Exhibit 10.1

EMPLOYMENT AGREEMENT

This Employment Agreement (“Agreement”) is made and entered into as of
October 20, 2006 by and between Murray Kawchuk (“Kawchuk”) and Axesstel, Inc., a
Nevada corporation (“Axesstel”), with respect to the following facts:

A. Axesstel wishes to employ Kawchuk as Senior Vice President of Sales and
Corporate Marketing of Axesstel, and Kawchuk wishes to be employed as Senior
Vice President of Sales and Corporate Marketing of Axesstel.

B. Axesstel and Kawchuk wish to set forth in this Agreement the terms and
conditions under which Kawchuk is to be employed by Axesstel.

NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency
of which are hereby mutually acknowledged, Axesstel and Kawchuk hereby agree as
follows:

1. Employment

1.1 Title. Axesstel hereby employs Kawchuk as Senior Vice President of Sales and
Corporate Marketing of Axesstel, and Kawchuk shall have the duties,
responsibilities and authority consistent with such position as described in
Section 1.1 hereof.

1.2 Duties. For so long as he is employed hereunder, Kawchuk (i) shall devote
his full professional time and attention, best efforts, energy and skills to the
services required of him as an employee of Axesstel, except for paid time off
taken in accordance with Axesstel’s policies and practices and subject to
Axesstel’s existing policies pertaining to reasonable periods of absence due to
sickness, personal injury or other disability and outside activities authorized
under Section 2.1 below; (ii) shall use his best efforts to promote the
interests of Axesstel; (iii) shall comply with all applicable governmental laws,
rules and regulations and with all of Axesstel’s policies, rules and/or
regulations applicable to the employees of Axesstel; and (iv) shall discharge
his responsibilities in a diligent and faithful manner, consistent with sound
business practices and in accordance with the directives of the CEO and the
Board of Directors of Axesstel. Kawchuk shall report directly to Axesstel’s CEO.
Kawchuk’s primary responsibilities during his employment with Axesstel shall be
to (a) manage all of Axesstel’s sales and corporate marketing activities; (b) be
responsible for top line revenue results for the corporation, and (c) perform
any other duties assigned to him by Axesstel’s CEO.

1.3 At Will Employment. Executive’s employment under this Agreement shall be “at
will”. The employment relationship between Axesstel and Kawchuk may be
terminated by Kawchuk or by Axesstel at any time, with or without cause.

1.4 Location. Kawchuk acknowledges that Axesstel’s principal executive offices
are located in San Diego, California. Kawchuk’s principal place of employment
shall be located in Texas. Axesstel shall provide Kawchuk with administrative
support, on a shared basis, out of its offices in San Diego, California. Kawchuk
agrees that he will be present at Axesstel’s principal executive offices as
necessary to carry out his assigned responsibilities.

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Kawchuk acknowledges that he may be required to travel from time to time in the
course of performing his duties.

1.5 Life Insurance. If requested by Axesstel to do so, Kawchuk will cooperate
with Axesstel’s efforts to procure a term life insurance policy on Kawchuk.

2. Outside Activities

2.1 Outside Activities. During the period of his employment, Kawchuk may serve
on boards of directors (or similar body) of other business entities, or provide
advisory and other services thereto; provided, that such activities do not
interfere with the effective discharge of his duties and responsibilities to
Axesstel, the nature of such service is disclosed to the Board of Directors of
Axesstel and the Board consents to Kawchuk’s rendering such service, which
consent shall not be unreasonably withheld or delayed. Axesstel acknowledges
that Kawchuck currently serves on the Advisory Board of Magnolia Broadband, Inc.
and hereby consents to that service

2.2 Investment. Nothing in this Article 2 shall be construed as preventing
Kawchuk from engaging in the investment of his personal assets so long as such
investment activity does not require: (1) any participation on Kawchuk’s part in
the operation or the affairs of the enterprise or enterprises in which such
investments are made or (2) the rendering of any services by Kawchuk to any such
enterprise.

3. Compensation

3.1 Sign on Bonus. On the effectiveness of this Agreement, Axesstel will pay to
Kawchuk a sign on bonus of $50,000 less applicable withholding taxes. In the
event that Kawchuk voluntarily terminates his employment with Axesstel prior to
the one year anniversary of this Agreement, then Kawchuk shall repay to Axesstel
the full amount of the sign on bonus.

3.2 Base Salary. Axesstel shall pay Kawchuk an annual base salary of two hundred
and fifty thousand dollars ($250,000) less applicable withholding taxes (“Base
Salary”). Base Salary payments will be made to Kawchuk in accordance with
Axesstel’s pay period practices.

3.3 Performance Bonus. During the period of his employment, Kawchuk shall be
eligible to receive a performance bonus (“Performance Bonus”) in a target amount
equal to two hundred and fifty thousand dollars ($250,000) per annum, based on
the attainment of 100% of personal and company results to be established by the
CEO of Axesstel. The Performance Bonus will be payable quarterly or
semi-annually based on the specific personal and company results established by
the CEO of Axesstel. Notwithstanding the foregoing, the parties agree that
Kawchuk shall have earned and shall be paid his Performance Bonus for the period
from the inception of his employment through the end of the first fiscal quarter
of 2007 in an amount equal to the pro rata portion of the Performance Bonus at
100% of the annual target amount. Kawchuk shall be eligible for additional
performance based bonus, in the event that the performance exceeds 100% of
established goals.

 

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3.4 Car Allowance. Axesstel shall pay Kawchuk a car allowance of $1,000 per
month that will be included in the normal salary payments and is subject to all
normal withholding taxes.

3.5 Membership Dues. During the period of his employment, Axesstel shall pay for
the monthly dues, but not any initiation fees, for membership in the Sports
Club, currently approximately $600 per month.

3.6 Adjustment. Kawchuk’s Base Salary and Performance Bonus shall be subject to
annual increases on or about the anniversary of this Agreement. Increases, if
any, shall be at the sole discretion of the CEO and the Board of Directors of
Axesstel.

4. Benefits. During his employment, Kawchuk shall accrue and be entitled to take
paid vacation in accordance with Axesstel’s vacation policies in effect from
time to time, including Axesstel’s policies regarding vacation accruals;
provided that Kawchuk’s rate of vacation accrual during the Period of Employment
shall be no less than three (3) weeks per year. Notwithstanding the foregoing,
Kawchuk shall cease to accrue further vacation at any time that Kawchuk has an
unused vacation accrual of four (4) weeks. Kawchuk shall also be entitled to all
other holiday and leave pay generally available to other executives of Axesstel.
During his employment, Kawchuk shall be entitled to participate in all employee
benefit, group health and life insurance, retirement, 401(k) and other benefit
plans of Axesstel under the terms and conditions of such plan or programs.

5. Stock Options. On the effective date of this Agreement, Kawchuk shall be
granted Options to purchase 400,000 shares of Axesstel’s Common Stock under
Axesstel’s 2004 Equity Incentive Plan at the fair market value of such Common
Stock as of the close of business on the first day of employment pursuant to the
terms of a stock option agreement in the form attached hereto as Exhibit A.

6. Business Expenses. Upon presentation of appropriate documentation, Axesstel
shall reimburse Kawchuk for reasonable, out-of-pocket business expenses incurred
by Kawchuk in the course of his performance of his duties hereunder, including
entertainment expenses incurred at the Sports Club related to Axesstel’s
business in accordance with Axesstel’s expense reimbursement policy. Kawchuk
will submit monthly expense reports for approval by the Chief Executive Officer
or Chief Financial Officer of Axesstel. Kawchuk will initially work out of a
home office and Axesstel will reimburse Kawchuk reasonable expenses related to
the organization and set up of that office, including without limitation,
telephone and Internet service, a laptop, cell phone and personal digital
assistant.

7. Former Employment

7.1 No Conflict. Kawchuk represents and warrants that the execution and delivery
by him of this Agreement, his employment by Axesstel and his performance of
duties under this Agreement will not conflict with and will not be constrained
by any prior employment or consulting agreement or relationship, or any other
contractual obligations.

7.2 No Use of Prior Confidential Information. Kawchuk will not intentionally
disclose to Axesstel or use on its behalf any confidential information belonging
to any of his

 

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former employers, but during his employment by Axesstel he will use in the
performance of his duties all information (but only such information) which is
generally known and used by persons with training and experience comparable to
his own or is common knowledge in the industry or otherwise legally in the
public domain.

8. Non-Solicitation; Confidentiality; Remedies

8.1 No Solicitation. During the Restricted Period (as defined below), neither
Kawchuk nor any Executive-Controlled Person (as defined below) will, without the
prior written consent of Axesstel’s Board of Directors, directly or indirectly
solicit for employment, or make an unsolicited recommendation to any other
person that it employs or solicit for employment any person who is or was, at
any time during the Restricted Period, an officer, executive, employee, agent or
representative of Axesstel or of any affiliate of Axesstel. As used in this
Agreement, the term “Executive-Controlled Person” shall mean any company,
partnership, firm or other entity as to which Kawchuk possesses, directly or
indirectly, the power to direct or cause the direction of the management and
policies of such entity, whether through the ownership of voting securities, by
contract or otherwise.

8.2 Confidentiality.

8.2.1 Kawchuk acknowledges that, as a result of his status as Vice President of
Sales and Corporate Marketing of Axesstel, he has, or will have, access to and
possession of important confidential information and knowledge as to the
business of Axesstel and its affiliates, including, hut not limited to knowledge
of products of Axesstel and its affiliates, patents, technology, know-how,
marketing and operating strategies, licensing and other agreements, financial
results and projections, future plans, the provisions of other important
contracts entered into by Axesstel and its affiliates, possible acquisitions and
similar information. Kawchuk agrees that such knowledge and information
constitutes a vital part of the business of Axesstel and are by their nature
trade secrets and confidential information proprietary to Axesstel (collectively
“Confidential Information”). Kawchuk agrees that he shall not divulge,
communicate, furnish or make accessible (whether orally or in writing or in
books, articles or any other medium) to any individual, firm, partnership or
corporation, any Confidential Information without the consent of Axesstel’s
Board of Directors. As used in this Agreement, the term, “Confidential
Information” shall not include any knowledge or information that Kawchuk can
demonstrate: (i) is or becomes available to others, other than as a result of
breach by Kawchuk of this Article 8; (ii) was available to Kawchuk on a
nonconfidential basis prior to its disclosure to Kawchuk through his status as
an officer or employee of Axesstel; or (iii) becomes available to Kawchuk on a
nonconfidential basis from a third party (other than Axesstel, its affiliates
and any of their representatives) who is not bound by any confidentiality
obligations to Axesstel or any of its affiliates. Kawchuk understands and agrees
that he must also execute and fully comply with Axesstel’s Employee Innovations
and Proprietary Rights Assignment Agreement in the form attached hereto as
Exhibit B as a condition of his employment.

8.2.2 All memoranda, notes, lists, records and other documents or papers (and
all copies thereof), including such items stored in computer memories, on
microfiche or by any other means, made or compiled by or on behalf of Kawchuk or
made available to him

 

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relating to Axesstel or any of its affiliates are and shall remain Axesstel’s
property, and shall be delivered to Axesstel promptly upon any termination of
Kawchuk’s employment with Axesstel, or at any other time on request, and such
information shall be held confidential by Kawchuk after any termination of’ his
employment with Axesstel.

8.3 No Competition During Employment. During the term of this Agreement, neither
Kawchuk nor any Executive-Controlled Person will, without the prior written
consent of Axesstel’s Board of Directors, render any services, directly or
indirectly, as an employee, officer, consultant or in any other capacity, to any
individual, firm, corporation or partnership engaged in any business or activity
which directly competes with the business activities of Axesstel.

8.4 Restricted Period. As used in this Agreement, “Restricted Period” shall mean
any period during which Kawchuk is employed by Axesstel and a period of two
(2) years after the Termination Date.

8.5 Remedies. Kawchuk agrees that the provisions of’ this Article 8 are
reasonable and necessary for the protection of Axesstel and that they may not be
adequately enforced by an action for damages. Therefore, in the event of a
breach or threatened breach of this Article 8 by Kawchuk or any
Executive-Controlled Person, Axesstel shall be entitled, in addition to all
other remedies, to an injunction and/or restraining order enjoining the breach
or threatened breach of the provisions of Article 8 or otherwise to enforce
specifically such provisions against violation, without the necessity of posting
any bond or other security by Axesstel. Kawchuk further agrees that if he shall
violate any of the covenants and agreements under this Article 8, Axesstel shall
be entitled to an accounting and repayment of all profits, commissions or other
benefits which Kawchuk has realized and/or may realize as a result of or arising
out of any such violation. Such remedy shall be cumulative and not exclusive and
in addition to any injunctive relief or other legal or equitable remedy to which
Axesstel is or may be entitled. In addition, the prevailing party shall also he
entitled to its reasonable attorneys’ fees and costs incurred in any action in
which it is successful in establishing or defending against an alleged violation
of Article 8.

8.6 Severability. The provisions contained in this Article 8 as to the time
periods, scope of activities and persons or entities affected shall be deemed
severable so that, if any provision contained in this Article 8 is determined to
be invalid or unenforceable, such provisions shall be deemed modified so as to
be valid and enforceable to the full extent permitted by law.

9. General Provisions

9.1 Governing Law. This Agreement and the rights of the parties thereunder shall
be governed by and interpreted under California law.

9.2 Assignment. Kawchuk may not delegate, assign, pledge or encumber his rights
or obligations under this Agreement or any part thereof.

9.3 Notice. Any notice required or permitted to be given under this Agreement
shall be sufficient if it is in writing and is sent by registered or certified
mail, postage

 

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prepaid, or personally delivered, to the following addresses, or to such other
addresses as either party shall specify by giving notice under this Article 9:

 

To Axesstel:    Axesstel, Inc.    6815 Flanders Drive, Suite 210    San Diego,
CA 92121    Attn: CEO    T: (858) 625-2100    F: (858) 625-2110 With a copy to:
   James A. Mercer III, Esq.    Duane Morris LLP    101 W. Broadway, Suite 900
   San Diego, CA 92101    T: (619) 744-2209    F: (619) 744-2201    Email:
jamercer@duanemorris.com To Kawchuk:    Murray Kawchuk    606 Durango Circle N.
   Irving, TX 75062    T:    F:    Email:

9.4 Entire Agreement. This Agreement (and its Exhibits) constitutes the entire
agreement between the parties pertaining to the subject matter hereof and
completely supersedes all prior or contemporaneous agreements, understandings,
arrangements, commitments, negotiations and discussions of the parties, whether
oral or written (all of which shall have no substantive significance or
evidentiary effect). Each party acknowledges, represents and warrants that this
Agreement is fully integrated and not in need of parole evidence in order to
reflect the intentions of the parties.

9.5 Amendment. This Agreement may be waived, amended or supplemented only by a
writing signed by both of the parties hereto.

9.6 Waiver. No waiver of any provision of’ this Agreement shall be binding
unless and until set forth expressly in writing and signed by the waiving party.
The waiver by either party of’ a breach of’ any provision of this Agreement
shall not operate or be construed as a waiver of any preceding or succeeding
breach of the same or any other term or provision, or a waiver of any
contemporaneous breach of any other term or provision, or a continuing waiver
of’ the same or any other term or provision. No failure or delay by a party in
exercising any right, power, or privilege hereunder or other conduct by a party
shall operate as a waiver thereof in the particular case or in any past or
future case, and no single or partial exercise thereof shall preclude the full
exercise or further exercise of any right, power or privilege. No action taken

 

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pursuant to this Agreement shall be deemed to constitute a waiver by the party
taking such action of compliance with any representations, warranties, covenants
or agreements contained herein.

9.7 Severability. All provisions contained herein are severable and in the event
that any of them shall be held to be to any extent invalid or otherwise
unenforceable by any court of competent jurisdiction, such provision shall be
interpreted, construed or rewritten so as to effectuate to the greatest possible
extent the parties’ expressed intent; and in every case the remainder of this
Agreement shall not be affected thereby and shall remain valid and enforceable,
as if such affected provision were not contained herein,

9.8 Construction. Article and section headings are inserted herein for
convenience of reference only and in no way are to be construed to define, limit
or affect the construction or interpretation of the terms of this Agreement. The
provisions of this Agreement have been prepared, examined, negotiated and
revised by each party hereto, and no implication shall be drawn and no provision
shall be construed against either party by virtue of the purported identity of
the drafter of this Agreement, or any portion thereof.

9.9 Arbitration. The parties agree that any and all disputes that they have with
one another which arise out of Kawchuk’s employment or under the terms of this
Agreement shall be resolved through final and binding arbitration, as specified
herein. This shall include, without limitation, disputes relating to this
Agreement, Kawchuk’s employment by Axesstel or the termination thereof the stock
options granted to Kawchuk, claims for breach of contract or breach of the
covenant of good faith and fair dealing, and any claims of discrimination or
other claims under any federal, state or local law or regulation now in
existence or hereinafter enacted and as amended from time to time concerning in
any way the subject of Kawchuk’s employment with Axesstel or its termination.
The only claims not covered by this Section 9.9 are (i) claims for benefits
under the workers’ compensation laws or claims for unemployment insurance
benefits, which will be resolved pursuant to those laws, and (ii) Axesstel’s
claims for Kawchuk’s alleged breach of any of the provisions of Article 8 of
this Agreement. Binding arbitration will he conducted in San Diego County,
California, in accordance with the American Arbitration Association’s National
Rules for the Resolution of Employment Disputes then in effect. The party
initiating the arbitration shall bear the cost of the arbitration filing.
Axesstel will bear the cost of and hearing fees and the arbitrator. Each party
will bear its own attorneys’ fees, unless otherwise permitted by law and so
determined by the arbitrator. Kawchuk understands and agrees that the
arbitration shall be instead of any civil litigation and that the arbitrator’s
decision shall be final and binding to the fullest extent permitted by law and
enforceable by any court having jurisdiction thereof.

This Agreement is executed this 20th day of October, 2006.

 

    AXESSTEL, INC., a Nevada corporation /s/ MURRAY KAWCHUK     By:   /s/ MARV
TSEU Murray Kawchuk     Its:   Chief Executive Officer

 

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