Land of Lincoln Goodwill Industries, Inc. v. PNC Financial Services Group, Inc. , 762 F.3d 673 ( 2014 )

In the
United States Court of Appeals
For the Seventh Circuit
No. 13-2860
LAND OF LINCOLN GOODWILL
INDUSTRIES, INC., an Illinois
Not for Profit Corporation,
Plaintiff-Appellant,
v.
THE PNC FINANCIAL SERVICES GROUP,
INC., a/k/a PNC Bank, NA,
a national bank,
Defendant-Appellee.
Appeal from the United States District Court
for the Central District of Illinois.
No. 3:12-cv-03259-BGC — Byron G. Cudmore, Magistrate Judge.
ARGUED DECEMBER 13, 2013 — DECIDED AUGUST 12, 2014
Before EASTERBROOK, KANNE, and ROVNER, Circuit Judges.
ROVNER, Circuit Judge. When Land of Lincoln Goodwill
Industries, Inc. (“Goodwill”) informed its lender, PNC Finan-
cial Services Group, Inc. (“PNC”), that it intended to pay off
the balance of its twenty-year loan early, PNC notified Good-
2 No. 13-2860
will that it would owe a prepayment charge in excess of
$300,000. Goodwill filed suit seeking a declaratory judgment
that it owes no such fee under the terms of its agreement with
PNC. The district court concluded otherwise. It reasoned that
because the contract terms impose a charge when prepayment
is made “during a period when the unpaid principal balance
bears interest, or is scheduled to bear interest, at a fixed rate,”
and Goodwill gave notice of its intent to prepay the balance of
the loan during a ten-year period when interest on the loan
was accruing at a rate of 4.79 percent per annum, Goodwill
owes PNC a prepayment fee. R. 17; see Land of Lincoln Goodwill
Indus., Inc. v. PNC Fin. Servs. Grp., 2013 WL 2446375 (C.D. Ill.
June 5, 2013). Goodwill appeals, contending that because the
loan agreement called for a one-time adjustment of the interest
rate ten years into the twenty-year loan period, at no time
during the loan will interest accrue at a fixed rate, and conse-
quently at no time will its prepayment trigger a charge.
Because Goodwill’s reading is contrary to the plain terms of
the contract and would render one of its terms a nullity, we
reject that reading and affirm the district court’s judgment.
I.
The loan transaction underlying the agreement in this case
took place in October 2007 among Goodwill, Sangamon
County, Illinois (the “County”), and PNC’s predecessor,
National City Bank (“National City”). The County agreed to
issue $2 million in economic development revenue bonds and
loan the proceeds to Goodwill for purposes of a development
project. That project involved the acquisition and renovation of
a building in Springfield to establish a retail thrift store along
with training and counseling facilities for Goodwill’s clients
No. 13-2860 3
and administrative facilities for its staff. The loan was for a
period of twenty years. National City purchased the bonds and
by so doing funded the loan to Goodwill. The transaction was
evidenced by a loan agreement and promissory note, and the
loan was secured by a mortgage on the project. The County’s
rights under the loan agreement were assigned to National
City, which the loan agreement referred to as both the “As-
signee” and the “Purchaser.” PNC acquired National City on
December 31, 2008, and succeeded to National City’s rights
under the agreement. For the sake of simplicity, we shall omit
further mention of National City and substitute PNC in its
place.
Although dated September 1, 2007, the loan agreement was
signed on October 5, 2007, and the term of the loan commenced
as of the latter date. The agreement and the note obligate
Goodwill to make monthly payments of principal together
with interest at one of two specified rates. The agreement
specifies an “Initial Rate” of interest for the first ten years of the
loan and an “Adjusted Rate” for the second ten years. The
Initial Rate is deemed to be 4.79 percent per annum. That rate
will apply until the Interest Rate Adjustment Date, which is
identified as October 5, 2017 (ten years into the loan). The
Adjusted Rate is defined as “the rate calculated on the Interest
Rate Adjustment Date by Purchaser equal to the Purchaser’s
Cost of Funds on the Interest Rate Adjustment Date plus
.80%.” R. 1-1 at 15.
The parties entered into the loan agreement on the assump-
tion that the Bonds constituted tax-exempt private activity
bonds issued for a qualified purpose to be undertaken by a
not-for-profit, section 501(c)(3) entity (Goodwill) and that, as a
4 No. 13-2860
result, the interest paid to the bondholder (PNC) would not be
includable in its gross income. Anticipating the possibility that
this assumption could turn out to be mistaken, and that
interest on the bonds might later be deemed to be taxable, the
loan agreement specifies that if and when a determination of
taxability comes to pass, interest on the loan will thereafter
accrue at a Taxable Interest Rate. The agreement defines the
Taxable Interest Rate as ”a rate of interest per annum equal to
the Base Rate from time to time in effect.” R. 1-1 at 21. The Base
Rate is in turn defined as “the floating, daily, variable rate per
annum of interest determined and announced by the Assignee
from time to time as its ‘Base Lending Rate’ … .” R. 1-1 at 15.
The Taxable Interest Rate is thus a variable rate. No determina-
tion of taxability has come to pass, but the agreement’s
provision for that possibility, including a variable Taxable
Interest Rate that would apply in that event, sheds some light
on the proper understanding of the terms governing a prepay-
ment charge.
Article IV of the loan agreement specifies that the bond
proceeds will be paid into a project fund to finance Goodwill’s
acquisition and renovation of the project property. Any unused
funds are to be transferred from the project fund to a bond
fund from which principal and interest payments to PNC are
made and applied as set out in section 9.3 of the agreement and
section 5 of the County resolution that authorized issuance of
the bonds. We note these provisions of Article IV not because
they are at issue in this case, but because they provide context
for section 9.3 of Article IX, to which we turn next.
Article IX of the loan agreement confirms that Goodwill has
the right to prepay, in whole or in part, the principal balance
No. 13-2860 5
owed on the note and identifies the circumstances under which
Goodwill, if it exercises that option, will owe PNC a prepay-
ment charge. The purpose of such a charge is to protect the
lender against the loss of bargain it will incur if its borrower
chooses to prepay the outstanding balance of the loan at a time
when market rates have fallen below the interest rate specified
by the loan. See River East Plaza, L.L.C. v. Variable Annuity Life
Ins. Co., 498 F.3d 718, 721 (7th Cir. 2007); In re LHD Realty Corp.,
726 F.2d 327, 330 (7th Cir. 1984). We reproduce the first four
sections of Article IX here, omitting certain provisions (such as
how prepayment may be made and how it is to be credited)
that are not relevant to the arguments made in this case.
ARTICLE IX
PREPAYMENT OF THE NOTE
Section 9.1 General Optional Prepayment
The principal installments of the Note are subject to
prepayment (concurrently with prepayment of the
Bonds) at the option of [Goodwill] at any time, in
whole or part, subject to the following prepayment
charge (the “Prepayment Charge”):
(a) [Goodwill] shall have the right to prepay the
principal installments of the Note in whole or
part, provided, that … (iii) concurrently with the
prepayment of the entire unpaid principal
balance of the Note, [Goodwill] shall prepay the
accrued interest on the principal being prepaid.
(b) If the Note is:
6 No. 13-2860
(i) prepaid, in whole or in part, during a
period when the unpaid principal bal-
ance bears interest, or is scheduled to
bear interest, at a fixed rate, or
(ii) accelerated after the occurrence of an an
Event of Default hereunder, during a
period when the unpaid principal bal-
ance bears interest, or is scheduled to
bear interest, at a fixed rate,
and if, on the date of the occurrence of either (i) or
(ii) above, … on the date of any subsequent prepay-
ment for which a Funding Cost Recovery Charge is
determined (each a “Determination Date”), the
Reinvestment Rate is less than the Funding Cost,
then a “Funding Cost Recovery Charge”, computed
in accordance with the terms of the Funding Cost
Recovery Charge Addendum, shall be payable by
[Goodwill] to [PNC] at the time of prepayment or
acceleration as applicable. …
The terms “Reinvestment Rate” and “Funding
Cost” are defined in the Funding Cost Recovery
Charge Addendum. [Goodwill’s] execution of this
Loan Agreement and the Note shall constitute
acknowledgment that [Goodwill] has received a
complete copy of the Funding Cost Recovery
Charge Addendum. [PNC’s] determination of the
Funding Cost Recovery Charge shall be conclusive
absent manifest error.
No. 13-2860 7
Section 9.2. Optional Prepayment if Tax Exemption
is Lost.
If there shall have been made a Determination
of Taxability, [Goodwill] shall have the option to
prepay the Note in whole. The amount to be prepaid
pursuant to this Section shall be equal to the princi-
pal amount of all Outstanding Bonds, plus accrued
interest at the Taxable Interest Rate to their redemp-
tion date to the extent the interest is taxable income
to the Registered Owners of the Bonds, plus any
applicable Prepayment Charge. … In the event
[Goodwill] does not exercise the instant option to
redeem, then (i) the interest payable on all Notes
then outstanding shall be adjusted to the Taxable
Interest Rate, and (ii) [PNC] may demand prepay-
ment by [Goodwill] of the Note.
Section 9.3. Mandatory Prepayment upon Transfer
from Project Fund.
If any amounts are transferred from the Project
Fund to the Bond Fund pursuant to Section 4.5 of
this Loan Agreement, [Goodwill] shall prepay the
Note in an amount equal to the principal amount of
the Bonds required to be redeemed on such an
occurrence pursuant to Section 5 of the Bond Resolu-
tion, plus any applicable Prepayment Charge. Said
amount shall be paid by [Goodwill] to [PNC] not
later than the date the Bonds are to be redeemed
pursuant to such provision.
8 No. 13-2860
[Goodwill] will promptly notify the Issuer and
[PNC] in writing of the occurrence and existence of
an event which will result in mandatory prepayment
under this Section 9.3.
Section 9.4. Notice of Prepayment.
To exercise an option granted by Section 9.1 or
9.2, [Goodwill] shall give written Notice to the
[County and PNC], … which shall specify therein
the date upon which a prepayment of the Note (or a
portion thereof) will be made … .
R. 1-1 at 47–48 (emphasis in original).
The subjects of prepayment and a charge for such prepay-
ment were also briefly addressed in the note.
The principal installments of this Promissory
Note are subject to prepayment (concurrently with
prepayment of the Bonds) at the option of [Good-
will] at any time, in whole or in part, with a prepay-
ment charge as set forth in the Loan Agreement.
R. 1-1 at 62.
The Funding Cost Recovery Addendum (the “addendum”)
referred to in section 9.1 of the loan agreement sets forth the
formula for calculating the prepayment charge. That formula
calls for a calculation of an interest rate differential “[f]or each
period that bears interest, or is scheduled to bear interest, at a
known fixed rate,” and then employs that differential to arrive
at the funding cost recovery charge. R. 14-1 at 1. There is no
dispute that the “prepayment charge” referenced in the note is
synonymous with the “funding cost recovery charge” refer-
No. 13-2860 9
enced in both the loan agreement and the addendum. Like the
loan agreement and the note, the addendum was dated
October 5, 2007, and was signed by Goodwill’s Chief Executive
Officer; the addendum expressly reflects the parties’ intent that
it be made part of the note. See Davis v. GN Mortg. Corp., 396
F.3d 869, 879 (7th Cir. 2005).
An Internal Revenue Service (“IRS”) Form 8038, entitled
“Information Return for Tax-Exempt Private Activity Bond
Issues,” was completed by the County as part of the loan
transaction. As its title suggests, this form is prepared by the
issuer of tax-exempt private activity bonds like the ones issued
in this case; the County therefore completed the form. Line 21
of the form as completed describes the yield on the bonds as a
“Variable Rate.” R. 1-2 at 54. The completed form was filed
with the IRS.
On March 30, 2012, less than four and one-half years into
the loan, Goodwill notified PNC that it would prepay the loan
in full on May 17, 2012. PNC responded on April 3, 2012, by
sending Goodwill a calculation of the loan payoff amount as of
April 4, 2012, which included a prepayment charge of
$404,619.01 pursuant to section 9.1(b) of the agreement. PNC
subsequently prepared and sent to Goodwill two additional
calculations assuming payoff dates of May 9, 2012, and June 27,
2012, which included prepayment charges of $300,200.82 and
$303,131.24, respectively.
On August 23, 2012, Goodwill filed suit in Illinois state
court for a declaratory judgment; PNC removed the litigation
to federal court based on diversity of citizenship between the
parties. Goodwill contends that because the loan was properly
10 No. 13-2860
characterized as an adjustable-rate loan rather than a fixed-rate
loan, there is no time during the loan period during which
interest can be said to accrue at a fixed rate. Consequently, in
Goodwill’s view, section 9.1 of the loan agreement does not
apply and no prepayment charge is owed.
The magistrate judge, to whom the parties had submitted
the case for final disposition, disagreed. R. 17. In his view,
sections 9.1 and 9.2 of the agreement should be understood as
providing for two different scenarios that might occur with
respect to the interest rate that Goodwill must pay over the life
of the loan. In the first scenario, the bonds are deemed to be
tax-exempt as the parties assumed, and thus Goodwill will pay
interest on the loan funded by the bond proceeds at the Initial
Rate of 4.79 percent annually for the first ten years of the loan,
and interest at the Adjusted Rate for the second ten years.
Section 9.1 is meant to govern any prepayment of principal
that Goodwill would make in that scenario. In the second
scenario, interest on the bonds is deemed taxable, contrary to
the parties’ anticipation, and consequently Goodwill becomes
obliged to pay interest at the Taxable Rate, which varies on a
daily basis. Section 9.2 of the agreement governs that scenario;
and if Goodwill should decide to prepay any portion of the
principal following a determination of taxability, under section
9.2, it would owe no prepayment charge. As noted, there has
been no determination of taxability, and so when Goodwill
gave notice of its intent to prepay the outstanding principal in
full, interest was accruing at the fixed, Initial Rate of 4.79
percent per annum. In the magistrate judge’s view, then,
section 9.1(b) imposed a prepayment charge. R. 17 at 14–17.
No. 13-2860 11
The magistrate judge rejected Goodwill’s contention that
section 9.1 should be understood as surplusage, a contention
premised on the notion that, in the absence of one specified
interest rate for the full twenty-year term of the loan, interest
can never be said to accrue at a fixed rate. This was not a
circumstance, the magistrate judge pointed out, in which a loan
officer was simply filling in blanks on a preprinted form;
“[r]ather, these documents were prepared for this specific
transaction by the County’s bond counsel in cooperation with
National City.” R. 17 at 17–18. Consequently, the normal rules
of contract interpretation apply, including in particular the
goal of giving meaning to all provisions of the contract and
avoiding an interpretation that renders any provision or term
surplusage. Simply because the interest rate on the bonds
could be described as “variable,” as it is on the Form 8038, does
not mean that there is no period during which interest on the
loan (and thus the bonds) is accruing at a fixed rate of interest.
The “fixed rate” language in section 9.1(b) refers not to the
overall yield on the bond issue or the overall term of the loan
but rather to a period of time during the loan term when
prepayment will trigger a corresponding charge. At the point
in time when Goodwill gave notice of its intent to make
prepayment, interest was accruing at a fixed annual rate of
interest. Goodwill’s decision to prepay the principal thus
triggered a prepayment charge. R. 17 at 17–21.
As there are no claims as to the enforceability of section 9.1
nor any dispute as to the accuracy of PNC’s calculations of the
charge owed, the magistrate judge granted PNC’s motion for
judgment on the pleadings, denied Goodwill’s cross-motion,
and entered judgment for PNC. R. 17 at 21–22. He also denied
12 No. 13-2860
Goodwill’s subsequent motion to alter or amend the judgment,
which essentially was a request that the court reconsider its
decision. R. 22.
II.
Our review of the district court’s Rule 12(c) decision is, of
course, de novo. E.g., Ball v. City of Indianapolis, No. 13-1901,
— F.3d —, 2014 WL 3673466, at *5 (7th Cir. Jul. 25, 2014). As the
parties agree, the correct understanding of a contract presents
a question of law for the court. E.g., Hanover Ins. Co. v. Northern
Bldg. Co., 751 F.3d 788, 791 (7th Cir. 2014). The parties specified
that the loan agreement is to be governed by Illinois law (R. 1-1
at 52) and, accordingly, we apply that state’s rules of contrac-
tual interpretation. Id. at 792. Our prime objective is to effectu-
ate the intent of the parties. Id. (citing C.A.M. Affiliates, Inc. v.
First Am. Title Ins. Co., 715 N.E.2d 778, 782 (Ill. App. Ct. 1999).
We do that by enforcing the contract as the parties have
written it, as the plain language of the contract is the best
evidence of the parties’ intent. E.g., Marlowe v. Bottarelli, 938
F.2d 807, 812 (7th Cir. 1991); Smith v. West Suburban Med. Ctr.,
922 N.E.2d 549, 552–53 (Ill. App. Ct. 2010); see also Hanover Ins.
Co., 751 F.3d at 792. We look to the contract as a whole in
interpreting its individual terms, adopting an understanding
of the language that is natural and reasonable. Id. at 553. And,
as the district court noted, whenever possible we attempt to
give meaning to every provision of the contract and avoid a
construction that would render a provision superfluous. E.g.,
Kim v. Carter’s, Inc., 598 F.3d 362, 364 (7th Cir. 2010) (citing Hot
Light Brands, L.L.C. v. Harris Realty Inc., 912 N.E.2d 258, 263 (Ill.
No. 13-2860 13
App. Ct. 2009)); Matthews v. Chicago Transit Auth., 9 N.E.3d
1163, 1188 (Ill. App. Ct. 2014).
Section 9.1 of the loan agreement is the controlling provi-
sion with respect to this dispute. Neither section 9.2 nor section
9.3 would apply to the facts presented: there has been no
determination that the bonds are taxable, the scenario ad-
dressed by section 9.2, nor has there been any transfer of funds
from the project fund to the bond fund, as referenced in section
9.3. What has occurred is Goodwill’s notification that it intends
to prepay the outstanding balance of the loan. Pursuant to
section 9.1, that notice triggers a prepayment charge if it was
given during a “period” when interest on the loan can be said
to accrue at a “fixed” rate. PNC’s view is that because Good-
will gave notice during the first ten years of the loan, a period
of time for which the loan agreement specifies an annual
interest rate of 4.79 percent that remains unchanging for the
entire ten-year period, notice was given during a period during
which interest was accruing at a fixed rate. Goodwill, on the
other hand, contends that because the loan agreement specifies
one interest rate for the first half of the loan term (the Initial
Rate of 4.79 percent), and another interest rate for the second
half of the loan term (the Adjusted Rate), the loan is necessarily
an adjustable-rate loan and neither of the rates it specifies for
the two halves of the twenty-year loan term can properly be
described as a fixed rate.
PNC’s view reflects the better understanding of the contract
terms. It is consistent with an ordinary understanding of the
terms “period” and “fixed” found in section 9.1. And unlike
Goodwill’s construction, it avoids rendering section 9.1
superfluous, while giving that provision at least some work to
14 No. 13-2860
do, in conjunction with section 9.2., in distinguishing between
situations in which a prepayment fee will be owed and at least
one situation in which it will not be owed.
The terms of section 9.1 render Goodwill liable for a
prepayment charge if Goodwill gives notice of its intent to
prepay the loan, in whole or in part, “during a period when the
unpaid principal balance bears interest, or is scheduled to bear
interest, at a fixed rate[.]” R. 1-1 at 47. As of March 30, 2012,
when Goodwill gave notice of its intent to prepay the loan in
full (on May 17, 2012), interest on the outstanding principal
balance of the loan was accruing at an annual rate of 4.79
percent. The loan agreement specified that Initial Rate of
interest for the first ten years of the twenty-year loan. That ten-
year interval certainly qualifies as a “period,” and as a single
rate of interest applies to that entire ten years, the rate can
readily be understood as “fixed” for that period.
Goodwill’s contrary understanding focuses on the fact that
the Initial Rate does not govern for the entire life of the loan;
instead, the loan agreement specifies a second rate—the
Adjusted Rate—for the second half of the loan term. Vis-à-vis
the twenty-year term of the loan, then, there is no “fixed” rate,
but rather a variable rate that adjusts once, ten years into the
loan term. Section 9.1, however, does not ask whether there is
a single rate for the whole of the loan term nor does it ask
whether the loan itself may be described as a fixed-rate loan or
an adjustable-rate loan. It turns instead on whether notice is
given during a “period” (i.e., an interval of time) when interest
accrues at a fixed rate. The term ”a period”can readily be
understood to include each of the two ten-year halves of the
loan term. It is by no means uncommon for loan agreements to
No. 13-2860 15
specify different rates of interest for different segments of the
loan term; indeed, agreements which specify an initial fixed
rate, which after some interval reverts to a variable rate, are
quite familiar. See, e.g., United States v. Phillips, 731 F.3d 649, 651
(7th Cir. 2013) (en banc) (describing typical terms of stated-
interest loans offered by subprime mortgage lender prior to
2008 financial collapse). Common parlance would deem the
rate “fixed” during the initial interval, even if the loan itself
would be described as an “adjustable-rate” or “hybrid” loan.
Of course, any adjustable-rate loan can be broken down
into periods of some length, and we can imagine Goodwill
arguing that on PNC’s view, even if the loan agreement called
for daily re-calculation of the interest rate, notice given on any
particular day could be described as being given during a
twenty-four hour “period” when interest was accruing at a
fixed rate. But this does not answer why, in the context of an
agreement that calls for a one-time adjustment of the interest
rate over the course of a substantial loan term, thereby creating
two distinct intervals in the life of the loan, each interval may
not be described as a period during which interest accrues at a
single, fixed rate.
This is also where the interpretive goal of giving meaning
to each provision of the contract comes to the fore. On Good-
will’s understanding of the contract, section 9.1 has no role to
play whatsoever: as there is no single rate that governs for the
entire term of the loan, there will be no “period” during which
interest accrues at a fixed rate. This understanding renders
superfluous not only section 9.1, but also the addendum that
Goodwill’s CEO signed, which in turn sets forth the means of
calculating the prepayment charge. Goodwill’s counsel has
16 No. 13-2860
indicated that although the terms of the loan were negotiated,
the parties used a form contract; and we recognize that form
provisions occasionally can be rendered superfluous by the
parties’ negotiations and revisions. This possibility leaves
unexplained why Goodwill would also be signing an adden-
dum that could have no application on its understanding of the
contract terms.
PNC’s construction of the agreement, by contrast, gives at
least some meaningful task for section 9.1 to perform. At first
blush, it might seem that if each of the two ten-year segments
of the loan qualifies as a “period” during which interest is
accruing at a fixed rate—the Initial Rate during years 1 through
10, and the Adjusted Rate in years 11 through 20—then there
is no instance in which Goodwill would not owe a prepayment
charge. That possibility leads one to wonder why the contract
does not simply declare that if Goodwill elects to prepay the
balance of the loan in whole or in part, it will owe a prepay-
ment charge, period. But as PNC has pointed out, there is at
least one scenario in which interest on the principal would
accrue at a variable rate—if interest on the bonds were deemed
taxable. Section 9.2 of Article IX provides that in the event of a
determination of taxability, interest on the outstanding balance
of the loan would thereafter accrue at the Taxable Interest
Rate.1 As we mentioned earlier, the Taxable Interest Rate is
1
In the event of a determination of taxability, section 9.2 also grants to
Goodwill the option to make prepayment of the note in full. (PNC is
likewise given the option of demanding prepayment.) However, our
discussion assumes that Goodwill would not choose to prepay the loan in
full immediately upon such a determination (or that PNC would demand
(continued...)
No. 13-2860 17
defined as being equal to the Base Rate, which in turn is PNC’s
Base Lending Rate, a “floating, daily, variable rate per annum
of interest.” R. 1-1 at 15, 21. In that scenario, then, interest
would no longer be accruing at a fixed rate of interest but a
variable rate of interest. Consequently, if, at a later date,
Goodwill chose to exercise its right under section 9.1 to prepay
the loan in full or in part, it would owe no prepayment charge,
as interest would then be accruing at a variable rate of interest.2
On this understanding, section 9.1 and its reference to a period
in which interest is accruing at a fixed rate plays at least a
limited role, when read together with section 9.2, in distin-
guishing between situations in which Goodwill would or
would not owe a prepayment charge.
For these reasons, we sustain the district court’s interpreta-
tion of section 9.1. Because Goodwill gave notice of its intent to
make prepayment during the ten-year period of the loan
during which interest on the outstanding principal was
accruing at the Initial Rate of 4.79 percent per year, Goodwill
owes a prepayment charge.
1
(...continued)
it), and that interest would thereafter accrue at the variable Taxable Interest
Rate.
2
Section 9.2 does obligate Goodwill to remit “any applicable prepayment
charge,” but as the district court pointed out, this must refer to a charge
resulting from a prior, partial prepayment, because Goodwill would not
otherwise owe a prepayment charge for a prepayment made during a
period when interest is accruing at the Taxable Rate of Interest, which is a
variable rate. R. 17 at 15–16.
18 No. 13-2860
III.
The district court correctly concluded that section 9.1 of the
Loan Agreement imposes a prepayment charge on Goodwill
and properly granted judgment on the pleadings to PNC on
that basis. We AFFIRM the judgment.