First One Capital Inc.

March 18, 2005 16:51 ET

First One Capital Inc. Announces Agreement In Principle Regarding A Proposed Qualifying Transaction


NEWS RELEASE TRANSMITTED BY CCNMatthews

FOR: FIRST ONE CAPITAL INC.

TSX VENTURE SYMBOL: FOC.P

MARCH 18, 2005 - 16:51 ET

First One Capital Inc. Announces Agreement In
Principle Regarding A Proposed Qualifying Transaction

TORONTO, ONTARIO--(CCNMatthews - March 18, 2005) - First One Capital
Inc. ("First One Capital") (TSX VENTURE:FOC.P), a capital pool company,
announces that on March 18, 2005, it has reached agreement in principle
with Red Media Corp. ("Red Media"), to provide for a proposed business
combination of the two companies by means of an amalgamation (the
"Business Combination"). The Business Combination will constitute First
One Capital's proposed qualifying transaction.

Under the proposed amalgamation, holders of common shares of First One
Capital will receive .37 of a common share of the amalgamated entity for
each common share held. First One Capital currently has 6,752,160 common
shares outstanding. The outstanding options and warrants of First One
Capital will be exchanged for 0.37 options or 0.37 warrants,
respectively, in the amalgamated company. Shareholders of Red Media will
receive one common share of the amalgamated entity for each common share
held (representing a deemed value of $0.90 per common share). Red Media
currently has 21,537,118 common shares outstanding. The outstanding
options and warrants of Red Media. will be each exchanged for one option
or warrant, as the case may be, of the amalgamated company and retain
their existing exercise prices. Red Media has outstanding 4,915,999
options, 4,565,995 warrants and 125,000 special warrants. On a fully
diluted basis, the amalgamated company results from the combination of
Red Media and First One Capital (the "Resulting Issuer") will have
34,018,737 common shares outstanding.

Red Media, established in Toronto, Canada in 2003, provides a unique
solution to Internet search technology by specializing in local search
using key word search parameters. It operates under the name
"redToronto" and its site can be found at www.redtoronto.com. For the
year ended March 31, 2004, its first full year of operation, Red Media
recorded audited revenues of $Nil and a net loss of $881,000. For the
ten months ended January 31, 2005, Red Media recorded unaudited revenues
of $649,000 and a net loss of $2,654,000. For the year ended March 31,
2006, Red Media has contracted revenue of approximately $2,500,000.

Red Media's business is located at 197 Spadina Ave., Toronto, Ontario.
Roger Abbiss, Chief Executive Officer of Red Media, holds directly and
indirectly 6,250,000 common shares (23.82%) on a fully diluted basis. No
other shareholder of Red Media holds more than 10% of the outstanding
shares.

Jeffrey Dawson and Chris Tambakis, directors and shareholders of First
One Capital are also directors and shareholders of Red Media. Owen
Menzel, an officer, director and shareholder of First One Capital also
holds directly and indirectly less than 0.5% of the common shares of Red
Media. As a result, the proposed Business Combination is considered to
be a non-arm's length transaction and may require majority of minority
shareholder approval.

It is intended that the following current directors and senior
management of Red Media will be insiders of the "Resulting Issuer":



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Name Background Role
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Roger Abbiss Chief Executive Officer,
Red Media Officer and Director
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Perry Dellelce Partner, Wildeboer Dellelce LLP,
Solicitors Director
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Timothy Gould President, Gould Leasing Ltd. Director
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Michael Holiday President, Harbour Printing and
Distribution Director
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Jeffrey Dawson President, Jeffrey Dawson
Insurance Agencies Limited Director
--------------------------------------------------------------------
Chris Tambakis Vice-President, Investment
Services Group, Colliers International Director
--------------------------------------------------------------------
Jeff Jackson Chief Financial Officer,
Red Media Officer
--------------------------------------------------------------------
Blair Calder Chief Technology Officer of Officer
Red Media (through Offsite Corp.)
--------------------------------------------------------------------
Lynne Guthrie Vice President, Training, Red Media Officer
--------------------------------------------------------------------
Ian Grieve Vice President, Sales, Red Media Officer
--------------------------------------------------------------------
Sandra Antoniani General Counsel, Red Media Officer
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As well, Owen Menzel, the current Chief Executive Officer and a director
of First One Capital, will be nominated to the board of directors of the
Resulting Issuer and will be an insider of the Resulting Issuer.

Completion of the transaction is subject to a number of conditions,
including but not limited to, Exchange acceptance and if applicable
pursuant to Exchange Requirements, majority of the minority shareholder
approval. Where applicable, the transaction cannot close until the
required shareholder approval is obtained. There can be no assurance
that the transaction will be completed as proposed or at all.

Investors are cautioned that, except as disclosed in the management
information circular to be prepared in connection with the transaction,
any information released or received with respect to the transaction may
not be accurate or complete and should not be relied upon. Trading in
the securities of a capital pool company should be considered highly
speculative.

Shares Outstanding: 6,752,160

-30-

Contact Information

  • FOR FURTHER INFORMATION PLEASE CONTACT:
    First One Capital Inc.
    Owen Menzel
    Chief Executive Officer
    (416) 919-5735
    or
    Red Media Corp.
    Roger Abbiss
    Chief Executive Officer
    (416) 593-5888 ext 226
    THE TSX VENTURE EXCHANGE INC. HAS IN NO WAY PASSED UPON THE MERITS OF
    THE PROPOSED TRANSACTION AND HAS NEITHER APPROVED NOR DISAPPROVED THE
    CONTENTS OF THIS PRESS RELEASE.