Exhibit
10.16


 


LEASE AGREEMENT


 


THIS LEASE (this “Lease”) is made as of 3/28, 2005 by and between Genesis
Partners, LLC of Bozeman, Montana, herein referred to as “Landlord”, and Right
Now Technologies, Inc., a Montana corporation, of Bozeman, Montana, hereinafter
referred to as “Tenant”.


 


WITNESSETH:


 


1. Leased Property. Landlord hereby
leases to Tenant the office building located on the real property in Gallatin
County, Montana whose address is 110 Enterprise Blvd, Bozeman, Montana, consisting
of 12,912 square feet as depicted on the attached Exhibit A, together with
(i) the non-exclusive right of ingress and egress for Tenant and its
employees, agents, invitees and contractors between the building and the
nearest public streets, and (ii) the exclusive right to use the parking as
depicted on attached Exhibit A for its employees, agents, invitees and
contractors (the “premises”).  Landlord
represents and agrees that the parking lot will provide, at all times during
the term of this Lease, a parking ratio of not less than four spaces per 1000
square feet of rentable square footage in buildings whose tenants are or will
be using the parking lot.


 


2. Terms of Lease. The primary term of
this Lease shall be for sixty (60) months (unless sooner terminated as herein
provided) commencing on the later of the date upon which (i) a temporary
occupancy certificate is granted by the City Of Bozeman; and (ii) the
parties agree in writing that there has been substantial completion of the
additional works described in Exhibit B (“Additional Works”).   The target Lease commencement date is May 1,
2005.   It is a condition precedent to
commencement of the Lease that Landlord obtains a temporary occupancy
certificate and substantially completes the Additional Works by no later than August 1,
2005, or such later date agreed in writing by Tenant.


 


3. Option to Extend. Upon expiration
of the primary term of this Lease, Tenant is granted an option to extend the
term of this Lease for two (2) additional sixty (60) month periods, each (each
an “extension term”) upon the same terms and conditions as are included in this
Lease, subject, however, to renegotiation of the rent provided in paragraph 4
of this Lease. The primary term and the extension terms will be collectively
referred to in this Lease as the “term.” Tenant shall notify


 





















 


Landlord within not less
than one hundred twenty (120) days prior to the expiration of the primary term
of this Lease or prior to the expiration of each extension term of Tenant’s
exercise of its option to extend this Lease, provided that in the circumstances
described in paragraph 13, the options to extend the term may be exercised
earlier as provided in paragraph 13, and if the option to extend is exercised
earlier as provided in paragraph 13, nevertheless, the rental payable as
provided in paragraph 4 shall be determined at the time and in the manner
provided in paragraph 4 and this paragraph 3. During the following sixty (60)
day period, Tenant and Landlord shall negotiate and arrive at an agreement or disagreement
of the amount of rent to be paid during the applicable extension term. If
Landlord and Tenant agree upon the rent to be paid during the applicable
extension term, Landlord and Tenant shall at the end of the sixty (60) day
period enter into a new written lease or an amendment agreement setting forth
the amount of rental Tenant shall be required to pay pursuant paragraph 4 for
the applicable extension term and any other additional terms to which Landlord
and Tenant have agreed. If Tenant and Landlord fail to agree upon the rent to
be paid during the applicable extension term during the sixty (60) day period
of negotiations, a fair market appraisal comparison of comparable properties
will be completed by an independent party upon which the Landlord and Tenant
may use to negotiate the amount of rent to be paid during the applicable
extension term. If Tenant and Landlord fail to agree upon the rent to be paid
during the applicable extension term during the sixty (60) day period of
negotiations, either Landlord or Tenant may, by written notice to the other
party given within the ensuing thirty (30) day period, elect to invoke the
arbitration provisions of this Lease to determine the rent Tenant shall be
required to pay pursuant to paragraph 4 for the applicable extension term.


 


4.
Rent. Tenant shall pay as rental for the premises for the first year of
the primary term of the Lease the sum of $187,353 computed at the rate of
$14.51 per square foot on 12,912 square feet of office space, payable monthly,
in advance on the first day of each month, in installments of $15,613 per
month, plus $3134.37/mo for tenant improvements (amortized over five years at
6% interest - see Attachment “B” for detail) for the primary term of the lease
(60 months). On each anniversary date of this Lease, beginning on May 1st, 2007, the annual rent shall be increased
by 2%. Rent shall be paid without notice or demand by Landlord to Landlord at
895 Technology Blvd, Suite 101, Bozeman, Montana 59718 or at such other
place as Landlord may direct in writing.


 





















 


4A.
Additional Works. Landlord shall carry out the Additional Works (listed
in Exhibit B). In consideration for completion of the Additional Works,
Tenant shall pay to Landlord a fee comprising (i) amounts approved in
writing by Tenant, and paid by Landlord to third party contractors for
completing the Additional Works; and (ii) Landlord’s Project Management
charge, comprising 15% of the amounts approved payments referred to in
paragraph (i). Tenant shall pay such fee in equal monthly installments over the
primary (but not the renewal) term at 6% interest, on the first day of each
month. An estimate of the cost of completing the components to the Additional
Works is included in Exhibit B, and any payment made to third party
contractor that is equal to, or less than the relevant estimate shall be deemed
to be an approved payment for the purposes of paragraph (i).


 


5.
Covenants. Tenant hereby acknowledges and agrees:


 


A.
Tenant is familiar with the premises. Tenant’s taking of possession of the
premises shall be conclusive evidence that the premises were in good, clean and
sanitary condition, are in all respects satisfactory and acceptable to Tenant,
and are in the condition in which Landlord represented the premises to be.


 


B.
Tenant will keep the premises in a clean and sanitary condition during the term
of this Lease. Landlord shall have no obligation to make any alterations or
improvements of any kind in or about the premises other than as set forth in
this Lease. Tenant shall repair or replace promptly all damages to the premises
due to acts of Tenant, its agents, employees, invitees, or subtenants, reasonable
wear and tear excepted. Tenant also shall not cause any waste to be committed
in or about the premises; Tenant will keep the premises free and clear of any
and ail refuse and debris; and Tenant agrees to observe all rules and
regulations of the County of Gallatin and State of Montana in any way relating
to maintenance, use and occupancy of the premises.


 


C.
Tenant will not use or permit anything to be used upon the premises which is
likely to deface or damage the premises, or do anything that will increase the
rate of insurance thereof (unless Tenant first agrees to pay any increased
premiums), or permit anything to be done upon the premises or in the areas,
sidewalk or streets adjacent to the premises, which will amount to or create a
nuisance.


 


D.
Tenant shall make no alterations in or additions to the premises without first
obtaining Landlord’s written consent, which consent will not be unreasonably
withheld, delayed or


 





















 


conditioned. Tenant shall
not erect or permit to be erected upon the premises any signs without written
consent of Landlord, which consent will not be unreasonable withheld, delayed
or conditioned.


 


E.
Tenant agrees, with respect to all alterations or improvements to the premises
or any part thereof, which Tenant undertakes with written consent of Landlord,
that Tenant shall in all instances save Landlord and the premises forever
harmless and free from all damages, loss and liability of every kind and
character which may be claimed, asserted or charged, including liability to
adjacent owners or tenants, based upon the acts or negligence of Tenant or its
agents, contractors or employees, for any negligence, or for the failure of any
of them to observe and comply with the requirements of the law, including the
regulations and the authorities in the City of Bozeman, and Tenant will
preserve and hold Landlord and the premises free and clear from all Hens or encumbrances  for labor and materials  furnished. 
Any and  all  alterations, 
additions,  and improvements made
by Tenant to or upon the premises (with the exception of furnishings, equipment,
and removable trade fixtures installed by Tenant) shall, upon installation, be
deemed attached and part of the premises, provided however, that if prior to
termination of this Lease, or within fifteen (15) days thereafter, Landlord so
directs by written notice to Tenant, promptly following said termination of
this Lease, Tenant shall remove such of the said additions, improvements,
fixtures, and installations placed upon the demised premises by Tenant as shall
by designated in said notice from Landlord, and Tenant shall repair any damages
occasioned by such removal. Further, in this regard, Tenant hereby agrees that
it will, during the continuance of this Lease, keep the premises and interior
of the premises in good condition and repair, reasonable wear and tear
excepted.


 


F.
Tenant may use and occupy the premises for the purpose of a business office and
all activities incidental thereto, including the manufacture of software, and
not otherwise. Tenant shall not use or knowingly permit any part of the
premises to by used for any unlawful purposes and shall comply with all applicable
laws and regulations of the County of Gallatin, State of Montana, and the
United States of America.


 


G.
Tenant agrees that Landlord shall not be liable for any damage or injury to
persons or property or for the loss of property sustained by Tenant or by any
other person or persons on the premises due to any act of negligence of Tenant.


 





















 


H.
Tenant agrees that it will not assign this Lease or sublease any portion of the
premises or permit this Lease to transferred by operation of law or otherwise
without the written consent of Landlord, which consent shall not be
unreasonably withheld, delayed or conditioned; provided, however, that any
merger and reorganization of Tenant for the purpose of incorporating under
another state law shall not be deemed to be an assignment for purposes of this
paragraph and shall not require Landlord’s consent, or that any merger or
change in control of the Tenant shall not be deemed to be an assignment for the
purposes of this paragraph and shall not require Landlord’s consent. Tenant
shall remain responsible under this Lease for any portion of the premises
sublet by Tenant (even if Landlord approved the subletting), unless Landlord
shall agree otherwise. Any subtenant to whom any portion of the property is
sublet shall agree to abide by the provisions of this Lease which are
applicable to the sublet portion of the premises, before Landlord will be
required to consent to the proposed subleasing of any portion of the premises.


 


I.
Tenant will permit Landlord, at all reasonable times and after reasonable
notice to Tenant at Landlord’s sole risk and expense and in a manner that
causes the least practical disruption to Tenant, to enter upon the premises (i) to
inspect their condition and to make reasonable and necessary repairs for the
protection and preservation of the premises, (ii) to ascertain whether
Tenant has performed its covenants under this Lease, and (iii) to show the
premises to persons who may wish to rent the premises after the expiration of
the term of this Lease or to purchase the premises, provided that any showing
of the premises to persons who may wish to rent the premises shall be only
during the last year of the term of the Lease.


 


J.
Tenant, upon leaving the premises, shall at its own expense, remove all dirt, rubbish,
and refuse and upon failure to do so, Landlord may immediately, without further
notice, do so at Tenant’s expense. Tenant shall immediately pay Landlord’s
expenses upon receipt of a bill for the same from Landlord.


 


6.
Default and Landlord’s Rights. If the premises shall be deserted or
vacated, or if a trustee or receiver of a substantial portion of Tenant’s
property is appointed, or if an order is entered against Tenant for relief
under Title 11 of the United States Code, or there shall be a default in
payment of any rent for more than five (5) days after written notice of
such default from Landlord, or there shall be a default in the performance or
any other covenant, agreement, condition, rule or regulation herein
contained, or hereafter established with Tenant’s consent, which shall continue
for


 





















 


more than thirty (30) days
(or, if the default is not curable within thirty (30) days and if Tenant begins
to cure the default within such thirty (30) day period and diligently pursues
curing the same, then for such for additional period as shall be reasonably
necessary to cure the default) after Tenant’s receipt of written notice of such
default from Landlord, Tenant’s rights in this Lease (if Landlord so elects,
and such election is reserved) shall thereupon terminate and end without the
necessity for any further notice, and Landlord shall have the right to re-enter
and repossess the premises in the manner permitted by law and dispossess or
remove there from Tenant or other occupants thereof and their effects without
being liable to any prosecution or action therefore. Landlord may likewise, at
Landlord’s option, and in addition to any other remedies which Landlord may
have upon default, let and relet the premises in whole or in part, altering,
changing or subdividing the same as in its reasonable judgment may accomplish
the best rental results, and upon such terms and for such length of time,
whether lesser or greater than the unexpired portion of the term of this Lease,
as Landlord may reasonably see fit, and Tenant shall be liable to Landlord for
any deficiency between the remaining unpaid rental and the rental so procured
by Landlord for the period of said letting or reletting which is during the
remaining term of this Lease and shall further be liable for the reasonable
costs of reletting and alterations or changes required to enable Landlord to
let and relet the premises, the deficiency and costs not to exceed, however,
the balance of the unpaid rental due from tenant for the remaining term of the Lease.
Landlord any institute action for the whole of any such deficiency immediately
upon effecting a letting or reletting and shall not thereafter be precluded
from further like action in the event such letting or relettng shall not cover
the entire unexpired portion of the term hereof, or Landlord may monthly, or at
such greater intervals as it may see fit, require Tenant to pay said deficiency
then existing, and Tenant agrees to pay said deficiency to Landlord from time
to time when called upon by Landlord to do so. Should this Lease not be
terminated, Landlord may, notwithstanding such letting or reletting, at any
time thereafter elect to terminate it. Tenant, upon termination as herein
provided, will yield quiet and peaceful possession to Landlord, subject to any
letting or reletting Landlord has effected of the premises. If Landlord shall
give the notice of termination as herein provided, then, at the expiration of
such period, this Lease shall terminate as completely as if that were the date
herein fixed for the expiration of the term of this Lease, and Tenant shall
then surrender the premises to Landlord.


 





















 


7.
No Waiver of Breach. Tenant agrees that no consent, expressed or
implied, by Landlord to any breach of Tenant’s covenants or agreements shall be
deemed a waiver of any succeeding breach.


 


8.
Notice. It is agreed that all notices herein required to be given shall
be effective upon mailing, postage prepaid, addressed to Landlord at 895
Technology Blvd, Suite 101 Bozeman, Montana 59718 or addressed to Tenant
at 45 Discovery Drive, Bozeman, Montana or such other place as either may
designate in writing to the other. In addition, any notice from Landlord to Tenant
relating to this Lease or the premises shall be deemed duly served if
personally delivered to an officer of Tenant at the premises.


 


9.
Surrender Upon Termination. Tenant shall, upon termination of the term,
peacefully and quietly surrender the premises to Landlord in as good condition
as it was at the beginning, reasonable use and wear and damage by the elements
excepted. Tenant shall remove all of its personal property and trade fixtures
(repairing any damage to the premises such removal causes) so that Landlord can
repossess and enjoy the premises not later than noon on the day upon which the term
ends, whether upon notice or by holdover or otherwise. Landlord shall have the
right to enforce this covenant by ejectment, for damages, or for breach of any
other condition or covenant of this Lease.


 


10.
Peaceful Possession. Landlord covenants and agrees, at its sole expense,
that the exterior, structure, the roof and the heating, ventilating, air
conditioning, electrical, plumbing and all utility systems on or in the
premises shall be maintained in good repair and tenantable condition, excepting
damage resulting from neglect or intentional acts of Tenant, its agents,
employees, contractors and invitees. So long as Tenant pays the rent and
performs the covenants and agreements herein contained, Tenant shall peacefully
and quietly hold the premises for the primary term and any extensions thereof.


 


11.
Time of Essence. Time is of the essence of this Lease with respect to
the performance by Tenant and Landlord of their obligations hereunder.


 


12.
Attorney’s Fees. In the event any action to enforce any of the terms of
this Lease is brought, the prevailing party shall be entitled to its reasonable
attorney’s fees as provided in paragraph 25.


 





















 


13.
Liability – Premises. Landlord shall not be responsible or liable (i) for
any personal injury to Tenant or any other person on the premises, or for
injury or damage to personal property or improvements of Tenant or of any third
party on the premises unless such injury or damage is caused by the neglect or
omissions of Landlord, its agents or employees; (ii) for injury or damage
caused by the neglect or omissions of Tenant or its agents, contractors,
invitees or employees; or (ii) on account of any inconvenience or
annoyance or damage caused by fire, explosion, earthquake, flood or other
causes beyond the control of Landlord. Tenant will obtain general liability
insurance in an amount of not less than $1,000,000 on which Landlord shall be
named as an additional insured. If Tenant shall sublet any portion of the
premises, the subtenant shall also furnish the general liability insurance
required of Tenant or be covered under Tenant’s policy.


 


In
addition, Tenant will at all times hold Landlord harmless from any claim or
damages by reason of any personal injury, property damage, or otherwise,
arising from its operation or use of the premises or any of Tenant’s equipment
used in connection therewith, provided the claim or damage is not caused by
negligence or omission of Landlord, its agents, contractors or employees.


 


Landlord
shall carry, at its sole expense, all risk casualty insurance, covering the
premises, in the amount equal to the full replacement cost of the premises. The
policy shall be endorsed so that it may be terminated or amended only upon not
less than thirty (30) days prior written notice to Tenant The policy shall
contain no co-insurance clause, a deductible amount not exceeding $5,000, and
the insurance company’s consent to the waivers of subrogation set forth in the
next sentence. Landlord waives any claims it may have against Tenant and any
rights to grant subrogation rights to others for any loss, damage or claim
which is covered by Landlord’s insurance. In the event that the premises shall
be rendered wholly or partially untenantable by fire, explosion, earthquake,
Act of God, or any other cause beyond the control of Landlord (collectively,
the “casualties”), Landlord (i) shall rebuild and restore the premises as
soon as reasonably practicable to the premises’ former condition and use but
only (A) to the extent of the insurance proceeds Landlord receives, and (B) if
the casualties do not occur during the last two (2) years of the term (and
for this purpose the term shall include all extension terms Tenant notifies
Landlord it will exercise on or before thirty (30) days after the occurrence of
any of the casualties), or (ii) in circumstances not described in clause (ii) may,
at its option, either terminate this Lease by written notice given to Tenant
within sixty (60) days after the casualty or commence to repair the premises
within sixty (60) days after the casualty.


 





















 


If Landlord shall elect or
be required to repair the premises, the rental hereunder shall be abated in
proportion to the part of the premises that are untenantable, and no rental
shall be payable hereunder for the period that said premises shall be wholly
untenantable, provided that in the event any of the casualties is caused by
carelessness, negligence or improper conduct of Tenant, or of Tenant’s agents,
employees, contractors or invitees, the rental shall not be so abated.


 


All
fixtures or improvements placed on the premises by Tenant, which shall be
damaged or destroyed, shall be repaired and replaced by Tenant at its own
expense and not at the expense of Landlord.


 


If
any of the glass or plate glass in the premised shall be damaged or become
broken from the inside, Tenant shall replace, at Tenant’s own cost and expense,
all such glass or plate glass broken. If the glass is damaged or broken from
the outside, Landlord shall replace the same at its own cost and expense.


 


14.
Repairs and Maintenance. Landlord shall bear the entire expense of all
repairs, maintenance, alterations, or improvements to the basic structure
(exterior walls, roof, heating, ventilating, air conditioning, electrical,
plumbing and other systems on the premises). Landlord shall, in addition, bear
the entire expense for the repair and maintenance of the parking area, including
landscaping and keeping the parking area free of rubbish, ice and snow. Tenant
shall pay at its own expense, all repairs, maintenance, and alterations of
Tenant installed fixtures or improvements and utilities.


 


15.
Utilities, Taxes Etc. Tenant shall pay for all telephone, water/sewer,
electricity, natural gas, fire system monitoring, security systems, and
janitorial services used in the operation of the premises. Tenant agrees to pay
for replacement of light bulbs. Landlord shall pay for all real property taxes
and assessments levied and assessed against the premises and for snow removal
and lawn maintenance.


 


16.
No Smoking Policy. There will be no smoking allowed anywhere in the
premises by anyone. It will be Tenant’s responsibility to convey to and enforce
this policy by its employees, agents and all other invitees.


 


17.
Paragraph Headings. The paragraph headings in this instrument are for
convenience only and do not limit or construe the contents or any paragraphs.


 





















 


18.
Severability. It is the intent of the parties that if a part of this
Lease is invalid, all valid parts that are severable from the invalid part
shall remain in effect. If a part of this Lease is invalid in one or more of it
applications, that part remains in effect in all valid applications that are severable
from the invalid applications.


 


19.
Landlord’s Liability. The term “Landlord” as used herein shall mean only
the owner or owners at the time in question of the premises. In the event of
any transfer of such title or interest, Landlord herein named (and in case of
any subsequent transfers the then grantor) shall be relieved from and after the
date of such transfer of all liabilities as respects Landlord’s obligations
thereafter to be performed, provided that any funds in the hands of Landlord or
the then grantor at time of such transfer in which Tenant has an interest shall
be delivered to the grantee, who shall assume the obligations of Landlord or
the then grantor to Tenant with respect to those funds. The obligations contained
in this Lease to be performed by Landlord shall, subject to the foregoing
provisions of this paragraph 19, be binding on Landlord’s successors and assigns.


 


20.
Supersedes. This Lease supersedes all prior agreements between the
parties.


 


21.
Exercise of Rights. The omission of Landlord or Tenant to exercise any
right provided for on the default of the other at any time shall not preclude
Landlord or Tenant from the exercise of such right at any subsequent default of
the other or be deemed a waiver thereof or the right to do so.


 


22.
Binding Effect. This Lease shall be binding upon and inure to the
benefit of the heirs, successors, administrators, and permitted assigns of the
parties hereto.


 


23.
Security Deposit. At the execution of this Lease, Tenant will pay
Landlord the sum of $10,000 as a security deposit. Landlord shall hold and use
the security deposit as security for Tenant’s performance of its obligations
under this Lease. At the termination of this Lease and if at that time Tenant
has fully complied with all of its obligations under this Lease, Landlord shall
return the security deposit, without interest (or the part of the security
deposit which Landlord has not applied to satisfy Tenant’s obligations under
this Lease), to Tenant


 


24.
Governing Law. This Agreement and all matters relating thereto shall be
governed by the laws of Montana.


 


25.
Arbitration. Any dispute under this Lease shall be decided by binding
arbitration initiated and conducted in accordance with the commercial
arbitration rules of the American Arbitration Association (“AAA”). The
parties shall decide upon the arbitrator. If the parties are


 





















 


unable to decide upon the
arbitrator within ten (10) days after a notice from one party to the other
that a dispute exists under this Lease, the AAA shall select the arbitrator.
The decision of the arbitrator shall be binding. All costs of arbitration shall
be borne by the party the arbitrator determines to be the non-prevailing party.
Such costs shall include the costs and reasonable attorneys’ fees of the
prevailing party.


 





















 


IN
WITNESS WHEREOF, the parties have hereunto set their hands as of the date and
year first written above.


 


 


	
  GENESIS PARTNERS, LLC –
  Landlord

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	 

	
  By:

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	 

	
   

  	
   

  	
   

  	 

	
  /s/ Steve Daines

  	
   

  	
  3/24/05

  	
   

  
	
  Steve Daines, member – Landlord

  	
   

  	
  date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Clair Daines

  	
   

  	
  3/28/05

  	
   

  
	
  Clair Daines, member – Landlord

  	
   

  	
  date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  /s/ Greg Gianforte

  	
   

  	
  3/28/05

  	
   

  
	
  Greg Gianforte, member –
  Landlord

  	
   

  	
  date

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Right Now
  Technologies, Inc. – Tenant

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By

  	
  /s/ Alan Rassaby

  	
   

  	
  3/17/05

  	
   

  
	
   

  	
  Alan Rassaby

  	
   

  	
  date

  	
   

  
	
   

  	
  Company Secretary

  	
   

  	
   

  	
   

  
							



 





















 


Exhibit A


 


Exterior





 





















 


First Floor


 





 





















 


Second Floor


 





 





















 


Exhibit B


 


Additional Works and Estimated Costs


 


	
  1.

  	
  Electrical
  upgrades

  	
   

  	
  $

  	
  49,450

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.

  	
  Auto transfer
  switch

  	
   

  	
  $

  	
  13,340

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.

  	
  Fire sprinkler
  up-grade for server room

  	
   

  	
  $

  	
  11,500

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.

  	
  A/C upgrades for
  server room

  	
   

  	
  $

  	
  87.837

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
  Total estimated

  	
   

  	
  $

  	
  162,127

  	
   

  



 


Five
Year Amortization at 6% annual rate = estimated $3134.37/mo