The 26-year-old Peguero has spent parts of the last three seasons with Seattle. He is a career .195 hitter with nine home runs and 27 RBIs in 219 at-bats in the majors.
He ranked seventh in the Pacific Coast League with 19 homers in 2013, along with a .260 batting average, 28 doubles and 83 RBIs at Triple-A Tacoma. Peguero was designated for assignment on Jan. 16 when the Mariners signed free agent catcher John Buck.
Kansas City also designated left-handed pitcher Everett Teaford for assignment. Teaford made one appearance for the Royals in 2013, pitching two-thirds of an inning at Cleveland on July 14.
Seattle also agreed to a minor league contract with 32-year-old right-hander Scott Baker, who had elbow ligament replacement surgery in April 2012. He made three starts for the Chicago Cubs last September, pitching 15 innings with a 3.60 ERA and no record. Baker has a 63-48 record with a 4.14 ERA in 162 starts and four relief appearances with Minnesota (2005-11) and the Cubs.