Could use some pointers on this question:

An entrepreneur and a venture capitalist are negotiating a first round of financing and reach an impasse.The entrepreneur believes his company isworth $5 million (equivalent to$1.00 per share given the 5million fully diluted commonshares outstanding beforethe new round).The venture capitalist is eager to do the deal but believes the correct valuation is only $4 million ($0.80 per share). She wants to invest $4 million at that price and has proposed a simple convertible preferred with weighted average anti-dilution protection.To break theimpasse, the venture capitalist proposes to pay $1.00 per share of standard convertible preferred but asks for a 5-year option to invest $3 million in a new convertible preferred stock at a 20% premium (i.e., $1.20 per share).

What valuation is the venture capitalist assigning to the company?What is the equivalent current price per share? If you think of the venture capitalist's option to buy shares in terms of their warrant equivalent, what is the value of those warrants?