Caesarea, ISRAEL, February 20, 2007 - ColorChip, a leading manufacturer of glass- based Planer Lightwave Circuit (PLC) chips and modules for the Fiber To The Home (FTTH) networks, today announced that it has completed a $7.4 million funding led by Vertex Venture Capital joining existing investors including Bessemer, Eurofund , Motorola , Polytechnos and Walden Israel Venture Capital.

According to Moshe Price, CEO of ColorChip, the proceeds will enable the company to move from product qualification phase to mass manufacturing to accommodate the strong FTTH market demands in the U.S, Japan, Asia Pacific and recently Europe. It will be also used for introducing new products targeting additional applications.

Moty Ben-Arie, Managing Partner at Vertex Venture Capital says, “The evolvement of the telecommunication and data communication environment creates demand for new optical components that enable high bandwidth with relatively low cost. ColorChip’s distinctive technology is an excellent platform for such components. We have strong faith in the company and its potential to seize a major share of the market.”

Moshe Price says, “We are happy to have Moty Ben-Arie on our board as we value his experience and appreciate his contribution. We are confident that Vertex with their strong relationships in Asia will help us further penetrate the Asian markets.”

The company has recently launched its Meteor II FTTx SOG™ Transceivers for optical network terminals (ONT/ONU) for GPON and EPON, which customers are currently sampling. ColorChip has also released the “Spark” product family of high performance PLC splitters mainly to the FTTx, CATV, analog and digital PONs markets.

ColorChip was awarded the Frost & Sullivan Award for 2006 Optoelectronic Components Emerging Company of the Year Award. The award is presented each year to the company that has demonstrated excellence in all operations within the Optoelectronics Industry including the company’s business development, competitive strategy, and leadership.