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, 1998
                                                 --------------


                         Commission File Number 0-17977





                              BOUNDLESS 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.)



                                100 Marcus Blvd.
                                  Hauppauge, NY

                    (Address of principal executive offices)



                                      11788
                                   (Zip Code)



                                 (516) 342-7400
              (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 April 10, 1998,  the  Registrant  had  approximately  5,139,228  shares of
Common Stock, $.01 par value per share outstanding.


                                        1
<PAGE>



                         PART I - FINANCIAL INFORMATION

Item 1.      Financial Statements

              INDEX TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS



Consolidated Balance Sheets as of March 31, 1998 (unaudited) and
   December 31, 1997.........................................................  3

Consolidated Statements of Operations (unaudited)
   for the three months ended March 31, 1998 and 1997........................  4

Consolidated Statements of Cash Flows (unaudited)
   for the three months ended March 31, 1998 and 1997........................  5

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



                                        2
<PAGE>

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



                                     ASSETS


<TABLE>
<CAPTION>
                                                                    March 31,      December 31,
                                                                      1998               1997
                                                                ------------------ -----------------
Current assets:                                                    (unaudited)

<S>                                                             <C>                <C>
   Cash and cash equivalents...................................        $    2,710         $   2,929
   Trade accounts receivable, net..............................            12,224            14,395
   Income tax refund...........................................               800               800
   Inventories.................................................            14,231            13,682
   Deferred income taxes.......................................             1,561             1,561
   Prepaid expenses and other current assets...................               595               711
                                                                ------------------ -----------------
      Total current assets.....................................            32,121            34,078
Property and equipment, net....................................            10,536            10,614
Goodwill, net..................................................             8,158             8,428
Other assets...................................................             1,211             1,428
                                                                ------------------ -----------------
                                                                      $    52,026        $   54,548
                                                                ================== =================

                      LIABILITIES AND STOCKHOLDERS' EQUITY

Current liabilities:
   Notes payable...............................................       $     9,000        $    7,650
   Current portion of long-term debt...........................             8,000             3,250
   Accounts payable............................................             7,437             8,840
   Accrued expenses............................................             5,476             5,378
   Deferred revenue............................................               108               180
                                                                ------------------ -----------------
      Total current liabilities................................            30,021            25,298
Long-term liabilities:
   Long-term debt, less current maturities.....................                 -             8,000
   Deferred income taxes.......................................             1,561             1,561
   Other ......................................................               860               727
                                                                ------------------ -----------------
      Total long-term liabilities..............................             2,421            10,288
                                                                ------------------ -----------------
      Total liabilities........................................            32,442            35,586
Commitments and contingencies..................................
Mandatorily redeemable preferred stock of subsidiary...........             3,555             3,555
Stockholders' equity:
   Preferred stock.............................................                 -                 -
   Common stock................................................                51                51
   Additional paid-in capital..................................            34,094            34,094
   Accumulated deficit.........................................          (18,116)          (18,738)
                                                                ------------------ -----------------
      Total stockholders' equity...............................            16,029            15,407
                                                                ------------------ -----------------
                                                                      $    52,026        $   54,548
                                                                ================== =================

See accompanying notes to condensed consolidated financial statements.

                                        3
</TABLE>
<PAGE>





                     BOUNDLESS CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                      (in thousands, except per share data)



<TABLE>
<CAPTION>
                                                        Three Months Ended
                                                             March 31,
                                                ------------------------------------
                                                       1998              1997
                                                ------------------ -----------------


                                                   (unaudited)       (unaudited)

<S>                                            <C>                 <C>
Revenue......................................          $   22,864          $ 23,924

Cost of revenue..............................              16,603            18,467
                                                ------------------ -----------------

           Gross margin......................               6,261             5,457

Operating expenses:

   Sales and marketing.......................               2,034             1,782

   General and administrative................               1,413             1,629

   Research and development..................                 868               724

   Other charges.............................                  71               (5)
                                                ------------------ -----------------

      Total operating expenses...............               4,386             4,130
                                                ------------------ -----------------

           Operating income..................               1,875             1,327

   Interest expense..........................                 671               807
                                                ------------------ -----------------

Income before income taxes                                  1,204               520

Income tax expense...........................                 459                 -
                                                ------------------ -----------------

Net income...................................                 745               520

Dividend on preferred stock of subsidiary....                 124               124
                                                ------------------ -----------------

Earnings available for common shareholders...   $             621  $            396
                                                ================== =================

Weighted average common shares outstanding...               5,139             4,863
                                                ================== =================

Basic earnings per common share..............   $            0.12  $           0.08

Weighted average dilutive shares outstanding.               5,163             4,935
                                                ================== =================

Diluted earnings per common share............   $            0.12  $           0.08
</TABLE>

See accompanying notes to condensed consolidated financial statements.

                                        4
<PAGE>



                     BOUNDLESS CORPORATION AND SUBSIDIARIES
                 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                          (dollar amounts in thousands)
                      For the Three Months Ended March 31,

                                   (unaudited)



<TABLE>
<CAPTION>
                                                                      1998         1997
                                                                   ----------- -------------
<S>                                                             <C>            <C>
Cash flows from operating activities:
   Net income................................................         $   745      $    520
   Adjustments to reconcile net income to net cash provided by
      (used in) operating activities:
      Depreciation and amortization..........................             809           790
      Loss from disposal of fixed assets......................             24             -
      Deferred revenues.......................................            (72)           50
      Provision for doubtful accounts.........................             24           118
      Provision for excess and obsolete inventory.............            477           422
   Changes in assets and liabilities:
      Trade accounts receivable...............................          2,146         7,082
      Inventories.............................................         (1,026)        2,571
      Other assets............................................             38        (1,333)
      Accounts payable and accrued expenses...................         (1,293)       (9,018)
                                                                   ----------- -------------
Net cash provided by operating activities.....................          1,872         1,202
                                                                   ----------- -------------
Cash flows from investing activities:
   Capital expenditures.......................................           (191)          (53)
                                                                   ----------- -------------
Cash flows from financing activities:
   Proceeds from issuance of common stock.....................              -             2
   Proceeds from debt issuance................................              -         1,700
   Payments on loans payable..................................         (1,900)       (3,200)
   Payments on capital leases.................................              -            (4)
                                                                   ----------- -------------
Net cash (used in) financing activities.......................         (1,900)       (1,502)
                                                                   ----------- -------------
Net (decrease) in cash and cash equivalents...................           (219)         (353)
Cash and cash equivalents at beginning of period..............          2,929         5,213
                                                                   ----------- -------------
Cash and cash equivalents at end of period....................        $ 2,710      $  4,860
                                                                   =========== =============
Non-cash transactions:
   Dividend on preferred stock of subsidiary..................        $   124      $    124
   Conversion of notes payable to common stock................              -           228
Cash paid for:
   Interest...................................................            347           293
   Taxes......................................................            125             6
</TABLE>

See accompanying notes to condensed consolidated financial statements.

                                        5
<PAGE>


                     BOUNDLESS 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, 1998 are not  necessarily  indicative of
the results  that may be expected  for the year ended  December  31,  1998.  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, 1997.

2.  Background

Boundless  Corporation  (the  "Company")  is engaged,  through  its  subsidiary,
Boundless  Technologies,  Inc.  ("Boundless"),  in designing  and  manufacturing
computer  terminals  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)  Windows(R)-based
Terminals  ("WBTs"),  sometimes  referred to as "thin clients",  and (iii) other
terminal   products  that  are  used  in  multi-user,   personal   computer  and
mini-computer-based  environments. The Company is a party to a royalty agreement
with 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.

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:

<TABLE>
<CAPTION>
                                                            March 31,                   December 31,
                                                               1998                         1997
                                                         ----------------            -------------------

<S>                                                      <C>                         <C>
Raw materials and purchased components..................      $   10,762                   $     10,723
Finished goods..........................................           3,060                          2,477
Demonstration equipment.................................              59                            135
Service parts...........................................             350                            347
                                                         ----------------            -------------------
                                                              $   14,231                   $     13,682
                                                         ================            ===================
</TABLE>

                                       6
<PAGE>


4.  Equity

At March 31, 1998 and December 31, 1997  stockholders'  equity  consisted of the
following:

<TABLE>
<CAPTION>
                                                              March 31,                   December 31,
                                                                 1998                         1997
                                                           ----------------            -------------------
<S>                                                        <C>                         <C>
Preferred stock, $0.01 par value, 1,000,000 shares
   authorized, none issued..............................        $        -                   $          -
Common stock, $0.01 par value, 25,000,000 shares
   authorized, 5,139,228 and 5,139,228 shares issued
   at March 31, 1998 and December 31,1997, respectively.                51                             51
Additional paid-in capital..............................            34,094                         34,094
Accumulated deficit.....................................          (18,116)                       (18,738)
                                                           ----------------            -------------------
   Total stockholders' equity...........................        $   16,029                   $     15,407
                                                           ================            ===================
</TABLE>

5.     Major Customers

The  Company  markets  its  terminal   products   through   original   equipment
manufacturers  ("OEMs") and reseller  distribution  channels.  Customers can buy
Boundless'  products  from an  international  network of  value-added  resellers
(VARs) and regional  distributors.  Through its sales force,  the Company  sells
directly  to  large  VARs and  regional  distributors  and  also  sells to major
national and international  distributors.  For the first quarter ended March 31,
1998 and 1997,  sales to two major OEMs as a percentage  of total  revenues were
21% and 26%, respectively.


6.     Business Segments

The  Company's  business is  concentrated  almost  entirely in one product area-
computer  terminals- which are sold throughout many diverse  markets.  It is not
possible,  therefore,  to divide the Company's business into meaningful industry
segments.

The  Company's  operations  are  worldwide  and  can  be  grouped  into  several
geographic  segments.  The Company's  manufacturing is conducted at its New York
facility  and  its  sales  force  operates  from  six  geographically  dispersed
locations in the United States and a European office in the Netherlands.  During
1997,  the Company  expanded its  marketing  efforts to include  South  America,
Asia-Pacific, Australia and New Zealand.



Pertinent  financial  data by major  geographic  segments for the first  quarter
ended March 31, 1998 and 1997 are:

<TABLE>
<CAPTION>
                                                                     March 31,            March 31,
                                                                        1998                 1997
                                                                 ----------------    ------------
<S>                                                             <C>                  <C>
Net sales to unaffiliated customers:
United States.................................................   $      15,714          $  16,149
Europe........................................................           5,955              6,389
Other foreign areas...........................................           1,195              1,386
                                                                 ================    ============
Net sales as reported in the accompanying income statement       $      22,864          $  23,924
                                                                 ================    ============
</TABLE>


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 are  approximate.  Dollar
amounts are stated in thousands.

                                       7
<PAGE>


First quarter of 1998 compared with first quarter of 1997
---------------------------------------------------------

Revenue - Revenue for the  quarter  ended March 31, 1998 was $22,864 as compared
to $23,924 for the quarter ended March 31, 1997.

Sales of the Company's General Display Terminals  declined 2% to $18,878 for the
quarter  ended March 31, 1998 from $19,226 for the quarter ended March 31, 1997.
The decline for the latest quarter is principally  attributable  to a decline of
$3,259  in sales to VT and Dorio  distributors,  offset  by  increased  sales of
$1,366 to Digital Equipment  Corporation  ("Digital") and $1,122 to customers of
Boundless'  ADDS(R)-branded  products. The VT and Dorio terminals are based on a
proprietary  architecture and, as a result, its users requiring  flexibility are
prone to more  quickly  move to  alternative  platforms.  Demand for the General
Display  Terminals  continues  to decline as competing  technologies,  including
WBTs, are gaining  market share.  For these  reasons,  sales of General  Display
Terminals for 1998 are not expected to reach the levels achieved in 1997.

Sales of the Company's WBT hardware and software, marketed under the trade names
Viewpoint(R) TC and Viewpoint(R) Administrator, respectively, amounted to $2,074
versus $140 for the periods  ended  March 31, 1998 and 1997,  respectively.  The
company is  targeting  the  approximately  35 million  users of General  Display
Terminals and Network Graphics Displays many of whom are currently transitioning
or intending to transition to graphical  applications that include Windows,  the
Intranet and Java. In addition, the Company is targeting the task-oriented users
of  older,  less  capable  PCs  that  are  unable  to  run  the  latest  Windows
applications,  including  those users in  business  and  education.  The Company
believes  its unique  ability to  customize  its  Viewpoint  TC products to meet
specific  end-customer needs will give it a sustainable  competitive  advantage.
Historically,  this  ability has been of great value to the  Company's  terminal
customers  and  the  Company   believes  that  this  strategy  will  be  equally
advantageous in the corporate thin client marketplace.

Revenues from the Company's  WBTs are expected to increase  during the third and
fourth  quarters of 1998 with the  availability  of new  Viewpoint TC models and
Viewpoint Administrator software and on the basis of the anticipated maturing of
the market for thin client devices in the third quarter of 1998, the versatility
of the  Company's new Viewpoint TC thin client  product  line,  the  significant
number of end-user  trials of the new products now in progress and the Company's
strong OEM relationships.

Sales of X Windows-based  Network Graphics  Displays declined $1,645 to $511 for
the quarter  ended March 31, 1998,  from $2,156 for the quarter  ended March 31,
1997.  Sales of the Company's  Network  Graphics  Displays have  generally  been
limited to a few large  telecommunications  customers. Due to the small customer
base,  the low  margins  associated  with  Network  Graphics  Displays,  and the
emergence  of WBTs,  the Company  announced a  discontinuation  of this  product
family in early 1998. As a result,  the Company recorded an inventory reserve of
$252 against a portion of the remaining Network Graphics Displays inventory.

Net revenue from the Company's  repairs and spare parts business  decreased 23%,
or $246,  to $810 for the  quarter  ended  March 31,  1998,  from $1,056 for the
quarter  ended March 31,  1997.  The decline was due to reduced  spares sales to
Digital,  resulting  from the  overall  decline in unit sales to Digital  during
1997. Due to new designs and engineering  changes  resulting in fewer components
and increased reliability, the Company does not anticipate that repair and spare
parts revenue will meet prior period levels.

The GAI  Partnership  agreement  provides  for the payment of  royalties  to the
Company as a percentage  of  partnership  revenues,  since 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%. GAI  Partnership  royalties  received for the quarter  ending
March 31, 1997, were $197. At March 31, 1998 the Company was owed $1,467 and had
not received required payments since June 1997. Discussions regarding payment of
the past due amount are ongoing.  During the fourth quarter of 1997, the Company
began to record GAI Partnership revenue only to the extent of cash received.

IBM was the most significant customer for the Company's products, accounting for
16% of revenue for the quarter  ended March 31, 1998.  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 1997
which  were 3% and 6%,  respectively.  The  loss  of IBM,  Digital,  or NCR as a
customer, and as a distribution channel for the Company's products, would have a
material adverse effect on the Company's results of operations and liquidity.

                                       8
<PAGE>

Gross Margin - Gross margin for the three months ended March 31, 1998 was $6,261
(27% of  revenue)  compared to gross  margin of $5,457 (23% of revenue)  for the
first  quarter of 1997.  Gross margin for the first  quarter of 1998  includes a
reserve of $252 established  against the  obsolescence  risk associated with the
Company's  announced  discontinuation  of its Network Graphics  Displays product
line. The increase in gross margin is attributable  to cost reductions  achieved
in the Company's  General Display Terminals and WBTs product lines. The increase
in gross margin as a percent of revenue stems primarily from cost reductions and
a more favorable  revenue mix between the Company's spare and repair business as
compared to the prior year.

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
WBTs,  which carry  margins  greater  than its General  Display  Terminals,  are
expected to positively impact the Company's gross margins. However, there can be
no assurance,  given the recent introduction of this new technology,  that sales
of the Company's WBTs will improve overall gross margins.

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

Total  Operating  Expenses - For the  quarter  ended March 31,  1998,  operating
expenses  were $4,386  (19% of  revenue),  compared  to  expenses  for the first
quarter of 1997 of $4,130 (17% of revenue).

Sales and  Marketing  Expenses - Sales and marketing  expenses  increased 14% to
$2,034 (9% of revenue)  for the quarter  ended March 31, 1998 from  $1,782(7% of
revenue)  for the  quarter  ended  March  31,  1997.  The  increase  stems  from
participation  in a number of important  tradeshows  during the first quarter of
1998 and increases in marketing expenses associated with the Company's WBTs.

The  Company  promotes  its  products  using  media  advertising,  direct  mail,
telemarketing,  public relations and cooperative channel marketing programs. The
Company's installed base of over five million units is the primary target market
for its new line of Viewpoint TC WBTs.  The Company's  plan to reach this market
is based on direct mail,  telemarketing and advertising and an aggressive public
relations  campaign,  including several domestic and international  press tours.
The  Company  will also  participate  in  several  key trade  shows  during  the
remainder of 1998.

General  and  Administrative  Expenses  - General  and  administrative  expenses
decreased to $1,413 (6% of  revenue),  from $1,629 (7% of revenue) for the three
months ended March 31, 1998 and 1997,  respectively.  The decline is a result of
reductions in legal expenses and depreciation.

Research and Development  Expenses - Research and  development  expenses for the
first quarter  increased 20% to $868 in 1998 from $724 in 1997.  The increase is
related to development  expenses associated with the Company's Viewpoint product
family.  Research and development  expenses are expected to exceed 1997 spending
levels due to investment in software for the Company's WBTs.

Interest  Expense - Interest  expense for the  quarter  ended March 31, 1998 was
$671 compared to $807 for the comparable  period in 1997. The decline is related
to the reduction in the amount of debt outstanding under the Company's revolving
credit facility and a decline in interest rates.

Income Tax  Expense - There was no  provision  for income  tax  expense  for the
quarter ended March 31, 1997 due to net operating loss  carryforwards  available
resulting  from the  discontinuation  of  operations  of  TradeWave.  Income tax
expense for the first quarter of 1998 was $459, or 38% of income before taxes.

Net Income - For the quarter  ended March 31,  1998,  net income was $745 (3% of
revenue), compared to $520 (2% of revenue) for 1997.

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.

                                        9
<PAGE>

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.

As of March 31, 1998,  the Company had working  capital of $2,100 as compared to
$8,780 at December 31, 1997. The decline stems from the  reclassification  of an
$8,000 note,  due January 31, 1999,  from  long-term  debt to  short-term  debt.
Historically,   the  Company  has  relied  on  cashflow  from  operations,  bank
borrowings and sales of its common stock to finance its working capital, capital
expenditures and  acquisitions.  As a result of positive cash flows, the Company
has reduced its outstanding  borrowings  under its revolving credit agreement by
$18,332 since December 1996.

The Company is highly leveraged.  As of March 31, 1998, the Company had tangible
net worth of  $6,856  and total  liabilities  of  $32,442.  The  Company's  cash
requirements  at March 31,  1998,  included  repayment  of a  revolving  loan of
$9,000,  plus  interest,  due December  1998;  payment 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,  until
such put option is exercised, 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
of further  declines in the  Company's  sales and increases in orders may not be
able to be financed under the Company's revolving credit line.

With the exception of the $8,000 NCR note, which is secured by a mortgage on the
Company's  Hauppauge  facility,  and which the Company  believes will have to be
refinanced  before its January 31, 1999 due date, the Company believes that cash
generated from  operations and available  under the Company's  revolving  credit
line will be sufficient to pay its  obligations  as they become due. The Company
anticipates that it will negotiate an extension of its current  revolving credit
line which  expires in  December  1998.  In the event  there is a decline in the
Company's sales and earnings and/or a decrease in availability  under the 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.

Net cash provided by operating  activities  for the three months ended March 31,
1998 was  $1,872;  due  principally  to net  income of $745,  non-cash  expenses
(principally  depreciation)  of $1,334 and  reductions in receivables of $2,146.
These increases in cash provided by operating  activities were partially  offset
by a decrease  in  payables  and  accrued  expenses of $1,293 and an increase in
inventories  of $1,026.  Net cash used in investing  activities was comprised of
capital  expenditures of $191. Net cash used in financing  activities was $1,900
to reduce the balance of the Company's term and revolving loans.

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,"  "expect," and, depending on the context,
"will,"  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, 1997. 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.

COMPLIANCE WITH YEAR 2000 ISSUE

Management  has  initiated  a Company  wide  program  to prepare  the  Company's
computer systems and applications for Year 2000 compliance.  The Company expects
to incur internal staff costs as well as other expenses necessary to prepare its
systems for the year 2000. The Company  expects to both replace some systems and
upgrade others.  Maintenance or modification costs will be expensed as incurred.
The total cost of this effort is still being  evaluated,  but is not expected to
be material to the Company.

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<PAGE>

NEW ACCOUNTING STANDARDS

Statement of Financial  Accounting Standards No. 129, "Disclosure of Information
about Capital Structure" ("SFAS No. 129") is effective for financial  statements
ending after December 15, 1997. The new standard  reinstates  various securities
disclosure  requirements  previously in effect under Accounting Principles Board
Opinion No. 15, which has been  superseded by SFAS No. 128. The Company does not
expect  adoption  of SFAS No.  129 to have a  material  effect,  if any,  on its
consolidated financial position or results of operations.

Statement of Financial  Accounting  Standards No. 130, "Reporting  Comprehensive
Income" ("SFAS No. 130") is effective for financial statements with fiscal years
beginning after December 15, 1997.  Earlier  application is permitted.  SFAS No.
130 establishes  standards for reporting and display of comprehensive income and
its  components  in a full  set of  general-purpose  financial  statements.  The
Company does not expect adoption of SFAS No. 130 to have a material  effect,  if
any, on its consolidated financial position or results of operations.

Statement of Financial  Accounting Standard No. 131,  "Disclosure about Segments
of an  Enterprise  and Related  Information"  ("SFAS No. 131") is effective  for
financial  statements  beginning  after  December  15,  1997.  The new  standard
requires that public  business  enterprises  report  certain  information  about
operating  segments in complete sets of financial  statements of the  enterprise
and in condensed financial statements of interim periods issued to stockholders.
It also requires that public  business  enterprises  report certain  information
about their products and services,  the  geographic  areas in which they operate
and their major customers. The Company will include information required by SFAS
No. 131 in the Notes to Consolidated Financial Statements.


Item 3.  Quantitative and Qualitative Disclosures About Market Risk

         None.



                           PART II - OTHER INFORMATION



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



As of January 2, 1998, stockholders owning 2,643,938  (approximately 51%) of the
5,139,228  (post-reverse split) outstanding shares of the Company's Common Stock
consented in writing to the following:

o    Amending  the  Company's  Certificate  of  Incorporation  (a) to  effect a
     one-for-ten  reverse split of the issued and  outstanding  shares of Common
     Stock, and (b) to decrease the total number of shares of Common Stock which
     the Company has authority to issue from 100,000,000 to 25,000,000; and

o    Approving the Company's 1997 Incentive Plan  permitting the grant of stock
     options, stock appreciation rights, performance shares, stock awards, stock
     units and incentive awards to employees, directors and others.

An  Information  Statement  relating to the  foregoing  stockholder  actions was
distributed on or about March 6, 1998 to  stockholders of record as of the close
of business on  December  31,  1997,  as  required by  Regulation  14C under the
Securities  Exchange Act of 1934,  and such actions became  effective  March 26,
1998.


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, 1998.

(b) Reports on Form 8-K - None

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<PAGE>



                                   SIGNATURES

Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
Registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.

Dated:  May 8, 1998







Boundless Corporation



By:      /s/Joseph Gardner
----------------------------------------
Joseph Gardner
Vice President and Chief Financial Officer
(Principal Accounting and Financial Officer)


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