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This article describes how System Restore functions when you delete hard links.
If you delete a hard link to a file, and you run a System Restore operation, a new file that has the same name as the link is created. This file is not a link; it is a new file that has the same contents. For example, if you create a hard link called Hlink.exe that points to Original.exe, and restore point A is created, when Hlink.exe is deleted, the file is restored to restore point A. Hlink.exe is replaced, but this file is a copy of Original.exe, and not a hard link that is pointing to Original.exe. If you create a hard link, when the computer is restored, the link is deleted. The System Restore operation does not delete the file because there are other links to it. This behavior is by design.