Question-and-Answer Session
Operator
Ladies and gentlemen – yes – (Operator Instructions). Your first question coming from Bret Jones – Leerink Swann.
[Winston Coates] for Bret Jones – Leerink Swann
Good morning, this is [Winston Coates] and I'm calling in for Bret. Judging by your new, your system sales and the backlog, we're estimating that you added about $9.2 million in new system backlog for the quarter, which would be the lightest for the year.
So we just want to know, did you see any slow downs in purchases of new system sales?
J. Boyd Douglas
Compared to the second quarter certainly, we talked – I believe that was the second quarter we had such a strong system sales – so but certainly down, but we were certainly pleased with the number of contracts we signed during the fourth quarter.
[Winston Coates] for Bret Jones – Leerink Swann
Okay, well have you experienced any change in cancellations this quarter?
J. Boyd Douglas
We have not. In fact, that was one reason our numbers came in a little higher than what we thought. We were expecting maybe a little bit of slippage, but there was actually none at all, and in fact we were able to add a couple add-on sales we weren't really expecting. So that's why the number ended up being a little better than the guidance we gave.
[Winston Coates] for Bret Jones – Leerink Swann
Okay, well just in case you have a cancellation, how are your contracts structured? What sort of protections do you have in your contracts?
J. Boyd Douglas
It really varies contract to contract. We do have some that there are penalties, where we set the installation month and if that isn't met, then there are penalties for the hospital, maybe some of the discounts get taken back or whatever. So they're all structured a little bit differently, but most of them do have some sort of penalty for the hospital if they don't go in and be set.
As you know, the way our business is structured, we have a certain number of limited resources and we can only do so many installs per month. So it's very important to us to get those in, so we are protected contractually.
[Winston Coates] for Bret Jones – Leerink Swann
Okay and looking at your balance sheet it appears that you're doing some more financing. Are you seeing more of your customers seeking vendor financing because they're having trouble accessing other credit lines?
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