SHARM EL-SHEIK, Egypt – With a verbal cease-fire deal in hand, Israeli and Palestinian leaders met at a Mideast summit Tuesday for face-to-face talks and goodwill gestures aimed at ending four years of violence and entering a new era of peace talks.

Israeli Prime Minister Ariel Sharon and Palestinian leder Mahmoud Abbas smiled broadly as they leaned across a long white table to shake hands as their meeting began — their first since Abbas succeeded Yasser Arafat after his November death. An invitation to both sides to meet separately with President Bush at the White House this spring added momentum on the summit’s eve.

“Israel is willing to go very far and we’re going to introduce today a package of confidence-building measures, incentives, to the Palestinians so that they could start this long journey on the road to peace,” said Ranaan Gissin, a top Sharon adviser. “But there’s one thing that must be made very clear … there will be no flexibility whatsoever, no compromise whatsoever on fighting terrorism.”

Sharon’s first meeting, with Egyptian President Hosni Mubarak (news – web sites), went long, lasting more than an hour. Gissin said Sharon planned to invite Mubarak for a visit to Israel. “One can expect that,” he said.

The cease-fire agreement to be announced later Tuesday will not be a formal written document, but instead a verbal declaration by each side to halt violence, said Gideon Meir, a senior official in the Israeli Foreign Ministry. An Egyptian official familiar with the deal confirmed that.

Abbas will declare an end to violence against Israelis, and Sharon will declare an end to Israeli military operations, Meir said.

In addition, Meir said that Israel will accept that in the short term the Palestinian Authority (news – web sites) will not actively crack down on militant groups. However, in the long term, that must be done because otherwise “the Palestinian terrorist organizations will have the ability to derail the peace process, hijack the peace process,” Meir said.

Another senior Israeli government official, speaking on condition of anonymity, made clear, however, that the halt to Israeli military operations still depended on a halt to Palestinian violence.

Possible prisoner releases also were on the agenda, but any negotiations toward a final peace deal must wait until later, said Palestinian negotiator Saeb Erekat. He called the summit a “beginning.”

And a Hamas spokesman in the Gaza Strip (news – web sites) struck a cautionary note, saying the radical Islamic group, which has been responsible for hundreds of attacks against Israelis over the past four years, would evaluate the summit before committing itself to halting its campaign of violence.

“We agreed before with Mahmoud Abbas that if he succeeds to achieve our national goals, he should come back to the Palestinian factions to discuss the issue, and after that we will decide our stand,” Mahmoud Zahar said.

Still, the verbal agreement was the clearest indication yet of momentum following Yasser Arafat’s death, the election of a new Palestinian leader and a signal from the White House that it plans a renewed push for peace.

In the hours before the summit began, the Israeli military said Palestinians opened fire on an Israeli military vehicle moving along the security fence surrounding the Gush Katif bloc of Jewish settlements in southern Gaza. No injuries or damage were reported. Israeli troops also arrested two Hamas members near the West Bank town of Jenin, the army said, adding that this arrest, like others in the past 10 days, was carried out with the specific approval of the army chief, Lt. Gen. Moshe Yaalon.

Israelis also briefly sealed off the West Bank town of Nablus, preventing Palestinians from leaving.

Sharon’s visit angered some Egyptians, and university students led by Islamic student groups demonstrated peacefully on their campuses Monday and Tuesday. At Cairo University, about 350 students burned Israeli and American flags and shouted against Sharon. One banner read: “Receiving Sharon is a shame on Egypt.”

Erekat said the agreement also included the establishment of joint committees — one to determine criteria for the release of Palestinian prisoners held in Israeli jails, and the other to oversee the gradual withdrawal of Israeli forces from Palestinian cities on the West Bank.

The senior Israeli official said that after Sharon’s declaration of an end to military operations, the two sides would go back to operating as they did before the 2000 outbreak of fighting: In Palestinian-controlled areas, including most of Gaza and eventually most West Bank towns, the Israelis would coordinate with Palestinian security forces if they wanted to arrest someone.

It was not clear what rules would apply in the towns that for now continue to be under Israeli security control — Jenin and Nablus.

Significant steps have been taken since Arafat’s death to reconcile Israel’s primary concern of security with Arabs’ main objective of getting the “road map” on the fast track.

Abbas has deployed police to keep the peace in Gaza, ordered arrests of some operatives and appears to have won pledges from militants to halt attacks on Israel.

On the Israeli side, the government is pledging to free 900 of the about 8,000 Palestinian prisoners it has in custody and gradually pull out of five Palestinian towns on the West Bank.

Egyptian Foreign Minister Ahmed Aboul Gheit, speaking Sunday during a visit to Damascus, said that if the summit generates enough goodwill, he hopes to see movement on the Syrian-Israeli front. Those peace talks stalled in January 2000.

The prisoner issue is one of the most emotionally charged issues expected to come up at the summit.

Securing a larger release would boost Abbas in his efforts to persuade militant factions to end the armed Palestinian uprising. Israel has balked at releasing prisoners involved in deadly attacks, but then signaled some flexibility when it agreed to set up a joint committee to review the possible release of inmates with “blood on their hands.”

Tied to that is the question of Palestinian fugitives wanted by Israel for attacks against Israelis. The Palestinians expect to receive a list of names of fugitives — about 350 people — who would be given conditional amnesty, provided they hand over their weapons and agree not to leave their hometowns.