Expecting Growth and Margin Impr

					 EARNINGS UPDATE                        December 21, 2010




                                                                               Pardeep S. Sangha, B.A. Sc., MBA
 IWEB GROUP INC.                                                               psangha@pifinancialcorp.com 604.718.7528
 (V-IWB) $0.97
                                                                               Sharon Wang, M.Sc. (Finance)
                                                                               swang@pifinancialcorp.com 604.664.2789
RATING: BUY                           TARGET: $1.25
(unchanged)                           (unchanged)
                                                                               Company Statistics
                                                                               Risk:                                                  SPECULATIVE
Expecting Growth and Margin                                                    52-week High / Low:                                     0.98 / 0.75
                                                                               Shares Outstanding:                                    28.4 M (basic)
Improvements in FY11                                                                                                                  31.3 M (fd)
                                                                               Market Capitalization:                                 30.4 M (fd)
   EVENT: iWeb achieved record revenues of $29M for FY10, representing         30-Day Avg. Daily Volume:                              6,299
   a 26 percent increase compared to the $23M revenues for FY09. EBITDA        Cash & Equivalents:                                    1.1 M
                                                                               Total Debt:                                            19.3 M
   was $7.8M or 27% of revenues, up from $5.5M (24% of revenues) in
                                                                               Insider Ownership:                                     67.4%
   FY09. The Company reported Net Loss of $28K or ($0.00) per share for
                                                                               CEO:                                                   Eric Chouinard
   the year compared to Net Income of 82K or $0.00 per share last year.        CFO:                                                   Philip Tousignant
                                                                               * All numbers are in US$ except share price and market cap
   iWeb has plenty of excess capacity to accommodate future growth.
   iWeb’s overall utilization rate is currently at 45% for co-location ser-    Financial Summary
   vices and 75% for dedicated/shared hosting. The new data center in          (FYE Sept.30)
                                                                                                                    FY08            FY09      FY10       FY11e
   LaSalle, QC (iWEB-NE), home to the new automated Smart Servers,
   has enough capacity to house 20,000 dedicated servers. In our mod-          Revenue ($M)       15.5                              23.1        29.0        36.0
   els, we do not anticipate iWeb needing additional datacenter capacity       Adj. EBITDA ($M)    3.8                               5.5         7.8        10.1
   for another 3 years.                                                        Net Income ($M)    (0.7)                              0.1       (0.0)         1.0
                                                                               EPS              (0.03)                              0.00      (0.00)        0.04
   IMPACT: POSITIVE. Management believes the Company can exceed                P/Sales                               1.9x            1.3x      1.0x        0.8x
   industry growth estimates of 15% per year. Management has indicated         EV/Sales                              2.9x           2.0x       1.6x        1.3x
   that the Company has a healthy pipeline of opportunities, churn has re-     EV/EBITDA                             N.M.           8.2x      5.9x         4.5x
   duced and demand for hosting services remains strong. The initial sales     P/E                                   N.M.           N.M.      N.M.        25.7x
   of Smart Servers have been going very well. The Company has more
                                                                               Quarterly (FY11)                        Q1e          Q2e         Q3e         Q4e
   than 700 smart servers in operation after only a couple of months. Mo-
   mentum is continuing in Q1 and management is expecting to ramp up           Revenue ($M)                         $8.10       $8.63         $9.25       $9.98
   its marketing efforts in the coming months.                                 EPS                                  $0.00       $0.00         $0.01       $0.02

                                                                                            900                                                                 $1.00
   FORECASTS: We have slightly modified our estimates and now we are                         800                                          200 day mvg
                                                                                                                                                                $0.95
                                                                                                                                         50 day mvg
   expecting iWeb’s revenues to increase 24% to $36M, with EBITDA of                        700
                                                                                                                                                                $0.90
   $10M, and Net Income of $1.0M or $0.04 per share (fd). We are also                       600
                                                                                                                                                                $0.85
                                                                                Thousands




                                                                                            500
   expecting margins to improve in FY11 as the majority of costs associ-                                                                                        $0.80
                                                                                            400
   ated with the new datacenter and development of new services are                         300
                                                                                                                                                                $0.75

   now complete.                                                                            200                                                                 $0.70

                                                                                            100                                                                 $0.65

   VALUATION/RECOMMENDATION: We believe iWeb is currently un-                               -
                                                                                                Dec-09   Feb-10   Apr-10   Jun-10    Aug-10   Sep-10   Nov-10
                                                                                                                                                                $0.60

   dervalued as it trades at 1.3x EV/Sales multiple and 4.5x EV/EBITDA
   multiple of our FY11 estimates. We are maintaining our BUY recom-           Corporate Information
   mendation on iWeb (V-IWB), and our 12-month target price of $1.25.
                                                                               iWeb is a provider of IT infrastructure and Internet
   Our $1.25 price target represents an EV/Sales ratio of 1.5x and an EV/      hosting services including dedicated servers, co-
   EBITDA ratio of 5.3x our FY11 estimates. We rate this investment with       location and web hosting. Founded in 1996, iWeb has
   a SPECULATIVE risk rating.                                                  four data centers in Montreal.


                                                                              A Disclosure fact sheet is available on Pages 7-8 of
                                                                              this report.
                                                                                          iWeb Group Inc. (V-IWB) – December 21, 2010




                 Quarter in Review
                   Financial Highlights for Q4FY10 (ending September 30, 2010)
                                              Q4FY10        Q4FY09           Q4FY10
                                               Actual     Prior Year      Consensus
                                               (US$)          (US$)         Est. (C$)
                 Revenue ($M)                       7.7           6.3             8.2
                 Adj. EBITDA ($M)                  1.8            1.0             2.0
                 Net Income ($K)                    56           432               64
                 EPS (fd $/share)                 0.00           0.01            0.00
                 Note: iWEB changed reporting to US dollars in Q4FY10

                 Source: IWeb Group Inc., ThomsonOne Analytics



                 iWeb achieved record revenues of $29M for fiscal 2010. Revenue in FY10 increased to $29M, from
                 $23M in FY09, a 26 percent increase over 12 months. EBITDA was $7.8M or 27% of revenues, up
                 from $5.5M (24% of revenues) in FY09. Cash flow generated from operations was $5.4M for the
                 year, similar to the $5.2M for the prior year.

                 Gross margins for the year were 40.1% compared to 46.2% in FY09. The decrease in gross mar-
                 gins is largely attributed to higher staff costs to support the growing services and operations. Total
                 operating expenses (including Selling expenses and Administrative expenses) increased to $9.8M
                 from 8.8M last year. However, as a percentage of revenue, total operating expenses decreased to
                 33.7% in FY10 from 38.1% in FY09.

                 iWeb reported solid revenue growth in Q4FY10. Revenues of $7.7M for Q4FY10 represented an
                 increase of 21% compared to $6.3M in Q4FY09, while iWeb reported Net Income of $56K or $0.00
                 per share for the quarter, compared to Net Income of $432K or $0.01 per share in Q4 last year. The
                 Company’s EBITDA improved to $1.8M from $1.0M a year ago. iWeb’s results were in line with
                 consensus estimates for revenues of C$8.2M and C$0.00 EPS.

                 Both Dedicated hosting and Colocation revenues are growing. The Company reported dedicated
                 hosting revenues of $6.5M during the quarter which was an increase of 21% from $5.4M last year.
                 Dedicated hosting accounted for 85% of the Company’s revenues in the quarter. Meanwhile, Co-
                 location revenues increased from $676K in Q4FY09 to $769K in Q4FY10. In October, the Company
                 launched the new automated services called Smart Servers for dedicated hosting. The initial sales
                 of Smart Servers have been going very well. The Company has more than 700 smart servers in op-
                 eration after only a couple of months.

                 Balance sheet could be improved. As at September 30, 2010, iWeb had cash of $1.1M, with 19.3M
                 of debt and a net negative cash position of ($18.2M), compared to a net negative cash position of
                 ($13.5M) a year ago. During the year, iWeb incurred $8.5M in total capital expenditures. Manage-
                 ment anticipates that cash generated from operations and the Company’s credit facilities will be
                 sufficient to fund operations for the foreseeable future. Management indicated they are currently
                 finalizing an additional financial facility.




2   |   UPDATE                                                         Pardeep S. Sangha, B.A. Sc., MBA | Sharon Wang, M.Sc. (Finance)
                                                                                                               iWeb Group Inc. (V-IWB) – December 21, 2010




                                        Outlook
                                        iWeb has gone through a significant “building phase” in the past two years and is now enter-
                                        ing into a “growth phase” with sufficient datacenter capacity and the launch of new automated
                                        service offerings. We believe iWeb’s future growth will be fueled by a recovery in IT spending, ad-
                                        ditional revenue from its new datacenter in Montreal, and the introduction of new services. We be-
                                        lieve iWeb has weathered through the recession and we will begin to witness significant revenue
                                        growth once again in the future. The overall economic environment is improving which will lead to
                                        increased IT spending benefiting iWeb.

                                        iWeb has plenty of excess capacity to accommodate growth. The Smart Server launch is closely
                                        tied to the construction of the Company’s new 31,000 square foot datacenter in LaSalle, QC (iWEB-
                                        NE) which was built from the ground up with automation in mind. This data center has enough ca-
                                        pacity to house 20,000 dedicated servers. In our models, we do not anticipate iWeb needing addi-
                                        tional datacenter capacity for another 3 years. iWeb’s overall utilization rate is currently at 45% for
                                        co-location services and 75% for dedicated/shared hosting.

                                        Management believes the Company can exceed industry growth estimates. Industry estimates are
                                        for the hosting market to grow at around 15% per year. Management has indicated that the Company
                                        has a healthy pipeline of opportunities, churn has reduced and demand for hosting services remains
                                        strong. Churn has decreased in Q4 to 3.2% versus 3.8% a year earlier and the Company expects
                                        this trend to continue. Momentum is continuing in Q1 and management is expecting to ramp up its
                                        marketing efforts in the coming months. iWeb will continue to primarily market the services through
                                        online advertising methods such as search engine optimization, Google Adwords, and banner ads.

                                        We are forecasting 24% revenue growth in FY11. We’ve slightly modified our estimates and now are
                                        expecting iWeb’s revenues to increase to $36M, with EBITDA of $10M, and Net Income of $1.0M
                                        or $0.04 per share (fd). We are also expecting margins to improve in FY11 as the majority of costs
                                        associated with the new datacenter and development of new services are now complete. We are
                                        expecting the Company’s gross margins to improve from 40.1% in FY10 to 43.9% in FY11; while
                                        experiencing gains in its EBITDA margins from 26.8% in FY10 to 28.0% in FY11.

                                          Estimates for FY11
                                                                      FY09            FY10             FY11 PI Estimate
                                                                     Actual          Actual     Old (in CDN$) New (in US$)
                                        Revenue ($M)                   23.1             29.0            35.4              36.0
                                        Gross Margin (%)             46.2%            40.1%           43.9%             43.9%
                                        EBITDA Margin (%)            24.0%            26.8%           28.2%             28.0%
                                        EBITDA ($M)                     5.5               7.8           10.0              10.1
                                        Net income ($M)                 0.1             (0.0)            1.3               1.0
                                        EPS (fd - $/share)            $0.00          ($0.00)           $0.04             $0.04
                                        Source: iWeb Group Inc., PI Financial Corp




Pardeep S. Sangha, B.A. Sc., MBA | Sharon Wang, M.Sc. (Finance)                                                                             UPDATE    |   3
                                                                                   iWeb Group Inc. (V-IWB) – December 21, 2010




                 Future Catalysts
                 There are several key catalysts which we believe can positively contribute to an increase in the Com-
                 pany’s share price. These include:

                      • Increased marketing of Smart Servers – We are expecting Smart Server sales to pickup as
                        the Company ramps up its marketing efforts.

                      • Profitability and margin improvement - We are expecting the Company to report improved
                        growth, and higher margins in the coming quarters. We expect the Company to be profitable
                        in FY11.

                      • Potential new acquisitions – We believe iWeb may acquire another smaller hosting provider
                        in Canada or the United States in the future.

                      • iWeb getting acquired – We believe that ultimately iWeb would be a prime target candidate
                        for a larger hosting provider. This industry has a history of acquisitions exceeding 10x EBITDA
                        multiples.

                      • TSX listing – we are expecting iWeb to move from the Venture Exchange to the main TSX
                        exchange in late 2011 or early 2012.



                 Valuation and Recommendation
                 iWeb is undervalued. iWeb is currently trading at an EV/Sales ratio of 1.3x our FY11 revenue esti-
                 mate and an EV/EBITDA ratio of 4.5x our FY11 EBITDA estimate. Despite showing better revenue
                 growth and EBITDA growth than its peer group, iWeb is valued at a discount to its hosting peer
                 group. Hosting companies are currently trading at an EV/Sales multiple of 2.6x FY11 and EV/EBITDA
                 multiple of 8.2x FY11.

                   Valuation Multiples
                                             FY11
                                   EV/Sales      EV/EBITDA
                 Peer Group              2.6x            8.2x
                 iWeb                    1.3x            4.5x
                 Source: PI Financial Corp., Bloomberg



                 We believe iWeb represents an attractive long-term investment opportunity for investors seek-
                 ing a high growth, small-cap technology company. Our investment recommendation is based on
                 the Company’s growth profile, improving margins in FY11, strong demand for datacenter hosting
                 services, and the potential to be acquired at a premium multiple.

                 We are maintaining our BUY recommendation and 12-month target price of $1.25 for iWeb (V-IWB).
                 We rate the investment with a SPECULATIVE risk given iWeb is a small cap technology company
                 with share price volatility and low trading volumes. Our target price represents a 1.5x EV/Sales mul-
                 tiple of FY11 Revenues and a 5.3x EV/EBITDA multiple of FY11 EBITDA. Our target price represents
                 a 29% share price appreciation from the Company’s recent closing.




4   |   UPDATE                                                  Pardeep S. Sangha, B.A. Sc., MBA | Sharon Wang, M.Sc. (Finance)
                                                                                                         iWeb Group Inc. (V-IWB) – December 21, 2010




  Income Statement (USD 000's)                       FY09         FY10        FY11e      Q1FY11     Q2FY11     Q3FY11     Q4FY11
  (Year End Sept 30)                                                                     Dec-10     Mar-11     Jun-11     Sep-11
                                                    Actual        Actual       Est.       Est.       Est.       Est.       Est.

  Revenue                                           23,070.0      28,976.5    35,954.5    8,100.5    8,627.0    9,248.2    9,978.8

  COS
   Network Delivery                                  9,623.6      13,324.2    14,949.9    3,426.1    3,632.4    3,810.8    4,080.6
   Amortization                                      2,790.7       4,032.3     5,204.1    1,207.4    1,267.8    1,331.2    1,397.7
  Gross Profit                                      10,655.8      11,620.0    15,800.5    3,467.0    3,726.9    4,106.2    4,500.4

  Operating Expenses
   Selling Expenses                                  3,806.0       4,512.4     5,448.2    1,292.5    1,348.1    1,387.2    1,420.5
   Administrative expenses                           4,976.6       5,250.8     6,132.4    1,507.3    1,513.3    1,545.1    1,566.7
  Total Operating Expenses                           8,782.6       9,763.3    11,580.6    2,799.8    2,861.4    2,932.2    2,987.2

  Income (Loss) from Operations                      1,873.2       1,856.7     4,220.0     667.2      865.5     1,173.9    1,513.3

  Financial expenses                                 2,164.7       2,740.2     2,876.4      648.0      690.2      739.9       798.3

  Earnings (loss) before income taxes                  321.8         29.9      1,343.6       19.2      175.3      434.1       715.0

  Net Income (loss) for the period                      82.0         (27.8)    1,048.0      15.0      136.8       338.6      557.7


  EPS
   EPS basic                                            0.00         (0.00)       0.04      0.00       0.00        0.01       0.02
   EPS diluted                                          0.00         (0.00)       0.04      0.00       0.00        0.01       0.02

  Adjusted EBITDA                                      5,547        7,764      10,077      2,036      2,296       2,674      3,071

  As Percentage of Revenue

  Revenue                                            100.0%        100.0%      100.0%     100.0%     100.0%      100.0%     100.0%

   COS - Network Delivery                              41.7%        46.0%       41.6%      42.3%      42.1%       41.2%      40.9%
  Gross Margin                                         46.2%        40.1%       43.9%      42.8%      43.2%       44.4%      45.1%

  Operating Expenses
   Selling Expenses                                    16.5%        15.6%       15.2%      16.0%      15.6%       15.0%      14.2%
   Administrative expenses                             21.6%        18.1%       17.1%      18.6%      17.5%       16.7%      15.7%
  Total Operating Expenses                             38.1%        33.7%       32.2%      34.6%      33.2%       31.7%      29.9%

  Income (Loss) from Operations                         8.1%          6.4%      11.7%       8.2%      10.0%       12.7%      15.2%
  Other Income (Expenses)                              -2.7%         -3.2%       0.0%       0.0%       0.0%        0.0%       0.0%

  Earnings (loss) before income taxes                   1.4%          0.1%       3.7%       0.2%       2.0%        4.7%       7.2%
  Income taxes                                          1.0%          0.2%       0.8%       0.1%       0.4%        1.0%       1.6%
  Net Income (loss) for the period                      0.4%         -0.1%       2.9%       0.2%       1.6%        3.7%       5.6%

  Adjusted EBITDA margin                               24.0%        26.8%       28.0%      25.1%      26.6%       28.9%      30.8%

  Year over Year Growth

   Revenue                                             49.1%         25.6%      24.1%       18.0%      20.9%      26.8%      29.8%
   Network Delivery                                    62.8%         38.5%      12.2%        7.7%      15.8%      12.1%      13.2%
   Gross Profit                                        38.7%          9.0%      36.0%       26.1%      23.5%      40.5%      46.1%
   Selling Expenses                                    39.1%         18.6%      20.7%       20.2%      22.3%      23.3%      17.4%
   Administrative expenses                             32.4%          5.5%      16.8%       40.0%      25.4%      22.2%      -8.0%
   Total Operating Expenses                            32.9%         11.2%      18.6%       27.7%      21.7%      20.0%       2.5%
   Income (Loss) from Operations                       74.1%         -0.9%     127.3%       19.7%      30.1%     144.8%     803.7%
   Earnings (loss) before income taxes                  NMF         -90.7%    4389.9%      -92.2%     -66.1%       NMF        NMF
   Net Income (loss) for the period                     NMF        -133.9%       NMF       -91.2%     -63.4%       NMF      897.0%
   Adjusted EBITDA                                     45.3%         40.0%      29.8%        4.6%      13.7%      34.5%      69.8%

  Sequential Quarterly Growth

   Revenue                                                                                             6.5%        7.2%       7.9%
   Network Delivery                                                                                    6.0%        4.9%       7.1%
   Gross Profit                                                                                        7.5%       10.2%       9.6%
   Selling Expenses                                                                                    4.3%        2.9%       2.4%
   Administrative expenses                                                                             0.4%        2.1%       1.4%
   Total Operating Expenses                                                                            2.2%        2.5%       1.9%
   Income (Loss) from Operations                                                                      29.7%       35.6%      28.9%
   Earnings (loss) before income taxes                                                               812.9%      147.6%      64.7%
   Net Income (loss) for the period                                                                  812.9%      147.6%      64.7%
   Adjusted EBITDA                                                                                    12.8%       16.5%      14.8%


Pardeep S. Sangha, B.A. Sc., MBA | Sharon Wang, M.Sc. (Finance)                                                                       UPDATE    |   5
                                                                                                             iWeb Group Inc. (V-IWB) – December 21, 2010




    Balance Sheet (USD 000's)                             FY09       FY10

                                                          Actual     Actual

    ASSETS
    Current Assets
     Cash and cash equivalents                             1,023.0    1,081.2
     Trade and other receivables                           1,664.8    2,653.6
     Foreign exchange contracts                              148.5       95.3
     Investment / Term Deposits                            1,000.0        -
     Other prepaid expenses                                  276.5      331.9
                                                           4,112.8    4,640.5

    Tangible assets                                       27,363.0   33,196.0
    Intangible assets                                      1,703.8    2,046.4
    Future income taxes                                       91.4       36.8
    Total Assets                                          33,271.0   40,278.8

    Liabilities
    Current Liabilities
     Trade and other accounts payable                      3,282.0    5,695.4
     Deferred revenues                                     4,255.6    4,467.4
     Instalments on long-term debt                         1,733.6    2,533.7
                                                           9,271.2   12,696.5

    Deferred revenues                                        978.6    1,174.0
    Other accounts payable                                   601.9      856.7
    Long-term debt                                        14,315.4   16,770.5
    Derivative embedded in subordinated debt                 841.4    1,505.5
    Future income taxes                                      622.1      551.3
    Total Liabilities                                     26,630.7   33,554.5

    Shareholder's Equity
     Share capital                                         5,178.9    5,075.8
     Contributed Surplus                                     943.8    1,173.0
     Retained earnings                                       517.5      324.4
    Total Shareholder's Equity                             6,640.3    6,724.4

    Liabilities + Shareholder's Equity                    33,271.0   40,278.8




    Valuation Metrics                                     FY09       FY10       FY11e

    Current Price                           $   0.97
     Current Market Cap - F.D. US$ (000's)    29,810
     Current Enterprise Value - US$ (000's)   45,500
     P/Sales                                                  1.3        1.0        0.8
     EV/Sales                                                 2.0        1.6        1.3
     EV / EBITDA (adj.)                                       8.2        5.9        4.5
     P/E (fd)                                                N.M.       N.M.       25.6

    Target Price (CDN$)                      $     1.25
     Target Market Cap - F.D. US$ (000's)        37,224
     Target Enterprise Value - US$ (000's)       52,914
     P/Sales                                                  1.6        1.3        1.0
     EV/Sales                                                 2.3        1.8        1.5
     EV / EBITDA (adj.)                                       9.5        6.8        5.3
     P/E (fd)                                                N.M.       N.M.       32.0

    Target Price Premium                           29%




6    |   UPDATE                                                                           Pardeep S. Sangha, B.A. Sc., MBA | Sharon Wang, M.Sc. (Finance)
                                                                                                                        iWeb Group Inc. (V-IWB) – December 21, 2010




Disclosure Fact Sheet
  Ratings                                                                             Price Volatility / Risk
BUY : recommendation: stock is expected to appreciate from its current                SPECULATIVE : The Company has no established operating revenue, and/or
price level at least 10-20% in the next 12 months.                                    balance sheet or cash flow concerns exist. Typically low public float or lack
NEUTRAL : recommendation: stock is expected to trade in a narrow range                of liquidity exists. Rated for risk tolerant investors only.
from its current price level in the next 12 months.                                   ABOVE AVERAGE : Revenue and earnings predictability may not be estab-
SELL : recommendation: stock is expected to decline from its current price            lished. Balance sheet or cash flow concerns may exist. Stock may exhibit
level at least 10-20% in the next 12 months.                                          low liquidity.
U/R : Under Review                                                                    AVERAGE : Average revenue and earnings predictability has been estab-
N/R : No Rating                                                                       lished; no significant cash flow/balance sheet concerns are foreseeable
Analyst recommendations and targets are based on the stock’s expected                 over the next 12 months. Reasonable liquidity exists. Price Volatility/Risk
return over a 12-month period or may be based on the company achiev-                  analysis while broad based includes the risks associated with a company’s
ing specific fundamental results. Under certain circumstances, and at the              balance sheet, variability of revenue or earnings, industry or sector risks,
discretion of the analyst, a recommendation may be applied for a shorter              and liquidity risk.
time period. The basis for the variability in the expected percentage change
for a recommendation, relates to the differences in the risk ratings applied
to individual stocks. For instance stocks that are rated Speculative must
be expected to appreciate at the high end of the range of 10-20% over a
12-month period.

  Analyst Certification

I, Pardeep S. Sangha, hereby certify that all of the views expressed in this report accurately reflect my personal views about the subject securities or issuers.
I also certify that no part of my compensation was, is, or will be, directly or indirectly related to the specific recommendations or views expressed in
this report. I am the research analyst primarily responsible for preparing this report.

  Research Disclosures

                                                                                                                                                       Applicability
1) PI Financial Corp. and its affiliates’ holdings in the subject company’s securities, in aggregate exceeds 1% of each company’s
   issued and outstanding securities.                                                                                                                     1) No
2) The analyst(s) responsible for the report or recommendation on the subject company, a member of the research analyst’s
   household, and associate of the research analyst, or any individual directly involved in the preparation of this report, have a
   financial interest in, or exercises investment discretion or control over, securities issued by the following companies.                                2) No
3) PI Financial Corp. and/or its affiliates have received compensation for investment banking services for the subject company
   over the preceding 12-month period.                                                                                                                    3) No
4) PI Financial Corp. and/or its affiliates expect to receive or intend to seek compensation for investment banking services
   from all companies under research coverage within the next 3 months.                                                                                   4) No
5) PI Financial Corp. and/or its affiliates have managed or co-managed a public offering of securities for the subject company in the past 12 months.      5) No
6) The following director(s), officer(s) or employee(s) of PI Financial Corp. is a director of the subject company in which PI provides
   research coverage.                                                                                                                                      6) No
7) A member of the research analyst’s household serves as an officer, director or advisory board member of the subject company.                             7) No
8) PI Financial Corp. and/or its affiliates makes a market in the securities of the subject company.                                                       8) No
9) Company has partially funded previous analyst visits to its projects.                                                                                   9) No
10) Additional disclosure:                                                                                                                                10) No

  General Disclosure

The affiliates of PI Financial Corp. are PI Financial (US) Corp., PI Financial Services Corp., and PI Capital Corp.
Analysts are compensated through a combined base salary and bonus payout system. The bonus payout is amongst other factors determined by rev-
enues generated directly or indirectly from various departments including Investment Banking. Evaluation is largely on an activity-based system that
includes some of the following criteria: reports generated, timeliness, performance of recommendations, knowledge of industry, quality of research and
investment guidance, client feedback. Analysts are not directly compensated for specific Investment Banking transactions.
None of the material, nor its content, nor any copy of it, may be altered in any way, transmitted to, copied or distributed to any other party, without the
prior express written permission of PI Financial Corp.
PI Financial Corp.’s policies and procedures regarding dissemination of research, and stock rating and target changes can be reviewed on our corporate
website at www.pifinancialcorp.com (Research: Research and Conflict Disclosure)


Pardeep S. Sangha, B.A. Sc., MBA | Sharon Wang, M.Sc. (Finance)                                                                                           UPDATE       |   7
                                                                                                                 iWeb Group Inc. (V-IWB) – December 21, 2010




The attached summarizes PI’s analysts review of the material operations of the attached company(s).

Analyst                      Company                              Type of Review                    Operations / Project                    Date
Pardeep S. Sangha            iWeb Group Inc.                      Management Meetings               Montreal QC                             07/10


    Disclosure to US Residents
PI Financial (US) Corp. is a U.S. registered broker-dealer and subsidiary of PI Financial Corp. PI Financial (US) Corp. accepts responsibility for the contents
of this research report, subject to the terms and limitations as set out above. U.S. residents seeking to effect a transaction in any security discussed
herein should contact PI Financial (US) Corp. directly.

Recommendations                                           Number of Recommendations                                                 Percentage

BUY                                                                    36                                                             92.11%
NEUTRAL                                                                  2                                                             5.13%
SELL                                                                     1                                                             2.56%
U/R                                                                      0                                                             0.00%
N/R                                                                      0                                                             0.00%

TOTAL                                                                  39



    Stock Rating and Target Changes
For reports that cover more than six subject companies, the reader is referred to our corporate web site for information regarding stock ratings and
target changes. www.pifinancialcorp.com (Research: Research and Conflict Disclosure)




                                                                                    iWeb Group (Initiated Coverage Aug 30/10)
    $1.40
                                                                                    Date            Rating Change        Target Change             Share Price
    $1.20                                                                           Aug 30/10       Buy                  $1.25                     $0.80

    $1.00

    $0.80

    $0.60

    $0.40

    $0.20

    $0.00
    Se 8




    Se 9




    Se 0
            8




            9




            0
    M 7




    De 8

    M 8




    De 9

    M 9




    De 0
         10
        -0




        -0




        -1
          0




          0




          1
          0




          0




          1
         0




         0




         0
       n-




       n-




       n-
       c-




      p-

       c-




      p-

       c-




      p-

       c-
     ar




     ar




     ar
    Ju




    Ju




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    De




8    |   UPDATE                                                                             Pardeep S. Sangha, B.A. Sc., MBA | Sharon Wang, M.Sc. (Finance)
Capital Markets Group

Bert Quattrociocchi, BA, CFA
Executive Vice President, Head of Capital Markets
604.664.2925


Research Analysts                                                      Institutional Sales                                            Investment Banking
Consumer Products & Special Situations                                 Head of Institutional Sales                                    Vancouver
Sheila Broughton, MBA, CFA                                             Jim Danis, B.Sc. (Hons.)                                       Blake Corbet, BA
604.664.2695                                                           604.718.7551                                                   604.664.2967
                                                                                                                                      Jim Mustard, B.A.Sc., P Eng
                                                                                                                                                             .
Oil & Gas                                                              Priya Patil, B.Sc., LL.B.                                      604.664.3655
Alistair Toward, B.Comm, CFA                                           416.883.9044
403.543.2824                                                                                                                          Carol Ellis, MBA, P.Geo
                                                                       Denton Creighton, BA, MBA                                      604.664.3606
Energy Services                                                        416.883.9043
                                                                                                                                      Leo Wilson, CA
Roy Ma, B.Comm, CFA                                                    David Goguen, CFA                                              604.718.7510
403.543.2823                                                           604.664.2963
                                                                       Jeremiah Katz                                                  Toronto
Special Situations
                                                                       604.664.2816
                                                                                                                                      Dean McPherson, B.Sc, MBA
Jason Zandberg, B.B.A, CFA
                                                                                                                                      647.789.2405
604.718.7541                                                           Ian Mellon, BA
                                                                       416.883.9045
                                                                                                                                      Bill Murray, B.Sc., MBA, CFA
Technology                                                                                                                            416.883.9049
Pardeep S. Sangha, B.A.Sc., MBA                                        Doug Melton, FCSI
604.718.7528                                                           604.718.7532                                                   Calgary
                                                                       Tim O’Neill                                                    Arthur Kwan, MBA, CFA
Transportation & Industrial Products                                   604.718.7514                                                   403.543.2918
Chris Murray, P.Eng, MBA
416.883.9047
                                                                                                                                      Assistant
                                                                       Institutional Trading                                          Kinga Gadomska
Research Associates                                                                                                                   604.664.3604
                                                                       Melanie Grant, B.Sc.
Victoria Chan, CFA
                                                                       604.718.7535 or 888.525.8811
604.718.7534
                                                                       Donna McGuigan
Chris LeGrow, B.Comm
                                                                       416.883.9042 or 888.525.8811
403.543.2822
                                                                       Darren Ricci
David Seymour, M.Sc., MBA
                                                                       604.664.2998 or 800.667.6124 (US) or
403.543.2828
                                                                       877.682.7233 (CDN)
Sharon Wang, M.Sc. (Finance)
                                                                       Joe Tibble
604.664.2789
                                                                       604.718.7525 or 888.525.8811
                                                                       Adam Dell, B.Comm
Marketing and Publishing                                               604.718.7517 or 888.525.8811
Michelle Kwok
604.664.2724
Tanya Rosenbrock
604.664.2707




PI Financial Corp.                              www.pifinancialcorp.com

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