ACQUISITION OF SUBSIDIARIES

3 Months Ended

Mar. 31, 2012

DigiSpace Solutions, LLC Acquisition

On January 10, 2012, Bitzio Inc. and DigiSpace Solutions, LLC entered into a share exchange agreement wherein Bitzio, Inc. acquired 100 percent of the issued and outstanding members’ equity in exchange for $200,000 in cash and 1,000,000 restricted stock options at an exercise price of $0.28 per share valued at $513,150. Through this transaction DigiSpace Solutions, LLC became a wholly owned subsidiary of Bitzio, Inc.

The assets and liabilities of DigiSpace Solutions, LLC as of the acquisition date will be recorded at their estimated fair value. A preliminary allocation of the purchase price is as follows:

Cash and cash equivalents	$	12,830
Customer List		1,381,545
Total assets acquired		1,394,375

Accounts payable		501,706
Deferred revenue		35,523
Notes payable		143,996
Total liabilities acquired		681,225
Net assets acquired	$	713,150