Box 1: 4 -
20%, minimum percentage of hosts, of 20 session hosts is 4 hosts.
Box 2: evenly across all available session hosts
The load balancing algorithm is breadth-first.
Breadth-first load balancing allows you to evenly distribute user sessions across the session hosts in a host pool.
Reference:
https://docs.microsoft.com/en-us/azure/virtual-desktop/host-pool-load-balancing