UnderCut or OverCut: Reducing Gouging
Usually the leadin and leadout attach to the part cut at the same point, however the cutting process has a property OverCut which can be used to move the Leadout attachment beyond the leadin attachment (positive OverCut), or to start leading out before the leadin attachment point (negative OverCut => UnderCut). This can be set by properties, or when the parent cut process is selected by moving the Overcut handle.
Undercut is useful when leads must attach tangentially to a path with no corners, to reduce or avoid gouging the part where the leads attach. In some cases a large enough undercut is used to leave a small "nipple" on the part which can be ground off in cleanup afterward. Hypertherm TrueHole makes use of a mixture of UnderCut and OverCut, the path carries on past the leadin but the arc turns off before it while still in motion. However on TouchCut Controllers the undercut is applied by the machine itself, and the programming software does not need to specify it.
Cutting Tool Setting: Overshoot
This is a default setting for OverCut, and is applied only when placing a lead away from a corner, on a flat or arc.