ITEM
14. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section
78.7502(1) of the Nevada Revised Statutes provides that a corporation may indemnify any person who was or is a party, or is threatened
to be made a party, to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative
(except in an action brought by or on behalf of the corporation) if that person is or was a director, officer, employee or agent of the
corporation, or is or was serving at the request of the corporation as a director, officer, employee or agent of another corporation
or enterprise, against expenses, including attorneys’ fees, judgments, fines and amounts paid in settlement actually and reasonably
incurred by that person in connection with such action, suit or proceeding, if that person acted in good faith and in a manner which
that person reasonably believed to be in, or not opposed to, the best interests of the corporation, and, with respect to any criminal
action or proceedings, had no reasonable cause to believe his conduct was unlawful. The termination of any action, suit or proceeding
by judgment, order, settlement, conviction or upon a plea of nolo contendere or its equivalent, alone, does not create a presumption
that the person did not act in good faith and in a manner which the person reasonably believed to be in, or not opposed to, the best
interests of the corporation, and that, with respect to any criminal action or proceeding, the person had reasonable cause to believe
his action was unlawful.
Section
78.7502(2) of the Nevada Revised Statutes provides that a corporation may indemnify any person who was or is a party or is threatened
to be made a party to any threatened, pending or completed action or suit brought by or on behalf of the corporation to procure a judgment
in its favor because the person acted in any of the capacities set forth above, against expenses, including amounts paid in settlement
and attorneys’ fees, actually and reasonably incurred by that person in connection with the defense or settlement of such action
or suit, if the person acted in accordance with the standard set forth above, except that no indemnification may be made in respect of
any claim, issue or matter as to which such person shall have been adjudged by a court of competent jurisdiction after exhaustion of
all appeals therefrom to be liable to the corporation or for amounts paid in settlement to the corporation unless and only to the extent
that the court in which such action or suit was brought or other court of competent jurisdiction determines that, in view of all the
circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses as the court deems proper.
Section
78.7502(3) of the Nevada Revised Statutes further provides that, to the extent a director or officer of a corporation has been successful
on the merits or otherwise in the defense of any action, suit or proceeding referred to in subsections 1 and 2 thereof, or in the defense
of any claim, issue or matter therein, that person shall be indemnified by the corporation against expenses (including attorneys’
fees) actually and reasonably incurred by that person in connection therewith.
Section
78.751 of the Nevada Revised Statutes provides that unless indemnification is ordered by a court, the determination to provide indemnification
must be made by the stockholders, by a majority vote of a quorum of the board of directors who were not parties to the action, suit or
proceeding, or in specified circumstances by independent legal counsel in a written opinion. In addition, the articles of incorporation,
bylaws or an agreement made by the corporation may provide for the payment of the expenses of a director or officer of the expenses of
defending an action as incurred upon receipt of an undertaking to repay the amount if it is ultimately determined by a court of competent
jurisdiction that the person is not entitled to indemnification. Section 78.751 of the Nevada Revised Statutes further provides that
the indemnification provided for therein shall not be deemed exclusive of any other rights to which the indemnified party may be entitled
and that the scope of indemnification shall continue as to directors, officers, employees or agents who have ceased to hold such positions,
and to their heirs, executors and administrators.
Section
78.752 of the Nevada Revised Statutes provides that a corporation may purchase and maintain insurance on behalf of a director, officer,
employee or agent of the corporation against any liability asserted against him or incurred by him in any such capacity or arising out
of his status as such whether or not the corporation would have the authority to indemnify him against such liabilities and expenses.
Our
Articles of Incorporation and Bylaws provide that the Company shall, to the fullest extent permitted by the provisions of the Nevada
Revised Statutes, indemnify any and all persons whom it shall have the power to indemnify under the Nevada Revised Statutes.
We
expect to obtain general liability insurance that covers certain liabilities of our directors and officers arising out of claims based
on acts or omissions in their capacities as directors or officers, including liabilities under the Securities Act. Insofar as indemnification
for liabilities arising under the Securities Act may be permitted to directors, officers or persons controlling the registrant pursuant
to the foregoing provisions, we have been informed that in the opinion of the SEC such indemnification is against public policy as expressed
in the Securities Act and is therefore unenforceable.
The
above provisions may discourage stockholders from bringing a lawsuit against our directors for breach of their fiduciary duty. The provisions
may also have the effect of reducing the likelihood of derivative litigation against directors and officers, even though such an action,
if successful, might otherwise benefit us and our stockholders. Furthermore, a stockholder’s investment may be adversely affected
to the extent we pay the costs of settlement and damage awards against directors and officers pursuant to these indemnification provisions.
We believe that these certificate of incorporation provisions, bylaw provisions, indemnification agreements and the insurance are necessary
to attract and retain qualified persons as directors and officers.
ITEM
15. RECENT SALES OF UNREGISTERED SECURITIES
The
Company made the following issuances of its unregistered securities during the last three years pursuant exemptions contained
in Section 4(a)(2) or 3(a)(9) of the Securities Act and/or Rule 506 of Regulation D promulgated thereunder:
On
January 25, 2018, two convertible notes were converted into shares. One note for $25,000 was converted into 2,500,000 shares at $0.01
per share and the other note for $10,000 was converted into 2,000,000 shares at $0.005 per share.
On
February 16, 2018, the Company completed a private placement of 150,000 shares of common stock at a per share price of $0.10 for gross
proceeds of $15,000.
On
March 2, 2018, the Company completed a private placement of 150,000 shares of common stock at a per share price of $0.10 for gross proceeds
of $15,000.
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.
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.
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”).
On
July 23, 2020, the Company issued 1,785,000 shares of common stock pursuant to the conversion of a note payable of $16,900 at $0.01 per
share plus legal fees of $950, totaling $17,850.
On
October 28, 2020, the Company issued 1,900,000 shares of common stock pursuant to the conversion of a note payable of $9,500 at $0.005
per share.
On
November 2, 2020, the Company issued 1,730,000 shares of common stock pursuant the conversion of a note payable of $17,300 at $0.01 per
share.
On
February 17, 2021, the Company issued an aggregate of 230,000 shares of Series D preferred stock in exchange for all outstanding shares
of series A preferred stock and convertible debt outstanding.
On
February 17, 2021, the Company issued to the shareholders of Sovryn Holdings, Inc. an aggregate of 1,000 shares of series E preferred
stock in exchange for all outstanding shares of Transworld Enterprises, Inc.
On
February 17, 2021, the Company issued convertible notes with an aggregate principal amount of $16,500,000, warrants to purchase an aggregate
of 192,073,017 shares of common stock and 1,000 series G preferred stock for aggregate gross proceeds of $15,000,000.
On
the September 16, 2021, the Company entered into an exchange agreement (collectively, the “Exchange Agreement”) with the
holders of Series E preferred stock pursuant to which the holders agreed to exchange all of the shares of Series E preferred stock for
an aggregate of 1,152,500 shares of convertible Series E-1 preferred stcok and an aggregate of 1,091,388,889 shares of common stock.
During
the three months ended June 30, 2021, the Company entered into subscription agreements for the sale of an aggregate of 4,173 shares of
Series G convertible preferred stock for aggregate gross proceeds of $4,173,000.
ITEM
17. UNDERTAKINGS
The
undersigned registrant hereby undertakes:
1.
To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:
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(i)
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To
include any prospectus required by Section 10(a)(3) of the Securities Act;
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(ii)
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To
reflect in the prospectus any facts or events arising after the effective date of this registration statement (or most recent post-effective
amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration
statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of
securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum
offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) (Section 230.424(b) of
this chapter) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering
price set forth in the “Calculation of Registration Fee” table in the effective registration statement; and
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(iii)
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To
include any material information with respect to the plan of distribution not previously disclosed in the registration statement
or any material change to such information in the registration statement.
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Provided,
however, that:
2.
That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be
a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
3.
To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the
termination of the offering.
Insofar
as indemnification for liabilities arising under the Securities Act may be permitted to our directors, officers and controlling persons
pursuant to the provisions above, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act, and is, therefore, unenforceable. In the event that a claim
for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer
or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer
or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the
matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.