CORRECTING and REPLACING Melanoma Diagnostic Provider, MELA Sciences, to Raise $12.45 Million in Private Placement to

  CORRECTING and REPLACING Melanoma Diagnostic Provider, MELA Sciences, to
  Raise $12.45 Million in Private Placement to Institutional Investors and
  MELA Sciences Directors

Correction... by MELA Sciences, Inc.

Business Wire

IRVINGTON, N.Y. -- January 31, 2014

Second graph, second sentence of release should read ...13,297,297  shares of
common stock at an exercise price of $0.74. (sted ...11,714,286 shares of
common stock at an exercise price of $0.74.).

The corrected release reads:

   MELANOMA DIAGNOSTIC PROVIDER, MELA SCIENCES, TO RAISE $12.45 MILLION IN
   PRIVATE PLACEMENT TO INSTITUTIONAL INVESTORS AND MELA SCIENCES DIRECTORS

MELA Sciences, Inc. (NASDAQ: MELA), (the Company) developer of MelaFind^®, an
FDA approved optical diagnostic device that assists dermatologists in melanoma
diagnosis, today announced it has entered into definitive agreements with
institutional investors and management for the private placement of $12.45
million of the Company’s convertible preferred stock, common stock warrants
and common stock. The investors in the transaction were funds managed by Sabby
Management, LLC, which comprise the Company’s largest existing beneficial
shareholder, and Broadfin Capital, LLC. In conjunction with the financing,
MELA Sciences’ directors have agreed to purchase $150,000 in restricted common
stock priced at $0.74 per share, yesterday’s closing bid price for MELA’s
common stock.

Pursuant to the terms of the private placement, the Company will issue
non-redeemable preferred stock convertible at any time into common stock at a
conversion price of $0.84, amounting to 14,642,857 shares of the Company’s
common stock. Additionally, the Company will issue to the investors warrants
to purchase up to 13,297,297 shares of common stock at an exercise price of
$0.74. The warrants are immediately exercisable and will have a term of
exercise of five years. Broadfin has been granted the right to designate one
director to the Company’s Board of Directors. The Company will also issue
202,703 shares of restricted common stock to Directors for their agreed
investment of $150,000.

The investors have been granted resale registration rights with respect to the
shares underlying the preferred stock and warrants, as well as rights of
participation in future offerings of the Company’s securities.

MELA Sciences intends to use the net proceeds from this offering to re-launch
MelaFind focusing on the key dermatologists who treat many of the patients at
high risk for melanoma. Funds will also be used to support new clinical trials
and the expanded application of the technology and for general corporate
purposes, including working capital.

Rose Crane, MELA’s CEO and President, said “This offering provides us the
capital we need to turn our full attention to the business and the
introduction of MelaFind to key dermatologists. We are extremely encouraged by
the interest and support we are receiving for MelaFind within the dermatology
community and the reception we have had at dermatology conferences and events
over the last six months. It confirms our belief that this device has the
potential to become a standard of care for melanoma diagnosis, and that our
strategy to build awareness and usage within opinion leading physicians is
proving successful in its early stages.”

“We are delighted to have two great healthcare investors participate in this
funding as well as announce our management has personally invested. We look
forward to reporting our progress in the coming quarters.”

Craig-Hallum Capital Group acted as the exclusive placement agent in
connection to the offering.

The securities to be sold in the private placement have not been registered
under the Securities Act of 1933, as amended, or state securities laws and may
not be offered or sold in the United States absent registration with the
Securities and Exchange Commission (SEC) or an exemption from such
registration requirements. MELA Sciences has agreed to file a registration
statement with the SEC registering the resale of the shares of common stock
underlying the securities to be sold to in this private placement.

This press release shall not constitute an offer to sell or the solicitation
of an offer to buy these securities, nor shall there be any sale of these
securities in any state or other jurisdiction in which such offer,
solicitation or sale would be unlawful.

About MELA Sciences, Inc. www.melasciences.com

MELA Sciences is a medical device company developing dermatology diagnostics
utilizing state-of-the-art optical imaging. The flagship product is
MelaFind^®, an FDA, PMA and CE Mark approved, non-invasive diagnostic tool to
aid dermatologists in melanoma evaluation and diagnosis. MelaFind^® uses a
variety of visible to near-infrared light waves to evaluate skin lesions from
the surface to 2.5 mm beneath the skin. It provides images and data on the
relative disorganization of a lesion's cell structure that provides
substantial additional perspective to aid melanoma diagnosis. MELA is also
exploring new potential uses for its core imaging technology and algorithms.

Twitter:     MELASciencesIR or MelaFind
Facebook:     MelaFind
StockTwits:   MELASciencesIR
              

Safe Harbor

This press release includes "forward-looking statements" within the meaning of
the Securities Litigation Reform Act of 1995. These statements include but are
not limited to our plans, objectives, expectations and intentions and may
contain words such as “seeks,” “look forward,” and “there seems” that suggest
future events or trends. These statements are based on our current
expectations and are inherently subject to significant uncertainties and
changes in circumstances. Actual results may differ materially from our
expectations due to financial, economic, business, competitive, market,
regulatory and political factors or conditions affecting the company and the
medical device industry in general, as well as more specific risks and
uncertainties set forth in the company’s SEC reports on Forms 10-Q and 10-K.
Given such uncertainties, any or all of these forward-looking statements may
prove to be incorrect or unreliable. MELA Sciences assumes no duty to update
its forward-looking statements and urges investors to carefully review its SEC
disclosures available at www.sec.gov and www.melasciences.com.

Contact:

Media
MELA Sciences, Inc.
Diana Garcia Redruello, 212-518-4226
dgarcia@melasciences.com
or
Investors
Catalyst Global
Toni Trigiani, David Collins
212-924-9800
mela@catalyst-ir.com
 
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