General form for registration of securities under the Securities Act of 1933

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM S-1/A

Amendment # 2

REGISTRATION STATEMENT

UNDER

THE SECURITIES ACT OF 1933

Commission file number: 333-228741

CANNAPOWDER, INC.

(Exact Name Of Registrant As Specified In Its Charter)

Nevada 20-3353835
(State of Incorporation)

(Primary Standard Industrial

Classification Code Number)

(I.R.S. Employer
Identification No.)

Liron Carmel, Chief Executive Officer

20 Raoul Wallenberg Street, Tel Aviv, 6971916 Israel

Tel: +972-3-613-0421

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Corporate Creations Network Inc.

8275 South Eastern Avenue, Suite 200, Las Vegas, NV 89123

Tel: (702) 951-9324

(Name, address, including zip code, and telephone number, including area code, of agent for service)

Copies of communications to:

The Lonergan Law Firm LLC

Lawrence R. Lonergan, Esq.

96 Park Street

Montclair, NJ 07042

(973) 641-4012

Approximate date of commencement of proposed sale to the public: As soon as practicable after the effective date of this registration statement.

If any of the securities being registered on this Form are to be offered on a delayed or continuous basis pursuant to Rule 415 under the Securities Act of 1933 check the following box. [  ]

If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [  ]

If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [  ]

If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. [  ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [  ] Accelerated filer
Non-Accelerated filer [  ] Smaller reporting company [X]
(Do not check if a smaller reporting company) Emerging growth company [X]

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided to Section 7(a)(2)(B) of the Securities Act. [X]

CALCULATION OF REGISTRATION FEE

Title of Each
Class of Securities
to be Registered
Amount to be Registered (1)

Proposed
Maximum
Offering Price
per Share (2)

Estimated
Proposed
Maximum Aggregate
Offering Price

Amount of
Registration Fee

(3)

Common Stock, Par Value $0.0001 2,343,291 Shares $ 1.60 $ 3,749,265.60 $ 454.41

(1) This Registration Statement covers the resale by our Selling Shareholders of up to 2,343.292 shares of Common Stock previously issued to such Selling Shareholders.
(2)

The Offering price has been estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(c) of the Securities Act and is based upon a $1.60 per share the share price on the OTC Market on December 10, 2018, the most recent day that the Registrant’s shares traded on the OTC Markets.

(3) Calculated pursuant to Rule 457(a) based on an estimate of the proposed maximum aggregate offering price.

The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until the Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.

The information in this Prospectus is not complete and may be changed. We may not sell these securities until the Registration Statement filed with the Securities and Exchange Commission becomes effective. This Prospectus is not an offer to sell these securities and we are not soliciting offers to buy these securities in any state where the offer or sale is not permitted.

PRELIMINARY PROSPECTUS

SUBJECT TO COMPLETION ON FEBRUARY __ 2019

CANNAPOWDER, INC.

2,343,291 SHARES OF COMMON STOCK

The selling shareholders (the “Selling Shareholders”) named in this prospectus (the “Prospectus”) are offering shares of common stock, par value $0.00001 per share (the “Common Stock”) of CannaPowder, Inc., a Delaware corporation f/k/a Smart Energy Solutions, Inc., a Nevada corporation, offered through this Prospectus. We are filing this registration statement (the “Registration Statement”), of which this Prospectus forms a part, in order to permit the Selling Shareholders to sell a portion of their restricted shares of Common Stock that they acquired in a series of transactions exempt from registration under the Securities Act of 1933, as amended (the “Act”) pursuant to the provisions of Regulation D and Regulation S promulgated by the United States Securities and Exchange Commission (the “SEC”) under the Act. The shares of Common Stock to be offered and sold by the Selling Shareholders, as disclosed in the section under the caption “Selling Shareholders” of this Prospectus, have already been issued and are currently issued and outstanding Common Stock of the Company. We will not receive any proceeds from the sale of the Common Stock by the Selling Shareholders covered by this Prospectus in connection with the offering (the “Offering”).

Our Common Stock is subject to quotation on OTC Pink Market under the symbol CAPD. On December 10, 2018, the last reported sales price for our Common Stock was $ 1.60 per share. We urge prospective purchasers of our Common Stock to obtain current information about the market prices of our Common Stock. The shares of our Common Stock may be offered and sold by the Selling Shareholders at a fixed price of $1.60 per share until our Common Stock is quoted on the OTCQB tier of the OTC Markets, and thereafter at prevailing market prices or privately negotiated prices or in transactions that are not in the public market. Notwithstanding our belief that upon the effective date of this registration statement our Common Stock will qualify of quotation on the OTCQB and we intend to pursue application for admission to the OTCQB, we cannot assure you that our Common Stock will, in fact, be quoted on the OTCQB tier.

Our independent registered public accounting firm has expressed substantial doubt as to our ability to continue as a going concern.

Investing in our Common Stock involves a high degree of risk. See “Risk Factors” beginning on page 5 to read about factors you should consider before buying shares of our Common Stock.

NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR DETERMINED IF THIS PROSPECTUS IS TRUTHFUL OR COMPLETE. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

The Date of This Prospectus is: February __, 2019

TABLE OF CONTENTS

Page
Special Note Regarding Forward-Looking Statements ii
The Offering 1
Prospectus Summary 2
Risk Factors 5
Use of Proceeds 11
Table of Selling Shareholders 11
Description of Business 17
Financial Information 30
Management’s Discussion and Analysis of Financial Condition and Results of Operations 31
Directors, Executive Officers, Promoters and Control Persons 35
Executive Compensation 37
Securities Ownership of Management and Principal Stockholders 38
Transactions with Related Persons, Promoters and Certain Control Persons 39
Description of our Capital Stock 39
Plan of Distribution 40
Legal Matters 41
Experts 41
Where You Can Find More Information 42
Disclosure of Commission Position on Indemnification for Securities Act Liabilit ies 42

i

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

This prospectus, including the sections entitled “Prospectus Summary,” “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations,” contains forward-looking statements within the meaning of the federal securities laws. These statements relate to anticipated future events, future results of operations or future financial performance. In some cases, you can identify forward-looking statements by terminology such as “may,” “might,” “will,” “should,” “intends,” “expects,” “plans,” “goals,” “projects,” “anticipates,” “believes,” “estimates,” “predicts,” “potential,” or “continue” or the negative of these terms or other comparable terminology. These forward-looking statements include, but are not limited to:

our ability to manage our product development working with our collaboration partners in Israel;
our ability to generate market acceptance for our products in development;
our ability to attract and retain key officers and employees, including key personnel at our wholly-owned Israeli subsidiary, Canna Powder Ltd;
our ability to raise capital and obtain financing on acceptable terms;
our ability to compete with other companies developing products and selling services competitive with ours, and who may have greater resources and name recognition than we have;
our ability to keep pace with a changing industry and its rapidly evolving technology demands and regulatory environment; and
our ability to protect and enforce intellectual property rights.

These forward-looking statements are only predictions, are uncertain and involve substantial known and unknown risks, uncertainties and other factors which may cause our (or our industry’s) actual results, levels of activity or performance to be materially different from any future results, levels of activity or performance expressed or implied by these forward-looking statements. The “Risk Factors” section of this prospectus sets forth detailed risks, uncertainties and cautionary statements regarding our business and these forward-looking statements. Moreover, we operate in a very competitive and rapidly changing regulatory environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all of the risks and uncertainties that could have an impact on the forward-looking statements contained in this prospectus.

We cannot guarantee future results, levels of activity or performance. You should not place undue reliance on these forward-looking statements, which speak only as of the date of this prospectus. These cautionary statements should be considered with any written or oral forward-looking statements that we may issue in the future. Except as required by applicable law, including the securities laws of the U.S., we do not intend to update any of the forward-looking statements to conform these statements to reflect actual results, later events or circumstances or to reflect the occurrence of unanticipated events. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures or other investments or strategic transactions we may engage in.

ii

The Offering

Common Stock offered by Selling Shareholders

2,343,291 shares of Common Stock representing approximately 22.3% of our current 10,518,226 outstanding shares of Common Stock. (1)

Common Stock outstanding before and after the Offering 10,518,226 shares.
Terms of the Offering

The Selling Shareholders will determine when and how they will sell the Common Stock offered in this Prospectus. The shares of our Common Stock may be offered and sold by Selling Shareholders at a fixed price of $1.60 per share until our Common Stock is quoted on the OTCQB tier of the OTC Markets, and thereafter at prevailing market prices or privately negotiated prices or in transactions that are not in the public market. Notwithstanding our belief that upon the effective date of this registration statement our Common Stock will satisfy the admission requirements for the OTCQB and our intention to make application for quotation on the OTCQB Market, we cannot assure you that our Common Stock will be quoted on the OTCQB tier.

Termination of the Offering

The Offering will conclude upon such time as all of the Common Stock has been sold pursuant to the Registration Statement.

Trading Market Our Common Stock is subject to quotation on the OTC Pink Market under the symbol CAPD.
Use of proceeds The Company is not selling any shares of the Common Stock covered by this Prospectus. As such, we will not receive any of the Offering proceeds from the registration of the shares of Common Stock covered by this Prospectus.
Risk Factors The Common Stock offered hereby involves a high degree of risk and should not be purchased by investors who cannot afford the loss of his/her/its entire investment. See “Risk Factors”.

(1) Based on 10,518,226 shares of Common Stock outstanding as of February 4, 2019 .

1

PROSPECTUS SUMMARY

This summary highlights selected information contained elsewhere in this Prospectus. This summary does not contain all the information that you should consider before investing in the Common Stock. You should carefully read the entire Prospectus, including “Risk Factors”, “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the Financial Statements, before making an investment decision. In this Prospectus, the terms “CannaPowder” “Company,” “Registrant,” “we,” “us” and “our” refer to CannaPowder, Inc., a Nevada corporation.

Please read this Prospectus carefully and in its entirety. This Prospectus contains disclosure regarding our business, our financial condition and results of operations and risk factors related to our business and our Common Stock, among other material disclosure items. We have prepared this Prospectus so that you will have the information necessary to make an informed investment decision.

You should rely only on information contained in this Prospectus. We have not authorized any other person to provide you with different information. This Prospectus is not an offer to sell, nor is it seeking an offer to buy, these securities in any state where the offer or sale is not permitted. The information in this Prospectus is complete and accurate as of the date on the front cover, but the information may have changed since that date.

The Registration Statement containing this Prospectus, including the exhibits to the Registration Statement, provides additional information about our Company and the Common Stock offered under this Prospectus. The Registration Statement, including the exhibits and the documents incorporated herein by reference, can be read on the Securities and Exchange Commission website or at the Securities and Exchange Commission offices mentioned under the heading “Where You Can Find More Information.”

Reference is made to the disclosure contained under “Description of Business,” below.

2

Business Plan

CannaPowder, Inc., f/k/a Smart Energy Solutions, Inc. (the “Company” or “Registrant”) was incorporated in 1999 in the State of Utah under the name Datigen.com, Inc. On August 25, 2005, the Registrant was redomiciled from Utah to Nevada pursuant to a merger with and into its wholly-owned subsidiary, Smart Energy Solutions, Inc., a Nevada corporation and, in connection therewith, its name was changed to Smart Energy Solutions, Inc.

Prior to the merger into its wholly-owned subsidiary, the Company was engaged in activities including development and marketing of various internet and internet related products and services, investment in real property related instruments, and providing concrete cutting and finishing services to construction sites seeking to comply with certain provisions of the American Disability Act of 1991. In November 2004, the Company had a change in control as a result of the purchase of a majority of the Company’s outstanding common stock by unaffiliated individuals.

In connection with the change in control, the Company determined to pursue other business opportunities and, as a result, on March 23, 2005, the Company entered into an asset purchase agreement with Purisys, Inc., a New Jersey corporation, and acquired the intellectual property rights and certain other assets relating to a product known as the “Battery Brain,” a device attached to a motor vehicle battery for the purpose of protecting the vehicle from battery failure and theft.

Following the purchase of the Battery Brain assets, the Company devoted its resources and entered into agreements with third parties for the manufacture and distribution of products using the Battery Brain technology. During the period from March 2005, the date of the asset purchase agreement, through the end of 2009, the Company devoted its efforts to marketing activities directed at the automotive industry, including automotive retail, dealers, OEMs, and automotive specialty such as fleets, military, heavy trucks and equipment, motor home/RV and marine.

The Company continued to generate losses from operations and, as of its fiscal year-ended December 31, 2008, the Company had an accumulated deficit of in excess of $22 million. While the Company continued to file reports under the Securities Exchange Act of 1934 (the “Exchange Act”) through its quarterly report on Form 10-Q for the period ended September 30, 2009, the Company lacked sufficient capital resources to continue to fund the expenses including professional fees associated with being a current, reporting company under the Exchange Act.

As a result, from and after the filing of its 10-Q for the period ended September 30, 2009, the Company ceased active business operations and determined to devote its limited and depleting cash resources to seek operations that would generate revenues and positive cash flow compared to its prior operations seeking to exploit its Battery Brain technology. The Company became delinquent in its reporting obligations under the Exchange Act, failing to file its annual report on Form 10-K for the year ended December 31, 2009 and continued to be a delinquent filer until it filed a Form 15, terminating its registration under Section 12(g) of the Exchange Act on July 24, 2013.

Prior to filing the Form 15, the Company’s assets became subject to a proceeding before the Superior Court of the State of New Jersey, which resulted in the appointment of a receiver in early 2013. The principal creditor in that proceeding was Aharon Levinas, who had sold the Battery Brain assets formerly owned by Purysis in March 2005. On June 7, 2013, in connection with the order of the Superior Court of the State of New Jersey, the Court authorized and approved the sale, transfer and assignment of all of the Company’s assets to Aharon Levinas, free and clear of any liens, claims or encumbrances and granting Mr. Levinas effective control of the Company.

During November 2014 and March 2015, third-party investors acquired control of the Company by purchasing a control block of shares each holding 137,500 shares representing 88% of the Company’s issued and outstanding shares of common stock. Reference is made to the disclosure under “Security Ownership of Certain Beneficial Owners and Management,” below.

3

Recent Corporate Developments

On August 30, 2017, a new wholly-owned subsidiary was registered in Israel under the name of Canna Powder Ltd. (“CannaPowder Israel” or the “Subsidiary”), with 100 common shares outstanding (the “Subsidiary Shares”), all of which were held in escrow on behalf of the Company by Israel attorney, Alon Nave. On September 27, 2017, pursuant to board resolution, the 100 Subsidiary Shares held in escrow were transferred to the Company.

The Subsidiary’s management includes Lavi Krasney, its CEO, and Rafi Ezra, its CTO. Reference is made to the disclosure under the subcaption “Key Employees” included in “Item 5. Directors and Executive Officers” below.

Development is being conducted at the Hebrew University under the supervision of the inventor of the technology, Professor Shlomo Magdassi, pursuant to the term of the Feasibility Study and Option Agreement dated September 14, 2017 (the “Feasibility Study”), a fully-executed copy of which is attached as Exhibit 10.1.2 to this Form 10 amendment, as more fully discussed below.

On December 27, 2017, a board resolution was adopted to issue an additional: (i) 800 Subsidiary Shares to the Company; and an additional 100 Subsidiary Shares to Rafi Ezra and, as a result, effective December 27, 2017, Canna Powder Ltd became a 90% owned subsidiary of the Company and a minority interest of 10% owned by Rafi Ezra.

Our Filing Status as a “Smaller Reporting Company

We are a “smaller reporting company,” meaning that we are not an investment company, an asset-backed issuer, or a majority-owned subsidiary of a parent company that is not a smaller reporting company and have a public float of less than $75 million and annual revenues of less than $50 million during the most recently completed fiscal year. As a “smaller reporting company,” the disclosure we will be required to provide in our SEC filings are less than it would be if we were not considered a “smaller reporting company.” Specifically, “smaller reporting companies” are able to provide simplified executive compensation disclosures in their filings; are exempt from the provisions of Section 404(b) of the Sarbanes-Oxley Act of 2002 requiring that independent registered public accounting firms provide an attestation report on the effectiveness of internal control over financial reporting; are not required to conduct say-on-pay and frequency votes until annual meetings occurring on or after January 21, 2013; and have certain other decreased disclosure obligations in their SEC filings, including, among other things, being permitted to provide two years of audited financial statements in annual reports rather than three years. Decreased disclosures in our SEC filings due to our status as a “smaller reporting company” may make it harder for investors to analyze the Company’s results of operations and financial prospects.

Before you invest in our Common Stock, you should carefully consider all the information in this prospectus, including matters set forth under the heading “Risk Factors.”

Where You Can Find Us

We presently maintain our principal offices at 20 Raoul Wallenberg Street, Tel Aviv, 6971916 Israel, Phone: +(972) 54-222-9702

4

RISK FACTORS

Risks Relating to Our Business

Risks Relating to Our Lack of Operating History and Industry.

Any investment in our shares of common stock involves a high degree of risk. You should carefully consider the following information about these risks, together with the other information contained in this annual report before you decide to invest in our common stock. Each of the following risks may materially and adversely affect our business objective, plan of operation and financial condition. These risks may cause the market price of our common stock to decline, which may cause you to lose all or a part of the money you invested in our common stock. We provide the following cautionary discussion of risks, uncertainties and possible inaccurate assumptions relevant to our business plan. In addition to other information included in this annual report, the following factors should be considered in evaluating the Company’s business and future prospects.

The Company has a limited operating history and very limited resources.

The Company’s recent operations have been limited and has had no revenues from operations. Investors will have no basis upon which to evaluate the Company’s ability to achieve the Company’s plan of operation.

The Company’s officers and sole director may allocate their time to other businesses thereby causing conflicts of interest in his determination as to how much time to devote to the Company’s affairs. This could have a negative impact on the Company’s ability to implement its plan of operation.

The Company’s two executive officers, Oded Gilboa, our CFO, and Liron Carmel, our CEO and sole director, are not required nor are they expected to commit their full time to the Company’s affairs, which may result in a conflict in allocating their time between the Company’s business and other businesses. Management of the Company is engaged in several other business endeavors and while none of which are involved in the medical cannabis business, they are not precluded by employment or non-competition agreements or otherwise from becoming involved in cannabis related businesses that may compete with the Company, either directly or indirectly. Members of our Management are not obligated to contribute any specific number of hours per week to the Company’s affairs. If Management’s other business affairs require them to devote a substantial amount of time to such other business affairs, it could limit their ability to devote time to the Company’s affairs and could have a negative impact on the Company’s ability to implement its plan of operation.

Mr. Gilboa’s other business endeavors include providing financial statement preparation, book and record keeping and financial consulting for a number of small to medium sized businesses in addition to Canna Powder Inc. During the past five years, Mr. Gilboa has provided services to private Israeli companies including: (i) Bootnest Ltd, an Internet service provider with headquarters located in Ra’anana, Israel that identifies, develops and utilizes business opportunities in various fields of interest, with emphasis on business initiatives in the field of sports, among other fields, and provides business consulting and relates services in raising capital; and (ii) Professional Patent Solutions Ltd, engaged in developing technology based and industry-based IP strategies for leading start-ups and established companies in the fields of communication, semiconductors and computing principally in Israel. Mr. Carmel’s other business endeavors include providing management and strategic consulting services to a number of small to medium sized businesses and organization including: (i) Board member and consultant to Virtual Crypto Technologies Ltd. a company engaged in technology development to allow fast and accurate cryptocurrencies trade executions (ii) Active chairman of the Israeli Table Tennis Association. (iii) From 2013 – 2017 vice president of the Givatayim city Economic Company.

5

The Company may be unable to obtain additional financing, if required, to complete its plan of operation or to fund the operations and growth of it business, which could compel the Company to abandon its business.

If we require funds, we will be required to seek additional financing. We cannot assure you that such financing would be available on acceptable terms, if at all. To the extent that additional financing proves to be unavailable when needed, we would be compelled to abandon our business plan. In addition, we may require additional financing to fund the operations or growth of our business. The failure to secure additional financing could have a material adverse effect on the continued development or growth of our business. The Company’s officers, director or stockholders are not required to provide any financing to us.

Broad discretion of Management

Any person who invests in the Company’s common stock will do so without an opportunity to evaluate the specific merits or risks our business. As a result, investors will be entirely dependent on the broad discretion and judgment of Management. There can be no assurance that determinations made by the Company’s Management will permit us to achieve the Company’s business plan.

General Economic Risks.

The Company’s current and future business objectives and plan of operation are likely dependent, in large part, on the state of the general economy. Adverse changes in economic conditions may adversely affect the Company’s business objective and plan of operation. These conditions and other factors beyond the Company’s control include also but are not limited to regulatory changes.

Our control shareholders have significant voting power and may take actions that may be different than actions sought by our other stockholders.

Our control shareholders own approximately 40.2% of the outstanding shares of our Common Stock. These stockholders will be able to exercise significant influence over all matters requiring stockholder approval. This influence over our affairs might be adverse to the interest of our other stockholders. In addition, this concentration of ownership could delay or prevent a change in control and might have an adverse effect on the market price of our common stock.

Our officers and sole director are located in Israel and our assets may also be held from time to time outside of the United States.

Since all of our officers and sole director are currently located in and/or are residents of Israel, any attempt to enforce liabilities upon such individuals under the U.S. federal securities and bankruptcy laws may be difficult. In accordance with the Israeli Law on Enforcement of Foreign Judgments, 5718-1958, and subject to certain time limitations (the application to enforce the judgment must be made within five years of the date of judgment or such other period as might be agreed between Israel and the United States), an Israeli court may declare a foreign civil judgment enforceable if it finds that:

- the judgment was rendered by a court which was, according to the laws of the State in which the court is located, competent to render the judgment;

- the judgment may no longer be appealed;

- the obligation imposed by the judgment is enforceable according to the rules relating to the enforceability of judgments in Israel and the substance of the judgment is not contrary to public policy; and

- the judgment is executory in the State in which it was given.

An Israeli court will not declare a foreign judgment enforceable if:

- the judgment was obtained by fraud;

- there is a finding of lack of due process;

- the judgment was rendered by a court not competent to render it according to the laws of private international law in Israel;

- the judgment is in conflict with another judgment that was given in the same matter between the same parties and that is still valid; or

- the time the action was instituted in the foreign court, a suit in the same matter and between the same parties was pending before a court or tribunal in Israel.

6

Furthermore, Israeli courts may not adjudicate a claim based on a violation of U.S. securities laws if the court determines that Israel is not the most appropriate forum in which to bring such a claim. Even if an Israeli court agrees to hear such a claim, it may determine that Israeli law, not U.S. law, is applicable to the claim. If U.S. law is found to be applicable, the content of applicable U.S. law must be proven as a fact, which can be a time-consuming and costly process.

Our assets may also be held from time to time outside of the United States. Since our director and executive officers are foreign citizens and do not reside in the United States, it may be difficult for courts in the United States to obtain jurisdiction over our foreign assets or persons, and as a result, it may be difficult or impossible for you to enforce judgments rendered against us or our sole director or executive officers in United States courts. Thus, investing in us may pose a greater risk because should any situation arise in the future in which you would have a cause of action against these persons or against us, you may face potential difficulties in bringing lawsuits or, if successful, in collecting judgments against these persons or against the Company.

Regulatory Risks

We face risks related to compliance with corporate governance laws and financial reporting standards.

The Sarbanes-Oxley Act of 2002, as well as related new rules and regulations implemented by the Securities and Exchange Commission and the Public Company Accounting Oversight Board, require changes in the corporate governance practices and financial reporting standards for public companies. These new laws, rules and regulations, including compliance with Section 404 of the Sarbanes-Oxley Act of 2002 relating to internal control over financial reporting, have materially increased the legal and financial compliance costs of small companies and have made some activities more time-consuming and more burdensome.

We face risks associated with laws and regulations applicable to controlled substances; difficulties of complying with laws that differ from jurisdiction to jurisdiction.

Our planned cannabis powder-based products will contain controlled substances and are subject laws of the U.S. and many foreign countries as well as a myriad of rules and regulations. Controlled substance laws differ, often radically, between countries and from state to state in the United States and legislation in certain countries and states are subject to change, perhaps to our detriment, and, as a result, may restrict or even severely limit our ability to distribute cannabis-based powders, if and when we complete development, of which there can be no assurance. Furthermore, there can be no assurance that we will be able to successfully address the difficulties we expect to confront in efforts to comply with the laws and regulations applicable to cannabis-related medical products in different jurisdictions in which we will seek to operate. These differences, from jurisdiction to jurisdiction and from state to state may be expected to restrict or limit in a material manner our ability to commercially exploit and distribute our products in one or more jurisdictions/states where the regulations or laws are in conflict or are mutually exclusive.

We may not have effective internal controls.

The rules and regulations of the SEC require a public company to prepare and file periodic reports under the Exchange Act, which will require that the Company engage legal, accounting, auditing and other professional service providers. The engagement of such services is costly and continuing. Additionally, the Sarbanes-Oxley Act of 2002 (the “Sarbanes-Oxley Act”) requires, among other things, that we design, implement and maintain adequate internal controls and procedures over financial reporting. The costs of complying with the Sarbanes-Oxley Act and the limited technically qualified personnel we have may make it difficult for us to design, implement and maintain adequate internal controls over financial reporting. We expect these costs to be increased as our operations increase in scope and magnitude. In the event that we fail to maintain an effective system of internal controls or discover material weaknesses in our internal controls, we may not be able to produce reliable financial reports and/or discover and report fraud, which may harm our overall financial condition and result in loss of investor confidence and a decline in our share price.

7

As a public company and the effective date of the Company’s registration statement on Form 10 on June 29, 2018, we became subject to the reporting requirements of the Exchange Act, the Sarbanes-Oxley Act, the Dodd-Frank Act of 2010 and other applicable securities rules and regulations. Our legal and financial compliance costs related to these rules and regulations may increase, make some activities more difficult, time-consuming or costly and increase demand on our systems and resources. The Exchange Act requires, among other things, that we file annual and quarterly, and, from time-to-time, current reports with respect to our business and operating results.

We are working with our legal, independent accounting and financial advisors to identify those areas in which changes should or could be made to improve our financial and management control systems in order to manage our growth and our legal obligations as a public company. These areas include corporate governance, corporate control, disclosure controls and procedures and financial reporting and accounting systems. We have made, and will continue to make, changes in these and other areas, if and when any perceived deficiencies are discovered. However, we anticipate that the expenses associated with being a reporting public company are expected to be both material and continuing. We estimate that the aggregate cost of legal services; accounting and audit functions; personnel, such as a chief financial officer familiar with the obligations of public company reporting; and consultants to design and implement internal controls could be material. In addition, if and when we retain independent directors and/or additional members of senior management, we may incur additional expenses related to director compensation and/or premiums for directors’ and officers’ liability insurance (“D&O Insurance”), the costs of which we cannot estimate at this time. We may also incur additional expenses associated with investor relations and similar functions, the cost of which we also cannot estimate at this time. However, these additional expenses individually, or in the aggregate, may also be expected to be material. In addition, being a public company could make it more difficult or more-costly for us to obtain certain types of insurance, including D&O Insurance, and we may be forced to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. The impact of these events could also make it more difficult for us to attract and retain qualified persons to serve on our board of directors, our board committees or as executive officers.

Risks Relating to Operating in Israel.

We conduct our operations in Israel and therefore our results may be adversely affected by political, economic and military instability in Israel or the Middle East.

Our subsidiary offices and our officers and sole director are located in Israel. Accordingly, political, economic and military conditions in Israel and the Middle East may directly affect our business. Since the establishment of the State of Israel in 1948, a number of armed conflicts have taken place between Israel and its Arab neighbors. Any hostilities involving Israel or the interruption or curtailment of trade within Israel or between Israel and its trading partners could adversely affect our operations and could make it more difficult for us to raise capital. Since September 2000, terrorist violence in Israel has increased significantly and negotiations between Israel and Palestinian representatives have not achieved a peaceful resolution of the conflict. The establishment in 2006 of a government in Gaza by representatives of the Hamas militant group has created additional unrest and uncertainty in the region.

Further, Israel is currently engaged in an armed conflict with Hamas, which until Operation Cast Lead in January 2009 had involved thousands of missile-strikes and had disrupted most day-to-day civilian activity in southern Israel. The missile attacks by Hamas did not target Tel Aviv, the location of our principal executive offices; however, any armed conflict, terrorist activity or political instability in the region may negatively affect business conditions and could significantly harm our results of operations.

8

Risks Related to Our Common Stock

Our historic stock price has been volatile and the future market price for our common stock is likely to continue to be volatile. Further, the limited market for our shares will make our price more volatile. This may make it difficult for you to sell our common stock.

The public market for our Common Stock has been very volatile. Over the past three fiscal years and subsequent quarterly periods, the market price for our Common Stock has ranged from $0.35 to $2.70 (See “Market for Common Equity and Related Stockholder Matters” in this annual report). Any future market price for our shares is likely to continue to be very volatile. This price volatility may make it more difficult for you to sell shares when you want at a price you find attractive. Further, the market for our Common Stock is limited and we cannot assure you that a larger market will ever be developed or maintained. Market fluctuations and volatility, as well as general economic, market and political conditions, could reduce our market price. As a result, this may make it difficult or impossible for you to sell our Common Stock.

The Company’s shares of common stock are quoted on the OTC Pink Sheet market, which limits the liquidity and price of the Company’s common stock.

The Company’s shares of Common Stock are traded on the OTC Pink Sheet market under the symbol CAPD. Quotation of the Company’s securities on the OTC Pink Sheet market limits the liquidity and price of the Company’s Common Stock more than if the Company’s shares of Common Stock were listed on The Nasdaq Stock Market or a national exchange. There is currently no active trading market in the Company’s Common Stock. There can be no assurance that there will be an active trading market for the Company’s Common Stock following a business combination. In the event that an active trading market commences, there can be no assurance as to the market price of the Company’s shares of Common Stock, whether any trading market will provide liquidity to investors, or whether any trading market will be sustained. Furthermore, because our shares of Common Stock are traded on the OTC Pink Sheet market, the shares of our Common Stock may only be offered and sold by Selling Shareholders at a fixed price of $1.60 per share until our Common Stock is quoted on the OTCQB tier of the OTC Markets, and thereafter at prevailing market prices or privately negotiated prices or in transactions that are not in the public market. We cannot assure you that our Common Stock will be quoted on the OTCQB tier notwithstanding our belief that we will satisfy the eligibility standards for admission to, and our intention to make application for quotation on the OTCQB.

Our common stock is subject to the Penny Stock Rules of the SEC and the trading market in our common stock is limited, which makes transactions in our stock cumbersome and may reduce the value of an investment in our common stock.

The Securities and Exchange Commission has adopted Rule 3a51-1 which establishes the definition of a “penny stock,” for the purposes relevant to us, as any equity security that has a market price of less than $5.00 per share or with an exercise price of less than $5.00 per share, subject to certain exceptions. For any transaction involving a penny stock, unless exempt, Rule 15g-9 require:

- that a broker or dealer approve a person’s account for transactions in penny stocks; and

- the broker or dealer receive from the investor a written agreement to the transaction, setting forth the identity and quantity of the penny stock to be purchased.

In order to approve a person’s account for transactions in penny stocks, the broker or dealer must:

- obtain financial information and investment experience objectives of the person; and

- make a reasonable determination that the transactions in penny stocks are suitable for that person and the person has sufficient knowledge and experience in financial matters to be capable of evaluating the risks of transactions in penny stocks.

The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prescribed by the SEC relating to the penny stock market, which, in highlight form:

- sets forth the basis on which the broker or dealer made the suitability determination; and

- that the broker or dealer received a signed, written agreement from the investor prior to the transaction.

Generally, brokers may be less willing to execute transactions in securities subject to the “penny stock” rules. This may make it more difficult for investors to dispose of our Common Stock and cause a decline in the market value of our stock.

Disclosure also has to be made about the risks of investing in penny stocks in both public offerings and in secondary trading and about the commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions. Finally, monthly statements have to be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.

9

State blue sky registration; potential limitations on resale of the Company’s common stock

The holders of the Company’s shares of Common Stock registered under the Exchange Act and those persons who desire to purchase them in any trading market that may develop in the future, should be aware that there may be state blue-sky law restrictions upon the ability of investors to resell the Company’s securities. Accordingly, investors should consider the secondary market for the Registrant’s securities to be a limited one.

It is the intention of our Management to seek coverage and publication of information regarding the Registrant in an accepted publication manual which permits a manual exemption. The manual exemption permits a security to be distributed in a particular state without being registered if the Registrant issuing the security has a listing for that security in a securities manual recognized by the state. However, it is not enough for the security to be listed in a recognized manual. The listing entry must contain (1) the names of issuers, officers, and directors, (2) an issuer’s balance sheet, and (3) a profit and loss statement for either the fiscal year preceding the balance sheet or for the most recent fiscal year of operations. Furthermore, the manual exemption is a non-issuer exemption restricted to secondary trading transactions, making it unavailable for issuers selling newly issued securities.

Most of the accepted manuals are those published by Standard and Poor’s, Moody’s Investor Service, Fitch’s Investment Service, and Best’s Insurance Reports, and many states expressly recognize these manuals. A smaller number of states declare that they “recognize securities manuals” but do not specify the recognized manuals. The following states do not have any provisions and therefore do not expressly recognize the manual exemption: Alabama, Georgia, Illinois, Kentucky, Louisiana, Montana, South Dakota, Tennessee, Vermont and Wisconsin.

Dividends unlikely

The Company does not expect to pay dividends for the foreseeable future because it has no revenues or cash resources. The payment of dividends will be contingent upon the Company’s future revenues and earnings, if any, capital requirements and overall financial conditions. The payment of any future dividends will be within the discretion of the Company’s board of directors as then constituted. It is the Company’s expectation that future management, following a business combination, will determine to retain any earnings for use in its business operations and accordingly, the Company does not anticipate declaring any dividends in the foreseeable future.

In anticipation of the formation of Canna Powder Ltd, the Company’s Israeli subsidiary organized on August 30, 2017, the Company began to raise capital through the private sale of its equity securities primarily pursuant to the exemptions provided under Regulation S promulgated by the Securities and Exchange Commission (the “SEC”) under the Securities Act of 1933, as amended (the “Act”) and, to a lesser extent, pursuant to Regulation D promulgated by the SEC under the Act (collectively, the “Equity Raise”). To date, the Company has raised approximately $1,643,979 in the Equity Raise. Reference is made to the disclosure “Note 8 Subsequent Events” in the Notes to Consolidated Financial Statements for the nine-month period ended September 30, 2018, below.

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USE OF PROCEEDS

We will not receive any proceeds from the sale of Common Stock by the Selling Shareholders. All proceeds from the sale of our Common Stock by Selling Shareholders will go to the Selling Shareholders as described more fully below in the sections entitled “Selling Shareholders” and “Plan of Distribution.” We have agreed to bear the expenses relating to the registration of the Common Stock for the Selling Shareholders.

TABLE OF SELLING SHAREHOLDERS

The shares of Common Stock being offered for resale by the Selling Shareholders consist of 2,343,291 shares of our Common Stock held by 48 shareholders. Such Selling Shareholders include the holders of shares that we sold at offering prices ranging from $0.01 to $1.20 per share or per unit, as the case may be, from October 17, 2017 through November 20, 2018. These private offerings were made in reliance on and pursuant to the provisions Regulation S and, to a lesser extent, Regulation D, both promulgated by the SEC under the Act. The following table sets forth the names of the Selling Shareholders and the number of shares of Common Stock beneficially owned by them as of the date of our Registration Statement, of which this Prospectus is a part, and the number of shares of Common Stock being offered by the Selling Shareholders. The shares being offered hereby are being registered to permit public secondary trading. The Selling Shareholders may offer all or part of the shares for resale from time to time. However, the Selling Shareholders are under no obligation to sell all or any portion of their shares subject to this Registration Statement, nor are the Selling Shareholders obligated to sell any shares immediately upon effectiveness of this Registration Statement.

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Last Name First Name

Shares Beneficially

Owned Prior to
Offering

Shares to Be Offered Shares Beneficially Owned After Offering Percentage Beneficially Owned after Offering
Uziel Amir 650,000 162,500 487,500 6.0 %
Atribute Ltd (1) 650,000 162,500 487,500 6.0 %
Krasney Lavi 650,000 162,500 487,500 6.0 %
Silberman Kfir 650,000 162,500 487,500 6.0 %
Uziel Doron 425,000 106,250 318,750 3.9 %
Mediouni Asher Gil 425,000 106,250 318,750 3.9 %
Aharonson Orly 425,000 106,250 318,750 3.9 %
Shrem David 425,000 106,250 318,750 3.9 %
Garbi Rafael 425,000 106,250 318,750 3.9 %
Fatal Ronen 425,000 106,250 318,750 3.9 %
Liberman Frida 450,000 112,500 337,500 4.1 %
Liberman Eliezer 400,000 100,000 300,000 3.7 %
Carmel Liron 300,000 75,000 225,000 2.8 %
Gilboa Oded 50,000 12,500 37,500 0.5 %
Reinhold Nir 666,667 166,667 500,000 6.1 %
F1 One of a kind Investment, LLC (2) 250,000 62,500 187,500 2.3 %
Heller Uri 83,333 20,833 62,500 0.8 %
Aharonson Tzvi 83,333 20,833 62,500 0.8 %
Avdinco Ltd. (3) 250,000 62,500 187,500 2.3 %
Tamarid Ltd (4) 250,000 62,500 187,500 2.3 %
Sasson Moshe 83,333 20,833 62,500 0.8 %
Cohen Cohen 50,000 12,500 37,500 0.5 %
Manoah Ron 35,000 8,750 26,250 0.3 %
Barzilai Guy 47,000 11,750 35,250 0.4 %
Maor Maor 41,000 10,250 30,750 0.4 %
Cafri Cafri 33,000 8,250 24,750 0.3 %
Eliezer Keren 28,000 7,000 21,000 0.3 %
Naki Tamar 28,000 7,000 21,000 0.3 %
Fayer Dror 47,000 11,750 35,250 0.4 %
Zehavi Michal Rivka 28,000 7,000 21,000 0.3 %
Shimon Gilad 28,000 7,000 21,000 0.3 %
David Netanel 30,000 7,500 22,500 0.3 %
Mahlav Amos 28,000 7,000 21,000 0.3 %
Levy Arie Mordehay 28,000 7,000 21,000 0.3 %
Ravia Avi 33,000 8,250 24,750 0.3 %
Eliav Eliyahu 28,000 7,000 21,000 0.3 %
Lantz Teddy 110,000 27,500 82,500 1.0 %
Hoyda Kobi 28,000 7,000 21,000 0.3 %
Tentzer Inbar Avraham 28,000 7,000 21,000 0.3 %
Pasternak Eyal 28,000 7,000 21,000 0.3 %
Navon Hovav Naon 52,000 13,000 39,000 0.5 %
Meshek Zon Banegev 35,000 8,750 26,250 0.3 %
Or Yinon Shimon 28,000 7,000 21,000 0.3 %
Goldberg Shafrir 28,000 7,000 21,000 0.3 %
David Hagai 28,000 7,000 21,000 0.3 %
Frenkel Lior 28,000 7,000 21,000 0.3 %
Goldberg Michael 410,000 102,500 307,500 3.8 %
Ben Shachar Amnon 41,500 10,375 31,125 0.4 %
Total 9,373,166 2,343,291 7,029,875 86 %

(1) Attribute Ltd is organized under the laws of Israel with offices in Tel Aviv, Israel. The control person is Mr. Itschak Shrem, a resident of Israel.

(2) F1 One of a Kind Investment, LLC is organized under the laws of the State of Texas with offices in Texas. Its control person is Mr. Shai Cohen, a resident of Texas.

(3) Avdinco Ltd is organized under the laws of Israel with offices in Tel Aviv, Israel. The control person of Avdinco Ltd is Mr. Avner Cohen, a resident of Israel.

(4) Tamarid Ltd is organized under the laws of Israel with offices in Tel Aviv, Israel. The control person of Tamarid Ltd is Mr. Haim Cohen, a resident of Israel.

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PLAN OF DISTRIBUTION

This Prospectus relates to the resale of up to 2,343,291 shares of our Common Stock by the Selling Shareholders.

The Selling Shareholders and any of its pledgees, donees, assignees and other successors-in-interest may, from time to time sell any or all of their shares of Common Stock on any market or trading facility on which the shares are traded or in private transactions. On December 10, 2018, the last reported sales price for our Common Stock was $ 1.60 per share. Because our Common Stock is subject to quotation on OTC Pink Market, our Common Stock may only be offered and sold by the Selling Shareholders at a fixed price of $1.60 per share until our Common Stock is quoted on the OTCQB tier of the OTC Markets, and thereafter at prevailing market prices or privately negotiated prices or in transactions that are not in the public market. Notwithstanding our belief that upon the effective date of this registration statement our Common Stock will satisfy the eligibility standards and requirements for quotation on the OTCQB and our express intention to pursue our application for quotation of our Common Stock on the OTCQB, we cannot assure you that our Common Stock will, in fact, be quoted on the OTCQB tier. We urge prospective purchasers of our Common Stock to obtain current information about the market prices of our Common Stock.

If and when our Common Stock becomes subject to quotation on the OTCQB, of which there can be no assurance, sales of Common Stock by the Selling Shareholders may be at fixed or negotiated prices. The Selling Shareholders may use any one or more of the following methods when selling shares:

Ÿ ordinary brokerage transactions and transactions in which the broker-dealer solicits the purchaser;
Ÿ block trades in which the broker-dealer will attempt to sell the shares as agent but may position and resell a portion of the block as principal;
Ÿ facilitate the transaction;
Ÿ purchases by a broker-dealer as principal and resale by the broker-dealer for its account;
Ÿ an exchange distribution in accordance with the rules of the applicable exchange;
Ÿ privately negotiated transactions;
Ÿ broker-dealers may agree with the Selling Shareholders to sell a specified number of such shares at a stipulated price per share;
Ÿ through the writing of options on the shares
Ÿ a combination of any such methods of sale; and
Ÿ any other method permitted pursuant to applicable law.

The Selling Shareholders shall have the sole and absolute discretion not to accept any purchase offer or make any sale of shares if it deems the purchase price to be unsatisfactory at any particular time.

Assuming that our Common Stock becomes subject to quotation on the OTCQB, of which there can be no assurance, t he Selling Shareholders may also sell the shares at prevailing market prices or privately negotiated prices or in transactions that are not in the public market, directly to market makers acting as principals and/or broker-dealers acting as agents for themselves or their customers. Such broker-dealers may receive compensation in the form of discounts, concessions or commissions from the Selling Shareholders and/or the purchasers of shares for whom such broker-dealers may act as agents or to whom they sell as principal or both, which compensation as to a particular broker-dealer might be in excess of customary commissions. Market makers and block purchasers purchasing the shares will do so for their own account and at their own risk. It is possible that the Selling Shareholders will attempt to sell shares of Common Stock in block transactions to market makers or other purchasers at a price per share which may be below the then existing market price. We cannot assure that all or any of the shares offered in this Prospectus will be issued to, or sold by, the Selling Shareholders. The Selling Shareholders and any broker-dealers or agents, upon completing the sale of any of the shares offered in this Prospectus, may be deemed to be “underwriters” as that term is defined under the Act, the Exchange Act and the rules and regulations of such acts. In such event, any commissions received by such broker-dealers or agents and any profit on the resale of the shares purchased by them may be deemed to be underwriting commissions or discounts under the Act.

The Selling Shareholders, alternatively, may sell all or any part of the shares offered in this Prospectus through an underwriter. The Selling Shareholders have not entered into any agreement with a prospective underwriter and there is no assurance that any such agreement will be entered into.

13

We know of no existing arrangements between the Selling Shareholders and any other shareholder, broker, dealer or agent relating to the sale or distribution of the shares. We will not receive any proceeds from the sale of the shares of the Selling Shareholders pursuant to this Prospectus. We have agreed to bear the expenses of the registration of the shares, including legal and accounting fees, and such expenses are estimated to be approximately $49,500.

A Selling Shareholder may pledge his/her/its shares to their respective brokers under the margin provisions of customer agreements. If a Selling Shareholder defaults on a margin loan, the broker may, from time to time, offer and sell the pledged shares of Common Stock. The Selling Shareholders and any other persons participating in the sale or distribution of the shares will be subject to applicable provisions of the Exchange Act, and the rules and regulations under such act, including, without limitation, Regulation M. These provisions may restrict certain activities of and limit the timing of purchases and sales of any of the shares by, the Selling Shareholders or any other such person. The Selling Shareholders is not permitted to engage in short sales of Common Stock. Furthermore, under Regulation M, persons engaged in a distribution of securities are prohibited from simultaneously engaging in market making and certain other activities with respect to such securities for a specified period of time prior to the commencement of such distributions, subject to specified exceptions or exemptions. All of these limitations may affect the marketability of the shares.

DESCRIPTION OF SECURITIES TO BE REGISTERED

General

We are authorized to issue an aggregate number of 520,000,000 shares of capital stock, $0.00001 par value per share, consisting of 20,000,000 shares of Preferred Stock and 500,000,000 shares of Common Stock.

Preferred Stock

We are authorized to issue 20,000,000 shares of Preferred Stock, $0.00001 par value per share. As of December 10, 2018, no preferred shares were issued and outstanding. The Board of Directors has the authority to establish one or more series of Preferred Stock and fix relative rights and preferences of any series of Preferred Stock, without any further action or approval of our shareholders.

Common Stock

We are authorized to issue 500,000,000 shares of Common Stock, $0.00001 par value per share. As of December 10, 2018, we had 10,518,226 shares of Common Stock issued and outstanding, owned by 227 shareholders of record.

Each share of Common Stock shall have one (1) vote per share for all purpose. Our Common Stock does not provide a preemptive, subscription or conversion rights and there are no redemption or sinking fund provisions or rights. Our Common Stock holders are not entitled to cumulative voting for election of Board of Directors.

Dividends

We have not paid any cash dividends to our shareholders. The declaration of any future cash dividends is at the discretion of our board of directors and depends upon our earnings, if any, our capital requirements and financial position, our general economic conditions, and other pertinent conditions. It is our present intention not to pay any cash dividends in the foreseeable future, but rather to reinvest earnings, if any, in our business operations.

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Warrants

Between November 15, 2017 and December 7, 2017, the Company sold a total of 1,000,000 units for cash consideration of $300,000 at price of $.30 (the “Units”), each unit comprised of one share of Common Stock and one class A warrant exercisable at $0.50 per share with a term of 24 months. The relative fair value of the stock with embedded warrants was $132,458 for the Common Stock and $167,542 for the class A warrants. The warrants were valued using the Black-Scholes model with volatility of approximately 163% and discount rates ranging from 1.68% to 1.8%.

Between March 20, 2018 and March 29, 2018, the Company sold a total of 206,000 units for cash consideration of $123,600 at price of $.60 (the “Units”), each unit comprised of one share of Common Stock and one class B warrant exercisable at $1.20 per share with a term of 24 months. The relative fair value of the stock with embedded warrants was $44,454 for the Common Stock and $ 79,146 for the class B Warrants.

Between April 3, 2018 and May 14, 2018, the Company sold a total of 1,150,500 units for cash consideration of $690,300 at price of $.60 (the “Units”), each unit comprised of one share of Common Stock and one class B warrant exercisable at $1.20 per share with a term of 24 months. The relative fair value of the stock with embedded warrants was $290,996 for the Common Stock and $399,304 for the class B Warrants.

The above-referenced issuances and sales of the Company’s securities was made in reliance upon the exemption provided by Regulation S and, to a lesser extent, Regulation D, promulgated by the United States Securities and Exchange Commission (the “SEC “) under the Act.

Options

The Company has no options issued and outstanding.

Transfer Agent and Registrar

The transfer agent of our Common Stock is Transfer Online, Inc., 512 SE Salmon Street, Portland, OR 97214, Phone: (503) 227-2950

INTEREST OF NAMED EXPERTS AND COUNSEL

No expert or counsel named in this Prospectus as having prepared or certified any part of this Prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or Offering of the Common Stock was employed on a contingency basis, or had, or is to receive, in connection with the Offering, a substantial interest, direct or indirect, in the registrant. Nor was any such person connected with the registrant as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.

The Lonergan Law Firm, Lawrence R. Lonergan, Esq., 96 Park Street, Montclair, NJ 07042, will pass on the validity of the Common Stock being offered pursuant to this Registration Statement.

The audited financial statements for the years ended December 31, 2017 and 2016 included in this Prospectus and the Registration Statement have been audited by M&K CPAS, PLLC, an independent registered public accounting firm, to the extent and for the periods set forth in their report appearing elsewhere herein and in the Registration Statement, and are included in reliance upon such report given upon the authority of said firm as experts in auditing and accounting.

15

WHERE YOU CAN FIND MORE INFORMATION

We filed this Registration Statement on Form S-1 with the SEC under the Act with respect to the Common Stock offered by Selling Shareholders in this Prospectus. This Prospectus, which constitutes a part of the Registration Statement, does not contain all of the information set forth in the Registration Statement or the exhibits and schedules filed therewith. For further information with respect to us and our Common Stock, please see the Registration Statement and the exhibits and schedules filed with the Registration Statement. Statements contained in this Prospectus regarding the contents of any contract or any other document that is filed as an exhibit to the Registration Statement are not necessarily complete, and each such statement is qualified in all respects by reference to the full text of such contract or other document filed as an exhibit to the Registration Statement. The Registration Statement, including its exhibits and schedules, may be inspected without charge at the public reference room maintained by the SEC, located at 100 F Street, N.E., Room 1580, Washington, D.C. 20549, and copies of all or any part of the Registration Statement may be obtained from such offices upon the payment of the fees prescribed by the SEC. Please call the SEC at 1-800-SEC-0330 for further information about the public reference room. The SEC also maintains an Internet website that contains reports, proxy and information statements and other information regarding registrants that file electronically with the SEC. The address of the site is www.sec.gov .

We also maintain a website at http://www.http://canna-powder.com. Upon completion of this Offering, you may access these materials on our website free of charge as soon as reasonably practicable after they are electronically filed with, or furnished to, the SEC. Information contained on our website is not a part of this Prospectus and the inclusion of our website address in this Prospectus is an inactive textual reference only.

16

DESCRIPTION OF BUSINESS

Business Plan

CannaPowder, Inc., f/k/a Smart Energy Solutions, Inc. (the “Company” or “Registrant”) was incorporated in 1999 in the State of Utah under the name Datigen.com, Inc. On August 25, 2005, the Registrant was redomiciled from Utah to Nevada pursuant to a merger with and into its wholly-owned subsidiary, Smart Energy Solutions, Inc., a Nevada corporation and, in connection therewith, its name was changed to Smart Energy Solutions, Inc.

Prior to the merger into its wholly-owned subsidiary, the Company was engaged in activities including development and marketing of various internet and internet related products and services, investment in real property related instruments, and providing concrete cutting and finishing services to construction sites seeking to comply with certain provisions of the American Disability Act of 1991. In November 2004, the Company had a change in control as a result of the purchase of a majority of the Company’s outstanding Common Stock by unaffiliated individuals.

In connection with the change in control, the Company determined to pursue other business opportunities and, as a result, on March 23, 2005, the Company entered into an asset purchase agreement with Purisys, Inc., a New Jersey corporation, and acquired the intellectual property rights and certain other assets relating to a product known as the “Battery Brain,” a device attached to a motor vehicle battery for the purpose of protecting the vehicle from battery failure and theft.

Following the purchase of the Battery Brain assets, the Company devoted its resources and entered into agreements with third parties for the manufacture and distribution of products using the Battery Brain technology. During the period from March 2005, the date of the asset purchase agreement, through the end of 2009, the Company devoted its efforts to marketing activities directed at the automotive industry, including automotive retail, dealers, OEMs, and automotive specialty such as fleets, military, heavy trucks and equipment, motor home/RV and marine.

The Company continued to generate losses from operations and, as of its fiscal year-ended December 31, 2008, the Company had an accumulated deficit of in excess of $22 million. While the Company continued to file reports under the Securities Exchange Act of 1934 (the “Exchange Act”) through its quarterly report on Form 10-Q for the period ended September 30, 2009, the Company lacked sufficient capital resources to continue to fund the expenses including professional fees associated with being a current, reporting company under the Exchange Act.

As a result, from and after the filing of its 10-Q for the period ended September 30, 2009, the Company ceased active business operations and determined to devote its limited and depleting cash resources to seek operations that would generate revenues and positive cash flow compared to its prior operations seeking to exploit its Battery Brain technology. The Company became delinquent in its reporting obligations under the Exchange Act, failing to file its annual report on Form 10-K for the year ended December 31, 2009 and continued to be a delinquent filer until it filed a Form 15, terminating its registration under Section 12(g) of the Exchange Act on July 24, 2013.

Prior to filing the Form 15, the Company’s assets became subject to a proceeding before the Superior Court of the State of New Jersey, which resulted in the appointment of a receiver in early 2013. The principal creditor in that proceeding was Aharon Levinas, who had sold the Battery Brain assets formerly owned by Purysis in March 2005. On June 7, 2013, in connection with the order of the Superior Court of the State of New Jersey, the Court authorized and approved the sale, transfer and assignment of all of the Company’s assets to Aharon Levinas, free and clear of any liens, claims or encumbrances and granting Mr. Levinas effective control of the Company.

During November 2014 and March 2015, third-party investors acquired control of the Company by purchasing a control block of shares each holding 137,500 shares representing 88% of the Company’s issued and outstanding shares of Common Stock. Reference is made to the disclosure under “Security Ownership of Certain Beneficial Owners and Management,” below.

17

Recent Corporate Developments

On August 30, 2017, a new wholly-owned subsidiary was registered in Israel under the name of Canna Powder Ltd. (“CannaPowder Israel” or the “Subsidiary”), with 100 common shares outstanding (the “Subsidiary Shares”), all of which were held in escrow on behalf of the Company by Israel attorney, Alon Nave. On September 27, 2017, pursuant to board resolution, the 100 Subsidiary Shares held in escrow were transferred to the Company.

The Subsidiary’s management includes Lavi Krasney, its CEO, and Rafi Ezra, its CTO. Reference is made to the disclosure under the subcaption “Key Employees” included in “Item 5. Directors and Executive Officers” below.

Development is being conducted at the Hebrew University under the supervision of the inventor of the technology, Professor Shlomo Magdassi, pursuant to the term of the Feasibility Study and Option Agreement dated September 14, 2017 (the “Feasibility Study”), a fully-executed copy of which was filed as Exhibit 10.1.2 to the Company’s Registration Statement on Form 10-12G/A on July 3, 2018, as more fully discussed below.

On December 27, 2017, a board resolution was adopted to issue an additional: (i) 800 Subsidiary Shares to the Company; and an additional 100 Subsidiary Shares to Rafi Ezra and, as a result, effective December 27, 2017, Canna Powder Ltd became a 90% owned subsidiary of the Company and a minority interest of 10% owned by Rafi Ezra.

The Equity Raise by the Company was and continues to be for the purpose of funding the Company’s business involving its development program to establish cannabis powder production facilities utilizing the proprietary, licensed technology as more fully-described under “Intellectual Property” below (the “Development Program”). Pursuant to the Company’s Development Program, we expect to have product formulation and testing completed in 2020, pre-clinical studies commencing in 2021, first human and safety trials in 2022 and efficacy trials in 2023. Reference is made to the disclosure under the “ The FDA Approval Process below. As a result, unless we are able to expedite the above timetable, of which there can be no assurance, the earliest that we can expect to begin commercial sales will be 2023. In fact, there can be no assurance that the Development Program will be successfully implemented within our expected timeline notwithstanding the Company’s success in its Equity Raise to date, nor can there be assurance that the Company may not require additional capital to fully implement its business plan and complete production of commercially viable products based on its technology which is the subject of the Feasibility Study discussed below under “ Planned Research and Development and Current Trends .” Reference is also made to Appendix B-1 attached to the License Agreement filed as an exhibit to our Form 8-K filed with the SEC on May 25, 2018. Reference is also made to the fully-executed copy of the License Agreement, attached at exhibit 10.2.2 hereto.

If and when we reach the commercial stage, of which there can be no assurance, the Company’s plan is to establish and operate several production facilities to be located in countries/territories determined by the Company according to their size and provided that the applicable regulatory environment that permits studies applicable to other activities prerequisite to commercial exploitation of medical cannabis generally and the Company’s plan to develop cannabis-based powders for medical uses. The Company believes that it will be able to produce cannabis powders for medical uses at a cost advantage. Notwithstanding our belief in our ability to produce cannabis powders for medical uses at a cost advantage, in fact, to date we have not produced and cannabis powders for medical or any other uses and there can be no assurance that: (i) we will ever be able to produce commercially viable cannabis powders for medical uses; (ii) any cannabis we produce, either alone or in collaboration with third parties, will be accepted by the medical community, either in Israel or anywhere else in the world; (iii) any cannabis powders will be produced at a cost advantage; or (iv) we will be able to successfully compete with established companies in the medical cannabis industry, virtually all of which have far longer operating histories and far greater capital resources.

Planned Research and Development and Current Trends

We believe that there has been an increasing recognition amongst medical professionals conducting research in hospitals, including leading hospitals in Israel such as Hebrew University, Jerusalem, Israel and Sheba Academic Medical Center located in Tel Hashomer, Israel, among others, that the therapeutic effect of medical cannabis is due to the total number of cannabinoids working together. There is a scientific effort currently being conducted in Israel, as well as other countries, to analyze and understand how the various components within cannabis work, including ongoing scientific studies to develop separate medical components for use in treatment of different medical conditions using various components or combinations for each cannabinoid. Nevertheless, the laws of the United States presently do not permit studies to be conducted in hospitals in the U.S. notwithstanding approval of medical and recreation cannabis in 29 of the 50 states.

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The aim of CannaPowder Israel is to identify the active pharmaceutical ingredient (API) and to endeavor to understand the cannabidiol (CBD) and tetrahydrocannabinol (THC) content of each product. Researchers, principally in Israel, have discovered approximately in excess of 100 cannabinoids, chemical compounds unique to the cannabis plant. The most common are CBD, cannabinol (CBN) and THC. CBN and THC interact with CB1 and CB2 receptors, which are located throughout the human

The above information was disclosed in a filing to the SEC. To see the filing, click here.

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