CONVERTIBLE BOND SALE AND PURCHASE AGREEMENT

Exhibit 10.1

CONVERTIBLE BOND SALE AND PURCHASE AGREEMENT

Between

AXESS TELECOM CO., LTD.

and

AXESSTEL, INC.

February 16, 2005

CONVERTIBLE BOND SALE AND PURCHASE AGREEMENT

This AGREEMENT is made and entered into on this 16th day of February 2005, by and between Axess Telecom Co., Ltd., a Korean corporation having its registered office at Sungdo Bldg., 9 ^th Fl., 587-23, Sinsa-Dong, Gangnam-Gu, Seoul, Korea, 135-747 (the “Company”), and Axesstel, Inc., a Nevada corporation whose address is at 6815 Flanders Drive, Suite 210, San Diego, CA 92121, U.S.A. (“Purchaser”).

RECITALS

WHEREAS, the Company has agreed to issue and sell, and Purchaser has agreed to purchase, upon the terms and subject to the conditions of this Agreement, one (1) Convertible Bond of the Company, par value KRW 1,000,000,000 per bond (the “Convertible Bond”);

NOW, THEREFORE, the parties agree as follows:

“ Agreement ” means this convertible bond purchase agreement, including all amendments, modifications and supplements and any exhibits to any of the foregoing, as the same may be in effect at the time such reference becomes operative.

“ Articles of Incorporation ” means the articles of incorporation of the Company as may be amended from time to time.

“ Axess Trademarks ” means the trademark Axess registered in Korea and assigned registration No. 552325 and all confusingly similar trademarks, including but not limited to, the marks Axess Telecom and Axesstel.

“ Board of Directors ” means the board of directors of the Company.

“ Business Day ” means any day that is not a Saturday, Sunday or a national holiday in the Republic of Korea.

“ Closing ” means the closing of the Agreement as set forth in Section 2.2.

“ Closing Date ” means the day of Closing as shall be mutually agreed upon by the parties as set forth in Section 2.2.

“ Common Stock ” means the common stock, par value KRW 500 per share of the Company.

“ Conversion Price ” means the conversion price per share applicable to Common Stock as set forth in the Terms of Convertible Bond.

“ Convertible Bond ” means the Company’s Convertible Bond, par value KRW 1,000,000,000 per bond, the terms of which are set forth in the Terms of Convertible Bond.

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“ Governmental Authority ” means any nation or government, any state, municipality, or other political subdivision thereof, and any agency, department or other entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

“ Lien ” means any mortgage or deed of trust, pledge, hypothecation, assignment, deposit arrangement, lien, charge, claim, security interest, easement or encumbrance, or preference, priority or other security agreement or preferential arrangement of any kind or nature whatsoever (including, without limitation, any title retention agreement, any financing lease having substantially the same economic effect as any of the foregoing, and the filing of, or agreement to give, a security interest as to assets owned by the relevant Person).

“ Losses ” shall have the meaning as set forth in Section 6.1.

“ Maturity Date ” means the date when the Convertible Bond is to be settled as set forth in Section 4 of the Terms of the Convertible Bond.

“ Person ” means any individual, sole proprietorship, partnership, limited liability company, joint venture, trust, unincorporated organization, association, corporation, institution, public benefit corporation, entity or Governmental Authority.

“ Terms of the Convertible Bond ” means the Terms of Convertible Bond of the Company, setting forth the terms and conditions of the Convertible Bond, in the form attached as Exhibit A to this Agreement.

Subject to the terms and conditions set forth in this Agreement, Purchaser agrees to subscribe for and purchase from the Company, and the Company agrees to issue and sell to Purchaser, on the Closing Date, one (1) Convertible Bond, in the amounts to be purchased by Purchaser. The aggregate purchase price for the Convertible Bond subscribed for by Purchaser (“Total Purchase Price”) is KRW 1,000,000,000, which for purposes of payment, the Purchaser shall pay Nine Hundred Seventy-five Thousand United States Dollars ($975,000.00), payable in full on the Closing Date in accordance to Section 2.2 below.

The Closing shall occur on the 16th day of February, 2005, on which Closing Date, Purchaser shall initiate payment of the Total Purchase Price for the Convertible Bond due, in immediately available funds in United States Dollars by wire transfer to an account of the Company designated by the Company in writing to Purchaser prior to the Closing Date, and the Company shall execute and deliver to Purchaser a receipt evidencing Purchaser’s payment and shall record on its books that Purchaser is the holder of the Convertible Bond. The Convertible Bond shall be represented simply by this Agreement and its exhibit, and no further certificate or other writing representing the Convertible Bond shall be issued. Effective upon Purchaser’s payment of the Total Purchase Price, the Company shall be deemed to have issued and delivered

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the Convertible Bond to Purchaser, and Purchaser shall be the owner and holder of the Convertible Bond, all without the need for further documentation.

The Company shall cease all use of each of the Axess Trademarks not later than 60 days after the Closing Date and shall not thereafter make any use of any of the Axess Trademarks. If the Company breaches this Section 2.3, (i) such breach will constitute an Event of Default under the Convertible Bond, and (ii) within 5 days of written demand from Purchaser, the Company shall pay cash to Purchaser in the amount of One Million United States Dollars ($1,000,000 US) as liquidated damages, which shall be in addition to all amounts payable under the Convertible Bond. The parties agree that in the event of such a breach, it would be difficult to calculate the amount of actual damages suffered by Purchaser, and that the amount of such liquidated damages is reasonable under the circumstances existing at the time of this Agreement.

To secure the obligations of the Company under the Convertible Bond, the Company hereby grants to Purchaser a security interest on all of the assets of the Company. The Company represents that the security interest is a first Lien on all assets of the Company that are unencumbered as of the date of this Agreement and, with respect to all other assets of the Company, is subordinate only to Liens in effect on the date of this Agreement. The Company shall not grant additional Liens on its assets or increase the amount of indebtedness that any Lien secures.

In no event shall Purchaser, directly or indirectly, transfer (as defined below) any rights contained in the Convertible Bond or the Convertible Bond itself without the prior written consent of the Company. As used herein, “Transfer” means to sell, transfer, assign, pledge, option, mortgage, hypothecate or otherwise dispose of or encumber, whether with or without consideration and whether voluntary or involuntary or by operation of law.

The Company hereby represents and warrants to Purchaser that:

The Company is a corporation duly organized, validly existing and in good standing under the laws of Korea. The Company has the corporate power and authority to own and operate its properties and assets, to carry on its business as presently conducted, to execute and deliver this Agreement, to issue and sell the Convertible Bond and the shares of Common Stock issuable upon the conversion of the Convertible Bond, and to carry out the provisions of this Agreement and such other agreements and instruments. The Company is duly qualified and is authorized to do business and is in good standing as a foreign corporation in all jurisdictions in which the nature of its activities and of its properties (both owned and leased) makes such

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qualification necessary, except for those jurisdictions in which failure to do so would not have a material adverse effect on the Company or its business.

As of the date hereof, the authorized capital stock of the Company consists of 50,000,000 shares of Common Stock, par value KRW 500 per share, of which 14,510,481 shares of Common Stock are issued and outstanding. All such issued and outstanding shares of Common Stock are validly issued, fully paid and non-assessable.

(a) The issuance of the Convertible Bond has been duly authorized by all necessary corporate action on the part of the Company and, upon payment of the Total Purchase Price in accordance with the terms of this Agreement, the Convertible Bond will have been validly issued and, fully paid and non-assessable, free and clear of all Liens. Each of the terms of the Convertible Bond, as set forth in the Terms of the Convertible Bond, is legal, valid and enforceable.

(b) The Common Stock to be issued upon conversion of the Convertible Bond has been duly authorized by all necessary corporate action on the part of the Company. Once issued upon conversion of the Convertible Bond, such Common Stock will have been validly issued, fully paid and non-assessable and will be freely tradable on the market on which the Common Stock is traded on the date of this Agreement. The Company has duly reserved a sufficient number of shares of Common Stock for issuance upon conversion of the Convertible Bond.

(a) The execution, delivery and performance by the Company of this Agreement and the issuance and sale of the Convertible Bond (i) are within the Company’s corporate power; (ii) have been duly authorized by all necessary corporate action; (iii) are not in contravention of any provision of the Company’s Articles of Incorporation; (iv) will not violate, in any material respect, any law or regulation, or any order or decree of any Governmental Authority binding on the Company.

(b) This Agreement has been duly executed and delivered by the Company, and constitutes the valid and binding obligations of the Company enforceable against the Company in accordance with its terms. When issued by the Company in accordance with this Agreement, the Convertible Bond will constitute the valid and binding obligations of the Company enforceable against the Company in accordance with its terms.

The Company has no material contingent liabilities, except current liabilities incurred in the ordinary course of business and liabilities disclosed in filings made with regulatory authorities.

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The Company is not in violation or default of any term of its Articles of Incorporation or Bylaws, or of any material provision of any mortgage, indenture, contract, agreement, instrument or contract to which it is party or by which it is bound or of any judgment, decree, order or writ. The execution, delivery and performance of and compliance with this Agreement and the issuance and sale of the Convertible Bond by the Company pursuant hereto, will not, with or without the passage of time or giving of notice, result in any such material violation, or be in conflict with or constitute a default under any such term or provision, or result in the creation of any mortgage, pledge, lien, encumbrance or charge upon any of the properties or assets of the Company or the suspension, revocation, impairment, forfeiture or nonrenewal of any permit, license, authorization or approval applicable to the Company, its business or operations or any of its assets or properties.

Except as has been fully disclosed in regulatory filings made by the Company, there is no action, suit, proceeding or investigation pending or, to the Company’s knowledge, currently threatened against the Company that could be reasonably expected to prevent the Company from entering into and performing its obligation under this Agreement or consummating the transactions contemplated hereby or thereby, or which might result, either individually or in the aggregate, in any material adverse change in the assets, condition, affairs or prospects of the Company, financially or otherwise, or any change in the current equity ownership of the Company, nor is the Company aware that there is any basis for any of the foregoing. The Company is not a party or subject to the provisions of any order, writ, injunction, judgment or decree of any court or government agency or instrumentality. There is no action, suit, proceeding or investigation by the Company currently pending or which the Company intends to initiate.

The Company is not in violation in any material respect of any applicable statute, rule, regulation, order or restriction of any domestic or foreign government or any instrumentality or agency thereof in respect of the conduct of its business or the ownership of its properties which violation would materially and adversely affect the business, assets, liabilities, financial condition, operations or prospects of the Company. No governmental orders, permissions, consents, approvals or authorizations are required to be obtained and no registrations or declarations are required to be filed in connection with the execution and delivery of this Agreement and the issuance of the Convertible Bond, except such as has been duly and validly obtained or filed, or with respect to any filings that must be made after the Closing, as will be filed in a timely manner. The Company has all material franchises, permits, licenses and any similar authority necessary for the conduct of its business as now being conducted by it, the lack of which would materially and adversely affect the business, properties, prospects or financial condition of the Company.

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Assuming the accuracy of the representations and warranties of Purchaser contained in this Agreement, the offer, sale and issuance of the Convertible Bond and of any Common Stock issuable upon its conversion Securities will be in full compliance with all laws and regulations applicable to the Company.

The Company has filed all proxy statements, reports and other documents required relating to its outstanding securities required to be filed by it under applicable law. Each such filing was, at the time of its filing, in substantial compliance with the requirements of applicable law and none of such filings or the financial statements (and the notes thereto) included in the such filings, as of their respective filing dates, contained any untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances under which they were made, not misleading.

The Company’s Common Stock is listed for trading on the KOSDAQ and satisfies all requirements for the continuation of such listing. The Company has not received any notice that its Common Stock will be delisted from the KOSDAQ or that its Common Stock does not meet all requirements for listing.

Schedule 4.12 contains a complete and accurate list and description of all of the assets of the Company that are subject to Liens, the names of the parties that hold Liens on each of such assets and the amounts of the obligations that are secured by each such Lien, all as the date of this Agreement. Except as set forth on Schedule 4.12 , the Company has good and marketable title to its properties and assets, and good title to its leasehold estates, in each case subject to no Lien, other than (a) those resulting from taxes which have not yet become delinquent, (b) minor Liens and encumbrances which do not materially detract from the