Page 7 of 10 – SEC Filing
| Item 4. | Purpose of the Transaction. |
Item 4 of Schedule 13D is supplemented and superseded, as the
case may be, as follows:
On November 8, 2017, the Adviser acquired beneficial ownership
of 280,263 shares of common stock of Mirati Therapeutics, Inc. (the “Issuer”), held directly by 667, Life Sciences,
and 14159, as a result of the exercise of 280,263 warrants to purchase the Issuer’s common stock at $7.86 per share with
an expiration date of November 21, 2017 (the “2017 Warrants”). The amount expended on acquiring the common stock was
$192,302.76 for 667, $1,963,435.86 for Life Sciences and $47,128.56 for 14159, totaling $2,202,867.18. Each of the Funds funded
the exercise of the 2017 Warrants with their working capital.
On November 16, 2017, the Issuer entered into an underwriting
agreement (the “Underwriting Agreement”) with Cowen and Company LLC and Barclays Capital Inc., as representatives of
the several underwriters listed on Schedule A thereto (the “Underwriters”), related to an underwritten public offering
(the “Offering”) of 2,015,901 shares of the Issuer’s Common Stock at a price to the public of $13.00 per share
and 4,137,999 warrants to purchase the common stock of the Issuer at purchase price of $12.999 per warrant. The warrants
have an exercise price of $0.001 per share with no expiration date (the “Pre-Funded warrants”). In addition, the Issuer
granted the Underwriters an option exercisable for 30 days from the date of the Underwriting Agreement to purchase, at the public
offering price less any underwriting discounts and commissions, up to an additional 923,085 shares of common stock to cover overallotments,
if any. The Offering is expected to close on November 20, 2017.
Pursuant to the Offering, on November 16, 2017, 667 and Life
Sciences (collectively the “Purchasing Funds”) purchased 304,392 and 1,618,684 Pre-Funded Warrant shares, respectively,
at the offering price of $12.999 per share. The Purchasing Funds purchased the shares of the Issuer’s Common Stock with their
working capital.
In connection with the Offering, the Funds and
the Issuer entered into a Board Observer and Director Rights Agreement under which the Funds have the right to nominate a board
observer to the Board of Directors of the Issuer (the “Board”) as long as the Funds and their affiliates own at least
3MM shares in aggregate of common stock and Pre-Funded Warrants and have the right to nominate a director to the Board
as long as the Funds and their affiliates own at least 3MM shares in the aggregate of the common stock and Pre-Funded Warrants
of the Issuer and 8% of the outstanding common stock of the Issuer (“Board Rights”). These Board Rights supersede the
existing rights to appoint an observer or director to the Board under the Securities Purchase Agreement dated November 9, 2012
by and among the Funds and MethylGene Inc.
The foregoing description of the Board Observer and Director
Rights Agreement does not purport to be complete and is qualified in its entirety by reference to the full text of the Board Observer
and Directors Rights Agreement, which is incorporated by reference as Exhibit 99.2, and is incorporated herein by reference.
The Funds hold securities of the Issuer for investment purposes.
The Reporting Persons or their affiliates may purchase additional securities or dispose of securities in varying amounts and at
varying times depending upon the Reporting Persons’ continuing assessments of pertinent factors, including the availability
of shares of common stock or other securities for purchase at particular price levels, the business prospects of the Issuer, other
business investment opportunities, economic conditions, stock market conditions, money market conditions, the attitudes and actions
of the board of directors and management of the Issuer, the availability and nature of opportunities to dispose of shares in the
Issuer and other plans and requirements of the particular entities. The Reporting Persons may discuss items of mutual interest
with the Issuer, which could include items in subparagraphs (a) through (j) of Schedule 13D.
Depending
upon their assessments of the above factors, the Reporting Persons or their affiliates may change their present intentions as stated
above and they may assess whether to make suggestions to the management of the Issuer regarding financing, and whether to acquire
additional securities of the Issuer, including shares of common stock (by means of open market purchases, privately negotiated
purchases, or otherwise) or to dispose of some or all of the securities of the Issuer, including shares of common stock, under
their control. Additionally, the reporting persons have a representative acting as a board observer of the Issuer and have
a right to nominate one person to the board of directors of the Issuer, subject to certain limitations.
