Peerless Expands Adobe Relationship and Demonstrates New Adobe Technologies at Seybold.

Business Editors & High-Tech Writers

Seybold San Francisco 2001

SAN FRANCISCO--(BUSINESS WIRE)--Sept. 24, 2001

Peerless Continues to Offer Fast Time to Market Solutions

for the Latest Adobe Printing and Imaging Technologies

Peerless Systems Corporation (Nasdaq:PRLS), a provider of embedded imaging and networking solutions, announced today the availability of the latest release of Adobe(R) PostScript(R) printing and imaging technologies which support the Adobe Portable Document Format (PDF) 1.4 specification from Peerless. These technologies will be demonstrated at the Seybold San Francisco 2001 publishing trade show September 24-28. The strategic relationship between Peerless and Adobe expands Peerless' range of options for PostScript solutions. The breadth of this relationship establishes Peerless as the largest provider of embedded technologies for Adobe PostScript-based solutions.

"We are very pleased to have Peerless as a strategic partner and a premier provider of our embedded imaging solutions," says Susan Altman Prescott, VP Marketing Cross Media Publishing, Adobe Systems Inc. "Peerless is uniquely qualified to be a strong partner for Adobe as they can both license the PostScript technology as well as provide customization and porting services to printer OEMs wanting Adobe technologies as the underlying technology of their solutions."

"One of our primary objectives at Peerless is to provide OEMs with a single source of technology for imaging," said Howard Nellor, president and CEO of Peerless. "We're proud of our strong and growing relationship with Adobe and intend to continue to provide our customers with the most advanced solutions available."

Since the first Adobe-Peerless partnership agreement in 1992, Peerless has enabled Adobe PostScript in every printer it has developed requiring PostScript printing. Today Peerless develops turnkey products, enables Adobe PostScript 3 development, and offers direct PostScript 3 licensing via software development kits (SDKs) as well as custom porting services to OEM companies such as Canon, Ricoh, Seiko Epson, Okidata, Hitachi, Konica, Genicom, and Hitachi Koki.

Peerless offers a flexible business model to help printer OEMs get PostScript products to market quickly. For OEMs who prefer to perform their own development, Peerless offers PostScript in an SDK package. For OEMs looking for engineering assistance, Peerless can provide both co-development and full turnkey controller development services for printers and MFPs. Peerless can also provide PostScript 3 porting services or custom SDKs for OEM specific platforms.

Adobe PostScript 3 offers unparalleled quality and reliability, with consistent output from the desktop to production printers. PostScript 3 adds smooth blends, hi-fi color, and transparent elements to enhance the impact of the printed image. There are new operators to support fast image processing and smooth shading. Adobe Portable Document Format (PDF) is the master container format to preserve a document's original layout, fonts, and graphics in a single file. Adobe PDF files are truly portable across platforms and provide a reliable, efficient way to deliver digital files for print production.

Peerless will host a technology suite at the Argent Hotel in San Francisco. The Argent is located at 50 Third St., San Francisco, CA 94103. Please contact Peerless directly for more information at 310/536-0908.

About Peerless Systems Corporation

Peerless Systems Corporation, headquartered in El Segundo, California, is a provider of software-based embedded imaging and networking systems to original equipment manufacturers of digital document products and software utilities to OEMs of Network Attached Storage devices. Digital document products include printers, copiers, fax machines, scanners and color products, as well as multifunction products that perform a combination of these imaging functions. In order to process digital text and graphics, digital document products rely on a core set of imaging software and supporting electronics, collectively known as an embedded imaging system. Embedded networking systems supply the core software technologies to digital document products that enable them to communicate over local area networks and the Internet. The Company has also developed software utilities for OEMs of Network Attached Storage devices and is developing software utilities for end users of Storage Area Network devices.

Peerless Systems Corporation was founded in 1982 and has been listed on the NASDAQ Market since 1996. Peerless maintains relationships with many OEMs of digital document products. Its customer base includes blue chip companies such as Canon, IBM, Kyocera, Minolta, Ricoh, Seiko Epson, and Xerox. Peerless also holds strategic partnerships with IBM Microelectronics, Motorola, and Novell.

For more information, please call 310/536-0908 or visit the web site at www.peerless.com.

All trademarks herein are the property of their respective owners. This news release refers to various products and companies by their trade names. In most, if not all, cases these designations are claimed as trademarks or registered trademarks by their respective companies.

Safe Harbor Statement under the U.S. Private Securities

Litigation Reform Act of 1995

This Release contains forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995. Statements prompted by, qualified by or made in connection with such words as "anticipates," "believes," "continues," "enables," "establishes," "estimates," "expands," "expects," "growing," "intends," "objectives," "offers," "provides," "projects," "plans," "will be" and words of similar substance signal forward-looking statements. Likewise, the use of such words in connection with or related to any discussion of or reference to future business operations, product availability and operation, opportunities or financial performance sets apart forward-looking statements.

In particular, statements regarding the Company's outlook for future business, financial performance and growth, including projected revenue, both quarterly and from specific sources, profit, spending, including spending on research and development efforts and investments in the Imaging and Storage businesses, customer relationships, costs and the Company's cash position, as well as statements regarding expectations for overall product performance improvements, new product development and offerings, customer demand for the Company's products and services, market demand for products incorporating the Company's technology, future prospects of the Imaging and Storage businesses, and the impact on future performance of organizational and operational changes, all constitute forward-looking statements.

These forward-looking statements are just predictions and best estimations consistent with the information available to the Company at this time. Thus they involve known and unknown risks and uncertainties such that actual results could differ materially from those projected in the forward-looking statements made in this release.

Risks and uncertainties include, but are not limited to: a) ongoing changes in the markets in which Peerless offers Adobe solutions; b) the failure of Peerless' business relationship with Adobe to produce the projected financial results in the Imaging marketplace; c) the failure of Peerless to maintain its margins due to changes in its business model in reaction to competitive pressures; d) the delay in or the non-acceptance by the market of Adobe technologies and related new Peerless product and technology offerings; f) the failure of Peerless' markets to achieve expected growth rates; g) continuing worldwide unfavorable economic conditions resulting in decreased demand for original equipment manufacturers' ("OEMs") products using the product offerings described in this Release, making it difficult for Peerless to obtain new licensing agreements; h) OEMs' determinations not to proceed with development of products using Adobe solutions and related Peerless' technology due to, among other things, the economic slowdown currently experienced by business worldwide, changes in the demand for anticipated OEM products, age of the technologies described in this Release, concerns about Peerless' financial position and Adobe's and Peerless' competitors offering alternative solutions; i) the lack of acceptance of Adobe solutions; j) competitors coming to market with new products or alternative solutions that are superior or available at a lower cost or earlier than anticipated or believed to be possible; k) Peerless' failure to adequately protect its intellectual property for its imaging and networking solutions; l) termination of or a major negative shift in the Adobe-Peerless relationship; and m) other factors affecting Peerless' business and the forward looking statements set forth herein and as described more fully from time to time in Peerless' public filings with the Securities and Exchange Commission, including but not limited to the Company's most recent Annual Reports on Forms 10-K dated January 31, 2001 in the Section called Risks and Uncertainties at pages 33 through 42, inclusive, filed on or about May 1, 2001 and the Company's most recent Quarterly Report on Form 10-Q dated July 31, 2001 in the Section called Risks and Uncertainties at pages 18 through 27, inclusive, filed on or about September 14, 2001.

Current and prospective stockholders are urged not to place undue reliance on forward-looking statements, which speak only as of the date hereof. The Company is under no obligation, and expressly disclaims any obligation, to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. All forward-looking statements contained herein are qualified in their entirety by the foregoing cautionary statements.