U. S. Securities and Exchange Commission
Washington D.C. 20549
FORM 10-QSB
(Mark One)
/ X / Quarterly report pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934.
For the quarterly period ended February 28, 2001
/ / 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 0-23386
CRYO-CELL INTERNATIONAL, INC.
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(Exact name of Small Business Issuer as Specified in its Charter)
DELAWARE 22-3023093
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(State or other Jurisdiction (I.R.S. Employer
of Incorporation or Identification No.)
Organization)
3165 McMullen Booth Road, Building B, Clearwater, Florida 33761
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(Address of Principal Executive Offices) (Zip Code)
Issuer's phone number, including area code: (727) 723-0333
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(Former name, former address and former fiscal year, if changed since last
report).
Check whether the issuer (1) has filed all reports required to be filed by
section 13 or 15 (d) of the Exchange Act during the preceding 12 months (or for
such shorter period that the Registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
Yes / X / No / /
State the number of shares outstanding of each of the Registrant's classes of
common stock, as of the latest practicable date. As of February 28, 2001,
10,175,629 shares of $0.01 par value common stock were outstanding.
Transitional Small Business Disclosure Format (check one). Yes / / No / X /
CRYO-CELL INTERNATIONAL, INC.
TABLE OF CONTENTS
PAGE
PART I - FINANCIAL INFORMATION (UNAUDITED)
Item 1. Financial Statements
Condensed Consolidated Balance Sheets 3
Condensed Consolidated Statements of Operations 4
Condensed Consolidated Statements of Cash Flows 5
Notes to Condensed Consolidated Financial Statements 6
Item 2. Management's Discussion and Analysis 12
PART II - OTHER INFORMATION
Item 1. Legal Proceedings 18
Item 6. Exhibits and Reports On Form 8-K 20
SIGNATURES 21
2
CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES
----------------------------------------------
CONSOLIDATED BALANCE SHEETS
ASSETS
------
February 28, November 30,
2001 2000
----------- -----------
Current Assets
- --------------
Cash and cash equivalents $ 2,560,901 $ 2,695,794
Accounts receivable and advances (net of allowance for
doubtful accounts of $29,000) 175,475 131,573
Receivable - Litigation 69,178 69,178
Receivable - Revenue Sharing Agreement 380,000 380,000
Marketable securities 288,181 429,428
Prepaid expenses and other current assets 258,730 174,817
----------- -----------
Total current assets 3,732,465 3,880,790
----------- -----------
Property and Equipment 3,009,738 3,018,708
- ---------------------- ----------- -----------
Other Assets
- ------------
Intangible assets (net of amortization of $59,196 and $57,018, respectively) 107,537 108,675
Marketable securities - -
Investment in European Affiliate 1,000,000 1,000,000
Investment option to purchase 100,000 100,000
Loan receivable - affiliate 150,000 100,000
Deposits with vendors and others 128,495 29,195
----------- -----------
Total other assets 1,486,032 1,337,870
----------- -----------
$ 8,228,235 $ 8,237,368
=========== ===========
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
February 28, November 30,
2001 2000
----------- -----------
Current Liabilities
- -------------------
Accounts payable $ 253,498 $ 92,911
Accrued expenses and withholdings 196,975 182,782
Current portion of obligations under capital leases 2,738 3,122
----------- -----------
Total current liabilities 453,211 278,815
----------- -----------
Other Liabilities
- -----------------
Unearned revenue 1,185,128 1,279,683
Deposits 16,175 28,725
Obligations under capital leases-net of current portion 12,868 14,530
----------- -----------
Total other liabilities 1,214,171 1,322,938
----------- -----------
Stockholders' Equity
- --------------------
Preferred stock (500,000 $.01 par value authorized and unissued) - -
Common stock (20,000,000 $.01 par value common shares
authorized; 10,175,629 at February 28, 2001, and 10,135,629
at November 30, 2000 issued and outstanding) 101,756 101,327
Additional paid-in capital 15,394,785 15,214,215
Additional paid-in capital - stock options 157,280 124,010
Accumulated other comprehensive income (loss) 25,681 26,928
Accumulated deficit (9,118,649) (8,830,865)
----------- -----------
Total stockholders' equity 6,560,853 6,635,615
----------- -----------
$ 8,228,235 $ 8,237,368
=========== ===========
The accompanying notes to consolidated financial statements are an integral part
of these statements.
3
CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES
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CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
Three Months Ended
------------------
February 28, February 29,
2001 2000
------------ ------------
Revenue $ 761,618 $ 425,903
------------ ------------
Costs and Expenses:
Cost of sales 264,448 163,607
Marketing, general & administrative expenses 808,948 576,636
Research, development and related engineering 17,591 21,191
Depreciation and amortization 68,555 31,309
------------ ------------
Total cost and expenses 1,159,542 792,743
------------ ------------
Operating Loss (397,924) (366,840)
------------ ------------
Other Income and (Expense):
Interest Income 36,142 15,358
Interest Expense (528) (874)
Other Income 175,000 -
Loss on Sale of Marketable Securities (100,474) -
------------ ------------
Total other income 110,140 14,484
------------ ------------
Net Loss $ (287,784) $ (352,356)
============ ============
Net loss per share - basic and diluted ($0.03) ($0.04)
============ ============
Number of Shares Used In Computation
Basic and diluted 10,142,485 9,294,435
============ ============
Comprehensive loss:
Net loss: (287,784) (352,356)
Other comprehensive income (loss)
Net increase (decrease) in value
of marketable securities (1,247) 377,639
------------ ------------
Comprehensive income (loss) (289,031) 25,283
============ ============
Comprehensive loss per share - basic and diluted (0.03) -
============ ============
The accompanying notes to consolidated financial statements are an integral
part of these statements.
4
CRYO-CELL INTERNATIONAL, INC. AND SUBSIDIARIES
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CONSOLIDATED STATEMENT OF CASH FLOWS
Three Months Ended
------------------
February 28, February 29,
2001 2000
---- ----
Cash Flows from Operating Activities
Net Loss $ (287,784) $ (352,356)
Adjustments to reconcile net loss
to cash used for operating activities:
Depreciation and amortization 76,562 31,309
Loss on sale of marketable securities 100,474 -
Issuance of common stock for interest and services rendered 173,363 34,132
Changes in assets and liabilities:
Accounts receivable (43,902) (27,921)
Prepaid expenses and other current assets (83,912) (31,707)
Deposits (99,300) (4,862)
Accounts payable 160,587 12,533
Accrued expenses 14,193 21,375
Refundable income taxes payable - (706)
Unearned revenue and deposits (107,105) 48,329
------------ ------------
Net cash provided by (used for) operating activities (96,924) (269,874)
------------ ------------
Cash flows from investing activities:
Loan receivable - Saneron (50,000) -
Purchases of property and equipment (65,414) (192,809)
Payments for intangible assets (1,040) (15,208)
------------ ------------
Net cash provided by (used for) investing activities (116,454) (208,017)
------------ ------------
Cash flows from financing activities
Proceeds from the sale of securities 39,531 21,000
Exercise of stock options 41,000 433,580
Repayment of capital leases (2,046) (1,702)
------------ ------------
Net cash provided by financing activities: 78,485 452,878
------------ ------------
Increase (decrease) in cash and cash equivalents (134,893) (25,013)
Beginning of period 2,695,794 1,555,190
------------ ------------
End of period $2,560,901 $1,530,177
============ ============
Supplemental disclosure of cash flow information:
Interest $ 528 $ 874
============ ============
Income taxes $ - $ -
============ ============
The accompanying notes to consolidated financial statements are an integral
part of these statements.
5
CRYO-CELL INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
February 28, 2001
(Unaudited)
NOTE 1 - FINANCIAL STATEMENTS
- ------------------------------
The Consolidated Financial Statements including the Consolidated Balance
Sheet as of February 28, 2001, Consolidated Statements of Operations for the
three months ended February 28, 2001 and Consolidated Statement of Cash Flows
for the three months ended February 28, 2001 have been prepared by the Company,
without audit. 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 at February 28, 2001
and for all periods presented have been made.
Certain information and footnote disclosures normally included in
consolidated financial statements prepared in accordance with generally accepted
accounting principles have been condensed or omitted. It is suggested that
these condensed financial statements be read in conjunction with the financial
statements and notes thereto included in the Company's November 30, 2000 Annual
Report on Form 10-KSB.
NOTE 2 - MARKETABLE SECURITIES
- -------------------------------
Net/Tech International
In August 2000 Return on Investment Corporation (ROI) merged into Net/Tech
International, Inc. (NTTI). ROI exchanged one share of common stock for twenty
shares of NTTI common stock.
In November 1998 the Company's ownership percentage in Net/Tech
International Inc. (NTTI) decreased to less than 20% of the outstanding shares
of NTTI. In previous years, the Company accounted for its investment in NTTI
using the equity method but as of the date upon which its ownership percentage
fell below 20% the Company used the guidance in SFAS 115 Accounting for Certain
Investment in Debt and Equity Securities, to account for the investment. Since
NTTI stock was thinly traded and subject to considerable price fluctuation, if
the Company were to attempt to sell large blocks of shares, it was unlikely that
the Company would be able to obtain the exchange market value listed. This
security was therefore subject to considerable market risk as well as subject to
certain trading restrictions that limit the nuber of shares that can be sold
during a 90-day period.
The Company recognized losses under the equity method for the NTTI
investment during 1998 reducing the cost basis of the stock to $0. An
unrealized gain has been recorded as a component of stockholders equity in the
amount of $220,681 and $730,099 to reflect the fair market value of the
investment as of February 28, 2001 and February 29, 2000, respectively.
6
CRYO-CELL INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
February 28, 2001
(Unaudited)
NOTE 2 - MARKETABLE SECURITIES (CONT'D)
- ----------------------------------------
Other Securities
In 1997 the Company acquired 100,000 shares of an equity security in
payment for the sale of a Revenue Sharing Agreement. The original cost as
determined by the trading price on the date of acquisition was $400,000. In
February 2001, the Company sold 35,000 shares. The gross proceeds from the sale
was $39,531, which resulted in a loss of $100,474, which is recognized as a Loss
on the Sale of Securities. The fair value of this security as of February 28,
2001 and February 29, 2000 was $65,000 and $118,750, respectively and the
unrealized holding loss on this security was $195,000 and $281,250 as of
February 28, 2001 and February 29, 2000, respectively.
NOTE 3- COMMITMENTS AND CONTINGENCIES
- ---------------------------------------
In June 1998, the Company entered into an agreement with World Medical
Match, a non-profit corporation, whose mission includes assisting the poor with
funds to provide them access to medical matching opportunities. The agreement
states that World Medical Match agrees to grant the Company $50,000 for the
purpose of paying for 200 U-Cord/TM/ stem cell collection kits and the first
year of cryogenic storage for the benefit of indigent expectant parents. Upon
execution of the agreement the Company was granted $25,000, which is classified
as a deposit on the balance sheet. The Company is currently working with local
medical practices, hospitals, and other medical industry organizations to
implement this project.
In January 2000 the Company extended its marketing agreement with Lamaze
Publishing Company to sponsor the Lamaze You and Your Baby tutorial tape and
full page advertisements in the Lamaze Parent Magazine at a cost of $213,362. In
July 1999, the Company was informed that Lamaze Publishing Company was acquired
by iVillage, Inc., a leading online women's network. The Company's agreements
with Lamaze will remain in tact, including the exclusivity provisions as the
only cord blood preservation company on the Lamaze You and Your Baby educational
videotape through the year 2003.
On April 6, 2000, the Company entered into a renewable agreement with
COLTEC, Ltd. for the exclusive license to market the Company's U-CORD program in
Europe. The marketing rights allow COLTEC, Ltd. to directly market the U-CORD
program, sell revenue sharing agreements or further sub-license the marketing
rights throughout Europe. The Company received $1,400,000 in cash and licensing
fees of 10.5% to 20% of adjusted U-CORD processing and storage revenues to be
generated in Europe, and granted COLTEC, Ltd. a three year option to purchase
100,000 shares of the Company's common stock ($8.00 exercise price) and will
issue up to 100,000 additional options ($12.00 exercise price) as needed, to
facilitate sales of sub-licensing and/or revenue sharing agreements in Europe.
The Company recognized $465,000 of the licensing fees in fiscal 2000 and
$175,000 as of February 28, 2001. Subsequent to the licensing agreement date,
COLTEC, Ltd. formed a corporation, CRYO-CELL Europe, B.V. to engage in the
cryogenic cellular storage business under the agreement. On September 19, 2000,
the Company entered into an agreement to purchase approximately 6% of CRYO-CELL
Europe, B.V. In October and November 2000, the Company paid $1,000,000 for
38,760 shares of the capital stock of CRYO-CELL Europe, B.V. which the Company
owned on January 24, 2001.
7
CRYO-CELL INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
February 28, 2001
(Unaudited)
NOTE 4 - LEGAL PROCEEDINGS
- ---------------------------
On or about July 11, 1996, CRYO-CELL filed suit in San Francisco Superior
Court against the University of Arizona, Dr. David Harris and Cord Blood
Registry, Inc. (CBR). The suit claimed breach of contract and other related
business torts. After settlement discussions were unproductive, the University
of Arizona counter-sued CRYO-CELL for breach of contract and negligent
misrepresentation on March 27, 1997.
On July 20, 1998, as a result of the evidence, the jury awarded $1,050,000
against Defendant University of Arizona. In addition, an award of $120,000 was
granted against the University of Arizona and David Harris, individually, for
misappropriation of trade secrets. The court rejected three post-trial motions
by the University of Arizona including a request to reduce the award or set
aside the verdict.
On or about September 27, 1999 the Company accepted the University's offer
of $800,000 and settled the matter. On September 30, 1999, the Company received
$441,000 from the University of Arizona. The remaining balance of $359,000 is
being held in escrow, to satisfy a legal lien filed November 4, 1998 by the
Company's previous attorneys, Horwitz and Beam. The Company disputes their
position and has countersued Horwitz and Beam for malpractice and is seeking
$1,000,000 in compensatory damages and an unspecified amount of punitive damages
deemed appropriate by the court. CRYO-CELL retained the services of Horwitz &
Beam, a California law firm, to handle the above described lawsuit including its
allegations against CBR for interference in a legitimate contract between two
parties and unfair business practices, among other claims. The court granted a
summary judgment dismissal in favor of CBR. CRYO-CELL believes that Horwitz &
Beam mishandled the CBR aspect of the case and certain aspects of its case
against the University of Arizona. There is a dispute concerning the amount of
fees owed by the Company to Horwitz & Beam.
On March 8, 1999, the Company, the Company's CEO and Chairman, the
Company's Executive Vice President, and the Company's legal counsel were named
as the defendants in a lawsuit filed in the Superior Court of Orange County,
California by Horwitz & Beam, the attorneys which had represented CRYO-CELL in
its suit against the University of Arizona et al. The plaintiff alleges breach
of contract and seeks payment of $129,822 in allegedly unpaid fees and costs
associated with the University of Arizona litigation. The plaintiff also
asserts claims of misrepresentation. In reference to these misrepresentation
claims, plaintiff has filed a Statement of Damages, which asserts $1,000,000 in
general damages and $3,500,000 in punitive damages.
The Company believes there is no merit to the suit and that none of the
claimed $129,822 in fees is due and owing under the contract. The Company
believes that Horwitz & Beam brought this action and improperly sought punitive
damages for the purpose of interfering with the Company's efforts to raise and
maintain additional capital.
Accordingly, on June 14, 1999, the Company filed: (1) an answer
denying all liability; (2) a counterclaim for breach of contract and
malpractice, seeking in excess of $1 million in compensatory damages arising
from the malpractice; (3) a motion to dismiss the individual defendants for lack
of jurisdiction; and (4) a motion to dismiss all punitive damages allegations
against the Company.
On December 17, 1999, Judge Alicemarie H. Stotler of the United States
District Court in the Central District of California, issued an Order in which
she: (1) granted CRYO-CELL International, Inc.'s ("CRYO-CELL") Motion to Strike
Punitive Damages and Dismiss Part of the Complaint; (2) granted Daniel
Richard's, Mark Richard's and Gerald F. Maass' (the "Individual Defendants")
Motion to Dismiss Complaint for Lack of Personal Jurisdiction; and (3) granted
in part and denied in part Horwitz & Beam, Inc.'s ("H&B") Motion for Order
Dismissing Counterclaim and/or Strike Portions Thereof. As discussed
8
CRYO-CELL INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
February 28, 2001
(Unaudited)
NOTE 4 - LEGAL PROCEEDINGS
- ---------------------------
in more detail below, the net effect of this order was to reframe the Complaint
as a fee dispute, as opposed to a multi-million dollar claim for fraud against
CRYO-CELL and its corporate officers. By its order, the Court has barred
recovery in this action against the Individual Defendants, and has reduced CRYO-
CELL's exposure from over $3.5 million dollars to $129,822, plus a possible
award of attorneys' fees.
By granting CRYO-CELL's Motion to Strike Punitive Damages and Dismiss
Part of the Complaint, the Court dismissed H&B's Fourth Claim for Relief for
intentional misrepresentation, i.e., fraud, against CRYO-CELL and the Individual
Defendants. The Court held that the promises purportedly made to H&B concerning
the opening of an "escrow," even if not ultimately fulfilled, were not
fraudulent. In fact, the Court said that "although the Individual Defendants
clearly made representations that an 'escrow' would be established, their not
having done so, in light of uncertainties of the future course of litigation and
their misgivings of plaintiff's performance, suggests nothing more than a
negotiation of payment terms."
The Court granted CRYO-CELL's Motion to Strike Punitive Damages Claims
with respect to H&B's Fifth Claim for Relief because such damages are not
available in connection with negligence claims. Having dismissed the Fourth
Claim for Relief for Fraud, H&B's motion to strike the punitive damages claimed
in connection therewith was rendered moot.
NOTE 5 STOCKHOLDERS' EQUITY
- ------------------------------
During 2000, the Company received $21,000 in cash proceeds from the sales
of 5,000 shares of its common stock through private placements. The Company
also issued 879,250 common shares to option holders who exercised these options
in 2000 for $2,540,203. As of February 28, 2001 the Company issued 18,000
shares of its common shares to option holders who exercised options for $41,000.
The Company made payments for consulting services through the issuance of
common stock. Consulting fees of $40,000 were paid by the issuance of 10,000
common shares during the first quarter of fiscal 2001. The Company also issued
15,000 shares of its common stock to the University of South Florida per the
agreement made between the University and CCEL Bio-Therapies, Inc., a subsidiary
of the Company, during the first quarter of 2001.
The Company applies Accounting Principles Board Opinion No. 25, "Accounting
for Stock Issued to Employees" (APB 25) and related interpretations in
accounting for its stock options. Accordingly, compensation expense is
recognized for the amount of the excess of the market price over the exercise
price on the date of the grant.
In 2000, the Company incurred $124,010 in consulting expenses based on the
amortization portion of options issued to purchase 471,980 shares of the
Company's common stock. In February 2001 $33,270 is recognized as consulting
expenses based on the amortization portion. These options expire through 2004.
The Black-Scholes option-pricing model was developd for use in estimating
the fair value of traded options that are fully transferable. The Company's
options have the characteristics significantly different from those of traded
options. In addition, option valuation models require the input of highly
subjective assumptions, including the expected stock price volatility.
9
CRYO-CELL INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
February 28, 2001
(Unaudited)
NOTE 6 AGREEMENTS
- --------------------
Arizona
On February 9, 1999, the previous agreements with the Company's Arizona
Revenue Sharing investors were modified and replaced by a Revenue Sharing
Agreement for the state of Florida for a price of $1,000,000. Under the terms
of this agreement the Company credited the investors' previously paid $450,000
toward the purchase of the Revenue Sharing Agreement. The balance of $550,000
will be paid through their Revenue Sharing entitlements to their share of net
storage revenues. The Revenue Sharing Agreement applies to net storage revenues
originating from specimens from within the state of Florida. The Revenue
Sharing Agreement entitles the investors to net revenues from a maximum of
33,000 storage spaces and cancels the investor's obligation to provide the
Company with $675,000 plus accrued interest under the prior Arizona agreement.
Illinois
In 1996, the Company signed agreements with a group of investors entitling
them to an on-going 50% share in the Company's portion of net storage revenues
generated by specimens stored in the Illinois Masonic Medical Center. Since the
Company will no longer be storing new specimens in Chicago, the agreements were
modified in 1998 to entitle the investors to a 50% share of the Company's
portion of net revenues relating to specimens originating in Illinois and its
contiguous states and stored in Clearwater, Florida for a maximum of up to
33,000 spaces. The revenue generated by this Single Unit Revenue Sharing
Agreement was $1,000,000.
Bio-Stor, LLC
On February 26, 1999, the Company modified all previous agreements with
Bio-Stor, LLC. The modified agreement enters Bio-Stor into a Revenue Sharing
Agreement for the state of New York. The Company will credit Bio-Stor's
$900,000 (previously paid) toward the purchase of 90% of its 50% share in CRYO-
CELL's portion of net storage revenues generated by the specimens originating
from the Company's clients in the state of New York for up to 33,000 shared
spaces. This agreement supersedes all other agreements between Bio-Stor, LLC
and the Company.
Tenet HealthSystem Hospitals, Inc.
On November 30, 1996, the Company signed agreements with OrNda HealthCorp.
Two "one-third" Revenue Sharing Agreements were purchased in which OrNda paid
the Company $666,666. OrNda was acquired by Tenet Healthcare Corporation, which
agreed to be bound by the terms of the OrNda agreements. The agreements were
renegotiated and the Company will store all Tenet originated specimens at its
headquarter's lab in Clearwater, Florida while paying Tenet a revenue sharing
entitlement.
New Jersey
On November 30, 1999, the Company entered into agreements with two
investors entitling them to on-going shares in a portion of CRYO-CELL's net
storage revenue generated by specimens originating from within the state of New
Jersey. Deposits totaling $50,000 were received upon signing of the agreements
and the remaining $450,000 was originally due in May 2000. In May 2000 the
original due date for the remaining balance was extended to April 2001. As of
February 28, 2001 the remaining balance due is $380,000. Upon receipt of the
balance due the investors will be entitled to a portion of net storage revenues
generated to a maximum of 33,000 storage spaces.
10
CRYO-CELL INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
February 28, 2001
(Unaudited)
NOTE 6 AGREEMENTS (CONT'D)
- -----------------------------
Saggi Capital
In November 1998, the Company entered into an investor relations agreement
with Saggi Capital Corporation. Saggi Capital agreed to provide various business
consulting and investor relations services for the Company. Per the agreement
the Company registered 200,000 options to purchase the Company's common stock at
an exercise price of $1.00 per share. These options have been exercised and
common stock has been issued to Saggi. The Company did not recognize an expense
on the issuance of these options since the Company's common stock was trading
below the exercise price on the date of grant. In January 2000, the Company
renewed its contract with Saggi Capital. The Company has terminated this
agreement effective January 2001.
Women & Infants' Hospital of Rhode Island
In June 1998, the Company signed an agreement with Women & Infants'
Hospital of Rhode Island ("hospital") for the establishment of a commercial
placental/umbilical cord blood bank at their Providence, Rhode Island medical
facility. The hospital will be offering its stem cell banking services to
parents of approximately 9,000 babies who are born each year at this facility.
Under the terms of the agreement the hospital will provide the space and
utilities, liquid nitrogen supply, technician, etc. CRYO-CELL will be
responsible for the billing activities. The storage revenues will be divided 75%
to the Company and 25% to the hospital, while the hospital is entitled to 100%
of the processing revenue. Additionally, if processing revenue is insufficient
to cover the fixed costs of the cord blood bank, CRYO-CELL will be responsible
to pay the shortfall. In order to cover the possible shortfall the hospital
required $50,000 to be placed in escrow. The $50,000 is classified as cash on
the balance sheet.
Other Agreements
On November 5, 1998 an agreement previously entered into by the Company
with a private investor was revised. Per the terms of the original agreement,
the investor had purchased 10% of a Revenue Sharing Agreement in the state of
New Jersey. The new agreement has transferred the $100,000 investment to the
state of New York. Under the revised agreement the investor will receive 10% of
the 50% share in CRYO-CELL's portion of net storage revenues generated by the
specimens originating from the Company's clients in the state of New York for up
to 33,000 spaces.
University of South Florida at Tampa
In February 2000, the Company, through its subsidiary CCEL BIO-THERAPIES,
Inc., entered into a research agreement with the University of South Florida at
Tampa to collaborate on a technology for the potential treatment of a number of
debilitating degenerative diseases. The research project is to be conducted at
the University's laboratory facilities. In March 2000, the Company transferred
$200,000 to CCEL BIO-THERAPIES, Inc. to meet its funding commitment. CCEL BIO-
THERAPIES, Inc. and the University are co-assignees of a filed patent
application covering the technology. An application has been made for federal
grants (SBIR and STTR research grants) on behalf of the Company and CCEL BIO-
THERAPIES, Inc. In addition, an application is being filed for a State of
Florida I-4 matching grant. The Company has been granted worldwide marketing
rights for any product developed as a result of this research program. Under the
terms of the agreement, the University will receive standard royalty payments on
any product sales. In February 2001, the Company paid the University an initial
$100,000 license payment with the issuance of 15,000 shares of the Company's
common stock.
11
CRYO-CELL INTERNATIONAL, INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
February 28, 2001
(Unaudited)
NOTE 7 RECEIVABLE LITIGATION
- -------------------------------
On or about September 27, 1999 the Company accepted the University of
Arizona's offer of $800,000 to settle its litigation. In September 1999, the
Company received $441,000 from the University of Arizona leaving a balance of
$359,000 that is being held in escrow to satisfy a legal lien filed November 4,
1998 by the Company's previous attorneys, Horwitz and Beam. The Company reduced
the award to $510,178 and recognized this as gain on litigation. This reduction
includes a 20% contingency fee ($160,000) to the Company's previous attorneys
and $129,822 in contested legal fees that the Company feels are not due and
owing under the contract (See Note 4). When the $289,822 is netted against the
$359,000 held in escrow the result is a receivable balance of $69,178. The
Company has requested the release of the $69,178 from escrow, which is the
excess of 20% of the $800,000 actual settlement amount. The overage is a result
of the Company's settlement of the $1,170,000 original jury award.
Item 2. Management's Discussion and Analysis or Plan of Operation.
CRYO-CELL International, Inc. was incorporated on September 11, 1989 in the
state of Delaware. It is engaged in cryogenic cellular storage and the design
and development of cellular storage devices. The Company's current focus is on
the processing and preservation of umbilical cord (U-Cord/TM/) blood stem cells
for autologous/sibling use. Having recently celebrated its 10-year anniversary,
the Company believes that it is the fastest growing commercial firm currently
specializing in separated umbilical cord blood stem cell storage. CRYO-CELL has
pioneered several technologies that allow for the processing and storage of
specimens in a cryogenic environment. The Company's original mission of
affordability for U-Cord blood preservation remains in effect. These
technologies include a process for the storage of fractionated (separated) U-
Cord stem cells and the development and patenting of the first computer
controlled, robotically operated cryogenic storage system. Its headquarters
facility in Clearwater, FL handles all aspects of its business operations
including the processing and storage of specimens in one site. Several other
companies involved in commercial cell banking rely on shipping their specimens
elsewhere for processing and storage.
It is the Company's mission to make expectant parents aware of the
potential medical benefits from preserving stem cells and to provide them the
means and processes for collection and storage of these cells. Today, stem cell
transplants are known and accepted treatments for a number of life-threatening
diseases. With continued research in this area of medical technology, other
avenues for their potential use and expansion are being explored. A vast
majority of expectant parents are simply unaware that umbilical cord blood
contains a rich supply of stem cells and that they can be collected, processed
and stored for the potential future use of the newborn and possibly related
family members. A baby's stem cells will remain a perfect match for the baby
throughout its life and have a 1-in-4 chance (or better) of being a perfect
match for a sibling. There is no assurance, however, that a perfect match could
treat certain diseases. Today, it is still common for the cord blood (the blood
remaining in the umbilical cord and placenta) to be discarded at the time of
birth as medical waste. Obviously, the Company believes that no U-Cord specimen
should be discarded when it could possibly save a life.
Given the potential benefits of U-Cord stem cell preservation, the number
of stored parents of newborns participating in stem cell preservation
is still relatively small compared to the number of births (four
million per annum) in the United States alone. Critical reasons for this low
level of market penetration are the misperception of the high cost of stem cell
storage as well as a general lack of awareness of the benefits of stem cell
preservation programs. However, evolving medical technology could significantly
increase the utilization of the U-Cord blood for transplantation and/or other
types of treatments. A number of competitors in this market have been charging
upwards of $1000 - $1500 for this stem cell
12
preservation plus higher annual fees for storage than the Company charges. The
cost is usually not covered by insurance. The Company has made this procedure
affordable and within financial reach of most families. The growth and
profitability of the Company should come from increases in stem cell specimen
storage volume driven by its marketing approaches, resulting in an increasing
base of annual stem cell storage renewal fees.
In June 1998, the Company signed an agreement with Women & Infants Hospital
of Rhode Island. The Company has offered Its U-Cord program services for the
potential medical benefit of the approximately 9,000 babies born annually at the
hospital.
During 2001, all U-Cord/TM/ blood processing and preservation will be done
at the Company's facility. It is anticipated that this shift in focus will
limit the number of new Lifespan/SM/ Center implementations in the future.
During the period since its inception, the Company's research and
development activities have principally involved the design and development of
its cellular storage systems ("CCEL Cellular Storage System") and in securing
patents on the same.
The Company believes that its long-term cellular storage units can provide
an improved ability to store cells or other material in liquid nitrogen, its
vapors or other media. The units are controlled by a computer system, which
robotically inserts vials in pre-selected storage areas inside the chamber.
Additionally, the stored material can be robotically inserted or retrieved by
computer on an individual basis without all of the remaining specimens being
exposed to ambient temperature. The efficient use of storage space and a dual
identification system for inventory control is a competitive advantage for the
Company. The Company is the assignee of all patents on the units.
Other cryopreservation systems are manually operated and can expose the
laboratory technician to liquid nitrogen when inserting or retrieving specimens.
Moreover, the use of these units exposes the remaining stored specimens to
ambient temperature whenever specimens are inserted or retrieved. The Company
has designed and holds patents on a system which makes use of the latest in
computer, robotics and bar code laser scanning identification technologies.
The unit is currently assembled by an independent manufacturer utilizing
the Company's patented designs.
In February 1999, the Company was granted a patent on the CCEL III computer
controlled robotically operated cellular storage system which is designed to be
multi-functional. When completely developed the unit will be able to store more
than 35,000 5ml vials, and many times that number of smaller vials. Because the
CCEL III is multi-functional it is currently being evaluated for various other
uses.
The following is a discussion and analysis of the financial condition and
results of operations of the Company for the quarter ended February 28, 2001 as
compared to the same period of the prior year.
General
To increase awareness of its services, the Company has invested in a
variety of marketing programs designed to educate expectant parents and those
medical caregivers to whom they turn to for advice.
The Company markets its preservation services to expectant parents and by
distributing information to obstetricians, pediatricians, Lamaze instructors and
other, childbirth educators, certified nurse-midwifes and other
related healthcare professionals. The Company has clinical educators
based in several regions who work with the medical community and with
expectant parents to educate them on cord blood stem cell preservation. The
Company also has a clinical support team of specially trained nurses
who are available 24 hours, 7 days a week to educate expectant parents and the
medical community on the life-saving potential of cord blood stem cell
preservation. In addition, the Company exhibits at conferences, trade shows and
other media focusing on the expectant parent market. The
13
Company is realizing an increasing level of interest from its Web site,
www.CRYO-CELL.com.
In January 2000 the Company renewed its agreement with the Lamaze
Publishing Company to sponsor the Lamaze You and Your Baby tutorial tape. The
agreement has been extended for three (3) years and calls for Lamaze to
distribute the videotape to 1.8 million women in their third trimester of
pregnancy. Over 90% of first time mothers and 45% of the pre-natal market avail
themselves of the Lamaze Institute for Family Education proven instruction
programs. The tutorial tape, which is distributed by approximately 9over 10,000
instructors, discusses the importance of cord blood storage and refers viewers
to the full-page ad that the Company has placed in the Lamaze Parents Magazine,
which is distributed to 2.4 million expectant mothers. During 2000, 600,000 You
and Your Baby CD's were distributed through WAL-MART stores for the first time.
The Company also places an ad in Lamaze para Padres, Lamaze Publishing's
magazine for Hispanic mothers-to-be. The Company has exclusivity on the
tutorial tape in the cord blood storage category and first right of refusal for
renewal of the agreement beyond 2003.
In March 2000, the Company became a sponsor of the 2000 ACOG (American
College of Obstetricians and Gynecologists) Meeting CD-ROM. The CD includes a
segment on the Company's U-Cord/TM/ program and was distributed to approximately
40,000 ACOG members in November 2000. The Company is the only cord blood
preservation firm featured on the CD-ROM.
In March 2000, the Company launched its Mother to Mother/TM/ Educational
Network program to offer the Company's umbilical cord blood preservation program
to expectant parents. The network is comprised of clients who have stored their
newborn's U-Cord blood stem cells with the Company. These independent
contractors contact expectant parents, OB/GYN's and medical caregivers advising
them of the Company's affordable service.
The Company's advertisements have appeared in, or are scheduled for
insertion in, several national targeted prenatal magazines including American
Baby, Pregnancy, Baby Talk and Fit Pregnancy. Expectant parents have also
received information via emails and newsletter links through BabyCenter.com.
BayNews 9, a CNN affiliate, and NewsChannel 10 have both carried stories about
CRYO-CELL's affordable service.
In January 2001, the Company established the Grandparent's Legacy Program.
Through this program, grandparents can provide the gift of cord blood stem cell
preservation for their grandchildren.
In September 1999, the Company was granted a Blood Bank license to operate
in the state of New Jersey. The Company is now authorized to operate in all 50
states.
In February 2000, the Company, through its subsidiary CCEL BIO-THERAPIES,
Inc., entered into a research agreement with the University of South Florida at
Tampa to collaborate on a technology for the potential treatment of a number of
debilitating degenerative diseases. The research project is being conducted at
the University's laboratory facilities. In March 2000, the Company transferred
$200,000 to CCEL BIO-THERAPIES, Inc. to meet its funding commitment under this
agreement. CCEL BIO-THERAPIES, Inc. and the University are co-assignees of a
filed patent application covering the technology utilizing cord blood for the
treatment of neurological degenerative diseases. An application has been made
for federal grants (SBIR and STTR research grants) on behalf of the Company and
CCEL BIO-THERAPIES, Inc. If the grants are approved an additional $100,000 per
grant will be received, which will be used to further research. In addition, the
application for a State of Florida I-4 matching grant has been approved for
$100,000, which will also be used for research. The Company has been granted
worldwide marketing rights for any product developed as a result of this
research program. Under the terms of the agreement, the University will receive
standard royalty payments on any product sales. In February 2001, the Company
paid the University an initial $100,000 license payment with the issuance of
15,000 shares of the Company's common stock.
On April 6, 2000, the Company entered into a renewable agreement with
COLTEC, Ltd. for the exclusive license to market the Company's U-CORD program in
Europe. The marketing rights
14
allow COLTEC, Ltd. to directly market the U-CORD program, sell revenue sharing
agreements or further sub-license the marketing rights throughout Europe. The
Company received $1,400,000 in cash and licensing fees of 10.5% to 20% of
adjusted U-CORD processing and storage revenues to be generated in Europe, and
granted COLTEC, Ltd. a three year option to purchase 100,000 shares of the
Company's common stock ($8.00 exercise price) and will issue up to 100,000
additional options ($12.00 exercise price), as needed, to facilitate sales of
sub-licensing and/or revenue sharing agreements in Europe. The Company
recognized $465,000 of the licensing fees in 2000. Subsequent to the licensing
agreement date, COLTEC, Ltd. formed a corporation, CRYO-CELL Europe, B.V. to
engage in the cryogenic cellular storage business under the agreement. At
September 19, 2000 the Company entered into an agreement to purchase
approximately 6% of CRYO-CELL Europe, B.V. In October and November 2000, the
Company paid $1,000,000 for 38,760 shares of the capital stock of CRYO-CELL
Europe, B.V. that the Company owned on January 24, 2001.
The Company has established a Medical & Scientific Advisory Board comprised
of the more than 10 researchers, physicians and scientists from various fields
such as oncology, stem cell research, hematology, genetic research, assisted
reproduction and other specialties. Many of the Company's Advisory Board members
are heads of departments and are committed to cellular storage as part of new
services to improve patient care and saves lives.
Management
At present there are 24 employees on the staff of the Company. Daniel D.
Richard serves as the Chairman of the Board and Chief Executive Officer.
Daniel D. Richard, Chairman of the Board, President and Chief Executive Officer.
Mr. Richard is the founder of the Company and co-inventor of much of the
Company's technology it currently employs. Mr. Richard has served as
Chairman of the Board since the Company's inception. Prior to founding
the Company, Mr. Richard was the first officer and director of Marrow-Tech,
Inc., a publicly traded company engaged in the field of cellular replication.
Mr. Richard was also the President of Daniel Richard Consultants, Inc., a
marketing firm which operated in forty-four cities in the U.S. and throughout
the world.
Wanda D. Dearth, President and Chief Operating Officer. Ms Dearth joined the
Company in June 2000. Ms. Dearth joined the Company from kforce.com (formerly
Romac International, Inc.) where she was Business Unit Vice President for the
nurse staffing division. Ms. Dearth has a history of over 15 years placing
physicians and nurses throughout the U.S. She has over 20 years of marketing
and operational experience with the majority of her career specializing in
start-up operations. Ms. Dearth graduated from Miami University of Ohio with a
B. S. in Business Administration. In October 2000, Ms. Dearth was appointed a
member of the Company's Board of Directors.
Gerald F. Maass, Executive Vice President and General Manager. Mr. Maass joined
the Company in March 1998. Prior to joining the Company Mr. Maass worked for
Critikon, a subsidiary of Johnson & Johnson, where his most recent position was
International Director of Marketing for the Patient Monitoring business. Mr.
Maass' ten-year tenure with Johnson and Johnson included several marketing and
business development roles; he also served on the Critikon management committee.
Prior to Johnson & Johnson, Mr. Maass was with Baxter Healthcare and Control
Data Corporation in marketing, sales management, business development and
business management roles. Mr. Maass began his career with Mayo Clinic in
Rochester, MN and holds a B.S. degree in Medical Technology. In September 1998,
Mr. Maass was appointed a member of the Company's Board of Directors.
Geoffrey J. O'Neill, Ph.D., Laboratory Director. Dr. O'Neill joined the company
in April 1999 and has oversight of the Company's processing laboratory and
storage facility. He has over 25 years experience in human hematopoetic
progenitor cell therapy, including expertise in the processing, cryopreservation
and storage of stem cells, flow cytometry analysis, HLA typing and CD34+ cell
purification. Dr. O'Neill also has expertise in immunohematology and blood
banking. A co-author of many publications, he has an undergraduate degree in
microbiology and a Ph.D. in Immunology.
15
Jill Taymans, Chief Financial Officer. Ms. Taymans joined the Company in April
1997 serving initially as Controller and was appointed CFO in May 1998. Ms.
Taymans graduated from the University of Maryland in 1991 with a BS in
Accounting. She has worked in the accounting industry for over nine years
in both the public and private sectors. Prior to joining the company she served
for three years as Controller for a telecommunications company in Baltimore,
Maryland.
E. Thomas Deutsch, III, Director of Systems Chief Information
Officer. Mr. Deutsch joined the Company in May 1996 and is a software and
process engineer, specializing in healthcare information systems. He graduated
from the University of North Carolina in Chapel Hill in 1986 with a bachelor of
B.. S. degree in Mathematics. Prior to joining the Company in 1996, Mr.
Deutsch worked for Shared Medical Systems in Malvern, PA, IBM in Atlanta, GA,
and HBO and Company in Atlanta, GA. His responsibilities include developing,
implementing and supporting the Company's communications and information
systems, developing, implementing and supporting the Company's Internet plan and
systems engineering for the patented CCEL II Cellular Storage System.
Results of Operations
Revenues. Revenues for the three months ended February 28, 2001 were $761,618
as compared to $425,903 for the same period in 1999 representing a 79% increase.
The increase in revenues reflects the significant growth in the processing and
storage revenue associated with the Company's U-Cord/TM/ stem cell program. The
Company believes that the growth is a result of its investments in its various
marketing programs, including its activities with Lamaze Publishing, and the
increased traffic on its updated Web site www.CRYO-CELL.com. The upward sales
trend has continued into the second quarter of fiscal 2001.
Cost of Sales. Cost of sales for the three months ended February 28, 2001 were
$264,448 as compared to $163,607 in 2000. The cost of sales for the three
months ended February 28, 2001 and February 29, 2000 represents the associated
expenses resulting from the processing and testing of the U-Cord/TM/ specimens
in the Company's own state of the art laboratory in Clearwater, Florida.
Marketing, General and Administrative Expenses. Marketing, general and
administrative expenses during the three months ended February 28, 2001 were
$808,948 as compared to $576,636 in 2000. The increase reflects, in part, the
expenses of additional executive management, market development, lab operations
support and clinical services expansion associated with the growth of the
Company's cellular storage program.
Research, Development and Related Engineering Expenses. Research, development
and related engineering expenses for the three months ended February 28, 2001,
were $17,591 as compared to $21,191 in 2000. The expenses incurred in 2001
reflect the funding of the research project between the Company's a subsidiary,
CCEL Bio-Therapies, Inc., and the University of South Florida at Tampa. The
reduction reflects the impact of previous investments regarding the Company's
third generation cellular storage system.
Liquidity and Capital Resources
At February 28, 2001, the Company had cash and cash equivalents of
$2,560,901 as compared to $1,530,177 at February 29, 2000. The increase in cash
and cash equivalents was due primarily to the exercise of stock options in 2000
and the income received from the sale of the Company's European marketing
rights.
16
Forward Looking Statements
In addition to historical information, this report contains forward-looking
statements within the meanings of Section 27A of the Securities Act of 1933 and
Section 21E of the Securities Exchange Act of 1934. The forward-looking
statements contained herein are subject to certain risks and uncertainties that
could cause actual results to differ materially from those reflected in the
forward-looking statements. Factors that might cause such differences include,
but are not limited to, those discussed in the section entitled "Management's
Discussion and Analysis or Plan of Operation." Readers are cautioned not to
place undue reliance on these forward-looking statements, which reflect
management's analysis only as of the date hereof. CRYO-CELL International, Inc.
(the "Company") undertakes no obligation to publicly revise these forward-
looking statements to reflect events or circumstances that arise after the date
hereof. Readers should carefully review the risk factors described in other
documents the Company files from time to time with the Securities and Exchange
Commission, including the most recent Annual Report on Form 10-K, Quarterly
Reports on Form 10-Q to be filed by the Company in 1999 and any Current Reports
on Form 8-K filed by the Company.
17
PART II - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
- -------------------------
I. In December,December 1992, CRYO-CELL entered into an exclusive agreement
with the University of Arizona to develop and enhance a commercial (paid
for) cord blood stem cell bank. Prior to this agreement the University of
Arizona had not commenced storing any cord blood specimens. CRYO-CELL
provided the means for the University to obtain approximately 1400 paying
clients. Prior to the termination of the exclusive agreement, which CRYO-
CELL alleges was unwarranted,unwarranted, the University breached its
contract with CRYO-CELL and entered into an Agreement with Cord Blood
Registry, Inc. (CBR).
On or about July 11, 1996, CRYO-CELL filed suit in San Francisco Superior
Court against the University of Arizona, Dr. David Harris and Cord Blood
Registry, Inc. The suit claimed breach of contract and other related
business torts. Months later, after settlement discussions were
unproductive, the University of Arizona counter-sued CRYO-CELL for breach
of contract and negligent misrepresentation.
On July 20, 1998, as a result of the evidence, the jury awarded $1,050,000
against Defendant University of Arizona. In addition, an award of $120,000
was granted against the University of Arizona and David Harris,
individually, for misappropriation of trade secrets. The jury voted
unanimously against the University and in favor of CRYO-CELL as to the
counter claims. The court rejected three post-trial motions by the
University of Arizona including a request to reduce the award or set aside
the verdict.
On or about September 27, 1999 the Company accepted the University's offer
of $800,000 and settled the matter in order to avoid a lengthy and costly
appeals process. On September 30, 1999, the Company received $441,000 from
the University of Arizona. The remaining balance of $359,000 is being held
in escrow, to satisfy a legal lien filed November 4, 1998 by the Company's
previous attorneys, Horwitz and Beam. The Company disputes their position
and has counter sued sued Horwitz and Beam for malpractice and is
seeking $1,000,000 in compensatory damages and an unspecified amount of
punitive damages deemed appropriate by the court.
II. CRYO-CELL retained the services of Horwitz & Beam, a California law firm,
to handle the above-described lawsuit including its allegations against CBR
for interference in a legitimate contract between two parties and unfair
business practices, among other claims. The court granted a summary
judgment dismissal in favor of CBR. CRYO-CELL believes that Horwitz & Beam
mishandled the CBR aspect of the case and certain aspects of its case
against the University of Arizona by failing to depose CBR defendents on a
timely basis and failing to respond to the University's request for an
exemption from punitive damages (stating they were a public entity), among
others. Without this evidence, t he court granted a summary judgment
dismissal in favor of CBR. There is a dispute as to whether Horwitz and
Beam is entitled to the fees of $129,822 they claim is owed by the Company.
On March 8, 1999, the Company, the Company's CEO and Chairman, the
Company's Executive Vice President, and the Company's legal counsel were
named as the defendants in a lawsuit filed in the Superior Court of Orange
County, California by Horwitz & Beam, the attorneys which had represented
CRYO-CELL in its suit against the University of Arizona et al. The
plaintiff alleges breach of contract and seeks payment of $129,822 in
allegedly unpaid fees and costs associated with the University of Arizona
litigation. The plaintiff also asserts claims of misrepresentation. In
reference to these misrepresentation claims, plaintiff has filed a
Statement of Damages, which asserts $1,000,000 in general damages and
$3,500,000 in punitive damages.
Accordingly, on June 14, 1999, the Company filed: (1) an answer denying
all liability; (2) a counterclaim for breach of contract and malpractice,
seeking in excess of $1 million in compensatory damages arising from the
malpractice; (3) a motion to dismiss the individual defendants for lack of
jurisdiction; and (4) a motion to dismiss all punitive damages allegations
18
against the Company.
On December 17, 1999, Judge Alicemarie H. Stotler of the United States
District Court in the Central District of California, issued an Order in
which she: (1) granted CRYO-CELL International, Inc.'s ("CRYO-CELL") Motion
to Strike Punitive Damages and Dismiss Part of the Complaint; (2) granted
Daniel Richard's, Mark Richard's and Gerald F. Maass' (the "Individual
Defendants") Motion to Dismiss Complaint for Lack of Personal Jurisdiction;
and (3) granted in part and denied in part Horwitz & Beam, Inc.'s ("H&B")
Motion for Order Dismissing Counterclaim and/or Strike Portions Thereof. As
discussed in more detail below, The net effect of this order was to
reframe the Complaint as a fee dispute, as opposed to a multi-million
dollar claim for fraud against CRYO-CELL and its corporate officers. By its
order, the Court has barred recovery in this action against the Individual
Defendants, and has reduced CRYO-CELL's exposure from over $3.5 million
dollars to $129,822, plus a possible award of attorneys' fees.
CRYO-CELL has established an escrow in the amount of $359,000 to cover the
disputed legal fees ($129,822) and the 20% recovery of the Judgement
against the University of Arizona and David Harris. The Company has
requested the release of approximately $70,000 from escrow, which is the
excess of 20% of the $800,000 actual settlement amount. The overage is a
result of CRYO-CELL's settlement of the $1,170,000 original jury award.
19
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
- ------- --------------------------------
(a) Exhibits
3.1 Certificate of Incorporation (1)
3.11 Amendment to Certificate of Incorporation (1)
3.2 By-Laws (1)
3.21 Board Minutes to Amendment of By-Laws (1)
10.11 Agreement with InstaCool of North America, Inc. (2)
10.12 Agreement with the University of Arizona (2)
10.13 Agreement with Illinois Masonic Medical Center (4)
10.14 Agreement with Bio-Stor (4)
10.15 Agreement with Gamida-MedEquip (4)
10.16 Agreement with ORNDA HealthCorp (Tenet HealthSystem
Hospitals, Inc.) (4)
10.17 Convertible Note from Net/Tech International, Inc.
Dated November 30, 1995 (3)
10.18 Amended Agreement with Bio-Stor (5)
10.19 Agreement with Dublind Partners, Inc. (6)
10.20 Agreement with Medical Marketing Network, Inc. (6)
21 List of Subsidiaries (3)
(1) Incorporated by reference to the Company's Registration Statement on
Form S-1 (No. 33-34360).
(2) Incorporated by reference to the Company's Annual Report on
Form 10-K for the year ended November 30, 1994.
(3) Incorporated by reference to the Company's Annual Report on
Form 10-K for the year ended November 30, 1995.
(4) Incorporated by reference to the Company's Annual Report on
Form 10-K for the year ended November 30, 1996.
(5) Incorporated by reference to the Company's Annual Report on
Form 10-K for the year ended November 30, 1997.
(6) Incorporated by reference to the Company's Annual Report on
Form 10-K for the year ended November 30, 1998.
(7) Incorporated by reference to the Company's Annual Report on
Form 10-K for the year ended November 30, 1999.
(8) Incorporated by reference to the Company's Annual Report on
Form 10-K for the year ended November 30, 2000.
(b) Reports on Form 8-K.
(1) Form 8-K filed September 12, 1997 - Resignation of William C. Hardy as
President, Chief Operating Officer and member of the Board.
Resignation of Leonard Green from the Board of Directors.
(2) Form 8-K filed November 18, 1997 - Company filed a multi-count lawsuit
in the United States District Court, Northern District of New York
claiming that Stainless Design Corporation of Saugerties, New York
breached its contract.
(3) Form 8-K filed February 16, 2000 - The judge issued an order in which
she (1) granted the Company's motion to strike punitive damages and
dismiss part of the complaint, (2) granted Daniel Richard's, Mark
Richard's and Gerald Maass' motion to dismiss complaint for lack of
personal jrisdiction, and (3) granted in part and denied in part
Horwitz & Beam, Inc.'s motionto for order dismissing counterclain
and/or strike portions thereof.
(4) Form 8-K filed June 6, 2000 - Appointment of Wanda D. Dearth as
President and Chief Operating Officer.
Supplemental Information to be furnished with reports filed pursuant
to Section 15(d).
(c) No annual reports or proxy material have been sent to security holders
for the current fiscal year. Copies of any such report or proxy material
so furnished to security holders subsequent to the filing of the annual
report on this form will be furnished to the Commission when sent to
security holders.
20
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
CRYO-CELL INTERNATIONAL, INC.
/s/ DANIEL D. RICHARD
----------------------------------
Daniel D. Richard
Chief Executive Officer
Date: April 13, 2001
21