MELA Sciences Completes Private Placement to Institutional Investors and MELA Sciences Directors

  MELA Sciences Completes Private Placement to Institutional Investors and
  MELA Sciences Directors

Business Wire

IRVINGTON, N.Y. -- February 5, 2014

MELA Sciences, Inc. (NASDAQ:MELA), (the Company) developer of MelaFind^®, an
FDA approved optical diagnostic device that assists dermatologists in melanoma
diagnosis, today announced the closing of its previously announced $12.45
million private placement of convertible preferred stock, common stock
warrants and common stock. Net proceeds to the Company from this offering are
approximately $11.5 million.

The Company issued 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 issued 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.

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 purchased $0.15 million in restricted common stock priced at
$0.74 per share. 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 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.

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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