(From the Cosmic Dominion rulebook)
Retreat is a new type of encounter card that represents completely avoiding conflict. When a retreat and an attack card are revealed by opposing players, the retreating player automatically loses the encounter, but the ships on his on her side live to fight another day. When a retreat and anything else are revealed by opposing players, the retreat turns into a regular negotiate card, and both players attempt to deal. A retreat card modifies itself before other game effects occur.