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The rules indicate the unit is severely pinned but has not lost the will to fight, only the ability for organized offensive action.

The game effects of a broken unit are:
(1) have no ZOC;
(2) cannot spot for indirect fire;
(3) cannot fire but they can defend themselves;
(4) cannot assault attack;
(5) cannot spot enemy units in detail, only as Unknown enemy units; and,
(6) at Maximum Fatigue cannot recover without an HQ.

Therefore, question is, as a player, what do you perceive this to mean?

Regards,
CptCav