United states

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

[X]quarterly report under section 13 0r 15(d) of the securities exchange act of 1934

For the quarterly period endedSeptember 30, 20172022

[  ]transition report under section 13 0r 15(d) of the securities exchange act of 1934

For the transition period from ___________________to ___________________________________________ to _______________________

Commission file number000-51302

madison technologies inc.

Madison Technologies Inc.

(Exact name of registrant as specified in its charter)

Nevada00-000000085-2151785

(State or other jurisdiction of

incorporation or organization)

(I.R.S. Employer

Identification No.)

4448 Patterdale Drive, North Vancouver, BC61 East 80th Street, New York, NYV7R 4L810075
(Address of principal executive offices)(Zip Code)

(212)518-4177
(Registrant’s telephone number, including area code)

n/a
(Former name, former address and former fiscal year, if changed since last report)

206-203-0474

(Registrant’s telephone number, including area code)

n/a

(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the registrant (1) filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 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.

[X] Yes [  ] 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 (s. 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).

[X] Yes [  ] No

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

Larger accelerated filer[  ]Accelerated filer[  ]
Non-accelerated filer[  ]Smaller reporting company[X]
(Do not check if a smaller reporting company)

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

[  ] Yes [X] No

Applicable only to corporate issuers

State the number of shares outstanding of each of the issuer’s classes of common equity, as of the latest practicable date.

ClassOutstanding at September 30, 2017November 10, 2022
Common Stock - $0.001 par value12,257,5651,599,095,027

 

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 2

MADISON TECHNOLOGIES INC.

INTERIM Financial Statements

SEPTEMBER 30, 20172022 and 2021

(unaudited)

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 3

MADISON TECHNOLOGIES INC.

(UNAUDITED)

TABLE OF Contents

INTERIMCONDENSED CONSOLIDATED FINANCIAL STATEMENTS
Interim Balance Sheets4
Interim Statements of Operations5
Interim Statements of Stockholders’ DeficiencyDeficit6
Interim Statements of Cash Flows7
Interim Notes to the Financial Statements8-228-29

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 4

MADISON TECHNOLOGIES INC.

INTERIMcondensed consolidated Balance Sheets

(UNAUDITED)(Unaudited)

  September 30,  December 31, 
  2017  2016 
       
ASSETS        
         
CURRENT ASSETS        
Cash $4,720  $14,259 
         
   4,720   14,259 
         
Intangible asset, at amortized cost
License agreement (Note 5)
  24,010   42,760 
         
Total Assets $28,730  $57,019 
         
LIABILITIES AND STOCKHOLDERS’ DEFICIENCY        
         
CURRENT LIABILITIES        
Accounts payable and accrued liabilities $37,696  $36,510 
License fee payable (Note 5)  33,500   33,500 
Notes and accrued interest payable (Note 6)  121,839   114,683 
Convertible notes payable (Note 8, 9)  145,970   146,013 
Related party advance (Note 7)  261   261 
         
TOTAL LIABILITIES  339,266   330,967 
         
STOCKHOLDERS’ DEFICIT        
Common Stock (Note 8)
Par Value: $0.001
Authorized 500,000,000 shares
Issued and outstanding: 12,257,556 shares
(Dec 31, 2016 - 11,302,000 shares)
  12,257   11,302 
Additional Paid in Capital  302,387   285,600 
Accumulated deficit  (625,180)  (570,850)
         
Total stockholders’ deficiency  (310,536)  (273,948)
         
Total liabilities and stockholders’ deficiency $28,730  $57,019 
  September 30, 2022  December 31, 2021 
ASSETS        
         
CURRENT ASSETS        
Cash $8,804  $55,656 
Accounts receivables, net  103,536   167,800 
Note receivables  817,534   749,603 
Due (to) from related party  (28,658)  709,259 
Total Current Assets  901,216   1,682,318 
Intangible assets, net  12,221,439   12,196,646 
Equipment, net  1,344,344   1,486,347 
Investments  101   101 
Operating lease right-of-use assets, net  1,320,650   1,400,980 
         
Total Assets $15,787,750  $16,766,392 
         
LIABILITIES AND STOCKHOLDERS’ DEFICIT        
         
CURRENT LIABILITIES        
Accounts payable and accrued expenses $1,447,336  $791,802 
Derivative liability  4,159,329   3,464,529 
Current portion of lease liabilities  -   3,767 
Promissory notes  916,223   491,741 
Convertible notes payable  1,770,199   850,000 
Interest payable on senior secured notes  2,475,000   453,750 
Total current liabilities  10,768,087   6,055,589 
Long term portion of lease liability obligations  1,466,584   1,464,728 
Long term convertible notes, net of discount  14,175,827   12,919,392 
         
Total liabilities  26,410,498   20,439,709 
         
Preferred Shares - Series C, $0.001 par value; 2%, stated value $100 per share 10,000 shares designated, 0 issued and outstanding, September 30, 022 and December 31, 2021, respectively;  -   - 
Preferred Shares - Series D, $0.001 par value; convertible, stated value $3.32 per share, 230,000 shares designated, 155,000 and 0 shares issued and outstanding, September 30, 2022 and December 31, 2021, respectively; 75,000 converted  155   155 
Preferred Shares - Series E, $0.001 par value; convertible, stated value $1,000 per share, 1,000 shares designated, 0 issued and outstanding, September 30, 2022 and December 31, 2021, respectively; 1,000 shares exchanged to Series E-1  -   - 
Preferred Shares - Series E-1, $0.001 par value; convertible, stated value $0.87 per share, 1,152,500 shares designated, 1,152,500 and 0 shares issued and outstanding, September 30, 2022 and December 31, 2021, respectively;  1,153   1,153 
Preferred Shares - Series F, $0.001 par value; convertible, stated value $1 per share, 1,000 shares designated, 0 issued and outstanding, September 30, 2022 and December 31, 2021, respectively; 1,000 shares converted  -   - 
Preferred Shares - Series G, $0.001 par value; convertible, stated value $1,000 per share, 4,600 shares designated, 0 issued and outstanding, September 30, 2022 and December 31, 2021, respectively; 4,600 shares converted  -   - 
Preferred Shares – Series H, $0.001 par value; convertible, stated value $1 per share, 39,895 shares designated, issued and outstanding, September 30, 2022 and December 31, 2021, respectively;  40   40 
Temporary equity value        
         
STOCKHOLDERS’ DEFICIT        
Capital Stock:        
Preferred Shares – 50,000,000 shares authorized, $0.001 par value Preferred Shares - Series A, $0.001 par value; 3%, stated value $100 per share 100,000 shares designated, 0 shares issued and outstanding, September 30, 2022 and December 31, 2021, respectively;  -   - 
Preferred Shares - Series B, $0.001 par value; 100 shares designated, 100 shares issued and outstanding, September 30, 2022 and December 31, 2021, respectively  -   - 
Preferred Stock value       
         
Common Shares - $0.001 par value; 6,000,000,000 shares authorized 1,599,095,027 shares issued and outstanding, September 30, 2022 and December 31, 2021, respectively  1,599,095   1,599,095 
Additional paid in capital  10,473,261   10,473,261 
Accumulated deficit  (22,696,452)  (15,747,021)
Total stockholders’ deficit  (10,624,096)  (3,674,665)
Total liabilities and stockholders’ deficit $15,787,750  $16,766,392 

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 5

MADISON TECHNOLOGIES INC.

INTERIMCONDENSED CONSOLIDATED STATEMENTS of Operations

(uNAUDITED)(Unaudited)

  For the three  For the three  For the nine  For the nine 
  month ended  month ended  month ended  month ended 
  September 30  September 30  September 30  September 30 
  2017  2016  2017  2016 
             
Revenues                
Sales $1,456  $0  $6,255  $0 
Cost of sales  798   0   4,359   0 
                 
                 
Gross Margin  658   0   1,896   0 
                 
Operating expenses                
Amortization expense  6,250   0   18,750   0 
General and administrative  5,180   4,617   9,984   13,349 
                 
   11,430   4,617   33,914   13,349 
                 
Loss before other expense  (10,772)  (4,617)  (32,018)  (13,349)
                 
Other expense - interest  (5,586)  (7,583)  (22,312)  (22,608)
                 
Net loss  (16,358)  (12,200)  (54,330)  (35,957)
                 
Other Comprehensive income                
Translation gain(loss)  0   476   0   (1,714)
                 
Total comprehensive loss $(16,358) $(11,724) $(54,330) $(37,671)
                 
Net loss per share                
-Basic and diluted $(0.001) $(0.001) $(0.005) $(0.003)
                 
Average number of shares of common stock outstanding  12,216.010   11,302,000   11,575,016   11,302,000 
             
  Three Months Ended  Nine Months Ended 
  September 30, 2022  September 30, 2021  September 30, 2022  September 30, 2021 
             
Revenues $485,497  $464,028  $1,431,762  $760,053 
                 
Operating Expenses                
Selling, general and administrative  272,533   198,567   753,378   433,025 
Television operations  85,800   74,889   257,483   178,869 
Amortization of intangible assets  80,993   (57,437)  242,481   177,006 
Professional fees  416,019   741,296   2,556,767   1,745,592 
Loss on asset disposals  -   17,147   52,668   17,147 
Total operating expenses  855,345   974,462   3,862,777   2,551,639 
                 
Loss before other expense  (369,848)  (510,434)  (2,431,015)  (1,791,586)
                 
Other income (expense)                
Interest income  10,034   -   29,081   - 
Interest expense  (1,520,742)  (1,927,580)  (4,547,497)  (3,129,983)
Total non operating expense  (1,510,708)  (1,927,580)  (4,518,416)  (3,129,983)
                 
Loss from continuing operations  (1,880,556)  (2,438,014)  (6,949,431)  (4,921,569)
                 
Income (loss) from discontinued operations  -   32,722   -   (40,323)
                 
Net loss and comprehensive loss $(1,880,556) $(2,405,292) $(6,949,431) $(4,961,892)
                 
Net loss per share-Basic and diluted $(0.001) $(0.096) $(0.004) $(0.203)
                 
Average number of shares of common stock outstanding  1,599,095,027   24,972,565   1,599,095,027   24,439,598 

See Accompanying Notes to Interimthe Unaudited Condensed Consolidated Financial Statements.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 6

MADISON TECHNOLOGIES INC.

INTERIMCONDENSED CONSOLIDATED StatementS of stockholders’ DEFICIencyDEFICIT

(UNAUDITED)(Unaudited)

           Accumulated       
        Additional  Other       
  Common     Paid-in  Comprehensive  Accumulated    
  Shares  Amount  Capital  Income  Deficit  Total 
                  
Balance December 31, 2015  11,302,000  $11,302  $224,600  $3,109  $(504,761) $(265,750)
                         
Foreign currency adjustments  -   -   -   (3,109)  -   (3,109)
Convertible debt - Note 7  -   -   61,000   -   -   61,000 
Net loss, December 31, 2016  -   -   -   -   (66,089)  (66,089)
                         
Balance December 31, 2016  11,302,000   11,302   285,600   -   (570,850)  (273,948)
                         
Debt converted to shares – Note 7  955,556   955   16,787   -   -   17,742 
Net loss, September 30, 2017  -   -   -   -   (54,330)  (54,330)
                         
Balance September 30, 2017  12,257,556  $12,257  $302,387  $-  $(625,180) $(310,536)
                         
                  
           Additional       
  Common     Preferred  Paid In  Accumulated    
  Shares  Amount  Stock  Capital  Deficit  Total 
                   
Balance, December 31, 2021  1,599,095,027  $1,599,095  $1,348  $10,473,261  $(15,747,021) $(3,674,665)
Net loss for the period  -   -   -   -   (6,949,431)  (6,949,431)
                         
Balance, September 30, 2022  1,599,095,027  $1,599,095  $1,348  $10,473,261  $(22,696,452) $(10,624,096)

           Additional       
  Common     Preferred  Paid In  Accumulated    
  Shares  Amount  Stock  Capital  Deficit  Total 
                   
Balance, December 31, 2020  23,472,565  $23,472  $93  $1,302,977  $(1,484,442) $(157,900)
Beginning balance  23,472,565  $23,472  $93  $1,302,977  $(1,484,442) $(157,900)
Cancellation of Series A Preferred  -   -   (93)  93   -   - 
Common issued for Series B Preferred transfer  1,500,000   1,500   -   (1,500)  -   - 
Conversion of debt to Series D Preferred  -   -   -   667,984   -   667,984 
Series E Preferred issued for assets  -   -   -   4,225,061   -   4,225,061 
Series G Preferred issued for subscriptions sold  -   -   -   4,600,000   -   4,600,000 
Equity portion on convertible debt issued  -   -   -   880,000   -   880,000 
Net loss for the period  -   -   -   -   (4,961,892)  (4,961,892)
                         
Balance, September 30, 2021  24,972,565  $24,972  $-  $11,674,615  $(6,446,334) $5,253,253 
Ending balance  24,972,565  $24,972  $-  $11,674,615  $(6,446,334) $5,253,253 

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 7

MADISON TECHNOLOGIES INC.

INTERIM

CONDENSED CONSOLIDATED StatementS of cash flows

(UNAUDITED)

  For the nine  For the nine 
  months ended  months ended 
  September 30,  September 30, 
  2017  2016 
       
Cash Flows from operating activities:        
Net loss $(54,330) $(35,957)
Adjustments to reconcile net loss to cash used in operating activities        
Amortization of convertible debt discount recorded as interest  17,698   18,000 
Amortization of license  18,750   - 
Accrued interest on notes payable  4,614   4,608 
Foreign exchange on notes payable  2,543   - 
Changes in assets and liabilities        
Accounts payable and accruals  1,186   (10,611)
         
Net cash used in operating activities  (9,539)  (23,960)
         
Cash Flows from investing activities:        
Purchase of Intangible asset  -   (10,000)
         
Net cash used in investing activities  -   (10,000)
         
Cash Flows from financing activities:        
Proceeds of convertible notes payable  -  41,000 
         
Net cash provided by financing activities  -   41,000 
         
Net increase (decrease) in cash  (9,539)  7,040 
         
Cash, beginning of period  14,259   501 
         
Cash, end of period $4,720  $7,541 
         
SUPPLEMENTAL DISCLOSURE        
         
Interest $22,313  $22,608 
Taxes paid $-  $- 

(unaudited)

  September 30, 2022  September 30, 2021 
  For the Nine Months Ended 
  September 30, 2022  September 30, 2021 
       
Cash Flows from operating activities:        
Net loss for the period $(6,949,431) $(4,961,892)
Adjustments to reconcile net loss to cash used in operating activities:        
Amortized interest  2,000,051   372,177 
Amortization  242,481   140,826 
Fair value of Warrant issued for services  9,000   - 
Foreign exchange on notes payable  -   312 
Loss on disposal of assets  52,668   17,147 
Changes in assets and liabilities:        
Accounts payable and accruals  2,676,783   628,104 
Payment of lease liability  (167,046)  40,729 
Accounts receivable  64,264   (136,500)
Due from related party  737,917   (276,970)
Prepaid expenses  (9,056)  (6,331)
         
Net cash used in operating activities  (1,342,369)  (4,182,398)
         
Cash Flows from investing activities:        
Purchases of equipment, intangible assets and goodwill  (97,609)  (14,462,531)
Funds advanced for note receivable  (58,874)  - 
Net cash used in investing activities  (156,483)  (14,462,531)
         
Cash Flows from financing activities:        
Proceeds from convertible and subordinate notes sold $1,452,000  $16,230,000 
Shares subscribed but not issued  -   4,600,000 
Net cash provided by financing activities  1,452,000   20,830,000 
         
Net (decrease) increase in cash  (46,852)  2,185,071 
         
Cash, beginning of period  55,656   9,491 
         
Cash, end of period $8,804  $2,194,562 
         
SUPPLEMENTAL DISCLOSURE        
         
Interest paid $529,786  $1,139,292 
Taxes paid $-  $- 

See Accompanying Notes to the Unaudited Condensed Consolidated Financial Statements

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 8

MADISON TECHNOLOGIES INC.

NOTES TO THE INTERIMCONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(UNAUDITED)(Unaudited)

September 30, 20172022

Note 1Interim Reporting

While the information presented in the accompanying interim nine months consolidated financial statements is unaudited, it includes all adjustments, which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented in accordance with accounting principles generally accepted in the United States of America. These interim financial statements follow the same accounting policies and methods of their application as the Company’s December 31, 2016 annual consolidated financial statements. All adjustments are of a normal recurring nature. It is suggested that these interim financial statements be read in conjunction with the Company’s December 31, 2016 annual financial statements. Operating results for the nine months ended September 30, 2017 are not necessarily indicative of the results that can be expected for the year ended December 31, 2017.

Note 2Nature and Continuance of Operations

TheOur Company was incorporated on June 15, 1998 in the State of Nevada, USA and the Company’sour common shares are publicly traded on the OTC Bulletin Board.Markets OTCQB.

Up until fiscal 2014, the Company wasWe, through our wholly-owned subsidiary, Sovryn Holdings, Inc. (“Sovryn”) acquired three un-affiliated Class A/LPTV TV. Each licensed TV station can broadcast between 10 and 12 channels over-the-air, 24 hours per day/7 days per week. In 2021, we generated revenue by leasing channels to third parties on KNLA/KNET, a Class A television station in the business of mineral exploration. Los Angeles, KVVV, a low power television station in Houston and KYMU-LD, a low power television station in Seattle.

On May 28, 2014, the Company formalized an agreement whereby it purchased assets associated with a smokeless cannabis delivery system. The Company planned to develop this system for commercial purposes. On December 14, 2014, this asset purchase agreement was terminated.

On January 21, 2015, a majority of the Company’s stockholders approved a consolidation of the issued and outstanding shares of common stock, on a 10 for 1 basis, thereby decreasing the issued and outstanding share capital from 113,020,000 to 11,302,000. On March 11, 2015, the Company changed its name from Madison Explorations, Inc. to Madison Technologies Inc. and effected the stock consolidation. These financial statements give retroactive effect to both these changes.

On September 16, 2016, the Company entered into an exclusive distribution product license agreement with Tuffy Packs, LLC to distribute products into the United Kingdom and 43 other essentially European countries. The Company will be selling ballistic panels which are personal body armors, that conforms to the National Institute of Justice (NIJ) Level IIIA threat requirements. The Company’s plan of operations and sales strategy include online and social media marketing, as well as attending various tradeshows and conferences.

Effective December 31, 2016, the Company dissolved itsNovember 15, 2021, we sold our wholly owned subsidiary, Scout ResourcesCZJ License Inc. (“Scout”)for $250,000.

During August 2021, our shareholders approved to amend and assumed all the debt that Scout owed.restate our Articles of Incorporation to increase our authorized common stock from 500,000,000 shares to 6,000,000,000 shares.

TheseNote 2 Going Concern

The accompanying consolidated financial statements have been prepared in accordance with generally accepted accounting principles applicable toassuming we will continue as a going concern, which assumes thatcontemplates the Company will be able to meet its obligations and continue its operations for its next twelve months. Realization values may be substantially different from carrying values as shown and these financial statements do not give effect to adjustments that would be necessary to the carrying values and classificationrecoverability of assets and the satisfaction of liabilities shouldin the Company be unable to continue asnormal course of business. For the year ended December 31, 2021, we incurred a going concern. At September 30, 2017, the Companynet loss of $14,262,579 and had a working capital deficit and an accumulated deficit of $4,373,271 and $15,747,021, respectively, at December 31, 2021. We have not yet achieved profitable operations, had accumulated lossesmade the $0.4 million interest payments on the Notes held by Arena Partners LP that were due on April 1, 2022, July 1, 2022 and October 1, 2022, and we are currently in discussions with Arena Capital LP on a plan of $625,180 since its inception and expects to incur further losses in the development of its business, all of which castsforbearance. It is management’s opinion that these matters raise substantial doubt about the Company’sour ability to continue as a going concern. The Company’sconcern for a period of twelve months from the issuance date of this report. Our ability to continue as a going concern is dependent upon itsmanagement’s ability to generate future profitable operations and/obtain a plan of forbearance, further implement our business plan and raise additional capital as needed from the sales of stock or debt. The accompanying consolidated financial statements do not include any adjustments that might be required should we be unable to obtain the necessary financing to meet its obligations and repay its liabilities arising from normal business operations when they come due. Management has no formal plan in place to address this concern but considers that the Company will be able to obtain additional funds by equity financing and/or related party advances. That said, there is no assurance of additional funding being available.continue as a going concern.

Form 10-Q – Q3Madison Technologies Inc.Page 9

Note 3Summary of Significant Accounting Policies

ThereUse of estimates

The preparation of the consolidated interim financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses during the reporting period. Management makes its best estimate of the ultimate outcome for these items based on historical trends and other information available when the financial statements are prepared. Changes in estimates are recognized in accordance with the accounting rules for the estimate, which is typically in the period when new information becomes available to management. Actual results could differ from those estimates.

Form 10-Q – Q2Madison Technologies Inc.Page 9

Consolidation

The accompanying consolidated financial statements include the accounts of our wholly owned subsidiaries, Sovryn Holdings Inc. and CZJ License Inc. CZJ License Inc. was consolidated up until it was sold on November 15, 2021. All the intercompany balances and transactions have been no changeseliminated in the consolidation. During the year ended December 31, 2021, the operations of CZJ License Inc. were consolidated into our operation and were designated as discontinued.

Interim Reporting

While the information presented in the accompanying interim three month financial statements is unaudited, it includes all adjustments, which are, in the opinion of management, necessary to present fairly the financial position, results of operations and cash flows for the interim periods presented in accordance with accounting principles generally accepted in the United States of America. These interim financial statements follow the same accounting policies from those disclosedand methods of their application as the Company’s December 31, 2021 annual financial statements. All adjustments are of a normal recurring nature. It is suggested that these interim financial statements be read in conjunction with the notes toCompany’s December 31, 2021 annual financial statements. Operating results for the audited consolidated financial statementsthree and nine months ended September 30, 2022 are not necessarily indicative of the results that can be expected for the year ended December 31, 2016.2022.

Segment reporting

We use “the management approach” in determining reportable operating segments. The management approach considers the internal organization and reporting used by our chief operating decision maker for making operating decisions and assessing performance as the source for determining our reportable segments. Our chief operating decision maker is our chief executive officer, who reviews operating results to make decisions about allocating resources and assessing our entire performance. We did not report any segment information since we primarily generates sales from its television stations.

Reclassifications

Certain prior year amounts have been reclassified to conform to the current year presentation.

Revenue recognition

We adopted the ASC Topic 606, Revenue from Contracts with Customers (“ASC 606”). We recognize revenue when we transfer promised services to the customer. The performance obligation is the monthly services rendered. We have one main revenue source which is leasing of television station channels. Accordingly, we recognize revenue when services are provided as time passes the customers have access to utilize the channel. These revenues are billed in advance, arrears and/or are prepaid. The performance obligation is the monthly services rendered. At the moment, we have one main revenue source which is leasing of television channels. Where there is a leasing contract for channels, we bill monthly for our services as rendered. Where there is no contract, the revenue is recognized as provided.

We recognize revenue in accordance with ASC 606 using the following 5 steps to identify revenues:

identify the contract with a customer;
identify the performance obligations in the contract;
determine the transaction price;
allocate the transaction price to performance obligations in the contract; and
recognize revenue as the performance obligation is satisfied.

Form 10-Q – Q2Madison Technologies Inc.Page 10

Advances from Client’s deposits are contract liabilities with customers that represent our obligation to either transfer goods or services in the future, or refund the amount received. Where possible, we obtain retainers to lessen our risk of non-payment by our customers. Advances from Client’s deposits are recognized as revenue as we meet specified performance obligations as detailed in the contract.

Accounts receivables

Trade accounts receivable are stated at the amount we expect to collect. Management considers the following factors when determining the collectability of specific customer accounts: customer credit worthiness, past transaction history, current economic industry trends and changes in customer payment terms. Past due balances over 90 days and other higher risk amounts are reviewed individually for collectability. Based on the management’s assessment, we provide for estimated uncollectible amounts through a charge to earnings and a credit to a valuation allowance. Balances that remain outstanding after we have used reasonable collection efforts are written off through a charge to the valuation allowance and a credit to accounts receivable. As of September 30, 2022, our allowance for doubtful accounts receivable was $31,500.

Operating leases

In February 2016, the FASB issued ASU 2016-02, Leases (“Topic 842”). The new standard establishes a right-of-use model that requires a lessee to record a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. For leases with an initial term of 12 months or less, a lessee is permitted to make an accounting policy election by class of underlying asset not to recognize lease assets and lease liabilities. If a lessee makes this election, it should recognize lease expense for such leases generally on a straight-line basis over the term of the lease. Leases will be classified as either finance or operating, with classification affecting the pattern of expense recognition. Similarly, lessors will be required to classify leases as sales-type, finance or operating, with classification affecting the pattern of income recognition. Classification for both lessees and lessors will be based on an assessment of whether risks and rewards as well as substantive control have been transferred through a lease contract. The new standard is effective for fiscal years beginning after December 15, 2018, including interim periods within those fiscal years, with early adoption permitted. We adopted the new standard April 19, 2021. We have elected not to recognize lease assets and lease liabilities for leases with an initial term of 12 months or less.

Intangible assets

Intangible assets are non-monetary identifiable assets, controlled by us that will produce future economic benefits, based on reasonable and supportable assumptions about conditions that will exist over the life of the asset. An intangible asset that does not meet these attributes will be recognized as an expense when it is incurred. Intangible assets that do, are capitalized and initially measured at cost. Those with a determinable life will be amortized on a systematic basis over their future economic life. Those with an indefinite useful life shall not be amortized until its useful life is determined to be longer indefinite. An intangible asset subject to amortization shall be periodically reviewed for impairment. A recoverability test will be performed and, if applicable, unscheduled amortization is considered.

License agreements have been capitalized, recorded at cost and amortized over the life of the contracts. They will be amortized over the life of the license to which it supports.

Equipment

Equipment represents purchases made for assets, whose useful life was determined to be greater than one year. The assets are initially recorded at cost and depreciated over their estimated useful lives.

Form 10-Q – Q2Madison Technologies Inc.Page 11

Website development costs

We recognized the costs associated with developing a website in accordance with ASC 350-50 “Website Development Cost”. The website development costs are divided into three stages, planning, development and production. The development stage can further be classified as application and infrastructure development, graphics development and content development. In short, website development cost for internal use should be capitalized except content input and data conversion costs in content development stage.

Costs associated with the website consist primarily of website development costs paid to third party. These capitalized costs will be amortized based on their estimated useful life over three years upon the website becoming operational. Internal costs related to the development of website content will be charged to operations as incurred. Website development costs related to the customers are charged to cost of sales.

Impairment of Long-Lived Assets

In accordance with the provisions of ASC Topic 360, “Impairment or Disposal of Long-Lived Assets, all long-lived assets such as plant and equipment and intangible assets we hold and use are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. Recoverability of assets to be held and used is evaluated by a comparison of the carrying amount of an asset to its estimated future undiscounted cash flows expected to be generated by the asset. If such assets are considered to be impaired, the impairment to be recognized is measured by the amount by which the carrying amounts of the assets exceed the fair value of the assets.

Concentration of credit risk

We place our cash and cash equivalents with a high credit quality financial institution. We maintain United States Dollars. We minimize its credit risks associated with cash by periodically evaluating the credit quality of its primary financial institution.

Financial instruments

Our financial instruments consist principally of cash, accounts payable, accrued liabilities and notes payable. The carrying amounts of such financial instruments in the accompanying financial statements approximate their fair values due to their relatively short-term nature or the underlying terms are consistent with market terms. It is the management’s opinion that we are not exposed to any significant currency or credit risks arising from these financial instruments.

Fair value measurements

We follow the guidelines in ASC Topic 820 “Fair Value Measurements and Disclosures”. Fair value is defined as the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining the fair value measurements for assets and liabilities, which are required to be recorded at fair value, we consider the principal or most advantageous market in which we would transact and the market-based risk measurements or assumptions that market participants would use in pricing the asset or liability, such as inherent risk, transfer restrictions and credit risk.

Form 10-Q – Q2Madison Technologies Inc.Page 12

We apply the following fair value hierarchy, which prioritizes the inputs used to measure fair value into three levels and bases the categorization within the hierarchy upon the lowest level of input that is available and significant to the fair value measurement. All financial instruments approximate their fair value.

Level 1 — Observable inputs that reflect unadjusted quoted prices for identical assets or liabilities traded in active markets.
Level 2 — Observable inputs other than quoted prices in active markets for identical assets and liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities
Level 3—inputs are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability. The fair values are therefore determined using model-based techniques, including option pricing models and discounted cash flow models.

Convertible Notes with Fixed Rate Conversion Options

We may enter into convertible notes, some of which contain, predominantly, fixed rate conversion features, whereby the outstanding principal and accrued interest may be converted by the holder, into common shares at a fixed discount to the market price of the common stock at the time of conversion. This results in a fair value of the convertible note being equal to a fixed monetary amount. We record the convertible note liability at its fixed monetary amount by measuring and recording a premium, as applicable, on the Note 4Recentdate with a charge to interest expense in accordance with ASC 480 - “Distinguishing Liabilities from Equity”.

Derivative Liabilities

We have certain financial instruments that are derivatives or contain embedded derivatives. We evaluate all our financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with ASC 810-10-05-4 and 815-40. This accounting treatment requires that the carrying amount of any derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with us, the change in the fair value during the period is recorded as either other income or expense. Upon conversion, exercise or repayment, the respective derivative liability is marked to fair value at the conversion, repayment or exercise date and then the related fair value amount is reclassified to other income or expense as part of gain or loss on extinguishment.

Loss per share

Net Loss Per Share

Basic loss per share is calculated by dividing the loss attributable to stockholders by the weighted-average number of shares outstanding for the period. Diluted loss per share reflects the potential dilution that could occur if securities or other contracts to issue common stock were exercised or converted into common stock or resulted in the issuance of common stock that shared in our earnings (loss). Diluted loss per share is computed by dividing the loss available to stockholders by the weighted average number of shares outstanding for the period and dilutive potential shares outstanding unless such dilutive potential shares would result in anti-dilution. As of September 30, 2022, no options were outstanding and 231,173,016 warrants were outstanding and exercisable. Additionally, as of September 30, 2022, the outstanding principal balance, including accrued interest of the third-party convertible debt, totaled $19,874,163 and was convertible into 1,014,123,286 shares of Common Stock. We issued shares of Preferred Stock that may be converted into our Common Stock. Of the outstanding shares of Preferred Stock as of September 30, 2022, Series D Preferred Stock was convertible into 155,000,000 Common shares, Series E-1 Preferred Stock was convertible into 1,152,500,000 Common shares and Series H Preferred Stock was convertible into 39,895,000 Common shares. The total potentially dilutive shares calculated are 2,592,691,302. It should be noted that contractually the limitations on the third-party notes (and the related warrants) limit the number of shares converted to either 4.99% or 9.99% of the then outstanding shares. As of September 30, 2022, and 2021, potentially dilutive securities consisted of the following:

Schedule of Potentially Dilutive Securities

  September 30, 2022  September 30, 2021 
Warrants  231,173,016   192,073,017 
Convertible Preferred Stock  1,347,395,000   1,574,573,017 
Convertible debt  1,014,123,286   835,839,600 
Total  2,592,691,302   2,602,584,634 

Form 10-Q – Q2Madison Technologies Inc.Page 13

Business Combinations

In accordance with ASC 805-10, “Business Combinations”, we account for all business combinations using the acquisition method of accounting. Under this method, assets and liabilities, including any remaining non-controlling interests, are recognized at fair value at the date of acquisition. The excess of the purchase price over the fair value of assets acquired, net of liabilities assumed, and non-controlling interests is recognized as goodwill. Certain adjustments to the assessed fair values of the assets, liabilities, or non-controlling interests made subsequent to the acquisition date, but within the measurement period, which is up to one year, are recorded as adjustments to goodwill. Any adjustments subsequent to the measurement period are recorded in income. Any cost or equity method interest that we hold in the acquired company prior to the acquisition is re-measured to fair value at acquisition with a resulting gain or loss recognized in income for the difference between fair value and the existing book value. Results of operations of the acquired entity are included in our results from the date of the acquisition onward and include amortization expense arising from acquired tangible and intangible assets.

Credit losses

In June 2016, the FASB issued ASU 326, “Financial Instruments – Credit Losses”. The ASU sets forth a “current expected credit loss” (CECL) model which requires us to measure all expected credit losses for financial instruments held at the reporting date based on historical experience, current conditions, and reasonable supportable forecasts. This replaces the existing incurred loss model and is applicable to the measurement of credit losses on financial assets measured at amortized cost and applies to some off-balance sheet credit exposures. This ASU is effective for fiscal years beginning after December 15, 2019, including interim periods within those fiscal years, with early adoption permitted. Recently, the FASB issued the final ASU to delay adoption for smaller reporting companies to calendar year 2023. We are currently assessing the impact of the adoption of this ASU on its financial statements.

Related Party Transactions

We follow FASB ASC subtopic 850-10, “Related Party Transactions”, for the identification of related parties and disclosure of related party transactions.

Pursuant to ASC 850-10-20, related parties include: a) our affiliates; b) entities for which investments in their equity securities would be required, absent the election of the fair value option under the Fair Value Option Subsection of Section 825–10–15, to be accounted for by the equity method by the investing entity; c) trusts for the benefit of employees, such as pension and profit sharing trusts that are managed by or under the trusteeship of management; d) our principal owners; e) our management; f) other parties with which we may deal if one party controls or can significantly influence the management or operating policies of the other to an extent that one of the transacting parties might be prevented from fully pursuing its own separate interests; and g) other parties that can significantly influence the management or operating policies of the transacting parties or that have an ownership interest in one of the transacting parties and can significantly influence the other to an extent that one or more of the transacting parties might be prevented from fully pursuing its own separate interests.

Material related party transactions are required to be disclosed in the consolidated financial statements, other than compensation arrangements, expense allowances, and other similar items in the ordinary course of business. However, disclosure of transactions that are eliminated in the preparation of consolidated or combined financial statements is not required in those statements. The disclosures shall include: a) the nature of the relationship(s) involved; b) a description of the transactions, including transactions to which no amounts or nominal amounts were ascribed, for each of the periods for which statements of operation are presented, and such other information deemed necessary to an understanding of the effects of the transactions on the financial statements; c) the dollar amounts of transactions for each of the periods for which statements of operations are presented and the effects of any change in the method of establishing the terms from that used in the preceding period; and d) amounts due from or to related parties as of the date of each balance sheet presented and, if not otherwise apparent, the terms and manner of settlement.

Form 10-Q – Q2Madison Technologies Inc.Page 14

Discontinued operations

Discontinued operations are components of an entity that either have been disposed or abandoned or is classified as held for sale. Additionally, in order to qualify as a discontinued operation, the disposal or abandonment must represent a strategic shift that has or will have a major effect on an entity’s operations and financial results.

Income taxes

We follow the guideline under ASC Topic 740 Income Taxes. “Accounting for Income Taxes” which requires the recognition of deferred tax assets and liabilities for the expected future tax consequences of events that have been included in the financial statements or tax returns. Under this method, deferred income taxes are recognized for the tax consequences in future years of differences between the tax bases of assets and liabilities and their financial reporting amounts at each period end based on enacted tax laws and statutory tax rates, applicable to the periods in which the differences are expected to affect taxable income. Valuation allowances are established, when necessary, to reduce deferred tax assets to the amount expected to be realized. Due to the uncertainty regarding our future profitability, the future tax benefits of its losses have been fully reserved.

Recently Issued Accounting Pronouncements

The Company adoptsWe adopt new pronouncements relating to generally accepted accounting principles applicable to the Companyus as they are issued, which may be in advance of their effective date. Management does

In May 2021, the FASB issued ASU 2021-04, Earnings Per Share (Topic 260), Debt-Modifications and Extinguishments (Subtopic 470-50), Compensation-Stock Compensation (Topic 718), and Derivatives and Hedging-Contracts in Entity’s Own Equity (Subtopic 815-40). The new ASU addresses issuer’s accounting for certain modifications or exchanges of freestanding equity-classified written call options. This amendment is effective for all entities, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. Early adoption is permitted. We are currently evaluating the impact this new guidance will have on its financial statements

We do not believe that any pronouncementother recently issued but not yet effective but recently issued would,accounting pronouncements, if adopted, would have a material effect on the accompanying consolidated financial statements.

Note 5License Agreement4 Notes Receivable

Schedule of Notes Receivable

  September 30, 2022  December 31, 2021 
Secured note – Top Dog Productions Inc. $527,624  $468,750 
Convertible note – ZA Group  250,000   250,000 
Prepaid expenses  9,288   24,042 
Accrued interest  30,622   6,811 
Total Notes Receivables $817,534  $749,603 

The CompanyOn September 9, 2021, we entered into a secured one-year promissory note with Top Dog Productions Inc. We agreed to lend an exclusive product license agreement on September 16, 2016 with Tuffy Packs, LLC,aggregate principal sum of up to $2,000,000 that accrues at a Texas corporation, to sell Ballistic Panels in certain countries, essentially in Europe.rate of 5% per annum. The license is for a periodprincipal and interest amount of two years unless terminated andthe note may be renewed for successive termsprepaid in whole or in part at any time, without penalty nor premium. Accrued interest is $19,626 at September 30, 2022. We are seeking to close the acquisition of two years each. The payment termsTop Dog Productions Inc. in 2022 and extend the note’s maturity by approximately one year.

On November 15, 2021, we entered into a $250,000 convertible promissory note with ZA Group Inc. for the license is as follows:

1.$10,000 payable within seven days after the effective date;
2.An additional $15,000 payable within 30 days after the effective date; and
3.A final payment of $25,000 payable within 90 days of the effective date.

At September 30, 2017, the Company had paid $16,500 to the Licensor, leaving an unpaid balancesale of $33,500. To date, the Company has recordedits wholly owned subsidiary, CZJ License Inc. The note accrues at a total license amortizationrate of $25,990.

As a result5% per annum. The principal and accrued interest of the failure to make payments as required under the agreement, the Company was informed on March 20, 2017, that going forward, the agreement wouldnote receivable will be on a non-exclusive basis.

Note 6Notes and Accrued Interest Payable

The Company has two notes payable to Paleface Holdings Inc. Each note is unsecureddue and payable on demand.

a)$25,000 note with annual interest payable at 8%.
As at September 30, 2017, accrued interest on the note was $25,297 (September 30, 2016 - $23,297). The note payable balance including accrued interest was $50,297 as at September 30, 2017 (September 30, 2016 - $48,297). Interest on the debt for eachNovember 5, 2023. At any time after 180 days following the date of the nine months ended September 30 was $1,500.
b)$24,000 ($30,000 CDN) with annual interest payable at 5%
As at September 30, 2017, accrued interest on the note was $12,600 (September 30, 2016 - $10,841). The note payable balance including accrued interest was $36,600 as at September 30, 2017 (September 30, 2016 - $33,666). Interest on debt for the nine months ended September 30 was $900 in 2017 and $864 in 2016.

The company also has an unsecured note payable on demand to Gens Incognitoreceivable, we may convert all or any part of the outstanding and unpaid amount of the note into fully paid and non-assessable shares of common stock of ZA Group Inc. for $25,000, bearingat a fixed conversion price of $0.005 per share. Accrued interest at 12%. Asis $10,586 at September 30, 2017, accrued interest on the note was $9,942 (September 30, 2016 - $6,950). The note payable balance including accrued interest was $34,942 as at September 30, 2017 (September 30, 2016 - $31,950).2022.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 1015

Note 7Related Party Advance5 - Intangible Assets

In 2008,Our Federal Communication Commission Licenses (“FCC”) and domain name are considered indefinite-lived intangible assets that are not amortized, but instead are tested at least annually for impairment. The Market Advantage intangible asset is being amortized on a straight-line basis over 94 months from the former President advancedacquisition date. Amortization expense for the Company $561 repayable without interest or any other terms. The unpaid balance as at June 30, 2017 is $261. There were no related party transactions during the nine month periodthree months ended September 30, 2017 or 2016.2022 and 2021 was $1,878 and $1,878, respectively and $5,634 and $2,504 for the nine months ended September 30, 2022 and 2021.

Schedule of Intangible Assets

  September 30, 2022 
  Cost  Amortization  Net 
Domain Name $172,427  $-  $172,427 
Market Advantage  58,843   10,016   48,827 
FCC Licenses  10,159,063   -   10,159,063 
             
  $10,390,333  $10,016  $10,380,317 

Future amortization expense of the intangible assets is as follows:

Schedule of Future Amortization Expenses of Intangible Assets

     

For the Twelve Months Ending

September 30,

   
2023 $7,512 
2024  7,512 
2025  7,512 
2026  7,512 
2027  7,512 
Thereafter  11,267 
Total $48,827 

Note 8Common Stock6 Goodwill

On July 14, 2017, two convertible notes were converted into shares. One noteAs of September 31, 2022, we carry goodwill for $25,000the following television station asset purchases made in 2021:

Schedule of Goodwill Asset Purchase

     
KNLA - KNET acquisition $977,059 
KVVV acquisition  613,097 
KYMU acquisition  225,966 
     
Total $1,816,122 

Note 7 Equipment

Schedule of Equipment

  

Useful

Life

 Cost  Accumulated Depreciation  Net 
Transmitter 10 years $854,059  $(115,420) $738,638 
Antenna 10 years  283,029   (37,936)  245,093 
Tech Equipment 5 years  446,155   (106,591)  339,564 
Office Equipment 5 years  7,389   (1,970)  5,419 
Microwave 5 years  22,065   (6,436)  15,629 
               
    $1,612,697  $(268,353) $1,344,344 

Depreciation expense was converted into 555,556 shares at $0.045 per share$52,339 and ($78,440) for the other was converted to 400,000 shares at $0.05 per shares. Thethree months ended September 30, 2022 and 2021, respectively, and $156,517 and $66,065 for the nine months ended September 30, 2022 and 2021, respectively. During the three months ended September 30, 2021, we received an independent third party valuation of the equipment we acquired as part of the television asset purchases and we reduced the carrying value of the notesacquired equipment and related depreciation in that three-month period.

Form 10-Q – Q2Madison Technologies Inc.Page 16

Note 8 Right of Use Assets

We have six operating leases ranging from a period of 80 months to a period of 332 months. The annual interest rate used was $17,742.15%. As at September 30, 2022, the remaining right of use assets are as follows:

Schedule of Remaining Right of Use Assets

  Term     Accumulated    
  (in months)  Amount  Amortization  Net 
Tower Lease 1  168.5  $547,663  $54,923  $492,740 
Tower lease - 2  88   244,079   41,545   202,534 
Tower lease - 3  329   233,043   8,348   224,695 
Generator lease  168.5   109,507   10,982   98,525 
Studio lease - 1  214.5   280,084   20,324   259,670 
Studio lease - 2  77   49,561   7,165   42,396 
                 
      $1,463,937  $143,287  $1,320,650 

On January 21, 2015, a majorityThe remaining lease liability at September 30, 2022 was $1,466,584. The current portion of the Company’s stockholders approved a consolidationlease liability was $0 and the non-current portion of the issuedlease liability was $1,466,584.

Schedule of Remaining Lease Liability

     
2022 $56,833 
2023  231,120 
2024  239,780 
2025  253,163 
2026  261,433 
Remaining  3,219,115 
Lease obligations, net  4,261,445 
Amount representing interest  2,794,861 
Remaining lease liability  1,466,584 
Less current portion  - 
Non-current lease obligation $1,466,584 

Note 9 Accounts Payable and outstanding sharesAccrued Liabilities

Accounts payable and accrued liabilities as of common stock, onDecember 31 are summarized below:

Schedule of Accounts Payable and Accrued Liabilities

  September 30, 2022  December 31. 2021 
Accounts payable $1,151,618  $659,219 
Customer deposits  62,563   78,812 
Accrued expenses  61,698   38,238 
Accrued interest  171,457   15,533 
         
Total $1,447,336  $791,802 

On June 10, 2022, we entered into an agreement with a third party pursuant to which we received $125,000 in cash that we repay daily at $1,837 per diem until we have paid $183,750 in total. As of September 30, 2022, included in accounts payable is the $45,938 remaining balance owed and included in accrued expenses is $14,688 financing fee that is being amortized over the term of the agreement.

On July 28, 2022, we entered into an agreement with a third party pursuant to which we received $125,000 in cash that we repay daily at $1,562 per diem until we have paid $187,375 in total. As of September 30, 2022, included in accounts payable is the $118,647 remaining balance owed and included in accrued expenses is $39,504 financing fee that is being amortized over the term of the agreement.

On September 13, 2022, we entered into an agreement with a third party pursuant to which we received $25,000 in cash that we repay daily at $1,499 per diem until we have paid $44,970 in total. As of September 30, 2022, included in accounts payable is the $25,483 remaining balance owed and included in accrued expenses is $8,483 financing fee that is being amortized over the term of the agreement.

Form 10-Q – Q2Madison Technologies Inc.Page 17

Note 10 for 1 basis, thereby decreasing the issued and outstanding share capital from 113,020,000 to 11,302,000. This was effected on March 11, 2015. This consolidation has been applied retroactively and all references to the number of shares issued reflect this consolidation.Securities Exchange Agreements

On March 30, 2006, the CompanySovryn Holdings, Inc.

We entered into a private placement agreement wherebySecurities Exchange Agreement on February 16, 2021 with Sovryn, a Delaware corporation and acquired 100% of the Company issued 20,000 Regulation-S shares of Sovryn in exchange for $50,000. ($2.50i) 100 shares of our Series B Preferred Stock to be transferred by Jeffrey Canouse, our CEO at the time, to a designee of Sovryn and ii) 1,000 shares of Series E Preferred Stock. Upon the effectiveness of an amendment to out Articles of Incorporation to increase our authorized common stock, from par value $0.001 to par value $0.0001 per share).share, from 500,000,000 shares to 6,000,000,000 shares, all shares of Series E Preferred Stock issued to the shareholders shall automatically convert into approximately 2,305,000,000 shares of our Common Stock. The Series E Preferred Stock votes on an as-converted basis with our Common Stock prior to their conversion. The Series E Preferred Stock represented approximately 59% of the fully diluted shares of our Common Stock after the closing of the transactions contemplated by the Securities Purchase Agreement. The valuation for the Preferred Series E shares was determined to be $4,225,062 based on the market value of our shares we exchanged at the date the transaction. The transaction was recorded as an asset purchase and we recorded goodwill of $4,224,962 which was based on the market value of our shares exchanged at the date of the transaction.

Note 11 Asset Purchase

On April 19, 2021, pursuant to a February 17, 2021 asset purchase agreement, Sovryn paid a total of $10,182,534 to acquire the licenses and Federal Communications Commission (“FCC”) authorizations to the KNET-CD and KNLA-CD Class A television stations (“the Los Angeles Stations”), certain tangible personal property, real property, contracts, intangible property, files, claims and prepaid items together with certain assumed liabilities in connection with the Los Angeles Stations.

The following table shows the estimated fair values of the Los Angeles Stations’ assets acquired and liabilities assumed at the April 19, 2021 purchase date:

Schedule of Asset Acquisitions

     
ASSETS ACQUIRED    
Transmitter equipment $576,944 
Technical equipment  183,841 
Antenna systems  128,562 
Microwave equipment  22,065 
Total tangible assets acquired  911,412 
Total liabilities assumed  - 
NET TANGIBLE ASSETS ACQUIRED $911,412 
     
INTANGIBLE ASSETS ACQUIRED    
FCC licenses  8,294,063 
Transmitter site leasehold    
Goodwill  977,059 
INTANGIBLE ASSETS ACQUIRED  9,271,122 
     
NET ASSETS ACQUIRED $10,182,534 

On June 7, 2004,1, 2021, pursuant to a March 14, 2021 an asset purchase agreement, Sovryn paid a total of $1,500,000 to acquire the Companylicenses and Federal Communications Commission (“FCC”) authorizations to the KVVV-LD low power television station (“the Houston Station”), certain tangible personal property, certain real property leases, contracts, intangible property, files, claims and prepaid items together with certain assumed liabilities in connection with the Houston Station.

Form 10-Q – Q2Madison Technologies Inc.Page 18

The following table shows the estimated fair values of the Houston Station’s assets acquired and liabilities assumed at the June 1, 2021 purchase date:

     
ASSETS ACQUIRED    
Transmitter equipment $107,141 
Technical equipment  71,399 
Antenna systems  112,211 
Furniture and equipment  7,389 
Total tangible assets acquired  298,140 
Total liabilities assumed  - 
NET TANGIBLE ASSETS ACQUIRED $298,140 
INTANGIBLE ASSETS ACQUIRED    
FCC licenses  530,000 
Transmitter site leasehold  58,763 
Goodwill  613,097 
INTANGIBLE ASSETS ACQUIRED  1,201,860 
     
NET ASSETS ACQUIRED $1,500,000 

On September 24, 2021, pursuant to a March 29, 2021 an asset purchase agreement, Sovryn paid a total of $1,864,920 to acquire the licenses and Federal Communications Commission (“FCC”) authorizations to the KYMU-LD low power television station (“the Seattle Station”), certain tangible personal property, certain real property leases, contracts, intangible property, files, claims and prepaid items together with certain assumed liabilities in connection with the Seattle Station.

The following table shows the estimated fair values of the Seattle Station’s assets acquired and liabilities assumed at the September 24, 2021 purchase date:

     
ASSETS ACQUIRED    
Transmitter equipment $169,974 
Technical equipment  91,274 
Antenna systems  42,256 
Microwave equipment  - 
Total tangible assets acquired  303,954 
Total liabilities assumed  - 
NET TANGIBLE ASSETS ACQUIRED $303,954 
Goodwill    
INTANGIBLE ASSETS ACQUIRED    
FCC licenses  1,335,000 
Goodwill  225,966 
INTANGIBLE ASSETS ACQUIRED  1,560,966 
     
NET ASSETS ACQUIRED $1,864,920 

Form 10-Q – Q2Madison Technologies Inc.Page 19

Note 12 Note Payable

On December 28, 2021, we sold a $500,000 promissory note that bears interest at 12% per annum and matures on April 5, 2022, as amended. In connection with the note sale, we issued 5,907,000500,000 Warrants that expire on December 31, 2023 and may be converted in consideration of $472 in cash. ($.00008 per share.)

On June 14, 2001, the Company approved a forward stock split of 5,000:1. These financial statements have been retroactively adjusted to effect this split.

On June 15, 1998, the Company authorized and issued 5,375,000 shares of its common stock in considerationour Common Stock starting June 26, 2022 at a price of $430 in cash. ($.00008$0.025 per share.)

There are no shares subject We estimate the value the Warrant to warrants or optionsbe approximately $9,000, based on a value of $0.018 per share of our Common Stock as of December 28, 2021.The promissory note is subordinate to the Notes we issued to the Investors. As of September 30, 2017.2022, $500,000 in note principal is outstanding.

On January 14, 2022, we sold an unsecured $150,000 note payable with $15,000 in fees payable upon the April 5, 2022 maturity that we treated as deferred financing fees and amortize over the term of the note. The obligation is subordinate to the Notes we issued to the Investors. As of September 30, 2022, $120,000 in note principal is outstanding.

On January 14, 2022, we sold an unsecured $150,000 note payable with $15,000 in fees payable upon the April 5, 2022 maturity that we treated as deferred financing fees and amortized over the term of the note. The obligation is subordinate to the Notes we issued to the Investors. As of September 30, 2022, $135,000 in note principal is outstanding.

On April 27, 2022, we sold a $125,000 unsecured note payable that has a $12,500 original issue discount and matures on December 31, 2022. In connection with the note sale, we issued the noteholder a Warrant to purchase a total of 2,500,000 shares of our Common Stock at $0.025 per share, on a cashless exercise basis, that is exercisable starting September 15, 2022 and until April 15, 2024. We estimate the total value of the Warrants to be $45,000, based on a $0.018 price per share of our Common Stock that we treat as a debt discount and amortize over the term of the note. As of September 30, 2022, $125,000 in note principal is outstanding.

Note 913 Convertible Notes Payable

In total, there are nineOur convertible notes payable remaining. Twoare as follows as of:

Schedule of the convertible notes payable were settled during the period ended September 30, 2017. All notes are non-interest bearing, unsecured and payable on demand. The notes are convertible into common stock at the discretion of the holder at six different conversion rates: $0.01 debt to 1 common share, $0.045 to 1 common share; $0.005 to 1 common share; $0.15 to 1 common share; $0.05 to 1 common share; and $0.04 to 1 common share. The effect that conversion would have on earnings per share has not been disclosed due to the anti-dilutive effect.Convertible Notes Payable

    September 30, 2022  December 31, 2021 
         
Senior Secured [a] $16,500,000  $16,500,000 
           
Series 1 [b]  1,050,000   850,000 
           
Series 2 [c]  250,000   - 
           
Series 3 [d]  275,000   - 
           
Series 4 [e]  220,000   - 
           
Series 5 [f]  192,500   - 
           
Series 6 [g]  55,000   - 
Total    18,542,500   17,350,000 
Less current portion    2,042,500   850,000 
           
Long term portion   $16,500,000  $16,500,000 

[a]On February 17, 2021, we entered into a securities purchase agreement with funds affiliated with Arena Investors LP (the “Investors”) pursuant to which it issued two convertible notes having an aggregate principal amount of $16,500,000 for an aggregate purchase price of $15,000,000 (collectively, the “Notes”). In connection with the issuance of the Notes, we issued to the Investors Warrants to purchase an aggregate of 192,073,017 shares of our Common Stock (collectively, the “Warrants”) and 1,000 shares of Series F Preferred Stock that convert into 192,073,017 shares of our Common Stock (the “Series F Preferred Stock”). The Warrants and Series F Preferred Stock were each valued at $864,000 based on a $0.0045 price per share of our Common Stock and treated as a debt discount this is amortized over the term of the Notes.

There are four convertible notes payable convertible on the basis of $0.01 of debt to 1 common share.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 1120

The balanceNotes have a term of thirty-six months and mature on February 17, 2024, unless earlier converted. The Notes accrue interest at a rate of 11% per annum, subject to increase to 20% per annum upon default. Interest is payable in cash on a quarterly basis beginning on March 31, 2021. Notwithstanding the above, at our election, any interest payable on an applicable payment date may be paid in registered shares of our Common Stock in an amount equal (A) the amount of the first convertible note payable convertibleinterest payment due on such date, divided by (B) an amount equal to 80% of the average volume-weighted average price of our Common Stock for the five (5) days immediately preceding the date of conversion. At September 30, 2022 and December 31, 2021 accrued and unpaid interest was $2,475,000 and $453,750, respectively. We have not yet made the $453,750 million interest payments on the basisNotes held by Arena Partners LP that were due on April 1, 2022, July 1, 2022 and October 1, 2022, and we are currently in discussions with Arena Capital LP on a plan of $0.01forbearance.

On September 24, 2021, the Company and the Investors amended the Notes and related closing documents, by executing the Limited Waiver and First Amendment the closing documents (“the amendment”). The amendment also waived specified events of debtdefault. The Notes are henceforth convertible at any time, at the holder’s option, into shares of our Common Stock at a price of $0.02 per share, subject to 1 common share isdefault event adjustment. Notwithstanding the foregoing, at any time during the continuance of any Event of Default, the Conversion price in effect shall be equal to the alternate conversion price. If at any time the conversion price as follows:

  Sep 30,  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $40,000  $40,000 
Value allocated to additional paid-in capital  40,000   40,000 
         
Balance allocated to convertible note payable  -   - 
Amortized discount  40,000   40,000 
Balance, convertible note payable $40,000  $40,000 

The total discount of $40,000 was amortized over 5 years (20%) starting April 2008 and was fully amortized as at April 2013.

The balancedetermined hereunder for any conversion would be less than the par value of the second convertible note payable convertible onCommon Stock, then at the basis of $0.01 of debt to 1 common share is as follows:

  Sep 30,  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $20,000  $20,000 
Value allocated to additional paid-in capital  20,000   20,000 
         
Balance allocated to convertible note payable  -   - 
Amortized discount  20,000   20,000 
Balance, convertible note payable $20,000  $20,000 

The total discount of $20,000 was amortized over 5 years (20%) starting June 2010 and was fully amortized as at June 2015.

The balancesole discretion of the third convertible note payable convertibleHolder, the conversion price hereunder may equal such par value for such conversion and the conversion amount for such conversion may be increased to include Additional Principal, where Additional Principal means such additional amount to be added to the principal amount of this Note to the extent necessary to cause the number of conversion shares issuable upon such conversion to equal the same number of conversion shares as would have been issued had the conversion price not been adjusted by the Holder to the par value price, subject to certain beneficial ownership limitations (with a maximum ownership limit of 9.99%). The conversion price is also subject to adjustment due to certain events, including stock dividends, stock splits and in connection with our issuance of our Common Stock or common stock equivalents at an effective price per share lower than the conversion price then in effect. We may not redeem the Notes.

As part of the agreement with the Investors, we issued 192,073,017 Warrants. On September 24, 2021, we and the Investor amended the warrant agreement such that each Warrant is exercisable for a period of five (5) years from the date of issuance at an initial exercise price equal to $0.025 per share, that is adjusted to $0.020 per share when interest is paid late, subject to certain beneficial ownership limitations (with a maximum ownership limit of 9.99%). The exercise price is also subject to adjustment due to certain events, including stock dividends, stock splits and recapitalizations. The Holder may be eligible for cashless exercise.

The Series F Preferred Stock has no voting rights and shall convert into 4.9% of our issued and outstanding shares of our Common Stock on a fully diluted basis upon Common Shareholder Approval. The Series F Preferred Stock was converted and 192,073,017 common shares were issued on October 11, 2021.

The Investors have contractually agreed to restrict their ability to exercise the basisWarrants and convert the Notes such that the number of $0.01shares of debt to 1 common share is as follows:our Common Stock held by the Investors and their affiliates after such conversion or exercise does not exceed 9.99% of our then issued and outstanding shares of Common Stock.

  Sep 30  Dec 31 
Balance 2017  2016 
       
Proceeds from promissory note $25,000  $25,000 
Value allocated to additional paid-in capital  25,000   25,000 
         
Balance allocated to convertible note payable  -   - 
Amortized discount  25,000   22,500 
Balance, convertible note payable $25,000  $22,500 
[b]

Series 1:

We sold a total of $1,050,000 in subordinated convertible note that bear interest at 6% per annum, mature on December 31, 2022 and may be converted at the noteholder’s option at any time into shares of our Common Stock at a fixed price of $0.021 per share.

The total discount of $25,000 was being amortized over 5 years starting July 2012. Accordingly, the annual interest rate was 20% and for the six months ended June 30, 2017 and 2016, $2,500 was recorded as interest expense. The note was fully amortized as at June 30, 2017.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 1221

The balance of the fourth convertible note payable convertible on the basis of $0.01 of debt to 1 common share at is as follows:

  Sep 30  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $25,000  $25,000 
Value allocated to additional paid-in capital  25,000   25,000 
         
Balance allocated to convertible note payable  -   - 
Amortized discount  22,500   18,750 
Balance, convertible note payable $22,500  $18,750 

The total discount of $25,000 is being amortized over 5 years starting April 2013. Accordingly, the annual interest rate is 20% and for the nine months ended September 30, 2017 and 2016, $3,750 was recorded as interest expense. As at September 30, 2017 the unamortized discount is $2,500.

There are two convertible notes payable convertible on the basis of $0.005 of debt to 1 common share

The balance of the first convertible note payable convertible on the basis of $0.005 of debt to 1 common share is as follows:

  Sep 30  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $10,000  $10,000 
Value allocated to additional paid-in capital  10,000   10,000 
         
Balance allocated to convertible note payable  -   - 
Amortized discount  10,000   10,000 
Balance, convertible note payable $10,000  $10,000 

The total discount of $10,000 was amortized over 5 years (20%) starting April 2011 and was fully amortized as at April 2016.

The balance of the second convertible note payable convertible on the basis of $0.005 of debt to 1 common share is as follows:

  Sep 30  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $10,000  $10,000 
Value allocated to additional paid-in capital  10,000   10,000 
         
Balance allocated to convertible note payable  -   - 
Amortized discount  10,000   9,250 
Balance, convertible note payable $10,000  $9,250 

[c]

Series 2:

On January 6, 2022, we sold one of our shareholders a $250,000 unsecured note payable that bears interest at 12% per annum and matures on April 6, 2022. In connection with the note sale, we issued the noteholder a Warrant to purchase 6,250,000 shares of our Common Stock, on a cashless exercise basis, at $0.021 per share at any time starting July 1, 2022 and ending July 1, 2024. We estimate the value of the Warrant to be $112,500, based on a $0.018 price per share of our Common Stock that is treated as a debt discount to be amortized over the term of the note. We have not yet repaid the noteholder.

On January 14, 2022, we sold one of our shareholders a $25,000 unsecured note payable that bears interest at 12% per annum and matures on April 6, 2022. In connection with the note sale, we issued the noteholder a Warrant to purchase 600,000 shares of our Common Stock, on a cashless exercise basis, at $0.021 per share at any time starting July 1, 2022 and ending July 1, 2024. We estimate the value of the Warrant to be $10,800, based on a $0.018 price per share of our Common Stock that we treated as a debt discount to be amortized over the term of the note. In May 2022, we repaid the note.

On February 17, 2022, we sold a $50,000 unsecured note payable that bears interest at 12% per annum and matures on April 6, 2022. In connection with the note sale, we issued the noteholder a Warrant to purchase 1,250,000 shares of our Common Stock, on a cashless exercise basis, at $0.021 per share at any time starting July 1, 2022, and ending July 1, 2024. We estimate the value of the Warrant to be $22,500, based on a $0.018 price per share of our Common Stock that we treat as a debt discount that we amortized over the term of the note. In April 2022, we repaid the note.

  
[d]

Series 3:

On February 15, 2022, we sold two $137,500 unsecured convertible notes payable bearing an 11.25% interest rate per annum that mature on February 23, 2023 and have a $15,000 original issue discount. In connection with the note sales, we issued the noteholders Warrants to purchase a total of 2,500,000 shares of our Common Stock at $0.10 per share, on a cashless exercise basis, that are exercisable at any time until February 11, 2027. We estimate the total value of the Warrants to be $90,000, based on a $0.018 price per share of our Common Stock that we treat as a debt discount and amortize over the terms of the notes along with the deferred financing fees. The notes’ principal and interest may be converted into our Common Stock at $0.02 per share.

[e]

Series 4:

On May 5, 2022, we sold a shareholder a convertible subordinate note totaling $110,000 that accrues interest at 12% per annum and matures on May 5, 2023. The loan may be converted into shares of our Common Stock at $0.02 per share. In connection with the note sale, we issued the noteholder a Warrant to purchase 5,000,000 shares of our Common Stock at $0.02 per share.

On June 24, 2022, we sold a convertible subordinate note totaling $110,000 that accrues interest at 12% per annum and matures on May 5, 2023. The note may be converted into shares of our Common Stock at $0.02 per share. In connection with the note sale, we issued the noteholder a Warrant to purchase 5,000,000 shares of our Common Stock at $0.02 per share.

[f]

Series 5:

On May 5, 2022, we sold an $82,500 note payable that has a $7,500 original issue discount and matures on May 5, 2023 and bears interest at 12% per annum. In connection with the note sale, we issued the noteholder a Warrant to purchase a total of 3,750,000 shares of our Common Stock at $0.02 per share, on a cashless exercise basis, that is exercisable upon issuance and up through May 5, 2029. We estimate the total value of the Warrants to be $67,500, based on a $0.018 price per share of our Common Stock that we treat as a debt discount and amortize over the term of the note. As of September 30, 2022, $82,500 in note principal is outstanding.

On May 5, 2022, we sold an $110,000 note payable that has a $10,000 original issue discount and matures on May 5, 2023 and bears interest at 12% per annum. In connection with the note sale, we issued the noteholder a Warrant to purchase a total of 5,000,000 shares of our Common Stock at $0.02 per share, on a cashless exercise basis, that is exercisable upon issuance and up through May 5, 2029. We estimate the total value of the Warrants to be $90,000, based on a $0.018 price per share of our Common Stock that we treat as a debt discount and amortize over the term of the note. As of September 30, 2022, $110,000 in note principal is outstanding.

[g]

Series 6:

On September 16, 2022, we sold a $55,000 note payable that has a $5,000 original issue discount and matures on September 16, 2023 and bears interest at 12% per annum. The note may be converted into shares of our Common Stock at the lessor of $0.001 per share or at a 50% discount to the lowest closing price of our Common Stock within the past twenty days prior to a conversion. As of September 30, 2022, $55,000 in note principal is outstanding.

On February 17, 2022, we sold a $50,000 unsecured note payable that bears interest at 12% per annum and matures on April 6, 2022. In connection with the note sale, we issued the noteholder a Warrant to purchase 1,250,000 shares of our Common Stock, on a cashless exercise basis, at $0.021 per share at any time starting July 1, 2022 and ending July 1, 2024. We estimate the value of the Warrant to be $22,500, based on a $0.018 price per share of our Common Stock that we treat as a debt discount that we amortized over the term of the note. In April 2022, we repaid the note.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 1322

Note 14 Related Party

We entered into a consulting agreement with Warren Zenna of Zenna Consulting Group to provide oversight of marketing and communications services. The total discountagreement commenced March 1, 2021 and ended on July 31, 2021. We paid Zenna Consulting Group $0 fees in the three months ended September 31, 2022 and 2021, respectively. Mr. Zenna is a member of $10,000 was amortized over 5 years (20%) starting May 2011our Board of Directors. On March 1, 2022, we granted a Warrant to Mr. Zenna to purchase up to 500,000 shares of our Common Stock at $0.025 per share, on a cashless exercise basis, at any time beginning September 1, 2022 and was fully amortized as at May 2016.

There was one convertible notes payable convertibleending September 1, 2026. We estimate the value the Warrant to be approximately $9,000, based on the basis$0.018 market price per share of $0.045our Common Stock on March 1, 2022.

Effective January 1, 2022, we entered into a management consulting agreement with GreenRock LLC, a company controlled by Philip Falcone, for a period of debtone year ending December 31, 2022, under which we provide monthly remuneration of $35,000, plus expenses in connection with his duties, responsibilities and performance as our chief executive officer. In February 2021, our subsidiary, Sovryn Holdings Inc., entered into consulting agreement with GreenRock LLC to 1 common share that was converted into 555,556 common sharesprovide us with chief executive officer services. In the three months ended September 31, 2022 and 2021, we paid GreenRock LLC $40,000 and $0 in fees, respectively. Mr. Falcone is the managing member of the Company on July 14, 2017:

The balanceGreenRock LLC and is our Chief Executive Officer. We paid GreenRock LLC bonuses of this convertible note payable is as follows:

  Sep 30  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $25,000  $25,000 
Value allocated to additional paid-in capital  25,000   25,000 
         
Balance allocated to convertible note payable  -     
Amortized discount  16,042   13,333 
Converted into shares  (16,042)  - 
Balance, convertible note payable $-  $13,333 

The total discount of $25,000 was being amortized over 5 years starting May 2014. Accordingly, the annual interest rate was 20%$255,794 and488,934 for the three and nine months ended September 30, 2017 was $2,709 and for2022.

During the ninethree months ended September 30, 2016, $3,750 was recorded2022, our Chief Executive Officer advanced us funds for our operations and as interest expense.of September 30, 2022, we owed $28,658 in advances.

ThereOn April 7, 2021, we issued 1,500,000 shares of our Common Stock to Mr. Canouse in exchange for transferring his 100 shares of our Series B Preferred Stock to FFO1 Irrevocable Trust, an entity controlled by Mr. Falcone, our CEO and Chairman of our Board of Directors. The shares were valued at $1,500. The 100 shares of Series B Preferred Stock that provide a 51% voting control regardless of the number of common or other voting securities we have issued at present or at any time in the future, such that the holder of the Series B Preferred shares shall maintain majority voting control over matters voted on by our shareholders. FFO1 Irrevocable Trust also holds 461,000 Preferred Series E-1 shares and FFO2 Irrevocable Trust holds 461,000 Preferred Series E-1 shares. Lisa Falcone, wife of Mr. Falcone, is one convertible notes payable convertiblethe trustee of FFO2 Irrevocable Trust and Ms. Falcone has shared voting and dispositive power.

Note 15 Mezzanine Equity

We account for certain of our Preferred Stock in accordance with the guidance in ASC Topic 480, Distinguishing Liabilities from Equity. Based on the basis of $0.15 of debt to 1 common share

The balance of this convertible note payableguidance, preferred stock that is conditionally redeemable is classified as follows:

  Sep 30  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $25,000  $25,000 
Value allocated to additional paid-in capital  25,000   25,000 
         
Balance allocated to convertible note payable        
Amortized discount  12,500   8,750 
Balance, convertible note payable $12,500  $8,750 

The total discount of $25,000 is being amortized over 5 years starting April 2015.temporary or “mezzanine” equity. Accordingly, the annual interest ratevarious Series of Preferred Stock, which is 20% andsubject to conditional redemption, is presented at redemption value as mezzanine equity outside of the stockholders’ equity section of the consolidated balance sheets

Preferred Shares

Series A Preferred Stock

On February 16, 2021, we cancelled all the Preferred Series A shares. In exchange, the holders of Series A Preferred shares received one-year option agreements to purchase shares of our wholly owned subsidiary at the time, CZJ License, Inc. at $10 per share for the nine months ended September 30, 2017 and 2016, $3,750 was recorded as interest expense. As at September 30, 2017 the unamortized discount was $12,500.up to 300,000 shares. The option agreement expired without being exercised.

There were two convertible notes payable convertible on the basis of $0.05 of debt to 1 common share

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 1423

The balanceSeries C Preferred Stock

There are 10,000 designated and authorized Series C Preferred Stock. Holders of Series C Preferred Stock shall be entitled to receive, when and as declared, dividends equal to 2% per annum on the first convertible notestated value, payable is as follows:

  Sep 30  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $21,000  $21,000 
Value allocated to additional paid-in capital  21,000   21,000 
         
Balance allocated to convertible note payable  -   - 
Amortized discount  3,570   1,680 
Balance, convertible note payable $3,570  $1,680 

The total discountin additional shares of $21,000 is being amortized at 12% starting May 2016. For the nine months endedSeries C Preferred Stock. As of September 30, 2017, $1,890 was recorded as interest expense,2022 and $1,680 was recorded as interest expense during year ended December 31, 2016. As at September 30, 2017 the unamortized discount is $17,430.

The second convertible note payable convertible on the basis of $0.05 of debt to 1 common share was converted into 400,000 common2021, no shares of the Company on July 14, 2017 as follows:Series C Preferred Stock are outstanding.

  Sep 30  Dec 31, 
Balance 2017  2016 
       
Proceeds from promissory note $20,000  $20,000 
Value allocated to additional paid-in capital  20,000   20,000 
         
Balance allocated to convertible note payable  -   - 
Amortized discount  1,700   400 
Converted into shares  (1,700)  - 
Balance, convertible note payable $-  $400 

Series D Preferred Stock

The total discountThere are 230,000 designated and authorized Series D Preferred Stock with a 4.99% conversion cap which may be increased to a maximum of $20,000 was being amortized at 12% starting November 2016. For the nine months ended September 30, 2017, $1,300 was recorded as interest expense, and $400 was recorded as interest expense during the year ended December 31, 2016. This note converted into 400,000 common shares of the Company on July 14, 2017.

9.99% by holder by written notice to us. There is onea stated value of $3.32 per share, subject to adjustment for stock splits, stock dividends, recapitalizations, reorganizations, reclassifications, combinations, subdivisions or other similar events occurring after the date which the Series D are issued. Series D are ranked as a Senior Preferred Stock and have no voting rights. Each share of Series D Preferred Stock may be converted to 1,000 common shares.

On February 16, 2021, we settled $1,028,000 in note payables, convertible notes payable convertibleand accrued interest for 230,000 shares of our Series D Preferred Stock, of which 75,000 shares of Series D Preferred Stock were converted into 75,000,000 shares of our Common Stock and 155,000 Series D Preferred shares remain unconverted and outstanding as of September 30, 2022 and December 31, 2021.

Series E Preferred Stock

On February 16, 2021, we issued 1,000 shares of Series E Preferred Stock to acquire Sovryn that we valued at $4,225,062 based on value of 100% of our Common Stock at the time.

On September 16, 2021, the holders of our Series E Preferred Stock entered into an Exchange Agreement with us whereby on October 11, 2021, the 1,000 Series E Preferred shares were exchanged for 1,152,500 Series E-1 Preferred shares and 1,091,388,889 shares of Common Stock. We valued the exchange at the same $4,225,062 value as was assigned to the 1,000 shares of Series E Preferred Stock. As of September 30, 2022 and December 31, 2021, no shares of Series E Preferred Stock are outstanding.

Series E-1 Preferred Stock

There are 1,152,500 designated and authorized Series E-1 Preferred Stock that we issued on October 11, 2021 in exchange for our Series E Preferred Stock. At September 30, 2022 and December 31, 2021, 1,152,500 Preferred Series E-1 shares remain outstanding. Each share of Series E-1 Preferred Stock may be converted to 1,000 common shares.

Series F Preferred Stock

There are 1,000 designated and authorized Series F Preferred Stock. On February 17, 2021, we issued the Investors 1,000 shares of Series F Preferred Stock that convert into 192,073,017 shares of Common Stock, which we valued at $864,000, based on the basisunderlying value of $0.04shares our Common Stock that were $0.0045 per share at the time. On October 11, 2021, the 1,000 shares of debt to 1 common share

The balanceSeries F Preferred Stock were converted into 192,073,017 shares of this convertible note payable is as follows:

  Sep 30  Dec 31 
Balance 2017  2016 
       
Proceeds from promissory note $20,000  $20,000 
Value allocated to additional paid-in capital  20,000   20,000 
         
Balance allocated to convertible note payable      - 
Amortized discount  1,800   600 
Balance, convertible note payable $1,800  $600 

The total discountCommon Stock. As of $20,000 is being amortized at 12% starting October 2016. For the nine months ended September 30, 2017, $1,800 was recorded as interest expense,2022 and $600 was recorded as interest expense during the year ended December 31, 2016. As2021, no shares of Series F Preferred Stock are outstanding.

Series G Preferred Stock

We received $4,600,000 in subscriptions for 4,600 of Series G Preferred Shares that we valued at $1,000 per share based on the cash price. On November 2, 2021, all of the 4,600 authorized and issued shares of Series G Preferred Stock were converted into 255,555,556 shares of our Common Stock. At September 30, 2017 the unamortized discount is $17,600.2022 and December 31, 2021, no shares of Series G Preferred Stock are outstanding.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 1524

Series H Preferred Stock

On November 11, 2021, pursuant to an Exchange Agreement that we entered into with the Investors, 39,895,000 of our Common shares held by the Investors were exchanged for 39,895 shares of our Series H Preferred Stock and we cancelled the 39,895,000 Common shares. Each share of Series H Preferred Stock may be converted to 1,000 common shares, subject to a maximum ownership limit of 9.99%. We valued the 39,895,000 Common shares and 39,895 Series H Preferred shares at $3,989,500. At September 30, 2022 and December 31, 2021, 39,895 shares of Series H Preferred Stock remain outstanding.

Note 16 Shareholders’ Equity

Preferred Stock

As of September 30, 2022 and December 31, 2021, we are authorized to issue 50,000,000 shares of $0.001 par value Preferred Stock, with designations, voting, and other rights and preferences to be determined by our Board of Directors of which 48,617,400 remain available for designation and issuance.

Series B Preferred Stock

There are 100 designated and authorized Series B Preferred Stock. Holders of Series B Preferred Stock have the right to vote on all shareholder matters equal to 51% of the total vote of Common stockholders. The Series B Preferred Stockholder is entitled to 51% voting rights regardless of the number of common shares or other voting shares issued by the company at any time. Such provision grants the holder of Series B Preferred Stock majority control of us, unless otherwise canceled.

On July 17, 2020, 100 Series B Preferred Stock were issued pursuant to the License Agreement. The Series B Preferred Stock was valued at par at $0.001. Although the Series B Preferred Stock is entitled to 51% voting rights as described above, the stock has no dividend rate nor conversion feature. Furthermore, the shares were not issued to the investors, but rather were granted to new unrelated management.

On February 17, 2021, the 100 Series B Preferred Stock were transferred from Mr. Canouse (our former director and CEO), to FFO1 Irrevocable Trust, a company Mr. Falcone (our director and CEO) is the trustee and has the voting and dispositive power.

At September 30, 2022 and December 31, 2021, there were 100 Series B Preferred shares outstanding, respectively.

Common Stock

In August 14, 2021, our shareholders approved an increase in authorized Common Stock to 6,000,000,000 from 1,000,000,000, which became effective the same day. As of September 30, 2022 and December 31, 2021 there were 1,599,095,027, and 1,599,095,027, shares outstanding, respectively.

Our Board of Directors and majority stockholder approved the decision to not move forward with a reverse stock split ratio of 25 to 1 share, and approved a reverse stock split ratio from 10 to 1 share, which is currently subject to regulatory approval.

Warrants

On February 17, 2021, we issued 192,073,017Warrants to Arena Investors that are exercisable for a five-year period from the date of issuance and, based on an amendment made on September 24, 2021, the Warrants may be converted into our Common Stock at $0.02 per share, subject to a maximum ownership limit of 9.99%. The exercise price is subject to adjustment due to stock dividends, stock splits and recapitalizations and other events. We valued the Warrants at $864,000 based on a value of $0.0045 per share for our Common Stock at the time.

Form 10-Q – Q2Madison Technologies Inc.Page 25

On December 28, 2021, we entered into a promissory note payable and provided 500,000 Warrants. Each Warrant is exercisable at $0.025 per share and expires on December 31, 2023. We valued the Warrants at $9,000 based on a value of $0.018 per share for our Common Stock at the time.

The Warrants issued are loan incentives. The value was allocated to the warrants based on fair value on the date of the grant as determined using the Black-Scholes option pricing model.

For the nine months ended September 30, 2022, a summary of our warrant activity is as follows:

Schedule of Warrants Activity

  Number of
Warrants
  Weighted-
Average
Exercise
Price
  Weighted-
Average
Remaining
Contractual
Term
(Years)
  Weighted-
Average Grant-
Date Fair Value
  Aggregate
Intrinsic
Value
 
Outstanding and exercisable at January 1, 2022  192,573,017  $0.020   4.13  $1,926,663  $3,464,529 
                   - 
Issued  38,600,000  $0.023   4.28   83,348  $694,800 
Exercised  -   -   -   -   - 
Expired  -   -   -   -   - 
Outstanding and exercisable at September, 2022  231,173,016  $0.021   3.73  $1,618,876  $4,159,329 

Form 10-Q – Q2Madison Technologies Inc.Page 26

Note 17 Discontinued Operations

On February 16, 2021, we cancelled all the Series A Preferred Stock shares and offered their holder’s option agreements to purchase up to 300,000 shares of CZJ License, Inc., our wholly owned subsidiary at the time, at an option price of $10 per share. The option agreements are exercisable for a period of one year from the date of issuance and were not exercised.

On November 15, 2021, we entered into a Purchase and Sale agreement with ZA Group Inc. to sell CZJ License Inc. for $250,000. At Closing, the ZA Group Inc. delivered a convertible promissory note with a principal amount equal to the purchase price. The interest rate on the note was 5% per annum and matures on November 5, 2023. The note may be converted, from time to time, after 180 days from the issuance date of the note into common stock of ZA Group Inc., at a fixed conversion price of $0.005 per share, subject to a beneficiary ownership limitation of not more than 4.99% of the outstanding shares of common stock of ZA Group Inc.

At November 15, 2021, CZJ License Inc.’s accounts were eliminated from the consolidated financial statements. All expenses incurred by CZJ License Inc. up to November 15, 2021 have been disclosed as discontinued operations. The previous year’s assets, liabilities and expenses have been similarly classified for comparative purposes.

Schedule of Previous Year Assets Liabilities and Expenses

         
Assets        
Prepaid Expenses $-  $37,218 
Website  -   10,000 
Intangible Assets - License  -   423,410 
Assets  -   470,628 
         
Liabilities        
Accounts Payable & Accrued  -   33,500 
Liabilities  -   33,500 
Expenses        
Amortization  74,760   64,687 
Selling, general and administrative  190,857   152,939 
Professional fees  213,500   172,750 
       - 
Expenses $479,117  $390,376 

Form 10-Q – Q2Madison Technologies Inc.Page 27

Note 18 Commitments

On September 28, 2020, we entered into a one-year renewable employment agreement with Mr. Canouse, our Chief Executive Officer at the time. In the three months ended September 31, 2022 and 2021, Mr. Canouse received $24,487 and $0, respectively. Mr. Canouse resigned on July 1, 2022.

On February 17, 2021, we sold the Investors $16,500,000 of Notes and we entered into a Security Agreement and a Guaranty Agreement with the Investors that secure the Notes with liens on all of our tangible and intangible assets. We have not yet made the $0.4 million interest payments on the Notes held by Arena Partners LC that were due on April 1, 2022 and July 1, 2022, and as a result, under the Note terms, the interest rate is 20.0% per annum. We are currently in discussions with the Investors on a plan of forbearance; however, there is no assurance that we will be successful in completion of a plan, which may disrupt our operations and result in a restructuring of obligations.

On October 20, 2021, we entered into a Stock Acquisition Agreement with Top Dog Productions Inc., Jay Blumenfield and Anthony Marsh whereby we will acquire all of the shares of Top Dog Productions Inc., and in exchange, we will pay the purchase price of 12,500,000 shares of our Common Stock. The Closing is subject to receipt of audited and other financial statements of Top Dog Productions, other deliverables, and terms and conditions. At the closing, we will issue a total of 12,500,000 shares of our Common Stock and may issue an additional 12,500,000 Common shares should Top Dog Productions, Inc. achieve financial performance milestones stated in the Stock Acquisition Agreement.

On January 12, 2022, we entered into a consulting agreement with EF Hutton as a lead underwriter. The agreement is for one year and we may terminate the agreement on or after 270th day with 30-days written notice. EF Hutton may terminate the agreement on or after 120 days from execution of the agreement. EF Hutton agrees to provide underwriting the sale of up to $20 million of securities. In return, we grant EF Hutton an option to acquire up to 15% of the total number of securities we offer , provide an underwriting discount of 7% of the total gross proceeds, provide warrants equal to 5% of the aggregate number of shares of Common Stock sold in the offering, warrants to be exercisable at any time in whole or in part for 4 ½ years commencing 6 months from the effective date of offering at a price per share equal to 100% of the public offering price per security. EF Hutton may also provide advisory services for a cash fee of 7% of capital raised for equity placements, 6% for debt placements, closing warrants equal to 3% of aggregate proceeds sold in offering with the warrants to expire in 5 years. We agree to pay expenses for marketing, promotional materials and other costs associated with the work.

In January 2022, we entered into a six-month consulting agreement with a third party to provide strategic and business services relating to the blockchain project that we amended in February 2022. The first two months are payable at $25,000 per month and the remaining four months are payable at $10,000 per month. We have paid $25,000 to date.

In February 2022, we entered into a consulting agreement to establish, launch, manage, operate and produce a 24/7 broadcast network devoted to cryptocurrency, NFT, Web3 and blockchain technology. In consideration for the wide range and scope of work, we agreed to pay the consultant a fee in the aggregate of $600,000, of which $450,000 has been paid and $150,000 is payable upon the launch of the network.

In February 2022, we entered into a consulting agreement with a third party to provide corporate marketing strategy, creation and development of content for distribution, market development, communications, products and growth. The agreement ends the earlier of September 30, 2022 or when an executed Employment Agreement is signed with us. Upon execution of the consulting agreement, we paid the consultant $100,000 and we are obligated to pay a service fee $30,000 per month for March through June. As part of the arrangement, we granted the consultant a Warrant to acquire up to 160,000,000 shares of our Common Stock at an exercise price of $0.025 per share that is contingent upon our entering into an Employment Agreement or extending the consulting agreement, which did not occur. As of the date of this report, we paid $160,000.

Form 10-Q – Q2Madison Technologies Inc.Page 28

In March 2022, we entered into a six-month service agreement for press releases, campaigns and social media advertisings. The service fee is $30,000 per month plus expenses. The agreement may not be terminated during the initial six months and we must provide no less than 30-day prior written notice to the termination.

Note 19 Income Taxes

Income tax recovery differs from that which would be expected from applying the effective tax rates to the net income (loss) as follows:

Schedule of Income Tax Expense

  September 30, 2022  September 30, 2021 
Net loss for the nine-month period $(6,949,431) $(856,777)
Statutory and effective tax rates  21.0%  21.0%
Income taxes expenses (recovery) at the effective rate $(1,459,380) $(179,923)
Effect of change in tax rates  -   - 
Permanent differences  -   - 
Valuation allowance  1,459,380   179,923 
Income tax expense and income tax liability $-  $- 

As of September 30, 2022 and December 31, 2021 the tax effect of the temporary timing differences that give rise to significant components of deferred income tax asset are noted below. A valuation allowance has been recorded as management believes it is more likely than not that the deferred income tax asset will not be realized.

Schedule of Deferred Income Tax Asset

  September 30, 2022  December 31, 2021 
Tax loss carried forward $-  $- 
         
Deferred tax assets $4,454,522  $2,995,142 
Valuation allowance  (4,454,522)  (2,995,142)
Deferred taxes recognized $-  $- 

Tax losses of approximately $14 million will expire in 2040

Form 10-Q – Q2Madison Technologies Inc.Page 29

ItemITEM 2. Management’s Discussion and Analysis of Financial Condition and Results of Operation.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

The following discussion of Madison Technologies Inc’sour financial condition, changes in financial condition and results of operations for the three and nine months ended September 30, 20172022 should be read in conjunction with Madison’sour unaudited condensed consolidated financial statements and related notes for the three and nine months ended September 30, 2017.2021.

Forward Looking Statements

This quarterly reportQuarterly Report on Form 10-Q contains forward-looking statements withinthat have been made pursuant to the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. These forward-looking statements involve risks and uncertainties, including statements regarding Madison’s capital needs, business plans and expectations. Such forward-looking statements involve risks and uncertainties regarding Madison’s ability to carry out its planned exploration programs on its mineral properties. Forward-looking statements are made, without limitation, in relation to Madison’s operating plans, Madison’s liquidity and financial condition, availability of funds, operating and exploration costs and the market in which Madison competes. Any statements contained herein that are not statements of historical facts may be deemed to be forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “may”, “will”, “should”, “expect”, “plan”, “intend”, “anticipate”, “believe”, “estimate”, “predict”, “potential” or “continue”, the negative of such terms or other comparable terminology. Actual events or results may differ materially. In evaluating these statements, you should consider various factors, including the risks outlined below, and, from time to time, in other reports Madison files with the SEC. These factors may cause Madison’s actual results to differ materially from any forward-looking statement. Madison disclaims any obligation to publicly update these statements, or disclose any difference between its actual results and those reflected in these statements. The information constitutes forward-looking statements within the meaningprovisions of the Private Securities Litigation Reform Act of 1995. GivenThese forward-looking statements are based on current expectations, estimates, and projections about DLT Resolutions’ industry, management’s beliefs, and certain assumptions made by management. Forward-looking statements include our expectations regarding product, services, and maintenance revenue, annual savings associated with the organizational changes effected in prior years, and short- and long-term cash needs. In some cases, words such as “anticipates,” “expects,” “intends,” “plans,” “believes,” “estimates,” variations of these uncertainties, readerswords, and similar expressions are cautioned notintended to place undue reliance on suchidentify forward-looking statements. In addition, statements about the potential effects of the COVID-19 pandemic on the Company’s businesses, results of operations and financial condition may constitute forward-looking statements. The statements are not guarantees of future performance and are subject to certain risks, uncertainties, and assumptions that are difficult to predict; therefore, actual results may differ materially from those expressed or forecasted in any forward-looking statements. Risks and uncertainties of our business include those set forth in our Annual Report on Form 10-K for the year ended December 31, 2021, as filed with the SEC on August 26, 2022, under “Item 1A. Risk Factors” as well as additional risks described in this Form 10-Q. Unless required by law, we undertake no obligation to update publicly any forward-looking statements, whether as a result of new information, future events, or otherwise. However, readers should carefully review the risk factors set forth in other reports or documents we file from time to time with the Securities and Exchange Commission, particularly the Quarterly Reports on Form 10-Q and any Current Reports on Form 8-K.

Form 10-Q – Q3Madison Technologies Inc.Page 16

GENERAL

Madison Technologies Inc. (”(“Madison”) is a Nevada corporation that was incorporated on June 15, 1998. Madison was initially incorporated under the name “Madison-Taylor General Contractors, Inc.” Effective May 24, 2004, Madison changed its name to “Madison Explorations, Inc.” by a majority vote of the shareholders. Effective March 9, 2015, Madison changed its name to “Madison Technologies Inc.,” by a majority vote of the shareholders. See Exhibit 3.3 – Certificate of Amendment for more details.

On September 6, 2016, Joseph Gallo resigned as the Chief Financial Officer, the Chief Financial Officer, and the Corporate Secretary, and as a director of Madison. In addition, on September 6, 2016, Mr. Thomas Brady consented to and was appointed the Chief Executive Officer, the Chief Financial Officer and the Corporate Secretary of Madison by the board of directors.

The board of directors of Madison currently consists of Thomas Brady as the Chief Executive Officer and the Corporate Secretary and Joseph Gallo, the Chief Financial Officer of Madison. Please see Item 5.02 of the Form 8-K filed on September 8, 2016 and May 31, 2017 for information relating to these director and officer changes

On September 16, 2016 Madison entered into a material definitive agreement with Tuffy Packs, LLC to acquire an exclusive licensing agreement for the distribution of Tuffy Pack’s product line into the United Kingdom and 43 European countries. According to the terms and conditions of the product license agreement Madison will pay an aggregate amount of $50,000 for the exclusive license to distribute Tuffy Packs’ product line. Tuffy Packs manufactures a line of custom inserts that provide a level of personal protection from ballistic threats similar to what law enforcement officers wear daily as bulletproof vests. The ballistic panels conform to the National Institute of Justice (NIJ) Level IIIA threat requirements.

Please see Item 1.01 of the Form 8-K filed on September 19, 2016 for information relating to the Product License Agreement as well please see Item 1.01 and Item 2.01 of the Form 8-K filed on September 23, 2016 for information relating to the Product License Agreement and for a description of Madison’s business.

On September 26, 2016, Thomas Brady and Steven Cozine entered into a share purchase agreement for the purchase and sale of 3,088,500 shares in the capital of Madison for the purchase price of $1,000.00. Please see Item 5.01 of the Form 8K filed on October 3, 2016 and see Exhibit 10.1 – Share Purchase Agreement for information relating to the change in control of the registrant.

On October 12, 2016, Madison TechnologiesWe, through our wholly-owned subsidiary, Sovryn Holdings, Inc. (“Madison”Sovryn”) received approval from Amazon Europeacquired three un-affiliated Class A/LPTV TV. Each licensed TV station can broadcast between 10 and 12 channels over-the-air, 24 hours per day/7 days per week. We generated revenue by leasing channels to begin sales of its Tuffy Pack line of productsthird parties on KNLA/KNET, a Class A television station in the United Kingdom through the Amazon Marketplace. On October 14, 2016, Madison received approval from Amazon Europe to begin sales of its Tuffy Pack line of productsLos Angeles, KVVV, a low power television station in Germany, Italy, SpainHouston and France through the Amazon Marketplace. As of October 21, 2016, Madison had completed its first sale through the Amazon Marketplace also on October 21, 2016 Madison ceased to beKYMU-LD, a shell company as definedlow power television station in Rule 12b-2 of the Exchange Act. Please see Item 5.06 of the Form 8-K filed on October 21, 2016 for information relating to the change in shell status.Seattle.

On May 26, 2017, Joseph Gallo consented to and was appointed as an additional director of Madison. Also, on May 26, 2017, Mr. Gallo consented to and was appointed the Chief Financial Officer of Madison by the board of directors. Please see item 5.02 of the Form 8-K filed on May 31, 2017 for information relating to the director and officer changes

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 1730

RESULTS OF OPERATIONS

Our financial statements have been prepared assuming that we will continue as a going concern and, accordingly, do not include adjustments relating to the recoverability and realization of assets and classification of liabilities that might be necessary should we be unable to continue in operation. We expect we will require additional capital to meet our long term operating requirements. We expect to raise additional capital through, among other things, the sale of equity or debt securities.

NineThree months ended September 30, 20172022 and September 30, 20162021

Our net lossRevenues

Net Revenues increased to $485,497 for the nine-month periodthree months ended September 30, 2017 was $54,330(2016: $35,957), which consisted2022 from $464,028 for the three months ended September 30, 2021. The increase resulted from the acquisition of generalthe KYMU television station in September 2021 and administration expenses and amortization and interest.operated throughout the three months ended September 30, 2022. We generated $6,255 in revenue during nine-month period in fiscal 2017anticipate 2022 Net Revenues will increase compared to nil2021 Net Revenues as a result a full year of operating the television stations acquired during 2021 and the nine-month periodlaunch of BLOCKCHAIN.TV in 2016.2022.

Amortization

Amortization increased to $80,993 for the three months ended September 30, 2022 from ($57,437) for the three months ended September 30, 2021. The increase in expensesamortization expense resulted from the reduction in the current fiscal year relateestimated fair values of amortizable tangible and intangible television station assets as determined by an independent valuation in 2021, which also resulted in a one-time retroactive reduction in amortization expense recognized in the three months ended September 30, 2021.

Selling, general and administrative fees

Selling, general and administrative fees increased to $272,533 for the three months ended September 30, 2022 from $198,567 for the three months ended September 30, 2021. The increase was primarily the result of increase personnel expenses we incurred in three months ended September 30, 2022 as we added personnel for the launch of BLOCKCHAIN.TV and to perform administrative duties that had been outsourced and incurred professional fees.

Television operations

Television operation expenses are $85,800 and $74,889 for the three months ended September 30, 2022 and 2021. The expenses are direct costs of operating the television stations we acquired in 2021.

Professional Fees

Professional fees decreased to $416,019 for the three months ended September 30, 2022 from $741,296 for the three months ended September 30, 2021. The decrease was primarily the result of an increase in both generalthe legal and administrativeaccounting expense associated with the 2021 acquisitions of television stations, the financing associated with those acquisitions, management fees and, amortizationthe expense related almost exclusively to our Tuffy Pack licence agreement obligations.

The weighted average number of shares outstanding was 11,575,016associated with regulatory filings for the nine-month period ended September 30, 2017 and 11,302,000 forSEC, including the nine-month period ended September 30, 2016.Form S1 Registration in 2021.

Liquidity and Capital Resources

Cash and Working Capital

As at September 30, 2017, Madison had cash of $4,720 and a working capital deficit of $334,546, compared to cash of $14,259 and working capital deficit of $316,708 as at December 31, 2016.

There are no assurances that Madison will be able to achieve further sales of its common stock or any other form of additional financing. If Madison is unable to achieve the financing necessary to continue its plan of operations, then Madison will not be able to continue and its business will fail.

The officers and directors have agreed to pay all costs and expenses of having Madison comply with the federal securities laws (and being a public company, should Madison be unable to do so). Madison’s officers and directors have also agreed to pay the other expenses of Madison, should Madison be unable to do so. To continue its business plan, Madison will need to secure financing for its business development. Madison currently has no source for funding at this time.

If Madison is unable to raise additional funds to satisfy its reporting obligations, investors will no longer have access to current financial and other information about its business affairs

Net Cash Used in Operating Activities

Madison used cash of $9,539 in operating activities during the first nine months of fiscal 2017 compared to cash used of $23,960 in operating activities during the same period in the previous fiscal year. The decrease in cash out flow from operations reflects the fact that the company had revenue in 2017.

Net Cash Provided (Used in) Investing Activities

Net cash used in investing activities was nil for the first Nine months of fiscal 2017 as compared with cash flow from investing activities of nil for the same period in the previous fiscal year.

Net Cash Provided by Financing Activities

Net cash flows provided by financing activities were nil for the first nine months of fiscal 2017, from proceeds of a convertible note payable. Madison generated $41,000 from financing activities during the first nine months of fiscal 2016.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 1831

PlanInterest Expense

Interest expense decreased to $1,520,742 for the three months ended September 30, 2022 from $1,927,580 for the three months ended September 30, 2021. The decrease resulted from the costs of Operationfinancings associated with the acquisitions of television stations and development of BLOCKCHAIN.TV that had amortization periods that expired prior to the three months ended September 30, 2022.

Discontinued Operations

Our planincome from discontinued operations was $0 and $32,722 for the three months ended September 30, 2022 and 2021, respectively. On November 15, 2021, we sold our subsidiary, CZJ License Inc. and designated its operations as discontinued. The previous year’s assets, liabilities and expenses have been similarly classified for comparative purposes.

Net Loss

Net Loss decreased to $1,880,556 for the three months ended September 30, 2022, from $2,405,292 for the three months ended September 30, 2021. The decrease was primarily the result of $406,838 decrease in interest expense for debt instruments we issued in 2021 and the $325,277 decrease in professional fees. Net Loss on a basic and diluted basis of $0.001 per share for the three months ended September 30, 2022, based on 1,599,095,027 weighted average shares outstanding, as compared to a Net Loss of $0.096 per share for the three months ended September 30, 2021, based on 24,972,565 weighted average shares outstanding. The increase in weighted average shares outstanding relates primarily to issuances of 192,073,017 shares to the Investors on October 11, 2021 in connection with the $16,500,000 Notes we sold, the 1,091,388,889 shares we issued on October 11, 2021 to Preferred Series E-1 holders in pursuant to an Exchange Agreement and the 255,555,556 shares we issued on November 2, 2021 in exchange for 4,600 shares of our Series G Preferred Stock.

Nine months ended September 30, 2022 and 2021

Revenues

Net Revenues increased to $1,431,762 for the nine months ended September 30, 2022 from $760,053 for the nine months ended September 30, 2021. The increase resulted from the acquisitions of television stations in 2021 and the revenues generated by the lease agreements held by those stations. We anticipate 2022 Net Revenues will increase compared to 2021 Net Revenues as a result a full year of operating the television stations acquired during 2021 and the launch of BLOCKCHAIN.TV in 2022.

Amortization

Amortization increased to $242,481 for the nine months ended September 30, 2022 from $177,006 for the nine months ended September 30, 2021. The increase in amortization expense resulted from having the amortizable tangible and intangible television station assets for the entire nine-month period in 2022 as compared to 2021 when the assets were acquired at different times during the 2021 nine-month period.

Selling, general and administrative fees

Selling, general and administrative fees decreased to $753,378 for the nine months ended September 30, 2022 from $433,025 for the nine months ended September 30, 2021. The increase was primarily the result of increase personnel expenses we incurred in nine months ended September 30, 2022 as we added personnel for the launch of BLOCKCHAIN.TV and to perform administrative duties that had been outsourced and incurred professional fees.

Form 10-Q – Q2Madison Technologies Inc.Page 32

Television operations

Television operation expenses are $257,483 and $178,869 for the nine months ended September 30, 2022 and 2021. The expenses are direct costs of operating the television stations we acquired in 2021. The increase in expense resulted from operating the television station assets for the entire nine-month period in 2022 as compared to 2021 when the assets were acquired at different times during the 2021 nine-month period.

Professional Fees

Professional Fees increased to $2,556,767 for the nine months ended September 30, 2022 from $1,745,592 for the nine months ended September 30, 2021. The increase was primarily the result of an increase in professional engaged to assist with development of our business and preparations for the launch of BLOCKCHAIN.TV in 2022. In 2021, professional fees were primarily legal and accounting expenses associated with the acquisitions of television stations, the financing associated with those acquisitions, management fees and, the expense associated with regulatory filings for the SEC, including the Form S1 Registration.

Loss on asset disposals

Our loss on asset disposals was $52,668 and $17,417 for the nine months ended September 30, 2022 and 2021. Our initial objective was to create one the largest, most comprehensive, state of the art OTA content distribution platforms to capitalize on the changing media and distribution landscape and on the growing OTA viewership in the U.S. We are exploring more capital efficient and technology centric alternatives to its planned station acquisition distribution platform. While there is to continue to deliver the Tuffy Pack licensed products into the European and UK retail and wholesale markets via the use of online market and fulfilment services including but not limited to Amazon.eu, Ebay and Ecwid. By implementing these companies’ services Madisonno guarantee that it will be ablesuccessful with this alternative approach, we have determined that it will postpone further capital expenditures on acquisitions and as a result, the planned acquisitions have been terminated and future acquisition plans have been put on hold while we evaluate this alternative approach. As a result, we recognized a $52,668 of loss from disposition of OTA assets.

Interest Expense

Interest expense increased to establish$4,547,497 for the nine months ended September 30, 2022 from $3,129,983 for the nine months ended September 30, 2022. The $1,417,514 increase resulted from having a reliable supply chain that will receive deliveryhigher amount of outstanding financings associated with the acquisition of television stations and development of BLOCKCHAIN.TV and having the $16,500,000 Notes outstanding for the entire nine-month period in 2022.

Discontinued Operations

Our loss from discontinued operations was $0 and $40,323 for the nine months ended September 31, 2022 and 2021, respectively. On November 15, 2021, we sold our subsidiary, CZJ License Inc. and designated its operations as discontinued. The previous year’s assets, liabilities and expenses have been similarly classified for comparative purposes.

Net Loss

Net Loss increased to $6,949,431 for the nine months ended September 30, 2022 from $4,961,892 for the nine months ended September 30, 2021. The increase was primarily the result of the Licensed Products, warehouse$1,417,514 increase in interest expense and $806,175 increase in professional fees. Net Loss on a basic and diluted basis of $0.004 per share for the Licensed Products, packagenine months ended September 30, 2022, based on 1,599,095,027 weighted average shares outstanding, as compared to a Net Loss of $0.203 per share for the Licensed Package as per each customer order, and ship the Licensed Productsnine months ended September 30, 2021, based on 24,439,598 weighted average shares outstanding. The increase in weighted average shares outstanding relates primarily to issuances of 192,073,017 shares to the customer efficientlyInvestors on October 11, 2021 in connection with the $16,500,000 Notes we sold, the 1,091,388,889 shares we issued on October 11, 2021 to Preferred Series E-1 holders in pursuant to an Exchange Agreement and cost effectively.the 255,555,556 shares we issued on November 2, 2021 in exchange for 4,600 shares of our Series G Preferred Stock.

Management expects Madison’s sales distribution strategy to be operational by September 2017, this includes the following components:

 
1.Form 10-Q – Q2Initial inventory with an estimated cost of $10,000
Madison Technologies Inc.
2.Social media and online advertising of $10,000
3.Payments to be made under Product License Agreement of $33,500Page 33

At the date of this filing Madison has paid $16,500 of the $50,000.Liquidity and Capital Resources

Madison sales strategy is to develop online exposure through the use of social media marketingCash and sending demo packs of the Licensed Products to both online bloggers and established gun owner clubs. The demo packs will include both new products as well as examples of the products that have been tested and exposed to gunfire to demonstrate the products effectiveness.Working Capital

Management anticipates incurring the following expenses during the next 12 month period:

Management anticipates spending approximately $2,500 in ongoing general and administrative expenses per month for the next 12 months, for a total anticipated expenditure of $30,000 over the next 12 months. The general and administrative expenses for the year will consist primarily of professional fees for the audit and legal work relating to Madison’s regulatory filings throughout the year, as well as transfer agent fees, and general office expenses.
Management anticipates spending approximately $15,000 in complying with Madison’s obligations as a reporting company under theSecurities Exchange Act of 1934 and as a reporting issuer in Canada. These expenses will consist primarily of professional fees relating to the preparation of Madison’s financial statements and completing and filing its annual report, quarterly report, and current report filings with the SEC and with SEDAR in Canada.

As at September 30, 2017, Madison2022, we had $8,804 in cash and a $9,866,871 working capital deficit, compared to cash of $4,720$55,656 and a working capital deficit of $334,546. Accordingly, Madison$4,373,271 as at December 31, 2021.

We will require additional capital to meet our long-term operating requirements. We have not yet made the $0.4 million interest payments on the Notes held by Arena Partners LC that were due on April 1, 2022 and July 1, 2022, and as a result, under the Note terms, the interest rate is 20.0% per annum. We are currently in discussions with Arena Capital LP, on a plan of forbearance; however, there is no assurance that we will be successful in completion of a plan, which may disrupt our operations and result in a restructuring of obligations.

We expect to raise additional capital through the sale of equity and/or debt securities; however, there is no assurance that we will be successful at raising additional capital in the future. If our plans are not achieved and/or if significant unanticipated events occur, we may have to further modify our business plan, which may require us to raise additional capital. As of September 30, 2022, our principal source of liquidity was our cash, which totaled $22,543. Historically, our principal sources of cash have included proceeds from the sale of common stock and preferred stock and related party loans. Our principal uses of cash have included cash used in operations, to make acquisitions and to pay interest on our Notes. We expect that the principal uses of cash in the future will be for continuing operations associated with rolling out the business plan and for interest payments.

Net Cash Used in Operating Activities

We used cash of $1,342,369 in operating activities during nine months ended September 30, 2022 compared to cash used of $4,182,398 in operating activities during the previous year’s nine-month period. The increase was primarily the result of increase in expenses associated with the build out and roll out of our business plan.

Net Cash Used in Investing Activities

We used cash of $156,483 in investing activities during the nine months ended September 30, 2022 compared to cash used of $14,462,531 in investing activities during the previous year’s nine-month period. The decrease was the result of the 2021 purchases of the television station assets that did not recur in 2022.

Net Cash Provided by Financing Activities

Net cash flows provided by financing activities of $1,452,000 for the nine months ended September 30, 2022 were from the proceeds of subordinated notes payable and Warrants that we sold to investors, compared to $20,830,000 of cash provided by financing activities during the previous fiscal year that we generated from the Arena financing in the amountFebruary 2021 and sales of $374,826 in ordersubscriptions to fundpurchase our Common Stock.

Form 10-Q – Q2Madison Technologies Inc.Page 34

Off-balance Sheet Arrangements

We have no off-balance sheet arrangements including arrangements that would affect its obligations as a reporting company under theSecurities Act of 1934liquidity, capital resources, market risk support and its general and administrative expenses for the next 12 months.credit risk support or other benefits.

Going Concern

Madison has not attained profitable operationsThe independent auditors’ reports accompanying our December 31, 2021 and is dependent upon obtaining financing to pursue any extensive business activities. For these reasons, Madison’s auditors stated in their report that they have2020 financial statements contain an explanatory paragraph expressing substantial doubt Madison will be ableabout our ability to continue as a going concern. The financial statements have been prepared assuming that we will continue as a going concern, which contemplates that we will realize our assets and satisfy our liabilities and commitments in the ordinary course of business.

Future Financings

Management anticipates continuing to rely on equity sales of Madison’s common stockour Common Stock in order to continue to fund itsour business operations. Issuances of additional common stockCommon Stock will result in dilution to Madison’sour existing stockholders. There is no assurance that Madisonwe will achieve any additional sales of its common stockour Common Stock or arrange for debt or other financing to fund itsour planned activities.

Off-balance Sheet Arrangements

Madison has no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on its financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to stockholders.

Form 10-Q – Q3Madison Technologies Inc.Page 19

Material Commitments for Capital Expenditures

AtWe had no contingencies or long-term commitments at September 30, 2017 Madison had an outstanding liability of $33,500 owing to Tuffy Packs LLC for the purchase of the Product Licensing agreement. As of the date of this filing Madison is in arrears $33,500 according to the Product Licensing Agreement. Please see Exhibit 10.5 Product License Agreement dated March 16, 2016 between Tuffy Packs, LLC and Madison Technologies Inc.2022.

Tabular Disclosure of Contractual Obligations

Madison isWe are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

Critical Accounting Policies

Madison’sWe follow certain significant accounting policies when preparing our consolidated financial statementsstatements. A complete summary of these policies is included in Note 1 of Notes to Consolidated Financial Statements. Certain of the policies require management to make significant and accompanying notessubjective estimates or assumptions that may deviate from actual results. In particular, management makes estimates regarding the useful life of long-lived assets related to depreciation and amortization expense, estimates regarding fair value of our reporting units and future cash flows with respect to assessing potential impairment of both long-lived assets and goodwill and estimates of expense related to our debt and equity instruments. Each of these estimates is discussed in greater detail in the following discussion.

Long-Lived Assets, Depreciation and Amortization Expense and Valuation

We review the carrying value of long-lived assets for impairment when events or changes in circumstances indicate that the carrying amount of an asset, or related asset group, may not be recoverable from estimated future undiscounted cash flows. Recoverability of assets to be held and used is measured by a comparison of the carrying amount of an asset or asset group to estimated undiscounted future cash flows expected to be generated by the asset or asset group. If the carrying amount of the asset exceeds its estimated future cash flows, an impairment charge is recognized by the amount by which the carrying amount of the asset exceeds the fair value of the asset. In 2021, we recognized that we would not complete the acquisition of the TV station assets of W27EB and KPHE TV and we wrote off $1,150,000 in deposits paid to sellers of those assets. In the nine months ended September 30, 2022, we wrote off an additional $52,668 in TV station assets.

Goodwill Valuation

Management performed the annual goodwill and indefinite-lived intangible assets impairment assessments as of December 31, 2021 and concluded that our goodwill for the Sovryn acquisition was impaired as of that date. Goodwill and indefinite lived assets are preparedtested annually or more frequently if events or changes in circumstances indicate that the asset might be impaired. We follow a two-step process for testing impairment. First, the fair value of each reporting unit is compared to its carrying value to determine whether an indication of impairment exists. If impairment is indicated, then the fair value of the reporting unit’s goodwill is determined by allocating the unit’s fair value of its assets and liabilities (including any unrecognized intangible assets) as if the reporting unit had been acquired in a business combination. The amount of impairment for goodwill is measured as the excess of its carrying value over its implied fair value.

Derivative Liabilities

We have certain financial instruments that are derivatives or contain embedded derivatives. We evaluate all of our financial instruments to determine if those contracts or any potential embedded components of those contracts qualify as derivatives to be separately accounted for in accordance with generally acceptedASC 810-10-05-4 and 815-40. This accounting principlestreatment requires that the carrying amount of any derivatives be recorded at fair value at issuance and marked-to-market at each balance sheet date. In the event that the fair value is recorded as a liability, as is the case with us, the change in the United States. Preparing financial statements requires managementfair value during the period is recorded as either other income or expense. Upon conversion, exercise or repayment, the respective derivative liability is marked to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue, and expenses. These estimates and assumptions are affected by management’s application of accounting policies. Management believes that understanding the basis and nature of the estimates and assumptions involved with the following aspects of Madison’s financial statements is critical to an understanding of Madison’s financial statements.

Use of Estimates

The preparation of financial statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilitiesfair value at the conversion, repayment or exercise date and then the related fair value amount is reclassified to other income or expense as part of the financial statements and the reported amounts of revenue and expenses in the reporting period. Madison regularly evaluates estimates and assumptions related to the recovery of long-lived assets, donated expenses and deferred income tax asset valuation allowances. Madison bases its estimates and assumptionsgain or loss on current facts, historical experience and various other factors that management believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by Madison may differ materially and adversely from Madison’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.extinguishment.

Form 10-Q – Q2Madison Technologies Inc.Page 35

ItemITEM 3. Quantitative and Qualitative Disclosures about Market Risk.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Madison isWe are a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

ItemITEM 4. Controls and Procedures.CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Management maintains “disclosureIn connection with the preparation of this annual report on Form 10-K, an evaluation was carried out by our management, with the participation of our Chief Executive Officer, who also serves as our Principal Financial and Accounting Officer, of the effectiveness of our disclosure controls and procedures” as such term is (as defined in RuleRules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934 (the “(“Exchange ActAct”), that as of December 31, 2021. Disclosure controls and procedures are designed to ensure that information required to be disclosed in Madison’sreports filed or submitted under the Exchange Act reports is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange CommissionSEC rules and forms and that such information is accumulated and communicated to management, including Madison’s President andthe Chief FinancialExecutive Officer, as appropriate, to allow timely decisions regarding required disclosure.disclosures.

In connection with the preparation of this quarterly reportBased on Form 10-Q, anthat evaluation, was carried out byour management with the participationconcluded, as of the President and the Chief Financial Officer,end of the effectiveness of Madison’speriod covered by this report, that our disclosure controls and procedures (as definedwere not effective in Rules 13a-15(e)recording, processing, summarizing, and 15d-15(e) underreporting information required to be disclosed, within the Exchange Act as of September 30, 2017.

Based ontime periods specified in the evaluationSEC rules and the identification of theforms and that such information was accumulated or communicated to management to allow timely decisions regarding required disclosure. In particular, we identified material weaknesses in Madison’s internal control over financial reporting, as describeddiscussed below.

Management’s Report on Internal Controls over Financial Reporting

Management is responsible for establishing and maintaining adequate internal control over financial reporting, as required by Sarbanes-Oxley (SOX) Section 404 A. Our internal control over financial reporting is a process designed under the supervision of our Chief Executive Officer to provide reasonable assurance regarding the reliability of financial reporting and the preparation of our financial statements for external purposes in accordance with U.S. generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures that:

pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;
provide reasonable assurance that transactions are recorded as necessary to permit preparation of the financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of management and the Board of Directors; and
provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of our assets that could have a material effect on the financial statements.

Because of its Form 10-K forinherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the year endedrisk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Form 10-Q – Q2Madison Technologies Inc.Page 36

Management conducted an assessment of the effectiveness of our internal control over financial reporting as of December 31, 2009,2021, based on criteria established in Internal Control –Integrated Framework issued by the PresidentCommittee of Sponsoring Organizations of the Treadway Commission (“COSO”). As a result of this assessment, management identified material weaknesses in internal control over financial reporting.

A material weakness is a control deficiency, or a combination of deficiencies, in internal control over financial reporting such that there is a reasonable possibility that a material misstatement of our annual or interim financial statements will not be prevented or detected on a timely basis. The matters involving internal controls and procedures that management considered to be material weaknesses under the standards of the Public Company Accounting Oversight Board were: (1) lack of a functioning audit committee and lack of a majority of outside directors on our board of directors, resulting in ineffective oversight in the establishment and monitoring of required internal controls and procedures; (2) inadequate segregation of duties consistent with control objectives; (3) insufficient written policies and procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (4) ineffective controls over period end financial disclosure and reporting processes. The aforementioned material weaknesses were identified and communicated to management in connection with the preparation and audit of our financial statements as of December 31, 2021 and the Chief Accounting Officerpreparation of our 2021 quarterly financial statements.

As a result of the material weakness in internal control over financial reporting described above, management has concluded that, as of September 30, 2017, Madison’s2022, our internal control over financial reporting was not effective based on the criteria in Internal Control – Integrated Framework issued by COSO.

Management believes that the material weaknesses set forth in items (2), (3) and (4) above did not have an effect on our financial results. However, management believes that the lack of a functioning audit committee and lack of a majority of outside directors on our board of directors caused and continues to cause an ineffective oversight in the establishment and monitoring of the required internal controls over financial reporting.

We are committed to improving its financial organization. As part of this commitment and when funds are available, we will create a position to segregate duties consistent with control objectives and will increase its personnel resources and technical accounting expertise within the accounting function by: (i) appointing one or more outside directors to its board of directors who will also be appointed to our audit committee, resulting in a fully functioning audit committee that will undertake the oversight in the establishment and monitoring of required internal controls over financial reporting; and (ii) preparing and implementing sufficient written policies and checklists that will set forth procedures for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure controlsrequirements.

Management believes that the appointment of one or more outside directors, who will also be appointed to a fully functioning audit committee, will remedy the lack of a functioning audit committee and a lack of a majority of outside directors on our Board. In addition, management believes that preparing and implementing sufficient written policies and checklists will remedy the following material weaknesses: (i) insufficient written policies and procedures were effective.for accounting and financial reporting with respect to the requirements and application of US GAAP and SEC disclosure requirements; and (ii) ineffective controls over period end financial close and reporting processes. Further, management believes that the hiring of additional personnel who have the technical expertise and knowledge will result proper segregation of duties and provide more checks and balances within the department. Additional personnel will also provide the cross training needed to support our internal controls if personnel turn-over issues within the department occur. This, coupled with the appointment of additional outside directors, is designed to greatly decrease any control and procedure issues we may encounter in the future.

Management will continue to monitor and evaluate the effectiveness of our internal controls over financial reporting on an ongoing basis and are committed to taking further action and implementing additional enhancements or improvements, as necessary and as funds allow.

Our independent auditors have not issued an attestation report on management’s assessment of our internal control over financial reporting. As a result, this quarterly report does not include an attestation report of our independent registered public accounting firm regarding internal control over financial reporting. We are not required to have, nor have we, engaged our independent registered public accounting firm to perform an audit of internal control over financial reporting pursuant to the temporary rules of the Securities and Exchange Commission that permit us to provide only management’s report in this quarterly report.

Changes in Internal Controls over Financial Reporting

There were no changes in Madison’sour internal controls over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the quarter ended September 30, 2017,2022, that materially affected, or are reasonably likely to materially affect, Madison’s internal control over financial reporting.

Limitations on the Effectiveness of Controls and Procedures

Management, including our President and Chief Financial Officer, does not expect that Madison’s controls and procedures will prevent all potential error and fraud. A control system, no matter how well conceived and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 2037

Part II – Other Information

ItemITEM 1. Legal Proceedings.LEGAL PROCEEDINGS.

Madison is not a party to any pending legal proceedings and, to the best of Madison’s knowledge, none of Madison’s property or assets are the subject of any pending legal proceedings.None.

ItemITEM 1A. Risk Factors.RISK FACTORS

Madison is a smaller reporting company as defined by Rule 12b-2 of the Exchange Act and is not required to provide the information required under this item.

ItemITEM 2. Unregistered Sales of Equity Securities and Use of Proceeds.UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During the quarter of the fiscal year covered by this report, (i) Madison did not modify the instruments defining the rights of its shareholders, (ii) no rights of any shareholders were limited or qualified by any other class of securities, and (iii) Madison did not sell any unregistered equity securities.securities, except as follows:

On March 1, 2022, we granted a Warrant to Mr. Zenna, our Director, to purchase up to 500,000 shares of our Common Stock at $0.025 per share.

In 2022, we sold a total of $1,632,500 of notes payable, some of which are convertible into our Common Stock at fixed prices, and we issued certain noteholders, Warrants to purchase an aggregate of 17,350,000 shares of our Common Stock, on a cashless exercise basis, at prices ranging from $0.02 to $0.10 per share.

ItemITEM 3. Defaults upon Senior Securities.DEFAULTS UPON SENIOR SECURITIES

DuringWe have not yet made the quarter$453,750 million interest payments on the senior secured Notes held by Arena Partners LP that were due on April 1, 2022, July 1, 2022 and October 1, 2022, and we are currently in discussions with Arena Capital LP on a plan of the fiscal year covered by thisforbearance.

ITEM 4. MINE SAFETY DISCLOSURES

No report no material default has occurred with respect to any indebtedness of Madison. In addition, during this quarter, no material arrearage in the payment of dividends has occurred.required.

Item 4. Mining Safety Disclosures.

There are no current mining activities at the date of this report.

ItemITEM 5. Other Information.OTHER INFORMATION

During the quarter of the fiscal year covered by thisNo report Madison reported all information that was required to be disclosed in a report on Form 8-K.required.

Madison has adopted a new code of ethics that applies to all its executive officers and employees, including its CEO and CFO. See Exhibit 14 – Code of Ethics for more information. Madison undertakes to provide any person with a copy of its financial code of ethics free of charge. Please contact Madison at 206-203-0474 to request a copy of Madison’s code of ethics. Management believes Madison’s code of ethics is reasonably designed to deter wrongdoing and promote honest and ethical conduct; provide full, fair, accurate, timely and understandable disclosure in public reports; comply with applicable laws; ensure prompt internal reporting of code violations; and provide accountability for adherence to the code.

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 2138

Item

ITEM 6. ExhibitsEXHIBITS

(a)Index to and Description of Exhibits

All Exhibits required to be filed with the Form 10-Q are included in this quarterly report or incorporated by reference to Madison’s previous filings with the SEC, which can be found in their entirety at the SEC website atwww.sec.gov under SEC File Number 000-51302.

ExhibitDescriptionStatus
3.13.3Articles of Incorporation, filed as an exhibit to Madison’s registration statement on Form 10-SB filed on May 4, 2005, and incorporated herein by reference.Filed
3.2By-Laws, filed as an exhibit to Madison’s registration statement on Form 10-SB filed on May 4, 2005, and incorporated herein by reference.Filed
3.3Certificate of Amendment dated March 9, 2015,filed as an Exhibit to Madison’s current report on Form 8-K filed March 11, 2015, and incorporated herein by referenceFiled
10.531.1Product License Agreement dated September 16, 2016 between Tuffy Packs, LLCCertification of Chief Executive Officer Pursuant to Rules 13a-14(a) and Madison Technologies Inc. filed15d-14(a) under the Securities Exchange Act of 1934, as an exhibit to Madison’s Form 8-K (Current Report) filed on September 19, 2016, and incorporated herein by referenceFiled
.
10.1Share Purchase Agreement dated September 26, 2016 between Thomas Brady and Steve Cozine filed as an exhibit to Madison’s Form 8K filed on October 3, 2016, and incorporated herein by reference.Filed
14Code of Ethics, filed as an exhibit to Madison’s 2010 annual report on Form 10-K filed on March 31, 2010, and incorporated herein by reference.Filed
31Certifications pursuantAdopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.Included
3231.2Certification pursuantof Chief Financial Officer Pursuant to Rules 13a-14(a) and 15d-14(a) under the Securities Exchange Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.Included
32.1Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuantAdopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.Included
32.2Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.Included

101.INSInline XBRL Instance Document
101.SCHInline XBRL Taxonomy Extension Schema Document
101.CALInline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEFInline XBRL Taxonomy Extension Definition Linkbase Document
101.LABInline XBRL Taxonomy Extension Label Linkbase Document
101.PREInline XBRL Taxonomy Extension Presentation Linkbase Document
104Cover Page Interactive Data File (embedded within the Inline XBRL document)

 
Form 10-Q – Q3Q2Madison Technologies Inc.Page 2239

Signatures

In accordance with the requirements of the Securities Exchange Act of 1934, Madison Technologies, Inc. has caused this report to be signed on its behalf by the undersigned duly authorized person.

Madison Technologies, Inc.
Dated:November 14, 20172022By:/s/ Thomas BradyPhilip Falcone
Name:Thomas BradyPhilip Falcone
Title:President
(Principal Executive Officer)