10-Q 1 g2370a.txt QTRLY REPORT FOR THE QTR ENDED 3-31-08 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) [X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarterly period ended March 31, 2008 or [ ] 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 333-137251 POWERRAISE, INC. (Exact name of registrant as specified in its charter) Nevada 98-0454140 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) c/o David Lubin & Associates, PLLC, 26 East Hawthorne Avenue, Valley Stream, New York 11580 (Address of principal executive offices) (Zip Code) Registrant's telephone number, including area code: (516) 887-8200 Not Applicable (Former name, former address and former fiscal year, if changed since last report) Indicate by check mark whether the registrant (l) 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 [ ] 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 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] (Do not check if a smaller reporting company) Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [X] No [ ] There were 38,293,332 shares of common stock, $0.0001 par value per share, outstanding on May 13, 2008. For purposes of this Quarterly Report, references to the "Company," "we," "us," and "our" mean Powerraise, Inc. FORWARD-LOOKING STATEMENTS This Quarterly Report contains "forward-looking statements." All statements other than statements of historical fact are "forward-looking statements." Forward-looking statements may include the words "may," "will," "estimate," "intend," "continue," "believe," "expect," "plan," or "anticipate" and other similar words. Such forward-looking statements may be contained in "Management's Discussion and Analysis or Plan of Operations" among other places. Although we believe the expectations reflected in our forward-looking statements are reasonable, actual results could differ materially from those projected or assumed in our forward-looking statements. Our future financial condition and results of operations, as well as any forward-looking statements, are subject to change and are subject to inherent risks and uncertainties, such as those disclosed in this Quarterly Report. Each forward-looking statement speaks only as of the date of the particular statement. 2 INDEX POWERRAISE, INC. Page PART I. FINANCIAL INFORMATION Item 1. Financial Statements 4 Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations 13 Item 3. Quantitative and qualitative disclosures about market risk 15 Item 4. Controls and procedures 15 PART II. OTHER INFORMATION Item 1. Legal Proceedings 15 Item 1A. Risk Factors 16 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 16 Item 3. Defaults Upon Senior Securities 16 Item 4. Submission of Matters to a Vote of Security Holders 16 Item 5. Other Information 16 Item 6. Exhibits 16 Signatures 17 3 PART I. FINANCIAL INFORMATION ITEM 1. FINANCIAL STATEMENTS POWERRAISE, INC. (A Development Stage Company) BALANCE SHEETS March 31, 2008

The accompanying notes are an integral part of these financial statements 4 POWERRAISE, INC. (A Development Stage Company) STATEMENT OF OPERATIONS March 31, 2008

---------- a = Less than ($0.01) per share The accompanying notes are an integral part of these financial statements 5 POWERRAISE, INC. (A Development Stage Company) STATEMENTS OF STOCKHOLDERS' EQUITY March 31, 2008

The accompanying notes are an integral part of these financial statements 6 POWERRAISE, INC. (A Development Stage Company) STATEMENT OF CASH FLOWS March 31, 2008

The accompanying notes are an integral part of these financial statements 7 POWERRAISE, INC. (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS March 31, 2008 NOTE 1. ORGANIZATION AND DESCRIPTION OF BUSINESS The Company was incorporated under the laws of the state of Nevada on March 11, 2005. The Company has limited operations and in accordance with SFAS #7, is considered a development stage company and has not yet realized any revenues from its planned operations. As a development stage enterprise, the Company discloses the deficit accumulated during the development stage and the cumulative statements of operations and cash flows from inception to the current balance sheet date. NOTE 2. SUMMARY OF SIGNIFICANT ACCOUNTING PRACTICES BASIS OF ACCOUNTING The Company's financial statements are prepared using the accrual method of accounting. The Company has elected a December 31 fiscal year end. EARNINGS PER SHARE In February 1997, the FASB issued SFAS No. 128, "Earnings Per Share", which specifies the computation, presentation and disclosure requirements for earnings (loss) per share for entities with publicly held common stock. SFAS No. 128 supersedes the provisions of APB No. 15, and requires the presentation of basic earnings (loss) per share and diluted earnings (loss) per share. The Company has adopted the provisions of SFAS No. 128 effective March 11, 2005 (inception). Basic earnings (loss) per share amount are computed by dividing the net income (loss) by the weighted average number of common shares outstanding. Diluted earnings (loss) per share are the same as basic earnings (loss) per share due to the lack of dilutive items in the Company. CASH EQUIVALENTS The Company considers all highly liquid investments with maturity of three months or less when purchased to be cash equivalents. ESTIMATED FAIR VALUE OF FINANCIAL INSTRUMENTS The carrying value of the Company's financial instruments, consisting of accounts payable and accrued liabilities approximate their fair value due to the short-term maturity of such instruments. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial statements. INCOME TAXES Income taxes are provided in accordance with Statement of Financial accounting Standards No. 109 (SFAS 109), Accounting for Income Taxes. A deferred tax asset or liability is recorded for all temporary differences between financial and tax reporting and net operating loss carryforwards. Deferred tax expense (benefit) results from the net change during the year of deferred tax assets and liabilities. Deferred tax assets are reduced by a valuation allowance when, in the opinion of management, it is more likely than not that some portion of all of the deferred tax assets will be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. 8 USE OF ESTIMATES The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America 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 revenue and expenses during the reporting period. Actual results could differ from those estimates. SOFTWARE DEVELOPMENT COSTS Software development costs representing capitalized costs of design, configuration, coding, installation and testing of the Company's website up to its initial implementation. Upon implementation, the asset will be amortized to expense over its estimated useful life of three years using the straight-line method. Ongoing website post-implementation costs of operation, including training and application maintenance, will be charged to expense as incurred. See Note 6. NOTE 3. WARRANTS AND OPTIONS As of March 31, 2008, there were 783,332 Class A warrants and 783,332 Class B warrants. See "Note 9". NOTE 4. GOING CONCERN The accompanying financial statements have been prepared assuming that the Company will continue as a going concern. The Company has net losses for the period from inception (March 11, 2005) to March 31, 2008 of $231,691. This condition raises substantial doubt about the Company's ability to continue as a going concern. The Company's continuation as a going concern is dependent on its ability to meet its obligations, to obtain additional financing as may be required and ultimately to attain profitability. The financial statements do not include any adjustments that might result from the outcome of this uncertainty. On September 1, 2006, we entered into loan arrangements with two of our shareholders,. They loaned us an aggregate amount of $35,000 and $5,000 and $30,000 respectively from each of two shareholders. The loans are due on September 1, 2008 and accrue interest at the rate of 24% per annum. We have the option to repay the loan at any time after December 31, 2006. On March 22, 2007 we repaid the $5,000 loan in full with interest of $667.39 for a total of $5,667.39. On November 1, 2007, we entered into loan arrangement with our director and officer. He loaned us an aggregate amount of $1,500. The loan is due on November 1, 2009 and bears no interest. On December 14, 2007 we repaid $27,912 of the $30,000 loan and invoiced the lender $2,088 for services rendered by the company. Interest on this loan was forgiven.. As of March 31, 2008 there is one loan outstanding to our director and officer, in the amount of $1,600. Management is planning to raise additional funds through debt or equity offerings. There is no guarantee that the Company will be successful in these efforts. NOTE 5. RELATED PARTY TRANSACTIONS Our director loaned the Company $7,500. The loan bears no interest and is payable on demand, not earlier than 36 months as witnessed by the promissory note dated March 14, 2005. On March 22, 2007 the company repaid the loan to its director and officer in the amount of $7,500. On November 1, 2007, we entered into loan arrangement with our director and officer. He loaned us an aggregate amount of $1,500. The loan is due on November 1, 2009 and bears no interest. The officers and directors of the Company are involved in other business activities and may, in the future, become involved in other business opportunities. If a specific business opportunity becomes available, such 9 persons may face a conflict in selecting between the Company and their other business interests. The Company has not formulated a policy for the resolution of such conflicts. NOTE 6. EQUIPMENT March 31, December 31, 2008 2007 -------- -------- Cost: Office and computer equipment $ 7,231 $ 7,231 Software development costs - website 28,988 28,988 -------- -------- 36,219 36,219 Less: Accumulated depreciation and amortization 27,746 25,140 -------- -------- Equipment, net $ 8,473 $ 11,079 ======== ======== The company depreciates all of its property and equipment on a straight line basis over 3 years. NOTE 7. INCOME TAXES The Company provides for income taxes under Statement of Financial Accounting Standards No. 109, ACCOUNTING FOR INCOME TAXES. SFAS No. 109 requires the use of an asset and liability approach in accounting for income taxes. Deferred tax assets and liabilities are recorded based on the differences between the financial statement and tax bases of assets and liabilities and the tax rates in effect currently. SFAS No. 109 requires the reduction of deferred tax assets by a valuation allowance if, based on the weight of available evidence, it is more likely than not that some or all of the deferred tax assets will not be realized. In the Company's opinion, it is uncertain whether they will generate sufficient taxable income in the future to fully utilize the net deferred tax asset. Accordingly, a valuation allowance equal to the deferred tax asset has been recorded. The total deferred tax asset is $34,795, which is calculated by multiplying a 15% estimated tax rate by the cumulative NOL of $231,691. NOTE 8. NET OPERATING LOSSES As of December 31, 2007, the Company has a net operating loss carry-forward of approximately $191,810, which will expire 20 years from the date the loss was incurred. NOTE 9. STOCKHOLDERS' EQUITY AUTHORIZED The Company is authorized to issue 1,000,000,000 shares of $0.0001 par value common stock. All common stock shares have equal voting rights, are non-assessable and have one vote per share. Voting rights are not cumulative and, therefore, the holders of more than 50% of the common stock could, if they choose to do so, elect all of the directors of the Company. On August 6, 2007 the company's board of directors, approved an increase in the authorized common shares from 100,000,000 to 1,000,000,000 by consent resolution. The company's articles were amended with the State of Nevada on August 22, 2007. ISSUED AND OUTSTANDING For transactions with other than employee's stock, issuances are in accordance with paragraph 8 of SFAS 123, where issuances shall be accounted for based on the fair value of the consideration received. Transactions with employee's stock issuance are in accordance with paragraphs (16-44) of SFAS 123, where issuances shall be accounted for based on the fair value of the consideration received or the fair value of the equity instruments issued, whichever is the more reliable measure. 10 On March 30, 2005, the Company issued 25,000,000 common shares (an aggregate of 50,000,000 shares) to each of its Directors for services rendered, valued at $ 0.0001 per share or $5,000. During the year ended December 31, 2005, the Company accepted subscriptions for 5,258,000 common shares from 17 investors under a private placement scheduled to close on June 30, 2006. The private placement was not subject to any minimum investment and was priced at $0.025 per share. The Company accepted the subscriptions on various dates throughout the year. During the six months ended June 30, 2006 the Company accepted further subscriptions on various dates throughout the period for 552,000 common shares from 24 investors under the private placement. The private placement closed on June 30, 2006. On June 12, 2007, the officers, directors and majority stockholders of the Company returned an aggregate of 30,000,000 shares of common stock to the Company for cancellation. On June 12, 2007, the officers, directors and majority stockholders of the Company, entered into a Stock Purchase and Sale Agreement (the "Agreement") which provided, among other things, for the sale of an aggregate of 20,000,000 shares of common stock of the Company (7,500,000 shares and 12,500,000 shares being sold respectively by our director for $.02 per share (the "Purchased Shares") to the buyers listed in such Agreement. The majority of the Purchased Shares (an aggregate of 14,432,350 shares) were purchased by an unaffiliated foreign person, and the balance of the Purchased Shares were purchased by twenty unaffiliated foreign persons. The source of the cash consideration for the Purchased Shares was the buyers' respective personal funds. On August 6, 2007, the company effected a 10 to 1 forward split of its 2,581,000 issued and outstanding common shares, resulting in 25,810,000 common shares on a post split basis. All shares and per share amounts have been retroactively restated to reflect the 10 for 1 forward stock split. On November 1, 2007 we raised $100,000 and issued 10,000,000 shares of our common stock, purchase price $0.01 per share, to 7 investors. We received net proceeds of $98,000. On November 1, 2007 On November 12, 2007 we raised $15,000 and issued 1,500,000 shares of our common stock, purchase price $0.01 per share, to 1 investor. We received net proceeds of $14,980. On November 12, 2007 On November 20, 2007, we issued 100,000 shares of common stock to the Company's legal counsel pursuant to the terms of the Engagement Agreement between the Company and the law firm. On December 4, 2007, the Company commenced a private placement offering of 8,333,333 Units for aggregate gross proceeds of $2,500,000, or $0.30 per Unit. Each Unit consisted of (i) one share of common stock, (ii) one Class A Warrant, and (iii) one Class B Warrant. Each Class A Warrant entitles the holder thereof to purchase one share of common stock at an exercise price of $0.45 per share, expiring on year from the date of purchase. Each Class B Warrant entitles the holder thereof to purchase one share of common stock at an exercise price of $0.75 per share, expiring three years from the date of purchase of the Unit. This offering was made to non-U.S. persons in offshore transactions pursuant to the exemption from registration provided by Regulation S of the Securities Act. On December 7, 2007, the Company issued Shlomo Friedman 100,000 shares in consideration for services previously provided. As of March 31, 2008 the Company accepted subscriptions from 8 investors for a total of 783,332 Units, raising an aggregate of $235,000. As of March 31, 2008 the Company had 38,293,332 shares of common stock issued and outstanding. STOCK PURCHASE WARRANTS During the year ended December 31, 2007, the Company closed a private placement whereby the Company issued 450,000 units for a total of $134,899. Each Unit consisted of (i) one share of common stock, (ii) one Class A Warrant, and (iii) one Class B Warrant. Each Class A Warrant entitles the holder thereof to purchase one share of common stock at an exercise price of $0.45 per share, expiring one year from the date of purchase. Each Class B Warrant entitles the holder thereof to purchase one share of common stock at an exercise price of 11 $0.75 per share, expiring three years from the date of purchase of the Unit. The consideration was allocated to the shares and warrants issued based upon the relative fair value. During January 2008, the Company closed a private placement whereby the Company issued 333,332 units for a total of $99,952. Each Unit consisted of (i) one share of common stock, (ii) one Class A Warrant, and (iii) one Class B Warrant. Each Class A Warrant entitles the holder thereof to purchase one share of common stock at an exercise price of $0.45 per share, expiring one year from the date of purchase. Each Class B Warrant entitles the holder thereof to purchase one share of common stock at an exercise price of $0.75 per share, expiring three years from the date of purchase of the Unit. The consideration was allocated to the shares and warrants issued based upon the relative fair value. A summary of the Company's outstanding stock purchase warrants as of March 31, 2008 is presented below: Shares and Allocated Warrants Value ---------- ---------- Common stock issued 783,332 $ 219,332 Series A Warrants issued 783,332 7,834 Series B Warrants issued 783,332 7,834 ---------- ---------- 2,349,996 $ 234,851 ========== ========== The value allocated to the warrants was estimated using the Black-Scholes option pricing model with the following assumptions: dividend yield of 0%, expected volatility of 916%, risk-free interest rate of 3.94% and expected lives of 1 year (Series A Warrants) and 3 years (Series B Warrants). NOTE 10. LONG-TERM DEBT Note payable to Mr. Shlomo Friedman an officer and director, bearing no interest and payable November 1, 2009 The company can repay any time $ 1,600 -------- $ 1,600 ======== NOTE 11. LOAN RECEIVABLE We entered into a Secured Convertible Promissory Note (the "Note") dated December 3, 2007, with Teleclick Technologies Ltd., a limited company organized in the State of Israel ("Teleclick"), pursuant to which the Registrant will lend Teleclick an aggregate of $300,000. The Note bears interest at the rate of 15% per annum, payable in cash. All accrued but unpaid interest on the Note and any other amounts due thereon is due and payable on December 3, 2008, or earlier upon acceleration following an event of default, as defined in the Note. All principal and accrued interest on the Note is convertible into ordinary shares of Teleclick up to an amount equal to 99% of Teleclick's authorized share capital on a fully diluted basis. On November 2, 2007 we paid Teleclick the sum of $82,000 in consideration for entering into the letter of intent, dated October 17, 2007. On December 5, 2007 we loaned Teleclick the sum of $90,000. On December 12, 2007we loaned Teleclick the sum of $25,000. On December 27, 2007 we loaned Teleclick the sum of $16,000. During January, 2008 we paid Teleclick the sum of $87,000. As of March 31, 2008 we loaned Teleclick a total amount of $300,000. 12 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS. Powerraise, Inc. (referred to in this Quarterly Report as "Powerraise", "us", "we" and "our") was incorporated under the laws of the State of Nevada on March 11, 2005. We have not generated any revenue to date and are a development stage company. Our initial focus was to become involved in the business of developing and marketing an internet commerce platform which enables schools to raise funds by collecting commissions from online shopping by parents and students. We are currently focused on negotiating and finalizing an arrangement with Teleclick, Ltd., an Israeli company which develops and provides a "Click-For-Free-Calls" application designed to initiate calls from a web page and send and receive emails and SMS text messages from a web page. BACKGROUND The Company and Teleclick entered in a Secured Convertible Promissory Note dated December 3, 2007, pursuant to which the Company agreed to lend Teleclick an aggregate amount of $300,000. By the end of January 2008, the Company had loaned Teleclick the entire aggregate amount of $300,000. The Note is secured by all the assets of Teleclick and Teleclick agreed not to sell, lease or otherwise dispose of any portion of such assets. Teleclick also agreed not to pay, declare or set apart for such payment, any dividend or other distribution on its capital stock or make any other payments or distribution in respect of its capital stock. The Note bears interest at the rate of 15% per annum, payable in cash. All accrued but unpaid interest on the Note and any other amounts due thereon is due and payable on December 3, 2008, or earlier upon acceleration following an event of default, as defined in the Note. At the option of the Company, at any time on or before December 3, 2008, all principal and accrued interest on the Note is convertible into ordinary shares of Teleclick up to an amount equal to 99% of Teleclick's authorized share capital on a fully diluted basis. PLAN OF OPERATION Our initial intention was to focus on becoming involved in the business of developing and marketing an internet commerce platform which would enable schools to raise funds by collecting commissions from online shopping by parents and students. Since our incorporation, we have conducted several private placements of our securities in order to raise capital needed to fund our business. The funds raised were primarily used by us to begin the development of our website. It is through this website and our agreement with LinkShare Corporation that we intended to provide schools with the opportunity to offer their students and parents the ability to purchase products from a variety of merchants. Purchases made would have generated commissions to the schools as long as the students and parents used our website to make purchases. During the fourth quarter of 2007, Cnaan Glishot, the web development company we had been using to develop our website went out of business. We were left with an unfinished and non-operational website and the need for additional funds we did not budget for. Accordingly, we decided to pursue other business opportunities. On October 17, 2007, we entered into Letter Agreement with Teleclick. Teleclick is a supplier of innovative and cost-effective Click-to-Call solutions, a process of converting Web-based traffic into direct telephony communication between an end user and an entity. These solutions enable Web users to use a "Teleclicker" in order to initiate and immediately receive telephone calls from a sales organization. On March 1, 2007, we subleased an office in Huntingdon Valley, PA, to be our US sales and marketing headquarters. Arik Hertz, our CEO, conducts his activity from there, building the infrastructure for Teleclick products and services, contact possible partners and customers, interviewing candidates, etc. Pursuant to the Letter of Agreement, Teleclick will enable the officers, accountants, counsel, bankers and other representatives of the Company to conduct a due diligence review of Teleclick, for the purposes of possibly acquiring that company. If we consummate such acquisition, we will then be involved in the business of Teleclick. If we do not consummate such acquisition, we will have to continue our search for another acquisition candidate. 13 RESULTS OF OPERATIONS Our company posted losses of $39,881 for the three months ended March 31, 2008 compared to $20,551 for the three months ended March 31, 2007. From inception to March 31, 2008 we have incurred losses of $231,691. The principal components of our losses for the three months ended March 31, 2008 included general and administrative costs of $4,440, management compensation of $19,383, Professional fees of $13,485 and amortization of our website & equipment of $2,606. This compares to general and administrative costs of $3,963 and Professional fees of $13,982 for the three months ended March 31, 2007. The reason for the approximately 94% increase in losses is a result of our management compensation. LIQUIDITY AND CAPITAL RESOURCES To date, we have had negative cash flows from operations and we have been dependent on sales of our equity securities and debt financing to meet our cash requirements. We expect this situation to continue for the foreseeable future. We anticipate that we will have negative cash flows from operations in the next twelve month period. At March 31, 2008, we had working capital of $5,976, compared to $219 at December 31, 2007. At March 31, 2008, our total assets consisted of cash of $5,976, loan receivable of $300,000, accounts receivable of $3,126 and property and equipment of $8,473, compared to cash of $219, loan receivable of $213,000, account receivable of $3,126 and property and equipment of $11,079 at December 31, 2007. There are no assurances that we will be able to obtain funds required for our continued operation. There can be no assurance that additional financing will be available to us when needed or, if available, that it can be obtained on commercially reasonable terms. If we are not able to obtain additional financing on a timely basis, we will not be able to meet our other obligations as they become due and we will be forced to scale down or perhaps even cease the operation of our business. Given that we are a development stage company and have not generated any revenues to date, our cash flow projections are subject to numerous contingencies and risk factors beyond our control, including the successful transaction with Teleclick, market acceptance of our products, competition from well-funded competitors, and our ability to manage our expected growth. We can offer no assurance that our company will generate cash flow sufficient to meet our cash flow projections or that our expenses will not exceed our projections. If our expenses exceed estimates, we will require additional monies during the next twelve months to execute our business plan. There is substantial doubt about our ability to continue as a going concern as the continuation of our business is dependent upon obtaining further long-term financing, successful development of our technologies into a marketable product and successful and sufficient market acceptance of our products once developed and, finally, achieving a profitable level of operations. The issuance of additional equity securities by us could result in significant dilution of the equity interests of our current stockholders. Obtaining commercial loans, assuming those loans would be available, will increase our liabilities and future cash commitments. GOING CONCERN Due to the uncertainty of our ability to meet current operating and capital expenses, our independent auditors included an explanatory paragraph regarding substantial doubt about our ability to continue as a going concern in their audit report for the period ended March 31, 2008. PURCHASE OF SIGNIFICANT EQUIPMENT We do not expect to purchase any significant equipment over the twelve months. EMPLOYEES Arik Hertz our Chief Executive Officer is our sole full time employee. In addition, we currently have one independent contractor who is responsible for our business development which includes building an infrastructure in the US for 14 the sales and marketing, contacting possible partners and customers. We expect no significant changes in the number of our employees other than such changes, if any, incident to our proposed acquisition of Teleclick. OFF-BALANCE SHEET ARRANGEMENTS Our company does not have any off-balance sheet arrangements, including any outstanding derivative financial statements, off-balance sheet guarantees, interest rate swap transactions or foreign currency contracts. Our company does not engage in trading activities involving non-exchange traded contracts. ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK. Smaller reporting companies are not required to provide the information required by Item 305 ITEM 4. CONTROLS AND PROCEDURES EVALUATION OF EFFECTIVENESS OF DISCLOSURE CONTROLS AND PROCEDURES As required by Rule 13a-15 under the 1934 Act, as of the end of the period covered by this quarterly report, being the fiscal quarter ended March 31, 2008, we have carried out an evaluation of the effectiveness of the design and operation of our disclosure controls and procedures. This evaluation was carried out under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based upon the results of that evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of the period covered by this quarterly report, our disclosure controls and procedures were effective and provide reasonable assurance that material information related to our company is recorded, processed and reported in a timely manner. Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, is responsible for the design of internal controls over financial reporting. The fundamental issue is to ensure all transactions are properly authorized and identified and entered into a well-designed, robust and clearly understood system on a timely basis to minimize risk of inaccuracy, failure to fairly reflect transactions, failure to fairly record transactions necessary to present financial statements in accordance with the U.S. GAAP, unauthorized receipts and expenditures or the inability to provide assurance that unauthorized acquisitions or dispositions of assets can be detected. The small size of our company makes the identification and authorization process relatively simple and efficient and a process for reviewing internal controls over financial reporting has been developed. To the extent possible given our company's small size, the internal control procedures provide for separation of duties for handling, approving and coding invoices, entering transactions into the accounts, writing checks and requests for wire transfers. As of March 31, 2008, our Chief Executive Officer and Chief Financial Officer conclude that our system of internal controls is adequate and comparable to those of issuers of a similar size and nature. There were no significant changes to our internal controls or in other factors that could significantly affect these controls during the most recent quarter ended March 31, 2008, including any significant deficiencies or material weaknesses of internal controls that would require corrective action. CHANGES IN INTERNAL CONTROLS OVER FINANCIAL REPORTING There have been no changes in the Company's internal control over financial reporting during the last quarterly period covered by this report that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial reporting. PART II. OTHER INFORMATION ITEM 1. LEGAL PROCEEDINGS. There are presently some disputes between the Company and Mr. Reuven Gamliel, the principal of Teleclick, regarding several commercial issues relating to the acquisition by the Company of Teleclick. Although the Company is hopeful that such disputes will be resolved amicably, there is no assurance that litigation will ensue. We know of no other existing or pending legal proceedings against us, nor are we involved as a plaintiff in any proceeding or pending litigation. There are no proceedings in which any of our directors, officers or any of their respective affiliates, or any beneficial shareholder, is an adverse party or has a material interest adverse to our interest. 15 ITEM 1A. RISK FACTORS. We incorporate by reference the risk factors set forth in our Annual Report on Form 10-K, filed on April 10, 2008. We know of no changes that would impact the content of the risk factors disclosed therein other than as set forth below. WE ARE CURRENTLY IN A DISPUTE WITH TELECLICK WHICH MAY NOT BE RESOLVED TO OUR SATISFACTION. We are currently negotiating with Teleclick over several commercial issues relating to the acquisition by the Company of Teleclick, including without limitation the ownership of the intellectual property of Teleclick. If these disputes are not resolved to our satisfaction and we can not collect the amounts owed to us by Teleclick, we will have no funds available for another business or acquisition. ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS. During the quarter ended March 31, 2008, the Company issued .333,332 units to 3 non-U.S. investors for a total of $100,000 of gross proceeds. Each Unit consisted of (i) one share of common stock, (ii) one Class A Warrant, and (iii) one Class B Warrant. Each Class A Warrant entitles the holder thereof to purchase one share of common stock at an exercise price of $0.45 per share, expiring one year from the date of purchase. Each Class B Warrant entitles the holder thereof to purchase one share of common stock at an exercise price of $0.75 per share, expiring three years from the date of purchase of the Unit. The Units were sold in a private placement held under Regulation S promulgated under the Securities Act of 1933, as amended (the "Act"). On February 27, 2008, the Company received an additional $30,000 for the purchase for an additional 100,000 Units, but such shares have not yet been issued. ITEM 3. DEFAULTS UPON SENIOR SECURITES. None. ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS. None. ITEM 5. OTHER INFORMATION. None. ITEM 6. EXHIBITS Number Exhibit Description ------- ----------- 3.1 Certificate of Incorporation of the Company incorporated herein from Exhibit 3.1 of our Registration Statement of Form SB-2, filed on September 12, 2006, file number 333-137251. 3.2 Bylaws of Company incorporated herein from Exhibit 3.2 of our Registration Statement of Form SB-2, filed on September 12, 2006, file number 333-137251. 31.1 Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer 31.2 Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer 32.1 Section 1350 Certification of Principal Executive Officer 32.2 Section 1350 Certification of Principal Financial Officer 16 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. POWERRAISE, INC. By: /s/ Arik Hertz --------------------------------------- Arik Hertz, Chief Executive Officer Dated: May 13, 2008 By: /s/ Shlomo Friedman --------------------------------------- Shlomo Friedman, President, Treasurer, Secretary and Director (Principal Financial and Accounting Officer) Dated: May 13, 2008 17

Powerraise Inc 10-Q