X0203 3 2010-02-01 0 0000897893 PEERLESS SYSTEMS CORP PRLS 0001483607 Shpiz Andrew 50 BROAD STREET, SUITE 1820 NEW YORK NY 10004 0 0 1 0 Common Stock 3599320 I See footnotes Options to Acquire Common Stock (Right to Buy) 1.95 2019-06-05 Common Stock 60000 I See footnotes The shares of Common Stock reported herein as indirectly beneficially owned by Andrew Shpiz (the "Master Fund Shares") are directly owned by Bandera Master Fund L.P., a Cayman Islands exempted limited partnership ("Bandera Master Fund"). Bandera Master Fund may be deemed a "director by deputization" of the Issuer by virtue of the fact that Gregory Bylinsky and Jefferson Gramm serve as directors of the Issuer as nominees of Bandera Master Fund. Mr. Bylinsky and Mr. Gramm will hold any stock, stock options, restricted stock or stock units or other rights to purchase or receive stock issued to them as compensation for their services as directors of the Issuer (together with the Master Fund Shares, the "Master Fund Securities") as nominees, and for the benefit, of Bandera Master Fund. Options to acquire 60,000 shares of Common Stock were received in connection with the election of Mr. Bylinsky and Mr. Gramm as directors of the Issuer on June 5, 2009. Twenty-five percent (25%) of the shares subject to such options shall vest and become exercisable on June 5, 2010 (the completion of one year of service measured from the grant date). The balance of the shares subject to such options shall vest and become exercisable in a series of thirty-six (36) successive equal monthly installments upon completion of each additional month of service until all of the options are vested. Bandera Partners LLC is the investment manager of Bandera Master Fund and may be deemed to have beneficial ownership of the Master Fund Securities by virtue of the sole and exclusive authority granted to Bandera Partners LLC by Bandera Master Fund to vote and dispose of the Master Fund Securities. Mr. Shpiz joined Bandera Partners LLC as a Managing Partner, Managing Director and Portfolio Manager effective on February 1, 2010. Mr. Shpiz may be deemed to have beneficial ownership of the Master Fund Securities in his capacity as Managing Partner, Managing Director and Portfolio Manager of Bandera Partners LLC. Indirect beneficial ownership of the Master Fund Securities has not been allocated to Mr. Shpiz on a proportional basis. Mr. Shpiz disclaims beneficial ownership of the Master Fund Securities except to the extent of his pecuniary interest therein pursuant to Rule 16a-1(a)(2). /s/ Andrew Shpiz 2010-02-11