provider. Many providers are currently offering incentives to children and families to enroll with them and some are offering incentives to schocls as well. The key challenge in marketing the SES programs to families is offering something that is appropriate and that will add educational value for families while enticing the children to participate. KLC OpCo believes there is a much larger number of children eligible for services than the number that attend programs and therefore an opportunity exists to improve marketing and outreach to families. identifying prospects involves targeting urban areas where there is a cluster of failing schools. Failing schools are schools that fail fo meet established NCLB requirements for three years in a row. After the second year of failure the schools have to offer several services in order to prevent being named a failing school. This enables KLC OpCo to project the approximate number of schools that will be considered failing in the next school year and help identify states to pursue and markets that warrant further attention. KLC OpCo is currently authorized to provide SES in 19 states and has already begun providing SES in five of them. KLC OpCo believes the SES business provides an opportunity for growth. On August 29, 2006, KLC acquired 100% of the membership interests in Education Station, LLC ("Education Station") from Catapult Learning LLC ("Catapult"), a subsidiary of Educate, Inc. (together with Catapult, "Educate") Education Station is a private provider of supplemental educational services under the NCLB and other educational instruction and after school services. The purchase agreement provides for an aggregate purchase price of $6.0 million with $3.0 million paid into escrow at closing, and $1.0 million payable on each of the first three anniversaries of the closing date. The amount in escrow is payable to Educate on three specific dates during the period beginning ninety days from the closing date and ending on Ju