SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549


                                   FORM 10-QSB

               Quarterly Report Pursuant to Section 13 or 15(d) of
                       The Securities Exchange Act of 1934

               For the quarterly period ended: September 30, 1998

                        Commission File number: 0-114244

                                 WATCHOUT! INC.

             (Exact name of registrant as specified in its charter)

                     formerly WHITE CLOUD EXPLORATION, INC.

Utah                                        84-0959153
---------------------------------           -----------------
State or Other Jurisdiction                 (I.R.S. Employer
of incorporation or organization)           Identification
Number)

116 Stanyan, San Francisco, California        94118
---------------------------------------     ---------
(Address of principal Executive Offices     Zip Code)

Registrant's telephone number, including area code: 415-387-3135

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 the  filing
requirements for at least the past 90 days.

                                 Yes  X       No   ____

As of September 30, 1998,  there were  15,030,245  outstanding  shares of common
stock, par value $.0001.

<PAGE>
<TABLE>
<CAPTION>


PART 1.           FINANCIAL INFORMATION

         ITEM 1.           Financial Statements

                                        WHITE CLOUD EXPLORATION, INC.
                                             BALANCE SHEET
                                          AS OF SEPTEMBER 30,
                                              (UNAUDITED)

<S>                                                <C>               <C> 
                                                       1998              1997
ASSETS
Current Assets
Cash                                                    1,891          176,700
Accounts Receivable                                    29,144          422,743
Escrow - Boit                                          56,250
Less Allow for Doubtful Accts
Inventory                                             162,000           176,186
Total Current Assets                                  249,285           775,630

Fixed Assets
Property, Plant & Equipment                            40,859            33,156
Less accumulated Depreciation                          11,753             9,901
Total Fixed Assets                                     29,106            23,255

Total Assets                                          278,391           798,885


LIABILITIES & STOCKHOLDERS' EQUITY

Current Liabilities
Accrued Expenses                                      448,714           280,310
Accounts Payable                                      379,318           317,110
Interest Payable                                       23,005
Due to Stockholders                                   512,196           319,146
Due to Member                                                            15,000
Line of Credit
Notes Payable                                         450,000           532,273
Total Current Liabilities                           1,813,232         1,463,838

Stockholders' Equity (Deficit)
Preferred Stock, no par value 10,000,000 shares authorized
 no shares issued or outstanding.
Common Stock, $0.001 par value, 50,000,000 shares
authorized
 15,030,245 & 227,000 shares issued and outstand       15,030            15,030
Additional Paid in Capital                            989,502           989,002
Accumulated Deficit                                (2,539,373)       (1,668,985)

Total Stockholders' Deficit                        (1,534,841)         (664,953)

Total Liabilities & Stockholders' Deficit             278,391           798,885

</TABLE>

<PAGE>

                                          WHITE CLOUD EXPLORATION, INC.
                                             STATEMENT OF OPERATIONS
                                        For the nine months ended September 30,
                                                   (UNAUDITED)
<TABLE>
<CAPTION>

                                                    1998              1997
<S>                                                    <C>               <C>
OPERATING REVENUES
Revenues                                               132,959           434,593
Cost of goods sold                                     141,929           259,391

Gross profit                                            (8,970)          175,202

OPERATING EXPENSES
Royalties                                               56,250           168,750
Research & Development                                  48,048           172,893
Selling Expenses                                         1,250            30,173
Professional Fees                                       51,797            98,822
General & Administrative                               198,950           228,606
Bad Debt Expense                                       125,399

Total operating expenses                               481,695           699,244

OPERATING PROFIT (LOSS)                               (490,665)         (524,042)

OTHER (REVENUES) &
EXPENSES
Interest expense                                         5,899            57,492
Miscellaneous income                                       (16)
Loss on sale of receivables                            (13,129)

Total other revenues & expenses                         (7,245)           57,492

NET INCOME (LOSS)                                     (483,420)         (581,534)

LOSS PER SHARE
Primary                                                  (0.03)            (0.04)

Weighted number of shares outstanding               15,030,245        15,030,245

</TABLE>

<PAGE>

                                           WHITE CLOUD EXPLORATION, INC.
                                              STATEMENT OF CASH FLOWS
                                         Three months ended September 30,
                                                    (UNAUDITED)
<TABLE>
<CAPTION>


<S>                                                    <C>             <C> 
                                                       1998            1997
OPERATING ACTIVITIES
Net Income (Loss)                                     (372,856)       (495,179)
Adjustments to reconcile net loss
 to net cash used in operating activities
Depreciation & Amortization                               (198)          5,557
Common stock issued in exchange for services

Changes in operating assets and liabilities
(Increase) Decrease in Accounts Receivable              29,884         (75,473)
(Increase) Decrease in Inventory                                      (142,913)
Increase (Decrease) in Accounts Payable                280,710          25,284
Increase (Decrease) in Interest Payable

Net cash used in operating activities                  310,396        (187,545)

INVESTING ACTIVITIES
(Purchase)Sale of Equipment                                197         (10,920)


Net cash provided by investing activities                  197         (10,920)

FINANCING ACTIVITIES
Advances (payments) from/to Stockholder                138,947         127,355
Proceeds (payments) from/to factor
Proceeds (payments) from/to line of credit              (8,850)
Proceeds (payments) from/to notes payable                              432,273
Proceeds (payments) from/to Member                     (67,159)         15,000
Proceeds from issuance of stock
Capital contributions                                                  250,000

Net cash provided by financing activities               62,938         824,628

Net increase (decrease) in cash and cash
 equivalents                                               675         130,984
Cash and cash equivalents at beginning of period         1,216          45,716

Cash and cash equivalents at end of period               1,891         176,700

</TABLE>


<PAGE>

                                          WHITE CLOUD EXPLORATION, INC.
                                             STATEMENT OF OPERATIONS
                                        For the three months ended September 30,
                                                   (UNAUDITED)
<TABLE>
<CAPTION>

<S>                                                 <C>               <C> 
                                                    1998              1997
OPERATING REVENUES
Revenues                                           (40,189)            2,151
Cost of goods sold                                  53,898           184,797

Gross profit                                       (94,087)         (182,646)

OPERATING EXPENSES
Royalties                                               -            168,750
Research & Development                              48,048           137,989
Selling Expenses                                    (2,024)          (54,761)
Professional Fees                                   47,110            75,352
General & Administrative                           101,830           213,614
Bad Debt Expense                                   125,399

Total operating expenses                           320,363           540,944

OPERATING PROFIT (LOSS)                           (414,450)         (723,590)

OTHER (REVENUES) &
EXPENSES
Interest expense                                     4,281           12,278
Miscellaneous income                                   (16)
Loss on sale of receivables

Total other revenues & expenses                      4,265           12,278

NET INCOME (LOSS)                                 (418,715)        (735,868)

LOSS PER SHARE
Primary                                              (0.03)           (0.05)

Weighted number of shares outstanding           15,030,245       15,030,245

</TABLE>

<PAGE>


                                          WHITE CLOUD EXPLORATION, INC.
                                             STATEMENT OF OPERATIONS
                                        For the nine months ended September 30,
                                                   (UNAUDITED)

<TABLE>
<CAPTION>

<S>                                                 <C>               <C> 
                                                    1998              1997
OPERATING REVENUES
Revenues                                           132,959           434,593
Cost of goods sold                                 141,929           259,391

Gross profit                                        (8,970)          175,202

OPERATING EXPENSES
Royalties                                           56,250           168,750
Research & Development                              48,048           172,893
Selling Expenses                                     1,250            30,173
Professional Fees                                   51,797            98,822
General & Administrative                           198,950           228,606
Bad Debt Expense                                   125,399

Total operating expenses                           481,695           699,244

OPERATING PROFIT (LOSS)                           (490,665)         (524,042)

OTHER (REVENUES) &
EXPENSES
Interest expense                                     5,899            57,492
Miscellaneous income                                   (16)
Loss on sale of receivables                        (13,129)

Total other revenues & expenses                     (7,245)           57,492

NET INCOME (LOSS)                                 (483,420)         (581,534)

LOSS PER SHARE
Primary                                              (0.03)            (0.04)

Weighted number of shares outstanding           15,030,245        15,030,245

</TABLE>


<PAGE>

                                          WHITE CLOUD EXPLORATION, INC.
                                        STATEMENT OF STOCKHOLDER'S EQUITY
                                             SEPTEMBER 30, 1998
<TABLE>
<CAPTION>
                                                 (UNAUDITED)

                             COMMON STOCK      ADDITIONAL      ACCUMULATED        TOTAL
                                               PAID-IN CAPITAL DEFICIT           STOCKHOLDER'S
<S>                            <C>      <C>      <C>    <C>              <C>               <C>
                                                                                  EQUITY
                               Shares   Amount          Amount           Amount            Amount
Balance at December 31, 1994     56,710          57       75,975         (102,487)          (26,455)
Issuance of common stock for    156,000         156       77,844                             78,000)

Net loss for year ended Dec 31, 1995                                      (89,906)          (89,906)

Balance at December 31, 1995    212,710         213      153,819         (192,393)          (38,361)
Issuance of common stock for     14,362          14      342,986                            343,000

Capital contribution                                     250,000                            250,000

Net loss for year ended Dec 31, 1996                                     (895,058)         (895,058)

Balance at December 31, 1996    227,072         227      746,805       (1,087,451)         (340,419)
Issuance of common stock for cash

Capital contribution                                     250,000                            250,000

Issuance of common stock for services
& repayment of debt to relate    43,290           43       7,457                              7,500

Issuance of common stock
in conjunction with merger   14,759,883        14,760    (14,760)

Net loss for year ended dec 31, 1997                                     (968,502)         (968,502)

Balance at December 31, 1997 15,030,245        15,030    989,502       (2,055,953)       (1,051,421)

Net loss for nine months ended                                           (483,420)         (483,420)
     September 30, 1998

Balance at September 30, 1998                                          (2,539,373)       (1,534,841)

</TABLE>


<PAGE>

WHITE CLOUD EXPLORATION, INC.
WHITE CLOUD EXPLORATION, INC.
NOTES TO FINANCIAL STATEMENTS

1. Organization and Summary of Significant Accounting Policies:

Organization-  White Cloud  Exploration,  Inc. (the Company) was incorporated in
the State of Utah on July 22, 1983, for the purpose of obtaining capital to seek
potentially profitable business opportunities.  Since inception, the Company has
been engaged in  organizational  activities.  The Company acquired two entities,
WatchOut,  a California  Corporation,  and  Goldpoint  International,  a limited
liability company. White Cloud Exploration,  Inc. changed its year-end from June
30 to December 31.

The Watchout Agreement was entered into effective May 30, 1997, and the Watchout
Acquisition  consummated  pursuant  thereto  effective  as of December 29, 1997.
Pursuant to the Watchout Agreement,  the shareholders of Watchout contributed to
the company all of  Watchout's  common stock for an aggregate  consideration  of
11,296,300  shares of the company  common  stock.  The company  owns 100% of the
issued and  outstanding  shares of Watchout.  Watchout  designs,  develops,  and
intends  to  market  worldwide   watches  and  other  consumer  goods  utilizing
proprietary colored liquid crystal display technology.

The  Goldpoint  Agreement  entered  into  contemporaneously  with  the  Watchout
Agreement and the Goldpoint Acquisition was completed contemporaneously with the
consummation of the Watchout  acquisition.  Pursuant to the Goldpoint Agreement,
the members of Goldpoint  contributed to the company an aggregate of 100% of the
equity interests in Goldpoint for an aggregate consideration of 2,140,000 shares
of the company's  common stock.  As a result of the Goldpoint  Acquisition,  the
company  owns  100%  of  the  outstanding  membership  interests  in  Goldpoint.
Goldpoint designs and markets fine writing instruments.

2. General and Summary of Significant Accounting Policies

Organization-Watchout,   a  California  corporation,   is  a  development  stage
enterprise  engaged in the  development  of fashion  watches.  Watchout plans to
develop, manufacture and sell watches and personal accessories worldwide.

Goldpoint International,  LLC, A Delaware limited liability company, designs and
markets fine writing instruments.

Property and Equipment- Property and equipment are stated at cost.  Depreciation
is computed using the  double-declining  balance  method over  estimated  useful
lives of 5 years.


Other Assets- Other assets consists of organizational costs and trademarks which
have been capitalized and are being amortized over 5 and 40 years, respectively,
using the straight-line method.

<PAGE>


WHITE CLOUD EXPLORATION, INC.
NOTES TO FINANCIAL STATEMENTS


Research and  Development-  Research  and  development  costs are expenses  when
incurred.

Income Taxes- No provision  have been made for income taxes.  As of December 31,
1997, the company had net operating loss (NOL)  carryforwards for federal income
tax purposes of approximately $2,055,900. These net-operating losses may be used
to offset future taxable income. Unused carryforwards will expire in 2012.

Uses 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  assets and  liabilities  at the date of the financial
statements  and the reported  activities  during the  reporting  period.  Actual
results may differ from those estimates.

3. Related Party Transactions

Watchout   has   recorded   unsecured,   non-interest-bearing   amounts  due  to
stockholders for the reimbursement of expenses.  There are no specific repayment
terms; however,  these amounts are expected to be repaid within 12 months of the
balance sheet date.

Watchout has also recorded $70,000 in amounts due to  stockholders.  The amounts
are  payable  on  demand  at an  interest  rate of  5.81%.  A  shareholder,  WCM
Investments, Inc., had a consulting agreement in which 1,150,000 shares of White
Cloud Exploration were issued in 1997.

4. Changes in Control

Effective  December  29,  1997  White  Cloud  Exploration  acquired  100% of the
outstanding common stock of Watchout and 100% of the limited liability interests
in Goldpoint International,  LLC in exchange for 11,296,300 and 2,140,000 shares
of White Cloud Exploration restricted common stock.

5. Commitments and Contingencies

License  Agreement-  On  September  21,  1995  Watchout  entered  into a license
agreement  with an  unrelated  third party for the use of patents and  technical
knowledge.  The agreement provides for minimum payments for the first four years
through September 1999, totaling $915,000, which may be offset by the payment of
royalties as a percentage  of sales.  The agreement may be canceled at any time,
without cause, by Watchout,  with 60 days notice and with no further  liability.
In addition to expense reimbursements of $20,000,minimum  payments in the amount
of $225,000 and $296,250 have been made for 1997 and 1996, respectively, and are
reported as royalties in the accompanying Statement of Operations.

WHITE CLOUD EXPLORATION, INC.
NOTES TO FINANCIAL STATEMENTS

<PAGE>

Investment  by   Distribution-   Watchout  entered  into  an  agreement  with  a
distributor on July 21, 1996. The agreement provides that the distributor invest
$500,000 -  $250,000  as a cash  payment to  Watchout  and  $250,000  to be made
available  to  Watchout  for  use in Hong  Kong,  oversees  production,  quality
assurance/quality  control and establish a $150,000 standby letter of credit. In
exchange, Watchout will issue the distributor 4% of the common stock outstanding
as of the date of the  agreement,  grant  distribution  rights in Southeast Asia
(except  Japan),  pay 9%  commission  based on the  factory  store  costs of the
product,  and grant the right to open Watchout retail stores in all of Southeast
Asia.  The agreement  will remain in effect for a minimum of four years or until
the distributor's investment of $500,000 is earned through commissions.

Consulting  Agreement- On November 15, 1996,  Watchout entered into an agreement
which requires  payment of $150,00 in finder's fees to be made to an independent
consultant,  plus 2% of the amount accepted under a placement  agreement but not
to exceed $250,000. In addition,  the consultant earned compensation  consisting
of 1,150,000 shares of White Cloud Exploration, Inc.

Placement  Agreement-  On February 5, 1997,  Watchout  entered into an agreement
with a placement agent to secure additional  capital or financing in the minimum
amount of $6,000,000.  The agreement requires Watchout to pay commissions to the
placement agent equal to 10% of the additional capital or financing received and
a  non-accountable  expense  allowance equal to 3% of the additional  capital or
financing.  In addition,  Watchout is partially responsible for certain expenses
incurred by the placement agent upon closing.  In 1996,  commitment fees paid to
the placement  agent  amounted to $20,000.  No fees were paid in 1997 under this
agreement.

As a condition of the agreement, the placement agent reserved the right of first
refusal to  underwrite  or place any future  public or private  sales of debt or
equity   securities  of  Watchout,   including  those  involving  any  principal
stockholders of the Watchout through November 19, 1999.

Watchout  has also agreed to pay the  placement  agent a 5% finder's  fee in the
event that they are party to any merger, acquisition or joint venture introduced
directly or indirectly by the placement agent.

In  connection  with the  placement  agreement,  the Board of  Directors  issued
3,639,925 shares of common stock to the placement agent for $500. The shares may
be repurchased  on a pro rata basis if $6,000,000 is not raised  pursuant to the
terms of the aforementioned agreement.

<PAGE>

WHITE CLOUD EXPLORATION, INC.
NOTES TO FINANCIAL STATEMENTS

Stock Warrants- In connection with the loan agreements dated September 19, 1997,
Watchout  agreed to pay finder's fees to a third party.  The agreement  requires
payment of finder's  fees in the form of $32,500 at the closing of the loans and
250,000  stock  warrants  with an  exercise  price of $.10 a share  expiring  on
December  19,  2000.  Payment of the  finder's  fees had not been made as of the
balance  sheet date,  however,  the $32,500 fee has been accrued at December 31,
1997. The warrants are to be issued when and if the private placement  described
previously under Placement Agreement is consummated.

In connection with the loans arranged for by Sands Brothers & Co., Ltd.  ("Sands
Brothers"),  White  Cloud  Exploration  has agreed to issue  stock  warrants  to
Raymond J. Larkin,  Watchout-Goldpoint  Partners,  L.P., Sands Brothers and Mark
Hollo totaling 75,000, 225,000,  25,000 and 25,000 shares respectively,  with an
exercise price of $.01 a share, expiring on September 3, 2000.

6. Line of Credit

A  promissory  note to  Goldpoint  International,  LLC of $54,968  payable  with
interest  60 days  from the date of each cash  advance  under a letter of credit
issued by Opal  Trade  Corporation.  Interest  accrues  at a rate of 4% over the
prime rate  designated  by Chemical  Bank.  This note is  collateralized  by the
assets of the company.

7. Loan Payable

( a ) Two 18%  promissory  notes of $150,000 and $50,000 due  September 3, 1998.
These notes are considered Senior and have priority in right of payment over all
indebtedness of the company.

( b ) A 12% promissory note of $166,000  payable to John Bader in one payment of
principal  and  interest  due on  demand  or at the time of first  funding  of a
private  placement of stock in the amount of  $6,000,000  by Watchout.  All sums
past due  shall  bear  interest  at 18% from  their  maturity  date.  Collateral
security includes the first $1.32 per unit production  proceeds upon the sale of
certain products.

( c ) A 12% promissory  note of $84,000 payable to Wayne Williams in one payment
of principal  and  interest  due on demand or at the time of first  funding of a
private  placement of stock in the amount of  $6,000,000  by Watchout.  All sums
past due  shall  bear  interest  at 18% from  their  maturity  date.  Collateral
security includes  priority  assignment of contract rights to the next $0.68 per
unit in production proceeds,  second only to the $1.32 per unit assigned to John
Bader from proceeds from certain products.

<PAGE>


WHITE CLOUD EXPLORATION, INC.
NOTES TO FINANCIAL STATEMENTS

8. Going Concern

The  accompanying  financial  statements  have been prepared in conformity  with
generally accepted accounting principles, which contemplates continuation of the
company as a going  concern.  However  the  company  has  sustained  substantial
operating losses in recent years. In addition,  the company has used substantial
amounts of working  capital in its  operations.  Further,  at September 30, 1998
current liabilities exceed current assets by $1,534,841.

In view of these  matters,  realization  of a major portion of the assets in the
accompanying  balance  sheet  is  dependent  upon  continued  operations  of the
company,  which in turn is  dependent  upon the  company's  ability  to meet its
financing requirements, and the success of its future operations.


ITEM 2.

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations

Results of  Operations  for the three  month  period  ended  September  30, 1998
compared to the same period in 1997.

     On a consolidated  basis,  after the acquisition of Goldpoint and Watchout!
subsidiaries, the Company had revenues in the third quarter of 1998 of ($40,189)
as compared to the same period in 1997 of $2,151.  The cost of goods sold in the
three  month  period  in 1998 was  $53,898  and for the same  period in 1997 was
$184,797.  The  gross  profit  (loss)  for the 1998  third  quarter  period  was
($94,087) compared to ($182,646) for the 1997 period.

     The Company  incurred  operating  expenses  for the three  month  period of
$320,363 in 1998  compared  to $940,944 in the same period in 1997.  The Company
recorded a net operating loss of ($414,450) for the 1998 period as compared to a
($723,590)  operating  loss for the same  period in fiscal  year  1997.  The net
income  (loss)  for the 3  month  period  in 1998  was  ($418,715)  compared  to
($735,686) in 1997. The losses were due to expenses and costs for the production
and  marketing of Watchout!  and  Goldpoint  products.  The Company  losses will
continue  until more  revenue  from sales can be achieved  and until  profitable
operations  are  achieved.  While the  Company is seeking  capital  sources  for
investment,  there is no assurance that capital  sources can be found.  The loss
per share for the 1998 third quarter was ($.05)  compared to ($.03) in the third
quarter of 1997.

Results of  Operations for the nine month period ended June 30, 1998 compared to
the same period in 1997.

     On a consolidated  basis,  after the acquisition of Goldpoint and Watchout!
subsidiaries,  the  Company  had  revenues  in the first nine  months of 1998 of
$132,959 as compared to the same period in 1997 of  $434,593.  The cost of goods
sold in the  period  in 1998 was  $141,929  and for the same  period in 1997 was
$259,391.  The gross profit for the 1998 period after a "returns and  allowances
deduction" of $195,294 was ($8,970) compared to $175,202 for the 1997 period.

     The  Company  incurred  operating  expenses  for the nine  month  period of
$481,695 in 1998  compared  to $699,244 in the same period in 1997.  The Company
recorded a net operating  loss of  ($490,665)  for the 1998 nine month period as
compared to a ($524,042) operating loss for the same period in fiscal year 1997.
The net  income  (loss)  for the  period  in 1998  was  ($483,420)  compared  to
($581,534)  in 1997.  The losses were due to start up expenses  and research and
development  and marketing  costs for the production of Watchout!  and Goldpoint
products.  The Company losses will continue until more revenue from sales can be
achieved and until  profitable  operations  are  achieved.  While the Company is
seeking  capital  sources for  investment,  there is no  assurance  that capital
sources  can be found.  The loss per share for the 1998 nine  month  period  was
($.03) compared to ($.04) in the same period of 1997.

Liquidity and Capital Resources

     The Company had nominal cash capital at the end of the period.  The Company
will be forced to make private  placements of stock in order to fund  operations
continuance. No assurance exists as to the ability to make private placements of
stock. At September 30, 1998, it had accounts  receivable (net) of about $29,144
and  inventory  of $162,000 and escrows of $56,250  which total  $278,391 as its
assets.  The Company has  significant  current  liabilities of $1,813,232  which
exceed current assets by approximately $1,534,841.  The Company is in default on
certain outstanding notes totalling $450,000, although no demand for payment has
been issued.


PART II
                                                 OTHER INFORMATION

Item 1.           Legal Proceedings -

                  In July 1998, Boit Incorporation, the LCD technology licensor,
                  filed suit in  San Diego,  California  Superior  Court,  about
                  registrants relationship with its  agent  in Hong  Kong, Camke
                  Development Ltd.  The allegation was that Camke was in reality
                  a third party licensee and not actually a  manufacturing agent
                  and distributor  for South  East Asia.  Boit also claimed that
                  Registrant  breached the  license contract  by  not yet having
                  products in  the  marketplace and  seeks cancellation  of  the
                  contract.

                  A response was filed that the allegations are totally  without
                  merit and that in accordance with the contract with Boit,  all
                  disputes have a specific method  of being resolved - mediation
                  and binding arbitration precedent to litigation. The Court has
                  referred the matter to arbitration.

                  If the technology  license agreement  were to be  canceled, it
                  would materially affect the Company by eliminating its primary
                  product lines  in  the watch business.   No  prediction of  an
                  outcome can be made.

Item 2.           Changes in securities - None.

Item 3.           Defaults upon senior securities - None.

<PAGE>

Item 4.           Submission of matters to a vote of security holders

                  None in the period ended September 30, 1998.

Item 5.           Other information - None.

Item 6.           Exhibits and reports on Form 8-K

                  (a)      The following are filed as Exhibits to this
                           Quarterly Report.  The numbers refer to the
                           Exhibit Table of Item 601 of Regulation S-K:

                                    None.

                  (b)      Reports on Form 8-K filed during the three months
                           ended September 30, 1998. (incorporated by
                           reference)

                                    None.

                                   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 of the
undersigned thereunto duly authorized.


Dated: _______________

                                          WHITE CLOUD EXPLORATION, INC.


                                          by: /s/ Robert Galoob
                                             -----------------------------------
                                              President