Antonia Chion
Kevin P. O'Rourke (KO 1056)
Scott W. Friestad (SF 8048)
Robert G. Wilson (RW 9147)
Patrick L. Feeney (PF 2733)
Securities and Exchange Commission
450 Fifth Street, NW
Washington D.C. 20549-0911

UNITED STATES DISTRICT COURT
FOR THE SOUTHERN DISTRICT OF NEW YORK

Plaintiff Securities and Exchange Commission ("Commission") alleges the following:

SUMMARY

1. This case involves fraud in connection with a June 2000 initial public offering ("IPO") by busybox.com, Inc. ("busybox"). The fraud was orchestrated by defendants Thomas T. Prousalis, Jr., securities counsel to busybox, and Robert T. Kirk, Jr., the majority owner and president of Barron Chase Securities, Inc. ("Barron Chase"), the lead underwriter for the IPO. Barron Chase agreed to underwrite a firm commitment offering that would raise approximately $12.8 million for busybox. After informing busybox that Barron Chase was having difficulty selling the IPO securities to bona fide investors, Prousalis and Kirk devised and executed afraudulent scheme to complete the offering. They arranged for several busybox insiders to "purchase" IPO securities using undisclosed "bonuses," and for Prousalis to receive an inflated and undisclosed legal fee paid in IPO securities. Barron Chase secretly financed these transactions and, during the IPO closing, Prousalis and Kirk caused busybox to repay Barron Chase out of the proceeds of the offering. The scheme gave Prousalis and the insiders almost 20% of the securities being offered in the IPO, and reduced the proceeds available to busybox by over $2.1 million.

2. The busybox Registration Statement and Prospectus ("Registration Statement") did not disclose the insider stock purchases or Prousalis's inflated fee. The Registration Statement did not disclose Barron Chase's role in financing these transactions, or the fact that, as a result of the scheme, the proceeds of the IPO available to the company for the business purposes stated in the Registration Statement would be reduced by over $2.1 million. The Registration Statement falsely stated that Prousalis's fees and expenses for legal services associated with the IPO were "estimated" to be $375,000, when in fact Prousalis billed and received more than $1.25 million. The scheme rendered materially false and misleading those sections of the Registration Statement discussing the nature and expenses of the underwriting, the plan of distribution, the amount and use of proceeds, the compensation of executives, and the extent of insider ownership of busybox.

3. Prousalis was the primary drafter of the materially false and misleading Registration Statement, which he caused to be filed with the Commission for public dissemination, and which he caused to be delivered to the National Association of Securities Dealers, Inc., the Standard & Poors stock rating service, and to others. Kirk and his securitiesfirm participated in the preparation of the materially false and misleading Registration Statement and delivered copies of it to numerous bona fide investors in the IPO, to potential investors and to other members of the public.

4. Prousalis and Kirk both benefitted financially from the fraud. Prousalis's retainer agreement and Barron Chase's underwriting agreement both called for payment out of the proceeds of the IPO and were, in effect, contingent upon the close of the IPO. By carrying out the fraudulent scheme, Prousalis and Kirk's firm reaped fees of over $1.25 million and $1.5 million, respectively.

5. By knowingly or recklessly engaging in the conduct described herein, defendant Prousalis, directly or indirectly, violated or aided and abetted violations of Section 17(a) of the Securities Act of 1933 ("Securities Act") [15 U.S.C. § 77q(a)] and Sections 10(b) and 13(d) of the Securities Exchange Act of 1934 ("Exchange Act") [15 U.S.C. §§ 78j(b) and 78m(d)], and Rules 10b-5, 13d-1, and 13d-2 thereunder [17 C.F.R. §§ 240.10b-5, 240.13d-1, 240.13d-2].

6. By knowingly or recklessly engaging in the conduct described herein, defendant Kirk, directly or indirectly, violated Section 17(a) of the Securities Act [15 U.S.C. § 77q(a)] and Section 10(b) of the Exchange Act [15 U.S.C. § 78j(b)], and Rule 10b-5 thereunder [17 C.F.R. § 240.10b-5].

7. Unless restrained and enjoined, defendants Prousalis and Kirk will violate the federal securities laws.

8. The Commission brings this action for an order permanently enjoining the defendants from future violations, and granting disgorgement of ill-gotten gains from the unlawful conduct described in this Complaint, and other relief, pursuant to Sections 20(b) and20(d)(1) of the Securities Act [15 U.S.C. §§ 77t(b) and 77t(d)(1)] and Sections 21(d)(1) and 21(e) of the Exchange Act [15 U.S.C. §§ 78u(d)(1) and 78u(e)].

9. The Commission also brings this action for an award of civil penalties pursuant to section to Section 20(d) of the Securities Act [15 U.S.C. § 77t(d)], and Section 21(d)(3) of the Exchange Act [15 U.S.C. § 78u(d)(3)].

JURISDICTION

10. This Court has jurisdiction over this action pursuant to Section 22(a) of the Securities Act [15 U.S.C. § 77v(a)], and Sections 21 and 27 of the Exchange Act [15 U.S.C. §§ 78u and 78aa)].

11. The defendants, directly or indirectly, used the means and instrumentalities of interstate commerce, or of the mails, or the facilities of a national securities exchange in connection with the acts, practices, and courses of business alleged herein.

DEFENDANTS

12. Thomas T. Prousalis, Jr., age 55, is a resident of McLean, VA and is an attorney admitted to practice in the District of Columbia. Prousalis served as securities counsel to busybox and purported to provide legal advice to busybox in connection with the busybox IPO.

13. Robert T. Kirk, Jr., age 46, is a resident of Parkland, FL and was President and Chief Executive Officer of Barron Chase, a broker-dealer of securities headquartered in Boca Raton, Florida. Kirk owned over 90% of Barron Chase through his wholly owned holding company, Continental Financial Network, Inc. Barron Chase ceased operations in November 2000 and is now defunct. By virtue of his ownership, Kirk exercised control over and directed the activities of Barron Chase with respect to the busybox IPO.

RELATED ENTITIES

14. busybox is a defunct Delaware corporation that was headquartered in Century City, California and that filed a Chapter 7 bankruptcy petition in the Central District of California on July 30, 2001. Busybox sold still photographs, film footage and video over the Internet. Following the IPO, busybox's securities traded on the NASDAQ Small Cap Market, a nation-wide electronic trading system.

15. Barron Chase was a Colorado corporation and a broker-dealer with its principal place of business in Boca Raton, Florida, and other offices in New York, California, and elsewhere. One of Barron Chase's primary business activities was providing investment banking services to corporations seeking to raise money from the public. Kirk was the head of investment banking at Barron Chase and was responsible for all significant investment banking duties relating to IPOs.

FACTUAL ALLEGATIONS

Retention of Prousalis and Barron Chase by busybox

16. Starting in or about the middle of 1998, the officers and directors of busybox decided that the company should seek to raise money by selling securities to the public. Towards this end, in or about December 1998, busybox officers met with Prousalis in New York City. Busybox retained Prousalis, who held himself out as a securities law expert who could provide legal services and assistance in raising money from the public. Prousalis played an active role in securing private loans for busybox and in soliciting investors for private sales of busybox securities. At Prousalis's behest, busybox hired associates of Prousalis to be officers anddirectors of busybox. Prousalis and Kirk devised the busybox IPO, and Prousalis carried out or directed most of the activities necessary for busybox to complete the IPO.

17. The retainer agreement between Prousalis and busybox, dated December 9, 1998, required busybox to make payments to Prousalis if busybox raised funds through the sale of securities in a private placement or a public offering. Upon the close of an IPO, the retainer agreement required busybox to pay Prousalis $375,000 or 7 ½% of the gross proceeds of the offering, whichever was greater, plus expenses. In or about September 1999, a copy of this retainer agreement was provided to Barron Chase as part of its underwriter's due diligence investigation of busybox.

18. In or about April 1999, Prousalis arranged to have busybox retain Barron Chase as the lead managing underwriter for an IPO of busybox securities. Prousalis, Kirk and others prepared a letter of intent and a draft underwriting agreement that called for Barron Chase to purchase the entire IPO — an arrangement known as a "firm commitment." However, the final underwriting agreement was not executed until the Commission declared the Registration Statement effective in June 2000. In the final agreement, busybox agreed to sell the IPO securities to Barron Chase at an underwriter's discount of 9% and to pay Barron Chase a further "expense allowance " of 3% of the gross proceeds.

The Registration Statement

19. In connection with the busybox IPO, Prousalis drafted and caused to be filed with the Commission the busybox Registration Statement, which included several amendments. The final version was filed on or about May 23, 2000. (Registration Statements filed with the Commission are public documents and are available for review at the Commission's offices,through the Commission's Internet web site, and through commercial web sites.) The Commission staff issued comments on the initial busybox Registration Statement and the subsequent amendments, and Prousalis prepared replies to those comments on behalf of busybox in the form of correspondence to the Commission staff and in the form of amendments to the Registration Statement. The final busybox Registration Statement, in the form of a prospectus, was primarily distributed to investors by Kirk and by Barron Chase at Kirk's direction. Copies of the Registration Statement were also provided to the National Association of Securities Dealers, and to the Standard & Poors stock rating service and the Depository Trust Company, in New York City.

20. According to the final version of the Registration Statement:

a. busybox offered to sell to the public 2,500,000 shares of common stock at $5.00 per share, and 2,500,000 warrants at $.125 per warrant.

b. The total amount to be raised, before deducting expenses incurred in connection with the IPO, such as underwriting and other fees, (the "Gross Proceeds") was $12,812,500.

c. The estimated proceeds that busybox expected to receive, after deducting the underwriter's fee and other IPO related expenses (the "Net Proceeds"), was $10,431,250.

d. Barron Chase, the underwriter, agreed to purchase "all of the securities offered" at $4.55 per share and $.11375 per warrant; the difference between these prices and the prices paid by the public represented Barron Chase's 9% selling commission.

f. Included among the expenses to be incurred by busybox in connection with the IPO, and to be paid from the proceeds of the IPO, were "Legal Fees and Expenses," which were "estimated" at $375,000.

g. busybox intended to use the Net Proceeds as follows:

21. By agreeing to a firm commitment underwriting, Barron Chase assumed the economic risk of selling the IPO, because the firm commitment obligated Barron Chase to buy all of the shares in the offering, regardless of whether it was able to re-sell those shares to bona fide investors. A "firm commitment" underwriting thus differs from a "best-efforts" underwriting. In a "best efforts" offering the underwriter is not obligated to buy all of the issuer's shares, but is instead only required to use its best efforts to sell as many shares as possible. The terms of the underwriting are material to potential investors for a number of reasons, including the fact that in a firm commitment underwriting, the terms of the underwriting assure that all shares being offered by the issuer will be purchased and therefore the issuer will raise all of the capital set forth in the prospectus to fund its future operations.

The Fraudulent Scheme

22. In or about the middle of June 2000, after the final version of the Registration Statement was filed with the Commission, Prousalis and Kirk finalized their fraudulent scheme to close the IPO. The scheme called for Prousalis and several busybox insiders secretly to receive approximately $2.5 million worth of IPO securities, and for IPO proceeds secretly to be diverted back to Barron Chase to pay for these securities. In connection with the scheme, Prousalis and Kirk represented to busybox officers that Barron Chase was short of selling out the IPO and that Barron Chase was unlikely to sell out the IPO to bona fide investors by the effective date of the busybox Registration Statement. Prousalis and Kirk arranged for busybox insiders, including the President, Chief Financial Officer and General Counsel, to receive IPO securities.

23. As part of the scheme, Prousalis would receive a grossly inflated legal fee of approximately $1.26 million from busybox. This was much larger than the fee he was entitled to receive under his retainer agreement and much larger than the estimated legal fee disclosed in the Registration Statement. The fee would be paid for with IPO securities. In order to finance the payment of the fee, Barron Chase would secretly advance IPO securities to Prousalis, and busybox would secretly pay Barron Chase for those securities by having an amount equal to Prousalis's legal fee deducted from the IPO proceeds. The Registration Statement did not disclose the inflated amount of Prousalis's legal fee, how the fee would be financed, or the fact that it would be paid for with IPO securities.

24. The scheme also called for busybox insiders to "purchase" $1.25 million worth of IPO securities, but without spending any of their own money. In order to finance these purchases, Barron Chase would secretly advance IPO securities to the insiders, and busyboxwould secretly pay Barron Chase for those securities by having an amount equal to the value of the purchases deducted from the IPO proceeds. To avoid having to spend their own money, the busybox insiders, under the direction of Prousalis, caused the company's board of directors to authorize the payment of bonuses to themselves in amounts which exactly equaled the value of the IPO securities they received. The insiders then authorized Barron Chase to deduct those amounts from the IPO proceeds. The Registration Statement did not disclose the existence of these bonuses, how they were financed, or the fact that they would be used to purchase IPO securities.

25. On June 19, 2000, at Kirk's direction and with his assistance, Prousalis and the busybox insiders opened cash brokerage accounts at Barron Chase, with Kirk as the registered representative for each account. At no time, however, did Prousalis or the busybox insiders ever deposit any personal funds into these accounts.

26. The busybox Registration Statement was declared effective by the Commission at 5:00 p.m. on June 26, 2000. On or about June 26, 2000, Kirk, on behalf of Barron Chase, executed the Underwriting Agreement between Barron Chase and busybox, in which Barron Chase agreed to underwrite the busybox IPO on a firm commitment basis. By that time, however, Kirk and Prousalis knew, or were reckless in not knowing that, because of the fraudulent scheme, Prousalis and the busybox insiders were going to receive roughly $2.5 million of the IPO securities, that IPO proceeds would be diverted back to Barron Chase to pay for those securities, and that therefore Barron Chase was not underwriting the IPO on a true "firm commitment" basis for the amount stated in the Registration Statement.

27. On June 27, 2000, the busybox IPO took place and its securities were listed on the NASDAQ Smallcap Market and became available for trading on the open market. Barron Chase representatives sold IPO securities to bona fide investors in New York, California, the District of Columbia, and elsewhere.

28. According to the terms of Prousalis's retainer agreement with busybox, Prousalis was entitled to a fee of $960,937.50 (7 ½ % of the Gross Proceeds), plus expenses. In fact, and pursuant to the fraudulent scheme, on June 26, 2000, Prousalis submitted a bill to busybox for $1,255,625.00 for his legal services. Prousalis attempted to disguise his part in the scheme by subdividing his bill into several categories. Despite their knowledge of the much larger fee that Prousalis was entitled to receive under his retainer agreement, and despite their knowledge of the actual bill submitted by Prousalis to busybox before the IPO opened, Prousalis and Kirk caused the Registration Statement to be circulated to investors and the public, which falsely represented that the legal fees and expenses of the IPO were estimated to be only $375,000.

29. In the IPO, on June 27, 2000, Kirk caused 488,000 IPO common shares, and an equal number of warrants, secretly to be allocated to the Barron Chase accounts of Prousalis and eight busybox insiders. This was slightly less than 20% of all the securities offered in the IPO. Prousalis received securities valued at $1,255,625. The eight busybox insiders received securities valued at $1,245,375 in the aggregate. Barron Chase accounted for the transactions on its books and records as "purchases." Because Prousalis and the busybox insiders had not deposited any funds into their Barron Chase accounts, however, the accounts simultaneously reflected large negative balances equal to the value of the securities allocated. For example, on June 30, 2000 (the trade settlement date for the IPO allocations made on June 27, 2000),Prousalis's Barron Chase account reflected a purchase of 245,000 common busybox shares and 245,000 warrants, for a total price of $1,255,625 and, since no funds had been deposited into the account, a negative balance of $1,255,625. The Barron Chase accounts of the officers who received IPO securities pursuant to Prousalis's and Kirk's scheme reflected similar activity that day.

30. The following Monday, July 3, 2000, Barron Chase's clearing agent, FISERV Correspondent Services, Inc. ("FISERV"), closed the IPO on its books and distributed the proceeds. On or around June 30, 2000, busybox and its board of directors, at Prousalis's direction, instructed FISERV to divert $2,388,250 from the IPO proceeds and to deliver that money not to busybox, as disclosed in the Registration Statement, but directly to the Barron Chase accounts of Prousalis and six busybox insiders. On or around July 3, 2000, Barron Chase, at Kirk's direction, sent similar instructions to FISERV: to reduce the payout to busybox by $2,388,250 and to credit those funds against the negative balances in the Barron Chase accounts of Prousalis and the six busybox insiders.

31. FISERV complied with the instructions of busybox and Barron Chase. In closing the IPO, FISERV first aggregated the credits of Barron Chase on its books to purchase the IPO securities from busybox; Barron Chase thus carried out its "firm commitment" to buy all of the IPO, but only for a very short time. The IPO securities were then distributed to Barron Chase's customer accounts -- including Prousalis and the busybox insiders, even though they had not paid for their securities. In effect, this was a loan from Barron Chase to Prousalis and the busybox insiders equal to the value of the securities they had received. Prior to delivering the IPO proceeds to busybox, FISERV then made a series of journal entries that transferred $2,388,250from the IPO proceeds to the accounts of Prousalis and the six busybox insiders, pursuant to the instructions received from Prousalis and Kirk. These journal entry transfers bypassed busybox altogether and paid for the IPO securities that had been allocated to Prousalis and the busybox insiders and brought their account balances to zero. The rest of the IPO proceeds, after other expenses and payments, was approximately $6 million, and this amount was wired to busybox's corporate bank account.

32. In addition, and as a part of the overall scheme, on July 3, 2000, Barron Chase, at Kirk's direction, loaned $112,750 in cash to two additional busybox officers in order to fund their allocation of IPO securities. This money was transferred from a Barron Chase non-customer account to the accounts of the two additional busybox officers and was used to pay for the securities allocated to these two busybox officers in the IPO. On or about July 7, 2000, busybox repaid this loan from Barron Chase, using IPO proceeds which it had received on July 3, 2000.

33. The July 7, 2000, repayment of the $112,750 loan, and the journal entries on July 3, 2000, that diverted $2,388,250 from the IPO proceeds due busybox, reduced the overall IPO proceeds available to busybox by $2,501,000. Since the Registration Statement did not disclose that busybox insiders would be receiving bonuses from IPO proceeds, or that Prousalis would be receiving an inflated fee from IPO proceeds, the scheme used $2,126,000 in a manner that was not disclosed to the public. The undisclosed use of proceeds equaled the amount of the secret bonuses given to the insiders ($1,245,375) and the undisclosed amount of Prousalis's bill ($880,625).

34. For its work in connection with the IPO, Barron Chase received its 9% underwriter's commission and 3% expense allowance, for total compensation of $1,537,500. As noted above, Prousalis received $1,225,625 worth of busybox IPO securities. Prousalis sold his busybox IPO securities on or about September 3, 2000. Barron Chase ceased operations in or around November 2000. Busybox filed a Chapter 7 bankruptcy petition in the U.S. District Court for the Central District of California in July 2001.

35. The Registration Statement did not disclose any aspect of the above described fraudulent scheme or the fact that the proceeds of the IPO available for the legitimate business purposes of the company were going to be over $2.1 million less than disclosed in the Registration Statement.

36. Prousalis and Kirk devised, directed and executed the above-described fraudulent scheme. The scheme defrauded busybox investors by, among other things, secretly reducing by $2,126,000 the proceeds available to busybox upon the close of the IPO (reducing the Net Proceeds by 20.1% and the Gross Proceeds by 16.6%), thereby misleading investors as to the financial health and future viability of busybox.

False and Misleading Statements and Omissions in the Registration Statement

37. Through the creation and distribution of the busybox Registration Statement, Prousalis and Kirk made materially false and misleading statements and omissions to investors and the public with regard to the nature of the underwriting. Prousalis and Kirk falsely stated that Barron Chase was underwriting the busybox IPO on a firm commitment basis for $12,812,500 when they knew, or were reckless in not knowing that, because the fraudulent scheme called for offering proceeds to be diverted back to Barron Chase, Barron Chase wouldnot in fact be conducting the underwriting on a true "firm commitment" basis for the amount stated.

38. Through the creation and distribution of the busybox Registration Statement, Prousalis and Kirk made materially false and misleading statements and omissions to investors and the public with regard to the plan of distribution and to the amount of money the IPO would raise for busybox. Prousalis and Kirk knowingly or recklessly failed to disclose that: (1) Prousalis and the busybox insiders would receive almost 20% of the stock and warrants offered in the IPO; and (2) by diverting offering proceeds from busybox to pay for the securities allocated to Prousalis and the insiders, the Net Proceeds available to busybox upon completion of the IPO would be approximately $2.1 million less than the $10.4 million disclosed in the Registration Statement.

39. Through the creation and distribution of the busybox Registration Statement, Prousalis and Kirk made materially false and misleading statements and omissions to investors and the public with regard to how busybox planned to spend the money raised in the IPO. Prousalis and Kirk knowingly or recklessly stated falsely that busybox intended to spend the money raised in the IPO on, among other things, web site development, mergers and acquisitions, capital equipment, marketing and sales. In fact, after the secret diversion of IPO proceeds back to Barron Chase, Prousalis and Kirk knew or were reckless in not knowing that busybox would not have sufficient funds to spend for the legitimate business purposes stated in the Registration Statement in the amounts promised, if at all.

40. Through the creation and distribution of the busybox Registration Statement, Prousalis and Kirk made materially false and misleading statements and omissions to investorsand the public with regard to the compensation of busybox officers and directors. Prousalis and Kirk knowingly or recklessly failed to disclose in the Registration Statement that bonuses would be paid to the busybox insiders as part of the scheme to complete the IPO.

41. Through the creation and distribution of the busybox registration statement, Prousalis and Kirk made materially false and misleading statements and omissions to investors and the public with regard to the percentage of busybox owned by the company's officers and directors. Prousalis and Kirk knowingly or recklessly failed to disclose in the Registration Statement the increase in insider ownership of busybox caused by the allocation of roughly 10% of the IPO to eight busybox insiders.

42. Through the creation and distribution of the busybox Registration Statement, Prousalis and Kirk knowingly or recklessly made materially false and misleading statements and omissions to investors and the public with regard to the IPO legal fees and associated expenses. Prousalis and Kirk knowingly or recklessly stated falsely that, among the expenses to be incurred by busybox in connection with the IPO, and to be paid from the proceeds of the IPO, were "Legal Fees and Expenses," estimated to total $375,000. Prousalis and Kirk knew, or were reckless in not knowing, that Prousalis was entitled to a much larger fee pursuant to his retainer agreement with busybox, and that Prousalis had in fact submitted a bill to busybox, prior to the distribution of the Registration Statement to investors and the public, for $1,255,625 (which was $880,625 more than the amount disclosed in the Registration Statement), and that busybox would pay this bill using IPO securities.

CLAIMS

FIRST CLAIM
Defendants Violated Section 17(a) of the Securities Act

43. Plaintiff repeats and realleges Paragraphs 1 through 42 above.

44. Defendants, in the offer or sale of securities, by the use of means or instrumentalities of interstate commerce or of the mails, directly or indirectly (a) employed devices, schemes or artifices to defraud; (b) obtained money or property by means of untrue statements of material fact or omissions to state material facts necessary in order to make the statements made, not misleading; or (c) engaged in transactions, practices or courses of business which operated or would operate as a fraud or deceit upon other persons, including purchasers of busybox securities.

45. By reason of the conduct described herein, the defendants Prousalis and Kirk each violated Section 17(a) of Securities Act.

SECOND CLAIM
Defendants Violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder

46. Plaintiff repeats and realleges Paragraphs 1 through 45 above.

47. Defendants, in connection with the purchase or sale of securities, by the use of means or instrumentalities of interstate commerce, or of the mails, directly or indirectly, (a) employed devices, schemes or artifices to defraud; (b) made untrue statements of material fact or omitted to state material facts necessary in order to make the statements made, in the light of the circumstances under which they were made, not misleading; or (c) engaged in acts, practices orcourses of business which operated or would operate as a fraud or deceit upon other persons, including purchases and sellers of busybox securities.

48. By reason of the conduct described herein, defendants Prousalis and Kirk each violated Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.

THIRD CLAIM
Prousalis Violated Section 13(d) of the Exchange Act and Rules 13d-1 and 13d-2 Thereunder

49. Plaintiff repeats and realleges Paragraphs 1 through 48 above.

50. Section13(d) of the Exchange Act and Rules 13d-1 and 13d-2 promulgated thereunder require any person who acquires beneficial ownership of more than 5% of any equity security registered pursuant to Section 12 of the Exchange Act to, within ten days: (i) file a Schedule 13D with the Commission, and; (ii) send to the issuer of such security, and each exchange where such security is traded, a statement describing the purchases and other information. Section 13(d) also requires amendments to Schedule 13D if there is a material change in the person's beneficial ownership position.

51. On or about June 30, 2000, by virtue of his secretly receiving busybox securities in the IPO, Prousalis then owned over 5% of the outstanding common stock of busybox. The common stock of busybox is registered pursuant to Section 12 of the Exchange Act. On or about September 3, 2000, Prousalis sold all of the busybox securities he acquired in the IPO. Prousalis never filed any Schedule 13D with the Commission disclosing his beneficial ownership of busybox securities, nor has he filed with the Commission any amendments disclosing a material change in his position in busybox securities.

52. By reason of the foregoing, Prousalis violated Section 13(d) of the Exchange Act and Rules 13d-1 and 13d-2 promulgated thereunder.

FOURTH CLAIM
Prousalis Aided and Abetted busybox's Violations of Section 10(b) of the Exchange Act and Rule 10b-5 Thereunder

53. Plaintiff repeats and realleges paragraphs 1 through 52 above.

54. As a consequence of the fraudulent scheme described herein, the busybox IPO Registration Statement contained materially false and misleading statements and omissions.

55. By reason of the forgoing, busybox and others violated Section 10(b) and Rule 10b-5 thereunder.

56. Section 20(e) of the Exchange Act [15 U.S.C. § 78t(e)] provides that a person who knowingly provides substantial assistance to another person in violation of the Exchange Act, or any rule or regulation issued under the Exchange Act, shall be deemed to be in violation of such provision to the same extent as the person to whom such assistance is provided.

57. Defendant Prousalis knowingly provided substantial assistance to busybox and others in connection with the company's violations of the aforesaid provisions relating to the Registration Statement.

58. By reason of the forgoing, and pursuant to Section 20(e) of the Exchange Act, defendant Prousalis aided and abetted violations of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder.

PRAYER FOR RELIEF

WHEREFORE, Plaintiff respectfully requests that this Court enter a final judgment:

(a) against defendant Kirk:

(i) permanently enjoining him from, directly or indirectly, violating Section 17(a) of the Securities Act and Section 10(b) of the Exchange Act and Rule 10b-5 thereunder;

(ii) ordering him to disgorge all ill-gotten gains, together with prejudgement interest; and

(iii) ordering him to pay civil penalties pursuant to Section 20(d) of the Securities Act and Section 21A of the Exchange Act;

(b) against defendant Prousalis:

(i) permanently enjoining him from, directly or indirectly, violating or aiding and abetting violations of Section 17(a) of the Securities Act and Sections 10(b) and 13(d) of the Exchange Act and Rules 10b-5, 13d-1 and 13d-2 thereunder;

(ii) ordering him to disgorge all ill-gotten gains, together with prejudgement interest; and

(iii) ordering him to pay civil penalties pursuant to Section 20(d) of the Securities Act and Section 21A of the Exchange Act; and

(c) granting such further relief as this Court deems just and proper.

Washington, D.C.

http://www.sec.gov/litigation/complaints/comp18533.htm