SCHEDULE 14A INFORMATION

                  Proxy Statement Pursuant to Section 14(a) of
                      the Securities Exchange Act of 1934
                                (Amendment no. 1)


Filed by the Registrant    [X]                       
Filed by a party other than the Registrant   [ ]

Check the appropriate box:                 
[ ]  Preliminary Proxy Statement           [ ]  Confidential, for Use of the   
[X]  Definitive Proxy Statement                 Commission Only (as permitted by
[ ]  Definitive Additional Materials            Rule 14a-6(e)(2))               
[ ]  Soliciting Material Pursuant to       
     Rule 14a-11(c) or Rule 14a-12       

                          ELECTRONICS FOR IMAGING, INC.
                ------------------------------------------------
                (Name of Registrant as Specified in Its Charter)


    ------------------------------------------------------------------------
    (Name of Person(s) Filing Proxy Statement, if other than the Registrant)


Payment of filing fee (Check the appropriate box):

[X]  No fee required.
[ ]  Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.


(1)  Title of each class of securities to which transactions applies:

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(2)  Aggregate number of securities to which transactions applies:

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(3)   Per unit price or other underlying value of transaction  computed pursuant
      to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is
      calculated and state how it was determined):

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

(4)   Proposed maximum aggregate value of transaction:

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(5)   Total fee paid:

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[ ]   Fee paid previously with preliminary materials.
- --------------------------------------------------------------------------------

[ ]   Check box if any part of the fee is offset as  provided  by  Exchange  Act
      Rule  0-11(a)(2)  and identify the filing for which the offsetting fee was
      paid  previously.  Identify the previous filing by registration  statement
      number, or the Form or Schedule and the date of its filing.

(1)   Amount previously paid:

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(2)   Form, Schedule or Registration Statement No.:

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(3)  Filing party:

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(4)  Date filed:

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<PAGE>

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

                    NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
                            To be held on May 7, 1998


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 7, 1998 at 9:00 AM, Pacific  Daylight  Time, at 331 Lakeside  Drive,
Foster City, California 94404 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,
         1998.

     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 23, 1998 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,

                                        /s/ Eric Saltzman
                                        -----------------------------
                                        Eric Saltzman
                                        Secretary


San Mateo, California
A
pril 2, 1998


- --------------------------------------------------------------------------------
                            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>


                          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 7, 1998 at 9:00 AM,  Pacific  Daylight  Time  ("the  Annual
Meeting"),  or at any  adjournment or postponement  thereof.  The Annual Meeting
will be held at 331 Lakeside Drive,  Foster City,  California 94404. The Company
intends to mail this proxy  statement  and  accompanying  proxy card on or about
April 2, 1998.

     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, 1998;  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.


Voting Rights and Outstanding Shares

     Stockholders  of  record at the close of  business  on March 23,  1998 (the
"Record Date") are entitled to notice of and to vote at the Annual  Meeting.  As
of March 23, 1998, the Company had  outstanding  and entitled to vote 52,600,667
shares of Common Stock.  Each holder of record of Common Stock on such date will
be  entitled  to one vote per each share on all  matters to be voted upon by the
stockholders  and are not  entitled  to  cumulate  votes  for  the  election  of
directors.

     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.


Solicitation

     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 or, at the Company's request by Corporate Investor Communications,  Inc.
No additional compensation will be paid to directors,  officers or other regular
employees   of  the  Company  for  such   services,   but   Corporate   Investor
Communications,  Inc.  will be paid its  customary  fee,  estimated  to be about
$6,000, if it renders solicitation services.


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  at the
Company's principal executive office, 2855 Campus

                                       1


<PAGE>


Drive,  San  Mateo,  California  94403, a written notice of revocation or a duly
executed  proxy  bearing  a  later  date  or  it may be revoked 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  1999  Annual  Meeting  must be  received by the
Company no later than  December  2, 1998,  in order that they may be included in
the proxy statement and proxy relating to that Annual Meeting.



                                  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 ................................................................  60          1988
 Chairman of the Board of the Company and President and Chief Executive
 Officer of Imedia Corporation (a video compression technology company).

Dan Avida ...................................................................  34          1994
 President and Chief Executive Officer of the Company.

Gill Cogan ..................................................................  45          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 ..................................................................  62          1996
 President of Applied Materials Inc. (a semiconductor manufacturing
 equipment company).

Jean-Louis Gassee ...........................................................  54          1990
 Chief Executive Officer of Be Inc. (a personal computer technology company).

Thomas I. Unterberg .........................................................  67          1990
 Managing Director of C.E. Unterberg Towbin (an investment banking firm).
</TABLE>



     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

                                        2


<PAGE>


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  electro-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 and 3Com 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.

     Mr.  Unterberg is the co-founder  and has served as a managing  director of
C.E.  Unterberg  Towbin,  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 Corporation, Systems & Computer Technology Corporation
and ECCS, Inc.

     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.

                                        3


<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 four (4)  meetings
during 1997. Each director attended 75% or more of the aggregate meetings of the
Board of  Directors  and of the  committees  thereof,  if any,  upon  which such
director served during 1997. The Board of Directors has an Audit Committee and a
Compensation Committee.

     The Audit  Committee  consists of Director Cogan and Director  Maydan.  The
Audit Committee  conducted no meetings during 1997. 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
undertook its actions by unanimous written consent during 1997. The Compensation
Committee reviews and approves the Company's  executive  compensation policy and
administers the Company's 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  Stock  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 Stock Plan, of which
22,500 shares remain outstanding. See "Proposal Two--Amendment to the 1990 Stock
Plan."



                                  PROPOSAL TWO
                        AMENDMENT TO THE 1990 STOCK PLAN


Background

     The Company has  adopted  two stock  plans,  the 1989 Stock 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 Stock 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.

                                        4


<PAGE>


     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.

     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 27, 1998, 35,132 shares of Common Stock and 1,446,449 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 30, 1998, 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.

                                        5


<PAGE>


     As of February  27, 1998,  13,241,088  and  13,535,285  options to purchase
shares  of  Common  Stock had been  granted  under the 1989 Plan and 1990  Plan,
respectively,  and a total of 10,343,332  options had been exercised  under both
Stock Plans. As of February 27, 1998,  7,675,087  options were outstanding under
the Plans at an average per share exercise price of $20.70.

     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 a stock option
bears a direct  relationship  to the  Company's  stock price,  the Board further
believes that stock options  motivate both  executive  officers and employees to
manage the Company in a manner which will benefit all stockholders.

     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.


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. References herein to the Board include
the Compensation Committee, as applicable.


Eligibility

     The 1990 Plan  provides  that  non-statutory  options may be granted to all
employees and  consultants of the Company.  Incentive  stock options may only be
granted to employees.  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 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 and as permitted under Section 152 of the Delaware

                                        6


<PAGE>


     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.

         (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 stock 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. At March 23, 1998, the closing price for the Company's Common
     Stock as  reported  on the NASDAQ  National  Market  System was $26.125 per
     share.  In the event of a  decline  in the  value of the  Company's  Common
     Stock,  the  Board  has the  authority  to  reduce  the  exercise  price of
     outstanding  options,  whether  incentive  or  non-statutory,  to the  then
     current 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.


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

                                        7


<PAGE>


and  in  the  number  of shares subject to each option and the maximum number of
shares  that may be awarded during any fiscal year. 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.


Amendment and Termination

     The  Board  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  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  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,  mid-term or short-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,  mid-term  or  short-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.  Section  162(m)  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

                                        8


<PAGE>


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 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  and as of the date of this  proxy  statement,  there  has been no
determination  by the Board  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.



                                 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, 1998, 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.

     Stockholder  ratification  of the selection of Price  Waterhouse LLP as the
Company's  independent  auditors  is not  required  by the  Company's  Bylaws or
otherwise.  However,  the Board is submitting the selection of Price  Waterhouse
LLP to the stockholders for ratification as a matter of good corporate practice.
If the  stockholders  fail to ratify the selection,  the Audit Committee and the
Board will reconsider  whether or not to retain that firm. Even if the selection
is ratified,  the Audit  Committee and the Board in their  discretion may direct
the appointment of different independent auditors at any time during the year if
they  determine that such a change would be in the best interests of the Company
and its stockholders.

     The affirmative  vote of the holders of a majority of the shares present in
person or  represented  by proxy and entitled to vote at the Annual Meeting will
be required to ratify the selection of Price Waterhouse LLP.

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

                                        9


<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 23, 1998 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 .........................................................  7,841,800        14.9%
 82 Devonshire Street
 Boston, Massachussetts 02109

T. Rowe Price Associates ................................................  6,111,300        11.6%
 100 East Pratt Street
 Baltimore, MD 21202

J&W Seligman & Company ..................................................  5,308,400        10.0%
 100 Park Avenue
 New York, NY 10017

Dan Avida (2) ...........................................................    774,800         1.5%

Jeffrey Lenches (3) .....................................................    252,992           *

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

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

Fred Rosenzweig (4) .....................................................     39,500           *

Eric Saltzman (3) .......................................................     10,000           *

Dan Maydan (5) ..........................................................      9,060           *

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

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

All executive officers and directors as a group (9 persons) (6) .........  1,417,852         2.7%

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

(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
     52,600,667  shares  outstanding on March 23, 1998,  adjusted as required by
     rules promulgated by the Securities and Exchange Commission (the "SEC").

(2)  Includes  705,236  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 23, 1998.

(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 23, 1998.

(4)  Includes  29,500  shares of Common Stock  issuable upon exercise of options
     granted to Mr. Rosenzweig under the 1990 Plan which are exercisable  within
     60 days of March 23, 1998.

(5)  Includes  7,500 shares of Common Stock  issuable  upon  exercise of options
     granted to Mr. Maydan under the 1990 Plan which are  exercisable  within 60
     days of March 23, 1998.

(6)  Includes an aggregate of 1,132,728 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 23,
     1998.
</FN>
</TABLE>


                                       10


<PAGE>



Compliance 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, 1997 to December  31,
1997, all Section 16(a) filing requirements applicable to officers, directors or
greater than ten percent beneficial owners were complied with.


 
                              EXECUTIVE OFFICERS

     The following table lists certain information  regarding executive officers
as of March 23, 1998.


            Name           Age    Position
- -------------------------  ---    ----------------------------------------------
Dan Avida ...............  34     President and Chief Executive Officer
Jeffrey Lenches .........  50     Executive Vice President
Fred Rosenzweig .........  42     Vice President, Manufacturing and Support
Eric Saltzman ...........  35     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. Mr.  Saltzman
holds a B.A. from Swarthmore College and a J.D. from Stanford Law School.

                                       11


<PAGE>



                             EXECUTIVE COMPENSATION


Compensation of Executive Officers


<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,  1997,  1996 and  1995 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.


                                                 Summary Compensation Table

<CAPTION>
                                                                                           Long-Term
                                                                                          Compensation
                                                         Annual Compensation                 Awards
                                               ---------------------------------------   -------------        All Other
                                                     Salary                Bonus           Number Of        Compensation
     Name and Principal Position       Year          ($) (1)              ($) (1)           Options              ($)
- ------------------------------------- ------   ------------------   ------------------   -------------   ------------------
<S>                                    <C>          <C>                <C>                  <C>              <C>
Dan Avida ...........................  1997         375,000            212,810(3)            90,000          179,876(2)
 President and                         1996         350,000            188,149(4)           150,000            6,000(8)
 Chief Executive Officer               1995         275,000            160,840(5)           200,000            6,000(8)
Jeffrey Lenches .....................  1997         255,000            135,597(6)            26,000            6,000(8)
 Executive Vice President              1996         217,000            116,871(6)            44,000            6,000(8)
                                       1995         177,125            127,116(6)            80,000            6,000(8)
Fred Rosenzweig .....................  1997         210,000             85,124(3)            26,000            4,600(8)
 Vice President, Manufacturing         1996         157,000(7)          56,448(4)            44,000            4,800(8)
 and Support                           1995         122,750             25,853(5)           114,000            4,800(8)

Eric Saltzman .......................  1997         185,000             59,992(3)            17,000            4,800(8)
 Vice President, Strategic Relations,  1996         143,750(7)          46,110(4)            30,000            4,800(8)
 General Counsel and Corporate         1995         113,375             10,044(5)            54,000            1,000(8)
 Secretary                                                                       

<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)  Consists of a $173,876  payment to compensate for personal tax consequences
     on   conversion   of  previously   granted   incentive   stock  options  to
     non-statutory   stock  options  at  the  Company's  request  and  a  $6,000
     automobile allowance.
(3)  Represents  bonuses accrued in 1997 under the Executive Bonus Plan and paid
     in March 1998.
(4)  Represents  bonuses accrued in 1996 under the Executive Bonus Plan and paid
     in January 1997.
(5)  Represents  bonuses accrued in 1995 under the Executive Bonus Plan and paid
     in January 1996.
(6)  Represents sales commissions.
(7)  Includes salary accrued in 1996 and paid in 1997.
(8) Automobile allowance.
</FN>
</TABLE>



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 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.


Compensation of Directors

     The members of the Board of Directors do not receive cash  compensation for
serving  on the  Board of  Directors  other  than  reimbursement  of  reasonable
expenses incurred in attending Board meetings.

                                       12


<PAGE>


Outside  members  of  the  Board  of Directors have received stock option grants
pursuant  to  the Stock Plans upon initially joining the Board of Directors. See
"Committees  of  the  Board  of  Directors -- Meetings of Board of Directors and
Committees" and "Proposal Two -- Amendment to the 1990 Stock Plan."

     During the last  fiscal  year,  the  Company  granted no options to outside
directors of the Company.


                        STOCK OPTION GRANTS AND EXERCISES

     The following  table sets forth  information  regarding stock option grants
made during the fiscal  year ended  December  31, 1997 to each of the  executive
officers named in the Summary Compensation Table.



<TABLE>
                                      Option Grants in Fiscal Year Ended December 31, 1997

<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 (3)
                               Granted        Employees     Price      Date of   Expiration  ---------------------------------
                                 (1)           in 1997    Per Share     Grant     Date (2)     0%        5%           10%
                          ----------------- ------------ ----------- ---------- ------------ ----- ------------- -------------
<S>                           <C>              <C>        <C>         <C>        <C>           <C>   <C>           <C>
Dan Avida ...............     90,000 (4)       5.6%       $  47.25    $  47.25    7/1/07       --     $2,674,374    $6,777,390
Jeffrey Lenches .........     26,000 (4)       1.6%          47.25       47.25    7/1/07       --        772,597     1,957,913
Fred Rosenzweig .........     26,000 (4)       1.6%          47.25       47.25    7/1/07       --        772,597     1,957,913
Eric Saltzman ...........     17,000 (4)       1.1%          47.25       47.25    7/1/07       --        505,160     1,280,174

<FN>
- ------------
(1) Options  granted  in 1997 are exercisable starting 12 months after the grant
    date,  with  25%  of  the  option  shares  becoming exercisable on the first
    anniversary  of  July  15,  1997,  with full vesting occurring on the fourth
    anniversary date.

(2) The  options  have  a  term  of  10 years, subject to earlier termination in
    certain events related to termination of employment.

(3) 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.

(4) These options were granted on July 1, 1997.
</FN>
</TABLE>



     The following  table sets forth  information  regarding  exercises of stock
options  during the fiscal year ended December 31, 1997 by each of the executive
officers named in the Summary Compensation Table.



<TABLE>
                                    Aggregated Option Exercises in Fiscal Year Ended
                                  December 31, 1997 and Fiscal Year End Option Values

<CAPTION>
                                                                 Number of                   Value of Unexercised
                                                            Unexercised Options              In-the-Money Options
                          Shares                                at 12/31/97                    at 12/31/97 (2)
                       Acquired on        Value       -------------------------------   ------------------------------
         Name            Exercise      Realized(1)     Exercisable     Unexercisable     Exercisable     Unexercisable
- --------------------- -------------   -------------   -------------   ---------------   -------------   --------------
<S>                      <C>           <C>               <C>             <C>             <C>               <C>
Dan Avida ...........    118,188       $5,480,663        705,236          302,500        $6,917,174        $381,250
Jeffrey Lenches .....    140,008        5,857,887        252,992           99,000         2,751,907         152,500
Fred Rosenzweig .....     68,500        2,884,195         11,000          128,500               --          506,000
Eric Saltzman .......     43,500        1,815,616            --            89,000               --          373,875

<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, 1997 minus the exercise
    price of such options.
</FN>
</TABLE>


                                       13


<PAGE>


                              EMPLOYMENT AGREEMENTS

     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 under the Executive  Incentive Plan
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.


 
                     REPORT OF THE 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 "Executive Compensation--Executive Incentive Plans."

     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

                                       14


<PAGE>


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
1998 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 "Employment Agreements").


                                            Submitted by:

 
                                            Jean-Louis Gassee
                                            Member of the Compensation Committee



                                            Thomas I. Unterberg
                                            Member of the Compensation Committee


           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, 1997. Thomas I.
Unterberg  has served on the  Compensation  Committee  of the Board of Directors
from his appointment in February 1995 through December 31, 1997.

                                       15


<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, 1997.


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

                                       Investment Value
                           -----------------------------------------
            Date            EFII      H&Q Technology    NASDAQ Comp.
           ------          -----      --------------    ------------

           10/2/92         $  100         $  100          $  100
           12/31/92        $  132         $  120          $  118
           12/31/93        $  110         $  131          $  136
           12/30/94        $  183         $  151          $  132
           12/29/95        $  583         $  226          $  184
           12/31/96        $1,097         $  272          $  226
           12/31/97        $  443         $  284          $  275
           

                                       16


<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

                                        /s/ Eric Saltzman
                                        -----------------------------
                                        Eric Saltzman
                                        Secretary




Dated: April 2, 1998

                                       17


<PAGE>

                                                                      1149 PS 98


<PAGE>


                                                                      Appendix A


                                  DETACH HERE


                                     PROXY

         This Proxy is solicited on behalf of the Board of Directors of


                         ELECTRONICS FOR IMAGING, INC.


                         ANNUAL MEETING OF STOCKHOLDERS
                                  MAY 7, 1998


     The undersigned  stockholder of ELECTRONICS  FOR IMAGING,  INC., a Delaware
corporation,  hereby  acknowledges  receipt of the  Notice of Annual  Meeting of
Stockholders and Proxy Statement,  each dated April 2, 1998, 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 1998 Annual Meeting
of Stockholders of ELECTRONICS FOR IMAGING, INC. to be held on Thursday,  May 7,
1998 at 9:00 a.m., Pacific Daylight Time, at Electronics for Imaging,  Inc., 331
Lakeside  Drive,  Foster  City,  California  94404,  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.


           PLEASE MARK, SIGN, DATE AND RETURN THE PROXY CARD PROMPTLY
                          USING THE ENCLOSED ENVELOPE


SEE REVERSE                                                          SEE REVERSE
   SIDE          CONTINUED AND TO BE SIGNED ON THE REVERSE SIDE          SIDE


<PAGE>


[X] Please mark
    votes as in
    this example


THIS PROXY WILL BE VOTED AS DIRECTED OR, IF NO CONTRARY  DIRECTION IS INDICATED,
WILL BE VOTED FOR THE ELECTION OF DIRECTORS, FOR THE AMENDMENT TO THE 1998 STOCK
PLAN,  FOR THE  RATIFICATION  OF THE  APPOINTMENT  OF  PRICE  WATERHOUSE  LLP AS
INDEPENDENT AUDITORS AND AS SAID PROXIES DEEM ADVISABLE ON SUCH OTHER MATTERS AS
MAY PROPERLY COME BEFORE THE MEETING.

<TABLE>
<CAPTION>

<S>                                                                  <C>
1. Election of Directors:                                            2. Proposal to approve an amendment        FOR  AGAINST ABSTAIN
   Nominess: Efraim Arazi, Dan Avida, Gill Cogan, Jean-Louis               to the 1990 Stock Plan               [ ]    [ ]     [ ]
             Gassee, Dan Maydan, Thomas I. Unterberg.
      FOR                   WITHHELD
      ALL    [ ]        [ ] FROM ALL                                 3. Proposal to ratify the appointment of   FOR  AGAINST ABSTAIN
   NOMINEES                 NOMINEES                                    Price Waterhouse LLP as                 [ ]    [ ]     [ ]
                                                                        independent auditors of the 
                                                                        Company for the fiscal year ending
                                                                        December 31, 1998.

[ ] _________________________________________
     For all nominees except as noted above                          4. In their discretion, upon such other matter or matters that
                                                                        may properly come before the meeting or any adjournments
                                                                        thereof.


                                                                      MARK HERE FOR ADDRESS CHANGE AND NOTE AT LEFT   [ ]

                                                                      This  Proxy  should  be  marked,   dated  and  signed  by  the
                                                                      stockholder(s)  exactly  as his or her  name  appears  on this
                                                                      proxy card,  and returned  promptly in the enclosed  envelope.
                                                                      When signing as attorney, executor, administrator, trustee, or
                                                                      guardian,  please give full title as such.  If a  corporation,
                                                                      please  sign in full  corporate  name by  President  or  other
                                                                      authorized   officer.   If  a  partnership,   please  sign  in
                                                                      partnership name by authorized  person.  If shares are held by
                                                                      joint tenants or as community property each should sign.


Signature: _________________________________ Date: ___________________ Signature: ______________________________ Date: _____________
</TABLE>