---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C.20549

FORM 10-Q

(Mark One)

[X] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

For the fiscal period ended:June 30, 2010

[   ] 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.)
|                                                                     |                           
|14830 Desman Road                                                    | 90638                     
|(Address of principal executive offices)                             | (Zip Code)                

Issuer's telephone number, including area code:(714)
522-0270

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

|Title of each class | Name of each exchange on which registered
|------------------- | -----------------------------------------
|None                | 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. [   ]

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 [X]      No [   ] (2) Yes
[X]      No [   ]

Indicate by check mark whether the registrant has submitted
electronically and posted on its corporate Web site, if any, every Interactive
Data File required to be submitted and posted pursuant to Rule 405 of Regulation
S-T (§232.405 of this chapter) during the preceding 12 months (or for such
shorter period that the registrant was required to submit and post such files.)
Yes [X]      No [   ]

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 [  
]    Accelerated filer [   ]   
Non-accelerated filer [   ]    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 [  
]       No [X]

Indicate the number of shares outstanding of each of the
issuers classes of common stock, as of the latest practicable date.

As of August 17, 2010, Lexon had 515,289,721shares of common
stock, par value $0.001 outstanding.

---

PART I  FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS

LEXON TECHNOLOGIES, INC. BALANCE SHEETS

|ASSETS                                 |   |             |  |   |              | 
|-------------------------------------- | - | ----------- |  | - | ------------ | 
|                                       |   | (Unaudited) |  |   |              | 
|                                       |   | June 30,    |  |   | December 31, | 
|                                       |   | 2010        |  |   | 2009         | 
|Current assets:                        |   |             |  |   |              | 
|Cash and cash
      equivalents        | $ | 10,534      |  | $ | 61,661       | 
|Accounts receivable, net               |   | 342,683     |  |   | 468,821      | 
|Inventories                            |   | 516,832     |  |   | 838,220      | 
|Other current assets                   |   | 18,000      |  |   | 18,000       | 
|                                       |   |             |  |   |              | 
|Total
      current assets             |   | 888,049     |  |   | 1,386,702    | 
|                                       |   |             |  |   |              | 
|Due from related parties               |   | 130,000     |  |   | 190,000      | 
|                                       |   |             |  |   |              | 
|Property and equipment, net            |   | 83,318      |  |   | 112,392      | 
|                                       |   |             |  |   |              | 
|Other assets:                          |   |             |  |   |              | 
|Intangibles, net of
      amortization |   | 480,767     |  |   | 276,365      | 
|Security deposits                      |   | 20,748      |  |   | 20,748       | 
|Goodwill                               |   | 3,214,289   |  |   | 3,214,289    | 
|                                       |   |             |  |   |              | 
|Total other assets                     |   | 3,715,804   |  |   | 3,511,402    | 
|                                       |   |             |  |   |              | 
|Total assets                           | $ | 4,817,171   |  | $ | 5,200,496    | 

The accompanying notes are an integral part of the unaudited
financial statements.

---

LEXON TECHNOLOGIES, INC.BALANCE SHEETS

|LIABILITIES AND STOCKHOLDERS EQUITY                                                                                                                                                                                          |   |             |   |   |              |  
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ----------- | - | - | ------------ | -
|                                                                                                                                                                                                                              |   | (Unaudited) |   |   |              |  
|                                                                                                                                                                                                                              |   | June 30,    |   |   | December 31, |  
|                                                                                                                                                                                                                              |   | 2010        |   |   | 2009         |  
|Current liabilities:                                                                                                                                                                                                          |   |             |   |   |              |  
|                                                                                                                                                                                                                              |   |             |   |   |              |  
|Accounts payable                                                                                                                                                                                                              | $ | 544,278     |   | $ | 552,634      |  
|Due to related parties                                                                                                                                                                                                        |   | 91,960      |   |   | 91,960       |  
|Line of credit                                                                                                                                                                                                                |   | 450,000     |   |   | 450,000      |  
|Current portion of notes payable                                                                                                                                                                                              |   | 251,260     |   |   | 249,534      |  
|Current portion
      of capital lease obligations                                                                                                                                                                            |   | 21,082      |   |   | 21,888       |  
|Accrued expenses                                                                                                                                                                                                              |   | 226,260     |   |   | 110,747      |  
|Other current
      liabilities                                                                                                                                                                                               |   | 31,213      |   |   | -            |  
|Total current liabilities                                                                                                                                                                                                     |   | 1,616,053   |   |   | 1,476,763    |  
|Contingent liabilities                                                                                                                                                                                                        |   | -           |   |   | 274,610      |  
|Long-term liabilities:                                                                                                                                                                                                        |   |             |   |   |              |  
|                                                                                                                                                                                                                              |   |             |   |   |              |  
|Notes payable, net of current
      portion                                                                                                                                                                                   |   | 57,395      |   |   | 99,460       |  
|Capital lease
      obligations, net of current portion                                                                                                                                                                       |   | 17,526      |   |   | 28,561       |  
|Deferred rent                                                                                                                                                                                                                 |   | 42,881      |   |   | 53,398       |  
|Total
      long-term liabilities                                                                                                                                                                                             |   | 117,802     |   |   | 181,419      |  
|                                                                                                                                                                                                                              |   |             |   |   |              |  
|Total liabilities                                                                                                                                                                                                             |   | 1,733,855   |   |   | 1,932,792    |  
|                                                                                                                                                                                                                              |   |             |   |   |              |  
|Stockholders equity:                                                                                                                                                                                                         |   |             |   |   |              |  
|                                                                                                                                                                                                                              |   |             |   |   |              |  
|Common stock -
      $0.001 par value;                                                                                                                                                                                        |   |             |   |   |              |  
|2,000,000,000
      shares
      authorized,            510,289,721
      and 499,739,721 shares issued
      and            outstanding
      as of June 30, 2010 and December
                 31, 2009,
      respectively |   | 510,290     |   |   | 499,740      |  
|Additional
      paid-in capital                                                                                                                                                                                              |   | 3,077,905   |   |   | 2,737,454    |  
|Stock subscription receivable                                                                                                                                                                                                 |   | (100,000    | ) |   | (100,000     | )
|Retained
      earnings (accumulated deficit)                                                                                                                                                                                 |   | (404,879    | ) |   | 130,510      |  
|Total stockholders equity                                                                                                                                                                                                    |   | 3,083,316   |   |   | 3,267,704    |  
|                                                                                                                                                                                                                              |   |             |   |   |              |  
|Total liabilities and stockholders equity                                                                                                                                                                                    | $ | 4,817,171   |   | $ | 5,200,496    |  

The accompanying notes are an integral part of the unaudited
financial statements.

---

LEXON TECHNOLOGIES, INC.STATEMENTS OF OPERATIONS(Unaudited)

|                                                    |   | Three Months Ended |   |   | Six Months Ended |  
|--------------------------------------------------- | - | ------------------ | - | - | ---------------- | -
|                                                    |   | June
      30,     |   |   | June
      30,   |  
|                                                    |   | 2010               |   |   | 2009             |  
|                                                    |   |                    |   |   |                  |  
|Net sales                                           | $ | 884,295            |   | $ | 1,511,279        |  
|                                                    |   |                    |   |   |                  |  
|Cost of goods sold                                  |   | 934,004            |   |   | 1,105,020        |  
|                                                    |   |                    |   |   |                  |  
|Gross profits                                       |   | (49,709            | ) |   | 406,259          |  
|                                                    |   |                    |   |   |                  |  
|Selling, general and administrative expenses        |   | 459,955            |   |   | 273,850          |  
|                                                    |   |                    |   |   |                  |  
|Income (loss) from operations                       |   | (509,664           | ) |   | 132,409          |  
|                                                    |   |                    |   |   |                  |  
|Other income (expenses):                            |   |                    |   |   |                  |  
|                                                    |   |                    |   |   |                  |  
|Gain on forgiveness of
      debt                   |   | -                  |   |   | -                |  
|Interest expense                                    |   | (12,983            | ) |   | (11,135          | )
|Net
      other income (expense)                    |   | (12,983            | ) |   | (11,135          | )
|                                                    |   |                    |   |   |                  |  
|Income (loss) before income tax provision           |   | (522,647           | ) |   | 121,274          |  
|                                                    |   |                    |   |   |                  |  
|Provision for income taxes                          |   | -                  |   |   | 3,883            |  
|                                                    |   |                    |   |   |                  |  
|Net income (loss)                                   | $ | (522,647           | ) | $ | 117,391          |  
|                                                    |   |                    |   |   |                  |  
|Earnings per share of common stock  Basic          |   | (0.00              | ) |   | 0.00             |  
|                                                    |   |                    |   |   |                  |  
|Earnings per share of common stock  Diluted        |   | (0.00              | ) |   | 0.00             |  
|                                                    |   |                    |   |   |                  |  
|Weighted average shares of common stock outstanding |   | 546,340,664        |   |   | 34,183,778       |  

The accompanying notes are an integral part of the unaudited
financial statements.

---

LEXON TECHNOLOGIES, INC.STATEMENTS OF CASHFLOWS(Unaudited)

|                                                                                                                     |   | Six Months Ended |  
|-------------------------------------------------------------------------------------------------------------------- | - | ---------------- | -
|                                                                                                                     |   | June
      30,   |  
|                                                                                                                     |   | 2010             |  
|Cash flows from operating activities:                                                                                |   |                  |  
|                                                                                                                     |   |                  |  
|Net income (loss)                                                                                                    | $ | (527,389         | )
|Adjustments to reconcile net income (loss) to net cash            
      provided by (used in) operating activities: |   |                  |  
|                                                                                                                     |   |                  |  
|Bad
      debt expense                                                                                               |   | 32,772           |  
|Depreciation and amortization                                                                                        |   | 134,672          |  
|Gain
      on forgiveness of debt                                                                                    |   | (274,610         | )
|Noncash professional service                                                                                         |   | 30,000           |  
|Changes
      in assets and liabilities:                                                                             |   |                  |  
|Accounts receivable                                                                                                  |   | 93,366           |  
|Inventories                                                                                                          |   | 321,388          |  
|Accounts payable                                                                                                     |   | (8,356           | )
|Accrued expenses                                                                                                     |   | 115,513          |  
|Deferred rent                                                                                                        |   | (10,517          | )
|Other current liabilities                                                                                            |   | 31,213           |  
|Total adjustments                                                                                                    |   | 465,441          |  
|Net cash provided by (used in) operating activities                                                                  |   | (61,948          | )
|                                                                                                                     |   |                  |  
|Cash flows from investing activities:                                                                                |   |                  |  
|                                                                                                                     |   |                  |  
|Note receivable                                                                                                      |   | -                |  
|Due from related
      parties                                                                                       |   | 60,000           |  
|                                                                                                                     |   |                  |  
|Net cash provided by (used in) investing
      activities                                                            |   | 60,000           |  
|                                                                                                                     |   |                  |  
|Cash flows from financing activities:                                                                                |   |                  |  
|                                                                                                                     |   |                  |  
|Payments on notes
      payable                                                                                      |   | (40,339          | )
|Payments on capital lease obligations                                                                                |   | (11,841          | )
|Proceeds from convertible
      bonds                                                                                |   | -                |  
|Issuance of common stock                                                                                             |   | 11,001           |  
|Distributions to
      stockholder                                                                                   |   | (8,000           | )
|Net cash provided by (used in) financing activities                                                                  |   | (49,179          | )
|                                                                                                                     |   |                  |  
|Net increase (decrease) in cash                                                                                      |   | (51,127          | )
|                                                                                                                     |   |                  |  
|Cash and cash equivalents, at the beginning of period                                                                |   | 61,661           |  
|                                                                                                                     |   |                  |  
|Cash and cash equivalents, at the end of period                                                                      | $ | 10,534           |  

The accompanying notes are an integral part of the unaudited
financial statements.

---

LEXON TECHNOLOGIES, INC. STATEMENTS OF CASHFLOWS(Unaudited)

|                                                         |   | Six Months Ended | 
|-------------------------------------------------------- | - | ---------------- | 
|                                                         |   | June
      30,   | 
|                                                         |   | 2010             | 
|Supplemental disclosures:                                |   |                  | 
|Cash paid during the period:                             |   |                  | 
|Income taxes                                             | $ | -                | 
|Interest expense                                         | $ | 20,012           | 
|                                                         |   |                  | 
|Noncash investing and financing activities:              |   |                  | 
|Common stock issued
      for acquisition of intangibles | $ | 310,000          | 

The accompanying notes are an integral part of the unaudited
financial statements.

---

LEXON TECHNOLOGIES, INC.NOTES TO UNAUDITED
FINANCIAL STATEMENTS

Note 1 - 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 had developed and manufactured 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.

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
(LexonKorea) as a wholly-owned subsidiary in Korea for the purpose of entering
into potential business combinations with Korean operating entities. LexonKorea
was reorganized in August 2005, and as a result, the Companys equity share in
LexonKorea was reduced to 10%.

On October 7, 2009, Paragon Toner, Inc. (Paragon), a California
corporation, entered into an Agreement and Plan of Merger (the Merger
Agreement) with the Company whereby the Company issued 347,448,444 shares of
common stock (the Common Stock) of the Company (the Acquisition Shares) to
the shareholders of Paragon, representing approximately 72% of the issued and
outstanding Common Stock after completion of the merger in October 2009. The
effective date of the Merger was October 22, 2009 (Effective Date). The
Company has decided to maintain the name of the predecessor company. The Merger
has been accounted for as a recapitalization of Paragon with Paragon as the
acquirer (reverse merger).

Shortly after the Merger, Lexon Semi was dissolved. The
Companys sole line of business is now in manufacturing, marketing and selling
of recycled monochrome and color toner cartridges for laser printers and other
related devices.

Note 2 - Summary of Significant Accounting Policies

This summary of significant accounting policies of the Company
is presented to assist in understanding the Companys financial statements. The
financial statements and notes are representations of the Companys management,
who is responsible for their integrity and objectivity. These accounting
policies conform to accounting principles generally accepted in the United
States of America and have been consistently applied in the preparation of the
financial statements.

Use of Estimates

The preparation of the financial statements in conformity 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 accompanying notes. Estimates are
primarily used for depreciation of property and equipment, amortization of
intangible assets, allowances for doubtful accounts and inventory valuation.
Actual results could differ from those estimates.

Revenue Recognition

The Company recognizes revenues from product sales when earned.
Specifically, revenue is recognized when persuasive evidence of an arrangement
exists, delivery has occurred (or services have been rendered), the price is
fixed or determinable, and collectability is reasonably assured. Revenue is not
recognized until title and risk of loss have transferred to the customer. The
shipping terms for the majority of the Companys revenue arrangements are FOB
(free on board) destination. Revenue is recorded net of customer returns,
allowances and discounts that occur under arrangements established with
customers.

Cash and Cash Equivalents

The Company considers all highly liquid investments purchased
with original maturities of three months or less to be categorized as cash and cash equivalents.

---

Allowance for Doubtful Accounts

The allowance for doubtful accounts is computed based upon the
managements estimate of uncollectible accounts and historical experience. The
Company performs ongoing credit evaluations of its customers to estimate
potential credit losses. Amounts are written off against the allowance in the
period the Company determines that the receivable is uncollectible.

Inventories

Inventories are stated at the lower of cost or market. Cost is
determined by the first-in, first-out (FIFO) method. Appropriate consideration
is given to obsolescence, slow moving items and other factors in evaluating net
realizable value.

Property and Equipment

Property and equipment are stated at cost. The straight-line
method is used to calculate depreciation over their estimated useful lives
ranging as follows:

Automobile
    3 yearsFurniture & fixture
    5 to 7 yearsLeasehold improvement
    5 yearsMachinery and equipment
    5 years


Leasehold improvements are depreciated to expense over the
shorter of the life of the improvement or the remaining lease term. Capital
expenditures that enhance the value or materially extend the useful life of the
related assets are reflected as additions to property and equipment.
Expenditures for repairs and maintenance are charged to expense as incurred.
Upon a sale or disposition of assets, a gain or a loss is included in the
statement of operations.

Impairment of Long-lived Assets

The Company periodically reviews the recoverability of its
long-lived assets using the methodology prescribed in accounting guidance now
codified as FASB ASC Topic 360, Property, Plant and Equipment.The
Company also reviews these assets for impairment whenever events or changes in
circumstances indicate that the carrying amount of an asset may not be
recoverable. Recoverability of these assets is determined by comparing the
forecasted undiscounted future net cash flows from the operations to which the
assets relate, based on managements best estimates using appropriate
assumptions and projections at the time, to the carrying amount of the assets.
If the carrying value is determined not to be recoverable from future operating
cash flows, the asset is deemed impaired and an impairment loss is recognized
equal to the amount by which the carrying amount exceeds the estimated fair
value of the asset. In managements opinion, no such impairment existed as of
June 30, 2010 and December 31, 2009.

Accrued Expenses

The Companys accrued expenses consist of amounts payable for
salaries, payroll taxes and sales taxes.

Deferred Rent

The Company recognizes rent expense equal to the total of the
payments and free rent received due over the lease term, divided by the number
of months of the lease term applying the straight-line method. The difference
between rent expense recorded and the amount paid is credited or charged to
deferred rent.

Shipping and Handling

Certain shipping and handling fees are charged to customers and
these are classified as revenue. The costs associated with all shipping to
customers are recorded as operating expenses. Shipping expenses for the six
months ended June 30, 2010 and 2009 amounted to $89,002 and $89,859,
respectively.

Income Taxes

The Company elected to be subject to the S corporation
provisions of the Internal Revenue Code for federal and state income tax
purposes effective January 27, 2004. Accordingly, as an S corporation, the
Companys taxable income or losses and applicable tax credits are passed through
to its shareholder and reported on shareholders individual income tax return.
However, the State of California requires S Corporation to pay a state franchise
tax (currently 1.5% on its taxable income).

---

Recent Accounting Pronouncements

In June 2009, the Financial Accounting Standards Board (FASB)
issued Statement of Financial Accounting Standards No. 168,The FASB
Accounting Standards Codification and the Hierarchy of Generally Accepted
Accounting Principles  a replacement of FASB Statement No. 162 (Statement
No. 168). This Statement establishes the FASB Accounting Standards Codification
(the Codification or ASC) as the single source of authoritative GAAP. All
previous GAAP standards have been superseded by the Codification. Rules and
interpretive releases of the U.S. Securities and Exchange Commission (the SEC)
under authority of federal securities laws are also sources of authoritative
GAAP for SEC registrants, and the Codification neither replaces nor affects that
guidance. Statement No. 168 is effective for interim and annual financial
statements issued for periods ending after September 15, 2009, and references to
GAAP in this report have been updated as a result. Subsequent changes to GAAP
will be incorporated into the Codification through the issuance of Accounting
Standards Updates (ASU) rather than FASB Statements, Staff Positions,
Interpretations or Emerging Issues Task Force (EITF) Abstracts. The adoption
of Statement No. 168 did not impact the Companys financial condition, results
of operations or cash flows.

In August 2009, the FASB issued Accounting Standards Update
(ASU) 2009-05, Fair Value Measurements and Disclosures (Topic 820) 
Measuring Liabilities at Fair Value. ASU 2009-05 provides clarification that
in circumstances in which a quoted price in an active market for the identical
liability is not available, a reporting entity is required to measure fair value
of such liability using one or more of the techniques prescribed by the update.
The adoption of this guidance is not expected to have a material impact on the
Companys financial position, results of operations or cash flow.

In April 2008, the FASB issued staff position FSP FAS 142-3
(FSP 142-3), "Determination of the Useful Life of Intangible Assets", and has
subsequently been codified under FASB ASC 350-30-35, "Determining the Useful
Life of an Intangible Asset" and is hereon referred to as ASC 350-30-35, amends
the factors that should be considered in developing renewal or extension
assumptions used to determine the useful life of a recognized intangible asset.
The intent of ASC 350-30-35 is to improve the consistency between the useful
life of a recognized intangible asset and the period of expected cash flows used
to measure the fair value of the asset as outlined by the U.S. generally
accepted accounting principles (GAAP). ASC 350-30-35 is effective for fiscal
years beginning after December 15, 2008 and interim periods within those fiscal
years and should be applied prospectively to intangible assets acquired after
the effective date. Early adoption is prohibited. The Company does not expect
this to have an impact on its results of operations, financial position or cash
flows at the date of adoption, but it could have a material impact on its
results of operations, financial position or cash flows in future periods.

Business Combinations" (ASC 805) (formerly SFAS No. 141 and
its revision 141(R)) changes how business acquisitions are accounted for and
will impact financial statements both on the acquisition date and in subsequent
periods. ASC 805 as it relates to recognizing all (and only) the assets acquired
and liabilities assumed in a business combination, costs an acquirer expects but
it not obligated to incur in the future to exit an activity of an acquiree or to
terminate or relocate an acquiree's employees are not liabilities at the
acquisition date but must be expensed in accordance with other applicable
generally accepted accounting principles. Additionally, during the measurement
period, which should not exceed one year from the acquisition date, any
adjustments that are needed to assets acquired and liabilities assumed to
reflect new information obtained about facts and circumstances that existed as
of that date will be adjusted retrospectively. The acquirer will be required to
expense all acquisition-related costs in the periods such costs are incurred
other than costs to issue debt or equity securities. ASC 805 will have no impact
on the Companys results of operations, financial position or cash flows at the
date of adoption, but it could have a material impact on the Companys results
of operations, financial position or cash flows in the future when it is applied
to acquisitions which occur in the fiscal year beginning after November 1,
2009.

In April 2009, the FASB issued new guidance codified primarily
in ASC Topic 825, Financial Instruments. This guidance requires an entity to
provide disclosures about fair value of financial instruments in interim
financial information and is to be applied prospectively and is effective for
interim and annual periods ending after June 15, 2009 with early adoption
permitted for periods ending after March 15, 2009. The adoption of this guidance
did not have a material impact on the consolidated financial statements. Refer
to Note 5, Fair Value of Financial Instruments, for the disclosures required
in accordance with this guidance.

In May 2009, the FASB issued authoritative guidance
establishing general standards of accounting for and disclosure of events that
occur after the balance sheet date but before financial statements are issued.
This guidance, which was incorporated into ASC Topic 855, "Subsequent
Events", was effective for interim or annual periods ended after June 15,
2009, and the adoption did not have any impact on the Company's financial
statements.

Note 3 - Merger

On October 7, 2009, Paragon Toner, Inc. (Paragon), a California
corporation, entered into an Agreement and Plan of Merger (the Merger
Agreement) with the Company whereby the Company issued 347,448,444 shares of
common stock (the Common Stock) of the Company (the Acquisition Shares) to
the shareholders of Paragon, representing approximately 72% of the issued and
outstanding Common Stock after completion of the merger in October 2009. The
effective date of the Merger was October 22, 2009 (Effective Date). The
Company has decided to maintain the name of the predecessor company. The Merger
has been accounted for as a recapitalization of Paragon with Paragon as the
acquirer (reverse merger).

---

Note 4 - Inventories

The following table provides the components of inventories as
of June 30, 2010 and December 31, 2009:

June 30,
    
    
      December 31,2010
    
    
      2009Finished goods
    $
      261,020
    
    $
      582,603Raw materials
    
      281,214
    
    
      290,603542,234
    
    
      873,206Less: Inventory reserve
    
      (25,402
    )
    
      (34,986
    )Total
    $
      516,832
    
    $
      838,220


Overhead allocated to the inventory amounted to $31,353 and
$10,436 for the six months ended June 30, 2010 and 2009, respectively.

Note 5- Property and Equipment

Property and equipment consist of the following as of June 30,
2010 and December 31, 2009:

June 30,
    
    
      December 31,2010
    
    
      2009Automobile
    $
      34,092
    
    $
      34,092Furniture and fixture
    
      53,388
    
    
      53,388Leasehold improvement
    
      5,060
    
    
      5,060Machinery and equipment
    
      439,030
    
    
      439,030531,570
    
    
      531,570Less: Accumulated depreciation
    
      (448,252
    )
    
      (419,178
    )Net property and equipment
    $
      83,318
    
    $
      112,392


Depreciation expense amounted to $29,074 and $44,032 for the
six months ended June 30, 2010 and 2009, respectively.

Note 6 - Capitalized Website Costs

The Company amortizes its website over the estimated useful
life of three years. Amortizable intangible assets are tested for impairment
when impairment indicators are present, and, if impaired, written down to fair
value based on either discounted cash flows or appraised values. No impairment
of website costs has been identified during the periods presented. The carrying
amount and accumulated amortization related to the website costs as of June 30,
2010 and December 31, 2009, are as follows:

June 30,
    
    
      December 31,2010
    
    
      2009Gross balance
    $
      633,589
    
    $
      323,589Less: Accumulated amortization
    
      (152,822
    )
    
      (47,224
    )Net balance
    $
      480,767
    
    $
      276,365


Estimated aggregate amortization expense for each of the
succeeding years is as follows:

Years ending December 31,
    
    
    
    
    AmountRemainder
      of 2010
    
    
    
    $
    104,8242011
    
    
    
    
    195,6672012
    
    
    
    
    180,276Total
    
    
    
    $
    480,767


Total amortization expenses were $105,598 and $7,765 for the
six months ended June 30, 2010 and 2009, respectively.

---

Note 7 - Transactions with Related Parties

Due from Related Parties

Advances to family members of the stockholder are unsecured,
non-interest bearing and due on demand. The Company has $130,000 and $190,000
due from related parties as of June 30, 2010 and December 31, 2009,
respectively.

Due to Related Parties

Interest bearing notes payable to related parties consisting of
the following as of June 30, 2010 and December 31, 2009:

June 30,
    
    
      December 31,2010
    
    
      2009Unsecured 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


Note 8- Line of Credit

The Company has a line of credit with a bank with a maximum
borrowing limit of $450,000. The outstanding balance was $450,000 as of both
June 30, 2010 and December 31, 2009. This line of credit matures on September 7,
2010 and is secured by the Companys accounts receivable, inventory and other
miscellaneous assets. Interest is accrued at the banks prime plus 1.00% (5.50%
as of June 30, 2010).

The Company incurred interest expenses on this line of credit
  of $11,098and $13,244 for the six months ended June 30, 2010 and 2009, respectively.

Note 9 - Notes Payable

The Company has long term notes payable as follows:

June 30,
    
    
      December 31,2010
    
    
      2009A note payable to a bank, due
      in monthly installments of $2,931, including interest at the banks prime
      plus 1.25% (4.50% as of June 30, 2010). The note matures in May 2011, and
      is collateralized by substantially all the assets of the Company. The note
      is subject to various restrictive covenants, including maintenance of
      financial ratios at all times.
    $
      31,517
    
    $
      48,162A note payable to a bank, due
      in monthly installments of $4,587, including interest at the banks prime
      plus 1.50% with minimum interest rate of 6.25% (6.25% as of June 30,
      2010). The note matures in January 2012, and is collateralized by
      substantially all the assets of the Company.
    
      107,156
    
    
      130,850Unsecured 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 11,
      the creditor has filed suit to collect on this note.
    
      149,982
    
    
      149,982Total notes payable
    
      308,655
    
    
      348,994Less: Current portion
    
      (251,260
    )
    
      (249,534
    )Notes payable, net of current
    $
      57,395
    
    $
      99,460


---

Maturities of notes payable as of June 30, 2010 are as follows:

Years ending December 31,
    
    
    
    
    Amount2010
    
    
    
    $
    209,1952011
    
    
    
    
    66,5672012
    
    
    
    
    32,893Total
    
    
    
    $
    308,655


Total interest expense on the notes payable were $4,655 and
$2,857 for the six months ended June 30, 2010 and 2009, respectively.

Note 10 - Capital Lease Obligations

The Company entered into numerous capital lease agreements with
leasing companies to purchase certain equipment and transportation vehicles. As
of June 30, 2010 and December 31, 2009, these assets are carried as follows:

June 30,
    
    
      December 31,2010
    
    
      2009Equipment
    $
      162,889
    
    $
      162,889Transportation vehicles
    
      32,800
    
    
      32,800Less: Accumulated
      depreciation
    
      (184,992
    )
    
      (179,643
    )$
      10,697
    
    $
      16,046


The related future minimum lease payments under the capital
lease obligations are as follows:

June 30,
    
    
      December 31,2010
    
    
      2009Total minimum lease payments
    $
      46,556
    
    $
      62,752Less: Amount representing interest
    
      (7,948
    )
    
      (12,303
    )Present value of net minimum
      lease payments
    
      38,608
    
    
      50,449Less: Current portion
    
      (21,082
    )
    
      (21,888
    )Capital lease obligations,
      net of current portion
    $
      17,526
    
    $
      28,561


Maturities of capital lease obligations as of June 30, 2010,
are as follows:

Years ending December 31,
    
    
    
    
    AmountRemainder
      of 2010
    
    
    
    $
    10,0472011
    
    
    
    
    20,4472012
    
    
    
    
    8,114Total
    
    
    
    $
    38,608


Total interest expenses from the capital lease obligations were
$4,259 and $7,444 for the six months ended June 30, 2010 and 2009, respectively.

Note 11 - Commitments and Contingencies

Legal Proceedings

On July 14, 2008, Advanced Digital Technology Co. Ltd., a
Korean corporation (ADT), filed a claim against Lexon and certain named
individuals who are former and current officers of the Company. The claim
alleges breach of an agreement to settle an earlier dispute, involving ADT's
investment of $150,000 in Lexon on or about January 16, 2007 and ADT's
subsequent unilateral decision to rescind and demand a refund of this investment. The total
amount of damages claimed under the pending lawsuit is the investment amount of
$150,000 plus filing costs, interest and attorney fees for an aggregate amount
of $178,522. On or about May 2, 2009, Lexon became aware of a default judgment
entered in the amount above. Such judgment was entered on December 22, 2009. On
or about May 8, 2009, Lexon has retained the law firm of Smith, Chapman &
Campbell for the purpose of setting aside the default judgment as the Company
was never in receipt of the notice of default entry. On or about July 21, 2009,
the court set aside the default as the court agreed that service was never
properly served.

---

On September 5, 2008, Vivien and David Bollenberg, a current
shareholder (the Bollenbergs), filed a claim against Lexon and other third
parties, including ByungHwee Hwang (also referred to as "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 allege that they invested a total of $1,500,000 among and
between the various companies and ventures recommended by 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 final disposition of this case has not yet been resolved.

Operating lease

The Company leases its warehouse and office from a
non-affiliate. Future minimum rental payments under these leases as of June 30,
2010, are as follows:

Years ending December 31,
    
    AmountRemainder
      of 2010
    $
    137,2562011
    
    279,6192012
    
    23,301Total
    $
    440,176


Rent expenses amounted to $122,424 and $125,462 for the six
months ended June 30, 2010 and 2009, respectively. The Company allocated
$114,370 and $114,933 of rent expenses to cost of goods sold for the six months
ended June 30, 2010 and 2009, respectively.

Note 12 - Dissolution of Subsidiary

As discussed in Note 1, on October 29, 2009, the subsidiary,
Lexon Semiconductor Corporation was formally dissolved with the approval of the
City of Pyongtaek in Korea. The subsidiary had been previously classified as a
discontinued operation. With the dissolution, the Company recognized a
forgiveness of debt totaling $418,970.

Note 13 - Distributions to Stockholder

Prior to the Merger described in Note 3, Paragon operated as a
private S Corporation. As such, Paragon made periodic distribution to the sole
stockholder at the time. Distributions paid to the stockholder aggregated $8,000
and $56,310 for the six months ended June 30, 2010 and 2009.

Note 14 - Income Taxes

Significant components of deferred tax assets are as follows:

June 30,
    
    
      December 31,2010
    
    
      2009Loss carry forwards
    $
      2,056,904
    
    $
      1,602,904Other
    
      229,720
    
    
      229,720Total deferred tax asset
    
      2,286,624
    
    
      1,832,624Valuation allowance
    
      (2,286,624
    )
    
      (1,832,624
    )Total deferred tax asset, net
    $
      -
    
    $
      -


---

As of June 30, 2010, the Company had approximately $4,100,000 of net operating loss (NOL) carryforwards for U.S. federal income tax purposes expiring in 2020 through 2030. In addition, the Company has California state NOL
carryforwards of approximately $2,900,000 expiring in 2013 through 2020.

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 $454,000 during the six months ended June 30, 2010.

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.

Note 15 - Subsequent Events

The Company has evaluated all subsequent events to the balance sheet date of December 31, 2009 through the date that the financial statements were issued on August, 19 2010, and has determined that there are no subsequent events that require
disclosure under FASB Accounting Standards Codification Topic 855, Subsequent Events.

---

ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS

The following discussion and analysis should be read in
conjunction with our financial statements, including the notes thereto,
appearing elsewhere in this Report.

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.

Results of Operation for the Three Months Ended June 30,
2010 as Compared to the Three Months Ended June 30, 2009

Revenues.

Revenues decreased by $626,984 to $884,295 for the three months
ended June 30, 2010 as compared to $1,511,279 for the three months ended June
30, 2009. This decline was primarily attributed to a sharp decrease in sales
caused by the downturn in the economy.

Cost of Goods Sold.

Cost of Goods Sold decreased by $ 171,016 to $934,004 for the
three months ended June 30, 2010 as compared to $1,105,020 for the three months
ended June 30, 2009.

Selling, General and Administrative Expenses.

Selling, General and Administrative Expenses (SG&A)
increased by $186,105 to $459,955 for the three months ended June 30, 2010 as
compared to $273,850 for the three months ended June 30, 2009. This increase of
$186,105 in SG&A was attributed to professional services and filing expenses
related to our public listing on the OTC Bulletin Board and increased sales and
marketing efforts, including efforts to increase our Internet related direct
sales.

Other Income and Expenses.

Other expenses, which entirely composed of interest expenses,
for the three months ended June 30, 2010 was $12,983 compared with other
expenses of $11,135 for the three months ended June 30, 2009

Net income.

As a result, we recorded a net loss of $522,647 for the three
months ended June 30, 2010 compared with a net income of $117,391 for the three
months ended June 30, 2009.

Results of Operation for the Six Months Ended June 30, 2010
as Compared to the Six Months Ended June 30, 2009

Revenues.

Revenues decreased by $760,454 to $2,214,577 for the six months
ended June 30, 2010 as compared to $2,975,031 for the the six months ended June
30, 2009. This decline was primarily attributed to a sharp decrease in sales
caused by the downturn in the economy.

Cost of Goods Sold.

Cost of Goods Sold decreased by $ 173,117 to $1,975,554 for the
six months ended June 30, 2010 as compared to $2,148,671 for the six months
ended June 30, 2009.

Selling, General and Administrative Expenses.

Selling, General and Administrative Expenses (SG&A)
increased by $432,945 to $1,011,076 for the six months ended June 30, 2010 as
compared to $578,131 for the six months ended June 30, 2009. This increase of
$432,944 in SG&A was attributed to professional services and filing expenses
related to our public listing on the OTC Bulletin Board and increased sales and
marketing efforts, including efforts to increase our Internet related direct
sales.

Other Income and Expenses.

Other income for the six months ended June 30, 2010 was
$244,664 compared with other expenses of $23,545 for the six months ended June
30, 2009. The other income for the six months ended June 30, 2010 was primarily
attributed to $274,610 in gains from the extinguishment of a debt obligation.
Interest expenses for the six months ended June 30, 2010 was $29,946 compared to
$23,545 in
interest expenses for the six months ended June 30, 2010.

---

Net income.

As a result, we recorded a net loss of $527,389 for the six months ended June 30, 2010 compared with a net income of $220,801 for the six months ended June 30, 2009.

Liquidity and Capital Resources.

At June 30, 2010, we had current assets of $884,049 and current liabilities of $1,616,053. Current assets consisted primarily of accounts receivable and inventories.

Current liabilities at June 30, 2010, consisted of accounts payable of $544,278, due to related parties of $91,960, credit line of $450,000, accrued expenses of $226,260, notes payable of $251,260 and capital lease obligations of
$21,082.

For the six months ended June 30, 2010, net cash used in operating activities totaled $61,948 compared to net cash provided by operating activities of $40,382 in the prior year period. Our operating activities since inception have been
funded primarily by income organically generated by the company and by the limited sale of our common stock.

Net cash provided by investing activities for the six months ended June 30, 2010 amounted to $60,000 compared to net cash used in investment activities of $82,930 for the same previous year period.

Net cash used in by financing activities for the six months ended June 30, 2010 was $49,179 compared to net cash provided of$77,413 for the six months ended June 30, 2009. This decrease in net cash provided by financing activities was
largely attributed to $11,000 in issuance of common stock and a decline of $8,000 in distributions to shareholders.

Net cash and cash equivalents at June 30, 2010 was $10,354.

None.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

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

ITEM 4. CONTROLS AND PROCEDURES

Our Chief Executive Officer, President, and Chief Financial Officer (the Certifying Officer) is responsible for establishing and maintaining disclosure controls and procedures for the Company. The Certifying Officer has 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 Officer has evaluated the effectiveness of the Company's disclosure
controls and procedures within 90 days of the date of this report and believes that the Companys disclosure controls and procedures are effective based on the required evaluation. There have been no significant changes in internal controls or
in other factors that could significantly affect internal controls subsequent to the date of their evaluation, including any corrective actions with regard to significant deficiencies and material weaknesses.

ITEM 4T. CONTROLS AND PROCEDURES

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

---

PART II

ITEM 1. 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
Korean corporation (ADT), filed a claim against Lexon and certain named
individuals who are former and current officers of the Company. The claim
alleges breach of an agreement to settle an earlier dispute, involving ADT's
investment of $150,000 in Lexon on or about January 16, 2007 and ADT's
subsequent unilateral decision to rescind and demand a refund of this
investment. The total amount of damages claimed under the pending lawsuit is the
investment amount of $150,000 plus filing costs, interest and attorney fees for
an aggregate amount of $178,522. On or about May 2, 2009, Lexon became aware of
a default judgment entered in the amount above. Such judgment was entered on
December 22, 2009. On or about May 8, 2009, Lexon has retained the law firm of
Smith, Chapman & Campbell for the purpose of setting aside the default
judgment as the Company was never in receipt of the notice of default entry. On
or about July 21, 2009, the court set aside the default as the court agreed that
service was never properly served. We are currently in the discovery stage of
the proceedings.

On September 5, 2008, Vivien and David Bollenberg, a current
shareholder (the Bollenbergs), filed a claim against Lexon and other third
parties, including ByungHwee Hwang (also referred to as "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 allege that they invested a total of $1,500,000 among and
between the various companies and ventures recommended by 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 final disposition of this case has not yet been resolved.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF
PROCEEDS

None

ITEM 3. DEFAULT UPON SENIOR SECURITIES

None.

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

None.

ITEM 5. OTHER INFORMATION

None.

ITEM 6. EXHIBITS

|Exhibit 31.1 | CERTIFICATION
        OF CHIEF EXECUTIVE OFFICER PURSUANT TO THE SECURITIES EXCHANGE ACT OF
        1934, RULES 13(A)-14 AND 15(D)-14, AS ADOPTED PURSUANT TO SECTION 302
        OF THE SARBANES-OXLEY ACT OF 2002.
|------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|             |                                                                                                                                                                                                                     
|Exhibit 31.2 | CERTIFICATION
        OF CHIEF FINANCIAL OFFICER PURSUANT TO THE SECURITIES EXCHANGE ACT OF
        1934, RULES 13(A)-14 AND 15(D)-14, AS ADOPTED PURSUANT TO SECTION 302
        OF THE SARBANES-OXLEY ACT OF 2002.
|             |                                                                                                                                                                                                                     
|Exhibit 32   | CERTIFICATION
        PURSUANT TO 18 U.S.C. SECTION 1350, AS ADOPTED PURSUANT TO SECTION 906
        OF THE SARBANES-OXLEY ACT OF 2002.                                                                             

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: August 19, 2010 | By:                     
|                      |                         
|                      |                         

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.

---