MTLK Metalink, Ltd. (MM)

ABOUT METALINK

Metalink Ltd. (NASDAQ: MTLK) is a provider of high performance broadband
communication silicon solutions. Metalink's WLAN and DSL technologies are
designed to enable true broadband connectivity in every home, and its products
revolutionize the broadband experience by facilitating the convergence of
telecommunication, networking and entertainment.

Metalink's WLANPLUS(TM) is a high-throughput, 802.11n-draft-compliant wireless
LAN technology optimized for the networked home entertainment environment.
Featuring advanced MIMO technology and full support of QoS, and operating in
both 2.4GHz and 5GHz bands, WLANPLUS enables multi-room networking of multiple
high-definition video streams. In addition, Metalink offers a broad range of
symmetric DSL and VDSL products used by operators as a cost-effective network
upgrade to support triple-play services.

Further information is available at http://www.MTLK.com

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SAFE HARBOR STATEMENT

This press release contains "forward looking statements" within the meaning of
the United States securities laws. Words such as "aim," "expect," "estimate,"
"project," "forecast," "anticipate," "intend," "plan," "may," "will," "could,"
"should," "believe," "predicts," "potential," "continue," and similar
expressions are intended to identify such forward-looking statements. Because
such statements deal with future events, they are subject to various risks and
uncertainties that could cause actual results to differ materially from those in
the forward looking statements. Factors that could cause or contribute to such
differences include, but are not limited to: our need to raise additional funds
in order for us to implement our current business plan, including our liquidity
requirements, which funds may not be available to us; our inability to regain
compliance with Nasdaq's listing requirements; any unforeseen developmental or
technological difficulties with regard to our products; changes in the
competitive landscape, including new competitors or the impact of competitive
pricing and products; and the impact on revenues of economic and political
uncertainties and weaknesses in various regions of the world, including the
commencement or escalation of hostilities or acts of terrorism. Additional
factors that could cause actual results to differ materially from these
forward-looking statements are set forth from time to time in Metalink's filings
with the Securities and Exchange Commission, including Metalink's Annual Report
in Form F-20. Readers are cautioned not to place undue reliance on
forward-looking statements. Except as required by applicable law, the Company
undertakes no obligation to republish or revise forward-looking statements to
reflect events or circumstances after the date hereof or to reflect the
occurrences of unanticipated events. The Company cannot guarantee future
results, events, and levels of activity, performance, or achievements.

 AMENDMENT TO LOAN AGREEMENT

This Amendment to the Loan Agreement (this "AMENDMENT"), dated as of December
31, 2008, is made and entered into by Metalink Ltd., an Israeli corporation (the
"COMPANY"), and the Lender identified on the signature page hereto ("LENDER").

 WHEREAS the parties have entered into a certain Loan Agreement dated
 as of September 8, 2008 (the "LOAN AGREEMENT"); and

 WHEREAS the parties have agreed to amend the Loan Agreement upon the terms
 and conditions of this Amendment.

NOW, THEREFORE, THE PARTIES AGREE AS FOLLOWS:

 1. DEFINITIONS

 a. Capitalized terms not otherwise defined in this Amendment are
 used with the definitions assigned to them in the Loan Agreement.

 b. Except as amended hereby, the Loan Agreement shall remain in full
 force and effect. If this Amendment conflicts with the Loan
 Agreement, this Amendment shall prevail.

 2. ALLOCATION OF THE SECOND TRANCHE

 a. The Company hereby withdraws its request, dated as of December 4,
 2008 for the Second Closing in the amount of US$4,500,000.

 b. Notwithstanding anything to the contrary in the Loan Agreement,
 Lender agrees to provide the Company with the said US$4,500,000
 in two tranches as follows:

 i. US$2,250,000 no later than December 31, 2008 (the "FIRST
 PARTIAL TRANCHE");

 ii. At the request of the Company, made within 60 (sixty) days
 following a Triggering Event (as defined below),
 US$2,250,000 to be provided by Lender no later than five (5)
 days after the date of the Company's request, subject to
 Section 4 below (the "SECOND PARTIAL TRANCHE");

 3. THE WARRANTS

 The 2,200,000 warrants to be issued under the Loan Agreement upon the
 Second Closing shall instead be allocated between the First and Second
 Partial Tranches on a pro-rata basis, subject to provision of the
 corresponding sums.

 4. CONDITIONS FOR WITHDRAWAL OF THE SECOND PARTIAL TRANCHE

 a. Draw down (`withdrawal") of the Second Tranche will be dependent
 on the Company having reached any one of the following events on
 or before June 30, 2009 (the "TRIGGERING EVENT"):

 i. Receipt by the Company of a bona fide non binding term sheet
 from a bona fide third party with respect to a merger or
 acquisition agreement with proposed proceeds, whether paid
 to Company or directly to Lender, that are sufficient to
 repay the Company's full debt to the Lender (including the
 $3,500,000 loaned at the First Closing ("First Tranche") and
 the First and Second Partial Tranches). Such term sheet must
 provide for minimum proceeds of US$2,000,000 attributable to
 equity for all of Company's shareholders after repayment of
 all outstanding debt to Lender. For example, in the event
 that the Company opening debt balance to Lender is in the
 amount of US$5,750,000, said term sheet will include gross
 proceeds of at least US$7,750,000 for Metalink.

 ii. Drafting of a bona fide merger or acquisition agreement with
 terms that would provide for minimum proceeds of
 US$2,000,000 attributable to equity for all of Company's
 shareholders after repayment of all outstanding debt to
 Lender; or

 iii. The Company having signed an agreement of `no-shop' in
 connection with a term sheet complying with Section 4a.i
 above; or

 iv. Closing of any financing agreement that shall result in debt
 and/or equity capital raising of at least US$10,000,000 to
 the Company; proceeds of which are in fact used to repay the
 First Tranche and the first Partial Tranche.

 b. Notwithstanding anything to the contrary in the Loan Agreement,
 withdrawal of the Second Partial Tranche shall not be subject to
 satisfaction of the conditions set forth in Subsections 2.3(b)
 (iii), (vi) and (viii) of the Loan Agreement.

 5. WITHDRAWAL

 Following a Triggering Event, the Company shall have the right to
 withdraw the Second Partial Tranche in the full amount, at its sole
 discretion, during a 60 day time period following the Triggering
 Event, as set forth in Section 2.b.ii hereof.

 6. COVENANTS

 In the event that on or prior to June 30, 2009, both of the following
 conditions have occurred, the Company shall not be entitled to
 withdraw the Second Partial Tranche:

 i. None of the events described in section 4 above have taken
 place; and

 2

 ii. Company's total cash, cash equivalents, short and long term
 investments balance, are less than US$2,500,000 on either of
 the following dates (unless used for funding of working
 capital and their balance returns above US$2,500,000 within
 40 days):

 1. April 30, 2009; or

 2. May 31, 2009; or

 3. June 30, 2009;

 Then, the Lender shall be entitled to receive full repayment of
 the First Partial Tranche (in the sum of US$2.25M) within 20
 days.

 7. INVESTMENT BANK

 Company will engage an investment bank to manage and assist in an
 M&A process.

 8. OBSERVATION AND UPDATES

 a. Lender will receive an observer status in regard to the M&A
 process, and will be entitled to periodic updates on the status
 of the M&A process.

 b. Lender's obligations under the Non Disclosure Agreement dated as
 of December 15, 2008 shall continue as long as Lender is exposed
 to material non public information, including Lender's
 limitations on trading Company stock and safe-guarding non-public
 information received as part of such updates.

 9. ADDITIONAL FUNDING

 Company shall be entitled to raise additional funds in equity or debt
 transactions at any price, subject to adjusting Lender's warrants
 exercise price accordingly.



 10. EXECUTION DATE

 This Amendment shall come into effect upon the signature of the last
 signing party.

Metalink Ltd. Lender

By:__________________ By:__________________
Name: Tzvika Shukhman Name:
Title: CEO Title:

Date: December 31, 2008 Date:


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