SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                    FORM 10-Q

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

                For the Quarterly Period ended September 30, 1997

                                       OR

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


     Commission File Number:            33-18099-NY and 33-23169-NY

         QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
        (Exact Name of small business issuer as specified in its charter)

         DELAWARE                                               11-2873662
State or other jurisdiction of                           (IRS Employer I.D. No.)
Incorporation or organization)

                 6900 Jericho Turnpike, Syosset, New York 11791
                    (Address of principal executive offices)

Issuer's telephone number, including area code:                (516) 364 - 3500
Securities registered pursuant to Section 12(b) of the Act:                 None
Securities registered pursuant to Section 12(g) of the Act:                 None

Indicate by check mark whether the registrant (1) 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 _____

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
Common Stock, as of the last practicable date.

         Class                                 Outstanding at September 30, 1997
-----------------------                        ---------------------------------
Common Stock, par value                                   121,536,595
  $.00003 per share


<PAGE>



PART 1 FINANCIAL INFORMATION
Item 1, financial statements


QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
FINANCIAL STATEMENTS (Unaudited)
September 30, 1997



Financial Statements                                                        Page
                                                                            ----
                                                                        
Balance Sheet                                                              3 - 4
                                                                        
                                                                        
Statements Operations                                                      5 - 6
                                                                        
                                                                        
Statements of Shareholders' (Deficit)                                          7
                                                                        
                                                                        
Statements of Cash Flows                                                  8 - 11
                                                                        
                                                                        
Notes to Financial Statements                                            12 - 13
                                                                        
                                                                        
Management's Discussion and Analysis                                     14 - 16
                                                                        
                                                                        
Other Information                                                             17
                                                                        
                                                                        
Signatures                                                                    18


                                        2


<PAGE>


QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Balance Sheet
September 30, 1997

(Unaudited)


<TABLE>
<S>                                                                                      <C>     
Assets
     Current Assets
         Cash                                                                            $ 26,450
         Accounts receivable - net of allowance for doubtful accounts of $1,000            10,458
         Inventory                                                                         80,928
         Advances for clinical study                                                       25,000
         Advances to Automotive Marketing, Inc.                                            85,909
         Prepaid expenses                                                                   5,414
                                                                                         --------
                                                                                          234,159
     Furniture and Equipment - at cost - net of accumulated
         depreciation of $18,649                                                           29,766

     Patents - at cost - net of accumulated amortization
         of $8,938                                                                         40,497

     Deferred preoperating and developmental costs                                         17,987

     Security Deposits                                                                      4,137
                                                                                         --------

                                                                                         $326,546
                                                                                         ========
</TABLE>


See notes to financial statements.


                                        3


<PAGE>



QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Balance Sheet
September 30, 1997

(Unaudited)


<TABLE>
<S>                                                                                       <C>        
Liabilities and Shareholders' (Deficit)
     Current Liabilities
         1992 convertible debentures - including accrued
              interest of $8,575                                                          $    18,575
         Shareholder's loan - current portion                                                  44,805
         Taxes payable                                                                          4,387
         Accounts payable                                                                     532,016
         Accrued officer and director's compensation                                           87,500
         Loans from directors                                                                  34,415
         Accrued expenses                                                                      30,427
                                                                                          -----------

                                                                                              752,125

     Shareholder's Loan - net of current portion                                              127,500
                                                                                          -----------

     Shareholders' (Deficit)
         Series A Convertible Preferred Stock -
              par value $.001 - authorized 600,000 shares -
              no shares issued and outstanding
         Series B Convertible Preferred Stock -
              par value $.001 - authorized 5,000,000 shares -
              no shares issued and outstanding
         Common Stock - par value $.00003 -
              authorized 130,000,000 shares -
              121,536,595 shares issued and outstanding                                         3,646
         Capital in excess of par                                                           3,248,406
         Accumulated (deficit)                                                             (3,805,131)
                                                                                          -----------

                                                                                             (553,079)
                                                                                          -----------
                                                                                          $   326,546
                                                                                          ===========
</TABLE>


See notes to financial statements.


                                        4


<PAGE>



QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Statements of Operations

(Unaudited)



                                                   For the Nine Months Ended
                                                          September 30,
                                                --------------------------------
                                                     1997               1996
                                                     ----               ----

Sales - net                                     $     281,084     $   1,308,520

Cost of Sales                                         111,042           252,247
                                                -------------     -------------

                                                      170,042         1,056,273
                                                -------------     -------------

Selling Expenses                                       59,899           988,706

General and Administrative Expenses                   364,695           558,448
                                                -------------     -------------

                                                      424,594         1,547,154
                                                -------------     -------------

(Loss) Before Other Income (Expenses)                (254,552)         (490,881)
                                                -------------     -------------


Other Income (Expenses)
     Interest income                                    3,953             2,467
     Interest (expense)                               (28,945)          (69,525)
     Forgiveness of indebtedness                       61,000              --
                                                -------------     -------------
                                                       36,008           (67,058)
                                                -------------     -------------

Net (Loss)                                      $    (218,544)    $    (557,939)
                                                =============     =============


(Loss) Per Share                                $    NIL          $    NIL
                                                =============     =============


Weighted Average Number of Shares
     Outstanding (to nearest 1,000,000)           110,000,000        77,000,000
                                                =============     =============


See notes to financial statements.


                                        5


<PAGE>



QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Statements of Operations

(Unaudited)


                                                      For the Quarter Ended
                                                          September 30,
                                                --------------------------------
                                                     1997              1996
                                                     ----              ----

Sales - net                                     $      94,843     $     226,473

Cost of Sales                                          38,273            64,611
                                                -------------     -------------

                                                       56,570           161,862
                                                -------------     -------------

Selling Expenses                                       13,960            85,344

General and Administrative Expenses                    70,005           151,772
                                                -------------     -------------

                                                       83,965           237,116
                                                -------------     -------------

(Loss) Before Other Income (Expenses)                 (27,395)          (75,254)
                                                -------------     -------------


Other Income (Expenses)
     Interest income                                      217             2,342
     Interest (expense)                                (5,641)          (13,265)
                                                -------------     -------------
                                                       (5,424)          (10,923)
                                                -------------     -------------

Net (Loss)                                      $     (32,819)    $     (86,177)
                                                =============     =============


(Loss) Per Share                                $    NIL          $    NIL
                                                =============     =============


Weighted Average Number of Shares
     Outstanding (to nearest 1,000,000)           113,000,000        96,000,000
                                                =============     =============

See notes to financial statements.


                                        6


<PAGE>

QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Statement of Shareholders' (Deficit)
For the Nine Months Ended September 30, 1997

(Unaudited)


<TABLE>
<CAPTION>
                                                                   Number of
                                                                 Common Stock          Amount         Capital in
                                                                    Shares            $.00003          Excess of         Accumulated
                                                                 (Post-Split)        Par Value         Par Value          Deficit
                                                                  -----------       -----------       -----------       -----------
<S>                                                               <C>               <C>               <C>               <C>         
Balance - December 31, 1996                                       108,369,929       $     3,251       $ 3,080,051       ($3,586,587)

Stock issued for accrued services rendered:
         Officers and Directors                                     7,166,666               215           108,535              --


Proceeds from sales of stock to
     Officers and Directors                                         6,000,000               180            59,820              --


Net (Loss)                                                               --                --                --            (218,544)
                                                                  -----------       -----------       -----------       -----------


Balance - September 30, 1997                                      121,536,595       $     3,646       $ 3,248,406       ($3,805,131)
                                                                  ===========       ===========       ===========       ===========
</TABLE>


See notes to financial statements.


                                        7


<PAGE>



<TABLE>
<CAPTION>
QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Statements of Cash Flows                                                                                                 Page 1 of 2

(Unaudited)
                                                                                                       For the Nine Months Ended
                                                                                                             September 30,
                                                                                                    --------------------------------
                                                                                                       1997                  1996
                                                                                                       ----                  ----
<S>                                                                                                 <C>                   <C>       
Cash Flows from Operating Activities
     Net (loss)                                                                                     $(218,544)            $(557,939)
     Adjustments to reconcile net (loss) to net cash
         (used for) operating activities:
              Depreciation and amortization                                                             4,215                 4,605
              Expenses paid through the issuance of
                  restricted common stock                                                             108,750                43,700
              (Increase) decrease in:
                  Accounts receivable                                                                  (6,171)               45,830
                  Inventories                                                                          46,485                39,387
                  Advances to Automotive Marketing, Inc.                                              (85,909)                 --
                  Funds placed in escrow                                                                 --                (121,697)
                  Accrued interest on debentures and bonds                                             15,541                  --
                  Prepaid expenses                                                                       --                  16,583
                  Deferred preoperating and developmental costs                                       (17,987)                 --
              Increase (decrease) in:
                  Notes payable - vendor                                                              (20,940)                 --
                  Accounts payable                                                                    (82,311)              230,635
                  Accrued officers' and directors' compensation                                        27,500                  --
                  Taxes payable                                                                            90                   679
                  Loans from directors                                                                  1,246                  --
                  Accrued expenses                                                                    (47,952)                 --
                                                                                                    ---------             ---------

                                                                                                     (275,987)             (298,217)
                                                                                                    ---------             ---------
Cash Flows from Investing Activities
     Acquisition of equipment                                                                          (5,500)                 (168)
     Patent payments                                                                                   (2,435)                 --
                                                                                                    ---------             ---------
                                                                                                       (7,935)                 (168)
                                                                                                    ---------             ---------
Cash Flows from Financing Activities
     Letter of credit collateral                                                                         --                (168,000)
     Proceeds from sales of common stock                                                               60,000               484,050
     Repayment of advances from officer/stockholder                                                      --                  (9,000)
     Temporary media funds received, net of
         repayments and client fund account balances                                                     --                 170,000
     Conversion/proceeds on senior subordinated debentures                                            (10,000)              (14,865)
                                                                                                    ---------             ---------

                                                                                                       50,000               462,185
                                                                                                    ---------             ---------

(Decrease) Increase in Cash                                                                          (233,922)              163,800

Cash - beginning                                                                                      260,372               176,818
                                                                                                    ---------             ---------

Cash - end                                                                                          $  26,450             $ 340,618
                                                                                                    =========             =========
</TABLE>


See notes to financial statements.


                                        8


<PAGE>



<TABLE>
<CAPTION>
QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Statements of Cash Flows                                                                                                 Page 2 of 2

(Unaudited)
                                                                                                       For the Nine Months Ended
                                                                                                             September 30,
                                                                                                    --------------------------------
                                                                                                       1997                  1996
                                                                                                       ----                  ----
<S>                                                                                                 <C>                   <C>       
Supplemental Disclosures

     Interest paid                                                                                  $   --                 $ 35,560
                                                                                                    ========               ========
                                                                                                   
     Temporary media funds received                                                                 $   --                 $265,000
                                                                                                    ========               ========
                                                                                                   
     Debt conversions to common stock                                                               $   --                 $408,708
                                                                                                    ========               ========
                                                                                                   
     Conversion of accrued officer salary                                                          
         to common stock                                                                            $  8,750               $144,160
                                                                                                    ========               ========
                                                                                                   
     Stock issued for accrued services rendered                                                     $100,000               $   --
                                                                                                    ========               ========
</TABLE>


See notes to financial statements.


                                        9

<PAGE>



<TABLE>
<CAPTION>
QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Statements of Cash Flows                                                                                                 Page 1 of 2

(Unaudited)
                                                                                                         For the Quarter Ended
                                                                                                             September 30,
                                                                                                    --------------------------------
                                                                                                       1997                  1996
                                                                                                       ----                  ----
<S>                                                                                                 <C>                   <C>       
Cash Flows from Operating Activities
     Net (loss)                                                                                     $ (32,819)            $ (86,177)
     Adjustments to reconcile net (loss) to net cash
         (used for) operating activities:
              Depreciation and amortization                                                             1,405                 1,535
              Expenses paid through the issuance of
                  restricted common stock                                                                --                    --
              (Increase) decrease in:
                  Accounts receivable                                                                 (10,458)               21,935
                  Inventories                                                                          25,673                64,611
                  Advances to Automotive Marketing, Inc.                                              (67,709)                 --
                  Funds placed in escrow                                                                 --                 (10,338)
                  Accrued interest on debentures and bonds                                              5,016                 4,339
                  Prepaid expenses                                                                       --                  (6,896)
                  Deferred preoperating and developmental costs                                         2,341                  --
              Increase (decrease) in:
                  Accounts payable                                                                    (68,695)              (73,924)
                  Accrued officers' and directors' compensation                                        42,500                  --
                  Taxes payable                                                                           (18)                   82
                  Accrued expenses                                                                      1,293                  --
                                                                                                    ---------             ---------

                                                                                                     (101,471)              (84,833)
                                                                                                    ---------             ---------

Cash Flows from Financing Activities
     Proceeds from sales of common stock                                                               60,000               484,050
     Letter of credit collateral                                                                         --                (168,000)
     Conversion/proceeds on senior subordinated debentures                                               --                 (14,865)
                                                                                                    ---------             ---------

                                                                                                       60,000               301,185
                                                                                                    ---------             ---------

(Decrease) Increase in Cash                                                                           (41,471)              216,352

Cash - beginning                                                                                       67,921               124,266
                                                                                                    ---------             ---------

Cash - end                                                                                          $  26,450             $ 340,618
                                                                                                    =========             =========
</TABLE>


See notes to financial statements.


                                       10


<PAGE>



<TABLE>
<CAPTION>
QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Statements of Cash Flows                                                                                                 Page 2 of 2

(Unaudited)
                                                                                                         For the Quarter Ended
                                                                                                             September 30,
                                                                                                    --------------------------------
                                                                                                       1997                  1996
                                                                                                       ----                  ----
<S>                                                                                                 <C>                   <C>       
Supplemental Disclosures

     Interest paid                                                                                  $    --               $11,875
                                                                                                    =========             =======
                                                                                                    
                                                                                                    
                                                                                                    
     Debt conversions to common stock                                                               $    --               $10,516
                                                                                                    =========             =======
</TABLE>


See notes to financial statements.


                                       11

<PAGE>



QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
NOTES TO FINANCIAL STATEMENTS (Unaudited)
September 30, 1997


1.   BACKGROUND AND BASIS OF PRESENTATION

     PhaseOut of America,  Inc.  (the  "Company")  was  organized  as a Delaware
     Corporation  on July 17, 1987 and operated as a  development  stage company
     through  1993.  On  September  24,  1997,  the  Company's   certificate  of
     incorporation was amended, changing its name from PhaseOut of America, Inc.
     to Quest  Products  Corporation.  The  Company's  purpose  is to market and
     distribute  its patented  phase-out  system smoking  cessation  device (the
     "product").

     The Company had primarily marketed the product in the United States through
     direct  response   marketing   including   radio,   television   spots  and
     infomercials.  This  domestic  marketing  was  curtailed due to the ongoing
     negotiations  with the Federal Trade Commission  ("FTC").  Once advertising
     claims are  approved,  the Company  intends to reenter the domestic  retail
     market. The Company also distributes the product overseas.

     The financial  statements have been prepared assuming that the Company will
     continue as a going concern. The Company has suffered recurring losses from
     operations  ($218,544  in 1997 and  $557,939 in 1996),  and has had limited
     liquidity  causing  difficulty  in meeting  its current  operating  expense
     obligations  and  debt  service  requirements.   The  Company  is  actively
     marketing  the  product to help  improve  revenues  and is planning to seek
     additional financing through private placement of debt and securities.  The
     financial  statements  do not include  any  adjustments  that might  result
     should  the  continued  existence  of  the  Company  be  threatened  by any
     continued  losses or the  failure  of the above  factors to  influence  the
     financial viability of the Company.

     The interim  statements  were  prepared  pursuant to the  requirements  for
     reporting  on Form  10-QSB.  The  interim  financial  statements  and notes
     thereto  should be read in  conjunction  with the financial  statements and
     notes included in the Company's latest Annual Report on Form 10-KSB for the
     year ended  December 31, 1996.  In the opinion of  management,  the interim
     financial  statements  reflect all adjustments of a normal recurring nature
     necessary  for a fair  statement  of the results for interim  periods.  The
     current period results of operations are not necessarily  indicative of the
     results for the entire year ending December 31, 1997.

2.   SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

     Changes  in  significant  accounting  policies  - There  were no changes in
     significant accounting policies during the current period.

3.   STOCKHOLDERS' EQUITY

     Stock Issued to Officers, Consultants and Employees - Through September 30,
     1997, the Company issued 13,166,666 shares to officers and directors.


                                       12


<PAGE>


4.   RELATED PARTY TRANSACTIONS

     Loan from Director - A former officer/shareholder,  who is still a director
     of the Company,  is owed  $34,415 by the Company.  The amount is payable on
     demand with a stated  interest rate of 11%.  Effective  June 30, 1997,  the
     former officer/shareholder agreed to no longer charge interest.

     Accrued  Officer and  Director's  Compensation  - During 1996,  an investor
     group  consisting  of two  individuals,  which  acquired  an 18%  ownership
     interest for $500,000,  was awarded two seats on the Board of Directors and
     two officer positions. The two individuals each receive a consulting fee of
     $60,000 per annum for their management duties. During the second quarter of
     1997,  3,333,333 shares of stock were issued to each individual for accrued
     services rendered of $50,000 each.

5.   SHAREHOLDER'S LOAN

     During 1996, the Company received  $200,000 from a shareholder as a loan in
     connection with the Company's media campaign. The loan is to be paid at the
     rate of $2,500 per month.  Interest  accrues at 10% and will be paid with a
     final balloon payment. The shareholder originally agreed to a moratorium on
     the monthly  $2,500  payments  from May 1997 through  August 31, 1997,  but
     subsequently extended the moratorium indefinitely.

6.   COMMITMENTS, CONTINGENCIES AND OTHER COMMENTS.

     Dependence  on Major  Customers  and  Suppliers  - Export  sales  represent
     approximately 100% of sales with only one export customer representing more
     than 10% of total sales.

     The  Company  is  currently  purchasing  100% of its  products  from  three
     vendors.

     Regulatory Matters - There have been no changes in the status of regulatory
     inquiries by the Food and Drug  Administration  (FDA) and the Federal Trade
     Commission (FTC).

     Litigation - In July 1997, the Company's former attorney, who is a relative
     of a  Director,  brought an action  against  the  Company in New York State
     Supreme Court,  New York County for unpaid attorney fees and  disbursements
     of approximately  $18,000.  Legal counsel has not rendered an opinion as to
     the ultimate outcome of this matter.


                                       13


<PAGE>



QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Management's Discussion and Analysis


                              Results of Operations
                  Nine Months Ended September 30, 1997 Compared
                     to Nine Months Ended September 30, 1996


     The  Company  incurred a net loss of  $218,544  for the nine  months  ended
September 30, 1997 as compared to the loss of $557,939 for the nine months ended
September 30, 1996. Nine-month sales decreased $1,027,436. The decrease in sales
resulted from no retail sales in 1997 of the product through  television  direct
response  methods which results in  substantially  higher unit selling prices as
well as increases in unit volume. The Company's  domestic  marketing  activities
were curtailed due to the ongoing  negotiations  with the FTC. Once  advertising
claims are approved, the Company intends to reenter the domestic retail market.

     Selling  expenses  decreased  from  $988,706  to $59,899 as a result of the
elimination in 1997 of the  substantial  additional  costs  associated  with the
distribution of the product through television response channels.

     General and administrative  expenses decreased from $558,448 to $364,695 as
a result  of a  decrease  in  officer  salaries  ($109,617)  and a  decrease  in
professional fees ($127,322).

     The gross profit margin  decreased to 60% from 81%, due to the  elimination
of the high volume of direct response television sales.

     The Company maintains a $500,000 liability insurance policy.


                                       14


<PAGE>


QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Management's Discussion and Analysis


                         Liquidity and Capital Resources

Cash of $275,987 was used for  operations  for the 9 months ended  September 30,
1997 as  compared  to  $298,217  used in the  same  period  of last  year.  Cash
decreased during the 9 months ended September 30, 1997 by $233,922.

The Company's  working capital has deteriorated due to the use of current assets
for operations. Working capital and current ratios were:

                          September 30,         December 31,       September 30,
                              1997                  1996                1996
                              ----                  ----                ----
Working capital
(deficiency)               $(517,966)            $(436,465)          $(378,408)
Current ratios               0.31:1                0.49:1              0.67:1

In order to meet short-term  marketing  goals, in July 1997 certain officers and
directors  agreed to acquire an aggregate of 10,000,000  shares of the Company's
common  stock  (representing  8% of total shares  outstanding)  for an aggregate
purchase  price of $100,000.  As of September 30, 1997, the Company has received
$60,000.  The Company is also seeking an additional  $200,000 of financing under
the same terms and conditions as offered to the officers and directors. There is
no assurance that the Company will be able to obtain additional financing.


                           Distribution and Marketing

Marketing (Domestic)

     During the second half of 1996, the Company's domestic marketing activities
were curtailed due to the  negotiations  with the Federal Trade Commission as to
what  advertising  claims could be made to describe the PhaseOut  product.  Once
advertising  claims are approved,  management  intends to aggressively enter the
U.S. retail market under the category of smoke cessation products.

Marketing (International)

     On August 21, 1995,  the Company  entered  into an  agreement  with a South
Korean  trading  company  for the  distribution  and  manufacture  of a modified
(design)  PhaseOut  product in South Korea.  Because of the improved  design and
reduced size of this PhaseOut device, it will be utilized in the Japanese market
as well.  South Korea has 10 million  smokers and Japan has 35 million  smokers.
Distribution in South Korea is expected to begin in the 1st quarter of 1998.

     PhaseOut  has started  distribution  through  television  infomercials  and
commercials in the following countries:  Portugal, Spain, South Africa, Romania,
Hungary, Australia, Italy and Germany.


                                       15


<PAGE>


QUEST PRODUCTS CORPORATION (formerly PHASEOUT OF AMERICA, INC.)
Management's Discussion and Analysis


New Products

     In  February  1997,  the  Company  executed a letter of intent  with Andrea
Eyewear,  Inc, (Andrea) whereby the Company agreed to fund the pre-operating and
developmental  costs  of  a  patented  sunglass  product  owned  by  Andrea.  In
consideration for the funding, the Company would receive an exclusive license to
commercialize  the sunglass  product  worldwide.  As of September 30, 1997,  the
Company has  incurred  $17,987 of  pre-operating  and  developmental  costs.  In
September 1997, Andrea terminated the letter of intent claiming that the Company
had not performed in accordance with its terms. The Company believes that it has
valid defenses against Andrea and intends to pursue its defenses vigorously.

     In May 1997,  the Company  entered  into a joint  venture  with  Automotive
Marketing,  Inc. to manufacture and distribute  aftermarket automobile products.
As of September 30, 1997,  the Company has made advances of $85,909 to the joint
venture with the  understanding  that any such advances will be reimbursed  when
revenue-producing operations commence.

                               Regulatory Matters

     There have been no material changes in the status of matters pending before
the Food and Drug Administration (FDA) and the Federal Trade Commission (FTC).


                                       16


<PAGE>


                           PART II - OTHER INFORMATION



Item 1.   Legal Proceedings

          The Company has been sued by a former attorney for fees it alleges are
          due but unpaid in the amount of approximately  $18,000.  Legal counsel
          has not rendered an opinion as to the ultimate outcome of this matter.

Item 2.   Changes in Securities

                           None

Item 3.   Defaults Upon Senior Securities

                           None

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

                           None

Item 5.   Other Information

                           See notes to the financial statements

Item 6.   Exhibits and Reports

                           None


                                       17


<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.


                                           QUEST PRODUCTS CORPORATION
                                           (formerly PHASEOUT OF AMERICA, INC.)

Dated:  November 10, 1997


                                           /s/ Herbert M. Reichlin
                                           -------------------------------------
                                           Herbert M. Reichlin
                                           Chief Operating Officer and Treasurer


                                       18