<PAGE>

                                                                  Exhibit 4.(a)8

    Letter Agreement dated May 28, 2003, by and among the Registrant, Inovia
  Telecoms Limited, Lightscape Networks Limited, InnoWave ECI Wireless Systems
           Limited, ECI Telecom-NGTS Limited, Enavis Networks Limited,
                Bank Hapoalim B.M. and Bank Leumi Le-Israel B.M.


<PAGE>



================================================================================
[ECI TELECOM LOGO]
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To:    Bank Hapoalim B.M.
       41-45 Rothschild Boulevard
       Tel Aviv

       Attention: Doron Klausner

To:    Bank Leumi Le-Israel B.M.
       32 Yehuda Halevi Street
       Tel Aviv

       Attention: Dr. David Erlich

28 May, 2003

Dear Sirs

Facility Agreement dated 5 February, 2001 between, inter alia, ECI Telecom Ltd.,
Bank Leumi  Le-Israel  B.M.  ("BLL") and Bank Hapoalim B.M.  ("BP") (as amended)
(the "Facility Agreement")


1.   We refer to our recent  discussions  concerning:  (i) an  amendment  to the
     Facility Agreement; and (ii) outstanding short-term loans advanced to us by
     BP not pursuant to the Facility Agreement (the "Short Term Loans").

     Any  capitalised  term used but not defined  herein  shall bear the meaning
     ascribed to such term in the Facility Agreement.

     The following  sets out certain  agreements  between us which are operative
     immediately   either  as  amendments  to  the  Facility   Agreement  (where
     applicable) or otherwise, as well as the agreed principles of certain terms
     which,  as stated therein,  are intended  (together with other terms) to be
     reflected in an amended and restated  Facility  Agreement  ("the  Amendment
     Agreement"),  such  Amendment  Agreement to be the subject of  negotiations
     between us with a view to its  execution and closing on or prior to 30 June
     2003.  All terms  herein  which do not state that they are  conditional  on
     signature and closing of the Amendment Agreement are operative immediately.
     It is  intended  that  the  Amendment  Agreement  would  also  reflect  the
     amendments  of  the  Facility   Agreement  included  herein  and  operative
     immediately as aforesaid, but such amendments shall remain operative and in
     full force and effect, whether or not the Amendment Agreement is signed and
     closed  and  whether  or not  such  terms  are  reflected  in an  Amendment
     Agreement which is signed and closed (unless otherwise agreed therein).

2.   On May 29, 2003:

     (a)  we shall make a payment of  $38,166,672  (thirty  eight  million,  one
          hundred  and  sixty six  thousand,  six  hundred  and  seventy  two US
          Dollars) ($19,083,336 (nineteen million, eighty three thousand,  three
          hundred and


<PAGE>

          thirty  six US  Dollars)  to  each  of BLL  and  BP) in  repayment  of
          principal of the Loan such that the outstanding  principal of the Loan
          shall thereupon become  $100,000,000  (one hundred million US Dollars)
          ($50,000,000 (fifty million US Dollars) to each of BLL and BP);

     (b)  we shall make a payment of $13,000,000  (thirteen million US Dollars),
          being the outstanding  aggregate principal of the Short Term Loans and
          all  interest  accrued  thereon  in full and  final  repayment  of the
          outstanding Short Term Loans;

     (c)  in addition to the payment of  principal  pursuant to  paragraph  2(a)
          above,  we shall pay to BLL and BP the  interest  due on that  payment
          under the  Facility  Agreement  for the period up to May 29, 2003 (and
          not paid).

3.   (a)  On June 30, 2003, we shall repay such of the  outstanding  Loan at
          that time in order that the outstanding principal of the Loan shall be
          $60,000,000 (sixty million US Dollars) ($30,000,000 (thirty million US
          Dollars) to each of BLL and BP).

     (b)  Further, in addition to the payment of principal pursuant to paragraph
          3(a) above, we shall pay on June 30, 2003 the interest due on the Loan
          under the Facility Agreement on that date.

4.   Any  amounts  of the Loan  prepaid  hereunder,  shall be  applied  pro-rata
     against all future repayment  instalments due pursuant to clause 5.1 of the
     Facility  Agreement,  provided  that  upon  reduction  of  the  outstanding
     principal  of the  Loan  to  $60,000,000  (sixty  million  US  Dollars)  in
     accordance  with paragraph 3(a) above,  the balance of the principal of the
     Loan shall be paid in equal  instalments of $7,500,000  (seven million five
     hundred  thousand  US  Dollars),  at the  end  of  each  calendar  quarter,
     beginning  with the  calendar  quarter  ending on March 31, 2004 and ending
     with the calendar  quarter  ending on December  31,  2005.  It is expressly
     agreed,  for the removal of doubt,  that the aforegoing  provisions of this
     paragraph  4 shall  not  derogate  from the  rights of BLL and BP under the
     Facility Agreement.

5.   (a)  Subject to full payment by us of the amounts due under  paragraphs
          2 and 3 above, the following short term cash credit facilities,  under
          which any credit  granted  will be repayable by no later than one year
          from the date that the  outstanding  principal of the Loan was reduced
          to $60,000,000  (sixty million US Dollars)  (i.e.,  no later than June
          30, 2004) (unless extended by the relevant  lender),  will be provided
          to us:

          BP:  $15,000,000 (fifteen million US Dollars)

          BLL: $15,000, 000 (fifteen million US Dollars)

          provided that:

          (i)  the provision of the short term cash credit facilities by each of
               BLL and BP shall be subject to agreement  on the  specific  terms
               thereof between us and such bank; and



                                       2

<PAGE>


          (ii) the amount of the short term cash credit facility specified above
               with respect to BLL (if provided by BLL as  aforesaid)  ("the BLL
               Short Term Amount")  shall be reduced by the aggregate  amount of
               short term cash credit  facilities made available to us from time
               to time by any bank or  financial  institution,  other than BP or
               BLL  and we  shall  advise  BLL  promptly  upon  such  facilities
               becoming  available  to us, from time to time.  Accordingly,  for
               example, in the event that the First International Bank of Israel
               Ltd.  ("FIBI") provides us with a short term cash credit facility
               of  $10,000,000  (ten  million US Dollars)  (and there shall have
               been no previous  reduction in the BLL Short Term Amount),  then,
               without  derogating  from proviso (i) above,  the short term cash
               credit  facilities to be provided will be as follows  (instead of
               the amounts specified in this paragraph 5 above):

                            BP:      $15,000,000 (fifteen million US Dollars)

                            BLL:     $5,000,000 (five million US Dollars)

                            FIBI:    $10,000,000 (ten million US Dollars).

     (b)  Notwithstanding  the provisions of proviso (a)(ii) above,  but without
          derogating  from proviso (a)(i) above, in no event shall the BLL Short
          Term Amount be reduced to less than the amount of the FIBI  Prepayment
          (as that term is  defined  in  paragraph  7(d)  below) and if the FIBI
          Prepayment  shall be made  after the BLL Short  Term  Amount  has been
          reduced below the amount of the FIBI Prepayment,  then (subject to the
          one-year  limit  specified in paragraph 5(a) above) the BLL Short Term
          Amount shall be increased so as to be equal to the FIBI Prepayment.

     (c)  It is expressly  agreed,  for the removal of doubt,  that if BLL shall
          have  actually  advanced  funds to us within the framework of the said
          short  term  cash  credit  facility  and  another  bank  or  financial
          institution  subsequently  makes  short  term cash  credit  facilities
          available to us, we shall  immediately  repay to BLL the amount of the
          advance made by BLL to the extent necessary to achieve the appropriate
          reduction, as determined according to paragraphs (a) and (b) above.

     (d)  References in proviso  (a)(ii) of this  paragraph 5 and paragraph 5(c)
          above to  "short  term cash  credit  facilities"  shall  mean any cash
          credit  facilities other than those provided  pursuant to the Facility
          Agreement  (credit  provided by FIBI pursuant to paragraph  7(d) below
          being deemed facilities provided pursuant to the Facility Agreement).

6.   As security for:

     (a)  the short term cash  credit  facilities  to be provided by BLL, BP and
          FIBI (if  provided)  pursuant to  paragraph 5 above,  as extended  (if
          extended) by the relevant lender;

     (b)  the Loan advanced  pursuant to the Facility  Agreement (in addition to
          the securities already provided for the Loan); and



                                       3
<PAGE>


     (c)  all  outstanding  off-balance  sheet items provided by BP and BLL from
          time to time  (including  such  items  already  provided  on the  date
          hereof),

     we shall,  on signature  hereof,  create a floating charge in favour of The
     Bank Leumi Le-Israel Trust Company Ltd. ("the Trust Company") as Collateral
     Agent in the form of  Attachment  A hereto (the  "Floating  Charge").  Upon
     signature of the Floating Charge, the amount of $20,000 (twenty thousand US
     Dollars)  specified  in clause  10.8 of the  Facility  Agreement  is hereby
     increased to $22,000 (twenty-two thousand US Dollars). We understand that a
     new intercreditor  agreement ("the New Intercreditor  Agreement") will have
     to be entered into  between BP, BLL and the Trust  Company to deal with the
     Floating Charge and the rights of the creditors  secured under the Floating
     Charge.  The New  Intercreditor  Agreement shall not contain any provisions
     regarding,  inter alia, the status of additional  creditors entitled to the
     benefit of the  Floating  Charge  that  conflict  with  those  specifically
     provided for in this letter agreement.

     The  parties to the New  Intercreditor  Agreement  shall  agree a mechanism
     whereby a  creditor  will  release  its  interest  in the  Floating  Charge
     provided that all of the outstanding cash credit (long term and short term)
     owed to that  creditor  has been repaid and that the total value of the off
     balance sheet items issued by such creditor and  outstanding  do not exceed
     $10,000,000  (ten  million  US  Dollars),  provided  that we shall  provide
     alternative  securities  in the  form  of  pledged  cash  deposits  or bank
     guarantees  (from banks and in a form  acceptable to such creditor) or such
     other  securities to the full  satisfaction  of such creditor to secure the
     outstanding  off balance sheet items and provided  always that the creation
     by us of any  Encumbrance  (including  the pledging of cash deposits or the
     giving of such other  securities  as  aforesaid) in favour of such creditor
     shall  require the prior  written  consent of BLL and BP.  Should we create
     such Encumbrance in favour of BLL or BP, then only the consent of the other
     bank shall be required.  The provisions of this paragraph 6 do not derogate
     from the provisions of paragraph 8 below. For the purpose of this paragraph
     6, "off balance sheet items" or "off-balance  sheet  facilities" shall mean
     all banking  facilities other than cash credit  facilities and the value of
     such items or facilities  shall be determined  according to the exposure of
     the issuing bank in connection therewith, as determined by that bank.

7.   (a)  For the purpose of this  letter  agreement,  the term  "additional
          credit   facilities"   shall  mean  all  cash  credit  facilities  and
          off-balance  sheet  facilities  provided  other than  pursuant  to the
          Facility Agreement.

     (b)  Any bank (an "Additional  Lender") providing us with additional credit
          facilities of $8,000,000  (eight million US Dollars) or more, of which
          at least  $3,000,000  (three  million  US  Dollars)  is by way of cash
          credit  facilities,  may  (subject to  paragraph  7(c) below) take the
          benefit of the Floating Charge as security for such additional  credit
          facilities,  subject  to  such  bank  becoming  a  party  to  the  New
          Intercreditor  Agreement,  it being agreed that such additional credit
          facilities and cash credit  facilities  shall include such  facilities
          provided  prior  to the  Additional  Lender  becoming  a party  to the
          Floating Charge and still  outstanding at that time and it being noted
          that the only Additional Lender to date is FIBI.




                                       4
<PAGE>

     (c)  The New  Intercreditor  Agreement  will  provide,  inter alia,  that a
          creditor secured under the Floating Charge shall only be entitled to:

          (i)  benefit  from the  proceeds of any  enforcement  of the  Floating
               Charge if we shall at such time have  facilities  outstanding  in
               excess  of  $3,000,000  (three  million  US  Dollars)  from  such
               creditor  and the  other  relevant  terms and  conditions  of the
               Intercreditor Agreement shall have been fulfilled; and

          (ii) trigger  enforcement  of the Floating  Charge if we shall have at
               such time  facilities  outstanding in excess of $5,000,000  (five
               million US Dollars)  from such creditor or group of creditors and
               such  outstanding  facilities shall constitute or include either:
               (1) 331/3% of the total of the aggregate of the additional credit
               facilities  held by us at that  time  as  well as  331/3%  of the
               aggregate  cash  credit  facilities  included  in the  additional
               credit  facilities  held by us at that time; or (2) 331/3% of the
               aggregate of all credit facilities held by us at that time.

     (d)  In the event that FIBI  provides us, by no later than August 15, 2003,
          with new credit of $5,000,000  (five million US Dollars) or more, upon
          the same repayment terms as those provided in the Facility  Agreement,
          FIBI shall be entitled to share, on a pari passu basis, in the benefit
          of the security  interests created pursuant to the Facility  Agreement
          upon   becoming  a  party  to  the  Facility   Agreement  and  to  the
          intercreditor  agreement  currently  in force  between BLL, BP and the
          Trust Company and governing, inter alia, the realisation of securities
          relating to the Loan.  Upon FIBI providing  said new credit,  we shall
          pay such amount to BLL (as a prepayment  under the Facility  Agreement
          which shall be applied pro-rata to all future  Repayment  Installments
          payable thereunder) in prepayment of outstanding principal of the Loan
          owing to BLL ("the FIBI Prepayment").

8.   (a)  We shall be entitled to pledge cash deposits,  notwithstanding the
          terms  of the  Floating  Charge,  in order to  secure  buyers'  credit
          (including,  inter alia, interbank lines of credit) and discounting of
          receivables,  invoices,  bills or notes or of other similar  financial
          assets, provided that:

          (i)  the extent of the  security  for any such  transaction  shall not
               exceed  thirty per cent  (30%) of the value of such  transaction;
               and

          (ii) the aggregate  amount  secured by such  securities  pledged by us
               shall not exceed $12,000,000 (twelve million US Dollars).

     (b)  The parties agree that any party may request that the limit  specified
          in  subparagraph  (a)  (ii)  above  be  renegotiated  as  part  of the
          negotiations  relating to the Amendment Agreement.  If a revised limit
          is agreed, it shall be reflected in the Amendment Agreement.

     (c)  BLL and BP shall procure that the Collateral  Agent under the Floating
          Charge shall issue notices pursuant to clauses 1.1.3, 1.1.4 and 1.1.12
          of the Floating Charge as shall be  appropriate,  having regard to the
          provisions of the Facility Agreement,  the Security Documents and this
          letter  agreement,  upon our written request or the written request of
          BLL and BP. It is  understood  that the  Encumbrances  referred  to in
          paragraph  6 above and the  pledge  of cash  deposits  referred  to in
          paragraph 8(a) above are intended to be "Excluded Security  Interests"
          and the  liabilities  secured  thereby are  intended  to be  "Excluded
          Liabilities" for the purposes of the Floating  Charge.  On the written
          request  of  BLL or BP  from  time  to  time,  we  shall  furnish  the
          requesting  bank  with  documentation  and  information  necessary  to
          ascertain  that the pledge of cash


                                       5
<PAGE>

          deposits referred to in paragraph 8(a) above is in accordance with the
          provisions  and  limitations  specified in that  sub-paragraph.  It is
          understood  further  that the  Encumbrances  created  prior  hereto to
          secure our  liabilities  under the Facility  Agreement  are  "Excluded
          Security Interests" for the purposes of the Floating Charge.

9.   (a)  Upon  signature of this letter  agreement  the Facility  Agreement
          shall be deemed amended so as to reflect the  provisions  hereof which
          relate to the  subject-matter  of the Facility  Agreement  and are not
          conditional on the signature and/or closing of the Amendment Agreement
          and so that the Floating Charge shall constitute a "Security Document"
          and a "Finance  Document",  within the  meaning of those  terms in the
          Facility Agreement and all representations,  warranties,  undertakings
          and other  provisions of the Facility  Agreement  relating to Security
          Documents  and/or  Finance  Documents  shall  relate  to the  Floating
          Charge,  subject to any disclosures previously made in writing to BLL,
          BP or the Collateral Agent.

     (b)  Our obligations and undertakings hereunder shall be deemed obligations
          and  undertakings  given by us under the  Facility  Agreement  and any
          breach of any such obligation or undertaking shall constitute an Event
          of Default within the meaning of the term in the Facility Agreement.

10.  We  undertake  that  from the date of  signature  hereof , the  accumulated
     aggregate amount of all credit  facilities  provided to us by all banks and
     financial  institutions and outstanding shall not exceed  $250,000,000 (two
     hundred and fifty million US Dollars).

11.  In consideration  for our  undertakings  herein and subject to the full and
     timely payment of the amounts due pursuant to paragraphs 2 and 3 above, the
     Financial  Undertakings  shall be amended,  in their  entirety,  as follows
     (effective upon June 30, 2003 ):

     (a)  the ratio of Tangible Equity to Total Liabilities shall continue to be
          no less than 1:1;

     (b)  for the year 2003, there shall be no minimum requirement for the ratio
          of EBITDA to Debt Service;

     (c)  for the first,  second and third  quarters in the year 2004, the ratio
          of EBITDA to Debt Service shall be no less than 1:1,  1.1:1 and 1.15:1
          respectively.  For each  quarter  thereafter,  commencing  the  fourth
          quarter of the year 2004, the ratio of EBITDA to Debt Service shall be
          no less than 1.2:1;




                                       6
<PAGE>

     (d)  for the year 2003, there shall be no minimum requirement for the ratio
          of EBITDA to  Borrowings.  Thereafter,  on every  Ratio  Determination
          Date, the ratio of EBITDA to Borrowings shall be no less than 1:5;

     (e)  the ratio of Current  Assets to Current  Liabilities  shall be no less
          than 1.5:1;

     (f)  for the year  2003 and the  first  three  quarters  of 2004,  we shall
          maintain  a  positive  quarterly  cash flow (on an  accumulated  basis
          commencing 1 January 2003) from  operations,  provided that failure to
          do so during the year 2004 shall not  constitute  a default  under the
          Facility  Agreement,  if the  following  condition is fulfilled on the
          relevant Ratio Determination Date:

          The ratio of A:B shall be at least 1.7:1, where:

          A    is the total of cash, cash  equivalents,  short term investments,
               inventories and trade receivables; and

          B    is the total of short term credit (excluding  current maturity of
               long term debt from banks) plus trade payables;

     (g)  we shall at all times maintain cash balances (cash,  cash  equivalents
          and short term investments, but excluding pledged cash deposits (other
          than the cash deposit in the amount of $8,300,000 (Eight Million Three
          Hundred  Thousand  US  Dollars)  pledged in favour of BP to secure the
          Ji-tong transaction),  pledged cash equivalents and pledged short term
          investments)  at banks  and  financial  institutions  in an  aggregate
          amount of at least (i) $15,000,000  (fifteen  million US Dollars) plus
          the aggregate of all outstanding  cash credit  facilities owing by us,
          or  (ii)  150%  of  the  aggregate  of  all  outstanding  cash  credit
          facilities owing by us, whichever of (i) and (ii) is the lower.

     All  Financial  Undertakings  shall  be  inclusive  of us and all  entities
     included in our consolidated financial statements, except Ectel.

12.  It is intended  that the  Amendment  Agreement  (if signed)  will include a
     provision,  whereby BLL and BP shall each agree to make  available to us up
     to an additional  $15,000,000  (fifteen million US Dollars) as a supplement
     to the existing long term Loan, on the terms and conditions of the Facility
     Agreement,  provided that we and BLL and BP shall have reached an agreement
     on the terms and conditions of such additional  financing,  including,  but
     not limited to, the availability period and additional  financial covenants
     relating thereto and the Amendment Agreement,  including such agreement, is
     signed and closed. Such additional financing shall be repaid in instalments
     to be paid at the same time as the  scheduled  repayments  of the  existing
     long term Loan under the Facility Agreement.

13.  We shall  procure  that,  from 30 June  2003 , our  three  subsidiaries  in
     Germany, France and England do not:

     (a)  borrow from all banks and financial  institutions an aggregate  amount
          in excess of $5,000,000 (five million US Dollars)  (including  amounts
          already borrowed prior to that date) each (i.e., each subsidiary); or



                                       7
<PAGE>

          (Two) pledge  assets  securing  more than  $7,500,000 in the aggregate
          (seven million five hundred  thousand US Dollars)  (including  amounts
          already so secured by that date) (i.e.  taking the three  subsidiaries
          together).

          We confirm  that,  as of the date hereof,  the  subsidiaries  meet the
          limits  specified  in  (a)  and  (b)  above.  On 30  June,  2003,  and
          thereafter,  at your request from time to time,  we shall  provide you
          with written confirmation of the precise amounts of the borrowings and
          of the  value of the  assets  pledged  by the  subsidiaries,  so as to
          verify compliance with the limits specified in (a) and (b) above.

14.  Subject to the amendments of the Facility  Agreement  pursuant hereto,  the
     Facility Agreement as amended previously hereto shall remain valid, binding
     and in full force.

15.  Paragraphs  10, 11 and 13 of this letter  agreement  shall no longer  apply
     following  full and final  payment of all  amounts  due under the  Facility
     Agreement.

Yours faithfully

for and on behalf of
ECI Telecom Ltd.

Agreed.

for and on behalf of
Inovia Telecoms Limited

By: /s/ S. Gitlin
    -----------------------------

Title:
       --------------------------


for and on behalf of                            for and on behalf of
Lightscape Networks Limited                     Innowave ECI Wireless Systems
                                                Limited

By: /s/ S. Gitlin                               By: /s/ S. Gitlin
    ------------------------------                  ----------------------------
Title:                                          Title:
      ----------------------------                    --------------------------

for and on behalf of                            for and on behalf of
ECI Telecom-NGTS Limited                        Enavis Networks Limited

By: /s/ S. Gitlin                            By: /s/ S. Gitlin
    ------------------------------               ----------------------------

Title:                                          Title:
      ----------------------------                    --------------------------


Acknowledged and agreed


/s/ T. Cohen  /s/ A. Betar                      /s/ S. Zeitak  /s/ Danny Shapira
----------------------------------              --------------------------------
for and on behalf of                            for and on behalf of
Bank Hapoalim B.M.                              Bank Leumi Le-Israel B.M.


                                       8