v3.4.0.3

Goodwill and Intangible Assets | 12 Months Ended
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Dec. 31, 2015
Goodwill and Intangible Assets Disclosure [Abstract] |
Goodwill and Intangible Assets |
NOTE 7 | GOODWILL AND INTANGIBLE ASSETS
In November 2013, the Company entered into a Distribution Agreement with E-motion Apparel, Inc., which designs women’s apparel and accessories. The agreement grants Bitzio the exclusive worldwide right to distribute E-motion Apparel’s products using the E-motion Apparel trademarks, copyrights and trade dress. The agreement also provides that Bitzio will make a five year non-interest-bearing $75,000 working capital loan to E-motion Apparel, and will pay a license fee of $300,000 to E-motion Apparel. The Distribution Agreement was replaced by the acquisition agreement on July 18, 2014. On July 16, 2014, the Company acquired 100% of the stock of Lexi Luu Designs, Inc. (“LL”), in exchange for 500,000,000 shares of Company common stock, plus a subordinate term note in the amount of $300,000 payable from LL on or before December 31, 2017, subject to compliance with applicable provisions of the Company’s senior loan agreements. We accounted for the transaction as an equity purchase. $183,629 of the purchase price paid was allocated among the assets and liabilities and the difference was allocated to intangible assets in the amount of $690,629. As of December 31, 2015 and 2014, the net carrying amount is $186,376 and $531,690, respectively. The associated intangible asset is being amortized over a life of 2 years. On July 18, 2014, the Company acquired 100% of the stock of E-motion Apparel, Inc. (“EA”), in exchange for 350,000,000 shares of Company common stock, plus a subordinate term note in the amount of $300,000 payable from EA on or before December 31, 2017, subject to compliance with applicable provisions of the Company’s senior loan agreements. We accounted for the transaction as an equity purchase. $26,235 of the purchase price paid was allocated among the assets and liabilities and the difference was allocated to intangible assets in amount of $74,235. As of December 31, 2015 and 2014, the net carrying amount is $20,236 and $57,354. The associated intangible asset is being amortized over a life of 2 years. Under our agriculture segment, GreenShift accounts for its intangible assets pursuant to ASC 350-20-55-24, “Intangibles – Goodwill and Other”. Under ASC 350, intangibles with definite lives continue to be amortized on a straight-line basis over the lesser of their estimated useful lives or contractual terms. Intangibles with indefinite lives are evaluated at least annually for impairment by comparing the asset’s estimated fair value with its carrying value, based on cash flow methodology. Intangibles with definite lives are subject to impairment testing in the event of certain indicators. Impairment in the carrying value of an asset is recognized whenever anticipated future cash flows (undiscounted) from an asset are estimated to be less than its carrying value. The amount of the impairment recognized is the difference between the carrying value of the asset and its fair value. The Company’s intangible assets at December 31, 2015 and 2014, respectively, include the following:
|  | 2015 |  |  | 2014 |
License fees |  | $ | 150,000 |  |  | $ | — |
Patent |  |  | 50,000 |  |  |  | — |
Website |  |  | 45,076 |  |  |  | — |
Customer relation |  |  | 764,864 |  |  |  | 764,864 |
Accumulated amortization |  |  | (785,351 | ) |  |  | (175,820 | )
Intangible assets, net |  | $ | 224,589 |  |  | $ | 589,044 |
Amortization of intangible assets is computed using the straight-line method and is recognized over the estimated useful lives of the intangible assets. Amortization of intangible assets was $385,634 and $209,085 for the twelve months ended December 31, 2015 and 2014, respectively. Estimated amortization expense for future years is as follows:
2016 |  | $ | 209,814 |
2017 |  |  | 3,202 |
2018 |  |  | 3,202 |
2019 |  |  | 3,202 |
2020 |  |  | 3,202 |
Thereafter |  |  | 1,967 |
Total |  | $ | 224,589 |

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