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                                                                   EXHIBIT 10.8

                                BROOKE GROUP LTD.
                       100 S.E. SECOND STREET, 32ND FLOOR
                                 MIAMI, FL 33131

                                  July 20, 1998

Mr. Bennett S. LeBow
5203 Fisher Island Drive
Fisher Island, FL 33109

Dear Mr. LeBow:

         This letter agreement sets forth the first amendment to the Employment
Agreement dated as of February 21, 1992 (the "Employment Agreement"), between
Brooke Group Ltd. and Bennett S. LeBow.

         1. The Employment Agreement is amended by deleting Sections 4(a) and
4(b) thereof and substituting therefor the following:

                (a)   BASE SALARY.

                During the Employment Period, the Company shall pay the
         Executive a salary (the "Base Salary") at the rate of $950,000 per
         annum. The Base Salary due the Executive hereunder shall be payable in
         accordance with the Company's normal payroll practices in equal
         installments less any amounts required to be withheld by the Company
         from such Base Salary pursuant to the benefit plans described in
         Section 3(e) hereof and the applicable laws and regulations described
         in Section 10(e) hereof. The Board shall periodically review such Base
         Salary and may increase it (but not decrease it below the Base Salary
         earned in 1994) from time to time, in its sole discretion. As of
         January 1, 1998, the Base Salary is $1,391,601.

                (b)   MINIMUM BONUS.

                During the Employment Period, the Company shall pay to the
         Executive a minimum annual bonus (the "Minimum Bonus") equal to 50% of
         his (then) current Base Salary, payable in accordance with the
         Company's normal payroll practices in equal installments, less any
         amounts required to be withheld by the Company from such Minimum Bonus
         pursuant to the applicable laws and regulations described in Section
         10(e) hereof.

         2. The Employment Agreement is amended by inserting the following as
the third sentence of Section 10(e):


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Mr. Bennett S. LeBow
July 20, 1998
Page 2


                Notwithstanding anything in this Agreement to the contrary,
         payments hereunder of salary, bonus or other payments shall be subject
         to those limitations, if any, contained in that certain Indenture,
         dated as of January 1, 1996, as it may be amended from time to time,
         between BGLS Inc. and State Street Bank and Trust Company (as successor
         to Fleet National Bank of Massachusetts), as Trustee, relating to the
         15.75% Senior Secured Notes due 2001, which limit or purport to limit
         the salary, bonus or other payments which may be made by the Company or
         any of its affiliates to the Executive or any of his affiliates.
         Payments due hereunder which are not made by virtue of such limitations
         shall be made at the earliest possible time in such a manner so as not
         to violate such limitations. To the extent any payment hereunder is
         made in violation of such limitations, the Executive shall hold the
         amount of such payment in trust for the Company and shall return it to
         the Company upon a final, non-appealable determination by a court of
         competent jurisdiction that the payment of such amount, if retained by
         the Executive, would violate such limitations.

         3. This letter agreement constitutes an amendment to and a modification
of the Employment Agreement and shall for all purposes be considered a part of
the Employment Agreement. Except as amended hereby, the Employment Agreement is
confirmed and ratified in all respects and shall remain in full force and
effect.

         Please indicate your agreement with the foregoing by countersigning two
copies of this letter agreement in the space provided below and returning one of
such copies to us.



                                            Very truly yours,


                                            BROOKE GROUP LTD.



                                            By: /s/ Richard J. Lampen
                                                -------------------------------
                                                Richard J. Lampen
                                                Executive Vice President


The foregoing letter agreement 
is consented and agreed to as 
of the date first above written.



By: /s/ Bennett S. LeBow          
    -----------------------------
    Bennett S. LeBow