Advanced Medical Technology Corporation Case

Purpose of the Loan:

The purpose of this loan is to offshore the shortage of cash that the company has been experiencing, in order to finance its activities. In Addition this loan request for $8 million to Tom Winter’s Bank of San Francisco is due to the fact that Sunnyvale Bank from which Mr. Haskins’ company has had a credit line of $6 million would not increase the latest line of credit.

Customer Relationship:

Mr. Haskins has never been a customer of Tom Winter’s Bank of San Francisco. Both men do not have a relationship together. Mr. Winter is not familiar with AMT’s products although has handled the accounts of several similar types of technology companies. This first loan request if accepted will be the best way of establishing a hopefully long relationship between Mr. Haskins and Mr. Winter.

Business and Strategy:

Advanced Medical Technology Corporation develops manufactures and sells scientific medical instruments, needles and catheters that allow rapid and less invasive access to a number of different organs and vessels.

AMT’s strategy for sustainable and extraordinary growth has been based on these main methods:

* Heavy spending on research and development

* Market expansion, resulting in rapid sales growth in excess of 30% per year

* Heavy reliance on short-term credit by leasing some manufacturing facilities and establishing a connection with Biological Labs, Inc.

* AMT’s agreement with Biological Labs, Inc. for a cash payment of $7 million in exchange for 5% of outstanding shares as well as the right to purchase additional shares at a higher price.

Five Forces Analysis:

* Threat of New Entrants: The threat of new entrants is low because any new entrants willing to enter this industry will need to start up with a heavy investment. A new entrant will also face the pressure of high spending on research and development. The competition will be really hard for any new entrants.

* Bargaining Power of Suppliers: AMT has...