SUBSEQUENT EVENTS

3 Months Ended

Mar. 31, 2012

Notes to Financial Statements

SUBSEQUENT EVENTS

NOTE 11: SUBSEQUENT EVENTS.

 (a) On April 5, 2012, for gross proceeds of $25,000 the Company sold 500,000 shares of common stock and warrants to purchase additional 100,000 shares of common stock at an exercise price of $0.06.  The warrants have a term of three years.

(b) Subsequent to the quarter ended March 31, 2012 and through May 13, 2012, the Company issued multiple convertible notes for aggregate gross proceeds of $154,684 to multiple lenders.  The Company issued the lenders for each loan, a convertible promissory note bearing interest between 6% and 8% per annum with maturity dates ranging from October 23, 2012 through December 29, 2012. The loans and accrued interest are to be paid on the maturity dates.  Each loan is evidenced by the promissory note the Company issued to the lender which contains conversion clauses that allow the lenders the option to convert the loan amount plus all accrued and unpaid interest due under the note into common stock. Each of the three notes contains variable conversion prices ranging from 65% to 80% multiplied by the market price (representing discounts rates of 20% to 35%).  

(c) On April 23, 2012, the Company received $100,000 as a deposit for a FRWS unit purchased by the Government of Mexico, to be used in the State of Veracruz. This sale represents PureSafe Water Systems' first international sale. 

(d) Subsequent to the period ended March 31, 2012 and through May 15, 2012, the Company issued a total of 1,130,912 shares of common stock upon receiving the requests from multiple lenders to convert a total of $35,000 loan principal and accrued interest into the Company’s common stock.  

(e) On April 2, 2012, the Company issued a total of 1,302,085 warrants of common stock to its five directors, including warrants issued to the Chief Executive Officer and Chief Financial Officer, each of which received 260,417 warrants for their 2nd quarter of 2012 director fees.  The issuance is part of the annual compensation that was authorized by the Company’s Board of Directors on December 6, 2011, when the Board approved to replace directors annual compensation of $50,000 with three year warrants payable quarterly. The Company recorded $39,500 stock-based compensation in connection with this issuance.