How does Cornwell Quality Tools determine the interest rate on the Note?

e timely payment of the Note.

The Note (Note and Security Agreement, Section 1(b)) currently provides for weekly repayment of principal and interest at an annual interest of 14.24%, which is subject to changes in accordance with the Prime Rate reported in the Consumer Money Rates Chart of the online Market Data Center of the Wall Street Journal. The interest rate is fixed over the term of the Note, but is set by adding 6.74% to the current Prime Rate reported in the Consumer Money Rates Chart of the online Market Data Center of the Wall Street Journal. As of December 18, 2024, the Prime Rate was 7.50%. The interest rate on your Note may therefore be higher, lower or the same as it would be at the time of the publication of this Disclosure Document. In some states, the maximum interest rate may be less than the amount stated in the chart due to state lending statutes. All payments are intended to be applied first toward unpaid accrued interest charges and then as a reduction of the unpaid principal balance, but Cornwell reserves the right to apply these payments in any order it determines. (Note and Security Agreement, Section 1(c)). In addition, Cornwell may impose a weekly late charge of $10.00 each week that you are three or more payments in arrears. (Note and Security Agreement, Section 1(e)). The note may be voluntarily pre-paid in part or in full at any time, without penalty. (Note and Security Agreement, Section 1(c)). The term of the note will be determined by Cornwell, and will be no more than 72 months. If you finance your Reserve, as described below, that amount will be included in the Note for your initial purchase of inventory, on the same terms. The Current Weekly payment on full financing of the initial inv

Source: Item 10 — FINANCING (FDD pages 33–43)