FREMONT, Calif., August 22, 2003. Avanex has entered into an agreement to acquire certain assets of Vitesse Semiconductor Corporation's Optical Systems Division located in San Jose, Calif. Under the terms of the agreement, Avanex will acquire substantially all of the assets of Vitesse's Optical Systems Division in exchange for approximately 1.2 million shares of Avanex common stock. Based on the closing price of Avanex's stock on August 19, 2003, the transaction has a value of approximately $6 million. Under the terms of the agreement, Avanex will also buy up to $2 million in products from Vitesse over the next three years. The completion of the transaction is subject to customary closing conditions. Walter Alessandrini, Chairman, President and Chief Executive Officer of Avanex, noted, "The acquisition of this business will enhance our already strong presence in transponders and expand our customer traction in subsystem products.