UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


Washington,
D.C. 20549





FORM
10-K/A





(Mark
One)


x
            ANNUAL
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the
fiscal year ended:December 31,
2008





r
            TRANSITION
      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF
      1934





For the
transition period from ________________ to ________________





Commission
File Number:0-24721




LEXON TECHNOLOGIES,
INC.


(Exact
name of registrant as specified in charter)


Delaware
                87-0502701(State
      or other jurisdiction of incorporation or organization)
                (I.R.S.
      Employer I.D. No.)8
      Corporate Park,Suite300,Irvine,California
                92606(Address
      of principal executive offices)
                (Zip
      Code)





Issuer's
telephone number, including area code:(949)
752-7700





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


Title
      of each class
            Name
      of each exchange on which registeredNone
            N/A





Securities
registered pursuant to section 12(g) of the Act:





Common Stock, par value $0.001 per
share


(Title of
class)





Check
whether the issuer is not required to file reports pursuant to Section 13 or
15(d) of the Exchange Act. r





Check
whether the issuer (1) filed all reports required to be filed by section 13 or
15(d) of the Exchange Act 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. (1) Yes ý   No r (2) Yes ý  No r





Check if
there is no disclosure of delinquent filers in response to Item 405 of
Regulation S-B is not contained in this form, and no disclosure will be
contained, to the best of registrant's knowledge, in definitive proxy or
information statements incorporated by reference in Part III of this Form 10-K
or any amendment to this Form 10-K.r




Indicate
by check mark whether the registrant is a large accelerated filer, an
accelerated filer, or a non-accelerated filer (as defined in Rule 12b-2 of
the Act).  See the definitions of “large accelerated filer,” “accelerated
filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.
(Check one):
  Large
      accelerated filer o
              Accelerated
      filer o
              Non-accelerated
      filer o
              Smaller
      reporting company x





Indicate
by check mark whether the registrant is a shell company (as defined in Rule
12b-2 of the Exchange Act). Yes ý   No
o





State
issuer's revenues for its most recent fiscal year:$0.





State the
aggregate market value of the voting and non-voting common equity held by
non-affiliates computed by reference to the price at which the stock was sold,
or the average bid and asked prices of such common equity, as of a specified
date within the past 60 days.





As of May
4, 2009, Lexon had 34,183,778 shares of common stock outstanding. Based on the
average bid and asked prices of the common stock at May 4, 2009, of $0.006 per
share, the market value of shares held by non-affiliates would be $99,742.61,
based on 16,623,768 shares. Lexon’s stock is traded on the over-the-counter
bulletin board system under the symbol “LEXO” however trades are thin and
sporadic. Therefore, the bid and ask price may not be indicative of any actual
value in the stock.





DOCUMENTS
INCORPORATED BY REFERENCE





List
hereunder the following documents if incorporated by reference and the part of
the form 10-K (e.g., part I, part II, etc.) into which the document is
incorporated: (1) Any annual report to security holders; (2) Any proxy or other
information statement; and (3) Any prospectus filed pursuant to rule 424(b) or
(c) under the Securities Act of 1933: None.
















TABLE OFCONTENTS




PART
    I.ITEM
      1.
                              DESCRIPTION OF
      BUSINESS
                              1ITEM
      2.
                              DESCRIPTION OF
      PROPERTIES
                              2ITEM
      3.
                              LEGAL
      PROCEEDINGS
                              2ITEM
      4.
                              SUBMISSION OF MATTERS TO A VOTE
      OF SECURITIES HOLDERS
                              3PART
    II.ITEM
      5.
                              MARKET FOR COMMON EQUITY AND
      RELATED STOCKHOLDER MATTERS
                              3ITEM
      6.
                              SELECTED
      FINANCIAL STATEMENT DATA
                              3ITEM
      7.
                              MANAGEMENT'S DISCUSSION AND
      ANALYSIS OR PLAN OF OPERATION
                              4ITEM
      8.
                              FINANCIAL
      STATEMENTS
                              5ITEM
      9.
                              CHANGES IN AND DISAGREEMENTS WITH
      ACCOUNTANTS ON
                              5ITEM
      9A.
                              CONTROLS AND
      PROCEDURES
                              5ITEM
      9B.
                              OTHER
      INFORMATION
                              7PART
      III.ITEM
      10.
                              DIRECTORS
      AND EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL
                              6ITEM
      11.
                              EXECUTIVE
      COMPENSATION
                              7ITEM
      12.
                              SECURITY OWNERSHIP OF CERTAIN
      BENEFICIAL OWNERS AND MANAGEMENT
                              8ITEM
      13.
                              CERTAIN RELATIONSHIPS AND RELATED
      TRANSACTIONS
                              10ITEM
      14.
                              PRINCIPAL ACCOUNTANT FEES AND
      SERVICES
                              10PART
      IV
                              EXHIBITS
      AND FINANCIAL STATEMENTS











PART
I.





ITEM
1.                      DESCRIPTION
OF BUSINESS





Business
Development





Lexon was
incorporated under the laws of the State of Delaware on April 20, 1989 under the
name of California Cola Distributing Company, Inc. The name was later changed to
Rexford, Inc. on October 1, 1992. Effective July 21, 1999, the name of the
Company was changed from Rexford, Inc. to Lexon Technologies, Inc.





In May
2002, Lexon acquired all of the issued and outstanding stock of Phacon
Corporation, a privately-held California corporation pursuant to a Merger
Agreement. In connection with the acquisition, a majority of the Registrant's
shareholders approved a proposal to effect a 10-for-1 reverse split of the
outstanding securities, and appointed new directors nominated by Phacon. Lexon
issued 17,500,000 shares of its post-reverse common stock in exchange for a like
number of shares of Phacon plus the cancellation of an outstanding loan from
Phacon for $200,000 plus accrued interest.





Following
the merger, Lexon intended to engage in the business of commercializing a
proprietary device and proprietary software package that reduces the amount of
electricity required to power various indoor lighting devices in commercial
buildings, factories, and office structures, as well as outdoor street and
parking lot lighting. However, market conditions and competition in the
area of electrical devices has caused the company to consider alternative
business strategies and to actively seek potential business acquisitions or
opportunities to enter in an effort to commence business operations outside the
electrical products area.





In
December 2004, Lexon acquired majority control (90.16%) of Techone Company,
Ltd., a Republic of Korea corporation (“Techone”), through an investment of
$1 ,588 ,000. During February 2006, the Company changed the name of Techone
to Lexon Semiconductor Corporation (“Lexon Semi”). Lexon Semi is a corporation
that manufactures and sells Low Temperature Cofired Ceramic (LTCC) components.
The Company has operated Lexon Semi as a majority-owned subsidiary and the
business of Lexon Semi has been the operating business of the
Company.





Most of
Lexon Semi's assets, however, were seized and sold at auction effective August
19, 2005 for $3,162,000 to satisfy certain secured creditors. Management
negotiated a lease arrangement with the acquirer to allow the Company to
continue operations and use the Lexon Semi facilities. The new landlord agreed
to lease the building, land, and equipment to the Company for 20 million South
Korean Won per month (approximately $18,000 U.S. dollars per month). However,
during July 2006, the operations of Lexon Semi were suspended due to lack of
funds. The Company presently does not have any business operations and is
seeking other business opportunities and/or potential merger
candidates.





Business of
Issuer





Lexon
does not propose to restrict its search for a business opportunity to any
particular industry or geographical area and may, therefore, engage in
essentially any business in any industry. Lexon's board of directors has
unrestricted discretion in seeking and participating in a business
opportunity, subject to the availability of such opportunities, economic
conditions, and other factors. Management of the Company, which in all
likelihood will not be experienced in matters relating to the business of a
target business, will rely upon its own efforts in accomplishing the business
purposes of the Company.





The
analysis of new business opportunities will be undertaken by, or under the
supervision of an officer or director of the Company, who is not a professional
business analyst. In analyzing prospective business opportunities, management
may consider such matters as available technical, financial and managerial
resources; working capital and other financial requirements; history of
operations, if any; prospects for the future; nature of present and expected
competition; the quality and experience of management services which may be
available and the depth of that management; the potential for further research,
development, or exploration; specific risk factors not now foreseeable but which
then may be anticipated to impact the proposed activities of the Company; the
potential for growth or expansion; the potential for profit; the perceived
public recognition or acceptance of products, services, or trades; name
identification; and other relevant factors.





The
selection of a business opportunity in which to participate is complex and
risky. Moreover, as Lexon has only limited resources, it may be difficult to
find good opportunities. There can be no assurance that the Lexon board of
directors will be able to identify and acquire any business opportunity which
will ultimately prove to be beneficial to Lexon and its shareholders. The board
of directors will select any potential business opportunity based on the
directors' and management's business judgment.





1




In
implementing a structure for a particular business acquisition, the Company may
become a party to a merger, consolidation, reorganization, joint venture, or
licensing agreement with another corporation or entity. It may also acquire
stock or assets of an existing business. On the consummation of a transaction,
it is likely that the present management and stockholders of the Company will no
longer be in control of the Company. In addition, it is likely that the
Company's officers and directors will, as part of the terms of the acquisition
transaction, resign and be replaced by one or more new officers and
directors.





The
activities of the Company are subject to several significant risks which arise
primarily as a result of the fact that Lexon has no specific business at this
time and may acquire or participate in a business opportunity based on the
decision of the board of directors which potentially could act without the
consent, vote, or approval of Lexon's shareholders. The risks faced by
Lexon are further increased as a result of its lack of resources and its
inability to provide a prospective business opportunity with significant
capital.





Management
intends to hold expenses to a minimum and to obtain outside services on a
contingency basis when possible. However, if Lexon engages outside advisors or
consultants to assist with the evaluation of a potential business opportunity,
it may be necessary to raise additional funds. At this time, Lexon has not made
any arrangements or definitive agreements to use outside advisors or consultants
or to raise any capital.





Employees




As of the
date hereof, we have two full-time employees. The Company believes that its
relation with its employees is good.





ITEM
2.                      DESCRIPTION
OF PROPERTIES




Facilities





Lexon
leases office space at 8 Corporate Park, Suite 300, Irvine,
California 92606. The lease is month to month at a rate of $800 per month.
Lexon does not anticipate requiring any additional space in the next six to
twelve months.




ITEM
3.                      LEGAL
PROCEEDINGS





To the
best knowledge of management, there are two pending legal proceedings against
us.





On July
14, 2008, Advanced Digital Technology Co., Ltd., a Korea corporation (“ADT”)
filed a claim against us as well as the other names parties whom are former and
current officers of the Company, alleging breach of contract relating to an
agreement to settle an earlier dispute involving the investment by ADT in
Lexon and its subsequent unilateral decision to rescind the investment and
calling for a refund of the partial investment made in Lexon. The investment was
made by ADT on or about January 16, 2007. The total amount of damages claimed
under the pending lawsuit is $150,000 plus filing costs, interest and attorney
fees for an aggregate amount of $178,522.05.





As of the
date of this Report, no answer was filed and ADT filed its first Motion for
Default Judgment on December 8, 2008, and a second Motion for Default Judgment
on December 22, 2008. The case was reassigned to a different judge and a case
management conference is scheduled for June 4, 2009.





In an
effort to amicably settle this dispute with ADT, we have previously offered to
issue shares equivalent to the principal investment amount of $150,000 in lieu
of cash, however, ADT has rejected such offer. We are currently in the process
of engaging local counsel to represent us in this matter.





On
September 5, 2008, Vivien and David Bollenberg, a current shareholder (the
“Bollenbergs”), filed a claim against us and other third parties, including
Byung Hwee Hwang (aka Ben Hwang) and other financial agents and institutions
involved in the alleged fraudulent transaction. The lawsuit is currently pending
in the Orange County Superior Court in Santa Ana, California. The filed
complaint alleges that Ben Hwang together with his representatives, including
his accountant, escrow agent and real estate agent/ broker, made certain
representations to and solicited the Bollenbergs to make an investment in
several companies and ventures including Lexon with the intent to misappropriate
the solicited funds for personal use.  The Bollenbergs allegedly
invested a total of $1,500,000 among and between the various companies and
ventures through Ben Hwang, of which investment amount approximately $550,000
was invested in Lexon ($150,000 for 600,000 shares at $0.25 per share and
$400,000 initially invested in Lexon Korea and later converted into 1,150,000
shares in Lexon for a total of 1,750,000 shares in Lexon).




2





We never
authorized Ben Hwang to furnish any such representations to the Bollenbergs on
behalf of Lexon. We were not made aware of such alleged transactions by and
between Ben Hwang and the Bollenbergs at the time such representations and
investments were made through Ben Hwang. At the time of the incidents described
in the complaint, Ben Hwang was an officer of Lexon until he resigned on or
about November 2, 2007 for reasons unrelated to this matter.





Based on
our information and belief, the 1,750,000 shares that were in fact issued to the
Bollenbergs in 2006 and 2007 were transferred from the pool of shares held by
J&B Hwang LLC, a company which is managed and owned by Ben
Hwang.  Due to the lack of operating funds, we did not file an answer
to the complaint. As of the date of this Report, several motions were filed by
the named defendants and the Bollenbergs, and the next scheduled hearing is set
for May 28, 2009 for a discovery motion filed by the Bollenbergs.





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





None.




PART II





ITEM
5.                      MARKET
FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS





The
following table sets forth, for the respective periods indicated, the prices of
our Common Stock in the over the counter market as reported by a market maker on
the OTC Bulletin Board (the “OTCBB”) and the National Quotation Bureau's Pink
Sheets for the periods for which this report is being filed. Such over the
counter market quotations are based on inter-dealer bid prices, without markup,
markdown or commission, and may not necessarily represent actual
transactions.










Fiscal
      Year 2008
                  
                  High
      Bid
                  
                  
                  Low
      BidQuarter
      ended 12/31/08
                  
                  $
                  0.007
                  
                  
                  $
                  0.007Quarter
      ended 9/30/08
                  
                  $
                  0.008
                  
                  
                  $
                  0.006Quarter
      ended 6/30/08
                  
                  $
                  0.007
                  
                  
                  $
                  0.007Quarter
      ended 3/31/08
                  
                  $
                  0.01
                  
                  
                  $
                  0.007





Fiscal
      Year 2007
                  
                  High
      Bid
                  
                  
                  Low
      BidQuarter
      ended 12/31/07
                  
                  $
                  0.05
                  
                  
                  $
                  0.015Quarter
      ended 9/30/07
                  
                  $
                  0.05
                  
                  
                  $
                  0.035Quarter
      ended 6/30/07
                  
                  $
                  0.035
                  
                  
                  $
                  0.035Quarter
      ended 3/31/07
                  
                  $
                  0.08
                  
                  
                  $
                  0.03







Trading
of our common stock has been limited or sporadic. The number of our shareholders
of record at May 4, 2009 was approximately 325.





We have
not paid any cash dividends to date and do not anticipate paying dividends in
the foreseeable future.




3


ITEM
6.                      SELECTED
FINANCIAL STATEMENT DATA
 
 None.




ITEM
7.                      MANAGEMENT'S
DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS





Cautionary Statement
Regarding Forward-Looking Statements





This
report may contain “forward-looking” statements. Examples of forward-looking
statements include, but are not limited to: (a) projections of revenues, capital
expenditures, growth, prospects, dividends, capital structure and other
financial matters; (b) statements of plans and objectives of our management or
Board of Directors; (c) statements of future economic performance; (d)
statements of assumptions underlying other statements and statements about us
and our business relating to the future; and (e) any statements using the words
“anticipate,” “expect,” “may,” “project,” “intend” or similar expressions. All
forward-looking statements included in this Report are based on information
available to the Company on the date hereof, and the Company assumes no
obligation to update any such forward-looking statement. It is important to note
that the Company's actual results could differ materially from those in such
forward-looking statements. Additionally, the following discussion and analysis
should be read in conjunction with the Financial Statements and notes thereto
appearing elsewhere in this Report.





General





Effective
December 8, 2004, we acquired a majority control (90.16%) of Techone Company,
Ltd., a Republic of South Korea corporation (“Techone” ), through an investment
of $1,585,000 financed through the sale of our restricted common stock to two
accredited investors. During February 2006, the Company changed the name of
Techone to Lexon Semiconductor Corporation (“Lexon Semi”). Lexon Semi is a
corporation that manufactures and sells Low Temperature Cofired Ceramic (LTCC)
components. The Company has operated Lexon Semi as a majority-owned subsidiary
and the business of Lexon Semi has been the operating business of the
Company.





To date,
our source of liquidity has been proceeds from the sale of our common stock, and
the issuance of convertible notes and promissory notes to finance operations and
business activities. In each year we incurred significant losses which evidently
resulted in the suspension of the business operations of Lexon Semi as of July
2006.





Due to
our sole reliance on debt and equity financing to fund our operations to date,
in conjunction with the increased competition in this area, we have incurred a
loss and decided to shift our primary focus to seeking joint venture partners,
business acquisitions and business alliances in an effort to commence business
operations outside the LTCC-related market, although we have not reached any
definitive agreements to date.





Results of Operations forthe Year Ended
December 31, 2008 compared to December 31, 2007





Revenues.
We had no revenues for the year ended December 31, 2008 and December 31,
2007. Until an appropriate business opportunity is identified, we cannot predict
when or if we will be able to generate revenues from operations.





Operating
Expenses. Total operating expenses during the year ended December 31, 2008
were $119,636 in selling, general and administrative expenses compared to
$129,411 for the year ended December 31, 2007.





Operating
expenses since inception (July 18, 2001) total $3,808,715. Our net earning per
share for the year ended December 31, 2008 was $0.00, based on a weighted
average of 34,183,778 shares outstanding.





Other
Income (Expense). Other income for the year ended December 31, 2008, consisted
of interest expense of $19,647.




Liquidity and Capital
Resources





At
December 31, 2008, we had current assets of $3,727 and current liabilities of
$1,957,362 for negative working capital of $1,953,635. Current assets consisted
solely of cash and cash equivalents. We also had net property and equipment of
$1,012 for total assets of $4,739.





Current
liabilities at December 31, 2008, consisted of accounts payable of $26,847,
accounts payable-related parties of $1,320,481, accrued expenses of $49,276,
notes payable of $169,982, and liabilities related to discontinued operations of
$390,776, for total current liabilities of $1,957,362. We also had contingent
liabilities of $274,610.




4





For the
year ended December 31, 2008, net cash flows used in operating activities
totaled $49,570 compared to net cash flows used in operating activities of
$107,800 in the prior year. Our operating activities since inception have been
funded by the sale of our common stock and the issuance of convertible notes and
promissory notes.





For the
year ended December 31, 2008, there was no cash used in investing activities
compared to the net cash used in investing activities of $1,217 for the previous
year for the acquisition of property and equipment of $1,460 offset by the
proceeds received on sale of fixed assets of $243.





Net cash
used in financing activities for the year ended December 31, 2008 was zero
compared to $108,367 for the prior year which consisted of cash paid on notes
payable of $41,615 offset by proceeds from notes payable of
$149,982.





To date,
our source of liquidity has been proceeds from the sale of our common stock, and
the issuance of convertible notes and promissory notes to finance operations and
business activities. In each year we incurred significant losses which have
resulted in an accumulated deficit of $5,175,231 and a working capital deficit
of approximately $2,300,000 at December 31, 2008, and limited internal financial
resources. Accordingly, our financial statements include a going concern
qualification raising substantial doubt about Lexon's ability to continue as a
going concern. Our management hopes to be able to find additional sources of
funding and/or a possible business opportunity or combination in order to
commence revenue producing business operations during fiscal year 2009, although
no definitive terms or agreements for funding or a business combination have
been reached.




ITEM
8 .                      FINANCIAL
STATEMENTS





Our
financial statements for the reporting period are set forth immediately
following the signature page to this form 10-K.




ITEM
9 .                      CHANGES
IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
AND FINANCIAL DISCLOSURE





Effective
April 24, 2009, we dismissed Kim & Lee, Certified Public Accountants (“Kim
and Lee”) as our independent auditor for the fiscal year ended December 31,
2008. During their engagement for the last two fiscal years, there were no
disagreements with Kim and Lee on any matter of accounting principles or
practices, financial statement disclosure, or auditing scope or procedure which,
if not resolved to the satisfaction of Kim and Lee would have caused Kim and Lee
to make reference to the matter in their reports. Kim & Lee’s services for
the fiscal year ended December 31, 2008 was limited to the review of our
financial statements for our  Quarterly Report on Form 10-Q for each
of the quarters in 2008 except for the Annual Report on Form 10-K.
 
 We
engaged Choi, Kim & Park LLP (“CKP”) as our principal accountants to audit
and review our financial statements for the Annual Report on Form
10-K effective as of April 24, 2009. We, during our most recent fiscal year
and any subsequent interim period to the date hereof, did not have discussions
nor have we consulted with CKP regarding the following: (i) the application of
accounting principles to a specified transaction, either completed or proposed
or the type of audit opinion to be rendered on the our financial statements, and
neither a written report was provided to us nor oral advice was provided that
CKP concluded was an important factor considered by us in reaching a decision as
to the accounting, auditing or financial reporting issue; or (ii) any matters
that were the subject of a “disagreement,” as that term is defined in Item
304(a)(1)(iv) of Regulation S-K and the related instructions to Item 304
of Regulation S-K, or a reportable event.
 
 ITEM
9 A.                   CONTROLS
AND PROCEDURES


Evaluation
of Disclosure Controls and Procedures





Our Chief
Executive Officer and Chief Financial Officer (the “Certifying Officers”) are
responsible for establishing and maintaining our disclosure controls and
procedures. The Certifying Officers have designed such disclosure controls and
procedures to ensure that material information is made known to them,
particularly during the period in which this report was prepared. The Certifying
Officers have evaluated the effectiveness of our disclosure controls and
procedures as of the end of the period covered by this Report. Based on that
evaluation, the Certifying Officers have concluded that our disclosure controls
and procedures were not effective at the reasonable assurance level due to the
material weakness described below.




5





Management’s
Report on Internal Control Over Financial Reporting





Our
management is responsible for establishing and maintaining adequate internal
control over financial reporting (as defined in Rule 13a-15(f) under the
Exchange Act) and for assessing the effectiveness of our internal control over
financial reporting. Our internal control system is designed to provide
reasonable assurance to our management and board of directors regarding the
preparation and fair presentation of published financial statements in
accordance with United States’ generally accepted accounting
principles.





Our
internal control over financial reporting is supported by written 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 financial statements in accordance with generally
accepted accounting principles and that our receipts and expenditures are being
made only in accordance with authorizations of our management and our 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 our financial statements.





Our
management has assessed the effectiveness of our internal control over financial
reporting as of the end of our most recent fiscal year. Management’s assessment
included an evaluation of the design of our internal control over financial
reporting and testing of the operational effectiveness of our internal control
over financial reporting. Based on this assessment, our management has concluded
that our internal control over financial reporting was not effective at the
reasonable assurance level due to the material weaknesses described
below.





In light
of the material weaknesses described below, we performed additional analysis and
other post-closing procedures to ensure our consolidated financial statements
were prepared in accordance with generally accepted accounting principles.
Accordingly, we believe that the consolidated financial statements included in
this Report fairly present, in all material respects, our financial condition,
results of operations and cash flows for the periods presented.





A
material weakness is a control deficiency (within the meaning of the Public
Company Accounting Oversight Board (“PCAOB”) Auditing Standard No. 2) or
combination of control deficiencies that result in more than a remote likelihood
that a material misstatement of the annual or interim financial statements will
not be prevented or detected. The Certifying Officers have identified the
following three material weaknesses which have caused the Certifying Officers to
conclude that our disclosure controls and procedures were not effective at the
reasonable assurance level:





1. We do
not yet have written documentation of our internal control policies and
procedures. Written documentation of key internal controls over financial
reporting is a requirement of Section 404 of the Sarbanes-Oxley Act and will be
applicable to us for the year ending December 31, 2008. The Certifying Officers
evaluated the impact of our failure to have written documentation of our
internal controls and procedures on our assessment of our disclosure controls
and procedures and has concluded that the control deficiency that resulted
represented a material weakness.





2. We do
not have a sufficient segregation of duties within accounting functions, which
is a basic internal control. Due to our size and nature, segregation of all
conflicting duties may not always be possible and may not be economically
feasible. However, to the extent possible, the initiation of transactions, the
custody of assets and the recording of transactions should be performed by
separate individuals. The Certifying Officers evaluated the impact of our
failure to have segregation of duties on our assessment of our disclosure
controls and procedures and has concluded that the control deficiency that
resulted represented a material weakness.





To
remediate the material weaknesses in our disclosure controls and procedures
identified above, in addition to working with our independent auditors, we have
continued to refine our internal procedures to begin to implement segregation of
duties and to prepare a written documentation of our internal control policies
and procedures.





This
Report does not include an attestation report of our independent registered
public accounting firm regarding internal control over financial reporting.
Management’s report was not subject to attestation by our independent registered
public accounting firm pursuant to temporary rules of the SEC that permit the
Company to provide only management’s report in this Annual Report.





There
were no changes in our internal control over financial reporting that occurred
during our most recent fiscal quarter that have materially affected, or
reasonably likely to materially affect, our internal control over financial
reporting.




6





ITEM
9 B.                   OTHER
INFORMATION





None.


PART III





ITEM
10 .                    DIRECTORS
AND EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS;
COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT





The names
and ages of our current executive officers and directors and the positions held
by each of them are set forth below:





Name
            
            
            Age
            
            
            Position
            
            
            Dates ServedJoon
      Ho Chang
            
            
            63
            
            
            Chairman
      of the Board
            
            
            3/07
      to presentHyung
      Soon Lee
            
            
            57
            
            
            CEO,
      CFO, Secretary, Director
            
            
            3/07
      to presentKyu
      Hong Hwang
            
            
            62
            
            
            Director
            
            
            7/01
      to present





All of
our directors will hold office until the next Annual Meeting of Shareholders and
until their successors have been elected and qualified. The term of office for
each Officer is one year and until a successor is elected at the annual meeting
of the Board of Directors and is qualified, subject to removal by the Board of
Directors. We will reimburse Directors for their expenses associated with
attending Directors' meetings. However, Directors have not, nor is it
anticipated they will, receive any additional compensation for attending
Directors' meetings.





Joon Ho Chang.  Mr. Chang
is the founder of Orda Korea Co., Ltd., in Seoul, Korea, and was elected
Chairman and Chief Executive Officer in 1992, upon incorporation of the company
(1992-present). Mr. Chang has been in the IT/software business and served
various companies in various capacities, including Chairman of Hyun Young
Systems Co., Ltd. (1992-1988), and was elected a board member in 1988 of Dong-A
Computer Co. and served until 1992, and of Jung Won Systems Co. (1984-1989). Mr.
Chang received his Bachelor of Arts degree in Business and Economics from
Yonsei University in 1968.





Hyung Soon Lee. Prior to his
appointment as the CEO of the Company, Me. Lee served as the Project Manager of
the Company from 2004-2007 and was responsible for overseeing the expansion of
the Company's facilities. Mr. Lee served as the CEO and President of Group of
Environmental Architecture in Seoul, Korea from 1998 to 2004. Previously, Mr.
Lee served in various management positions, including his position as project
manager of Heerim Architects and Engineers (1994-1998), and Managing Director of
Sungjo Construction Co. (1992-1994). Mr. Lee received his Bachelor of Arts
degree in Architecture and Engineering from Hanyang University in Korea in
1975.




Kyu Hong Hwang. Mr. Hwang is a
successful private investor currently engaged in the ownership of Hongha
restaurant in Seoul. As a private investor and entrepreneur Mr. Hwang owned
Choyung Industrial Corporation representing Polaroid and Alcon in Korea. Mr.
Hwang started his business career with Daewoo in the office of planning and
coordination. Prior to his military service form 1969-1972, Mr. Hwang received a
law degree from Yonsei University in 1968.





Compliance with Section
16(a) of the Exchange Act





Section
16(a) of the Securities and Exchange Act of 1934, as amended, requires our
directors and certain officers, as well as persons who own more than 10% of a
registered class of our equity securities, (“Reporting Persons”) to file reports
of ownership and changes in ownership on Forms 3, 4 and 5 with the Securities
and Exchange Commission. To the best of our knowledge, we believe that all
Reporting Persons have complied on a timely basis with all filing requirements
applicable to them.





Code of
Ethics





None.




7




ITEM
11 .                    EXECUTIVE
COMPENSATION





Summary Compensation
Table





Set forth
below is a summary of compensation for our principal executive officer and our
two most highly compensated officers other than our principal executive officer
(collectively, the “named executive officers”) for our last two fiscal years.
Except as otherwise set forth below, there have been no annuity, pension or
retirement benefits ever paid to our officers, directors or
employees.





With the
exception of reimbursement of expenses incurred by our named executive officers
during the scope of their employment, none of the named executive officers
received other compensation, perquisites and/or personal benefits in excess of
$10,000.





Name
      and Principal Position
                  Year
                  Salary
      ($)
                  Bonus
      ($)
                  Stock
      Awards ($)
                  Option
      Awards ($)
                  Non-equity
      Incentive Plan Compensation ($)
                  All
      Other Compensation ($)
                  Total
      ($)Hyung
      Soon Lee CEO, President, CFO
                  2008
                  $36,000
                  $-0-
                  $-0-
                  $-0-
                  $-0-
                  $-0-
                  $36,0002007
                  $27,000
                  $-0-
                  $-0-
                  $-0-
                  $-0-
                  $-0-
                  $27,000







Accrued
Wages





Former
Executive Officers





As the
former Chief Executive Officer, Kenneth Eaken, had signed an employment contract
with Lexon in February 2000 for a term of three years subject to automatic
renewal unless earlier terminated pursuant to the terms of the employment
contract and calling for an annual compensation of
$125,000.   Lexon was unable to pay the annual compensation to
Mr. Eaken under the employment contract due to the lack of funds and the
subsequent suspension of the business operations. The Company accrued an
aggregate of unpaid compensation owed to Mr. Eaken in the amount of $775,014 as
of the quarter ending March 31, 2007. Mr. Eaken resigned as the Chief Executive
Officer on March 31, 2007 and the unpaid compensation remains unpaid and
outstanding.





J. Jehy
Lah, as the former Chairman of the Board, and Ben Hwang, as former director,
each has been accruing salary at an annual rate of $135,000 and $85,000 per
year, respectively, since July 1, 2002.  In fiscal year 2003, however,
Mr. Lah received payments of $50,000 towards his accrued salary while Mr. Hwang
received payments of $44,936 towards his accrued salary.  In addition,
Mr. Hwang received a payment of $10,000 in fiscal year 2004, for a total setoff
amount of $54,936 towards his accrued salary.





As of
June 30, 2007, an aggregate of accrued unpaid compensation owed to Mr. Lah was
$591,250 and $351,750 for Mr. Hwang. Each of Mr. Lah and Mr. Hwang agreed to
respectively waive and forfeit their entire accrued but unpaid
compensation.





Current
Executive Officers





Pursuant
to a resolution of the Board of Directors in 2006, it was approved that Hyung
Soon Lee, as the current Chief Executive Officer, would be paid an annual salary
of $36,000 effective April 1, 2007. The unpaid compensation has been accruing
since April 1, 2007 and as of the date of this annual report, the total
aggregate of unpaid compensation due and owing to Mr. Lee was
$63,000.





As of the
date of this annual report, the Company has accrued an aggregate of unpaid
compensation owed to its former and current officers in the amount of
$838,014.





Compensation Pursuant to
Plans





None.





Pension
Table





Not
Applicable.






8





Other
Compensation





None.





Compensation of
Directors





Our
directors do not receive any cash compensation, but are entitled to
reimbursement of their reasonable expenses incurred in attending directors’
meetings.





ITEM
12 .                    SECURITY
OWNERSHIP OF CERTAIN BENEFICIAL OWNERS ANDMANAGEMENT





The
following table sets forth as of May 4, 2009 the name and address and the number
of shares of our Common Stock, par value $0.001 per share, held of record or
beneficially by each person who held of record, or was known by us to own
beneficially, more than 5% of the shares of our Common Stock issued and
outstanding, and the name and shareholdings of each director and of all
officers and directors as a group.







Name and Address
                  
                  Number of Shares
                  
                  % of ClassJ.
      Jehy Lah
                    P.O.
      Box 9999
                    Newport
      Beach, CA
                  
                  
                  2,075,000
                  (1)
                  
                  6.07%Kenneth
      Eaken
                    12131
      Drujon Lane
                    Dallas,
      TX 75244
                  
                  
                  1,910,010
                  (2)
                  
                  5.59%Kyoung
      Ho Lim
                    876
      Vizeon-dong, Hanbit Apt. #106-503
                    Pyung
      Teck, Gyunggi-do, Korea
                  
                  
                  4,000,000
                  
                  
                  11.70%Vivien
      Bollenberg
                    24401
      Opal Hill Court
                    Laguna
      Niguel, CA92677
                  
                  
                  1,750,000
                  (3)
                  
                  5.12%





Securities Ownership of
Officersand
Directors


Name and Address
                                
                                
                                Number of Shares
                                
                                % of ClassHyung
      Soon Lee, CEO and CFO
                                  78-4
      Samsung-dong,
                                  Kangnam-ku,
      Seoul, Korea
                                
                                
                                725,000
                                (4)
                                
                                2.12%Kyu
      Hong Hwang, Director
                                  701
      Kwanghwamoon, #145
                                  Jongro-ku,
      Seoul, Korea
                                
                                
                                5,150,000
                                (5)
                                
                                15.07%Joon
      Ho Chang, Chairman
                                  172
      Keumgok-dong City Valley, Ste. 230
                                  Gyunggi-do,
      Korea
                                
                                
                                1,050,000
                                
                                
                                3.07%Total (3
      persons)
                                
                                
                                6,925,000
                                
                                
                                20.26%





(1)  Mr.
Lah is the manager and controlling member of JSL Group, LLC, an entity which
holds 1,450,000 shares. JSL also holds a 50% interest in PAC21C, LLC, an entity
which holds 625,000 shares. Mr. Lah is also the manager of PAC21C,
LLC.


(2)  The
number of shares held by Mr. Eaken includes shares representing his 25%
membership interest in PAC21C, LLC, an entity which holds 625,000
shares.


(3)  The
number of shares held as community property between Vivien Bollenberg and her
husband, David R. Bollenberg.


(4) All
of Mr. Lee’s shares are held through his wife, Kyung Joo Kang.


(5) Mr.
Hwang holds an aggregate of 5,150,000 shares, of which 840,000 shares are held
through his three children.




9




ITEM
13 .                      CERTAIN
RELATIONSHIPS AND RELATED TRANSACTIONS





Except as
indicated below, and for the periods indicted, there were no material
transactions, or series of similar transactions, during the fiscal years ended
December 31, 2008 and 2007, or any currently proposed transactions, or series of
similar transactions, to which we are a party, in which the amount involved
exceeds $60,000, and in which any director or executive officer, or any security
holder who is known by us to own of record or beneficially more than 5% of any
class of our common stock, or any member of the immediate family of any of the
foregoing persons, has an interest.






ITEM
14.                      PRINCIPAL
ACCOUNTANT FEES AND SERVICES





Kim and
Lee





Kim and
Lee was our independent auditor and examined our financial statements for the
year ended December 31, 2007, and reviewed the financial statements
included in our quarterly reports on Form 10-QSB in the year 2008. The audit and
review of the annual financial statements for the year ended December 31, 2008
was performed by Choi, Kim and Park LLP (“CKP”), as our new independent auditor
as of April 24, 2009.  Kim and Lee performed the services listed below and
was paid the fees listed below for the year ended December 31,
2008.





Audit
Fees





Kim and
Lee was paid aggregate fees of $30,000 for the year ended December 31, 2008 for
professional services rendered for the reviews of the financial statements
included in our quarterly reports on Form 10-QSB during this period. A total of
$20,000 was paid to CKP for professional services rendered for the audit of our
annual financial statements. In sum, the Company has paid and incurred a total
of $50,000 in audit fees between Kim and Lee, its former auditor, and CKP for
the year ended December 31, 2008.





Audited-Related
Fees





Kim and
Lee was not paid additional fees for either the year ended December 31, 2008, or
the fiscal year ended December 31, 2007 for assurance and related services
reasonably related to the performance of the audit or review of our financial
statements.





Tax Fees





Kim and
Lee was paid $2,000 for the fiscal year ended December 31, 2008 for professional
services rendered for tax compliance and tax advice during this fiscal year
period which related to the past tax returns for the Company for the fiscal
years 2003 through 2005. No other fees were paid for fiscal year ended December
31, 2008 or 2007.





All Other
Fees





Kim and
Lee was not paid any other fees for professional services during the year ended
December 31, 2008 or the fiscal year ended December 31, 2007.




PART
IV


ITEM
15.                    EXHIBITS
 
 (a)(1)
FINANCIAL STATEMENT SCHEDULES. The following financial statement schedules are
included as part of this report.
   (a)(2)
EXHIBITS. The following exhibits are included as part of this
report:
 Exhibit
      No.
              
              Description31.1
              
              Certification
      of Chief Executive Officer per Section 302 of the Sarbanes-Oxley Act of
      200231.2
              
              Certification
      of Chief Financial Officer per Section 302 of the Sarbanes-Oxley Act of
      200232
              
              Certification
      of Chief Executive and Financial Officer per Section 906 of the
      Sarbanes-Oxley Act of 2002
  (b)
REPORTS ON 8-K.
 
 One
report on Form 8-K was filed as of the date of this Report and is herein
incorporated by reference from our Form 8-K filed with the Commission on April
28, 2009.




10




SIGNATURES





In
accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused
this report to be signed on its behalf by the undersigned, thereunto duly
authorized.






LEXON
      TECHNOLOGIES, INC.Date:
      May 4, 2009
              By:
              /s/ Hyung
      Soon LeeHyung
      Soon LeePresident,
      Chief Executive Officer and Chief Financial Officer





In
accordance with the Exchange Act, this report has been signed below by the
following persons on behalf of the registrant and in the capacities and on the
dates stated.




















11






INDEX
TO CONSOLIDATED FINANCIAL STATEMENTS
    
 PageReports
      of Independent Registered Public Accounting Firms2-3Consolidated
      Financial Statements:Consolidated
      Balance Sheets4Consolidated
      Statements of Operations and Comprehensive Income (Loss)5Consolidated
      Statement of Shareholders’ Deficiency6Consolidated
      Statements of Cash Flows8Notes
      to Consolidated Financial Statements10
 
 
 
 
 
 
 12
  
 REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  
 To the
Board of Directors and Stockholders of Lexon Technologies, Inc.
 
 We have
audited the accompanying consolidated balance sheet of Lexon Technologies, Inc.
and subsidiary (a development stage company) (the “Company”) as of December 31,
2008 and the related consolidated statements of operations and comprehensive
income (loss), stockholders’ deficiency, and cash flows for the
year then ended.  These financial statements are the
responsibility of the Company's management.  Our responsibility is to
express an opinion on these financial statements based on our
audit.
 
 We
conducted our audit in accordance with the standards of the Public Company
Accounting Oversight Board (United States).  Those standards require that
we plan and perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement.  An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our
audit provides a reasonable basis for our opinion.
 
 In our
opinion, such consolidated financial statements present fairly, in all
material respects, the financial position of Lexon Technologies, Inc. and
subsidiary as of December 31, 2008, and the results of their operations and cash
flows for the year then ended, in conformity with accounting principles
generally accepted in the United States of America.
  We have
also audited the adjustments to the 2007 consolidated financial statements to
retroactively apply the change in accounting for discontinued operations, as
described in Note 3.  In our opinion, such adjustments are appropriate
and have been properly applied. We were not engaged to audit, review, or apply
any procedures to the 2007 consolidated financial statements of the Company
other than with respect to the adjustments and, accordingly, we do not express
an opinion or any form of assurance on the 2007 consolidated financial
statements taken as a whole.
 
 The
accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern.  As discussed in Note 1
to the consolidated financial statements, the Company has suffered recurring
losses from operations and had working capital deficiencies as of December 31,
2008, which raise substantial doubt about its ability to continue as a going
concern. Management's plans in regard to these matters are also described in
Note 1. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
 
 
 /s/ Choi,
Kim & Park, LLP
 
 
 Los
Angeles, California
 May 1,
2009
  
 
 13
 
 
 
 
 REPORT
OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM
  
 To the
Board of Directors and Stockholders
 of Lexon
Technologies, Inc. and Subsidiaries
 
 We have
audited the accompanying consolidated balance sheets of Lexon Technologies, Inc.
and Subsidiaries (development stage companies) (collectively, the “Company”) as
of December 31, 2007 and 2006, and the related consolidated statements of
operations, stockholders’ deficit and other comprehensive income (loss),
and cash flows for the years then ended.  These consolidated
financial statements are the responsibility of the company’s management. Our
responsibility is to express an opinion on these financial statements based on
our audits.
 
 The
financial statements of Lexon Technologies, Inc. and Subsidiaries as of December
31, 2005 and for the period from inception on July 18, 2001 through December 31,
2005 were audited by other auditors whose report dated April 15, 2006, on those
statements included an explanatory paragraph that the Company’s recurring losses
and negative working capital raise substantial doubt about its ability to
continue as a going concern as discussed in Note 1 to the consolidated financial
statements.
 
 We
conducted our audits in accordance with the standards of the Public Company
Accounting Oversight Board (United States). Those standards require that we plan
and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement.  The Company is not
required to have, nor were we engaged to perform, audits of its internal control
over financial reporting.  Our audits included consideration of
internal control over financial reporting as a basis for designating audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion on the effectiveness of the Company’s internal
control over financial reporting.  Accordingly, we express no such
opinion.  An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audits provide a reasonable basis for our
opinion.
 
 In our
opinion, the 2007 and 2006 consolidated financial statements referred to
above present fairly, in all material respects, the financial position of Lexon
Technologies, Inc. and Subsidiaries as of December 31, 2007 and 2006, and the
results of its operations and its cash flows for the years then ended in
conformity with accounting principles generally accepted in the United States of
America.
 
 The
accompanying consolidated financial statements have been prepared assuming that
the Company will continue as a going concern.  As discussed in Note 1
to the consolidated financial statements, the Company has suffered recurring
losses from operations and had working capital deficiencies as of December 31,
2007 and 2006, which raise substantial doubt about its ability to continue as a
going concern. Management's plans in regard to these matters are also described
in Note 1. The consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty.
 
 /s/ Kim
and Lee Corporation
 
 Los
Angeles, California
 March 25,
2008
 
 
 
 14
 
  LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Consolidated
Balance Sheets
 December
31, 2008 and 2007
 
 December
      31,
                  
                  
                  December
      31,ASSETS
                  
                  2008
                  
                  
                  2007Current
      AssetsCash
      and cash equivalents
                  
                  $
                  3,727
                  
                  
                  $
                  5,255Property
      and equipment, net
                  
                  
                  1,012
                  
                  
                  
                  1,176Assets
      related to discontinued operations
                  
                  
                  -
                  
                  
                  
                  109,798Total
      assets
                  
                  $
                  4,739
                  
                  
                  $
                  116,229
  LIABILITIES
      AND STOCKHOLDERS' DEFICIENCYCurrent
      liabilities:Accounts
      payable
                  
                  $
                  26,847
                  
                  
                  $
                  6,847Due
      to related parties
                  
                  
                  1,320,481
                  
                  
                  
                  1,296,092Accrued
      expenses
                  
                  
                  49,276
                  
                  
                  
                  29,628Notes
      payable
                  
                  
                  169,982
                  
                  
                  
                  169,982Liabilities
      related to discontinued operations
                  
                  
                  390,776
                  
                  
                  
                  528,586Total
      current liabilities
                  
                  
                  1,957,362
                  
                  
                  
                  2,031,135Contingent
      liabilities
                  
                  
                  274,610
                  
                  
                  
                  274,610Minority
      interest
                  
                  
                  -
                  
                  
                  
                  -Stockholders’
      deficiency:Common
      stock, $0.001 par value;100,000,000
      shares authorized;34,183,778
      shares issued and outstanding
                  
                  
                  34,184
                  
                  
                  
                  34,184Additional
      paid-in capital
                  
                  
                  3,066,839
                  
                  
                  
                  3,066,839Accumulated
      other comprehensive loss
                  
                  
                  (166,406
                  )
                  
                  
                  (115,308
                  )Deficit
      accumulated during the development stage
                  
                  
                  (5,161,850
                  )
                  
                  
                  (5,175,231
                  )Total
      stockholders' deficiency
                  
                  
                  (2,227,233
                  )
                  
                  
                  (2,189,516
                  )Total
      liabilities and stockholders' deficiency
                  
                  $
                  4,739
                  
                  
                  $
                  116,229
 
 The
accompanying notes are an integral part of the consolidated financial
statements.
 15
 
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Consolidated
Statements of Operations and Comprehensive Income (Loss)
 For
the Years Ended December 31, 2008 and 2007 and
 the
Period from July 18, 2001 (Inception) through December 31, 2008
 
 From
      July 18,2001(Inception)For
      the Years Ended
                  
                  
                  throughDecember
      31,
                  
                  
                  December
      31,2008
                  
                  
                  2007
                  
                  
                  2008Revenue
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  22,031Operating
      expenses:Research
      and development
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Selling,
      general and administrative
                  
                  
                  119,636
                  
                  
                  
                  129,411
                  
                  
                  
                  3,808,715Total
      operating expenses
                  
                  
                  119,636
                  
                  
                  
                  129,411
                  
                  
                  
                  3,808,715Loss
      from operations
                  
                  
                  (119,636
                  )
                  
                  
                  (129,411
                  )
                  
                  
                  (3,786,684
                  )Other
      income (expenses):Interest
      income
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  39,817Other
      income
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  6,000(Loss)
      on sale of assets
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (1,134
                  )Gain
      on debt cancellation
                  
                  
                  -
                  
                  
                  
                  888,000
                  
                  
                  
                  907,872Interest
      expense
                  
                  
                  (19,647
                  )
                  
                  
                  (8,324
                  )
                  
                  
                  (796,329
                  )Loss
      from investment
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (11,667
                  )Net
      other income (expenses)
                  
                  
                  (19,647
                  )
                  
                  
                  879,676
                  
                  
                  
                  144,559Income
      (loss) before income tax and minority interest
                  
                  
                  (139,283
                  )
                  
                  
                  750,265
                  
                  
                  
                  (3,642,125
                  ))Income
      taxes
                  
                  
                  6,326
                  
                  
                  
                  -
                  
                  
                  
                  6,326Income
      (loss) before minority interest
                  
                  
                  (145,609
                  )
                  
                  
                  750,265
                  
                  
                  
                  (3,648,451
                  )Minority
      interest
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Income
      (loss) from continuing operations
                  
                  
                  (145,609
                  )
                  
                  
                  750,265
                  
                  
                  
                  (3,648,451
                  )Income
      (loss) from discontinued operations, net of income tax
                  
                  
                  158,990
                  
                  
                  
                  (926
                  )
                  
                  
                  (1,513,399
                  )Net
      income (loss)
                  
                  
                  13,381
                  
                  
                  
                  749,339
                  
                  
                  
                  (5,161,850
                  )Other
      comprehensive income (loss):Foreign
      currency translation
                  
                  
                  (51,098
                  )
                  
                  
                  4,529
                  
                  
                  
                  (166,406
                  )Comprehensive
      income (loss)
                  
                  $
                  (37,717
                  )
                  
                  $
                  753,868
                  
                  
                  $
                  (5,328,256
                  ))Basis
      earnings (loss) per share
                  
                  $
                  (0.00
                  )
                  
                  $
                  0.02Weighted
      average number ofcommon
      stocks outstanding
                  
                  
                  34,183,778
                  
                  
                  
                  34,183,778
  
 The
accompanying notes are an integral part of the consolidated financial
statements.
 
 16
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Consolidated
Statement of Stockholders' Deficiency
 the
Period from July 18, 2001 (Inception) through December 31, 2008
 
 DeficitAccumulated
                    
                    
                    AccumulatedAdditional
                    
                    
                    
                    
                    
                    Other
                    
                    
                    During
      theCommon
      Stock
                    
                    
                    Paid-in
                    
                    
                    Subscription
                    
                    
                    Comprehensive
                    
                    
                    DevelopmentShares
                    
                    
                    Amount
                    
                    
                    Capital
                    
                    
                    Receivable
                    
                    
                    Income
      (loss)
                    
                    
                    StageBalance,
      Jul 18, 2001
                    
                    
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -
                    
                    
                    $
                    -Jul
      2001 - stock issued for services at $0.001 per share
                    
                    
                    13,720,000
                    
                    
                    
                    13,720
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Aug
      2001 - stock issued for cash at $0.25 per share
                    
                    
                    2,280,000
                    
                    
                    
                    2,280
                    
                    
                    
                    567,720
                    
                    
                    
                    (220,000
                    )
                    
                    
                    -
                    
                    
                    
                    -Oct
      2001 - stock issued for technology at $0.25 per share
                    
                    
                    1,500,000
                    
                    
                    
                    1,500
                    
                    
                    
                    373,500
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Net
      loss for the year ended Dec 31, 2001
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (522,180
                    )Balance,
      Dec 31, 2001
                    
                    
                    17,500,000
                    
                    
                    
                    17,500
                    
                    
                    
                    941,220
                    
                    
                    
                    (220,000
                    )
                    
                    
                    -
                    
                    
                    
                    (522,180
                    )Receipt
      of subscription receivable
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    220,000
                    
                    
                    
                    -
                    
                    
                    
                    -Apr
      2002 - stock issued to acquire Phacon Corp (Note 1)
                    
                    
                    1,648,778
                    
                    
                    
                    1,649
                    
                    
                    
                    (641,346
                    )
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Sep
      2002 - stock issued for cash at $0.25 per share
                    
                    
                    280,000
                    
                    
                    
                    280
                    
                    
                    
                    69,720
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Dec
      2002 - stock issued for cash at $0.83 per share
                    
                    
                    120,000
                    
                    
                    
                    120
                    
                    
                    
                    99,880
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Net
      loss for the year ended Dec 31, 2002
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (473,510
                    )Balance,
      Dec 31, 2002
                    
                    
                    19,548,778
                    
                    
                    
                    19,549
                    
                    
                    
                    469,474
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (995,690
                    )Jan
      2003 - stock issued for cash at $0.83 per share
                    
                    
                    240,000
                    
                    
                    
                    240
                    
                    
                    
                    199,760
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Mar
      2003 – stock issued for cash at $0.25 per share
                    
                    
                    840,000
                    
                    
                    
                    840
                    
                    
                    
                    209,160
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Dec
      2003 - stock issued for cash at $0.25 per share
                    
                    
                    60,000
                    
                    
                    
                    60
                    
                    
                    
                    14,940
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -Foreign
      currency translation
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    4,729
                    
                    
                    
                    -Net
      loss for the year ended Dec 31, 2003
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    -
                    
                    
                    
                    (611,808
                    )Balance,
      Dec 31, 2003
                    
                    
                    20,688,778
                    
                    
                    $
                    20,689
                    
                    
                    $
                    893,334
                    
                    
                    $
                    -
                    
                    
                    $
                    4,729
                    
                    
                    $
                    (1,607,498
                    )
 
 
 The
accompanying notes are an integral part of the consolidated financial
statements.
 
 17
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Consolidated
Statement of Stockholders' Deficiency (Continued)
 the
Period from July 18, 2001 (Inception) through December 31, 2008
 
 DeficitAccumulated
                  
                  
                  AccumulatedAdditional
                  
                  
                  
                  
                  
                  Other
                  
                  
                  During
      theCommon
      Stock
                  
                  
                  Paid-in
                  
                  
                  Subscription
                  
                  
                  Comprehensive
                  
                  
                  DevelopmentShares
                  
                  
                  Amount
                  
                  
                  Capital
                  
                  
                  Receivable
                  
                  
                  Income
      (loss)
                  
                  
                  StageBalance,
      Dec 31, 2003
                  
                  
                  20,688,778
                  
                  
                  $
                  20,689
                  
                  
                  $
                  893,334
                  
                  
                  $
                  -
                  
                  
                  $
                  4,729
                  
                  
                  $
                  (1,607,498
                  )Oct
      2004 - stock issued for cash at $0.25 per share
                  
                  
                  4,000,000
                  
                  
                  
                  4,000
                  
                  
                  
                  996,000
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Dec
      2004 - stock issued for cash at $0.11 per share
                  
                  
                  6,125,000
                  
                  
                  
                  6,125
                  
                  
                  
                  693,875
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Dec
      2004 - stock issued for services at $0.25 per share
                  
                  
                  1,000,000
                  
                  
                  
                  1,000
                  
                  
                  
                  249,000
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Dec
      2004 - stock issued in lieu of outstanding debt at $0.10 per
      share
                  
                  
                  2,370,000
                  
                  
                  
                  2,370
                  
                  
                  
                  234,630
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -Foreign
      currency translation
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  1,589
                  
                  
                  
                  -Net
      loss for the year ended Dec 31, 2004
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (907,200
                  )Balance,
      Dec 31, 2004
                  
                  
                  34,183,778
                  
                  
                  
                  34,184
                  
                  
                  
                  3,066,839
                  
                  
                  
                  -
                  
                  
                  
                  6,318
                  
                  
                  
                  (2,514,698
                  )Foreign
      currency translation
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (82,678
                  )
                  
                  
                  -Net
      loss for the year ended Dec 31, 2005
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (448,271
                  )Balance,
      Dec 31, 2005
                  
                  
                  34,183,778
                  
                  
                  
                  34,184
                  
                  
                  
                  3,066,839
                  
                  
                  
                  -
                  
                  
                  
                  (76,360
                  )
                  
                  
                  (2,962,969
                  )Foreign
      currency translation
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (20,773
                  )
                  
                  
                  -Investment
      loss
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (22,704
                  )
                  
                  
                  -Net
      loss for the year ended Dec 31, 2006
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (2,961,601
                  )Balance,
      Dec 31, 2006
                  
                  
                  34,183,778
                  
                  
                  
                  34,184
                  
                  
                  
                  3,066,839
                  
                  
                  
                  -
                  
                  
                  
                  (119,837
                  )
                  
                  
                  (5,924,570
                  )Foreign
      currency translation
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  4,529
                  
                  
                  
                  -Net
      income for the year ended Dec 31, 2007
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  749,339Balance,
      Dec 31, 2007
                  
                  
                  34,183,778
                  
                  
                  
                  34,184
                  
                  
                  
                  3,066,839
                  
                  
                  
                  -
                  
                  
                  
                  (115,308
                  )
                  
                  
                  (5,175,231
                  )
                    )Foreign
      currency translation
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  (51,098
                  )
                  
                  
                  -Net
      income for the year ended Dec 31, 2008
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  -
                  
                  
                  
                  13,381Balance,
      Dec 31, 2008
                  
                  
                  34,183,778
                  
                  
                  $
                  34,184
                  
                  
                  $
                  3,066,839
                  
                  
                  $
                  -
                  
                  
                  $
                  (166,406
                  )
                  
                  $
                  (5,161,850
                  )
  
 The
accompanying notes are an integral part of the consolidated financial
statements.
 
 18
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Consolidated
Statements of Cash Flows
 For
the Years Ended December 31, 2008 and 2007 and
 the
Period from July 18, 2001 (Inception) through December 31, 2008
 
 For
      the Years Ended
                        December
      31,
                      
                      
                      From
      July 18,
                        2001
                        (Inception)
                        through
                        December 31,2008
                      
                      
                      2007
                      
                      
                      2008Cash Flows From Operating
      Activities:Net
      income (loss)
                      
                      $
                      13,381
                      
                      
                      $
                      749,339
                      
                      
                      $
                      (5,161,850
                      )Adjustments
      to reconcile net income (loss) to net cashused
      in operating activitiesDepreciation
      and amortization
                      
                      
                      164
                      
                      
                      
                      501
                      
                      
                      
                      13,725Stock
      for services
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      263,720Stock
      for technology
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      375,000Gain
      on forgiveness of debt
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      (907,872
                      )Loss
      on sale of assets
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      1,134Change
      in assets and liabilities:(Decrease)
      increase in accounts payable
                      
                      
                      20,000
                      
                      
                      
                      (27,667
                      )
                      
                      
                      26,847(Decrease)
      increase in due to related parties
                      
                      
                      24,389
                      
                      
                      
                      -
                      
                      
                      
                      838,014(Decrease)
      increase in accrued expenses
                      
                      
                      19,647
                      
                      
                      
                      (826,674
                      )
                      
                      
                      49,275Increase
      in contingent liabilities
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      274,610Operating
      cash generated by (used in) discontinued operations
                      
                      
                      (28,011
                      )
                      
                      
                      (3,299
                      )
                      
                      
                      390,776Net
      Cash Provided by (Used in) Operating Activities
                      
                      
                      49,570
                      
                      
                      
                      (107,800
                      )
                      
                      
                      (3,836,621
                      )Cash Flows From Investing
      Activities:Acquisition
      of property and equipment
                      
                      
                      -
                      
                      
                      
                      (1,460
                      )
                      
                      
                      (16,114
                      )Proceeds
      received on sale of fixed assets
                      
                      
                      -
                      
                      
                      
                      243
                      
                      
                      
                      243Net
      Cash Used in Investing Activities
                      
                      
                      -
                      
                      
                      
                      (1,217
                      )
                      
                      
                      (15,871
                      )Cash Flows From Financing
      Activities:Proceeds
      from related party notes
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      482,468Proceeds
      from notes payable
                      
                      
                      -
                      
                      
                      
                      149,982
                      
                      
                      
                      1,356,469Payments
      made on notes payable
                      
                      
                      -
                      
                      
                      
                      (41,615
                      )
                      
                      
                      (41,615
                      )Proceeds
      from issuance of common stock
                      
                      
                      -
                      
                      
                      
                      -
                      
                      
                      
                      2,225,303Net
      Cash Provided by Financing Activities
                      
                      
                      -
                      
                      
                      
                      108,367
                      
                      
                      
                      4,022,625Net
      increase (decrease) in cash and cash equivalents
                      
                      
                      49,570
                      
                      
                      
                      (650
                      )
                      
                      
                      170,133Effect
      of currency exchange rate changesOn
      cash and cash equivalents
                      
                      
                      (51,098
                      )
                      
                      
                      5,678
                      
                      
                      
                      (166,406
                      )Cash
      and cash equivalent at beginning of period
                      
                      
                      5,255
                      
                      
                      
                      227
                      
                      
                      
                      -Cash
      and cash equivalent at end of period
                      
                      $
                      3,727
                      
                      
                      $
                      5,255
                      
                      
                      $
                      3,727
 
 The
accompanying notes are an integral part of the consolidated financial
statements.
 
 19
 
 
 LEXON TECHNOLOGIES, INC. AND
SUBSIDIARY
 (A
Development Stage Company)
 Consolidated
Statements of Cash Flows
 For
the Years Ended December 31, 2008 and 2007 and
 the
Period from July 18, 2001 (Inception) through December 31, 2008
 
 
 From
      July 18, 2001For
      the Years Ended
                  
                  
                  (Inception)December
      31,
                  
                  
                  through2008
                  
                  
                  2007
                  
                  
                  December
      31, 2008Supplemental
      Cash Flow Information:Cash
      Payments ForInterest
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  717,548Non-Cash
      Investing and Financing ActivitiesStock
      issued for technology
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  375,000Stock
      issued for services
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  263,720Stock
      issued for in lieu of debt
                  
                  $
                  -
                  
                  
                  $
                  -
                  
                  
                  $
                  237,000
 
 
 
 
 The
accompanying notes are an integral part of the consolidated financial
statements.
 
 
 
 20
 
  LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Notes
to Consolidated Financial Statements
 December
31, 2008 and 2007
 
 1.
Nature of Business and Going Concern
 
 Nature
of Business
 
 Lexon
Technologies, Inc. ("the Company" or "Lexon") was incorporated in April 1989
under the laws of state of Delaware, and owns 90.16% of Lexon Semiconductor
Corporation ("Lexon Semi" or  formerly known as Techone Co., Ltd
("Techone")) which develops and manufactures Low Temperature Cofired Ceramic
(LTCC) components, including LTCC wafer probe cards, LTCC circuit boards, LTCC
Light Emitting Diode (LED) displays and related products for the semiconductor
testing and measurement, custom Printed Circuit Board (PCB), and cellular
phone industries.  The Company currently has no other business
activities.
 
 Initially
registered as California Cola Distributing Company, Inc, the Company changed its
name twice; first to Rexford, Inc. in October 1992, and to the current name
in July 1999.
 
 In July
1999, Lexon acquired 100% of the outstanding common stock of Chicago Map
Corporation (CMC) in exchange for 10,500,000 shares of the Company's common
stock through a reverse acquisition accompanied by a recapitalization.  The
surviving entity, Lexon, reflected the assets and liabilities of Lexon and CMC
at their historical book values. Lexon dissolved CMC in 2002.
 
 In April
2002, Lexon acquired 100% of the outstanding common stock of Phacon Corporation
(Phacon) in exchange for 17,500,000 shares of Company's common stock through a
reverse acquisition accompanied by a recapitalization.  As part of the
agreement, the Company elected a 1 for 10 reverse stock split and the acquired
shares of Phacon were entirely canceled leaving the Company as the surviving
entity.
 
 In March
2003, the Company incorporated Lexon Korea Corporation (“Lexon Korea”) as a
wholly-owned subsidiary in Korea for the purpose of entering into potential
business combinations with Korean operating entities. Lexon Korea was
reorganized in August 2005, and as a result, the Company’s equity share in Lexon
Korea was reduced to 10%.
 
 In
December 2004, the Company acquired 90.16% of the voting stock of Techone
Company, Ltd, a company in Korea, by investing $1,588,000.  The
Company recognized goodwill of $1,851,692 in the acquisition.  The Company
acquired Techone to develop it as the Company’s core operating business in Korea
for manufacturing and selling LTCC related products.  However, the
development of the LTCC related products was not successful, and the operations
of Techone became highly leveraged financially.  In August 2005,
certain creditors filed an involuntary foreclosure and sold Techone’s assets
through public auction to satisfy secured debts.  This disposal of assets
resulted in a gain $1,315,469 for the year ended December 31,
2005.  In February 2006, Techone changed its name to Lexon
Semiconductor Corporation and all of its operation has been suspended due to
lack of operating working capital.
 
 
 Going
Concern
 
 The
Company’s consolidated financial statements are presented on a going concern
basis, which contemplates the realization of assets and satisfaction of
liabilities in the normal course of business.  The Company has experienced
recurring losses which have resulted in an accumulated deficit of
$5,161,850 and a working capital deficit of approximately $1,953,000 as of
December 31, 2008.   The development of the LTCC related products by Lexon
Semi, which had been pursued as the Company’s core business, was unsuccessful,
and most of assets of Lexon Semi were foreclosed and sold by creditors in August
2005. Since then, the operations of Lexon Semi have been
suspended.  These situations raise substantial doubt about the
Company's ability to continue as a going concern.   The Company’s ability
to continue as a going concern is contingent upon its ability to secure
additional financing, initiate sales of its products and attain profitable
operations.
 
 As
discussed earlier within this Note and Note 3, the development of planned
products of Lexon Semi, the Company’s core business operation, was unsuccessful
and most of assets of Lexon Semi were foreclosed and sold by creditors in August
2005.  Since then, the operations of Lexon Semi have been
suspended.
 
 The
Company’s management is currently pursuing various sources of equity or debt
financing, although there can be no assurance that the Company will be able to
secure financing when needed or obtain on such terms that are satisfactory to
the Company.
 
 The
accompanying consolidated financial statements do not include any adjustments
relating to the recoverability and classification of asset carrying amounts or
the amount and classification of liabilities that might result from the outcome
of this uncertainty.  It is the intent of management to continue to raise
additional funds to sustain operations and to pursue acquisitions of operating
companies in order to generate future profits for the Company.
 
 21
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Notes
to Consolidated Financial Statements
 December
31, 2008 and 2007
 
 2.
Significant Accounting Policies
 
 The
following summary of significant accounting polices of the Company is presented
to assist in understanding the Company’s financial statements. These accounting
policies conform to the accounting principles generally accepted in the United
States of America, and have been consistently applied in the preparation of the
financial statements.
 
 Principles of
Consolidation. The consolidated
financial statements include the accounts of Lexon Technologies, Inc., and its
majority-owned subsidiary, Lexon Semiconductor Co., Ltd.  All material
intercompany accounts and transactions have been eliminated in the
consolidation. Minority interests are recorded to the extent of equity
owned. Losses in excess of minority interest equity capital are charged against
the majority interest and will be reversed when the losses reverse.
 
 Useof
Estimates. Preparation of financial statements in accordance with
accounting principles generally accepted in the United States of America
requires management to make estimates and assumptions that affect the amounts
reported in the financial statements and related notes to financial
statements.  These estimates are based on management's best knowledge
of current events and actions the Company may undertake in the future. Actual
results may ultimately differ from estimates, although management does not
believe such changes will materially affect the financial statements in any
individual year.
 
 Revenue
Recognition.  Revenue is recognized, in accordance with Staff
Accounting Bulletin No. 101 "Revenue Recognition in Financial Statements" ("SAB
No. 101"), when delivery has occurred provided there is persuasive evidence of
an agreement, the fee is fixed or determinable and collection of the related
receivable is probable.   As such, the Company recognizes revenue
for its products generally when the product is shipped and title passes to the
buyer.  There are no multi-deliverables or product warranties
requiring accounting recognition.
 
 Translation of Foreign
Currency. The Company applies FASB No. 52, Foreign
Currency Translation, for translating foreign currency into US
dollars in our consolidation of the financial statements.  Upon
consolidation of the Company’s foreign subsidiary into the Company’s
consolidated financial statements, any balances with the subsidiary denominated
in the foreign currency are translated at the exchange rate at year end. The
financial statements of Lexon Semi have been translated based upon Korean Won as
the functional currency.  Lexon Semi’s liabilities were translated using
the exchange rate at period end and income and expense items were translated at
the average exchange rate for the periods reported. The resulting translation
adjustment was included in other comprehensive income (loss).
 
 Cash and Cash
Equivalents. The Company considers all highly liquid investments with maturity
dates of three months or less when purchased to be cash
equivalents.
 
 Propertyand Equipment. Property and
equipment are stated at cost less accumulated depreciation and amortization.
Additions and major renewals are capitalized. Repairs and maintenance are
charged to expense as incurred. Upon disposal, the related cost and accumulated
depreciation are removed from the accounts, with the resulting gain or loss
included in operating income. Depreciation is provided principally on the
straight-line method over the estimated useful lives of the assets, which
range from three to forty years.
 
 In
accordance with Statement of Financial Accounting Standards No. 144, the Company
records impairment of long-lived assets to be held and used or to be disposed of
when indicators of impairment are present and the undiscounted cash flows
estimated to be generated by those assets are less than the carrying amount.
 
 Investments. Investments
in available-for-sale securities are being recorded in accordance with Statement
of Financial Accounting Standards No. 115, "Accounting for Certain Investments
in Debt and Equity Securities".  Equity securities that are not held
principally for the purpose of selling in the near term are reported at fair
market value with unrealized holding gains and losses excluded from earnings and
reported as a separate component of stockholders' equity.  Investments
in equities where the Company has the ability to exercise influence over the
operations are accounted for using the equity method.
  Intangible Assets. Intangible assets
such as cost of obtaining industrial rights and patents are stated at cost, net
of amortization computed using the straight-line method over five to ten
years.
 
 Goodwill.Beginning
January 1, 2002, the Company adopted Statement of Financial Accounting
Standards (“SFAS”) No. 142,Goodwill and Other Intangible
Assets.  According to this statement, goodwill and other
intangible assets are no longer subject to amortization, but instead must be
reviewed annually for impairment by applying a fair value-based
test.
 
 Impairment of Long-lived
Assets. The Company reviews long-lived assets to be held and used in
operations for impairment whenever events or changes in circumstances indicate
that the carrying value of an asset may be impaired. An impairment loss is
recognized when the estimated fair value of the assets is less than the carrying
value of the assets.  The Company recognized no impairment during the years
ended December 31, 2008 and 2007.
  22
  LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Notes
to Consolidated Financial Statements
 December
31, 2008 and 2007
 
 Basic Earning (Loss) Per
Share. The
computations of basic earning (loss) per share of common stock are based on the
weighted average number of common shares outstanding during the each period of
the consolidated financial statements.  Common stock equivalents,
consisting of stock options and warrants, have not been included in the
calculation as their effect is anti-dilutive for the periods
presented.
 
 Fair Value of Financial
Instrument.The estimated fair value of amounts reported in
the consolidated financial statements have been determined using available
market information and valuation methodologies, as applicable.  The
carrying amount of cash and cash equivalents, accounts payable, and all other
liabilities approximate their fair value because of their short term maturities
at December 31, 2008 and 2007, unless otherwise stated.
 
 Stock-Based Compensation. The Company
accounts for share-based compensation in accordance with the fair value
recognition provisions of SFAS No. 123(R),Share-based Payment , which
requires all share-based payments to employees, including grants of employee
stock options, to be recognized in the consolidated financial statements based
on their fair values. The fair value of stock options is calculated by using the
Black-Scholes option pricing formula that requires estimates for expected
volatility, expected dividends, the risk-free interest rate and the term of
the option.  If any of the assumptions used in the Black-Scholes model
change significantly, share-based compensation expense may differ materially in
the future from that recorded in the current period.
 
 Income Taxes.Income taxes are provided
under the asset and liability method as required by SFAS No. 109,Accounting for Income Taxes
.. Under this method, deferred income taxes are recognized for the tax
consequences of “temporary differences” by applying enacted statutory tax rates
applicable to future years to differences between the financial statement
carrying amounts and the tax basis of existing assets and liabilities. The
effect of a tax rate change on deferred taxes is recognized in operations in the
period that the change in the rate is enacted. Valuation allowances are
established when necessary to reduce net deferred tax assets to the amount
expected to be realized.
  The
Company adopted the provisions of Interpretation No. 48,Accounting for Uncertainty
inIncome Taxes,
an interpretation of FASB Statement No. 109 (“FIN 48”) on
January 1, 2007. At the adoption date and as of December 31, 2007, the
Company had no material unrecognized tax benefits and no adjustments to
liabilities or operations were required. The Company recognizes interest and
penalties related to uncertain tax positions in income tax expense. There was no
expense related to interest and penalties for the year ended December 31,
2008.
 
 Reclassifications. Certain
amounts from prior years have been reclassified to conform to the current year’s
presentation.
 
 Recent Accounting
Pronouncements. In December 2007, the FASB issued SFAS
No. 141R, “Business Combinations” (“SFAS 141R”). SFAS 141R amends the
requirements for accounting for business combinations.  SFAS 141R will be
effective after the beginning of the first annual reporting period beginning on
or after December 15, 2008.  The Company is currently evaluating the
potential impact of the adoption of SFAS 141R on the Company’s consolidated
financial statements.
 
 In
December 2007, the FASB issued SFAS No. 160, Noncontrolling Interests
in Consolidated Financial Statements, an amendment of ARB No. 51 (“SFAS
160”). This statement establishes accounting and reporting standards for the
noncontrolling interest in a subsidiary and for the deconsolidation of a
subsidiary. Minority interests will be recharacterized as noncontrolling
interests and classified as a component of shareholders’ equity separate from
the parent’s equity. In addition, SFAS 160 establishes reporting requirements
that provide sufficient disclosures that clearly identify and distinguish
between the interests of the parent and the interests of the noncontrolling
owners. This statement is effective prospectively, except for certain
retrospective disclosure requirements, for fiscal years beginning after
December 15, 2008. Accordingly, the Company will adopt SFAS 160 in 2009.
The presentation and disclosure requirements of this standard must be applied
retrospectively for all periods presented and will impact how the Company
presents and discloses noncontrolling interests and income from noncontrolling
interests in our consolidated financial statements.
 
 In
May 2008, the FASB issued FASB Staff Position No. APB 14-1,
“Accounting for Convertible Debt Instruments That May Be Settled in Cash
upon Conversion (Including Partial Cash Settlement)” (“FSP APB 14-1”) which
clarifies that convertible debt instruments that may be settled in cash or
other assets upon conversion are not addressed by APB No. 14, “Accounting
for Convertible Debt and Debt Issued with Stock Purchase Warrants.”
Additionally, FSP APB 14-1 requires an entity to separately account for the
liability and equity components of a convertible instrument to reflect an
entity’s nonconvertible debt borrowing rate when interest cost is recognized in
subsequent periods. FSP APB 14-1 also expands the disclosure requirements
regarding convertible debt instrument terms and how the instrument is reflected
in an entity’s financial statements. FSP APB 14-1 is effective for financial
statements issued for fiscal years beginning after December 15, 2008, and
interim periods within those fiscal years. The Company is currently evaluating
the potential impact of FSP APB14-1 on its consolidated financial
statements.
  
 23
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Notes
to Consolidated Financial Statements
 December
31, 2008 and 2007
 
 In
May 2008, the FASB issued SFAS No. 162, “The Hierarchy of
Generally Accepted Accounting Principles” (“SFAS 162”). SFAS 162 is
intended to improve financial reporting by identifying a consistent framework,
or hierarchy, for selecting accounting principles to be used in preparing
financial statements that are presented in conformity with U.S. generally
accepted accounting principles for nongovernmental entities. SFAS 162 will
become effective 60 days following the SEC’s approval of the Public Company
Accounting Oversight Board Auditing amendments to AU Section 411, “The
Meaning of Present Fairly in Conformity with Generally Accepted Accounting
Principles.” The Company is currently evaluating the impact of
SFAS 162.
  Other
recent accounting pronouncements issued by the FASB (including its Emerging
Issues Task Force), the AICPA and the SEC did not or are not believed by
management to have a material impact on our company’s present or future
consolidated financial statements.
 
  3.
Discontinued Operations
 
 As stated
in Note 1, Lexon Semi, the Korean subsidiary, has ceased all operations in
2006.  Currently, the regulatory body in the Republic of Korea has
disqualified the subsidiary from conducting further business.  Most of
the assets of the subsidiary have been liquidated through a public auction to
satisfy secured debt.
 
 
 4.
Property and Equipment
 
 Property
and equipment consists of the following at December 31:
 
 2008
                  
                  
                  2007Computer
      and equipment
                  
                  $
                  10,450
                  
                  
                  $
                  10,450Furniture
      and fixture
                  
                  
                  4,287
                  
                  
                  
                  4,28714,737
                  
                  
                  
                  14,737Accumulated
      depreciation
                  
                  
                  (13,725
                  )
                  
                  
                  (13,561
                  )Net
      property and equipment
                  
                  $
                  1,012
                  
                  
                  $
                  1,176
 
 Depreciation
expense for the years ended December 31, 2008 and 2007 was $164 and $1,210,
respectively.
 
 
 5.
Investment
 
 In 2003,
the Company’s subsidiary in Korea, Lexon Semi, invested $125,967 in a 10% voting
stock of Mirae Sojae Company, a Korean entity.  The investment was
recorded under the cost method.  The fair value of this investment as
of December 31, 2007 was $104,189.  During 2008, Mirae Sojae Company
ceased to operate as a viable company, and the investment was written off in
2008.
 
 
 6.
Due to Related Parties
 
 The
Company has not been able to pay compensation to its officers on time, and has
accrued its past-due compensations.  During 2007, $888,000 was waived
by the former officers. The Company recorded this waived amount as gain on
debt cancellation for the year ended December 31, 2007.  As of
December 31, 2008 and 2007, the balance of the past-due compensation was
$838,014 and $802,014, respectively.
 
 In
addition, the Company has loans payable to officers, directors and shareholders
of the Company and other related individuals.   These amounts are
non-interest bearing and payable on demand.  As of December 31, 2008
and 2007, the balance of theses loans was $390,507 and $402,118,
respectively.
 
 24
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Notes
to Consolidated Financial Statements
 December
31, 2008 and 2007
 
 Also,
there are interest bearing notes payable to related parties consisting of the
following at December 31:
 
 
 2008
                  
                  
                  2007Unsecured
      note payable to a shareholder, with interest at 7.5% per annum. Note is in
      default and is payable on demand.
                  
                  $
                  5,000
                  
                  
                  $
                  5,000Expired
      convertible debt issued to a former employee, with interest at 7.5%
      per annum. The conversion maturity date was in October
      2004.  The note is payable on demand.
                  
                  
                  30,000
                  
                  
                  
                  30,000Expired
      convertible debt issued to a Director, with interest at 7.5% per annum.
      The conversion maturity date was in October 2005.  The note is
      payable on demand.
                  
                  
                  56,960
                  
                  
                  
                  56,960Total
      notes payable
                  
                  $
                  91,960
                  
                  
                  $
                  91,960
 
 
 7.
Notes Payable
 
 Notes
payable consisted of the following at December 31:
 
 
 2008
                  
                  
                  2007Unsecured
      note payable to an unrelated individual, with interest at 7.5% per annum.
      The note is in default and is payable on demand.
                  
                  $
                  20,000
                  
                  
                  $
                  20,000Unsecured
      note payable to an unrelated party, with interest at 7.5% per annum. As
      disclosed in Note 8, the creditor has filed suit to collect on this
      note.
                  
                  
                  149,982
                  
                  
                  
                  149,982Total
      notes payable
                  
                  $
                  169,982
                  
                  
                  $
                  169,982
 
 
 8.
Commitments and Contingencies
 
 Contingent
liabilities
 
 The
Company has contingent liabilities of $274,610 to various creditors of a
predecessor company. Management determined that it is reasonably certain that
the amount will be paid in future.
 
 Legal
Proceedings
 
 On July
14, 2008, Advanced Digital Technology Co., Ltd., a Korea corporation (“ADT”)
filed a claim against us as well as the other names parties whom are former and
current officers of the Company, alleging breach of contract relating to an
agreement to settle an earlier dispute involving the investment by ADT in Lexon
and its subsequent unilateral decision to rescind the investment and calling for
a refund of the partial investment made in Lexon.  The total amount of
damages claimed under the pending lawsuit is $150,000 plus filing costs,
interest and attorney fees for an aggregate amount of $178,522.
 
 
 25
 
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Notes
to Consolidated Financial Statements
 December
31, 2008 and 2007
 
 
 On
September 5, 2008, Vivien and David Bollenberg, a current shareholder (the
“Bollenbergs”), filed a claim against us and other third parties, including
Byung Hwee Hwang (aka Ben Hwang) involved in the alleged fraudulent
transaction.  The lawsuit is currently pending in the Orange County
Superior Court in Santa Ana, California.  The filed complaint alleges
that Ben Hwang together with his representatives, including his accountant,
escrow agent and real estate agent/ broker, made certain representations to and
solicited the Bollenbergs to make an investment in several companies and
ventures including the Company with the intent to misappropriate the solicited
funds for personal use.  The Bollenbergs allegedly invested a total of
$1,500,000 among and between the various companies and ventures through Ben
Hwang, of which investment amount approximately $550,000 was invested in Lexon
($150,000 for 600,000 shares at $0.25 per share and $400,000 initially invested
in Lexon Korea and later converted into 1,150,000 shares in Lexon for a total of
1,750,000 shares in Lexon).  The outcome of this case is uncertain at
this time.
 
 
 9. Income Taxes
  Significant
components of deferred tax assets are as follows:
  Years Ended December 31,2008
                  
                  
                  2007Loss
      carry forwards
                  
                  $
                  1,352,904
                  
                  
                  $
                  1,317,226Intangible
      assets
                  
                  
                  793,265
                  
                  
                  
                  793,265Other
                  
                  
                  229,720
                  
                  
                  
                  42,509Total
      deferred tax asset
                  
                  
                  2,375,889
                  
                  
                  
                  2,153,000Valuation
      allowance
                  
                  
                  (2,375,889
                  )
                  
                  
                  (2,153,000
                  )Total
      deferred tax asset, net
                  
                  $
                  -
                  
                  
                  $
                  -
  
 The
following table accounts for the differences between the expected federal tax
benefit (based on the statutory U.S. federal income tax rate of 34%) and the
actual tax provision:
  Years
      Ended December 31,2008
                          
                          
                          2007Expected
      federal tax benefit
                          
                          
                          34
                          %
                          
                          
                          34
                          %State
      tax expense, net of expected federal tax benefit
                          
                          
                          (216
                          )%
                          
                          
                          (4
                          )%Foreign
      loss not subject to U.S. federal income tax
                          
                          
                          (932
                          )%
                          
                          
                          0
                          %Other
                          
                          
                          15
                          %
                          
                          
                          (49
                          )%Increase
      (decrease) in valuation allowance
                          
                          
                          1,131
                          %
                          
                          
                          19
                          %Total
      tax provision
                          
                          
                          32
                          %
                          
                          
                          0
                          %
  As of
December 31, 2008, the Company had approximately $3,440,000 of net
operating loss (“NOL”) carryforwards for U.S. federal income tax purposes
expiring in 2019 through 2028. In addition, the Company has California state NOL
carryforwards of approximately $2,240,000 expiring in 2012 through 2018.
 
 The
ability to realize the tax benefits associated with deferred tax assets, which
includes benefits related to NOL’s, is principally dependent upon the Company’s
ability to generate future taxable income from operations.  The Company has
provided a full valuation allowance for its net deferred tax assets due to the
Company’s net operating losses.  The valuation allowance has increased
by $222,889 during 2008.
 
 Section 382
of the Internal Revenue Code (“IRC”) imposes limitations on the use of NOL’s and
credits following changes in ownership as defined in the IRC. The limitation
could reduce the amount of benefits that would be available to offset future
taxable income each year, starting with the year of an ownership
change.
 
 
 
 26
 
 
 LEXON
TECHNOLOGIES, INC. AND SUBSIDIARY
 (A
Development Stage Company)
 Notes
to Consolidated Financial Statements
 December
31, 2008 and 2007
 
 10.
Stock Option Plan
 
 The
Company accounts for its stock options in accordance with SFAS 123(R)
"Accounting for Stock - Based Compensation" and SFAS 148 "Accounting for Stock -
Based compensation - Transition and Disclosure." Value of options granted has
been estimated by the Black Scholes option pricing model. The assumptions are
evaluated annually and revised as necessary to reflect market conditions and
additional experience.
 
 On
September 14, 2000, the Company adopted a Non-Qualified Stock Option Plan (the
"2000 Plan") under which options to acquire common stock of the Company may be
granted to employees and consultants of the Company or its subsidiaries. 
Under this Plan, a total of 250,000 (post-split) shares of options, subject to
certain restrictions, are authorized to be granted. The exercise price of
each option is determined by the Board of Directors on the date of grant.
 The Board also determines the term, restrictions on vesting and exercise
dates with expected life of the option term not exceeding 5 years.
 
 There
were no stock options granted during the years ended December 31, 2008 and
2007.
            27