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The Replace Order Message allows you to alter most of the attributes of an order in a single message. This is more efficient than canceling an existing order and immediately succeeding it with a new order. Replacing an order always gives it a new timestamp for its time priority on the book. If you wish you simply partially cancel an order and retain its time priority, send a Cancel Order Message instead.

There are two Order UserRefNums in the Replace Order Message. The first must be filled out with the Order UserRefNum of the existing order; the second must be a new Order UserRefNum for the replacement. The replacement Order UserRefNum must be unique in the same way as Order UserRefNums are in the Enter Order Message, and replacement Order UserRefNums may not be the same as the UserRefNum sent in Enter Order Messages. Any replacement Order UserRefNum that has already been used in another Enter Order Message or Replace Order Message will be ignored.

NASDAQ may respond to the Replace Order Message in several ways:

1. If the order for the existing Order UserRefNum is no longer live or if the replacement Order UserRefNum was already used, the replacement will be silently ignored. The replacement Order UserRefNum will not be consumed and may be reused in this case.
2. If the order for the existing Order UserRefNum is live but the details of the replace are invalid (e.g.: new Shares >= 1,000,000), a Cancel Order Message will take the existing order out of the book. The replacement Order UserRefNum will not be consumed, and may be reused in this case.
3. If the order for the existing Order UserRefNum is live but the existing order cannot be canceled (e.g. the existing Order is a cross order in the late period), there will be an Order Reject Message. This reject message denotes that no change has occurred to the existing order; the existing order remains fully intact with its original instructions. The Order Reject Message consumes the replacement Order UserRefNum, so the replacement Order UserRefNum may not be reused.
4. If the order for the existing Order UserRefNum is live and can be replaced, you will receive either a Replaced Message or an Atomically Replaced and Canceled Message.

Replace Order Messages may be chained together, so that a single order is replaced over and over again. There is no limit to the number of replaces; however no single order/replace chain may execute more than 999,999 shares cumulatively.

The Shares on the replace denote the total number of shares liable for the whole chain. Here is an example:

• Enter Order Message for 500 shares
• Accepted Message for 500 shares
• Executed Message for 100 shares

At this point, you decide to replace the order. If you want to be exposed for

• the remaining 400 shares, send the Replace Order Message with 500 Shares. This 500 equals the 400 exposed plus the 100 previously executed.
• a new 500 shares, send the Replace Order Message with 600 Shares. This 600 equals the 500 new shares plus the 100 previously executed.

This may seem a bit confusing at first, but it inhibits the risk of double-liability throughout the order/replace chain.