redCity Search Company Inc.
TSX VENTURE : RDC

redCity Search Company Inc.

January 02, 2007 09:00 ET

redCity Search Company Inc. to Seek Shareholder Approval to Proposed Share Consolidation and Name Change

TORONTO, ONTARIO--(CCNMatthews - Jan. 2, 2007) -

NOT FOR DISTRIBUTION IN THE UNITED STATES OR OVER UNITED STATES WIRE DISTRIBUTION SERVICES

REDCITY SEARCH COMPANY INC. (TSX VENTURE:RDC) ("redCity" or the "Company"), a local internet search engine company, announces that it intends to seek the approval of its shareholders to, among other things, a share consolidation (on the basis of one new common share for every five old common shares), a change of name to "ZipLocal Inc." and a reduction in its stated capital.

"Among our primary objectives for 2007 is the launch of a new brand and user interface that will unify all of our online properties under a single banner", stated Elaine Kunda, President and CEO of redCity. "An integral part of this objective is the incorporation of the newly-acquired 'Zip411' brands into the name of the Company to better reflect its business and operations. With a reinvigorated brand and enhance the user experience, and a more aggressive marketing strategy, we believe the Company will possess the tools necessary to capture a sizeable portion of the Canadian search market."

Currently, the Company has an aggregate of 260,457,662 common shares issued and outstanding. After giving effect to the consolidation, it expects to have an aggregate of 52,091,532 common shares issued and outstanding. It is intended that redCity's change of name will occur concurrently with the share consolidation. Management believes that the share consolidation is necessary to provide the Company with an outstanding share capital number that will better attract capital financing and that will provide future growth opportunities for shareholders on their investment. In addition, the Company intends to seek approval from its shareholders to effect a reduction in its stated capital by $12,701,947 in order to eliminate an accumulated deficit as at September 30, 2006 as a result of the activities of one of its predecessor corporations, Red Media Corp.

redCity will be asking its shareholders to approve, among other things, the share consolidation, name change and reduction in stated capital at an annual and special meeting of its shareholders scheduled to take place at 4:30 p.m. on Tuesday, January 30, 2007, at the offices of Wildeboer Dellelce LLP located at Suite 800, Wildeboer Dellelce Place, 365 Bay Street, Toronto, Ontario. A management information circular prepared in connection with the meeting has been mailed to the shareholders of redCity. The management information circular is available at the SEDAR website (www.sedar.com).

The board of directors of the Company has unanimously recommended that redCity's shareholders approve the share consolidation, name change and reduction in stated capital.

Completion of the share consolidation, the name change and reduction in stated capital is subject to shareholder approval and the share consolidation and name change are subject to acceptance by the TSX-Venture Exchange.

All currencies are stated in Canadian dollars.

This news release does not constitute an offer to sell or a solicitation of an offer to buy any of the securities in the United States. The securities have not been and will not be registered under the United States Securities Act of 1933, as amended or any state securities laws and may not be offered or sold within the United States or to U.S. Persons unless an exemption from such registration is available.

About redCity Search Company Inc.

redCity Search Company Inc. (www.redcitysearch.com) operates local search engines that allow users to find local businesses quickly and easily across Canada. Its search sites include www.Zip411.net, www.redToronto.com, www.redMississauga.ca and 411Canada.com.

The Company compiles and maintains an up to date database of over 1 million Canadian business establishments that attracts more than 1.4 million unique visitors per month. The Company also supplies branch locator services to the Desjardins Credit Union movement, Laurentian Bank of Canada, the Rona hardware chain and other multi branch Canadian business organizations.

FORWARD-LOOKING STATEMENTS

This news release may contain forward-looking statements based on management's current projections, beliefs and opinions at the date of this news release. Actual results could differ materially from those anticipated in the statements due to risks and uncertainties which affect the Company's business and operations. Reference should be made to the Company's continuous disclosure documents filed from time to time with Canadian securities regulatory authorities for a detailed description of such risks and uncertainties. The Company takes no responsibility to update forward-looking statements if circumstances or management's projections, beliefs or opinions change.

The TSX Venture Exchange does not accept responsibility for the adequacy or accuracy of this release.

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