If the 10 day WVAP was to equal say $4.80 SQC would only receive 416000 shares for their $2million investment.
If on the other hand the WVAP was to equal say $3.80 they would only get 493,827 shares for their $2 million. In other words they would be paying a premium.
Simply put SLX have placed a floor price of $4.05 but have placed a ceiling of the 10 day WVAP. SQC are still committed to subscribing for $2 million of shares the maximum number of shares they may receive is 493,827 but they will probably receive much less.
It is great deal for SLX shareholders we get all of the upside.
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