EMPLOYMENT AGREEMENT

EXHIBIT 10.1

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (this “Agreement”) is made effective October 1, 2009 (the “Effective Date”), between GRAYMARK HEALTHCARE, INC, an Oklahoma corporation (“GRMH”), and STANTON NELSON, an individual (the “Executive” and collectively with GRMH, the “parties” or individually the “party”).

     WHEREAS, GRMH desires to retain the services of the Executive and the Executive desires to make the Executive’s services available to GRMH, and

     NOW, THEREFORE, in consideration of the mutual promises contained in this Agreement, GRMH and the Executive agree as follows:

1. Employment . GRMH hereby employ the Executive as an employee and Chairman of the Board of Directors and the Executive hereby accepts such employment subject to the terms and conditions contained in this Agreement. Subject to the terms of this Agreement, the employment relationship of the Executive with GRMH is “at will” and either can terminate this Agreement with or without cause as provided in this Agreement.

2. Executive’s Duties . The Executive is employed on a full-time basis. Throughout the term of this Agreement, the Executive will use the Executive’s best efforts and due diligence to assist GRMH in the acquisition and operation of pharmacies and sleep centers, and the long term profitable operation of GRMH consistent with developing and maintaining a quality business operation.

3. Other Activities . Except for the activities (the “Permitted Activities”) expressly approved by the Board of Directors of GRMH in writing, during the term of this Agreement, the Executive will not: (a) serve as an officer or director of any corporation, partnership, company or firm whose securities are publicly traded; (b) except for passive investments that do not violate this Agreement and do not interfere with the full time employment of Executive, serve as a general partner, manager

or officer of any corporation, partnership, limited liability company, other company or firm; or (c) directly or indirectly invest in, participate in or acquire an interest in any company, business or entity which is engaged, directly or indirectly, in the retail sale of pharmaceutical drugs or providing of sleep diagnostic services. The limitations in this Section 3 will not prohibit a passive investment by the Executive in publicly traded securities where the equity interest owned by the Executive does not exceed 2% of the total outstanding equity interests of the publicly traded company. The Executive shall disclose in writing to the Board of Directors of GRMH all above Permitted Activities at the time of the execution of this Agreement and thereafter upon written request.

4. GRMH Management Committee . Omitted.

5. Executive’s Compensation . GRMH agrees to compensate the Executive, subject to the terms of this Agreement, as follows:

6. Term . In the absence of termination as set forth in Section 7 below, this Agreement shall extend for a term of three (3) years commencing on the Effective Date of this Agreement and ending on September 30, 2012 (the “Employment Period”); provided, however, that commencing on the one-year anniversary of the Effective Date and each annual anniversary of such date (the “Renewal Date”) the Employment Period shall be automatically extended so as to terminate three (3) years from such Renewal Date. If at least 120 days prior to the Renewal Date, GRMH gives Executive notice that the Employment Period will not be so extended, this Agreement will continue for the remainder of the then current Employment Period and expire. The Employment Period may be sooner terminated under Section 7 of this Agreement.

7. Termination . This Agreement will continue in effect until the expiration of the term set forth in Section 6 of this Agreement, unless earlier terminated pursuant to this Section 7.

7.1.1 Termination without Cause . GRMH may terminate this Agreement without cause at any time by the service of written notice of termination to the Executive specifying an effective date of such termination not sooner than thirty (30) days after the date of such notice (the “Termination Date”). In the event this Agreement is terminated without cause by GRMH (i) the Executive shall be entitled to receive all compensation, reimbursements and benefits hereunder which were either payable to the Executive or which had been earned by the Executive as of the Termination Date, and (ii) the Executive will receive as severance compensation, conditioned upon Executive being in compliance with all provisions of this Agreement and no default having occurred or be continuing: (x) 300,000 fully vested restricted common stock shares in accordance with the 2008 Plan, reduced by the number of restricted common stock shares awarded to the Executive pursuant to Section 5.2, less all applicable federal and state payroll tax withholdings (if any), to be issued in equal monthly installments over 24 months; and (y) the continuance of all benefits under Section 5.3 of this Agreement for one (1) year after the Termination Date. The parties acknowledge that the amount payable pursuant to clause (ii) (x) includes payment for all vacation pay payable to the Executive through the Termination Date and, therefore, no amounts shall be payable pursuant to clause (i) for accrued vacation pay. Provided however, no payment under this section 7.1.1 shall be due or payable to Executive after the Termination Date in the event that Executive shall assert or claim that any part of any this Agreement (including but not limited to Sections 8, 9, 10 or 11) is invalid or unenforceable, in whole or part.

7.1.2 Termination for Cause . GRMH may terminate this Agreement for cause upon written notice if the Executive: (a) engages in gross personal misconduct which materially injures GRMH, or any fraud or deceit regarding the business of GRMH or its customers or suppliers; (b) enters a plea of nolo contendere to or is convicted of a felony; (c) willfully and repeatedly fails to perform the Executive’s duties under this Agreement after receiving notice and being provided an opportunity to correct such actions or (d) breaches any material term or provision of this Agreement (“for cause”). In the event this Agreement is terminated for cause by GRMH, (i) the Executive shall be entitled to receive all compensation, reimbursements and benefits

under this Agreement that are either payable to the Executive or that are earned by the Executive as of the Termination Date, and (ii) GRMH will not have any obligation to provide any further payments or benefits to the Executive after the effective date of such termination. This Agreement will not be deemed to have terminated for cause unless a written determination specifying the reasons for such termination shall be made and delivered to the Executive by GRMH. Thereafter, the Executive shall have the right for a period of thirty (30) days to request a GRMH meeting to be held at a mutually agreeable time and location within such thirty (30) days and attended by the governing body (or a representative appointed for this purpose) of GRMH then serving, at which meeting the Executive will have an opportunity to be heard. In the event of a termination for cause by GRMH, Executive acknowledges the Funding Agreement (defined below) shall continue in full force and effect.

7.2.1 Termination Without Cause . The Executive may voluntarily terminate this Agreement without cause by the service of written notice of such termination to GRMH specifying an effective date of such termination thirty (30) days after the date of such notice, during which time Executive may use remaining accrued vacation days or, at the option of GRMH, be paid for such days. In the event this Agreement is terminated without cause by the Executive, (i) the Executive shall be entitled to receive all compensation, reimbursements and benefits hereunder that are either payable to the Executive or that had been earned by the Executive as of the Termination Date, and (ii) GRMH will have no further obligations to Executive hereunder including, without limitation, any obligation of GRMH to provide any further compensation, payments or benefits to the Executive after the effective date of such termination. In the event this Agreement is terminated without cause by the Executive, Executive acknowledges the Funding Agreement (defined below) shall continue in full force and effect.

7.2.2 Termination for Cause . The Executive may terminate this Agreement at any time for cause by giving written notice thereof to GRMH. For purposes of this Section 7.2.2, the term “cause” shall mean a breach by GRMH of any material term or provision set forth in Sections 5.1 or 5.3 of this Agreement for the payment of compensation or benefits to which Executive is entitled under this Agreement, which breach is not cured within thirty (30) days after notice of such breach to GRMH by the Executive setting forth the facts upon which the breach is based. In the event this Agreement is terminated by the Executive for cause, (i) the Executive shall be entitled to receive all compensation, reimbursements and benefits hereunder which were either payable to the Executive or which had been earned by the Executive as of the termination date, and (ii) the Executive shall be entitled to receive as severance compensation: (x) 300,000 fully vested restricted common stock shares in accordance with the 2008 Plan, reduced by the number of restricted common stock shares awarded to the Executive pursuant to Section 5.2, less all applicable federal and state payroll tax withholdings (if any), to be issued in equal monthly installments

over 24 months; and (y) the continuance of all benefits under Section 5.3 of this Agreement for one (1) year after the Termination Date.