Peerless Technology to Ship on New Members of the Popular Tektronix Family of Phaser Color Printers.

A Leading Vendor of Workgroup Color Printers Selects Peerless'

Object-Based Imaging Technology for PCL Compatibility

EL SEGUNDO, Calif.--(BUSINESS WIRE)--Oct. 29, 1998--Peerless Systems Corporation (Nasdaq:PRLS), a leader in embedded imaging systems, today announced a new relationship with Tektronix, a leading vendor of workgroup color printers in the U.S. market. Tektronix has licensed and ported Peerless' PeerlessPrint(tm) 5C, the emulation of HP's popular PCL5c printing language, to allow their new printers compatibility in networked environments for both monochrome and color printing. Peerless Print(tm) 5C has been integrated into four new, recently announced Tektronix printers.

"We are proud to add Tektronix to our broad list of blue chip customers," said David Fournier, vice president of sales, marketing and field operations at Peerless. "This relationship benefits both Peerless and Tektronix. Our collaboration helped to enable Tektronix to produce better and lower cost products using Peerless technology, while extending Peerless' penetration into the workgroup color market with one of the market leaders."

"We are pleased to support PeerlessPrint(tm) 5C. Tektronix' revolutionary new line of laser and solid ink printers is focused on matching color printing choices with customer requirements, leading to fast, affordable business color printing," said Jean Nassar, vice president, worldwide marketing, color printing and imaging division for Tektronix. "This partnership has enhanced the versatility of Tektronix' products while allowing us to reach our price and time-to-market goals."

The Tektronix Phaser(r) 740L/740/780/840 printers are the newest generation of desktop color printers setting a new price/performance network-ready standard at a base street price of under $2000 for letter sized printers and under $5000 for full bleed 11" x 17" size printers. The Phaser 840 printer also sets a new speed standard of 10ppm for under $2500 with 1200 dpi solid ink technology.

"Tektronix' inclusion of both PCL and PS, which gives them compatibility across the board in the business market, along with breaking the $2,000 price barrier, are significant steps towards the widespread adoption of office color. IDC end-user research has shown that a $2,000 price range is key to penetrating the very large small-business market," said Angele Boyd, vice president, peripherals research at International Data Corporation (IDC).

Tektronix selected PeerlessPrint(tm) 5C to provide robust compatibility with HP's PCL5c printing language. The PeerlessPrint(tm) 5C technology is platform-independent and supports multiple engine technologies including color laser and solid ink. PeerlessPrint(tm) 5C provides OEMs with a proven, compatible product while integrating advanced features that provide critical product differentiation -- key reasons why customers look to Peerless for solutions they need to compete in the digital document marketplace.

Tektronix is part of a growing list of major OEMs worldwide who have licensed key software and/or supporting technology products from Peerless. Other OEMs include Adobe Systems, Canon, IBM, IBM Microelectronics, Minolta, Motorola, Ricoh, and Seiko Epson.

PeerlessPrint(tm) Language Emulations

In 1991, Peerless developed both the first variable resolution PCL 5 emulation, and the first PCL 5 emulation to support an output resolution of 600 dpi. In 1994 PeerlessPrint(tm) 5E was the first emulation to offer full compatibility with HP's LaserJet 4 by incorporating complete PCL 5e and printer job language (PJL) support. With PeerlessPrint(tm) 5C, Peerless extended the PeerlessPrint(tm) family to support the color capable PCL 5c language emulation, and most recently, PeerlessPrint(tm) 6 has allowed OEMs to provide full compatibility with HP's PCL6 printing language both on color and monochrome systems. Since 1994, Peerless has been the leading provider of PCL language emulations for the printer market.

More on Peerless Solutions

Peerless Systems Corporation's technologies utilize an object-based imaging model designed to reduce memory requirements and cost, and to increase performance and output quality. These solutions include Peerless' industry renowned family of PCL emulations, PeerlessPrint(tm) 5E, PeerlessPrint(tm) 5C, PeerlessPrint(tm) 6, and PeerlessPrint(tm) XL (emulating HP's PCL 5e, PCL 5c, PCL 6 and PCL XL, respectively), PeerlessPrint host software drivers, WinEXPRESS(tm), an optimized Windows printing language, PeerlessPage(tm) Imaging Environment, Memory Reduction Technology (MRT)(r), and the QuickPrint(tm) family of coprocessors. OEMs can license these technologies individually or integrate the entire solution into their systems.

More on Peerless Systems Corporation

Peerless Systems Corporation is a leading provider of software-based embedded imaging systems to original equipment manufacturers of digital document products. Digital document products include printers, copiers, fax machines, scanners and emerging 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. The Peerless family of products and engineering services provides advanced embedded imaging technologies that enable the Company's OEM customers to develop digital printers, copiers and multifunction products quickly and cost-effectively. Peerless Systems Corporation is located at 2381 Rosecrans Avenue, El Segundo, CA 90245. Main telephone: [phone]; facsimile: [phone]; website: www.peerless.com.

Peerless, Peerless Systems, PeerlessPage, PeerlessPowered, AccelePrint, All-Pages-Print, MultiPrint, PicturePrint, QuickPrint, SyntheSys and WinEXPRESS are trademarks of Peerless Systems Corp. Memory Reduction Technology (MRT) is a registered trademark of Peerless Systems Corp. PostScript is a registered trademark of Adobe Systems Incorporated. PCL is a registered trademark of Hewlett-Packard Company. All other brand and product names are trademarks or registered trademarks of their respective owners.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: With the exception of historical information, the statements set forth above include forward-looking statements that involve risk and uncertainties. These statements include company beliefs with respect to revenue growth and profitability. The company wishes to caution readers that a number of important factors could cause actual results to differ materially from those in the forward-looking statements. Those factors include the following: the fact that the company's markets are characterized by rapidly changing technology, evolving industry standards and frequent introductions of new products and enhancements, and the company's ability to respond to such changes; fluctuations in OEM shipments which generate the Company's license fee revenue; difficulties which the Company may experience in completing the development of turnkey designs for OEM customers, its digital photography technology, its integrated multifunction semiconductor solutions or other products; the fact that the multifunction and color markets targeted by the Company are at an early stage of development; the highly competitive nature of the markets for the Company's products; the Company's ability to attract and retain skilled personnel; the Company's reliance on third party suppliers for components used in the Company's products; the quarterly variability in the Company's bookings and design wins; and the Company's reliance on a relativity small number of OEM customers for a large percentage of its revenue. These and other factors which could cause actual results to differ materially from those in the forward-looking statements are also discussed in the Company's filings with the Securities and Exchange Commission, including its recent filings on Forms 10-K and 10-Q. The Company disclaims any obligation to update these statements for subsequent events.