The Wildcat Oil Company is trying to decide whether to lease or buy a new computer-assisted drilling system for its oil exploration business. Management has decided that it must use the system to stay competitive; it will provide $1.6 million in annual pretax cost savings. The system costs $7.5 million and will be depreciated straight-line to zero over five years. Wildcat's tax rate is 31 percent, and the firm can borrow at 6 percent. Lambert Leasing Company has offered to lease the drilling equipment to Wildcat for payments of $1,710,000 million per year. Lambert's policy is to require its lessees to make payments at the start of the year.

Many lessors require a security deposit in the form of a cash payment or other pledged collateral. Suppose Lambert requires Wildcat to pay a $130,000 security deposit at the inception of the lease. What is the NAL with the security deposit?