Are these fair commercial terms?

[Nick M.]

Hi All,

I've received a commercial term sheet for my first commercial property ($390K loan on $520K purchase):

10 year maturity, 25 year amortization.  During the first five years fixed at 4.75 and then  after first five years interest rate will float at the Wall Street prime rate plus 1.00% with a floor of 4.75% unless a new fixed rate is established.

Few questions:
- By floating here does it mean interest rate will change monthly?

- Is 1% reasonable?
- How is a new fixed rate usually established?

Thanks!