The version of SQL Server in use does not support datatype datetime2?

In addition to @Mithrandir answer validate that your database is running in compatibility level set to 100 (SQL 2008).

You don't have to use DATETIME2 in your database to get this error. This error happens usually once you add required (NOT NULL) DATETIME column to existing table and you don't set the value prior to saving the entity to database. In such case .NET will send default value which is 1.1.0001 and this value doesn't fit into DATETIME range. This (or something similar) will be source of your problem.

Have you tried to open your EDMX file with XML Editor and check the value of ProviderManifestToken. It may help to change from ProviderManifestToken=”2008” to ProviderManifestToken=”2005”.