equity Distribution Agreement dated March 22, 2004 between Cornell Capital Partners, LP and Cord Blood America, Inc. (6)
|        |  |             |                                                                                                                                 



26



---



|      |  |  |                                                                                                                                                        |  |  |  |  |  |  |  |  |  | 
|----- |  |  | ------------------------------------------------------------------------------------------------------------------------------------------------------ |  |  |  |  |  |  |  |  |  | 
|10.12 |  |  | Placement Agent Agreement dated March 22, 2005 between Newbridge Securities Corporation, Cornell Capital Partners, LP and Cord Blood America, Inc. (6)
|      |  |  |                                                                                                                                                       
|10.13 |  |  | Registration Rights Agreement dated March 22, 2004 between Cornell Capital Partners, LP and Cord Blood America, Inc. (6)                              
|      |  |  |                                                                                                                                                       
|10.14 |  |  | Escrow Agreement dated March 22, 2004 between Cord Blood America, Inc., Cornell Capital Partners, LP and David Gonzalez, Esq. (6)                     
|      |  |  |                                                                                                                                                       
|      |  |  |                                                                                                                                                        | 
|10.15 |  |  | Promissory Note to Cornell Capital Partners for $350,000 (7)                                                                                          
|      |  |  |                                                                                                                                                       
|10.16 |  |  | Warrant for 1,000,000 shares of common stock to Cornell Capital Partners (7)                                                                          
|      |  |  |                                                                                                                                                       
|10.17 |  |  | Pledge and Escrow Agreement with Cornell Capital Partners (7)                                                                                         
|      |  |  |                                                                                                                                                       
|10.18 |  |  | Exchange Agreement with Family Marketing Inc. (8)                                                                                                     
|      |  |  |                                                                                                                                                       
|10.19 |  |  | Amended and Restated Promissory Note with Cornell Capital Partners for $600,000 (9)                                                                   
|      |  |  |                                                                                                                                                       
|10.20 |  |  | Amendment Agreement to a Promissory Note with Cornell Capital Partners (10)                                                                           
|      |  |  |                                                                                                                                                       
|10.21 |  |  | Promissory Note to Cornell Capital Partners for $500,000 (11)                                                                                         
|      |  |  |                                                                                                                                                       
|10.22 |  |  | Warrant to Purchase Common Stock by Cornell Capital Partners (12)                                                                                     
|      |  |  |                                                                                                                                                       
|10.23 |  |  | Security Agreement between Family Marketing Inc. and Cornell Capital Partners (12)                                                                    
|      |  |  |                                                                                                                                                       
|10.24 |  |  | Security Agreement between Career Channel Inc. and Cornell Capital Partners (12)                                                                      
|      |  |  |                                                                                                                                                       
|10.25 |  |  | Security Agreement between CBA Professional Services Inc. and Cornell Capital Partners (12)                                                           
|      |  |  |                                                                                                                                                       
|10.26 |  |  | Security Agreement between CBA Properties Inc. and Cornell Capital Partners (12)                                                                      
|      |  |  |                                                                                                                                                       
|10.27 |  |  | Security Agreement between Cord Blood America Inc. and Cornell Capital Partners (12)                                                                  
|      |  |  |                                                                                                                                                       
|10.28 |  |  | Security Agreement between Cord Partners Inc. and Cornell Capital Partners (12)                                                                       
|      |  |  |                                                                                                                                                       
|10.29 |  |  | Pledge and Escrow Agreement by Cord Blood America, Inc, Cornell Capital Partners, and David Gonzalez, Esq. (12)                                       
|      |  |  |                                                                                                                                                       
|10.30 |  |  | Insider Pledge and Escrow Agreement by Cornell Capital Partners, Cord Blood America, Inc., Matthew L. Schissler, and David Gonzalez, Esq. (12)        
|      |  |  |                                                                                                                                                       
|10.31 |  |  | Investor Registration Rights Agreement between Cord Blood America, Inc. and Cornell Capital Partners (12)                                             
|      |  |  |                                                                                                                                                       
|10.32 |  |  | Securities Purchase Agreement between Cord Blood America, Inc. and Cornell Capital Partners (12)                                                      
|      |  |  |                                                                                                                                                       
|10.33 |  |  | Warrant to Purchase Common Stock by Cornell Capital Partners (12)                                                                                     
|      |  |  |                                                                                                                                                       
|10.34 |  |  | Secured Convertible Debenture issued by Cord Blood America, Inc. to Cornell Capital Partners (12)                                                     
|      |  |  |                                                                                                                                                       
|10.35 |  |  | Secured Convertible Debenture issued by Cord Blood America, Inc. to Cornell Capital Partners (13)                                                     
|      |  |  |                                                                                                                                                       
|10.36 |  |  | Amended and Restated Secured Convertible Debenture issued by Cord Blood America, Inc. to Cornell Capital Partners (13)                                
|      |  |  |                                                                                                                                                       
|10.37 |  |  | Termination Agreement between Cord Blood America, Inc. to Cornell Capital Partners (13)                                                               
|      |  |  |                                                                                                                                                       
|10.38 |  |  | Employment Agreement dated January 1, 2006 by and between Cord Blood America, Inc. and Matthew L. Schissler (14)                                      
|      |  |  |                                                                                                                                                       
|10.39 |  |  | Consulting Agreement dated January 1, 2006 by and between Cord Blood America, Inc. and Stephanie Schissler (14)                                       
|      |  |  |                                                                                                                                                       



27



---



|      |  |  |                                                                                                                      |  |  |  |  |  |  |  |  |  | 
|----- |  |  | -------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  |  |  |  |  | 
|      |  |  |                                                                                                                     
|10.40 |  |  | Stock Option Schedule dated January 1, 2006 by and between Cord Blood America, Inc. and Stephanie Schissler (14)    
|      |  |  |                                                                                                                     
|10.41 |  |  | Asset Purchase Agreement between Cord Partners, Inc. and Cryobank for Oncologic and Reproductive Donors, Inc. (15)  
|      |  |  |                                                                                                                     
|10.42 |  |  | Board Compensation Plan (16)                                                                                        
|      |  |  |                                                                                                                     
|10.42 |  |  | Web Development and Maintenance Agreement with Gecko Media, Inc. (17)                                               
|      |  |  |                                                                                                                     
|10.43 |  |  | Investment Banking Agreement with Kings Pointe Capital, Inc. (18)                                                   
|      |  |  |                                                                                                                     
|10.44 |  |  | Investment Banking Agreement with FAE Holdings, Inc. (18)                                                           
|      |  |  |                                                                                                                     
|10.45 |  |  | Investment Banking Agreement with First SB Partners, Inc. (18)                                                      
|      |  |  |                                                                                                                     
|10.46 |  |  | Agreement with Cornell Capital Partners, LP (19)                                                                    
|      |  |  |                                                                                                                     
|10.47 |  |  | Subscription Agreement with Strategic Working Capital Fund, L.P. (20)                                               
|      |  |  |                                                                                                                     
|10.48 |  |  | Promissory Note for the Benefit of Strategic Working Capital Fund, L.P. (20)                                        
|      |  |  |                                                                                                                     
|10.49 |  |  | Funds Escrow Agreement with Strategic Working Capital Fund, L.P. (20)                                               
|      |  |  |                                                                                                                     
|10.50 |  |  | Severance Agreement, dated September 8, 2006, between the Company and Sandra Anderson (21)                          
|      |  |  |                                                                                                                     
|10.51 |  |  | Stock Purchase Agreement, dated September 5, 2006, between the Company and Noah Anderson (21)                       
|      |  |  |                                                                                                                     
|10.52 |  |  | Asset Purchase Agreement, executed October 13, 2006, between the Company and CorCell, Inc. (22)                     
|      |  |  |                                                                                                                     
|10.53 |  |  | Stock Purchase Agreement, executed October 13, 2006, between the Company and Independence Blue Cross (22)           
|      |  |  |                                                                                                                     
|10.54 |  |  | Existing Samples Purchase Agreement, executed October 13, 2006, between the Company and Independence Blue Cross (22)
|      |  |  |                                                                                                                     
|10.55 |  |  | Registration Rights Agreement, executed October 13, 2006, between the Company and Independence Blue Cross (22)      
|      |  |  |                                                                                                                     
|10.56 |  |  | Existing Samples Purchase Agreement, executed October 13, 2006, between the Company and CorCell, Inc. (22)          
|      |  |  |                                                                                                                     
|10.57 |  |  | Bill of Sale, executed October 13, 2006, between the Company and CorCell, Inc. (22)                                 
|      |  |  |                                                                                                                     
|10.58 |  |  | Assumption Agreement, executed October 13, 2006, between the Company and CorCell, Inc. (22)                         
|      |  |  |                                                                                                                     
|10.59 |  |  | Trademark Assignment, executed October 13, 2006, between the Company and CorCell, Inc. (22)                         
|      |  |  |                                                                                                                     
|10.60 |  |  | Non-Competition Agreement, executed October 13, 2006, between the Company and CoCell, Inc. (22)                     
|      |  |  |                                                                                                                     
|10.61 |  |  | Office Sublease, executed October 13, 2006, between the Company and CoCell, Inc. (22)                               
|      |  |  |                                                                                                                     
|10.62 |  |  | Employment Agreement Assignment, executed October 13, 2006, between the Company and Bruce Ditnes (22)               
|      |  |  |                                                                                                                     
|      |  |  |                                                                                                                     
|10.63 |  |  | Employment Agreement Assignment, executed October 13, 2006, between the Company and Jill Hutt (22)                  
|      |  |  |                                                                                                                     
|10.64 |  |  | Employment Agreement Assignment, executed October 13, 2006, between the Company and Antonia Lafferty (22)           
|      |  |  |                                                                                                                     
|10.65 |  |  | Employment Agreement Assignment, executed October 13, 2006, between the Company and Marcia Laleman (22)             
|      |  |  |                                                                                                                     
|10.66 |  |  | Employment Agreement Assignment, executed October 13, 2006, between the Company and Marion Malone (22)              
|      |  |  |                                                                                                                     
|10.67 |  |  | Employment Agreement Assignment, executed October 13, 2006, between the Company and George Venianakis (22)          
|      |  |  |                                                                                                                     



28



---



|      |  |  |                                                                                                                                                                                                                                                       |  |  |  |  |  |  |  |  |  | 
|----- |  |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  |  |  |  |  | 
|10.68 |  |  | Technology License Agreement, executed October 13, 2006, between the Company and Vita34AG (22)                                                                                                                                                       
|      |  |  |                                                                                                                                                                                                                                                      
|10.69 |  |  | Agreement by and between Cord Blood America, Inc and Cornell Capital Partners, LP executed October 13, 2006 (23)                                                                                                                                     
|      |  |  |                                                                                                                                                                                                                                                      
|10.70 |  |  | Promissory Note dated October 23, 2006 between the Company and Bergen Regional Community Blood Services (24)                                                                                                                                         
|      |  |  |                                                                                                                                                                                                                                                      
|10.71 |  |  | Stock Pledge, Escrow and Security Agreement dated October 23, 2006 for the benefit Bergen Regional Community Blood Services (25)                                                                                                                     
|      |  |  |                                                                                                                                                                                                                                                      
|10.72 |  |  | Placement Agency Agreement ,dated December 18, 2006, by and between the Company and Stonegate Securities, Inc. (26)                                                                                                                                  
|      |  |  |                                                                                                                                                                                                                                                      
|10.73 |  |  | Consulting Agreement dated June 1, 2007, by and between Cord Blood America, Inc. and Midtown Partners & Co., LLC (27)                                                                                                                                
|      |  |  |                                                                                                                                                                                                                                                      
|10.74 |  |  | Exclusive Consulting Agreement, dated May 21, 2007, by and between Cord Blood America, Inc. and Jean R. Fuselier, Sr. (27)                                                                                                                           
|      |  |  |                                                                                                                                                                                                                                                      
|10.75 |  |  | Exclusive Consulting Agreement, dated May 21, 2007, by and between Fuselier Holding, LLC and Cord Blood America, Inc. (27)                                                                                                                           
|      |  |  |                                                                                                                                                                                                                                                      
|10.76 |  |  | Promissory Note in the amount of $121,500 to Stephanie Schissler (28)                                                                                                                                                                                
|      |  |  |                                                                                                                                                                                                                                                      
|10.77 |  |  | Promissory Note in the amount of $76,950 to Stephanie Schissler (28)                                                                                                                                                                                 
|      |  |  |                                                                                                                                                                                                                                                      
|10.78 |  |  | Promissory Note in the amount of $25,650 to Matthew L. Schissler (28)                                                                                                                                                                                
|      |  |  |                                                                                                                                                                                                                                                      
|10.79 |  |  | Pledge Agreement, dated September 28, 2007, between Cord Blood America, Inc., and Stephanie Schissler, relating to note in the amount of $121,500 (28)                                                                                               
|      |  |  |                                                                                                                                                                                                                                                      
|10.80 |  |  | Pledge Agreement, dated September 28, 2007, between Cord Blood America, Inc., and Stephanie Schissler, relating to note in the amount of $76,950 (28)                                                                                                
|      |  |  |                                                                                                                                                                                                                                                      
|10.81 |  |  | Pledge Agreement, dated September 28, 2007, between Cord Blood America, Inc., and Matthew L. Schissler (28)                                                                                                                                          
|      |  |  |                                                                                                                                                                                                                                                      
|10.82 |  |  | Asset Purchase Agreement, dated August 20, 2007, among Cord Partners, Inc., Cord Blood America, Inc., and CureSource, Inc. (29)                                                                                                                      
|      |  |  |                                                                                                                                                                                                                                                      
|      |  |  |                                                                                                                                                                                                                                                      
|10.83 |  |  | Form of Senior Convertible Note (30)                                                                                                                                                                                                                 
|      |  |  |                                                                                                                                                                                                                                                      
|10.84 |  |  | Form of Warrant to Purchase Common Stock (30)                                                                                                                                                                                                        
|      |  |  |                                                                                                                                                                                                                                                      
|10.85 |  |  | Secured Original Issue Discount Debenture, by CorCell (30)                                                                                                                                                                                           
|      |  |  |                                                                                                                                                                                                                                                      
|10.86 |  |  | Common Stock Purchase Warrant, dated November 26, 2007, by Cord Blood America, Inc. (30)                                                                                                                                                             
|      |  |  |                                                                                                                                                                                                                                                      
|10.87 |  |  | Securities Purchase Agreement, dated November 26, 2007, by and among Cord Blood America, Inc., Enable Growth Partners LP, and the other Purchasers (30)                                                                                              
|      |  |  |                                                                                                                                                                                                                                                      
|10.88 |  |  | Security Agreement, dated November 26, 2007, among Cord Blood American, Inc. and the Purchasers (30)                                                                                                                                                 
|      |  |  |                                                                                                                                                                                                                                                      
|10.89 |  |  | Registration Rights Agreement, dated November 26, 2007, among Cord Blood America, Inc. and the Purchasers (30)                                                                                                                                       
|      |  |  |                                                                                                                                                                                                                                                      
|10.90 |  |  | Second Amendment, dated November 26, 2007, to the Securities Purchase Agreement, dated as of February 14, 2007, as amended by the First Amendment, dated as of April 9, 2007, by and among CorCell, Cord Blood America, Inc., and Shelter Island (30)
|      |  |  |                                                                                                                                                                                                                                                      
|10.91 |  |  | CorCell Security Agreement, dated as of November 26, 2007, by and between Cord Blood America, Inc., and Shelter Island (30)                                                                                                                          



29



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|      |  |  |                                                                                                                                                                                                                   |  |  |  |  |  |  |  |  |  | 
|----- |  |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  |  |  |  |  |  |  |  |  | 
|      |  |  |                                                                                                                                                                                                                  
|10.92 |  |  | Put Option Agreement, dated as of November 26, 2007, by and between Cord Blood America, Inc. and Shelter Island (30)                                                                                             
|      |  |  |                                                                                                                                                                                                                  
|10.93 |  |  | Subordination Agreement, dated November 26, 2007, by and between Cord Blood America, Inc., CorCell, Career Channel, Inc., the Purchasers and Shelter Island (30)                                                 
|      |  |  |                                                                                                                                                                                                                  
|10.94 |  |  | Manufacturing Support Services Agreement, dated August 1, 2007, by and between Cord Blood American, Inc. and Progenitor Cell Therapy, LLC (31)                                                                   
|      |  |  |                                                                                                                                                                                                                  
|10.95 |  |  | Form of Sublease, dated October 1, 2006, by and between CorCell, Inc. and Cord Blood America, Inc. (31)                                                                                                          
|      |  |  |                                                                                                                                                                                                                  
|21    |  |  | List of Subsidiaries (32)                                                                                                                                                                                        
|      |  |  |                                                                                                                                                                                                                  
|23.1  |  |  | Consent of Rose, Snyder & Jacobs (32)                                                                                                                                                                            
|      |  |  |                                                                                                                                                                                                                  
|23.2  |  |  | Consent of Sichenzia Ross Friedman Ference LLP (included in Exhibit 5.1)                                                                                                                                         
|      |  |  |                                                                                                                                                                                                                  
|31.1  |  |  | Certification of the registrants Chief Executive Office



 pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Filed Herewith)                                                                          
|      |  |  |                                                                                                                                                                                                                  
|31.2  |  |  | Certification of the registrants Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 (Filed Herewith)                                                                             
|      |  |  |                                                                                                                                                                                                                  
|32.1  |  |  | Certification of the Companys Chief Executive Officer and

Chief




 Financial Officer pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Filed Herewith)



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



(2) Filed as an exhibit to Amendment No. 1 to Form 10-SB filed on August 23, 2004.



(3) Filed as an exhibit to Amendment No. 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 28, 2005.



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



(8) Filed as an exhibit to Current Report on Form 8-K filed on May 3, 2005.



(9) Filed as an exhibit to Current Report on Form 8-K filed on June 24, 2005.



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



(11) Filed as an exhibit to Current Report on Form 8-K filed on July 21, 2005.



(12) Filed as an exhibit to Current Report on Form 8-K filed on September 12, 2005.



(13) Filed as an exhibit to Current Report on Form 8-K filed on December 23, 2005.



(14) Filed as an exhibit to Current Report on Form 8-K filed on January 6, 2006.



(15) Filed as an exhibit to Current Report on Form 8-K filed on January 18, 2006.



(16) Filed as an exhibit to Current Report on Form 8-K filed on February 8, 2006.





30



---

(17) Filed as an exhibit to Current Report on Form 8-K filed on May 5, 2006.



(18) Filed as an exhibit to Current Report on Form 8-K filed on June 1, 2006.



(19) Filed as an exhibit to Current Report on Form 8-K filed on June 29, 2006.



(20) Filed as an exhibit to Current Report on Form 8-K filed on August 2, 2006.



(21) Filed as an exhibit to Current Report on Form 8-K filed on September 11, 2006.



(22) Filed as an exhibit to Current Report on Form 8-K filed on October 13, 2006.



(23) Filed as an exhibit to Current Report on Form 8-K filed on October 17, 2006.



(24) Filed as an exhibit to Current Report on Form 8-K filed on October 27, 2006.



(25) Filed as an exhibit to Current Report on Form 8-K filed on October 23, 2006.



(26) Filed as an exhibit to Current Report on Form 8-K filed on December 29, 2006.



(27) Filed as an exhibit to Current Report on Form 8-K filed on June 6, 2007.



(28) Filed as an exhibit to Current Report on Form 8-K filed on October 3, 2007.



(29) Filed as an exhibit to Current Report on Form 8-K filed on August 21, 2007.



(30) Filed as an exhibit to Current Report on Form 8-K filed on November 30, 2007.



(31) Filed as an exhibit to Registration Statement on Form SB-2 filed on December 28, 2007.



(32) Filed as an exhibit to Post-Effective Amendment No. 1 to Registration Statement on Form SB-2 filed on January 25, 2008.





31



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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES



The following table sets forth the aggregate fees billed to us by our principal accountant, Rose, Snyder, Jacobs for the periods indicated.



|               |  |      |         |      |   |       
|-------------- |  | ---- | ------- | ---- | - | ------
|               |  | 2007 |         | 2006
|Audit fees (1) |  | $    | 139,540 |      | $ | 83,450
|Tax fees       |  |      | --      |      |   | 1,250 
|Total          |  | $    | 139,540 |      | $ | 84,750



(1)  Includes fees for audit committee reports and out of pocket expenses.



During 2005, we did not have an audit committee and therefore, the above services were unable to be pre-approved using any audit committee pre-approval policies and procedures. As of April 3, 2006, our board of directors has determined that Cord Blood has one audit committee financial expert, Mr. Timothy McGrath, and two committee members serving on its audit committee. On April 6, 2006, the board adopted its written audit committee charter.



32



---

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.



Date:  




October 1,




2008

| |                          |                                                                                                            
| | ------------------------ | -----------------------------------------------------------------------------------------------------------
| | CORD BLOOD AMERICA, INC.
| |                          |                                                                                                            
| |                          |                                                                                                            
| | By:                      | /s/ MATTHEW L. SCHISSLER                                                                                   
| |                          | Matthew L. Schissler                                                                                       
| |                          | Chief Executive Officer, Principal Executive Officer,Principal Accounting Officer and Chairman of the Board



Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.



|                         |  |                           |  |                     
|------------------------ |  | ------------------------- |  | --------------------
|Signature                |  | Title                     |  | Date                
|                         |  |                           |  |                     
|/s/ MATTHEW L. SCHISSLER |  | Chairman of the Board and |  | October 1,




 2008
|Matthew L. Schissler     |  | Chief Executive Officer   |  |                     
|                         |  |                           |  |                     
|/s/ JOSEPH VICENTE       |  | Director                  |  | October 1,




 2008
|Joseph Vicente           |  |                           |  |                     
|                         |  |                           |  |                     
|/s/ TIMOTHY MCGRATH      |  | Director                  |  | October 1,




2008 
|Timothy McGrath          |  |                           |  |                     
|                         |  |                           |  |                     
|/s/ RICK NEESON          |  | Director                  |  | October 1,




2008 
|Rick Neeson              |  |                           |  |                     





33