DHB CAPITAL GROUP, INC.
                   P.O. BOX 269, OLD WESTBURY, NEW YORK 11568
                    PHONE (516) 997-1155 * FAX (516) 997-1144


                                                    October 11, 1996


The Lehigh Group, Inc.
810 7th Avenue, 37th Floor
New York, New York
Attention: Salvatore Zizza, President

Dear Sal:

                  The  Board  of  Directors  of  DHB  Capital  Group,  Inc.  has
authorized  me to notify you of the  termination  of the  Agreement  and Plan of
Reorganization entered into between us as of July 8, 1996.

                  We are taking this action  pursuant to  paragraph  17(a)(2) of
the Agreement in light of the recent  lawsuit filed against Lehigh by Southwicke
Corporation seeking to restrain or prohibit the transactions contemplated by the
Agreement and Plan of Reorganization.

                                           Very truly yours,

                                           DHB Capital Group, Inc.


                                           By: /S/ David H. Brooks
                                               ---------------------------