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U.S. SECURITIES AND EXCHANGE COMMISSION

WASHINGTON D.C. 20549

FORM 10-Q

(Mark One)

☒ Quarterly report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

For the quarterly period ended August 31, 2025

☐ Transition report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934.

For the transition period from to

Commission File Number 001-40767

CRYO-CELL INTERNATIONAL, INC.

(Exact name of Registrant as Specified in its Charter)

     Delaware

     22-3023093

     (State or other Jurisdiction of
Incorporation or Organization)

     (I.R.S. Employer
Identification No.)

     700 Brooker Creek Blvd.  Oldsmar, FL 34677

     (Address of Principal Executive Offices) (Zip Code)
 
(813) 749-2100

     (Issuer's phone number, including area code)

    

(Former name, former address and former fiscal year, if changed since last report).

Securities registered pursuant to Section 12(b) of the Act:

     Title of each class

     Trading
Symbol(s)

     Name of each exchange
on which registered

     Common Stock, $0.01 par value

     CCEL

     NYSE American LLC

Check whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files. Yes ☒ No ☐ Not Applicable ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See definition of “large accelerated filer,” “accelerated filer,” “small reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act. (Check one):


Large accelerated filer	☐	Accelerated filer	☐

Non-accelerated filer	☑	Smaller reporting company	☑

		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act) ☐

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. As of October 15, 2025, 8,055,150 shares of $0.01 par value common stock were outstanding.

CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES

TABLE OF CONTENTS


	PAGE
PART I - FINANCIAL INFORMATION (UNAUDITED)

Item 1. Financial Statements

Consolidated Balance Sheets	3

Consolidated Statements of Income	4

Consolidated Statements of Cash Flows	5

Consolidated Statements of Stockholders’ Deficit	6

Notes to Consolidated Financial Statements	7

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	27

Item 3. Quantitative and Qualitative Disclosures about Market Risk	36

Item 4. Controls and Procedures	36

PART II - OTHER INFORMATION	38

Item 1. Legal Proceedings	38

Item 1A. Risk Factors	38

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	52

Item 3. Defaults Upon Senior Securities	52

Item 4. Mine Safety Disclosures	52

Item 5. Other Information	52

Item 6. Exhibits	53

SIGNATURES	54

CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS


	(Unaudited)
	August 31,			November 30,
	2025			2024
ASSETS
Current Assets
Cash and cash equivalents	$	265,207		$	560,960
Marketable securities		2,956,238			2,935,183
Accounts receivable (net of allowance for
doubtful accounts of $4,416,201 and $4,266,406, respectively)		6,833,380			7,309,094
Prepaid expenses		617,930			637,055
Inventory, current portion		655,254			657,703
Other current assets		344,994			454,598
Total current assets		11,673,003			12,554,593
Property and Equipment-net		21,199,002			21,894,263
Other Assets
Intangible assets, net		874,229			921,254
Inventory, net of current portion		4,864,834			4,942,115
Goodwill		1,941,411			1,941,411
Deferred tax assets		20,802,023			20,802,023
Operating lease right-of-use asset		906,848			806,339
Deposits and other assets, net		907,779			815,635
Total other assets		30,297,124			30,228,777
Total assets	$	63,169,129		$	64,677,633
LIABILITIES AND STOCKHOLDERS' DEFICIT
Current Liabilities
Accounts payable	$	2,611,921		$	1,882,274
Accrued expenses		2,284,575			5,809,872
Note payable		179,187			170,488
Line of credit		3,200,000			3,520,000
Current portion of operating lease liability		434,604			428,334
Deferred revenue		9,741,319			9,788,574
Total current liabilities		18,451,606			21,599,542

Other Liabilities
Deferred revenue, net of current portion		49,842,932			46,556,990
Note payable, net of current portion and debt issuance costs		8,206,768			8,310,045
Operating lease long-term liability		577,202			505,053
Long-term liability - revenue sharing agreements		875,000			875,000
Other liabilities		47,020			47,020
Total other liabilities		59,548,922			56,294,108
Total liabilities		78,000,528			77,893,650

Commitments and contingencies (Note 9)		—			—

Stockholders' Deficit
Preferred stock ($.01 par value, 500,000 authorized and none issued and outstanding)		—			—
Series A Junior participating preferred stock ($.01 par value, 20,000 authorized and none issued and outstanding)		—			—
Common stock ($.01 par value, 20,000,000 authorized; 14,877,119 issued and 8,055,150 outstanding as of August 31, 2025 and 14,869,619 issued and 8,082,159 outstanding as of November 30, 2024)		148,771			148,696
Additional paid-in capital		44,665,693			44,268,469
Treasury stock, at cost		(25,025,058	)		(24,855,556	)
Accumulated deficit		(34,620,805	)		(32,777,626	)
Total stockholders' deficit		(14,831,399	)		(13,216,017	)
Total liabilities and stockholders' deficit	$	63,169,129		$	64,677,633

The accompanying notes are an integral part of these consolidated financial statements.

CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)


	For the Three Months Ended						For the Nine Months Ended
	August 31,			August 31,			August 31,			August 31,
	2025			2024			2025			2024
Revenue:
Processing and storage fees	$	7,820,877		$	7,945,470		$	23,558,484		$	23,716,492
Public banking revenue		4,119			120,609			128,886			205,799
Product revenue		436			636			35,785			39,470
Total revenue		7,825,432			8,066,715			23,723,155			23,961,761
Costs and Expenses:
Cost of sales		1,801,419			2,125,846			5,642,546			6,311,064
Selling, general and administrative expenses		3,876,159			4,162,487			12,772,301			12,514,616
Impairment of investment - Tianhe stock		—			—			—			308,000
Research, development and related engineering		61,625			193,933			291,479			937,907
Depreciation and amortization		185,693			194,559			567,648			287,543
Total costs and expenses		5,924,896			6,676,825			19,273,974			20,359,130
Operating Income		1,900,536			1,389,890			4,449,181			3,602,631
Other Income (Expense):
(Losses) gains on marketable securities		(193,886	)		522,458			(604,619	)		1,056,052
Gain on interest rate swap		—			—			—			105,887
Other income		17,565			981			34,562			1,181
Interest expense		(538,219	)		(533,464	)		(1,584,307	)		(1,119,196	)
Total other income (expense)		(714,540	)		(10,025	)		(2,154,364	)		43,924
Income before income tax expense		1,185,996			1,379,865			2,294,817			3,646,555
Income tax expense		(436,588	)		(328,186	)		(906,769	)		(1,382,845	)
Net income	$	749,408		$	1,051,679		$	1,388,048		$	2,263,710
Net income per common share - basic	$	0.09		$	0.13		$	0.17		$	0.28
Weighted average common shares outstanding - basic		8,057,780			8,061,946			8,073,303			8,151,967
Net income per common share - diluted	$	0.09		$	0.13		$	0.17		$	0.27
Weighted average common shares outstanding - diluted		8,073,654			8,173,535			8,126,614			8,241,488

The accompanying notes are an integral part of these consolidated financial statements.

CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	For the Nine Months Ended
	August 31,			August 31,
	2025			2024
Cash flows from operating activities:
Net income	$	1,388,048		$	2,263,710
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization expense		742,231			444,850
Impairment of investment - Tianhe stock		—			308,000
Loss on sale of property and equipment		48,304			—
Losses (gains) on marketable securities		604,619			(1,056,052	)
Unrealized gain on interest rate swap contract		—			(105,887	)
Compensatory element of stock options		374,198			631,435
Provision for doubtful accounts		780,197			918,488
Amortization of debt issuance costs		15,657			15,967
Amortization of operating lease right-of-use asset		295,654			237,299
Changes in assets and liabilities:
Accounts receivable		(304,483	)		(1,215,889	)
Prepaid expenses		19,125			102,898
Inventory		79,730			209,209
Other current assets		109,604			(26,529	)
Deposits and other assets, net		(92,144	)		(51,553	)
Accounts payable		741,407			(293,685	)
Accrued expenses		(3,525,297	)		(2,490,236	)
Operating lease liability		(317,744	)		(175,633	)
Other liabilities		—			3,829
Deferred revenue		3,238,687			4,133,696
Net cash from operating activities		4,197,793			3,853,917
Cash flows from investing activities:
Purchases of property and equipment		(163,249	)		(2,395,360	)
Sale of property and equipment		115,000			—
Payment of Duke license agreement		—			(1,066,667	)
Proceeds from liquidation of marketable securities		—			101,873
Purchases of marketable securities		(3,160,145	)		(1,759,828	)
Sale of marketable securities		2,522,711			1,358,732
Net cash used in investing activities		(685,683	)		(3,761,250	)
Cash flows used in financing activities:
Treasury stock purchases		(169,502	)		(1,423,871	)
Repayments of note payable		(110,235	)		(106,428	)
Repayment of line of credit		(7,120,000	)		(2,200,000	)
Proceeds from the exercise of stock options		23,101			1,002
Proceeds from line of credit		6,800,000			3,200,000
Dividends paid		(3,231,227	)		—
Proceeds from Swap termination		—			228,000
Net cash used in financing activities		(3,807,863	)		(301,297	)

Decrease in cash and cash equivalents		(295,753	)		(208,630	)
Cash and cash equivalents - beginning of period		560,960			406,067

Cash and cash equivalents - end of period	$	265,207		$	197,437

Supplemental non-cash operating activities:
Lease liability arising from right-of-use asset	$	396,163		$	100,932
Supplemental investing activities:
Construction costs payable	$	—		$	(880,348	)
Supplemental cash flow information:
Cash paid during the year for:
Interest	$	1,533,485		$	1,482,909
Income taxes	$	2,833,737		$	2,385,096

The accompanying notes are an integral part of these consolidated financial statements.

CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' DEFICIT

(Unaudited)


	For the Three Months Ended August 31, 2025
					Additional								Total
	Common Stock				Paid-In		Treasury			Accumulated			Stockholders'
	Shares		Amount		Capital		Stock			Deficit			Deficit

Balance at May 31, 2025		14,869,619	$	148,696	$	44,605,887	$	(24,944,175	)	$	(35,370,213	)	$	(15,559,805	)
Exercise of stock options		7,500		75		23,026								23,101
Compensatory element of stock options						36,780							$	36,780
Treasury stock								(80,883	)					(80,883	)
Net income											749,408		$	749,408
Balance at August 31, 2025		14,877,119	$	148,771	$	44,665,693	$	(25,025,058	)	$	(34,620,805	)	$	(14,831,399	)


	For the Nine Months Ended August 31, 2025
					Additional								Total
	Common Stock				Paid-In		Treasury			Accumulated			Stockholders'
	Shares		Amount		Capital		Stock			Deficit			Deficit
Balance at November 30, 2024		14,869,619	$	148,696	$	44,268,469	$	(24,855,556	)	$	(32,777,626	)	$	(13,216,017	)
Exercise of stock options		7,500		75		23,026								23,101
Compensatory element of stock options						374,198								374,198
Treasury stock								(169,502	)					(169,502	)
Dividends declared ($0.40 per share)											(3,231,227	)		(3,231,227	)
Net income											1,388,048			1,388,048
Balance at August 31, 2025		14,877,119	$	148,771	$	44,665,693	$	(25,025,058	)	$	(34,620,805	)	$	(14,831,399	)


	For the Three Months Ended August 31, 2024
					Additional								Total
	Common Stock				Paid-In		Treasury			Accumulated			Stockholders'
	Shares		Amount		Capital		Stock			Deficit			Deficit
Balance at May 31, 2024		14,849,246	$	148,492	$	43,896,637	$	(24,839,156	)	$	(29,947,151	)	$	(10,741,178	)
Exercise of stock options		373		4		998								1,002
Compensatory element of stock options						145,941								145,941
Treasury stock								(16,400	)					(16,400	)
Net income											1,051,679			1,051,679
Balance at August 31, 2024		14,849,619	$	148,496	$	44,043,576	$	(24,855,556	)	$	(28,895,472	)	$	(9,558,956	)


	For the Nine Months Ended August 31, 2024
					Additional								Total
	Common Stock				Paid-In		Treasury			Accumulated			Stockholders'
	Shares		Amount		Capital		Stock			Deficit			Deficit
Balance at November 30, 2023		14,849,246	$	148,492	$	43,411,143	$	(23,431,685	)	$	(31,159,182	)	$	(11,031,232	)
Exercise of stock options		373		4		998								1,002
Compensatory element of stock options						631,435								631,435
Treasury stock								(1,423,871	)					(1,423,871	)
Net income											2,263,710			2,263,710
Balance at August 31, 2024		14,849,619	$	148,496	$	44,043,576	$	(24,855,556	)	$	(28,895,472	)	$	(9,558,956	)

The accompanying notes are an integral part of these consolidated financial statements.

CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

August 31, 2025

(Unaudited)

Note 1 - Description of Business, Basis of Presentation and Significant Accounting Policies

Cryo-Cell International, Inc. (“the Company” or “Cryo-Cell”) was incorporated in Delaware on September 11, 1989 and is headquartered in Oldsmar, Florida. The Company is organized in three reportable segments: (1) cellular processing and cryogenic cellular storage, with a current focus on the collection and preservation of umbilical cord blood stem cells for family use (2) the manufacture of PrepaCyte CB units, the processing technology used to process umbilical cord blood stem cells and (3) cryogenic storage of umbilical cord blood stem cells for public use. Revenues for the cellular processing and cryogenic cellular storage represent sales of the umbilical cord blood stem cells program to customers and income from licensees selling the umbilical cord blood stem cells program to customers outside the United States. Revenues for the manufacture of PrepaCyte CB units represent sales of the PrepaCyte CB units to customers. Revenue for the cryogenic storage of umbilical cord blood stem cells for public use, stored at Duke University (see below), is generated from the sale of the cord blood units to the National Marrow Donor Program (“NMDP”), which distributes the cord blood units to transplant centers located in the United States and around the world. The Company's U.S.-based business operations, including the processing and storage of specimens, are handled from its headquarters facility in Oldsmar, Florida. The specimens are primarily stored in commercially available cryogenic storage units at the Company's technologically and operationally advanced facility in Durham, NC.

The unaudited consolidated financial statements including the Consolidated Balance Sheets as of August 31, 2025 and November 30, 2024, the related Consolidated Statements of Income for the three and nine months ended August 31, 2025 and 2024, Cash Flows for the nine months ended August 31, 2025 and August 31, 2024 and Stockholders’ Deficit for the three and nine months ended August 31, 2025 and 2024 have been prepared by Cryo-Cell International, Inc. pursuant to the rules and regulations of the Securities and Exchange Commission for interim financial reporting. Certain financial information and note disclosures, which are normally included in annual financial statements prepared in accordance with accounting principles generally accepted in the United States of America, have been condensed or omitted pursuant to those rules and regulations. It is suggested that these consolidated financial statements be read in conjunction with the financial statements and notes thereto included in the Company's November 30, 2024 Annual Report on Form 10-K. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and changes in cash flows for all periods presented have been made. The results of operations for the three and nine months ended August 31, 2025 and 2024 are not necessarily indicative of the results expected for any interim period in the future or the entire year ending November 30, 2025.

Revenue Recognition

The Company recognizes revenue in accordance with Accounting Standards Codification (“ASC”) Topic 606, Revenue from Contracts with Customers (“ASC 606”). ASC 606 applies to all contracts with customers, except for contracts that are within the scope of other standards, such as leases, insurance, collaboration arrangements and financial instruments. ASC 606 also impacts certain other areas, such as the accounting for costs to obtain or fulfill a contract. ASC 606 also requires disclosure of the nature, amount, timing, and uncertainty of revenue and cash flows arising from contracts with customers.

Under ASC 606, revenue is recognized when, or as, obligations under the terms of a contract are satisfied, which occurs when control of the promised services are transferred to the customers. Revenue is measured as the amount of consideration the Company expects to receive in exchange for transferring services to a customer ("transaction price").

At contract inception, if the contract is determined to be within the scope of ASC 606, the Company evaluates its contracts with customers using the five-step model: (1) identify the contract with the customer; (2) identify the performance obligations in the contract; (3) determine the transaction price; (4) allocate the transaction price to separate performance obligations; and (5) recognize revenue when (or as) each performance obligation is satisfied. The Company evaluates its contracts for legal enforceability at contract inception and subsequently throughout the Company’s relationship with its customers. If legal enforceability with regards to the rights and obligations exist for both the Company and the customer, then the Company has an enforceable contract and revenue recognition is permitted subject to the satisfaction of the other criteria. If, at the outset of an arrangement, the Company determines that a contract with enforceable rights and obligations does not exist, revenues are deferred until all criteria for an enforceable contract are met. The Company only applies the five-step model to contracts when it is probable that collection of the consideration that the Company is entitled to in exchange for the goods or services being transferred to the customer, will occur.

Contract modifications exist when the modification either creates new or changes in the existing enforceable rights and obligations. The Company’s contracts are occasionally modified to account for changes in contract terms and conditions, which the Company refers to as an upgrade or downgrade. An upgrade occurs when a customer wants to pay for additional years of storage. A

downgrade occurs when a customer originally entered into a long-term contract (such as twenty-one year or lifetime plan) but would like to change the term to a one-year contract. Upgrade modifications qualify for treatment as a separate contract as the additional services are distinct and the increase in contract price reflects the Company’s stand-alone selling price for the additional services and will be accounted for on a prospective basis. Downgrade modifications do not qualify for treatment as a separate contract as there is no increase in price over the original contract, thus failing the separate contract criteria. As such, the Company separately considers downgrade modifications to determine if these should be accounted for as a termination of the existing contract and creation of a new contract (prospective method) or as part of the existing contract (cumulative catch-up adjustment). ASC 606 requires that an entity account for the contract modification as if it were a termination of the existing contract, and the creation of a new contract, if the remaining goods or services are distinct from the goods or services transferred on or before the date of the contract modification. As the services after the modification were previously determined to be distinct, the Company concluded that downgrade modifications qualify under this method and will be accounted for on a prospective basis. Although contract modifications do occur, they are infrequent.

Performance Obligations

At contract inception, the Company assesses the goods and services promised in the contracts with customers and identifies a performance obligation for each promise to transfer to the customer a good or service (or bundle of goods or services) that is distinct. The Company then recognizes as revenue the amount of the transaction price that is allocated to the respective performance obligation when (or as) the performance obligation is satisfied. To identify the performance obligations, the Company considers all of the goods or services promised in the contract regardless of whether they are explicitly stated or are implied by customary business practices. The Company determined that the following distinct goods and services represent separate performance obligations involving the sale of its umbilical cord blood product:

•

Collection and processing services

•

Storage services

•

Public cord blood banking

•

License and royalties

•

Sale of PrepaCyte CB product

Collection, Processing and Storage Fees

Processing and storage fees include the Company providing umbilical cord blood and tissue cellular processing and cryogenic cellular storage for private use. Revenues recognized for the cellular processing and cryogenic cellular storage represent sales of the umbilical cord blood stem cells program to customers and income from licensees who are selling the umbilical cord blood stem cells program to customers outside the United States.

The Company recognizes revenue from processing fees at the point in time of the successful completion of processing and recognizes storage fees over time, which is ratably over the contractual storage period as well as other income from royalties paid by licensees related to long-term storage contracts which the Company has under license agreements. Contracted storage periods are annual, twenty-one years and life-time. The life-time storage plan is based on a life expectancy of 81 years, which is the current estimate by the Center for Disease Control for United States women’s life expectancy and concluded that additional data analysis would result in an immaterial difference in revenue. Deferred revenue on the accompanying consolidated balance sheets includes the portion of the annual, the twenty-one-year and the life-time storage fees that are being recognized over the contractual storage period as well as royalties received from foreign licensees relating to long-term storage contracts for which the Company has future obligations under the license agreement. The Company classifies deferred revenue as current if the Company expects to recognize the related revenue over the next 12 months from the balance sheet date.

Significant financing component

When determining the transaction price of a contract, an adjustment is made if payment from a customer occurs either significantly before or significantly after performance, resulting in a significant financing component. For all plans being annual, twenty-one years and lifetime, the storage fee is billed at the beginning of the storage period (prepaid plans). The Company also offers payment plans (including a stated service fee) for customers to pay over time for a period of one to twenty-four plus months. The one-time plan includes the collection kit, processing and testing, return medical courier service and twenty-one years of pre-paid storage fees. The life-time plan includes the collection kit, processing and testing, return medical courier service and pre-paid storage fees for the life of the customer. The Company concluded that a significant financing component is not present within either the prepaid or overtime

payment plans. The Company has determined that the twenty-one year and life-time prepayment options do not include a significant financing component as the payment terms were structured primarily for reasons other than the provision of financing and to maximize profitability.

The Company has determined that the majority of plans that are paid over time are paid in less than a year. When considered over a twenty-four-month payment plan, the difference between the cash selling price and the consideration paid is nominal. As such, the Company believes that its payment plans do not include significant financing components as they are not significant in the aggregate when considered in the context of all contracts entered into nor significant at the individual contract level.

The Company elected to apply the practical expedient where the Company does not need to assess whether a significant financing component exists if the period between when it performs its obligations under the contract and when the customer pays is one year or less.

As of August 31, 2025, the total aggregate transaction price allocated to the unsatisfied performance obligations was recorded as deferred revenue amounting to $59,584,251, which will be recognized ratably on a straight-line basis over the contractual period of which $9,741,319, will be recognized over the next twelve months.

Variable consideration

In December 2005, the Company began providing its customers that enrolled after December 2005 a payment warranty under which the Company agrees to pay $50,000 to its client if the umbilical cord blood product retrieved is used for a stem cell transplant for the donor or an immediate family member and fails to engraft, subject to various restrictions. Effective February 1, 2012, the Company increased the $50,000 payment warranty to a $75,000 payment warranty to all of its new clients. Effective June 1, 2017, the Company increased the payment warranty to $100,000 to all new clients who choose the premium processing method, PrepaCyte CB. The product warranty is available to clients who enroll under this structure for as long as the specimen is stored with the Company. In the processing and storage agreements, the Company provides limited rights which are offered to customers automatically upon contract execution. The Company has determined that the payment warranty represents variable consideration payable to the customer.

Based on the Company’s historical experience to date, the Company has determined the payment warranty to be fully constrained under the most likely amount method. Consequently, the transaction price does not currently reflect any expectation of service level credits. At the end of each reporting period, the Company will update the estimated transaction price related to the payment warranty including updating its assessment of whether an estimate of variable consideration is constrained to represent faithfully the circumstances present at the end of the reporting period and the changes in circumstances during the reporting period.

Allocation of transaction price

As the Company’s processing and storage agreements contain multiple performance obligations, ASC 606 requires an allocation of the transaction price based on the estimated relative standalone selling prices of the promised services underlying each performance obligation. The Company has selected an adjusted market assessment approach to estimate the stand-alone selling prices of the processing services and storage services and concluded that the published list price is the price that a customer in that market would be willing to pay for those goods or services. The Company also considered the fact that all customers are charged the list prices current at the time of their enrollment where the Company has separately stated list prices for processing and storage.

Costs to Obtain a Contract

The Company capitalizes commissions that are incremental in obtaining customer contracts and the costs incurred to fulfill a customer contract if those costs are not within the scope of another topic within the accounting literature and meet the specified criteria. These costs are deferred in other current or long-term assets and are expensed to selling, general and administrative expenses as the Company satisfies the performance obligations by transferring the service to the customer. These assets will be periodically assessed for impairment. As a practical expedient, the Company elected to recognize the incremental costs of obtaining its annual contracts as an expense when incurred, as the amortization period of the asset recognized would have been one year.

The Company has determined that payments under the Company’s refer-a-friend program (“RAF program”) are incremental costs of obtaining a contract as they provide an incentive for existing customers to refer new customers to the Company and is referred to as commission. The amount paid under the RAF program (either through issuance of credits to customers or check payments) which exceeds the typical commission payment to a sales representative is recorded as a reduction to revenue under ASC 606. During the three and nine months ended August 31, 2025, the Company recorded $8,867 and $27,350, respectively, in commission payments to customers under the RAF program as a reduction to revenue. During the three and nine months ended August 31, 2024, the Company recorded $9,813 and $35,306, respectively, in commission payments to customers under the RAF program as a reduction to revenue. For the three and nine months ended August 31, 2025 the Company capitalized additional contract acquisition costs of $27,702 and $88,543,

respectively, net of amortization. For the three and nine months ended August 31, 2024, the Company capitalized additional contract acquisition costs of $28,876 and $90,545, respectively, net of amortization expense.

Public banking revenue

The Company sells and provides units not likely to be of therapeutic use for research to qualified organizations and companies operating under Institutional Review Board approval. Control is transferred at the point in time when the shipment has occurred, at which time, the Company records revenue.

Licensee and royalty income

Licensee and royalty income consist of royalty income earned on the processing and storage of cord blood stem cell specimens by an affiliate where the Company has a License and Royalty Agreement. The Company records revenue from processing and storage of specimens and pursuant to agreements with licensees. The Company records the royalty revenue in same period that the related processing and storage is being completed by the affiliate.

Product Revenue

The Company records revenue from the sale of the PrepaCyte CB product line upon shipment of the product to the Company’s customers.

Shipping and handling

The Company elected to apply the practical expedient to account for shipping and handling activities performed after the control of a good has been transferred to the customer as a fulfillment cost. Shipping and handling costs that the Company incurs are therefore expensed and included in cost of sales.

Disaggregation of Revenue

The revenue as reflected in the statements of income is disaggregated by products and services.

The following table provides information about assets and liabilities from contracts with customers:


	August 31, 2025		November 30, 2024
Contract assets (sales commissions)	$	831,458	$	775,147
Accounts receivable	$	6,833,380	$	7,309,094
Short-term contract liabilities (deferred revenue)	$	9,741,319	$	9,788,574
Long-term contract liabilities (deferred revenue)	$	49,842,932	$	46,556,990

The Company, in general, requires the customer to pay for processing and storage services at the time of processing. Contract assets include deferred contract acquisition costs, which will be amortized along with the associated revenue. Contract liabilities include payments received in advance of performance under the contract and are realized with the associated revenue recognized under the contract. Accounts receivable consists of amounts due from clients that have enrolled and processed in the umbilical cord blood stem cell processing and storage programs related to renewals of annual plans and amounts due from license affiliates, and sublicensee territories. The Company did not have asset impairment charges related to contract assets in the three and nine months ended August 31, 2025.

The following table presents changes in the Company’s contract assets and liabilities during the nine months ended August 31, 2025:


	Balance at December 1, 2024		Additions		Deductions			Balance at August 31, 2025
Contract assets (sales commissions)	$	775,147	$	88,543	$	(32,232	)	$	831,458
Accounts receivable	$	7,309,094	$	30,869,785	$	(31,345,499	)	$	6,833,380
Contract liabilities (deferred revenue)	$	56,345,564	$	19,375,191	$	(16,136,504	)	$	59,584,251

The following table presents changes in the Company’s contract assets and liabilities during the nine months ended August 31, 2024:


	Balance at December 1, 2023		Additions		Deductions			Balance at Augist 31, 2024
Contract assets (sales commissions)	$	695,695	$	90,545	$	(28,682	)	$	757,558
Accounts receivable	$	6,576,240	$	31,775,756	$	(31,478,355	)	$	6,873,641
Contract liabilities (deferred revenue)	$	50,891,353	$	16,303,050	$	(12,169,354	)	$	55,025,049

Accounts Receivable

Accounts receivable consist of uncollateralized amounts due from clients that have enrolled and processed in the umbilical cord blood stem cell processing and storage programs and amounts due from license affiliates, and sublicensee territories. Accounts receivable are due within 30 days and are stated at amounts net of an allowance for doubtful accounts. Accounts outstanding longer than the contractual payment terms are considered past due. The Company determines its allowance by considering the length of time accounts receivable are past due, the Company’s previous loss history, and the client’s current ability to pay its obligations. Therefore, if the financial condition of the Company’s clients were to deteriorate beyond the estimates, the Company may have to increase the allowance for doubtful accounts which could have a negative impact on earnings. The Company writes-off accounts receivable when they become uncollectible, and payments subsequently received on such receivables are credited to the allowance for doubtful accounts.

Inventories

As part of the Cord:Use Purchase Agreement, the Company has an agreement with Duke University (“Duke”) to receive, process, and store cord blood units for the Public Cord Blood Bank (“Duke Services”). As of August 31, 2025, the Company had approximately 6,000 cord blood units in inventory. These units are valued at the lower of cost or net realizable value. Costs include the cost of collecting, transporting, processing and storing the unit. Costs charged by Duke for their Duke Services are based on a monthly fixed fee for processing and storing 36 blood units per year. The Company computes the cost per unit for these Duke Services and capitalizes the unit cost on all blood units shipped and stored in a year at Duke. If the Company ships and stores less than 36 blood units with Duke in a one-year period, a portion of these fixed costs are expensed and included in facility operating costs. Certain costs of collection incurred, such as the cost of collection staff and transportation costs incurred to ship Public Bank units from hospitals to the stem cell laboratory are allocated to banked units based on an average cost method. The change in the number of expected units to be sold could have a significant impact on the estimated net realizable value of banked units which could have a material effect on the value of the inventory. Costs incurred related to cord blood units that cannot be sold are expensed in the period incurred and are included in facility operating costs in the accompanying statements of operations. The Company records a reserve against inventory for units which have been processed and frozen but may not ultimately become distributable (see Note 3).

Income Taxes

Deferred income tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred income tax assets and liabilities are measured using enacted tax rates expected to be recovered or settled. The Company records a valuation allowance when it is “more likely than not” that all of the future income tax benefits will not be realized. When the Company changes its determination as to the amount of deferred income tax assets that can be realized, the valuation allowance is adjusted with a corresponding impact to income tax expense in the period in which such determination is made. The ultimate realization of the Company’s deferred income tax assets depends upon generating sufficient taxable income prior to the expiration of the tax attributes. In assessing the need for a valuation allowance, the Company projects future levels of taxable income. This assessment requires significant judgment. The Company examines the evidence related to the recent history of losses, the economic conditions in which the Company operates and forecasts and projections to make that determination.

The Company recognizes the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the more-likely-than-not threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority. Increases or decreases to the unrecognized tax benefits could result from management’s belief that a position can or cannot be sustained upon examination based on subsequent information or potential lapse of the applicable statute of limitation for certain tax positions.

The Company recognizes interest and penalties related to uncertain tax positions in income tax expense. For the nine months ended August 31, 2025 and August 31, 2024, the Company had no provisions for interest or penalties related to uncertain tax positions.

Long-Lived Assets

The Company evaluates the realizability of its long-lived assets, which requires impairment losses to be recorded on long-lived assets used in operations when indicators of impairment, such as reductions in demand or when significant economic slowdowns are present. Reviews are performed to determine whether the carrying value of an asset is impaired, based on comparisons to undiscounted expected future cash flows. If this comparison indicates that there is impairment and carrying value is in excess of fair value, the impaired asset is written down to fair value, which is typically calculated using: (i) quoted market prices or (ii) discounted expected future cash flows utilizing a discount rate. The Company did not note any impairment for the three and nine months ended August 31, 2025 and 2024.

Goodwill

Goodwill represents the excess of the purchase price of the assets acquired from Cord:Use over the estimated fair value of the net tangible, intangible and identifiable assets acquired. The annual assessment of the reporting unit is performed as of September 1st, and an assessment is performed at other times if an event occurs or circumstances change that would more likely than not reduce the fair value of the asset below its carrying value. The Company first performs a qualitative assessment to test goodwill for impairment and concludes if it is more likely than not that the fair value of the reporting unit is less than its carrying value. If the qualitative assessment concludes that it is not more likely than not that the fair value is less than the carrying value, the two-step goodwill impairment test is not required. If the qualitative assessment concludes that it is more likely than not that the fair value of the reporting unit is less than the carrying value, then the two-step goodwill impairment test is required. Step one of the impairment assessment compares the fair value of the reporting unit to its carrying value and if the fair value exceeds its carrying value, goodwill is not impaired. If the carrying value exceeds the fair value, the implied fair value of goodwill is compared to the carrying value of goodwill. If the implied fair value exceeds the carrying value then goodwill is not impaired; otherwise, an impairment loss would be recorded by the amount the carrying value exceeds the implied fair value.

Leases

At the inception of a lease arrangement, the Company determines whether the arrangement is or contains a lease based on the unique facts and circumstances present in the arrangement. Leases with a term greater than one year are recognized on the balance sheet as a right-of-use (ROU) assets and as short-term and long-term lease liabilities, as applicable. The Company does not have any financing leases.

Operating lease liabilities and their corresponding right-of-use assets are initially recorded based on the present value of lease payments over the expected remaining lease term. The interest rate implicit in lease contracts is typically not readily determinable. As a result, the Company utilizes its incremental borrowing rate to discount lease payments, which reflects the fixed rate at which the Company believes it could borrow on a collateralized basis the amount of the lease payments in the same currency, for a similar term, in a similar economic environment.

The Company has elected not to recognize leases with an original term of one year or less on the balance sheet. The Company typically only includes an initial lease term in its assessment of a lease arrangement. Options to renew a lease are not included in the Company’s assessment unless there is reasonable certainty that the Company will renew.

Stock Compensation

As of August 31, 2025, the Company has three stock-based compensation plans, which are described in Note 7 to the unaudited consolidated financial statements: the 2006 Plan, 2012 Plan and the 2022 Plan. The 2006 and 2012 Plans will remain in effect as long as any awards under it are outstanding; however, no further awards may be granted under either plan. The 2022 Plan became effective April 8, 2022 as approved by the Board of Directors and approved by the stockholders at the 2022 Annual Meeting. The Company recognized $374,198 and $631,435 for the nine months ended August 31, 2025 and August 31, 2024 respectively, of stock compensation expense. The Company recognized $36,780 and $145,941 for the three months ended August 31, 2025 and August 31, 2024, respectively, of stock option compensation expense.

The Company recognizes stock-based compensation based on the fair value of the related awards. Under the fair value recognition guidance of stock-based compensation accounting rules, stock-based compensation expense is estimated at the grant date based on the fair value of the award and is recognized as expense over the requisite service period of the award. The fair value of service-based vesting condition and performance-based vesting condition stock option awards is determined using the Black-Scholes valuation model. For stock option awards with only service-based vesting conditions and graded vesting features, the Company recognizes stock compensation expense based on the graded-vesting method. To value awards with market-based vesting conditions

the Company uses a binomial valuation model. The Company recognizes compensation cost for awards with market-based vesting conditions on a graded-vesting basis over the derived service period calculated by the binomial valuation model. The use of these valuation models involves assumptions that are judgmental and highly sensitive in the determination of compensation expense and include the expected life of the option, stock price volatility, risk-free interest rate, dividend yield, exercise price, and forfeiture rate. Forfeitures are estimated at the time of valuation and reduce expense ratably over the vesting period.

The estimation of stock awards that will ultimately vest requires judgment and to the extent that actual results or updated estimates differ from current estimates, such amounts will be recorded as a cumulative adjustment in the period they become known. The Company considered many factors when estimating forfeitures, including the recipient groups and historical experience. Actual results and future changes in estimates may differ substantially from current estimates.

The Company issues performance-based equity awards which vest upon the achievement of certain financial performance goals, including revenue and income targets. Determining the appropriate amount to expense based on the anticipated achievement of the stated goals requires judgment, including forecasting future financial results. The estimate of the timing of the expense recognition is revised periodically based on the probability of achieving the required performance targets and adjustments are made as appropriate. The cumulative impact of any revision is reflected in the period of the change. If the financial performance goals are not met, the award does not vest, so no compensation cost is recognized and any previously stock-recognized stock-based compensation expense is reversed.

The Company issues equity awards with market-based vesting conditions which vest upon the achievement of certain stock price targets. If the awards are forfeited prior to the completion of the derived service period, any recognized compensation is reversed. If the awards are forfeited after the completion of the derived service period, the compensation cost is not reversed, even if the awards never vest.

Fair Value of Financial Instruments

Management uses a fair value hierarchy, which gives the highest priority to quoted prices in active markets. The fair value of financial instruments is estimated based on market trading information, where available. Absent published market values for an instrument or other assets, management uses observable market data to arrive at its estimates of fair value. Management believes that the carrying amount of cash and cash equivalents, accounts receivable, accounts payable and accrued expenses approximate fair value due to the short-term nature of these instruments. The Company believes that the fair value of its Revenue Sharing Agreements (“RSAs”) liability recorded on the balance sheet is between the recorded book value and up to the Company’s previous settlement experience, due to the various terms and conditions associated with each RSA.

The Company uses an accounting standard that defines fair value as an exit price, representing the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. As such, fair value is a market-based measurement that should be determined based on assumptions that market participants would use in pricing an asset or liability. As a basis for considering such assumptions, the standard establishes a three-level fair value hierarchy that prioritizes the inputs used to measure fair value. The three levels of inputs used to measure fair value are as follows:

Level 1 Quoted prices in active markets for identical assets or liabilities.

Level 2 Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data.

Level 3 Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

The following table summarizes the financial assets and liabilities measured at fair value on a recurring basis as of August 31, 2025 and November 30, 2024, respectively, segregated among the appropriate levels within the fair value hierarchy:


	Fair Value at		Fair Value Measurements at August 31, 2025 Using
Description	August 31, 2025		Level 1		Level 2		Level 3
Assets:
Marketable securities	$	2,956,238	$	2,956,238	$	—	$	—
Total	$	2,956,238	$	2,956,238	$	—	$	—


	Fair Value at		Fair Value Measurements at November 30, 2024 Using
Description	November 30, 2024		Level 1		Level 2		Level 3
Assets:
Marketable securities	$	2,935,183	$	2,935,183	$	—	$	—
Total	$	2,935,183	$	2,935,183	$	—	$	—

The following is a description of the valuation techniques used for these items, as well as the general classification of such items pursuant to the fair value hierarchy:

Marketable securities - Equity securities with readily determinable fair values are measured at fair value with the changes in fair value recognized through net income. There was ($193,886) and ($604,619) in unrealized holding losses, respectively, recorded in other income and expense on the accompanying consolidated statements of income for the three and nine months ended August 31, 2025, respectively. There was $522,458 and $1,056,052 in unrealized holding gain, respectively, recorded in other income and expense on the accompanying consolidated statements of income for the three and nine months ended August 31, 2024, respectively.

Interest rate swap - The fair value is based on prevailing market data and derived from proprietary models based on well recognized financial principles and reasonable estimates about relevant future market conditions. As of the three and nine months ended August 31, 2025 there was a $0 and $0 gain on a derivative recorded on the accompanying consolidated statements of income. As of the three and nine months ended August 31, 2024, there was a $0 and $105,887 gain on a derivative recorded on the accompanying consolidated statements of income. On April 15, 2024, the Company terminated the interest rate swap agreement and recorded proceeds of $228,000.

Product Warranty and Cryo-Cell CaresTM Program

In December 2005, the Company began providing its customers that enrolled after December 2005 a payment warranty under which the Company agrees to pay $50,000 to its client if the umbilical cord blood product retrieved is used for a stem cell transplant for the donor or an immediate family member and fails to engraft, subject to various restrictions. Effective February 1, 2012, the Company increased the $50,000 payment warranty to a $75,000 payment warranty to all of its new clients. Effective June 1, 2017, the Company increased the payment warranty to $100,000 to all new clients who choose the premium processing method, PrepaCyte CB. The product warranty is available to clients who enroll under this structure for as long as the specimen is stored with the Company. The Company has not experienced any claims under the warranty program nor has it incurred costs related to these warranties.

As discussed above, the Company has determined that the payment warranty represents variable consideration payable to the customer. In accordance with ASC 606, the Company has concluded the payment warranty be fully constrained under the most likely amount method; therefore, the transaction price does not reflect any expectation of service level credits at August 31, 2025 and November 30, 2024. At the end of each reporting period, the Company shall update the estimated transaction price related to the payment guarantee including updating its assessment of whether an estimate of variable consideration is constrained to represent faithfully the circumstances present at the end of the reporting period and the changes in circumstances during the reporting period.

Recently Issued Accounting Pronouncements

In July 2023, the FASB issued ASU 2023-07, Enhanced Segment Reporting. This update amends the segment reporting requirements under Accounting Standards Codification (ASC) 280, "Segment Reporting." The guidance mandates more detailed disclosures regarding segment expenses, including labor costs and other significant operating expenses. The Company is currently evaluating the impact of ASU 2023-07 on its financial statements and segment disclosures. The guidance is effective for fiscal years beginning after December 15, 2023, and interim periods within fiscal years beginning after December 15, 2024.

In September 2023, the FASB issued ASU 2023-09, Improvements to Income Tax Disclosures. This ASU enhances and improves the income tax disclosure requirements under Topic 740, "Income Taxes." The key provisions of this update include additional disclosures related to income tax expense, unrecognized tax benefits, and the impact of tax rate changes on the financial statements. The Company is currently assessing the impact of ASU 2023-09 on its financial statement disclosures. The guidance is effective for fiscal years beginning after December 15, 2024. While the Company has not yet determined the full effect on its financial reporting, it is in the process of evaluating how to implement the required enhanced disclosures. This includes more detailed information on tax rate reconciliation, tax liabilities, and changes in unrecognized tax benefits.

Note 2 – Segment Reporting

The Company is organized in three reportable segments:

The cellular processing and cryogenic storage of umbilical cord blood and cord tissue stem cells for family use. Revenue is generated from the initial processing and testing fees and the annual storage fees charged each year for storage (the “Umbilical cord blood and cord tissue stem cell service”).

The manufacture of PrepaCyte® CB units, the processing technology used to process umbilical cord blood stem cells. Revenue is generated from the sales of the PrepaCyte® CB units (the “PrepaCyte®-CB”).

The cellular processing and cryogenic storage of umbilical cord blood stem cells for public use. Revenue is generated from the sale of the cord blood units to the National Marrow Donor Program (“NMDP”), which distributes the cord blood units to transplant centers located in the United States, and around the world.

The following table shows, by segment: net revenue, cost of sales, depreciation and amortization, operating profit, and interest expense for the three and nine months ended August 31, 2025 and 2024:


	For the three months ended August 31,
	2025			2024
Net revenue:
Umbilical cord blood and cord tissue stem cell service	$	7,820,877		$	7,945,470
PrepaCyte CB		436			636
Public cord blood banking		4,119			120,609
Total net revenue	$	7,825,432		$	8,066,715
Cost of sales:
Umbilical cord blood and cord tissue stem cell service	$	1,666,952		$	1,859,090
PrepaCyte CB		2,295			1,220
Public cord blood banking		132,172			265,536
Total cost of sales	$	1,801,419		$	2,125,846
Operating profit:
Umbilical cord blood and cord tissue stem cell service	$	2,032,929		$	1,542,346
PrepaCyte CB		(4,340	)		(7,529	)
Public cord blood banking		(128,053	)		(144,927	)
Total operating profit	$	1,900,536		$	1,389,890
Depreciation and amortization:
Umbilical cord blood and cord tissue stem cell service	$	183,212		$	187,614
PrepaCyte CB		2,481			6,945
Public cord blood banking		—			—
Total depreciation and amortization	$	185,693		$	194,559
Interest expense:
Umbilical cord blood and cord tissue stem cell service	$	538,219		$	533,464
PrepaCyte CB		—			—
Public cord blood banking		—			—
Total interest expense	$	538,219		$	533,464

	For the nine months ended August 31,
	2025			2024
Net revenue:
Umbilical cord blood and cord tissue stem cell service	$	23,558,484		$	23,716,492
PrepaCyte CB		35,785			39,470
Public cord blood banking		128,886			205,799
Total net revenue	$	23,723,155		$	23,961,761
Cost of sales:
Umbilical cord blood and cord tissue stem cell service	$	5,020,695		$	5,574,109
PrepaCyte CB		13,537			37,083
Public cord blood banking		608,314			699,872
Total cost of sales	$	5,642,546		$	6,311,064
Operating profit:
Umbilical cord blood and cord tissue stem cell service	$	4,922,731		$	4,115,571
PrepaCyte CB		5,878			(18,447	)
Public cord blood banking		(479,428	)		(494,493	)
Total operating profit	$	4,449,181		$	3,602,631
Depreciation and amortization:
Umbilical cord blood and cord tissue stem cell service	$	551,278		$	266,289
PrepaCyte CB		16,370			20,834
Public cord blood banking		—			420
Total depreciation and amortization	$	567,648		$	287,543
Interest expense:
Umbilical cord blood and cord tissue stem cell service	$	1,584,307		$	1,119,196
PrepaCyte CB		—			—
Public cord blood banking		—			—
Total interest expense	$	1,584,307		$	1,119,196

The following table shows the assets by segment as of August 31, 2025 and November 30, 2024:


	As of		As of
	August 31, 2025		November 30, 2024
Assets:
Umbilical cord blood and cord tissue stem cell service	$	57,911,818	$	59,259,451
PrepaCyte CB		92,684		138,169
Public cord blood banking		5,164,627		5,280,013
Total assets	$	63,169,129	$	64,677,633

Note 3 – Inventory

Inventory is comprised of public cord blood banking specimens, collection kits, finished goods, work-in-process and raw materials. Collection kits are used in the collection and processing of umbilical cord blood and cord tissue stem cells, finished goods include products purchased or assumed for resale and for the use in the Company’s processing and storage service. Inventory in the Public Cord Blood Bank includes finished goods that are specimens that are available for resale. The Company considers Public Cord Blood Inventory in the Public Cord Blood Bank that has not completed all testing to determine viability to be work in process.

The components of inventory at August 31, 2025 and November 30, 2024 are as follows:


	As of August 31, 2025			As of November 30, 2024
Raw materials	$	—		$	—
Work-in-process		269,907			207,291
Work-in-process – Public Bank		—			—
Finished goods		68,367			71,566
Finished goods – Public Bank		5,163,220			5,279,866
Collection kits		26,312			48,813
Inventory reserve		(7,718	)		(7,718	)
Total inventory	$	5,520,088		$	5,599,818

Note 4 – Intangible Assets

The Company incurs certain legal and related costs in connection with patent and trademark applications. If a future economic benefit is anticipated from the resulting patent or trademark or an alternate future use is available to the Company, such costs are capitalized and amortized over the expected life of the patent or trademark. The Company’s assessment of future economic benefit involves considerable management judgment. A different conclusion could result in the reduction of the carrying value of these assets.

Intangible assets were as follows as of August 31, 2025 and November 30, 2024:


	Useful lives	August 31, 2025			November 30, 2024
Patents	10-20 years	$	697,744		$	697,744
Less: Intangible asset impairment			(377,810	)		(377,810	)
Less: Accumulated amortization			(180,776	)		(172,058	)
License agreement	10 years		474,000			474,000
Less: Intangible asset impairment			(185,000	)		(185,000	)
Less: Accumulated amortization			(285,767	)		(272,055	)
Customer relationships – PrepaCyte®CB	15 years		41,000			41,000
Less: Intangible asset impairment			(26,267	)		(26,267	)
Less: Accumulated amortization			(10,895	)		(10,300	)
Brand	1 year		31,000			31,000
Less: Accumulated amortization			(31,000	)		(31,000	)
Customer relationships – Cord:Use	30 years		960,000			960,000
Less: Accumulated amortization			(232,000	)		(208,000	)
Net Intangible Assets		$	874,229		$	921,254

Amortization expense of intangibles was approximately $13,000 and $17,000 for the three months ended August 31, 2025 and August 31, 2024, respectively. Amortization expense of intangibles was approximately $47,000 and $51,000 for the nine months ended August 31, 2025 and August 31, 2024.

Note 5 – Notes Payable

On July 18, 2022, the Company entered into a Credit Agreement (“Agreement Susser”) with Susser Bank, a Texas state bank, as administrative agent (“Susser”) on behalf of itself and the other lenders (collectively, the “Lenders”) for (i) an unsecured revolving line of credit in an aggregate principal amount of up to $10,000,000 (the “RCF”); and (ii) a term loan facility in an original principal amount of $8,960,000 (the “Term Loan Susser” and together with the RCF collectively, the “Loans”). In connection with the RCF the Company entered into a Revolving Credit Line, in favor of Susser, in the stated principal amount of $10,000,000 (the “RCF Note”), and in connection with the Term Loan the Company entered into a Term Note, in favor of Susser, in the stated principal amount of $8,960,000 (the “Term Note” and together with RCF Note, collectively, the “Notes”). The Loans bear interest at the Company’s option at: (a) the Base Rate, which is the highest of (i) the rate of interest published by The Wall Street Journal, from time to time, as the “U.S. Prime Rate”, (ii) the federal funds rate plus 0.5% and (iii) the Monthly SOFR rate plus 1.0% (subject in each case to a floor of 5.5%), plus 4.25% or (b) the Monthly SOFR plus 3.25% (subject to a floor of 4.5%). The RCF matures on July 18, 2025 and the Term Note matures on July 18, 2032. On July 15, 2025, Susser extended the maturity date of the RCF to October 16, 2025. As of the three months ended August 31, 2025 and August 31, 2024, the Company paid interest of $244,006 and $254,758, respectively, which is reflected in interest expense on the accompanying consolidated statements of income. As of the nine months ended August 31, 2025 and August 31, 2024 the Company paid interest of $706,161 and $700,560, respectively, which is reflected in interest expense on the accompanying consolidated statements of income. The interest rates for the RCF and Term Note as of August 31, 2025 were 7.50% and 7.60%, respectively.

The average outstanding balance during the nine months ended August 31, 2025 for the revolving line of credit was $3,701,825. The average outstanding balance during the twelve months ended November 30, 2024 for the revolving line of credit was $2,496,171. The revolving line of credit balance as of August 31, 2025 and November 30, 2024 was $3,200,000 and $3,520,000, respectively, and is reflected on the accompanying balance sheet.

The Company incurred debt issuance costs related to the term loan in the amount of $196,501 which is recorded as a direct reduction of the carrying amount of the note payable and amortized over the life of the loan. As of the three months ended August 31, 2025 and August 31, 2024, $5,192 and $5,297, respectively, of the debt issuance costs were amortized and are reflected in interest expense on the accompanying consolidated statements of income. As of the nine months ended August 31, 2025 and August 31, 2024, $15,657 and $15,968, respectively, of the debt issuance costs were amortized and are reflected in interest expense on the accompanying consolidated statements of income.

On March 27, 2023, the Company entered into an interest rate swap agreement with Susser to manage exposure to interest rate risk related to its variable rate debt obligation under the Term Note. The swap agreement had a notional amount equal to the Term Loan. The agreement is to pay the Company monthly SOFR plus 3.25% on the notional amount and the Company is to pay a fixed rate of interest equal to 6.96%. The effective date of the amended term loan was March 27, 2023 with a maturity date of July 29, 2032. On April 15, 2024, the Company terminated the interest rate swap agreement and recorded proceeds of $228,000.

The Company is required to pay a commitment fee equal to 0.5% times the daily average unused portion of the RCF.

The Agreement requires the Company to maintain a Leverage Ratio, determined as of the last day of each quarter for the four-fiscal quarter period ending on the date of determination, of no more than 3.50 to 1.00. The Agreement also requires the Company to maintain a Debt Service Coverage Ratio of no less than 1.25 to 1.00 determined as of the last day of each quarter for the four-fiscal quarter period ending on the date of determination.

As of August 31, 2025 and November 30, 2024, the note payable obligation was as follows:


	August 31, 2025			November 30, 2024
Note payable - Susser	$	8,518,465		$	8,628,700
Unamortized debt issuance costs - Susser		(132,510	)		(148,167	)
Net note payable	$	8,385,955		$	8,480,533
Current portion of note payable	$	179,187		$	170,488
Long-term note payable, net of debt issuance costs		8,206,768			8,310,045
Total	$	8,385,955		$	8,480,533

Interest expense on the note payable for the three and nine months ended August 31, 2025 and 2024 was as follows:


		For the three months ended				For the nine months ended

38

Item 1. Legal Proceedings

Revenue Recognition

CRYO CELL INTERNATIONAL INC 10-Q