EXHIBIT 10.21

                    AMENDED AND RESTATED EMPLOYMENT AGREEMENT


              AGREEMENT by and between Golden Books Family Entertainment, Inc.
(the "Company"), and Philip Galanes (the "Executive"), effective as of May 7,
1998 (the "Effective Date").


              1.   Employment Term. The Company hereby agrees to employ
the Executive, and the Executive hereby agrees to enter the employ of the
Company, commencing on the Effective Date and continuing through and including
May 6, 2002, unless terminated earlier in accordance with Section 4 below.

              2.   Title, Reporting and Duties.

                   (a)  Commencing on the Effective Date and for the remainder
of the Employment Term, the Executive shall serve as the Company's General
Counsel and Senior Vice President of Legal Affairs, with such duties,
responsibilities and authority in such capacities as shall be consistent
therewith. The Executive shall be based in New York City.

                  (b)  In the Executive's capacity as General Counsel and
Senior Vice President of Legal Affairs, he shall report to the Company's
Chairman and Chief Executive Officer.

                   (c)  During the Employment Term, and excluding any periods of
vacation, holiday and sick leave to which the Executive is entitled, the
Executive agrees to devote full time during normal business hours to the
business and affairs of the Company and to use the Executive's best efforts to
perform faithfully and efficiently such responsibilities.

              3.   Compensation and Benefits.

                   (a)  Base Salary. During the Employment Term, the Executive
shall receive an annual base salary ("Annual Base Salary") of $350,000 for the
first year of the term, $375,000 for the second year of the term, $400,000 for
the third and fourth years of the term, provided that the Company agrees to
consider in good faith an increase of the Annual Base Salary in the fourth year
of the term. The Annual Base Salary will be reviewed by the Company's
Compensation Committee at the end of each year of the term and may be increased
at the discretion of the Compensation Committee. The Annual Base Salary shall be
paid in equal biweekly installments.

                   (b)  Annual Bonus. In addition to Annual Base Salary, the
Executive shall be awarded, for each fiscal year during the Employment Term, an
annual bonus (the "Annual Bonus") pursuant to the Company's annual incentive
plans (the "Annual Plans"). The Executive shall have a target annual bonus of
100% of his Annual Base Salary (the "Target


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Bonus") and a maximum level Annual Bonus of 200% of his Annual Base Salary,
subject in each case to attainment of the performance goals set forth in the
Annual Plans. Bonuses shall be paid no later than the end of the third month of
the fiscal year next following the fiscal year for which the Annual Bonus is
awarded, unless the Executive shall elect to defer the receipt of such Annual
Bonus. Notwithstanding the above, it is the intent of the parties hereto that
the Annual Plans meet all applicable requirements for the exemption of the
payments thereunder from the limitations of Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code") including the requirement that the
Annual Plans be approved by the shareholders of the Company prior to the payment
of any bonuses thereunder. The Board may award the Executive bonuses other than
pursuant to the Annual Plans in its discretion.

                   (c)  Stock Options. The Executive will be granted, as of the
Effective date hereof, a stock option (the "Option") to purchase 200,000 shares
of the Company's common stock ("Stock"). Executive acknowledges that certain
action will need to be taken by the Board of Directors and the Compensation
Committee to effectuate such Option grant. The exercise price with respect to
each share of Stock subject to the Option will be the last transaction price of
the Stock on the NASDAQ market on the Effective Date. The Option will become
exercisable as to one-quarter of the shares of Stock subject thereto on the
first anniversary of the date of grant, as to an additional one-quarter of such
shares on the second anniversary of the date of grant, as to an additional
one-quarter of such shares on the third anniversary of the date of grant and as
to an additional one-quarter of such shares on the fourth anniversary of the
date of grant. The Option will have a term of seven years (the "Option Term").
Upon the termination of Executive's employment:

                   (1)  by reason of death, the Executive's estate may exercise
the Option (to the extent exercisable at the time of death) until the earliest
of one year following the Executive's death or the end of the Option Term,
following which time the Option shall terminate and be no longer exercisable;

                   (2)  by reason of Disability (as such term is defined in
Section 4 below), the Option shall become fully and immediately exercisable and
the Executive (or, following his death, his estate) may exercise the Option
until the earlier of one year following the Date of Termination (as such term is
defined in Section 4 below) or the end of the Option Term, following which time
the Option shall terminate and be no longer exercisable;

                   (3)  by the Company for "cause" other than for Disability (as
each term is defined in Section 4 below), the Option shall terminate and no
longer be exercisable on the date the Executive is advised by the Board that he
is being terminated for cause;

                   (4)  by the Executive without "Good Reason" (as such term is
defined in Section 4 below), the Option, to the extent exercisable on the Date
of Termination, shall remain exercisable by the Executive (or, following his
death, his estate) until the earlier of 90 days following such date or the end
of the Option Term, following which time the Option shall terminate and be no
longer exercisable; or

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                   (5)  by the Company without Cause or by the Executive with
Good Reason, the entire Option shall become fully and immediately exercisable
and the Executive may exercise the Option until the earliest of one year
following the Executive's termination or the end of the Option Term, following
which time the Option shall terminate and be no longer exercisable.

                   The Executive shall be entitled to participate in other
Company stock option grants or other equity plans or programs, if any, in which
senior executives of the Company are eligible to participate generally
commensurate with his position as may be determined by the Compensation
Committee.

                   The Executive will be entitled to pay the exercise price of
the Option with shares of Stock previously acquired by the Executive and may
elect to have any withholding taxes required to be withheld as a result of the
exercise of the Option taken out of Stock issuable to the Executive as a result
of such exercise.

                   Other than as stated above, the Option will be governed by
the terms and conditions of the Company's Stock Option Plan and the standard
Stock Option Agreement thereunder to be executed by the Executive and the
Company.

                   (d)  Incentive, Savings and Retirement Plans. During the
Employment Term, the Executive shall be eligible to participate in all
incentive, savings and retirement plans, practices, policies and programs, if
any, that are applicable generally to other senior executives of the Company and
its affiliated companies. The Company intends to establish incentive, savings
and retirement plans that are comparable in level of benefits to such plans as
generally exist in the Company's industry.

                   (e)  Welfare Benefit Plans. During the Employment Term, the
Executive and/or the Executive's family, as the case may be, shall be eligible
for participation in and shall receive all benefits under welfare benefit plans,
practices, policies and programs provided by the Company and its affiliated
companies (including, without limitation, medical, prescription, dental,
disability, salary continuance, employee term life, group life, accidental death
and travel accident insurance plans and programs, if any) that are applicable
generally to other senior executives of the Company and its affiliated
companies. It is acknowledged that the Executive's level of participation in
these plans shall be consistent with an executive of his stature in the
Company's industry.

                   (f)  Expenses. During the Employment Term, the Company shall
pay or promptly reimburse the Executive for all reasonable business and
professional expenses upon presentation of receipts therefor in accordance with
the normal practices of the Company. It is acknowledged that the Executive will
incur expenses consistent with an executive of his stature in the Company's
industry and in connection with his membership and participation in bar
associations and other professional organizations.


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                   (g)  Fringe Benefits. During the Employment Term, the
Executive shall be entitled to fringe benefits appropriate to an executive of
Executive's stature in the Company's industry. Additionally, the Company shall
pay the Executive's reasonable legal fees for preparation and review of this
Employment Agreement, and shall reimburse the Executive, up to $7,500.00 per
year, for personal tax and financial planning services.

                   (h)  Vacation and Holidays. During the Employment Term, the
Executive shall be entitled to four weeks of paid vacation per year and all
other paid holidays given to employees of the Company.

              4.   Termination of Employment.

                   (a)  Cause. The Company may terminate the Executive's
employment during the Employment Period for Cause. For purposes of this
Agreement, "Cause" shall mean: (i) the conviction of, or pleading guilty to, a
felony or crime involving moral turpitude, (ii) the Executive's suspension or
disqualification from the practice of law in the State of New York, or (iii) the
willful failure of the Executive to perform, in any material respect, his
obligations under this Agreement after a written demand for such performance is
delivered to the Executive by the Board, which specifically identifies the
manner in which the Board or Chief Executive Officer believes that the Executive
has not performed the Executive's duties; or (iv) a disability that prohibits
the Executive from substantially meeting his responsibilities as a senior
executive of the Company on a full-time basis for 90 out of 120 consecutive
business days ("Disability").

                   For purposes of this provision, no act or failure to act, on
the part of the Executive shall be considered "willful" unless it is done, or
omitted to be done, by the Executive in bad faith or without reasonable belief
that the Executive's action or omission was in the best interests of the
Company. Any act, or failure to act, by the Executive based upon authority given
to the Executive pursuant to a resolution duly adopted by the Board or based
upon the advice of regular outside counsel for the Company shall be conclusively
presumed to be done, or omitted to be done, by the Executive in good faith and
in the best interests of the Company. Termination of the Executive's employment
for Cause shall be effective upon receipt of notice pursuant to Section 4(d).
For purposes of this provision, termination of the Executive's employment on
account of the Disability of the Executive shall be by written notice to the
Executive, effective 30 days after receipt thereof by the Executive, provided
that, within 30 days after such receipt, the Executive shall not have returned
to full-time performance of the Executive's duties.

                   (b)  Good Reason. The Executive's employment may be terminat-
ed by the Executive for Good Reason. For purposes of this Agreement, "Good
Reason" shall mean in each case, without the Executive's prior written consent:

                        (i)    the assignment to the Executive of any duties
                   materially inconsistent with the Executive's position
                   (including status, offices, titles and reporting
                   requirements), authority, duties or responsibilities as
                   contemplated by Section 2 of this Agreement, or any other
                   action by the

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                   Company which results in a diminution in such position,
                   authority, duties or responsibilities, excluding for this
                   purpose any action not taken in bad faith and which is
                   remedied by the Company within twenty (20) days after receipt
                   of notice thereof given by the Executive;

                        (ii)   any failure by the Company, in any material
                   respect, to comply with any of the compensation and benefits
                   provisions of Section 3 of this Agreement, other than failure
                   not occurring in bad faith and which is remedied by the
                   Company within twenty (20) days after receipt of notice
                   thereof given by the Executive;

                        (iii)  the Company's requiring the Executive to be based
                   at any office or location outside New York City;

                        (iv)   any failure by the Company to comply with and
                   satisfy any covenant or agreement contained in this
                   Agreement, excluding for this purpose any failure or omission
                   not occur-ring in bad faith or any action not taken in bad
                   faith and which is remedied by the Company within twenty (20)
                   days after receipt of notice thereof given by the Executive;
                   or

                        (v)    the occurrence of a "Change of Control", which 
                   shall be deemed to have occurred if (1) any "person" (as such
                   term is used in Sections 13(d) and 14(d) of the Securities
                   Exchange Act of 1934, as amended (the "Exchange Act")), other
                   than the Company, an employee benefit plan of the Company, or
                   any of the Company's direct or indirect affiliates
                   (hereinafter, a "Third Party"), is or becomes the "beneficial
                   owner" (as defined in Rule 13d-3 promulgated under the
                   Exchange Act), directly or indirectly, of the securities of
                   the Company representing 33% or more (on a fully-diluted
                   basis) of the combined voting power of the then outstanding
                   voting securities of the Company entitled to vote generally
                   in the election of directors of the Company or (ii) all or
                   substantially all of the assets of the Company are acquired
                   by a Third Party. All references in this Agreement to "Good
                   Reason" shall be deemed to include a reference to termination
                   upon a Change of Control.

                   (c)  Death. The Executive's employment shall terminate
automatically upon the Executive's death during the Employment Period.

                   (d)  Notice of Termination. Any termination by the Company
for Cause, or by the Executive for Good Reason, shall be communicated by Notice
of Termination to the other party hereto given in accordance with Section 13 (b)
of this Agreement. For purposes of this Agreement, a "Notice of Termination"
means a written notice which (i) indicates the specific termination provision in
this Agreement relied upon, (ii) to the extent applicable, sets forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination

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of the Executive's employment under the provision so indicated and (iii) if the
Date of Termination (as defined below) is other than the date of receipt of such
notice, specifies the termination date (which date shall be not more than thirty
days after the giving of such notice). The failure by the Executive or the
Company to set forth in the Notice of Termination any fact or circumstance which
contributes to a showing of Good Reason or Cause shall not waive any right of
the Executive or the Company, respectively, hereunder or preclude the Executive
or the Company, respectively, from asserting such fact or circumstance in
enforcing the Executive's or the Company's rights hereunder.

                   (e)  Date of Termination. "Date of Termination" means (i) if
the Executive's employment is terminated by the Company for Cause, or by the
Executive for Good Reason, the date of receipt of the Notice of Termination or
any later date specified therein, as the case may be (although such Date of
Termination shall retroactively cease to apply if the circumstances providing
the basis of termination for Cause or Good Reason are cured in accordance with
Section 4(a) or 4(b) of this Agreement, respectively), (ii) If the Executive's
employment is terminated by the Company other than for Cause, the Date of
Termination shall be the date on which the Company notifies the Executive of
such termination and (iii) if the Executive's employment is terminated by reason
of death, the Date of Termination shall be the date of death of the Executive.

              5.   Obligations of the Company Upon Termination. (a) Good Reason;
Other Than for Cause. If, during the Employment Term, the Company shall
terminate the Executive's employment other than for Cause or the Executive shall
terminate employment for Good Reason:

                        (i)    the Company shall pay to the Executive the 
                   aggregate of the following amounts:

                               A.   the sum of (1) the Executive's Annual Base
                        Salary through the Date of Termination to the extent not
                        theretofore paid, and (2) any compensation previously
                        deferred by the Executive (together with any accrued
                        interest or earnings thereon) and any accrued vacation
                        pay, and (3) any Annual Bonus for the fiscal year of the
                        Company terminating prior to the Date of Termination, in
                        each case to the extent not theretofore paid (the sum of
                        the amounts described in clauses (1), (2) and (3) shall
                        be hereinafter referred to as the "Accrued
                        Obligations"). All Accrued Obligations shall be paid in
                        a lump sum in cash within 30 days of the Date of
                        Termination; and

                               B.   an amount equal to (i) two times the Annual
                        Base Salary payable to the Executive under this
                        Agreement, at the annual rate in effect as of the
                        Termination Date as provided in Section 3(a), plus (ii)
                        two times the Target Bonus which would have been paid or
                        payable to Executive (assuming such Target

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                        Bonus had been earned), under Section 3(b) based upon
                        the Annual Base Salary which would have been in effect
                        as of the Termination Date, in each case to be paid in a
                        lump sum within 30 days after the Date of Termination.
                        The Executive shall have no duty or obligation to
                        mitigate the amounts or obligations provided in this
                        Section 5(a)(i), even in the event the Executive becomes
                        reemployed by another employer.

                        (ii)   all stock options, restricted stock and other
                   stock-based compensation shall become exercisable or vested
                   in the manner provided for Options in Section 3(c)(5) herein;

                        (iii)  for two years after the Executive's Date of
                   Termination, the Company shall continue benefits to the
                   Executive and/or the Executive's family at least equal to
                   those which would have been provided to them in accordance
                   with the plans, programs, practices and policies described in
                   Section 3(e) of this Agreement if the Executive's employment
                   had not been terminated, provided, however, that if the
                   Executive becomes reemployed with another employer and is
                   eligible to receive medical or other welfare benefits under
                   another employer provided plan, the corresponding medical and
                   other welfare benefits described herein shall be terminated.
                   Those welfare benefits not offered by the new employer shall
                   continue until termination of the above-described two-year
                   period. For purposes of determining eligibility (but not the
                   time of commencement of benefits) of the Executive for
                   retiree benefits pursuant to such plans, practices, programs
                   and policies, the Executive shall be considered to have
                   remained employed until the later of two years after the Date
                   of Termination or the end of the Employment Term and to have
                   retired on the last day of such period;

                        (iv)   to the extent not theretofore paid or provided, 
                   the Company shall timely pay or provide to the Executive any
                   other amounts or benefits required to be paid or provided to
                   the Executive or which the Executive is entitled to receive
                   under any plan, program, policy or practice or contract or
                   agreement of the Company and its affiliated companies, to the
                   extent payment of any such amounts or benefits are not
                   already provided for under this Agreement (such other amounts
                   and benefits shall be hereinafter referred to as the "Other
                   Benefits").

                   The Executive shall have the right to approve, such approval
not to be unreasonably withheld by the Company, any written announcement, if
any, of the termination of the Executive's employment with the Company.


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                   (b)  Death. If the Executive's employment is terminated by
reason of the Executive's death during the Employment Period, this Agreement
shall terminate without further obligations to the Executive's legal
representatives under this Agreement, other than for payment of Accrued
Obligations, the right to exercise the Executive's Stock Option under Section
3(c)(1) herein, and the timely payment or provision of Other Benefits. Accrued
Obligations shall be paid to the Executive's estate or beneficiary, as
applicable, in a lump sum in cash within 30 days of the Date of Termination.

                   (c)  Cause; Other Than for Good Reason. If, during the
Employment Term, the Executive's employment shall be terminated by the Company
for Cause or by the Executive without Good Reason, this Agreement shall
terminate without further obligations to the Executive other than the payment of
Accrued Obligations, and the payment or provision of Other Benefits. All Accrued
Obligations shall be paid to the Executive in a lump sum in cash within 30 days
of the Date of Termination. Upon a termination of the Executive's employment for
Cause by the Company or by the Executive without Good Reason, the Executive
shall forfeit all stock options that are not vested on the Date of Termination.
If the Executive's employment is terminated for Cause, nothing in this Agreement
shall prevent the Company from pursuing any other available remedies against the
Executive.

                   6.   Non-Exclusivity of Rights. Nothing in this Agreement 
shall prevent or limit the Executive's continuing or future participation in any
plan, program, policy or practice provided by the Company or any of its
affiliated companies and for which the Executive may qualify nor shall anything
herein limit or otherwise affect such rights as the Executive may have under any
contract or agreement with the Company or any of its affiliated companies.
Amounts which are vested benefits or which the Executive is otherwise entitled
to receive under any plan, policy, practice or program of or any contract or
agreement with the Company or any of its affiliated companies at or subsequent
to the Date of Termination shall be payable in accordance with such plan,
policy, practice or program or contract or agreement except as explicitly
modified by this Agreement.

                   7.   Full Settlement; Legal Fees. The Company's obligation to
make the payments provided for in this Agreement and otherwise to perform its
obligations hereunder shall not be affected by any set-off, counterclaim,
recoupment, defense or other claim, right or action which the Company may have
against the Executive or others.

                   8.   Certain Reductions. (a) Anything in this Agreement to 
the contrary notwithstanding, in the event it shall be determined that any
payment or distribution by the Company to or for the benefit of the Executive
(whether paid or payable or distributed or distributable pursuant to this
Agreement or otherwise, a "Payment") would be subject to the excise tax imposed
by Section 4999 of the Code (the "Excise Tax"), then the payments pursuant to
this Agreement shall be reduced to the extent that such reduction would result
in after-tax payments and benefits to the Executive that exceed the after-tax
payments and benefits to which the Executive would be entitled without such
reduction. In the event of any such reduction, the Executive shall be entitled
to designate the specific payments or benefits reduced.

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                   (b)  All determinations required to be made under this 
Section 8 shall be made by such certified public accounting firm as may be
designated by the Executive. Such accounting firm shall provide detailed
supporting calculations to either party hereto upon request therefore. All fees
and expenses of such accounting firm shall be borne solely by the Company. Any
determination by such accounting firm shall be binding upon the Company and the
Executive, and such parties agree not to take any position (in any tax return or
otherwise) inconsistent with such determination.

                   (c)  As a result of potential uncertainty in the application
of Section 4999 of the Code, it is possible that a payment will be made to
Executive which should not have been made. In the event of determination by the
IRS or a court that the Excise Tax applies to any Payment which is not
appealable or which the Executive chooses not to appeal, the Executive shall
return to the Company all or any portion of the payments or benefits provided
pursuant to this Agreement (without interest) that the Executive determines
would result in the Excise Tax ceasing to apply to any Payment.

                   9.   Confidential Information; Non-Solicitation.

                   (a)  The Executive shall hold in a fiduciary capacity for the
benefit of the Company all secret or confidential information, knowledge or data
relating to the Company or any of its affiliated companies, and their respective
businesses, which shall have been obtained by the Executive during the
Executive's employment by the Company or any of its affiliated companies and
which shall not be or become public knowledge (other than by acts by the
Executive or representatives of the Executive in violation of this Agreement).
After termination of the Executive's employment with the Company, the Executive
shall not, without the prior written consent of the Company or as may otherwise
be required by law or legal process, communicate or divulge any such
information, knowledge or data to anyone other than the Company and those
designated by it. In no event shall an asserted violation of the provisions of
this Section 9 constitute a basis for deferring or withholding any amounts
otherwise payable to the Executive under this Agreement.

                   (b)  For a period of one year following the termination of 
the Executive's employment for any reason, the Executive shall not, directly or
indirectly, employ or seek to employ any person who is at the Date of
Termination, or was at any time within the six month period preceding the Date
of Termination, an employee of the Company or any of its subsidiaries or
affiliates or otherwise cause or induce any employee of the Company or any of
its subsidiaries or affiliates to terminate such employee's employment with the
Company or such subsidiary or affiliate for the employment of another company
(included for this purpose the contracting with any person who was an
independent contractor of the Company during such period), without the prior
written consent of the Company's Board of Directors.

                   10.  Employment Renewal. At least six months prior to
expiration of the Employment Term, the Company and the Executive shall enter
into good-faith negotiations for a new employment agreement. If the Company
fails to offer the Executive a new agreement

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with terms no less favorable to Executive than those in effect at the scheduled
termination of this Agreement (i.e., May 6, 2002), or if such offer is
subsequently revoked, the Executive shall be entitled to the benefits described
in Section 5(a) hereof.

                   11.  Indemnification; Directors and Officers Insurance.
During the Employment Period and thereafter, the Company shall indemnify
Executive and hold Executive harmless from and against any claim, loss or cause
of action arising from or out of Executive's performance as an officer, director
or employee of the Company, or any of its respective subsidiaries or in any
other capacity, including any fiduciary capacity, in which Executive serves at
the request of the Company to the maximum extent permitted by applicable law.
The Company agrees to provide Executive with coverage under a directors and
officers liability insurance policy providing coverage at least equal to the
coverage provided by the Company to its other directors and officers.

                   12.  Successors.

                   (a)  This Agreement is personal to the Executive and without
the prior written consent of the Company shall not be assignable by the
Executive otherwise than by will or the laws of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by the Executive's
executors, successors and legal representatives.

                   (b)  This Agreement shall inure to the benefit of and be
binding upon the Company and its successors and assigns.

                   (c)  The Company will require any successor (whether direct 
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to assume
expressly in writing and agree to perform this Agreement in the same manner and
to the same extent that the Company would be required to perform it if no such
succession had taken place. Failure to do so shall constitute Good Reason for
the Executive to terminate his employment. As used in this Agreement, "Company"
shall mean the Company as hereinbefore defined and any successor to its business
and/or assets as aforesaid which assumes and agrees to perform this Agreement by
operation of law, or otherwise.

                   13.  Miscellaneous.

                   (a)  This Agreement shall be governed by and construed in
accordance with the laws of the State of New York, without reference to
principles of conflict of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect. This Agreement may not
be amended or modified otherwise than by a written agreement executed by the
parties hereto or their respective successors and legal representatives.


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                   (b)  All notices and other communications hereunder shall be
in writing and shall be given by hand delivery to the other party or by
registered or certified mail, return receipt requested, postage prepaid,
addressed as follows:

                        If to the Executive:

                        Mr. Philip Galanes
                        26 East 10th Street
                        #5-F
                        New York, New York 10003

                        If to the Company:
                        Golden Books Family Entertainment, Inc.
                        888 Seventh Avenue
                        New York, NY 10106
                        Attention: Senior Vice President, Human Resources

or to such other address as either party shall have furnished to the other in
writing in accordance herewith. Notice and communications shall be effective
when actually received by the addressee.

                   (c)  The invalidity or unenforceability of any provision of
this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement.

                   (d)  The Company may withhold from any amounts payable under
this Agreement such Federal, state, local or foreign taxes as shall be required
to be withheld pursuant to any applicable law or regulation.

                   (e)  The Executive's or the Company's failure to insist upon
strict compliance with any provision hereof or any other provision of this
Agreement or the failure to assert any right the Executive or the Company may
have hereunder, including, without limitation, the right of the Executive to
terminate employment for Good Reason pursuant to Section 4 (b) of this
Agreement, shall not be deemed to be a waiver of such provision or right or any
other provision or right of this Agreement.

                   (f)  This Agreement supersedes and replaces in its entirety
the Employment Agreement, dated as of October 9, 1996, between the Executive and
the Company; provided that the stock option grant to Executive set forth in
Paragraph 3(c) of such Employment Agreement shall survive.


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                   IN WITNESS WHEREOF, the Executive has hereunto set the
Executive's hand and, pursuant to the authorization from its Board of Directors,
the Company has caused these presents to be executed in its name on its behalf,
all as of the day and year first above written.


                             PHILIP GALANES


                                   /s/
                             ---------------------------------------------------


                             GOLDEN BOOKS FAMILY ENTERTAINMENT, INC.

                             By:  /s/
                             ---------------------------------------------------
                             Name: Michael Bruno
                             Title: SVP, Human Resources


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