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                                                                 Exhibit: 10.7FT


                        FUTECH EDUCATIONAL PRODUCTS, INC.
                               EMPLOYMENT CONTRACT

                          DATED AS OF FEBRUARY 1, 1997

The following sets forth the agreement by and between Joseph K. Petter
("Employee") and Futech Educational Products, Inc., an Arizona corporation
("Futech"), as to the employment of the Employee by Futech.

1. POSITIONS AND DUTIES. Futech shall employ Employee and Employee shall accept
employment from Futech, during the term of this Agreement, upon the terms and
subject to the conditions set forth below. Employee's duties as Chief Operating
Officer shall be subject to the direction and control of Futech's Chairman and
Chief Executive Officer, Vincent W. Goett or his designee.

2. ACTIVITIES RELATING TO THE CORPORATION'S BUSINESS. At all times during the
term of this Agreement, the Employee shall devote his full energies, interest,
abilities and productive time to the performance of this duties and
responsibilities hereunder. During the term of this Agreement, and for a period
of two (2) years thereafter, Employee shall not, without the prior written
consent of Futech, which consent may be withheld for any or no reason, directly
or indirectly, owned, managed, operate, control, be employed by, participate in,
render services to, make loans to, or be connected in any manner with the
ownership, management, operation, or control of any business located in the
United States, or any other foreign country in which Futech does business or
intends to do business, which business conducts business the same or
substantially similar to any type of business ever conducted by Futech or
proposed to be carried on by Futech.

     In the event of any actual or threatened breach of the provisions of this
Section, Futech shall be entitled to an injunction restraining the actual or
threatened breach. The parties further agree that should Employee violate the
provisions of this Section, Employee shall be liable to Futech for, in addition
to any amounts pursuant to other remedies available against Employee, two (2)
times the greater of the amount of profit earned by Employee as a result of the
violation and the amount of profit which would have been earned by Futech from
the activities causing the violation had Futech conducted said activities, plus
interest on said greater amount calculated at eighteen percent (18%) per annum
from the date of the violating activities until paid, as liquidated damages for
only Futech's loss of potential profits. Nothing in this Section shall be
construed as prohibiting Futech from pursuing any other available remedies for
such breach or threatened breach, including pursuing a recovery for damages.

     Employee shall not, during the term of this Agreement and for a period of
two (2) years thereafter, without the prior written consent of Futech, which
consent may be withheld for any reason, directly or indirectly induce, encourage
or solicit or assist any person who was or is employed (whether as employee or
as independent contractor) by Futech during the time period described above in
this sentence to leave Futech's employ. If Employee has any control over, or
responsibility with respect to, the hiring of employees, agents or consultants
at any facility or with any other employer, Employee shall do everything in
Employee's power to preclude the
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hiring of or retention by such other employer or facility of any individual who
was employed by Futech during the period of time described in the beginning of
the proceeding sentence.

     Employee acknowledges and agrees that the restrictions contained in this
Agreement, including but not limited to time period and geographical area
restrictions, are fair and reasonable and necessary for the successful operation
of Futech, that violation of any of them would cause irreparable injury, and
that the restrictions contained herein are not unreasonably restrictive of
Employee's ability to earn a living. If the scope of any restriction in this
Section is too broad to permit enforcement of such restriction to its fullest
extent, then such restriction shall be enforced to the maximum extent permitted
by law, and all parties hereto consent and agree that such scope may be modified
judicially or by arbitration in any proceeding brought to enforce such
restriction. Employee acknowledges and agrees that remedies at law for any
breach or violation of the provisions of this Section would alone be inadequate,
and agrees and consents that temporary and permanent injunctive relief may be
granted in connection with such violations, without the necessity of proof of
actual damage, and such remedies shall be in addition to other remedies and
rights Futech may have at law or in equity. Employee agrees that Futech shall
not be required to give notice or post any bond in connection with applying for
or obtaining any such injunctive relief.

     The parties acknowledge and agree that the covenants in this Section shall
be construed as an agreement independent of any other provision of this
Agreement so that the existence of any claim or cause of action by Employee
against Futech, whether predicated on this Section or otherwise, shall not
constitute a defense to the enforcement of this Section.

3.   CONFIDENTIALITY AGREEMENTS. The obligations of the Employee and the rights
of Futech set forth herein are in addition to those set forth in a certain
Employee Confidentiality Agreement executed by the Employee (the
"Confidentiality Agreement").

4.   REPRESENTATIONS AND WARRANTIES. Employee represents and warrants to and
covenants with Futech, that (a) he has furnished to Futech a true and correct
copy of any agreements with any prior employer in the securities industry and is
subject to no contractual or other restriction or obligation which is
inconsistent with the execution of this letter agreement, the performance of his
duties hereunder, or any rights of Futech hereunder or under the Confidentiality
Agreement, (b) upon information and belief, there are no regulatory,
self-regulatory, administrative, civil or criminal matters past or present,
affecting the employment of Employee by Futech.

5.   SALARY. Employee will receive a salary of no less than $125,000 for the
first year of employment and no less than $175,000 per year for the second
through fifth years of employment. Such salary shall be payable in equal
periodic installments in accordance with Futech's usual practice, but not less
frequently than twice monthly, and shall be subject to payroll and withholding
deductions as may be required by law.

     Futech may defer Employee's compensation for the first six (6) months of
this

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Agreement, other than $4,000.00 per month (net, excluding all applicable Federal
and State taxes, Social Security and Medicare) which shall not be deferred.
After said six (6) months, the deferred amount shall be paid to Employee.

6. BENEFITS. During the term of his employment, Employee shall be eligible to
participate in, subject to their respective terms, all Futech employee (i) group
medical, hospitalization and life insurance plans, (ii) pension and profit
sharing plans, and (iii) other benefit plans or programs. Futech shall pay or
reimburse Employee for all out-of-pocket expenses for travel, meals, hotel
accommodations and the like reasonably incurred by him in accordance with
Futech's policies and directives (including any required prior approvals) for
such expenses in connection with the performance of Futech's business, each such
payment for reimbursement to be made upon submission of a statement and evidence
documenting such expenses as required by Futech. During the term of this letter
agreement, Employee shall be entitled to an annual paid vacation of such period
as may be established from time to time by Futech for its managerial employees
generally (other than its President, C.E.O., and/or Chairman).

7. TERM. The term of this letter agreement shall commence on February 1, 1997
and shall continue in effect as to Employee until January 2002, or until
such time as terminated as provided in paragraph 8, 9, 10 and 11. Upon
termination of this agreement pursuant to paragraph 8 or 9, Futech's sole
obligation to Employee shall be to pay all salary and stock options, if any,
accrued by him up to the date of such termination. Upon termination of this
agreement, Employee's obligations under the Confidentiality Agreement shall
survive.

8. TERMINATION UPON DEATH. In the event of the death of Employee, the employment
of, and this agreement with respect to, such deceased Employee shall be
terminated; provided always that Futech shall pay any accrued salary and any
accrued stock options, if any, as of the date of termination to the legal
representative of his estate.

9. TERMINATION FOR DISABILITY. Futech may terminate the employment of, and this
Agreement with respect to, Employee who becomes disabled, including disability
by reason of any emotional or mental disorders, physical diseases or injuries,
and as a result of such disability is unable to work on a full-time basis for a
continuous period of two months or more or any two months in a twenty four month
period. Upon such termination, Futech shall have no further liability to such
disabled Employee hereunder, except to pay any accrued salary and accrued stock
options, if any, as of the termination date. Upon such termination, such
disabled Employee's obligation to Futech under the Confidentiality Agreement
shall survive.

10. TERMINATION OF CAUSE. Futech may terminate the employment of, and this
agreement with respect to, Employee if (a) such Employee breaches his fiduciary
duties to Futech or is guilty of fraud or willful malfeasance, (b) such Employee
materially breaches any representation, warranty, covenant or agreement
contained in this agreement or fails to perform any of the obligations under
this agreement or duties assigned to him pursuant to his agreement or otherwise
by Futech, (c) if Employee materially misrepresents any statement to Futech, (d)
such Employee is convicted of a crime involving moral turpitude or a felony, (e)
such Employee

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knowingly commits a material violation of any law, rule, regulation or by-law of
a securities exchange or association or other regulatory or self-regulatory body
or agency applicable to any general policy or directive of Futech communicated
in writing to such Employee, (f) such Employee fails to follow reasonable
instructions and/or policies of Futech's Chairman of the Board and Chief
Executive Officer, or (g) such Employee terminates this Agreement at any time.

         Upon termination of this letter agreement pursuant to this paragraph
10, Futech's sole obligation to Employee shall be to pay all accrued salary.
However, this shall not affect Employee's vested benefits under paragraph 6.

         Upon such termination, Employee's obligation to Futech under the
Confidentiality Agreement shall survive.

11. TERMINATION OTHER THAN FOR CAUSE. Futech retains the right to terminate this
agreement and/or Employee's employment for cause as set forth in paragraph 10,
and notwithstanding anything to the contrary in this letter agreement Futech
shall have the right to terminate this agreement and/or Employee's employment
hereunder at any time for any reason other than for cause. In such event Futech
shall pay to Employee all salary as it accrued during the term of the contract,
subject, however, to Employee's obligation to look for and obtain suitable
employment. Employee's obligation to Futech under the Confidentiality Agreement
shall survive.

         Employee shall provide Futech at least thirty (30) days notice of
Employee's termination of his employment with Futech.

12. REVIEW. On August 1, 1997 and on each of the subsequent six month periods
thereafter during the term of employment, Vincent W. Goett shall provide
Employee with an informal verbal review of the Employee's performance.
Concurrent with the eighth semi-annual verbal review of performance, Vincent W.
Goett and Employee shall discuss the potential for Employee's continued
employment subsequent to the termination of this Agreement. Futech makes no
promises and has no obligation to so continue Employee's employment.

13. SUCCESSORS AND ASSIGNS. The rights and obligations of Futech hereunder shall
inure to the benefit of and shall be binding upon the successors and assigns of
Futech; provided, however, that Futech's obligations or liabilities hereunder
may not be assigned without the prior written approval of Employee, except to an
affiliate of Futech (which assignment shall not release Futech from its
obligations to Employee hereunder) or to a successor to all or substantially all
of Futech's assets, business or stock that agrees to be bound hereby. This
letter agreement is personal to the Employee and may not be assigned.

14. AMENDMENT OR WAIVER. This letter agreement may not be amended or modified
except by an agreement in writing duly executed by the Chairman and Chief
Executive Officer of Futech and the Employee. The failure of Futech, on the one
hand, or the Employee, on the other hand, at any time to enforce performance by
the other of any provision of this letter

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agreement shall in no way affect Futech's or the Employee's, as the case may be,
rights thereafter to enforce the same, nor shall the waiver by Futech, on the
one hand, or the Employee, on the other hand, of any breach of any provision
hereof be deeded to be a waiver by Futech or the Employee, as the case may be,
of any other breach of the same or any other provision hereof.

15. ARBITRATION. Except as set forth in the Confidentiality Agreement, any
controversy or claim arising out of or relating to this letter agreement, or the
breach hereof, shall be settled by arbitration in accordance with the rules of
the American Arbitration Association. Judgment upon the award of the
arbitrator(s) may be entered in any court having jurisdiction thereof.

16. MISCELLANEOUS. The invalidity or unenforceability of any provision of this
letter agreement shall not affect the validity or enforceability of any other
provision hereof. This letter agreement shall be constructed, interpreted and
enforced in accordance with the laws of the State of Arizona. This letter
agreement contains all of the terms and conditions agreed to by the parties
hereto with respect to the subject matter hereof and supersedes all prior
agreements, understandings, negotiations and discussions, whether oral or
written, of the parties, except those set forth in the Confidentiality
Agreement.


                                             FOREGOING AGREED TO:

                                             By: /s/ Joseph K. Petter
                                                 ------------------------
                                                 Joseph K. Petter


                                             BY: Futech Educational Products,
                                                 Inc., an Arizona corporation


                                             By /s/  Vincent W. Goett
                                                 ------------------------
                                                Vincent W. Goett, Chairman
                                                Chief Executive Officer

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