Document:

Promissory Note of Registrant

 EXHIBIT 10.5 
 THIS PROMISSORY NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED. THIS PROMISSORY NOTE MAY NOT BE ENCUMBERED, PLEDGED, HYPOTHECATED, SOLD, ASSIGNED, TRANSFERRED OR OTHERWISE DISPOSED OF IN THE ABSENCE OF AN
EFFECTIVE REGISTRATION STATEMENT FOR THE PROMISSORY NOTES UNDER SAID ACT OR AN OPINION OF COUNSEL SATISFACTORY IN FORM AND SUBSTANCE TO THE CORPORATION AND CONCURRED IN BY THE CORPORATION’S COUNSEL TO THE EFFECT THAT SUCH REGISTRATION IS NOT
REQUIRED UNDER SAID ACT OR SUCH TRANSACTION COMPLIES WITH RULES PROMULGATED BY THE SECURITIES AND EXCHANGE COMMISSION UNDER SAID ACT. 
 PROMISSORY NOTE 
  

			
	Principal Amount:	 	$ 346,950.00
	Date of Issuance:	 	May 16, 2006

 For value received, Axesstel, Inc., a Nevada corporation (“Axesstel”), promises
to pay to the order of Mike H.P. Kwon, an individual (“Kwon”), at the address for notice set forth below or at such other place as the holder of this Note (“Holder”) may from time to time designate in writing, in
lawful money of the United States, the principal sum of Three Hundred Forty-Six Thousand Nine Hundred Fifty Dollars ($346,950.00), with interest at the rate, and due and payable, as follows: 
 ARTICLE 1 - INTEREST 
 1.1 Rate of Interest. The principal balance
outstanding from time to time under this Promissory Note (“Note”) shall bear interest at the Prime Rate plus one percent (1%) per annum. For these purposes, the Prime Rate shall be as quoted in the “Money Rates”
column of the Wall Street Journal on the date of this Note, as adjusted annually on the second business day of each calendar year. 
 1.2
Computation of Interest. Interest shall be calculated on a 365/365 simple interest basis; that is, by applying the ratio of the annual interest rate over the number of days in a year (366 during leap years), multiplied by the outstanding
principal balance, multiplied by the actual number of days the principal balance is outstanding. 
 1.3 No Usurious Interest. In the
event that any interest rate(s) provided for in this Note shall be determined to be unlawful, such interest rate(s) shall be computed at the highest rate permitted by applicable law. Any payment by Axesstel of any interest amount in excess of that
permitted by law shall be considered a mistake, with the excess being applied to the principal amount of this Note without prepayment premium or penalty; if no such principal amount is outstanding, such excess shall be returned to Axesstel.

 ARTICLE 2 - PAYMENTS 
 2.1 Maturity Date. The entire principal balance and all accrued and unpaid interest shall be paid in full without setoff, deduction or counterclaim on the earlier to occur of (i) the date that Kwon’s
employment with Axesstel is terminated whether voluntarily or involuntarily, or (ii) May 15, 2008 (the “Maturity Date”). 
 2.2 Prepayment. Axesstel shall have the right to prepay all or any part of the principal balance of this Note at any time without charge or premium. 
 2.3 Application of Payments. All payments received, irrespective of how they may be designated by Axesstel, shall be applied first to charges other than interest and principal, if any, owing hereunder, then to
accrued interest, then to principal, except that, after the occurrence and during the continuation of any Event of Default under this Note, all amounts received shall be applied in such order as Holder, in its sole discretion, may elect. 

ARTICLE 3 - DEFAULT 
 3.1
Default. The following shall constitute an “Event of Default” under this Note: 
 (a) a default in the
payment when due of any amount hereunder; or 
 (b) the filing of a petition by or against Axesstel under any provision of the
Bankruptcy Reform Act, Title 11 of the United States Code as amended or recodified from time to time, or under any similar law relating to bankruptcy, insolvency, or other relief for debtors, or appointment or a receiver, trustee, custodian or
liquidator of or for all or any party of the assets or property of Axesstel, or the insolvency of Axesstel; or the making of a general assignment for the benefit of creditors by Axesstel. 
 3.2 Acceleration Right. If an Event of Default occurs under Section 3.1(c), then the outstanding principal of and all accrued and unpaid
interest on this Note shall automatically become immediately due and payable, without presentment, demand, protest or notice of any kind, all of which are hereby expressly waived. 
 3.3 Suits for Enforcement. Upon the occurrence of any one or more Events of Default, the Holder of this Note may proceed to protect and enforce
its rights hereunder by suit in equity, action at law or by other appropriate proceeding, whether for the specific performance of any covenant or agreement contained in this Note or in aid of the exercise of any power granted in this Note, or may
proceed to enforce the payment of this Note, or to enforce any other legal or equitable right of the Holder of this Note. In case of any default under this Note, Axesstel will pay to the Holder such amounts as shall be sufficient to cover the costs
and expenses (including reasonable attorneys’ fees) of such Holder in protecting and enforcing its rights under this Note. 
  

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 ARTICLE 4 - ADDITIONAL TERMS AND CONDITIONS 
 4.1 Time of the Essence. Time is of the essence with respect to the payment and performance of the obligations of this Note. 
 4.2 No Oral Waivers or Modifications. No provision of this Note may be waived or modified orally, but only in a writing signed by Holder.

 4.3 Governing Law. This Note shall be governed by and construed under the internal laws of the State of California, without regard
to conflict of law provisions. 
 4.4 Notices. All notices, demands and other communications required or permitted hereunder shall be
in writing, addressed to the appropriate party as follows: 
  

					
	 If to Kwon:
	 	Mr. Mike H.P. Kwon	  	
		 	  	  	
		 	  	  	
			
	 If to Axesstel:
	 	Axesstel, Inc.	  	
		 	6815 Flanders Drive, Suite 210	  	
		 	San Diego, California 92121	  	
		 	Attn: Senior Vice President Finance	  	

 The address for notice may be changed to such other address as may be designated from time to time
by notice to the other parties in the manner set forth herein, and shall be effective upon the earliest of (i) actual delivery if delivered by personal delivery or certified postage prepaid mail, or (ii) on the next day after timely and
proper deposit with an overnight air courier with request for next day delivery. 
 4.5 Replacement of Note. On receipt by Axesstel of
an affidavit of an authorized representative of Holder stating the circumstances of the loss, theft, destruction or mutilation of this Note (and in the case of any such mutilation, on surrender and cancellation of such Note), Axesstel, at its
expense, will promptly execute and deliver, in lieu thereof, a new Note of like tenor. If required by Axesstel, Holder must provide indemnity sufficient in the reasonable judgment of Axesstel to protect Axesstel from any loss, which it may suffer if
a lost, stolen or destroyed Note is replaced. 
  

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 4.6 Successors and Assigns. This Note binds Axesstel and its successors, assigns, heirs,
administrators and executors, and inures to the benefit of Holder and its successors, assigns, participants, heirs, administrators and executors. 
 SIGNATURES 
  

			
	Axesstel:
	
	 AXESSTEL, INC.

		
	By:	 	 /s/ Patrick L. Gray

		 	 Patrick L. Gray, Senior VP Finance

  

 4Registrant's Offer of Employment to Mike H.P. Kwon

 Exhibit 10.6 
  

			
	

	  	 6815 Flanders Drive Ste. 210, San Diego CA 92121
 tel.858.625.2100 fax.858.625.2110
 www.axesstel.com
  

	  
	  

 May 16, 2006 
 Mike H.P. Kwon 
 Dear Mike, 
 On behalf of Axesstel, Inc. (Axesstel), I am pleased to extend this offer of employment to you for the position of
Founder and Honorary Chairman working in our San Diego office. This position will report to Axesstel’s Board of Directors. You will have responsibilities related to business development and perform such duties as may be assigned by the
Board of Directors from time to time. The effective date of this letter shall be such date that both an authorized representative of Axesstel and you have signed this letter. 
  

			
	Annual Base Salary:	  	U.S $360,000 paid semi-monthly.
		
	Vacation:	  	As a full-time employee of Axesstel, you will be eligible for twenty (20) days of paid vacation per year. Vacation may be accrued up to a maximum cap of forty (40) days or such other maximum
accrual amount required under applicable law from time to time.
		
	Stock Options:	  	The terms and conditions of the stock option grants you have previously received are subject to the terms and conditions of their applicable stock option agreements.
		
	Health and Dental:	  	You will be eligible to participate in Axesstel’s health and dental insurance programs. Currently, Axesstel pays up to 90% of the HMO premiums for your health and 100% of dental benefits
for yourself

 
Mike H. P. Kwon 
 May 16, 2006 
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		  	and eligible dependents. These benefits are subject to the terms and conditions of the health and dental programs in place with Axesstel from time to time.
		
	401(k):	  	You will be eligible to participate in Axesstel’s 401(k) plan subject to the terms and conditions of the plan. Axesstel currently pays no company match of your contributions to the
plan.
		
	Bonus Plan:	  	You will be eligible for an annual performance bonus under the terms of Axesstel’s incentive compensation plans that may be adopted from time to time by the Compensation Committee of the
Board of Directors (the “Bonus”).
		
	Car Allowance:	  	During your employment, you will receive a car allowance of $1,500 per month and will be paid semi-monthly with paycheck ($750 each paycheck). This benefit shall be treated as additional
non-cash compensation for tax purposes.

 Axesstel reserves the right to modify and/or change any benefits and policies generally affecting
all employees at any time without notice. Notwithstanding the foregoing, Axesstel may modify and/or change the terms of this letter and any benefits herein as required to comply with all applicable laws, rules and regulations, including
Section 409(A) of the Internal Revenue Code. 
 Your entire business time, attention, energies, skills, learning and best efforts shall
be devoted to the business of Axesstel. You agree that during the term of your employment with Axesstel, you shall not carry on, directly or indirectly, and whether or not for compensation, any business activities that compete directly or indirectly
with Axesstel. The foregoing shall not be construed as preventing you from participating in social or civic associations if such participation does not interfere with the performance of your duties hereunder. 
 You represent that your employment by Axesstel does not and will not breach or constitute an event of default under any agreement (i) obligating you
to keep in confidence proprietary information acquired by you in confidence or in trust prior to, or at any point throughout, your employment by Axesstel, (ii) obligating you to assign to or protect for the benefit of any third party any
proprietary information or any improvement, 

  

					
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 Mike H. P. Kwon 
 May 16, 2006 
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invention, formulae, process, program, technique, know-how or data or (iii) that is designed in any way to limit your employment or activity in any
business in which you may compete, directly or indirectly, with any other business, or which might by application have such an effect. You have not entered into, and you agree that you will not enter into, any agreement, either written or oral, in
conflict herewith. 
 You understand, acknowledge and agree that, as part of the consideration for your employment and continued employment
by Axesstel, you have not brought and will not bring with you to Axesstel or use in the performance of your responsibilities at or for Axesstel any equipment, supplies, facility or trade secret or other proprietary information of any former employer
or customer which are not generally available to the public, unless you have obtained and provide herewith to Axesstel a copy of written authorization for Axesstel’s possession and use. 
 You also understand that, in your employment by Axesstel, you are not to breach any obligation of confidentiality that you have to others, and you agree
that you shall fulfill all such obligations during your employment by Axesstel. A copy of any document reflecting any such obligation (or a description thereof if no document is available) is provided herewith to Axesstel. 
 Axesstel is an at-will employer and as such your employment must be entered into voluntarily and for no specific period. As a result, you are free to
resign your employment at any time, for any reason, with or without notice. Axesstel’s Board of Directors shall have the right to terminate your employment at any time, for any reason, on 60 days prior written notice. 
 This letter, along with an Employee Inventions and Proprietary Rights Assignment Agreement between you and Axesstel set forth the terms or your
employment with Axesstel and supersede any prior agreements, whether written or oral. This letter may not be modified or amended except in writing, signed by Axesstel and you. This letter shall be governed by the laws of the State of California,
without regard to any conflicts of law provisions. 
 Any dispute regarding an alleged breach of this letter or arising out of this letter
shall be resolved through final and binding arbitration as the exclusive means of resolving such disputes. The arbitration shall be heard by a single arbitrator and shall take place in San Diego County, California. The arbitrator shall be selected
from the JAMS/San Diego panel of arbitrators. The arbitration shall be conducted in accordance with that set of published rules and procedures of JAMS then in effect, that are most applicable to the dispute in question. The cost of the arbitration
shall be borne by the Company. The parties shall have all rights of discovery available to civil litigants in court proceedings in California. The arbitrator shall have the jurisdiction and power to hear and determine all motions to compel
discovery, to impose related sanctions, and to make related orders, in the same manner as a judge. The prevailing party in the 

  

					
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Mike H. P. Kwon 
 May 16, 2006 
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arbitration shall be entitled to recover its reasonable attorney’s fees and costs incurred in connection with the arbitration. The arbitrator shall
issue a written decision and award. The decision and award of the arbitrator shall be final and binding. The arbitrator’s decision and award may be enforced and judgment on the award may be entered by a court of competent jurisdiction.

 If any provision of this letter is for any reason declared invalid, void or unenforceable by an arbitrator or court of competent
jurisdiction, the validity and binding effect of the remaining provisions shall not be affected, and the remaining provisions of this letter shall remain in full force and effect as if the letter had been executed without the invalid, void or
unenforceable provisions. 
 If the terms outlined above are acceptable to you, please initial each page and sign below and return the
original to me. 
 Sincerely, 
  

	
	Axesstel, Inc.
	
	    /s/ Bryan B. Min
	 Name: Bryan B. Min
 Title:
Chairman

 I hereby accept this offer of employment: 
  

					
			
	    /s/ Mike H. P. Kwon	 		 	May 16, 2006
	Mike H.P. Kwon	 		 	Date

  

					
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