Document:

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                                                                    Exhibit 10.3

                 SEVERANCE AND SETTLEMENT AGREEMENT AND RELEASE
                 ----------------------------------------------

     AGREEMENT made as of this 8th day of April, 2000, by and between NMT
Medical, Inc. (the "Company") and Thomas M. Tully (the "Employee").

     WHEREAS, the parties wish to resolve amicably the Employee's separation
from the Company and establish the terms of the Employee's severance
arrangement;

     NOW, THEREFORE, in consideration of the promises and conditions set forth
in this Agreement and Release, the sufficiency of which is acknowledged, the
Company and the Employee agree as follows:

     1.  Termination Date. The Employee's effective date of termination from
         ----------------
full-time employment as President and Chief Executive Officer of the Company is
April 8, 2000 (the "Termination Date"). The Employee hereby resigns, and upon
request of the Company agrees to execute and deliver a further written
resignation, from all positions held with the Company except that described in
the separate Employment Agreement executed with the Company on this same date.

     2.  Monetary and other Consideration.
         --------------------------------
     (a) In return for the execution of this Agreement and Release, the Company
agrees to: pay the Employee (i) a total of $278,650 in 24 equal semi monthly
payments of $11,610.42; and (ii) 11,626.90 for accrued and unused vacation.
Employee understands that the foregoing amounts are not being paid to him as an
employee and will be paid without withholding. The Company shall furnish a Form
1099 for payments made pursuant to Section 2(a)(i). The amount of accrued and
unused vacation will be paid to the Employee in a lump-sum on May 1, 2000.
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     (b)  In addition to the monetary consideration described above, the Company
agrees to:

          (i) pay all medical, prescription, dental, and life insurance premiums
for Employee coverage currently in effect through April 8, 2000;

     3.  Release.  By executing this Agreement and Release, the Employee fully,
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forever, irrevocable and unconditionally releases, remises and discharges the
Company, its officers, directors, stockholders, corporate affiliates, agents and
employees from any and all claims, charges, complaints, demands, actions, causes
of action, suits, rights, debts, sums of money, costs, accounts, reckonings,
covenants, contracts, agreements, promises, doings, omissions, damages,
executions, obligations, liabilities, and expenses (including attorneys' fees
and costs), of every kind and nature which he ever had or now has against the
Company, its officers, directors, stockholders, corporate affiliates, agents and
employees, including, but not limited to, all claims arising out of his
employment, all employment discrimination claims under Title VII of the Civil
Rights Act of 1964, 42 U.S.C. (S)2000e et seq., the Age Discrimination in
Employment Act, 29 U.S.C. (S)621 et seq., the Americans With Disabilities Act,
42 U.S.C. (S)12101 et seq., the Massachusetts Fair Employment Practices Act,
M.G.L. c.151B, (S)1 et seq., all claims arising out of the Massachusetts Civil
Rights Act, M.G.L. c.12 (S)(S)11H and 11I, the Massachusetts Equal Rights Act,
c.93 (S)102 and M.G.L. c. 214, (S)1C, all damages arising out of all employment
discrimination claims, wrongful discharge claims or other common law claims and
damages.

     4.  Nature of Agreement.  The Employee understands and agrees that this
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Agreement and Release is a severance and settlement agreement and does not
constitute an admission of liability or wrongdoing on the part of the Company.

     5.  Amendment. This Agreement shall be binding upon the parties and may not
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be abandoned, supplemented, changed or modified in any manner, orally or
otherwise, except by an instrument in writing of concurrent or subsequent date
signed by a duly authorized representative

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of the parties hereto. This Agreement is binding upon and shall inure to the
benefit of the parties and their respective agents, assigns, heirs, executors,
successors and administrators.

     6. Validity. Should any provision of this Agreement and Release be declared
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or be determined by any court of competent jurisdiction to be illegal or
invalid, the validity of the remaining parts, terms, or provisions shall not be
affected thereby and said illegal and invalid part, term or provision shall be
deemed not to be a part of this Agreement and Release.

     7. Confidentiality. The Employee understands and agrees that the terms and
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contents of this Agreement and Release, and the contents of the negotiations and
discussions resulting in this Agreement and Release, shall be maintained as
confidential by the Employee, his agents and representatives, and none of the
above shall be disclosed except to the extent required by federal or state law
or as otherwise agreed to in writing by the authorized agent of each party. In
addition, the Employee acknowledges that the Employee Nondisclosure and Secrecy
Agreement, dated as of September 1, 1995, between the Employee and the Company
(the "Nondisclosure Agreement") remains in full force and effect.

     8. Non-Competition; Non-Solicitation. The Employee and the Company
        ---------------------------------
acknowledge and agree that the Employee shall continue to be bound by the
provisions of Sections 7 and 8 of the Employment Agreement, dated January 1,
1999, by and between the Employee and the Company (the "Employment Agreement")
and that Sections 7 and 8 of the Employment Agreement remain in full force and
effect.

     9. Entire Agreement. This Agreement, the Nondisclosure Agreement, Sections
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7 and 8 of the Employment Agreement and the Employment Agreement dated April 8,
2000 between the Company and the Employee, contain and constitute the entire
understanding and agreement between the parties hereto with respect to severance
and settlement and cancel all previous oral and written negotiations,
agreements, commitments, and writings in connection with such matters.

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     10. Applicable Law.  This Agreement shall be governed by the laws of The
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Commonwealth of Massachusetts.

     11. Acknowledgments. The Employee acknowledges that he has been given
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twenty-one (21) days to consider this Agreement and that the Company advised him
to consult with an attorney of his own choosing prior to signing this Agreement.
The Employee may revoke this Agreement for a period of seven (7) days after the
execution of this Agreement, and the Agreement shall not be effective or
enforceable until the expiration of this seven (7) day revocation period.

     12. Voluntary Assent.  The Employee affirms that no other promises or
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agreements of any kind have been made to or with him by any person or entity
whatsoever to cause him to sign this Agreement, and that he fully understands
the meaning and intent of this Agreement.  The Employee states and represents
that he has had an opportunity to fully discuss and review the terms of this
Agreement with an attorney.  The Employee further states and represents that he
has carefully read this Agreement, understands the contents herein, freely and
voluntarily assents to all of the terms and conditions hereof, and signs his
name of his own free act.

     13. Counterparts.  This Agreement may be executed in two (2) signature
         ------------
counterparts, each of which shall constitute an original, but all of which taken
together shall constitute but one and the same instrument.

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       IN WITNESS WHEREOF, all parties have set their hand and seal to this
Agreement as of the date written above.

NMT MEDICAL, INC.

/s/ C. Leonard Gordon
----------------------
By:  C. Leonard Gordon                   Date:  April 8, 2000
Its:   Acting President                         -------------

/s/ Thomas M. Tully
--------------------
Thomas M. Tully                          Date:  April 8, 2000
                                                -------------

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                                                                    Exhibit 10.4

                                 May 19, 2000

NMT Medical, Inc.
27 Wormwood Street
Boston, MA 02210

     Re:  Waiver of Compliance with Certain Covenants
          -------------------------------------------

Ladies and Gentlemen:

     Reference is made to (i) that certain Credit Agreement, dated as of
September 13, 1999, as amended (the "Credit Agreement"), by and among NMT
Medical, Inc. ("NMT") and its domestic subsidiaries (together with NMT, the
"Borrowers") and Brown Brothers Harriman & Co. (the "Lender") and (ii) that
certain letter agreement regarding the post-closing delivery of certain
documentation and the satisfaction of certain conditions, dated September 13,
1999 (the "Letter Agreement").  Capitalized terms used herein and not defined
shall have the meanings ascribed to such terms in the Credit Agreement.

     The Borrowers have delivered to the Lender in connection herewith
calculations regarding compliance with the financial covenants set forth in
Section 6.09 of the Credit Agreement for the first quarter of 2000 (the
"Calculations").  Based on the Calculations, the Borrowers were not in
compliance with the financial covenants set forth in Sections 6.09(a), (b) and
(d) of the Credit Agreement.  The Lender hereby waives the Borrowers' compliance
with the financial covenants set forth in the Credit Agreement, but only to the
extent of the deviations from the relevant financial covenants set forth in the
Calculations and the Borrowers' failure to comply with such covenants for the
first quarter of 2000.

     In addition, as of the date hereof, the Borrowers have not delivered the
pledge of the stock of Image Technology Corp. (together with related stock
powers executed in blank), which items are required to be delivered to the
Lender on or before May 31, 2000 in accordance with the terms of the Letter
Agreement, as modified by that certain Waiver and Consent Agreement, dated as of
March 20, 2000 (the "Waiver and Consent"), by and among the Lender, Whitney
Subordinated Debt Fund, L.P. ("Whitney"), J.H. Whitney & Co. ("JHW") and the
Borrowers.  The Lender hereby agrees to extend the date of delivery for the
remaining documentation under the Letter Agreement to on or before July 31,
2000.  The Borrowers acknowledge and agree that if all of the documentation
required to be delivered under the Letter Agreement and all of the conditions
required to be satisfied as set forth therein are not so delivered and satisfied
on or before July 31, 2000, it shall constitute an immediate Event of Default
under the Credit Agreement.
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     This waiver applies only with respect to the Borrowers' non-compliance with
the provisions of the Credit Agreement described herein, and nothing contained
herein or in any other communication between any Borrower and the Lender shall
constitute a consent to any other deviation from the terms of the Credit
Agreement.  Nothing contained in this waiver shall be deemed to modify or amend
the Credit Agreement, which remains in full force and effect, or constitute a
course of dealing among the Borrowers and the Lender.

     By their acknowledgment in the spaces provided below, (i) the Borrowers
hereby confirm to the Lender that the representations and warranties of the
Borrowers set forth in Article III of the Credit Agreement are true and correct
as of the date hereof as if set forth herein in full, except to the extent that
such representations and warranties are no longer true and correct as a result
solely of the consummation of the Sale Transactions (as defined in the Waiver
and Consent), and (ii) the Borrowers hereby certify that, after giving effect to
this waiver, no Default exists under the Credit Agreement.

     This waiver is conditioned upon, and shall be effective only
contemporaneous with, the granting and effectiveness of a waiver by Whitney
under that certain Subordinated Note and Stock Purchase Agreement, dated as of
July 8, 1998, by and among NMT, Whitney and, for limited purposes, JHW, as
amended (the "Whitney Agreement"), with respect to NMT's failure to comply with
the financial covenants set forth in Sections 9.8(a), (b) and (d) of the Whitney
Agreement.

                  [Remainder of Page Intentionally Left Blank]

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                                    Very truly yours,

                                    BROWN BROTHERS HARRIMAN & CO.

                                    By: /s/ Louise A. Coughlan
                                       ----------------------------
                                       Name: Louise A. Coughlan
                                       Title: Senior Vice President

ACKNOWLEDGED AND AGREED:

NMT MEDICAL, INC.

By: /s/ William J. Knight
   ----------------------
    Name: William J. Knight
    Title: Vice President-Finance and
           Administration and Chief
           Financial Officer

NMT HEART, INC.

By: /s/ William J. Knight
    ---------------------
    Name: William J. Knight
    Title: Treasurer and Secretary

NMT INVESTMENTS CORP.

By: /s/ William J. Knight
    ---------------------
    Name: William J. Knight
    Title: Treasurer and Clerk

NMT NEUROSCIENCES
(INTERNATIONAL), INC.

By: /s/ William J. Knight
    ---------------------
    Name: William J. Knight
    Title: Treasurer and Secretary

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NMT NEUROSCIENCES (US), INC.

By: /s/ William J. Knight
    ---------------------
    Name: William J. Knight
    Title: Treasurer and Secretary

NMT NEUROSCIENCES (IP), INC.

By: /s/ William J. Knight
    ---------------------
    Name: William J. Knight
    Title: Treasurer and Secretary

NMT NEUROSCIENCES
INNOVASIVE SYSTEMS, INC.

By: /s/ William J. Knight
    ---------------------
    Name: William J. Knight
    Title: Treasurer and Secretary

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