UNITED
STATES


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, 2009





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





For the
transition period from ____________ to ____________





Commission
File Number:   333-103647





Prime Sun Power
Inc.


(Exact
Name of Registrant as Specified in its Charter)





Nevada
                
                98-0393197(State
      or other jurisdiction of
                
                (IRS
      Employerincorporation
      or organization)
                
                Identification
      No.)





100
Wall Street, 21st
Floor


New York,
NY  10005


(Address
of principal executive offices)





(866)
523-5551


(Registrant’s
Telephone Number, Including Area Code)





N/A


(Former
Name, Former Address and Former Fiscal Year,


if
Changed Since Last Report)





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 o





Indicate
by check mark whether the registrant has submitted electronically and posted on
its corporate Web site, if any, every Interactive Data File required to be
submitted and posted pursuant to Rule 405 of Regulation S-T (Sec.323.405 of this
chapter) during the preceding 12 months (or shorter period that the registrant
was required to submit and post such files).  Yes o   No o





Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company. See
the definitions of “large accelerated filer,” “accelerated filer” and “smaller
reporting company” in Rule 12b-2 of the Exchange Act. (Check one):





Large
      Accelerated Filer
             ̈
            Accelerated
      Filer
             ̈Non-Accelerated
      Filer
             ̈
            Smaller
      reporting company
            x




Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act).


Yes x No  ̈





As of
November 20, 2009, the Issuer had 40,114,900 shares of its Common Stock
outstanding.








TABLE
OF CONTENTS





PART
      I: FINANCIAL INFORMATION
              
              4Item
      1: Financial Statements
              
              4Item
      2: Management’s Discussion and Analysis of Financial Condition and Results
      of Operation
              
              12Item
      3: Quantitative and Qualitative Disclosures about Market
    Risk
              
              15Item
      4: Controls and Procedures
              
              15PART
      II: OTHER INFORMATION
              
              16Item
      1: Legal Proceedings
              
              16Item
      1A: Risk Factors
              
              16Item
      2: Unregistered Sales of Equity Securities and Use of
    Proceeds
              
              16Item
      3: Defaults Upon Senior Securities
              
              16Item
      4: Submission of Matters to a Vote of Security Holders
              
              16Item
      5: Other Information
              
              16Item
      6: Exhibits
              
              17SIGNATURES
              
              18





2





SPECIAL
NOTE REGARDING FORWARD-LOOKING STATEMENTS




The
following cautionary statements identify important factors that could cause our
actual results to differ materially from those projected in forward-looking
statements made in this Quarterly Report on Form 10-Q (this “Report”) and in
other reports and documents published by us from time to time. Any statements
about our beliefs, plans, objectives, expectations, assumptions, future events
or performance are not historical facts and may be forward-looking. These
statements are often, but not always, made through the use of words or phrases
such as “believes,” “will likely result,” “are expected to,” “will continue,”
“is anticipated,” “estimated,” “intend,” “plan,” “projection,” “outlook” and the
like, constitute “forward-looking statements” within the meaning of Section 27A
of the Securities Act of 1933, as amended, and Section 21E of the Securities
Exchange Act of 1934, as amended (the “Exchange Act”). However, as we issue
“penny stock,” as such term is defined in Rule 3a51-1 promulgated under the
Exchange Act, we are ineligible to rely on these safe harbor provisions. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
our Company to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. Given
these uncertainties, readers are cautioned to carefully read all “Risk Factors”
set forth under Item 1A and not to place undue reliance on any forward-looking
statements. We disclaim any obligation to update any such factors or to announce
publicly the results of any revisions of the forward-looking statements
contained or incorporated by reference herein to reflect future events or
developments, except as required by the Exchange Act. New factors emerge from
time to time, and it is not possible for us to predict which will arise or to
assess with any precision the impact of each factor on our business or the
extent to which any factor, or combination of factors, may cause actual results
to differ materially from those contained in any forward-looking
statements.





Unless
otherwise provided in this Report, references to the “Company,” the
“Registrant,” the “Issuer,” “we,” “us,” and “our” refer to Prime Sun Power Inc.
(formerly known as ATM Financial Corp.).


3





PART
I          FINANCIAL
INFORMATION


Prime
      Sun Power Inc.(A
      development stage company)Balance
      SheetsSeptember
      30,
              
              
              December
      31,2009
              
              
              2008(Unaudited)ASSETSCurrent
      AssetsCash
              
              $
              6
              
              
              $
              6,629Other
      AssetsLand
      Transfer Fees
              
              
              283,080Total
      Current Assets and Total Assets
              
              $
              283,086
              
              
              $
              6,629LIABILITIES
      AND STOCKHOLDERS' DEFICIENCYCurrent
      LiabilitiesAccounts
      payable and accrued liabilities
              
              $
              803,170
              
              
              $
              319,078Accrued
      Management Services - related party
              
              
              312,500Accrued
      Interest - related party
              
              
              41,204
              
              
              
              11,222Loan
      from shareholder
              
              
              836,732
              
              
              
              298,333Total
      Current Liabilities and Total Liabilities
              
              
              1,993,606
              
              
              
              628,633Stockholders'
      Equity (Deficiency):Common
      Stock, par value $.0001 per share100,000,000
      shares authorized,40,114,900
      shares issues and outstanding at
              
              
              4,011
              
              
              
              4,011September
      30, 2009 and December 31, 2008Additional
      paid in capital
              
              
              372,897
              
              
              
              222,418Deficit
      accumulated during development stage
              
              
              (2,087,428
              )
              
              
              (848,433
              )Total
      Stockholders' Deficiency
              
              
              (1,710,520
              )
              
              
              (622,004
              )Total
      Liabilities and Stockholders' Deficiency
              
              $
              283,086
              
              
              $
              6,629See
      Notes to Financial Statements
  4
  Prime
      Sun Power Inc.(A
      development stage company)(Unaudited)
      Statement of OperationsAccumulated
      fromFor
      the Three Months Ended
              
              For
      the Nine Months Ended
              
              
              December
      18, 2002September
      30
              
              
              September
      30
              
              
              (Date
      of Inception)2009
              
              
              2008
              
              
              2009
              
              
              2008
              
              
              to
      September 30, 2009Revenue
              
              
              —
              
              
              
              —
              
              
              
              
              
              
              
              
              
              —EXPENSES
      (INCOME)Consulting
      & Director Fees
              
              
              14,000
              
              
              
              11,750
              
              
              
              89,939
              
              
              
              15,750
              
              
              
              223,429Professional
      fees
              
              
              22,859
              
              
              
              20,168
              
              
              
              309,395
              
              
              
              138,047
              
              
              
              640,837Management
      Services - related party
              
              
              104,167
              
              
              
              
              
              
              
              312,500
              
              
              
              
              
              
              
              312,500Personnel
      Costs
              
              
              46,859
              
              
              
              52,216
              
              
              
              295,824
              
              
              
              116,051
              
              
              
              492,696General
      & Administrative
              
              
              3,854
              
              
              
              31,278
              
              
              
              50,876
              
              
              
              45,874
              
              
              
              186,474Interest
      expense
              
              
              15,584
              
              
              
              4,098
              
              
              
              29,982
              
              
              
              5,656
              
              
              
              42,230Gain
      on debt settlement
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (14,176
              )Non-cash
      compensation
              
              
              48,114
              
              
              
              —
              
              
              
              150,479
              
              
              
              
              
              
              
              203,438Total
      Expenses (Income)
              
              
              255,437
              
              
              
              119,510
              
              
              
              1,238,995
              
              
              
              321,378
              
              
              
              2,087,428Net
      Loss
              
              
              (255,437
              )
              
              
              (119,510
              )
              
              
              (1,238,995
              )
              
              
              (321,378
              )
              
              
              (2,087,428
              )Basic
      and Diluted Loss Per Share
              
              
              0.0064
              
              
              
              0.0030
              
              
              
              0.0309
              
              
              
              0.0080Weighted
      Average Shares Outstanding
              
              
              40,114,900
              
              
              
              40,114,900
              
              
              
              40,114,900
              
              
              
              40,114,900Share
      data has been adjusted to reflect the stock dividend effective February 4,
      2008See
      Notes to Financial Statements
 
 5
 
 Prime
      Sun Power Inc.(A
      development stage company)(Unaudited)
      Statement of Stockholders' EquityFor
      the Period from December 18, 2002 (Date of Inception) to September 30,
      2009
              
              
              DeficitAccumulatedDuring
      theCommon
      Stock
              
              
              Additional
              
              
              DevelopmentShares
              
              
              Par
              
              
              Paid-in
      Capital
              
              
              Stage
              
              
              TotalBalance
      - December 18, 2002
              
              
              #
              
              
              Value
      ($)
              
              
              ($)
              
              
              ($)
              
              
              ($)(Date
      of Inception)Common
      stock issued for cash at$0.0001
      per share
              
              
              28,000,000
              
              
              
              2,800
              
              
              
              (2,400
              )
              
              
              
              
              
              400Net
      loss for the period
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (21,990
              )
              
              
              (21,990
              )Balance
      - December 31, 2002
              
              
              28,000,000
              
              
              
              2,800
              
              
              
              (2,400
              )
              
              
              (21,990
              )
              
              
              (21,590
              )Net
      loss for the Year
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (24,216
              )
              
              
              (24,216
              )Balance
      - December 31, 2003
              
              
              28,000,000
              
              
              
              2,800
              
              
              
              (2,400
              )
              
              
              (46,206
              )
              
              
              (45,806
              )Net
      loss for the Year
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (13,398
              )
              
              
              (13,398
              )Balance
      - December 31, 2004
              
              
              28,000,000
              
              
              
              2,800
              
              
              
              (2,400
              )
              
              
              (59,604
              )
              
              
              (59,204
              )February
      14, 2005 - sharesissued
      for cash at $0.10 per share
              
              
              12,114,900
              
              
              
              1,211
              
              
              
              171,859
              
              
              
              
              
              
              
              173,070Net
      loss for the Year
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (18,609
              )
              
              
              (18,609
              )Balance
      - December 31, 2005
              
              
              40,114,900
              
              
              
              4,011
              
              
              
              169,459
              
              
              
              (78,213
              )
              
              
              95,257Net
      loss for the Year
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (16,167
              )
              
              
              (16,167
              )Balance
      - December 31, 2006
              
              
              40,114,900
              
              
              
              4,011
              
              
              
              169,459
              
              
              
              (94,380
              )
              
              
              79,090Net
      loss for the Year
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (56,129
              )
              
              
              (56,129
              )Balance
      - December 31, 2007
              
              
              40,114,900
              
              
              
              4,011
              
              
              
              169,459
              
              
              
              (150,509
              )
              
              
              22,961Non-cash
      compensation
              
              
              
              
              
              
              
              
              
              
              52,959
              
              
              
              
              
              
              
              52,959Net
      loss for the Year
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (697,924
              )
              
              
              (697,924
              )Balance
      - December 31, 2008
              
              
              40,114,900
              
              
              
              4,011
              
              
              
              222,418
              
              
              
              (848,433
              )
              
              
              (622,004
              )Non-cash
      compensation
              
              
              
              
              
              
              
              
              
              
              50,582
              
              
              
              
              
              
              
              50,582Net
      loss for the period
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (513,229
              )
              
              
              (513,229
              )Balance
      - March 31, 2009
              
              
              40,114,900
              
              
              
              4,011
              
              
              
              273,000
              
              
              
              (1,361,662
              )
              
              
              (1,084,651
              )Non-cash
      compensation
              
              
              
              
              
              
              
              
              
              
              51,783
              
              
              
              
              
              
              
              51,783Net
      loss for the period
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (470,329
              )
              
              
              (470,329
              )Balance
      - June 30, 2009
              
              
              40,114,900
              
              
              
              4,011
              
              
              
              324,783
              
              
              
              (1,831,991
              )
              
              
              (1,503,197
              )Non-cash
      compensation
              
              
              
              
              
              
              
              
              
              
              48,114
              
              
              
              
              
              
              
              48,114Net
      loss for the period
              
              
              
              
              
              
              
              
              
              
              
              
              
              
              (255,437
              )
              
              
              (255,437
              )Balance
      - September 30, 2009
              
              
              40,114,900
              
              
              
              4,011
              
              
              
              372,897
              
              
              
              (2,087,428
              )
              
              
              (1,710,520
              )See
      Notes to Financial Statements
  6
  Prime
      Sun Power Inc.(A
      development stage company)(Unaudited)
      Statement of Cash FlowAccumulated
      fromDecember
      18, 2002For
      the Nine Months ended
                  September
      30
                
                
                (Date
      ofInception)2009
                
                
                2008
                
                
                to
      September 30, 2009Operating
      ActivitesNet
      loss
                
                $
                (1,238,995
                )
                
                $
                (321,378
                )
                
                $
                (2,087,428
                )Adjustments
      to reconcile net loss to net cashused
      in operations:Non-cash
      compensation
                
                
                150,479
                
                
                
                4,237
                
                
                
                203,438Interest
      accrued to related party
                
                
                29,982
                
                
                
                —
                
                
                
                41,204Gain
      in debt settlement
                
                
                —
                
                
                
                —
                
                
                
                14,176Change
      in operating assests and liabilitiesAccounts
      payable and accrued liabilities
                
                
                484,092
                
                
                
                22,806
                
                
                
                803,170Accrued
      Management Services - related party
                
                
                312,500
                
                
                
                
                
                
                
                312,500Net
      Cash Used in Operating Activities
                
                
                (261,942
                )
                
                
                (294,335
                )
                
                
                (712,940
                )Investing
      ActivitiesLand
      Transfer Fees
                
                
                (283,080
                )
                
                
                —
                
                
                
                (283,080
                )Net
      Cash Used in Investing Activities
                
                
                (283,080
                )
                
                
                —
                
                
                
                (283,080
                )Financing
      ActivitiesProceeds
      of Loans from Shareholder
                
                
                538,399
                
                
                
                245,758
                
                
                
                836,732Gain
      in debt settlement
                
                
                —
                
                
                
                —
                
                
                
                (14,176
                )Common
      stock issued
                
                
                —
                
                
                
                —
                
                
                
                173,470Net
      Cash Provided by (Used in) Financing Activities
                
                
                538,399
                
                
                
                245,758
                
                
                
                996,026Increase
      (Decrease) in Cash
                
                
                (6,623
                )
                
                
                (48,577
                )
                
                
                6Cash
      - Beginning of Period
                
                
                6,629
                
                
                
                71,241
                
                
                
                —Cash
      - End of Period
                
                $
                6
                
                
                $
                22,664
                
                
                $
                6See
      Notes to Financial Statements
  7
 PRIME
SUN POWER INC.
 (A
Development Stage Company)
 
 NOTES TO
FINANCIAL STATEMENTS
 
 SEPTEMBER
30, 2009
 
 1.            BASIS OF
PRESENTATION
 
 The
accompanying unaudited financial statements have been prepared in accordance
with accounting principles generally accepted for interim financial information
and with the instructions to Form 10-Q and Article 8 of Regulation S-X relating
to smaller reporting companies.  Accordingly, they do not include all
of the information and footnotes required by generally accepted accounting
principles (“GAAP”) for complete financial statements.  In the opinion
of management, all adjustments (consisting of normal recurring accruals)
considered necessary for a fair presentation have been
included.  Operating results for the nine
and three month period ended September 30, 2009 are not necessarily
indicative of the results that may be expected for the year ended December 31,
2009.
 
 The
balance sheet at December 31, 2008 has been derived from the audited financial
statements at that date but does not include all of the information and
footnotes required by GAAP for complete financial statements.
 
 For
further information, refer to the consolidated financial statements and
footnotes thereto included in our Annual Report on Form 10-K for the year ended
December 31, 2008.
 
 2.            BUSINESS
DESCRIPTION
 
 Organization
and Business Description
 
 Prime Sun
Power Inc. (the “Company”) was incorporated in the State of Nevada on December
18, 2002 and is a development stage company. On January 10, 2008, a change of
control of the Company occurred and Rudana Investment Group AG, (“Rudana”) a
corporation formed under the laws of Switzerland, became the new majority
shareholder of the Company (“Rudana”), controlling approximately 70% of the
issued and outstanding shares of the Company’s common stock.  On April
1, 2008, we changed our name from ATM Financial Corp. to Prime Sun Power
Inc.  The Company plans to pursue a business model producing solar
generated electrical power and other alternative renewable
energies.
 
 Going
Concern
 
 The
Company has been in the development stage since its inception and has not yet
realized any revenues from its planned operations.  As shown in the
accompanying financial statements, the Company has incurred a net loss of
$2,087,428 for the period from inception (December 18, 2002) to September 30,
2009, has a working capital deficiency of $1,993,600 and has not generated any
revenue. These factors, among others, raise substantial doubt as to the
Company’s ability to continue as a going concern and to emerge from the
development stage is dependent upon, among other things, its successful
execution of its plan of operations and ability to raise additional financing or
capital.  There is no guarantee that the Company will be able to raise
additional financing capital or sell any of services or products at a
profit.  These factors, among others, raise substantial doubt
regarding the Company’s ability to continue as a going concern. The accompanying
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.
  8
  3.            SIGNIFICANT ACCOUNTING
POLICIES
 
 Use
of estimates
 
 The
preparation of financial statements in conformity with U.S. generally accepted
accounting principles requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and disclosure of
contingent assets and liabilities at the date of the financial statements and
the reported amounts of revenues and expenses during the reporting
period.  The actual results experienced by the Company may differ
materially from the Company’s estimates.  To the extent there are
material differences between the estimates and the actual results, future
results of operations will be affected and the effect could be
material.
 
 Financial
instruments
 
 The
Company’s financial instruments consist of cash and cash equivalents, accounts
payable and accrued liabilities.
 
 The fair
value of these financial instruments approximates their carrying
values.
 
 Cash
and Cash equivalents
 
 The
Company considers all highly liquid instruments with a maturity of three months
or less at the time of issuance to be cash equivalents.
 
 The
Company maintains cash balances at various financial
institutions.  Accounts at each institution are insured by the Federal
Deposit Insurance Corporation up to $250,000.  The Company’s accounts
at these institutions may, at times, exceed the Federally insured
limits.  The Company has not experienced any losses in such
accounts.
  Income
taxes
 
 The
Company accounts for income taxes in accordance with authoritative guidance
issued by the Financial Accounting Standards Board which requires that
deferred tax assets and liabilities be recognized for future tax consequences
attributable to differences between financial statement carrying amounts of
existing assets and liabilities and their respective tax bases. Recognition of
future tax benefits, such as carry forwards, to the extent that realization of
such benefits is more likely than not and that a valuation allowance be provided
when it is more likely than not that some portion of the deferred tax asset will
not be realized.
 
 Impairment
of long-lived assets
 
 The
Company reviews its long-lived assets for impairment whenever events or changes
in circumstances indicate that the carrying amount of the assets may not be
fully recoverable. To determine if impairment exists, the Company compares the
estimated future undiscounted cash flows from the related long-lived assets to
the net carrying amount of such assets. Once it has been determined that
impairment exists, the carrying value of the asset is adjusted to the fair
value. Factors considered in the determination of the fair value include current
operating results, trends and the present value of estimated expected future
cash flows.
  9
  Stock
based compensation
 
 The
Company accounts for stock based compensation in accordance with the
guidance issued by the Financial Accounting Standards Board, which requires
the Company to expense stock options based on grant date fair value in its
financial statements. Further, the guidance requires additional accounting
relating to the income tax effects and additional disclosures regarding the cash
flow effects resulting from share-based payment arrangements.
  Recent Accounting
Pronouncements –
 
 In
December 2007, FASB issued guidance related to Business Combinations under
ASC 805, Business Combinations, and guidance related to the accounting and
reporting of noncontrolling interest under ASC 810-10-65-1, Consolidation. This guidance
significantly changes the accounting for and reporting of business combination
transactions and noncontrolling (minority) interests in consolidated financial
statements. This guidance became effective January 1, 2009.
 
 In March
2008, the FASB issued guidance related to the disclosures about derivative
instruments and hedging activities under
FASB ASC 815-10-50, Derivatives and Hedging. This guidance requires companies to
provide enhanced disclosures about (a) how and why they use derivative
instruments, (b) how derivative instruments and related hedged items are
accounted for under applicable guidance, and (c) how derivative
instruments and related hedged items affect a company's financial position,
financial performance, and cash flows.These disclosure
requirements are effective for financial statements issued for fiscal years and
interim periods beginning after November 15, 2008.Our adoption of ASC 815-10-50 on January 1,
2009 did not have a material impact on our consolidated condensed financial
statements.
 
 In June
2008, the FASB issued guidance to evaluate whether an instrument (or embedded
feature) is indexed to an entity’s own stock under ASC 815-40-15, Derivatives and Hedging. The
guidance requires entities to evaluate whether an equity-linked financial
instrument (or embedded feature) is indexed to its own stock in order to
determine if the instrument should be accounted for as a derivative under the
scope of ASC 815-10-15. This guidance is effective for financial statements
issued for fiscal years beginning after December 15, 2008 and interim periods
within those fiscal years. We adopted ASC 815-40-15 beginning January 1,
2009.  We applied this guidance to the conversion feature in our
Series M Convertible Preferred Stock (“Series M Preferred”).
 
 In
November 2008, the FASB issued guidance related to accounting considerations for
equity method investments under ASC 323-10-35, Investments – Equity Method and
Joint Ventures. This guidance states that an equity method investor shall
account for a share issuance by an investee as if the investor had sold a
proportionate share of its investment. Any gain or loss to the investor
resulting from an investee's share issuance should be recognized in earnings.
Previous to this, changes in equity for both issuances and repurchases were
recognized in equity. This guidance is effective for financial statements issued
for fiscal years beginning after December 15, 2008 and interim periods within
those fiscal years. We adopted ASC 323-10-35 beginning January 1,
2009.
 
 In May
2009, the FASB issued guidance related to subsequent events under ASC 855-10,
Subsequent Events. This
guidance sets forth the period after the balance sheet date during which
management or a reporting entity should evaluate events or transactions that may
occur for potential recognition or disclosure, the circumstances under which an
entity should recognize events or transactions occurring after the balance sheet
date, and the disclosures that an entity should make about events or
transactions that occurred after the balance sheet date. It requires disclosure
of the date through which an entity has evaluated subsequent events and the
basis for that date, whether that date represents the date the financial
statements were issued or were available to be issued. This guidance is
effective for interim and annual periods ending after June 15, 2009. We adopted
ASC 855-10 beginning June 30, 2009 and have included the required disclosures in
our consolidated condensed financial statements.
 
 In June
2009, the FASB issued an amendment to ASC 810-10, Consolidation. This guidance
amends ASC 810-10-15 to replace the quantitative-based risks and rewards
calculation for determining which enterprise has a controlling financial
interest in a VIE with a primarily qualitative approach focused on identifying
which enterprise has the power to direct the activities of a VIE that most
significantly impact the entity’s economic performance. It also requires ongoing
assessments of whether an enterprise is the primary beneficiary of a VIE and
requires additional disclosures about an enterprise’s involvement in VIEs. This
guidance is effective as of the beginning of the reporting entity’s first annual
reporting period that begins after November 15, 2009 and earlier adoption is not
permitted. We are currently evaluating the potential impact, if any, of the
adoption of this guidance will have on our consolidated condensed financial
statements.
 
 In June
2009, the FASB issued Accounting Standards Update No. 2009-01 which amends ASC
105, Generally Accepted
Accounting Principles. This guidance states that the ASC will become the
source of authoritative U.S. GAAP recognized by the FASB to be applied by
nongovernmental entities. Once effective, the Codification’s content will carry
the same level of authority. Thus, the U.S. GAAP hierarchy will be modified to
include only two levels of U.S. GAAP: authoritative and non-authoritative. This
is effective for financial statements issued for interim and annual periods
ending after September 15, 2009. We adopted ASC 105 as of September 30,
2009 and thus have incorporated the new Codification citations in place of the
corresponding references to legacy accounting pronouncements.
 
 In August
2009, the FASB issued Accounting Standards Update No. 2009-05, Measuring Liabilities at Fair Value,which amendsASC 820,Fair Value Measurements and
Disclosures. This Update provides clarification that in circumstances in
which a quoted price in an active market for the identical liability is not
available, a reporting entity is required to measure the fair value using one or
more of the following techniques: a valuation technique that uses the quoted
price of the identical liability or similar liabilities when traded as an asset,
which would be considered a Level 1 input, or another valuation technique that
is consistent with ASC 820. This Update is effective for the first reporting
period (including interim periods) beginning after issuance. Thus, we adopted
this guidance as of September 30, 2009, which did not have a material impact on
our consolidated condensed financial statements.
  10
  4.            STOCKHOLDERS’
EQUITY
 
 On
January 22, 2008, the Board of Directors declared the payment of a stock
dividend to the stockholders of record of the Company as of February 4,
2008.  The stock dividend was paid on February 4,
2008.  Each stockholder received six additional shares of the
Company’s common stock for each one share of the Company’s common stock which
they held on the record date.  Following the payment of the stock
dividend, the issued and outstanding share ownership of the Company increased
from 5,730,700 shares of Company common stock to 40,114,900 shares of common
stock.  The statement of Stockholders’ Equity and per share amounts
have been retroactively adjusted to reflect the historical impact of the stock
dividend.
 
 Effective
as of June 19, 2009, the option previously granted to Mr. Frank Juergens on
January 7, 2009 for the purchase of 50,000 shares of the Company’s common stock
terminated effective upon the resignation of Mr.
Juergens.
 
 5.            RELATED PARTY
TRANSACTIONS
  Transactions
Involving Rudana Investment Group AG
 
 At
September 30, 2009, Rudana, the Company’s majority shareholder, had loaned the
Company a total of $836,732. The funds were used by the Company for general
corporate use.  These loans bear interest at 7.5% per annum and are
due thirty (30) days after demand.
 
 The
Company accrued interest of $41,204 as of September 30, 2009 which is included
in accounts payable and accrued liabilities on the accompanying balance sheet.
Interest expense to Rudana was $29,982 and $15,584 for the nine and three months
ended September 30, 2009.
  Transactions
Involving Prime Asset Finance Ltd.
 
 The
Company has entered into an agreement with Prime Asset Finance Ltd. (“PAF”), a
UK company which is a wholly owned subsidiary of Rudana Investment Group AG, our
majority controlling shareholder.  Under the terms of the agreement,
PAF will assist and advise us on developing strategic plans for inception of
operations, preparing acquisition growth plans, identifying potential
acquisition candidates, initiating discussion with potential acquisition
candidates and strategic alliance partners, analyzing the financial implications
of potential acquisitions and strategic alliances; negotiating terms and
conditions of transactions and strategic alliances; outlining and managing the
due diligence process; developing strategies to maximize revenue and corporate
value including growth through sales, utilizing alternative distribution
channels and enhancing marketing programs and providing support for investor
relations programs.  We have agreed to pay an initial services fee of
$350,000 to PAF as of January 1, 2009 and will continue to pay management
services fees of $25,000 per month in respect of the management
services.  All of the management fees have accrued to date and have
not yet been paid. In addition, PAF will be compensated in the amount of 8% of
the total transaction value of any company acquired by us by merger or
acquisition.
 6.            OFFICER TRANSITIONS
 
 Effective
as of August 4, 2009, Dr. Augustine Fou has resigned as a member of the Board of
Directors of the Company.  Dr. Fou did not expressed any disagreement
with the Company on any matter relating to the Company’s operations, policies or
practices.
 
 7.            SUBSEQUENT EVENTS
 
 Effective
as of November 9, 2009, each of Mr. Bruno Colle and Mr. Roberto Gerbo resigned
as a member of the Company’s Board of Directors.  Effective as of such
date, each of these individuals have joined by Compnay’s Advisory
Committee.  Members of the Company’s Advisory Committee will assist
the Company’s officers and directors on an as-needed basis.
 
 Effective
as of November 9, 2009, Dr. Cesare Boffa has resigned as a member of the
Company’s Board of Directors.  Effective as of such date, Dr. Boffas
has joined the Company’s Advisory Committee.  Dr. Boffa has also
resigned as the Company’s Chief Technology Officer.  He will continue
to serve the Company as a consultant.
 
 Effective
as of November 9, 2009, Ms. Barbara Salz resigned as the Company’s Corporate
Secretary.


11




ITEM 2.
            MANAGEMENT'S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION ANDRESULTS
      OFOPERATIONS





The
Company's Operations





The
following discussion of the financial condition and results of operations of
Prime Sun Power Inc. should be read in conjunction with the financial statements
and the related notes thereto included elsewhere in this Report. This Report
contains certain forward-looking statements and the Company's future operating
results could differ materially from those discussed herein. Certain statements
contained in this Report, including, without limitation, statements containing
the words “believes”, “anticipates,” “expects” and the like, constitute
“forward-looking statements” within the meaning of Section 27A of the Securities
Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934,
as amended (the “Exchange Act”). However, as the Company intends to issue “penny
stock,” as such term is defined in Rule 3a51-1 promulgated under the Exchange
Act, the Company is ineligible to rely on these safe harbor provisions. Such
forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
the Company to be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements. Given
these uncertainties, readers are cautioned not to place undue reliance on such
forward-looking statements. The Company disclaims any obligation to update any
such factors or to announce publicly the results of any revisions of the
forward-looking statements contained or incorporated by reference herein to
reflect future events or developments, except as required by the Exchange
Act.





We were
incorporated in the State of Nevada on December 18, 2002, as ATM Financial
Corp.  On April 1, 2008, we changed our name from “ATM Financial
Corp.” to “Prime Sun Power Inc.”  On April 15, 2008, the Company
changed its stock symbol from “AFIC” to “PSPW.” The Company’s common stock is
traded on the National Association of Securities Dealers Inc.’s over-the-counter
bulletin board.





The
Company address is 100 Wall Street, 21st Floor,
New York, NY 10005.  The Company’s telephone number is
866-523-5551.





Plan
of Operation





As of the
date hereof, the Company has not yet commenced its operations.  The
Company is in the advanced stage of business plan development. We have
formulated our general business plan of operating as a utility producing
electrical power by means of renewable and clean energy sources, such as wind
and Photovoltaic (PV) Solar.  We intend to develop, install and
operate power plants in Europe. We anticipate starting our first operational
activity in Italy during 2010.





On April
15, 2009, the Company entered into four agreements to obtain licenses and land
lease call option rights for the development of certain photovoltaic power plant
projects in Italy.  These agreements included two Transfer Agreements:
one for a project located in San Paolo, Italy (referred to herein as “Project
San Paolo”) and one for a project located in Foggia/Apricena, Italy (referred to
herein as “Project Puglia” and together with Project San Paolo, the
“Projects”).  Both of the Projects are located in the Puglia region of
Italy.





Pursuant
to the Transfer Agreements for the Projects, the Company expects to acquire
option contracts from another party (referred to herein as the “Transferor”), as
acquired from various landlords. Subject to the receipt of required government
permits, the Company expects to acquire or lease certain land at specified
prices for the purpose of constructing and installing photovoltaic
plants.  The Transferor is expected to assist the Company to apply for
certain key licenses.  The Company will pay the Transferor certain
transaction fees upon the performance of certain conditions by the
Transferor.





The
Projects are expected to collectively cover a total installed capacity of up to
83 MW (megawatts).  The acquisition of the licenses and the land lease
call option rights are expected to be an important step for the Company in its
goals to develop and manage photovoltaic plant projects in Italy.  The
Company is in discussion with the municipality of San Paolo for the development
of further photovoltaic plants.





In
addition, the Company has entered into two Advisory Agreements, one for each of
Project San Paolo and Project Puglia.  Pursuant to these agreements, a
local advisor will assist the Company in the development of each of the
Projects.  The Company will pay the advisor certain success fees
related to the aggregate building and installing costs of the PV Plants upon the
achievement of certain milestones.





The
Company will endeavor to secure the remaining governmental authorizations for
these projects in the fourth quarter of 2009.  We are currently in
discussions regarding the financing of these projects, the assignment of an
Engineering, Procurement and Construction (EPC) contractor, and the sourcing of
solar modules.


12





For our
Italian operational activities we intend to establish an Italian
subsidiary.  We may allocate some portion of the capital of this
subsidiary to strategic investors to assist the Company’s growth and
development.





As of the
date of this Report, we have not commenced any commercial activities or revenue
generating operations. As of the date of this Report, payments are required
under the Transfer Agreements related to Project San Paolo and Project
Puglia.  The payments due include fees of 200,000 Euros (approximately
$300,000) for the commencement of the Transfer Agreement for Project San Paolo
and 250,000 Euros (approximately $375,000) for the commencement of the Transfer
Agreement for Project Puglia.  To date, we have only paid 100,000
Euros towards each of the two payments required under the Transfer Agreements
related to Project San Paolo and Project Puglia. The Company made these two
payments of 100,000 Euros each on July 1, 2009.  We are currently
negotiating extensions to the dates of performance of payment pursuant to such
agreements and a waiver of interim non-performance in order to proceed with
these projects.  The Company does not currently have sufficient cash
or financing available to perform the agreements.  If we are not able
to arrange a waiver and extension of the payments due under the agreements and
raise sufficient funds to cover the payments, the Company will not be able to
proceed with these projects.





The
continuing development of our plans are subject to many uncertainties that
present material risks to investors. Shareholders of the Company and prospective
investors are directed to the Risk Factors discussed in our most recent Annual
Report on Form 10-K as filed with the U.S. Securities & Exchange Commission
which is publicly available at www.sec.gov
..





Revenues





During
the three and nine month periods ended September 30, 2009 and September 30,
2008, the Company had no revenues from operations.





Results
of Operations





We have
not yet commenced operations.  As of September 30, 2009, our Company
had no operations, no revenues and substantially no assets.  The
Company has incurred a significant increase in expenses during this reporting
period from the last comparative period.  Expenses for the three
months ended September 30, 2009 were $255,437, as compared to $119,510 for the
three months ended September 30, 2008.  Expenses for the nine months
ended September 30, 2009 were $1,238,995, as compared to $321,378 for the nine
months ended September 30, 2008.  The increased expenses are related
to the legal and due diligence fees regarding the four agreements to obtain
licenses and land lease call option rights for the development of certain
photovoltaic power plant projects in Italy.  During the last
comparative period the Company had minimal personnel requirements.





The
Company’s professional fees for the three month period ended September 30, 2009
were $127,026, as opposed to $20,168 for the three month period ended September
30, 2008.  Personnel costs were $46,859 for the period ended September
30, 2009, as opposed to $52,216 for the three month period ended September 30,
2008.  General and administrative expenses decreased to $3,854 for the
three month period ended September 30, 2009 from $31,278 for the three month
period ended September 30, 2008.




The
Company’s professional fees for the nine month period ended September 30, 2009
were $309,395, as opposed to $138,047 for the nine month period ended September
30, 2008.  Personnel costs were $295,824 for the period ended
September 30, 2009, as opposed to $116,051 for the nine month period ended
September 30, 2008.  General and administrative expenses increased to
$50,876 for the nine month period ended September 30, 2009 from $45,874 for the
nine month period ended September 30, 2008.  The Company’s consulting &
director fees for the nine month period ended September 30, 2009 were $89,939,
as opposed to $15,750 for the nine month period ended September 30,
2008.





From the
inception of the Company through September 30, 2009, the Company has accumulated
total expenses and total losses of $2,087,428. From the inception of the Company
through September 30, 2009, the Company’s expenses have included $223,429 on
consulting and director fees, $640,837 on professional fees, $312,500 on
management services, $492,696 on personnel costs, and $186,474 on general and
administrative fees.





Liquidity
and capital resources





As of the
date of this Report, we have not yet generated any revenues from our business
operations.  Since inception, the Company has incurred total expenses
of $2,087,428, including total expenses of $255,437 during the three months
ended September 30, 2009 and $1,238,995 during the nine months ended September
30, 2009.





Our
consolidated cash balance at September 30, 2009 was $6.  As of
September 30, 2009, our total assets were $283,086 and our total liabilities
were $1,993,606.  Cash declined from $6,629 as of December 31, 2008,
total assets increased from $6,629 as of December 31, 2008 and total liabilities
increased from $628,633 as of December 31, 2008.





During
the three months ended September 30, 2009 and through the date of this Report,
our primary source of capital has been loans from Rudana Investment Group AG,
the majority shareholder of our Company.  Our pre-operational
activities to date have consumed substantial amounts of cash.  Our
negative cash flow from operations is expected to continue and to accelerate in
the foreseeable future as the Company invests in capital expenditures to
commence operations.





To date,
the Company has received loans in aggregate of $836,732 from Rudana (the
“Shareholder Loans”). The Company has used the proceeds from the Shareholder
Loans for general corporate purposes. The Shareholder Loans have an interest
rate of seven and a half percent (7.5%) per annum, which together with the
principal amount shall be repayable thirty (30) days after demand by Rudana. In
connection with the Shareholder Loans, the Company executed notes setting forth
the terms thereof.


13





As of the
date of this Report, we have not commenced any commercial activities or revenue
generating operations. As of the date of this Report, payments are required
under the Transfer Agreements related to Project San Paolo and Project
Puglia.  The payments due include fees of 200,000 Euros (approximately
$300,000) for the commencement of the Transfer Agreement for Project San Paolo
and 250,000 Euros (approximately $375,000) for the commencement of the Transfer
Agreement for Project Puglia.  To date, we have only paid 100,000
Euros towards each of the two payments required under the Transfer Agreements
related to Project San Paolo and Project Puglia. The Company made these two
payments of 100,000 Euros each on July 1, 2009.  We are currently
negotiating extensions to the dates of performance of payment pursuant to such
agreements and a waiver of interim non-performance in order to proceed with
these projects.  The Company does not currently have sufficient cash
or financing available to perform the agreements.  If we are not able
to arrange a waiver and extension of the payments due under the agreements and
raise sufficient funds to cover the payments, the Company will not be able to
proceed with these projects.  Once these projects commence, the
Company will be required to pay substantial, and currently undetermined, amounts
to complete construction.





On May
10, 2008, we entered into an agreement with Synergy Investments & Finance
Holding Limited (“Synergy”) formerly known as Arimathea Limited, to assist us to
raise capital.  In consideration for assisting us in the raising of
equity and debt capital, we have entered into a warrant agreement with Synergy
which, as amended, will have an exercise term of three years and will become
exercisable for the purchase of a number of our shares of common stock equal to
(i) 5% of the amount of capital raised by the Company made by Synergy, divided
by (ii) the original exercise price of $1.62 per share. All other terms and
conditions of the First Warrant and Second Warrant as amalgamated into the
Amended Warrant shall remain the same. The Synergy Warrant does not contain any
call provisions and there is no obligation on the part of Synergy to exercise
its warrant at any time. As a result of the contingent nature of the vesting of
the Synergy Warrant, no expense has been recognized.  We cannot
guarantee that Synergy will be successful in assisting us to raise capital for
our operations.  As of the date of this Report, no financing warrants
under the Amended Warrant have been issued to Synergy and no firm commitments
have been made by Synergy with respect to financing.





We will
need to raise additional capital to implement our new business plan and continue
operations.  We are discussing our capital requirements with
alternative sources of financing, and assessing private placements of securities
and loans from our shareholders.





Plant
and Equipment





We expect
to start investing in the installation of solar parks in Italy during 2010.
There will be significant investments required to start these development
projects in Italy. These investments are expected to be financed through
additional equity capital as well as financing loans.





Employees




As of the
end of the period covered by this Report, the Company had four employees:
Olivier de Vergnies, who served as our Acting Chief Executive Officer and Acting
Chief Financial Officer, Cesare Boffa who served as our Chief Technology
Officer, our Corporate Secretary and our Administrator. We expect to hire a
manager who will supervise the photovoltaic park installation and development in
2010.  Subsequent to the end of the period covered by this Report, Dr.
Boffa resigned as the Company’s Chief Technology Officer, and agreed to serve as
a consultant to the Company.  In addition, Barbara Salz resigned as
corporate secretary.





Effective
as of August 4, 2009, Dr. Augustine Fou resigned as a member of the Board of
Directors of the Company. Dr. Fou has not expressed any disagreement with the
Company on any matter relating to the Company’s operations, policies or
practices.





Research
and Development





We have
not yet determined our anticipated spending on research and development
activities for the year ending December 31, 2009. Research and development
efforts are expected to be overseen by our former Chief Technology Officer,
Cesare Boffa, who now serves the Company as a consultant.





Off
Balance Sheet Arrangements





The
Company does not have any off balance sheet arrangements that have or are
reasonably likely to have a current or future effect on the Company's financial
condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or capital
resources.


14




ITEM
3.         QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK





Not
Applicable.





ITEM
4.         CONTROLS AND
PROCEDURES





As of the
end of the period covered by this report, the Company carried out, under the
supervision and with the participation of the Company’s management, including
its Acting Chief Executive Officer and Acting Chief Financial Officer, an
evaluation of the effectiveness of the design and operation of the Company’s
disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e)
under the Securities Exchange Act of 1934) in ensuring that information required
to be disclosed by the Company in its reports is recorded, processed, summarized
and reported within the required time periods. In carrying out that evaluation,
management identified a material weakness (as defined in Public Company
Accounting Oversight Board Standard No. 2) in our internal control over
financial reporting.





The
material weakness identified by Management consisted of inadequate staffing and
supervision within the bookkeeping and accounting operations of the Company. The
relatively small number of employees who have bookkeeping and accounting
functions prevents us from segregating duties within the Company’s internal
control system. The inadequate segregation of duties is a weakness because it
could lead to the untimely identification and resolution of accounting and
disclosure matters or could lead to a failure to perform timely and effective
reviews. Accordingly, based on their evaluation of the Company’s disclosure
controls and procedures as of September 30, 2009, the Company’s Acting Chief
Executive Officer and its Acting Chief Financial Officer have concluded that, as
of that date, the Company’s controls and procedures were not effective for the
purposes described above. The Company intends to take steps to remediate such
procedures as soon as reasonably possible.





There was
no change in the Company’s internal control over financial reporting (as defined
in Rule 13a-15(f) and 15d-15(f) under the Securities Exchange Act of 1934)
during the quarter ended September 30, 2009 that has materially affected or is
reasonably likely to materially affect the Company’s internal control over
financial reporting.


15





PART
II.        OTHER INFORMATION





ITEM
1.          LEGAL PROCEEDINGS




The
Company is not, and has not been during the period covered by this Quarterly
Report, a party to any legal proceedings.




ITEM
1A.       RISK FACTORS




Not
Applicable.





ITEM
2:          UNREGISTERED SALES OF EQUITY SECURITIES
AND USE OF PROCEEDS




None.





ITEM
3:          DEFAULTS UPON SENIOR
SECURITIES





Not
Applicable.




ITEM
4:          SUBMISSION OF MATTERS TO A VOTE OF
SECURITY HOLDERS




No
matters were submitted to the vote of the Company’s security holders during the
period covered by this Quarterly Report.




ITEM
5:          OTHER INFORMATION





Resignation
of Directors and Appointment to Advisory Committee





Effective
as of November 9, 2009, each of Cesare Boffa, Bruno Colle and Roberto Gerbo has
resigned as a member of the Board of Directors of Prime Sun Power Inc. (the
“Company”).  None of these directors has expressed any disagreement
with the Company on any matter relating to the Company’s operations, policies or
practices.  Effective as of the same date, each of these three
individuals were appointed to the Company’s Advisory Committee.  The
three members of the Company’s Advisory Committee will advise the Company’s
officers and directors on technology and management matters.  The
compensation of Mr. Colle and Mr. Gerbo has not been set as of the date of this
Report.  The compensation of Professor Boffa is included in the
compensation for services rendered as a consultant to the Company as discussed
below.





Resignation
of Chief Technology Officer and Appointment as Consultant





Dr. Boffa
resigned as the Company’s Chief Technology Officer, effective as of November 9,
2009.  He will continue to serve the Company on the Advisory Committee
and as a consultant to the Company.





Resignation
of Corporate Secretary





Effective
as of November 9, 2009, Ms. Barbara Salz resigned as the Company’s Corporate
Secretary.


16





ITEM
6.          EXHIBITS




Exhibit
                      Description31.1
                      Certification
      of Principal Executive Officer and Principal Financial Officer pursuant to
      Section 302 of the Sarbanes-Oxley Act of 2002.32.1
                      Certification
      of the Principal Executive Officer and Principal Financial Officer
      pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of
      the Sarbanes-Oxley Act of
2002.


17





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.





PRIME
      SUN POWER INC.By:
                /s/
      Olivier de VergniesName:
                Olivier
      de VergniesTitle:
                Acting
      Chief Executive Officer,
                  Acting
      Principal Financial Officer and
                  Acting
      Principal Accounting
Officer





Dated:    November 23,
2009


18