Template:First method

Not generally used, under the First Method, a payment is only ever made by the Defaulting Party to the Non-defaulting Party. Which is a nice big fat free option against a defaulting party isn’t it. The First Method is thus a back door to withhold payments that otherwise would due under the ISDA Master Agreement, it is hard to see why anyone in their right mind would give away this kind of optionality at the commencement of a derivative trading relationship and, predictably, no one did. Very, very rarely seen.