# MOR distribution. Step #1

## Overview

The `Distributor` contract is responsible for periodically allocating MOR rewards to registered deposit pools under a specific reward pool. The distribution process ensures that each deposit pool receives a fair share of MOR tokens based on its generated yield and token value in USD.

## Reward distribution flow

The distribution of MOR tokens is executed through the [`distributeRewards`](/smart-contracts/documentation/distribution-protocol/v7-protocol/contracts/distributor.md#distributedrewards) function and follows the steps below:

#### 1. Fetch Emission Rewards from RewardPool

The `Distributor` contract queries the `RewardPool` contract to calculate the total amount of MOR tokens to emit for a given reward pool over the elapsed time period. This is based on a linear decay model defined per pool.

```solidity
uint256 rewards = rewardPool.getPeriodRewards(
  rewardPoolIndex,
  lastCalculatedTimestamp,
  uint128(block.timestamp)
);
```

The contract updates the `rewardPoolLastCalculatedTimestamp` to the current block timestamp after fetching.

#### 2. Update Token Prices for Each Deposit Pool

The `Distributor` updates USD prices for all deposit tokens in the reward pool using Chainlink data feeds:

```solidity
bytes32 chainLinkPathId = chainLinkDataConsumer.getPathId(depositPool.chainLinkPath);
uint256 price = chainLinkDataConsumer.getChainLinkDataFeedLatestAnswer(chainLinkPathId);
```

This ensures that all token values are normalized to the same unit (USD) before comparison.

#### 3. Calculate USD Yield Per Deposit Pool

For each deposit pool, the protocol calculates the **USD-denominated yield**:

```solidity
uint256 yield = (tokenBalance - lastUnderlyingBalance).to18(decimals) * tokenPrice;
```

* `tokenBalance` - current token or aToken balance held by the contract.
* `lastUnderlyingBalance` - previously recorded balance (after last reward allocation).
* `to18()` - utility to normalize token decimals to 18.
* `tokenPrice` - latest USD price from Chainlink.

The `lastUnderlyingBalance` is updated after this step.

#### 4. Compute Yield Shares and Assign Rewards

Once all yields are collected and expressed in USD, the contract calculates the **relative share** of each deposit pool:

```solidity
uint256 rewardShare = (poolYield * totalRewards) / totalYield;
```

* `poolYield` - USD yield of the deposit pool.
* `totalYield` - sum of all deposit pool yields.
* `totalRewards` - emission amount retrieved from `RewardPool`.

Rewards are then added to the `distributedRewards` mapping:

```solidity
distributedRewards[rewardPoolIndex][depositPoolAddress] += rewardShare;
```

If `totalYield` is zero, rewards are temporarily stored in `undistributedRewards`.

## Notes

* For private pools (strategy `NO_YIELD`), all rewards go to the only pool registered under that reward index.
* The reward assignment is proportional to real yield, meaning pools with higher dollar-denominated yield get more MOR.

***


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