Welcome to the Danarg Team
Our Project Funding Guideline was designed to give you a thorough understanding of the processes we use and a start to finish walk through of our funding process.
The focus, right from the beginning, is on a team approach ending in a win-win success story for you and for us. By “doing it right the first time”, we end up with a carefully vetted project. We want your project to be funded and successful in the end. For many of our clients, the extra work we do together in our first project lays the groundwork to make subsequent projects much easier and faster to launch in the months and years ahead.
Our experienced team and network are experts in their field and are committed to honesty, transparency and excellence in working with you as our partner. We look forward to working with you.

Introduction
Danarg GmbH specializes in funding projects that the “A” banks and traditional institutional funding sources would typically turn down. Danarg represents a highly experienced and qualified private lenders consortium that uses a powerful syndicated investment trust fund and bank instruments to fund significant and important projects from $10 million to $1 billion and beyond. Danarg is supported by several hedge funds, private money trust funds and institutional investors. Our financing programs are project-driven and are not based on the borrower’s individual credit rating. Our lender is also able to provide financing for bank instrument when needed.
Danarg’s private lenders consortium will provide funds for construction projects, infrastructure, asset acquisition and development projects anywhere in the world except where bullets fly. Our Lender is willing to consider the inclusion of a wide variety of other expenditures as long as they are directly related to the successful completion of the project. However, standard working capital expenditures are the borrower’s expense and cannot be included as a part of any request for capital. Our lenders consortium will work with existing corporations that have a long successful track record.
Funding Options
Our lenders offer two options for financing projects using also cash backed bank instruments:
- If the borrower has at least 20% cash of the project-volume or 30% of the funding amount in first-class bank-collateral as security then our funder will provide the necessary 80 % to 100 % capital as straight debt.
- Bank Guaranties and Standby Letter of Credits from first class banks with at least 30 % of loan volume might be accepted as collateral for project financing volume. An RWA confirmation from the clients’/borrower’s bank has to be submitted to Danarg GmbH first for due diligence and compliance inspection.
Funding Logic
It is quite reasonable to assume that almost everyone has had some experience with a conventional financial institution asking to borrow money. Whether it is a new house or a new car, the bank is not going to agree to anything unless you are able to meet their lending criteria. Danarg’s process is exactly the same with one very important difference: When a borrower goes to a conventional bank, the borrower has to abide by the bank’s protocols that were written to favor the bank’s interests, not the borrower. That’s how they make their money. Danarg and its lenders consortium are a private lender that is not bound to the same one-sided protocols which is why they are able to approve loans that a typical “A” bank would turn down.
Our lender is governed by the European Law and U.S. SEC (Securities and Exchange Commission) and must abide by their strict compliance policies to protect both the Lender as well as the Borrower. To some, the information that Lender requires may seem intrusive. This is far from the truth. The Lender is obligated to protect both sides. No argument that the Lender is requiring a substantial amount of disclosure but there is a definite logic behind the questions. For example, the Cover Sheet includes questions that are directed at the financial health of the borrower such as the borrower’s FICO or Credit Score as well as Net Worth. These seem contradictory to the statement that our Lender does not consider the Borrower’s credit worthiness as a part of their lending decision. The reality is that our Lender views this as a business transaction where two parties come together and to their credit, our Lender wants to make sure that they understand who the Borrower is and how the Borrower has managed their finances to date. A Borrower may or may not have a lot of cash on-hand but they pay their bills and may have a substantial amount of real estate or other tangible assets. That is a very positive consideration because it tells the Lender that the Borrower knows how to manage money which is obviously a very important consideration. On the other hand, if the Borrower has no money and has declared bankruptcy then they may not be viewed as a good business partner.
As a part of the Lender’s evaluation criteria, they are also looking to see what money the Borrower has invested in the project and what is available for future investment. Fundamentally, our Lender wants to know that the Borrower is also very motivated to make the project work. The best way to ensure that the Borrower is motivated is to ensure that the Borrower also has something tangible to lose if the project fails. In other words, does the Borrower have any of their own money invested into the project or is it only the Lender’s money that is at risk. Our Lender wants to know that both parties are in this together which means that both parties want to see the project completed successfully. In other words, both parties have an invested interest in the project’s success. From our Lender’s perspective, if the Borrower has nothing tangible (money and/or assets) into the project and the project fails, then the Borrower basically has nothing to lose other than future revenue potential. On the other hand, if the Borrower also has money into the project, then both our Lender and the Borrower have something to lose if the project fails. The Borrower is very motivated to do whatever is necessary to ensure that the project will not fail which in turn means that the Lender’s money should be secure.
Why Danarg?
Why do business with Danarg? Great question!!
Aside from the big banks, there are some lenders out there today. Some are better than others and the purpose of this document is not to try to persuade anyone that we are the only credible lender. We hear every day of people losing their investments to fraudulent money schemes. But we do believe that there are also some distinct differences between using our services over a “Bank”. First, we have a Private Lender. That means that our lender has a lot more flexibility in deciding what they will and will not fund. Many banks do not traditionally fund Start-Up projects because of their lack of an entrepreneurial nature. Banks by their nature are very risk adverse and lending money into entrepreneurial projects such as electronic and/or entertainment industry is not part of a typical bank’s portfolio.
Another important factor that Danarg believes is a significant differentiator to other lenders is related to the general posture of the lender. Some lenders (private lenders as well as the banks) want to be able to exercise a significant amount of influence over the Borrower’s business. They do this on the pretense that they want to be able to ensure the security of their loan. This can be a significant constraint to the way that the Borrower manages their business and for confidentiality reasons, the Borrower may decide to delay some strategic decisions which can have a negative impact regardless of whether the lender’s money is involved or not. Our Lender does not want your first born, your house or your private assets. We do not insist to sit on your board or tell you how to run your company. This is your business and you know how to manage it. We have been told by several clients that they had tried to work with traditional bank. Some even paid several hundreds of thousands of dollars to cover Due Diligence costs only to be informed at the last possible moment that not only had they had been turned down but that the fees that they had paid were also not to be returned. The banks typically show a real interest in the initial stages. They tell them to send the documents and the answer is “Loan Declined”.
Our Lender’s funding program has been accepted in the European Union (E.U.) because of its exceptional terms, low interest rates and solid return on investment to our private investors. The reason is because our finance programs use Cash Backed Bank Instruments (BGs / SBLCs guaranteed by the client’s bank). The benefits to the borrowing clients are:
• Low Interest or Principal Payments until the project has been completed;
• An exceptionally Favorable Interest Rate (currently set at 2.5% plus approximately 1% Libor);
• No PERSONAL Guarantee(s);
• They do not use PERSONAL CREDIT as a party of their approval criteria;
• Lending Fee(s) are very competitive;
• Funding is usually “Quicker to Close” → gets your project up and running sooner;
• Normally no outside involvement in running your business or sitting on your board.
The Lenders Consortium gets a fair return on their investment and the Borrower gets a low interest rate unheard of in a conventional loan. In fact, some banks come to us because they can’t help their clients fund their projects at our competitive rates.
Another very important consideration that the Borrower needs to understand is the type of project that our Lender is looking to fund. Our Lender is actively seeking projects that fall into any of the following categories:
• Development Projects;
• Construction Projects;
• Infrastructure Projects;
• Green Energy Projects;
• Buyer/Sellers mandate for a variety of different types of mines;
• Buyer/Seller mandate for commodities including gold, diamonds, oil and gas, coal, other natural resources;
Funding Process
Before any project receives money from our lender, the borrower/project must successfully pass through six Funding Gates. These gates are:
- Preliminary Project Review
- Establishing of an European JV-Project Development Shareholding Company
- Proof of Funds (20%) of project-financing volume on own European JV-Project Development – Shareholding Company,
- Business Plan including feasibility study,
- Project Submission and with all data, licenses, project owner’s records, etc.
- Project Due Diligence by our Lender.
Throughout the Funding-Process, the borrower will be required to provide complete disclosure about any details that could possibly affect the project. During the Due Diligence phase, our Lender acknowledges that they are going to incur expenses and the token amount of money paid by the borrower does not cover all of these expenses. Our Lender is assuming the difference as a “Cost of Doing Business” expense that it incurs to ensure that only projects where our Lender’s money is totally secure are funded.
( The Borrower should assume that the entire funding process will take between 120 and 180 days. This timetable is driven by European Law as well as the Lender’s internal processes. In some circumstances, this period can be shortened but that will only be possible if the Borrower is able to promptly respond to any and all requests from the Lender for project documentation.)
Preliminary Project Review by Danarg
In the Preliminary Project Review phase, the Borrower will provide high-level information about the project through our Project Review sheet. The purpose of the Project Review sheet is to prescreen projects so that both parties share an understanding about the project and our Lender’s basic criteria before the Funding Process gets started. At the end of this phase, the borrower will be aware of their financial obligations and our Lender will have a conceptual understanding of the project. Both parties are going to spend a lot of time and energy preparing documents and exchanging information. It is not in either party’s interest to waste valuable time on a process that has no chance of succeeding.
Project Submission and Pre-Approval
There are three documents required for Project Submission. The Borrower is encouraged to produce these documents themselves following a set of guidelines and templates that Danarg will provide. These are: a Cover Sheet, the Pro Forma financials and an Executive Summary. At first, these documents may seem a bit daunting but we have created a sanitized version of all three of these documents that will show you exactly what is required. If the Borrower does not have the necessary internal resources to produce these documents, then the Borrower can purchase additional consulting services from Danarg who will work with the Borrower to get the documents ready for submission.
The Cover Sheet provides our Lender with a high-level summary of the borrower and the project’s ‘Use of Funds’. As the reader can see in the Appendix II, the information that is required is fairly straight forward. We caution you to ensure that all of your responses are on the conservative side when calculating for any projecting revenues, margins and LTV (Loan to Value) data because the due diligence phase of the project is very thorough. If any lofty overstatements are uncovered by our Lender’s Analyst Team during the due diligence phase then it is a distinct possibility that the project and the borrower would be discredited, resulting in a total rejection of the entire project.
The Proforma financials that we submit are very different from the type of statements that would be produced by an accountant. Corporate financial statements such as a Balance Sheet, Cash Flow and Income Statement are providing historical information to an owner or investor. The lender needs to know about how much money the borrower will need and when the borrower needs those funds as they complete their project. As an example, we have provided a sample Pro Forma statement for a fictional office building (see Appendix III) which shows that the project has 13 phases. The first phase (Project Planning) includes a requirement for € 5 million in January 2013 2012 but the expenditures for Floors do not start until May 2014.
The last document that must be submitted is the Executive Summary. This document is probably no more than 6 – 10 pages in length. Its purpose is to provide the reader with some background on the borrower and the project. The Executive Summary should provide information at a very high level.
Within 5 – 10 business days after the submission, the Lender will do a complete review of the Cover Sheet, Proforma financials and Executive Summary. These are the only documents that the Lender will consider when they are determining if the project suits their criteria. At the end of this process, our Lender will notify the borrower whether their project has been accepted or rejected. If our Lender is interested in working with the Borrower on this project, the Borrower will be provided with a Project Pre-Approval agreement. If our Lender is not interested in the project and it is rejected then the Lender file is closed and the project will not be reconsidered.
It is very important that both parties are comfortable with each other. The Borrower is encouraged to do their own Due Diligence on our Lender while our Lender is doing their Due Diligence on the Project and Project Owner.
( The Borrower should note that use of Danarg’s consulting services does not have any influence with the Lender’s approval process. The Borrower still assumes all responsibility for the accuracy and content of the submission documents)
Project Due Diligence
Once the project has been pre-approved, then the due diligence phase begins. The due diligence phase of the project usually takes between 30 to 60 days to complete. The borrower should be aware that the faster that they respond to requests for information from our Lender, the faster the process will move during the due diligence period. Delays to information requests from our Lender will extend the due diligence period. Our lender has documented cases where the due diligence period has been extended dramatically primarily because the client did not respond to requests for information in a timely fashion.
In this part of the project review, our Lender’s staff will do a complete analysis of the project. Here is where both parties (mostly on the Lender’s side) are going to incur some expenses. Our Lender will usually spend between € 40,000 and € 100,000 in Attorney Fees, salaries for Financial Analysts and other related expenses to do a very detailed review of the project.
When the Lender informs the Borrower that the project has been Pre-Approved, the Borrower will be asked to sign their acknowledgement of the notice that will also include the initial offering of terms and conditions of the loan. They will also be asked to pay a Euro 50, 000, – “Non-Performance fee” to our Lender (this will be guaranteed by DANARG). Subject to conditions, this fee is to be refunded back to the Borrower at the end of the Due Diligence phase. As an example, if during Due Diligence, our Lender has found some information through no fault of the Borrower that suggests that this is not a good project to fund, the fee is refunded. If the project successfully completes the Due Diligence phase and the project moves to the next phase, the Non-Performance fee is also refunded. However, if there is fraud or misrepresentation by the Borrower then the Borrower forfeits the Non-Performance fee so that our Lender can offset some of their costs.
The Borrower should expect an onsite visit from our Lender’s team where the Borrower will be asked to produce an extensive list of documentation. The onsite team will consist of experts in construction financing who also understand the economics of the region which means that they already have a very good idea about the costs for labor, utilities and materials. The onsite team will review all of the expenses that the borrower has included in the estimate for the costs of the project. At the end of their analysis, they may suggest that the borrower should adjust the amount of money that they need by increasing or decreasing some of their estimates. These recommendations are not attempted by our Lender to blindly increase the borrower’s requirement for capital. Recommendations for changes to the
amount of capital required are provided to ensure that the borrower has the money that they need to
be successful while ensuring that all of the funds are appropriately used. Our Lender wants the borrower to be successful because a successful project also ensures that our Lender’s capital is secure.
As the reader can see, the due diligence phase of the lending process is very thorough. If the Borrower indicated on their cover sheet that they had purchased the property that will be used for the project, then our Lender will want to see the deed and the purchase agreement. If the borrower indicated that they have spent time and money clearing the land and installing services, the borrower can expect that our Lender will want to visit the site to confirm the progress. Misinformation about the project will not be viewed favorably and will probably mean an immediate termination of the due diligence phase, cancellation of any agreements and forfeiture of the Non-Performance fee.
As our Lender’s analysts are spending their time with the borrower’s project estimators, our Lender is also working with the borrower to create a living Term Sheet. This document contains the outcome of all of the negotiations between our Lender and the borrower. This is where the borrower and our Lender agree on critical details about the working relationship for items such as repayment terms, project duration and interest rate, terms of the loan etc. It is also where the results of the onsite team’s analysis are a key component to determine the milestones that will trigger subsequent tranches that let the project continue.
We recognize that many other projects we fund other than construction and infrastructure will be treated differently, but the same due diligence still applies.
Once the project has completed the Due Diligence phase and the Living Term Sheet has been signed by both Parties, the Cash Project-Financing is ensured, the funding amount is guaranteed and set aside for the borrower and his project budget plan.
At no additional cost to the borrower, our Lender will assign a personal account executive to the project that will be the interface between the borrower and our Lender. This person will work closely with the borrower’s project management team. As the project proceeds through the phases and steps that were outlined in the Pro Forma financials, the account executive has the full authority to release funds to the project. Tranches will be paid to the borrower based on milestone achievements. Our Lender understands that the exact timing of the completion of the phases may not necessarily happen according to the timing in the project plan. Some phases will finish sooner while others will be delayed. This is a significant benefit to the borrower because if a phase is completed sooner than expected then additional funds can be released immediately.
It is also very important to note that the agreement with our Lender will state that the borrower is not expected to make any payments until all of the tranches have been paid out according to the funding contract.
Appendix I – Preliminary Project Review
Borrower Name: |
Primary Contact: |
Contact Phone: |
Number: Project Name: |
Project Location: |
Funds Required: |
Brief Project Description: |
How much cash does the borrower have that could be used as their investment into the project, or be used as a Proof of Funds? |
Are they looking for investors or a loan? |
Does the borrower have at least 25 % cash in to their project already invested? |
Does the borrower have collateral of at least 25% of the funding amount? |
Is there any other information such as 3rd party loan guarantees, existing signed contracts that guarantee revenue, etc. that would help the lender when he is evaluating this project? |
Signature |
Date: |
Appendix II – Cover Sheet
This form needs to be completed by the borrower and all information must be completed. It will be used to qualify your project/loan. Based on the information you provide, if our Lender is interested then our Lender will request other documents.
PLEASE NOTE: Submissions that include responses such as: “See our Website” or
“See Attached” or N/A will be rejected and will not be reconsidered.
This form is to be used for Acquisitions, Development Projects and Construction Loans.
Borrower: Name of Company that is borrowing the funds |
Borrower personal contact information including name, phone numbers, address and e mail address: |
Name: Details for officer who will be the primary contact |
Home Address: |
Email: |
Cell Phone Number: |
If the borrower is a corporation or LLC, please provide the following: |
Corp or LLC ID #: |
Date Incorporated: |
Country and State: |
Corporation or LLC Address, Telephone, cell phone, fax, e mail address and title: |
Company Name: Full corporate details |
Address: |
Title: |
Email: |
Office Phone Number: |
Cell Phone Number: |
Fax Number: |
Structure: In most cases, a loan is preferred. Our Lender is not looking for investment opportunities. The mandate of our Lender is to ensure that projects are financially viable with solid checks and balances. The safety of our Lender’s money is paramount. That is why the interest rate is so low. The ideal term for any project that our Lender accepts is five years or less. In many cases, this is not practical in which case the borrower has four options: 1. Negotiate a longer term with our Lender; 2. The borrower can pay off the loan at the end of the five year term; 3. The borrower and our Lender can work together to find a 3rd party that is willing to assume the loan; 4. The borrower can work independently to find a 3rd party that is willing to assume the loan. While not preferred, our Lender will entertain a proposal for a Joint- Venture in which case they will become an investor. In that scenario, the lender will do an equity partnership of 50% to 60% and no buyout clause. When the loan is repaid, the equity goes back to the borrower. |
How much cash money does the borrower have into the project: What is the total amount of money that the borrower invested to date or is prepared to invest once the project is approved? This question is very important because it is a clear indicator to our Lender whether the borrower is serious about making the project a success. If the borrower does not have any money in the project or is not prepared to invest any of their money then that means that our Lender is the only party that has funds at risk. From our Lender’s perspective, that is not an acceptable risk. |
Purpose of Loan: Provide a clear statement about the Use of Funds. Remember that our Lender is not providing Working Capital. This is asset backed lending. The funder needs to be able to see assets (finished or work in progress) because they are going to attach a lien on those assets to protect their capital. |
Project: A high-level summary of the project. This may include a brief description of the project with brief references to the revenue and EBTIDA. When the project is reviewed, our Lender will start with the Cover Sheet and the Pro Forma financial statements. If those two documents are of interest, then the reader will move to the Executive Summary. The description that is in this document must be brief enough that our Lender can determine their level of interest from an economic and business perspective. The text in the Executive Summary will provide additional details. |
Project name: Project Name |
LTV: Simple LTV calculation |
Future Value of Project when completed: Once the project has been completed, what is a realistic value of the project? |
Entitlements, Status: Does the borrower own the assets outright or are the assets of the project shared with another corporation |
Infrastructure in place: Does the project have the necessary infrastructure? This could include everything from roads and utilities |
Location of the project: |
Exit Strategy: What is the borrower’s exit strategy? How will the borrower pay off the loan |
Loan Amount Requested: Full amount in EURO, U.S. Dollars, SWISS Francs, Pound Sterling. |
FICO of the borrower, officers or managing members of known: Borrower’s FICO Score |
Net Worth of the borrower, officers or managing members: |
Liquidity of the borrower, officers or managing members: how much cash do you have on hand? |
What lenders have seen this loan request? None |
Borrower must disclose any funds that were paid in advance to a company, broker or consultant in connection with receiving a loan. Please list the person’s name, company, amount and description of the services: None |