CRYO CELL INTERNATIONAL INC

The consolidated financial statements and supplementary data listed in the accompanying Index to Consolidated Financial Statements are attached as part of this report.

The following consolidated financial statements of Cryo-Cell International, Inc. are included in Item 8:

All other schedules for which provision is made in the applicable accounting regulations of the Securities and Exchange Commission are not required under the related instructions, are already included in the Notes to Consolidated Financial Statements included under this Item 8 or are inapplicable, and therefore have been omitted.

To the Board of Directors and Stockholders

Cryo-Cell International, Inc.

Oldsmar, Florida

Opinion on the Financial Statements

We have audited the accompanying consolidated balance sheets of Cryo-Cell International, Inc. and subsidiaries (the “Company”), as of November 30, 2023 and 2022, and the related consolidated statements of operations, changes in stockholders’ deficit, and cash flows for the years then ended and the related notes to the consolidated financial statements (collectively, the financial statements). In our opinion, the financial statements present fairly, in all material respects, the financial position of the Company as of November 30, 2023 and 2022, and the results of its operations and its cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (PCAOB) and are required to be independent with respect to the Company in accordance with U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matters

The critical audit matters communicated below are matters arising from the current period audit of the financial statements that were communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.

Estimate of Public Inventory Valuation and Contingent Consideration – valuation related to the amount of public inventory sales

As described in Notes 1 and 2 to the financial statements, the Company’s inventory of finished goods related to public inventory totaled $5,599,238 and contingent consideration related to sales of public inventory totaled $44,226.

Inventories are recorded at the lower of cost or net realizable value. Management periodically evaluates the carrying value of public inventories in relation to the forecasts of demand and sales trends. When sales trends indicate cost capitalized into public inventories will not be recoverable, an impairment is recorded for excess inventories. Changes in assumptions of demand could have a significant impact on the amount of impairment recorded. An impairment charge of $3,737,133 was made during the year.

Contingent consideration represents the fair value of estimated earnout payments the Company will make to another company from which the Company acquired the majority of public inventory. Earnout payments are based on sales revenue from the acquired public inventory. Changes in assumptions of demand and related sales revenue from public inventory could have a significant impact on fair value of contingent consideration.

Given the inherent uncertainty in forecasting demand, auditing the reasonableness of management’s estimates and assumptions required a high degree of auditor judgment and an increased extent of effort.

Our procedures related to management’s forecasts of demand used to record an impairment for excess inventories and fair value of contingent consideration included the following, among others:

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We evaluated management’s ability to accurately forecast product demand by comparing actual results to management’s historical estimates.

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We tested the mathematical accuracy of management’s calculations.

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Performed corroborative inquiries with the personnel responsible for sales forecasting to evaluate the reasonableness of the demand forecasts.

Evaluation of Duke License Agreement for Impairment

As described in Notes 1 and 18 to the financial statements, the Company had recorded a long-lived asset related to a Patent and Technology License Agreement with Duke.

The Duke License Agreement was initially recorded at the present value of cash flow of the total purchase price. The asset was to be amortized over the expected life of the agreement. When indicators of possible impairment are apparent, an impairment analysis is performed to determine the likely realizable amount of the asset. If the realizable amount is less than what is recorded, an impairment is recorded. Due to events that transpired in the fourth quarter of fiscal 2023, management performed an impairment analysis, and an impairment charge of $13,108,064 was recorded.

Given the inherent uncertainty in forecasting future cash flows, auditing the reasonableness of management’s estimates and assumptions required a high degree of auditor judgment and an increased extent of effort. Our procedures related to management’s forecasts of future cash flows used to record an impairment for the Duke License Agreement asset included the following, among others:

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We assessed the methodologies used to estimate future cash flows and estimate fair values.

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We tested the significant assumptions used to develop the estimates of future cash flows and fair values.

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We tested the completeness and accuracy of the underlying data used by the Company in its analysis.

/s/ Wipfli LLP

We have served as the Company’s auditor since 2016.

Atlanta, Georgia

February 28, 2024