Perhaps you are thinking about rate sheets for different types of consumer loans?
While terminology varies by institution, the usage here implies that a commercial loan was applied for and submitted to underwriting. The underwriters then submit back to the loan officer/originator the terms under which the loan can be approved. In these terms they will require verifications for truthfulness all of the major relevant information to estimate the risk of underwriting the loan. Once those terms are met to the underwriters satisfaction, the loan becomes approved.
While I don't have experience in commercial loans, I would expect that amongst what they might require would be verification of crude sold, price and volume. Verifications from an independent oil and gas geologists as to likely reserves, and what portion is likely to be recovered by Petron's system of CO2/EOR, as well as financials and other relevant information.
Not every loan that comes into this process is approved in the end, but I would be quite optimistic about the possibility here. Most likely they have applied with a commercial lender with significant experience with this type of business loan (oil & gas). Without any doubt, the bank will do very thorough and very real "DD" before issuing an approval, and will have access to more information than what any penny sleuth can uncover!
But if it is approved, and an 8k is filed, then THAT will vindicate Mr Smith's business plan, and shareholders can rest easy knowing that a BANK is banking on PEII success! Still a big if there. But if declined it doesn't make PEII a bad investment for shareholders, it just would mean the bank wasn't willing to take on the risk as presented to them.
GLTY.
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