Award sponsored by Thai-Canadian Chamber of Commerce

San Francisco, CA – July 25, 2007 – RED-C Optical Networks Ltd. (RED-C), a leading provider of integrated optical subsystems based on state-of-the-art optical amplification technology, and Fabrinet, a provider of advanced manufacturing services, today announced the execution of a strategic supply agreement, according to which RED-C has selected Fabrinet as its contract manufacturing partner for full turnkey production services. RED-C's production site at Fabrinet is expected to be fully operational by the beginning of 2008. The site is designated for high volume production and will be gradually expanded as per RED-C needs.

Parallel with the establishment of a production site with Fabrinet, RED-C plans to further expand its in-house production facilities at its Tel Aviv factory. The dual manufacturing presence will allow RED-C enhanced flexibility in meeting increasing customer demands and complete redundancy between the two sites, resulting in an industry-leading Disaster Recovery Plan. It will also keep RED-C's R&D and engineering teams close to the manufacturing activities, allowing continuous feedback, which is an essential element in RED-C's top-quality policy.

Yossi Boker, RED-C president and CEO commented: "This strategic supply agreement with Fabrinet is an important milestone in RED-C's rapid growth and its roadmap to becoming a leading global supplier. It adds to several key agreements executed recently with strategic partners, which are cementing RED-C's position as an emerging player in the industry. We are confident that Fabrinet's capabilities and professionalism will play an important role in RED-C's growth strategy."

Tom Mitchell, president and CEO of Fabrinet commented: "We are highly impressed with RED-C's achievements and pleased to have been selected as a contract manufacturing partner by such a technology leader. We're confident that our expertise in optical manufacturing will materially contribute to RED-C's business success as we move forward into providing more complex system level solutions to our customers."

About RED-C

RED-C Optical Networks Ltd. is a leading provider of integrated optical subsystems based on state-of-the-art optical amplification technology. RED-C's product line is comprised of a broad range of EDFAs, Raman amplifier modules, integrated subsystems and network elements. RED-C's integrated platform enables to incorporate the entire range of its optical amplifiers with complementary optical devices into synchronized, interconnected, cost-effective subsystems. For more information, see www.red-c.com.

About Fabrinet

Fabrinet provides foundry services to optical component, module, and subsystem OEMs. Fabrinet also designs, manufactures and sells bulk optical materials and components, including glass, crystals, prisms, lenses, laser components and substrates. Fabrinet has engineering resources and facilities in Thailand, China and the United States. For more information visit: www.fabrinet.com.

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