ELECTRONICS FOR IMAGING, INC.
                                2855 Campus Drive
                           San Mateo, California 94403

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


                    NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
                            To be held on May 1, 1997

TO THE STOCKHOLDERS:

         NOTICE IS HEREBY  GIVEN that the  Annual  Meeting  of  Stockholders  of
Electronics for Imaging,  Inc., a Delaware corporation (the "Company"),  will be
held on May 1, 1997 at 9:00 AM, Pacific Daylight Time at the Company's corporate
headquarters,  2855 Campus Drive, San Mateo,  California 94403 for the following
purposes:

         1.       To elect six (6)  directors  to serve for the ensuing  year or
                  until their successors are duly elected and qualified.

         2.       To approve an  amendment to the  Company's  1990 Stock Plan to
                  increase the number of shares of Common Stock  authorized  for
                  issuance thereunder by 1,000,000 shares.

         3.       To  ratify  the   appointment  of  Price   Waterhouse  LLP  as
                  independent  accountants  of the  Company  for the fiscal year
                  ending December 31, 1997.

         4.       To transact  such other  business as may properly  come before
                  the meeting or any adjournment thereof.

         The foregoing  items of business are more fully  described in the Proxy
Statement accompanying this Notice.

         Only  stockholders of record at the close of business on March 24, 1997
are  entitled  to  notice  of  and to  vote  at the  Annual  Meeting  and at any
adjournment or postponement thereof.

         All stockholders are cordially  invited to attend the Annual Meeting in
person.  However, to assure your  representation at the Annual Meeting,  you are
urged to mark,  sign,  date and return the enclosed proxy for that purpose.  Any
stockholder  attending  the Annual  Meeting may vote in person even if he or she
has returned a proxy.

                                                       Sincerely,



                                                       Eric Saltzman
                                                       Secretary
San Mateo, California
A
pril 3, 1997

                             YOUR VOTE IS IMPORTANT

             IN ORDER TO ASSURE YOUR REPRESENTATION AT THE MEETING,
         YOU ARE REQUESTED TO COMPLETE, SIGN AND DATE THE ENCLOSED PROXY
        AS PROMPTLY AS POSSIBLE AND RETURN IT IN THE ENCLOSED ENVELOPE.


<PAGE>

















                                       2


<PAGE>


                          ELECTRONICS FOR IMAGING, INC.

                                 PROXY STATEMENT

                 INFORMATION CONCERNING SOLICITATION AND VOTING

General

         This Proxy Statement is furnished in connection  with the  solicitation
of proxies  by the Board of  Directors  of  Electronics  for  Imaging,  Inc.,  a
Delaware  corporation  (the  "Company"),  for  use  at  the  Annual  Meeting  of
Stockholders to be held Thursday,  May 1, 1997 at 9:00 AM, Pacific Daylight Time
("the Annual  Meeting"),  or at any  adjournment or  postponement  thereof.  The
Annual Meeting will be held at the Company's corporate headquarters, 2855 Campus
Drive,  San Mateo,  California  94403.  The Company's  telephone  number at that
location is (415) 286-8600.

         At the Annual Meeting,  the  stockholders of the Company will be asked:
(1) to  elect  six  directors  to serve  for the  ensuing  year or  until  their
successors  are duly elected and  qualified;  (2) to approve an amendment to the
1990  Stock  Plan;  (3) to ratify the  appointment  of Price  Waterhouse  LLP as
independent  accountants  for the year  ending  December  31,  1997;  and (4) to
transact  such other  business  as may  properly  come before the  meeting.  All
proxies which are properly  completed,  signed and returned to the Company prior
to the Annual Meeting will be voted.

         These  proxy   solicitation   materials   and  the  Annual   Report  to
Stockholders  for  the  year  ended  December  31,  1996,   including  financial
statements,  were  first  mailed on or about  April 3, 1997 to all  stockholders
entitled to vote at the Annual Meeting.

Record Date

         Stockholders  of record at the close of business on March 24, 1997 (the
"Record Date") are entitled to notice of and to vote at the Annual  Meeting.  As
of March 24, 1997,  51,772,802  shares of the Company's Common Stock were issued
and outstanding,  after giving effect to the 2-for-1 stock split effected in the
form of a stock  dividend  that was paid  February 20, 1997 to  stockholders  of
record on February 10, 1997 (the "Stock Split"). The holders of Common Stock are
entitled  to one  vote  per  share  on  all  matters  to be  voted  upon  by the
stockholders  and are not  entitled  to  cumulate  votes  for  the  election  of
directors.

Voting and Solicitation

         All votes will be tabulated by the inspector of election  appointed for
the meeting,  who will  separately  tabulate  affirmative  and  negative  votes,
abstentions  and  broker  non-votes.  Abstentions  will be counted  towards  the
tabulation  of votes cast on proposals  presented to the  stockholders  and will
have the same effect as negative votes.  Broker  non-votes are counted towards a
quorum, but are not counted for any purpose in determining  whether a matter has
been approved.

         In the event that  sufficient  votes in favor of the  proposals are not
received by the date of the Annual  Meeting,  the  persons  named as proxies may
propose  one or more  adjournments  of the  Annual  Meeting  to  permit  further
solicitation of proxies.  Any such adjournment will require the affirmative vote
of the holders of a majority of the  outstanding  shares present in person or by
proxy at the Annual Meeting.

                                       3


<PAGE>

         The cost of  preparing,  assembling,  printing  and  mailing  the Proxy
Statement,  the Notice of Annual Meeting and the enclosed  proxy, as well as the
cost of soliciting  proxies  relating to the Annual Meeting will be borne by the
Company. The Company will request banks, brokers, dealers and voting trustees or
other nominees to solicit their  customers who are  beneficial  owners of shares
listed  of  record  in  names  of  nominees,  and  will  reimburse  them for the
reasonable   out-of-pocket   expenses  of  such   solicitations.   The  original
solicitation of proxies by mail may be  supplemented by telephone,  telegram and
personal  solicitation  by  directors,  officers  and regular  employees  of the
Company.

Revocability of Proxies

         Any proxy  given  pursuant to this  solicitation  may be revoked by the
person  giving it at any time  before  its use by  delivering  to the  Company a
written notice of revocation or a duly executed proxy bearing a later date or by
attending  the Annual  Meeting  and voting in person.  Attendance  at the Annual
Meeting will not, by itself, revoke a proxy.

Stockholder Proposals To Be Presented at Next Annual Meeting

         Proposals from  stockholders  that are intended to be presented by such
stockholders  at the  Company's  1998  Annual  Meeting  must be  received by the
Company no later than  December 30, 1997,  in order that they may be included in
the proxy statement and proxy relating to that Annual Meeting.



                                       4


<PAGE>


                                  PROPOSAL ONE
                              ELECTION OF DIRECTORS

Nominees

         A board of six (6)  directors  is to be elected at the Annual  Meeting.
Unless otherwise instructed, the proxy holders will vote the proxies received by
them for management's six nominees named below. In the event that any management
nominee is unable or  declines  to serve as a director at the time of the Annual
Meeting,  the proxies will be voted for any nominee who shall be  designated  by
the present Board of Directors to fill the vacancy. In the event that additional
persons are  nominated for election as  directors,  the proxy holders  intend to
vote all proxies  received by them in such a manner as will assure the  election
of as many of the nominees  listed below as  possible,  and, in such event,  the
specific  nominees to be voted for will be determined by the proxy holders.  The
Company is not aware of any nominee who will be unable or will  decline to serve
as a  director.  The term of office for each person  elected as a director  will
continue  until the next Annual Meeting of  Stockholders  or until his successor
has been elected and qualified.

<TABLE>

         The names of the nominees,  each of whom is currently a director of the
Company, and certain information about them are set forth below:

<CAPTION>
Name of Nominee and Principle Occupation                                       Age        Director Since
- ----------------------------------------                                       ---        --------------

<S>                                                                            <C>             <C> 
Efraim Arazi                                                                   59              1988
Chairman of the Board of the Company and President and Chief
     Executive  Officer of Imedia  Corporation (a video  compression  
     technology company).

Dan Avida                                                                      33              1994
President and Chief Executive Officer of the Company.

Gill Cogan                                                                     44              1992
General Partner of Weiss, Peck & Greer (investment company) and
     General Partner of Weiss, Peck & Greer Venture Partners II,
     L.P. (a venture capital firm).

Dan Maydan                                                                     61              1996
President of Applied Materials Inc. (a semiconductor
     manufacturing equipment company).

Jean-Louis Gassee                                                              53              1990
Chief Executive Officer of Be Inc. (a personal computer
     technology company).

Thomas I. Unterberg                                                            66              1990
Managing Director of Unterberg Harris (an investment banking
     firm).
</TABLE>

                                       5


<PAGE>

         Mr.  Arazi is the  founder of the Company and has served as Chairman of
the Board since the Company's inception in November 1988. Mr. Arazi is currently
President and Chief Executive Officer of Imedia Corporation. Mr. Arazi served as
Chief  Executive  Officer  of the  Company  from  inception  to July 1995 and as
President  from  inception  until July 1991 and from July 1992 to October  1994.
From November 1971 to June 1988, Mr. Arazi served as chief executive  officer of
Scitex  Corporation Ltd., which was founded by Mr. Arazi, and from November 1971
to  September  1985 and from  April  1986 to June  1988,  Mr.  Arazi  served  as
President  of  Scitex.  Mr.  Arazi was  affiliated  with  Scitex's  predecessor,
Scientific  Technologies Ltd. Prior to 1968, Mr. Arazi was a principal  engineer
at Itek Corporation,  an aerospace reconnaissance  corporation,  specializing in
the photo and elector-optical imagery fields.

         Mr. Avida has served as President of the Company since October 1994 and
as Chief Executive  Officer since July 1995. Mr. Avida served as Chief Operating
Officer  from October  1994 to July 1995.  Mr.  Avida served as Vice  President,
Research and Development  from July 1993 until October 1994. From August 1991 to
July 1993 Mr. Avida served as Vice President,  Hardware Systems and from January
1991 to August 1991,  he served as the Company's  Director of Hardware  Systems.
From December 1989 to January 1991, he was project manager and from July 1989 to
December 1989,  Mr. Avida was employed by the Company as an engineer.  From 1984
to July 1989, he served in the Israeli  Defense Forces as a project manager and,
later, as a section leader  responsible  for the development of  high-technology
projects.  Mr. Avida is a graduate of Technion,  Israel Institute of Technology,
from which he received his degree in Computer Engineering.

         Mr.  Cogan has been a  principal  of Weiss,  Peck & Greer,  L.L.C.,  an
investment company, and is also a general partner of Weiss, Peck & Greer Venture
Partners,  L.P. From 1986 to 1990, Mr. Cogan was a partner of Adler & Company, a
venture  capital group  handling  technology-related  investments.  From 1983 to
1985,  he was chairman and chief  executive  officer of Formtek,  an imaging and
data  management  computer  company,  whose products were based upon  technology
developed at  Carnegie-Mellon  University.  Mr. Cogan is currently a director of
Harmonic  Lightwaves Inc.,  Integrated  Packaging  Assembly  Corporation,  Micro
Linear  Corporation,  Number Nine Visual  Technology,  P-Com,  Inc.  and several
private  companies.  Mr.  Cogan holds a B.S.  in Physics and an M.B.A.  from the
University of California at Los Angeles.

         Mr. Gassee is currently  chief executive  officer of Be Inc.,  which he
joined in 1990. Mr. Gassee served as the president of Apple Products, a division
of Apple Computer,  Inc.  ("Apple"),  a manufacturer  of personal  computers and
related  software,  from August 1988 to February 1990.  From June 1987 to August
1988, Mr. Gassee served as senior vice president of research and  development of
Apple,  and from June 1985 to June 1987, he served as vice  president of product
development. He was also the founding general manager for Apple Computer France,
SARL.  Before joining Apple, Mr. Gassee was president and general manager of the
French  subsidiary of Exxon Business Systems.  In addition,  Mr. Gassee has held
several management  positions with Data General  Corporation,  including general
manager for France,  area manager for Latin countries and marketing  manager for
Europe. He also spent six years with Hewlett-Packard Company, where he served in
several  positions,  including sales manager of Europe. Mr. Gassee is a director
of Laser Master Technologies, Cray Computer Corporation, and 3 Com Corporation.

         Dr. Maydan has been  President of Applied  Materials Inc. since January
1994 and a member of that  company's  Board of Directors  since June 1992.  From
March 1990 to January 1994,  Dr. Maydan served as Applied  Material's  Executive
Vice President,  responsible  for all of the company's  product lines as well as
new product  development.  Dr.  Maydan is also  Co-Chairman  of Applied  Komatsu
Technology,  a joint venture  formed in September  1993 with  Komatsu,  Ltd., to
manufacture  and market  systems  for the flat panel  display  industry.  Before
joining Applied  Materials in September 1980, Dr. Maydan spent thirteen years in
various positions with Bell Laboratories.  Dr. Maydan received his B.S. and M.S.
degrees in electrical engineering from Technion,  Israel Institute of Technology
and his Ph.D. in physics from Edinburgh University.

                                       6


<PAGE>

         Mr.  Unterberg is the co-founder and has served as a managing  director
of Unterberg  Harris,  an  investment  banking  firm,  since June 1989. He was a
managing  director of Shearson  Lehman  Hutton Inc. from January 1987 to January
1989. Prior to that, he was chairman of the board,  chief executive  officer and
senior managing director of L.F. Rothschild,  Unterberg,  Towbin Holdings,  Inc.
and was associated with such firm or its  predecessors  from 1956. Mr. Unterberg
is also a director of AES China  Generating Co. Ltd., AES  Corporation,  Fractal
Design Corporation, and Systems & Computer Technology Corporation.

         Directors  are elected by a plurality of the votes present in person or
represented by proxy and entitled to vote.

 
           The Company's Board of Directors recommends a vote "FOR"
                         all six nominees listed above.


                                       7


<PAGE>

                                  PROPOSAL TWO
                        AMENDMENT OF THE 1990 STOCK PLAN

Background

         The  Company  has  adopted  two stock  plans,  the 1989 Plan (the "1989
Plan"),  and the 1990 Stock Plan (the "1990  Plan" and,  together  with the 1989
Plan,  the "Stock  Plans").  The Stock  Plans are  administered  by the Board of
Directors  or a committee  appointed by the Board.  The Stock Plans  provide for
grants to employees,  consultants  and directors of the Company or any parent or
subsidiary (as defined in the Plans) of the Company.

         The 1989 Plan was  established  by the Board of Directors in March 1989
and  1,425,000  shares of Common  Stock  were  reserved  for  issuance  upon the
exercise of options and stock  purchase  rights.  The 1989 Plan was designed for
use by the Company while it was a private company.  No options or stock purchase
rights have been issued under the 1989 Plan since November 30, 1992.

         The 1990 Plan was  established  by the Board of  Directors in June 1990
and 825,000  shares of Common Stock were reserved for issuance upon the exercise
of options and stock purchase rights under the 1990 Plan.

         On  May 2,  1992  and  July  30,  1992,  the  Board  of  Directors  and
stockholders  of the Company,  respectively,  approved  amendments  to the Stock
Plans  whereby the 825,000  shares of Common Stock then  available  for issuance
under 1990 Plan were  reallocated  and made available  under the 1989 Plan. As a
result,  2,250,000  shares of Common Stock were available for issuance under the
1989 Plan.  The 1990 Plan was further  amended to reserve an additional  450,000
shares of Common  Stock for  issuance  upon the  exercise  of options  and stock
purchase rights under the 1990 Plan.

         On  July  29,  1993  and  May 6,  1994,  the  Board  of  Directors  and
stockholders  of the Company,  respectively,  approved  amendments  to the Stock
Plans whereby  213,534  shares of Common Stock  available for issuance under the
1989 Plan were reallocated and made available for issuance under the 1990 Plan.

         On  March  25,  1994  and May 6,  1994,  the  Board  of  Directors  and
stockholders of the Company, respectively, also approved amendments to the Stock
Plans  whereby  an  additional  128,919  shares of Common  Stock  available  for
issuance  under the 1989 Plan were  reallocated  and made available for issuance
under the 1990 Plan. As a result of these amendments, 1,907,547 shares of Common
Stock were made available under the 1989 Plan and 792,453 shares of Common Stock
were  made  available  under  the 1990  Plan.  At the same  time,  the  Board of
Directors and stockholders of the Company  approved  amendments to the 1990 Plan
(i) to increase  the number of shares  reserved for  issuance  thereunder  by an
additional  750,000 shares, to a total of 1,542,453 shares, and (ii) to limit to
500,000 the number of shares of Common Stock that may be subject to awards under
the 1990 Plan to any  employee  in any fiscal  year,  in order to  preserve  the
ability  of  the  Company  to  deduct  for  federal   income  tax  purposes  the
compensation  expense  relating  to such awards in  accordance  with new Section
162(m) of the Internal Revenue Code of 1986, as amended (the "Code").

         On  April  28,  1994  and May 4,  1995,  the  Board  of  Directors  and
stockholders  of the Company,  respectively,  approved an amendment to the Stock
Plans to provide  that the  exercise  price of options to purchase  Common Stock
shall not be less than 100% of the fair market  value of the Common Stock on the
date of the grant.

                                       8


<PAGE>

         On  March  28,  1995  and May 4,  1995,  the  Board  of  Directors  and
stockholders of the Company, respectively, also approved amendments to the Stock
Plans  whereby  83,834 shares of Common Stock  available for issuance  under the
1989 Plan were  reallocated and made available for issuance under the 1990 Plan.
Additionally,  the Board of Directors and stockholders  approved an amendment to
the 1990 Plan to increase the number of shares reserved for issuance  thereunder
by an additional  950,000  shares.  As a result of these  amendments,  1,823,713
shares of Common  Stock were made  available  under the 1989 Plan and  2,576,287
shares of Common Stock were made available under the 1990 Plan for issuance upon
the exercise of options and stock purchase rights under the Stock Plans.

         On October 25,  1995,  the Board of  Directors  approved a  two-for-one
stock split in the form of a stock  dividend,  payable on  November  30, 1995 to
stockholders  of record  on  November  20,  1995.  As a result  of this  action,
3,647,426  shares of Common  Stock were made  available  under the 1989 Plan and
5,152,574  shares of Common  Stock were made  available  under the 1990 Plan for
issuance upon the exercise of options and stock purchase  rights under the Stock
Plans.

         On  March  21,  1996  and May 2,  1996,  the  Board  of  Directors  and
stockholders  of the  Company,  respectively,  approved an amendment to the 1990
Plan to increase the number of shares  reserved for  issuance  thereunder  by an
additional  950,000 shares.  As a result of this amendment,  3,647,426 shares of
Common Stock were made  available  under the 1989 Plan and  6,102,574  shares of
Common  Stock  were made  available  under the 1990 Plan for  issuance  upon the
exercise of options and stock purchase rights under the Stock Plans.

         On January 21,  1997,  the Board of  Directors  approved a  two-for-one
stock split in the form of a stock  dividend,  payable on  February  20, 1997 to
stockholders  of record  on  February  10,  1997.  As a result  of this  action,
7,294,852  shares of Common  Stock were made  available  under the 1989 Plan and
12,205,148  shares of Common Stock were made  available  under the 1990 Plan for
issuance upon the exercise of options and stock purchase  rights under the Stock
Plans.

         As of February 28, 1997,  35,132  shares of Common Stock and  4,077,024
shares of Common Stock were available for grant under the 1989 Plan and the 1990
Plan respectively after giving effect to the Stock Split.

Proposed Amendment

         On March 28, 1997, the Board of Directors  approved an amendment to the
1990 Plan to increase the number of shares  reserved for issuance  thereunder by
an additional  1,000,000  shares.  As a result of this  amendment,  the Board of
Directors  has reserved an  aggregate of 7,294,852  shares of Common Stock under
the 1989 Plan and  13,205,148  shares of Common Stock under the 1990 Plan.  This
amendment is subject to stockholder approval.

         As of February 28, 1997,  13,241,088 and 10,586,550 options to purchase
shares  of  Common  Stock had been  granted  under the 1989 Plan and 1990  Plan,
respectively,  and a total of 9,476,444  options had been  exercised  under both
Stock Plans. As of February 28, 1997,  5,911,400  options were outstanding under
the Plans at an average per share exercise price of $13.7059.

         The Stock Plans are long-term incentive plans for all employees.  These
plans are intended to align  stockholder  and  employee  interests by creating a
direct link between long-term rewards and the value of the Company's shares. The
Board of Directors believes that long-term stock ownership by executive officers
and all employees is an important  factor in achieving  above-average  growth in
share  value and in  retaining  valued  employees.  Since the value of an option
bears a direct  relationship  to the  Company's  stock price,  the Board further
believes that options  motivate both executive  officers and employees to manage
the Company in a manner which will benefit all stockholders.

                                       9


<PAGE>

         The Board of Directors is seeking approval of the amendment to the 1990
Plan to increase  the number of shares of Common Stock  authorized  for issuance
thereunder by 1,000,000  shares.  The Board of Directors of the Company believes
this amendment is necessary to properly  incentivize  the Company's  current and
future employees.  A vote of a majority of the Company's stockholders present in
person or by proxy is required to approve the  amendment  to the 1990 Plan.  The
holders of Common  Stock are  entitled to one vote per share.  Abstentions  from
voting  have  the same  effect  as  negative  votes  and  broker  non-votes  are
disregarded in the calculation of the number of votes.

 
         The Company's Board of Directors  unanimously  recommends a vote "FOR"
the amendment to the 1990 Plan.

         The  essential  features  of the 1990  Plan are  outlined  below,  with
particular  focus on  options  granted  under the 1990 Plan,  as stock  purchase
rights are no longer  granted  under the 1990 Plan.  Neither  options  nor stock
purchase rights are currently granted under the 1989 Plan.

1990 Plan

Administration

         The 1990 Plan provides for  administration by the Board of Directors of
the Company or by a committee  of the Board.  The 1990 Plan is  currently  being
administered  by  the  Compensation  Committee.   Members  of  the  Compensation
Committee  receive no additional  compensation  for their services in connection
with the administration of the 1990 Plan.

Eligibility

         The 1990 Plan provides that non-statutory options may be granted to all
employees and consultants of the Company. Incentive stock options may be granted
to employees  only.  The Board of Directors or a committee of the Board  selects
the optionees and  determines the number of shares to be subject to each option.
The 1990 Plan currently  provides that the number of shares of Common Stock that
may be subject to awards  under the 1990 Plan to any employee in any fiscal year
shall be limited to 2,000,000  shares  (adjusted to reflect all stock splits) in
order to preserve  the  ability of the Company to deduct for federal  income tax
purposes the  compensation  expense  relating to such awards in accordance  with
Section  162(m)  of the Code.  In  addition,  there is a limit on the  aggregate
market  value of shares of  $100,000  subject  to all  incentive  stock  options
granted to a single person which are  exercisable  for the first time in any one
calendar year.

Terms of Options

         Each  option is  evidenced  by a stock  option  agreement  between  the
Company  and the  person to whom such  option is  granted  and is subject to the
following additional terms and conditions:

              (a)  Exercise  of the  Options:  The  Board  of  Directors  or its
         committee  determines  when options  granted under the 1990 Plan may be
         exercised.  An option is exercised by giving written notice of exercise
         to the Company, specifying the number of full shares of Common Stock to
         be  purchased  and  tendering  payment to the  Company of the  purchase
         price. Payment for shares issued upon exercise of an option may consist
         of cash,  check,  promissory note,  exchange of shares of the Company's
         Common Stock or such other  consideration as determined by the Board of
         Directors or its  committee  and as permitted  under Section 152 of the
         Delaware  General   Corporation  Law.  Payment  may  also  be  made  by
         delivering  a  properly   executed   exercise   notice   together  with
         irrevocable instructions to a broker to promptly deliver to the Company
         the amount of sale or loan proceeds to pay the exercise price.


                                       10


<PAGE>

              (b)  Exercise  Price:  The  exercise  price under the 1990 Plan is
         determined by the Board of Directors or its committee  and,  subject to
         stockholder  approval,  may not be less  than  100% of the fair  market
         value of the Company's  Common Stock on the date the option is granted.
         However,  in the case of options  granted to any person who owns 10% or
         more of the combined  voting power of the Company's  Common Stock,  the
         per share  exercise  price must be no less than 110% of the fair market
         value of the Company's Common Stock.

              (c) Termination of Employment:  The 1990 Plan provides that if the
         optionee  ceases to serve as an employee or consultant (as the case may
         be) for any  reason  other  than death or  disability,  options  may be
         exercised not later than ninety days after such  termination (or within
         such shorter period as determined by the Board at the time of grant and
         specified in the option  agreement)  and may be  exercised  only to the
         extent the options were exercisable on the date of termination.  If the
         optionee  could not exercise  the option  within such ninety day period
         without  incurring short swing trading  liability due to the applicable
         rules adopted by the Securities and Exchange  Commission  under Section
         16 of the  Securities  and Exchange  Act of 1934,  then the time within
         which the option may be exercised  shall (if the  optionee  requests in
         writing) be extended up to a maximum of seven months after such date of
         termination. In no event, however, may an option be exercised more than
         ten years after the date of grant.

              (d)  Death or  Disability:  If an  optionee  should  die or become
         disabled  while in the  service of the  Company,  such  options  may be
         exercised  in full at any time within  twelve  months after the date of
         death or date of termination due to disability,  but only to the extent
         that  the  options  were  exercisable  on the  date of death or date of
         termination due to disability.  In no event,  however, may an option be
         exercised more than ten years after the date of grant.

              (e)  Termination of Options:  Options  granted under the 1990 Plan
         expire 10 years from the date of grant,  unless  otherwise  provided in
         the option  agreement.  However,  incentive stock options granted to an
         optionee who, immediately before the grant of such options,  owned more
         than 10% of the total combined  voting power of all classes of stock of
         the Company or a parent or subsidiary corporation,  may not have a term
         of more than five years. No option may be exercised by any person after
         such expiration.

              (f) Nontransferability of Options: An option is nontransferable by
         the   optionee   other  than  by  will  or  the  laws  of  descent  and
         distribution, and is exercisable only by the optionee during his or her
         lifetime or, in the event of death,  by a person who acquires the right
         to exercise the option by bequest or  inheritance or by reason of death
         of the optionee.

              (g)  Acceleration  of  Options:  In  the  event  of  a  merger  or
         consolidation  in which the Company is not the  surviving  entity,  the
         Board is obligated to either accomplish an assumption or a substitution
         of options or give 15 days notice of the acceleration of the optionee's
         right to exercise his outstanding options in full at any time within 15
         days of such notice.

              (h) Other Provision:  The option agreement may continue such other
         terms, provisions and conditions not inconsistent with the 1990 Plan as
         may be determined by the Board of Directors or its committee.

Adjustment Upon Changes in Capitalization

         In the event any change  (such as a stock split or dividend) is made in
the  Company's  capitalization  which  results in an increase or decrease in the
number of outstanding shares of Common Stock without receipt of consideration by
the Company,  an appropriate  adjustment shall be made in the exercise price and
in the number of shares  subject to each  option.  In the event of the  proposed
dissolution or  liquidation of the Company,  the board must notify the optionees
at least 15 days prior to such proposed action and all  outstanding  options not
previously exercised shall automatically  terminate unless otherwise provided by
the Board.

                                       11


<PAGE>

Amendment and Termination

         The Board of Directors may amend the 1990 Plan at any time or from time
to time or may  terminate  it without  approval of the  stockholders,  provided,
however, that stockholder approval is required for any amendment which increases
the number of shares that may be issued under the 1990 Plan,  materially changes
the standards of  eligibility,  or materially  increases the benefits  which may
accrue to participants under the 1990 Plan.  However,  no action by the Board of
Directors  or  stockholders  may alter or impair any option  previously  granted
under the 1990 Plan without the consent of the optionee.  In any event, the 1990
Plan will terminate in 2000.

Tax Information

         Options  granted  under the 1990 Plan may be  either  "incentive  stock
options," as defined in Section 422 of the Code or "non-statutory options."

         Incentive Stock Options.  An optionee who is granted an incentive stock
option  will not  recognize  taxable  income  either  at the time the  option is
granted or upon its exercise,  although the exercise may subject the optionee to
the  alternative  minimum tax. Upon the sale or exchange of the shares more than
two years  after grant of the option and one year after  exercising  the option,
any gain or loss will be treated as  long-term  capital  gain or loss.  If these
holding periods are not satisfied,  the optionee will recognize  ordinary income
at the time of sale or exchange  equal to the  difference  between the  exercise
price and the lower of (i) the fair  market  value of the  shares at the date of
the option  exercise or (ii) the sale price of the shares.  A different rule for
measuring  ordinary  income upon such a premature  disposition  may apply if the
optionee  is also an  officer,  director,  or 10%  stockholder  of the  Company.
Generally, the Company will be entitled to a deduction in the same amount as the
ordinary income recognized by the optionee.  Any gain or loss recognized on such
a  premature  disposition  of the  shares  in excess of the  amount  treated  as
ordinary  income  will be  characterized  as  long-term  capital  gain or  loss,
depending on the holding period.

         Non-Statutory Stock Options.  Options which do not qualify as incentive
stock  options are referred to as  non-statutory  options.  An optionee will not
recognize  any taxable  income at the time he or she is granted a  non-statutory
option.  However, upon its exercise,  the optionee will recognize taxable income
generally  measured  as the excess of the then fair  market  value of the shares
purchased over the purchase price.  Any taxable income  recognized in connection
with an option  exercise by an  optionee  who is also an employee of the Company
will be subject to tax withholding by the Company. Upon resale of such shares by
the optionee, any difference between the sales price and the optionee's purchase
price, to the extent not recognized as taxable income as described  above,  will
be treated as a long-term capital gain or loss, depending on the holding period.
Generally, the Company will be entitled to a tax deduction in the same amount as
the ordinary  income  recognized by the optionee with respect to shares acquired
upon exercise of a non-statutory option.

         Potential  Limitation  on Company  Deductions.  As part of the  Omnibus
Budget  Reconciliation  Act of 1993, the U.S.  Congress  amended the Code to add
Section  162(m) which denies a deduction to any publicly  held  corporation  for
compensation  paid to certain  employees  in a taxable  year to the extent  that
compensation  exceeds $1 million for a covered  employee.  It is  possible  that
compensation  attributable  to awards granted in the future under the 1990 Plan,
when  combined  with all  other  types of  compensation  received  by a  covered
employee  from the  Company,  may cause this  limitation  to be  exceeded in any
particular year.

         Certain kinds of compensation,  including qualified  "performance-based
compensation,"  are  disregarded  for purposes of the deduction  limitation.  In
accordance with Treasury  regulations issued under Section 162(m),  compensation
attributable  to stock options will qualify as  performance-based  compensation,
provided that the option is granted by a compensation committee comprised solely
of "outside  directors" and either:  (i) the option plan contains a per-employee
limitation  on the number of shares for which  options  may be granted  during a
specified period, the per-employee limitation is approved

                                       12



<PAGE>

by the  stockholders,  and the exercise  price of the option is no less than the
fair  market  value of the  stock on the date of  grant;  or (ii) the  option is
granted (or  exercisable)  only upon the achievement (as certified in writing by
the  compensation  committee) of an objective  performance  goal  established in
writing  by the  compensation  committee  while  the  outcome  is  substantially
uncertain, and the option is approved by stockholders.

         The  foregoing  is only a  summary  of the  effect  of  federal  income
taxation  upon the  optionee  and the  Company  with  respect  to the  grant and
exercise of options  under the 1990 Plan,  does not purport to be complete,  and
does not discuss the tax  consequences of the optionee's death or the income tax
laws of any  municipality,  state or foreign  country in which an  optionee  may
reside.

Participation in the 1990 Plan

         The  grant of stock  options  under  the 1990  Plan is  subject  to the
discretion of the Board of Directors or its committee and as of the date of this
proxy  statement,  there has been no  determination by the Board of Directors or
its  committee  with  respect  to  future  grants  of  options.  See  "Executive
Compensation"  for information  with respect to the number of options granted to
the  executive  officers  named  therein.  As of February 28, 1997,  all current
executive  officers as a group (including the executive officers named under the
caption  "Executive  Committee"),  all  current  directors  as a  group  and all
employees as a group (excluding executive officers) have been granted options to
purchase   3,068,000,   3,753,050  and   14,158,988   shares  of  Common  Stock,
respectively, since the inception of the 1990 Plan.

                                       13



<PAGE>



                                 PROPOSAL THREE
             RATIFICATION OF APPOINTMENT OF INDEPENDENT ACCOUNTANTS

         The Board of Directors has selected Price  Waterhouse LLP,  independent
accountants,  to audit the consolidated  financial statements of the Company for
the fiscal year ending December 31, 1997, and recommends that  stockholders vote
for  ratification  of such  appointment.  Price  Waterhouse  LLP has audited the
C
ompany's financial  statements since 1992.  Notwithstanding the selection,  the
Board,  at its  discretion,  may  direct  the  appointment  of  new  independent
accountants  at any time during the year,  if the Board feels that such a change
would be in the best interests of the Company and its stockholders. In the event
of a negative vote of such ratification,  the Board of Directors will reconsider
its selection.

         Representatives  of Price  Waterhouse LLP are expected to be present at
the meeting with the opportunity to make a statement if they desire to do so and
are expected to be available to respond to appropriate questions.

            The Company's Board of Directors unanimously recommends a
                 vote "FOR" the ratification of the appointment
              of Price Waterhouse LLP as independent accountants.


                                       14

<PAGE>


COMMITTEES OF THE BOARD OF DIRECTORS

Meetings of Board of Directors and Committees

         The  Board of  Directors  of the  Company  held a total  of  three  (3)
meetings during 1996. No director attended fewer than 75% of the meetings of the
Board of Directors  and  committees  thereof,  if any,  upon which such director
served.  The  Board of  Directors  has an  Audit  Committee  and a  Compensation
Committee.

         The Audit  Committee  consists of Director Cogan and, since January 21,
1997,  Director Maydan.  The Audit Committee held four (4) meetings during 1996.
The Audit Committee  approves the engagement of and the services to be performed
by the Company's  independent  accountants and reviews the Company's  accounting
principles and its system of internal accounting controls.

         The Compensation  Committee  consists of Directors Gassee and Unterberg
and met after  certain  board  meetings and  generally  undertook its actions by
unanimous written consent.  The Compensation  Committee reviews and approves the
Company's executive compensation policy and administers the Stock Plans.

         The Board of  Directors  does not have a  nominating  committee  or any
committee performing similar functions.

         Outside members of the Board of Directors  receive no cash compensation
for serving on the Board of Directors  other than  reimbursement  of  reasonable
expenses  incurred in attending  Board  meetings.  However,  Mr. Gassee has been
granted options to purchase  600,000 shares of the Company's  Common Stock under
the 1989 Plan, of which options to purchase  127,500  shares remain  outstanding
and  exercisable,  and Mr.  Maydan has been granted  options to purchase  30,000
shares of the  Company's  Common Stock under the 1990 Plan,  all of which remain
outstanding. See below.

Report of Compensation Committee

         The  Report  of the  Compensation  Committee  shall not be deemed to be
incorporated by reference by any general  statement  incorporating  by reference
this proxy  statement  into any  filing  under the  Securities  Act of 1933 (the
"Securities  Act") or under the  Securities  Exchange Act of 1934 (the "Exchange
Act"),  except to the extent that the  Company  specifically  incorporates  this
information  by  reference,  and shall not  otherwise be deemed filed under such
acts.

         General.  The  responsibilities  of the  Compensation  Committee are to
administer the Company's various incentive plans, including the Stock Plans, and
to set compensation policies applicable to the Company's executive officers.

         Base Salary.  Individual  salaries are  determined  based on individual
experience,  performance and breadth of responsibility  within the Company.  The
Compensation  Committee  reviews these factors for each  executive  officer each
year. In addition,  the Compensation  Committee  considers  executive  officers'
salaries  for  relative  competitiveness  within  the  Company's  sector  of the
computer industry.

         Commissions and Bonuses.  The Company  established a bonus plan for its
executive officers. See "Employee Benefit Plans - Executive Incentive Plans."

                                       15

<PAGE>

         Stock Options.  The Stock Plans are long-term  incentive  plans for all
employees.  These plans are intended to align stockholder and employee interests
by  creating  a direct  link  between  long-term  rewards  and the  value of the
Company's  shares.  The  Compensation  Committee  believes that long-term  stock
ownership by  executive  officers  and all  employees is an important  factor in
achieving above average growth in share value and in retaining valued employees.
Since the value of an option bears a direct  relationship to the Company's stock
price,  the  Compensation  Committee  believes that options  motivate  executive
officers and  employees to manage the Company in a manner which will benefit all
stockholders.

         The Stock Plans  authorize  the  Compensation  Committee to award stock
options to employees at any time.  Options are generally  granted at the time of
initial employment with the Company, and at later dates at the discretion of the
Compensation Committee. The size of initial and subsequent grants are determined
by a number of factors  including  comparable  grants to executive  officers and
employees  by other  companies  which  compete in the  Company's  industry.  The
exercise price per share of the stock options is equal to the prevailing  market
value of a share of the  Company's  Common  Stock  on the date the  options  are
granted.

         CEO Salary. The Compensation  Committee has set Mr. Avida's base salary
for 1997 at $375,000.  The  Compensation  Committee  believes that the Company's
success is  dependent in part upon the efforts of its chief  executive  officer,
and as a result, the Company entered into a four-year  employment agreement with
Mr. Avida in July, 1995 (see "Executive Compensation").



                                  Submitted by:


                                           Jean-Louis Gassee
                                           Member of the Compensation Committee

                                           Thomas I. Unterberg
                                           Member of the Compensation Committee


                                       16

<PAGE>



                               SECURITY OWNERSHIP

<TABLE>
         Except as otherwise  indicated  below,  the following  table sets forth
certain  information  regarding  beneficial  ownership  of  Common  Stock of the
Company as of March 24, 1997 by (i) each  person  known by the Company to be the
owner of more  than 5% of the  outstanding  shares of  Common  Stock,  (ii) each
director, (iii) each executive officer listed in the Summary Compensation Table,
and (iv) all executive officers and directors as a group.
<CAPTION>
 
                                                                                      Common Stock
                                                                                ------------------------
                                                                                No. of            Percent
                Name of Beneficial Owner (1)                                    Shares             Owned
- -----------------------------------------------------------------------         ------             -----
<S>                                                                            <C>                 <C>  
FMR Corporation........................................................        6,243,600           12.1%
82 Devonshire Street
Boston, Massachussetts  02109

Putnam Investments, Inc................................................        5,083,606            9.8%
One Post Office Square
Boston, Massachusetts 02109

Pilgrim Baxter & Associates............................................        3,806,000            7.4%
1255 Drummers Lane
Wayne, Pennsylvania 19087

American Century Companies, Inc........................................        2,779,400            5.4%
4500 Main Street
Kansas City, Missouri  64141

Nicholas Applegate Capital Management..................................        2,678,492            5.2%
600 West Broadway, 29th Floor
San Diego, California 92101

John Hancock Advisers, Inc.............................................        2,600,000            5.0%
John Hancock Place, P.O. Box 111
Boston, Massachusetts 02117

Dan Avida (2)..........................................................          669,800            1.3%

Jeffrey Lenches (3)....................................................          255,000             *

Thomas Unterberg ......................................................          204,000             *

Jean-Louis Gassee (3)..................................................          127,500             *

Dan Maydan (3) ........................................................            7,500             *

Fred Rosenzweig........................................................            6,000             *

Efraim Arazi...........................................................             --              __

Gill Cogan ............................................................             --              --

Eric Saltzman .........................................................             --              --

All executive officers and directors as a group

     (9 persons) (4) ..................................................        1,269,800            2.5%


<FN>
- ----------------------
*      Less than one percent.

                                       17

<PAGE>

(1)    This table is based upon information supplied by officers,  directors and
       principal   stockholders  and  Schedules  13D  and  13G  filed  with  the
       Commission. Unless otherwise indicated in the footnotes to this table and
       subject  to  community  property  laws  where  applicable,  each  of  the
       stockholders  named in this table has sole  voting and  investment  power
       with respect to the shares  indicated as beneficially  owned.  Applicable
       percentages are based on 51,772,802 shares outstanding on March 24, 1997,
       after  giving  effect to the Stock  Split,  adjusted as required by rules
       promulgated by the Securities and Exchange Commission (the "SEC").

(2)    Includes 623,424 shares of Common Stock issuable upon exercise of options
       granted  to Mr.  Avida  under the 1989  Plan and the 1990 Plan  which are
       exercisable within 60 days of March 24, 1997.

(3)    Consists  solely of Common  Stock  issuable  upon the exercise of options
       granted under the 1989 and/or 1990 Plans which are exercisable  within 60
       days of March 24, 1997.

(4)    Includes an aggregate of 1,013,424  shares of Common Stock  issuable upon
       the exercise of options granted to executive officers and directors under
       the 1989 and/or 1990 Plans which are exercisable  within 60 days of March
       24, 1997.

                                       18
</FN>
</TABLE>


<PAGE>


                               EXECUTIVE OFFICERS

         The  following  table lists  certain  information  regarding  executive
officers as of March 24, 1997.

Name                      Age    Position
- ----                      ---    --------

Dan Avida                 33     President and Chief Executive Officer

Jeffrey Lenches           49     Executive Vice President

Fred Rosenzweig           41     Vice President, Manufacturing and Support

Eric Saltzman             34     Vice  President,  Strategic Relations,  General
                                      Counsel and Corporate Secretary


         Information   regarding   Dan  Avida  is  listed  under   "Election  of
Directors."

         Mr. Lenches has served as Executive Vice President  since October 1994.
From August 1993 to October 1994, he served as Vice President - Sales. From July
1991 to August  1993 he served as Vice  President - Fiery  Sales,  and from July
1990 to July 1991,  he was  Director  of Sales.  Mr.  Lenches  served as Western
regional sales manager and national VAR and OEM sales manager at Tektronix, Inc.
from 1987 to 1990. Mr. Lenches holds a B.B.A. from Ohio University and an M.B.A.
from Pepperdine University.

         Mr. Rosenzweig has served as Vice President,  Manufacturing and Support
since January  1995.  From May 1993 to January 1995,  Mr.  Rosenzweig  served as
Director of  Manufacturing.  From July 1992 to May 1993,  he was a plant general
manager at Tandem  Computers  Corporation.  From October 1989 to July 1992,  Mr.
Rosenzweig  served as a systems and peripheral test manager at Tandem  Computers
Corporation.  Mr.  Rosenzweig  holds a B.S. in  Metallurgical  Engineering  from
Pennsylvania State University and an M.B.A. from the University of California at
Berkeley.

         Mr.  Saltzman has served as Vice President,  Strategic  Relations since
October 1995. From January 1994 to October 1995, Mr. Saltzman served as Director
of Commercial Affairs and General Counsel.  From June 1991 to December 1993, Mr.
Saltzman was a Senior  Corporate  Associate at Cooley  Godward LLP. From October
1987 to May 1991, Mr.  Saltzman was a Corporate  Associate at Stradling,  Yocca,
Carlson & Rauth.  Mr. Saltzman holds a B.A. from  Swarthmore  College and a J.D.
from Stanford Law School.

                                       19

<PAGE>


                             EXECUTIVE COMPENSATION

<TABLE>
         The following  table sets forth certain summary  information  regarding
compensation  paid by the Company for services  rendered during the fiscal years
ended  December  31,  1996,  1995 and  1994 to all  individuals  serving  as the
Company's Chief  Executive  Officer during the last complete fiscal year and its
four most highly  compensated  executive officers other than the Chief Executive
Officer.
<CAPTION>

                                                                                Summary Compensation Table
                                                                                              Long-Term
                                                                                              Compensation
                                                            Annual Compensation                 Awards             
                                                            -------------------                 ------            All Other
                                                          Salary            Bonus              Number of         Compensation
Name and Principal Position                    Year       ($) (1)          ($) (1)             Options (2)           ($)
- ---------------------------                    ----     --------------     ------------        ------------        -------
<S>                                            <C>         <C>               <C>                 <C>                   
Dan Avida                                      1996        350,000           188,149(3)          150,000             --
President and                                  1995        275,000           160,840(4)          200,000             --
Chief Executive Officer                        1994        188,139            84,901(5)          810,000             --

Jeffrey Lenches                                1996        217,000           116,871(6)           44,000             --
Executive Vice President                       1995        177,125           127,116(6)           80,000             --
                                               1994        116,731           116,151(6)          500,000             --

Fred Rosenzweig                                1996        157,000(7)         56,448(3)           44,000             --
Vice President, Manufacturing and Support      1995        122,750            25,853(4)          114,000             --

Eric Saltzman                                  1996        143,750(7)         46,110(3)           30,000             --
Vice President, Strategic Relations,           1995        113,375            10,044(4)           54,000             --
   General Counsel and Corporate Counsel
<FN>

(1)    Amounts shown include cash and non-cash  compensation earned and received
       by  executive  officers  as well as amounts  earned but  deferred  at the
       election of those officers.
(2)    All share and per share  data have been  restated  to  reflect  the Stock
       Split.  See Notes 1 and 5 of Notes to Consolidated  Financial  Statements
       appearing  in the  Annual  Report  to  Stockholders  for the  year  ended
       December 31, 1996.
(3)    Represents  bonuses  accrued in 1996 under the  Executive  Bonus Plan and
       paid in January 1997.
(4)    Represents  bonuses  accrued in 1995 under the  Executive  Bonus Plan and
       paid in January 1996.
(5)    Represents  bonuses  accrued in 1994 under the  Executive  Bonus Plan and
       paid in January 1995.
(6)    Represents sales commissions.
(7)    Includes salary accrued in 1996 and paid in 1997.
</FN>
</TABLE>

                                       20

<PAGE>

         The Company  entered into  employment  agreements  with Messrs.  Avida,
Lenches,  Rosenzweig in July 1995 and with Mr.  Saltzman in October 1995 whereby
each  executive's  employment  shall  continue  to be "at will." The  employment
agreements state an annual base salary, subject to any increases annually as the
Company's  Board shall  authorize from time to time in connection with an annual
review and provides for such  performance  bonus amounts as the Company's  Board
authorizes.  In addition,  the employment  agreements contain certain provisions
that take  effect  upon a change in  control  of the  Company.  Upon a change of
control,  all unvested options granted in 1994 will automatically be accelerated
and the  executive  shall  have the right to  exercise  all or a portion of such
stock  options so vested.  Vesting of the options will be adjusted to the extent
necessary  such that  "parachute  payments"  do not exceed the maximum that each
executive may receive under the Internal  Revenue Code before being  required to
pay an excise tax. Any unvested options shall be assumed by the successor of the
Company and vesting shall  continue  while the executive  remains an employee of
the successor of the Company.  If the  executive's  employment is involuntary or
constructively terminated other than for cause prior to the date vesting of such
options is  completed,  the  executive  shall be retained as a consultant to the
successor of the Company at a specified  rate per hour for the period  necessary
to allow the remaining  options held by the executive to vest in full, but in no
event to exceed six months.  If the executive's  employment is  involuntarily or
constructively terminated other than for cause within a period beginning 90 days
before and ending 18 months  after a change of control,  the  executive  will be
entitled to a lump sum  severance  payment in an amount equal to one-half of his
then current annual salary and bonus. Each employment  agreement terminates upon
the earlier of (i) the date that all obligations of the parties  thereunder have
been  satisfied,  (ii) October 1, 1999,  or (iii)  eighteen  (18) months after a
change of control.

C
ompliance With Section 16(a) of the Securities Exchange Act of 1934

         Section  16(a) of the  Securities  Exchange  Act of 1934,  as  amended,
requires the Company's officers, directors and persons who beneficially own more
than ten percent of a registered  class of the Company's equity  securities,  to
file  reports of  security  ownership  and  changes in such  ownership  with the
Securities and Exchange Commission (the "SEC"). Officers,  directors and greater
than ten percent beneficial owners also are required by rules promulgated by the
SEC to furnish the Company with copies of all Section 16(a) forms they file.

         Based solely upon a review of the copies of such forms furnished to the
Company, or written  representations  that no Form 5 filings were required,  the
Company  believes  that during the period from  January 1, 1996 to December  31,
1996, all Section 16(a) filing requirements applicable to officers, directors or
greater than ten percent beneficial owners were complied with.

                                       21

<PAGE>

 
                            EMPLOYEE BENEFIT PLANS

         The  following  is a brief  summary of the  employee  benefit  plans in
effect  during the three  fiscal  years  ended  December  31,  1996 under  which
executive  officers or directors of the Company received  benefits.  The closing
price for the Company's  Common Stock as reported on the NASDAQ  National Market
System on March 24, 1997 was $38.00 per share.

Executive Incentive Plans

         The  Compensation  Committee of the  Company's  Board of Directors  has
adopted a bonus plan for its executive officers.  Target bonuses under the Bonus
Plan have been established  based on a factor of the individual's  annual salary
for 1997 and are 72%, 50%, 50% and 40% for Messrs.  Avida,  Lenches,  Rosenzweig
and Saltzman,  respectively.  Under the bonus plan, the target bonus established
for  all   participants  is  based  on  the   individual's   and  the  Company's
performances.  Payment of target bonuses related to the Company's performance is
contingent upon the achievement of certain minimum  operating profit and revenue
goals.  If minimum  operating  profit and revenue goals are not achieved,  bonus
awards based on individual performance could still be made.

Stock Plans

         The Company's Stock Plans are administered by the Board of Directors or
a committee  appointed  by the Board (the  Administrator).  Pursuant to the 1989
Plan,  options or stock  purchase  rights to acquire an  aggregate  of 7,294,852
shares of Common Stock may be granted, and pursuant to the 1990 Plan, options or
stock  purchase  rights to acquire an aggregate of  13,205,148  shares of Common
Stock may be granted. See "Proposal Two - Amendment to the 1990 Stock Plan." The
Stock Plans provide for grants to employees,  directors and  consultants  of the
Company.

         Subject to the provisions of the Stock Plans, the Administrator has the
authority to determine the  individuals to whom stock options are to be granted,
the number of shares to be covered by each option,  the exercise price, the type
of option, the term of the option, the restrictions,  if any, on the exercise of
the option,  the terms for the  payment of the option  price and other terms and
conditions.  Stock purchase  rights may be granted either alone, in addition to,
or in tandem with other awards  granted under the Stock Plans and/or cash awards
made  outside of the Stock Plans.  Subject to the terms of the Stock Plans,  the
Administrator has authority to determine the terms,  conditions and restrictions
related to the offer of stock  purchase  rights,  including the number of shares
subject to stock purchase rights, the price to be paid and the time within which
an offer must be accepted. Payments by option holders upon exercise of an option
may be made (as determined by the  Administrator)  in cash or such other form of
payment as permitted under the Stock Plans,  including  without  limitation,  by
promissory  note or by shares of Common  Stock.  In  addition,  an optionee  may
engage in a same-day  exercise  of an option and sale of the  underlying  stock,
using a portion of the  proceeds  from the sale of the stock to pay the exercise
price,  and may  satisfy  tax  withholding  obligations  by having  the  Company
withhold  from the shares to be issued  upon  exercise of the option a number of
shares  having a fair market value equal to the amount  required to be withheld.
In the  event  of a  proposed  merger  of  the  Company  with  or  into  another
corporation,  outstanding  options must be assumed or equivalent options must be
substituted  by such  successor  corporation  or a parent or  subsidiary of such
successor  corporation.  In the event that such successor  corporation  does not
agree to assume  options or substitute  equivalent  options,  the Board must, in
lieu of such assumption or  substitution,  provide for the optionees to have the
right to  exercise  their  options  as to all shares  subject  to such  options,
including shares as to which options would not otherwise be exercisable.

                                       22

<PAGE>

<TABLE>

         The  following  table sets forth  information  regarding  stock  option
grants  made  during the  fiscal  year ended  December  31,  1996 to each of the
executive  officers named in the Summary  Compensation  Table. All share and per
share data have been  restated to reflect the Stock Split.  See Notes 1 and 5 of
Notes to  Consolidated  Financial  Statements  appearing in the Annual Report to
Stockholders for the year ended December 31, 1996.

              Option Grants in Fiscal Year Ended December 31, 1996

<CAPTION>
                                               Individual Grants
                         ------------------------------------------------------------
                                                                                             Potential Realizable
                                     % of Total                 Fair                      Value at Assumed Annual Rates
                           Number      Options                 Market                     of  Stock Price Appreciation for
                        Of Options   Granted to   Exercise    Value on                           Option Term (4)
                           Granted    Employees     Price      Date of   Expiration       --------------------------------
                           (1) (2)     in 1996   Per Share      Grant       Date (3)         0%           5%          10%
                        ------------ ---------- ----------- ------------- ------------    -------      -------      ------
<S>                      <C>            <C>      <C>          <C>          <C>            <C>     <C>          <C>       
Dan Avida                150,000(5)     8%       $25.625       $25.625     7/15/06        --      $2,417,314   $6,125,948

Jeffrey Lenches           44,000(5)     2%        25.625        25.625     7/15/06        --         709,079    1,796,945

Fred Rosenzweig           44,000(5)     2%        25.625        25.625     7/15/06        --         709,079    1,796,945

Eric Saltzman             30,000(5)     2%        25.625        25.625     7/15/06        --         483,463    1,225,190
<FN>

(1)    Options  granted in 1996 are  exercisable  starting  12 months  after the
       grant date,  with 25% of the option shares  becoming  exercisable  on the
       first  anniversary of the grant date, with full vesting  occurring on the
       fourth anniversary date.
(2)    Under the terms of the Stock Plans, the Administrator retains discretion,
       subject to Stock Plan limits, to modify the terms of outstanding  options
       and to reprice outstanding options.
(3)    The options have a term of 10 years,  subject to earlier  termination  in
       certain events related to termination of employment.
(4)    The 5% and 10% assumed rates of appreciation are mandated by the rules of
       the SEC and do not represent the Company's  estimate or projection of its
       future Common Stock price.
(5)    These options were granted on July 15, 1996.

</FN>
</TABLE>

                                       23

<PAGE>

         The following table sets forth information regarding exercises of stock
options  during the fiscal year ended December 31, 1996 by each of the executive
officers named in the Summary  Compensation  Table. All share and per share data
have been  restated  to reflect the Stock  Split.  See Notes 1 and 5 of Notes to
Consolidated Financial Statements appearing in the Annual Report to Stockholders
for the year ended December 31, 1996.

<TABLE>
                Aggregated Option Exercises in Fiscal Year Ended
               December 31, 1996 and Fiscal Year End Option Values

<CAPTION>

                                                                Number of                       Value of Unexercised
                                                             Unexercised Options                 In-the-Money Options
                        Shares                                  at 12/31/96                        at 12/31/96 (2)
                      Acquired on      Value           -------------------------------    -------------------------------
Name                   Exercise      Realized(1)       Exercisable      Unexercisable     Exercisable       Unexercisable
- ----                -------------    -----------       -----------      -------------     -----------       -------------
<S>                      <C>          <C>               <C>                <C>              <C>              <C>        
Dan Avida                54,000       $1,286,550        545,090            490,834          $19,163,715      $13,441,274

Jeffrey Lenches         210,000        6,723,050        233,330            232,670            8,305,068        7,007,308

Fred Rosenzweig          41,500        1,178,375         13,500            168,500              395,781        4,729,219

Eric Saltzman            36,000        1,031,531             --            115,500                   --        3,256,031
<FN>
(1)    This amount  represents the market value of the underlying  securities on
       the exercise date minus the exercise price of such options.
(2)    This amount  represents  the market  value of the  underlying  securities
       relating  to  "in-the-money"  options  at  December  31,  1996  minus the
       exercise price of such options.
</FN>
</TABLE>



           COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION

         Jean-Louis Gassee has served on the Compensation Committee of the Board
of Directors from its formation in August 1992 through December 31, 1996. Thomas
I. Unterberg has served on the Compensation  Committee of the Board of Directors
from his  appointment in February 1995 through  December 31, 1996.  Frederick R.
Adler served on the  Compensation  Committee of the Board of Directors  from its
formation in August 1992 through his resignation  from the Board of Directors on
December 16, 1994.

                                       24

<PAGE>

                      COMPARISON OF CUMULATIVE TOTAL RETURN
          AMONG ELECTRONICS FOR IMAGING, INC., H&Q TECHNOLOGY INDEX AND
                             NASDAQ COMPOSITE INDEX

         The stock price performance graph below includes  information  required
by the SEC and shall not be deemed  incorporated  by  reference  by any  general
statement  incorporating by reference this proxy statement into any filing under
the Securities  Act or under the Exchange Act,  except to the extent the Company
specifically incorporates this information by reference, and shall not otherwise
be deemed soliciting material or filed under such Acts.

         The following  graph  demonstrates  a comparison  of  cumulative  total
returns based upon an initial  investment of $100 in the Company's  Common Stock
as compared with the Hambrecht & Quist Technology Index and the NASDAQ Composite
Index. The stock price  performance  shown on the graph below is not necessarily
indicative of future price performance and only reflects the Company's  relative
stock price for the period commencing on October 2, 1992 (the date the Company's
Common Stock began trading on the NASDAQ  National  Market System) and ending on
December 31, 1996.


[The following  descriptive  data is supplied in accordance  with Rule 304(d) of
Regulation S-T]

       Investment Value         EFI        H&Q Technology       NASDAQ Comp.
       ----------------         ---        --------------       ------------

            10/02/92            $100            $100              $100.00
            12/31/92            $144            $138              $118.42
            12/31/93            $120            $131              $135.90
            12/31/94            $200            $151              $133.72
            12/31/95            $636            $226              $184.06
            12/31/96          $1,196            $308              $225.85



                                       25




<PAGE>

                                  OTHER MATTERS

         The Company  knows of no other  matters to be submitted at the meeting.
If any other matters  properly  come before the meeting,  it is the intention of
the  persons  named  in the  enclosed  form of proxy  to vote  the  shares  they
represent as the Board of Directors may recommend.


                       By Order of the Board of Directors


Dated:  April 3, 1997



                                       26


<PAGE>


                                                                      APPENDIX A

         This Proxy is solicited on behalf of the Board of Directors of
                         ELECTRONICS FOR IMAGING, INC.
                         ANNUAL MEETING OF STOCKHOLDERS
                                  MAY 1, 1997


     The undersigned  stockholder of ELECTRONICS  FOR IMAGING,  INC., a Delaware
corporation,  hereby  acknowledges  receipt of the  Notice of Annual  Meeting of
Stockholders  and Proxy Statment,  each dated April 3, 1997, and hereby appoints
Efraim  Arazi  and  Dan  Avida,  or  either  of  them,  his or her  proxies  and
attorneys-in-fact, with full power to each of substitution, on behalf and in the
name of the undersigned, to represent the undersigned at the 1997 Annual Meeting
of Stockholders of ELECTRONICS FOR IMAGING, INC. to be held on Thursday,  May 1,
1997 at 9:00 a.m., Pacific Daylight Time, at Electronics for Imaging, Inc., 2855
Campus  Drive,  San  Mateo,   California   94403,  and  at  any  adjournment  or
adjournments  thereof,  and  to  vote  all  shares  of  Common  Stock  that  the
undersigned would be entitled to vote if then and there personally  present,  on
the matters set forth on the reverse.


<PAGE>

Voting Items.

1.   Election of Directors:

     Nominees:  Efraim Arazi;  Dan Avida;  Gill Cogan;  Jean-Louis  Gassee;  Dan
     Maydan; Thomas I. Unterberg.

2.   Proposal to approve an amendment to the 1990 Stock Plan.

3.   Proposal to ratify the appointment of Price Waterhouse LLP as independent
     auditors of the Company for the fiscal year ending December 31, 1997.

4.   In their discretion, upon such other matter or matters that may properly
     come before the meeting or any adjournments thereof.