<PAGE>
 

                   Number Nine Visual Technology Corporation
                              18 Hartwell Avenue
                              Lexington, MA 01273

                                                       October 6, 1997

John G. Thompson
10 Gilboa Lane
Nashua, NH 03062

Dear John:

     The purpose of this Letter Agreement is to confirm the terms of your 
separation from Number Nine Visual Technology Corporation ("Number Nine"), a 
Delaware corporation.  The severance pay and benefits described below are 
contingent on your agreement to and compliance with the terms of this Letter 
Agreement.  Based upon your stated willingness to enter into such an agreement, 
this Letter Agreement has been prepared which sets forth the specific 
understandings between you and Number Nine.

     1.   Resignation:  You hereby resign as the President, Chief Operating 
          ------------
Officer, member of the Board of Directors and any other position with Number 
Nine effective October 6, 1997 (the "Separation Date").  You acknowledge that 
from and after the Separation Date, you shall have no authority to represent 
yourself as an employee or agent of Number Nine and that you shall not represent
yourself in the future as an employee or agent of Number Nine.

     2.   Severance Pay and Benefits:  In exchange for the mutual covenants set 
          ---------------------------
forth in this Letter Agreement, and commencing on the eighth (8th) day following
your execution of this Letter Agreement (the "Effective Date") Number Nine 
agrees to provide you with continuation at Number Nine's expense of your 
participation in Number Nine's medical and dental insurance programs to the same
extent that such insurance is provided to persons employed by Number Nine until 
August 30, 1998.  You shall have the right to continue your medical and dental 
insurance after such date pursuant to the provisions of the Consolidated Omnibus
Budget Reconciliation Act of 1985 ("COBRA"); provided, however, the COBA period 
shall be deemed to have commenced on October 6, 1997.

     In recognition of the services you have provided to Number Nine, Number 
Nine agrees that prior to December 31, 1997 it will make a contribution of 
$40,000 to Monroe Community College Scholarship Foundation.  Number Nine will 
make not less than $20,000 of this contribution on or before October 15, 1997, 
an additional $10,000 on or before November 15, 1997 and an additional $10,000 
on or before December 15, 1997.  Number Nine will make the checks payable to 
Monroe Community College Scholarship Foundation and will deliver them to you for
delivery to Monroe Community College Scholarship Foundation.

     You expressly acknowledge and agree that the Severance Pay and Benefits
provided for herein are not otherwise due or owing to you under any employment
agreement (oral or written) or Number Nine policy or practice. You further
acknowledge that you have been paid and provided all wages, commissions,
bonuses, vacation pay, holiday pay and any other form of compensation, benefit
or reimbursement that may be due to you now or which would have become due in
the future in connection with your employment with or separation of employment
from Number Nine.


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     Without limiting the generality of the foregoing, you expressly acknowledge
and agree that the terms and conditions set forth in this Letter Agreement 
superceed the terms of that certain Letter Agreement between you and Number Nine
dated May 11, 1996, and that this Letter Agreement, together with that certain 
Non-Compete and Confidentiality Agreement dated May 15, 1996 between you and the
Company shall constitute the sole agreement between you and Number Nine.

     You further agree that through December 31, 1997 you shall be available, 
upon reasonable notice, either by telephone or, if Number Nine believes 
necessary, in person to assist Number Nine in any matter relating to the 
services performed by you during your employment with Number Nine.  You further 
agree that through such date and thereafter that you shall cooperate fully with 
Number Nine in the defense or prosecution of any claims or actions now in 
existence or which may be brought or threatened in the future against or on 
behalf of Number Nine, including any claims or actions against its officers, 
directors and employees.  Your cooperation in connection with such claims or 
actions shall include, without limitation, your being reasonably available (and,
to the extent possible, outside of work obligations you may have) to meet with 
Number Nine in connection with any regulatory matters, to prepare for any 
proceeding (including, without limitation, depositions, consultation, discovery 
or trial), to provide affidavits, to assist with any audit, inspection, 
proceeding or other inquiry, and to act as a witness in connection with any 
litigation or other legal proceeding affecting Number Nine.  You further agree 
that should you be contacted (directly or indirectly) by any party representing 
a party adverse to Number Nine, you shall promptly (within 48 hours) notify 
Michael Albanese at Number Nine.

     3.  Property:  Number Nine acknowledges that you have in your possession 
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two chairs which are the property of Number Nine.  Effective on the eighth (8th)
day following your execution of this Letter Agreement, Number Nine transfers to 
you such chairs.  Except for such chairs, you represent that you have returned 
to Number Nine all property of every kind and nature belonging to Number Nine in
your possession.

     4.  Stock Rights:  The parties hereby incorporate by reference the terms 
         ------------
and conditions of the Stock Options granted to you under the Number Nine 
Computer Corporation 1996 Employee, Director and Consultant Stock Option Plan 
(the "1996 Options").  The parties further agree that as of the date hereof, a 
total of 137,500 options are vested and that you may exercise such options at a 
price of $3.07 per share only on or after December 31, 1997 and that all of such
options will terminate on January 6, 1998, and that from and after the date 
hereof, and notwithstanding any of the terms of the option agreements to the 
contrary, no further options shall vest.  You acknowledge and agree that you 
shall not buy or sell any shares of Number Nine stock including, but not limited
to, any shares acquired by you upon exercise of options that you may exercise 
under the 1996 Options, until the November 1997 trading window.  Except for the 
foregoing, you acknowledge and agree that you do not have now, and shall not in 
the future have, any rights in, including any rights to vest in, any stock 
options under any Number Nine stock or stock option plan (of whatever name or 
kind) that you participated in or were eligible to participate in during your 
employment.

     5.  Confidentiality/Non-Competition/Non-Solicitation:  You hereby agree and
         ------------------------------------------------
acknowledge the following:

     (i)  that you shall abide by any and all common law and/or statutory 
obligations relating to protection and non-disclosure of Number Nine's trade 
secrets and/or 

                                      -2-
<PAGE>
 
     confidential and proprietary documents and information (including, but not
     limited to, any information regarding Number Nine's financial conditions,
     products, product development, sales and any other similar information, but
     excluding information that is publicly available, and that you have and
     shall continue to abide by the convenants set forth in the "Noncompete and
     Confidentiality Agreement" dated May 15, 1996 (which agreement is attached
     hereto as Exhibit A and incorporated herein by reference).

     (ii)  that all information relating in any way to the subject matter of
     this Agreement, including the terms and amount of this Agreement, shall be
     held confidential by you and shall not be publicized or disclosed to any
     person (other than an immediate family member, legal counsel or financial
     advisor, provided that any such individual to whom disclosure is made
     agrees to be bound by these confidentiality obligations), business entity
     or government agency (except as mandated by state or federal law).

     (iii) that you shall not make any statements that are disparaging about or
     adverse to the business interests of Number Nine (including its officers,
     directors and employees) or which are intended to harm the reputation of
     Number Nine including, but not limited to, any statements that disparage
     any product, service, finances, financial condition, capability or any
     other aspect of the business of Number Nine.

     (iv)  that the breach of any of the foregoing covenants by you shall
     constitute a material breach of this Agreement and shall relieve Number
     Nine of any further obligations hereunder and, in addition to any other
     legal or equitable remedy available to Number Nine, shall entitle Number
     Nine to recover any monies already paid to you pursuant to paragraph 2 of
     this Agreement.

     6.  Release of Claims:  You hereby agree and acknowledge that by signing 
         ------------------
this Letter Agreement and accepting the Severance Pay and Benefits, and other 
good and valuable consideration provided for in this Letter Agreement, you are 
waiving any right to assert any form of legal claim against Number Nine (which 
term shall be deemed to include its divisions, affiliates and subsidiaries and 
all related entities, and its and their officers, directors, employees, agents, 
attorneys, contractors, successors and assigns) of any kind whatsoever arising 
from the beginning of time through the Effective Date.  Your waiver and release 
is intended to bar any form of legal claim, charge, complaint or any other form 
of action (jointly referred to as "Claims") against Number Nine seeking any form
of relief including, without limitation, equitable relief (whether declaratory, 
injunctive or otherwise), the recovery of any damages or any other form of 
monetary recovery whatsoever (including, without limitation, back pay, front 
pay, compensatory damages, emotional distress damages, punitive damages, 
attorneys fees and any other costs) against Number Nine up through the 
Effective Date.  You understand that there could be unknown or unanticipated 
claims resulting from your employment with Number Nine and the termination 
thereof and agree that such claims are intended to be and are included in this 
waiver and release.  Furthermore, you agree not to participate in any Claims, 
and waive any recovery for any Claims, brought on your behalf by a third party 
against Number Nine.

     Without limiting the foregoing general waiver and release, you specifically
waive and release Number Nine from any Claim arising from or related to your 
employment relationship with Number Nine or the termination thereof, including, 
without limitation:

                                      -3-

<PAGE>
 
     **   Claims under any state or federal discrimination related statute,
          regulation or executive order, fair employment practices or other
          employment related statute, regulation or executive order (as they may
          have been amended through the Effective Date) prohibiting
          discrimination or harassment based upon any protected status
          including, without limitation, race, national origin, age, gender,
          marital status, mental or physical disability, veteran status or
          sexual orientation. Without limitation, specifically included in this
          paragraph are any Claims arising under the Massachusetts Fair
          Employment Practices Statute, the Massachusetts Civil Rights Acts, the
          Massachusetts Equal Protection Act, the Federal Age Discrimination in
          Employment Act, the Older Workers Benefit Protection Act, the Civil
          Rights Act of 1991, the Equal Pay Act and the Americans with
          Disabilities Act.

     **   Claims under any other state or federal employment related statute,
          regulation or executive order (as they may have been amended through
          the Effective Date) relating to wages, hours or any other terms and
          conditions of employment. Without limitation, specifically included in
          this paragraph are any Claims arising under the Fair Labor Standards
          Act, the Family Medical Leave Act of 1993, the National Labor
          Relations Act, the Employee Retirement Income Security Act of 1974,
          the Consolidated Omnibus Budget Reconciliation Act of 1985 and any
          similar state statute.

     **   Claims under any state or federal common law theory, including,
          without limitation, wrongful discharge, breach of express or implied
          contract, promissory estoppel, unjust enrichment, breach of a covenant
          of good faith and fair dealing, violation of public policy,
          defamation, interference with contractual relations, intentional or
          negligent infliction or emotional distress, invasion of privacy,
          misrepresentation, deceit, fraud or negligence.

     **   Any other Claim arising under state or federal law, including, without
          limitation, unfair and deceptive trade practices statutes.

     Nothwithstanding the foregoing, this paragraph shall not release Number
Nine from any obligation expressly set forth in this Letter Agreement, nor
shall it release Number Nine from the ongoing indemnification obligations set
forth in the Certificate of Incorporation or Bylaws of Number Nine.

     You acknowledge and agree that, but for providing this waiver and release,
you would not be receiving the Severance Pay and Benefits. You further
acknowledge and agree that the provision to you of the Severance Pay and
Benefits is not, and is not intended to be, an admission of any liability on the
part of the parties hereby released or an indication that they expect any
liability to hereafter arise, and that such releases deny any liability.

     Number Nine and you hereby acknowledge that because you are over 40 years
of age, you are granted specific rights under the Older Workers Benefit
Protection Act ("OWBPA"), which prohibits discrimination on the basis of age,
and that the release set forth in this section is intended to release any right
that you have to file a claim against Number Nine alleging discrimination on the
basis of age. Consistent with the provisions of OWBPA, Number Nine is providing
you with twenty-one (21) days in which to consider and accept the terms of this
Letter

                                      -4-

<PAGE>
 
Agreement by signing below.  In addition, you may rescind your assent to this 
Agreement if, within seven (7) days after the date you sign this Letter 
Agreement, you deliver a notice of recision to Michael Albanese at Number Nine. 
To be effective, such recision must be hand delivered or postmarked within the 
seven (7) day period and sent by certified mail, return receipt requested, to 
Michael Albanese, Human Resources, Number Nine Visual Technology Corporation at 
18 Hartwell Avenue, Lexington, MA 02173.

     7.  Entire Agreement/Choice of Law/Full Agreement: Except as expressly 
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provided for in this Letter Agreement (e.g., your obligations set forth in the 
                                       ---
your Confidentiality and Noncompetition Agreement), this Letter Agreement 
supersedes any and all prior oral and/or written agreements, and sets forth the 
entire agreement between you and Number Nine.  No variations or modifications 
hereof shall be deemed valid unless reduced to writing and signed by the parties
hereto.  This Letter Agreement shall take effect as an instrument under seal 
and shall be governed by and construed in accordance with the laws of the 
Commonwealth of Massachusetts.  The provisions of this Letter Agreement are 
severable, and if for any reason any part hereof shall be found to be 
unenforceable, the remaining provisions shall be enforced in full.

     It is Number Nine's desire and intent to make certain that you fully 
understand the provisions and effects of this Letter Agreement.  To that end, 
you have been encouraged and given the opportunity to consult with legal 
counsel.  By executing this Letter Agreement, you are acknowledging that you 
have been afforded sufficient time to understand the terms and effects of this 
Letter Agreement, that your agreements and obligations hereunder are made 
voluntarily, knowingly and without duress and that neither Number Nine nor its 
agents or representatives have made any representations inconsistent with the 
provisions of this Letter Agreement.

     If the foregoing correctly sets forth our understanding, please sign, date 
and return the enclosed copy of this Letter Agreement to Mike Albanese at Number
Nine.

                                            Very truly yours,             
                                                                          
                                            Number Nine Visual Technology 
                                            Corporation                   

                                                                          
                                            By: /s/ Michael Albanese      
                                                -------------------------
                                                Michael Albanese           


Confirmed and Agreed:
John G. Thompson 

/s/ John G. Thompson  
--------------------


Dated: 10/6/97
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