Check that your Windows User has Full Read/Write access rights to your Toad install directory folder. By default it is C:\Program Files\Quest Software\Toad for Oracle\. Toad needs to create the "QSAuth11.key" file in that directory. If you do not have rights or privileges to that directory, please have your System or Network Administrators give your Windows User Full Read / Write access rights to the said directory OR give your user the Power User Rights.
If you do have the rights or privileges, go to the directory and create an empty file with the name “QSAuth11.key”. Then try registering the key again.
Uninstall Toad and reinstall again as a new install.