Signature Devices Inc. (SDVI)

[FrankF]

The Issuer’s Business, Products and Services https://backend.otcmarkets.com/otcapi/company/financial-report/228076/content
Signature Devices is focusing on the Mobile applications and Internet of Things business and with acquisition of Nano 101
on the hemp-based topical space.
Signature Devices Fiscal Year is Jan 1 – Dec 31.
Our Primary SIC code is 7372 – Prepackaged Software and the Primary NAICS Code is 511210
Industry Overview
The last twelve months of Internet of Things (IoT) forecasts and market estimates reflect enterprises’ higher expectations for
scale, scope and Return on Investment (ROI) from their IoT initiatives.
According to Statista, the global Internet of Things (IoT) market is projected to grow from $2.99T in 2014 to $8.9T in 2020,
attaining a 19.92% Compound Annual Growth Rate (CAGR). Industrial manufacturing is predicted to increase from $472B
in 2014 to $890B in global IoT spending. Healthcare and life sciences are projected to increase from $520B in 2014 to $1.335T
in 2020, attaining a 17%
GrowthEnabler estimated that the global IoT market will grow from $157B in 2016 to $457B by 2020, attaining a Compound
Annual Growth Rate (CAGR) of 28.5%. According to GrowthEnabler & Markets and Markets analysis, the global IoT market
share will be dominated by three sub-sectors; Smart Cities (26%), Industrial IoT (24%) and Connected Health (20%).
Followed by Smart Homes (14%), Connected Cars (7%), Smart Utilities (4%) and Wearables (3%).
Bain predicts B2B IoT segments will generate more than $300B annually by 2020, including about $85B in the industrial
sector. Advisory firm Bain predicts the most competitive areas of IoT will be in the enterprise and industrial segments. Bain
predicts consumer applications will generate $150B by 2020, with B2B applications being worth more than $300B. Globally,
enthusiasm for the Internet of Things has fueled more than $80B in merger and acquisition (M&A) investments by major
vendors and more than $30B in venture capital, according to Bain’s estimates.
With the advancement of hemp extraction technologies, the worry of being exposed to THC (tetrahydrocannabinol), the
psychoactive component of the hemp plant, has diminished greatly. This has paved the way for usage of hemp plant
components such as Cannabidiol (CBD) and other non-THC phytocannabinoids to be used therapeutically without any
deleterious side effects for the user.
As such, the overall hemp/cannabis industry has experienced continued growth the past few years. The industry is primed for
robust growth in the coming years especially with the growing legalization of the plant across the globe. This is especially
true in the United States with the recent passage of the Farm Act in 2018 which now classifies the hemp plant as a commodity
and legalizes use of hemp plant derivatives such as CBD and CBG (cannabigerol).
Cannabis Business Plan predicts that the overall cannabis market will reach $24.5 billion by 2021 in North America alone for
adult use and medical purposes. By 2027 this amount is expected to grow to $47.3 billion. The CAGR during this period will
reach close to 28%.
Grand View Research projects the global Cannabis market to reach 146.4 billion USD by 2025 with a CAGR of 34.6% during
the forecast period.
We can also look specifically at the Cannbidiol market. According to the Brightfield Group report, with the passing of the
2018 Farm Bill, the Cannbidiol (CBD) market is expected to hit $22 billion USD by 2022. Analysts at Technavio expect the
CAGR to be a little above 31% during this period. With continuing global legalization and acceptance of hemp and its
derivatives, the future looks bright for the global CBD oil market. Demand is especially strong among millennials and younger
generations who are more open to alternative hemp based therapies.
Corporate Overview
Signature Devices, Inc. (www.signaturedevices.com) (OTC PINK: SDVI) is a holding company with subsidiaries that develop
Internet of Things (IOT) products through its subsidiary Signature Devices Technologies, Inc.
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Our subsidiary, Signature Devices, combines the best of the technologies underpinning the popular Morpheus media server,
Tazerwear's AI Software, Truck IT's beacon platform with Knoton's hardware, infrastructure and software. The result is a
company that blends custom software and powerful hardware IoT-interconnected devices. Learn more by
visiting: http://Signature Devicestech.io/about/
Signature Devices is a leading software and hardware development company focusing on the Internet of Things (IoT). Four
companies were acquired by Signature Devices, Inc. to form a new entity called Signature Devices. Signature Devices
develops and manufactures devices for digital home media management under its Morpheus brand, location beacon and
notifications under TruckIt, and IoT hardware under its Knoton brands. The acquired entities are used to create a connected
platform for the Internet of Things. The closing date for the transaction was February 1, 2017. Two of the four companies
have revenue.
Signature Devices blends custom software and powerful hardware to create IoT-interconnected devices. Signature Devices
combines the best of the technologies underpinning the popular Morpheus media server; Knoton’s innovative hardware
designs suitable for internet of things, home automation and GPS enabled devices; Truckit’s beacon platform with Artificial
Intelligence based video analysis software.
The Signature Devices Platform is composed of Hardware and Software. The Hardware is designed to be extremely high
quality. Some of the hardware is proprietary to Signature Devices. The software is developed in-house and licensed from third
party and then integrated into a single platform. The in-house developed hardware and software is also a candidate for potential
patents.
Based at 2091 Business Center Dr, Irvine, CA 92612, Signature Devices, Inc. combines the best of the technologies
underpinning the popular Morpheus media server, Tazerwear's AI Software, Truck IT's beacon platform with Knoton's
hardware, infrastructure and software. The result is a company that blends custom software and powerful hardware IoTinterconnected devices.
With Signature Devices merger acquisition of Nano 101, the company has now entered the burgeoning hemp space, that with
passage of the 2018 Farm Act, is primed for robust growth in the coming years across the globe. The major hemp derivative
that is expected to see the greatest growth is CBD (Cannabidiol) which provides a variety of therapeutic benefits without the
deleterious psychoactive effects of THC (tetrahydrocannabis). Nano 101 has tapped into this CBD market by developing the
most powerful CBD topical patch system. In addition, by Q2 2018 Nano 101 introduced its Hemp patch product line.
Current Products
• Morpheus
Morpheus Media Servers and Players give consumers a high-end media repository that integrates nicely with
products like the Apple TV and Roku as well Morpheus’s own dedicated ExHBR® players. Morpheus offers multiple
solutions which are currently sold to distributors and installers. Signature Devices is focusing on producing a direct
to consumer version of the product, which is already in beta. The Morpheus servers have been proven in the
marketplace and sold to customers in Asia, Europe, South America, North America and the Middle East. The
company has generated over $300k in product sales with minimal fanfare. The global market for home media servers
is projected to reach $200 billion
Morpheus as a platform supports ExHBR (Extreme High Bit Rate) streaming for the high-quality streaming and Ultra
High Definition (4K) content. Morpheus’s new products already support 4k, the new standard in media resolution.
Morpheus competitive advantages
1. Designed for consumers with easy install and setup wizards
2. It’s compact in size and relies local storage
3. It’s based on Extreme High Bit Rate Technology (ExHBR) - High Quality / High performance / High
reliability
4. Standalone or integrate into existing home automation and security systems
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5. The client & server architectures are optimized & specifically configured for High Definition Audio & Video
delivery
• Knoton
Knoton is the division responsible for blockchain based IOT devices with supporting software to be used for many
IOT based products. The portable device can be used for tracking one’s health, a pet’s location, a child tracker, smart
home automation and other IOT services. The modular platform enables hardware developers to develop their own
products using a library of sensor covering health, lifestyle and security. The IoT devices market was valued at $157
billion in 2016 and is projected to be at $475 Billion by 2020. The Knoton product line uses AI based software for
smart object recognition and applies those algorithms to sensors and beacons to create events and notifications.
Knoton competitive advantages
The Knoton specifications have been designed to be scalable in architecture. The devices will have several scalable
tiers that share the same exact printed circuit board, enclosure, and industrial design. This will save Signature Devices
significant costs in manufacturing. The Knoton adoption is predicted to be very high; the use-cases are many but
here are the ones we are pushing for currently:
1. Child tracking and Geo-fencing. By utilizing the built-in L5 signal based GPS, motion and ambient sensors,
and proprietary circuitry, the Knoton can react to several scenarios that can protect, track, and interact with the
child. It is like having a security team with the child watching for any event that can cause any harm to the
child. The Knoton is a family bodyguard.
2. Personal emergency alert and notification system. Anyone can carry the Knoton; in the event of an emergency,
the person carrying the Knoton can activate a variety of alarms, messages, audio/video recording, and 911-911
shortcode messages with a press of a button (or a predefined interaction modes such as shock). The Knoton is
a personal safety device.
3. Location identification through GPS and Camera (identified on Google map for immediate navigation). The
data sent by the Knoton contains location data, SMS data, cellular data, voice, and video as defined by the
user. The Knoton is a multipurpose beacon.
4. Facial recognition of registered perpetrators (such as sexual predators and offenders). The Knoton views the
area surrounding the user looking for faces (by default). These faces are continuously sent to a backend server
that uses AI to identify these faces based on newly developed algorithms and alert the Knoton carrier (as in a
law enforcement officer or soldier) or parents as in baby or child tracking/monitoring based on predefined
criteria. The Knoton is a child safety device.
5. Infant monitoring and prevention of flip induced sudden death syndrome. The Knoton can be used at home to
monitor infants. The infant images are analyzed locally (on the Knoton platform) to produce the fastest
reaction time to the infant flipping on their face and prevent flip induced sudden death syndrome. The Knoton
is designed to save lives.
6. Home automation (with the use of the included Wi-Fi connectivity). The Knoton can be used in a home/office
Wi-Fi network to act as realistic switches to perform automated tasks such as lighting control, scenario
automation, shades control … etc. The Knoton is a device for easy living.
7. Silent alarm applications. The Knoton’s extreme connectivity flexibility enables enterprises, banks, retail
places, homes, and any place where a silent alarm is needed to have a silent alarm virtually anywhere needed;
inside a drawer, under a desk, inside a walk-in fridge … etc. The Knoton is an always-on alert device.
8. Military application as a solder wearable device for automatic identification of known and registered terrorists
and criminals. The Knoton can identify terrorists in a battlefield making soldiers even safer from silent
attackers. The military grade Knoton is an extremely powerful asset a solder can have; being able to identify a
terrorist between groups of people is tactically crucial for the survival of the soldier. The Knoton is the shield
in the battlefield.
9. Easy setup via Bluetooth. The Knoton has a truly unique method of setting up. Nevertheless, it is easy and
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intuitive. Using Bluetooth, the user can graphically (easy) setup their Knoton to be in the mode they require.
The software takes the user input and translates it into a detailed setup internally customized for the Knoton.
The Knoton speaks visual languages.
10. All day (24 hour) operation via a rechargeable battery through a USB type C connector. The Knoton is truly
mobile.
11. The Knoton is also one of the first IoT devices to be a blockchain device that can verify and securely validate
any transaction as well as be future proof to implement a truly decentralized connectivity ecosystem. This
device will be a first in the IoT cryptocurrency and cryptography on the go ecosystem. The Knoton is in the
chain.
• TruckIt Application
TruckIt is a beacon platform provider for the food truck industry based on Knoton Technology. The beacon
technology simplifies the communication process between the food truck operator and its consumer with the simple
touch of the button by creating geo-fenced push notifications via sms, phone calls, email or social media. With 100
beacons in the market currently, TruckIt is poised to be the clear leader in 12 to 18 months after its launch. The Food
truck industry is expected to generate $2 billion dollars in revenue in 2017 powered by 10000+ trucks.
TruckIt competitive advantages
The TruckIt mobile app along with the Knoton are a first to market and ideal marketing toolset for food trucks,
retail stores and restaurants to market in real time via sms, social, voice and app notifications to their customers.
• Nano CBD Patch
The 120mg Nano CBD patch from Nano 101 is the flagship topical Cannabidiol patch the company first launched.
Prior to its release quite a bit of research and was done on the optimal topical system to use. The result was a
proprietary technology developed in-house. Legalization of hemp derivatives across the globe, especially in the
United States with the Farm Bill of 2018, make it an ideal time to introduce a new system of CBD delivery than
standard oral preparations (edibles, vapes, etc). The CBD market, which is the largest portion of the overall
Cannabis/Hemp market, is expected to hit $22 billion in the US alone by 2022.
Nano CBD Patch competitive advantages
1) Next generation topical technology. The Nano CBD patch represents the next evolution in topical delivery
systems. Prior to its introduction many topical patches utilized a central reservoir system which was often
bulky and had less than ideal effectiveness. The result was an uncomfortable patch that delivered only a
fraction of the contents in the central well area. An upgrade to the topical patch was introduced in the mid2000s with the topical layered and topical direct systems. Nano CBD patches utilize 5 technologies in one
patch developed in-house. Several patents are in the initial planning stage based off these set of technologies.
The Nano-Vive technology allows us to extract the dry equivalent weight of the CBD, or any other soluble
ingredient, and create a nano particulate pre-infusion matrix that can be placed onto the patch. No messy or
bulky central reservoir is required. The patch provides full potency of the infused ingredients.
2) Extended delivery time. In addition to providing full potency of the dry equivalent weight, the CBD delivery is
over an extended period of time. The window is between 8 to 12 hours for most users. This provides more long
term delivery than oral CBD preparations. A large portion of the CBD contained in oral products gets
inactivated by digestive processes before entering the blood stream. Furthermore these products produce an
initial surge of CBD then a drastic drop. Topical CBD oil rubs are also highly inefficient and only a small
fraction can penetrate the skin in such a viscous format. Nano CBD delivers more stable and long term CBD
without any surge or drops.
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3) Convenient and Simple. Because it is particulate in nature we are able to pack the full potency of the CBD
dosage in a much smaller size than traditional topical patch systems. Our patches are only 1.25” x 1.25” and
are very slim as well as discreet. Many users have reported feeling as if nothing is there. Whereas most oral
preparations and oils must be taken several times a day, because of the extended period of delivery, only one
patch is needed for the day for most users.
4) Comfortable. The patch utilizes a surgical grade adhesive backing that feels light weight and is comfortable to
wear up till 24 hours. Many of the older topical patch systems would start to irritate and chaff the skin after a
few hours. Nano CBD patch is easy to apply and also very easy to remove with no pain. The slim design
provides lasting comfort during duration of use.
5) Customization. The Nano CBD Patches can be easily cut with scissors to customize dosage. While we have
found 120mg to be the ideal amount for 8+ hours of delivery, some users may in fact require more for their
needs. The user can easily add half a patch or even another whole patch to deliver 240mg. The slim design
makes for easy cutting of the patches if the user wishes to customize the dosage of CBD.
6) High quality. Of primary importance has been the cultivation and extraction of hemp derivatives from the
highest quality hemp plants. Our hemp plants are grown in the world renowned hemp plant belt in Oregon. All
plants are grown in a pesticide and toxin free environment, ensuring that the extracted CBD oil is pure and free
of extraneous toxic solvents.
7) High competitive price point. The patches have the highest dosage of any other competitor on the market and
are made in the USA using the finest quality materials. With our production capabilities we are able to price
them far below the nearest competitor. As an example previously discussed Marys Medicinals offers a 10mg
patch with older patch technology at $10 for a 10mg patch. 6 such patches would be around $60. Nano 101
Technology is able to sell at retail 6 120MG patches for only $48 USD. Nano 101 Technology is primed to
offer the most advanced CBD and hemp topical systems at a price point unbeatable by other patch
manufacturers.
Pure Hemp Patch
The 75mg Pure Hemp patch was launched during Q2 2018 and is 2nd in the Nano 101 Technology topical patch line. It
offers all the competitive advantages that Nano CBD patch offers but is infused with a different pre-infusion matrix rich
with hemp derived phytocannabinoids and terpenes.
Competition
Morpheus’s competitors are Kaleidescape, Imerge, and VidaBox. Both are U.S. based companies with an established
product offering. However, they operate at different price points with Kaleidescape and Imerge on the higher end of the
price range (as high as $25,000) and VidaBox in the same target tier for Morpheus ($1,000SRP).

Knoton – The IOT market currently doesn’t have a device similar to the Knoton, nor do devices like the Apple watch have
specialized apps to equal the functionality of the Knoton. The projected price per device will be in the range of $149-$199.
TruckIt – The only marketing programs available for the Food Truck industry are the traditional print. The pricing model will
be subscription-based in the range of $20 a month
While the CBD space is expected to be flooded with a variety of products with the recent passing of the Farm Bill, the topical
space is currently very limited in terms of competition. The conversion of CBD into a long term 8+ hour delivery patch
requires the infusion of the oil onto a patch matrix of sort. Most of the competitors of Nano 101 technology use a central
reservoir patch delivery system that was first developed in in the 1970s. These systems are often quite bulky and cumbersome
to leave on for extended periods of time. Major competitors in this arena include Marys Nutrionals, Pure Ratios CBD patch,
and Papa & Barkley’s. These patches utilize a central reservoir and have a lower dose CBD oil infusion. Several of the Pure
Ratio patches are also intermixed with THC. Nano 101 is the first CBD topical company to provide the next generation nano
particulate body heat activated patch system. In addition to providing the next generation delivery mechanism, Nano 101
offers the highest dosage at a far more competitive price. For example a single patch from Marys Nutrionals has 10mg and is
priced at $10. 6 such patches would retail for $60 USD whereas Nano 101 has priced 6 120MG topical patches at $48 retail.
Business Development
Our business development efforts are focused on 4 main areas:
• Release of the newly designed Knoton along with the use-cases and the marketing plan. The Knoton is a
promising device that will take advantage of the ever-growing IoT market. The Knoton will also be designed
to be a secure blockchain IoT device that can be weaved into a complete IoT system. Such device when
deployed in the thousands or millions of units can then form a complete system that can have profound uses
in the crypto-currency and distributed-computation market segment. The IoT market is still in its infancy
and developing fast. The Knoton is designed to take advantage of this large market.
• Revamping our Morpheus line to maintain a cutting edge advantage in the media delivery market. A few of
the upgrades that are planned are an upgrade to the entire line to 4K and the introduction of a Morpheus
device designed for the consumer market rather than just the professional market.
• The TruckIT app will be finalized in the first quarter of 2018 and ready for release. We are currently
finalizing the IOS version.
• We also are planning several marketing campaigns to increase brand awareness and drive sales of Morpheus,
TruckIT and the Knoton. The goal is to increase wide adoption of the Morpheus Line and have a successful
launch for the Knoton along with TruckIT.
• Expand e-commerce marketing for both Nano CBD Plus and Pure Hemp Patch through social media and
other online outlets. With the Farm Bill now passed, we expect social media platforms such as Facebook
and Google to allow marketing of CBD products on their platforms in the near future. This far restriction of
Cannabidiol on these channels has been a major barrier to marketing efforts in the ecommerce space.
• Invest in continued SEO efforts for Nano CBD. Sales growth has been driven primarily through organic
search traffic on Google and Yahoo. Nano CBD ranks high on major CBD related keywords on both search
engines. The company’s SEO focus will be to improve on rankings in the coming year on these and more
major search keywords for both engines.
• Expand digital marketing for the Pure Hemp Patch product line. While CBD may be restricted by the likes
of Facebook and Google, Hemp products are allowed. The coming year will see increased marketing budgets
directed to Google display, Google Shopping, Google Search, and Facebook marketing. Amazon also allows
hemp products and is an online shopping platform that we will target heavily.
• Diversifying product lines under both Nano CBD and Pure Hemp. Passing of the Farm Bill has allayed
concerns with many potential customers. Nano 101 Technology plans on developing topical patches of
varying strengths and sizes to serve the needs of consumers desiring stronger or a lower dosage of CBD oil
in their patches.
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• Nano CBD will also develop a variety of formulations that includes CBD with other natural herbal remedies.
Development has already begin on producing topical systems that may help with certain conditions such as
joint pain or insomnia. This would be the first not only in the topical patch space but in the overall CBD
market which thus far has been restricted to CBD only preparations.
Investment in Growth
During 2018, Signature Devices focused on stabilizing and integrating the technology platform consisting of multiple legacy
systems. With the acquisitions of Signature Holdings, Inc we needed to take a moment to insure all of our technology stack
properly works and is capable of handling the growth we are starting to experience. With the stabilization behind us, we plan
to invest in additional business development resources to drive awareness and adoption of the platform to targeted customers.
We also plan to invest in additional features and technology such as IoT and Media Servers. We also intend to continue
investing in research and development related to further increase our product offering and competitive advantage. The goal of
these development efforts will be to maximize market penetration across our multiple streams of income within the Internet
of Things while improving the user experience.
Signature Devices will take a three pronged investment growth strategy with the acquired Nano 101 property. The first will
be expansion of digital marketing efforts of its Pure Hemp product line. While CBD is still restricted, Hemp labeled products
are allowed for marketing and sale on Google, Facebook, and the Amazon marketplace. With our recent investment in Google
Shopping for Pure Hemp patch, returns have been in the 4x to 5x region of investment. We see high potential to push the
hemp product line on these e-commerce marketing platforms. We have also allocated a significant amount of energy towards
continued research and development especially with our CBD products. With the Farm Bill passing we expect to release a
variety of patches with varying strengths and with custom formulations. Our third strategy is to invest placing our products in
traditional brick & mortar retail stores. Our initial focus is on smaller practitioner’s offices (chiropractor offices, naturopaths,
homeopaths, etc.), wellness centers, dispensaries, vape shops because of easier markets to these distribution channels.
Eventually larger retail spaces will be targeted such as major name pharmacies and retail stores (CVS, Walgreens, Target,
Walmart, etc)
Business Development
Innovo Technology is currently selling through distributors in several countries. In the last 3 years Innovo Technology
has built a solid name synonymous with high quality software and hardware. The current product lines in production is
Morpheus, which is geared towards the professional installers and professional home automation integrators. We will
continue to grow our international distributor base and US dealer base.
SDVI will invest heavily in R&D, grow the current manufacturing relationships to produce its products, and focus on
marketing and selling activities. The company plans on growing USA based operations while increasing its overseas
programming joint ventures.
Our business development efforts are focused on three main areas. The first is expand in the private media server. The
second is focus on providing IoT devices for campus and personal security. The third area of focus is expand the TruckIT
app based on technology by Knoton further into the US market. This translates to revenue generation from selling
physical hardware, providing cloud services and monthly subscription fees.
Business development plans for Nano 101 Technology will take have three goals. Our first goal is to expand on
the ecommerce marketing platforms that are available to use. Even though Google, Facebook, and Amazon our currently
reticent to sponsor CBD products, we can still utilize other digital commerce channels to market the patches. While
organic traffic alone has been quite extraordinary in terms of sales, a heavy investment in avenues that will allow CBD
would be a huge bonus.
We will also continue to push Pure Hemp patch through Google, Amazon and Facebook as Hemp related products are
permitted. Recent marketing campaigns, in particular Google shopping, have been a huge plus for us with 4 to 5x
returns. The dearth of hemp patches on Amazon is also a big competitive advantage.
Finally, we will have continued research and development in expanding our topical product lines. We expect to have
patches of varying strengths and sizes. For example we have plans of a larger sized patch that utilizes our next
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generation technology, with double to triple the dose of CBD. We also have lower strength CBD topicals in the
planning stage. One of the most exciting aspects of our research is in the development of CBD infused formulations
with other herbal ingredients to create patches to possibly treat different symptoms such as joint pain, insomnia, and
anxiety.
This coming year will also see a heavy push for us to infiltrate the retail space. We have already developed lucrative
relations with small retail health stores, alternative medicine clinics, and dispensaries. We will continue to expand and
have both Pure Hemp and CBD patches in stores across the nation. Our initial strategy has been working with smaller
retail outlets but plans are underway to introduce our custom CBD formulations in larger more established chains such
as CVD, Walgreens, Target, etc.
Intellectual Properties & Licenses
Our success and ability to compete are substantially dependent upon our internally developed technology and expertise.
We rely on patent, copyright, trade secret, and trademark law to protect our technology. We currently have several patent
application pending. We also believe that factors such as the technological and creative skills of our personnel, and new
product developments and enhancements are essential to establishing and maintaining a technology leadership position. There
can be no assurance that others will not develop technologies that are similar or superior to our technology.
Our success will depend in part upon our ability to protect our intellectual property rights. We cannot be certain that other
parties will not contest our intellectual property rights