Madison Technologies Inc. - Quarter Report: 2020 September (Form 10-Q)

United states

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

For the quarterly period ended September 30, 2020

For the transition period from ________________________to _______________________

Commission file number 000-51302

Securities registered pursuant to Section 12(b) of the Act:

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.

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.

MADISON TECHNOLOGIES INC.

(UNAUDITED)

TABLE OF Contents

MADISON TECHNOLOGIES INC.

INTERIM Balance Sheets

(Unaudited)

Note 2 Going concern

Note 13 Subsequent events

See Accompanying Notes to the Interim Financial Statements.

MADISON TECHNOLOGIES INC.

INTERIM STATEMENTS of Operations

(Unaudited)

See Accompanying Notes to the Interim Financial Statements.

MADISON TECHNOLOGIES INC.

interim StatementS of stockholders’ DEFICIT

(Unaudited)

See Accompanying Notes to the Interim Financial Statements

MADISON TECHNOLOGIES INC.

interim StatementS of stockholders’ DEFICIT

(Unaudited)

See Accompanying Notes to the Interim Financial Statements.

MADISON TECHNOLOGIES INC.

interim StatementS of cash flows

(unaudited)

See Accompanying Notes to the Interim Financial Statements

MADISON TECHNOLOGIES INC.

NOTES TO THE INTERIM FINANCIAL STATEMENTS

(Unaudited)

September 30, 2020

Note 1 Interim Reporting

While the information presented in the accompanying interim nine 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 and methods of their application as the Company’s December 31, 2019 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 Company’s December 31, 2019 annual financial statements. Operating results for the nine months ended September 30, 2020 are not necessarily indicative of the results that can be expected for the year ended December 31, 2020.

Note 2 Nature and Continuance of Operations

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

Up until fiscal 2014, the Company was in the business of mineral exploration. 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.

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 sold ballistic panels which are personal body armors, that conform to the National Institute of Justice (NIJ) Level IIIA threat requirements. The Company’s plan of operations and sales strategy included online and social media marketing, as well as attending various tradeshows and conferences. As the Company failed to make specified payments as required, the agreement was amended to a non-exclusive basis.

Effective December 31, 2016, the Company dissolved its wholly owned subsidiary, Scout Resources Inc. (“Scout”) and assumed all the debt that Scout owed.

On July 17, 2020, the Company entered into an agreement to acquire the Casa Zeta-Jones Brand License Agreement from Luxurie Legs, LLC of Delaware. Luxurie Legs transferred all of its rights, title and interest in the License Agreement to the Company in exchange for the Company’s newly issued preferred convertible Series A stock. Upon conversion, the stock could control up to 95% of the outstanding common shares. The agreement also required voting control, represented by newly issued shares of preferred Series B stock, to be issued to an independent person, not affiliated with either the Company or Luxurie Legs.

On September 25, 2020, the Company entered into a share exchange agreement to acquire 51% of the common shares of Posto Del Sole Inc., a leading jewelry designer, to further develop the Company’s existing brands and create new designer labels. Posto Del Sole currently offers four jewelry collections covering multiple designs in diamonds, gold and silver, fashion, vintage, bridal and room to expand into areas such as Bespoke, diamond basics and watches. At September 30, 2020, the share exchange had not closed.

These financial statements have been prepared in accordance with generally accepted accounting principles applicable to a going concern, which assumes that 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 classification of assets and liabilities should the Company be unable to continue as a going concern. At September 30, 2020, the Company had not yet achieved profitable operations, had accumulated losses of $758,182 since its inception and expects to incur further losses in the development of its business, all of which casts substantial doubt about the Company’s ability to continue as a going concern. The Company’s ability to continue as a going concern is dependent upon its ability to generate future profitable operations and/or 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.

Note 3 Summary of Significant Accounting Policies

There have been no changes in the accounting policies from those disclosed in the notes to the audited financial statements for the year ended December 31, 2019.

Note 4 Recent Accounting Pronouncements

The Company adopts new pronouncements relating to generally accepted accounting principles applicable to the Company as they are issued, which may be in advance of their effective date. Management does not believe that any pronouncement not yet effective but recently issued would, if adopted, have a material effect on the accompanying financial statements.

Note 5 Intangible assets

Intangible assets are amortized on a straight-line basis over the term of the Casa Zeta-Jones license, which is 3.5 years.

Note 6 License Agreements

At December 31, 2018, the Company had paid $16,500 to the Licensor, leaving an unpaid balance of $33,500. To date, the Company has recorded a total license amortization of $50,000.

As a result of the failure to make payments as required under the agreement, the Company was informed on March 20, 2017, that going forward, the agreement would be on a non-exclusive basis.

The values were based on the licensor obtaining 95% of the Company’s common shares, whose value was discounted by a 50% factor, given the lightly traded history in its shares.

The Company is subject to the following terms:

Note 7 Share Exchange Agreement

The Company entered into a Share Exchange Agreement on September 25, 2020 with Posto Del Sole Inc. a New York corporation, to acquire 51% of the shares Posto Del Sole Inc. and in return, the Company will issue 10,000 Preferred Series C shares. (See Note 13). As part of the agreement, the Company is to provide monthly investments to a total aggregate of $1,000,000 during the twelve month period following the closing. Posto Del Sole Inc. has 60 days from closing to provide the necessary financial statements and notes as required to satisfy regulatory requirements and disclosures. The Share Exchange closed subsequent to September 30, 2020.

Note 8 Note Payable

The Company has one note payable that is accruing interest at 5% per annum. The note is unsecured and matures on June 30, 2021.

Note 9 Convertible Notes and Accrued Interest Payable

A summary of the convertible notes and accrued interest payable is as follow:

All notes are unsecured and, except where specifically noted, are due on demand. Except for notes denoted below under (e), all accrued interest occurred in the nine months ended September 30, 2020. As at April 2, 2020, all the convertible notes payable have been amended to include that no such conversion shall result in the Holder holding in excess of 9.99% of the total issued and outstanding common stock of the Company at any time. The effect that conversion would have on earnings per share has not been disclosed due to the anti-dilutive effect

Note 10 Related Party

As at September 30, 2020, the President and CEO of the Company is owed $300 for out of pocket expenditures and incurred $10,000 in management fees.

On September 28, 2020, the Company entered into a renewable employment agreement with the President and CEO of the Company. The term is for one year with a base salary of $8,000 per month. Such base salary may be increased by an amount no less than 5% on each anniversary date plus any additional amount as determined by the Company’s board of directors.

The President and CEO of the Company currently holds 10,000 Series B Preferred Super Voting shares which he is entitled to 51% voting rights no matter how many shares of common stock or other voting stock of the Company are issued or outstanding in the future, such that he shall always have majority voting control of the Company.

Note 11 Common Stock

The following common stock transactions occurred during the nine-month ended September 30, 2020:

On July 23, 2020, the Company issued 1,785,000 shares of common stock pursuant to a notice of conversion of a note payable of $16,900 at $0.01 per share plus legal fees of $950, totaling $17,850.

Subsequent to the period end of September 30, 2020, the Company had the following common stock transactions:

On October 27, 2020, the Company issued 1,900,000 shares of common stock pursuant to a notice of partial conversion of a note payable of $9,500 at $0.005 per share.

On October 19, 2020, the Company issued 1,730,000 shares of common stock pursuant to a notice of partial conversion of a note payable of $17,300 at $0.01 per share.

The following common stock transactions occurred in the year ended December 31, 2019:

On March 25, 2019, the Company completed a private placement of 600,000 shares of common stock at a per share price of $0.05 for gross proceeds of $30,000. This was issued during the period ended December 31, 2019.

On February 14, 2019, the Company completed a private placement of 400,000 shares of common stock at a per share price of $0.05 for gross proceeds of $20,000. This was issued during the period ended December 31, 2019.

There are no shares subject to warrants or options as of September 30, 2020.

Note 12 Preferred Shares

Series A 3% Convertible Preferred Stock, par value $0.001 with a stated valued of $100 per share

There are 100,000 designated and authorized Series A 3% convertible preferred stock with a 9.99% conversion cap and anti-dilution rights for 24 months from time of issuance. Holders of Series A 3% Preferred Stock shall be entitled to receive, when and as declared, dividends equal to 3% per annum on the stated value, payable in additional shares of Series A Preferred Stock. Holders of Series A 3% Convertible Preferred Stock have the right to vote on any matter that may be submitted to the Company’s shareholders for vote, on an as converted basis, either by written consent or by proxy. Each share of Series A 3% Convertible Preferred Stock may be convertible into 3420 shares of Common Stock, or as adjusted to equal the conversion ratio multiplied by a fraction, the numerator of which shall be the number of shares outstanding on a fully diluted basis after the issuance of the dilution shares, and the denominator shall be 360,000,000. (See Form 8K filing on August 6, 2020, Exhibit 10.3)

Pursuant to the License Agreement on July 17, 2020, 92,999 Series A 3% Convertible Preferred Stock were issued. The Series A 3% Convertible Preferred Stock was valued at $168,116 which equates to 49% of $343,094 (the valuation calculated for the acquisition cost of the Casa Zeta-Jones Brands License Agreement). The acquisition cost was derived using the current market price of $0.04 x 95% of the number of the issued and outstanding shares of the Company at the time (18,057,565) x 50% of the value. (See Note 6).

Series B Super Voting Preferred Stock, par value $0.001

There are 10,000 designated and authorized Series B Super Voting Preferred Stock. Holders with Series B Super Voting Preferred Stock have the right to vote on all shareholder matters equal to 51% of the total vote of common stockholders. The Series B Super Voting Preferred Stock holder is entitled to 51% voting rights no matter how many shares of common stock or other voting stock of the Company are issued or outstanding in the future, such that the holder of Series B Super Voting Preferred Stock shall always have majority control of the Company. (See Form 8K filing on August 6, 2020, Exhibit 10.3)

Pursuant to the License Agreement on July 17, 2020, 10,000 Series B Super Voting Preferred Stock were issued. The Series B Super Voting Preferred Stock was valued at $174,978 which equates to 51% of $343,094 (the valuation calculated for the acquisition cost of the Casa Zeta-Jones Brands License Agreement) as Series B Super Voting Preferred Stock is entitled to 51% voting rights no matter how many shares of common stock or other voting stock of the Company are issued or outstanding and shall always have the majority control of the Company. (See Note 6)

Series C 2% Convertible Preferred Stock, par value $0.001 with a stated value of $100 per share

There are 10,000 designated and authorized Series C 2% convertible preferred stock with a 9.99% conversion cap. Holders of Series C 2% Preferred Stock shall be entitled to receive, when and as declared, dividends equal to 2% per annum on the stated value, payable in additional shares of Series C Preferred Stock. So long as any shares of Series C Preferred Stock remain outstanding, neither the Company nor any subsidiary thereof shall, without the consent of the Holders of 80% of the shares of Series C Preferred Stock then outstanding, redeem, repurchase or otherwise acquire directly or indirectly any Junior Securities nor shall the Company directly or indirectly pay or declare or make any distribution upon, nor shall any distribution be made in respect of, any Junior Securities, nor shall any monies be set aside for or applied to the purchase or redemption of any Junior Securities. Each holder of the Series C Preferred Stock shall have the right to vote on any matter that may from time to time be submitted to the Company’s shareholders for a vote, on an as converted basis, either by written consent or by proxy. Each share of Series C 2% Convertible Preferred Stock may be convertible into 100 shares of Common Stock.

As at September 30, 2020, no Series C Convertible Preferred shares were issued.

Note 13 Subsequent Events

During October 2020, the Company entered into three convertible note payables totaling $160,000, convertible at $0.05 with a rate of 10% per annum that matures on October 31, 2021.

On October 16, 2020, the Company paid the balance of $50,000 towards the advance royalty pursuant to the License Agreement.

On October 19, 2020, the Company issued 1,730,000 shares of common stock pursuant to a notice of partial conversion of a note payable of $17,300 at $0.01 per share.

On October 27, 2020, the Company issued 1,900,000 shares of common stock pursuant to a notice of partial conversion of a note payable of $9,500 at $0.005 per share.

On October 29, 2020, the Company advanced $85,000 towards the investment in Posto Del Sole Inc.

ITEM 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATION.

The following discussion of Madison Technologies Inc’s financial condition, changes in financial condition and results of operations for the nine months ended September 30, 2020 should be read in conjunction with Madison’s unaudited consolidated financial statements and related notes for the nine months ended September 30, 2020.

Forward Looking Statements

This quarterly report on Form 10-Q contains forward-looking statements within 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 meaning of the Private Securities Litigation Reform Act of 1995. Given these uncertainties, readers are cautioned not to place undue reliance on such forward-looking statements.

GENERAL

Madison Technologies Inc. (the “Company”) 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, the Company changed its name to “Madison Technologies Inc.,” by a majority vote of the shareholders. See Exhibit 3.3 – Certificate of Amendment for more details.

The company maintains its statutory resident agent’s office at 1859 Whitney Mesa Drive, Henderson, Nevada, 89014 and its business office is located 240 Vaughan Drive, Alpharetta, Georgia 30009. The company’s office telephone number is (206)-203-0474.

The company is authorized to issue up to 500,000,000 shares of Common Stock with a par value of $0.001 per share, of which 23,472,565 shares of Common Stock are currently issued and outstanding as at November 23, 2020.

The company has not been involved in any bankruptcy, receivership or similar proceedings. There have been no material reclassifications, merger consolidations or purchase or sale of a significant amount of assets not in the ordinary course of the company’s business, except those disclosed below;

On July 17, 2020, Madison Technologies, Inc. (the “Company”) officially ratified an Acquisition Agreement in order to acquire the Casa Zeta-Jones Brand License Agreement (the “License Agreement”) from Luxurie Legs, LLC, a limited liability company organized pursuant to the laws of the State of Delaware (“LUXURIE”), pursuant to which, at the effective time, LUXURIE will transfer all of its right, title and interest in the License Agreement to the Company in exchange for a controlling interest in the Company represented by newly issued preferred stock. The Company will also assume $65,000 in existing debt owed by LUXURIE, among other conditions, in exchange for a controlling interest in the Company represented by newly issued preferred stock. Please see item 1.01 of the form 8-K filed on July 20, 2020 for information relating to the License Agreement.

Effective July 14, 2020, the Board of Directors of Madison Technologies, Inc. (the “Company”) approved the creation and issuance of 100,000 shares of Series A Convertible Preferred Stock and 100 shares of Series B Super Voting Preferred Stock pursuant to the conditions precedent to closing the Acquisition Agreement with Luxurie Legs, LLC ratified on July 17, 2020, under which the Company acquired the Casa Zeta-Jones Brand License Agreement (the “License Agreement”) from Luxurie Legs, LLC (“Luxurie”). Please see item 3.02 of the form 8-K filed on August 7, 2020 for information relating to the Unregistered Sales of Equity Securities.

On July 28, 2020, the Company filed a Certificate of Amendment to its Articles of Incorporation and Certificates of Designation establishing the designations, preferences, limitations and relative rights of the Company’s Series A Convertible Preferred Stock and Series B Super Voting Preferred Stock in the State of Nevada. Please see item 5.03 of the form 8-K filed on August 7, 2020 for information relating to the Amendment to Articles of Incorporation or Bylaws.

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.

Nine months ended September 30, 2020 and September 30, 2019

Our net loss for the nine-month period ended September 30, 2020 was $183,903 (2019: $27,638), which consisted of general and administration expenses, management fees, royalties and amortization. We generated $1,164 in revenue during nine-month period in fiscal 2020 compared to $3,049 during the nine-month period in 2019. The increase in expenses in the current fiscal year relate to an increase in both general and administrative expense and management fees related to our online store operations and the amortization of our Casa Zeta-Jones Brand License Agreement obligations.

The weighted average number of shares outstanding was 18,507,072 for the nine-month period ended September 30, 2020 and 17,119,470 for the nine-month period ended September 30, 2019.

Liquidity and Capital Resources

Cash and Working Capital

As at September 30, 2020, Madison had cash of $6,357 and a working capital deficit of $71,336, compared to cash of $1,366 and working capital deficit of $358,377 as at December 31, 2019.

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 $197,362 in operating activities during the first nine months of fiscal 2020 compared to cash used of $47,267 in operating activities during the same period in the previous fiscal year.

Net Cash Provided (Used in) Investing Activities

Net cash used in investing activities was $6,647 for the first nine months of fiscal 2020 and nil during the same period in fiscal 2019.

Net Cash Provided by Financing Activities

Net cash flows provided by financing activities of $209,000 for the first nine months of fiscal 2020, were from the proceeds of a convertible note payable. Madison generated $50,000 from share subscriptions during the first nine months of fiscal 2019.

Plan of Operation

Casa Zeta-Jones Brand License Agreement from Luxurie Legs, LLC

Our plan of operation is to deliver the Casa Zeta-Jones brand licensed products into the international markets via to be determined marketing and fulfillment services. The Casa Zeta-Jones brand licensed product line will include razors with a custom designed handle and cartridge system, pre-care products, exclusive shaving products and some of the best after care products on the market today.

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.

Going Concern

Madison has not attained profitable operations and is dependent upon obtaining financing to pursue any extensive business activities. For these reasons, Madison’s auditors stated in their report that they have substantial doubt Madison will be able to continue as a going concern.

Future Financings

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

Material Commitments for Capital Expenditures

At September 30, 2020 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.

Tabular Disclosure of Contractual Obligations

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.

Critical Accounting Policies

Madison’s financial statements and accompanying notes are prepared in accordance with generally accepted accounting principles in the United States. Preparing financial statements requires management 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 liabilities at the date 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 assumptions 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.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

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.

ITEM 4. CONTROLS AND PROCEDURES.

Evaluation of Disclosure Controls and Procedures

Management maintains “disclosure controls and procedures,” as such term is defined in Rule 13a-15(e) under the Securities Exchange Act of 1934 (the “Exchange Act”), that are designed to ensure that information required to be disclosed in Madison’s Exchange Act reports is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission rules and forms, and that such information is accumulated and communicated to management, including Madison’s President and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.

In connection with the preparation of this quarterly report on Form 10-Q, an evaluation was carried out by management, with the participation of the President and the Chief Financial Officer, of the effectiveness of Madison’s disclosure controls and procedures (as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act as of September 30, 2020.

Based on the evaluation and the identification of the material weaknesses in Madison’s internal control over financial reporting, as described in its Form 10-K for the year ended December 31, 2009, the President and the Chief Accounting Officer concluded that, as of September 30, 2020, Madison’s disclosure controls and procedures were effective.

Changes in Internal Controls over Financial Reporting

There were no changes in Madison’s internal controls over financial reporting (as defined in Rule 13a-15(f) of the Exchange Act) during the quarter ended September 30, 2020, 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.

Part II – Other Information

ITEM 1. 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.

ITEM 1A. 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.

ITEM 2. 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.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES

No report required.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No report required.

ITEM 5. OTHER INFORMATION

No report required.

ITEM 6. 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 at www.sec.gov under SEC File Number 000-51302.

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.