KYOCERA
      MITA Corporation

                          
                            2-28,
      1-Chome, Tamatsukuri,

                            
                              Chuo-ku, Osaka 540-8585 Japan

                            

                          

                        	
                          

                        


                

              

            

          

        

      

    

    


    May 26,
2009

    


    Mr.
Edward Gaughan

    Peerless
Systems Corporation

    2381
Rosecrans Avenue

    El
Segundo, California 90245 U.S.A.

    


    


    Re: Early Release of Escrow
Funds

    


    


    Dear Mr.
Gaughan:

    


    This
letter amends and supplements: (i) the Asset Purchase Agreement, dated as of
January 9, 2008, as amended and in effect immediately prior to the execution of
this letter agreement (the “APA”), between Kyocera Mita Corporation (”Buyer”)
and Peerless Systems Corporation (the “Seller”), and (ii) the General Escrow
Agreement, dated April 30, 2008, (the “Escrow Agreement”) among City National
Bank, Buyer and Seller.  Capitalized terms used but not otherwise
defined herein shall have the meanings set forth in the APA and the Escrow
Agreement.

    


    Pursuant
to Section 2.4(a) of the APA, at the Closing on April 30, 2008, Buyer paid Four
Million Dollars ($4,000,000) to the Escrow Agent as the Holdback
Amount.  Under Sections 2.4(b) and (c) of the APA and Sections 1.3.4
and 1.3.5 of the Escrow Agreement, Two Million Dollars ($2,000,000) of the
Holdback Amount is to be paid to Seller on each of July 30, 2009 (the “First
Release Date”) and April 30, 2010 (the “Second Release Date”), subject to
reduction for indemnification claims made by Buyer pursuant to Article 9 of the
APA.

    


    Upon
request by Seller, Buyer and Seller have agreed to the termination of the Escrow
Agreement and a release of the Escrow Funds, plus any accrued and undisbursed
interest thereon, pursuant to the following terms and conditions:

    


    
      	
               
      

            	
              1.

            	
              The
      Escrow Agreement shall be terminated and the Escrow Funds shall be
      distributed pursuant to this letter agreement on such date as shall be
      agreed upon by Buyer and Seller, which date shall be as soon as
      practicable, but not later than June 4, 2009 (the “Early Release
      Date”).   Buyer and Seller shall take such actions and
      provide such instructions to the Escrow Agent with sufficient advance
      notice to enable the Escrow Agent to make the payments set forth in
      Section 2 hereof on or before the Early Release
  Date.

            


    

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

     

    
      	
               
      

            	
              2.

            	
                      (a)  Buyer
      and Seller shall provide a joint written instruction to the Escrow Agent,
      directing the Escrow Agent to pay to Buyer on the Early Release Date a
      portion of the Escrow Funds as set forth
below:

            


    

    


    


                                               

    
      
        
          
            	
                    If
      paid on

                  	Amount
      Paid to Buyer:
	
                    27-May-09

                  	
                     $               202,100

                  
	
                    28-May-09

                  	
                     $               201,108

                  
	
                    29-May-09

                  	
                     $               200,116

                  
	
                    1-Jun-09

                  	
                     $               197,138

                  
	
                    2-Jun-09

                  	
                     $               196,145

                  
	
                    3-Jun-09

                  	
                     $               195,152

                  
	
                    4-Jun-09

                  	
                     $               194,158

                  
	
                    5-Jun-09

                  	
                     $               166,226

                  


          

        

      

    

    


    Every day
after June 5, 2009, the Amount Paid to Buyer shall decrease by $857.31 per
day.

    


    (b)  Buyer
and Seller shall provide a joint written instruction to the Escrow Agent
directing the Escrow Agent to pay to Seller all Escrow Funds remaining in the
Escrow Account following the payment to Buyer pursuant to paragraph (a), plus
all interest accrued on the Escrow Funds since the Closing Date.

    


    (c)  Buyer
and Seller shall request a written invoice from the Escrow Agent for all fees
and amounts owed to the Escrow Agent pursuant to the Escrow
Agreement.  As soon as practicable after receipt of such invoice, each
of Buyer and Seller shall pay to the Escrow Agent an amount equal one half of
all fees owed to the Escrow Agent; provided that either Buyer or Seller, in its
sole discretion, may request the Escrow Agent to withhold such amount from any
payments owed to such party pursuant to this Section 1.  The Buyer and
Seller shall also provide written notice to the Escrow Agent to terminate the
Escrow Agreement pursuant to Section 9 thereof.

    


    
      	
               
      

            	
              3.

            	
              Seller
      and Buyer shall jointly instruct and take all other required action to
      cause the Escrow Agent to release the Escrow Funds and cause the Escrow
      Agreement to be terminated on the Early Release Date in accordance with
      this letter agreement.

            


    

    


    
      	
               
      

            	
              4.

            	
              (a)    Seller
      and Buyer agree that the early release of the Holdback Amount shall
      not in any manner modify, reduce or limit Seller’s indemnification
      obligations under Article 9 and other provisions of the APA, including,
      without limitation, the 24 month survival period of Seller’s
      representation and warranties and related indemnification claims, as set
      forth in Section 11.2 of the APA.  All of the terms and
      conditions in the APA, other than with respect to the
      early release of the Holdback Amount shall remain unchanged and in full
      force and effect.

            


    

     

    (b)   Notwithstanding paragraph a, Buyer and
the Buyer Indemnified Parties hereby voluntarily, knowingly and willingly
release, acquit and forever discharge Seller and each of Seller’s former,
current and future parents, subsidiaries, divisions, affiliates, predecessors,
successors and assigns and all of their current, former and future agents,
employees, officers, directors, stockholders, attorneys, representatives,
successors and assigns from any and all Indemnified Losses directly or indirectly resulting from,
arising out of, or imposed upon or incurred by any Buyer Indemnified
Party on or before the
date hereof, provided, that the foregoing release shall only apply to Indemnified Losses relating to, resulting from or arising
out of facts or circumstances which were known, or should have been
known, in each case on or
before the date
hereof after due inquiry, by a Buyer
Indemnified Party  or its directors, officers,
employees, attorneys or
representatives. Buyer and the Buyer Indemnified Parties
shall not be entitled to assert any claim under Article 9 or any other provision of the APA with respect to such
Indemnified Losses.  

    


    This
letter agreement does not modify or amend the APA or the Escrow Agreement,
except as expressly set forth herein.

     

    
      
         

      

      
         

        
          

        

      

      
         

      

    

    


    Please
sign and return this letter to indicate your agreement with the above
terms.  Copies of this letter transmitted by facsimile, email or other
electronic media shall be binding on the signing party.  Each party
represents and warrants that the person who signs this letter on its behalf is
its authorized representative.

    


     

    Sincerely,

    


    KYOCERA
MITA CORPORATION

    


    /s/ Katsumi
Komaguchi

    By:

    Name:
Katsumi Komaguchi

    Title
President

    


     

    Acknowledged
and Agreed,

    


    PEERLESS
SYSTEMS CORPORATION

    


    By: /s/ Edward
Gaughan

    Name:  Edward
Gaughan

    Title:  President