QUARTERLY REPORT FOR SMALL BUSINESS ISSUERS
                 SUBJECT TO THE 1934 ACT REPORTING REQUIREMENTS

                                   FORM 10-QSB

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

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

                  For the quarterly period ended June 30, 2000

                                       OR

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

                       Commission File Number: 001-14005

                            FRISBY TECHNOLOGIES, INC.
             (Exact Name of Registrant as Specified in its Charter)

                  Delaware                           62-1411534
        (State or other Jurisdiction of           (I.R.S. Employer
       Incorporation or Organization)           Identification Number)

                             3195 Centre Park Blvd.
                             Winston-Salem, NC 27107
              (Address of Principal Executive Offices and Zip Code)
                                  336-784-7754
              (Registrant's telephone number, including area code)



Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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  ________

Number of shares  outstanding of the issuer's Common Stock,  par value $.001 per
share, as of July 31, 2000: 6,575,588 shares.

<PAGE>


                            FRISBY TECHNOLOGIES, INC.


                                      INDEX
<TABLE>
<CAPTION>

                                                                                            PAGE NO.

Part I            Financial Information

Item 1.           Financial Statements

<S>                                                                                           <C>
                  Balance Sheets - June 30, 2000 (unaudited) and
                  December 31, 1999                                                           3

                  Statements of Operations - Three Month and Six Month Periods Ended
                  June 30, 2000 (unaudited) and June 30, 1999
                  (unaudited)                                                                 4

                  Statement of Stockholders' Equity - Six Month Period
                  Ended June 30, 2000 (unaudited)                                             5

                  Statements of Cash Flows - Six Month Period Ended
                  June 30, 2000 (unaudited) and June 30, 1999 (unaudited)                     6

                  Notes to Financial Statements - June 30, 2000 (unaudited)                   7

Item 2.           Management's Discussion and Analysis of Financial Condition
                  and Results of Operations                                                   8

Part II           Other Information                                                          12

                  Signatures                                                                 14
</TABLE>
<PAGE>


                         PART I - FINANCIAL INFORMATION
                          Item 1. Financial Statements
<TABLE>
<CAPTION>

                            Frisby Technologies, Inc.
                                 Balance Sheets
                                                                            June 30, 2000  December 31, 1999
                                                                            -------------  -----------------
                                                                              (unaudited)
Assets
<S>                                                                         <C>             <C>
Current assets:
     Cash and cash equivalents                                              $  3,099,698    $  1,171,579
     Accounts receivable, less allowance for doubtful accounts                 1,055,757       1,849,436
     Inventory                                                                 2,141,916       1,097,049
     Prepaid and other current assets                                            476,614         559,820
                                                                            ------------    ------------
Total current assets                                                           6,773,985       4,677,884
Property and equipment, net                                                      874,799         604,921
Intangible assets, less accumulated amortization                               2,727,273       2,838,603
Other assets                                                                      76,093         298,439
                                                                            ------------    ------------
Total assets                                                                $ 10,452,150    $  8,419,847
                                                                            ============    ============

Liabilities and stockholders' equity
Current liabilities:
     Accounts payable                                                       $  1,230,675    $  1,622,280
     Note payable - short term                                                 1,388,900         549,981
     Accrued expenses and other current liabilities                              381,400         239,999
     License fees payable                                                        205,135         282,565
     Deferred license revenues                                                      --            26,254
                                                                            ------------    ------------
Total current liabilities                                                      3,206,110       2,721,079
Accrued license agreement costs                                                  105,750         120,250
Other liability                                                                1,300,000       1,300,000
                                                                            ------------    ------------
Total liabilities                                                              4,611,860       4,141,329
Minority interest                                                                138,430            --
Commitments and contingencies
Stockholders' equity:
     Common Stock, $.001 par value; 10,000,000 shares authorized;
       6,575,588 and 5,775,413 shares issued and outstanding, respectively         6,576           5,748
     Additional paid-in capital                                               18,760,851      14,888,201
     Accumulated deficit                                                     (13,065,567)    (10,615,431)
                                                                            ------------    ------------
Total stockholders' equity                                                     5,701,860       4,278,518
                                                                            ------------    ------------
Total liabilities and stockholders' equity                                  $ 10,452,150    $  8,419,847
                                                                            ============    ============




<FN>
 See accompanying notes.
</FN>
</TABLE>
<PAGE>


                            Frisby Technologies, Inc.
                            Statements of Operations
                                   (Unaudited)
<TABLE>

                                                 Three month period ended      Six month period ended
                                                         June 30,                       June 30,
                                                         --------                       --------

                                                    2000           1999           2000           1999
                                                    ----           ----           ----           ----


Revenues:
<S>                                             <C>            <C>            <C>            <C>
    Product sales                               $ 2,719,207    $ 1,668,526    $ 5,125,187    $ 2,498,946
    Research and development projects                42,967         44,875         63,967        146,250
    Licenses and royalties                          100,845        162,249        137,095        257,280
                                                -----------    -----------    -----------    -----------
Total revenues                                    2,863,019      1,875,650      5,326,249      2,902,476

Cost of sales:
    Product sales                                 2,125,893      1,272,039      4,014,163      1,929,240
    Research and development projects                18,000         86,907         18,000        168,842
    Licenses and  royalties                         118,685        130,800        203,485        237,257
                                                -----------    -----------    -----------    -----------
Total cost of sales                               2,262,578      1,489,746      4,235,648      2,335,339
                                                -----------    -----------    -----------    -----------
Gross profit                                        600,441        385,904      1,090,601        567,137
Selling and marketing expense                     1,020,988        748,185      1,887,700      1,496,185
General and administrative expense                  619,490        976,184      1,605,250      1,892,140
                                                -----------    -----------    -----------    -----------
Loss from operations                             (1,040,037)    (1,338,465)    (2,402,349)    (2,821,187)
Interest (expense)/ income                          (43,192)        57,336        (59,688)       132,565
Minority Interest                                    11,901           --          (34,373)          --
Provision for income taxes                             --             --             --             --
                                                -----------    -----------    -----------    -----------
Net loss                                        $(1,117,602)   $(1,281,129)   $(2,450,136)   $(2,688,622)
                                                ===========    ===========    ===========    ===========

Net loss per common share - basic and diluted   $      (.17)   $     (.22)   $      (.40)   $      (.50)
                                                ===========    ===========    ===========    ===========
<FN>

See accompanying notes.
</FN>
</TABLE>
<PAGE>


                            Frisby Technologies, Inc.
                        Statement of Stockholders' Equity
                      Six Month Period Ended June 30, 2000
                                   (Unaudited)


<TABLE>

                                                               Additional      Accumu-
                                        Common Stock            Paid-In        lated
                                    Shares          Amount      Capital        Deficit          Total
                                    ------          ------      -------        -------          -----

Balance at
<S>                               <C>         <C>            <C>            <C>             <C>
December 31, 1999                 5,748,113   $      5,748   $ 14,888,201   $(10,615,431)   $  4,278,518


Net loss                               --             --             --       (2,450,136)     (2,450,136)

Exercise of employee
stock options                        27,475             28        119,001           --           119,029

Sale of common stock and
warrants, net of $245,551 of
related costs and expenses          800,000            800      3,753,649           --         3,754,449
                               ------------   ------------   ------------   -----------     ------------

Balance at
June 30, 2000                     6,575,588   $      6,576   $ 18,760,851   $(13,065,567)   $  5,701,860
                               ============   ============   ============   ============    ============
<FN>

See accompanying notes.
</FN>
</TABLE>


<PAGE>
                            Frisby Technologies, Inc.
                            Statements of Cash Flows
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                            Six month period ended
                                                                                    June 30,
                                                                 -------------------------------------------
                                                                              2000            1999
                                                                              ----            ----
Operating activities
<S>                                                                       <C>            <C>
Net loss                                                                  $(2,450,136)   $(2,688,622)
Adjustments to reconcile net loss to net cash used in operating
    activities:
     Depreciation and amortization                                            105,958         84,937
     Non cash consulting expense                                                 --           70,000
     Amortization of intangibles                                              160,194        102,600
     Changes in assets and liabilities, prior to effect of acquisition:
          Accounts receivable                                                 793,679       (595,159)
          Inventory                                                        (1,044,867)       (91,714)
          Other current assets                                                 83,206        246,565
          Other non-current assets                                            222,346         99,522
          Accounts payable                                                   (391,605)       139,961
          Accrued expenses and other current liabilities                      141,401       (230,892)
          Licenses fees payable                                               (91,930)        67,957
          Other liabilities                                                   112,176        (17,498)
                                                                          -----------    -----------
Net cash used in operating activities                                      (2,359,578)    (2,812,343)
                                                                          -----------    -----------

Investing activities
Purchases of property and equipment                                          (375,836)      (375,550)
Investment in joint venture                                                   (48,864)      (400,000)
Purchase of business, net of cash acquired                                       --         (103,864)
                                                                          -----------    -----------
Net cash used in investing activities                                        (424,700)      (879,414)
                                                                          -----------    -----------

Financing activities
Repayment of line of credit                                                  (549,981)          --
Proceeds from exercise of stock options                                       119,029           --
Net proceeds from private placement                                         3,754,449           --
Net proceeds from advances on line of credit                                1,388,900           --
                                                                          -----------    -----------
Net cash provided by financing activities                                   4,712,397           --
                                                                          -----------    -----------

Net increase(decrease) in cash and cash equivalents                         1,928,119     (3,691,757)
Cash and cash equivalents - beginning of period                             1,171,579      6,516,138
                                                                          -----------    -----------
Cash and cash equivalents -end of period                                  $ 3,099,698    $ 2,824,381
                                                                          ===========    ===========
Supplemental Information:
Interest paid                                                             $    59,688           --

<FN>
See accompanying notes
</FN>
</TABLE>
<PAGE>


                            Frisby Technologies, Inc.
                          Notes to Financial Statements
                            June 30, 2000 (Unaudited)

1. Basis of Presentation

     The  accompanying  unaudited  financial  statements  have been  prepared in
conformity  with  generally  accepted  accounting  principles  and  reflect  all
adjustments  consisting of normal recurring adjustments which, in the opinion of
management, are necessary for a fair presentation of the results for the periods
shown. The results of operations for such periods are not necessarily indicative
of the results  expected for the full fiscal year or for any future period.  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  assets and  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 and assumptions.

     The accompanying  financial  statements  should be read in conjunction with
the audited financial  statements of Frisby  Technologies,  Inc. (the "Company")
for the year ended  December  31, 1999 and the notes  thereto  contained  in the
Company's  Annual Report on Form 10-KSB,  filed with the Securities and Exchange
Commission on April 14, 2000, as amended.

2. Summary of Significant Accounting Policies

Net Loss Per Share

     Net loss per share for the three and six month  periods ended June 30, 2000
and 1999 are based on the weighted  average number of common shares  outstanding
during the period in  accordance  with the  Statement  of  Financial  Accounting
Standard ("SFAS") No. 128 "Earnings Per Share."

     Shares used in the  computation of net loss per share for the three and six
month  periods ended June 30, 2000 were  6,051,044  and 5,902,754  respectively.
Shares used in the computation of net loss per share for the three and six month
periods  ended June 30, 1999 were  5,708,113  and  5,414,363  respectively.  The
number of shares  used in the  calculation  of net loss per share on a basic and
diluted  basis is the  same.  The  calculation  of  diluted  net loss per  share
excludes  shares of common stock issuable upon the exercise of stock options and
warrants,   as  the   effect   of  such   exercises   would   be   antidilutive.

Reclassifications

     Certain amounts in prior periods have been reclassified to conform with the
current period presentation.


3. Shareholders' Equity

     On  May  31,  2000  the  Company   completed  a  private  placement  equity
transaction  with an  investor  group for $4 million  and is  curretnly  seeking
additional financing. This transaction was a unit (the "Unit") consisting of one
share of Frisby  common stock on the Nasdaq  SmallCap  Market and one  five-year
warrant to buy a share of common stock at an exercise  price of $7.00 per share.
The purchase price of this offering was $5.00 per Unit.

4. Joint Venture

     During the first quarter of 2000, the Company established  Schoeller Frisby
Technologies,  GmbH,  a joint  venture  with  Schoeller  Textil AG to expand the
European  distribution  of the Company's  products.  The Company owns 51% of the
outstanding  shares of the common stock of the joint  venture and,  accordingly,
consolidates  the joint venture.  The joint venture began  operations in January
2000.

     The Company recorded minority interest expense,  which reflects the portion
of the earnings of Schoeller  Frisby  Technologies  GmbH that are  applicable to
Schoeller  Textil AG's minority  interest.  The minority  interest amount on the
balance  sheet  represents  the  share of the net  assets  of  Schoeller  Frisby
Technologies  GmbH  associated  with the  minority  partner's  interest in those
operations.



ITEM 2. MANAGEMENT'S  DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS
OF OPERATIONS.


Results of  Operations  for the three and six month  periods ended June 30, 2000
compared with the three and six month periods ended June 30, 1999

     Revenues.  The Company  generates  revenue from four primary  sources:  (i)
sales of its Thermasorb(R),  ComforTemp(R)DCC(TM)  insulating and cooling foams,
fabrics, leathers and gels, and Schoeller-ComforTemp(R) foam/fabric products for
use in its strategic  partners'  products;  (ii) sales of SteeleVest and Extreme
Comfort  end use  products  (iii)  license  fees and  royalties  from the use of
Thermasorb(R)  and  ComforTemp(R)  trademarks by strategic  partners in end-user
products,  as well as other fees earned in connection  with its agreements  with
strategic  partners;  and (iv) revenue from research and  development  contracts
related  to the United  States  Government  and from  private  companies.  Total
revenues  for the three  months  ended June 30,  2000  increased  by $987,369 to
$2,863,019  from  $1,875,650  for the three months  ended June 30,  1999.  Total
revenues for the six month period ended June 30, 2000 increased by $2,423,773 to
$5,326,249 from $2,902,476 for the six month period ended June 30, 1999.

     The majority of this second  quarter  increase  was  generated by increased
product sales of $1,050,681 to $2,719,207  from  $1,668,526 for the three months
ended June 30, 1999.  For the six month period ended June 30, 2000 product sales
increased by $2,626,241 to $5,125,187  from  $2,498,946 for the six month period
ended June 30, 1999.  These  product  sales  increases  reflect the inclusion of
Schoeller Frisby Technologies GmbH sales,  primarily in Europe, of approximately
$1,100,000 and $2,100,000 for the three and six month periods,  respectively, as
well as increased  sales to existing and new  customers in the United States and
Asia.

     Cost of sales.  The  Company's  cost of sales  consists  of: (i) direct and
indirect costs incurred in connection with product sales;  (ii) royalty payments
required to be made in  accordance  with the  technology  licensing  agreements;
(iii) the amortization expense associated with the transaction with the inventor
to lower the  royalty  rates and (iv)  direct and  indirect  costs  incurred  in
connection with revenue from research and development  contracts.  Total cost of
sales  for the three  months  ended  June 30,  2000  increased  by  $772,832  to
$2,262,578 from $1,489,746 for the three months ended June 30, 1999. Total costs
for the six  month  period  ended  June 30,  2000  increased  by  $1,900,309  to
$4,235,648 from $2,335,339 for the six month period ended June 30, 1999.

The majority of this second quarter  increase was generated by increased cost of
product sales of $853,854 to  $2,125,893  from  $1,272,039  for the three months
ended June 30,  1999.  The cost of product  sales for the six month period ended
June 30, 2000 increased by $2,084,923 to $4,014,163  from $1,929,240 for the six
month period  ended June 30, 1999.  These  increases  correspond  to the product
sales  increase  above.

     Selling and marketing expense. Selling and marketing expenses for the three
months ended June 30, 2000 increased by $272,803 to $1,020,988 from $748,185 for
the three months  ended June 30,  1999.  For the six month period ended June 30,
2000 selling and marketing  expenses  increased by $391,515 to  $1,887,700  from
$1,496,185 for the six month period ended June 30, 1999.  This increase  results
from the Company's  increased  marketing and advertising  activity,  both in the
United  States  and  Europe,  in order to build  brand name  recognition  of its
ComforTemp(R) products and trademarks. These activities included the advertising
placements and tradeshow  participation.  The expense of the European activities
were borne by Schoeller Frisby Technologies GmbH.

     General and administrative expense. General and administrative expenses for
the three  months  ended June 30, 2000  decreased  by $356,694 to $619,490  from
$976,184 for the three months  ended June 30,  1999.  Additionally,  for the six
month  period  ended June 30,  2000 these  expenses  decreased  by  $286,890  to
$1,605,250  compared to $1,892,140 for the six month period ended June 30, 1999.
These decreases primarily reflect management's  cost-cutting  initiatives in the
non-sales related functions.

     Minority interest.  Minority interest represents  Schoeller Textil AG's 49%
interest in the net loss of Schoeller Frisby Technologies GmbH.

     Interest  expense/income.  Interest  expense  for the three and six  months
ended June 30, 2000 arises from the advances  made against the line of credit in
the first and second  quarter  of 2000.  The  interest  income in the prior year
reflects the higher cash and  investment  balances,  due to receipts of proceeds
from the Initial Public Offering ("IPO") in April 1998.

     Net loss. As a result of the  foregoing,  the net loss for the three months
ended June 30, 2000 decreased to $1,117,602 from $1,281,129 for the three months
ended June 30, 1999.  Additionally,  the net loss for the six month period ended
June 30, 2000  decreased by $238,486 to $2,450,136  from  $2,688,622 for the six
month period ended June 30, 1999.

Liquidity and Capital Resources

     From its  inception  through  June  30,  2000,  the  Company  has  incurred
cumulative  losses of  approximately  $13,100,000.  The Company has financed its
operations to date through research and development contracts relating to United
States  government  programs,  bank  borrowings and issuance of common stock and
convertible preferred stock.

     At June 30, 2000, the Company had working  capital of $3,568,000  including
cash  of  $3,100,000   accounts   receivable  of  $1,056,000  and  inventory  of
$2,142,000, offset by accounts payable of $1,231,000, note payable short-term of
$1,389,000 and accrued expenses and other current liabilities of $381,000.

     Cash used by operating activities was $2,360,000 and $2,812,000 for the six
months  ended  June 30,  2000  and  1999,  respectively.  The  principal  factor
contributing  to the cash used in operating  activities for the six months ended
June 30, 2000 and 1999 was the net loss for each of the respective periods. Cash
used by investing  activities was $424,700 and $879,000 for the six months ended
June 30, 2000 and 1999, respectively.  The principal investing activity for 2000
was the purchase of office and testing equipment for the new  headquarters.  The
principal investing activities for 1999 were the purchase of fixed assets and an
installment payment on the purchase of intellectual  property of $400,000.  Cash
provided by financing  activities  was  $4,712,000 for the six months ended June
30, 2000. The principal  financing  activities for the six months ended June 30,
2000 were the net  advance  on the line of credit of  $839,000  and the  private
placement of $3,754,000.

     The  Company  has  incurred  cumulative  losses  since its  inception  and,
therefore,  has not been subject to significant  federal  income taxes.  Through
June 30, 2000,  the Company has generated net operating  loss  carryforwards  in
excess of $13,000,000  that may be available to reduce future taxable income and
future tax liabilities.  These  carryforwards  expire in years through 2019. The
Tax  Reform  Act of 1986  provides  for an annual  limitation  on the use of net
operating loss  carryforwards  (following  certain ownership changes) that could
significantly limit the Company's ability to utilize these  carryforwards.  As a
result  of  the  IPO,  the  Company's  ability  to  utilize  the  aforementioned
carryforwards  as  of  the  IPO  date  will  be  limited  on  an  annual  basis.
Additionally,  because the United  States tax laws limit the time  during  which
these  carryforwards may be applied against future taxes, the Company may not be
able to take full advantage of these attributes for federal tax purposes.

     On  May  31,  2000  the  Company   completed  a  private  placement  equity
transaction  with an  investor  group for $4 million  and is  currently  seeking
additional financing.

     The  Company  has a  $2,000,000  Line of Credit  with a bank  that  expires
September 30, 2000.  This line is  principally  maintained  for working  capital
purposes.  The Line is a committed  facility,  which is secured by substantially
all of the Company's  assets,  and bears  interest at the bank's prime rate plus
200 basis  points.  At June 30,  2000,  the entire  credit  facility  was either
borrowed  against or used as collateral for  outstanding  Letters of Credit with
suppliers.  On August 14,  2000,  the  Company  received a letter  from the bank
indicating  that it will extend the existing line of credit facility to December
31,  2000 on  essentially  the same terms and  conditions  as  described  in the
Company's most recent 10-KSB filing.  The Company expects to be able to obtain a
credit facility of this type in fiscal 2001,  although no assurance can be given
that the Company will be able to obtain such facility.

     The Company established Schoeller Frisby Technologies GmbH, a joint venture
with Schoeller  Textil AG to expand the European  distribution  of the Company's
products.  The Company believes that the initial equity and debt contribution to
this joint  venture  will not exceed $1  million.  As of August  14,  2000,  the
Company has funded approximately  $200,000 of initial capital  contributions and
organizational costs.

     Based on the Company's  current  operating plan, the Company  believes that
the cash  available as a result of the  committed  portion of the Line of Credit
and other  equity  financing  activity  mentioned  above will be  sufficient  to
satisfy its operational  and capital  requirements  through  December 2000. Such
belief is based upon certain  assumptions,  and there can be no  assurance  that
such assumptions are correct.  In the event that the Company's plans change,  or
its available  cash,  cash flow from operations and available line of credit are
insufficient to fund operations due to unanticipated delays, problems,  expenses
or otherwise,  the Company would be required to seek additional financing sooner
than anticipated.  Further, depending on the Company's progress in marketing its
product line, gaining  acceptance of its thermal  management  technology and its
other products and services among the business  community or the  identification
of strategic acquisition or licensing  opportunities,  the Company may determine
that it is advisable to raise additional capital sooner than was anticipated.

Inflation

     The  impact  of  general  inflation  on the  Company's  business  has  been
insignificant  to date and the  Company  believes  that it will  continue  to be
insignificant for the foreseeable future.

Foreign Currency

     The functional  currency of the Schoeller Frisby  Technologies  GmbH is the
Swiss Franc.



Forward-Looking Statements

     Certain  information  contained  in this  Quarterly  Report on Form 10-QSB,
including,  without  limitation,  information  appearing  under  Part I, Item 2,
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations," are  forward-looking  statements (within the meaning of Section 27A
of the Securities Act of 1933 and Section 21E of the Securities  Exchange Act of
1934).  Factors set forth in the Company's Prospectus filed April 1, 1998, or in
the Company's other Securities and Exchange Commission filings, could affect the
Company's  actual results and could cause the Company's actual results to differ
materially from those expressed in any forward-looking statements made by, or on
behalf of, the Company in this Quarterly Report on Form 10-QSB.

     Those statements are subject to numerous risks and uncertainties that could
cause actual  results,  performance and  achievements to differ  materially from
those  described  or implied in the  forward-looking  statements,  and  reported
results  should not be considered an  indication  of future  performance.  Those
potential risks and uncertainties  include without limitation the uncertainty of
the economic  environment  for the remainder of this year,  the need for further
development  of  certain  of Frisby  Technologies'  products  and  markets,  the
development of  alternative  technologies  or legal  challenges to the Company's
existing  technologies by third parties and the uncertainty of market acceptance
and demand for the company's products in the future.

PART II-OTHER INFORMATION

Item 1.  Legal Proceedings

     The Company is  presently  involved in a legal  dispute  pertaining  to its
exclusive  worldwide  license  rights  for  attaching  its foam to fabric  under
agreements with Outlast Technologies. Frisby filed an arbitration claim on April
25, 2000.  The Company  believes that the matter will be resolved in arbitration
in accordance with the terms of the license agreement. The Company remains fully
confident its position will prevail and no adverse reaction from the arbitration
will effect the Company.  Attendant to this  arbitration is a subsequent  patent
infringement  complaint filed in U.S. Federal Court by Outlast that likewise the
Company  believes  has no  merit in fact and  will  not  materially  impact  the
Company's near or mid term performance.

Item 2.  Changes in Securities and Use of Proceeds

     On  May  31,  2000  the  Company   completed  a  private  placement  equity
transaction  with an  investor  group for $4 million  and is  currently  seeking
additional financing. This transaction was a unit (the "Unit") consisting of one
share of Frisby  common stock on the Nasdaq  SmallCap  Market and one  five-year
warrant to buy a share of common stock at an exercise  price of $7.00 per share.
The purchase price of this offering was $5.00 per Unit.


Item 3.  Defaults upon Senior Securities

None.

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

None

Item 5.  Other Information

See the Form 8-K, dated April 25, 2000, regarding the establishment of Schoeller
Frisby Technologies GmbH.

See the Form  8-K,  dated  June  15,  2000,  regarding  the $4  million  private
placement equity transaction.

Item 6.  Exhibits and Reports on Form 8-K

     (a) Exhibits

          27.1 Financial Data Schedule

          (b) Reports on Form 8-K

               The  Company  filed  a  report  on Form  8-K on  April  25,  2000
               regarding  the  establishment  of Schoeller  Frisby  Technologies
               GmbH.


               The Company filed a report on Form 8-K on June 15, 2000 regarding
               the $4 million private placement equity transaction.



<PAGE>


                                   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.

         Dated:  August 14, 2000

                                            FRISBY TECHNOLOGIES, INC.



                                                By: /s/ Gregory S. Frisby
                                                   ----------------------
                                                     Gregory S. Frisby
                                                     Chief Executive Officer



                                                By:  /s/ Stephen P. Villa
                                                     --------------------
                                                     Stephen P. Villa
                                                     Chief Financial Officer