Document:

exv10w1

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.

	 	2.1	 	Specific Duties. The Executive will serve as either or both the Chief
Executive Officer and Chairman of the Board of Directors of GRMH or such other position
and title as GRMH and Executive shall mutually determine from time to time. The
Executive will use the Executive’s best efforts to perform all of the services required
to fully and faithfully execute the offices and positions to which the Executive is
appointed and such other services as may be reasonably directed by GRMH in accordance
with this Agreement.
	 
	 	2.2	 	Rules and Regulations. GRMH may adopt an employee manual which
addresses frequently asked questions regarding employee relations with GRMH. The
employee manual will be subject to change without notice in the sole discretion of
GRMH at any time. The Executive agrees to comply with the applicable employee manual
except to the extent inconsistent with this Agreement. In the event of a conflict
between the employee manual and this Agreement, this Agreement will control over the
terms of the employee manual.

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

1

 

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:

	 	5.1	 	Base Salary. A base salary (the “Base Salary”), in an annual rate of
One and No/100 Dollar ($1.00). The Base Salary will be payable upon execution of this
Agreement and on October 1 following the Effective Date during the term of this
Agreement.
	 
	 	5.2	 	Restrict Stock Award. Upon execution of this Agreement, and on October
1 of each year during the term of this Agreement, the Executive shall be awarded
100,000 common stock shares of GRMH (the “Shares”) pursuant to and in accordance with
the Graymark Healthcare, Inc. 2008 Long-term Incentive Plan (the “2008 Plan”) (or a
substitute or successor plan to the 2008 Plan). The Shares shall be subject be fully
vested and not subject to forfeiture on the applicable October 1 award date.
	 
	 	5.3	 	Bonus. In addition to the Base Salary described at Section 5.1 of this
Agreement, GRMH may periodically review and may pay bonus compensation to the
Executive. Any bonus compensation determined to be paid, if any, will be at the
absolute discretion of GRMH in such amounts and at such times as GRMH may determine.
	 
	 	5.4	 	Benefits. During the term of this Agreement, the Executive shall be
entitled to participate in any employee benefit plans and programs which are maintained
by GRMH for and generally available to employees of GRMH, all in accordance with the
terms of such plans and programs. In addition, the Executive shall be entitled to
participate in any employee benefit plans and programs that are maintained by GRMH for
and generally available to its executive officers, all in accordance with the terms of
such plans and programs. GRMH shall reimburse the Executive for all reasonable and
ordinary expenses incurred by him on behalf of GRMH in the course of the Executive’s
duties upon the presentation by the Executive of appropriate documentation
substantiating the amount of and purpose for which such expenses were incurred, in
accordance with GRMH policy. The Executive will be entitled to take up to four (4)
weeks of paid vacation each calendar year during the term of this Agreement, without
carryover to the following calendar year.
	 
	 	5.5	 	Compensation Review. The compensation of the Executive will be
reviewed not less frequently than annually by GRMH.

2

 

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	 	Termination by Company. GRMH will have the following rights to terminate
this Agreement:

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

3

 

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	 	Termination by Executive. The Executive will have the following rights
to terminate this Agreement:

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

4

 

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.

	 	7.3	 	Incapacity of Executive. If the Executive suffers from a physical or
mental condition which, in the reasonable judgment of GRMH, prevents the Executive in
whole or in part from performing the duties specified herein for a period of three (3)
consecutive months, the employment of Executive may be terminated. The termination for
such incapacity shall be deemed as a termination with cause, and all compensation and
benefits payable under Section 5 of this Agreement will be continued for six (6) months
if the Executive shall be in compliance with all of the material terms of this
Agreement, and no default by Executive under this Agreement shall have occurred or
shall be continuing. Notwithstanding the foregoing, the Executive’s Base Salary
specified in Section 5.1, and the number of common stock shares specified in Section
5.2 based upon the Fair Market Value (as defined in the 2008 Plan) of the common stock
shares will be reduced by any benefits payable under any disability plans provided by
GRMH under Section 5 of this Agreement. Provided however, that no such compensation as
set forth in this 7.3 shall be due and payable in the event that and to the extent of a
default that has occurred and is continuing under the terms of the Funding Agreement.
	 
	 	7.4	 	Death of Executive. If the Executive should become deceased during the
term of this Agreement, such shall be deemed a termination for cause and GRMH may
thereafter terminate this Agreement without compensation to the Executive’s estate
except: (a) the obligation to deliver 50,000 fully vested restricted common stock
shares pursuant to and accordance with the 2008 Plan, and (b) the obligation to
continue the benefits described in Section 5.3 of this Agreement, if any or if
applicable, for six (6) months after the effective date of such termination, in both
cases if the Executive was in compliance with all of the material terms of this
Agreement and no default by the Executive under this Agreement has occurred or is
continuing. Provided however, that no such compensation as set forth in this 7.4 shall
be due and payable in the event that and to the extent of a default that has occurred
and is continuing under the terms of the Funding Agreement.
	 
	 	7.5	 	Effect of Termination. The termination of this Agreement will
terminate all obligations of the Executive to render services on behalf of GRMH,
provided that the Executive will maintain the confidentiality of all information that
is acquired by the Executive during the term of the Executive’s employment in
accordance with Section 8 of this Agreement. Except as otherwise provided in this
Section 7, no accrued bonus, severance pay or other form of compensation will be
payable by GRMH to the Executive by reason of the termination of this Agreement. All
keys, entry cards, credit cards, files, records, financial information, furniture,
furnishings, equipment, computers and laptops, software, supplies and other items
relating to GRMH will remain the property of GRMH. The Executive shall have the right
to retain and remove all personal property and effects that are owned by the Executive
and located in the offices of GRMH. All such personal items will be removed from such
offices no later than ten (10) days after the effective date of termination and GRMH
shall be authorized to discard any items remaining thereafter. Prior to the effective
date of

5

 

	 	 	 	termination, the Executive will cooperate with GRMH to provide for the orderly
termination of the Executive’s employment.
	 
	 	7.6	 	Condition. As a condition precedent to the right to receive the
payments set forth in this Section 7, the Executive (or his personal representative)
shall execute a waiver and release of all claims against GRMH and its governing body
and the other party to the Funding Agreement, which the Executive has or may have, in
form reasonably acceptable to GRMH, other than as to the right to receive payments as
provided in this Section 7 or as set forth in and applicable under Section 7.7 below
and the Executive shall be and remain in compliance at all times with this Agreement.
GRMH shall have the right of offset under this Agreement.
	 
	 	7.7	 	Release of GRMH. The Executive agrees, if his employment is terminated
under circumstances entitling him to payments under Section 7.1.1 or Section 7.2.2 of
this Agreement, that in consideration for the payments described in Section 7.1.1 or
Section 7.2.2, the Executive will execute a General Release in substantially the form
attached hereto as Exhibit A, through which the Executive releases GRMH from any and
all claims as may relate to or arise out of the Executive’s employment relationship
(excluding claims Executive may have under any “employee pension plan” as described in
Section 3(3) of ERISA or any claims under this Agreement). The form of the Release may
be modified as needed to reflect changes in the applicable law or regulations that are
needed to provide a legally enforceable and binding Release to GRMH at the time of
execution.

8. Confidentiality. The Executive recognizes that the nature of the Executive’s
services are such that the Executive will have access to information which constitutes trade
secrets, and/or is of a business or confidential nature, that is of great value to GRMH. The
Executive agrees not to disclose to any person other than the employees or approved legal counsel
of GRMH nor use for any purpose, other than the performance of this Agreement, any such
confidential information (“Confidential Information”), regardless of the source of the Confidential
Information or how same shall be obtained. All such Confidential Information shall be the sole and
exclusive property of GRMH, as applicable. Confidential Information includes, but is not limited
to, data or material (regardless of form) which is any of the following: (a) trade secret,
non-public information, or information proprietary to GRMH, (b) information pertaining to proposed
or pending pharmacy acquisitions or sales, proposed or pending sleep center acquisitions, or other
proposed or pending business of GRMH and (c) financial information or business plans of GRMH. The
Executive agrees that the provisions of this Section 8 will survive the termination, expiration or
cancellation of this Agreement for a period of two (2) years. The Executive will, upon any
termination of this Agreement (or at any other time requested by GRMH), deliver to GRMH all
originals and copies of the documents or materials containing Confidential Information. For
purposes of this Agreement, GRMH expressly includes any of its affiliated corporations,
partnerships, limited liability companies and other entities.

9. Restrictive Covenant. Notwithstanding any provision of this Agreement to the contrary,
and in further consideration of the terms of this Agreement, for a period of twenty-four (24)
months after Executive is no longer employed by GRMH for any reason with or without cause as
applicable, the Executive will not directly or indirectly:

6

 

	 	(a)	 	acquire, attempt to acquire, solicit, perform services in any capacity for, or aid
another in the acquisition or attempted acquisition of an interest in any business that is
involved in the acquisition of retail pharmacies or that is involved in the retail sale of
pharmaceutical drugs or the providing of sleep disorder diagnostic services, in any city in
the United States where GRMH or any of its affiliated corporations, partnerships, limited
liability companies or other entities owns a pharmacy or sleep center, or that is within 40
miles of a pharmacy or sleep center location owned by GRMH or any of its affiliated
corporations, partnerships, limited liability companies or other entities; or
	 
	 	(b)	 	solicit, induce, entice or attempt to entice any employee, officer or director (except
the Executive’s personal secretary, if any), contractor, customer, vendor or subcontractor
of GRMH or any of its affiliated corporations, partnerships, limited liability companies or
other entities to terminate or breach any relationship with GRMH or any of its affiliated
corporations, partnerships, limited liability companies or other entities; or
	 
	 	(c)	 	solicit, induce, entice or attempt to entice any customer, vendor or subcontractor of
GRMH or any of its affiliated corporations, partnerships, limited liability companies or
other entities to cease doing business with GRMH or any of its affiliated corporations,
partnerships, limited liability companies or other entities.

     Executive agrees that the Executive will not circumvent or attempt to circumvent the foregoing
agreements by any future arrangement or through the actions of a third party.

     Executive agrees the above separate restrictions will not work any undue hardship on
Executive, such restrictions are reasonable and that such restrictions will not keep Executive from
earning a living or obtaining reasonable employment. Executive is a stockholder of GRMH and former
direct member of SDC Holdings, LLC and ApothecaryRx, LLC, both wholly-owned subsidiaries of GRMY
and agrees that the restrictions herein are in further consideration thereof, this Agreement and
the sale and transfer of all goodwill associated with the former ownership of Company held by
Executive pursuant to that certain Exchange Agreement dated November 19, 2007.

10. Proprietary Matters. The Executive expressly understands and agrees that any and all
improvements, inventions, discoveries, processes, applications, patents, copyrights, trade names,
trademarks, know-how, trade secrets, or other proprietary matters (“Proprietary Items”) that are
principally related to the business of GRMH and which were generated or conceived by the Executive
during the term of this Agreement, whether generated or conceived during the Executive’s regular
working hours or otherwise, and whether patentable, subject to copyright or trademark protection or
not, will be the sole and exclusive property of GRMH. Whenever requested by GRMH (either during
the term of this Agreement or thereafter), the Executive will assign or execute any and all
applications, assignments and or other instruments and do all things reasonably necessary or
appropriate in order to permit GRMH to: (a) assign and convey or otherwise make available to GRMH
the sole and exclusive right, title, and interest in and to the Proprietary Items; or (b) apply
for, obtain, maintain, enforce and defend patents, copyrights, trade names, or trademarks of the
United States or of foreign countries for the Proprietary Items. In the event any action requested
by GRMH to be taken by the Executive after the termination of this Agreement involves more than a
de minimis amount of time, GRMH shall reasonably compensate the Executive for his time.

7

 

11. Arbitration. The parties will attempt to promptly resolve any dispute or controversy
arising out of or relating to this Agreement or termination of the Executive by GRMH. Any
negotiations pursuant to this Section 11 shall be confidential and will be treated as compromise
and settlement negotiations for all purposes. If the parties are unable to resolve the dispute,
the dispute will be submitted to binding arbitration before a single arbitrator in accordance with
the Rules for Commercial Cases of the American Arbitration Association and shall be undertaken
pursuant to the Federal Arbitration Act. The arbitrator will be instructed and empowered to take
reasonable steps to expedite the arbitration and the arbitrator’s judgment will be final and
binding upon the parties subject solely to challenge on the grounds of fraud or gross misconduct.
The arbitrator is not empowered to award punitive or exemplary damages but only compensatory
damages and each party hereby irrevocably waives any damages or right thereto other than such
compensatory damages. The arbitrator shall be empowered to apply the remedy of specific
enforcement. The arbitration will be held in Oklahoma City, Oklahoma. Judgment upon any verdict
in arbitration may be entered in any court of competent jurisdiction. Each party will initially
bear its own costs in connection with the arbitration and the costs of the arbitrator will be borne
by the party who the arbitrator determines did not prevail in the matter. The procedures specified
in this Section 11 will be the sole and exclusive remedies and procedures for the resolution of
disputes and controversies between the parties arising out of or relating to this Agreement.
Notwithstanding the foregoing, a party may seek a preliminary injunction or other provisional
judicial relief if in such party’s judgment such action is necessary to avoid irreparable damage or
to preserve the status quo pending arbitration. The parties hereby consent to the exclusive
jurisdiction of and proper venue in, either the Federal District Court for the Western District of
Oklahoma or Oklahoma County District Court, sitting in Oklahoma County, Oklahoma (as applicable)
for purposes of any permitted action in the nature of a preliminary injunction.

12. Miscellaneous. The parties further agree as follows:

	 	12.1	 	Time. Time is of the essence of each provision of this Agreement.
	 
	 	12.2	 	Notices. Any notice, payment, demand or communication required or
permitted to be given by any provision of this Agreement will be in writing and will be
deemed to have been given when delivered personally or by confirmed telefacsimile to
the party designated to receive such notice, or on the date following the day sent by
overnight courier, or on the third (3rd) business day after the same is sent by
certified mail, postage and charges prepaid, directed to the following address or to
such other or additional addresses as any party might designate by written notice to
the other party:

	 	 	 	 	 
	 

	 	To the Executive:
	 	Mr. Stanton Nelson

101 North Robinson, Suite 900

Oklahoma City, Oklahoma 73102
	 
	 	 	 	 
	 

	 	To GRMH:
	 	Graymark Healthcare, Inc.

210 Park Avenue, Suite 1350

Oklahoma City, Oklahoma, 73102

	 	12.3	 	Assignment. Neither this Agreement nor any of the parties’ rights or
obligations hereunder can be transferred or assigned without the prior written consent
of the other parties to this Agreement, except that this Agreement shall be assignable
to any

8

 

	 	 	 	successor in interest of GRMH or any successor in interest to substantially all of
the assets of GRMH.
	 
	 	12.4	 	Construction and Severability. This Agreement is intended to be
interpreted, construed and enforced in accordance with the laws of the State of
Oklahoma, notwithstanding any conflict of law principles. The rule of construction that
an agreement shall be construed against the drafter shall not apply as all parties
hereto have negotiated and drafted this Agreement. If any provision of this Agreement
or the application thereof to any person or circumstance is determined, to any extent,
to be invalid or unenforceable, the remainder of this Agreement, or the application of
such provision to persons or circumstances other than those as to which the same is
held invalid or unenforceable, will not be affected thereby, and each term and
provision of this Agreement will be valid and enforceable to the fullest extent
permitted by law.
	 
	 	12.5	 	Entire Agreement. Except as provided in this Agreement, this Agreement
is the final, complete and exclusive expression of the agreement between GRMH and the
Executive, supersedes and replaces in all respects any prior employment agreements and
on execution the employment relationship between GRMH and the Executive after the
effective date of this Agreement will be governed by the terms of this Agreement or any
other agreements, oral or otherwise. No modification of this Agreement will be
effective unless made by a written agreement executed by all of the parties. No
inducement to any party exists except as set forth in this Agreement in writing. This
Agreement may be executed in multiple counterparts, each of which shall be deemed an
original but all of which taken together shall constitute one and the same instrument.
	 
	 	12.6	 	Binding Effect. This Agreement will be binding on the parties and
their respective successors, legal representatives and permitted assigns.
	 
	 	12.7	 	Attorneys’ Fees. If any party institutes a permissible action or
proceeding or an arbitration against any other party relating to the provisions of this
Agreement or any default hereunder, the unsuccessful party to such action or proceeding
will reimburse the successful party therein for the reasonable expenses of attorneys’
fees and disbursements and litigation expenses incurred by the successful party.

[SIGNATURES ON FOLLOWING PAGE]

9

 

     IN WITNESS WHEREOF, the undersigned have executed this Agreement to be effective as of the
Effective Date.

	 	 	 	 	 
	 	 	 
	 	  	                                        /S/ STANTON NELSON
 	 
	 	 	STANTON NELSON, individually 	 
	 	 	Date: October 13, 2009

(the “Executive”) 	 
	 

	 	 	 	 	 
	 	GRAYMARK HEALTHCARE, INC.

 	 
	 	By:  	/S/ JOSEPH HARROZ, JR.
 	 
	 	 	Joseph Harroz, Jr., President 	 
	 	 	Date: October 13, 2009

(“GRMH”) 	 

10

 

	 	 	 	 	 

EXHIBIT A

NOTICE. Various laws, including Title VII of the Civil Rights Act of 1964, the Civil Rights Act of
1866, the Pregnancy Discrimination Act of 1978, the Equal Pay Act, the Civil Rights Act of 1991,
the Age Discrimination in Employment Act, the Rehabilitation Act of 1973, the Americans With
Disabilities Act, the Employee Retirement Income Security Act and the Veterans Reemployment Rights
Act (all as amended from time to time), prohibit employment discrimination based on sex, race,
color, national origin, religion, age, disability, eligibility for covered employee benefits and
veteran status. You may also have rights under laws such as the Older Worker Benefit Protection
Act of 1990, the Worker Adjustment and Retraining Act of 1988, the Fair Labor Standards Act, the
Family and Medical Leave Act, the Occupational Health and Safety Act and other federal, state
and/or municipal statutes, orders or regulations pertaining to labor, employment and/or employee
benefits. These laws are enforced through the United States Department of Labor and its agencies,
including the Equal Employment Opportunity Commission (EEOC), and various state and municipal labor
departments, fair employment boards, human rights commissions and similar agencies.

This General Release is being provided to you in connection with the Employment Agreement between
you and Graymark Healthcare, Inc. with an effective date of October 1, 2009 (the “Agreement”). The
federal Older Worker Benefit Protection Act requires that you have at least twenty-one (21) days,
if you want it, to consider whether you wish to sign a release such as this one in connection with
a special, individualized severance package. You have until the close of business twenty-one (21)
days from the date you receive this General Release to make your decision. You may not sign this
General Release until, at the earliest, your official date of separation from employment.

BEFORE EXECUTING THIS GENERAL RELEASE YOU SHOULD REVIEW THESE DOCUMENTS CAREFULLY AND CONSULT WITH
YOUR ATTORNEY.

You may revoke this General Release within seven (7) days after you sign it and it shall not become
effective or enforceable until that revocation period has expired. If you do not accept the
severance package and sign and return this General Release, or if you exercise your right to revoke
the General Release after signing it, you will not be eligible for the special, individualized
severance package. Any revocation must be in writing and must be received by Graymark Healthcare,
Inc., 101 N. Robinson, Suite 920, Oklahoma City, OK 73102, within the seven-day period following
your execution of this General Release.

11

 

GENERAL RELEASE

In consideration of the special, individualized severance package offered to me by Graymark
Healthcare, Inc. (the “Company”) and the separation benefits I will receive as reflected in the
Employment Agreement between me and Graymark Healthcare, Inc. with an effective date of October 1,
2009 (the “Agreement”), I hereby release and discharge Graymark Healthcare, Inc. and its
predecessors, successors, affiliates, parent, subsidiaries and partners and each of those entities’
employees, officers, directors and agents (hereafter collectively referred to as the “Company”)
from all claims, liabilities, demands, and causes of action, known or unknown, fixed or contingent,
which I may have or claim to have against the Company either as a result of my past employment with
the Company and/or the severance of that relationship and/or otherwise, and hereby waive any and
all rights I may have with respect to and promise not to file a lawsuit to assert any such claims.

This General Release includes, but is not limited to, claims arising under Title VII of the Civil
Rights Act of 1964, the Civil Rights Act of 1866, the Pregnancy Discrimination Act of 1978, the
Equal Pay Act, the Civil Rights Act of 1991, the Age Discrimination in Employment Act, the
Rehabilitation Act of 1973, the Americans With Disabilities Act, the Employee Retirement Income
Security Act or 1974 and the Veterans Reemployment Rights Act (all as amended from time to time).
This General Release also includes, but is not limited to, any rights I may have under the Older
Workers Benefit Protection Act of 1990, the Worker Adjustment and Retraining Act of 1988, the Fair
Labor Standards Act, the Family and Medical Leave Act, the Occupational Health and Safety Act and
any other federal, state and/or municipal statutes, orders or regulations pertaining to labor,
employment and/or employee benefits. This General Release also applies to any claims or rights I
may have growing out of any legal or equitable restrictions on the Company’s rights not to continue
an employment relationship with its employees, including any express or implied employment
contracts, and to any claims I may have against the Company for fraudulent inducement or
misrepresentation, defamation, wrongful termination or other retaliation claims in connection with
workers’ compensation or alleged “whistleblower” status or on any other basis whatsoever.

It is specifically agreed, however, that this General Release does not have any effect on any
rights or claims I may have against the Company which arise after the date I execute this General
Release or on any vested rights I may have under any of the Company’s qualified or non-qualified
benefit plans or arrangements as of or after my last day of employment with the Company, or on any
of the Company’s obligations under the Agreement or as otherwise required under the Consolidated
Omnibus Budget and Reconciliation Act of 1985 (COBRA).

I have carefully reviewed and fully understand all the provisions of the Agreement and General
Release, including the foregoing Notice. I have not relied on any representation or statement,
oral or written, by the Company or any of its representatives, which is not set forth in those
documents.

The Agreement and this General Release, including the foregoing Notice, set forth the entire
agreement between me and the Company with respect to this subject. I understand that my receipt
and retention of the separation benefits covered by the Agreement are contingent not only on my
execution of this General Release, but also on my continued compliance with my other obligations
under the Agreement. I acknowledge that the Company gave me twenty-one (21)
days to consider whether I wish to accept or reject the separation benefits I am eligible to
receive

12

 

under the Agreement in exchange for this General Release. I also acknowledge that the
Company advised me to seek independent legal advice as to these matters, if I chose to do so. I
hereby represent and state that I have taken such actions and obtained such information and
independent legal or other advice, if any, that I believed were necessary for me to fully
understand the effects and consequences of the Agreement and General Release prior to signing those
documents.

Dated this ___ day of _________ , ___.

	 	 	 	 	 
	 	______________________________________

_________________________

 	 
	 	 	 
	 	 	 
	 	 	 
	 

13exv10w2

EXHIBIT 10.2

EMPLOYMENT AGREEMENT

     THIS EMPLOYMENT AGREEMENT (this “Agreement”), dated as of the 13th day of October 2009 with an
effective date of August 1, 2009, is entered into by and between GRAYMARK HEALTHCARE, INC., an
Oklahoma corporation (the “Company”) and GRANT A. CHRISTIANSON (“Executive”).

     IN CONSIDERATION of the premises and the mutual covenants set forth below, the parties hereby
agree as follows:

     WHEREAS, the Company desires to retain the Executive as its employee; and

     WHEREAS, in order to provide an incentive to the Executive to become employed by the Company,
the Company believes it is necessary to enter into this Agreement, and more specifically, to
provide the proper incentive to the Executive by authorizing the granting of restricted stock as
provided in this Agreement.

     1. Term. The initial term of Executive’s employment by the Company pursuant to this
Agreement shall commence on August 1, 2009 (the “Effective Date”) and terminate on July 31, 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, the Company 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 5 of
this Agreement.

     2. Position and Duties. Executive will serve as Chief Financial Officer of the
Company. During the Employment Period, Executive will report directly to the Chairman of the Board
(the “Chairman”). Executive shall perform all services reasonably required to fully execute the
duties and responsibilities associated with the Company and its affiliates. Executive will devote
substantially all of his working time, attention and energies (other than absences due to illness
or vacation) to the performance of his duties for the Company. Notwithstanding the above,
Executive will be permitted, to the extent such activities do not interfere with the performance by
Executive of his duties and responsibilities under this Agreement or violate this Agreement, to (i)
manage Executive’s personal, financial and legal affairs, and (ii) serve on industry, civic or
charitable boards or committees.

     3. Place of Performance. Executive’s place of employment will be the principal
executive offices of ApothecaryRx, LLC, the Company’s subsidiary, in Golden Valley, Minnesota.

 

 

     4. Compensation and Related Matters.

          (a) Base Salary. During the Employment Period, the Company will pay Executive an
annual base salary (“Base Salary”) of not less than (i) Eleven Thousand Six Hundred Sixty-six and
66/100 Dollars ($11,666.66) per month during the period August 1, 2009 through December 31, 2009
(One Hundred Forty Thousand Dollars ($140,000) per year on a pro rated monthly basis), (ii)
Thirteen Thousand Three Hundred Thirty-three and 33/100 Dollars ($13,333.33) per month during the
period January 1, 2010 through June 30, 2010 (One Hundred Sixty Thousand Dollars ($160,000) per
year on a pro rated monthly basis), and (iii) Fifteen Thousand Dollars ($15,000) per month
commencing on July 1, 2010 (One Hundred Eighty Thousand Dollars ($180,000) per year on a pro rated
monthly basis), in approximate equal installments in accordance with the Company’s customary
payroll practices. Executive’s Base Salary may be increased, but not decreased, pursuant to annual
review by the Company’s Compensation Committee. In the event Executive’s Base Salary is increased,
the increased amount will then constitute the Base Salary for all purposes of this Agreement.

          (b) Equity Incentives. Contemporaneous with the execution of this Agreement, pursuant
to the Graymark Healthcare, Inc. 2008 Long-Term Incentive Plan (“Long-Term Incentive Plan”) the
Company will grant to Executive One Hundred Thirty-five Thousand (135,000) shares of Restricted
Stock under the terms of the Restricted Stock Award Agreement. The grant of the Restricted Stock
Award will be made in accordance with all applicable laws and regulations.

          (c) Welfare, Pension and Incentive Benefit. During the Employment Period, Executive
(and his spouse and/or dependents to the extent provided in the applicable plans and programs) will
be entitled to participate in and be covered under all the welfare benefit plans or programs
maintained by the Company for the benefit of its senior executive officers pursuant to the terms of
such plans and programs including, without limitation, all medical, life, hospitalization, dental,
disability, accidental death and dismemberment and travel accident insurance plans and programs.
In addition, during the Employment Period, Executive will be eligible to participate in all
pension, retirement, savings and other employee benefit plans and programs maintained from time to
time by the Company for the benefit of its senior executive officers.

          (d) Vacation. Executive shall be entitled to at least twenty (20) business days of
paid vacation for each calendar year during the Employment Period. Executive may use his vacation
in a reasonable manner based upon the business needs of the Company. Unused vacation days will
accrue from year to year without limitation.

          (e) Fringe Benefits. During the Employment Period, the Company will provide Executive
with such other fringe benefits as commensurate with Executive’s position.

     5. Termination. Executive’s employment under this Agreement may be terminated during
the Employment Period under the following circumstances:

          (a) Death. Executive’s employment under this Agreement will terminate upon his death.

2

 

          (b) Disability. If, as a result of Executive’s incapacity due to physical or mental
illness, Executive is substantially unable to perform his duties under this Agreement (with or
without reasonable accommodation, as defined under the Americans With Disabilities Act) for an
entire period of six (6) consecutive months, and within thirty (30) days after a Notice of
Termination (as defined in Section 6(a)) is given after such six (6) month period, and Executive
does not return to the substantial performance of his duties on a full-time basis, the Company has
the right to terminate Executive’s employment under this Agreement for “Disability,” and such
termination will not be a breach of this Agreement by the Company.

          (c) Cause. The Company has the right to terminate Executive’s employment for Cause,
and such termination will not be a breach of this Agreement by the Company. “Cause” means
termination of employment for one of the following reasons: (i) the conviction of Executive by a
federal or state court of competent jurisdiction or a plea of no contest to a felony which relates
to Executive’s employment at the Company; (ii) an act or acts of dishonesty taken by Executive and
intended to result in substantial personal enrichment of Executive at the expense of the Company or
any affiliate; or (iii) Executive’s “willful” failure to follow a direct lawful written order from
the Chairman, within the reasonable scope of Executive’s duties, which failure is not cured within
thirty (30) days. For purposes of this Subsection (c), no act or failure to act on Executive’s
part shall be deemed “willful” unless done or omitted to be done by Executive, not in good faith
and without reasonable belief that Executive’s action or omission was in the best interest of the
Company.

          (d) Good Reason. Executive may terminate his employment with the Company for “Good
Reason.” For purposes of this Agreement, “Good Reason” shall mean the occurrence without the
written consent of Executive, of one of the events set forth below:

          (1) a material diminution in the Executive’s authority, duties or responsibilities;

          (2) the reduction by the Company of Executive’s Base Salary or a reduction in the
equity incentives below the minimum specified in Subsection 4(b);

          (3) the requirement that Executive be based at any office or location that is more than
60 miles from the ApothecaryRx, LLC’s current location in Golden Valley, Minnesota, except
for travel reasonably required in the performance of Executive’s responsibilities; or

          (4) any other action or inaction that constitutes a material breach by the Company of
this Agreement such as the failure of any successor to the Company to assume this Agreement
pursuant to Section 14.

The Executive must provide notice to the Company of the existence of one of the conditions
described above within ninety (90) days of the initial existence of the condition. The Company has
a period of 30 days after receipt of notice from the Executive to remedy the situation. If the
Company fails to remedy the condition, the Executive may terminate his employment for Good Reason
by providing a Notice of Termination to the Company within thirty (30) days of the expiration of
the Company’s period to remedy the condition. Termination for Good Reason by the

3

 

Executive will not be a breach of this Agreement and will entitle Executive to the Compensation and
benefits described in Section 7(a) hereof.

          (e) Without Cause. The Company has the right to terminate Executive’s employment
under this Agreement without Cause by providing Executive with a Notice of Termination, subject to
the obligations set forth in Section 7(a) hereof.

          (f) Voluntary Termination. Executive may voluntarily terminate employment with the
Company at any time, and if such termination is not for Good Reason, then Executive shall only be
entitled to compensation and benefits as described in Section 7(b) hereof.

     6. Termination Procedure.

          (a) Notice of Termination. Any termination of Executive’s employment by the Company
or by Executive during the Employment Period (other than termination pursuant to Section 5(a)) will
be communicated by written Notice of Termination to the other party in accordance with Section 15.
For purposes of this Agreement, a “Notice of Termination” means a written notice which indicates
the specific termination provision in this Agreement relied upon and sets forth in reasonable
detail the facts and circumstances claimed to provide a basis for termination of Executive’s
employment.

          (b) Date of Termination. “Date of Termination” shall mean (i) if Executive’s
employment is terminated by his death, the date of his death, (ii) if Executive’s employment is
terminated due to Disability pursuant to Section 5(b), thirty (30) days after Notice of Termination
(provided that Executive has not returned to the substantial performance of his duties on a
full-time basis during such thirty (30) day period), (iii) if Executive’s employment is terminated
for Good Reason pursuant to Section 5(d), the date on which a Notice of Termination provided in
accordance with such Section is given or any later date (within thirty (30) days after the giving
of such Notice of Termination) set forth in such Notice of Termination, or (iv) if Executive’s
employment is terminated for any other reason, the date on which a Notice of Termination is given
or any later date (within thirty (30) days after the giving of such Notice of Termination) set
forth in such Notice of Termination.

     7. Compensation Upon Termination or During Disability. In the event of Executive’s
Disability or termination of his employment under this Agreement during the Employment Period, the
Company will provide Executive with the payments and benefits set forth below.

          (a) Termination by Company Without Cause or by Executive for Good Reason. If
Executive’s employment is terminated by the Company without Cause or by Executive for Good Reason:

               (i) the Company will pay to Executive within thirty (30) days of the Date of Termination in a
single lump sum payment (A) his earned but unpaid Base Salary and accrued vacation pay through the
Date of Termination and (B) an amount equal to his then total annual Base Salary multiplied by two
(2);

4

 

               (ii) the Company will maintain in full force and effect, for the continued benefit of
Executive (and his spouse and/or his dependents, as applicable) for a period of eighteen (18)
months following the Date of Termination, the medical, hospitalization, and dental programs in
which Executive (and his spouse and/or his dependents, as applicable) participated immediately
prior to the Date of Termination, at the level in effect and upon substantially the same terms and
conditions (including, without limitation, contributions required by Executive for such benefits)
as existed immediately prior to the Date of Termination; provided, if Executive (or his spouse) is
eligible for Medicare or a similar type of governmental medical benefit, such benefit shall be the
primary provider before Company medical benefits are provided. However, if Executive becomes
reemployed with another employer and is eligible to receive medical, hospitalization and dental
benefits under another employer—provided plan, the medical, hospitalization and dental benefits
described herein shall be secondary to those provided under such other plan during the applicable
period;

               (iii) the Company will reimburse Executive, pursuant to the Company’s policy, for reasonable
business expenses incurred, but not paid, prior to the Date of Termination; and

               (iv) Executive will be entitled to any other rights, compensation and/or benefits as may be
due to Executive following such termination to which he is otherwise entitled in accordance with
the terms and provisions of any plans or programs of the Company.

          (b) Termination by Company for Cause or by Executive Without Good Reason. If
Executive’s employment is terminated by the Company for Cause or by Executive (other than for Good
Reason):

               (i) the Company will pay Executive his earned but unpaid Base Salary and his accrued vacation
pay (to the extent required by law or the Company’s vacation policy) through the Date of
Termination, as soon as practicable following the Date of Termination;

               (ii) the Company will reimburse Executive, pursuant to the Company’s policy, for reasonable
business expenses incurred, but not paid, prior to the Date of Termination, unless such termination
resulted from a misappropriation of Company funds; and

               (iii) Executive will be entitled to any other rights, compensation and/or benefits as may be
due to Executive following termination to which he is otherwise entitled in accordance with the
terms and provisions of any plans or programs of the Company.

          (c) Disability. During any period that Executive fails to perform his duties under
this Agreement as a result of incapacity due to physical or mental illness (“Disability Period”),
Executive will continue to receive his full Base Salary set forth in Section 4(a) until his
employment is terminated pursuant to Section 5(b). In the event Executive’s employment is
terminated for Disability pursuant to Section 5(b):

               (i) the Company will (A) pay to Executive his earned but unpaid Base Salary and accrued
vacation pay through the Date of Termination, as soon as

5

 

practicable following the Date of Termination, and (B) provide Executive with disability
benefits pursuant to the terms of the Company’s disability programs and/or practices;

               (ii) the Company will reimburse Executive, pursuant to the Company’s policy, for reasonable
business expenses incurred, but not paid, prior to the Date of Termination; and

               (iii) Executive will be entitled to any other rights, compensation and/or benefits as may be
due to Executive following such termination to which he is otherwise entitled in accordance with
the terms and provisions of any plans or programs of the Company.

          (d) Death. If Executive’s employment is terminated by his death, the Company will pay
in a lump sum to Executive’s beneficiary, or personal or legal representatives or estate, as the
case may be, Executive’s earned but unpaid Base Salary as of the date of death, accrued vacation
and unreimbursed business expenses and amounts due under any plans, programs or arrangements of the
Company through the Date of Termination.

     8. Mitigation. Executive will not be required to mitigate amounts payable under this
Agreement by seeking other employment or otherwise, and there will be no offset against amounts due
Executive under this Agreement on account of subsequent employment except as specifically provided
herein.

     9. Confidential Information; Non-Solicitation.

          (a) Nondisclosure of Confidential Information. Executive acknowledges that it is the
policy of the Company to maintain as secret and confidential (i) all valuable and unique
information, (ii) other information heretofore or hereafter acquired by the Company, or any
affiliated entity and deemed by it to be confidential, and (iii) information developed or used by
the Company or any affiliated entity relating to the business, operations, employees and customers
of the Company or any affiliated entity including, but not limited to, any customer lists or
employee information (all such information described in clauses (i), (ii) and (iii) above, other
than information which is known to the public or becomes known to the public through no fault of
Executive, is hereinafter referred to as “Confidential Information”). The parties recognize that
the services to be performed by Executive pursuant to this Agreement are special and unique and
that by reason of his employment by the Company after the date hereof, Executive has acquired and
will acquire Confidential Information. Executive recognizes that all such Confidential Information
is the property of the Company. Accordingly, at any time during or after the Employment Period,
Executive shall not, except in the proper performance of his duties under this Agreement, directly
or indirectly, without the prior written consent of the Company, disclose to any Person other than
the Company, whether or not such Person is a competitor of the Company, and shall use his best
efforts to prevent the publication or disclosure of any Confidential Information obtained by, or
which has come to the knowledge of, Executive prior or subsequent to the date hereof.
Notwithstanding the foregoing, Executive may disclose to other Persons, as part of his occupation,
information with respect to the Company or any affiliated entity, which (i) is of a type generally
not considered by standards of the healthcare industry to be proprietary, or (ii) is otherwise
consented to in writing by the Company.

6

 

          (b) Non-Solicitation. Executive shall not, during the Employment Period or for one
year following his Date of Termination (the “Covered Period”), either personally or by or through
his agent or by letters, circulars or advertisements and whether for himself or on behalf of any
other person, seek to persuade any employee of the Company, or any affiliated entity or any person
who was an employee of the Company or any affiliated entity during the Covered Period, to
discontinue his or her status or employment with the Company, or such affiliated entity or to
become employed in a business or activities likely to be competitive with the Company, or any
affiliated entity.

          (c) Obligations of Executive Upon Termination. Upon termination of this Agreement for
any reason, Executive shall return to the Company all documents and copies of documents in his
possession relating to any Confidential Information including, but not limited to, internal and
external business forms, manuals, correspondence, notes and computer programs, and Executive shall
not make or retain any copy or extract of any of the foregoing. In addition, Executive shall
resign from all positions held with the Company or any affiliated entities.

          (d) Remedies. Executive acknowledges and understands that paragraphs 9(a),
9(b) and 9(c) and the other provisions of this Agreement are of a special and unique nature, the
loss of which cannot be adequately compensated for in damages by an action at law, and that the
breach or threatened breach of the provisions of this Agreement would cause the Company irreparable
harm. In the event of a breach or threatened breach by Executive of the provisions of this
Agreement, the Company shall be entitled to an injunction restraining him from such breach.
Nothing contained in this Agreement shall be construed as prohibiting the Company from pursuing, or
limiting the Company’s ability to pursue, any other remedies available for any breach or threatened
breach of this Agreement by Executive. The provision of this Agreement relating to arbitration of
disputes shall not be applicable to the Company to the extent it seeks an injunction in any court
to restrain Executive from violating paragraphs 9(a), 9(b) and 9(c) hereof.

          (e) Continuing Operation. Except as specifically provided in this Section 9, the
termination of Executive’s employment or of this Agreement will have no effect on the continuing
operation of this Section 9.

          (f) Additional Related Agreements. Executive agrees to sign and to
abide by the provisions of any additional agreements, policies or requirements of the Company
related to the subject of this Section 9 which are in writing and are developed by the
Company in the ordinary course of business.

     10. Release. Executive agrees, if his employment is terminated under circumstances
entitling him to payments under Section 7(a) of this Agreement, that in consideration for the
payments described in Section 7(a), he will execute a General Release in substantially the form
attached hereto as Exhibit A, through which Executive releases the Company from any and all claims
as may relate to or arise out of his employment relationship (excluding claims Executive may have
under any “employee pension plan” as described in Section 3(3) of ERISA or any claims under this
Agreement). The form of the Release may be modified as needed to reflect changes in the applicable
law or regulations that are needed to provide a legally enforceable and binding Release to the
Company at the time of execution.

7

 

     11. Indemnification and Insurance. Executive shall be indemnified and held harmless
by the Company during the term of this Agreement and following any termination of this Agreement
for any reason whatsoever in the same manner as would any other key management employee of the
Company with respect to acts or omissions occurring prior to (a) the termination of this Agreement
or (b) the termination of employment of Executive. In addition, during the term of this Agreement
and for a period of three years following the termination of this Agreement for any reason
whatsoever, Executive shall be covered by a Company held liability insurance policy, covering acts
or omissions occurring prior to (i) the termination of this Agreement or (ii) the termination of
employment of Executive.

     12. Arbitration; Legal Fees and Expenses. The parties agree that Executive’s
employment and this Agreement relate to interstate commerce, and that any disputes, claims or
controversies between Executive and the Company which may arise out of or relate to Executive’s
employment relationship or this Agreement shall be settled by arbitration. This agreement to
arbitrate shall survive the termination of this Agreement. Any arbitration shall be in accordance
with the Rules of the American Arbitration Association and undertaken pursuant to the Federal
Arbitration Act. Arbitration will be held in Oklahoma City, Oklahoma unless the parties
mutually agree on another location. The decision of the arbitrator(s) will be enforceable in any
court of competent jurisdiction. The parties agree that punitive, liquidated or indirect damages
shall not be awarded by the arbitrator(s) unless such damages would have been awarded by a
court of competent jurisdiction. Nothing in this agreement to arbitrate, however,
shall preclude the Company from obtaining injunctive relief from a court of competent jurisdiction
prohibiting any ongoing breaches by Executive of this Agreement including, without limitation,
violations of Section 9. If any contest or dispute arises between the
Company and Executive regarding any provision of this Agreement, the arbitrator shall award
to the prevailing party, the reasonable attorney fees, costs and expenses incurred by the
prevailing party in connection with such contest or dispute.

     13. Certain Additional Payments by the Company. Anything in this Agreement to the
contrary notwithstanding, in the event it is determined that any payment or distribution by the
Company to or for the benefit of the Executive, whether paid or payable or distributed or
distributable pursuant to the terms of this Agreement or otherwise, including, by example and not
by way of limitation, acceleration by the Company of the date of vesting or payment or rate of
payment under any plan, program or arrangement of the Company (a “Payment”), would be subject to
the excise tax imposed by Section 4999 of the Internal Revenue Code of 1986, as amended (the
“Code”) or any interest or penalties with respect to such excise tax (such excise tax, together
with any such interest and penalties, are hereinafter collectively referred to as the “Excise
Tax”), then the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”)
in an amount such that after payment by the Executive of all taxes (including any interest or
penalties imposed with respect to such taxes), including any Excise Tax, imposed upon the Gross-Up
Payment, the Executive retains an amount of the Gross-Up Payment equal to the Excise Tax imposed
upon the Payments. The amount of Gross-Up Payment to which the Executive is entitled under this
Section shall be determined by an accounting firm selected by the Company with the approval of the
Executive (the “Accounting Firm”). The Gross-Up Payment shall be paid within 60 days of the end of
the year in which it is determined that a payment to the Executive is subject to the Excise Tax.
Executive agrees to facilitate and cooperate with the Company’s defense of any assessment of tax,
interest
or penalty arising from any payment or distribution by the Company or acceleration of the
right

8

 

to benefits and Participant shall facilitate any claim for refund prosecuted by the Company
as to such matters.

     14. Agreement Binding on Successors.

          (a) Company’s Successors. No rights or obligations of the Company
under this Agreement may be assigned or transferred except that the Company will require any
successor (whether direct or indirect, by purchase, merger, reorganization, sale, transfer of
stock, consolidation or otherwise) to all or substantially all of the business and/or assets
of the Company to expressly assume and agree to perform this Agreement in the
same manner and to the same extent that the Company would be required to perform it if no
succession had taken place. As used in this Agreement, “Company” means the Company
as herein defined, and any successor to its or the Company’s business and/or
assets (by merger, purchase or otherwise) which executes and delivers the agreement provided for in
this Section 14 or which otherwise becomes bound by all the terms and provisions of this
Agreement by operation of law.

          (b) Executive’s Successors. No rights or obligations of Executive
under this Agreement may be assigned or transferred by Executive other than his rights to payments
or benefits under this Agreement, which may be transferred only by will or the laws of
descent and distribution. Upon Executive’s death, this Agreement and all rights of Executive
under this Agreement shall inure to the benefit of and be enforceable by Executive’s
beneficiary, or personal or legal representatives, or estate, to the extent any such
person succeeds to Executive’s interests under this Agreement. In the event of Executive’s death
or a judicial determination of his incompetence, reference in this Agreement to Executive shall be
deemed, where appropriate, to refer to his estate or other legal representative(s). If
Executive should die following his Date of Termination while any amounts would still be payable to
him under this Agreement if he had continued to live, unless otherwise
provided, all such amounts shall be paid in accordance with the terms of this Agreement
to his beneficiary or personal or legal representatives or estate.

     15. Notice. For the purposes of this Agreement, notices, demands and
all other communications provided for in this Agreement shall be in writing and shall be deemed to
have been duly given when delivered either personally or by United States certified or registered
mail, return receipt requested, postage prepaid, addressed as follows:

If to Executive:

At his last known address

evidenced on the Company’s

payroll records.

If to the Company:

Graymark Healthcare, Inc.

1350 Oklahoma Tower

210 Park Avenue

Oklahoma City, Oklahoma 73102

9

 

or to such other address as any party may have furnished to the other in writing in accordance
with this Agreement, except that notices of change of address shall be effective only
upon receipt.

     16. Withholding. All payments hereunder will be subject to any
required withholding of federal, state and local taxes pursuant to any applicable law or
regulation.

     17. Miscellaneous. No provisions of this Agreement may be amended, modified, or
waived unless agreed to in writing and signed by Executive and by a duly authorized
officer of the Company. No waiver by either party of any breach by the other party of any
condition or provision of this Agreement shall be deemed a waiver of similar or dissimilar
provisions or conditions at the same or at any prior or subsequent time. The respective rights and
obligations of the parties under this Agreement shall survive Executive’s
termination of employment and the termination of this Agreement to the extent necessary for the
intended preservation of such rights and obligations. The validity, interpretation, construction
and performance of this Agreement shall be governed by the laws of the State of Oklahoma
without regard to its conflicts of law principles.

     18. Validity. The invalidity or unenforceability of any provision or provisions
of this Agreement will not affect the validity or enforceability of any other provision of this
Agreement, which will remain in full force and effect.

     19. Counterparts. This Agreement may be executed in one or more counterparts,
each of which will be deemed to be an original but all of which together will constitute one and
the same instrument.

     20. Section Headings. The section headings in this Agreement are for convenience
of reference only, and they form no part of this Agreement and will not affect its
interpretation.

     21. Entire Agreement. Except as provided elsewhere herein and except for
the other documents and agreements contemplated in accordance herewith, this Agreement sets
forth the entire agreement of the parties with respect to its subject matter
and supersedes all prior agreements, promises, covenants, arrangements, communications,
representations or warranties, whether oral or written, by any officer, employee or representative
of any party to this Agreement with respect to such subject matter.

     22. Further Assurances. The parties hereby agree, without further consideration, to
execute and deliver such other instruments or to take such other action as may reasonably be
required to effectuate the terms and provisions of this Agreement.

[SIGNATURES ON FOLLOWING PAGE]

10

 

     IN WITNESS WHEREOF, the parties have executed this Agreement effective the
date first above written.

	 	 	 	 	 
	 	GRAYMARK HEALTHCARE, INC.

 	 
	 	By:  	/S/ STANTON NELSON
 	 
	 	 	Stanton Nelson, Chairman and Chief Executive 	 
	 	 	Officer 	 
	 

“COMPANY”

	 	 	 	 	 
	 	 	 
	 	 /S/ GRANT A. CHRISTIANSON
 	 
	 	Grant A. Christianson 	 
	 	 	 
	 

“EXECUTIVE”

11

 

EXHIBIT A

NOTICE. Various laws, including Title VII of the Civil Rights Act of 1964, the Civil Rights Act of
1866, the Pregnancy Discrimination Act of 1978, the Equal Pay Act, the Civil Rights Act of 1991,
the Age Discrimination in Employment Act, the Rehabilitation Act of 1973, the Americans With
Disabilities Act, the Employee Retirement Income Security Act and the Veterans Reemployment Rights
Act (all as amended from time to time), prohibit employment discrimination based on sex, race,
color, national origin, religion, age, disability, eligibility for covered employee benefits and
veteran status. You may also have rights under laws such as the Older Worker Benefit Protection
Act of 1990, the Worker Adjustment and Retraining Act of 1988, the Fair Labor Standards Act, the
Family and Medical Leave Act, the Occupational Health and Safety Act and other federal, state
and/or municipal statutes, orders or regulations pertaining to labor, employment and/or employee
benefits. These laws are enforced through the United States Department of Labor and its agencies,
including the Equal Employment Opportunity Commission (EEOC), and various state and municipal labor
departments, fair employment boards, human rights commissions and similar agencies.

This General Release is being provided to you in connection with the Employment Agreement between
you and Graymark Healthcare, Inc. with an effective date of August 1, 2009 (the “Agreement”). The
federal Older Worker Benefit Protection Act requires that you have at least twenty-one (21) days,
if you want it, to consider whether you wish to sign a release such as this one in connection with
a special, individualized severance package. You have until the close of business twenty-one (21)
days from the date you receive this General Release to make your decision. You may not sign this
General Release until, at the earliest, your official date of separation from employment.

BEFORE EXECUTING THIS GENERAL RELEASE YOU SHOULD REVIEW THESE DOCUMENTS CAREFULLY AND CONSULT WITH
YOUR ATTORNEY.

You may revoke this General Release within seven (7) days after you sign it and it shall not become
effective or enforceable until that revocation period has expired. If you do not accept the
severance package and sign and return this General Release, or if you exercise your right to revoke
the General Release after signing it, you will not be eligible for the special, individualized
severance package. Any revocation must be in writing and must be received by Graymark Healthcare,
Inc., 101 N. Robinson, Suite 920, Oklahoma City, OK 73102, within the seven-day period following
your execution of this General Release.

 

 

GENERAL RELEASE

In consideration of the special, individualized severance package offered to me by Graymark
Healthcare, Inc. and the separation benefits I will receive as reflected in the Employment
Agreement between me and Graymark Healthcare, Inc. with an effective date of August 1, 2009 (the
“Agreement”), I hereby release and discharge Graymark Healthcare, Inc. and its predecessors,
successors, affiliates, parent, subsidiaries and partners and each of those entities’ employees,
officers, directors and agents (hereafter collectively referred to as the “Company”) from all
claims, liabilities, demands, and causes of action, known or unknown, fixed or contingent, which I
may have or claim to have against the Company either as a result of my past employment with the
Company and/or the severance of that relationship and/or otherwise, and hereby waive any and all
rights I may have with respect to and promise not to file a lawsuit to assert any such claims.

This General Release includes, but is not limited to, claims arising under Title VII of the Civil
Rights Act of 1964, the Civil Rights Act of 1866, the Pregnancy Discrimination Act of 1978, the
Equal Pay Act, the Civil Rights Act of 1991, the Age Discrimination in Employment Act, the
Rehabilitation Act of 1973, the Americans With Disabilities Act, the Employee Retirement Income
Security Act or 1974 and the Veterans Reemployment Rights Act (all as amended from time to time).
This General Release also includes, but is not limited to, any rights I may have under the Older
Workers Benefit Protection Act of 1990, the Worker Adjustment and Retraining Act of 1988, the Fair
Labor Standards Act, the Family and Medical Leave Act, the Occupational Health and Safety Act and
any other federal, state and/or municipal statutes, orders or regulations pertaining to labor,
employment and/or employee benefits. This General Release also applies to any claims or rights I
may have growing out of any legal or equitable restrictions on the Company’s rights not to continue
an employment relationship with its employees, including any express or implied employment
contracts, and to any claims I may have against the Company for fraudulent inducement or
misrepresentation, defamation, wrongful termination or other retaliation claims in connection with
workers’ compensation or alleged “whistleblower” status or on any other basis whatsoever.

It is specifically agreed, however, that this General Release does not have any effect on any
rights or claims I may have against the Company which arise after the date I execute this General
Release or on any vested rights I may have under any of the Company’s qualified or non-qualified
benefit plans or arrangements as of or after my last day of employment with the Company, or on any
of the Company’s obligations under the Agreement or as otherwise required under the Consolidated
Omnibus Budget and Reconciliation Act of 1985 (COBRA).

I have carefully reviewed and fully understand all the provisions of the Agreement and General
Release, including the foregoing Notice. I have not relied on any representation or statement,
oral or written, by the Company or any of its representatives, which is not set forth in those
documents.

The Agreement and this General Release, including the foregoing Notice, set forth the entire
agreement between me and the Company with respect to this subject. I understand that my receipt
and retention of the separation benefits covered by the Agreement are contingent not only on my
execution of this General Release, but also on my continued compliance with my other

 

 

obligations under the Agreement. I acknowledge that the Company gave me twenty-one (21) days to
consider whether I wish to accept or reject the separation benefits I am eligible to receive under
the Agreement in exchange for this General Release. I also acknowledge that the Company advised me
to seek independent legal advice as to these matters, if I chose to do so. I hereby represent and
state that I have taken such actions and obtained such information and independent legal or other
advice, if any, that I believed were necessary for me to fully understand the effects and
consequences of the Agreement and General Release prior to signing those documents.

Dated this ____ day of                                         , ___.

	 	 	 	 	 
	 	 	 
	 	
 	 
	 
	 	_____________________ 	 
	 	 	 
	 

2

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00163-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00163-of-00352.parquet"}]]