True Product ID Inc.(fka TPID)

[johncee]

FYI,

If anyone can decifer this and explain exactly what they mean, let me know. I called a few of my atttorney friends and they said to look up the exact issues tpdi and ssty are working with the sec on in order to get our shares unrestricted, it appears that the spin off dates and actual ownership dates are different and that is why we have to wait till Sept 13th, but I could be wrong because I have not dived into what this all means yet. I will work on it over the next few days and make a few calls to clarify my findings.

Best Regards

Johncee

To All True Product ID (“TPID”) Shareholders who Received Restricted Common Shares ("Spin-Off Shares" or "Shares") from the Spin-Off of Sure Trace Security Corporation (“SSTY”)
This is to notify you that TPID’s attorneys have numerous conversations with the United States Security and Exchange Commission (“SEC”), Division of Corporation Finance about the conditions for release of the Rule 144 restrictions from TPID Shares distributed in the SSTY spin-off. The SEC announced on September 13, 2007 that it had settled an action against Sure Trace Security Corporation and determined that all TPID Spin-Off Shares issued in the SSTY spin-off were distributed in violation of the registration requirements of the Securities Act of 1933 (“Act”). The details of this SEC ruling can be read in SEC Litigation Release No. 20277, which is accessible in the hyperlink below.
The SEC has taken the position that the Spin-Off Shares are the product of a series of transactions that involved violations of the registration requirements (Section 5) of the Securities Act of 1933 (the "Act"). As a result, both TPID and any seller of Spin-Off Shares are subject to the express liability provisions of Sections 12(a) (1) and 12(a) (2) of the Act. Under these sections, a purchaser of Spin-Off Shares can sue the selling TPID shareholder for rescission of the sale as well as damages. TPID can also be sued for damages as part of these statutory rights. Any post-sale fluctuation in the price of TPID’s stock can trigger these rights to rescission and damages.
The Section 12(a) (2) liability exists for one year from the date a purchaser of Spin-Off Shares discovers, or should have discovered, the Section 5 violation. In our situation, a purchaser of Spin-Off Shares should have known about the violation as of September 13, 2007, the date of SEC Litigation Release No. 20277. TPID’s present management has been made aware that prior to receiving the opinion from our counsel, that some Spin-Off Shares had restrictions removed in the past. The SEC advises that this fact does not change their assessment that the Spin-Off Shares are subject to the one year liability period imposed by Section 12.
In conversations with our attorneys, the SEC stated that the Rule 144 restrictions on the Spin-Off Shares should not be removed until the one year liability period has lapsed. To ensure that TPID shareholders and TPID are not exposed to the express liability provisions of Section 12(a), TPID, on the advice of special securities counsel, will presently defer all requests to remove restrictive legends from Spin-Off Share certificates until after September 13, 2008. That date marks the end of the one-year liability period described above.
TPID has been advised by the representatives of Sure Trace Security Corporation (SSTY), who participated in the dividend and subsequent SEC proceedings related thereto, that there may be facts and information relating to the dividend and subsequent SEC proceedings which may impact the issues surrounding the removal of the restrictive legend on the dividend shares. So that SSTY’s issues are given proper consideration, the Company formally invites SSTY to present whatever facts and information it may have to the SEC, to make its arguments to the SEC, and to request that the SEC reconsider the
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matter. This is especially appropriate because it was SSTY, not the Company, that conceived, handled, and implemented the dividend, and because it was SSTY, not the Company, who was the named in the SEC Complaint.
We apologize for this situation; however, we are acting upon advice of special securities counsel and upon consultation with the SEC. We believe this course of action is best for TPID and all shareholders who received Spin-Off Shares in the described transactions
http://www.sec.gov/litigation/litreleases/2007/lr20277.htm
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