SECURITIES AND EXCHANGE COMMISSION
                                WASHINGTON, D.C.

                                   FORM 1O-Q

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

                 For the Quarterly Period Ended March 31, 1997

                         Commission File Number 0-17977


                              SunRiver Corporation
             (Exact name of registrant as specified in its charter)

                                    Delaware
         (State or other Jurisdiction of Incorporation or Organization)

                                   13-3469637
                      (I.R.S. Employer Identification No.)

                              9430 Research Blvd.
                              Bldg. IV, Suite 200
                                   Austin, TX
                    (Address of principal executive offices)

                                   78759-6543
                                   (Zip Code)

                                 (512) 349-5800
              (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___

As of May 14, 1997, the Registrant had 48,871,757  shares of Common Stock,  $.01
par value per share outstanding.
<PAGE>


                         PART 1 - FINANCIAL INFORMATION

Item 1.  Financial Statements

              INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Balance Sheets as of
  March 31, 1997 (unaudited) and December 31, 1996............................ 3

Consolidated Statements of Operations (unaudited)
  for the three months ended March 31, 1997 and 1996.......................... 4

Consolidated Statements of Cash Flows (unaudited)
  for the three months ended March 31, 1997 and 1996.... ..................... 5

Notes to Consolidated Financial Statements (unaudited)........................ 6

<PAGE>


                     SUNRIVER CORPORATION AND SUBSIDIARIES
                     CONDENSED CONSOLIDATED BALANCE SHEETS
                         (dollar amounts in thousands)
                                     ASSETS

                                                    March 31,  December 31,
                                                      1997         1996
                                                   ----------- -----------
                                                   (unaudited)
Current assets:
                      
     Cash and cash equivalents.................   $    4,860     $    5,213
     Trade accounts receivable, net............       14,846         22,046
     Inventories...............................       15,532         18,525
     Deferred income taxes.....................          -              -
     Prepaid expenses and other current assets.        1,511            256
                                                  -----------    -----------
          Total current assets.................       36,749         46,040
Property and equipment, net....................       11,264         11,474
Goodwill, net..................................        9,236          9,505
Other assets...................................        2,326          2,506
                                                  -----------    -----------
                                                  $   59,575     $   69,525
                                                  ===========    ===========

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
     Notes payable.............................   $   15,421     $   13,950
     Current portion of long-term debt.........        8,006          8,009
     Accounts payable..........................        5,178         10,892
     Accrued expenses..........................        5,510          6,345
     Deferred revenue..........................          230            180
     Net liabilities of discontinued operation.        1,254          3,492
                                                  -----------    -----------
          Total current liabilities                   35,599         42,868
Long-term liabilities:
     Long-term debt, less current maturities...       10,182         13,382
     Deferred income taxes.....................          -              -
     Other.....................................          810            918
                                                  -----------    -----------
          Total long-term liabilities..........       10,992         14,300
                                                  -----------    -----------
          Total liabilities....................       46,591         57,168

Commitments and contingencies..................

Mandatorily redeemable preferred stock of
  subsidiary...................................        3,555          3,555
Stockholders' equity:
     Preferred stock...........................          -              -
     Common stock..............................          488            486
     Additional paid-in capital................       31,668         31,440
     Accumulated deficit.......................      (22,727)       (23,124)
                                                  -----------    -----------
          Total stockholders' equity...........        9,429          8,802
                                                  -----------    -----------
                                                  $   59,575     $   69,525
                                                  ===========    ===========

                                       3

<PAGE>
                     SUNRIVER CORPORATION AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                     (in thousands, except per share data)
                      For the Three Months Ended March 31,

                                                      1997         1996
                                                   ----------- -----------
                                                         (unaudited)

Revenue.......................................    $   23,924     $   37,671
Cost of revenue...............................        18,467         29,663
                                                  -----------    -----------
          Gross margin........................         5,457          8,008
Operating expenses:
     Sales and marketing......................         1,782          2,178
     General and administrative...............         1,629          1,743
     Research and development.................           724          1,299
                                                  -----------    -----------
          Total operating expenses............         4,135          5,220
                                                  -----------    -----------
               Operating income...............         1,322          2,789
Other (income) expense:
     Interest expense, net....................           807          1,045
     Other....................................            (5)           210
                                                  -----------    -----------
          Total Other Expenses................           802          1,255
                                                  -----------    -----------

Income before income taxes and
     discontinued operations..................           520          1,533
                                                  

Income tax expense............................            -             410
                                                  ----------     -----------

Income before discontinued operations.........           520          1,123

Loss from discontinued operations.............            -            (762)
                                                  ----------     -----------

Net income....................................           520            361
Dividend on preferred stock of subsidiary.....           124            124
                                                  -----------    -----------
Earnings available for common shareholders....    $      396     $      237
                                                  ===========    ===========
Weighted average common shares outstanding....        48,626         45,872
                                                  ===========    ===========
Earnings per common share:
     Continuing operations....................    $     0.01     $     0.02
     Discontinued operations..................          0.00          (0.02)
                                                  -----------    -----------
Earnings per common share.....................    $     0.01     $     0.00
                                                  ===========    ===========


                                       4
<PAGE>
                     SUNRIVER CORPORATION AND SUBSIDIARIES
                CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                         (dollar amounts in thousands)
                      For the Three Months Ended March 31,

                                                      1997         1996
                                                   ----------- -----------
                                                          (unaudited)

Cash flows from opoerating activities:
     Net income...............................    $      520     $      361
     Adjustments to reconcile net income
          to net cash provided by (used in)
          operating activities:
          Loss from discontinued operations...           -              762
          Depreciation and amortization.......           790            956
          Deferred revenues...................            50           (433)
          Provision for doubtful accounts.....           118           (499)
          Provision for excess and obsolete
               inventory......................           422            654
          Estimated value of compensatory
               warrants.......................           -               75
     Changes in assets and liabilities:
          Trade accounts receivable...........         7,082         (1,559)
          Inventories.........................         2,571           (772)
          Other assets........................        (1,333)         1,225
          Accounts payable and accrued
               expenses.......................        (9,018)           234
                                                  -----------    -----------
Net cash provided by operating activities.....         1,202          1,004
                                                  -----------    -----------
Cash flows from investing activities:
     Capital expenditures.....................           (53)          (528)
                                                  -----------    -----------
Net cash used in investing activities.........           (53)          (528)
                                                  -----------    -----------
Cash flows from financing activities:
     Proceeds from issuance of common stock...             2          1,067
     Decrease in short-term debt, net.........           -              (30)
     Proceeds from debt issuance..............         1,700          1,500
     Purchase of treasury stock...............           -           (1,305)
     Net change in revolving loan payable.....           -            1,500
     Payment on term loan.....................        (3,200)        (1,500)
     Payments on capital leases...............            (4)            (3)
                                                  -----------    -----------
Net cash provided by (used in) financing
     activities...............................        (1,502)         1,229
                                                  -----------    -----------
Net increase (decrease) in cash and cash
     equivalents..............................          (353)         1,705
Cash and cash equivalents at beginning of
     period...................................         5,213            369
                                                  -----------    -----------
                                                  

Cash and cash equivalents at end of period....    $    4,860     $    2,074
                                                  ===========    ===========

Non-cash transactions:
     Dividend on preferred stock of
       subsidiary.............................    $      124     $      124
     Conversion of notes payable to common
       stock..................................           228            109
     Estimated value of compensatory warrants.           -              491
     Issuance of common stock for consulting
       services...............................           -              893
Cash paid for:
     Interest.................................           293            782
     Taxes....................................             6            205


                                       5
<PAGE>
                     SUNRIVER CORPORATION AND SUBSIDIARIES
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                         (dollar amounts in thousands)
                                  (Unaudited)

1.  Condensed Consolidated Financial Statements

Basis of Presentation
---------------------

The accompanying unaudited condensed consolidated financial statements have been
prepared in accordance with generally accepted accounting principles for interim
financial information and with the instructions to Form 10-Q and Regulation S-X.
Accordingly,  they do not include all of the information and footnotes  required
by generally accepted accounting  principles for complete financial  statements.
In the  opinion  of  management,  all  adjustments  (consisting  of only  normal
occurring  accruals)  considered  necessary  for a fair  presentation  have been
included.  Certain prior period amounts in these financial  statements have been
reclassified to conform to current period  presentation.  Operating  results for
the three-month  period ended March 31, 1997 are not  necessarily  indicative of
the results  that may be expected  for the year ended  December  31,  1997.  For
further information refer to the consolidated financial statements and footnotes
thereto in the Company's  Annual Report on Form 10-K for the year ended December
31, 1996.

2.  Background

SunRiver Corporation (the Company) is engaged, through its subsidiary, Boundless
Technologies,   Inc.  (Boundless),   in  designing  and  manufacturing  computer
terminals and network computers for business use. The Company's general strategy
is to provide access to corporate computing environments,  including mainframes,
LANS,  WANS,  intranets  and  the  Internet.   Boundless   principally  designs,
assembles,  sells and  supports  (i) General  Display  Terminals,  (ii)  Network
Computers  and  (iii)  other  terminal  products  that are  used in  multi-user,
personal computer and mini-computer-based  environments.  The Company receives a
royalty from a partnership (the GAI Partnership) formed by Boundless and General
Automation,  Inc.  (GAI)  and  managed  by  GAI.  The GAI  Partnership  designs,
integrates, sells and supports multi-user computer systems that can manage large
volumes of data running  Boundless'  and GAI's  versions of a data-based  system
licensed from Pick Systems.

The operations at OTW Corporation (OTW),  formerly TradeWave  Corporation,  were
discontinued in December 1996.

3.  Inventories

Inventories  are stated at the lower of cost or market.  Cost is determined on a
first-in  first-out  basis.  The major components of inventories are as follows:

                                                   March 31,     December 31,
                                                     1997            1996
                                                  -----------    -----------
Raw materials and purchased components........... $    11,386    $    12,845
Finished goods...................................       3,537          4,942
Demonstration equipment..........................         260            396
Service parts....................................         349            342
                                                  -----------    -----------
                                                  $    15,532    $    18,525
                                                  ===========    ===========

                                       6
<PAGE>

4.  Equity

At March 31, 1997 and December 31, 1996,  stockholders'  equity consisted of the
following:

                                                   March 31,    December 31,
                                                     1997           1996
                                                  -----------   -----------

Preferred stock, $0.01 par value, 1,000,000
     shares authorized, none issued.............. $       -      $    -
Common stock, $0.01 par value, 60,000,000
     shares authorized, 48,796,000 and 48,572,000
     shares issued at December 31, 1996 and
     1995, respectively..........................         488           486
Additional paid-in capital.......................      31,668        31,440
Accumulated deficit..............................     (22,727)      (23,124)
                                                  ------------   -----------
     Total stockholders' equity.................. $     9,429    $    8,802
                                                  ============   ===========

5.  Financings

Regulation S Offerings
----------------------

The Company  completed  two offerings of  securities  under  Regulation S of the
Securities  Act of 1933 (a  "Regulation S Offering")  subsequent to December 31,
1996 described below:

o    In February 1997, the Company  received gross proceeds of $1,000 by selling
     convertible  notes,  bearing  interest at 8%, which  require the holders to
     convert the notes by December  31, 1998 into common  stock.

o    In March  1997,  the  Company  received  gross  proceeds of $400 by selling
     convertible  notes,  bearing  interest at 8%, which  require the holders to
     convert the notes by December  31, 1998 into common  stock.  In  connection
     with this offering,  the Company issued warrants to a financial  advisor to
     purchase  33,000 shares of common stock at an exercise  price of $1.375 per
     share,  exercisable through February 28, 2000. These options were valued at
     approximately  $13. The proceeds of this  offering were used by the Company
     to finance the  discontinuance  of operations at TradeWave.

6.  Employee Stock Options Granted and Warrants Granted

Options to  purchase a total of 450,000  shares of common  stock of the  Company
were granted under the 1995  Incentive  Plan to  employees.  The options vest in
1997, and are exercisable through the year 2002 at an exercise price of $1.03.

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

RESULTS OF  OPERATIONS

The numbers and percentages  contained in this Item 2,  Management's  Discussion
and Analysis of Financial  Condition and Results of Operations are  approximate.
Dollar amounts are stated in thousands.

                                       7

<PAGE>

First quarter of 1997 compared with first quarter of 1996
---------------------------------------------------------

Revenue - Revenue for the quarter ended March 31, 1997 were $23,924, as compared
to $37,671 for the quarter ended March 31, 1996.

Sales of the Company's General Display  Terminals  declined from $29,795 for the
quarter  ended March 31, 1996 to $19,226 for the quarter  ended March 31,  1997.
The  decline is  principally  attributable  to  declines of $4,090 and $3,293 in
sales to VT and Dorio distributors and Digital Equipment Corporation  (Digital),
respectively.  The Digital  Acquisition  agreement  required Digital to purchase
80,000  units in the first  year.  The  Company  believes  that the  significant
purchases  by  Digital  during the  fourth  quarter of 1996 to meet this  volume
commitment  resulted  in  inventory  levels at  Digital  sufficient  to meet its
terminal needs for at least the first half of 1997.  The VT and Dorio  terminals
are based on a proprietary  architecture  and, as a result,  the users requiring
flexibility  are prone to more quickly move to alternative  platforms.  Finally,
demand for the  General  Display  Terminals  continues  to decline as  competing
technologies,  including Network Computers,  are gaining market share. For these
reasons,  sales of General Display  Terminals for 1997 are not expected to reach
the levels achieved in 1996.

The Company  believes  that there will be a  continuing  substantial  demand for
General  Display   Terminals.   The  Company  is  leveraging  its  manufacturing
expertise,  installed  customer base and  distribution  networks  while shifting
research and development to software and hardware  development that will deliver
Windows-based  applications,  as well as intranet and Java applications,  to the
desktop by means of Network Computers.

As a result  of the  Digital  Acquisition,  the  Company  has  expanded  its OEM
relationships  and worldwide  channels of distribution,  particularly in Europe.
The Company  reached  distribution  agreements  with  approximately  ten Western
European  distributors in 1997. Sales of VT and Dorio General Display  Terminals
have historically been  particularly  strong in Europe,  while sales of the ADDS
General Display Terminals have been stronger in the United States.

Sales of Network  Graphic  Displays  declined  $1,959 to $2,156 for the  quarter
ended March 31, 1997,  from $4,115 for the quarter  ended March 31,  1996.  This
decline  was  anticipated  and relates to specific  projects  undertaken  by NCR
during  1995,  and  completed  during  the first  quarter of 1996.  The  Company
believes  that sales of Network  Graphics  Displays  will continue to decline as
demand is satisfied by the more capable Network Computers.

Net revenues from the Company's repairs and spare parts business  decreased 45%,
or $864,  from  $1,920 for the  quarter  ended  March 31, 1996 to $1,056 for the
quarter  ended March 31,  1997.  The decline was due to reduced  spares sales to
NCR,  resulting  from a change in NCR's field  support  strategy  and  inventory
purchasing habits.

                                       8
<PAGE>

GAI  Partnership  royalties  for the quarter  ending March 31,  1997,  were $544
versus $661 in the corresponding  period of 1996. The GAI Partnership  agreement
provides  for the  payment  of  royalties  to the  Company  as a  percentage  of
partnership revenues,  commencing May 1995, as follows: months 1-12, 12%; months
13-24, 10%; months 25-36, 9%; months 37-48, 8%; and months 49-60, 7%.

IBM and NCR were the most  significant  customers  for the  Company's  products,
accounting  for 14.6% and 11%,  respectively,  of revenues for the quarter ended
March 31, 1997. Although both Digital and NCR are expected to remain significant
customers  for the  Company's  products,  neither is  expected  to  account  for
revenues  of the  Company  comparable  to 1996.  The loss of NCR or Digital as a
customer,  and as a  distribution  channel  for the  Company's  General  Display
Terminals,  would have a material  adverse  effect on the  Company's  results of
operations and liquidity.

Gross  margin - Gross  margin for the  quarter  ended  March 31, 1997 was $5,457
(22.8% of revenue),  as compared to gross margin for the quarter ended March 31,
1996 of $8,008 (21.3% of revenue).  The increase in gross margin as a percent of
revenue stems  primarily from cost  reductions  achieved in the VT and Dorio and
MultiConsole product lines;  offsetting declines in spare parts margin resulting
from the sale of spares to Digital under a parts  purchase  agreement  contained
within the Digital Acquisition.

In a continuing effort to maintain and improve margins in an industry  otherwise
characterized  by  commodity   pricing,   management  has  focused  on  quality,
flexibility,  and product cost reductions.  In addition,  sales of the Company's
Network  Computers,  which  carry  margins  greater  than  its  General  Display
Terminals,  are  expected  to  positively  impact the  Company's  gross  margin.
However,  there can be no assurance,  given the recent  introduction of this new
technology, that the Company's Network Computers will improve gross margin.

From time-to-time  margins are adversely  affected by industry  shortages of key
components.  The Company  emphasizes product and cost reductions in its research
and development activities and frequently reviews its supplier relationships for
the purpose of obtaining the best component prices available.

Total  Operating  Expenses - For the  quarter  ended March 31,  1997,  operating
expenses  were  $4,135  (17.2%  of  revenue),   compared  to  expenses  for  the
corresponding  quarter in 1996 of $5,220  (13.8% of  revenue).  As a result of a
reorganization  of the Company,  including a  reduction-in-force  affecting  130
employees at Boundless and the  discontinuation of operations at OTW, management
expects that  operating  expenses,  in amount and as a percent of revenue,  will
decline in 1997.

                                       9
<PAGE>

Sales and marketing expenses - Sales and marketing expenses decreased 18.2% from
$2,178 (5.8% of revenue) for the quarter ended March 31, 1996 to $1,782 (7.4% of
revenue) for the quarter ended March 31, 1997. The decline stems from reductions
in corporate  advertising and expenses  related to the integration of the VT and
Dorio product line into Boundless.

The Company uses direct mail,  telemarketing  and  cooperative  advertising  and
promotion to promote its  products.  The Company's  installed  user base of more
than 5,000,000 units is the primary target market for its new Network  Computer.
The  Company  believes  the most  effective  way to  reach  this  market  is via
cooperative  marketing with its channel partners and an aggressive use of public
relations.   Accordingly,   significant  direct  mail/telemarketing  and  public
relations  programs  are  planned  for  1997.  Additionally,  the  Company  will
participate in a limited number of highly targeted trade shows during 1997.

General  and  administrative  expenses  - General  and  administrative  expenses
decreased  from $1,743  (4.6% of  revenue),  to $1,629 (6.8% of revenue) for the
quarters ending March 31, 1996 and 1997,  respectively.  The decline is a result
of the reorganization,  previously discussed, as well as reductions in insurance
expense and amortization of goodwill.

Research and development  expenses - Research and development expenses decreased
from $1,299 (3.4% of revenue) in 1996 to $724,000 (3.0% of revenue) in 1996. The
decline stems from the reorganization, previously discussed, as well as one-time
expenses  incurred  during  1996 to  integrate  the VT and  Dorio  product  into
Boundless.

Research  and   development   expenses   were  expected  to  decline  due  to  a
consolidation  of research  activities  including  the closing of the  Company's
Orlando,  Florida,  facility.  Research and development expenses are shifting to
software and hardware development that will deliver user-friendly  Windows-based
and  Java  applications  to the  desktop  while  maintaining  current  cost  and
administrative  benefits of the shared resource multi-user  computing model. The
Company's  Network  Computers are designed to offer customers  simple,  easy and
cost-effective  access to  current  and  emerging  computing  environments  that
include  Windows NT, UNIX and Java  applications,  corporate  intranets  and the
Internet.  Since August 1996,  the Company has released  three Network  Computer
models,  and is expecting to release a second generation Network Computer in the
second quarter of 1997.

Other  expense - Other  expenses for the quarter  ended March 31, 1997 were $802
compared to $1,255 for the comparable  period in 1996.  Interest expense (net of
interest  income) amounted to $807 for the quarter ended March 31, 1997 compared
to $1,045 for 1996.  The decline was caused by the  provision  for  discontinued
operations in 1996 and the decline in outstanding debt.

Income  tax  expense - There is no  provision  for income  tax  expense  for the
quarter  ended March 31, 1997,  as compared to $410 for the quarter  ended March
31, 1996, due to net operating loss carryforwards  available  resulting from the
discontinuation of operations at OTW.

                                       10
<PAGE>

Loss from Discontinued  Operations - The Company recorded a loss relating to the
discontinuation  of  operations  at OTW of $762 for the quarter  ended March 31,
1996.  OTW had incurred  losses since  commencing  business in 1995 and consumed
significant  amounts of cash. The  discontinuation  of operations was a material
component of the Company's  reorganization and was intended to allow the Company
to focus its resources on its core business conducted at Boundless.

Net income - For the quarter ended March 31, 1997,  net income was $520 (2.1% of
revenue), compared to net income of $361 (0.9% of revenue) for the quarter ended
March 31, 1996. Despite an anticipated  decline in revenues in 1997, the Company
believes  that it will be  profitable  in 1997 as a result of its  restructuring
programs and introduction of its Network Computers.

Impact of Inflation - The Company has not been  adversely  affected by inflation
because technological advances and competition within the microcomputer industry
have  generally  caused prices of products  sold by the Company to decline.  The
Company has flexibility in its pricing and could, if necessary, pass along price
changes to most of its customers.

LIQUIDITY AND CAPITAL RESOURCES

The discussion  below regarding  liquidity and capital  resources should be read
together with the information  included in the Notes to  Consolidated  Financial
Statements.

Working capital was approximately $1,150 as of March 31, 1997. Historically, the
Company has relied on cash flow from  operations,  bank  borrowings and sales of
its common  stock to finance  its  working  capital,  capital  expenditures  and
acquisitions.

The  Company  is highly  leveraged.  As of March 31,  1997,  the  Company  had a
negative  tangible  net worth of $2,133 and total  liabilities  of $50,146.  The
Company's  cash  requirements  at  March  31,  1997  included  repayment  of the
remaining balance of $10,182,  plus interest,  of the term loan in six quarterly
installments;  repayment  of a revolving  loan of $13,950,  plus  interest,  due
September 1998;  repayment of an $8,000 note,  plus interest,  payable to NCR on
January 31,  1999;  payment of $3,555 to NCR if it exercises a put option at any
time in 1999; and annual payments to NCR of $498 in cash or the Company's Common
Stock.

Borrowing under the revolving loan is based on a borrowing base formula of up to
80% of eligible receivables, plus 50% of delineated eligible inventory, plus 30%
of  non-delineated  eligible  inventory.  Up to  $7,500 is  available  under the
revolving loan for letters of credit. As a result of the borrowing-base formula,
the credit  available to the Company could be adversely  restricted in the event
the Company's sales decline.

With the exception  that the Company will be required to refinance the NCR Note,
which is secured by a  mortgage  on the  Company's  Hauppauge  facility,  by its
January  31,  1999 due date,  the  Company  believes  that cash  generated  from
operations  and available  under the Chase Credit Line will be sufficient to pay
its other obligations as they become due. In the event there is a decline in the
Company's sales and earnings  and/or a decrease in availability  under the Chase
Credit Line, the Company's cash flow would be adversely  affected.  Accordingly,
the Company may not have the necessary cash to fund all of its obligations.

During 1996, the Company  violated  certain  covenants of the Chase Credit Line.
Prior to the fourth quarter 1996 covenant  violations,  Chase,  as agent for the
bank group,  had been  granting  waivers of these  covenant  violations  without
requiring  any material  change in the governing  documents.  As a result of the
fourth quarter  violations,  the Company entered into negotiations with the bank
group to revise  the  covenants  and to obtain a waiver  of the  fourth  quarter
violations.  During March 1997, the Company completed negotiations with the bank
syndicate  and obtained  both the  requested  revisions to the covenants and the
waiver of the fourth quarter  violations,  principally in exchange for a payment
of $500, representing  incremental interest at the default rate, by the Company.
While  the  Company  believes  it will  maintain  compliance  with  the  revised
covenants, there can be no assurance that it will be able to comply.

                                       11
<PAGE>

Net cash  provided by operating  activities  during the quarter  ended March 31,
1997 was $1,202. The amount consisted primarily of a reduction in inventories of
$2,571,  accounts  receivable  of  $7,082,  partially  offset by a  decrease  in
accounts  payable and accrued  expenses  of $9,018.  Net cash used in  investing
activities  was  comprised  of  capital  expenditures  of $53.  Net cash used in
financing  activities  was  principally  comprised of proceeds from  convertible
notes of $1,700 offset by payments on the term loan.

As of March 31, 1997,  the Company and Boundless had advanced  $10,263 to OTW as
intercompany  transfers.  Funding these cash requirements has adversely affected
liquidity  since  April  1995.  The  Company  will  not be  reimbursed  for  the
intercompany  transfers.  The Company  believes its liquidity  will improve as a
result of the discontinuation of operations at OTW.

In March 1997,  Microelectronics and Computer Technology Corporation (MCC), OTW,
the Company and SunRiver Group entered into  agreements  whereby all obligations
of the parties in connection  with the Technology  Agreement and the transfer of
the technology were discharged and OTW's  membership in MCC was terminated.  The
Company  paid MCC $500,  granted  MCC a  non-exclusive  license  to use  certain
technology  and  assigned  to a  designee  of MCC the  rights in the  Infosleuth
Project.  At the time of this  settlement,  MCC was owed $1,250 through December
31,  1997 and had  disputed  the  adequacy of the  delivery of 60,000  shares of
common stock to satisfy a $250 payment made in 1996.

FORWARD-LOOKING INFORMATION MAY PROVE INACCURATE

This Form 10-Q contains  forward-looking  statements  and  information  that are
based on  management's  beliefs as well as assumptions  made by and  information
currently  available  to  management.  When  used in this  document,  the  words
"anticipate,"  "believe,"  "estimate," and "expect," and similar expressions are
intended to identify  forward-looking  statements.  Such statements  reflect the
Company's current views with respect to future events and are subject to certain
risks,  uncertainties  and  assumptions,  including  the  specific  risk factors
described  in the  Company's  Form 10-K for the year ended  December  31,  1996.
Should  one or more of  these  risks or  uncertainties  materialize,  or  should
underlying assumptions prove incorrect,  actual results may vary materially from
those anticipated,  believed, estimated or expected. The Company does not intend
to update these forward-looking statements and information.

New Accounting Standards

In October 1995, the FASB issued  Statement  123,  "Accounting  for  Stock-Based
Compensation"  ("Statement 123"), which establishes fair value-based  accounting
and reporting  standards for all  transactions in which a company acquires goods
or services by issuing its equity  securities,  including all arrangements under
which employees receive stock based compensation.  Statement 123 encourages, but
does not  require,  employers  to  adopt  fair  value  accounting  to  recognize
compensation expense for grants under stock-based  compensation plans.  However,
companies  must comply with the disclosure  requirements  set forth in statement
123 which is effective for fiscal years  beginning  after December 31, 1995. The
Company adopted only the disclosure requirements of Statement 123 in 1996.


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In March 1995, the FASB issued Statement 121,  "Accounting for the Impairment of
Long-Lived  Assets and for  Long-Lived  Assets to be  Disposed  Of"  ("Statement
121"),  which addresses the accounting for the impairment of long-lived  assets,
certain identifiable intangibles and goodwill related to those assets to be held
and used. It also addresses the  accounting  for  long-lived  assets and certain
identifiable  intangibles to be disposed of. Statement 121 has an effective date
of January 1, 1996. The  application of Statement 121 had no significant  impact
upon the Company's financial statements.

In March 1997, the FASB issued Statement 128,  "Earnings Per Share"  ("Statement
128"), which requires a calculation of "Basic" and "Diluted" earnings per share.
Basic  earnings  per share  include no  dilution.  The  Company  does not expect
Statement 128 to have a significant  impact on its  calculation  of earnings per
share.

                          PART II - OTHER INFORMATION

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

On April 2, 1997,  shareholders  representing  26,439,380 shares  (approximately
52.9%) of the 50,016,629  shares of the Company's Common Stock,  outstanding and
in escrow pending conversion,  consented in writing to amending the Registrant's
Certificate of Incorporation, as follows:

o    to increase the total number of shares of Common Stock which the Registrant
     has authority to issue from 60,000,000 to 100,000,000; and

o    to change the name of the Company from  SunRiver  Corporation  to Boundless
     Corporation.

An  Information  Statement  relating to the foregoing was  distributed on May 5,
1997 to  stockholders  of record as of April 9, 1997,  as required by Regulation
14C under the  Securities  Exchange Act of 1934, and the amendments are expected
to become effective May 27, 1997.

Item 5.  Other Information 

Effective  March 18, 1997 Robert James was  appointed  President  and CEO of the
Company's wholly-owned Boundless Technologies, Inc. subsidiary. Mr. James is the
co-founder,  and was President and CEO until April 1997, of ABM Data Systems,  a
world leader in security software. Previously, he served as President and CEO of
Racal-Chubb Security Systems USA.

     Effective May 9, 1997, Leonard Mackenzie completed his six-month commitment
to the Company and  resigned  from his  position as  Director,  and Acting Chief
Executive  Officer and  President of the Company and from the Board of Directors
and all offices  held at all of its  subsidiaries.  J. Gerald  Combs was elected
Chairman and Chief Executive  Officer of the Company and its  subsidiaries.  Mr.
Combs has been the Chairman and CEO of SunRiver Group, the majority  shareholder
of the Company, since April 1997 and Chairman and CEO of Merrico Corporation,  a
privately  held financial  consulting  firm since 1992. He was also President of
All-Quotes, Inc., the predecessor of the Company, from 1993 to 1994.

The Company announced the sale of certain assets of its wholly owned subsidiary,
OTW, to CyberGuard  Corporation  for a combination of cash, a royalty on certain
future  revenues  and  the  assumption  of  certain  liabilities.   The  Company
previously  discontinued  the operations of this  subsidiary and took a one-time
charge in the  fourth  quarter  of 1996 to cover all costs  associated  with the
discontinuation. The sale will not have a material impact on the Company.

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Item 6.  Exhibits  and Reports on Form 8-K

(a) Exhibits

Exhibit 11:  Statement  Concerning  Computation  of Per Share Earnings is hereby
incorporated by reference to "Condensed  Consolidated  Statements of Operations"
of Part I- Financial  Information,  Item 1- Financial  Statements,  contained in
this Form 10-Q.

Exhibit 27:  Financial Data Schedule for the quarter ended March
31,  1997.

(b)  Reports on Form 8-K

1.   The Registrant  filed a report on Form 8-K dated January 7, 1997 related to
     the  resignation  of the  Company's  independent  accountant  under Item 4.
     Changes in Registrant's Certifying Accountant.

2.   The  Registrant  filed a report on Form 8-K dated March 14, 1997 related to
     the sale of  convertible  notes  under Item 9.  Sales of Equity  Securities
     Pursuant to Regulation S.


                                   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:  May 14, 1997



SunRiver Corporation

By:      /s/Wayne Schroeder
----------------------------------------
Wayne Schroeder
Vice President and Chief Financial Officer
(Principal Accounting and Financial Officer)

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