Symptoms

We are unable to install K2 Blackpearl 4.6.11 Development license with the key generated on portal.k2.com site. The error says "Invalid license key", however the key properly validates in Workspace. Since we want to do a fresh install on new development environment, we are unable to use the key.
 

Diagnoses

See resolution
 

Resolution

We have deleted a file from the GAC called SouceCode.HostServerIntefaces and this allowed the K2 Setup Manager to continue without any issues.