CyberKey Solutions fka CKYS

[Sylvrewynde]

The key to the "never registered" claim is here:

"33. At the time these shares were issued, no registration statement was in effect with regard to any public sale of the securities at issue, no exemption claimed by the Defendants or otherwise, was applicable, and no public disclosure of the issuance, distribution, or intent to sell the shares into the market was made." (emphasis added)
http://www.sec.gov/litigation/complaints/2007/comp20049.pdf

Shares of CyberKey were being sold based on the company's claim that it qualified for exemption from registration (see the RegDex filing at sec.gov). Unfortunately for CyberKey, a company that has more than $10,000,000.00 in assets and 500 shareholders MUST report to the SEC. You'll recall that CyberKey also claimed stock sales in excess of the $1,000,000.00 maximum that a company can obtain from the 504 exemption annually. As I pointed out some time ago, the 505 and 506 exemptions couldn't be applicable because the number of shareholders is more than 35.

The part about the public disclosure in re the distribution and/or intent to sell would be applicable if any potential defendant claimed that the shares THEY had were from some separate alternate exemption. Such an exemption generally restricts the sale of such stock absent the disclosures listed.