According to the FAR (2017), the regulation is "A bilateral modification (supplemental agreement) is a contract modification that is signed by the contractor and the contracting officer (Far, 2017, FAR,2017, §43.103).   Explain why this is important because of the rules that follow that agreement? If a bilateral modification happens, both parties have to approve the modification. If the modification does not allow for the company to fulfill the needs, they can then back out or try to renegotiate at that point.