10-Q

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D. C.  20549

 FORM 10-Q

x   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

 OF THE SECURITIES EXCHANGE ACT OF 1934

For the Quarterly Period ended September 30, 2013

OR

¨   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

For the transition period from

 __________to __________

Commission File No.:     333-177532

ALTERNATIVE FUELS AMERICAS, INC.

(Exact name of registrant as specified in its charter)

Delaware	51-0347728
(State or other jurisdiction of  incorporation or organization)	(I.R.S. Employer Identification  Number)

2131 Hollywood Blvd.

Suite 401

Hollywood, Florida 33020

(Address of principal executive offices)

(954) 534-7895

(Issuer's telephone number)

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 past 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 has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).

Yes ¨           No  x

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

Large accelerated filer  o	Accelerated filer                     o
Non-accelerated filer    o	Smaller reporting company  x

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

Yes ¨       No x

As of November 19, 2013, the Issuer had 68,449,325 shares of its common stock outstanding

.

ALTERNATIVE FUELS AMERICAS, INC.

INDEX TO QUARTERLY REPORT

ON FORM 10-Q

Part  I – Financial Information		Page
Item 1.  Condensed Consolidated Financial Statements		3
	Condensed Consolidated Balance Sheet as of September 30, 2013 (unaudited) and December 31, 2012	3
	Condensed Consolidated Statements of Operations for the three and nine months ended September 30, 2013 and 2012 and for the period from inception to September 30, 2013 (unaudited)	4
	Condensed Consolidated Statements of Cash Flows for the Nine month periods ended September 30, 2013 and 2012(Unaudited)	5
	Notes to Condensed Consolidated Financial Statements	6-10
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	11-13
Item 3.	Quantitative and Qualitative Disclosures About Market Risk.	13
Item 4.	Controls and Procedures	13
Part II - Other Information		15
		15
Item 1.	Legal Proceedings	15
Item 1A.	Risk Factors
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	15
Item 3.	Defaults Upon Senior Securities	15
Item 4.	Removed and reserved	15
Item 5.	Other Information	15
Item 6.	Exhibits	15
Signatures		16

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PART I – FINANCIAL INFORMATION

Item 1. Condensed Consolidated Financial Statements:

Alternative Fuels Americas, Inc.
(A Development Stage Company)
Condensed Consolidated Balance Sheets
ASSETS
		September 30, 2013 (unaudited)			December 31, 2012
Current assets:
Cash	$	166		$	—
Total current assets		166			—
Property and equipment, net:		4,080			6,735
Trees		160,000			160,000
Total Assets	$	164,246		$	166,735
LIABILITIES AND NET CAPITAL DEFICIENCY
Current liabilities:
Accounts payable and accrued expenses	$	341,696		$	252,997
Accrued Interest		93,217			48,170
Current Portion of Installment Agreement		40,000			60,000
Loan Payable		783,307			672,800
Total current liabilities		1,258,220			1,033,967
Installment agreement		52,498			57,498
Total Liabilities		1,310,718			1,091,465
Commitments and Contingencies
Shareholders' deficit
Convertible preferred stock - Series C, $.001 par value; 10,000,000 shares authorized,
55,120 and 100,000 shares issued at June 30, 2013 and December 31, 2012 respectively		55			55
Common stock, $.001 par value; 250,000,000 shares authorized; 68,449,325 and 68,049,325
shares issued and outstanding at  September 30, 2013 and December 31, 2012, respectively		68,449			68,049
Additional paid-in capital		2,956,947			2,929,348
Deficit accumulated during the development stage		(4,171,923	)		(3,922,182	)
Net capital deficiency		(1,146,472	)		(924,730	)
	$	164,246		$	166,735
See accompanying notes to unaudited condensed consolidated financial statements.

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Alternative Fuels Americas, Inc.
(A Development Stage Company)
Condensed Consolidated Statements of Operations
(Unaudited)
	Three Months Ended						Nine Months Ended						from Inception to Sept. 30, 2013
	September 30, 2013			September 30, 2012			September 30, 2013			September 30, 2012
Revenue:
Sales	$	—		$	—		$	—		$	—		$	—
Cost of sales		—			—			—			—			—
Gross profit		—			—			—			—			—
Selling, general and administrative
Professional Fees		54,500			233,542			139,176			580,237			721,273
Salaries & Wages		2,920			10,254			13,105			70,754			85,105
Other		8,476			18,706			52,413			186,209			257,447
Loss from Operations		65,896			262,502			204,694			837,200			1,063,825
Other Income (Expenses)
Gain from Derecognition of stale liabilities											380,665
Interest		(15,493	)		(12,539	)		(45,047	)		(32,141	)		(90,239	)
Loss before Income tax	$	(81,389	)	$	(275,041	)	$	(249,741	)	$	(869,341	)	$	(773,399	)
Income Tax
Net Loss	$	(81,389	)	$	(275,041	)	$	(249,741	)	$	(869,341	)	$	(773,399	)
Weighted shares of common stock outstanding		68,249,325			64,729,048			68,249,325			64,729,048			68,249,325
Loss per share, primary and fully diluted		(0.00	)		(0.00	)		(0.00	)		(0.01	)		(0.01	)

See accompanying notes to unaudited condensed consolidated financial statements

.

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Alternative Fuels Americas, Inc.
(A Development Stage Company)
Condensed Consolidated Statements of Cash Flows
(Unaudited)
	Nine Months Ended
Cash flows from operating activities:	September 30, 2013			September 30, 2012
Net loss	$	(249,741	)	$	(869,341	)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation		3,776			3,018
Loss on asset disposal					4,131
Gain on settlement of accounts payable
Equity-based compensation
Securities issued in payment of liabilities
Merger-related costs
Changes in assets and liabilities:
Other assets
Accounts payable and accrued expenses		133,747			270,784
Net cash used in operating activities		(112,218	)		(591,408	)
Cash flows from investing activities:
Proceeds from Equipment disposal
Purchase of property and equipment		(1,122	)		—
Net cash used in investing activities		(1,122	)		—
Cash flows from financing activities:
Due to related parties		—			—
Proceeds from convertible promissory notes		18,000			—
Proceeds from installment agreement		—			—
Payments against installment agreement		—			—
Proceeds from stockholder loans		110,506			286,250
Proceeds from sale of common stock		10,000			27,500
Payments against installment payable		(25,000	)		(20,000	)
Net cash provided by financing activities		113,506			293,750
Net increase (decrease) in cash		166			(297,658	)
Cash at beginning of period		—			25,192
Cash at end of period	$	166		$	(272,466	)
Supplemental cash flow information:
Value of shares issued for conversion of convertible promissory notes		1,208,583			1,008,583
Value of shares issued in merger		6,567			6,567
Non-Cash Transaction: $18,000 loan payable was converted to $200 Common stocks and APIC $17,800.
See accompanying notes to unaudited condensed consolidated financial statements.

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NOTE 1 – ORGANIZATION AND NATURE OF THE BUSINESS

Organization

Alternative Fuels Americas, Inc. (“AFAI”, or the “Company”) is a development stage company. The Company was incorporated in 1993 and has engaged in a number of businesses. Its name was changed on May 11, 2007 to NetSpace International Holdings, Inc. (a Delaware corporation) (“NetSpace”). NetSpace acquired 100% of Alternative Fuels Americas, Inc. (a Florida corporation) in January 2010 in a stock-for-member interest transaction and issued 100,000 shares of Series C convertible preferred stock to existing shareholders. A Certificate of Amendment to the Certificate of Incorporation was filed in October 2010 changing the Company’s name from NetSpace International Holdings, Inc. to Alternative Fuels Americas, Inc. (a Delaware corporation).

The Company has a wholly-owned subsidiary, Alternative Fuels Costa Rica AFA-CR, LTDA, located in Costa Rica.

Nature of the Business

The Company intends to be a “seed–to-pump” biofuels company. Operations will be in Latin America and will include growing plants suitable for conversion into biofuels, extraction of crude oil from plant matter, refining the crude oil into international grade biodiesel, and selling the refined oil to end users in countries where the oil is produced.

Risks

The Company has been operating with extremely limited available cash and desperately needs additional sources of financing. See Note 2 and Note 10. If such financing is not obtained, the Company may have to curtail its operations.

The Company is subject to all the risks inherent in an early stage company in the biodiesel industry and has numerous competitors globally. These competitors may have more substantial resources and be able to succeed in manufacturing products faster than those that are contemplated by the Company’s plan of operations. Many of these competitors have substantially greater financial and technical resources and production and marketing capabilities than the Company, primarily in other parts of the world.

NOTE 2 - LIQUIDITY AND GOING CONCERN

The Company’s consolidated financial statements as of and for the nine months ended September 30, 2013 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company incurred a net loss of $523,658for the year ended December 31, 2012 and $249,741 for the nine months ended September 30, 2013. At September 30, 2013 the Company has a working capital deficiency of $1,258,054and is totally dependent on its ability to raise capital. The Company acknowledges that its Plan of Operations may not result in generating positive working capital in the near future. Although management believes that it will be able to successfully execute its business plan, which includes third-party financing and capital issuance, and meet the Company’s future liquidity needs, there can be no assurances in that regard. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this material uncertainty.

Management recognizes that the Company must generate additional funds to successfully develop its operations and activities to become a seed to pump Biofuels Company. Management plans include:

· the creation of Special Purpose Vehicles/Entities with which to generate capital for use in a geographic region,

· the sale of additional equity and debt securities,

· alliances and/or partnerships with entities interested in and having the resources to support the further development of the Company’s business plan,

· other business transactions to assure continuation of the Company’s development and operations.

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICES AND BASIS OF PRESENTATION

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company and the notes thereto have been prepared in accordance with the instructions for Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange commission (“SEC”). The December 31, 2012 condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited financial statements and the notes thereto that are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 filed with the SEC on April 24, 2013.

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The information presented as of September 30, 2013 and for the three and nine months ended September 30, 2013 has not been audited. In the opinion of management, the unaudited interim financial statements include all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the Company’s financial position as of September 30, 2013, the condensed consolidated results of its operations for the three and nine months ended September 30, 2013 and 2012, and its condensed consolidated changes in net capital deficiency and cash flows for the three and nine months ended September 30, 2013. These results of operations for the three and nine months ended September 30, 2013 and 2012 are not necessarily indicative of the results for the full year.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates, and the differences could be material.

Concentration of Credit Risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. Management believes the financial risks associated with these financial instruments are minimal. The Company places its cash with high credit quality financial institutions and makes short-term investments in high credit quality money market instruments of short-term duration. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits.

In November 2010 the Federal Deposit Insurance Corporation (“FDIC”) issued a final rule implementing section 343 of the Dodd-Frank Wall Street Reform and Consumer Protection Act that provides for unlimited insurance coverage of noninterest-bearing transaction accounts. At September 30, 2013 the Company had no interest-bearing accounts with balances in excess of FDIC-insured limits.

Cash and Cash Equivalents

The Company considers all investments purchased with original maturities of nine months or less to be cash and cash equivalents.

Fair Value of Financial Instruments

The Company follows the provisions of ASC 820. This Topic defines fair value, establishes and measurement framework and expands disclosures about fair value measurements.

The carrying amount of financial instruments including cash, accounts payable and accrued expenses, and notes payable approximates fair value at December 31, 2012 and September 30, 2013.

Property and Equipment

Furniture, fixtures and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which range from three to five years. Routine maintenance and repairs are charged to expense as incurred and major renovations or improvements are capitalized.

Trees

Trees consist of 40,000 Jatropha trees located on leased property in Costa Rica. Because the trees are being cultivated and maintained preparatory to having their fruit harvested for crushing and processing into oil, they have not been placed in service at September 30, 2013, and no depreciation has been provided.

Long-Lived Assets

The Company reviews long-lived assets and certain identifiable intangibles held and used for possible impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating the fair value and future benefits of its intangible assets, management performs an analysis of the anticipated undiscounted future net cash flow of the individual assets over the remaining amortization period. The Company recognizes an impairment loss if the carrying value of the asset exceeds the expected future cash flows. During the year ended December 31, 2012 and the Nine months ended September 30, 2013, there were no deemed impairments of long-lived assets.

Table of Contents 7

Earnings Per Share

In accordance with ASC 260, Earnings per Share, the Company calculates basic earnings per share by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share are computed if the Company has net income; otherwise it would be antidilutive, and would result from the conversion of a convertible note.

Income Taxes

The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes , as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes .  Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which the Company operates, estimates of future taxable income, and available tax planning strategies. If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria of ASC 740.

ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

Re-Classifications

Certain amounts in 2012 were reclassified to conform to the 2013 presentation. These reclassifications had no effect on consolidated net loss for the periods presented.

NOTE 4 – DEBT AND INSTALLMENT AGREEMENT

	September 30, 2013		December 31, 2012
Loan payable - stockholder, 8%, due on demand, unsecured	$	737,100	$	647,800
Loan payable- Stockholder, due on Nov 1,2013, unsecured ( 3)		10,000
Loan payable- Stockholder, due on Nov 1,2013, unsecured ( 4)		11,207
Convertible note - stockholder, 10%, due April 30, 2013,unsecured (1)		25,000		25,000
Convertible note - stockholder, 10%, due January 9, 2014, unsecured (2)		0		—
	$	783,307	$	672,800

(1) At the option of the holder the convertible note may be converted into shares of the Company’s common stock at the lesser of $0.40 or 20% discount to the market price, as defined, of the Company’s common stock. The Company is currently in discussions with the lender to reach a repayment agreement.

(2) On July 12, 2013 the loan was converted into 200,000 shares of the Company’s common stock.

(3) On July 1, 2013 the company received $10,000 loan from a shareholder.In consideration for Payee making the loan to AFAI, AFAI hereby extends to Payee a detached option (the “Option”) to purchase Five Hundred Thousand (500,000) shares of common stock in AFAI for a price of $.10 per share (the “Exercise Price”) for a period of three (3) years from the date of this note (the “Option Life”). In the event that AFAI completes a sale of stock at a price lower than $.10 per share during the Option Life (whether via a bona fide public offering, or a sale of restricted stock pursuant to rule 504 or any other form of exemption available to the company) then the Exercise Price of the option shall be adjusted to that price for the duration of the term of the Option Life.

(4) In September, 2013 a stockholder of the company agree to loan the company up to $25,000. To date $15,300 has been loaned. Interest (8%) will be accrued beginning January 1,2014

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The Company has an installment agreement covering the purchase of trees. The obligation is payable at the rate of $2,500 per month through October 2013 plus a payment of $30,000 in November 2013, November 2014 and November 2015.

NOTE 5 –STOCKHOLDERS’ EQUITY

The Company has 10,000,000 shares of preferred stock authorized with a par value of $0.001. The Board has the authority to issue the shares in one or more series and to fix the designations, preferences, powers and other rights, as it deems appropriate.

Each share of Series C convertible preferred stock (“Series C” or “Series C preferred stock”) has 433.9297 votes on any matters submitted to a vote of the stockholders of the Company and is entitled to dividends equal to the dividends of 433.9297 shares of common stock. Each share of Series C preferred stock is convertible at any time at the option of the holder into 433.9297 shares of common stock.

The Company has 250,000,000 shares of common stock authorized with a par value of $0.001. Each share of common stock has one vote per share for the election of directors and all other items submitted to a vote of stockholders. The common stock does not have cumulative voting rights, preemptive, redemption or conversion rights.

In 2012 the Company issued 300,000 shares of common stock to its directors and 3,043,194 shares of common stock to consultants. The shares were valued at $30,000 and $604,296, respectively, the fair value of the stock at the time.

The Company used a Level 3 fair value measurement to determine fair value, which are significant unobservable inputs as defined in ASC 820, previously SFAS No. 157 “Fair Value Measurements”. The 2012 shares were discounted 41% from the volume-weighted average price for the year to reflect marketability and minority interest discounts. The then market value of the stock was determined by using the value of shares being sold under the Company’s private placement in 2011 and with respect to trading on the OTCC BB in 2012.

In September, 2013 the Company sold 200,000 shares of common stock to shareholder at 5 cent per share.

In April 2013 the Company issued 3,043,194 shares of its common stock to members of management in settlement of $607,639 of accrued expenses. The effect of this transaction has been reflected in the accompanying consolidated balance sheet at December 31, 2012.

NOTE 6 –LEASES

The Company is obligated under operating lease agreements for its corporate office, which expires January 2014, and for land in Costa Rica for use in its planting and farming operations, which expire in 2020. Minimum future lease commitments are:

Year ended December 31:
	2013		7,100
	2014		4,700
	2015		4,500
	2016		4,500
	After 2016		26,500
	Total future minimum rental payments	$	47,300

There is an option to extend the Costa Rica lease for an additional 10 years.

Rent expense was $13,425 for the nine months ended September 30, 2013 and $17,838 for the year ended December 31, 2012.

NOTE 7 –STOCK OPTION PLAN

In 2011 the Company’s board of directors approved the Alternative Fuels America, Inc. 2011 Incentive Stock Plan (the “Plan”), which provides for equity incentives to be granted to the Company’s employees, executive officers or directors or to key advisers or consultants. Equity incentives may be in the form of stock options with an exercise price not less than the fair market value of the underlying shares as determined pursuant to the 2011 Incentive Stock Plan, restricted stock awards, other stock based awards, or any combination of the foregoing. The 2011 Incentive Stock Plan is administered by the board of directors. 2,500,000 shares of our common stock are reserved for issuance pursuant to the exercise of awards under the 2011 Incentive Stock Plan. No awards are outstanding at September 30, 2013.

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NOTE 8 –RELATED PARTY TRANSACTIONS

The Company has agreements covering its management personnel (See Note 11). Such agreements provide for minimum compensation levels and are subject to annual adjustment.

The Company’s Chief Executive Officer holds 50,000 shares of its Series C preferred stock. These shares can be converted into 21,696,485 shares of the Company’s common stock at his option.

The Company’s largest shareholder has from time to time provided unsecured loans to the Company which is due on demand and bear interest at 8%. At September 30, 2013 the aggregate amount of the loans was $737,100and accrued but unpaid interest amounted to $59,851. See Note 4.

A shareholder of the Company provided consulting services during the three months ended September 30, 2013, for $15,000 and during the nine months ended September 30, 2013 for $45,00; and loaned the Company $15,300 as of September 30,2013 to cover for certain operating expenses.

NOTE 9 –INCOME TAXES 

The Company has a deferred tax asset as shown in the following:

	2011			2012
Tax loss carryforward	$	975,485		$	1,169,000
Valuation allowance		(975,485	)		(1,169,000	)
	$	—		$	—

A valuation allowance has been recognized to offset the deferred tax assets because realization of such assets is uncertain. 

The Company has net operating loss carryforwards of approximately $3,398,000 at December 31, 2012 that expire beginning in 2025. However, utilization of these losses may be limited pursuant to Section 382 of the Internal Revenue Code due to a recapitalization in 2007 and subsequent stock issuances.

NOTE 10 – COMMITMENTS AND CONTINGENCIES

The Company has an Agrarian Parcel Lease Agreement with an independent third party giving it the option to lease 1,000 hectares of land in Costa Rica upon which it may commence a planting and farming program. This option expires in February 2014. By mutual agreement of the parties, the lease may be expanded to cover up to 5,000 hectares of land. The lease agreement, which would run through March 2030, provides for an initial semi-annual rental of $350 per hectare ($350,000 annually) for the first five years, increasing by $50 per hectare for each subsequent five-year period. In addition to planting and farming, crude oil extraction may also be performed on the land.

NOTE 11 – SUBSEQUENT EVENTS

The Company evaluates events and transactions occurring subsequent to the date of the financial statements for the matters requiring recognition or disclosure in the financial statements.

Effective January 1, 2013 the Company temporarily suspended compensation accruals for management personnel.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.

In this Quarterly Report on Form 10-Q, “Alternative Fuels Americas Inc.”, “AFAI” and the terms “Company”, “we”, “us” and “our” refer to Alternative Fuels Americas Inc. and its subsidiaries, unless the context indicates otherwise.

Forward-Looking Statements

This Quarterly Report on Form 10-Q includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. All statements other than statements of historical fact, including statements regarding guidance, industry prospects or future results of operations or financial condition, made in this Quarterly Report on Form 10-Q are forward-looking. We use words such as anticipates, believes, expects, future, intends and similar expressions to identify forward-looking statements. Forward-looking statements reflect management’s current expectations and are inherently uncertain. Actual results could differ materially for a variety of reasons, including those risks described in our Annual Report on Form 10-K for the year ended December 31, 2012 filed with the Securities and Exchange Commission (“SEC”) on April 24, 2013, and the risks discussed in other SEC filings. These risks and uncertainties as well as other risks and uncertainties could cause our actual results to differ significantly from management’s expectations. The forward-looking statements included in this Quarterly Report on Form 10-Q reflect the beliefs of our management on the date of this report. We undertake no obligation to update publicly any forward-looking statements for any reason.

Plan of Operations

The Company is a development-stage enterprise, and has conducted research and development since 2005 relating to plant trials and biofuels strategy development. Currently, AFAI has more than 40,000 Jatropha trees planted and a comprehensive growth plan in place. The Company’s business plan has 3 stages that result in the Company having (1) early-stage revenues, (2) ownership of feedstock supplies, and (3) an integrated R&D program to provide AFAI with proprietary intellectual property and improve operating margins for biodiesel manufacture. The Six phases are:

• Phase One – generation of early-stage revenues by utilizing feedstock from oil-rich crops that are growing wild on private farms. AFAI has negotiated long-term contracts with private farmers that will provide steady and secure access to this wild feedstock for up to 10 years.
• Phase Two - establish control over AFAI’s long-term feedstock needs through the implementation of a wide-scale planting and farming program of second generation oil-rich crops. This will provide the Company with the ability to maintain stable production and control costs. This phase will also include the construction of scalable refining capacity to produce 6 million gallons of bio diesel annually
• Phase Six - inclusion of third generation feedstock for additional efficiencies and yield expansion.

We have created the first Special Purpose Vehicle/Entity (“SPV”) with which to finance, construct and execute our business plan in a region of Costa Rica. We are establishing operations by (a) securing off-take agreements for the biofuel produced by the Company and (b) demonstrating the ability to cost-effectively grow and harvest feedstock with which to produce the biofuel.

Consequently, our plan of operations consists of:

· Raising the necessary capital through an SPV.

· Securing additional contracts for wild feedstock in addition to the signed agreements with 150 farmers in the Palmar area of Costa Rica, accounting for approximately 20,000 hectares (48,000 acres) of land.

· Securing additional contracts beyond the off-take agreements now signed that account for the sale of up to 3,700,000 gallons of biofuel annually.

· Negotiating for the purchase of modular transesterification facilities which will produce the biofuel.

However, we cannot assure that we will be successful in raising additional capital to implement our business plan. Further, we cannot assure, assuming that we raise additional funds, that we will achieve profitability or positive cash flow. If we are not able to timely and successfully raise additional capital and/or achieve profitability and positive cash flow, our operating business, financial condition, cash flows and results of operations may be materially and adversely affected.

Critical Accounting Estimates

The following are deemed to be the most significant accounting estimates affecting us and our results of operations.

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Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates, and the differences could be material

Cash and Cash Equivalents

The Company considers all investments purchased with original maturities of nine months or less to be cash and cash equivalents.

Fair Value of Financial Instruments

The Company follows the provisions of ASC 820. This Topic defines fair value, establishes and measurement framework and expands disclosures about fair value measurements.

Property and Equipment

Furniture, fixtures and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which range from Six to five years. Routine maintenance and repairs are charged to expense as incurred and major renovations or improvements are capitalized.

Long-Lived Assets

The Company reviews long-lived assets and certain identifiable intangibles held and used for possible impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating the fair value and future benefits of its intangible assets, management performs an analysis of the anticipated undiscounted future net cash flow of the individual assets over the remaining amortization period. The Company recognizes an impairment loss if the carrying value of the asset exceeds the expected future cash flows. During the year ended December 31, 2012 and the nine months ended September 30, 2013, there were no deemed impairments of long-lived assets.

Results of Operations

Nine months ended September 30, 2013 compared to Nine months ended September 30, 2012.

We had no revenue for the nine months ended September 30, 2013 and 2012. Management believes the most informative presentation is to present and comment on expenses.

Selling, General and Administrative Expenses

Selling, general and administrative expenses decreased $632,506 for the nine months ending September 2013 compared to the same period in 2012. The decrease results from a concerted effort by management to significantly lower operational costs. Expenses incurred in 2012 recur in 2013 and include compensation of consultants. Related legal and accounting fees decreased by approximately $440,000 in 2013. Travel expense primarily related to the Company’s Costa Rica operations decreased by approximately $33,000.

The selling, general and administrative expenses consists primarily of management and consulting fees ($112,473), professional fees ($37,176) resulting from regulatory requirements associated with Securities and Exchange Commission (“SEC”) filing and reporting requirements .

Interest Expense

The increase in interest expense is the result of increased debt principal in 2013 compared to 2012

Liquidity and Capital Resources

The Company has operated with extremely limited available cash. There are no current revenues, and the Company acknowledges that its Plan of Operations may not result in generating positive working capital in the near future. Although management believes that it will be able to successfully execute its business plan, which includes third-party financing and the raising of capital to meet the Company’s future liquidity needs, there can be no assurances in that regard. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this material uncertainty.

Table of Contents 12

At September 30, 2013 the Company has a working capital deficiency of $1,258,054, cash of $166and is dependent on its ability to raise capital for short-term funds. We received $18,700 of funding in Q3 2013 and need additional sources of financing. If such financing is not obtained, we may not be able to execute our Plan of Operations.

Management recognizes that the Company must generate additional funds to successfully develop its operations and activities to become a seed to pump Biofuels Company. Management plans include the sale of additional equity or debt securities, alliances or other partnerships with entities interested in and having the resources to support the further development of its business plans as well as other business transactions to assure continuation of the Company’s development and operations. The Company has been working on its plan to secure additional capital through a multi-part funding strategy.

Since January 2010, the Company has raised a total of $2,006,300in a series of private placements of debt and equity securities. However, we may not be successful in raising additional capital, and assuming that we raise additional funds, the Company may not achieve profitability or positive cash flow. If we are not able to timely and successfully raise additional capital and/or achieve profitability or positive cash flow, our business, financial condition, cash flows and results of operations may be materially and adversely affected.

Going Concern

The Company’s financial statements as of and for the nine months ended September 30, 2013 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company incurred a total net loss of $3,922,182from inception through the year ended December 31, 2012. The Company had a net loss of $249,741for the nine months ended September 30, 2013. At September 30, 2013 the Company had a working capital deficiency of $1,258,054, an accumulated deficit of $4,171,923and a net capital deficiency of $1,146,472. The lack of working capital has restricted the Company’s ability to implement its Plan of Operations. The Company needs to continue to incur expenditures to establish its ability to begin commercial operations. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this material uncertainty.

No assurances can be given that the Company will be successful in raising additional capital as discussed above. Further, there can be no assurance, assuming the Company successfully raises additional funds, that the Company will achieve profitability or positive cash flow. If the Company is not able to timely and successfully raise additional capital and/or achieve positive cash flow, its business, financial condition, cash flows and results of operations will be materially and adversely affected.

Recently Issued Accounting Pronouncements

Recent accounting pronouncements issued by the FASB, the American Institute of Certified Public Accountants (“AICPA”), and the Securities and Exchange Commission ("SEC") did not or are not believed by management to have a material impact on the Company’s present or future financial statements.

Off-Balance Sheet Arrangements

There are no off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not applicable.

Item 4. Controls and Procedures

(a) Evaluation of disclosure controls and procedures

Following the end of the period covered by this report, we conducted an evaluation under the supervision and with the participation of Craig Frank, our Chairman of the Board, President and Chief Executive Officer, and Ronen Ben-Harush, our Chief Financial Officer, of our disclosure controls and procedures (as defined in Rule 13a-15(e) and Rule 15d-15(e) of the Exchange Act) as of September, 2013 the end of the period covered by this report. Based on this evaluation, our Chairman of the Board, President and Chief Executive Officer and our Chief Financial Officer concluded that at September 30, 2013 our disclosure controls and procedures are effective to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms and that such information

Table of Contents 13

is accumulated and communicated to our management, including our principal executive officer and principal financial officer, or

(b) Changes in internal controls

There was no change in our internal controls or in other factors that could affect these controls during the quarter ended September 30, 2013 that has materially affected, or is reasonably likely to materially affect, our internal controls over financial reporting. Effective June 7, 2013 we engaged Ronen Ben-Harush as our Chief Financial Officer to replace our former Chief Financial Officer, Tom Bohannon. We do not anticipate any changes to our internal controls at this time.

Table of Contents 14

PART II – OTHER INFORMATION

Item 1. Legal Proceedings

None.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds.

None.

Item 3. Defaults Upon Senior Securities

None.

Item 4. Reserved and Removed.

None.

Item 5. Other Information

None

Item 6. Exhibits

Exhibit No.	Description
31.1	Certification of Craig Frank, Chief Executive Officer and President, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934.*
31.2	Certification of Ronen Ben-Harush, Chief Financial Officer, pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934.*
32.1	Certification of Craig Frank, Chief Executive Officer and President, pursuant to 18 U.S.C. 1350.*
32.2	Certification of Ronen Ben-Harush, Chief Financial Officer, pursuant to 18 U.S.C. 1350.*

* Filed herewith.

Table of Contents 15

SIGNATURES

In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Dated: November 19, 2013		ALTERNATIVE FUELS AMERICAS, INC.
	By:	/s/ Craig Frank
		Craig Frank, Chairman of the Board, President, and Chief Executive Officer (Principal Executive Officer )
	By:	/s/ Ronen Ben-Harush
		Ronen Ben-Harush, Chief Financial Officer ( Principal Financial and Accounting Officer)

Table of Contents 16

EX-31.1

Exhibit 31.1

CERTIFICATIONS

I, Craig Frank, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Alternative Fuels Americas, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal controls over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: November 19, 2013

/s/ Craig Frank

Craig Frank

Co-Chief Executive Officer and President

EX-31.2

Exhibit 31.2

CERTIFICATIONS

I, Ronen Ben-Harush, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Alternative Fuels Americas, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a) Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b) Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Dated: November 19, 2013

/s/ Ronen Ben-Harush

Ronen Ben-Harush

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Alternative Fuels Americas, Inc. (the “Company”) on Form 10-Q for the fiscal quarter ended September 3-0 21012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Craig Frank, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: November 19, 2013

/s/ Craig Frank

Craig Frank

Chief Executive Officer and President

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Quarterly Report of Alternative Fuels Americas, Inc. (the “Company”) on Form 10-Q for the fiscal quarter ended September 30, 2012 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Thomas J. Bohannon, certify, pursuant to 18 U.S.C. ss. 1350, as adopted pursuant to ss. 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

(1) The Report fully complies with the requirements of section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Dated: November 19, 2013

/s/ Ronen Ben-Harush

Ronen Ben-Harush

Chief Financial Officer

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NOTE 11. SUBSEQUENT EVENTS

9 Months Ended

Sep. 30, 2013

Subsequent Events [Abstract]

NOTE 11. SUBSEQUENT EVENTS

NOTE 11 – SUBSEQUENT EVENTS

The Company evaluates events and transactions occurring subsequent to the date of the financial statements for the matters requiring recognition or disclosure in the financial statements.

Effective January 1, 2013 the Company temporarily suspended compensation accruals for management personnel

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Statements of Operations (Unaudited) (USD $)	3 Months Ended		9 Months Ended		77 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013	Sep. 30, 2012	Sep. 30, 2013
Revenue:
Sales
Cost of sales
Gross profit
Selling, general and administrative
Professional Fees	54,500	233,542	139,176	580,237	721,273
Salaries & Wages	2,920	10,254	13,105	70,754	85,105
Other	8,476	18,706	52,413	186,209	257,447
Loss from Operations	65,896	262,502	204,694	837,200	1,063,825
Other Income (Expenses)
Gain from Derecognition of StaleLliabilities				380,665
Interest	(15,493)	(12,539)	(45,047)	(32,141)	(90,239)
Loss before Income tax	(81,389)	(275,041)	(249,741)	(869,341)	(773,399)
Net Loss	$ (81,389)	$ (275,041)	$ (249,741)	$ (869,341)	$ (773,399)
Weighted shares of common stock outstanding	68,249,325	64,729,048	68,249,325	64,729,048	68,249,325
Loss per share, primary and fully diluted	$ 0.00	$ 0.00	$ 0.00	$ (0.01)	$ (0.01)

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NOTE 4. DEBT AND INSTALLMENT AGREEMENT

9 Months Ended

Sep. 30, 2013

Debt Disclosure [Abstract]

NOTE 4. DEBT AND INSTALLMENT AGREEMENT

NOTE 4 – DEBT AND INSTALLMENT AGREEMENT

	September 30, 2013		December 31, 2012
Loan payable - stockholder, 8%, due on demand, unsecured	$	737,100	$	647,800
Loan payable- Stockholder, due on Nov 1,2013, unsecured ( 3)		10,000
Loan payable- Stockholder, due on Nov 1,2013, unsecured ( 4)		11,207
Convertible note - stockholder, 10%, due April 30, 2013,unsecured (1)		25,000		25,000
Convertible note - stockholder, 10%, due January 9, 2014, unsecured (2)		0		—
	$	783,307	$	672,800

(1) At the option of the holder the convertible note may be converted into shares of the Company’s common stock at the lesser of $0.40 or 20% discount to the market price, as defined, of the Company’s common stock. The Company is currently in discussions with the lender to reach a repayment agreement.

(2) On July 12, 2013 the loan was converted into 200,000 shares of the Company’s common stock.

(3) On July 1, 2013 the company received $10,000 loan from a shareholder.In consideration for Payee making the loan to AFAI, AFAI hereby extends to Payee a detached option (the “Option”) to purchase Five Hundred Thousand (500,000) shares of common stock in AFAI for a price of $.10 per share (the “Exercise Price”) for a period of three (3) years from the date of this note (the “Option Life”). In the event that AFAI completes a sale of stock at a price lower than $.10 per share during the Option Life (whether via a bona fide public offering, or a sale of restricted stock pursuant to rule 504 or any other form of exemption available to the company) then the Exercise Price of the option shall be adjusted to that price for the duration of the term of the Option Life.

(4) In September, 2013 a stockholder of the company agree to loan the company up to $25,000. To date $15,300 has been loaned. Interest (8%) will be accrued beginning January 1,2014

 The Company has an installment agreement covering the purchase of trees. The obligation is payable at the rate of $2,500 per month through October 2013 plus a payment of $30,000 in November 2013, November 2014 and November 2015.

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NOTE 4. DEBT AND INSTALLMENT AGREEMENT - Debt and Installment Agreements (Details) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Loan Payable 1
Loan Payable	$ 737,100	$ 647,800
Loan Payable 2
Loan Payable	10,000
Option to Purchase Number of Shares	500,000
Option Price Per Share	$ 0.10
Loan Payable 3
Loan Payable	11,207
Convertible Note 1
Loan Payable	25,000	25,000
Conversion Price Per Share		$ 0.40
Conversion Price Discount to Market		0
Convertible Note 2
Loan Payable	$ 0
Conversion Shares Issued	200,000

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NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICES AND BASIS OF PRESENTATION (Policies)

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company and the notes thereto have been prepared in accordance with the instructions for Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange commission (“SEC”). The December 31, 2012 condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited financial statements and the notes thereto that are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 filed with the SEC on April 24, 2013.

The information presented as of September 30, 2013 and for the three and nine months ended September 30, 2013 has not been audited. In the opinion of management, the unaudited interim financial statements include all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the Company’s financial position as of September 30, 2013, the condensed consolidated results of its operations for the three and nine months ended September 30, 2013 and 2012, and its condensed consolidated changes in net capital deficiency and cash flows for the three and nine months ended September 30, 2013. These results of operations for the three and nine months ended September 30, 2013 and 2012 are not necessarily indicative of the results for the full year.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates, and the differences could be material.

Concentration of Credit Risk

Concentration of Credit Risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. Management believes the financial risks associated with these financial instruments are minimal. The Company places its cash with high credit quality financial institutions and makes short-term investments in high credit quality money market instruments of short-term duration. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits.

In November 2010 the Federal Deposit Insurance Corporation (“FDIC”) issued a final rule implementing section 343 of the Dodd-Frank Wall Street Reform and Consumer Protection Act that provides for unlimited insurance coverage of noninterest-bearing transaction accounts. At September 30, 2013 the Company had no interest-bearing accounts with balances in excess of FDIC-insured limits.

Cash and Cash Equivalents

Cash and Cash Equivalents

The Company considers all investments purchased with original maturities of nine months or less to be cash and cash equivalents.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The Company follows the provisions of ASC 820. This Topic defines fair value, establishes and measurement framework and expands disclosures about fair value measurements.

The carrying amount of financial instruments including cash, accounts payable and accrued expenses, and notes payable approximates fair value at December 31, 2012 and September 30, 2013.

Property and Equipment

Property and Equipment

Furniture, fixtures and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which range from three to five years. Routine maintenance and repairs are charged to expense as incurred and major renovations or improvements are capitalized.

Trees

Trees

Trees consist of 40,000 Jatropha trees located on leased property in Costa Rica. Because the trees are being cultivated and maintained preparatory to having their fruit harvested for crushing and processing into oil, they have not been placed in service at September 30, 2013, and no depreciation has been provided.

Long-Lived Assets

Long-Lived Assets

The Company reviews long-lived assets and certain identifiable intangibles held and used for possible impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating the fair value and future benefits of its intangible assets, management performs an analysis of the anticipated undiscounted future net cash flow of the individual assets over the remaining amortization period. The Company recognizes an impairment loss if the carrying value of the asset exceeds the expected future cash flows. During the year ended December 31, 2012 and the Nine months ended September 30, 2013, there were no deemed impairments of long-lived assets.

Earnings Per Share

Earnings Per Share

In accordance with ASC 260, Earnings per Share, the Company calculates basic earnings per share by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share are computed if the Company has net income; otherwise it would be antidilutive, and would result from the conversion of a convertible note.

Income Taxes

Income Taxes

The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes , as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes .  Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which the Company operates, estimates of future taxable income, and available tax planning strategies. If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria of ASC 740.

ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

Re-Classifications

Re-Classifications

Certain amounts in 2012 were reclassified to conform to the 2013 presentation. These reclassifications had no effect on consolidated net loss for the periods presented.

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NOTE 6. LEASES (Details Narrative) (USD $)	9 Months Ended	12 Months Ended	60 Months Ended
	Sep. 30, 2013	Dec. 31, 2012	Dec. 31, 2017
Debt Disclosure [Abstract]
Rent Expense	$ 13,425	$ 17,838	$ 350,000

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NOTE 5. STOCKHOLDERS EQUITY (Details Narrative) (USD $)	9 Months Ended			12 Months Ended
	Sep. 30, 2013	Sep. 30, 2012	Dec. 31, 2012	Dec. 31, 2012 Director	Dec. 31, 2012 Consultants
Preferred Shares Authorized	10,000,000		10,000,000
Preferred Stock Par Value	$ 0.001		$ 0.001
Preferred Voting Rights	433.9297
Preferred Stock Dividends	$ 0
Convertible Preferred Stock Shares Issued Upon Conversion	433.9297
Common Stock Shares Authorizd	250,000,000		250,000,000
Common Stock Par Value	$ 0.001		$ 0.001
Common Stock Voting Rights	1
Common Stock Issued for Services				300,000	3,043,194
Common Stock Issued for Services Value				30,000	604,296
Common Shares Sold	200,000
Price Per Share	$ 0.05
Common Shares Issued In Settlement of Accrued Expenses	3,043,194
Settlement of Debt

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NOTE 9. INCOME TAXES Components of Income Tax Expense Benefit (Details Narrative) (USD $)	Dec. 31, 2012	Dec. 31, 2011
Income Tax Disclosure [Abstract]
Tax loss carryforward	$ 975,485	$ 1,169,000
Valuation allowance	(975,485)	(1,169,000)
Deferred Tax Asset

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NOTE 4. DEBT AND INSTALLMENT AGREEMENT (Details Narrative) (USD $)	9 Months Ended
	Sep. 30, 2013	Nov. 30, 2015	Nov. 30, 2014	Nov. 30, 2013
Debt Disclosure [Abstract]
Monthly Payment	$ 2,500
Payment on Installment Agreement		$ 30,000	$ 30,000	$ 30,000

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Statements of Cash Flows (Parenthetical) (USD $)	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Statement of Cash Flows [Abstract]
Loan Payable Value	$ 18,000
Additional Paid In Capital	$ 17,800

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NOTE 2. LIQUIDITY AND GOING CONCERN

9 Months Ended

Sep. 30, 2013

Organization, Consolidation and Presentation of Financial Statements [Abstract]

NOTE 2. LIQUIDITY AND GOING CONCERN

NOTE 2 - LIQUIDITY AND GOING CONCERN

The Company’s consolidated financial statements as of and for the nine months ended September 30, 2013 have been prepared on a going concern basis, which contemplates the realization of assets and the settlement of liabilities and commitments in the normal course of business. The Company incurred a net loss of $523,658for the year ended December 31, 2012 and $249,741 for the nine months ended September 30, 2013. At September 30, 2013 the Company has a working capital deficiency of $1,258,054and is totally dependent on its ability to raise capital. The Company acknowledges that its Plan of Operations may not result in generating positive working capital in the near future. Although management believes that it will be able to successfully execute its business plan, which includes third-party financing and capital issuance, and meet the Company’s future liquidity needs, there can be no assurances in that regard. These matters raise substantial doubt about the Company’s ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this material uncertainty.

Management recognizes that the Company must generate additional funds to successfully develop its operations and activities to become a seed to pump Biofuels Company. Management plans include:

· the creation of Special Purpose Vehicles/Entities with which to generate capital for use in a geographic region,

· the sale of additional equity and debt securities,

· alliances and/or partnerships with entities interested in and having the resources to support the further development of the Company’s business plan,

· other business transactions to assure continuation of the Company’s development and operations.

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NOTE 5. STOCKHOLDERS EQUITY

9 Months Ended

Sep. 30, 2013

Equity [Abstract]

NOTE 5. STOCKHOLDERS EQUITY

NOTE 5 –STOCKHOLDERS’ EQUITY

The Company has 10,000,000 shares of preferred stock authorized with a par value of $0.001. The Board has the authority to issue the shares in one or more series and to fix the designations, preferences, powers and other rights, as it deems appropriate.

Each share of Series C convertible preferred stock (“Series C” or “Series C preferred stock”) has 433.9297 votes on any matters submitted to a vote of the stockholders of the Company and is entitled to dividends equal to the dividends of 433.9297 shares of common stock. Each share of Series C preferred stock is convertible at any time at the option of the holder into 433.9297 shares of common stock.

The Company has 250,000,000 shares of common stock authorized with a par value of $0.001. Each share of common stock has one vote per share for the election of directors and all other items submitted to a vote of stockholders. The common stock does not have cumulative voting rights, preemptive, redemption or conversion rights.

In 2012 the Company issued 300,000 shares of common stock to its directors and 3,043,194 shares of common stock to consultants. The shares were valued at $30,000 and $604,296, respectively, the fair value of the stock at the time.

The Company used a Level 3 fair value measurement to determine fair value, which are significant unobservable inputs as defined in ASC 820, previously SFAS No. 157 “Fair Value Measurements”. The 2012 shares were discounted 41% from the volume-weighted average price for the year to reflect marketability and minority interest discounts. The then market value of the stock was determined by using the value of shares being sold under the Company’s private placement in 2011 and with respect to trading on the OTCC BB in 2012.

In September, 2013 the Company sold 200,000 shares of common stock to shareholder at 5 cent per share.

In April 2013 the Company issued 3,043,194 shares of its common stock to members of management in settlement of $607,639 of accrued expenses. The effect of this transaction has been reflected in the accompanying consolidated balance sheet at December 31, 2012

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NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICES AND BASIS OF PRESENTATION

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

NOTE 3. SUMMARY OF SIGNIFICANT ACCOUNTING POLICES AND BASIS OF PRESENTATION

NOTE 3 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICES AND BASIS OF PRESENTATION

Basis of Presentation

The accompanying unaudited condensed consolidated financial statements of the Company and the notes thereto have been prepared in accordance with the instructions for Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange commission (“SEC”). The December 31, 2012 condensed consolidated balance sheet data was derived from audited financial statements but does not include all disclosures required by accounting principles generally accepted in the United States of America. The unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited financial statements and the notes thereto that are included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2012 filed with the SEC on April 24, 2013.

The information presented as of September 30, 2013 and for the three and nine months ended September 30, 2013 has not been audited. In the opinion of management, the unaudited interim financial statements include all adjustments, consisting only of normal recurring adjustments, necessary to present fairly the Company’s financial position as of September 30, 2013, the condensed consolidated results of its operations for the three and nine months ended September 30, 2013 and 2012, and its condensed consolidated changes in net capital deficiency and cash flows for the three and nine months ended September 30, 2013. These results of operations for the three and nine months ended September 30, 2013 and 2012 are not necessarily indicative of the results for the full year.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosures of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates, and the differences could be material.

Concentration of Credit Risk

Financial instruments which potentially subject the Company to concentrations of credit risk consist principally of cash. Management believes the financial risks associated with these financial instruments are minimal. The Company places its cash with high credit quality financial institutions and makes short-term investments in high credit quality money market instruments of short-term duration. The Company maintains its cash in bank deposit accounts which, at times, may exceed federally insured limits.

In November 2010 the Federal Deposit Insurance Corporation (“FDIC”) issued a final rule implementing section 343 of the Dodd-Frank Wall Street Reform and Consumer Protection Act that provides for unlimited insurance coverage of noninterest-bearing transaction accounts. At September 30, 2013 the Company had no interest-bearing accounts with balances in excess of FDIC-insured limits.

Cash and Cash Equivalents

The Company considers all investments purchased with original maturities of nine months or less to be cash and cash equivalents.

Fair Value of Financial Instruments

The Company follows the provisions of ASC 820. This Topic defines fair value, establishes and measurement framework and expands disclosures about fair value measurements.

The carrying amount of financial instruments including cash, accounts payable and accrued expenses, and notes payable approximates fair value at December 31, 2012 and September 30, 2013.

Property and Equipment

Furniture, fixtures and equipment are stated at cost. Depreciation is calculated using the straight-line method over the estimated useful lives of the assets, which range from three to five years. Routine maintenance and repairs are charged to expense as incurred and major renovations or improvements are capitalized.

Trees

Trees consist of 40,000 Jatropha trees located on leased property in Costa Rica. Because the trees are being cultivated and maintained preparatory to having their fruit harvested for crushing and processing into oil, they have not been placed in service at September 30, 2013, and no depreciation has been provided.

Long-Lived Assets

The Company reviews long-lived assets and certain identifiable intangibles held and used for possible impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. In evaluating the fair value and future benefits of its intangible assets, management performs an analysis of the anticipated undiscounted future net cash flow of the individual assets over the remaining amortization period. The Company recognizes an impairment loss if the carrying value of the asset exceeds the expected future cash flows. During the year ended December 31, 2012 and the Nine months ended September 30, 2013, there were no deemed impairments of long-lived assets.

Earnings Per Share

In accordance with ASC 260, Earnings per Share, the Company calculates basic earnings per share by dividing net income (loss) by the weighted average number of common shares outstanding during the period. Diluted earnings per share are computed if the Company has net income; otherwise it would be antidilutive, and would result from the conversion of a convertible note.

Income Taxes

The Company accounts for income taxes in accordance with ASC 740, Accounting for Income Taxes , as clarified by ASC 740-10, Accounting for Uncertainty in Income Taxes .  Under this method, deferred income taxes are determined based on the estimated future tax effects of differences between the financial statement and tax basis of assets and liabilities given the provisions of enacted tax laws. Deferred income tax provisions and benefits are based on changes to the assets or liabilities from year to year. In providing for deferred taxes, the Company considers tax regulations of the jurisdictions in which the Company operates, estimates of future taxable income, and available tax planning strategies. If tax regulations, operating results or the ability to implement tax-planning strategies vary, adjustments to the carrying value of deferred tax assets and liabilities may be required. Valuation allowances are recorded related to deferred tax assets based on the “more likely than not” criteria of ASC 740.

ASC 740-10 requires that the Company recognize the financial statement benefit of a tax position only after determining that the relevant tax authority would more likely than not sustain the position following an audit. For tax positions meeting the “more-likely-than-not” threshold, the amount recognized in the financial statements is the largest benefit that has a greater than 50 percent likelihood of being realized upon ultimate settlement with the relevant tax authority.

Re-Classifications

Certain amounts in 2012 were reclassified to conform to the 2013 presentation. These reclassifications had no effect on consolidated net loss for the periods presented.

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NOTE 6. LEASES - Future Minimum Rental Payments (Details Narrative) (USD $)	Sep. 30, 2013
Debt Disclosure [Abstract]
Year ended December 31, 2013	$ 7,100
Year ended December 31, 2014	4,700
Year Ended December 31, 2015	4,500
Year Ended December 31, 2016	4,500
After 2016	26,500
Total future minimum rental payments	$ 47,300

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NOTE 9. INCOME TAXES (Details Narrative) (USD $)	Dec. 31, 2012
Income Tax Disclosure [Abstract]
Tax loss carryforward	$ 3,398,000

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Balance Sheets (Parenthetical) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Statement of Financial Position [Abstract]
Preferred Stock Par Value	$ 0.001	$ 0.001
Preferred Stock Shares Authorized	10,000,000	10,000,000
Preferred Stock Shares Issued	55,120	100,000
Preferred Stock Shares Outstanding	55,120	100,000
Common Stock Par Value	$ 0.001	$ 0.001
Common Stock Shares Authorized	250,000,000	250,000,000
Common Stock Shares Issued	68,449,325	68,049,325
Common Stock Shares Outstanding	68,449,325	68,049,325

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NOTE 8. RELATED PARTY TRANSACTIONS

9 Months Ended

Sep. 30, 2013

Related Party Transactions [Abstract]

NOTE 8. RELATED PARTY TRANSACTIONS

NOTE 8 –RELATED PARTY TRANSACTIONS

The Company has agreements covering its management personnel (See Note 11). Such agreements provide for minimum compensation levels and are subject to annual adjustment.

The Company’s Chief Executive Officer holds 50,000 shares of its Series C preferred stock. These shares can be converted into 21,696,485 shares of the Company’s common stock at his option.

The Company’s largest shareholder has from time to time provided unsecured loans to the Company which is due on demand and bear interest at 8%. At September 30, 2013 the aggregate amount of the loans was $737,100and accrued but unpaid interest amounted to $59,851. See Note 4.

A shareholder of the Company provided consulting services during the three months ended September 30, 2013, for $15,000 and during the nine months ended September 30, 2013 for $45,00; and loaned the Company $15,300 as of September 30,2013 to cover for certain operating expenses.

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Statements of Cash Flows (Unaudited) (USD $)	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2012
Cash flows from operating activities:
Net loss	$ (249,741)	$ (869,341)
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation	3,776	3,018
Loss on asset disposal		4,131
Gain on settlement of accounts payable
Equity-based compensation
Securities issued in payment of liabilities
Merger-related costs
Accounts payable and accrued expenses	133,747	270,784
Net cash used in operating activities	(112,218)	(591,408)
Cash flows from investing activities:
Purchase of property and equipment	(1,122)
Net cash used in investing activities	(1,122)
Cash flows from financing activities:
Due to related parties
Proceeds from convertible promissory notes	18,000
Proceeds from installment agreement
Payments against installment agreement
Proceeds from stockholder loans	110,506	286,250
Proceeds from sale of common stock	10,000	27,500
Payments against installment payable	(25,000)	(20,000)
Net cash provided by financing activities	113,506	293,750
Net increase (decrease) in cash	166	(297,658)
Cash at beginning of period		25,192
Cash at end of period	166	(272,466)
Supplemental cash flow information:
Value of shares issued for conversion of convertible promissory notes	$ 1,208,583	$ 1,008,583
Value of shares issued in merger	6,567	6,567

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Balance Sheets (Unaudited) (USD $)	Sep. 30, 2013	Dec. 31, 2012
Current assets:
Cash	$ 166
Total current assets	166
Property and equipment, net:	4,080	6,735
Trees	160,000	160,000
Total Assets	164,246	166,735
Current liabilities:
Accounts payable and accrued expenses	341,696	252,997
Accrued Interest	93,217	48,170
Current Portion of Installment Agreement	40,000	60,000
Loan Payable	783,307	672,800
Total current liabilities	1,258,220	1,033,967
Installment agreement	52,498	57,498
Total Liabilities	1,310,718	1,091,465
Commitments and Contingencies
Additional paid-in capital	2,956,947	2,929,348
Deficit accumulated during the development stage	(4,171,923)	(3,922,182)
Net capital deficiency	(1,146,472)	(924,730)
Total Liabilities and Stockholders Deficit	$ 164,246	$ 166,735

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NOTE 7. STOCK OPTION PLAN (Details Narrative)	Sep. 30, 2013
Accounting Policies [Abstract]
Common Stock Reserved for Future Issuance	2,500,000

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NOTE 2. LIQUIDITY AND GOING CONCERN (Details Narrative) (USD $)	9 Months Ended	12 Months Ended
	Sep. 30, 2013	Dec. 31, 2012
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Net Income (Loss)	$ 249,741	$ 523,658
Working Capital Deficiency	$ 1,258,054

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NOTE 7. STOCK OPTION PLAN

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

NOTE 7. STOCK OPTION PLAN

NOTE 7 –STOCK OPTION PLAN

In 2011 the Company’s board of directors approved the Alternative Fuels America, Inc. 2011 Incentive Stock Plan (the “Plan”), which provides for equity incentives to be granted to the Company’s employees, executive officers or directors or to key advisers or consultants. Equity incentives may be in the form of stock options with an exercise price not less than the fair market value of the underlying shares as determined pursuant to the 2011 Incentive Stock Plan, restricted stock awards, other stock based awards, or any combination of the foregoing. The 2011 Incentive Stock Plan is administered by the board of directors. 2,500,000 shares of our common stock are reserved for issuance pursuant to the exercise of awards under the 2011 Incentive Stock Plan. No awards are outstanding at September 30, 2013.

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NOTE 8. RELATED PARTY TRANSACTIONS (Details Narrative) (USD $)	3 Months Ended	9 Months Ended
	Sep. 30, 2013	Sep. 30, 2013	Dec. 31, 2012
Series C Preferred Stock Held by CEO	55,120	55,120	100,000
Preferred Stock Shares Issued Upon Conversion	433.9297	433.9297
Interest Rate	800.00%	800.00%
Related Party Debt	$ 737,100	$ 737,100
Interest Payable	59,851	59,851
Cost and Expenses Related Party	15,000	45,000
Loan from Shareholder	$ 15,300	$ 15,300
custom:CEOMember
Series C Preferred Stock Held by CEO	50,000	50,000
Preferred Stock Shares Issued Upon Conversion	21,696,485	21,696,485

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NOTE 10. COMMITMENTS AND CONTINGENCIES

9 Months Ended

Sep. 30, 2013

Commitments and Contingencies Disclosure [Abstract]

NOTE 10. COMMITMENTS AND CONTINGENCIES

NOTE 10 – COMMITMENTS AND CONTINGENCIES

The Company has an Agrarian Parcel Lease Agreement with an independent third party giving it the option to lease 1,000 hectares of land in Costa Rica upon which it may commence a planting and farming program. This option expires in February 2014. By mutual agreement of the parties, the lease may be expanded to cover up to 5,000 hectares of land. The lease agreement, which would run through March 2030, provides for an initial semi-annual rental of $350 per hectare ($350,000 annually) for the first five years, increasing by $50 per hectare for each subsequent five-year period. In addition to planting and farming, crude oil extraction may also be performed on the land.

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NOTE 6. LEASES

9 Months Ended

Sep. 30, 2013

Debt Disclosure [Abstract]

NOTE 6. LEASES

NOTE 6 –LEASES

The Company is obligated under operating lease agreements for its corporate office, which expires January 2014, and for land in Costa Rica for use in its planting and farming operations, which expire in 2020. Minimum future lease commitments are:

Year ended December 31:
	2013		7,100
	2014		4,700
	2015		4,500
	2016		4,500
	After 2016		26,500
	Total future minimum rental payments	$	47,300

There is an option to extend the Costa Rica lease for an additional 10 years.

Rent expense was $13,425 for the nine months ended September 30, 2013 and $17,838 for the year ended December 31, 2012

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NOTE 1. ORGANIZATION AND NATURE OF THE BUSINESS

9 Months Ended

Sep. 30, 2013

Accounting Policies [Abstract]

NOTE 1. ORGANIZATION AND NATURE OF THE BUSINESS

NOTE 1 – ORGANIZATION AND NATURE OF THE BUSINESS

Organization

Alternative Fuels Americas, Inc. (“AFAI”, or the “Company”) is a development stage company. The Company was incorporated in 1993 and has engaged in a number of businesses. Its name was changed on May 11, 2007 to NetSpace International Holdings, Inc. (a Delaware corporation) (“NetSpace”). NetSpace acquired 100% of Alternative Fuels Americas, Inc. (a Florida corporation) in January 2010 in a stock-for-member interest transaction and issued 100,000 shares of Series C convertible preferred stock to existing shareholders. A Certificate of Amendment to the Certificate of Incorporation was filed in October 2010 changing the Company’s name from NetSpace International Holdings, Inc. to Alternative Fuels Americas, Inc. (a Delaware corporation).

The Company has a wholly-owned subsidiary, Alternative Fuels Costa Rica AFA-CR, LTDA, located in Costa Rica.

Nature of the Business

The Company intends to be a “seed–to-pump” biofuels company. Operations will be in Latin America and will include growing plants suitable for conversion into biofuels, extraction of crude oil from plant matter, refining the crude oil into international grade biodiesel, and selling the refined oil to end users in countries where the oil is produced.

Risks

The Company has been operating with extremely limited available cash and desperately needs additional sources of financing. See Note 2 and Note 10. If such financing is not obtained, the Company may have to curtail its operations.

The Company is subject to all the risks inherent in an early stage company in the biodiesel industry and has numerous competitors globally. These competitors may have more substantial resources and be able to succeed in manufacturing products faster than those that are contemplated by the Company’s plan of operations. Many of these competitors have substantially greater financial and technical resources and production and marketing capabilities than the Company, primarily in other parts of the world.

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NOTE 10. COMMITMENTS AND CONTINGENCIES (Details Narrative) (USD $)	9 Months Ended	12 Months Ended	60 Months Ended
	Sep. 30, 2013	Dec. 31, 2012	Dec. 31, 2022	Dec. 31, 2017
Commitments and Contingencies Disclosure [Abstract]
Rent Expense Per Hectares				$ 350
Rent Expense	13,425	17,838		350,000
Increase in Rent Expense per Hectares			$ 50

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NOTE 4. DEBT AND INSTALLMENT AGREEMENT (Tables)

9 Months Ended

Sep. 30, 2013

Debt Disclosure [Abstract]

Debt and Installment Agreements

	September 30, 2013		December 31, 2012
Loan payable - stockholder, 8%, due on demand, unsecured	$	737,100	$	647,800
Loan payable- Stockholder, due on Nov 1,2013, unsecured ( 3)		10,000
Loan payable- Stockholder, due on Nov 1,2013, unsecured ( 4)		11,207
Convertible note - stockholder, 10%, due April 30, 2013,unsecured (1)		25,000		25,000
Convertible note - stockholder, 10%, due January 9, 2014, unsecured (2)		0		—
	$	783,307	$	672,800

(1) At the option of the holder the convertible note may be converted into shares of the Company’s common stock at the lesser of $0.40 or 20% discount to the market price, as defined, of the Company’s common stock. The Company is currently in discussions with the lender to reach a repayment agreement.

(2) On July 12, 2013 the loan was converted into 200,000 shares of the Company’s common stock.

(3) On July 1, 2013 the company received $10,000 loan from a shareholder.In consideration for Payee making the loan to AFAI, AFAI hereby extends to Payee a detached option (the “Option”) to purchase Five Hundred Thousand (500,000) shares of common stock in AFAI for a price of $.10 per share (the “Exercise Price”) for a period of three (3) years from the date of this note (the “Option Life”). In the event that AFAI completes a sale of stock at a price lower than $.10 per share during the Option Life (whether via a bona fide public offering, or a sale of restricted stock pursuant to rule 504 or any other form of exemption available to the company) then the Exercise Price of the option shall be adjusted to that price for the duration of the term of the Option Life.

(4) In September, 2013 a stockholder of the company agree to loan the company up to $25,000. To date $15,300 has been loaned. Interest (8%) will be accrued beginning January 1,2014

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NOTE 9. INCOME TAXES

9 Months Ended

Sep. 30, 2013

Income Tax Disclosure [Abstract]

NOTE 9. INCOME TAXES

NOTE 9 –INCOME TAXES 

The Company has a deferred tax asset as shown in the following:

	2011			2012
Tax loss carryforward	$	975,485		$	1,169,000
Valuation allowance		(975,485	)		(1,169,000	)
	$	—		$	—

A valuation allowance has been recognized to offset the deferred tax assets because realization of such assets is uncertain. 

The Company has net operating loss carryforwards of approximately $3,398,000 at December 31, 2012 that expire beginning in 2025. However, utilization of these losses may be limited pursuant to Section 382 of the Internal Revenue Code due to a recapitalization in 2007 and subsequent stock issuances

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NOTE 1. ORGANIZATION AND NATURE OF THE BUSINESS (Details Narrative)	Sep. 30, 2013	Dec. 31, 2012	Jan. 01, 2010
Percentage of Acquisition			100.00%
Preferred Stock Shares Issued	55,120	100,000
Series C Preferred Stock [Member]
Preferred Stock Shares Issued			100,000

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NOTE 6. LEASES (Tables)

9 Months Ended

Sep. 30, 2013

Debt Disclosure [Abstract]

Future Minimum Rental Payments

Year ended December 31:
	2013		7,100
	2014		4,700
	2015		4,500
	2016		4,500
	After 2016		26,500
	Total future minimum rental payments	$	47,300

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Document and Entity Information	9 Months Ended
	Sep. 30, 2013	Nov. 19, 2013
Document And Entity Information
Entity Registrant Name	Alternative Fuels Americas, Inc.
Entity Central Index Key	0001530746
Document Type	10-Q
Document Period End Date	Sep. 30, 2013
Amendment Flag	false
Current Fiscal Year End Date	--12-31
Is Entity a Well-known Seasoned Issuer?	No
Is Entity a Voluntary Filer?	No
Is Entity's Reporting Status Current?	Yes
Entity Filer Category	Smaller Reporting Company
Entity Common Stock, Shares Outstanding		68,449,325
Document Fiscal Period Focus	Q3
Document Fiscal Year Focus	2013

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NOTE 9. INCOME TAXES (Tables)

9 Months Ended

Sep. 30, 2013

Income Tax Disclosure [Abstract]

Components of Income Tax Expense Benefit

	2011			2012
Tax loss carryforward	$	975,485		$	1,169,000
Valuation allowance		(975,485	)		(1,169,000	)
	$	—		$	—