Esmertec Investors Convert 81 % of Convertible Bond to Equity - Esmertec Strengthens Balance Sheet and Lays Foundation for Future Growth

Esmertec™ (SWX:ESMN), announces today that bondholders representing 81 % of the face value of Esmertec’s outstanding convertible bonds have accepted the company’s offer for "early conversion” of the bonds at a conversion price of CHF 10.00 per share. As a consequence, on 31 December 2007, Esmertec’s debt will be reduced by CHF 30 million, shareholders equity will increase by the same amount and future cash outflows will be reduced by CHF 39.7 million. The success of the transaction is subject to shareholder approval of an increase of additional conditional capital in the nominal amount of CHF 92,096.60, representing 920,966 new shares leading to a dilution of 4.2 % (of issued share capital plus conditional and authorized capital as per the Articles of Incorporation). The invitation to the Extraordinary General Meeting (EGM) which will be held December 6th, 2007 to decide on the increase in conditional capital was sent out November 16th, 2007. Approval of the proposal will complete Esmertec’s turn-around from a financial perspective. Esmertec confirms its outlook for 2007 of reaching revenues of USD 35.5 million, a positive cash flow from operations and a positive gross margin in the service business. After reaching these milestones Ruedi Noser, has decided to hand over his position as Chairman and to step down as Board member at the next Annual General Meeting (AGM) to be held on May 15th, 2008 and to focus his activities on the Noser-Group. The Board of Directors has decided that Hans Peter Baumgartner, Board member of Esmertec since November 2006, shall be his successor. Hans-Ulrich Müller, Vice-Chairman of the Board of Directors commented: "The "early conversion” of the convertible bond will give the company the financial flexibility to support its excellent market position going forward. We expect the company to show sustainable growth and profitability improvements. Ruedi has done an outstanding job. The Board of Directors regrets Ruedi’s decision and expresses its gratitude for his work. At the same time we are pleased that Hans Peter Baumgartner has accepted to take over the Chairman role. Due to his industrial background and experience as Board member of Esmertec Hans Peter Baumgartner is the ideal candidate to ensure a seamless handover and a successful development of our business.” As of the next AGM on May 15th, 2008, Esmertec’s Board of Directors is expected to consist of the four current Board members Hans Peter Baumgartner, Michel Bon, Hans-Ulrich Müller, and Jean Schmitt as well as Jean-Claude Martinez, current CEO of Esmertec, who stands for election as new Board member. Jean-Pascal Aubert will not stand for re-election. About Esmertec Esmertec is a focused provider of software and services to communications device manufacturers and mobile telecom operators. The company provides software platforms that enable the deployment of content and applications in devices and over servers. Customers include mobile telecom operators and manufacturers of mobile handsets, set-top boxes and interactive televisions. Esmertec's software and service capabilities excel with their reliability as well as fast and local execution. Founded in 1999, Esmertec is headquartered in Zurich, Switzerland with subsidiaries in China, France, Japan, South Korea, and the USA, and offices in Taiwan and the UK. Since 2005, Esmertec is listed on the SWX Swiss Exchange (ESMN). Esmertec is a founding member of the Open Handset Alliance. www.esmertec.com Esmertec and Jbed are trademarks of Esmertec AG. Java is a trademark of Sun Microsystems Inc. Other company, product and service names may be trademarks of their respective owners