(x)  Step Ten: Consider the Offset Potential of Cancelable Commitments.

In Steps Five and Seven, you estimated the costs the contractor will be committed to incur when cancellation occurs. Could the contractor cancel any of those commitments?

(A)  If a significant portion of the commitments would be cancelable and you can quantify it, treat it as an offset to the cancellation ceiling. Enter your estimate in Figure 6.A.

(B)  If, on the other hand, you do not know whether a significant portion of the commitments would be cancelable, assume there is no significant offset potential, enter a zero in Figure 6.A, and move on to Step Eleven.