Exhibit 10.3
                      TERMINATION AND CONSULTING AGREEMENT

     This   Termination  and  Consulting   Agreement  (the   "Agreement")   made
effectively  this 1st day of November,  2002  ("Effective  Date") by and between
Vasomedical,  Inc., a Delaware  Corporation  ("Employer" or  "Company"),  and D.
Michael  Deignan,  residing at 33 Cat Brier  Lane,  Hilton  Head  Island,  South
Carolina 29926 ("Employee") (collectively the "Parties").

     WHEREAS, the Parties entered into an employment agreement dated December 1,
2000 (the "Employment Agreement"); and

     WHEREAS,  the Parties are mutually  desirous of terminating  the Employment
Agreement on the terms and conditions set forth herein,  and otherwise  entering
into a consulting  arrangement (the  "Consulting  Arrangement") on the terms and
for the additional consideration described herein.

     NOW,  THEREFORE,  based upon the mutual covenants  contained herein and for
other  good and  valuable  consideration,  the  sufficiency  of which is  hereby
acknowledged, the Parties agree as follows:

     1. In accordance with paragraphs 4(a) and 6(c) of the Employment Agreement,
the  Employer  shall pay to Employee for the period from the  Effective  Date of
this Agreement to October 31, 2003 the sum of $240,000, payable in the manner in
which the  Employee's  annual salary is currently  being paid to the Employee by
the Employer.  All of the foregoing  payments shall be subject to deductions for
appropriate  federal,  state and local withholding taxes, Social Security taxes,
and any other charges  which by federal,  state and local law are required to be
deducted ("Severance Payment").

     2. (a)  During  the  period  commencing  on the  Effective  Date and ending
December  31,  2003 (the  "Consulting  Period"),  the  Employer  will retain the
Employee as a consultant to provide,  and the Employee agrees to provide,  up to
but not more than  forty  (40)  business  days of the  following  services  (the
"Services"):

     From time to time upon the reasonable request of senior level executives of
the Employer,  general advice or information  regarding potential  opportunities
for the  introduction  of the company's EECP systems,  the  Employer's  business
operations  and  affairs,   the  Employer's   current  and  potential   business
relationships   and   contractual   agreements   with   customers   and  lending
institutions,  pertinent  business  strategies,  personnel  matters,  and  other
related matters.

     In addition, as and to the extent reasonably  necessary,  the Employee will
provide  upon  request to the  Employer  and its  counsel  relevant  information
pertaining  to any matters  which are or will become the subject of  litigation,
and will cooperate  reasonably  with such counsel in connection with the conduct
of any such  litigation,  including,  but not  limited  to,  providing  relevant
testimonial  evidence by affidavit,  preparing for and attending an  examination
before trial, and appearing at trial as a witness on behalf of the Employer.

     (b) As consideration for the Services  described in Section 2 above and any
and all other  services  which the  Advisor  may render for and on behalf of the
Company that are not specifically  described  herein,  the Restrictive  Covenant
described in paragraph  4(a)  hereof,  and the Release  described in paragraph 5
hereof,  the Company  shall pay to the Employee the  following  compensation  in
addition to the Severance Payment described in paragraph 1 hereof.

          (i)  A  Consulting  Fee  (the  "Consulting  Fee")  in  the  amount  of
     $40,000.00  payable in 14 equal  installments of $2,857.14 per month on the
     first day of each such  month,  commencing  on  November 1, 2002 and ending
     December 31, 2003.
<PAGE>

          (ii) In addition to the  foregoing,  the Employee shall be entitled to
     be reimbursed  by the Employer for all  reasonable,  pre-approved  expenses
     incurred by him in connection with the performance of the Services upon the
     presentation of substantiating documentation therefor to the Employer.

          (iii) It is further  agreed between the Employer and the Employee that
     any options  which  otherwise  would have vested in the Employee  under the
     Employment  Agreement  pursuant to paragraph 4(b) thereof during the period
     from the  Effective  Date to December 31, 2003 had such  Agreement not been
     terminated,  shall vest during the  Consulting  Period in the manner and to
     the extent such options would have vested under the  Employment  Agreement,
     and be  exercisable  within three  months  after the end of the  Consulting
     Period.

     3. In the event of the Employee's death prior to full payment to him of the
Severance  Payment  under this  Agreement,  the Employer  nevertheless  shall be
required to pay the unpaid  balance of the Severance  Payment to the  Employee's
Estate at the times and in the same  manner in which the  Severance  Payment was
being paid to the  Employee  (the  "Death  Benefit"),  but shall have no further
obligation  with regard to payment of the unaccrued and unearned  balance of the
Consulting Fee.

     4. (a) The Employee  covenants and agrees that during the Consulting Period
and for a  period  of one  year  thereafter  (or such  longer  period  as may be
provided  therein) he shall abide by, and fully comply with,  the  provisions of
Paragraphs  8(a)  and  8(b) of the  Employment  Agreement  which  shall  survive
accordingly  and are fully  incorporated by reference  herein (the  "Restrictive
Covenant").

     (b) The Employee agrees further that in the event of a breach or threatened
breach of the  Restrictive  Covenant,  in  addition  to any other  remedies  the
Employer  may  have in  equity  or at law,  which  shall be  cumulative  and not
mutually exclusive,  the Employer shall be entitled to avail itself fully of the
enforcement  measures  set  forth in  Sections  9(a)  and (b) of the  Employment
Agreement,  which  shall  survive  accordingly  and are  fully  incorporated  by
reference herein.

     5. Subject only to the performance of, and compliance  with, the provisions
of this  Agreement,  as a material  inducement  to  Employer  to enter into this
Agreement,  Employee  hereby  waives,  remits,  releases and forever  discharges
Employer,  its Board  members,  officers,  directors,  stockholders,  employees,
agents, attorneys, subsidiaries,  servants, successors, insurers, affiliates and
their  successors  and  assignees,  from any and all manner of  action,  claims,
liens,  demands,  liabilities,  causes of  action,  charges,  complaints,  suits
(judicial,  administrative,  or otherwise), damages, debts, demands, obligations
of any other  nature,  past or present,  known or unknown,  whether in law or in
equity,  whether founded upon contract (expressed or implied),  tort (including,
but not  limited  to,  defamation),  statute or  regulation  (State,  Federal or
local),  common law and/or any other theory or basis,  from the beginning of the
world to the date hereof, including, but not limited to, any claim that Employee
has asserted,  now asserts or could have  asserted.  This  includes,  but is not
limited to, claims for compensation or benefits,  tortious claims arising out of
the  employment  relationship,  claims of an  expressed  or implied  contract of
employment,  claims under the Family and Medical Leave Act, claims arising under
Federal,  State or local laws prohibiting  employment or other discrimination or
claims  growing  out of any  legal  restrictions  on the  Employer's  rights  to
terminate its employees,  including without  limitation any claims arising under
Title VII of the United States Code,  and the Age  Discrimination  in Employment
Act. It is expressly  understood by Employee  that among the various  rights and
claims  being  waived by him in this  release  are those  arising  under the Age
Discrimination in Employment Act of 1967 (29 U.S.C.  621, et seq.).  Included in
this General Release are any and all claims for future damages allegedly arising
from the  alleged  continuation  of the effect of any past  action,  omission or
event.  Employee further agrees to waive any rights he may have to reinstatement
or reemployment with Employer (the "Release").

     6. (a) The  Employment  Agreement  shall be  terminated as of the Effective
Date hereof and neither party shall have any claim against the other  thereunder
except as herein expressly provided.

     (b) Consistent  with the foregoing,  the Employer will submit in writing to
the  Employer's  board of  directors  prior to the  Effective  Date,  his formal
resignation  as the Chief  Executive  Officer,  President  and a director of the
Employer effective as of the Effective Date.
<PAGE>

     7. It is recognized  and agreed that the Consulting  Arrangement  described
herein does not create or continue  the  relationship  of employer  and employee
between  the  Employee  and the  Company,  but rather,  that the  Services to be
performed  hereunder  shall  be  performed  by the  Employee  as an  independent
contractor.  Accordingly,  each of the parties  hereto agrees not to hold itself
out in any  manner  contrary  to the  terms  of this  Agreement  and none of the
parties  hereto shall be or become liable or bound by any  representation,  act,
omission or agreement whatsoever of any other party. Neither the Company nor the
Employee  shall have the right to make any contract or  commitment  on behalf of
the other or the authority to bind the other in any manner.

     8. Any action or  proceeding  brought to enforce any of the  provisions  of
this  Agreement  and/or to seek  other  relief  for  breach  thereof,  including
damages, must be instituted in a federal or state court situated in the State of
New York,  Nassau  County,  to the  jurisdiction  of which  courts,  the Parties
irrevocably and  unconditionally  submit.  This Agreement shall be construed and
governed by the laws of the State of New York,  without  regard to its governing
conflicts of law principles.

     9. (a) Except as required by law, the  Employer  and Employee  agree not to
publish,  communicate  or disseminate  any negative or  disparaging  information
regarding the other,  or to divulge,  directly or  indirectly,  any  information
regarding  this  Agreement  to the  media,  present or former  employees  of the
Employer,  suppliers,  vendors and other industry participants any other person;
provided,  however, that the Parties may disclose the contents of this Agreement
to their respective  financial  advisors,  accountants and attorneys.  As may be
appropriate, the Company shall be permitted additionally to make such disclosure
as may be appropriate  consistent with the Company's reporting requirements as a
public company.

     (b) Upon inquiry by any potential  employer of the  Employee,  the Employer
shall be required to provide only information  regarding the Employee's  salary,
the  Employee's  position  with the  Employer,  and the dates of the  Employee's
employment with the Employer.

     10.  This  Agreement  sets forth the  entire  agreement  and  understanding
between  the  parties  and  fully  supersedes  any and all prior  agreements  or
understandings  between  the parties  hereto  pertaining  to the subject  matter
hereof. All other contracts,  agreements or understandings  between the Employer
and Employee  whether oral or written are null and void.  The parties  represent
expressly that in signing this  Agreement,  they do not rely upon, nor have they
relied upon any representation or statement regarding the subject matter not set
forth specifically in this Agreement.

     11. Employee acknowledges that:

     (a) He has carefully  read and fully  understands  all of the provisions of
this Agreement.

     (b) By reason of this Agreement,  he is releasing the Employer from any and
all claims of any kind he may have against the Employer.

     (c) He agrees, knowingly and voluntarily,  to all of the terms set forth in
this Agreement and intends to be fully bound by the same.

     12. Any notice to be given to the Company or the Employee  hereunder  shall
be deemed  given if  delivered  personally,  telefaxed or mailed by certified or
registered  mail,  postage  prepaid,  to the other party hereto at the following
addresses:

        To the Company:         Vasomedical, Inc.
                                180 Linden Avenue
                                Westbury, New York 11590

        To Employee:            D. Michael Deignan
                                33 Cat Brier Lane
                                Hilton Head Island, South Carolina 29926
<PAGE>

Either  party may change the address to which  notice may be given  hereunder by
giving notice to the other party as provided herein.

     13.  This  Agreement  may not be  modified  or amended  except by a writing
signed by both Parties.  This agreement is not  assignable by the Employee,  and
otherwise  shall be binding  upon,  and inure to the benefit of, the  Employee's
successors, heirs, executors, administrators and legal representatives,  and the
Employer's successors and assigns.

     14. The  failure  of either  party to insist on strict  performance  of any
provision  or to  exercise  any  right  shall not be deemed a waiver of any such
provision or right thereafter.  Any waiver, to be effective,  must be in writing
and signed by the Party waiving compliance.

     15. Should any provisions of this Agreement be declared or determined to be
invalid or illegal,  the validity of the remaining,  terms and provisions  shall
not be affected  thereby and said illegal or invalid term or provision  shall be
deemed not to be part of this Agreement.

     16. This Agreement may be executed in counterparts.  Each counterpart shall
be  deemed  an  original,   and  when  taken  together  with  the  other  signed
counterpart, shall constitute one fully executed Agreement.


                                        /s/ D. Michael Deignan
                                        ----------------------
                                        D. MICHAEL DEIGNAN

                                        VASOMEDICAL, INC.

                                        By: /s/ Photios T. Paulson
                                        --------------------------
                                        Photios T. Paulson