NONSTATUTORY STOCK OPTION
                                ACCEPTANCE LETTER
                                -----------------
                        (also referred to as "Agreement")

TO:  B. Yeshwant Kamath                                     Grant Date:  3/23/98

         We are  pleased to notify you (also  referred  to as  "Optionee")  that
VIDEONICS, INC., a California corporation (the "Company"),  hereby grants to you
an option  ("Option") to purchase all or any part of 320,000 shares (although no
fractional  shares may be  purchased)  of the Common Stock of the Company at the
price of $2.125 per share (the  "Exercise  Price") and  "Optioned  Shares") as a
Nonstatutory  Stock Option authorized by the Board of Directors.  A Nonstatutory
Stock Option is an option not  described in Section 422 of the Internal  Revenue
Code of 1986, as amended (the "Code").

         This Option cannot be exercised  unless you first sign this document in
the place  provided  and return it to the  Assistant  Secretary  of the Company,
James A. McNeill. However, your signing and delivering this letter will not bind
you to purchase  any of the shares  subject to the Option.  Your  obligation  to
purchase  shares  arises  only when you  exercise  this Option in the manner set
forth in Paragraph 1 below.

         1. Term of Option  and  Exercise  of  Option.  Subject to the terms and
conditions of this Acceptance Letter, this Option can be exercised by you during
a period of ten (10)  years from the Grant  Date.  Your  first  vesting  date is
5/31/98,  with 40,000 shares  becoming  vested on that date.  40,000 shares will
vest every six months thereafter until the final vesting date of 11/30/2001,  at
which point all shares will be vested, provided that you have remained a Company
employee  throughout  such period or unless you and the Company  have  otherwise
agreed in a writing singed by an authorized Company officer.

         Any portion of the Option that you do not exercise shall accumulate and
can be  exercised  by you at any time prior to the  exception  of ten (10) years
from the Grant Date.

         This Option may be exercised by delivering  to the Assistant  Secretary
of the Company full payment for an amount equal to the total  Exercise  Price of
such shares being  exercised  and a written  notice in a form  substantially  as
attached  hereto or otherwise  satisfactory  to the  Company,  signed by you and
specifying the number of shares you then desire to purchase.

         Upon receipt of your notice to exercise shares, the Company will advise
you of any additional amount which may be due for federal and state taxes on the
difference  between your Exercise Price and the current fair market value of the
Company's stock on the exercise date. You acknowledge your personal liability to
pay said taxes and that Company has no obligation to deliver any Optioned Shares
or other  payments  to you  upon  the  exercise  of the  Option  and sale of any
Optioned Shares without payment of such taxes.

         Certificates  for  shares  so  purchased  will  be  issued  as  soon as
practicable,  but no fractional  shares shall be  delivered.  As a holder of the
Option,  you shall have no rights of a


<PAGE>

shareholder  with  respect to the  Optioned  Shares until shares shall have been
issued to you upon the exercise of this Option.

         The Company shall not be obligated to deliver any shares  hereunder for
such period as may be required by it with  reasonable  diligence  to comply with
applicable  federal or state  statutes,  laws and  regulations.  As of the Grant
Date,  you  understand  that the Option and the  Optioned  Shares  have not been
registered under the Securities Act of 1933 and the rules and regulations of the
Securities and Exchange Commission ("SEC") promulgated  thereunder.  You further
understand  that absent  such  registration  or the  obtaining  of an  exemption
therefrom,  the Optioned Shares may not be sold or transferred for value. In its
discretion, the Company will use reasonable efforts to cause the Optioned Shares
to be  registered  under a Form S-8,  S-3 or other SEC form  described  for such
purpose within the four (4) year term of the Option vesting period.  You further
understand  that as an  executive  officer  and  director  of the  Company,  any
exercise  of shares  under this Option  shall be subject to the insider  trading
regulations  and rules as are promulgated by the SEC from time to time, and that
violation thereof may create criminal or civil liabilities and penalties.

         2.  Termination  of  Employment.  Subject  to other  written  agreement
between  you and the  Company,  if your full time  employment  with the  Company
terminates  for any reason  other than death or  disability,  this Option may be
exercised  only within  three (3) months of such event to the extent that is was
vested on the date of termination,  but in no event may this Option be exercised
after ten (10) years from the Grant Date. If you are granted a leave of absence,
you shall be deemed to be still in the employ of the  Company,  except  that you
may not exercise the Option  during such leave of absence.  Additional  terms in
your employment  letter modify this clause.  You shall have no right to exercise
any Optioned Shares which have not vested as of the termination date.

         3. Death or  Disability.  If you die or are disabled  while employed by
the  Company,  this  Option  may be  exercised  in  whole or in part by the duly
authorized executor of your last Will or by the duly authorized administrator or
special administrator of your estate, as the case may be, within a period of one
(1) year, or for such longer period as the Company's Board of Directors may fix,
at its discretion, but only to the extent that the Option was vested on the date
of your death or  disability,  again  subject to exercise no more than after ten
(10) years from the Grant Date.  Your estate  shall mean  yourself or your legal
representative  or any person who acquires  the right to exercise an Option,  as
the case may be, by reason of your death or disability.

         4. Non-transferability of Option. This Option shall not be transferable
except by Will or the laws of descent and  distribution,  and this Option may be
exercised during your lifetime only by you. Any purported transfer or assignment
of this Option  shall be void and of no effect,  and in such  circumstance,  the
Company  shall have the right to  terminate  this  Option as of the date of such
purported transfer or assignment.

         5. Method of Exercise. This Option may be exercised with respect to all
or any part of any vested  Optioned  Shares by giving the Company written notice
of such exercise,  specifying the number of shares as to which this Option is so
exercised and accompanied by cash,  check, bank draft, or money order payable to
the order of the  Company  for an amount in


                                       2

<PAGE>

lawful money of the United States equal to the Exercise Price  multiplied by the
number of said shares. You may also exercise the vested Optioned Shares by using
any increase in the value of the Optioned Shares in excess of the Exercise Price
for the number of shares as to which you exercise the Option.  In such instance,
you shall  receive a number of shares equal to the  difference  in value between
fair market on the exercise date and the Exercise Price for the Optioned  Shares
being  exercised,  subject to any  deduction  also being taken as  required  for
income taxes due on the difference which the Company is required to withhold.

         As soon as practical  after receipt of such notice,  and payment of any
taxes due, the Company shall,  without transfer or issue tax or other incidental
expense to you or your successor,  transfer and deliver thereto at the office of
the Company or such other place as may be mutually  agreeable a  certificate  or
certificates for such shares of its common stock;  provided,  however,  that the
time of such  delivery may be postponed by the Company for such period as may be
required for it with reasonable diligence to comply with applicable registration
requirements  under  the  Securities  Exchange  Act of  1934,  as  amended,  any
applicable  listing  requirements  of  any  national  securities  exchange,  and
requirements  under any other laws or regulations  applicable to the issuance or
transfer of such shares.

         6.  Adjustments  Upon  Changes in  Capitalization.  In the event of any
change  in the  outstanding  Common  Stock of the  Company  by  reason  of stock
dividends, recapitalization,  mergers, consolidations, split-up, combinations or
exchanges  of  shares  and the  like,  the  aggregate  number or class of shares
subject to this Option  immediately  prior to such event and the Exercise  Price
shall be  appropriately  adjusted by the Board of  Directors  on a  proportional
basis so that the total  Exercise  Price and the economic  benefits to which you
are  entitled  upon  exercise of the Option  shall  remain the same and any such
adjustment  by the Board of  Directors  in good faith shall be  conclusive.  For
example,  if the Company splits its  outstanding  Common Stock 2:1 such that for
every  outstanding  share, one new share is issued,  then the number of Optioned
Shares then  remaining  unexercised  under the Option  shall  double and the per
share  Exercise  Price shall be one-half of the prior  price.  By way of further
example, if the Company combines its outstanding Common Stock in a reverse stock
split on a 1:2 basis such that for every two shares  outstanding  only one share
remains  outstanding,  then the number of Optioned Shares remaining  unexercised
under the Option shall be reduced by half and the per share Exercise Price shall
double.

         7. Tax  Status.  Your  treatment  of shares  purchased  pursuant to the
exercise of the Option thereafter may have significant tax consequences. You may
wish to consult  your tax advisor with  respect to the tax  consequences  to you
upon  exercise of the Option or sale of the stock that you  acquire  pursuant to
this Option. You alone are responsible for any tax liability associated with the
exercise of the Optioned Shares.

         8. Accredited  Investor.  Optionee  represents that he is an accredited
investor  as  defined  in Rule  501(a) of  Regulation  D  promulgated  under the
Securities  Act.  Optionee  hereby  confirms  that the Option (and Common  Stock
issuable  upon  exercise  thereof)  will  be  acquired  for  investment  for the
Optionee's  own account,  not as a nominee or agent,  and not with a view to the
resale or distribution of any part thereof, and that the Optionee has no present
intention of selling,  granting any participation in, or otherwise  distributing
the same. By executing this


                                       3

<PAGE>

Agreement, Optionee further represents that Optionee does not presently have any
contract,  undertaking,  agreement  or  arrangement  with  any  person  to sell,
transfer or grant  participations  to such person or to any third  person,  with
respect to any of the Option or Optioned Shares. The Optionee represents that he
has full power and authority to enter into this Agreement.

         9.  Disclosure  of  Information.  Optionee  has had an  opportunity  to
discuss the Company's business, management,  financial affairs and the terms and
conditions of the offering of the Option with the Company's  management  and has
had an opportunity to review the Company's facilities. Optionee understands that
such discussions, as well as the written information issued by the Company, were
intended to describe the aspects of the Company's  business which it believes to
be material. Optionee is an executive officer of the Company and a member of the
Company's Board of Directors.

         10.  Restricted  Securities.  Optionee  understands that the Option and
Option  Shares have not been  registered  under the  Securities  Act of 1933, as
amended (the "Securities Act").  Optionee understands that the Option and Option
Shares are characterized as "restricted securities" under the federal securities
laws inasmuch as they are being  acquired from the Company in a transaction  not
involving a public offering and that under such laws and applicable  regulations
such  Option and  Option  Shares may be resold  without  registration  under the
Securities Act only in certain limited circumstances. Optionee acknowledges that
the Option and  Option  Shares  must be held  indefinitely  unless  subsequently
registered  under the Securities Act or an exemption from such  registration  is
available. Optionee is aware of the provisions of Rule 144 promulgated under the
Securities  Act which  permit  limited  resale of shares  purchased in a private
placement subject to the satisfaction of certain  conditions,  including,  among
other things,  the existence of a public market for the shares, the availability
of certain current public  information  about the Company,  the resale occurring
not less than one (1) year (two  years for  persons  are  "affiliates")  after a
party  has  purchased  and paid for the  security  to be  sold,  the sale  being
effected  through a "broker's  transaction" or in  transactions  directly with a
"market  maker" (as  provided by Rule 144(f) and the number of shares being sold
during any three-month period not exceeding specified  limitations.  Optionee is
also  aware  that  Rules 701 and 702 under the  Securities  Act may also  enable
Optionee to obtain some liquidity under certain  specified  circumstances  after
Optionee exercises the Option.

         11. Legends. The Optionee understands that the Option and Option Shares
and any securities issued in respect thereof or exchange therefor,  may bear one
or all of the following legends:

                  (a)  "THESE  SECURITIES  HAVE NOT BEEN  REGISTERED  UNDER  THE
SECURITIES  ACT OF 1933.  THEY MAY NOT BE SOLD,  OFFERED  FOR SALE,  PLEDGED  OR
HYPOTHECATED  IN THE ABSENCE OF A REGISTRATION  STATEMENT IN EFFECT WITH RESPECT
TO THE SECURITIES  UNDER SUCH ACT OR AN OPINION OF COUNSEL  SATISFACTORY  TO THE
COMPANY THAT SUCH REGISTRATION IS NOT REQUIRED."

                  (b) Any legend  required  by the Blue Sky laws of any state to
the extent such laws are applicable to the shares represented by the certificate
so legended.


                                       4

<PAGE>

         12. Brokers of Finders.  Optionee has not incurred, and will not incur,
directly or  indirectly,  as a result of any action taken by the  Purchaser  any
liability for brokerage or finders' fees or agents'  commissions  or any similar
charges in connection with this Agreement.

                                                     COMPANY:

                                                     VIDEONICS, INC.
                                                     a California corporation

                                                     By: /s/ Michael L. D'Addio
                                                         -----------------------
                                                         Michael L. D'Addio
                                                         Chief Executive Officer

                                                     Address: 1370 Dell Avenue
                                                              Campbell, CA 95008

                                                     EMPLOYEE:

                                                     /s/ B. Yeshwant Kamath
                                                     ---------------------------
                                                             (signature)

                                                     Name: B. Yeshwant Kamath
                                                          ----------------------
                                                                 (print)

                                                     Address:
                                                             -------------------

                                                             -------------------

                                                             -------------------


                                       5