# Pricing Calculations

When investors redeem their tranche tokens, the amount of currency they receive depends on how much of the pool’s repayments have been collected and the investor’s share of the tranche. Qiro uses a transparent, formula-based approach to ensure fair and pro-rata redemption for all investors.

Below is an overview of the key variables used in the redemption price calculation.

#### **Key Variables**

| **Variable**                | **Description**                                                                  |
| --------------------------- | -------------------------------------------------------------------------------- |
| **TrancheValue**            | Total expected value of the tranche (Principal + Expected Interest – Write-offs) |
| **TotalRepaid**             | Total repayments collected so far for the tranche (Principal + Interest)         |
| **TokenReceived\[User]**    | Number of tranche tokens minted to the user                                      |
| **TokenRedeemed\[User]**    | Tokens already redeemed by the user                                              |
| **CurrencyRedeemed\[User]** | Currency already paid out to the user                                            |
| **UserShare**               | User’s share of the tranche = TokenReceived / TotalTokens                        |
| **TokenAmount**             | Tokens the user wants to redeem (input)                                          |

## **How Redemption Price Is Calculated?**

Before processing a redemption, the system determines two things:

1. **How many tokens the user is allowed to redeem**, based on their ownership and repayments collected.
2. **How much currency those tokens are worth**.

The process follows three steps:

#### **1. Maximum Tokens the User Can Redeem**

This ensures users cannot redeem more than their share of the tranche’s repaid amount.

```
MaxRedeemToken =
((TotalRepaid / TrancheValue) * TokenReceived[User]) 
    – TokenRedeemed[User]
```

#### **2. Maximum Currency the User Can Receive**

This represents the user’s pro-rata share of all repayments collected so far.

```
MaxRedeemCurrency =
(TotalRepaid * Share[User]) 
    – CurrencyRedeemed[User]
```

#### **3. Token Price at Redemption**

The redemption price floats based on how much has been repaid.

```
TokenPrice = MaxRedeemCurrency / MaxRedeemToken
```

***

##  **What This Means for Investors**

* The token price **increases as more of the tranche is repaid**.
* Redemptions are **fair and proportional**, based on actual repayments—not NAV estimates.
* Investors receive exactly their share of the collected repayments, even if they redeem at different times.