Document:

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                                                                    EXHIBIT 10.8

NOTE: Information in this document marked with an "[*]" has been omitted and
filed separately with the Commission. Confidential treatment has been requested
with respect to the omitted portions.

                            FRAME PURCHASE AGREEMENT

                         FOR OPTO ELECTRONIC COMPONENTS

                                     BETWEEN

                               AVANEX CORPORATION

                                       AND

                                     ALCATEL

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This Agreement is made the 31st day of July 2003, between:

AVANEX CORPORATION, a Delaware corporation having a place of business at 40919
Encyclopedia Circle, Fremont, California 94538, United States of America,
(hereinafter referred to as "Supplier").

and

ALCATEL, a French Company organized and existing under the laws of France,
having its registered office 54 rue La Boetie 75008 Paris France, (hereinafter
"Alcatel") acting on behalf of its controlled companies as defined by Article L
233-1 of the French "Code de Commerce", (hereinafter the "Buyer") represented by
acting as;

WITNESSETH:

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CONTENTS.

1.       Definitions.

2.       Scope.

3.       Purchase Orders - Logistic - Minimum Quantities.

4.       Place - Date of Delivery.

5.       Risk.

6.       Price and Payment terms

7.       Acceptance And Rejection.

8.       Warranty.

9.       Reporting And Reviews.

10.      Quality

11.      Environmental requirements

12.      Support.

13.      Manufacturing Change.

14.      Intellectual Property.

15       Liability.

16.      Insurance.

17.      Term And Termination.

18.      Force Majeure.

19.      Invalidity.

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20.      Waiver.

21.      Survival Of Obligations.

22.      Entire Agreement - Amendments.

23.      Assignment.

24.      Subcontractors.

25.      Headings.

26.      Hierarchy of documents.

27.      Notices.

28.      Confidentiality.

29.      Applicable Law

30.      Business Practices

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WHEREAS

a.       Supplier is experienced in the manufacture and supply of Opto
         Electronic Components suitable for application in the manufacture of
         terrestrial and submarine telecommunication systems equipment.

b.       Buyer which is a major manufacturer in terrestrial and submarine
         telecommunication systems equipment desires to purchase Opto Electronic
         Components.

c.       Supplier and Buyer are mutually desirous of entering into this Frame
         Agreement for the supply of such Opto Electronic Components
         (hereinafter referred to as "Products") by Supplier to Buyer, on the
         following terms and conditions of trade and upon Purchase Orders.

NOW IT IS HEREBY AGREED AS FOLLOWS:

1.       DEFINITIONS. Except as otherwise defined below, initially capitalized
         terms used herein shall have the definitions assigned to such terms in
         the Share Acquisition and Asset Purchase Agreement or the Supply
         Agreement in connection with which this Agreement is entered into by
         and between the Parties.

1.1      "Agreement" shall mean this Frame Purchase Agreement and its Exhibits.

1.2      "Delivery" shall mean delivery in accordance with this Agreement.

1.3      "Party" shall mean either Supplier or Buyer.

1.4      "Product" includes the components, standard and custom listed in
         Exhibit A1 for terrestrial and A2 for submarine in volume production.
         The products under development are excluded from the scope of this
         Agreement.

1.5      "Purchase Order" shall mean a Purchase Order from Buyer with reference
         to this Agreement or a Purchase Order placed by a Contract Manufacturer
         (CM) or a LSP Logistic Service Provider (LSP) in each case as requested
         by buyer.

1.6      " Day" shall mean calendar day.

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1.7      "Buyer" shall mean any controlled companies of Alcatel as defined in
         article L 233-1 of the French "Code de Commerce" as well as their
         contract manufacturers (CM) and / or Logistics Service Providers (LSP)
         which have accepted in writing to abide by the terms and conditions of
         this Agreement, including but not limited to payment and
         confidentiality obligations.

2.       SCOPE.

2.1      Supplier hereby agrees to the supply and Buyer agrees to the purchase
         of Products, such supply to be on the terms and conditions hereinafter
         set forth, for Submarine components, the provision attached in exhibit
         D shall have precedent over the terms & conditions of this Agreement.
         Supply of Products shall be by way of Purchase Orders placed by Buyer
         upon Supplier.

2.2      Products may only be delivered against Purchase Orders issued by Buyer
         or its CMs or LSPs as indicated by Buyer. Purchase Orders shall be
         placed in writing by either printed Purchase Order or letter and either
         posted or transmitted by facsimile, or both, or by EDI when mutually
         agreed.

3.       PURCHASE ORDERS - LOGISTIC - MINIMUM QUANTITIES

3.1      Purchase Orders

The Purchase Orders will be confirmed by Supplier [*] ([*]) business days after
the receipt of the Purchase Order for standard Products and not later than [*]
([*]) days for custom Products; provided that supplier's failure to confirm any
such Purchase Order within the forgoing time periods shall be deemed Supplier's
acceptance of the relevant Purchase Order.

3.2      Logistics

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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         3.2.1. Supplier and Buyer will agree to put in place collaborative
         forecasting and communication programs in order to meet Buyer's
         flexibility requirements and Supplier's visibility needs as well as to
         reduce delivery lead times.

         3.2.2 Unless otherwise agreed between Supplier and Buyer, Buyer shall
         have the option of implementing either Option 1 or Option 2 below with
         respect to any Product, provided however, that Buyer may not
         concurrently order the same Product under Option 1 and Option 2. Option
         1 will apply unless Supplier and Buyer execute a logistics agreement,
         in which case Buyer and Supplier will implement Option 2.

               A. Option 1   No Logistics Agreement.

               Purchase Orders will be placed by Buyer. The Purchase Order lead
               time is indicated in Exhibit C.

               Buyer may cancel - in whole or in part - an accepted order prior
               to the agreed delivery date subject to a minimum prior written
               notice to Supplier as mentioned in Exhibit C [*] except as set
               forth in Exhibit C for custom Products.

               Buyer may reschedule a Purchase Order - in whole or in part -
               prior to the agreed delivery date subject to a minimum prior
               written notice to Supplier as mentioned in Exhibit C [*] except
               as set forth in Exhibit C for custom Products.

               B. Option 2 Logistics Agreement

               Provided a logistic agreement is executed between Supplier and
               Buyer regarding the list of concerned Products, the type of
               Products (standard or custom as indicated in Exhibit B), the
               required buffer stock (if any) per Product, Buyer and Supplier
               shall implement the following Option 2, unless Buyer and
               Supplier agree to implement other logistics conditions.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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1. Standard Products

- Buyer will provide Supplier with non-binding six (6) month rolling forecasts,
updated on a monthly basis .Such forecast shall represent a good faith
expectation of Buyer's anticipated needs and will be used by Supplier for
manufacturing planning purposes.

               The Purchase Order lead time is indicated in Exhibit C. Buyer may
               cancel, in whole or in part, purchase orders prior to the agreed
               delivery date subject to a minimum prior written notice to
               Supplier as mentioned in Exhibit C [*].

               Buyer may reschedule, in whole or in part, a Purchase Order prior
               to the agreed delivery date subject to a minimum prior written
               notice to Supplier as mentioned in Exhibit C [*].

               2. Custom Products

               Buyer will provide Supplier with non-binding, six (6) month
               rolling forecasts, updated on a monthly basis. Such forecast
               shall represent a good faith expectation of Buyer's anticipated
               needs and will be used by Supplier for manufacturing planning
               purposes. The first weeks of any such forecast corresponding to
               the manufacturing lead-time (as specified in Exhibit C) shall be
               a binding commitment of Buyer to purchase (hereinafter referred
               to as the "Demand Plan").

               -  The Purchase Order lead-time is indicated in Exhibit C.

               -  Buyer may cancel - in whole or in part - Purchases Order or a
                  Demand Plan, prior to the agreed delivery date subject to a
                  minimum prior written notice to Supplier as mentioned in
                  Exhibit C [*] except as provided in Exhibit C.

               -  Buyer may reschedule - in whole or in part - a Purchase Order
                  or a Demand Plan prior to the agreed delivery date subject to
                  a minimum prior written notice to Supplier as mentioned in
                  Exhibit C [*] except as provided in Exhibit C.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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               -  Supplier shall immediately cease to incur expense against the
                  cancelled or decreased Purchase Order or Demand Plan as of the
                  date of receipt of Buyer's prior notice as set forth in
                  Exhibit C.

3.4      Minimum quantities

No minimum quantity will apply to any individual Purchase Order, except as may
be mutually agreed between Supplier and Buyer.

4.       PLACE, DATE OF DELIVERY.

The Products shall be delivered as set forth in article 6 below.

Without prejudice to any other rights and remedies, if Supplier's delay exceeds
[*] (other than due to an Event of Force Majeure or Buyer's or its agents acts
or omissions), Buyer may cancel the affected portion of Products [*].

5.       TITLE AND RISK OF LOSS.

Title and risk of loss in the Products shall pass to Buyer as set forth in
article 6 below.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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6.       PRICE AND PAYMENT TERMS

6.1      Price and delivery

6.1.1.   Supplier shall invoice Buyer at the prices set forth in the applicable
         Exhibit B. The prices stated in this Exhibit are maximum prices for the
         Products ordered for delivery during the relevant time period.

         If, at any time, [*], then [*].

         The prices set forth in the applicable Exhibit B are stated in Euro
         (the "Original Currency").

6.1.2.   Supplier shall deliver the Products in accordance with the following
         International Chamber of Commerce Incoterms 2000:

           (i) FCA (Supplier's factory), provided that Buyer and Supplier may
           mutually agree upon other shipping terms for Products desired by
           Buyer in territories other than:

               EU
               CANADA
               CHINA
               USA

           (ii) Title to and risk of loss in the Products pass to Buyer upon
           delivery of Products to Buyer under Section 6.1.2(i) above.

6.2      Payments terms

6.2.1    Payment shall be made in the Original Currency, unless otherwise agreed
         by Supplier and Buyer.

         In this later case, the exchange rule will be as follows: if during
         three (3) consecutive months the average exchange rate varies by more
         than [*] percent ([*]%) Buyer shall notify Supplier before the 10th of
         the month of the variation (M). The new exchange rate will be
         implemented for the Purchase Orders placed from the first day of the
         following month (M+1) and for deliveries starting the first day of M+2.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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           Ex rate     1 Euro = 1 USD

6.2.2    Payment shall be made within [*] after the date of supplier invoice,
         invoice being made not sooner than the date of shipment, unless
         otherwise agreed between Buyer and Supplier.

7.       ACCEPTANCE AND REJECTION.

7.1      Supplier shall use commercially reasonable efforts to provide Buyer
         with reasonable assistance and information at Buyer's sole cost and
         expenses, that Buyer may reasonably request in performing Buyer's test
         under Section 7.5 below.

7.2      Buyer shall have [*] after the date of receipt of each shipment of
         product by Supplier to Buyer under Section 6 above to inspect the
         products for any patent defect such as non conformity in quantity or
         type of Product as set forth in the relevant Purchase Order. In the
         event that any shipment contains any such defect, Buyer shall have the
         right to reject the affected portion of the Products with respect to
         such Purchase Order.

7.3      Failure by Buyer to provide written notice of rejection within [*] of
         the date of receipt with respect to any shipment or part thereof in
         accordance with Section 7.1 above, shall be deemed Buyer's acceptance
         of the relevant shipment, or portion thereof, not subject to its
         written notice of rejection. Such acceptance shall not impair the
         warranties set forth in this Agreement.

7.4      Supplier agrees to promptly replace any non-conforming shipment or part
         thereof under section 7.2 above.

7.5      Buyer shall have the right to screen and test the ordered Products in
         order to retain such items it can accept.

7.6      Buyer shall notify Supplier of any hidden or epidemic failure rates
         within [*] after the date the hidden or epidemic failure becomes
         apparent by Buyer.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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7.7      Supplier shall notify Buyer within [*] if the date the hidden or
         epidemic failure becomes apparent and which Supplier is aware of in the
         relevant Product.

8.       WARRANTY.

Supplier warrants that the Products to be provided under this Agreement are new.

Supplier warrants that the Products shall meet the applicable specifications and
shall be free from defects resulting from faulty design, materials or
workmanship [*] from the date of delivery to Buyer under Section 6.1.2 above.

The returned material will be only accepted upon RMA procedure, RMA number being
given within no more than [*].

Supplier's sole obligation under this warranty shall be to [*].

This warranty shall not apply, inter alia, to defects or deterioration in
Products caused by or attributable to (i) utilization otherwise than in
accordance with instructions furnished by Supplier, or (ii) improper maintenance
and/or storage, or (iii) Products modification not provided for by Supplier.

THE FOREGOING WARRANTY SETS FORTH THE ENTIRE LIABILITY AND OBLIGATIONS OF
SUPPLIER, SUPPLIER AFFILIATED COMPANIES AND THEIR RESPECTIVE SUPPLIERS FOR
DEFECTS OR DEFICIENCIES IN THE PRODUCTS, WHETHER BASED ON BREACH OF WARRANTY, OR
OTHERWISE. THE WARRANTIES SET FORTH OR LIMITED HEREIN ARE THE SOLE AND EXCLUSIVE
WARRANTIES AND ARE IN LIEU OF ALL OTHER WARRANTIES, EXPRESS, IMPLIED, STATUTORY
OR OTHERWISE, INCLUDING WARRANTIES OF NONINFRINGEMENT, FITNESS FOR PARTICULAR
PURPOSE AND MERCHANTABILITY, ACCURACY OR TITLE. TO THE EXTENT AN IMPLIED
WARRANTY CANNOT BE EXCLUDED, SUCH WARRANTY IS LIMITED IN DURATION TO THE
WARRANTY PERIOD.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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9.       REPORTING AND REVIEWS.

Unless otherwise agreed, Supplier and Buyer will review on a quarterly basis
Supplier and the Buyer's performance under this Agreement. Such reviews shall
include, but not be limited to:

9.1.     Supplier's performance in respect of quality, on-time deliveries, price
         levels and lead times;

9.2.     If applicable, Buyer's performance in respect of notifying Rolling
         Forecasts and placing subsequent Purchase Orders.

9.3.     opportunities to enhance specifications for performance improvement.

9.4.     Buyer and Supplier each appoint contract coordinators as indicated in
         Exhibit B.

9.5.     Length of any Demand Plan, to the extent a six (6) month, rolling
         forecast is insufficient to permit Supplier to meet delivery, volume or
         pricing commitments agreed to with respect to Products under such
         Demand Plan.

10.      Quality

10.1     Quality Certification

         Supplier is responsible for utilizing processes, in the supply of the
         products and services covered in this Agreement, that are certified to
         ISO 9000 or planned to be certified ISO 9000 with a specified
         timeframe. Alcatel reserves the right to invoke the requirement for TL
         9000 registration with a mutually specified timeframe for compliance.

10.2     Quality Requirements

         Supplier is responsible for insuring that products furnished hereunder
         by Supplier have undergone or have been subject to Supplier's quality
         assurance and quality control activities and procedures, which may
         include performance measurements, testing, quality process reviews or
         inspections. Supplier's quality management system shall be capable of
         early and prompt detection of actual or potential and foreseeable
         material deficiencies, trends or conditions which could result in
         unsatisfactory quality, and for timely and effective corrective action.

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         Supplier is responsible for insuring that his suppliers and
         subcontractors maintain a quality system that supports the ISO 9000
         quality system requirements. The Supplier shall not appoint any
         subcontractor to carry out all or part of its obligations hereunder
         without having previously informed the Buyer.

         Buyer is entitled to conduct audits at Supplier's factories including
         its subcontractors' factories with, not less than, five (5) business
         days prior notice to Supplier. Types of audits that may be conducted
         include, but are not limited to, quality system audits, product
         specific audits, and process audits, provided that (i) Buyer may only
         conduct any such audit no more than twice during any twelve month
         period, (ii) the duration of such audit shall not exceed five (5)
         business days; and (iii) all costs and expenses related to such audit
         shall be borne exclusively by Buyer.

         Nothing contained herein will diminish Supplier's obligation to deliver
         defect-free material, under any warranty, or any other provision of
         this Agreement.

         Upon Buyer's request, Supplier shall provide Buyer with a certificate
         of conformance and/or test results and quality records with respect to
         Supplier's quality and/or ISO obligations under this Article 10.

         In addition, Supplier is responsible for complying with additional
         quality requirements as designated by any local agreements between
         Supplier and Buyer, as mutually agreed between the Parties.

11.      ENVIRONMENTAL REQUIREMENTS.

Supplier is responsible for complying with industry standards regarding
environmental care as well as with the specific standards required per
Supplier's region.

[*]

More specifically, Supplier is responsible for compliance with the substances
and product end of live European regulations.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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In addition, Supplier is responsible for complying with additional environmental
standards as designated by any local agreements between Supplier and Buyer.

12.      SUPPORT.

12.1     Supplier shall on a commercially reasonable basis, provide repair
         services and replacement parts for the Products, until the earlier of
         [*].

12.2     For as long as Buyer [*], Supplier will [*].

12.3     If for any reason during the term of this Agreement, Supplier intends
         to cease manufacturing or supplying Products conforming to the then
         current specification, Supplier shall give Buyer at least [*] prior
         written notice of its intention to cease manufacturing or supplying the
         Products in order for Buyer, at its option, to place an all last time
         buy. The delivery of such an all last time buy shall take place within
         [*] of the date of Supplier's notice of discontinuation.

13.      CHANGES.

13.1     Either Supplier or Buyer may request variations to any part of this
         Agreement, any Specifications, the obligations contained within this
         Agreement. All such requests must be made in writing.

13.2     The Party receiving such a request shall promptly (within no more than
         thirty (30) days) advise the other Party in writing of the effects of
         the proposed change upon the terms of this Agreement and the Products,
         in the event the proposed variation be implemented.

13.3     The Party receiving the request shall also promptly (within no more
         than thirty (30) days) advise the other Party whether or not it wishes
         to proceed with the proposed variation.

13.4     Until such time as any variation is formally agreed in writing and
         signed by an authorized representative of each Party, Supplier shall
         continue to perform and be paid as if such variation had not been
         requested or recommended.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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13.5     Notwithstanding the foregoing, if Supplier intends to change the
         manufacturing process or construction of the Products ("Manufacturing
         Change"), for example in order to solve essential products or costs
         problems, Supplier shall notify Buyer of any such change. If the
         Manufacturing Change involves a change of manufacturing location or a
         major construction or process change, such Manufacturing Change shall
         require Buyer's written consent before it is implemented.

14.      INTELLECTUAL PROPERTY

Supplier shall (i) defend or settle, at its option and expense, any claim of
infringement against Buyer alleging that the Product furnished under this
Agreement constitutes an infringement of any patent, copyright or trademark or
any other Intellectual Property rights of the third party introducing such
claim, (ii) reimburse Buyer for all damages and costs awarded in such proceeding
or settlement against Buyer and actually paid by Buyer; provided that Supplier
must be notified promptly in writing of any matter giving rise to possible claim
under this section and must be given the control and direction in the defense
and/or settlement of such claim, with counsel of Supplier's choice at Supplier's
sole expense.

If said Product, or any part thereof, is held to constitute an infringement in
such suit, and the making, use and/or sale of said Product or part is enjoined,
or said suit is settled on the basis of an undertaking to terminate such making,
use and/or sale of said Product as is alleged to constitute an infringement,
Supplier shall at its own expense and own choice, either (i) procure for Buyer
the right to continue using such Product; or (ii) send non-infringing
replacement Product; or (iii) modify said Product so that it becomes
non-infringing; or (iv) refund (the amount Buyer is required to refund to
Buyer's customer for the sale of the infringing product/Price Buyer received for
the Product from such customer) multiplied by the price paid by Buyer to
Supplier for such Product.

Supplier shall not be liable to Buyer under this section, if the infringement
proceeding or claim involves Products made, provided or modified by Supplier in
compliance with the requirements or specification of Buyer; or arises from (i) a
use for which the Product was not designated, or (ii) an alteration or
modification of the Product in question made by other than by Supplier or a
combination or use of that Product with another product which alteration,
modification or combination has caused the infringement action.

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The sale of any Product by Supplier shall not in any way confer upon Buyer, any
license under any patent claims of Supplier covering combination of Said Product
with other devices or elements, or the process or method of making such Products
or under any other intellectual property right of Supplier except the right to
use and resell the Products supplied hereunder.

The foregoing states the sole and exclusive remedy of Buyer and the entire
liability of Supplier for infringement of any intellectual property rights
arising out of this Agreement. In no event will the liability of Supplier under
this Section 14 exceed the total purchase price paid by Buyer to Supplier for
the affected products.

15.      LIABILITY.

15.1     Neither Supplier nor the Buyer shall be liable to the other for any
         special, indirect, incidental or consequential damages of any kind in
         contract or in tort including but not limited to loss of use, data,
         profit, income, business, anticipated savings, reputation as well as
         financing costs or increase in operating costs.

15.2     Alcatel shall not be held liable for the performance or non-performance
         or otherwise of any Purchase Orders of a Buyer and will not have any
         liability for damages resulting from any act or omission of a Buyer.
         Each Buyer will remain fully liable for all acts or omissions under its
         Purchase Order and will not be liable for any acts or omission under
         any other Purchase Orders.

16.      INSURANCE.

16.1     Insurance

Supplier will keep its business and properties insured at all times in
accordance with Supplier's then current insurance policies for its business and
properties involved in similar transactions as under this Agreement.

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During the term of this Agreement, all insurance must be maintained with
reputable insurers having a Standards and Poor's rating or Best's rating of [*]
in such amounts and with such limits and deductibles usually carried by persons
engaged in the same or similar business, but in any case, shall comply with the
Minimum Insurance Requirements detailed in this section.

Supplier shall be responsible for the payment of any deductible applicable under
the insurance policies indicated in this section.

         Buyer shall be named as additional insured on the General Liability
         insurance policies. Such policies should contain a "Cross Liability"
         provision.

         Supplier will provide to Buyer, upon Buyer's request with certificates
         of insurance, confirming that Supplier is compliant with its
         obligations under this clause. Supplier will provide Buyer with
         certificates of insurance at each renewal.

         Supplier will notify Buyer of any changes in terms, conditions and
         termination of such policies not less than 15 days after notification
         from the insurer.

Minimum Insurance Requirements

Without limiting its liability under this contract,
        Supplier will have to arrange the following insurance policies:

         General and Product liability - Minimum sum insured of USA$[*] per
         occurrence. This policy shall be in an occurrence basis.

Compulsory insurance (such as auto, workers' compensation, etc.)

16.2     Risk Management

         Supplier will use commercially reasonable efforts to maintain
         appropriate risk management programs on a site by site basis.

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

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         Supplier will have loss prevention inspections to be carried out at
         Supplier's production premises at least once per year, at Supplier's
         costs, by a specialized engineering consultant (independent or of his
         property insurer) and will address a copy of the complete loss
         prevention and underwriting report to Supplier and Buyer. This report
         should in particular comprise an estimate for the downtime and scenario
         in case of a maximum foreseeable loss.

16.3     Survival

         The provisions of this section shall survive the expiration of the term
         or sooner termination of this Agreement for a period of one (1) year
         thereafter.

17.      TERM AND TERMINATION.

This Agreement shall remain effective as of the Share Acquisition Closing as
such term is defined in the Share Acquisition and Asset Purchase Agreement (the
"Effective Date") for a period of three (3) years and shall thereafter be
automatically renewed for successive periods of one (1) year, unless a ninety
(90) days prior written notice of non-renewal is served by either party to the
other.

(i) Exhibits A, B and C will only apply to any purchase orders placed by Buyer
to Seller or, by the contract manufacturers or logistic service providers, from
January 1, 2003 until December 2003 as well as to purchase orders already placed
for delivery of the Products from January 1, 2003 until December 31, 2003; and

(ii) Alcatel and Supplier will agree upon new Exhibits A, B and C for each
subsequent year no later than December 31 of each year.

(iii) If Alcatel and Supplier do not agree on new Exhibits A, B and C by
December 31 of each year, the Exhibits A, B and C from the prior year will apply
until the parties agree on new Exhibits A, B and C.

17.1     Supplier or Buyer may terminate any Purchase Order immediately by
         notice in writing to the other Party if:

       17.1.1              the other Party commits any material breach or
                           persistent breach of any of the provisions of the
                           Purchase Order that is not remedied within 30
                           (thirty) days of written notification by the other
                           Party; or

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       17.1.2              in the limits authorized by law: an encumbrance takes
                           possession or a receiver or an administrative
                           receiver or administrator is appointed over any of
                           the property or assets of the other Party; or the
                           other Party makes any voluntary arrangement with its
                           creditors or becomes subject to an administration
                           order; or the other Party goes into liquidation
                           (except for the purposes of amalgamation,
                           reconstruction or other reorganization and in such
                           manner that the company resulting from the
                           reorganization effectively agrees to be bound by or
                           to assume the obligations imposed on that Party under
                           this Agreement) or either Party ceases to carry on
                           business.

18.      FORCE MAJEURE.

18.1     Neither Supplier nor a Buyer shall be liable hereunder to the other for
         any loss, injury, delay or damage suffered or incurred by the other
         Party due to fire, storm, explosion, acts of God, war, supervening
         legislation, governmental or other regulations and directions,
         shortages of necessary equipment, materials, labor caused by third
         party strikes, or any other cause beyond the reasonable control of
         either Party which could not be prevented and foreseen ("Force
         Majeure") and any failure or delay by either Party in the performance
         of any of its obligations under this Agreement due to any of the
         foregoing causes shall not be considered a breach of this Agreement and
         shall not give rise to any liability.

18.2     Should the delivery of any of the Products be directly delayed by force
         majeure, the time for delivery of those Products so delayed shall be
         extended by Buyer (provided that Supplier shall have first given Buyer
         prompt written notice after Supplier becoming aware of such cause) for
         a reasonable period having regards to the effect of the delaying cause
         upon the manufacture of the Products and Buyer's intended use of the
         Products delayed. However, Supplier shall do everything practicable to
         remedy any delay.

18.3     In the event that a circumstance of force majeure continues for a
         period of 6 (six) weeks then the Party not subject to force majeure
         shall have the right to terminate the uncompleted portion of those
         Purchase Orders so affected at no cost or liability to itself.

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19.      INVALIDITY.

Should any part of this Agreement be declared invalid and, or, unenforceable for
any reason whatsoever, such part shall be deemed to be severed from this
Agreement, and replaced with a valid and enforceable provision which reflects
the original intention of the Parties to the maximum extent permitted under law
and the remaining portion of this Agreement shall not be prejudiced and shall
continue in full force and effect.

20.      WAIVER.

No delay, neglect or forbearance by either Party in enforcing against the other
any term or condition of this Agreement shall be, or be deemed to be, a waiver,
nor shall it in any way prejudice any right of that Party under this Agreement.

21.      SURVIVAL OF OBLIGATIONS.

Notwithstanding termination of this Agreement, the Clauses detailed below shall
remain in full force and effect: Law, Headings, Intellectual Property, Support,
Warranty, Quality Assurance, Liability, Invalidity, Waiver, Survival Of
Obligations, Whole Agreement, Assignment, Subcontractors, intellectual property.

22.      ENTIRE AGREEMENT, AMENDMENTS.

22.1     This Agreement, as implemented by Purchase Orders is the sole and
         complete statement of the obligations of the Parties as to the sale and
         purchase of Products and supersedes all previous agreements and
         understandings between the Parties relating to the Products, and may
         not be modified except by an instrument in writing signed by the duly
         authorized representatives of the Parties. This Agreement may not be
         modified by the general sale or purchase conditions of either Party.

22.2     Any purported variation and/or addition to this Agreement shall be
         agreed in writing and signed by authorized signatories on behalf of
         both Parties.

                                       21
<PAGE>

23.      ASSIGNMENT.

After prior written information to the other Party, either Buyer or Supplier may
assign the Agreement or any Contract to any other Buyer or affiliated company as
defined on the front page of the Agreement.

24.      SUBCONTRACTORS.

[*] Supplier shall be free to appoint any subcontractor to carry out all or part
of its obligations but only after notice to Buyer; provided that such
subcontractors agree in advance in writing to abide by confidentiality
obligations set forth in this Agreement. Notwithstanding the foregoing, Supplier
shall remain directly and solely liable to Buyer for any acts or omissions of
any such subcontractor performing obligations on behalf of Supplier hereunder,
including but not limited to the confidentiality obligations.

25.      HEADINGS.

Headings in this Agreement are for convenience and shall not be used in the
interpretation or construction of this Agreement.

26.      HIERARCHY OF DOCUMENTS.

In case of any discrepancy or ambiguity between the Agreement and a Purchase
Order, the Agreement shall prevail over the Purchase Order and all other
documents related thereto.

27.      NOTICES.

27.1     Any notice, consent or communications required to be given or served
         hereunder shall be given or served by sending it by facsimile and
         confirming by first class mail to:

         In the case of Supplier:

[*] Certain information on this page has been omitted and filed separately with
the Commission. Confidential treatment has been requested with respect to the
omitted portions.

                                       22
<PAGE>

      Avanex Corporation
      40919 Encyclopedia Circle
      Fremont, CA 94538, USA
      Attention: Chief Executive Officer
      Fax: 510-897-4189

         In the case of Buyer:

      Alcatel
      54, rue La Boetie
      75008, Paris, France
      Attention: General Counsel
      Fax No.: 011-331-4076-1435

         or such other address as may be given in writing from time to time by
         either Party.

27.2     Any notice, consent or communication so sent shall be deemed to have
         been given or served on the second business day following the day of
         sending.

28.      CONFIDENTIALITY

28.1     Both for the duration of this Agreement and after termination or
         completion of this Agreement the Parties hereto shall keep the contents
         of this Agreement confidential and shall maintain the confidentiality
         of all information provided or made available to each by the other and
         shall use it only for the fulfillment of their respective obligations
         under this Agreement. Information covered by this provision includes,
         without limitation, information disclosed orally or in writing and
         information stored on disc or any other medium. Notwithstanding the
         foregoing, either Party shall be entitled to disclose both the
         existence and terms of this Agreement to (i) attorneys, accountants,
         and similar agents of a Party which are bound by non-use and
         non-disclosure obligations and (ii) other third parties, bound in
         writing to non-use and non-disclosure obligations, in connection with a
         merger, acquisition, investment round or similar corporate
         reorganization or capitalization of a Party.

                                       23
<PAGE>

28.2     The above shall not apply to any information to the extent that such
         information:

       28.2.1              is or becomes freely available to the public without
                           breach of an obligation of confidentiality hereunder;
                           or

       28.2.2              lawfully received by the receiving Party from a third
                           Party without breach of obligation or confidence; or

       28.2.3              can be shown to have been in the lawful possession of
                           the receiving Party prior to receipt from the
                           disclosing Party or to have been developed by the
                           receiving Party independently of receipt from the
                           disclosing Party; or

       28.2.4              is required by order of the Court to be disclosed;

28.3     Subject to Confidentiality and notwithstanding termination of this
         Agreement the obligations of confidentiality contained hereunder shall
         continue to subsist for a period of 5 (five) years from the date of
         this Agreement.

29.      APPLICABLE LAW - SETTLEMENT OF DISPUTES

This Agreement shall be governed by the laws of France. Any dispute arising out
of this Agreement shall be finally settled under the Rules of Conciliation and
Arbitration of the International Chamber of Commerce by three (3) arbitrators
appointed in accordance with said Rules, in New York City, New York. The
arbitration, agreements, evidence and any other materials used by either Party
in the course of making their case before such arbitrators will be in the
English language

30.      BUSINESS PRACTICES.

Supplier recognized having been made fully acquainted with Alcatel statement of
Business Practices dated March 11th, 2003 (as may be updated from time to time)
http://www.alcatel.com and undertakes to apply the principles set out therein
with respect to the performance of this Agreement, in particular with reference
to non-discrimination of employees, combating bribery of domestic and foreign
public officials, protection of international human rights and environmental
responsibility.

                                       24
<PAGE>

Supplier recognizes that violation of such principles which constitute a breach
of any applicable laws, rules, judgments or orders or similar legally imposed
requirements to which Buyer and Supplier are subject shall be deemed a breach of
this contract.

                                       25
<PAGE>

Executed in two original copies

   For Alcatel:                                     For Avanex Corporation:
   Name                                             Name
   AL Scaillierez                                   Anthony Florence
   Acting as                                        Acting as
   Buyer                                            Supplier

   Signature                                        Signature

   /s/ AL SCAILLIEREZ                               /s/ ANTHONY FLORENCE

   Date  31/07/03                                   Date 7/31/03

                                       26<PAGE>

                                                                    EXHIBIT 10.9

                                                                     Translation
                                COMMERCIAL LEASE

BETWEEN THE UNDERSIGNED:

SOCIETE IMMOBILIERE VILLARCEAUX-NOZAY, a French Societe par Actions Simplifiee
with share capital of (euro)547,500, registered office situated at 12 rue de la
Baume, 75008 Paris, registered at the Paris Trade and Companies Registry,
registration number B 319 266 722, duly represented by its authorised agent, the
company CMS, itself represented by its Manager, Mr. Jean-Pierre Baron,

                                                               of the first part
                                       Hereinafter referred to as the "Landlord"

AND:

AVANEX FRANCE, a French Societe Anonyme, with share capital of (euro)
214,233,000, registered office situated at Route de Villejust, 91625 Nozay
Cedex, registered at the Evry Trade and Companies Registry, registration number
B 392 305 652, represented by Philippe Bregi, Chairman and Chief Executive
Officer, duly empowered for the purposes hereof

                                                              of the second part
                                         Hereinafter referred to as the "Tenant"

<PAGE>

WHEREAS:

The Tenant has been developing its business operations on the Nozay business
park over the past few years, notably by entering into several commercial leases
with the Landlord. It currently has three leases over Buildings A, A' and A2/A3
respectively.

Following the Alcatel Group's sale of Alcatel Optronics to Avanex, the Tenant
and Landlord agreed to terminate the three existing leases with effect from 1
August 2003 and to replace them simultaneously with this single nine-year lease
covering Buildings A, A' and A2/A3 with effect from that date.

IT IS NOW HEREBY AGREED AS FOLLOWS:

COMMERCIAL LEASE GOVERNED BY THE PROVISIONS OF ARTICLES L 145-1 TO L 145-60 OF
THE CODE DE COMMERCE AND THE PROVISIONS OF THE DECREE OF 30 SEPTEMBER 1953.

The Landlord hereby grants the Tenant and the Tenant hereby accepts a lease
(hereinafter the "Lease") over the premises described below (hereinafter the
"Premises"). The Tenant hereby represents and warrants that it has full
knowledge of said Premises having occupied them prior to entering into this
Lease.

ARTICLE 1 - DESCRIPTION - PURPOSE

The Premises subject of this Lease are situated on a business park at
Villarceaux, 91620 Nozay (hereinafter the "Business Park") and comprise the
following buildings, plans of which are attached to this Lease as an appendix:

-   Building A: a three-storey concrete framed building, with a floor area of
    approximately 6,230 sq.m.;

-   Building A': extension to Building A with a floor area of approximately
    3,500 sq.m.;

-   Buildings A2/A3 with two main storeys and a total floor area of
    approximately 9,030 sq.m.

Making a total floor area of approximately 18,760 sq.m.

These floor areas are indicative only and are given without warranty on the part
of the Landlord.

The Premises are intended primarily for industrial use with accompanying office
space.

ARTICLE 2 - TERM

The Lease will be granted and accepted for a term of nine full and consecutive
years with effect from 1 August 2003, expiring on 31 July 2012.

The Tenant shall have the option of terminating the Lease, by giving six months
notice thereof either served by bailiff or sent by registered mail, on 31 July
2006, 31 July 2009 and 31 July 2012.

<PAGE>

Should the Lease be renewed, it shall have a new term of nine years with the
option for the Tenant of terminating on a three-yearly basis. The provisions of
Article L 145-4 paragraph 2 of the Code de Commerce shall not apply.

The parties agree that the Tenant may terminate the Lease at the end of each
three-yearly period either for all the buildings forming the Premises or for
each one of the buildings separately, being Building A, Building A' and Building
A2/A3. The Tenant may accordingly vacate one of the buildings without being
obliged to vacate the others.

ARTICLE 3 - RENT

The Lease is granted and accepted in consideration for an annual total rent
excluding VAT and service charges of TWO MILLION, SIX HUNDRED AND EIGHTY SEVEN
THOUSAND TWO HUNDRED AND EIGHTY SIX EUROS AND FIFTY-EIGHT EURO CENTS
((euro)2,687,286.58), broken down as follows:

-   Building A (6,230 sq.m.):(euro)177.51 excluding VAT and charges per sq.m.
    per annum, making a total of(euro)1,105,869.07 per annum excluding VAT and
    charges;

-   Building A' (3,500 sq.m.):(euro)120.62 excluding VAT and charges per sq.m.
    per annum, making a total of(euro)422,161.02 per annum excluding VAT and
    charges;

-   Buildings A2/A3 (9,030 sq.m.):(euro)128.38 excluding VAT and charges per
    sq.m. per annum, making a total of(euro)1,159,256.48 per annum excluding VAT
    and charges.

The rent shall be payable in advance in four equal quarterly instalments on 1
January, 1 April, 1 July and 1 October each year.

The rent is expressed exclusive of value added tax (VAT), the Landlord having
opted for liability to the VAT regime. The Tenant accordingly undertakes to pay
the Landlord in addition to the rent referred to above the amount of VAT or any
other tax which may replace it at the rate prevailing on the date of each
payment.

The amount of the first rent payment corresponds to rent due for the period
beginning on the effective date of the Lease and ending on the final day of the
current calendar quarter. The Tenant has accordingly this day paid the Landlord
the sum of (euro)535,665.79 inclusive of VAT.

Should the Tenant terminate the lease over one of the buildings, the rent
payable shall be reduced by the amount corresponding to the rent attributable to
the vacated building with effect from the date of vacation.

ARTICLE 4 - RENT REVISION

The rent shall be index-linked each year to the Cost of Construction index
published quarterly by INSEE taken over four consecutive quarters and shall
accordingly be revised ipso jure on 1 January of each year.

For the first revision, which shall take place on 1 August 2004, the base index
shall be that prevailing for the first quarter of 2003, being 1,183 and the
revision index shall be that prevailing for the first quarter of 2004. In each
subsequent year, the base index for that year shall be the revision index for
the previous year and the revision index shall be that published four quarters
later.

<PAGE>

The rent revision is applicable automatically and no further notice need be
given. No failure on the Landlord's part to apply the revision immediately shall
prevent either party from exercising its right to claim application of the
revision with retroactive effect.

Should the INSEE cease to publish the Cost of Construction index and no new
official index takes its place, it shall be replaced by an equivalent index
chosen by mutual agreement of the parties, or failing that by an expert
appointed by mutual agreement of the parties or by order of the President of the
Tribunal de Grande Instance at the request of either party. The costs shall be
divided equally between the parties, whether the expert is appointed by mutual
agreement or by court order.

ARTICLE 5 - SECURITY DEPOSIT

The Tenant has this day paid the Landlord a deposit in the sum of six hundred
and seventy one thousand, eight hundred and twenty one euros and sixty four euro
cents ((euro)671,821.64), equating to three months rent excluding VAT and
charges, to guarantee performance of its undertakings hereunder.

RECEIPT IS HEREBY ACKNOWLEDGED

The amount of the deposit shall be automatically index-linked in accordance with
the provisions of Article 4 above such that it is always equal to three months
rent excluding VAT and charges.

Insofar as necessary, it is stipulated that the interest earned on the security
deposit shall be retained by the Landlord.

The security deposit shall not be returned until the Tenant has discharged all
its obligations hereunder, including but not limited to payment of all rent and
charges due to the Landlord, completion of the work required to return the
Premises to their original state of repair as provided for under Article 18
hereof, and completion of all works required by the authorities under
regulations governing the discontinuation of a hazardous classified activity as
stipulated in Article 6.5 hereof.

ARTICLE 6 - SERVICE CHARGES AND RENTAL TERMS AND CONDITIONS

6.1      COMPLIANCE WITH BUILDING REGULATIONS AND STANDARDS: OBLIGATIONS OF THE
         PARTIES

In the event of a change in the regulations governing the Premises and their
use, the Tenant shall carry out the works required to comply with the new
standards imposed by the introduction and/or applicability of:

(i)      an existing regulation which did not apply to the Premises on the
         effective date of the Lease but which became applicable after that
         date;

(ii)     a new regulation enacted after the effective date of the Lease, which
         is applicable to the Premises due to their status.

<PAGE>

The Tenant shall obtain all consents for such works after consultation with the
Landlord and in compliance with the provisions of Article 6.6.2 hereof.

6.2      CONTRACTUAL USE

6.2.1    The Tenant agrees to occupy the Premises honourably and peacefully in
         accordance with their intended use as indicated in Article 1 hereof and
         Articles 1728 and 1729 of the Code Civil.

         The activity conducted in the Premises shall not give rise to any
         breach, complaint or claim from anyone whatsoever. The Tenant shall
         accordingly be personally responsible for dealing with all grievances
         made to the Landlord as a result of the Tenant's activity, including
         those relating to the legal and administrative status of the Premises,
         such that the Landlord is never troubled and is held harmless from any
         consequences that may arise therefrom.

6.2.2    The Tenant hereby represents and warrants that it accepts all existing
         or future constraints relating to the classification of all or part of
         the Business Park as a hazardous classified facility (Etablissement a
         Regime Restrictif - E.R.R.) and the introduction of Restrictive Zones
         on the Business Park.

         Should the Tenant's own activity require the implementation of such
         safety measures, the Tenant undertakes to advise the Landlord of the
         consequences of those measures on the operation of the Business Park
         itself. The Tenant shall bear all costs of any nature whatsoever
         directly or indirectly related to the implementation of safety measures
         for its own benefit.

6.3      FURNISHING AND OPERATION

6.3.1.   Furnishing

         By derogation to Article 1752 of the Code Civil, the Tenant is under no
         obligation to furnish the Premises.

6.3.2    Maintenance in effective state of operation

         The Tenant shall maintain the Premises in an effective state of
         operation save during periods required to redeploy the Tenant's
         employees as a result of trends in its business activities.

         The Tenant is fully aware of the state of repair of the Premises and
         shall be personally responsible for conducting the compulsory
         periodical controls relating to asbestos, termites and where applicable
         other wood-boring insects, legionnella and more generally any
         periodical controls relating to health and safety regulations which
         might prove necessary during the term of the Lease. The Landlord
         undertakes to advise the Tenant of any requests it might receive in
         this respect from a government authority.

         The cost of any eradication or works which prove necessary as a result
         of such controls shall be borne by the Landlord unless the requirement
         for the works is

<PAGE>

         attributable to one or more of the Tenant's specific activities or the
         specific conditions under which the Tenant and/or other occupants
         operate the Premises.

         The Tenant shall further bear the cost of or procure that any
         sub-lessee with whom the Tenant shall remain jointly and severally
         liable shall bear the cost of any requirements including the completion
         of works which may be imposed by the DRIRE or the fire brigade due to
         one or more of the specific activities conducted by the Tenant or its
         sub-lessees or due to the specific conditions under which the Premises
         are operated and notably resulting from the existence and operation by
         the Tenant or any of its sub-lessees of hazardous classified
         facilities.

6.4.     CONSENTS

As regards the consequences of its methods and conditions of occupation and/or
use of the Premises, the Tenant undertakes as follows:

(i)      to comply with all regulations and ordinances in force, notably as
         regards roads, police, health, APSAD employment rules and safety, such
         that the Landlord shall never be troubled or held liable in this
         respect;

(ii)     to be personally responsible for dealing with all claims or injunctions
         which may be made by the competent authorities in this respect;

(iii)    to be personally responsible for obtaining all administrative consents
         which may be required in this respect;

(iv)     to pay all sums, fees, taxes and other duties which may become due and
         payable in this respect.

6.5      HAZARDOUS CLASSIFIED FACILITIES

The Tenant hereby represents and warrants that it is fully aware of the
administrative obligations imposed under regulations relating to hazardous
classified facilities.

The Tenant undertakes to comply strictly with such regulations and to make the
appropriate declarations and applications for consents for its own facilities.

The Tenant undertakes to advise the Landlord of any declaration or application
for consent it makes and of any acknowledgement of receipt, advice of public
enquiry or decree granting consent issued by the competent authorities.

Upon vacation of the Premises, the Tenant undertakes to fulfil all
administrative requirements relating to the discontinuation of a hazardous
classified business and to take all measures that may be validly required by the
competent authorities resulting from the conditions surrounding the
discontinuation of such business.

6.6      MAINTENANCE - WORKS - REPAIRS

6.6.1    General terms and conditions

The Tenant shall maintain the Premises in a proper state of repair throughout
the term of the Lease and shall in this respect carry out all repairs which may
be necessary, with the sole exception of those major repairs strictly referred
to in Article 606 of the Code Civil.

<PAGE>

Insofar as necessary, it is stipulated that the Tenant shall bear the cost of
repairing, replacing, maintaining in a proper state of safety and cleanliness
and generally maintaining the equipment required for normal use of the Premises,
such as electrical, plumbing, fire detection and protection, lifting,
ventilation, air conditioning, security, glass, ironmongery, joinery,
information systems, sanitary or other installations.

In this respect, the Tenant undertakes to repair any dilapidations to the
Premises as and when they occur.

The Tenant undertakes not to carry out any demolitions, pierce load-bearing
walls or arches or carry out any construction without the prior written consent
of the Landlord.

6.6.2    Terms and conditions governing works carried out by the Tenant

(a)      Before beginning any works, the Tenant shall provide the Landlord with
         a pack including the following:

         (i)      A description of the scheduled works and equipment;

         (ii)     A timetable for the works with a detailed methodology;

         (iii)    A report from an authorised inspection agency on the impact of
                  the proposed works on the security regulations applicable to
                  the Premises;

         (iv)     Where applicable, copies of all requisite administrative
                  consents.

         These provisions shall also apply to the installation of any equipment
         or facilities destined to be a permanent fixture to the building.

(b)      The works may not begin until fifteen calendar days after the
         Landlord's receipt of the pack referred to above and provided the
         Landlord has not expressed disagreement. The Landlord may only withhold
         agreement on the following grounds:

              -        a proven adverse impact on the value of the Premises;

              -        breach of safety regulations;

              -        breach of building and/or planning regulations;

              -        breach of the provisions of the Lease.

(c)      The Tenant shall carry out the works in accordance with industry
         standards, using good quality materials and employing qualified
         contractors, consultants and inspection agencies.

         For all works, the Tenant shall use only those qualified contractors
         which have adequate insurance cover. More generally, the Tenant shall
         take out or cause to be taken out the necessary insurance for the works
         including sufficient cover for consequential loss, and shall provide
         the Landlord with evidence thereof at the Landlord's first demand,
         accompanied by evidence that the corresponding premiums have been paid
         and are up to date.

         The works shall be carried out, should the Landlord so request, under
         the supervision of the Landlord's technical consultant, whose role
         shall be to verify compliance with all technical regulations and with
         the pack referred to in (a) above.

<PAGE>

(d)      The Tenant shall bear all costs arising as a result of such works, with
         the exception of fees charged by the Landlord's technical consultant.

(e)      The provisions of Article 6.6.2 (a) and (b) above do not apply to works
         involving cable networks and removable partitions.

(f)      The Tenant shall hold the Landlord harmless from all liability towards
         third parties in respect of physical damage or consequential loss
         resulting directly or indirectly from works carried out by the Tenant.
         The Landlord shall similarly hold the Tenant harmless from all
         liability towards third parties in respect of physical damage or
         consequential loss resulting directly or indirectly from works carried
         out by the Landlord.

6.6.3    Works to be carried out by the Landlord

By derogation to Article 1724 of the Code Civil, the Tenant shall suffer without
compensation or rent abatement all urgent and necessary works which the Landlord
may be obliged to carry out in the Premises in accordance with the provisions of
Article 6.6.1 above, regardless of the duration and even beyond a period of
forty days. The Landlord undertakes to use best endeavours to complete such
works without delay and to limit the inconvenience caused to the Tenant.

The Tenant shall give the Landlord, its representatives, architects, contractors
and tradesmen access to the Premises for the purpose of visiting, repairing and
maintaining the Premises. The Landlord shall give the Tenant no less than eight
calendar days notice of such visits. The Landlord or its representatives shall
comply with the Tenant's access control standards.

6.7      PLATES AND SIGNS

The Landlord hereby represents and warrants that it approves all the signs
existing on the effective date of the Lease.

The Tenant shall be entitled to affix any sign to the Premises relating to the
activities conducted therein, provided the requisite administrative consents
have been obtained and the Landlord has given its consent, which may not be
withheld other than on legitimate and serious grounds which must be justified to
the Tenant.

6.8      UTILITIES

The Tenant shall take out all electricity and telecommunications contracts
required for the conduct of its business. Upon expiry of the Lease, the Tenant
shall be personally responsible for cancelling any such contracts.

The Tenant shall pay all standing charges, taxes and consumption charges
directly to the utility concerned.

The Tenant shall bear the cost of maintaining electrical lighting and power
supply networks, low voltage networks and fuse boxes situated in the Premises.

<PAGE>

6.9      COMMON FACILITIES AND SERVICES

From the effective date of the Lease, the Tenant shall pay all sums
corresponding to its share of the cost of maintaining and operating the common
facilities and services on the Business Park, such that the rent received by the
Landlord is clear of all charges.

For the purposes of applying the provisions of this Article, it is stipulated
that services common to all buildings and tenants on the Business Park shall be
managed by the Landlord.

The Tenant acknowledges that it is aware of and will comply with the Landlord's
method of managing the common facilities and services on the Business Park and
undertakes to enter into a Common Services Agreement with the Landlord after
execution of the Lease.

Common facilities and services principally encompass removal of ordinary waste,
maintenance of landscaped areas, cleaning of all external areas, maintenance of
common networks, general security of the site and management and maintenance of
a common telephone switchboard.

The Landlord shall manage the common facilities and services on similar
financial terms and conditions to those practiced by CIT between 1 January 2003
and 31 July 2003.

The Tenant hereby undertakes to pay in accordance with the aforesaid terms and
conditions, along with each rent payment, a proportion of the shared charges set
out in the Common Services Agreement and corresponding to a quarter of the
annual budget fixed by the Landlord.

The Landlord shall at the beginning of each calendar year adjust the charges
based on the actual cost incurred on behalf of the tenants. The Landlord shall
establish the difference between the Tenant's share in the actual costs and the
charges paid in advance during the year and shall issue an invoice or credit
note as appropriate.

ARTICLE 7 - INTERCOMPANY RESTAURANT

The Tenant shall be entitled to use the intercompany restaurant situated on the
Business Park.

The intercompany restaurant is governed by a contract appointing Alcatel CIT as
representative of all parties thereto. The Tenant acknowledges that it has read
the contract having been a tenant of the Business Park prior to execution of the
Lease and undertakes to fulfil all its obligations under the contract or any
other contract which might replace it such that the Landlord shall never incur
any expense or cost in that respect.

ARTICLE 8 - STATE OF REPAIR OF PREMISES - POSSESSION

The Tenant hereby represents and warrants that, being an existing and former
tenant of the Premises, it is fully aware of the state of repair thereof and
accepts the Premises in that state of repair with no right to claim any
alterations or repairs by the Landlord due to non-compliance with any regulatory
standards in force and applicable prior to the date of execution hereof, and
notably those standards concerning safety of employees and access for disabled
persons.

<PAGE>

The Tenant further waives all right of recourse against the Landlord with
respect to the environmental status and/or the administrative and legal status
of the Premises (buildings compliance, allocation, use, etc.) prior to the date
of execution hereof.

At the initiative of either party, an inventory shall be drawn up by a bailiff
no later than two months from the effective date of the Lease, the costs to be
shared equally between the Tenant and Landlord.

ARTICLE 9 - SUB-LETTING - ASSIGNMENT

9.1      SUB-LETTING

a)     The Tenant may sub-let its rights in the Lease in full or in part to any
       company with the prior written consent of the Landlord, such consent not
       to be unreasonably withheld or delayed or subject to conditions which
       bear no relation to the proposed sub-tenant. In any event, the Tenant may
       sub-let the Premises to its subsidiaries or any companies belonging to
       the Avanex Group without the Landlord's prior consent.

b)     Should consent be given, the Tenant shall send the Landlord by registered
       mail a copy of the proposed sub-lease for the Landlord's approval, the
       clauses of which shall be substantially the same as those contained
       herein.

c)     The sub-letting(s) shall not be binding upon the Landlord and the
       sub-lease shall include an express waiver on the part of the
       sub-tenant(s) of all claims against the Landlord and all rights to renew
       the sub-lease.

d)     Any partial sub-lettings must encompass a coherent block (meaning one of
       the four buildings in its entirety as described in Article 1 hereof) in
       order to avoid excessive sub-division over time.

e)     All sub-lettings, to whatever level, shall be granted at the risk and
       peril of the Tenant and the Tenant undertakes to be personally
       responsible for evicting any occupant of the Premises.

9.2      ASSIGNMENT

a)     The Tenant may assign the full benefit of the Lease to:

(i)    the purchaser of its business;

(ii)   any company with the Landlord's prior written consent, which may not be
       unreasonably withheld or delayed or subject to conditions which bear no
       relation to the proposed assignee. In any event, the Tenant may assign
       the benefit of the Lease to its subsidiaries or any companies belonging
       to the Avanex Group without the Landlord's prior consent.

       The assignee shall provide the Landlord with evidence that it has at
       least an equivalent level of solvency and standing as the Tenant with
       respect to the undertakings assumed by virtue of the assignment.

<PAGE>

b)     The Landlord shall advise the Tenant of its consent or refusal of the
       proposed assignee by registered mail or notice served by bailiff, no
       later than fifteen full days after receiving notice of the Tenant's
       intention to assign the benefit of the Lease.

c)     The assignment shall be made by notarised deed or private agreement and
       the Tenant shall seek the Landlord's approval thereto with at least
       fifteen days notice sent by registered mail.

       An enforceable or original registered copy of the assignment shall be
       given to the Landlord no later than one month after its execution, at the
       expense of the Tenant.

d)     No assignment or transfer may be made if any rent and/or service charges
       are outstanding by the Tenant to the Landlord.

e)     In any event, the Tenant shall remain jointly and severally liable with
       the assignee and any subsequent assigns both in respect of payment of
       rent and other charges and in respect of performance of any obligations
       and conditions under the Lease, with no right of beneficium divisionis or
       beneficium excussionis.

ARTICLE 10 - INSURANCE - LIABILITY - RECOURSE

10.1     The Landlord undertakes to contract the following insurance with
         reputable insurance companies:

(i)    Insurance of the Premises, at replacement value including all fixtures
       within the meaning of Article 525 of the Code Civil, against all usual
       risks of destruction and notably the following:

       Fire and lightning, explosion of any nature, electrical damage, fall of
       aircraft and airborne objects, collision of vehicles belonging to third
       parties, natural disasters, notably hurricanes, cyclones, tornadoes,
       storms and hail, smoke, strikes, riots and popular unrest, vandalism and
       malicious acts, water damage, damage related to plumbing, heating and
       cooling systems.

       Insurance shall include related cover, and notably loss of rent for a
       period of three years, rubble removal costs and expert's fees.

(ii)   Public liability insurance covering bodily injury or material damage
       caused to third parties as a result of the buildings, fixtures and
       facilities in common areas, and the activities of employees responsible
       for such common areas. It is stipulated that the tenants are deemed to be
       third parties with respect to the Landlord.

10.2     In the event of a claim covered by the insurance referred to in Article
         10.1 above, the Landlord shall waive and shall procure that its
         insurers shall waive all recourse they may have against the Tenant and
         its insurers or other occupants of the Premises let to the Tenant.

The Tenant shall reimburse the Landlord, along with the service charges, its
share of the insurance premiums due on the policies referred to Article 10.1 (i)
above.
<PAGE>

10.3     The Tenant shall insure and keep insured with a reputable insurance
company throughout the entire term of the Lease all fittings it may have made in
the Premises and all objects, furniture, equipment and goods belonging to it and
held in the Premises, against fire, water damage, short circuits, explosion and
all other risks customarily insured, recourse by neighbouring tenants and third
party liability particularly with respect to bodily injuries arising as a result
of accidents occurring in the Premises or for which the Tenant could be held
responsible. The Tenant shall pay all premiums related to such insurance and
provide evidence thereof each time the Landlord so requests.

The policy shall include a waiver from the insurance company of any recourse to
the Landlord, the Landlord's representatives or the insurers of those persons
for the share of any damages or losses for which they may be held responsible in
any way whatsoever.

10.4     Should the Tenant fail to take out said insurance policies and/or pay
the premiums thereon, the Landlord reserves the right to do so in the Tenant's
place, in which case the Tenant undertakes to reimburse the Landlord for all
sums paid in this respect, together with interest at the rate referred to in
Article 20.2 below, which shall be applied ipso jure and without further notice
with effect from the due date of the sums in question.

10.5     The Tenant shall without delay advise the Landlord in writing of any
damage occurring in the Premises, failing which the Tenant shall be held
personally liable for reimbursing any direct or consequential loss arising for
the Landlord as a result of such damage, or held personally responsible if the
Landlord is unable to report the claim to its insurers within good time.

10.6     Should the activity conducted by the Tenant lead to a premium surcharge
either for the Landlord or the neighbouring tenants, the Tenant shall compensate
the Landlord for the additional premium and hold it harmless against any claims
from neighbouring tenants.

10.7     Special provisions concerning fitting out works

The Tenant undertakes to hold the Landlord harmless from all liability for
injuries, losses or damage to all persons or things caused directly or
indirectly by fitting out work carried out by the Tenant. The Tenant shall take
out third party liability insurance to this end.

Should such fitting out work be supervised by an architect, the architect must
at all times be covered by third party liability and professional indemnity
insurance and be able to prove that the insurance premiums thereon have been
paid and are up to date.

ARTICLE 11 - CLAIMS MADE BY OR AGAINST THIRD PARTIES

The Tenant shall be personally responsible, at its own risk, peril and expense,
for all claims made by neighbouring tenants or third parties, including but not
limited to claims in respect of noise, odours, heat or tremors caused by the
Tenant or by equipment belonging to the Tenant during the term of the Lease or
upon the Tenant's vacation of the Premises, such that the Landlord shall never
be troubled or held liable in this respect.

Should the Landlord be obliged notwithstanding to pay any sums arising as a
result of such claims, following the Tenant's failure to respond to the
Landlord's notice, the Tenant shall undertake to reimburse the Landlord.

<PAGE>

The Tenant shall be personally responsible for dealing with all damage caused to
the Premises and all disturbance of possession caused by neighbouring tenants or
third parties and shall take action directly against the perpetrators of such
disturbances such that the Landlord shall never be troubled in this respect.

ARTICLE 12 - LIABILITY AND RECOURSE

The Tenant waives all recourse against the Landlord and all rights to claim a
rent abatement in the following circumstances:

(i)      should one of the components of either the common or individual
facilities, such as lifts, heating and air conditioning systems, backup
electricity system, telephone installations and company restaurant, be out of
service or non-operational even for a prolonged period of time, for reasons
outside the Landlord's control;

(ii)     in the event of damage caused by fire, theft, water, humidity or any
other circumstance affecting the Tenant's belongings or fixtures or in the event
of partial destruction of the Premises, to the extent that the Landlord shall
without delay take measures to remedy the situation;

(iii)    in the event of theft or other offences committed in the Premises, the
Landlord being under no obligation to provide specific security services.

In the event of material damage or consequential loss, the Tenant waives all
rights to claim compensation from the Landlord for loss of enjoyment or loss of
business due to the total or partial discontinuation of its activity, save where
the Landlord is proved to be at fault.

ARTICLE 13 - DESTRUCTION OF THE PREMISES

Following a fire, explosion of any kind or other damage (destruction of Premises
or physical inability to use the Premises for the contractual purpose set out in
Article 1, save where caused by administrative reasons):

(i)      should all the Premises or a surface area representing more than 50% of
the Premises be destroyed or rendered unusable, the Lease shall be terminated
ipso jure with no compensation on either side. The entire benefit of insurance
compensation shall be acquired by the Landlord (without prejudice to the
application of any provisions of the Code des Assurances or any assignment of
compensation which may be granted by the Landlord);

(ii)     should one of the buildings be destroyed or rendered unusable, the
Landlord shall have the building(s) rebuilt and shall grant the Tenant a rent
abatement pro rata to the floor area destroyed or rendered unusable during the
reconstruction period.

In the event of reconstruction as referred to in Article 13 (ii) above, the
Tenant waives all right to claim compensation from the Landlord whether in
respect of works carried out or the unavailability of the building which has
been destroyed. The Landlord undertakes to use best endeavours to have the
damaged building(s) rebuilt without delay and according to the prevailing
building standards and, more generally, planning regulations.

<PAGE>

Should the surface area of the new building be greater than the surface area
destroyed or rendered unusable, the additional new space shall not be included
in the scope of the Lease and the Tenant shall have one month from the date on
which the final administrative consents have been granted to exercise a right of
preference to have the additional space included in the scope of the Lease.

Should the surface area of the new building be less than the surface area
destroyed or rendered unusable, the new building shall be included in the scope
of the Lease in its entirety and the Tenant shall benefit from a rent abatement
pro rata to the surface area destroyed or rendered unusable and not rebuilt.

ARTICLE 14 - DISRUPTION TO COMMON SERVICES

The Landlord shall not be held liable for malfunctions or disruptions in water,
gas, electricity or any other similar common service outside the Premises. The
Landlord shall be under no obligation to advise the Tenant of such disruptions
unless it had prior knowledge thereof.

ARTICLE 15 - TAXES AND DUTIES

The Tenant shall pay all its personal direct and indirect contributions, rental
taxes and business use tax and shall provide evidence of their payment at the
Landlord's request and upon expiry of the Lease with at least eight days notice
prior to departure with respect to sums due on that date.

The Tenant shall further reimburse the Landlord for the annual office use and
storage use tax relating to the Premises and any taxes relating to the Premises
which may be created in the future where the designated legal taxpayer is the
Landlord. The Landlord shall send all demands for the annual office and storage
use tax to the Tenant no later than ten days after receipt thereof.

The Landlord shall be responsible for paying the land tax relating to the
Premises.

ARTICLE 16 - COMPLIANCE WITH ADMINISTRATIVE REGULATIONS

The Tenant shall comply with all laws, regulations and ordinances in force, and
more specifically those relating to roads, health, police, safety and factory
inspections, such that the Landlord shall never be troubled or held liable in
this respect.

Such authorisations may under no circumstances be deemed to be a condition
precedent to performance of the Lease.

ARTICLE 17 - VISITS TO PREMISES

The Landlord reserves the right both for itself and its duly authorised
representatives to gain access to the Premises during business hours in order to
take emergency measures to protect its rights and/or have repairs made to the
Premises, subject to giving the Tenant twenty-four hours notice thereof.

Should the Tenant give notice to terminate the Lease or should the Premises or
the Business Park be put up for sale, the Tenant shall permit prospective
tenants or purchasers to visit the Premises, accompanied by the Landlord or its
duly authorised representative, on all business

<PAGE>

days between the hours of 10 a.m. and 5 p.m., to the extent that the Landlord
shall, wherever possible, give the Tenant twenty-fours hours notice of such
visits.

In any event, the Landlord or its duly authorised representatives shall comply
with the safety regulations specific to the operation of the Premises.

ARTICLE 18 - VACATION OF PREMISES

The Tenant shall hand back the Premises in a proper state of repair and shall
pay the cost of any repairs required under the terms and conditions set out in
Article 6.6.1 above.

18.1     EXIT INVENTORY

An inventory and inspection of the Premises shall be carried out by a bailiff,
the cost of which shall be shared equally by the Landlord and Tenant, no later
than the Lease expiry date or the effective date of the Tenant's departure, if
different.

18.2     ACCESSORIUM SEQUITUR PRINCIPALE - REPAIRS

The Tenant's obligation to pay the rent shall not cease until the day on which
the Premises are handed back in their entirety with vacant possession and empty
of all furniture, production machines and associated hookup. The Tenant shall
further undertake to continue paying the rent in the event that repair works are
to be or are being carried out as validly required by the competent authorities
in the case of discontinuation of a hazardous classified activity previously
conducted by the Tenant, to the extent that the Landlord is unable to re-let the
Premises during such period.

All fixtures, fittings and improvements (including any cable networks and
moveable partitions existing as of the date hereof) made by the Tenant prior to
the date hereof or during the term of the Lease shall become the property of the
Landlord by way of accessorium sequitur principale upon the Tenant's vacation of
the Premises, without compensation.

Notwithstanding the foregoing, the Landlord may at its discretion ask the Tenant
to remove at the Tenant's own expense all fixtures, fittings and improvements
carried out by the Tenant during the term of the Lease, save where the Landlord
has waived such right at the time of authorising said fixtures, fittings and
improvements.

Should the Tenant fail to carry out the repairs and removal works within the
requisite time period or should the Tenant fail to respond to the Landlord's
notice to do so served by bailiff, the Landlord shall have the amount of said
repairs and works quantified by its architect and the Tenant shall pay such sum
without delay and shall be discharged from its obligation to carry out said
repairs and works.

ARTICLE 19 - AMENDMENTS - TOLERANCE

Any amendment hereto shall be made in writing either in the form of a
supplemental agreement entered into by both parties or by an exchange of
correspondence.

Amendments shall under no circumstances be deemed to have been made either
following the Landlord's failure to respond to any correspondence or to the
Landlord's tolerance of a

<PAGE>

change in terms and conditions regardless of the frequency or duration. The
Landlord shall at all times remain free to demand strict compliance with the
provisions of the Lease where there has been no express written amendment.

ARTICLE 20 - LESSEE'S FAILURE TO COMPLY WITH UNDERTAKINGS - TENANT'S DEFAULT -
PENALTIES

20.1     It is expressly stipulated that should the Tenant fail to make a
payment of rent or occupation indemnity and/or other sums on the due date or
should the Tenant fail to comply with one of its significant undertakings
hereunder or with the provisions of the law or a court order, where such failure
has not been remedied within one month of receiving a simple order to pay or
perform, the Landlord may choose to terminate the Lease ipso jure.

The Tenant may then be evicted upon simple order delivered by the President of
the Paris Tribunal de Grande Instance, who need only establish the occurrence of
default, said order being binding immediately.

20.2     Should the Tenant fail to comply with one of its undertakings, and more
specifically its undertakings with respect to maintenance and repair works, and
such failure has not been remedied within fifteen days of receiving notice
thereof from the Landlord, the Landlord shall, independently of the option to
terminate the Lease in accordance with the provisions of 20.1 above, have the
right to appoint a contractor of its choice at the expense, risk and loss of the
Tenant. The resulting costs shall be added ipso jure to the next rent payment.

Should the Tenant fail to pay any sum due under the Lease on the due date for
which notice has been duly sent by the Landlord, penalty interest shall be
applied ipso jure with effect from the due date at the legal base rate
prevailing at the time plus 150 percentage points, with no requirement for
further notice and without prejudice to application of the default clause
referred to above.

Should the Lease be terminated pursuant to the provisions of this Article, the
Landlord shall retain the security deposit as compensation, without prejudice to
any other rights or remedies available to it under the provisions of Article
1760 of the Code Civil.

Should the Tenant fail to vacate the Premises after termination of the Lease for
whatever reason or upon expiry of the Lease, the Tenant shall ipse jure be
charged an occupation indemnity hereby fixed at the sum of the current rent plus
50% for each day of delay, without prejudice to any other rights to damages
which may be available to the Landlord.

ARTICLE 21 - ADDRESS FOR SERVICE

All notices and other correspondence sent under this Lease and any subsequent
agreements arising therefrom shall be deemed to have been validly made when
addressed to the parties at their respective head offices.

ARTICLE 22 - CHOICE OF LAW AND JURISDICTION

This Lease shall be governed by the laws of France. Any dispute shall be
referred to the exclusive jurisdiction of the courts in the place where the
Premises are situated.

<PAGE>

ARTICLE 23 - SUBROGATION OF LESSOR

Should the Landlord, either during the term of the Lease or during any extension
thereto, legally transfer title to the Premises to a third party, whether a
natural person or body corporate, that third party shall automatically be
subrogated in the Landlord's rights and obligations under the Lease. Such
subrogation, which the Tenant hereby accepts, shall not lead to novation of the
Lease.

Signed and delivered in Paris
on 1 August 2003
(in triplicate, each party acknowledging
receipt of one copy)

/s/ JEAN-PIERRE BARON                                       /s/ PHILIPPE BREGI

Societe Immobiliere Villarceaux-Nozay                       Avanex France
Jean-Pierre Baron                                           Philippe Bregi

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