MEDWELL CAPITAL AND SPECTRAL DIAGNOSTICS ANNOUNCE PLAN OF ARRANGEMENT

- $10 Million to be invested by Medwell in additional Spectral shares -
- 54 million Spectral shares to be distributed by Medwell to its shareholders -

TORONTO AND EDMONTON, June 28, 2011 /CNW/ - Spectral Diagnostics Inc. ("Spectral") (TSX: SDI) and Medwell Capital Corp. ("Medwell") (TSX-V: MWC), today jointly announced that they have entered into an arrangement agreement (the "Arrangement") whereby, pursuant to a plan of arrangement, Medwell will acquire a further 33,333,333 Spectral common shares (the "Spectral Shares") for $10 million, at a subscription price of $0.30 per share, the gross proceeds of which will be used primarily to advance Spectral's Toraymyxin, a treatment for severe sepsis, through to the end of its U.S. Phase III EUPHRATES trial and data release.

Pursuant to the Arrangement, Medwell will also distribute 54,282,834 Spectral Shares to its shareholders, representing approximately $16.3 million in value based on the $0.30 Spectral Share subscription price.  In general, such Spectral Shares are expected to be received by Canadian resident shareholders on a tax-deferred basis, provided that the tax cost of their Medwell Shares for Canadian tax purposes is not less than the value of the Spectral Shares which they receive.

"This transaction, which has the full support of Spectral management, will provide sufficient funds for any expansion or contingencies related to our pivotal EUPHRATES trial in the U.S. and for new market development activities in Canada and Europe," said Dr. Paul Walker, President and CEO of Spectral. "In addition, our shareholder base will be significantly broadened to over 7,000 retail and institutional shareholders, with no large controlling shareholder, will increase Spectral's float and has the potential to increase long term stock liquidity."

"We are very pleased to be making this further investment in Spectral, as this is an impressive late-stage technology with a large market opportunity and minimal competition," said Kevin Giese, President and CEO of Medwell Capital. "In distributing the Spectral Shares under the Arrangement, each Medwell shareholder will directly benefit by receiving approximately six-tenths (6/10ths) of a Spectral share for each Medwell share owned (or approximately $0.18 of value for each Medwell share owned, based on the $0.30 Spectral Share subscription price). Medwell will retain significant assets after the completion of the Arrangement, including a residual 13.4% ownership stake in Spectral, other investments and cash."

In connection with the Arrangement, Mr. Kevin Giese will be appointed as Chairman of the Board of Directors of Spectral after closing of the transaction. Subject to compliance with applicable laws and the constating documents of Spectral, from closing of the Arrangement and for so long as Medwell owns in aggregate not less than 10% of the issued and outstanding Spectral Shares (calculated on a non-diluted basis), Medwell will be entitled to specify two of the board nominees in any management proxy circular of Spectral prepared and sent to the Spectral shareholders in respect of meetings at which directors are to be elected.

Following the completion of the Arrangement, Medwell will hold approximately 15,200,000 Spectral Shares, representing approximately 13.4% of the issued and outstanding Spectral Shares (calculated on a non-diluted basis), and will also hold 15,200,000 Spectral warrants, which are exercisable at $0.60 and expire on March 2, 2014.

The closing of the Arrangement is subject to court approval, the approval of the Toronto Stock Exchange and the TSX Venture Exchange and other customary closing conditions.  The Arrangement is also subject to approval of the Medwell shareholders and approval of the disinterested Spectral shareholders at special meetings which have been called for Friday, August 26, 2011.  The record date for the purposes of determining shareholders of both Medwell and Spectral shareholders entitled to vote at their respective meetings has been set as the close of business on July 20th, 2011.  The Arrangement is currently expected to close at the end of August, 2011.

Both Medwell and Spectral have received fairness opinions in respect of the Arrangement.  The special committees and the boards of directors of both Medwell and Spectral have considered the Arrangement, unanimously support it and recommend that their shareholders vote in favour of it.

Further details of the Arrangement will be included in proxy circulars mailed to the Medwell and Spectral shareholders in due course.  The arrangement agreement will also be filed on SEDAR at www.sedar.com.

About Medwell Capital Corp.
Medwell Capital Corp. is a Canadian-based merchant bank that provides capital and advisory services to the healthcare industry.

For further information please visit www.medwellcapital.com.

About Spectral Diagnostics
Spectral is a Phase III company seeking U.S. FDA approval for its lead theranostics product for the treatment for severe sepsis and septic shock. Toraymyxin is a therapeutic hemoperfusion device that removes endotoxin, which can cause sepsis, from the bloodstream. Directed by the Company's Endotoxin Activity Assay (EAA™), the only FDA cleared diagnostic for the risk of developing sepsis. Spectral's EUPHRATES trial is the world's first theranostics trial in the area of sepsis.

Toraymyxin has been approved for therapeutic use in Japan and Europe, and has been used safely and effectively in more than 80,000 patients to date. In March, 2009, Spectral obtained the exclusive development and commercial rights in the U.S. for Toraymyxin, and in November, 2010, signed an exclusive distribution agreement for this product in Canada. More than 250,000 patients are diagnosed with severe sepsis and septic shock in North America each year, representing a greater than $1 billion market opportunity for Spectral. Spectral is listed on the Toronto Stock Exchange under the symbol SDI. For further information please visit www.spectraldx.com

Forward-looking statement

Information in this news release that is not current or historical factual information may constitute forward-looking information within the meaning of securities laws. Implicit in this information, particularly in respect of the future outlook of Spectral and Medwell, and anticipated events or results, are assumptions based on beliefs of Spectral's and Medwell's senior management as well as information currently available to it. While these assumptions were considered reasonable by Spectral and Medwell at the time of preparation, they may prove to be incorrect. Readers are cautioned that actual results are subject to a number of risks and uncertainties, including the availability of funds and resources to pursue R&D projects, the successful and timely completion of clinical studies, the ability of Spectral and Medwell to take advantage of business opportunities in the biomedical industry, the granting of necessary approvals by regulatory authorities as well as general economic, market and business conditions, and could differ materially from what is currently expected.

The TSX has not reviewed and does not accept responsibility for the adequacy or accuracy of this statement.

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