CONVERTIBLE NOTE PURCHASE AGREEMENT



                                   AMONG



                         GILAT COMMUNICATIONS LTD.



                                    AND



                   SHAMROCK HOLDINGS OF CALIFORNIA, INC.











                         Dated as of June 30, 2000





<PAGE>





          THIS CONVERTIBLE NOTE PURCHASE AGREEMENT, dated as of June 30,

2000 (this "Agreement"), is made among Gilat Communications Ltd., an

Israeli public company with its Ordinary Shares listed on Nasdaq (the

"Company") and Shamrock Holdings of California, Inc., a California

corporation ("SHI", and, together with its permitted transferees and

assigns, collectively referred to as the "Purchasers").



          WHEREAS, upon the terms and subject to the conditions set forth

in this Agreement, the Purchasers wish to purchase from the Company, and

the Company wishes to issue and sell to the Purchasers, 7% Convertible

Notes due 2004 (together with any additional notes issued pursuant to the

terms thereof, the "Notes") in the aggregate principal Face Amount of $25

million;



          WHEREAS, the Notes shall be convertible (under the circumstances

described herein) into of the Company's Ordinary Shares NIS 0.01 par value

per share (the "Ordinary Shares"); and



          WHEREAS, the Purchasers and the Company desire to provide for

such purchase and sale and to establish various rights and obligations in

connection therewith.



          NOW, THEREFORE, in consideration of the premises and the mutual

representations, warranties and agreements herein set forth, the parties

hereto agree as follows:



     1.   Issuance and Sale of Notes.

          --------------------------



          1.1. Definitions. Certain capitalized terms used in the Agreement

are defined in Section 6.1 hereof; references to a "Schedule" or an

"Exhibit" are, unless otherwise specified, to a Schedule or an Exhibit

attached to this Agreement.



          1.2. Issuance, Purchase and Sale. Upon the terms and subject to

the conditions set forth herein, the Company is issuing and selling to the

Purchasers, and the Purchasers are purchasing from the Company, the Notes

for an aggregate cash purchase price of $25 million (the "Purchase Price").

The Notes shall be in the form of Exhibit 1.2.



          1.3. Closing. The closing of the transactions contemplated hereby

(the "Closing") will take place simultaneously with the execution hereof at

the offices of Fried, Frank, Harris, Shriver and Jacobson, New York, New

York.



          1.4. Deliveries by the Company. At the Closing, the Company is

delivering to each Purchaser (and to such other parties as otherwise set

forth below) the following:



               (i) duly executed Notes in the principal amount in the

          Purchaser's name;



               (ii) an opinion of Arnold & Porter, the Company's U.S. legal

          counsel; an opinion of Kleinhendler & Halevy, the Company's

          Israeli legal counsel, and addressed to the Purchaser, in the

          forms of Exhibit 1.4ii(a) and 1.4ii(b);



               (iii) an Officers' Certificate in the form attached herewith

          as Exhibit 1.4iii, dated as of the date hereof, certifying that

          (A) the representations and warranties contained in Section 2

          hereof are true and correct in all respects (B) all necessary

          waivers, consents and approvals to or of the transactions

          contemplated by this Agreement shall have been obtained,

          including, without limitation, approval from the Israeli

          Investment Center; and (C) the transactions contemplated hereby

          have been approved and adopted by the requisite vote of board of

          directors of the Company in accordance with applicable Law, the

          applicable rules of NASDAQ and the Company's Articles of

          Association and Memorandum of Association,



               (iv) a copy of the minutes or resolutions of the Board of

          Directors in the form attached herewith as Exhibit 1.4iv (i)

          adopting the execution of each of the Transaction Documents and

          the performance of the transactions contemplated by the

          Transaction Documents, and (ii) the appointment of an individual

          designated by the Purchasers to the Board of Directors, if so

          requested by the Purchasers prior to the date hereof, which

          minutes or resolutions shall be certified by the Company's

          Chairman of the Board of Directors or the Company's Secretary as

          true, correct and effective as of the date hereof;



               (v) a duly executed copy of the Registration Rights

          Agreement attached as Exhibit 1.4v;



               (vi) payment of a funding fee of $325,000 to an account

          designated by Shamrock Capital Advisors, Inc., financial adviser

          to the Purchaser; and

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