Summary of CORD BLOOD AMERICA, INC.

MANAGEMENT'S DISCUSSION AND ANALYSIS

Forward Looking Statements

In addition to the historical information contained herein, we make statements in this Quarterly Report on Form 10-QSB that are forward-looking statements. Sometimes these statements will contain words such as "believes," "expects," "intends," "should," "will," "plans," and other similar words. Forward-looking statements include, without limitation, our ability to increase income streams, to grow revenue and earnings, and to obtain additional cord blood banking revenue streams. Actual results could differ materially from those projected in the forward-looking statements as a result of a number of risks and uncertainties.

The following information should be read in conjunction with our June 30, 2009 consolidated financial statements and related notes thereto included elsewhere in the quarterly report and with our consolidated financial statements and notes thereto for the year ended December 31, 2008 and the related "Management's Discussion and Analysis of Financial Condition and Results of Operations" contained in our annual Report on Form 10-K for the year ended December 31, 2008. We also urge you to review and consider our disclosures describing various risks that may affect our business, which are set forth under the heading "Risk Factors Related to our Business" in our annual Report on Form 10-K for the year ended December 31, 2008.

Summary and Outlook of the Business

CBAI is engaged in the business of collecting, testing, processing and preserving umbilical cord blood, thereby allowing families to preserve cord blood at the birth of a child for potential use in future stem cell therapy. CBAI is organized as a holding company. Its subsidiaries include Cord Partners, Inc., CorCell Co. Inc., CorCell Ltd., ("Cord"), CBA Professional Services, Inc. D/B/A BodyCells, Inc. ("BodyCells"), CBA Properties, Inc. ("Properties"), and Career Channel Inc, D/B/A Rainmakers International ("Rain") .

The bulk of CBAI business is conducted in Cord which conducts its umbilical cord blood stem cell preservation, and in Rain, which conducts its television and radio advertising operations. BodyCells is in development stage and is 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 use in stem cell therapy. Properties was formed to hold the corporate trademarks and any other intellectual property of the CBAI and its subsidiaries.

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. 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 subcontractor. We provide the following services to each customer.

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 intend to continue our organic growth in this business through continued improvement of internal processes, continued improvement and expansion of our relationships with health insurance providers, and through continuing efforts to leverage those relationships in the pregnancy programs with those providers. We also plan to build additional sales channels through 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.

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

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 for clients, 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 subcontractors. Our on-hold advertising is placed on a client's telephone system and production for this product is outsourced to subcontractors. Motor sports sponsorship is placed on vehicles in various motor sports circuits.

In December, 2007, Rain began a significant shift in its business development strategy. Rain's revenues prior to January 1, 2008 were largely reliant on a few customers. Rain decided that a business model with smaller contracts and a larger volume of customers would better serve the marketplace and steady the large swings in revenues for the segment. In 2008, the senior sales person of Rain departed. The Company is re-analyzing its strategy. Rain believes that under the current economic climate, it will wait to decide whether or not to re-engage actively in the industry in 2010. In the interim, CBAI is not focused on the short term growth of Rain.

BodyCells

We are seeking opportunities by acquisition or internal growth for establishment of this business. BodyCells' business plan contemplates a model which would provide products and services to facilitate the collecting, processing and preserving of peripheral blood and adipose tissue stem cells thus allowing individuals to privately preserve their stem cells, for potential future use in stem cell therapy. BodyCells is in a start-up mode at this date.

Results of Operations for the Six-Months Ended June 30, 2009

For the six months ended June 30, 2009, our total revenue decreased approximately $0.6 million, or 26.9% to $1.8 million. Rain's revenues decreased approximately $0.5 million, or 71.2%, due to the change in the Rain business model as well as our management decision to deemphasize this business.

Cord's revenues decreased $.2 million or 10% to 1.6 million because of general economic conditions which have slowed consumer spending and cutbacks in marketing and advertising due to a lack of capital.

Cost of services decreased 28.8% or by $0.3 million as a result of lower revenues, but Gross Profit increased from 55.4% of revenues to 56.5%, due to a significantly higher proportion of revenues coming from the higher margin Cord business. The Company anticipates that through the continued growth and expansion of its Cord business, they will continue to benefit from economies of scale in that business segment.

Administrative and selling expenses decreased by approximately $0.1 million or 4.5% from the prior comparative period to $1.8 million. The Company reduced its salaries by $0.2 million as compared to the comparative period, and reduced its marketing costs and office expenses by approximately $0.1 million, as the Company reduced its expenses in its Rain division. These reductions were partially offset by an increase in professional fees and public company costs of approximately $0.2 million, primarily due to the Company's costs associated with acquisition of additional working capital. The Company has had to raise additional debt to finance both its acquisitions as well as its operating losses. In March 2009, the Company's shareholders authorized a significant increase in the Company's authorized capital. This has allowed the Company to convert a significant amount of debt. As a result, the interest, financing costs and changes in derivative liabilities have decreased from $3.2 million to $2.8 million, or 11.8% as compared to the comparative period. All interest charges during the period have been accrued.

Our net loss decreased by $0.1 million, or 3.3%, from the prior comparative period.

Results of Operations for the Three-Months Ended June 30, 2009

For the three months ended June 30, 2009, our total revenue decreased approximately $0.2 million, or 23% to approximately $0.8 million. Rain's revenues decreased approximately $0.2 million, or 92.5%, for the reasons outlined above. Cord's revenues decreased $0.1 million, or 8.3%, to approximately $0.8 million, because of significant cutbacks in marketing and advertising. Cord remains focused on strategic organic growth and accretive acquisition strategies, which management hopes will reduce or eliminate continuing losses and negative cash flow.

Cost of services decreased 27.4% or $0.2 million as a result of lower revenues, but Gross Profit decreased from 64.9% of revenues to 61.2%, due to a significantly higher proportion of revenues coming from the higher margin Cord business. The Company anticipates that through the continued growth and expansion of its Cord business, Cord will be able to benefit from economies of scale in that business segment.

Administrative and selling expenses increased by approximately $0.1 million, or 19.0% from the prior comparative period to $1.0 million. The Company had an increase in professional fees and public company costs of approximately $0.2 million, primarily due to the Company's costs associated with its search for additional capital, offset by a decrease of approximately $0.1 million in wages and marketing costs. The Company has had to raise additional debt to finance both its acquisitions as well as its operating losses. In March 2009, the Company's shareholders authorized a significant increase in the Company's authorized capital. This has allowed the Company to convert a significant amount of debt. Consequently, interest, financing costs and changes in derivative liabilities decreased 40.4%, from $2.3 million to $1.4 million in the comparative period. All interest charges during the period have been accrued.

Our net loss decreased by $0.6 million, or 23.9% from the prior comparative period

Liquidity and Capital Resources

We have experienced net losses of $3.6 million and $3.7 million for the six months ended June 30, 2009 and 2008, respectively. At June 30, 2009, we had $324,549 in cash. We currently collect cash receipts from operations through both of our subsidiaries: Cord and Rain. Cord's cash flows from operations are not currently sufficient to fund operations in combination with its corporate expenses. Because of this shortfall, we have had to obtain additional capital through other sources as discussed in Note 4, 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 will likely continue to experience net negative cash flows

from operations. We hope to be able to obtain additional financing to fund operations through equity offerings and borrowings to the extent necessary to provide the necessary 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 could,

depending on the terms of its placement, 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 and services, we could be forced to curtail or possibly cease operations.

In June, 2008, the Company announced the signing of a Securities Purchase Agreement with Tangiers Investors, LP, whereby Tangiers may purchase up to $4 million of the Company's common stock. In the first six months of the year, Tangiers has purchased $325,000 of common stock. In May, 2009, the Company announced the signing of a Secured & Collateralized Convertible Promissory Note for $1.3 million. The Company has drawn $325,000 of this Note as of June 30, 2009. On July 2, 2009, the Company executed a Preferred Stock Purchase Agreement with Optimus Capital Partners, LLC pursuant to which it has secured a $7.5 million capital commitment which may be drawn down in increments, under certain conditions. On August 3, 2009, the company filed its registration statement for these shares.

ITEM 4T.

CONTROLS AND PROCEDURES

Evaluation of Disclosure 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"). The Company's management, including the principal executive officer, the principal operations officer, and the principal financial officer, have reviewed and evaluated the effectiveness of our disclosure controls and procedures as of June 30, 2009. Following this review and evaluation, management collectively determined that our disclosure controls and procedures were 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. We are continuing our efforts in these regards in order to fully remedy previously reported material weaknesses and to ensure that all of our controls and procedures are adequate and effective. On July 2, 2009, the Company executed a Preferred Stock Purchase Agreement with Optimus Capital Partners, LLC pursuant to which it has secured a $7.5 million capital commitment which may be drawn down in increments, under certain conditions. If we are able to draw down most of this commitment, we expect to be in a position to add additional staff, which will allow us strengthen some of our controls.

Changes in Internal Control over Financial Reporting

We assessed the effectiveness of our internal control over financial reporting as of December 31, 2008. 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, 2008, our internal control over financial reporting was not effective.

There were no significant changes in the Company's internal controls over financial reporting or in other factors during the six months ended June 30, 2009 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. We are continuing our efforts in these regards in order to fully remedy previously reported material weaknesses and to ensure that all of our controls and procedures are adequate and effective. Any failure to implement and maintain improvements in the controls over our financial reporting could cause us to fail to meet our reporting obligations under the SEC's rules and regulations. On July 2, 2009, the Company executed a Preferred Stock Purchase Agreement with Optimus Capital Partners, LLC pursuant to which it has secured a $7.5 million capital commitment which may be drawn down in increments, under certain conditions. If we are able to draw down most of this commitment, we expect to be in a position to add additional staff, which will allow us strengthen some of our controls. Any failure to improve our internal controls to address the weaknesses we have identified could also cause investors to lose confidence in our reported financial information, which could have a negative impact on the trading price of our common stock. It should be noted that the design of any system of controls is based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions, regardless of how remote.