Letter to the Shareholders of Patriot Scientific Corporation from President/CEO Rick...

Letter to the Shareholders of Patriot Scientific Corporation from President/CEO Rick Goerner on Business Update

CARLSBAD, Calif.--(Business Wire)--
To all shareholders and stakeholders of Patriot Scientific
Corporation (OTCBB: PTSC), this letter provides an update on
significant business activities at the Company. I am committed to
facilitate regular communication to Patriot Scientific's shareholders
through these letters to provide additional insight on topical
business issues and to provide a uniform status report on important
activities at the Company.

The Company will conduct its annual meeting next week, and I will
summarize details of that meeting to all shareholders after it is
over, however, in keeping with my theme of regular communication, I
wanted to provide a brief update on Patriot's business activities and
address a few issues prior to the meeting. In this letter I will focus
on three topics: 1) a brief update on activities to expand Patriot
Scientific's future business prospects, 2) plans for the upcoming
Annual Shareholder Meeting and proposals seeking shareholder approval,
and 3) comments on some recent issues raised by shareholders.

Update on Activities to Position Patriot Scientific for the future

The key theme of Patriot's evolving M&A strategy is to leverage
our current capital resources (cash and stock), and the future
earnings generated from the company's MMP(TM) Portfolio interest, into
a viable growth-oriented operating company. Patriot Scientific has a
strong balance sheet. Our favorable cash position and trading
liquidity are attractive to many companies (both public and private)
seeking cash to grow. In fact, current market conditions can be viewed
as a "most opportunistic" time to acquire valuable business assets to
build long term shareholder value.

The Crossflo Systems acquisition, closed September 1, represents
Patriot Scientific's first full M&A transaction. Crossflo's unique
data sharing software tool addresses a complex, widespread, and
fundamental challenge to meeting the government's widely publicized
"Connect the Dots" objective. These requirements are certainly evident
in Homeland Security (National Fusion Centers), law enforcement and
healthcare (fueled by recent Congressional legislative changes). Each
of these markets represents multi-billion dollar revenue opportunities
for database integration software. As I reported in my last letter,
despite the early and developing nature of this new public sector data
sharing market, Crossflo has demonstrated benchmark revenue projects
in each of these sectors.

We are excited to note that Crossflo's technology and logo are
highlighted with Hewlett Packard's (HP) Integrity Non-Stop server
technology on its healthcare solutions website as a partner for HP's
healthcare initiative. Crossflo and HP are actively involved in
several pilot healthcare projects that could grow into multi-million
dollar initiatives connecting hospitals, physicians groups, and other
medical service providers. With HP as a partner we are confident that
we can increase Crossflo's market presence and accelerate revenues in
the healthcare sector.

HP web link:
http://h71028.www7.hp.com/ERC/downloads/4AA0-6005ENW.pdf

Additionally, Crossflo has expanded its healthcare product
offering to include a solution from a company called Iameter to bundle
Iameter's "quality of care" data analysis software for healthcare
applications. Iameter has provided, for several years, a healthcare
software platform for hospitals and physician groups to assess the
quality of care delivery against state and federal healthcare
standards to help them realize quality improvements and reduced cost.
Iameter's solutions have recently become important to healthcare
providers because Medicare has just announced that for the first time
quality of care will now affect the amounts healthcare providers are
reimbursed for services provided to Medicare patients. This
fundamental change in the nation's largest healthcare reimbursement
system makes Iameter's technology a timely and compelling addition to
Crossflo's data sharing technology. Iameter's software product and
services are now being offered as components of the HP-Crossflo
"Health Information Solution." As we believe Iameter's product is very
synergistic with Crossflo's, Patriot has executed a Memorandum of
Understanding to acquire the assets of Iameter, merging their
resources into Crossflo before year-end if the transaction is
finalized.

We had planned to file historical and proforma financial
statements for Crossflo with the SEC in conjunction with our recent
10-Q filing, but the finalization of certain tax structure issues for
the transaction have caused a delay in creating the required financial
reports. We fully expect, however, to meet or beat the November 17,
2008 SEC filing deadline. At the shareholder meeting, I will outline
plans moving forward to increase revenues and profits based on Patriot
Scientific's ability to provide additional capital resources to drive
the Crossflo business. Crossflo management will also be available at
the meeting for questions.

With Crossflo's data sharing tools as the core, we are continuing
to evaluate other opportunities to acquire complementary software
products with specific emphasis on healthcare and government/law
enforcement applications. We expect these activities will help
Crossflo to better capitalize on these emerging opportunities by
broadening and accelerating future customer engagements and revenues.

Annual Shareholders meeting and proposals for shareholder approval

As you are now aware, our annual shareholder meeting will be held
in Carlsbad, CA on October 30, 2008 at 10:00 am. I am looking forward
to a productive meeting and to meeting many of the Patriot
shareholders. We will be conducting the formal shareholders business
meeting promptly at 10:00 am with a brief business overview and Q&A
panel to follow to address specific inquiries.

I wish to bring to your attention two of the proposals which have
been put before the shareholders for approval:

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1. Increase the 2006 stock option plan by 5 million shares
(approximately 1.2% of the outstanding shares).
2. Increase the authorized shares from 500,000,000 to
600,000,000 shares.

*T

Both of these initiatives are a consequence of our M&A efforts.
The first proposal addresses the need to provide a means to attract,
retain and motivate employees, primarily new Patriot employees. A
consequence of a successful M&A effort is increased employee
headcount. As we become more established as an operating company in
the technology sector, we will need to provide for employee incentive
stock options that are customary for companies like Patriot. For
example, closing the Crossflo transaction, increased Patriot's
headcount from 4 in January 2008 to more than 25 today. I could
project 45 to 50 or more employees by mid-2009, and Patriot simply
does not have sufficient option shares available to provide for our
existing and planned new employees. Patriot's current option pool
represents less than 3% of the shares outstanding. Our motion
increases this percentage to less than 4% of the outstanding shares,
still very far below the average for technology companies.

The second proposal is to provide adequate "currency value" with
which to enable Patriot's management and Imperial Capital, Patriot
Scientific's investment banker, to continue to pursue M&A discussions
with other potential operating companies (both public and private).
Particularly in this weakened market, we believe these additional
shares will be critical to realizing value from our ability to pursue
attractive operating entities capable of increasing Patriot
Scientific's market capitalization. We are building momentum with our
M&A pursuits and have several very interesting companies with whom we
are in discussion. I urge that you consider a favorable vote on this
proposal.

Management and the Board of Directors are seeking your approval
for these two proposals to continue to have the tools to execute our
M&A plans for future growth and profitability. As an increasing number
of brokers today will not vote your shares on your behalf, it is
extremely important that all shareholders actively vote their shares
for these initiatives to pass.

Comments on other shareholder inquiries

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1) Update on USPTO actions on MMP(TM) patent re-examinations
2) Questions regarding a reverse split of Patriot shares
3) What are we doing to increase the awareness of Patriot's
story (IR update)

*T

1) Update on USPTO actions on MMP(TM) patent re-examinations

I have stressed the fact that the patent re-examination process is
a very complicated and lengthy process. Patent Office actions are
publicly disclosed, and we look forward to the final actions by the
USPTO. Both Patriot Scientific and TPL are involved in litigation
regarding the patents, and comments regarding the status of the
various patent re-examinations and patent office actions cannot be
made at this time.

TPL/Alliacense continues, however, to engage new licensees as
evidenced by the new MMP(TM) licenses announced with Rockwell
Automation and Respironics.

2) Questions regarding a reverse split of Patriot's shares

Several shareholders have expressed concerns on both sides of this
question, namely:

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a. We hope that you are not contemplating a reverse split that
could potentially be a short term fix to our weaker share
price, but often has negative long term impact on a company's
market cap and,
b. When will Patriot reverse split its shares to pursue a
listing on a more broadly traded exchange with access to
additional investors and financial institutions precluded from
trading in OTC shares?

*T

Patriot's management and the Board are keenly sensitive to the
concerns of the shareholders on both sides of this question and will,
together with our legal and financial advisors, including Imperial
Capital, continue to evaluate this issue. There is no current
discussion to pursue a reverse split at this time, but two scenarios
would likely trigger the consideration of this action: a larger M&A
transaction with a strong revenue, profit and market perspective
and/or a reverse merger of Patriot into a current public company
trading on another exchange.

I believe that it will be in the best interest of shareholders
long term to seek listing on a more broadly traded exchange, but do
not feel that current business conditions warrant active pursuit of
this goal today.

3) What are we doing to increase the awareness of Patriot's story
(IR update)

In mid-summer we changed the Company's public relations (PR) and
investor relations (IR) strategy bringing on Ibis Consulting,
announcing the plans for internal IR support to complement Ibis's
efforts and move PR in a different direction. We believe that those
efforts have been well received and are operating very effectively
today. I have received numerous shareholder comments on Angela Hartley
and her professional handling of shareholder inquiries.

Further, it is imperative to grow awareness of Patriot among new
potential investors. Toward that end Ibis has driven a very proactive
program of potential new investor meetings and financial conference
participation on a broad front. Since early September I have met with
potential investors in New York City (twice), Los Angeles, San Diego,
Orange County and Florida. I recently attended the FSXone conference
on Fort Lauderdale, where we had the opportunity to meet one on one
with new potential investors, present the Patriot story to a large
group of interested broker/dealers and investors and even got a five
minute spot on a national radio business show (American Scene Radio
with Steve Crowley).

Additionally, before year-end I am planning to be in New York City
again for new investor meetings and the Paulsen Conference (November
12). Ibis is coordinating a European road show for early December and
San Francisco in November. I expect to spend a minimum of a third of
my time positioning the Patriot story with new potential investors.

In these troubled times for the market, Patriot certainly cannot,
and should not control the price of our shares, however, we can insure
that we extend our best effort to increase the awareness of Patriot's
evolving story and let market forces take it from there.

As always, it is my objective to continually improve the quality,
uniformity and responsiveness of our communications to shareholders
and the marketplace, and I will continue to look forward to your
comments and inquiries.

I trust this letter has provided you with additional information
regarding the status of key business initiatives at Patriot Scientific
and the progress we are making toward building a "new Patriot" with
solid future growth and profitability.

I'll look forward to meeting many of you at the upcoming
shareholder meeting.

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Sincerely,

Rick Goerner
President/CEO
Patriot Scientific Corporation

*T

Safe Harbor Statement under the Private Securities Litigation
Reform Act of 1995: Statements in this news release looking forward in
time involve risks and uncertainties, including the risks associated
with the effect of changing economic conditions, trends in the
products markets, variations in the Company's cash flow, market
acceptance risks, patent litigation, technical development risks,
seasonality and other risk factors detailed in the Company's
Securities and Exchange Commission filings.

Moore Microprocessor Patent (MMP) and Alliacense are trademarks of
Technology Properties Limited (TPL). PTSC is a trademark of Patriot
Scientific Corporation. All other trademarks belong to their
respective owners.

Full information regarding the Annual Shareholders meeting and
proposals for shareholder approval can be found in Patriot's
definitive Proxy Statement for the 2008 annual meeting of shareholders
filed with the SEC on September 22, 2008, and the Patriot's Annual
Report on Form 10-K for year ending May 31, 2008, filed with the SEC
on August 14, 2008, as well as Patriot's Quarterly Report on Form 10-Q
for the period ended August 31, 2008, filed with the SEC on October
10, 2008, all of which are available on Patriot's website at
www.ptsc.com, or at www.sec.gov.

Patriot Scientific
Angela Hartley, 760-547-2700 ext. 102

Copyright Business Wire 2008