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Schaffer Third Party Complaint and Counter Complaint

Schaffer Third Party Complaint and Counter Complaint

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District Court, City and County of Denver, Colorado 1437 Bannock Street Denver, Colorado 80202 (702) 865

-8301 PLAINTIFF: ALL PRO SPORTS AND ENTERTAINMENT, INC., a Colorado corporation, v. DEFENDANTS: PETER J. SCHAFFER, an individual and JOHN RICKERT a/k/a JR RICKERT, an Individual, AUTHENTIC ATHLETIX, LLC, A Limited Liability Company. Third Party Defendants v. C. Lamont Smith Individual, Damien Moore and ALL PRO SPORTS AND ENTERTAINMENT, INC., a Colorado corporation,

Peter Schaffer 400 South Steele Street, 47 Denver, Colorado 80209 FAX Number: (303) 288-0988 Peterschaffer8@gamil.com Atty. Reg. #: 17042

 COURT USE ONLY  Case Number: Division:

THIRD PARTY COMPLAINT AND COUNTER COMPLAINT COMES NOW, Peter Schaffer, the defendant pro se and as a duly licensed attorney in the state of Colorado , the Shareholders of All Pro Sports & Entertainment, Inc., including Peter Schaffer by and through their counsel of record, Peter J. Schaffer, Attorney at law, Authentic Athletix and John Rickert herby files and submits the below Counter Complaint against APSE, its majority shareholder, Board of Directors, and C. Lamont Smith, individually states and alleges as follows;

1. The Court has jurisdiction over the parties and the subject matter of this action because all parties are either residents of Colorado, have transacted business in Colorado, and/or the defendant has committed tortuous acts in Colorado. 2. Venue is proper in this Court pursuant to C.R.C.P. 98 because the parties agreed that all litigation would be in this county and because it is designated by Plaintiff. 3. This Court has jurisdiction over this action pursuant to as directors of a Colorado corporation; the Individual Defendants have consented to the jurisdiction of this Court pursuant to the shareholder agreement 4. APSE, Inc. (“APSE”) is a corporation organized in 1987 under the laws of the State of Colorado with a principal place of business in Denver, Colorado. APSE was located at all times at 36 Steele Street, Suite 100, Denver, Colorado 80206. APSE was in the business of representing professional athletes as sports agents. APSE represented clients in the National Football League (“NFL”). 5. Counter Defendant, Charles Lamont Smith (“Smith”), at all times relevant hereto, was an officer, majority shareholder, president, CEO, and director of APSE and is a resident of the State of Colorado and regularly conducted business in the state of Colorado. 6. Counter Defendant, Damien Moore (“Moore”), at all times relevant hereto upon information and belief, was an employee of APSE and regularly conducted business in the state of Colorado. 7. Shareholder, and counter Plaintiff Peter J. Schaffer (“Schaffer”), at times relevant hereto, was and is a minority Shareholder of APSE. Schaffer is a resident of the State of Colorado. At other times he was also an employee, an officer and a member of the board of directors of APSE. 8. John Rickert, lives at 16 Brendan Lane, Niskayuna, New York, 12309. Rickert prior to resigning his association with APSE in July of 2011 was associated with APSE. 9. Smith and an another shareholder, incorporated APSE, a Colorado Corporation in 1987. In 1988, the original minority shareholder returned his interest to APSE and resigned from the board of directors. In 1988, Schaffer purchased a minority interest in APSE and became an employee and a 12% shareholder of APSE as well as APSE’s vice president and a minority member of APSE’s board of directors. Smith remained the majority shareholder and retained control of the Board of Directors. 10. Both Smith and Schaffer are certified agents by the National Football League Players Association which is the labor union that represents the players of the National Football League. The NFLPA also sets rules and a code of conduct for Agents (“Certified Contract Advisor”) and these Rules (“NFLPA Regulations Governing Contract Advisors”) include rules prohibiting contract advisors from initiating contact with a player who is signed to a SRA (“Standard Representation Agreement”) with another certified contract advisor. The NFLPA has the power to sanction and punish Certified Contract Advisors who violate the Regulations. In addition and

at all times relevant to this complaint, Smith is also a certified Contract Advisor with the National Basketball Association Players Association (“NBAPA”). The NBAPA regulates the conduct of certified contract advisors and precludes certified contract advisors from paying or giving anything of value to any athlete with collegiate eligibility remaining. 11. From 1989 until 2003 Smith, as the majority Shareholder, President and CEO of APSE, improperly took inequitable distributions from APSE and spent APSE funds and assets on personal and non-corporate expenses and investments without receiving either shareholder or board approval or acknowledgment and took illegal and unauthorized distributions from the company above the percentage of ownership he maintained in the company. There are no corporate minutes during this period of time authorizing such expenses, expenditures or distributions. In addition, Smith also on occasions diverted agent fee income owed to the company to his other companies during this period of time. 12. Sometime in 2002 or 2003, Smith unilaterally decided to re-organize the company with the stated goal of retiring approximately $1,600,000 in debt he owed to the company from illegal draws, investments, loans and distributions beyond his stated shares and ownership of the company all without board or shareholder approval. This restructuring was done not for the benefit of APSE or the minority shareholders but for the benefit of Smith individually. In addition, APSE required Smith to sign a loan document evidencing a loan from APSE for $160,000 and Schaffer to sign a similar loan document evidencing a loan from APSZE for $30,000. Schaffer never received any proceeds from this loan from APSE. Neither loan has been retired. APSE made a demand of Schaffer for this loan repayment but not of Smith. 13. This debt resulted from various failed business ideas and ventures of Smith such as but not limited to the "Black Movie Channel," "Elite clothing company," and a joint venture with Los Angeles lawyers to act as competing sports agents to the business of APSE (“APSE International”) financed by illegal and unapproved distributions personally taken from APSE by Smith. All of the business were categorical and substantial failures, were funded entirely by monies taken unilaterally from APSE by Smith without corporate approval, authorization or formality and did not further the business of APSE. 14. In addition, Smith’s APSE International project not only lost substantial sums of APSE money it directly competed against the main business of APSE i.e. representing professional athletes and required the majority shareholder, CEO, and President of APSE to take substantial time away from APSE to participate in the competing activities of APSE International in breach of his fiduciary duty, employment agreement and obligations and officer responsibilities to APSE. At no time during any of these transactions did either Smith or APSE offer to the minority shareholders their corresponding ownership distribution percentage of monies taken by the Smith from APSE. In addition, Smith diverted funds and fees owed to APSE to these entities, again in dereliction of his duties owed to APSE. 15. In exchange for eliminating the $1,600,000 in debt of the majority Shareholder, Smith, unilaterally increased Schaffer’s ownership interest in APSE from 12% to 30%. The was well below fair market value of the corporation for such an interest. In addition, Schaffer was required to sign a Shareholders’ Agreement with APSE and to execute an Employment Agreement. Both

agreements were in the favor of the company. The Shareholder’s agreement included provisions for the majority Shareholders buying out the stock interest of the minority Shareholders. 16. Schaffer responsibilities increased dramatically as a result of Schaffer having to pick up Smith’s duties and workload. 17. At no time during this period did Schaffer ever sign an agreement entitled “Assignment of Contract Rights.” Approximately in December of 2010, prior to the filing of this action and prior to the company breaching the employment contract, such a document was proffered by the company to Schaffer with a forged signature apparently to trick Schaffer into believing that he agreed to the document’s terms. 18. On or about the month of February 2011, Smith acting in an individual capacity and as an employee, officer and Member of the Board of APSE, approached a Schaffer client who was at the time and remains to date subject to a valid and enforceable SRA (“Standard Representation Agreement”) with Schaffer. The SRA is a NFLPA required contract allowing Schaffer to represent the player in professional football negotiations. Upon information and belief, Smith approached Schaffer’s client, his family and people close to the player with the specific intent to induce the client to either terminate his SRA with Schaffer and sign with Smith or to add Smith to the SRA in direct violation of the NFLPA’s Regulations Governing Contract Advisor. 19. At all times, Smith knew that the client was signed to a valid SRA with Schaffer. Further these actions specifically violate the NFLPA rules regarding solicitation. Smith’s actions caused significant problems for Schaffer and his relationship with the client. 20. From the years 2004 to the present, Smith, without corporate authority approval, board of directors meetings, shareholder approval or minority shareholder acknowledgment took an additional $2,900,000 from APSE in illegal distributions, loans and benefits. At no time were any other shareholders given any distributions by APSE their corresponding shares of monies taken from APSE by Smith during this time period. This money was taken to fund personal obligations, ultra vires activities, investments in non-APSE corporations and to pay for his family’s credit card bills, loans and personal debts. These investments included starting a website (“Jocklife.com”) which never derived any revenue, lost hundreds of thousands of dollars, required Smith to spend inordinate amounts of time working on to the detriment of APSE and is no longer in existence, funding condominiums in Miami Beach, Florida and Phoenix, Arizona, and the funding a personal charitable foundation (“The Smith Foundation”) to the funding of a youth aged basketball team and its travel (3-D basketball”). All of these expenditures and investments did not further the business, shareholder value or property of APSE and in fact hurt APSE as they took Smith away from his obligations to the company. All of these acts were done without corporate resolution or authority and all lost APSE significant amounts of monies. 21. Smith also without authorization paid for with APSE funds travel, meals, costs and lodging and other expenses for a youth/high school aged basketball team (3-D) to participate in basketball tournaments in locations like Chicago and Las Vegas. These trips did not further any corporate purpose and jeopardized the athlete’s collegiate eligibility involved. In addition, the vast majority of these players were of high school age and with amateur issues and college

eligibility factors involved and having sports agent pay for their flights, transportation, and room and board is in violation of a number of NCAA and NBAPA rules and regulations. The NCAA and the NBAPA prohibit sports agents from paying travel, meals, lodging and expenses for amateurs for any reason and such payments violate NCAA rules and regulations and seriously and potentially adversely affect the student athlete’s collegiate athletic eligibility and potentially opening up APSE to civil actions and administrative actions. 22. Smith and his agents have admitted to the minority shareholders on multiple occasions in writing since December 2011 that he in fact took money from the company since 2004 and has admitted that at a minimum he owes the company and the minority shareholders at least $450,000 and admits to this breach of February duty. The plaintiffs believe that the number is much greater than $450,000 and more likely in excess of $1,000,000 resulting from his breach of Fiduciary Duty. 23. From 2005 to the present, APSE and the Majority Shareholder required that the minority shareholders sign personal guarantees for Lines of credits and other loans above and beyond their ownership interest in APSE. Refusing to sign would have meant immediate termination from employment and loss of investment in the company. These guarantees and corporate waste and illegal distributions created tremendous hardship for the minority shareholders in that if the lending entities involved foreclose on these notes will require the minority shareholder to pay an inequitable portion of the corporate debt. In addition, APSE deposited a check for legal work performed by Schaffer as a lawyer into their corporate account. 24. Since approximately 1995, Schaffer, as an employee of APSE received a paycheck direct deposited into his bank account on the 15th of each month. This practice commenced prior to the signing of an employment contract. The salary received by Schaffer on the 15th of each month was consideration received by Schaffer for signing the Employment agreement and for his performance of his obligations under the Agreement. Smith received his compensation on the first and fifteenth of each month during this period of time. 25. On or about July 11, 2011, APSE, through its Comptroller, sent an e mail to all (both) officers of the company informing them, per the unilateral directives from APSE’s President (“Smith”), that APSE would not be paying the officers their salary consideration on the scheduled date of July 15, 2011. The stated reason for the failure to pay salary was the shortage of cash flow in the company. Specifically the e mail stated: “Per Mr. Lamont Smith instructions, due to the down on business line of credit and our inability to collect the receivables, officers are not going to get pay for the pay period 07/15/2011. If you have any questions, please touch base with Mr. Lamont Smith. 26. APSE did not pay Schaffer his salary for the previous month work as required by the employment contract and consistent with the E-mail of July 11, 2011 which was a material breach of the employment contract. Smith received his compensation on the 1st of July. On July 20, 2011 Schaffer sent an e mail to the company indicating that the failure to pay salary on July 15, 2011 constituted a “material breach” of his employment contract and thus the employment contract was terminated by the intentional and unilateral actions of APSE and Smith.

27. Schaffer continued in his capacity as an employee, officer and director of APSE until July 15, 2011 when the company breached his employment agreement. In this capacity, Schaffer, up to the time of the breach of contract by APSE on July 15, 2011 faithfully worked for the company in all areas of his responsibilities including the collection of fees from clients and the depositing of all of these fees into the company. On July 22, 2011, Counsel for APSE sent a letter to Schaffer detailing APSE’s position as to his employment status. The letter stated that at the Termination Date Schaffer would be entitled to all Contract Rights arising out of Contracts entered into by Schaffer following the Effective Termination Date. Counsel clearly indicated that the effective Termination Date of employment with the company shall be August 19, 2011. On August 18, 2011, Pertrice Bumpas, the assistant to the President of APSE, sent Schaffer another e mail with regards to the termination of Schaffer’s employment with APSE. The e mail contained a copy of the same July 22, 2011 letter from Counsel to Schaffer and reiterated the same information concerning the termination date and its effect on future contracts. 28. APSE unilaterally removed Schaffer in writing as an officer of the Company on July 29, 2011 and also in writing from the Board of Directors of the corporation on August 17, 2011. APSE also turned off Schaffer’s company e mail address on August 17, 2011 (“Peter@apse.net) despite Schaffer’s request to keep the e mail address active. Thereafter, Schaffer concerned about whether APSE properly complied with both Colorado Corporate Law and the Company’s Articles of Incorporation and out of an abundance of caution, resigned from all of his APSE positions in late August of 2011. 29. On September 7, 2011, pursuant to the Shareholders Agreement, Smith sent a letter to Schaffer indicating that APSE and Smith desired to purchase the ownership interest of Schaffer, starting a thirty day period during which the parties were required to determine a “Fair Market Value” (“FMV”) of Schaffer’s stock interest. However, neither APSE nor Smith made any offers or attempted to provide any FMV assessments or evaluations to Schaffer for his stock interest in the company. Instead, APSE and Smith requested that Schaffer provide an assessment and evaluation of FMV during this 30 day period. Schaffer provided a detailed FMV using 4 different methodologies of value assessment to APSE and Smith. At no time during the required 30 day period did APSE or Smith provide Schaffer with a FMV for his ownership interest in APSE as required by both Colorado law and the APSE Shareholder Agreement. 30. For the past twenty years, Smith as president, CEO, Managing director, majority shareholder and employee has fostered a hostile and abusive work environment, making continued employment impossible. Smith’s actions included random salary cuts, abusive language and threats, sexual harassment to female staff members, unprofessional conduct, and other acts which violate the realm of decency and morality. 31. On or about September 29, 2011, APSE, through its agent at the time, Richard G. Sander, threatened Schaffer with a multitude of claims and allegations for an alleged and fabricated failure to deposit client fee income into the company. In particular, APSE, though Sander, threatened claims and damages for Schaffer’s alleged failure to deposit agent fees from a client, Joe Thomas, for the 2011 NFL season into the company. These threats and assertions were made with the company having full knowledge that the fees were actually deposited by Schaffer in a timely and proper manner with APSE on or about February 3, 2011 (APSE’s accountant sent an

email to both officers, Smith and Schaffer, of this fact on the actual date of deposit) some 7 months prior in full payment for the fees. The email from APSE and Sander is attached to this complaint as an exhibit as is the e mail from the accountant referencing the deposit of these fees as well and are both incorporated in their entirety to this complaint. 32. APSE’s assertion from Sander in the e mail was that due to the lack of these depositing these fees in October of 2011, Schaffer was placing the company in financial peril. The truth is that it is the actions of Smith as the CEO, Majority Shareholder, employee and president as alleged in this counter complaint caused the company to be in financial jeopardy and peril. The assertions in the letter were false when made, Smith and APSE knew them to be false when made and were made to scare, intimidate, or otherwise force Schaffer to do actions that he was not otherwise legally obligated to perform. 33. During the summer and into the fall months of 2011, Smith and his agent, employee and associate, Damien Moore have uttered false, slanderous, defamatory, untrue and inflammatory statements about Schaffer, his reputation and his professions. For example During the Months of September and October of 2011, Smith and Moore made statements to a number of potential new clients and draft selections for the 2011 NFL Draft. These statements included “that they represented Joe Thomas, Hakeem Nicks, Russell Okung and others,” that Peter Schaffer was no longer with the company because Schaffer embezzled 1.2 million dollars from the company and that Schaffer was being disbarred as an attorney.” That the statements were additionally false as they applied to Schaffer. 34. Schaffer is informed and believes and thereon alleges that the words uttered by Smith and or Moore were heard by potential new clients of the firm who will play in the NFL and will be eligible for the 2012 NFL Draft and several other persons whose names are not presently known to Schaffer. That these comments were uttered on more occasion than averred in this complaint to additional players and people on numerous occasions all with the same purpose and intentions. 35. During the Spring of 2011, Schaffer was hired as a lawyer by the Players Trust to represent Antonio Bryant in an action against eh Cincinnati Bengals of the NFL. In February of 2011, Schaffer had informed Smith and smith acknowledged and acquiesced to the termination of their joint law practice, Smith and Schaffer. Schaffer represented Bryant to a successful conclusion and a check was sent to APSE for $20,000 for work Schaffer had done as a lawyer for Bryant. APSE deposited these funds into its operating account. APSE also deposited appropriately agent fees for Bryant received from the same case into its operating account. 36. Sometime after 2004, John Rickert approached APSE about creating an alliance involving Rickert and his company with APSE for their mutual benefit. APSE states in its complaint that a Joint Venture Independent Contract Agreement (“Joint Venture Agreement”) was entered into on or about May 30, 2004. This alleged Joint Venture Agreement allegedly provides that APSE and Rickert shall share commissions made from players that Rickert recruited during the term of the Joint Venture Agreement. Further

according to APSE the alleged the Joint Venture Agreement requires 30 days advance written notice prior to termination and contains a covenant not to compete.

37. APSE has no proof that Rickert ever received the commission payments from clients flowing from his representation of NFL players Rickert represented during the term of the alleged Joint Venture Agreement and thus whether he even owes any money to APSE. Further APSE does not acknowledge that Rickert has provide and submitted to APSE the proper amounts due APSE.

38. Rickert provided APSE with notice of termination of his association with APSE by letter dated July 23, 2011 and acknowledged as received by APSE on that date. APSE alleges that the alleged “Joint Venture agreement” states a thirty day provision and thus Accordingly, the earliest the Joint Venture Agreement could have terminated was August 22, 2011. In addition, the APSE alleges that the agreement that Rickert agreed not to engage in the business of football sports representation upon termination of the Joint Venture Agreement, and not to solicit APSE’s clients and that there is exists a non-competition clause in the Joint Venture Agreement that was necessary to protect APSE’s trade secrets and as part of a sale of assets to APSE, and is otherwise reasonable in terms of the scope of prohibited activities, its duration, and the covered geographic area. CLAIMS CLAIM FOR RELIEF TORTIOUS INTERFERENCE OF CONTRACT CLAIM 39. Schaffer and Rickert reallege the preceding paragraphs as set forth above and incorporates them herein by reference. 40. At all time herein, the defendants, APSE and Smith knew that the client of Schaffer, a football player, was signed to a valid SRA with Schaffer. The SRA Contract was in valid effect in February of 2011. 41. Smith with the intent to induce the client to either terminate the agreement with Schaffer or in the alternative to get the client to add Smith on the SRA approached people associated with the client and members of the client’s family with the intent purpose of affecting his plan and tortuously interfering with the existing contractual relationship that Schaffer had with the client. 42. Smith followed through on his intent by meeting with people who he knew or should have know were in a position to effectuate the client terminating the valid agreement Schaffer had with the client for the sole purpose of inducing the client to sign a SRA with Smith. 43. As a result of these actions of the Individual Defendants, the shareholders of APSE and Schaffer and Rickert have been and will be damaged.

CLAIM FOR RELIEF BREACH OF CONTRACT CLAIM (Breach of Contract/ Damages) 44. Schaffer and Rickert reallege realleges the preceding paragraphs as set forth above and incorporates them herein by reference. 45. As stated above, Schaffer was under an employment agreement with APSE. In exchange for working for the company, APSE would compensate Schaffer monthly with a salary. The main consideration for the agreement to Schaffer was the salary paid by APSE. 46. Due to the corporate waste and mis management by Smith and APSE and the multi million dollars of illegal distributions taken by Smith, APSE was unable to meet its corporate obligations on July 15, 2011 and failed to pay as required by the employment agreement with Schaffer his salary on the day. The vast expenditures of money caused the company to experience significant and serious cash flow issues which according to the accountant and based upon the instructions of the CEO/Majority shareholder/President to cease making salary payments to the employees of APSE. 47. APSE intentions in the e mail of July 11, 2011 was to not pay officers salary and APSE followed through on the promised actions of the email and failed to pay Schaffer his earned salary as required by the employment Agreement and thus breached the employment Agreement with Schaffer on July 15, 2011. Undoubtedly, this breach of the employment agreement is a material breach of a material provision of the agreement. Smith, who received his monthly pay on the 1st and 15th of each month, received his monthly check on the first of the month. 48. Schaffer substantially performed all of his obligations under the employment Agreement at all times and had earned the salary for July 2011. The failure of the company to pay Schaffer his July salary was an intentional and knowing act by APSE and a material breach of the employment agreement which afforded Schaffer the right to terminate the agreement and recover damages. 49. The breach of contract has damaged Schaffer to an extent to be proven at trial. Neither Smith nor APSE attempted to pay Schaffer on the 15th although Smith had received his check on the 1st of July. 50. As a result of these actions of the Smith, Schaffer has been damaged. Schaffer has suffered actual and consequential damages as a result of the breach of the agreement in an amount to be determined at trial. DERIVATIVE CAUSES OF ACTION (Breach of Fiduciary Duty) (Derivatively Against APSE and individually Against Smith)

51. Schaffer and Rickert reallege realleges the preceding paragraphs as set forth above and incorporate them herein by reference. 52. Schaffer bring this action derivatively to redress injuries suffered by the Company as a direct result of the breaches of fiduciary duties by Smith. This action is brought under § 7-107-402. 53. Schaffer owned APSE stock continuously during the time of the wrongful course of conduct by the Smith alleged herein and continue to hold APSE stock. Specifically, Schaffer has owned stock in APSE from 1988 to the present. 54. Schaffer will adequately and fairly represent the interests of APSE and its shareholders in enforcing and prosecuting its rights and have retained counsel competent and experienced in shareholder derivative litigation. 55. Smith, as Directors of APSE, are fiduciaries of the Company and its majority shareholders owes APSE the highest duties of loyalty, care, candor and good faith and fair dealing. 56. In contemplating, planning, and/or affecting the foregoing conduct, Smith and APSE were not acting in good faith toward the Company and breached their fiduciary duties. 57. Schaffer has been uniquely injured and damaged by the actions of the Corporation and Smith; 58. By not acting in good faith toward the APSE, Smith breached his fiduciary duties in the following manners but not limited to these acts and actions: a. Awarding himself an “unreasonable and improperly high salary, benefits, use of company cards allowing family members to spend corporate money, spending money on family members youth basketball teams; b. Smith made favorable loans, distributions and advances to himself and his family; c. Smith transferred corporate assets to himself at discounted prices or for no consideration; d. Smith had the company purchase services for himself; e. Smith used company assets without appropriately compensating the company; f. Smith failed to repay loans that the corporation made to him at “preferential rates;

g. Smith used company funds to pay his own personal obligations and benefits; h. Smith allowed irregularities in the keeping of the corporate books and records; i. Smith caused the company to fail to pay dividends when dividend payment would otherwise have been appropriate since he had depleted the cash flow of the company;

j. Smith oppressed the minority shareholders, such as through the use of “harsh, dishonest, or wrongful conduct, fraud, forgery and a visible departure from the standards of fair dealing. k. Smith entering into unapproved transactions with the corporation where he did or would have profited at the expense of the corporation, l. Smith took actions which caused him to compete with the corporation to the detriment of the corporation. m. Smith breached his duty to the company by promoting his personal interest and interest of competing companies at the expense of the corporate interests. n. Smith breached his duty to the company and the minority shareholders by taking in excess of but at a minimum of $2,900,000 in unauthorized and illegal distributions from the company over a period from 2005 to the present. This figure is consistent with accounting documents provided by the company to the minority shareholders on multiple occasions and is not in dispute. The depletion of the company money has placed the financial future of the company in significant peril to the detriment of the shareholders of the company; o. Smith has admitted to the minority shareholders on multiple occasions both verbal and in writing that he owes the company and the minority shareholders at least $450,000 and admits to this breach of Fiduciary duty. The Schaffer believe that the number is much greater than $450,000 but at a minimum Smith admits to the $450,000 figure. p. Smith breached his duty to the company and the minority shareholders by loaning or taking as inequitable distributions in excess of $1,000,000 in unauthorized and illegal loans and distributions from the company to APSE LLC for the purpose of funding his personal condominium in Miami Beach, Florida. ; q. Smith and the corporation mandating minority shareholders guaranteeing the debt of a majority shareholder and the corporation in excess of their ownership interests; r. the majority shareholder and Smith excluded the minority shareholders from management decisions, leaving the minority shareholders with few remedies; s. the majority shareholder signed or in the alternative is using a knowingly forged document without consent of the minority shareholder or in the alternative is attempting to utilize a document for his or the corporations purposes which he and the company knows is not a true signature of the minority shareholder for the sole purpose of the corporation. t. Smith violated 7-106-401 when Smith voted for and/or assented to a distribution made in violation of section 7-106-401 and/or the articles of incorporation and thus is personally

liable to the corporation for the amount of the distribution that exceeds what could have been distributed without violating said section or the articles of incorporation if it is established that the Smith did not perform the director's duties in compliance with section 7-108-401. u. The Company and Smith failed to give or even make a reasonable effort to give a Fair Market Value assessment to Schaffer pursuant to the Shareholder’s agreement and Colorado Corporate law for Schaffer’s interest in APSE. v. Threatening civil actions against the minority shareholder for actions that Smith and APSE knew were false when they made them for the sole purpose of intimidating, threatening, extorting and otherwise forcing Schaffer to do actions that he otherwise was not legally obligated to perform. w. Requiring APSE to expend corporate funds to pay a release and settlement to a former female employment for the resolution and release of personal affair issues after the employee left the employ of APSE. x. Exposing the Company to violations of the NCAA and NBAPA Rules and regulations pertaining to amateurism and also State laws on Agent conduct by paying for travel, lodging, uniforms, entry fees and food at company expense for amateur and high school aged basketball players to Colorado and out of state tournaments. y. Depositing fee income owed to APSE into other companies bank accounts owned by Smith; z. Depositing fees earned by Schaffer as a private attorney into APSE’s bank accounts; 59. As a result of these actions of the Individual Defendants, the shareholders of APSE and Schaffer have been and will be damaged. 60. Schaffer has no adequate remedy at law. 61. Smith had the duty to exercise good faith, care, and diligence to make the corporation produce the largest possible amounts of revenue, to protect the interests of the holders of the minority of the stock, to maintain the value of the company and its stock and to secure and pay over to the shareholders their just proportion of the income and of the proceeds of the corporation. 62. This fiduciary duty requires that Smith not misuse his power as a majority shareholder with the corporation are subjected to rigorous scrutiny and where any of their contracts or engagements with the corporation and thus has the burden not only to prove the good faith of the transaction but also to show its inherent fairness from the viewpoint of the corporation and those interested therein.

CLAIM FOR RELIEF (Declaratory Judgment) 63. Schaffer and Rickert reallege incorporates the above allegations by reference. 64. In 2003, Schaffer and APS&E entered an employment Agreement. Since the mid 1990’s, Schaffer, as an employee of APSE received a paycheck direct deposited into his bank account on the 15th of each month from APSE. This practice commenced prior to the signing of an employment contract and continued thereafter as well. 65. On or about July 11, 2011, APSE, through its Comptroller, sent an e mail to all (both) officers informing them, per unilateral instructions from APSE’s President (“Smith”), that they would not be paid on the July 15, 2011 regular pay cycle. The stated reason for the failure to pay salary was the shortage of cash flow in the company. Thereafter, on or about July 15, 2011, APSE did not pay Schaffer his salary required by his employment contract for the previous month work. The act of not paying Schaffer’s salary was an intentional act done with forethought. 66. On July 20, 2011 Schaffer sent an e mail to the company, which was received by the company, indicating that the failure to pay salary on July 15, 2011 as required by the Employment agreement constituted a “material breach” of the employment contract and thus the employment contract was terminated by the actions of APSE. Specifically the e mail stated “please be advised that based upon your unilateral decision to cease my salary payments and the failure of the company to pay my salary of July 15, 2011 as well as other issues going back many years and since December of 2010, that All Pro Sports had materially breached my employment contract and thus our business relationship with regards to All Pro Sports and Entertainment terminated effective July 15, 2011.” 67. Schaffer believes that the unilateral actions of APSE though not paying salary as required by the agreement "terminated" the agreement. APSE does not believe that the agreement was breached or that the breach was material. APSE's position is wrong and the Agreement was breached and Schaffer was well with his rights to terminate the agreement at the time of the reach as his remedy. An actual and substantial controversy exists between the parties regarding their rights under the Agreement. 68. Rickert terminated his relationship and association with APSE on July 23, 2011. There also exists an issue as to his relationship with APSE. 69. A declaration from this Court on these issue will assist to resolve that controversy. 70. Accordingly, pursuant to C.R.C.P. 57, Schaffer and Rickert are entitled to a judgment declaring that: a. APSE by not paying salary materially breached the agreement; and thus Schaffer had the right to terminate the Agreement as he did and that Schaffer owes no further obligations to APSE from the date of the breach.

b. Rickert owes no further obligations to APSE of any kind from the date of his termination letter. CLAIM FOR RELIEF Corporate Waste 71. Schaffer and Rickert reallege the preceding paragraphs as set forth above and incorporate them herein by reference. 72. Smith breached his duty to the company and the minority shareholders by loaning in excess of $1,600,000 in unauthorized and illegal loaned from the company to APSE LLC for the purpose of funding his personal condominium in Miami Beach, Florida and Phoenix Arizona from 1998 to 2003; 73. Thought the period since 2003, Smith, as a director, shareholder, employee and President of APSE has committed corporate waste of corporate assets which has historically and currently placed the financial well being of the company in peril and jeopardy. Smith’s exhorbinate, unreasonable and wasteful spending has depleted the fiancés of the company, forced the company to exhaust its lines of credit and paced the future of the company in peril. Smith in essence used the company’s resources as his own private bank and bank roll to the detriment of the company, the value of the company and the shareholders of the company. The approximate amounts of these loans, expenses and illegal distributions exceeds $2,900,000. 74. This corporate waste includes spending money on ridiculous activities completely unrelated to the business of APSE without ever receiving shareholder or board approval or ever drafting or authoring any corporate minutes or documents and it included, spending exorbinate sums of money on his sons youth basketball teams to travel and play tournaments, allow his family to spend on corporate credit cards in excess of $10,000 per month for personal expenses, investments in defunct and worthless businesses enterprises, financing personal real estate holdings and other activities which had no bearing on the corporation, were not in the corporation’s best interest, and which severally depleted the cash flow and resources of the company. All of which have placed the financial well being of the company in significant peril and the future of the company in serious jeopardy. 75. As a result of these actions of the Individual Defendants, the shareholders of APSE and Schaffer has been and will be damaged. CLAIM FOR RELIEF Accounting of the Company 76. Schaffer and Rickert reallege the preceding paragraphs as set forth above and incorporate them herein by reference.

77. Do to the admitted breaches of fiduciary duty by Smith in his individual capacity and as the Chairman of the Board and President which includes the unauthorized taking of money from the company and other accounting irregularities the minority shareholders and the clear allegations contained in this complaint of fraud, breach of fiduciary duty, corporate waste, and under Colorado Corporate Law, Schaffer demand a full and complete forensic accounting of the books and records of the company dating back to the re-organization in 2003. CLAIM FOR RELIEF Civil Fraud/ Civil Forgery 78. Schaffer realleges the preceding paragraphs as set forth above and incorporate them herein by reference. 79. Smith and All Pro allege in their action versus Schaffer that he signed an alleged document known as and entitled “Assignment of Contract Rights.” Smith and APSE attached this document to their complaint in this action and asserted that the document was a valid and true contract and that the parties to the document agreed to the and signed the document. 80. At no time during this period did Schaffer ever sign an agreement allegedly entitled Assignment of Contract Rights. Approximately in December of 2010, prior to the filing of this action and prior to the company breaching the employment contract, such a document was proffered by Smith and APSE to Schaffer with a forged signature of Schaffer with the intended desire to force Schaffer to believe the alleged document was controlling. 81. A hand writing expert consulted clearly and unequivocally states that the document was not signed by Schaffer and in all likelihood was signed and forged by someone at APSE or the majority shareholder of APSE with the clear intent of defrauding Schaffer. The document is a forgery and being used as such and to defraud another party. 82. As a result of these actions of the Individual Defendants, Schaffer has been and will be damaged. CLAIM FOR RELIEF JUDICIAL DISOLUTION OF CORPORATION Shareholder Oppression 83. Schaffer realleges the preceding paragraphs as set forth above and incorporate them herein by reference. 84. Based upon the above facts and pursuant to Colorado law, the Shareholders move this court for this court to dissolve the corporation. 85. The facts averred in this complaint show that the directors or those in control of the corporation have acted, are acting, or will act in a manner that is illegal, oppressive, or fraudulent.

86. Pursuant to CRS § 7-114-301 (2)(b) the conduct of the director constitutes oppression under the statute. The directors have acted in a Burdensome, harsh and wrongful conduct; a lack of probity and fair dealing in the affairs of the company to the prejudice of some of its members; or a departure from the standards of fair dealing, and a violation of fair play on which every shareholder who entrusts his money to a company is entitled to rely. 87. Based upon the facts averred in this complaint the actions of Smith, individually APSE, and Smith acting on behalf of APSE rise to this level of “illegal, oppressive, or fraudulent” activities and thus require a judicial determination that the Corporation as a matter of law should be dissolved. CLAIM –BREACH OF CONTRACT FAILURE OF COMPANY TO MAKE A FAIR OFFER FOR SCHAFFER’S STOCK INTEREST IN THE COMPANY 88. Schaffer realleges the preceding paragraphs as set forth above and incorporates them herein by reference. 89. On September 7, 2011, pursuant to the Shareholders Agreement Smith, as the Majority Shareholders, sent a letter to Schaffer indicating that APSE and Smith desired to purchase the ownership interest of Schaffer and started a thirty day period for which the parties were required to determine a “Fair Market Value” (“FMV”) of Schaffer’s stock interest. From the date of September 7, 2011 and continuing for thirty (30) days, neither APSE nor Smith made any offers or attempted to provide any FMV assessments or evaluations to Schaffer for his stock interest in the company. And to the contrary as to both Colorado Corporate law and the Shareholder Agreement, APSE and Smith requested that Schaffer provide an assessment and evaluation of FMV during this 30 day period. Schaffer in fact provided a detailed FMV using 4 different methodologies of value assessment; all recognized by business experts as proper FMV evaluations, to APSE and Smith. 90. At no time during the required 30 day period did APSE or Smith provide Schaffer with a FMV his ownership interest in APSE as required by both Colorado Corporate law and the APSE Shareholder Agreement. 91. APSE and Smith had a duty and obligation to provide Schaffer with a Fair Market Appraisal of his stock interest in APSE during the thirty day period after the trigger date letter. 92. While Schaffer provided this assessment to APSE and Smith, APSE and Smith never provided the same to Schaffer. By failing to provide this FMV to Schaffer, Smith and APSE breached their duty, contractual obligation and Colorado Corporate law to Schaffer. 93. As a result of these actions of the Individual Defendants, Schaffer has been and will be damaged.

CLAIM CIVIL EXTORTION/TORTIOUS INTERFERNCE 94. Schaffer and Rickert reallege the preceding paragraphs as set forth above and incorporates them herein by reference. 95. On or about September 29, 2011, APSE, through an e mail from its agent of record at the time, Richard G. Sander, threatened Schaffer with a multitude of claims and allegations for his alleged failure to deposit client fee income into the company. In particular, APSE, through Sander, threatened claims and damages for Schaffer’s failure to deposit agent fees from a client, Joe Thomas, for the 2011 NFL season into the company. These threats and assertions were made with the company having full knowledge that the allegations were false when made and that the fees were deposited by Schaffer with APSE on or about February 3, 2011 (The Company’s accountant sent an email to both officers, Smith and Schaffer, of this fact) some 7 months prior in full payment for the fees. The email from Sander is attached to this complaint as an exhibit as is the e mail from the accountant referencing the deposit of these fees as well and are incorporated in their entirety to this complaint. 96. APSE’s assertion in the e mail was that due to the lack of these fees the company was placing the company in financial peril. The truth of the matter is that it is the actions of Smith as the CEO, Majority Shareholder, employee and president as alleged in this counter complaint that caused the company to be in financial jeopardy and peril. The assertions in the letter were false when made, Smith and APSE knew them to be false when made and were made to scare, intimidate, or otherwise force Schaffer to do actions that he was not otherwise legally obligated to perform. 97. APSE and Smith through his agents, by threatening civil actions against the minority shareholder for actions that Smith and APSE knew were false when they made them for the sole purpose of intimidating, threatening, extorting and otherwise forcing Schaffer to do actions that he otherwise was not legally obligated to perform makes Smith and APSE liable for all actions and damages from said threats and statements. 98. As a result of these actions of the Individual Defendants, Schaffer has been and will be damaged. ACTION FOR SLANDER AND TORTIOUS INTERFERENCE 99. Schaffer and Rickert reallege the preceding paragraphs as set forth above and incorporates them herein by reference. 100. During the Months of September and October of 2011, Smith and Moore made statements to a number of potential new clients and draft selections for the 2011 NFL Draft. These statements included “that they represented Joe Thomas, Hakeem Nicks, Russell Okung and others,” that peter Schaffer was no longer with the company because Schaffer embezzled 1.2 million dollars from the company and that Schaffer was being disbarred as an attorney.” That the statements were additionally false as they applied to Schaffer.

101. Schaffer is informed and believes and thereon alleges that the words uttered by Smith and Moore were heard by potential new clients of the firm who will play in the NFL and will be eligible for the 2012 NFL Draft. and several other persons whose names are not presently known to Schaffer. and several other persons whose names are not presently known to Schaffer. That these comments were uttered on more occasion than averred in this complaint to additional players and people on numerous occasions all with the same purpose and intentions. 102. That these statements by Smith and Moore were understood by those who saw and heard it to mean that Schaffer had in the past and was continuing to commit crimes. 103. These words uttered by Smith and Moore, were stated by Smith and Moore not as a matter of opinion, but as a matter of fact, thus they were not protected or privileged in any way. 104. The words spoken by Smith and Moore, on March 1, 2006 carried a defamatory meaning by their very terms and were understood by those who saw and heard them in a way that defamed Schaffer. 105. Smith and Moore further made such statements deliberately and with knowledge and intention that such words would be heard by people in Schaffer’s business, industry and would affect adversely his reputation. 106. As a proximate result of Smith and Moore statements, Plaintiff has suffered loss of his reputation, economic damages, shame, mortification, and hurt feelings all to his general damages in a sum to be proven at trial. 107. As a further result of Smith and Moore statements, Schaffer has suffered special damages according to proof. 108. As the above-described words were spoken with malice and oppression and fraud such that an award of exemplary and punitive damages is necessary and appropriate. CAUSE OF ACTION FOR SLANDER PER SE 109. Schaffer and Rickert reallege the preceding paragraphs as set forth above and incorporates them herein by reference. 110. During the Months of September and October of 2011, Smith and Moore made statements to a number of potential new clients and draft selections for the 2011 NFL Draft. These statements included “that they represented Joe Thomas, Hakeem Nicks, Russell Okung and others,” that peter Schaffer was no longer with the company because Schaffer embezzled 1.2 million dollars from the company and that Schaffer was being disbarred as an attorney.” These statements were made to numerous individuals over this period of time and to persons whose names are not presently known to Schaffer. That these comments were uttered on more occasion than averred in this complaint to additional players and people on numerous occasions all with the same purpose and intentions.

111. Schaffer is informed and believes and thereon alleges that the words uttered by Smith and Moore were heard by potential new clients of the firm who will play in the NFL and will be eligible for the 2012 NFL Draft. and several other persons whose names are not presently known to Schaffer. 112. The statements made by Smith and Moore are defamatory because the language carries the meaning that Plaintiff suffered from a mental disease and thus imputes in her the present existence of an infectious, contagious, or loathsome disease. 113. The oral statements uttered by Smith and Moore were understood by those who saw and heard them to mean that Plaintiff had in the past and was continuing to commit crimes or events in opposition to the code of ethics of the Colorado bar Association. 114. Furthermore, these statements are defamatory because the language carries a meaning that Schaffer’s conduct was criminal and harmful to others. 115. That these statements by Smith and Moore were understood by those who saw and heard it to mean that Schaffer had in the past and was continuing to commit crimes. 116. These words were slanderous because they tend to injure Schaffer in his profession, trade and business by imputing to his a general disqualification in those respects that the occupation and duties peculiarly require and something that has a natural tendency to less the profits of Schaffer’s occupation. 117. These words uttered by Smith and Moore, were stated by Smith and Moore not as a matter of opinion, but as a matter of fact, thus they were not protected or privileged in any way. 118. The words uttered were also slanderous because Schaffer has never been charged with a crime at any other place or time. That the above-described oral statements by Smith and Moore, were further not privileged because Smith and Moore stated them with personal animosity, hatred and ill will toward Schaffer and with either the knowledge that they was false or without any reasonable grounds for believing that they were true. In fact, Schaffer as stated herein terminated the employment agreement on his own accord due to the breach of a material provision of the contract by APSE and was not fired or terminated by the company. In fact the company desired Schaffer to continue with his employee of the company. 119. At no relevant time did Schaffer ratify or consent to the dissemination of Smith and Moore statements on March 1, 2006. In fact, Schaffer subsequently sought an apology from Smith and Moore for their defamatory and false oral statements. 120. Schaffer is informed and believes and thereon alleges that Smith and Moore repeated these false statements about Schaffer’s “criminal conduct” to others, including other potential clients for the 2012 NFL draft and their family members, thus further damaging the reputation of Schaffer in regards to his status as a Certified Contract Advisor in the NFL.

121. The words spoken by Smith and Moore, on March 1, 2006 carried a defamatory meaning by their very terms and were understood by those who saw and heard them in a way that defamed Schaffer. 122. Smith and Moore, further made such statements deliberately and with knowledge and intention that such words would be heard by people in Schaffer’s business, industry and would affect adversely his reputation. 123. As a proximate result of Smith and Moore statements, Plaintiff has suffered loss of his reputation, economic damages, shame, mortification, and hurt feelings all to his general damages in a sum to be proven at trial. 124. As a further result of Smith and Moore statements, Schaffer has suffered special damages according to proof. 125. As the above-described words were spoken with malice and oppression and fraud such that an award of exemplary and punitive damages is necessary and appropriate. Malicious prosecution

WHEREFORE, Schaffer pray for judgment as follows: As a result of the Individual Defendants’ wrongful conduct, the Schaffer have suffered economic loss, intangible losses and losses to their interest in the company. On its first claim for relief, for a declaration that: APSE breached the Agreement and thus Schaffer has no further rights or obligations under the agreement On its claim for relief, for actual and consequential damages in an amount to be determined at trial; Any and all such further relief as the Court otherwise deems proper. for an order declaring that the Defendants breached their fiduciary duties to the Company; requiring that the Board to seek independent valuation of APSE and retain prominent financial advisors to opine on the damage to the Company; for an order awarding damages, together with pre- and post judgment interest to the Company; finding that Individual Defendants breached their fiduciary duties to the shareholders;

for Schaffer’ costs and expenses incurred in this action, including, but not limited to, experts’ and attorneys’ fees; and for a judicial determination to dissolve the corporation forthwith; for a sum sufficient to compensate Schaffer for his injuries, damages, and losses, as previously described in this Complaint; for disgorgement of legal fees owed to Schaffer and withheld or deposited by APSE For costs, expert witnesses’ fees, and other costs of suit; for interest as provided by law; for leave to amend to add a claim for punitive damages, if allowed by law and supported by the evidence as developed through discovery; for a full forensic accounting of the company; for an order that as a direct and proximate result of the Individual Defendants’ actions as alleged above, APSE’s market capitalization has been substantially damaged. further, as a direct and proximate result of the Individual Defendants’ conduct, APSE has expended and will continue to expend significant sums of money. Such expenditures include, but are not limited to: costs incurred in investigating and defending APSE and certain officers in this lawsuit, plus potentially millions of dollars in settlement or to satisfy an adverse judgment; costs incurred from compensation and benefits paid to the Individual Defendants, which compensation was based at least in part on APSE’s artificially-inflated company value and inflated revenues; and costs incurred from the loss of the Company’s clients and customers’ confidence in APSE’s services. for back pay, vacation and other benefits pursuant to company policy and the employment agreement; moreover, these actions have irreparably damaged APSE’s corporate image and goodwill. For at least the foreseeable future, APSE will suffer from what is known as the “liar’s discount,” a term applied to the stocks of companies who have been implicated in illegal behavior and have misled the public, such that APSE’s ability to raise equity capital, engage new clients, or debt on favorable terms in the future is now impaired. for such other and further relief as may be just and proper.

DATED: November 14, 2011 THE SCHAFFER REQUESTS A TRIAL BY JURY _____S/Peter Schaffer_____________ By: Peter Schaffer #17042 Duly signed copy on file at the offices of Peter Schaffer. LLC Attorneys for Schaffer 400 South Steele Street Suite 47 Denver, Colorado 80209
A TRIAL TO A JURY OF SIX (6) PERSONS IS DEMANDED.

CERTIFICATE OF SERVICE The undersigned hereby certifies that on this November 14, 2011, 2011, a true and correct copy of the foregoing ANSWER, COUNTERCLAIMS AND JURY DEMAND was served via CourtLink File and Serve on the following: Attorney for Plaintiff All Pro Sports and Entertainment, Inc. (APSE): Richard G. Sander, #12504 Email: rsander@siwlegal.com Christopher Noecker #39462 Email: cnoecker@siwlegal.com Sander Ingebretsen & Wake, P.C. 1660 17th Street, Suite 450 Denver, CO 80202
( ) by First-Class U.S. Mail ( ) by Hand Delivery ( ) by Facsimile to (303)284-0848 ( ) by Overnight Mail (xxx) by Electronic Mail (xxx ) by Electronic Filing with Lexis ____________________________ /s/ PETER J SCHAFFER 11/14/2011
This pleading was filed electronically pursuant to Rule 121 § 1-26 Original signed pleading is on file in counsel’s office.

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