Since I have not seen the contract & any other docs, and do not know the facts, etc. I can only give you general information, not advice. As with many legal issues there is no "yes or No" answer (that's why we have judges), at least at this stage of the game.

Roofing sounds fairly expensive so you should have an attorney look at the contract (should not cost much). Thoughts that come to mind are:

1. "Cancellation" is a defined term under home remodeling statutes where the homeowner (it appears this is not a business roof) has a right to cancel in three days regardless of what the contract says.

2. Otherwise, it appears that you are on the right track in avoiding the term "cancellation" either (1) expressly NOT cancellation - something like "earnest money carried over to new contract to be applied to work done - new contract amends the contract dated ____ but does not supersede or cancel it." (2) leave area unaddressed to preserve argument rather than concede is cancellation

3. I am puzzled by contractor's use of the term cancellation as a forfeiture term in a consumer contract because walks right into another meaning and public policy adverse to the contractor. (I haven't looked to see if law allows this.)

4. Be careful that second contract does not cure some defect in the original contract adverse to the contractor.

Again, given the downside risk versus the cost I would have somebody look at this.

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