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So once you have your theoretical replacement cost for each Transaction, you then have to tot up all the {{{{{1}}}|Unpaid Amount}}s that had fallen due but had not been paid under those {{{{{1}}}|Transaction}}s at the time the {{{{{1}}}|Transaction}}s terminated. These include, obviously, failures by the {{{{{1}}}|Defaulting Party}}, but also amounts the ''{{{{{1}}}|Non-defaulting Party}}'' didn’t pay when it relied on the [[flawed asset]] provision of Section {{{{{1}}}|2(a)(iii)}} to withhold amounts it would otherwise have been due to pay under the Transaction after the default but before it was terminated.<ref>There is a technical exception here for Parties under a {{1992ma}} under which the {{isda92prov|First Method}} applies. But since the {{isda92prov|First Method}} is insane and no-one in their right mind would ever have it in a live contract, we mention it only for completeness.</ref> | So once you have your theoretical replacement cost for each Transaction, you then have to tot up all the {{{{{1}}}|Unpaid Amount}}s that had fallen due but had not been paid under those {{{{{1}}}|Transaction}}s at the time the {{{{{1}}}|Transaction}}s terminated. These include, obviously, failures by the {{{{{1}}}|Defaulting Party}}, but also amounts the ''{{{{{1}}}|Non-defaulting Party}}'' didn’t pay when it relied on the [[flawed asset]] provision of Section {{{{{1}}}|2(a)(iii)}} to withhold amounts it would otherwise have been due to pay under the Transaction after the default but before it was terminated.<ref>There is a technical exception here for Parties under a {{1992ma}} under which the {{isda92prov|First Method}} applies. But since the {{isda92prov|First Method}} is insane and no-one in their right mind would ever have it in a live contract, we mention it only for completeness.</ref> | ||
====...''then'' calculate net {{{{{1}}}|Early Termination Amount}}==== | |||
The close out itself happens under Section {{{{{1}}}|6(e)}} of the {{isdama}} and the recourse is to a net sum. Netting does ''not'' happen under the {{{{{1}}}|Transactions}} — on the theory of the game there are no outstanding Transactions at the point of netting; just payables. | The close out itself happens under Section {{{{{1}}}|6(e)}} of the {{isdama}} and the recourse is to a net sum. Netting does ''not'' happen under the {{{{{1}}}|Transactions}} — on the theory of the game there are no outstanding Transactions at the point of netting; just payables. | ||