*Table
        of Contents*







**SECURITIES
      AND EXCHANGE COMMISSION**


**WASHINGTON,
      D.C. 20549**





**FORM
      10-Q**








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


**For
      the quarterly period ended September 30, 2008**





**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 001-16173




**SUNRISE
      SOLAR CORPORATION**


(Exact
      name of small business issuer as specified in its charter)





**Nevada**
            **88-0460457**(State
                or other jurisdiction of
              incorporation
                or organization)
            (I.R.S.
                Employer
              Identification
                No.)**4703
                Shavano Oak, Suite 104****San
                Antonio, Texas**
            **78249**(Address
                of principal
              executive
                offices)
            (Zip
                Code)Registrant's
                telephone number, including area code: (210)
                881-0850









Indicate
      by check mark whether the registrant (1) has filed all reports required to
      be
      filed by Section 13 or 15(d) of the Exchange Act 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 þ  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:





Large
                accelerated filer
            o
            
            Accelerated
                filer
            oNon-accelerated
                filer
            o
            
            Smaller
                reporting company
            þ




There
      were 6,282,077 shares of the registrant’s common stock issued and outstanding as
      of November 14, 2008.





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


Yes
o  No þ












*Table
        of Contents*




**IMPORTANT
      INFORMATION REGARDING THIS FORM 10-Q**





Unless
      otherwise indicated, references to “we,” “us,” and “our” in this Quarterly
      Report on Form 10-Q refer to Sunrise Solar Corporation.





Readers
      should consider the following information as they review this Quarterly
      Report:





**Forward-Looking
      Statements**





The
      statements contained or incorporated by reference in this Quarterly Report
      on
      Form 10-Q that are not historical facts are “forward-looking statements” (as
      such term is defined in the Private Securities Litigation Reform Act of 1995),
      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”).  All statements other than statements of historical fact are,
      or may be deemed to be, forward-looking statements.  Forward-looking
      statements include any statement that may project, indicate or imply future
      results, events, performance or achievements.  The forward-looking
      statements contained herein are based on current expectations that involve
      a
      number of risks and uncertainties. These statements can be identified by the
      use
      of forward-looking terminology such as “believes,” “expect,” “may,” “will,”
“should,” “intend,” “plan,” “could,” “estimate” or “anticipate” or the negative
      thereof or other variations thereon or comparable terminology, or by discussions
      of strategy that involve risks and uncertainties.





Given
      the
      risks and uncertainties relating to forward-looking statements, investors should
      not place undue reliance on such statements.  Forward-looking
      statements included in this Quarterly Report on Form 10-Q speak only as of
      the
      date of this Quarterly Report on Form 10-Q and are not guarantees of future
      performance.  Although we believe that the expectations reflected in
      the forward-looking statements are reasonable, such expectations may prove
      to
      have been incorrect.  All subsequent written and oral forward-looking
      statements attributable to us, or persons acting on our behalf, are expressly
      qualified in their entirety by these cautionary statements.





**Subsequent
      Events**





All
      statements contained in this Quarterly Report on Form 10-Q, including the
      forward-looking statements discussed above, are made as of November 14, 2008,
      unless those statements are expressly made as of another date.  We
      disclaim any responsibility for the accuracy of any information contained in
      this Quarterly Report on Form 10-Q to the extent such information is affected
      or
      impacted by events, circumstances or developments occurring after November
      14,
      2008 or by the passage of time after such date.  Except to the extent
      required by applicable securities laws, we expressly disclaim any obligation
      or
      undertakings to release publicly any updates or revisions to any statement
      or
      information contained in this Quarterly Report on Form 10-Q, including the
      forward-looking statements discussed above, to reflect any change in our
      expectations with regard thereto or any change in events, conditions or
      circumstances on which any statement or information is based.




*Table
          of Contents*




SUNRISE
      SOLAR CORPORATION


AND
      SUBSIDIARIES


(A
      DEVELOPMENT STAGE ENTERPRISE)




**CONTENTS**







**PART
                I - FINANCIAL INFORMATION**ITEM
                1 - UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS(Unaudited)
                Consolidated Balance Sheets as of September 30,
                2008, and December 31, 2007
            F-1
                - F-2(Unaudited)
                Consolidated Statements of Operations for the
                three and nine months ended September 30, 2008 and 2007, and from
                Re-entering the Development Stage to September 30,
                2008
            F-3(Unaudited)
                Consolidated Statement of Changes in Stockholders’
                Deficit for the nine months ended September 30, 2008 and the years
                ended
                December 31, 2007 and 2006
            F-4(Unaudited)
                Consolidated Statements of Cash Flows for the nine
                months ended September 30, 2008 and 2007 , and from Re-entering the
                Development Stage to September 30, 2008
            F-5NOTES
                TO CONSOLIDATED FINANCIAL STATEMENTS
                (UNAUDITED)
            6
                -
                17ITEM
                2 - MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL
                CONDITION AND RESULTS OF OPERATIONS
            18
                - 20ITEM
                3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
                MARKET RISKS
            21ITEM
                4T - CONTROLS AND PROCEDURES
            21**PART
                2 - OTHER INFORMATION**ITEM
                1 - LEGAL PROCEEDINGS
            23ITEM
                6 - EXHIBITS AND REPORTS ON FORM 8K
            24






*Table
          of Contents*




SUNRISE
      SOLAR CORPORATION


AND
          SUBSIDIARIES
 (A
          DEVELOPMENT STAGE ENTERPRISE)
 CONSOLIDATED
            BALANCE SHEETS
 ASSETS(Unaudited)September
                  30, 2008
              
              December
                  31, 2007CURRENT
                  ASSETSCash
              
              $
              3,040
              
              $
              19,776Accounts
                  Receivable, less allowance for doubtfulaccounts
                  of $0 and $59,925
              
              
              -
              
              
              -Current
                  Note Receivable
              
              
              32,500
              
              
              -Prepaid
                  Expenses
              
              
              -
              
              
              11,310Total
                  Current Assets
              
              
              35,540
              
              
              31,086ASSETS
                  HELD FOR SALE, Net
              
              
              -
              
              
              577,438OTHER
                  ASSETSDeposits
              
              
              -
              
              
              85,000Long
                  Term Note Receivable
              
              
              21,667
              
              
              -Total
                  Other Assets
              
              
              21,667
              
              
              85,000TOTAL
                  ASSETS
              
              $
              57,207
              
              $
              693,524


*The
        accompanying notes are an integral part of these consolidated financial
        statements.*


*Table
          of Contents*




SUNRISE
      SOLAR CORPORATION


AND
            SUBSIDIARIES
 (A
            DEVELOPMENT STAGE ENTERPRISE)
 CONSOLIDATED
              BALANCE SHEETS




LIABILITIES
                  AND STOCKHOLDERS' DEFICIT(Unaudited)September
                  30, 2008
              
              December
                  31, 2007CURRENT
                  LIABILITIESAccounts
                  Payable
              
              $
              1,675
              
              $
              278,409Accounts
                  Payable, Related Parties
              
              
              -
              
              
              154,716Deferred
                  Liability
              
              
              70,000
              
              
              70,000Litigation
                  Settlement Liability
              
              
              307,500
              
              
              307,500Third
                  Party Advances
              
              
              44,500
              
              
              -Notes
                  Payable and Accrued Interest
              
              
              429,361
              
              
              805,993Notes
                  Payable to Stockholders and Accrued Interest
              
              
              -
              
              
              5,750,942Other
                  Current Liabilities
              
              
              38,085
              
              
              119,566Total
                  Current Liabilities
              
              
              891,121
              
              
              7,487,126TOTAL
                  LIABILITIES
              
              
              891,121
              
              
              7,487,126COMMITMENTS
                  AND CONTINGENCIES
              
              
              -
              
              
              -STOCKHOLDERS'
                  DEFICITPreferred
                  Stock, $.0001 par value, 5 million sharesauthorized;
                  no shares outstanding
              
              
              -
              
              
              -Common
                  Stock, $.0001 par value, 100 million sharesauthorized;
                  6,282,077 and 4,138,077 shares outstanding
              
              
              628
              
              
              414Additional
                  Paid-in Capital
              
              
              26,677,290
              
              
              19,815,491Accumulated
                  Deficit from Prior Operations
              
              
              (26,676,678
              )
              
              (26,609,507
              )Accumulated
                  Deficit from the Development Stage
              
              
              (835,154
              )
              
              -TOTAL
                  STOCKHOLDERS' DEFICIT
              
              
              (833,914
              )
              
              (6,793,602
              )TOTAL
                  LIABILITIES AND STOCKHOLDERS' DEFICIT
              
              $
              57,207
              
              $
              693,524
   *The
        accompanying notes are an integral part of these consolidated financial
        statements.*


*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
              SUBSIDIARIES
 (A
              DEVELOPMENT STAGE ENTERPRISE)
 CONSOLIDATED
                STATEMENTS OF OPERATIONS (UNAUDITED)


Re-enteringThree
                  Months Ended
              
              Nine
                  Months Ended
              
              Development
                Stage
                  toSeptember
                  30,
                2008
              
              September
                  30,
                2007
              
              September
                  30,
                2008
              
              September
                  30,
                2007
              
              September
                  30,
                2008REVENUES
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -
              
              $
              -COST
                  OF REVENUES
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -GROSS
                  PROFIT
              
              
              -
              
              
              -
              
              
              -
              
              
              -
              
              
              -EXPENSESPayroll,
                  contract labor and consultants
              
              
              89,149
              
              
              88,602
              
              
              506,954
              
              
              319,283
              
              
              437,181Selling,
                  general and administrative expenses
              
              
              11,710
              
              
              5,676
              
              
              26,219
              
              
              19,762
              
              
              23,796OPERATING
                  LOSS FROM CONTINUING OPERATIONS
              
              
              (100,859
              )
              
              (94,278
              )
              
              (533,173
              )
              
              (339,045
              )
              
              (460,977
              )Gain
                  on disposal of assets
              
              
              -
              
              
              -
              
              
              62,151
              
              
              -
              
              
              -Interest
                  income (expense)
              
              
              75,608
              
              
              (30,359
              )
              
              (35,132
              )
              
              (89,861
              )
              
              (16,638
              )NET
                  LOSS FROM CONTINUING OPERATIONS
              
              
              (25,251
              )
              
              (124,637
              )
              
              (506,154
              )
              
              (428,906
              )
              
              (477,615
              )DISCONTINUED
                  OPERATIONS (Note 9)Loss
                  from discontinued operations
              
              
              (164,840
              )
              
              (261,236
              )
              
              (396,171
              )
              
              (644,245
              )
              
              (357,539
              )NET
                  LOSS
              
              $
              (190,091
              )
              $
              (385,873
              )
              $
              (902,325
              )
              $
              (1,073,151
              )
              $
              (835,154
              )NET
                  LOSS PER SHARE:Common
                  Stock:Basic
                  and Diluted Net Loss Per Share
              
              $
              (0.00
              )
              $
              (0.03
              )
              $
              (0.08
              )
              $
              (0.10
              )Basic
                  and Diluted Net Loss Per Sharefor
                  Discontinued Operations
              
              $
              (0.03
              )
              $
              (0.06
              )
              $
              (0.07
              )
              $
              (0.16
              )Total
                  Basic and Diluted Net Loss Per Share
              
              $
              (0.03
              )
              $
              (0.09
              )
              $
              (0.15
              )
              $
              (0.26
              )Denominator
                  for Basic and Diluted Net Loss Per ShareWeighted
                  Average Number ofCommon
                  Shares Outstanding
              
              
              6,241,751
              
              
              4,138,077
              
              
              6,048,473
              
              
              4,138,077


*The
        accompanying notes are an integral part of these consolidated financial
        statements.*






*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
              SUBSIDIARIES
 (A
              DEVELOPMENT STAGE ENTERPRISE)
 CONSOLIDATED
                STATEMENT OF CHANGES IN STOCKHOLDERS' DEFICIT
                (UNAUDITED)


Additional
              
              Accumulated
                  Defecit
              
              TotalCommon
                  Stock
              
              Paid-In
              
              Prior
              
              Development
              
              Stockholders'Shares
              
              Amount
              
              Capital
              
              Operations
              
              Stage
              
              Deficit**BALANCE
                  -- December 31, 2005**
              
              
              **4,128,077**
              
              **$**
              **413**
              
              **$**
              **19,431,071**
              
              **$**
              **(23,721,232**
              **)**
              **$**
              **-**
              
              **$**
              **(4,289,748**
              **)**Shares
                  Issued for Loan Incentive
              
              
              10,000
              
              
              1
              
              
              5,499
              
              
              --
              
              
              --
              
              
              5,500Interest
                  Imputed on Non-Interest Bearing Notes Payable
              
              
              --
              
              
              --
              
              
              168,053
              
              
              --
              
              
              --
              
              
              168,053Net
                  loss
              
              
              --
              
              
              --
              
              
              --
              
              
              (1,441,988
              )
              
              --
              
              
              (1,441,988
              ).**BALANCE
                  -- December 31, 2006**
              
              
              **4,138,077**
              
              
              **414**
              
              
              **19,604,623**
              
              
              **(25,163,220**
              **)**
              
              **-**
              
              
              **(5,558,183**
              **)**Interest
                  Imputed on Non-Interest Bearing Notes Payable
              
              
              --
              
              
              --
              
              
              210,868
              
              
              --
              
              
              --
              
              
              210,868Net
                  loss
              
              
              --
              
              
              --
              
              
              --
              
              
              (1,446,287
              )
              
              --
              
              
              (1,446,287
              ).**BALANCE
                  -- December 31, 2007**
              
              
              **4,138,077**
              
              
              **414**
              
              
              **19,815,491**
              
              
              **(26,609,507**
              **)**
              
              **-**
              
              
              **(6,793,602**
              **)**Compensatory
                  Element of Stock Issuance
              
              
              500,000
              
              
              50
              
              
              99,950
              
              
              --
              
              
              --
              
              
              100,000Stock
                  Issued for Consulting Services
              
              
              1,644,000
              
              
              164
              
              
              372,237
              
              
              --
              
              
              --
              
              
              372,401Interest
                  Imputed on Non-Interest Bearing Notes Payable
              
              
              --
              
              
              --
              
              
              149,606
              
              
              --
              
              
              --
              
              
              149,606Debt
                  & Interest Forgiven by Related Parties
              
              
              
              
              
              
              
              
              6,240,006
              
              
              --
              
              
              --
              
              
              6,240,006Net
                  loss
              
              
              --
              
              
              --
              
              
              --
              
              
              (67,171
              )
              
              (835,154
              )
              
              (902,325
              ).**BALANCE
                  -- September 30, 2008**
              
              
              **6,282,077**
              
              **$**
              **628**
              
              **$**
              **26,677,290**
              
              **$**
              **(26,676,678**
              **)**
              **$**
              **(835,154**
              **)**
              **$**
              **(833,914**
              **)**
   *The
        accompanying notes are an integral part of these consolidated financial
        statements.*






*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
              SUBSIDIARIES
 (A
              DEVELOPMENT STAGE ENTERPRISE)
 CONSOLIDATED
                STATEMENT OF CASH FLOWS (UNAUDITED)


Re-enteringNine
                  Months Ended
              
              Nine
                  Months Ended
              
              Development
                  Stage toCASH
                  FLOWS FROM OPERATING ACTIVITIES
              
              September
                  30, 2008
              
              September
                  30, 2007
              
              September
                  30, 2008Net
                  Loss
              
              $
              (902,325
              )
              $
              (1,073,151
              )
              $
              (835,154
              )Loss
                  from Discontinued Operations
              
              
              396,171
              
              
              644,245
              
              
              357,539Loss
                  from Continuing Operations
              
              
              (506,154
              )
              
              (428,906
              )
              
              (477,615
              )Adjustments
                  to reconcile net loss to netcash
                  provided by (used in) operating activities:Imputed
                  interest
              
              
              149,606
              
              
              153,216
              
              
              130,089Gain
                  on Disposal of Assets
              
              
              (62,151
              )
              
              (3,216
              )
              
              -Issuance
                  of Common Stock for Services
              
              
              472,401
              
              
              -
              
              
              405,601Changes
                  in operating assets and liabilities:Accounts
                  Receivable
              
              
              -
              
              
              (146,065
              )
              
              -Other
                  Current Assets
              
              
              -
              
              
              (55
              )
              
              -Accounts
                  Payable
              
              
              -
              
              
              (131,120
              )
              
              -Accrued
                  Expenses
              
              
              (42,002
              )
              
              271,774
              
              
              (42,002
              )Prepaid
                  Expenses
              
              
              11,310
              
              
              
              
              
              11,310Litigation
                  Settlement
              
              
              -
              
              
              (67,500
              )
              
              -NET
                  CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
              
              
              23,010
              
              
              (351,872
              )
              
              27,383CASH
                  FLOWS FROM INVESTING ACTIVITIESPurchases
                  of Fixed Assets
              
              
              -
              
              
              1,874
              
              
              -Principal
                  Payments on Notes Receivable
              
              
              10,833
              
              
              -
              
              
              9,024NET
                  CASH PROVIDED BY INVESTING ACTIVITIES
              
              
              10,833
              
              
              1,874
              
              
              9,024CASH
                  FLOWS FROM FINANCING ACTIVITIESNote
                  Proceeds from Stockholders Loans
              
              
              55,050
              
              
              729,159
              
              
              45,857Note
                  Proceeds from Other Loans
              
              
              44,500
              
              
              -
              
              
              42,329NET
                  CASH PROVIDED BY FINANCING ACTIVITIES
              
              
              99,550
              
              
              729,159
              
              
              88,186DISCONTINUED
                  OPERATIONSDiscontinued
                  Operating Activities
              
              
              (150,129
              )
              
              (405,810
              )
              
              (112,030
              )NET
                  CASH USED IN DISCONTINUED OPERATIONS
              
              
              (150,129
              )
              
              (405,810
              )
              
              (112,030
              )NET
                  INCREASE (DECREASE) IN CASH
              
              
              (16,736
              )
              
              (26,649
              )
              
              12,563CASH–
                  Beginning
              
              
              19,776
              
              
              33,077
              
              
              (9,523
              )CASH–
                  Ending
              
              $
              3,040
              
              $
              6,428
              
              $
              3,040SUPPLEMENTAL
                  DISCLOSURES OF CASH FLOW INFORMATIONCash
                  paid for:Interest
              
              $
              -
              
              $
              31,947
              
              $
              -Income
                  Taxes
              
              $
              -
              
              $
              -
              
              $
              -Non-cash
                  investing and financing activities:Sale
                  of ASPECT Business Segment for Notes Receivable
              
              $
              65,000
              
              $
              -
              
              $
              -Debt
                  Converted to Contributed Capital by Related Parties
              
              $
              6,240,006
              
              $
              -
              
              $
              -Transfer
                  of Deposit Rights to Note Holder
              
              $
              -
              
              $
              170,000
              
              $
              -






*The
      accompanying notes are an integral part of these consolidated financial
      statements.*




*Table
          of Contents*






SUNRISE
      SOLAR CORPORATION


AND
      SUBSIDIARIES


(A
      DEVELOPMENT STAGE ENTERPRISE)




NOTES
        TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
 
  NOTE
        1 - BASIS
        OF PRESENTATION





The
      accompanying unaudited interim financial statements of Sunrise Solar Corporation
      (“SSC”) have been prepared in accordance with accounting principles generally
      accepted in the United States of America and the rules of the Securities and
      Exchange Commission ("SEC"), and should be read in conjunction with the audited
      financial statements and notes thereto contained in SSC's financial statements
      filed with the SEC on Form 10-KSB for the year ended December 31, 2007. In
      the
      opinion of management, all adjustments, consisting of normal recurring
      adjustments, necessary for a fair presentation of financial position and the
      results of operations for the interim periods presented have been reflected
      herein. The results of operations for interim periods are not necessarily
      indicative of the results to be expected for the full year. Notes to the
      financial statements which would substantially duplicate the disclosure
      contained in the audited financial statements for the most recent fiscal year
      2007 as reported in Form 10-KSB have been omitted.





NOTE
      2 - GOING
      CONCERN





The
      Company sustained a substantial loss of approximately $902,000 during the nine
      months ended September
      30 ,
      2008,
      and as of September
      30 ,
      2008,
      had a combined accumulated deficit of approximately $27,512,000.





These
      factors raise a substantial doubt about 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.





The
      Company does not have the resources at this time to repay its credit and debt
      obligations, make any payments in the form of dividends to its shareholders
      or
      fully implement its business plan. Without additional capital, the Company
      will
      not be able to remain in business.





In
      addition to operational expenses, as the Company executes its business plan,
      it
      is incurring expenses related to complying with its public reporting
      requirements. In order to finance these expenditures, the Company has raised
      capital in the form of debt which will have to be repaid, as discussed in detail
      below.  The Company has depended on shareholder loans for much of its
      operating capital.  The Company will need to raise capital in the next
      twelve months in order to remain in business.





*Table
          of Contents*






SUNRISE
      SOLAR CORPORATION


AND
      SUBSIDIARIES


(A
      DEVELOPMENT STAGE ENTERPRISE)




NOTES
        TO
        UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


Management
      anticipates that significant dilution will occur as the result of any future
      sales of the Company’s common stock and this will reduce the value of its
      outstanding shares. The Company cannot project the future level of dilution
      that
      will be experienced by investors as a result of its future financings, but
      it
      will significantly affect the value of its shares.





Management
      has plans to address the Company’s financial situation as follows:





In
      the
      near term, management plans to continue to focus on raising the funds necessary
      to fully implement the Company’s business plan. Management believes that certain
      shareholders will continue to advance the capital required to meet the Company’s
      financial obligations. There is no assurance, however, that these shareholders
      will continue to advance capital to the Company or that the new business
      operations will be profitable. The possibility of failure in obtaining
      additional funding and the potential inability to achieve profitability raise
      doubts about the Company’s ability to continue as a going concern.




In
      the
      long term, management believes that the Company’s previously announced projects
      and initiatives will be successful and will provide significant profit to the
      Company which will be used to finance the Company’s future growth. However,
      there can be no assurances that the Company’s planned activities will be
      successful, or that the Company will ultimately attain profitability.  The
      Company’s long term viability depends on its ability to obtain adequate sources
      of debt or equity funding to meet current commitments and fund the continuation
      of its business operations and the ability of the Company to ultimately achieve
      adequate profitability and cash flows from operations to sustain its operations.





NOTE
      3
      - ACCOUNTING
      POLICIES





BASIC
      AND
      DILUTED EARNINGS (LOSS) PER SHARE - Basic
      and diluted earnings (loss) per share equals net loss divided by weighted
      average shares outstanding during the period. Diluted earnings (loss) per share
      includes the impact of common stock equivalents using the treasury stock method
      when the effect is dilutive. There were no common stock equivalents at September
      30, 2008.





DEVELOPMENT
      STAGE ENTERPRISE ***-*** As
      a
      result of the Company’s sale of SMS Envirofuels, Inc. and ASPECT, it’s only
      revenue source, the Company is now considered a development stage enterprise
      pursuant to FASB Statement number 7, which focuses on development stage
      companies. Users of the financial statements should be familiar with this
      statement and its effect on the financial statements.


*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
        SUBSIDIARIES
 (A
        DEVELOPMENT STAGE ENTERPRISE)
  NOTES
          TO
          UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS




NOTE
      4 - SALE
      OF SMS ENVIROFUELS, INC.





On
      August
      20, 2008, the Company reached an agreement with certain affiliated parties
      to
      sell the company’s SMS Envirofuels, Inc. subsidiary. The terms of the agreement
      call for the forgiveness of all debts owed to said affiliated parties in return
      for 100% of SMSE’s stock. As a result of this transaction the Company classified
      SMSE as “Discontinued Operations” for the purposes of these financial statements
      in accordance with FASB Statement 144. Additional disclosure can be found in
      Note 10. As a result of the transaction the Company reduced Total Assets in
      the
      amount of $659,619 and reduced Total Liabilities in the amount of $6,899,625.
      The difference of $6,240,006 was accounted for as capital contributed by
      affiliated parties and was therefore added to Additional
      Paid-In-Capital.





NOTE
      5 - SALE
      OF ASPECT BUSINESS SOLUTIONS, INC.





On
      January 15, 2008, the Company reached an agreement with certain affiliated
      parties to sell the company’s Aspect, Inc. subsidiary. The terms of the
      agreement call for the payment of approximately $65,000 to the Company in return
      for 100% of Aspect’s stock. The $65,000 is being paid over 24 months in the form
      of a note receivable with monthly payments of $2,708 per month which began
      on
      February 15, 2008, and included the first payment due at closing. In addition,
      the Company agreed to continue assuming Aspect’s outstanding debt as of the date
      of the sale which was already previously consolidated. As a result of this
      transaction the Company classified Aspect as “Discontinued Operations” for the
      purposes of these financial statements in accordance with FASB Statement 144
      and
      recorded a “Gain on Disposal of Assets” of $62,151 which represented the value
      of the assets given up of $2,849 less the consideration received. Additional
      disclosure can be found in Note 9. The total debt assumed by the Company and
      not
      part of the sale was approximately $2,385,000, which was subsequently forgiven
      (see Note 4).





NOTE
      6 - NOTES
      PAYABLE TO OTHERS





On
      February 3, 2006, SMS borrowed $500,000 from an independent lender. The security
      pledged for this note is equipment recently purchased plus the deposit placed
      on
      equipment currently being prepared for delivery in the future. The interest
      rate
      on the unpaid balance is 18%. The Company is in default on this note. On
      February 8, 2007, an agreement to transfer deposit rights and partial release
      of
      the promissory note was signed by the Company and the independent note holder.
      In the agreement, the Company has transferred the rights to the deposit placed
      by the Company on 4 pieces of equipment that were to be used by its subsidiary
      SMSE, a value of $170,000, in exchange for a release and discharge of $240,000
      of the promissory note. In addition, the Company has the right to further
      release of $15,000 for any future transfer to note holder of the rights in
      the
      deposits of 2 additional pieces of equipment, a value of $85,000. At September
      30, 2008, the deferred liability is $70,000 and the principal balance on the
      note is $260,000 with interest accrued of $169,360. As indicated in Note 4,
      on
      August 20, 2008, the Company sold its SMSE subsidiary, some of the assets of
      which were used to collateralize this promissory note. At this time the Company
      cannot accurately forecast the ramifications of this default.






*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
        SUBSIDIARIES
 (A
        DEVELOPMENT STAGE ENTERPRISE)
  NOTES
          TO
          UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS


On
      October 5, 2006, SMSE received an LOI, from EBOF, for the purchase of assets
      associated with its production facility in Poteet. The initial terms of the
      LOI
      enabled SMSE to sign a promissory note with EBOF for a line of credit not to
      exceed $788,000. The expiration date of this note was February 2, 2007. SMSE
      is
      in default on this note. The terms of the LOI were not met by the purchaser
      and
      the LOI expired with no sale. The interest rate on the unpaid balance is 18%.
      As
      of August 20, 2008, the principal balance on the note was $350,000 and interest
      accrued was $93,005. As part of the sale of SMSE this liability was transferred
      to the new owners of SMSE.





NOTE
      7 - NOTES
      PAYABLE TO STOCKHOLDERS





On
      April
      15, 2003, the predecessor to SSC signed a one-year promissory note with a
      stockholder for a line of credit up to $2,000,000. This note was extended for
      an
      additional one-year term on April 15, 2004. On March 7, 2006, the line was
      reduced to $500,000 and extended to December 31, 2006. On December 31, 2006,
      the
      note was extended to February 28, 2008 with an increase in the line amount
      to
      $1,000,000. On February 28, 2008 the note was extended until February 28, 2009.
      The note bears 10% interest, is payable on demand and has no collateral. As
      of
      August 20, 2008, the principal balance was $622,634 and accrued interest was
      $147,741.





On
      February 24, 2003, SMSE signed a one-year promissory note with a stockholder
      for
      a line of credit up to $1,000,000. This note was extended for an additional
      one-year term on February 24, 2004. On March 7, 2006, the credit line was
      increased to $2,000,000 and extended to December 31, 2006. On December 31,
      2006,
      the note was extended to February 28, 2008 and the line was increased to
      $2,500,000. On February 28, 2008 the note was extended until February 28, 2009.
      The line of credit bears 10% interest, is payable on demand and has no
      collateral. As of August 20, 2008, the principal balance was $2,078,652 and
      accrued interest was $745,893.





The
      stockholder also advanced money to ASPECT on an as-needed basis. The advances
      were assumed by SSC on January 15, 2008. On August 20, 2008 these advances
      were
      forgiven as part of the sale of SMSE. As of August 20, 2008 these advances
      totaled $2,343,810.





During
      the nine months ended September 30, 2008, the company borrowed an additional
      $55,000 against these credit facilities. All of these stockholder credit
      facilities have been cancelled and all balances due to stockholders forgiven
      in
      consideration for the sale of SMSE on August 20, 2008. More information can
      be
      found in Notes 4&10.






*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
        SUBSIDIARIES
 (A
        DEVELOPMENT STAGE ENTERPRISE)
  NOTES
          TO
          UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS




NOTE
      8 - ADVANCES
      FROM THIRD PARTIES





As
      of
      September 30, 2008 the Company had received net, non-interest bearing advances
      from certain third parties totaling $44,500. These advances are not
      collateralized and are due on demand.





NOTE
      9 - EQUITY





During
      the nine months ended September 30, 2008, the Company issued 500,000 shares
      of
      its common stock to its new Chairman and CEO for services rendered valued at
      $100,000 based on the quoted market price of the Company’s common stock on the
      date of issuance.





Additionally,
      the Company issued 1,644,000 shares of its common stock to four consultants
      for
      services rendered during the Company’s transition valued at $372,401 based on
      the quoted market price of the Company’s common stock on the date of
      issuance.





Interest
      imputed on related party notes during the nine months ended September 30, 2008
      was $149,606.





On
      August
      20, 2008, the Company reached an agreement with certain affiliated parties
      to
      sell the company’s SMS Envirofuels, Inc. subsidiary. The terms of the agreement
      call for the forgiveness of all debts owed to said affiliated parties in return
      for 100% of SMSE’s stock. More information can be found in Notes 4 &
9.





On
      May 2,
      2008, the Company’s Board of Directors approved an amendment, subject to
      shareholder approval, to the Company’s Articles of Incorporation to effect a
      reverse stock split at the ratio of 1 for 5. On May 5, 2008, the majority
      stockholders of the Company approved the same resolution.




The
      Company has authorized capital consisting of 100,000,000 shares of common stock
      of which 30,690,386 shares of common stock were outstanding on May 5, 2008.
      Pursuant to the reverse stock split, the 30,690,386 shares of common stock
      previously outstanding were automatically converted into approximately 6,138,077
      shares of common stock.





*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
        SUBSIDIARIES
 (A
        DEVELOPMENT STAGE ENTERPRISE)
  NOTES
          TO
          UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS




NOTE
      10 - DISCONTINUED
      OPERATIONS





SMSE


SMSE,
      a
      subsidiary of the Company, ceased production in December 2006 and its assets
      located in Poteet, Texas were classified as Held for Sale at December 31, 2006.
      On August 20, 2008, the Company sold SMSE to certain affiliated parties (see
      Note 4).





SMSE’s
      activity represented the entirety of the Company’s alternative fuels segment
      (see Note 12). SMSE’s sales, reported in discontinued operations, for the nine
      months ended September 30, 2008 and 2007 are $0 and $10,200, respectively.
      SMSE’s pretax loss from operations, reported in discontinued operations, for the
      nine months ended September 30, 2008 and 2007 were $302,795 and $433,952,
      respectively. Prior year financial statements been restated to present the
      operations of SMSE as a discontinued operation. Below is a table of all assets
      and liabilities for the discontinued operations of SMSE:





At
            
            AtSeptember
                30,
            
            December
                31,Assets
                of discontinued operations:
            
            2008
            
            2007Cash
            
            $
            --
            
            $
            2,561Inventory
            
            
            --
            
            
            --Property
                and Equipment, net
            
            
            --
            
            
            574,619Other
                Assets
            
            
            --
            
            
            9,392Total
                Assets
            
            $
            --
            
            $
            586,572Liabilities
                of discontinued operations:Accounts
                Payable
            
            
            --
            
            
            252,281Accounts
                Payable - related parties
            
            
            --
            
            
            154,716Accrued
                Expenses
            
            
            --
            
            
            51,438Total
                Liabilities
            
            $
            --
            
            $
            458,435








*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
        SUBSIDIARIES
 (A
        DEVELOPMENT STAGE ENTERPRISE)
  NOTES
          TO
          UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS




Aspect


Aspect,
      a
      subsidiary of the Company, was sold pursuant to a Stock Purchase Agreement
      with
      certain affiliated individuals of the Company on January 15, 2008 (see Note
      5).
      As a result of this transaction the Company classified Aspect as “Discontinued
      Operations” for the purposes of these financial statements.





Aspect’s
      activity represents the entirety of the Company’s software sales and programming
      segment (see Note 12). Aspect’s sales, reported in discontinued operations, for
      the nine months ended September 30, 2008 and 2007 are $0 and $339,795,
      respectively. Aspect’s pretax gain from operations, reported in discontinued
      operations, for the nine months ended September 30, 2008 and 2007 were $93,936
      and $210,294, respectively. Prior year financial statements have been restated
      to present the operations of Aspect as a discontinued operation. Below is a
      table of all assets and liabilities for the discontinued operations of
      Aspect:





At
            
            AtSeptember
                30,
            
            December
                31,Assets
                of discontinued operations:
            
            2008
            
            2007Cash
            
            $
            --
            
            $
            17,184Prepaid
                Expenses
            
            
            --
            
            
            612Property
                and Equipment, net
            
            
            --
            
            
            2,819Total
                Assets
            
            $
            --
            
            $
            20,615Liabilities
                of discontinued operations:Accounts
                Payable
            
            
            --
            
            
            22,094Accounts
                and Notes Payable - related parties
            
            
            --
            
            
            2,343,413Accrued
                Expenses
            
            
            --
            
            
            60,220Total
                Liabilities
            
            $
            --
            
            $
            2,425,727




NOTE
      11 - INTERNAL
      REVENUE SERVICE TAX LIEN





During
      the second and third quarters of 2005, ASPECT, one of the Company’s former
      subsidiaries, did not have the funds necessary to cover all the payroll taxes.
      In January 2006, the Internal Revenue Service (“IRS”) placed a lien on ASPECT
      assets. A third party accounting firm which represented ASPECT in the due
      process hearing negotiated an installment plan to settle the outstanding
      liability. Payments were tendered from this third party firm on behalf of the
      Company’s largest shareholder and holder of a line of credit with ASPECT. The
      balance due at September 30, 2008 is $38,086.





*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
        SUBSIDIARIES
 (A
        DEVELOPMENT STAGE ENTERPRISE)
  NOTES
          TO
          UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS




NOTE
      12 - OPERATING
      RESULTS AND SEGMENT INFORMATION





(Discontinued)
            
            (Discontinued)Software
                Sales
            
            Alternative&
                Programming
            
            Fuels
            
            All
                Other
            
            Total9
                Months Ended September 30, 2008Revenues
                from operations
            
            $
            14,634
            
            $
            --
            
            $
            --
            
            $
            14,634Net
                operating loss from operations
            
            
            --
            
            
            --
            
            
            (537,371
            )
            
            (534,371
            )Loss
                from discontinued operations
            
            
            (93,376
            )
            
            (302,795
            )
            
            --
            
            
            (396,171
            )Assets
                held for sale
            
            
            --
            
            
            --
            
            
            --
            
            
            --Capital
                Expenditures
            
            
            --
            
            
            --
            
            
            --
            
            
            --Current
                Depreciation (included in gain on disposal)
            
            
            2,819
            
            
            --
            
            
            --
            
            
            2,819


9
                Months Ended September 30, 2007Revenues
                from operations
            
            $
            339,795
            
            $
            10,200
            
            $
            --
            
            $
            349,995Net
                operating loss from operations
            
            
            --
            
            
            --
            
            
            (428,906
            )
            
            (428,906
            )Loss
                from discontinued operations
            
            
            (210,293
            
            
            (433,952
            )
            
            --
            
            
            (644,245
            )Assets
                held for sale
            
            
            3,923
            
            
            574,619
            
            
            --
            
            
            578,542Capital
                Expenditures
            
            
            1,726
            
            
            --
            
            
            --
            
            
            1,726Depreciation
            
            
            5,251
            
            
            --
            
            
            --
            
            
            5,251





The
      Company reports its operations by segments, which for the Company, relates
      to
      specific subsidiaries that are individually managed and have separate financial
      results that are viewed by the Company’s chief operating decision-maker. Profit
      from operations is net sales less cost of sales and selling, general and
      administrative expenses. There are two segments: Software sales and programming,
      and alternative fuels. In addition, the Company reports certain administrative
      activities under the corporate segment labeled “All Other.”





As
      previously discussed, the Company sold its SMSE business segment on August
      20,
      2008. The results of SMSE are presented herein as discontinued
      operations.





Also,
      as
      previously discussed, the Company sold its ASPECT business segment on January
      15, 2008. The results of ASPECT are presented herein as discontinued
      operations.





*Table
          of Contents*




SUNRISE
        SOLAR CORPORATION
 AND
        SUBSIDIARIES
 (A
        DEVELOPMENT STAGE ENTERPRISE)
  NOTES
          TO
          UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS




NOTE
      13 - RELATED
      PARTY TRANSACTIONS





On
      August
      20, 2008, the Company sold its SMSE subsidiary to certain affiliated parties
      in
      return for the forgiveness of certain debts (see Note 4).





The
      Company is located in office space which is sub-leased from our largest
      shareholder. This space is approximately 1,500 square feet, with an average
      monthly rent of $2,300.





NOTE
      14 - RECLASSIFICATION





Certain
      accounts from prior periods have been reclassified to conform to current period
      presentation.






*Table
          of Contents*






**ITEM
      2:****MANAGEMENT'S
      DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF
      OPERATIONS**




**FORWARD
      LOOKING STATEMENTS**


This
      document contains "forward-looking statements" within the meaning of the Private
      Securities Litigation Reform Act of 1995.  Forward-looking statements may
      be identified by words such as "expects," "anticipates," "intends," "plans,"
      "believes," "seeks," "estimates," "will" or words of similar meaning and
      include, but are not limited to, statements about the expected future business
      and financial performance of the Company.  Forward-looking statements are
      based on management's current expectations and assumptions, which are inherently
      subject to uncertainties, risks and changes in circumstances that are difficult
      to predict.  Actual outcomes and results may differ materially from these
      expectations and assumptions due to changes in global political, economic,
      business, competitive, market, regulatory and other factors.  We undertake
      no obligation to publicly update or review any forward-looking information,
      whether as a result of new information, future developments or
      otherwise.




**The
      following discussion and analysis should be read in connection with the
      Company’s consolidated financial statements and related notes thereto, as
      included in this report, as well as the Company’s Annual Report filed on form
      10-KSB.**





**Overview**





Sunrise
      Solar Corporation intends to develop and commercialize leading edge solar power
      technologies. We will bring solar power products to the consumer market
      primarily by utilizing our Internet presence. We also intend to distribute
      products to large public and commercial purchasers through wholesale
      channels.




In
      our
      early history, our revenue was derived principally from software services and
      BioFuel production. Both of these prior businesses are now considered
      discontinued operations. Currently, significant resources have been used in
      the
      establishment of our corporate structure for finance, reporting, and governance,
      and we would anticipate that such expenses will decrease, as a percentage of
      revenue, as our business increases.





On
      May 5,
      2008, we changed our name from Systems Management Solutions, Inc. to Sunrise
      Solar Corporation, and effected a one-for-five reverse stock split. For purposes
      of discussion and disclosure, we refer to the organization, both pre and post
      name change as Sunrise Solar Corporation.





*Table
          of Contents*




Management
      is considering the impact of the following industry trends as they impact the
      manufacturing of complete photovoltaic systems and planned business model:





·
            Solar
                cell pricing trends around the world: Recently the key material in
                the
                production of solar cells (silicon) has been in limited supply.
                Consequently, prices and availability of solar modules have been
                limited.
                Solar cells are the major component cost in a photovoltaic module.
                The
                Company has responded by seeking long-term supply agreements for
                solar
                cells where pricing is adjusted quarterly to market rates. To date
                the
                Company has not entered into any long-term supply agreements for
                solar
                cells. Our intent is secure ample solar cell supply to meet our growth
                needs and to avoid the risk of long-term contract pricings with suppliers
                whose products are expected to see a decline in the average selling
                price.
                Industry experts believe that additional planned expansion of silicon
                processing factories coming on line over the next 18 months will
                produce enough raw materials to create an oversupply on projected
                demand.
                Failure to effectively manage our supply will hinder our expected
                growth
                and our component costs may have an adverse affect on the Company’s
                profitability; and





·
            Government
                subsidies: Federal and State subsidies relating directly to solar
                installations are an important factor in the planned growth of the
                solar
                industry. These subsidies are very important to growing the market
                for
                photovoltaic systems because they provide a significant economic
                incentive
                to all buyers. Without these incentives, industry growth would likely
                stall. These regulations are constantly being amended and will have
                a
                direct effect on our rollout of our planned franchise network among
                those
                states that offer superior incentives to the solar
                industry.




**Three
      Months Ended September 30, 2008 Compared to Three Months Ended September 30,
      2007**





***Expenses.*** Our
      expenses for continuing operations increased slightly, when comparing 2008
      to
      2007 for the three month period ending September 30. The increase is attributed
      mainly to costs
      related to the continued implementation of our solar business model As of
      September 30, 2008, the Company had 2 full-time employees and was relying on
      contractors to meet its financial and regulatory reporting
      requirements.





**Nine
      Months Ended September 30, 2008 Compared to Nine Months Ended September 30,
      2007**




***Expenses.*** Our
      expenses for continuing operations increased substantially, when comparing
      2008
      to 2007 for the nine month period ending September 30. The increase is
      attributed to two major factors: 1) expenses related to our exiting of the
      software business segment, and 2) expenses related to stock compensation granted
      to our new CEO and certain outside consultants.


*Table
          of Contents*






**Results
      of Operation**





SSC
      incurred a net loss of approximately $902,000 for the nine months ended
      September 30, 2008, and had a working capital deficit of approximately $856,000
      as of September 30, 2008. These conditions create an uncertainty as to SSC’s
      ability to continue as a going concern.





Cash
      provided by continuing operations was approximately $23,000 for the nine months
      ended September 30, 2008.  Cash used by discontinued operations was
      approximately $150,000 for the same period.  The funds to cover these uses
      of cash were received against the note payable and advance agreement the Company
      maintains from a shareholder.





SSC
      continues to rely on advances from third parties to fund operating shortfalls
      and does not foresee a change in this situation in the immediate future. There
      can be no assurance that SSC will continue to have such advances available.
      SSC
      will not be able to continue operations without them. SSC is pursuing alternate
      sources of financing.





**Critical
      Accounting Policies**


The
      financial reports for the period contained one additional critical accounting
      policy which was also an initial adoption of accounting policy that had a
      material impact. Below is a brief discussion of events that materially affected
      our financial statements and the basis in which the transactions were
      recorded.





DEVELOPMENT
      STAGE ENTERPRISE ***-*** As
      a
      result of the Company’s sale of ASPECT and SMSE, the Company is now considered a
      development stage enterprise pursuant to FASB Statement 7, which focuses on
      development stage companies. Users of the financial statements should be
      familiar with this statement and its effect on the financial
      statements.





**Internal
      Revenue Service Tax Lien**


During
      the second and third quarters of 2005, ASPECT, one of the Company’s former
      subsidiaries, did not have the funds necessary to cover all the payroll taxes.
      In January 2006, the Internal Revenue Service (“IRS”) placed a lien on ASPECT
      assets. A third party accounting firm which represented ASPECT, in the due
      process hearing, negotiated an installment plan to settle the outstanding
      liability. Payments were tendered from this third party firm on behalf of the
      Company’s largest shareholder and holder of a line of credit with ASPECT. The
      balance due at September 30, 2008 is approximately $38,000.





**Liquidity
      and Capital Resources**


Cash
      provided by operating activities was approximately $23,000 for the nine months
      ended September 30, 2008. During the nine months ended September 30, 2008,
      the
      Company borrowed and additional approximately $55,000 from a shareholder. In
      addition, the Company received advances under a finance agreement from a
      third-party in the amount of $44,500.





*Table
          of Contents*


**Risk
      Factors**


You
      should consider the following discussion of risks as well as other information
      regarding our common stock. The risks and uncertainties described below are
      not
      the only ones. Additional risks and uncertainties not presently known to us
      or
      that we currently deem immaterial also may impair our business operations.
      If
      any of the following risks actually occur, our business could be
      harmed.





**Competition**


SSC’s
      business strategy is to be a leading supplier of solar products and
      technologies, both domestically and internationally. SSC believes the following
      to be the keys and risks to its success: marketing of solar technologies through
      aggressive promotional campaigns to both commercial and consumer users,
      achieving economies of scale, research and development of solar and other
      alternative energy technologies, and establishing a rapport with distributors
      and installers interested in alternative energy systems. The alternative energy
      industry is relatively new, and a suitable customer base is not currently
      adequately defined. Given that the customer base may be narrow, it is possible
      that other solar technology providers may provide significant competition for
      these markets.





**Reliance
      on Key Personnel**


While
      certain of SSC’s officers and employees have extensive experience in business
      management, none of them have any prior experience in advising or managing
      an
      enterprise such as SSC.





**Sales
      Channels**


Sales
      channels for the distribution of solar technologies historically have been
      non-existent as solar systems have not been marketed on a state, regional or
      national level until just recently. There can be no assurance that SSC will
      create distribution channels large enough and financially strong enough to
      distribute its product at sufficient levels to attain profitability.





**Limited
      Operating History: Operating Losses**


Despite
      factors that indicate an increasing acceptance and desire to use solar power
      technologies in certain segments of the industry and government, SSC cannot
      be
      assured of their continued demand. While SSC believes that demand for such
      alternative energy sources exists, SSC cannot assure that it will have success
      in marketing its products to its customer groups. The inability of SSC to
      successfully market and sell its products to these customer groups would have
      an
      adverse effect on SSC’s profitability.





*Table
          of Contents*






**Going
      Concern**


The
      Company’s ability to continue as a going concern is an issue raised as a result
      of the significant operating losses incurred during the nine months ended
      September 30, 2008 and 2007 and its negative working capital. The Company
      continues to experience net operating losses. The ability to continue as a
      going
      concern is subject to the Company’s ability to obtain necessary funding from
      outside sources, including obtaining additional funding from the sale of
      securities, increasing sales or obtaining loans and grants from various
      financial institutions where possible.





**Additional
      Financing**


Additional
      financing is required to continue operations. Although actively searching for
      available capital, the Company does not have any current arrangements for
      additional outside sources of financing and cannot provide any assurance that
      such financing will be available.





**Limited
      Trading Market**


Currently
      only a very limited trading market exists for SSC common stock. The common
      stock
      trades on the OTCBB under the symbol "SSLR." The OTCBB is a limited market
      and
      subject to substantial restrictions and limitations in comparison to the NASDAQ
      system. Any broker/dealer that makes a market in the Company stock or other
      person that buys or sells the stock could have a significant influence over
      its
      price at any given time. The Company cannot assure its shareholders that a
      market for its stock will be sustained. There is no assurance that its shares
      will have any greater liquidity than shares that do not trade on a public
      market.









*Table
          of Contents*






**ITEM
      3:****QUANTITATIVE
      AND QUALITATIVE DISCLOSURES ABOUT MARKET RISKS**





As
      a
      smaller reporting company, we are not required to provide the information
      required by this Item.




**ITEM
      4T:****CONTROLS
      AND PROCEDURES**





**Management’s
      Report on Internal Control Over Financial Reporting.**


Our
      management is responsible for establishing and maintaining adequate internal
      control over financial reporting as defined in Rule 13a-15(f) under the
      Securities Exchange Act, as amended.  Our management assessed the
      effectiveness of our internal control over financial reporting as of December
      31, 2007 as seen in our 10KSB. In making this assessment, our management used
      the criteria set forth by the Committee of Sponsoring Organizations of the
      Treadway Commission (“COSO”) in Internal Control-Integrated
      Framework.  A material weakness is a deficiency, or a combination of
      deficiencies, in internal control over financial reporting, such that there
      is a
      reasonable possibility that a material misstatement of the company's annual
      or
      interim financial statements will not be prevented or detected on a timely
      basis.  We identified the following material weaknesses.





1.
            As
                of December 31, 2007, we did not maintain effective controls over
                the
                control environment.  Specifically, we have not formally adopted
                a written code of business conduct and ethics that governs to the
                Company’s employees, officers and directors.  Additionally, we
                have not developed and effectively communicated to our employees
                its
                accounting policies and procedures.  This has resulted in
                inconsistent practices.  Further, the Board of Directors does
                not currently have any independent members and no director qualifies
                as an
                audit committee financial expert as defined in Item 407(d)(5)(ii)
                of
                Regulation S-B.  Since these entity level programs have a
                pervasive effect across the organization, management has determined
                that
                these circumstances constitute a material
                weakness.





2.
            As
                of December 31, 2007 we did not maintain effective controls over
                financial
                statement disclosure.  Specifically, controls were not designed
                and in place to ensure that all disclosures required were originally
                addressed in our financial statements.   Accordingly, management
                has determined that this control deficiency constitutes a material
                weakness.





Because
      of these material weaknesses, management has concluded that the Company did
      not
      maintain effective internal control over financial reporting as of December
      31,
      2007, based on the criteria established in "Internal Control-Integrated
      Framework" issued by the COSO.





*Table
          of Contents*




**Changes
      in Internal Control Over Financial
      Reporting.**


No
      change
      in the Company’s internal control over financial reporting occurred during the
      quarter ended September 30, 2008, that materially affected, or is reasonably
      likely to materially affect, the Company’s internal control over financial
      reporting.





Corrective
      Action


None.






*Table
          of Contents*




**PART
      II. OTHER INFORMATION**





**ITEM
      1:****LEGAL
      PROCEEDINGS**





Other
      than as disclosed below, we know of no material, existing or pending legal
      proceedings against our company, nor are we involved as a plaintiff in any
      material proceeding or pending litigation.  There are no proceedings in
      which any of our directors, officers or affiliates, or any registered or
      beneficial shareholder, is an adverse party or has a material interest adverse
      to our interest.





In
      early
      2005, the landlord for the offices occupied by YCO Holdings, Inc. and its
      subsidiaries filed suit in the 295 th District
      Court of Harris County, Texas Cause No. 2005-04423 captioned WKB Value Partners,
      LP vs. Systems Management Solutions, Inc., alleging that the Company was
      obligated on the lease even though no authorized officer of the Company had
      signed the same. This lawsuit was dismissed in February, 2006 pursuant to a
      Comprehensive Settlement Agreement which required the Company to make payments
      to WKB Value Partners, LP in the amount of $470,000. The payment schedule called
      for $20,000 initial payment, followed by monthly payments of $7,500 for 60
      months. The Company is currently in default under the terms of the settlement
      agreement. As
      of
      September 30, 2008 the liability to WKB was approximately $307,500.





In
      December of 2006, Cargill Incorporated (“Cargill”), a Delaware corporation,
      filed suit in the Judicial District Court of Bexar County, Texas Cause No.
      2006-CI-19096, against subsidiary SMS Envirofuels, Inc., and certain related
      and
      unrelated companies and individuals, claiming non payment for amounts due
      Cargill by SMSE. The SMSE payable to Cargill as of October 5, 2006 is
      $608,387, which included $528,387 for material received and $80,000 for the
      hedge loss incurred by cancellation of the open physical contracts. On that
      same
      date, SMSE entered into an agreement to sell certain assets located at its
      production plant in Poteet, Texas. The purchaser, Earth Biofuels, Inc. (“EBOF”),
      as part of the agreement, expressly agreed to assume this debt to Cargill and
      provide additional working capital to SMSE. In return, SMSE signed a promissory
      note to EBOF for a line of credit not to exceed $788,000. Cargill agreed to
      this
      arrangement with EBOF but reserved the right to pursue any and all claims
      against SMSE upon failure of EBOF to adhere to the terms outlined in the
      agreement between EBOF and Cargill. EBOF subsequently made partial payments
      totaling $250,000 to Cargill, leaving a balance of $358,387. As of this filing,
      the purchase of the certain assets by EBOF has not occurred and there is not
      an
      expectation that a sale will occur in the future. Cargill was awarded a
      declaratory judgment in its favor. In July of 2007, Cargill reached a payout
      agreement with SMSE and certain related individuals. The balance, which includes
      interest and legal fees, totaled $380,000. The agreement required one payment
      of
      $75,000 due July 27, 2007 and monthly payments of $25,000 due the 1st of every
      month until the balance is paid in full, beginning with September 1, 2007.
      If in
      the event that SMSE or its certain related individual defaults on this
      agreement, Cargill will file and execute its judgment as it was awarded. During
      2007, SMSE and its affiliates made net payments of $128,000 towards the Cargill
      obligation. This liability was assumed by the new owners of SMSE when it was
      sold on August 20, 2008.





On
      May
      14,  2008
      the
      former CEO of the Company was served with a lawsuit, on behalf of the Company,
      relating to an unpaid Promissory Note between the Company and a shareholder.
      Current management has received a copy of this lawsuit and has begun discussions
      with the note holder’s representatives as to a potential settlement and can
      therefore make no statement as to the potential liability related
      thereto.




*Table
          of Contents*




**ITEM
      6****:****EXHIBITS
      AND REPORTS ON FORM 8-K**





(a)
            Exhibits:




Exhibit
              No.
            Description




31.1
            Section
                302 Certification - Eddie Austin,
                Jr.


32.1
              Section
                  906 Certification - Eddie Austin,
                  Jr.





(b)
            Reports
                on Form 8-K:





None.











SIGNATURES





Pursuant
      to the requirements of Section 13 or 15(d) of the Securities Exchange Act of
      1934, the Company has duly caused this report to be signed on its behalf by
      the
      undersigned, thereunto duly authorized.




Sunrise
      Solar Corporation






By: /s/
      Eddie
      Austin, Jr.


Eddie
      Austin, Jr.


Chairman
      & CEO


(Principal
      Executive Officer and Principal
      Accounting Officer)








Date:
      November 14, 2008