-------------------------------------------------------------------------------


                     U.S. SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-QSB

     [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                     FOR THE QUARTER ENDED November 30, 1999

                                       OR

     [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934

                         COMMISSION FILE NUMBER 0-22720

                              CYCLO3PSS CORPORATION
           (Name of Small Business Issuer as specified in its charter)

                 Delaware                               87-0455642
          -----------------------                 ---------------------
       (State or other jurisdiction of              (I.R.S. Employer
        Incorporation or organization)               Identification No.)

          3646 West 2100 South
          Salt Lake City, Utah                            84120-1202
       ---------------------------                       ------------
 (Address of principal executive offices)                 (Zip Code)

            Issuer's telephone number, including area code: (801) 972-9090

      Securities registered pursuant to Section 12(b) of the Exchange Act: None

     Securities  registered pursuant to Section 12(g) of the Exchange Act: $.001
Par Value Common Stock

       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 .

Common Stock  outstanding  at January 14, 2000 - 22,119,617  shares of $.001 par
value Common Stock.


                    DOCUMENTS INCORPORATED BY REFERENCE: NONE

-------------------------------------------------------------------------------
<PAGE>





                                   FORM 10-QSB

                       Financial Statements and Schedules
                              Cyclo3pss Corporation

                For Three and Nine Months Ended November 30, 1999

     The following financial  statements and schedules of the registrant and its
consolidated subsidiaries are submitted herewith:


                         PART I - FINANCIAL INFORMATION

                                                                 Page of
                                                             Form 10-QSB
   Item 1. Financial  Statements

           Condensed Consolidated Balance Sheets.......................3
           Condensed Consolidated Statements of Operations.............5
           Condensed Consolidated Statements of Cash Flow..............7
           Notes to Condensed Consolidated Financial Statements........8

   Item 2. Management's Discussion and Analysis or
           Plan of Operations.........................................12

                            PART II - OTHER INFORMATION

   Item 1. Legal Proceedings .........................................20

      Item 2Changes in Securities.....................................20

      Item 3Defaults Upon Senior Securities...........................20

      Item 4Submission of Matters to a Vote of Security Holders.......20

      Item 5Other Information.........................................20

      Item 6Exhibits..................................................20









                                      - 2 -

<PAGE>





   CYCLO3PSS CORPORATION
   Condensed Consolidated Balance Sheets
   (UNAUDITED)
------------------------------------------------------------------------------




                                                     November 30,  February 28,
                                                         1999         1999
                                                    ------------- -------------
  Assets

   Current assets:

      Cash                                             $60,091       $36,018
      Accounts receivable                               90,950        47,578
      Inventories                                       53,530        65,348
      Prepaid expenses                                   3,000        45,128
                                                    ---------------------------
  Total current assets                                 207,571       194,072

  Property and equipment, net                          166,806       232,935

  Other assets:
      Acquired patents, net                             92,110       109,210
      Developed patents and other, net                  64,429        57,390
                                                    ---------------------------
                                                      $530,916      $593,607
                                                    ============= =============







                                      - 3 -

<PAGE>




   CYCLO3PSS CORPORATION
   Condensed Consolidated Balance Sheets (continued)
   (UNAUDITED)
 -----------------------------------------------------------------------------

<TABLE>
<CAPTION>
                                                               November 30,  February 28,
                                                                   1999          1999
                                                              ---------------------------
<S>                                                            <C>            <C>

   Liabilities and stockholders' equity

  Current liabilities:
      Accounts payable                                           $331,461     $239,140
      Accrued liabilities                                         203,696      149,033
      Accrued litigation settlement                               853,000          ---
      Current portion of capital lease obligations                  5,539        9,505
                                                              ---------------------------
  Total current liabilities                                     1,393,696      397,678

   Long-term portion of capital lease obligations                     --         3,778

  Commitments and contingencies

   Stockholders' equity:
    Preferred stock:
      Preferred stock issuable in series: par value $.01,
          4,500,000 authorized:
          Series "A" convertible preferred stock; 356,638
             shares authorized; 356,638 shares issued and
             outstanding                                             356          356
         Series "B" convertible preferred stock; 30,000
          shares authorized; 1,040 and 1,190 shares issued
             and outstanding at November 30, 1999 and
              February 28, 1999, respectively                         11           12
         Series "C" convertible preferred stock; 550 shares
           authorized; 250 and 206 shares issued and
           outstanding at November 30, 1999 and February 28,
            1999, respectively                                         3            2
      Class "A" preferred stock, par value $.01; 500,000
            shares authorized; none issued or outstanding            ---          ---
      Common stock, par value $.001; 55,000,000 shares
           authorized; 20,949,252 shares issued at November
          30,1999 and 17,599,482 shares issued at February
          28, 1999                                                20,949        17,599
      Additional paid-in capital                              18,046,184    17,860,958
      Accumulated deficit                                    (18,428,738)  (17,185,231)
      Less treasury stock, 264,000 common shares at cost        (501,545)     (501,545)
                                                              ---------------------------
      Total stockholders' equity                                  (9,778)      192,151
                                                              ---------------------------
                                                                $530,916      $593,607
                                                              ===========================

   See accompanying notes to condensed consolidated financial statements

</TABLE>




                                      - 4 -

<PAGE>



   CYCLO3PSS CORPORATION
   Condensed Consolidated Statements of Operations
   (UNAUDITED)
 -----------------------------------------------------------------------------


                                                    For the three months ended
                                                           November 30,
                                                        1999           1998
                                                  -------------- --------------

   Net revenues                                        $268,543        $70,589

   Costs and expenses:
      Cost of sales                                      97,573         83,254
      Research and development                               --          3,135
      Selling and marketing                                  --             --
      General and administrative                        382,739        556,104
      Depreciation and amortization                      27,981         94,648
                                                  -------------- --------------
                Total expenses                          508,293        737,141

  Loss from operations                                (239,750)      (666,552)
  Interest income                                            --            54
  Interest expense                                        (169)          (713)
                                                  -------------- --------------
  Net loss                                            (239,919)      (667,211)
   Preferred stock dividends                            (8,499)       (88,534)
                                                 -------------- --------------
   Net loss applicable to common stock               $(248,418)     $(755,745)
                                                 ============== ==============

   Basic and dilutive net loss per common share          $(.01)         $(.04)
                                                 -------------- --------------
    Weighted average number of common shares
     issued and outstanding                         19,325,599     18,025,784
                                                 ============== ==============

 ---------------------------------------------------------------------------
   See accompanying notes to condensed consolidated financial statements




                                      - 5 -

<PAGE>







   Condensed Consolidated Statements of Operations
  -----------------------------------------------------------------------------
   (UNAUDITED)





                                                    For the nine months ended
                                                           November 30,
                                                        1999           1998
                                                  -------------- --------------

   Net revenues                                        $754,478       $659,254

   Costs and expenses:
      Cost of sales                                     345,680        543,951
      Research and development                               --        209,673
      Selling and marketing                                  --        203,650
      General and administrative                        709,705      1,591,802
      Depreciation and amortization                      88,868        302,569
                                                  -------------- --------------
                Total expenses                        1,144,253      2,851,645

  Loss from operations                                (389,775)    (2,192,391)
   Litigation settlement expense                      (853,000)            --
  Interest income                                           15          3,983
  Interest expense                                        (747)        (3,213)
                                                  -------------- --------------
  Net loss                                          (1,243,507)    (2,191,621)
   Preferred stock dividends                           (25,497)      (116,450)
                                                 -------------- --------------
   Net loss applicable to common stock             $(1,269,004)   $(2,308,071)
                                                 ============== ==============

   Basic and dilutive net loss per common share          $(.07)         $(.14)
                                                 -------------- --------------
    Weighted average number of common shares
     issued and outstanding                         18,254,854     16,753,956
                                                 ============== ==============

   ---------------------------------------------------------------------------
   See accompanying notes to condensed consolidated financial statement


                                      - 6 -

<PAGE>






   CYCLO3PSS CORPORATION
   Condensed Consolidated Statements of Cash Flows
   (UNAUDITED)
-------------------------------------------------------------------------------


<TABLE>
<CAPTION>
                                                                   For the nine months ended
                                                                          November 30,
                                                                      1999            1998
                                                               --------------------------------
<S>                                                              <C>              <C>
  Cash flows from operating activities:
      Net loss                                                   $(1,243,507)     $(2,191,621)
      Adjustments to reconcile net loss to net cash
        used in operating activities:
     Depreciation and amortization                                    88,870          302,569
             Litigation settlement                                   853,000               --
             Shares issued to board in lieu of compensation           13,750               --
             Impairment of intangible assets                              --          273,951
             Changes in assets and liabilities:
       Decrease in accounts receivable                               (43,372)          64,749
       Increase in inventories                                        11,818           (1,504)
       Decrease in prepaid expense                                    42,128           34,569
       Decrease in accounts payable and accrued liabilities          146,982         (549,044)
                                                               --------------------------------
  Net cash used in operating activities                             (130,331)      (2,066,331)
                                                               --------------------------------

  Cash flows from investing activities:
      Purchase of property and equipment                                (802)         (41,445)
      Addition to developed patents and other                        (11,876)         (11,011)
                                                               --------------------------------
  Net cash used in investing activities                              (12,678)         (52,456)
                                                               --------------------------------

  Cash flows from financing activities:
      Proceeds from issuance of preferred and common stock           156,825        1,673,321
      Proceeds from issuance and exercise of stock options            18,000           11,800
      Principal payments under capital lease obligations              (7,743)         (17,692)
                                                               --------------------------------
  Net cash provided by financing activities                          167,082        1,667,429
                                                               --------------------------------
  Net increase (decrease) in cash                                     24,073         (451,358)

  Cash at beginning of period                                         36,018          573,161
                                                               --------------------------------
  Cash at end of period                                              $60,091         $121,803
                                                               ================================
</TABLE>








See accompanying notes to condensed consolidated financial statements.




                                             - 7 -

<PAGE>





   CYCLO3PSS CORPORATION
   Notes to Condensed Consolidated Financial Statements (Unaudited)
------------------------------------------------------------------------------


   1.  Summary of Significant Accounting Policies

   Financial Statements

   The accompanying interim consolidated financial statements have been prepared
   in accordance  with  generally  accepted  accounting  principles  for interim
   financial information and with the instructions to Form 10-QSB and Regulation
   S-B. The balance sheet at February 28, 1999 represents the Company's  audited
   consolidated balance sheet at that date.

   In  the  opinion  of  management,  the  accompanying  condensed  consolidated
   financial  statements contain all normal recurring  adjustments  necessary to
   present fairly the financial position of Cyclo3pss Corporation ("Company") as
   of November 30, 1999,  and the results of its  operations  and its cash flows
   for the interim  periods ended  November 30, 1999 and November 30, 1998.  The
   operating  results for the interim periods are not necessarily  indicative of
   the results for a full year.  These  financial  statements  should be read in
   conjunction with the Company's audited consolidated  financial statements and
   notes thereto included in the Company's Annual Report to Stockholders for the
   year ended February 28, 1999.

   Organization

   The  Corporation was formed in Delaware in 1927. In 1990, the Corporation was
   reorganized as Cyclo3pss  Medical Systems,  Inc. In 1995, the Company changed
   its name to Cyclo3pss Corporation. The Company is engaged in the manufacture,
   sale and  installation of ozone food processing  products,  ozone washing and
   laundry  sorting  and  counting  systems  for  commercial  and  institutional
   laundries, the manufacture and sale of specialty compounds and chemicals, and
   research  and   development  of   technologies   for   sterilization   and/or
   disinfection of surgical, medical and other instruments.

   Principles of Consolidation

   The consolidated financial statements include the accounts of the Company and
   its wholly-owned  subsidiaries.  All  intercompany  balances and transactions
   have been eliminated.

   Use of Estimates

   The preparation of financial statements in conformity with generally accepted
   accounting  principles  requires management to make estimates and assumptions
   that affect the reported  amounts of assets and liabilities and disclosure of
   contingent  liabilities  at the  date  of the  financial  statements  and the
   reported amounts of revenue and expenses during the reporting period.  Actual
   results could differ from those estimates.


                                    - 8 -

<PAGE>






   CYCLO3PSS CORPORATION
   Notes to Condensed Consolidated Financial Statements (Unaudited)
------------------------------------------------------------------------------

   1.  Summary of Significant Accounting Policies (continued)

   Loss per Common Share

   Loss per common  share is  calculated  after  deduction  of  preferred  stock
   dividends  divided by the weighted  average  number of shares of common stock
   issued and outstanding during the period. Loss per common share attributed to
   preferred stock dividends was not significant (less than one cent per share).
   The Company excluded  10,771,561 and 5,519,173  options and warrants from the
   weighted  average  shares  outstanding  computation  at November 30, 1999 and
   February 28, 1999, respectively as their effect would be anti dilutive.

   Comprehensive Income

   Statement  of Financial  Accounting  Standards  ("SFAS") No. 130,  "Reporting
   Comprehensive  Income",  requires  that all items that are  recognized  under
   accounting  standards as components of comprehensive  income be reported in a
   financial  statement  that is  displayed  with the same  prominence  as other
   financial  statements.  The  items of  other  comprehensive  income  that are
   typically  required to be  displayed  are  foreign  currency  items,  minimum
   pension  liability  adjustments,  and unrealized  gains and losses on certain
   investments in debt and equity securities.  There have been no items of other
   comprehensive income to date.

   2.  Basis of Presentation

   The accompanying  financial  statements have been prepared  assuming that the
   Company will continue as a going concern,  which contemplates the realization
   of assets and  satisfaction  of liabilities in the normal course of business.
   The Company has  sustained  significant  net losses which have resulted in an
   accumulated  deficit at November 30, 1999 of $18,428,738  and  $17,185,231 at
   February 28, 1999,  and periodic cash flow  difficulties,  all of which raise
   substantial doubt of the Company's ability to continue as a going concern.

   The net loss for the year ended  February  28,  1999 was  $3,232,857  and the
   Company  recorded net loss of $1,243,507  for the nine months ended  November
   30,  1999.  The  current  liabilities  are in  excess  of  current  assets by
   $1,186,125   and  $203,606  at  November  30,  1999  and  February  28,  1999
   respectively.  To date,  the  Company has funded its  operations  through the
   issuances of common and preferred stock.  The Company  anticipates a net loss
   for the year ended  February 28, 2000,  and with a cash balance of $60,091 at
   November  30, 1999 and  expected  cash  requirements  for the year,  there is
   substantial doubt as to the Company's ability to continue operations.

   The Company  believes that these  conditions  have resulted from the inherent
   risks associated with small technology companies. Such risks include, but are
   not limited to, the  ability to (a)  generate  sales of its product at levels
   sufficient to cover its costs and provide a return for investors, (b) attract
   additional  capital in order to  finance  growth,  (c)  further  develop  and
   successfully  market  commercial  products and (d) successfully  compete with
   other technology companies having financial, production




                                    - 9 -

<PAGE>




   CYCLO3PSS CORPORATION
   Notes to Condensed Consolidated Financial Statements (Unaudited)
------------------------------------------------------------------------------


   2.  Basis of Presentation (continued)

   and marketing resources  significantly greater than those of the Company. The
   Company  is  attempting  to  improve  these  conditions  by way of  financial
   assistance  through  collaborative   partnering   agreements,   issuances  of
   additional equity, debt arrangements,  and product sales. Management believes
   that  appropriate  funding will be generated  and future  product  sales will
   result from these opportunities and that the Company will continue operations
   through the next fiscal year;  however,  no assurance can be given that sales
   will be generated or that the additional necessary funding will be raised.

   3. Contingencies

   The Company recorded  $853,000 in August 1999 as legal settlement  expense in
   connection  with the settlement  agreement it reached with Mifal Klita et al.
   in September  of 1999.  During the period from May through  August 1996,  the
   Company sold its series B preferred stock in a private placement  offering to
   certain  investors  pursuant to the  provisions of Regulation S. One of these
   investors,  Mifal Klita, a purported Canadian company, filed suit against the
   Company demanding the removal of the restrictive  investment legend which the
   Company  caused  to be  placed  on  common  shares  issued  pursuant  to  the
   conversion of series B preferred  shares.  The suit was filed in the Court of
   Chancery  in the State of  Delaware,  which  ruled in favor of the Company on
   April 8, 1997 and dismissed  Mifal Klita's  suit.  Subsequently,  Mifal Klita
   refiled an amended suit in the Superior  Court of the State of Delaware.  The
   final settlement  agreement reached by the parties  involved,  entitled Mifal
   Klita to the  conversion of his series B preferred  shares into  unrestricted
   common stock of the Company plus additional  common shares for legal fees and
   other provisions stated in the original  agreement.  The unrestricted  common
   stock  will be  disbursed  monthly  over a two year  period.  Under a formula
   defined in the settlement, the remaining obligation under this settlement has
   been  reflected as a current  liability as resolution  and  settlement of the
   liability  may be  accelerated  according  to  the  terms  of the  settlement
   agreement.  The Company is not involved in any other legal actions and claims
   at this time.

   4. Segment Information

   During the nine months ended November 30, 1999 and 1998, the Company operated
   in four principal industries; the manufacture, sale and installation of ozone
   food processing products ("food safety products"); the manufacture,  sale and
   installation  of ozone washing and laundry  sorting and counting  systems for
   commercial and institutional laundries ("textile products");  the manufacture
   and sale of specialty chemicals ("biochemical products"), and the manufacture
   and sale of medical sterilizers ("medical products").

   Operating profit is total revenue less operating expenses, excluding interest
   expense and general corporate expenses. Corporate assets consist primarily of
   cash and cash equivalents, other receivables,  prepaid expenses, property and
   equipment and inventory.


                                    - 10 -

<PAGE>






   CYCLO3PSS CORPORATION
   Notes to Condensed Consolidated Financial Statements (Unaudited)
------------------------------------------------------------------------------

   4. Segment Information (continued)

                                                  For nine months ended
                                             Nov 30, 1999        Nov 30, 1998
                                           ------------------------------------

   Net revenues
      Food Safety products                     $139,050            $283,308
      Textile products                          190,522             173,910
      Medical products                          119,250                --
      Biochemical products                      305,656             202,036
                                           ------------------------------------
      Total Revenue                            $754,478            $659,254
                                           ====================================

   Operating income (loss)
      Food Safety products                     $ 47,536           $(120,561)
      Textile products                         (181,793)           (917,665)
         Medical products                       119,250                --
      Biochemical products                       71,075             (43,161)
                                           ------------------------------------
      Total operating income (loss)              56,068          (1,081,387)

      Corporate expenses                     (1,298,843)         (1,111,004)
      Interest income                                15               3,983
      Interest expense                             (747)             (3,213)
                                           ------------------------------------
      Net income (loss)                    $ (1,243,507)       $ (2,191,621)
                                           ====================================

   Identifiable assets
      Food Safety products                      $78,762            $34,344
      Textile products                          172,931            530,558
      Biochemical products                      107,334            151,008

      General corporate assets                  171,889            170,995
                                           ------------------------------------
      Totals assets                            $530,916          $ 886,905
                                           ====================================




                                    - 11 -

<PAGE>




                                 PART I - ITEM 2

                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                               OR PLAN OF OPERATION

   General

   Cyclopss  Corporation  is  primarily  engaged in the  design,  manufacturing,
   assembly,  sales  and  installation  of ozone  application  technologies  and
   processes.  The Company's  main product lines offer an alternative to address
   food  safety  concerns  and  laundry   disinfection  and  efficiency.   Ozone
   disinfectant technology is proven to reduce microbial counts on food products
   without the  potential for the  development  of immunity or resistance by the
   microbial  organism  and build up of chemicals  on the final  product.  Ozone
   laundry systems enable users to reduce costs  associated  with labor,  water,
   energy, chemical, textile replacement and wastewater.

   The  Company  also  markets an  automated  sorting  and  counting  system for
   commercial  laundries.  Other  non-ozone  based products offer by the Company
   include more than 350 specialty  chemicals and  compounds.  The Company holds
   patents for medical sterilization processes and has entered into a Technology
   Licensing Agreement with Consolidated Stills and Sterilizers of Boston, MA to
   license the ozone medical instrument  sterilization  technology developed and
   patented by the  Company for use in  Ster-O-Zone  100.  The terms  include an
   initial  licensing fee and ongoing  royalties  from  Consolidated  Stills and
   Sterilizers  once they have perfected the technology and are producing sales.
   . Results of Operations

   The Company's  revenues were $268,543 for the three months ended November 30,
   1999  compared to $70,589 for the three months ended  November 30, 1998.  The
   revenues were  $754,478 for the nine months ended  November 30, 1999 compared
   to  $659,254  for the  nine  months  ended  November  30,  1998.  Four of the
   Company's  wholly  owned  subsidiaries  contributed  to the  Company's  gross
   revenues,  Eco-Pure  Food  Safety  Systems,  Inc.  (EPFS),  Cyclopss  Laundry
   Systems,  Inc.  (CLS),  Cyclopss  Medical  Systems,  Inc.  (MED) and Cyclopss
   Biochemical  Corporation  (CBC).  The  Company's  gross  margin for the three
   months ended  November 30, 1999 was  $170,970  compared to $(12,665)  for the
   three  months ended  November 30, 1998.  The gross margin for the nine months
   ended November 30, 1999 was $408,798 compared to $115,303 for the nine months
   ended November 30, 1998. The Company has taken steps to control cost of sales
   by reducing employees,  production space, and any other unnecessary  expense.
   The Company  expects  revenue to increase in the  upcoming  quarters,  due to
   managements efforts to locate new customers. The Company also expects cost of
   sales to increase at a relative proportion to the revenue. If revenues do not
   increase,  the Company will not continue to operate unless  additional  funds
   are available from other sources.

   Research  and  development  expenses  decreased  to $0 for the three and nine
   months  ended  November  30, 1999 from $3,135 and  $209,673 for the three and
   nine months ended November 30, 1998, respectively. The Company eliminated all
   research and  development  costs  during the nine months  ended  November 30,
   1999, due to lack of necessary funds for this function.  The Company believes
   it is necessary and intends to resume its research and development efforts in
   the  current  year when funds are  available  or if it can  locate  strategic
   partners that are able to fund research and development efforts.


                                    - 12 -

<PAGE>







   Selling and marketing  expenses decreased to $0 for the three and nine months
   ended  November  30, 1999 from $0 and  $203,650 for the three and nine months
   ended November 30, 1998,  respectively.  The Company eliminated its marketing
   staff and eliminated all  advertising  in order to conserve  remaining  cash.
   Management  believes  that  it  is  critical  to  periodically   support  and
   supplement  its sales  efforts  through  advertising,  public  relations  and
   trade-show  participation when sufficient funds are available.  However,  the
   current cash constraints do not permit any sales and marketing activities.

   General and  administrative  expenses  decreased  to  $382,739  for the three
   months  ended  November  30, 1999 from  $556,104  for the three  months ended
   November 30, 1998,  due to a decrease in management  employment,  shareholder
   relations and legal fees.  General and  administrative  expenses decreased to
   $709,705 for the nine months ended November 30, 1999 from  $1,591,802 for the
   nine months ended  November 30,  1998.  Management  has taken steps to reduce
   these costs in order to help conserve the limited cash available.  Management
   will  continue to review and control  these costs,  but believes  general and
   administrative  expenses in the coming  quarters of fiscal 2000 will increase
   due to management  and human  resource  requirements  for the Company  should
   sales and other commercial activities increase,  and should more funds become
   available.

   Interest  expense  declined to $169 for the three months  ended  November 30,
   1999 compared with $713 for the three months ended  November 30, 1998, and it
   declined to $747 for the nine months ended  November 30, 1999  compared  with
   $3,213 for the nine months ended  November 30, 1998 due to the  conversion of
   all long-term debt to common stock and lower lease  payments.  The Company is
   not  in  a  financial  position  to  borrow  from  traditional   sources  and
   anticipates low interest expense in fiscal 2000. The Company has minimum debt
   and  intends to fund its  operations  through  non-interest  bearing  capital
   sources,  but there can be no  assurance  that such funding will be available
   and if it is not  available,  the Company will likely not be able to continue
   in operations.

   The Company  recorded  $853,000 in August  1999 as an  additional  expense on
   legal settlement in connection with the settlement  agreement it reached with
   Mifal Klita et al. in September  of 1999.  During the period from May through
   August  1996,  the  Company  sold its series B  preferred  stock in a private
   placement  offering  to  certain  investors  pursuant  to the  provisions  of
   Regulation  S. One of these  investors,  Mifal  Klita,  a purported  Canadian
   company,  filed  suit  against  the  Company  demanding  the  removal  of the
   restrictive investment legend which the Company caused to be placed on common
   shares issued  pursuant to the conversion of series B preferred  shares.  The
   suit was filed in the Court of Chancery in the State of Delaware, which ruled
   in favor of the Company on April 8, 1997 and  dismissed  Mifal  Klita's suit.
   Subsequently,  Mifal Klita  refiled an amended suit in the Superior  Court of
   the State of Delaware.  The final settlement agreement reached by the parties
   involved,  entitled  Mifal Klita to the  conversion of his series B preferred
   shares into  unrestricted  common  stock of the Company plus shares for legal
   fees and other provisions stated in the original agreement.  The unrestricted
   common stock will be disbursed monthly over a two year period.  The remaining
   amounts due under the  settlement  agreement  have been  reflected in accrued
   liabilities.

   The Company recorded net loss applicable to common stock for the three months
   ended November 30, 1998 of $248,418 compared to $755,745 for the three months
   ended  November 30, 1998.  Net loss  applicable  to common stock for the nine
   months ended November 30, 1998 of $1,269,004




                                    - 13 -

<PAGE>




   compared to $2,358,071  for the nine months ended November 30, 1998. In order
   to help  conserve  cash,  the  Company  has taken  steps to control  costs by
   reducing  employees and management,  and eliminating  sales and marketing and
   reducing   promotional  and  investor   relation   activities.   The  Company
   anticipates  that it will operate at a loss for the year ending  February 28,
   2000.  However,  if  revenues  of  CLS,  EFS,  MED and  CBC  increase,  it is
   anticipated that losses will begin to diminish.

   The Company believes that all four of its divisions, namely Eco-Pure Food
   Safety Systems, Inc., Cyclopss Laundry Systems, Inc., Cyclopss Medical
   Systems, Inc. and Cyclopss Biochemical, Inc. will contribute to the Company's
   future revenue stream.


   Liquidity and Capital Resources

   As of the date of this filing,  the Company has insufficient funds on hand to
   continue its operations for the entire fiscal year ending  February 28, 2000,
   unless  significantly  increased  revenues and gross  profits are achieved or
   additional  financing  is  obtained.  Should the Company be  unsuccessful  in
   achieving the increased  level of revenues and gross profits  required to pay
   its operating expenses or in acquiring additional equity financing to pay the
   shortfall,  the Company will seek direction from the Board of Directors as to
   what action must be taken,  or what  action  should be taken to preserve  the
   Company's  limited assets.  Management is aggressively  exploring  additional
   financing for the ongoing operations of the Company.  There are no assurances
   that  the  efforts  to  locate  and  secure  additional   financing  will  be
   successful,  and the failure to secure  this  financing  would  substantially
   alter management's  assumptions as presented  heretofore and in the remainder
   of this section.

   Cash used in  operating  activities  was  $130,331  for the nine months ended
   November 30, 1999 compared to $2,066,331  for the nine months ended  November
   30, 1998. The Company has  significantly  reduced its cash use rate in fiscal
   2000, due to the necessity of having to conserve available cash.

   Cash expenditures for property and equipment and patents were $12,678 for the
   nine months ended  November 30, 1999  compared to $52,456 for the nine months
   ended  November 30, 1998.  This  decrease is also the result of the Company's
   attempt to help conserve cash and reduce expenses.

   Net cash provided by financing  activities for the nine months ended November
   30, 1999 was $167,082,  due mainly to issuance of 157 shares of preferred "C"
   shares,  as described  further in this  section.  Cash  provided by financing
   activities for the nine months ended November 30, 1998 was $1,667,429, due to
   the  issuance  of  1,296,140  shares of common  stock in a private  placement
   offering  through  First  Financial  Investment   Securities,   which  raised
   $1,620,175 ($1,395,004 in net proceeds).

   Total assets  decreased  to $530,916  for the nine months ended  November 30,
   1999 from $593,607 for the year ended February 28, 1999, due to a decrease in
   prepaid  expenses,  normal  amortization of intangibles  and  depreciation of
   fixed  assets.  This  reduction  was offset by a slight  increase in cash and
   accounts receivable from increased sales.

   Total current  liabilities  increased to $1,393,696 at November 30, 1999 from
   $397,678 at February 28, 1999,  mainly due to an increase in accounts payable
   and recording of $853,000 as accrued


                                    - 14 -

<PAGE>






   litigation  settlement,  as  explained  previously  at the end of "results of
   operations".  Long term liabilities decreased to $0 for the nine months ended
   November  30, 1999 from $3,778 for the year ended  February  28,  1999.  This
   decrease  was due to the  repayment  of  certain  lease  liabilities  and the
   reclassification of the remaining lease obligations to current obligations.

   During  the  period  of  September  28,  1998 to April 15,  1999 the  Company
   authorized  and  offered  its  Series  "C"  preferred  shares  to  accredited
   investors in an offering  made  pursuant to  Regulation  S of the  Securities
   Exchange Act, and a Board Resolution on September 10, 1998. By the end of the
   offering,  seven  subscribers  purchased  such shares in this  offering for a
   total of $362,825 that were accepted under the subscription  plan. Series "C"
   preferred  shares are  convertible  to common  shares at $.10 (ten cents) per
   share.


   Year 2000 or Y2K Issue

   The Year 2000 or Y2K issue  refers to some  computer  systems'  inability  to
   recognize the date field as the year 2000. As a result of these shortcomings,
   there was a concern that some computers might be unable to process  year-date
   data accurately beyond the year 1999.

   Additionally,  if the  Company's  suppliers,  customers,  and  other  parties
   experienced Y2K difficulties,  the Company could be adversely  affected.  The
   Company is continuing the process of assessing and correcting  potential Year
   2000 problems with the Company's  operations.  The Company did not experience
   any Y2K related  problems as all  remediation  and  corrective  actions  were
   successful.

   With  regard  to  potential  Y2K  issues  for the  Company's  major  material
   suppliers,  the Company is in the process of communicating with such parties.
   Although not all major  suppliers have indicated  their Y2K  compliance,  the
   Company has not yet identified issues with any major supplier. Generally, the
   Company  has  alternative  sources  for  supplies  in the  event  a  supplier
   experiences  such  difficulties  and  the  Company  has not  experienced  any
   difficulties in obtaining materials due to suppliers' Y2K problems.

   With regard to major customers,  the Company has had communications with such
   parties and is reviewing responses regarding the Companies Y2K compliance. To
   date, the Company has not identified any Y2K matters with customers.

   The  Company  will  continue  to  evaluate  its system and will  continue  to
   communicate  with customers and suppliers but anticipates no Y2K matters will
   arouse since none have been reported to date.

   Plan of Operation

   The  Company's  Plan of  Operation is to rely solely on the  availability  of
   additional  capital  to fund  ongoing  operations,  of which  there can be no
   assurance.  The Company as of the date this filing has  insufficient  capital
   for long term operations.  However,  the Company has entered into a Letter of
   Intent with The Procter & Gamble Company of Cincinnati, Ohio, (see Subsequent
   Events below)




                                    - 15 -

<PAGE>




   which has  provided  short term  working  capital and should the  transaction
   contemplated within that Letter of Intent be fully executed, the Company will
   be provided an  opportunity  to engage its new business model of operation as
   described below. However, should this transaction not be executed the Company
   will have no other option but to move forward in filing a petition to provide
   a safe harbor to protect the assets of the Company.

   The Company  historically has acted as both the developer of its technologies
   and then as the  manufacturer  and  marketer  of those  technologies.  It has
   become apparent that the customers  within the markets pursued by the Company
   are intrigued by the performance and potential of the products.  However, the
   size and operating capabilities of the Company doesn't support the confidence
   required  for the  Company's  targeted  customers to become  purchasers.  The
   Company's targeted  industrial  customer base is accustomed to doing business
   with vendors and suppliers of a size and stability  that  reasonably  assures
   business  continuity and internal  product  support.  The single exception to
   this  discrimination  as to our  limited  size  has  been the U S Navy who is
   mandated to provide business  opportunity for small business enterprises such
   as Cyclopss.

   Under the Company's  new plan of operations it will no longer  attempt to act
   as a manufacturer or marketer of its  technologies  but will instead act as a
   technology  provider.  Its efforts  will be directed  toward the  creation of
   technology  bridges between companies already providing products and services
   to those industries which will utilize the Company's  technology  products to
   produce new complete  processes.  These  ventures  will include  suppliers of
   equipment and appliances  and suppliers of disposable or consumable  products
   modified to utilize the Company's  proprietary  technologies  under licensing
   and  royalty  agreements.  The end result will  create  interlocking  process
   systems that will be both  effective and economic.  Additionally  the process
   systems will be sold and serviced by vendors and suppliers  already  accepted
   by the target markets.  This model provides the manufacturers with technology
   and new product offerings and provides the Company with a royalty revenue and
   commercialization of its technologies through already existing manufacturing,
   sales and service infrastructures.

   The Company will  continue to provide low volume  production of ozone systems
   to customers  like the US Navy,  and the Company also  anticipates it will be
   compensated  by one or more  of the  industry  participants  for  design  and
   development work required in modifying their existing products to accommodate
   the  incorporation  of the  Company's  proprietary  technologies.  This model
   allows  the  Company  to keep the number of  employees  limited  to  specific
   requirements of the technology  application,  and converts the Company into a
   technology purveyor.

   This  business  model is  illustrated  by the current  business  relationship
   between the Company,  P&G and Otres,  Inc. Cyclopss had established a working
   relationship  with P&G early in 1999. In May of 1999 it was approached by the
   principals of Otres who engaged the Company to assist in the  development and
   validation of a toothbrush sanitizer and a kitchen sponge sanitizer utilizing
   ozone.  The  management of the Company  determined  the products  could be of
   great interest to P&G and, after having appropriate confidentiality documents
   executed, Otres agreed to allow the Company to introduce the product concepts
   to P&G. P&G  determined  they had products  that would lend  themselves  to a
   co-marketing  relationship  with the Otres  appliances as long as the product
   development was responsibly  executed and the technology  application  proved
   safe and  effective.  Both  Otres  and P&G  engaged  the  Company  for  these
   activities.  This resulted in the Company receiving revenues of approximately
   $98,000 from both venture  partners  for the  development  and testing of the
   appliances.  The Company  manages the  relationship  with P&G for Otres under
   contract,


                                    - 16 -

<PAGE>


   and contributed to the execution of co-marketing agreements between Otres and
   CREST(R) for the toothbrush sanitizer, and Otres and DAWN(R) for dish washing
   soap that will be  announced  at the  International  Home  Appliance  Show in
   Chicago,  on January 16, 2000. The Company negotiated for and will receive an
   ongoing  royalty of 3% from the sale of the  appliances  which  provides  the
   potential for significant future revenues with minimal related costs of sale.

   Should the Company  receive the proceeds from the financing  contemplated  in
   the P&G Letter of Intent, it anticipates  moving the Research and Development
   activities  to New Mexico.  The Company has already  arranged the  assistance
   available to them from the New Mexico Department of Economic  Development for
   the  relocation.  This  enhances  and  supports  the Company  emergence  as a
   respected   technology   purveyor.   The  Company  will  maintain  a  limited
   administrative  staff in its current offices in Salt Lake City, Utah, as well
   as the Biochem division which continues to increase its revenues.

   This plan, if successfully  executed,  provides  ongoing  operating  revenues
   derived from contract development,  with the potential of significant license
   and  royalty   revenues   generated   by  the  success  of  its  partners  in
   commercializing the processes.

   The Company has recently entered into a very similar contract development and
   licensing  arrangement with Consolidated Stills and Sterilizers of Boston, MA
   on  its  proprietary  Ozone  Gas  Medical   Sterilization   Technology,   and
   anticipates shipping the prototype in early February 2000.

   The Company  anticipates its revenues as well as the source of those revenues
   to change significantly through these relationships. However, there can be no
   assurance  that a  successful  financing  can be completed as a result of the
   Letter  of  Intent  or that  the new  Otres  products  even  assisted  by the
   marketing strengths of P&G will gain significant market acceptance to provide
   significant revenues.

   The Company has demonstrated the Eco Wash system for the US Navy in San Diego
   at the Public Works Center.  The system was able to launder  industrial  wipe
   rags  achieving  higher  absorbency  than  produced with  convention  laundry
   formulas.  This result was achieved  while  reducing hot water costs by 100%,
   water  consumption by 51%, sewer costs by 100%,  chemical costs by 77%, labor
   by 29%, and  electricity  cost by 11%.  These  savings  resulted in a payback
   period  of  10.7  months.  From  the  successful  demonstration,   the  Naval
   Facilities  Engineering  Service  Center is  recommending  that the other PWC
   sites convert their operations to the Eco Wash system (potentially a total of
   50 systems).  Since this demonstration,  several new sites have been visited.
   Each site will  average two Eco Wash 60 Laundry  Systems,  including a washer
   and  dryer,  at  approximately  $75,000  each.  At  this  time  there  are no
   additional Eco Wash systems under  contract and there are no assurances  that
   additional contracts are forthcoming.

   In late 1997 the electrical Power Research Institute (EPRI) declared ozone as
   Generally  Regarded as Safe (GRAS)  allowing food  processors to use ozone in
   the processing of certain food items.  Quoting from a September 2, 1999 ozone
   industry  solicitation  on  behalf  of  EPRI:  "Recently,  FDA  discovered  a
   troublesome  ruling in their 1982 bottled water regulation that accorded GRAS
   status to ozone use in  bottled  water.  The 1982  bottled  water  ruling was
   issued  inappropriately  under 184.1(b) (2),  which  indicated that all other
   food uses  require  regulation.  Therefore,  although  FDA has elected not to
   challenge  the EPRI  Expert  Panel  declaration,  the FDA  cannot  officially
   sanction




                                    - 17 -

<PAGE>




   GRAS  status  for the use of ozone in food  processing  because  of the prior
   184.1(b)  (2) ruling.  To help  resolve  this  dilemma,  EPRI is preparing to
   petition the FDA for approval of ozone under the food  additive  regulations.
   In view of the  significant  food  safety  protection  provided by the use of
   ozone, FDA has agreed to receive this petition under the new Expedited Review
   rules,  which appears to be the best way to resolve the  regulatory  problem.
   This  discovery  and its  resolution  can  adversely  affect future sales and
   contracts for Eco Pure and others in the ozone industry.

   The Company has been aggressively  seeking  customers and strategic  partners
   who are sufficiently  convinced of the potential to pro-actively  participate
   in necessary  research and development  costs.  These customers and strategic
   partners not only may provide  revenues  from possible R&D contracts but also
   follow-on royalty revenues from the purchase of systems and processes.

   The Company has provided major agricultural producers with prototype ECO-PURE
   test  systems  that have been  installed  in wet produce  processing  plants,
   long-term produce storage  facilities,  short term banana and tomato ripening
   rooms, and for use in treatment of herbal remedies and dietary supplements.

   The Company continues to pursue strategic partners who are willing to advance
   resources  and expenses in contract R&D  relationships  that not only provide
   revenues and working  capital for the Company but, if  successful,  create on
   going royalty revenues.

   Even with  sufficient  funds  available,  the  ongoing  challenge  facing the
   Company is that of educating its potential partners, government, industry and
   the end consumer about the benefits of ozone. Ozone is a  naturally-occurring
   phenomenon that is usually  associated with  photochemical smog or an eroding
   level of protection in our atmosphere.  It is the Company's intent to provide
   this education and show the beneficial  side of ozone-  decontamination.  For
   industry, ozone is a cost competitive and environmentally-friendly  answer to
   microbial contaminates.  For the consumer, ozone kills harmful microorganisms
   quickly and leaves behind no chemical residue.

   The Biochem  products  will  continue to be driven by customer  requests  and
   increased sales will be derived from contract  product  development.  Current
   sales  activities  will be evaluated and  alternatives  looked for to improve
   profit  margins.  Joint efforts will continue  with Foster  Miller,  Inc., in
   efforts to create a market for Biochem's monomer to the aerospace industry.

   Given the Company's  generally  illiquid  cash position and limited  capital,
   there  can be no  assurances  that the  Company  will be able to  effectively
   execute its plan of operations.

   The Company  had eleven  full time and one part time  employee as of November
   30, 1999. The Company  anticipates  no additional  employees will be required
   during the next twelve months.

   The information  set forth herein as to anticipated  research and development
   costs,  equipment  purchases and increase in employees are management's  best
   estimates  based upon current plans.  Actual  expenditures  may be greater or
   less than such estimates depending on many factors including, but not limited
   to the availability of new technologies, the completion or lack of completion
   of certain strategic alliances,  and the timing and successful  completion of
   the Company's stated requirement to acquire  additional  operating and growth
   capital,  industry  initiatives,   success  of  the  Company's  research  and
   development efforts, and other factors.



                                    - 18 -

<PAGE>






   From  time to  time,  the  Company  may  publish  forward-looking  statements
   relating  to such  matters as  anticipated  financial  performance,  business
   prospects, technological developments, new products, research and development
   activities and similar matters. The private Securities  litigation Reform Act
   of 1995 provides a safe harbor for forward  looking  statements.  In order to
   comply with the terms of the safe harbor, the Company notes that a variety of
   factors could cause the  Company's  actual  results and  experience to differ
   materially from the anticipated  results or other  expectations  expressed in
   the Company's forward looking  statements.  The risks and uncertainties  that
   may  affect  the  operations,  performance,  development  and  results of the
   Company's business include, but are not limited to, the following:

   1.  Market acceptance of the Company's products;
   2. Obtaining  sufficient  additional operating capital in the form of debt or
   equity; 3. The existence of an orderly market in the Company's securities; 4.
   Increased sales of the various products of the Company;  5. Continued success
   in the  Company's  research and  development  activities;  and 6.  Successful
   completion of strategic alliances.


   Subsequent Events

   The Company had been operating under a non binding  investigational Letter of
   Intent with The Procter & Gamble  Company of  Cincinnati,  Ohio,  executed on
   June 3, 1999.  The content and context of that document  regarded and was the
   result of a technical due diligence  initiated by P&G in late December  1998.
   The  relationship  was not  disclosed  prior to this filing due to  stringent
   confidentiality requirements.

   Under the  confidentiality  of this relationship and while  investigating the
   technologies and products of the Company,  P&G was  subsequently  introduced,
   with the  consent of its client  Otres,  to the  proprietary  products  being
   developed  under  contract  by the  Company  for its  client  Otres.  Initial
   interest was expressed by P&G  prompting  Otres and the Company to enter into
   an additional  contract that called for the Cyclopss Management to administer
   the  relationship  between  the  parties.  The result  affected  co-marketing
   agreements  for Otres  with both the Crest  and Dawn  divisions  of P&G.  The
   contract  also  provides for an on going  royalty  payment to Cyclopss on the
   gross sales of the  appliances,  and a First Right of Refusal for Cyclopss to
   contract all future product  development under the same royalty  arrangement.
   This working  model  prompted the business  model as described in the Plan of
   Operations above.

   The severe financial condition of the Company was disclosed to P&G during the
   last week November 1999.  Procter & Gamble  responded  immediately  and after
   conferring with the Company's Management  negotiated and subsequently entered
   into a new Letter of Intent on December 10, 1999.  The  agreement  allows for
   two separate  finances by P&G to the Company.  The first,  a small  Unsecured
   Promissory  Note,  was executed and funded in concert with the signing of The
   Letter  of  Intent  in order to  relieve  the  immediate  and  critical  cash
   requirements  of  the  Company.  The  second  contemplated   financing  is  a
   Convertible Secured Loan which will provide long term working capital for the
   Company. Should the Company successfully meet the pre loan conditions of this
   transaction,  and P&G elect to move forward in its execution, it is currently
   scheduled to be concluded in the first




                                    - 19 -

<PAGE>




   quarter  of  calendar  2000.  The loan will be  secured  by a first  security
   interest in all of the Company's Intellectual  Properties and will be due and
   payable  in full on the  one  year  anniversary  date of its  execution.  The
   Company  contemplates  engaging in several  diverse  development  and testing
   contracts within various departments of P&G.

   The Agreement grants a conversion right to P&G allowing for the conversion of
   all or any  part  of the  outstanding  loan,  including  all or any  part  of
   interest due into shares in the  Company's  common shares of stock at anytime
   during the term of the loan, and at the sole discretion of Procter & Gamble.

   In  addition,  under  the  terms of the  agreement,  P&G will be  granted  an
   Exclusive  First  Right of Refusal for the  Licensing  of all the current and
   future technologies of the Company.

   THERE ARE NUMEROUS AND RIGOROUS CONDITIONS THAT MUST BE MET BY THE COMPANY TO
   THE  SOLE  AND  COMPLETE  SATISFACTION  OF  PROCTER  &  GAMBLE  PRIOR  TO THE
   SUCCESSFUL   CONCLUSION  OF  THE  FINANCING   AND   SUBSEQUENT   CONTEMPLATED
   RELATIONSHIP. THE LETTER OF INTENT IS NON-BINDING AND THERE CAN NO ASSURANCES
   THAT THERE WILL BE ANY ADDITIONAL  CONTRACTUAL BUSINESS  RELATIONSHIP BETWEEN
   THE PARTIES OTHER THAN THE SMALL WORKING CAPITAL LOAN DISCLOSED ABOVE.


    PART II - OTHER INFORMATION

      Item 1. Legal Proceedings..  A settlement agreement was reached with Mifal
      Klita et al. in  September  of 1999.  During the period  from May  through
      August 1996,  the Company  sold its series B preferred  stock in a private
      placement  offering to certain  investors  pursuant to the  provisions  of
      Regulation S. One of these  investors,  Mifal Klita, a purported  Canadian
      company,  filed suit  against  the  Company  demanding  the removal of the
      restrictive  investment  legend  which the Company  caused to be placed on
      common  shares  issued  pursuant to the  conversion  of series B preferred
      shares.  The suit was  filed in the  Court  of  Chancery  in the  State of
      Delaware,  which  ruled  in  favor of the  Company  on  April 8,  1997 and
      dismissed Mifal Klita's suit. Subsequently, Mifal Klita refiled an amended
      suit in the Superior Court of the State of Delaware.  The final settlement
      agreement  reached by the parties  involved,  entitled  Mifal Klita to the
      conversion of his series B preferred shares into unrestricted common stock
      of the Company plus shares for legal fees and other  provisions  stated in
      the original  agreement.  The unrestricted  common stock will be disbursed
      monthly over a two year period.

      Item 2.     Changes in Securities.  None.

      Item 3.     Defaults Upon Senior SecuritieNone.

      Item 4.     Submission of Matters to a Vote of Security HoldNone.

      Item 5.     Other Information.

      Item 6.     Exhibits and Reports on Form 8-K andNone.



                                    - 20 -

<PAGE>



                                   SIGNATURES

      In accordance  with the  requirements  of the  Securities  Exchange Act of
   1934,  as  amended,  the  Registrant  caused  this report to be signed on its
   behalf by the undersigned, thereunto duly authorized.


                                          CYCLO3PSS CORPORATION


   Date: January 14, 2000                 By/s/ William R. Stoddard
                                          -----------------------
                                          William R. Stoddard
                                          Chief Executive Officer
                                          Principal Executive Officer



   Date: January 14, 2000                 By/s/ Mondis Nkoy
                                          ----------------------------------
                                          Mondis Nkoy
                                          Controller, Corporate Secretary
                                          Principal Financial Officer





                                    - 21 -