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                                                                   EXHIBIT 10.25
                             EMPLOYMENT AGREEMENT
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     THIS AGREEMENT, dated as of December 20, 1999 (this "Agreement") by and
between HDE, Inc. (the "Company"), a Washington corporation, and Gordon L.
Hanson (the "Executive").

                                R E C I T A L S
                                - - - - - - - -

     A.  The Executive is currently employed as the President of the Company and
has made and is expected to continue to make major contributions to the short-
and long-term profitability, growth and financial strength of the Company;

     B.  The Company is currently contemplating a merger (the "Merger") with a
wholly owned subsidiary of Peerless Systems Corporation ("Peerless");

     C.  The Company desires to assure itself of both present and future
continuity of management in light of the Merger and subsequent to the Merger;
and

     D.  The Company desires to provide additional inducement for the Executive
to continue to remain in the ongoing employ of the Company.

     NOW, THEREFORE, in consideration of the foregoing premises and the mutual
covenants herein contained, the parties hereto agree as follows:

         1.  At-Will Employment.  Subject to the terms and conditions of this
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Agreement, the Company agrees to continue to employ Executive on an at-will
basis and Executive agrees to remain in the employ of the Company on an at-will
basis. With respect to periods following the Merger, references to the "Company"
shall include the surviving corporate parent in the Merger.

         2.  Position.  During his employment with the Company, Executive
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agrees to serve the Company, and the Company shall employ Executive, as Vice
President and General Manager, Imaging Products Division, or in such other
comparable or superior executive capacity or capacities as may be specified from
time to time by the Chief Executive Officer of the Company.

         3.  Operation Dates of Agreement; and Duties.
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             (1)  Operative Dates of Agreement. This Agreement shall be binding
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upon the parties hereto immediately upon its execution, but, anything in this
Agreement to the contrary notwithstanding, the operative provisions of this
Agreement shall not be effective unless
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and until the Merger is consummated. Upon the closing of the Merger, without
further action, this Agreement shall become immediately in effect. After the
operative date, this Agreement shall continue in effect during Executive's
employment with the Company until the first (1st) anniversary of the closing
date of the Merger, at which time this Agreement shall automatically terminate
without further action.

              (2)  Duties.  During his employment under this Agreement, and
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except for illness, vacation periods and leaves of absence, all in accordance
with the policies and procedures of Peerless in effect from time to time,
Executive shall devote his best efforts and substantially all his business time,
attention, skill and efforts to the business and affairs of the Company and its
affiliated companies, as such business and affairs exist immediately following
consummation of the Merger and as they may be hereafter changed or added to,
under and pursuant to the general direction of the Board of Directors of the
Company; provided, however, that, with the approval of the Chief Executive
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Officer of the Company (which shall not be unreasonably withheld), Executive may
serve, or continue to serve, on the boards of directors of, or hold any other
offices or positions in, companies or organizations which, in such officer's
judgment, will not present any conflict of interest with the Company or any of
its subsidiaries or affiliates or divisions, or materially affect the
performance of Executive's duties pursuant to this Agreement. The Company shall
retain full direction and control of the means and methods by which Executive
performs the services for which he is employed hereunder. The services which are
to be performed by Executive hereunder are to be substantially rendered in the
State of Washington.

          4.  Compensation and Reimbursement of Expenses;
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              Other Benefits;
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              (1)  Compensation.  During his employment under this Agreement,
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Executive shall be paid a salary at the rate of $150,000.00 per year, or such
higher salary as may be from time to time approved by the Board of Directors (or
any duly authorized committee thereof) of the Company ("Base Salary"), plus such
additional incentive compensation, if any, as may be voted to him yearly by the
Board of Directors (or any duly authorized committee thereof).

              (2)  Reimbursement of Expenses.  The Company shall pay or
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reimburse Executive, in accordance with its normal policies and practices, for
all reasonable travel and other expenses incurred by Executive in performing his
obligations under this Agreement.

              (3)  Other Benefits.  During the period of employment under this
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Agreement, Executive shall be entitled to receive all other benefits of
employment generally available to other members of the Company's management and
those benefits for which
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executives are or shall become eligible, when and as he becomes eligible
therefor, including, without limitation, three weeks of paid vacation.

              (4)  Stock Options.  Executive shall be granted an option with
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respect to 65,000 shares of Peerless common stock (the "Base Amount") which is
to vest over a four year period in equal annual amounts of 16,250 shares, with
the first vesting date occurring on the date that is one year from the closing
date of the Merger, and the remaining vesting dates occurring on each subsequent
anniversary of such closing date. The grant will be effective upon the closing
of the Merger, and the exercise price shall be equal to the closing price of the
common stock of Peerless on the Nasdaq National Market on the business day
immediately following consummation of the Merger. As long as the Executive
remains an executive of the Corporation, Executive shall also be eligible to
participate in the long term stock option incentive stock option program under
the Peerless' Executive Compensation Plan, as made available and in accordance
with the policies and procedures of said Plan.

              (5)  Bonus.  Provided that the total cash and cash equivalents
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reflected in the Final Closing Balance Sheet is greater than the Minimum Cash
Balance (as such items are defined in the Merger Agreement), Executive shall be
entitled to receive a one-time cash bonus in an amount equal to such excess.
Executive shall also be eligible to receive an annual bonus, up to a maximum of
fifty thousand dollars ($50,000), based upon earnings per share goals for the
entire company, as may be determined by the Board of Directors of the Company.

          5.  Termination.
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              (1)  For Cause.  Notwithstanding anything herein to the contrary,
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and specifically reiterating the at-will nature of Executive's employment, which
can be terminated by either Executive or Company for any reason or no reason
without advance notice, the Company may, without liability, also terminate
Executive's employment hereunder for Cause (as defined herein) at any time upon
written notice from the Board of Directors (or any duly authorized committee
thereof). As used herein, Cause shall mean the occurrence of any of the
following events: (i) Executive's conviction of or guilty plea to the commission
of an act or acts constituting a felony under the laws of the United States or
any state thereof; (ii) action by Executive toward the Company involving
personal dishonesty, theft or fraud in connection with Executive's duties as an
officer of the Company; or (iii) Executive's willful failure to abide by or
follow lawful directions of the Board of Directors that is not cured after
notice to the Executive. If the Company terminates Executive's employment for
Cause, Executive's right to compensation under this Agreement will terminate as
of the date of such termination and all of the Company's obligations hereunder
shall immediately cease and terminate, except that Executive shall be entitled
to receive all compensation to which he is due under federal and state law or
pursuant to Company policy up through and including the date of termination.
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              (2)  Death.  If Executive's employment hereunder is terminated by
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reason of Executive's death, Executive's (or Executive's estate's) right to
compensation under this Agreement will terminate as of the date of such
termination and all of the Company's obligations hereunder shall immediately
cease and terminate, except that Executive's estate will be entitled to received
all compensation to which Executive is due under federal and state law or
pursuant to Company policy up through and including the date of termination.

              (3)  Disability.  If the Company terminates Executive's employment
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by reason of Executive's Disability (as defined herein), Executive's right to
benefits under this Agreement will terminate as of the date of such termination
and all of the Company's obligations hereunder shall immediately cease and
terminate, except that Executive shall be entitled to receive all compensation
to which Executive is due under federal and state law or pursuant to Company
policy up through and including the date of termination. As used herein,
Executive's Disability shall mean that, due to physical or mental illness,
Executive shall have been absent from his duties hereunder on a full-time basis
for one hundred eighty (180) consecutive days, and within thirty (30) days after
written notice of termination is given (which may occur before or after the end
of such 180-day period) Executive shall not have returned to the performance of
his duties hereunder on a full-time basis.

              (4)  Termination by the Company other than for Cause, Death, or
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Disability, or Termination by Executive for Good Reason. If the Company
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terminates Executive's employment for any reason other than for cause, death or
disability, pursuant to Sections 5(a)-(c) above, or Executive terminates his
employment for Good Reason (as defined herein) then, notwithstanding anything
herein to the contrary and in complete satisfaction and discharge of all of its
obligations to Executive hereunder, Executive shall be entitled to receive all
compensation to which Executive is due under the terms of this Agreement as if
the Executive had remained in the employment of the Company during the term of
this Agreement as set forth in Section 3(a) hereof. For purposes of this
Agreement, Executive shall have "Good Reason" to terminate his employment with
the Company following the occurrence of any of the following events, without
Executive's written consent thereto, provided, that Executive shall have given
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Company written notice specifying the conduct alleged to have constituted such
Good Reason and Company has failed to cure such conduct, if curable, within
fifteen (15) days following receipt of such notice:

                   (A) Any failure to elect or reelect or otherwise to maintain
     Executive in the office or the position, or a substantially equivalent
     office or position, of or with the Company, as described in Paragraph 2;

                   (B) A significant adverse change in the nature or scope of
     the authorities, powers, functions, responsibilities or duties described in
     Paragraph 3(b);

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                   (C) A reduction in Executive's Base Salary described in
     Paragraph 4(a);

                   (D) The Company requires the Executive to have his principal
     location of work changed to any location that is outside a one hundred
     (100) mile radius of the greater Seattle, Washington area; or

                   (E) Without limiting the generality or effect of the
     foregoing, any material breach of this Agreement by the Company or any
     successor.

              (5)  Termination by Executive other than for Good Reason.  If
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Executive terminates his employment hereunder for any reason other than for Good
Reason, Executive shall be entitled to receive all compensation to which
Executive is due under federal and state law or pursuant to Company policy up
through and including the date of termination.

          6.  Obligations of Executive During and After Employment.
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              (1)  Executive agrees that during his employment under this
Agreement, he will engage in no other business activities, directly or
indirectly, which are or may be competitive with or which might place him in a
competing position to that of the Company, or any affiliated company, without
the prior written consent of the Chief Executive Officer of the Company.

              (2)  Executive acknowledges and agrees that (i) during the course
of his employment Executive will have produced and/or have access to
confidential information, records, notebooks, data, formulae, specifications,
trade secrets, customer lists and secret inventions and processes of Company and
its affiliated companies, and (ii) the unauthorized use or sale of any of such
confidential or proprietary information at any time would constitute unfair
competition with Company. Executive promises and agrees not to engage in any
unfair competition with Company either during or after the term of this
Agreement. Therefore, during and subsequent to his employment by Company, or by
an affiliated company, Executive agrees to hold in confidence and not, directly
or indirectly, disclose, use, copy or make lists of any such information, except
to the extent expressly authorized by Company in writing. All records, files,
drawings, documents, equipment, and the like, or copies thereof, relating to
Company's business, or the business of an affiliated company, which Executive
shall prepare, or use, or come into contact with, shall be and remain the sole
property of Company, or of an affiliated company, and shall not be removed
(except to allow Executive to perform his responsibilities hereunder while
traveling for business purposes or otherwise working away from his office) from
the Company's or the affiliated company's premises without its prior written
consent, and shall be promptly returned to Company upon termination of
employment with Company and its affiliated companies. This paragraph 6(b) shall
survive the termination or expiration of this Agreement.
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          7.  General Provisions.
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              (1)  Executive's rights and obligations under this Agreement shall
not be transferable by assignment or otherwise, nor shall Executive's rights be
subject to encumbrance or subject to the claims of Company's creditors. Nothing
in this Agreement shall prevent the consolidation of Company with, or its merger
into, any other corporation, or the sale by Company of all or substantially all
of its properties or assets; and this Agreement shall inure to the benefit of,
be binding upon and be enforceable by, any successor surviving or resulting
corporation, or other entity to which such assets shall be transferred. This
Agreement shall not be terminated by the voluntary or involuntary dissolution of
the Company.

              (2)  This Agreement and the rights of Executive with respect to
the benefits of employment referred to in Paragraph 4 constitute the entire
agreement between the parties hereto in respect of the employment of Executive
by Company. This Agreement supersedes and replaces all other prior oral and
written agreements, understandings, commitments, and practices between the
parties.

              (3)  Any dispute, controversy or claim arising under or in
connection with this Agreement, or the breach hereof, shall be settled
exclusively by arbitration in accordance with the Rules of the American
Arbitration Association then in effect. Judgment upon the award rendered by the
arbitrator may be entered in any court of competent jurisdiction. Any
arbitration held pursuant to this paragraph in connection with any termination
of Executive's employment shall take place in Northern California at the
earliest possible date. If any proceeding is necessary to enforce or interpret
the terms of this Agreement, or to recover damages for breach thereof, the
prevailing party shall be entitled to reasonable attorneys fees and necessary
costs and disbursements.

              (4)  The provisions of this Agreement shall be regarded as
divisible, and if any of said provisions or any part thereof are declared
invalid or unenforceable by a court of competent jurisdiction, the validity and
enforceability of the remainder of such provisions or parts thereof and the
applicability thereof shall not be affected thereby.

              (5)  This Agreement may not be amended or modified except by a
written instrument executed by Company and Executive.

              (6)  This Agreement and the rights and obligations hereunder shall
be governed by and construed in accordance with the laws of the State of
California.

              (7)  If, but for one or more provisions of this Agreement, the
Merger would qualify for "pooling of interests" accounting treatment, then (A)
this Agreement shall, to the extent practicable, be interpreted and/or reduced
in scope or effect to the extent necessary to permit such accounting treatment,
and (B) to the extent that the application of clause (A) of this
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Section 8(g) does not preserve the availability of such accounting treatment,
then, to the extent that any provision of this Agreement would disqualify the
Merger as a "pooling" transaction (including, if applicable, the entire
Agreement), such provision shall be null and void as of the effective date
hereof. All determinations under this Section 8(g) shall be made by the
accounting firm whose opinion with respect to "pooling of interests" treatment
is required as a condition to the consummation of the Merger.

              IN WITNESS WHEREOF, the parties have executed this Employment
Agreement as of the date first above written.


                                              HDE, Inc.



                                              By /s/ Edward A. Gavaldon
                                                -----------------------
                                              Name:  Edward A. Gavaldon
                                              Title:  President


                                              EXECUTIVE


                                              By /s/ Gordon L. Hanson
                                                 --------------------
                                              Name:  Gordon L. Hanson