UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

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INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities
Exchange Act of 1934 (Amendment

Filed by the Registrant S
Filed by a Party other than the Registrant ¨
Check the appropriate box:
¨   Preliminary Proxy Statement
¨   Confidential, for Use of  the Commission Only (as permitted by Rule 14a-6(6)(2))
þ   Definitive Proxy Statement
¨   Definitive Additional Materials
¨   Soliciting Material Under Rule 14a-12
 FIRSTWAVE TECHNOLOGIES,  INC. 
(Name of Registrant as Specified in its Charter)

(Name of Person(s) Filing Proxy Statement, if Other Than the Registrant)
Payment of Filing Fee (Check the appropriate box):
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¨ Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
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       (2)    Aggregate number of class of securities to which transaction applies:
       (3)    Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11
                (set forth the amount on which the filing fee is calculated and state how it was determined):
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                (1)      Amount previously paid:   
                (2)      Form, Schedule or Registration Statement No.          )

Filed by the Registrantý

Filed by a Party other than the Registranto

Check the appropriate box:
oPreliminary Proxy Statement
oConfidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
ýDefinitive Proxy Statement
oDefinitive Additional Materials
oSoliciting Material Pursuant to §240.14a-12

Firstwave Technologies, Inc.
(Name of Registrant as Specified In Its Charter)

(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
ýNo fee required
oFee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11
(1)Title of each class of securities to which transaction applies:
(2)Aggregate number of securities to which transaction applies:
(3)Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing fee is calculated and state how it was determined):
(4)Proposed maximum aggregate value of transaction:
(5)Total fee paid:
oFee paid previously with preliminary materials.
oCheck box if any part of the fee is offset as provided by Exchange Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid previously. Identify the previous filing by registration statement number, or the Form or Schedule and the date of its filing.
(1)Amount Previously Paid:
(2)Form, Schedule or Registration Statement No.:
(3)Filing Party:
(4)Date Filed:
:
                (3)      Filing Party:
                (4)      Date Filed: 

Firstwave Technologies, Inc.
5775 Glenridge Drive
Suite 1000
2859 Paces Ferry Road
E400
Atlanta, Georgia 3033930328

April 1, 2003

March 29, 2006
Dear Shareholder:

You are cordially invited to attend the Annual Meeting of Shareholders of Firstwave Technologies, Inc. (the "Company"“Company”), which will be held at 2:00 P.M. on May 1, 2003June 5, 2006 at the Company'sCompany’s corporate offices located at 2859 Paces Ferry Road,5775 Glenridge Drive, Suite 1000,E400, Atlanta, Georgia 30339.

30328 (the “Annual Meeting”).

The principal business of the meetingAnnual Meeting will be to (i) amend the Amended and Restated Articles of Incorporation to remove a “super majority” voting provision, (ii) elect fivethree directors to the Company’s Board of Directors, each to serve a one-year term, or until his successor is elected and qualified, (iii) ratify the next annual meeting, (ii) to presentappointment of Cherry, Bekaert & Holland, L.L.P. as the Company’s independent public accountants for shareholder approval an amendment to the Company's 1993 Stock Option Plan to increase the number of shares reserved for future grants under the plan from 516,667 to 816,667 year ending December 31, 2006,and (iii) to(iv) transact such other business as may properly come before the meeting. DuringAfter the meeting,formal portions of the Annual Meeting, we will review the results of the past year and report on significantother aspects of our operations for 2003.

operations. 


Your vote is important.important. Whether or not you plan to attend the Annual Meeting, please take the time to complete, sign, date, and return the enclosed proxy card in the postage-prepaid envelope provided so that your shares will be voted at the meeting. Alternatively, if you need assistance voting your shares, you may email, firstwave.info@morrowco.com, or call Morrow & Co., Inc. at 800-607-0088, who will be soliciting your votes after you have reviewed this proxy. If you decide to attend the meeting, you may, of course, revoke your proxy and personally cast your vote.

 
 Sincerely yours,

 
 

/s/
Richard T. Brock

 

Richard T. Brock
PresidentChairman and Chief Executive Officer


Firstwave Technologies, Inc.
5775 Glenridge Drive
Suite 1000
2859 Paces Ferry Road
E400
Atlanta, Georgia 3033930328

NOTICE OF ANNUAL MEETING OF SHAREHOLDERS

The Annual Meeting of Shareholders of Firstwave Technologies, Inc. (the "Company"“Company”) will be held at 2:00 P.M. on May 1, 2003,June 5, 2006 at the Company'sCompany’s corporate offices located at 2859 Paces Ferry Road,5775 Glenridge Drive, Suite 1000,E400, Atlanta, Georgia 30339.30328 (the “Annual Meeting”). The meetingAnnual Meeting is called for the following purposes:

        (1)  To amend the Amended and Restated Articles of Incorporation to remove the“super majority” vote requirement to approve a change of control transaction;

        (2)  To elect three directors to the Company’s Board of Directors, each to serve a one-year term, or until his successor is elected and qualified;

(2)
To present for shareholder approval an amendment to the Company's 1993 Stock Option Plan to increase the number of shares reserved for future grants under the plan from 516,667 to 816,667;
        (3)  To ratify the appointment of Cherry, Bekaert & Holland, L.L.P. as the Company’s independent public accountants for the year ending December 31, 2006; and

        (4)  To transact such other business as may properly come before the Annual Meeting.

(3)
To transact such other business as may properly come before the meeting.

The Board of Directors has fixed the close of business on March 18, 2003,27, 2006 as the record dateRecord Date for the purpose of determining the shareholders who are entitled to notice of and to vote at the meetingAnnual Meeting and any adjournment or postponement thereof.


The officers and directors of the Company cordially invite you to attend the meeting.Annual Meeting. To ensure your representation at the meeting,Annual Meeting, you are urged to mark, date, sign and return the enclosed proxy card as promptly as possible in the postage-prepaid envelope enclosed for that purpose. Alternatively, if you need assistance voting your shares, you may email, firstwave.info@morrowco.com, or call Morrow & Co., Inc. at 800-607-0088, who will be soliciting your votes after you have reviewed this proxy. YOU MAY REVOKE YOUR PROXY IN THE MANNER DESCRIBED IN THE ACCOMPANYING PROXY STATEMENT AT ANY TIME BEFORE IT HAS BEEN VOTED AT THE ANNUAL MEETING. ANY SHAREHOLDER ATTENDING THE ANNUAL MEETING MAY VOTE IN PERSON EVEN IF HE OR SHE HAS RETURNED A PROXY.

PROXY CARD.
 By order of the Company'sCompany’s Board of Directors,

 
 

/s/
Richard T. Brock

 

Richard T. Brock
PresidentChairman and Chief Executive Officer

April 1, 2003
March 29, 2006

Atlanta, Georgia

WHETHER OR NOT YOU PLAN TO ATTEND THE ANNUAL MEETING, WE REQUEST YOU COMPLETE, SIGN, DATE, AND RETURN THE ENCLOSED PROXY CARDSO THAT YOUR SHARES WILL BE REPRESENTED.

Firstwave Technologies, Inc.
Suite 1000
2859 Paces Ferry Road
Atlanta, Georgia 30339


PROXY STATEMENT

VOTING INFORMATION
This Proxy Statement is furnished by and on behalf of the Board of Directors of Firstwave Technologies, Inc. (the "Company"“Company”) in connection with the Company’s solicitation of proxies for use at the Annual Meeting of Shareholders of the Company to be held at 2:00 P.M. on May 1, 2003,June 5, 2006 at the Company'sCompany’s corporate offices located at 2859 Paces Ferry Road,5775 Glenridge Drive, Suite 1000,E400, Atlanta, Georgia 30339,30328, and at any adjournments or postponements thereof (the "Annual Meeting"“Annual Meeting”). This Proxy Statement and the enclosed proxy card will be first mailed on or about April 1, 2003March 29, 2006 to the Company'sCompany’s shareholders of record on March 18, 200327, 2006 (the "Record Date"“Record Date”).

, who are the shareholders entitled to receive notice of, and to vote upon matters presented at the Annual Meeting.

THE COMPANY'SCOMPANY’S BOARD OF DIRECTORS URGES YOU TO COMPLETE, SIGN, DATE, AND RETURN THE ENCLOSED PROXY CARD IN THE POSTAGE PREPAID ENVELOPE PROVIDED.


Alternatively, if you need assistance voting your shares, you may email, firstwave.info@morrowco.com, or call Morrow & Co., Inc. at 800-607-0088, who will be soliciting your votes after you have reviewed this Proxy Statement.

SHARES ENTITLED TO VOTE AND RELATED MATTERS
Q:
What am I voting on?
A:You are being asked to vote on two proposals: You will be asked to:

Q:
What am I voting on?

A:
You are being asked to vote on two proposals:

Proposal 2 - elect three directors to the Company’s Board of Directors, each to serve a one-year term, or until the next annual meeting and until their successors arehis or her successor is elected and qualified. Threequalified; and

Proposal 3 - ratify the appointment of Cherry, Bekaert & Holland, L.L.P. as the five directors who have been nominated are incumbent directors from 2002.

Proposal 2—Company’s independent public accountants for the approval of an amendment to our 1993 Stock Option Plan to increase the number of shares reserved for future grants under the plan from 516,667 to 816,667.year ending December 31, 2006.


You are also being asked to give the proxiesindividuals named on the proxy card your proxythe right to vote your shares on any other business that might properly comingcome before the meeting.

Q:
Annual Meeting.

Q:
Who is entitled to vote?
A:Holders of record of our common stock and holders of our Series A Convertible Preferred Stock, Series B Convertible Preferred Stock, Series C Convertible Preferred Stock and Series D Convertible Preferred Stock, each on an as-if-converted basis, as of the close of business on March 27, 2006, the Record Date, are entitled to vote on the matters listed on the proxy card to be voted on at the Annual Meeting.

Q:
How many shares can be voted?
A:At the Record Date of March 27, 2006, shareholders were entitled to cast approximately 3,666,781 votes at the Annual Meeting, as set forth in the table below. Each share of common stock entitles the holder to one vote for each matter to be voted upon at the Annual Meeting. The holders of our preferred stock generally vote on an as-if-converted basis together with the holders of our common stock and are entitled to cast one vote for each share of common stock into which the preferred stock is convertible for each matter to be voted upon at the Annual Meeting. The Company does not have cumulative voting.
  Shares Outstanding  Votes Entitled 
Class As of Date of Record  to be Cast 
       
Common Stock  2,768,302  2,768,302 
Series A Preferred  10,000  161,812 
Series B Preferred  7,020  86,667 
Series C Preferred  10,000  416,667 
Series D Preferred  7,000  233,333 
Total Votes Entitled to be Cast  2,802,322  3,666,781 
2
Q:    
How do I vote?
A:
Complete, sign and return your proxy card to the Company’s transfer agent, American Stock Transfer& Trust Company, Attn: Joe Wolf, 59 Maiden Lane, New York, NY 10038 by mail, fax to American Stock Transfer Attn: Joe Wolf at 718-921-8116, or email to jwolf@amstock.com. If you return your signed proxy card but do not indicate how you wish to vote, your shares will be voted FOR the proposals described in this Proxy Statement. You may also attend the meeting in person and vote. However, even if you plan to attend the Annual Meeting, we ask that you sign and return a proxy card. Alternatively, if you need assistance voting your shares, you may email, firstwave.info@morrowco.com, or call Morrow & Co., Inc. at 800-607-0088, who will be soliciting your votes after you have reviewed this proxy. If you then attend the Annual Meeting, you may cast your vote in person, which will automatically revoke your proxy. If your shares are held beneficially through a broker, financial institution or other holder of record and you wish to vote your shares in person at the Annual Meeting, you must present a letter from the holder of record confirming your ownership of the shares you intend to vote as of March 27, 2006. If your shares are held beneficially, but you do not intend to vote your shares in person at the Annual Meeting, you should complete and return any proxy materials sent to you by the holder of a record so your shares may be voted by the holder of record in accordance with your wishes.

Q:
What if I change my mind after I return my proxy?
A:You may revoke your proxy and change your vote at any time before the Annual Meeting. You may do this by signing and sending to the Company’s Corporate Secretary, Richard T. Brock, 5775 Glenridge Drive, Suite E400, Atlanta, Georgia 30328, a written dated document stating that the proxy is revoked or by sending to the Company another proxy with a later date than the one you want to revoke, or by voting in person at the Annual Meeting.

Q:
Who will count the votes?
A:The Chairman of the Board of Directors will select an inspector(s) of the election for our Annual Meeting. The inspector(s) will ascertain the number of shares outstanding and the voting power of the shares, determine the shares represented at the Annual Meeting to determine whether or not a quorum is represented, determine the validity of proxies and ballots, count all votes and determine the results of the voting. The inspector(s) will deliver a written report after the Annual Meeting.

Q:
What constitutes a quorum?
A:
There must be a quorum for the Annual Meeting to be held. A quorum is a majority of the voting power of the outstanding shares on the Record Date. To have shares counted towards the quorum, shareholders with thepower to vote the Company’s shares may be present at the Annual Meeting or represented by proxy. If you submit a properly executed proxy card, even if you abstain from voting, then you will be considered present for determining whether or not a quorum is represented.

Q:
How are abstentions and broker non-votes treated?
A:Broker non-votes, or proxies submitted by brokers as holders of record on behalf of their customers to abstain or that do not indicate how to vote on a proposal, are counted toward the shares represented for purposes of a quorum. However, broker non-votes and abstentions are not counted in the tally of votes FOR or AGAINST the proposal. As a result, broker non-votes and abstentions will have no effect on the proposal except to the extent they assist in constituting a quorum.
Q:    
What happens if the Annual Meeting is postponed or adjourned?
A:The persons named as proxies may propose one or more adjournments or postponements of the Annual Meeting for any reason, including to permit the further solicitation of proxies. Any adjournment or postponement would require the affirmative vote by the holders of a majority of the voting shares represented at the Annual Meeting. If any subsequent reconvening of the meeting is held within 11 months of the original Annual Meeting date, all proxies received by the Company will be voted in the same manner as they would have been voted at the original meeting. However, as described above, you may revoke your proxy and change your vote at any time before the reconvened meeting.

Q:
How many votes are required to approve the proposals?
A:The proposals will be deemed approved by the shareholders as follows:
3
Proposal 1 - Amendment to the Amended and Restated Articles of Incorporation requires the affirmative vote of two-thirds of all of the votes entitled to vote?be cast.

Proposal 2

A:
Holders of our common stock, our Series A Convertible Preferred Stock, our Series B Convertible Preferred Stock, and our Series C Convertible Preferred Stock as of the close of business on March 18, 2003, the record date, are entitled to vote.

Q:
How many shares can be voted?

A:
As of the record date, shareholders were entitled to cast approximately 3,292,771 votes at the annual meeting, as set forth in the table below. Each shareholder of common stock is entitled to one vote for each share held. The holders of our preferred stock generally vote together with the holders of our common stock and are entitled to cast one vote for each share of common stock into which the preferred stock is convertible.

Class
 Shares Outstanding
March 18, 2003
 Votes Entitled
to be Cast
Common Stock 2,627,625 2,627,625
Series A Preferred 10,000 161,812
Series B Preferred 7,020 86,667
Series C Preferred 10,000 416,667
  
 
 Total Votes Entitled to be Cast 2,654,645 3,292,771

1

Q:
How do I vote?

A:
Complete, sign and mail us your proxy card. If you return your signed proxy card but do not indicate how you wish to vote, your shares will be voted FOR each of the proposals described in this Proxy Statement. You may, of course, attend the meeting in person and vote. However, even if you plan to attend the meeting, we ask that you sign and return a proxy card.

Q:
What if I change my mind after I return my proxy?

A:
You may revoke your proxy and change your vote at any time before the meeting. You may do this by signing and sending a written notice of revocation or another proxy with a later date than the one you want to revoke, or by voting in person at the meeting.

Q:
Who will count the votes?

A:
The chairman of the board of directors will select the inspectors of the election for our annual meeting. The inspectors will ascertain the number of shares outstanding and the voting power of the shares, determine the shares represented at the meeting, determine the validity of proxies and ballots, count all votes and determine the results of the voting. The inspectors will deliver a written report after the meeting.

Q:
What constitutes a quorum?

A:
There must be a quorum for the meeting to be held. A quorum is a majority of the voting power of the outstanding shares. To be counted towards the quorum, shareholders may be present at the meeting or represented by proxy. If you submit a properly executed proxy card, even if you abstain from voting, then you will be considered part of the quorum. Broker non-votes, or proxies submitted by brokers as holders of record on behalf of their customers that do not indicate how to vote on the proposal, are also considered part of the quorum. However, Broker non-votes and abstentions are not counted in the tally of votes FOR or AGAINST the proposal. As a result, Broker non-votes and abstentions will have no effect on the two proposals except to the extent they assist in constituting a quorum.

Q:
What happens if the annual meeting is postponed or adjourned?

A:
If the annual meeting is postponed or adjourned for any reason, including to permit the further solicitation of proxies, at any subsequent reconvening of the meeting all proxies will be voted in the same manner as they would have been voted at the original meeting. However, as described above, you may revoke your proxy and change your vote at any time before the reconvened meeting.

Q:
How many votes are required to approve each proposal?

A:
Each proposal will be deemed approved by the shareholders as follows:
Proposal 3 - Ratification of the appointment of Cherry, Bekaert & Holland, L.L.P. as the Company’s independent public accountants requires an affirmative vote from the holders of shares representing a majority of the votes duly cast on this proposal.

Q:
Who is paying for this proxy solicitation?
A:We are paying the cost of soliciting proxies. In addition to mailing these materials, our officers, directors and employees will solicit proxies, either personally or by telephone or facsimile. They will not be paid specifically for this solicitation activity, but may be reimbursed for out-of-pocket expenses incurred in connection with the solicitation.

We also intend to reimburse brokers, financial institutions, custodians, nominees and fiduciaries who are holders of record of Company shares for their reasonable expenses in forwarding these materials to the beneficial owners of those shares. Furthermore, we will engage Morrow & Co., Inc., of 470 West Avenue, Stamford, CT 06902, www.morrowco.com, a firm to help solicit proxies. The proxy solicitor will be contacting those shareholders who have not returned proxy cards by a reminder mailing and by telephone calls. The anticipated cost is estimated at $15,000. The extent to which we and our proxy solicitation firm must solicit proxies depends entirely upon how soon proxy cards are returned. Please send in your proxy cards immediately.

Q:
Where can I find more information about Firstwave?
A:
We are subject to the information requirements of the Securities Exchange Act of 1934, as amended, and are required to file reports, proxy statements and other information with the Securities and Exchange Commission. You may inspect and copy our reports, proxy statements and other publicly available information at the Public Reference Section of the Securities and Exchange Commission, 450 Fifth Street, N.W. Washington, D.C. 20549 at the prescribed rates. The Commission maintains a website on the internet at http://www.sec.gov that contains reports, proxies, information statements, and registration statements and other information filed with the Commission through the EDGAR system. Our common stock is traded on the NASDAQ SmallCap Market (Symbol: FSTW), and our reports, proxy statements and other information can also be inspected at the offices of NASDAQ Operations, 1735 K Street, NW Washington, D.C. 20006.
Proposal 2PROPOSAL 1 - APPROVE THE AMENDMENT TO THE AMENDED AND RESTATED
—ARTICLES OF INCORPORATION
The Option Plan amendment willCompany’s Amended and Restated Articles of Incorporation require the approval of the holders of shares representing two thirds of the votes entitled to be cast in order to take the following actions:

-amend the Articles of Incorporation of the Company;

-consolidate the Company with one or more corporations to form a new consolidated corporation;

-merge the Company into another corporation or merge one or more other corporations into the Company;

-sale, lease, exchange or transfer all, or substantially all, of the property and assets of the Company, including its goodwill;

-voluntarily or involuntarily liquidate, dissolve or wind up the Company; or

-engage in any other transaction that Section 14-23-1110 of the Georgia Business Corporation Code defines as a “Business Combination”.
4
The proposed Amendment to the Amended and Restated Articles of Incorporation (the “Amendment”), attached to this Proxy Statement as Exhibit A, deletes the “super majority” voting requirement to approve change of control transactions. If the Amendment is approved, if a majority of the voting powervotes entitled to be cast will be required to approve a change of control transaction. The proposed Amendment will reduce the burden on the Company to engage in potentially desired transactions. In addition, because shares of the Company’s stock are widely held, the Company believes that the Amendment does not decrease the protections against unwanted takeovers and change of control transactions.

Required Vote
The affirmative vote of the holders of shares representing two-thirds of the votes entitled to be cast is required to approve Proposal 1.

THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS
VOTE IN FAVOR OF THE AMENDMENT TO THE AMENDED AND
RESTATED ARTICLES OF INCORPORATION

PROPOSAL 2 - ELECTION OF DIRECTORS

Current Board Structure
On July 31, 2003, in accordance with Section VI of the Company’s Amended and Restated Articles of Incorporation, the Board of Directors divided the Board into three classes (designated as Class I, Class II and Class III), with each class serving staggered three-year terms ending in successive years. On May 6, 2005, the Board of Directors set the number of directors to four members, all shares present,to serve one-year terms after completing their respective current lengths of service.

The Board of Directors currently has four members, Richard T. Brock, Roger A. Babb, I. Sigmund Mosley, and John N. Spencer, Jr. The Chairman of the Board is Mr. Brock. Mr. Babb serves as Lead Director and has since May 2003. The Lead Director is an independent director who presides over regularly scheduled meetings of independent directors which take place at least four times per year, chairs Board meetings when the Chairman of the Board is not in person orattendance, and performs other functions as directed by proxy,the Board. The current Board members and votedtheir classification and term expiration are shown below.  
Current
Current Position
Class
Length of service
Directors
Age
term expires
w/Company
initial term one year serviceI. Sigmund Mosley, Jr.60May 2006Member, Audit Committee; Chair, Member, Compensation Committee; Member, Corporate Governance and Nominating Committee
Class Ithree year serviceJohn N. Spencer, Jr.65May 2007Chair and Financial Expert, Audit Committee; Member, Compensation Committee; Member, Corporate Governance and Nominating Committee
Class IIIone year serviceRoger A. Babb58May 2006Lead Director; Member, Audit Committee; Member, Compensation Committee; Chair, Corporate Governance and Nominating Committee
Class IIIone year serviceRichard T. Brock59May 2006Chairman of the Board; Director

5
JOHN N. SPENCER, JR.
Age: 65
Mr. Spencer, a Certified Public Accountant, has been a director since November 2003. He retired as audit partner from Ernst & Young in 2000 after 38 years of serving a broad range of clients. Mr. Spencer served as coordinating partner on clients, both large and small, principally in the life sciences, healthcare, manufacturing and technology industries. He has significant expertise in coordinating services to publicly held companies, including involvement in more than 200 registration statements and over 25 initial public offerings. Since 2000, Mr. Spencer has been self employed as a consultant. He served as president and a director of the Business and Technology Alliance (“B&TA”). He was a co founder and is treasurer of the Atlanta Venture Forum. In addition, he is a co founder of the Technology Hall of Fame of Georgia. Mr. Spencer is a member of the National Association of Corporate Directors, and he serves as a member of the Board of Directors of A C Therapeutics, Inc., GeneEx, Inc, OrthoHelix Surgical Designs, Inc.. and the Georgia Biomedical Partnership, Inc. He holds a BS from Syracuse University, and he earned an MBA from Babson College. He also completed the Harvard Business School’s Advanced Management Program.

Nominees

The terms of the Class III directors, Messrs. Brock and Babb, expire with this Annual Meeting. The term of Mr. Mosley, elected in 2005 to the Board, also expires with this Annual Meeting. Mr. Spencer is a Class I director whose term will expire at the Annual Meeting vote FORin 2007. There are no remaining Class II directors.
Messrs. Brock, Babb, and Mosley have been recommended for nomination by the proposal.

Q:
WhoCompany’s Corporate Governance and Nominating Committee and recommended for election by the Company’s Board of Directors. If any nominee is paying for this proxy solicitation?

A:
We are paying the cost of soliciting proxies. In additionunable to mailing these materials, our officers, directors and employees will solicit proxies, either personallyserve as a director or via telephone or facsimile. They will not be paid specifically for this solicitation activity.

2

Q:
Where can I find more information about Firstwave?

A:
We are subject to the information requirementsdirector, regardless of the Exchange Actreason, the proxies directing a vote for such nominee shall be voted for the substitute nominee proposed by the Corporate Governance & Nominating Committee and are required to file reports, proxy statements and other information with the Securities and Exchange Commission. You may inspect and copy our reports, proxy statements and other information at the Public Reference Section of the Commission at Room 1024, 450 Fifth Street, N.W. Washington, D.C. 20549, and at the Commission's regional offices at Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661 and 7 World Trade Center, Suite 1300, New York, New York 10048. You may also obtain copies of the reports, proxy statements and other information from the Public Reference Section of the Commission, Washington, D.C. 20549 at prescribed rates. The Commission maintains a world wide web site on the internet athttp://www.sec.gov that contains reports, proxies, information statements, and registration statements and other information filed with the Commission through the EDGAR system. Our common stock is traded on the Nasdaq SmallCap Market (Symbol: FSTW), and our reports, proxy statements and other information can also be inspected at the offices of Nasdaq Operations, 1735 K Street, NW Washington, D.C. 20006.


PROPOSAL 1—ELECTION OF DIRECTORS

        The Board of Directors of the Company presently consists of five members. The current terms of all existing directors expire upon the election and qualification of the directors to be selected at this Annual Meeting. James R. Porter, who has served on the Board of Directors since the Company's initial public offering in March of 1993, has decided not to seek reelection to the Board. The Board of Directors has nominated Roger A. Babb, Richard T. Brock, Richard D. Jackson, John F. Keane and Alan I. Rothenberg for election torecommended by the Board of Directors, at the Annual Meeting. Each member is to serve until the 2004 Annual Meeting of Shareholders and until their successors are duly elected and qualified.

        All Shares represented by properly executed proxies received in response to this solicitation and not revoked before they are exercised will be voted in the manner specified therein by the shareholders. If no specification is made, the proxy will be votedFOR the electiondiscretion of the nominees listed in this Proxy Statement to the Boardholder of Directors. Eachsuch proxies. The Company is not aware of any nominee has consentedwho is unable or unwilling to serve as a director.


Listed below are the nominees for election as directors with background information.

RICHARD T. BROCK
Age: 58
Richard Brock currently serves as the Company’s Chairman of the Board and Chief Executive Officer and has been a director since the Company’s inception in October 1984. He is the founder of the Company if elected. If atand served as the timeCompany’s Chief Executive Officer from October 1984 until November 1992, and also from November 1994 until December 1996. Mr. Brock is the founder of the Annual Meeting any nominee is unable or declinesBrock Capital Partners, a capital investment firm. Prior to serve as a director, the discretionary authority provided in the enclosed proxy card will be exercised to vote for a substitute candidate designated by the Board of Directors, but in no event will the proxy be voted for more than five nominees. The Board of Directors has no reason to believe that any of its nominees will be unable or will decline to serve as a director.

        Shareholders may withhold their votes from the entire slate of nominees by so indicating in the space provided on the enclosed proxy card. Shareholders may withhold their votes from any particular nominee by writing that nominee's name in the space provided for that purpose on the enclosed proxy card.

        Set forth below is certain information furnished tofounding the Company, by each nominee.

3

Mr. Brock founded and served as Chief Executive Officer of Management Control Systems, Inc. Mr. Brock received a BS from Spring Hill College, an MBA from Louisiana State University, and is a Certified Public Accountant.


Director Nominee Biographical Information

ROGER A. BABB

Age: 56

59

 Mr. Babb has been a director of the Company since March 1999. He is President and founder of Operation Simulation Associates, Inc., a software company developing power system simulation software and providing consulting services to the electric power industry. He is also Chief Executive Officer of Babb International and a director of Babb Lumber Company, Inc.; both are, a building material manufacturing companies.company. He was President of Babb International, which filed a petition for relief under the United States Bankruptcy Code in December 31, 2003. He earned his BS in Electrical Engineering from the Georgia Institute of Technology.

RICHARD T. BROCK


I. SIGMUND MOSLEY, JR.
Age: 55

60

 Mr. BrockMosley is president and a director of Imlay Investments, Inc., and also serves as a director of The Imlay Foundation, Inc. He has been a director of the Company since May of 2005. From 1969 to 1991, Mr. Mosley held several positions with Management Science America, Inc., including Vice President from 1982 to 1991. Prior to that, he was with Peat Marwick & Mitchell. Mr. Mosley serves on the Company's inceptionboard of directors of several private companies, including Ardext Technologies, Inc., Bancintelligence, eQuorum Corporation, Rotunda, Inc., Kelly Registration, Inc., MCF Systems, Inc., Photobooks, Inc., SciHealth, Inc., Vocalocity, Inc., and USBA Holdings, Inc. He also serves on the board of directors of Entrepreneurs Foundation of the Southeast, GATV, and Techbridge, all non-profit organizations. Mr. Mosley received his Bachelor of Business Administration from Emory University.
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Code of Ethics
The Company has adopted a Code of Business Conduct and Ethics that applies to all of our directors, officers, and employees. The Code of Business Conduct and Ethics is posted on our website at www.firstwave.net under the caption “Codes and Charters” under “Investor Relations.”

Attendance
           The Company’s Board of Directors held eighteen meetings during 2005. No director attended less than 75% of the aggregate number of meetings of the Board and the committees of the Board on which he served. 
Committees of the Board
The Board has three standing committees - the Audit Committee, the Compensation Committee, and the Corporate Governance and Nominating Committee. Each committee has a written charter that complies with NASDAQ requirements pertaining to corporate governance. Each member of each of these committees has been determined to be independent as defined by applicable SEC rules and NASDAQ regulations. Copies of the charters of our various committees are posted on our website at www.firstwave.net under the caption “Codes and Charters” under “Investor Relations”.

Audit Committee
The purpose of the Audit Committee is to oversee the Company’s financial reporting process, internal control systems, audit process, and independent auditor qualifications. The responsibilities include selecting and hiring the Company’s independent accountants, overseeing the annual audit of the Company’s financial statements and evaluating and reviewing the Company’s internal financial reporting and accounting practices and policies, as well as other duties as the Board may specify. The Audit Committee adopted its Audit Committee Charter on March 29, 2001, which was revised on February 5, 2004 pursuant to new rules adopted by the SEC and NASDAQ. From January 1, 2005, through the Annual Meeting on May 6, 2005, the Audit Committee members were Messrs. Spencer, Babb, and Alan I. Rothenberg. Mr. Spencer has served as Chairman since November 15, 2003, and he has been determined by the Board to be an Audit Committee Financial Expert as defined by the rules of the SEC. Since May 6, 2005, the Audit Committee members were Messrs. Spencer, Babb, and Mosley. The Audit Committee met six times during 2005.
Policy on Audit Committee Pre-Approval
The Audit Committee is responsible for appointing, setting the compensation for monitoring the expenses of, and overseeing the work of the independent accountants. The Audit Committee must pre-approve all audit and permissible non-audit services greater than $5,000 provided by the independent accountants to assure that the provision of these services does not impair the independent accountants’ independence.

Financial Expertise
The Board has determined that all three members of the Audit Committee have experience relating to basic finance and accounting practices and the understanding of financial statements. The Board has determined that Mr. Spencer’s business background and accounting and financial experience is sufficient to qualify him as the “audit committee financial expert.”

Compensation Committee
The purpose of the Compensation Committee is to discharge the Board’s responsibility with respect to the compensation of the Company’s directors and officers and to evaluate and approve the Company’s compensation plans, policies and programs related to its officers and directors. The responsibilities of the Committee include making recommendations to the Board regarding compensation arrangements for executive management of the Company (including annual bonus compensation) and making recommendations as to the adoption of any compensation plans in which management is eligible to participate and the grants of stock options or other benefits under such plans. Besides ensuring that the Chief Executive Officer’s compensation strategy supports the Company’s objectives, the Committee evaluates the CEO’s performance in light of those objectives. From January 1, 2005 to May 6, 2005, the Compensation Committee consisted of Messrs. Rothenberg, Spencer, and Vincent Dooley, with Mr. Rothenberg serving as Chairman. From May 6, 2005, the Compensation Committee consisted of Messrs. Babb, Spencer, and Mosley, with Mr. Mosley serving as Chairman. The Compensation Committee met six times during 2005.
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Corporate Governance and Nominating Committee
The Corporate Governance and Nominating Committee was formed on October 1984,20, 2003, and consisted of Messrs. Babb, Dooley and Rothenberg, with Mr. Babb serving as Chairman, until May 6, 2005. From May 6, 2005, the Corporate Governance and Nominating Committee consisted of Messrs. Babb, Spencer, and Mosley, with Mr. Babb serving as Chairman. The purpose of the Corporate Governance and Nominating Committee is to ensure that the Company is governed in a manner consistent with the interest of the shareholders of the Company. The Corporate Governance and Nominating Committee met once during 2005 to nominate three directors for re-election to the Board. The Board has determined that each member of the Corporate Governance and Nominating Committee is independent in accordance with the NASDAQ requirements.

The responsibilities of the Committee include evaluation and recommendation concerning Board organization, membership and function, including changes in the size or composition of the Board, evaluation of the Board performance and the adequacy of its Charter, selection of directors in accordance with pre-determined criteria, as defined in the Corporate Governance and Nominating Committee charter, and establishment of procedures for soliciting and reviewing potential nominees from directors and shareholders. In addition, the Committee advises the Board on matters relating to planning for officer succession and formation and implementation of corporate governance policy.

The Committee identifies and evaluates nominees based on the skills, experience, areas of expertise and industry, knowledge of each candidate and the needs of the Company.

In addition to the Board of Directors, shareholders are entitled to recommend a nominee so long as such nominee is recommended by a shareholder who is entitled to vote to elect directors of the Company and the nomination is made in accordance with the procedural requirements set forth in the Articles and the Bylaws of the Company. The Committee will consider any nominee recommended in this manner using the same criteria it would use to evaluate any other nominee. Names of Nominees for the Company’s Board of Directors for consideration at the 2007 Annual Meeting must be submitted by written recommendation to the Company at its executive offices at 5775 Glenridge Drive, Suite E400, Atlanta, Georgia 30328, Attention: Richard T. Brock, no later than April 22, 2007.   

Compensation Committee Interlocks and Insider Participation
Messrs. Spencer, Babb and Mosley serve on the Company’s Compensation Committee. None of Messrs. Spencer, Babb or Mosley was at any time during 2005, or at any other time, an officer or employee of the Company. Neither Mr. Dooley or Mr Rothenberg was, during their tenure as Directors of the Company, or at any other time, an officer or employee of the Company. No interlocking relationships exist among the Board of Directors and the Compensation Committee of the Company and the board of directors and compensation committee of any other company.

Director Compensation
            During 2005, each non-management director of the Company received the following compensation:

      1.  Annual retainer of $10,000 payable in common stock of the Company at the market price as of the date of the Company’s annual shareholders’ meeting. If a director joins the Board in between annual meeting dates, the annual retainer is pro-rated accordingly. In 2005, each share of the Company’s common stock paid to directors as an annual retainer had a market price of $1.71 per share.
      2.  
A fee of $5,000 for each day on which he attended a Board meeting in person.
      3.  
A fee of $1,250 for attendance in person at Committee Meetings held outside of regularly scheduled Board meetings.
      4.  
A fee of $5,000 for the Chairman of the Audit Committee.

In addition, a one-time stock option grant of 7,500 options is awarded to each non-management director at the date of his or her appointment to the Company’s Board. In 2005, Mr. Mosley received 7,500 options at his appointment to the Board at an exercise price of $1.71 per share. Messrs. Spencer and Babb were also given a special fee of $30,000 each for serving on a Special Committee of the Board to review potential strategic opportunities of the Company. From time to time, non-management directors are granted options with an exercise price at the market price at date of grant.
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Non-management directors are reimbursed for expenses incurred in connection with attendance at Board and committee meetings. Management directors receive no additional compensation for their service on the Board of Directors.

In 2005, the directors received the following compensation from the Company:
    
Stock/Option Awards 
 
Name of Director
 
Aggregate Cash Payment
 
No. and Class of Shares
 
Value per Share/Exercise Price
 
Roger A. Babb(1) $50,000  
5,848 shares
25,000 options
 $1.71 $1.47 
Vincent I. Dooley $15,000       
I. Sigmund Mosley $10,000  
5,848 shares
25,000 options
 $1.71 $1.47 
Alan I. Rothenberg $15,000       
John N. Spencer(1) $55,000  
5,848 shares
25,000 options
 $1.71 $1.47 
________________
(1) Messrs. Mosley and Spencer deferred $5,000 of earned Board Meeting compensation to 2006.
Required Vote
Directors are elected by a plurality of the votes cast, which means the two nominees who receive the highest number of votes FOR, in person or by proxy, will be elected as directors. Shareholders may withhold their vote from the nominee by so indicating in the space provided on the enclosed proxy card. Shareholders may withhold their vote from the nominee by writing that nominee’s name in the space provided for that purpose on the enclosed proxy card.

THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS
VOTE “FOR” THE ELECTION AS DIRECTORS OF THE COMPANY OF I. SIGMUND MOSLEY, ROGER A. BABB, AND RICHARD T. BROCK, TO SERVE ON
THE COMPANY’S BOARD OF DIRECTORS
PROPOSAL 3 - RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS

The Company has selected Cherry, Bekaert & Holland, L.L.P. as its independent auditors to perform the audit of its financial statements for the year ending December 31, 2006, and the stockholders are being asked to ratify this selection. Representatives of Cherry, Bekaert & Holland, L.L.P. are expected to be present at the meeting, will have the opportunity to make a statement at the meeting if they desire to do so, and are expected to be available to respond to appropriate questions.

The affirmative vote of a majority of the shares of the Company’s common stock represented in person or by proxy at the Annual meeting and entitled to vote on the proposal will be required to approve the ratification of Cherry, Bekaert & Holland, L.L.P. as the Company’s independent auditors. Abstentions will be treated as votes against the ratification of Cherry, Bekaert & Holland, L.L.P. as the Company’s independent auditors and broker non-votes will have no effect on the voting results.

THE BOARD OF DIRECTORS RECOMMENDS A VOTE “FOR” THE RATIFICATION
OF THE SELECTION OF CHERRY, BEKAERT & HOLLAND, L.L.P.
9

EXECUTIVE OFFICERS

The executive officers of the Company serve at the discretion of the Board of Directors. At the end of 2005, Richard T. Brock was the sole executive officer of the Company. Set forth below is certain information regarding the current officer of the Company. 

RICHARD T. BROCK
Mr. Brock, age 58, currently serves as the Company'sCompany’s Chairman of the Board, President, and Chief Executive Officer.Officer, and he has been a director since the Company’s inception in October 1984. He is the founder of the Company and served as the Company'sCompany’s Chief Executive Officer from October 1984 until November 1992, and also from November 1994 until December 1996. Mr. Brock is the founder of Brock Capital Partners, a capital investment firm. He is also a director of Datastream Systems, Inc., a leading provider of maintenance software. Prior to founding the Company, Mr. Brock founded and served as Chief Executive Officer of Management Control Systems, Inc., an accounting software company, now known as CLR Professional Software. Mr. Brock received a MBA from Louisiana State University and a BS from Spring Hill College.College, an MBA from Louisiana State University. He is also a Certified Public Accountant.

RICHARD D. JACKSON


Age: 66

        Mr. Jackson is Chairman of the Board of ebank.Financial Services, Inc., a unitary thrift holding company that serves the financial needs of both retail and small business customers through its Atlanta-based banking center and the Internet. From 1993 to 1996, Mr. Jackson served as Vice Chairman and Senior Executive Vice President of First Financial Management Corporation, from 1986 to 1993 served as Vice Chairman, Chief Executive Officer and President of Georgia Federal Bank and from 1974 to 1986 served as Chief Executive Officer and President of First Georgia Bank. Mr. Jackson also serves as a director of Schweitzer-Mauduit International, Inc., a diversified producer of premium specialty papers and the world's largest supplier of fine papers to the tobacco industry. Mr. Jackson earned his BBA from Marshall University and graduated from Louisiana State University School of Banking of the South.

JOHN F. KEANE
Age: 71

        Mr. Keane has been a director of the Company since December 1997. He is Chairman of Keane, Inc., an application development, outsourcing, and integration services firm, which he founded in 1965. Previous to this, Mr. Keane held various positions in marketing for IBM and was a consultant for Arthur D. Little. He serves as a director of American Power Conversion Inc., a provider of power protection systems and iPower Logistics, an e-marketplace for industrial distributors and manufacturers. He is a graduate of Harvard College and Harvard School of Business.

ALAN I. ROTHENBERG
Age: 63

        Mr. Rothenberg has been a director of the Company since February 2003. From 1990 until his retirement in 2000, Mr. Rothenberg was a Partner at Latham & Watkins, one of the world's largest and most successful law firms, offering sophisticated corporate finance, mergers & acquisitions, technology

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transactions, venture & technology, and strategic partnering/private investment funds practices. From 1968 to 1990, Mr. Rothenberg was founder and Managing Partner of Manatt, Phelps, Rothenberg, & Phillips, a Los Angeles law firm specializing in business and commercial litigation including practices in the sports, entertainment, and financial fields. From 1990 through 1998, he served as President of the United States Soccer Federation. Mr. Rothenberg serves on the boards of directors of Major League Soccer, United States Soccer Foundation, Los Angeles County Bar Association Dispute Resolution Services, Constitutional Rights Foundation, Los Angeles Convention and Visitors Bureau, LA Sports Council, and Zenith National Insurance, which provides workers' compensation insurance and participates in the worldwide reinsurance business. He received his BA from the University of Michigan and his JD, with distinction, from the University of Michigan Law School.

Required Vote

        Directors are elected by a plurality of the votes cast, which means the five nominees who receive the highest number of votes FOR, in person or by proxy, will be elected as directors.

THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR THE
ELECTION AS DIRECTORS OF THE NOMINEES LISTED ABOVE.

Additional Information Concerning the Board of Directors

        The Company's Board of Directors held four meetings during 2002. The Board has an Audit Committee and a Compensation Committee, but does not have a Nominating Committee. No director attended less than 75% of the aggregate number of meetings of the Board and the committees of the Board on which he served. Effective October 2, 2002, Michael T. McNeight resigned his position on the Board. Effective February 7, 2003, Alan I. Rothenberg was appointed to the Board to fill the vacancy created by Mr. McNeight's resignation.

        The Audit Committee in 2002 consisted of Messrs. Keane, McNeight, Porter, and Babb. Mr. Keane served as Chairman of the Audit Committee during 2002. The responsibilities of the Audit Committee include, in addition to such other duties as the Board may specify, reviewing and making recommendations to the Board regarding the Company's engagement of independent accountants, the annual audit of the Company's financial statements, and the Company's internal accounting practices and policies. The Audit Committee met twice during 2002. The Audit Committee adopted its Audit Committee Charter on March 29, 2001.

        The Compensation Committee in 2002 consisted of Messrs. Keane, McNeight, Porter, and Babb. Mr. Porter served as Chairman of the Compensation Committee during 2002. The responsibilities of the Compensation Committee include, in addition to such other duties as the Board may specify, making recommendations to the Board regarding compensation arrangements for senior management of the Company (including annual bonus compensation), the adoption of any compensation plans in which management is eligible to participate and the grants of stock options or other benefits under such plans. The Compensation Committee met three times during 2002.

        During 2002, each non-management director of the Company received an annual retainer of $5,000 and a fee of $2,500 for each day on which he attended a Board or committee meeting. During 2002, each non-management director of the Company was granted options to purchase a total of 1,667 shares of Common Stock pursuant to the Company's 1993 Stock Option Plan. Also during 2002, 26,002 options were granted to non-management directors related to a Stock Exchange Program which allowed each of the Company's directors and employees who held options under the Option Plan with an exercise price of greater than $10.00 the opportunity to surrender those options for cancellation in exchange for new options to be granted approximately six months and one day after cancellation. All such options were granted at fair market value on the date of grant, with the exception of those issued to Mr. Brock, which were issued at 110% of fair market value pursuant to the terms of the plan. All

5


such options vest over four years, and have an exercise period of ten years. Directors are reimbursed for expenses incurred in connection with attendance at Board and committee meetings.

Executive Officers

        The executive officers of the Company serve at the discretion of the Board of Directors. At the end of 2002, the executive officers of the Company consisted of Richard T. Brock, Debbie N. Qaqish, David R. Simmons, and Judith A. Vitale. Ms. Qaqish resigned her position as Vice President of US Sales effective February 13, 2003. Set forth below is certain information furnished by each of the officers of the Company.

RICHARD T. BROCK—Please see biographical information contained on Page 3.

DAVID R. SIMMONS
Age: 47

        Mr. Simmons joined the Company as Chief Operating Officer in October 2002. Prior to his role at Firstwave, Mr. Simmons served as President and CEO of the Technology Association of Georgia (TAG) from its inception in 1999 until September 2002. Mr. Simmons continues to serve on TAG's Board of Directors. Prior to TAG, Mr. Simmons was Chief Operating Officer of Measured Marketing Inc. He has an extensive background in sports management, serving as Chief Operating Officer of the 1996 Atlanta Paralympic Games and Venue Executive Director of the 1994 World Cup USA, Los Angeles. Mr. Simmons is on the Advisory Council of ICAPP, the University System of Georgia's Intellectual Capital Partnership Program, and the Advisory Board of the Dupree College of Management, and previously served on the Entrepreneurial Program and the Steering Committee for the Metropolitan Atlanta Chamber of Commerce "Industries of the Mind" initiative. Mr. Simmons received a BA in Economics from the University of California at Irvine and an MBA in Finance and Accounting from the University of Southern California.

JUDITH A. VITALE
Age: 48

        Ms. Vitale has served the Company as Chief Financial Officer since November of 2001. Prior to that time, she held various positions with the Company since its formation in October 1984, including Vice President and Director of Finance and Administration, Manager of Administration, Manager of Finance, and Corporate Controller. From 1979 until the formation of the Company, Ms. Vitale was the Manager of Administration at Management Control Systems, Inc. She has a BS in Management from Shorter College.

6

Compliance with Section 16(a) of the Securities Exchange Act of 1934

        Section 16(a) of the Securities Exchange Act of 1934 (the "Exchange Act") requires the Company's directors, executive officers and persons who own beneficially more than 10% of the Company's Common Stock to file reports of ownership and changes in ownership of such stock with the Securities and Exchange Commission (the "SEC"). Directors, executive officers, and greater than 10% shareholders are required by SEC regulations to furnish the Company with copies of all such forms they file. To the Company's knowledge, based solely on a review of the copies of such reports furnished to the Company and written representations that no other reports were required, with the exception of Messrs. Porter, Brock, Keane, and McNeight and Ms. Vitale each of whom were 10 days late in filing their September 20, 2002 Forms 4 related to the Company's stock exchange program, and Mr. Simmons who was 8 days late in filing his October 11, 2002 Form 3, all of its directors and executive officers complied during 2002 with all applicable Section 16(a) filing requirements. These Forms 4 were the first filings after the August 29, 2002 enactment of the two-day reporting requirement; otherwise the filings would have been in compliance.


BENEFICIALSECURITY OWNERSHIP OF COMMON STOCKCERTAIN BENEFICIAL OWNERS AND MANAGEMENT


The following table sets forth information concerning (i) those persons known by management of the Company to own beneficially more than 5% of the Company'sCompany’s outstanding Common Stock, (ii) the directors and director nominees of the Company, (iii) the executive officers named in the Summary Compensation Table included elsewhere herein (the "Named“Named Executive Officers"Officers”), and (iv) all current directors and current executive officers of the Company as a group. Except as otherwise indicated in the footnotes below, such information is provided as of March 18, 2003. 27, 2006.

According to rules adopted by the SEC, a person is the "beneficial owner"“beneficial owner” of securities if he or she has or shares the power to vote them or to direct their investment or has the right to acquire beneficial ownership of such securities within 60 days through the exercise of an option, warrant, or right, conversion of a security or otherwise. These shares are deemed outstanding for computing the ownership percentage of each person holding options but are not deemed outstanding for computing the ownership percentage of any other person. The percentage of beneficial ownership is based upon 3,666,781 shares of Common Stock outstanding as of March 27, 2006, including 898,479 shares that may be acquired upon conversion of preferred stock.

Except as otherwise noted, the indicated owners have sole voting and investment power with respect to shares beneficially owned, and their address is 2859 Paces Ferry Road,5775 Glenridge Drive, Suite 1000,E400, Atlanta, Georgia 30339.30328. An asterisk in the percent of class column indicates beneficial ownership of less than 1% of the outstanding Common Stock.
  Amount     
  and Nature     
  of Beneficial   Percent 
Name of Beneficial Owner Ownership   of Class 
Richard T. Brock  944,733 
(1
)
 
25.8%
 
Gregory O. Sargent  524,749    
14.4%
 
Roger A. Babb  53,175 
(2
)
 
1.5%
 
John N. Spencer, Jr.  43,674 
(3
)
 
1.2%
 
I Sigmund Mosley  38,348 
(3
)
 
1.0%
 
David R. Simmons(6)
  10,000 
(4
)
 
0.3%
 
Judith A. Vitale(7)
  3    
0.0%
 
All directors and executive officers as a group (4 persons)  1,079,930 
(5
)
 
29.5%
 
________________
      (1)  Includes 159,418 shares subject to options exercisable and 640,207 shares that  may be acquired upon conversion of preferred stock on or before May 27, 2006.
      (2)  Includes 36,668 shares subject to options exercisable on or before May 27, 2006.
      (3)  Includes 32,500 shares subject to options exercisable on or before May 27, 2006.
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      (4) Includes 10,000 shares that may be acquired upon conversion of preferred stock  on or before May 27, 2006.
      (5) Includes 261,086 shares subject to options exercisable and 650,207 shares that  may be acquired upon conversion of preferred stock on or before May 27, 2006.
      (6) Mr. Simmons resigned from the Company on March 22, 2005.
      (7) Ms. Vitale resigned from the Company on October 20, 2005.

All share amounts have been adjusted to reflect a one-for-three reverse splitcurrent officers and directors may be contacted at the Company’s corporate officers, located at 5775 Glenridge Drive, Suite E400, Atlanta, Georgia 30339.

SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Section 16(a) of the Company'sSecurities Exchange Act of 1934 (the “Exchange Act”) requires the Company’s directors, executive officers and persons who own beneficially more than 10% of the Company’s Common Stock effective September 12, 2001.

Name of Beneficial Owner
 Amount
and Nature
of Beneficial
Ownership
 Percent
of Class
 
Richard T. Brock 1,023,359(1)33.2%
Roger A. Babb 16,503(2)* 
James R. Porter 16,389(3)* 
John F. Keane 10,836(4)* 
Judith A. Vitale 9,694(5)* 
Alan I. Rothenberg 2,000 * 
David R. Simmons —   
  
   
All directors and executive officers as a group (7 persons) 1,078,781(6)34.9%
(1)
Includes 14,544 shares subject to options exercisablefile reports of ownership and 640,207 shares that may be acquired upon conversionchanges in ownership of preferredsuch stock with the Securities and Exchange Commission (the “SEC”). Directors, executive officers, and greater than 10% shareholders are required by SEC regulations to furnish the Company with copies of all such forms they file. To the Company’s knowledge, based solely on or before May 18, 2003.

(2)
Includes 9,169 shares subject to options exercisable on or before May 18, 2003.

(3)
Includes 10,836 shares subject to options exercisable and 3,086 shares that may be acquired upon conversion of preferred stock on or before May 18, 2003.

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(4)
Includes 10,836 shares subject to options exercisable on or before May 18, 2003.

(5)
Includes 9,691 shares subject to options exercisable on or before May 18, 2003.

(6)
Includes 55,076 shares subject to options exercisable and 643,293 shares that may be acquired upon conversion of preferred stock on or before May 18, 2003.


EXECUTIVE COMPENSATION

Under the SEC rules for proxy statement disclosure of executive compensation, the Compensation Committeea review of the Boardcopies of Directorssuch reports furnished to the Company and written representations that no other reports were required, the Company believes that all of its directors andofficers and holders of greater than 10% of the Company’s common stock complied in a timely manner with all applicable Section 16(a) filing requirements during 2005, except for Mr. David Kane, Controller and Principal Financial Officer of the Company, has prepared the following reportwhose initial Form 3 and Form 4 were filed on executive compensation. February 27, 2006.


EXECUTIVE COMPENSATION
Set forth below is a discussion of the Company'sCompany’s executive compensation philosophy and policies as established and implemented by the Compensation Committee of the Company’s Board of Directors for 2002.2005. The Compensation Committee Report shall not be deemed to be “soliciting material” or to be “filed” with the SEC, nor shall it be incorporated by reference into any filing by the Company under the Securities Act of 1933, as amended, or the Securities Exchange Act of 1934, as amended.

Compensation Committee Report on Executive Compensation

        In past years,


The Compensation Committee determines the compensation offered to the Company’s executive officers. The Committee is composed entirely of independent directors appointed by the full Board of Directors. Historically, the Compensation Committee has set the levels and types of compensation for its executive officers based generally upon (i) perceived levels and types of compensation paid by the Company'sCompany’s competitors to their executive officers, (ii) the desire to have some portion of each executive officer'sofficer’s compensation be incentive in nature, and (iii) an evaluation of each executive officer'sofficer’s ability to contribute to the continued success of the Company. During 2002, the executive officer's compensation included short term incentive compensation based on attainment of revenue and net income goals.

        In light of the Company's compensation policy,


The Compensation Committee has set the components of its executive compensation program in 2003 will befor 2006 to consist of a base salaries, short termsalary for Mr. Brock. There is no short-term incentive awardscomponent of bonus or commission in the form of cash bonuses or commissions, and long-term incentive awards in the form of stock options.executive compensation program for 2006. The procedure used to determine the level of each of these components of compensationbase salary is discussed in more detail below.


Base Salaries.Salary. The Compensation Committee typically reviews various studies and reports prepared by outside compensation consultants regarding base salary levels for officers of other public companies in the software industry holding the same or similar positions as the executive officers of the Company. Although the data used by such compensation consultants may be available publicly, the Compensation Committee uses suchthe industry information in the form provided by its compensation consultants to take advantage of the analytical input provided by such consultants that makes suchthe industry information more directly applicable to the Company and the functions performed by its executive officers, including the Named Executive Officers.officers. The Compensation Committee then sets each officer'sofficer’s salary level based on the officer'sofficer’s experience level, the scope and complexity of the position held, (taking into account any changes to be made), and the officer'sofficer’s performance during the past year.


        Short-Term Incentive Compensation—Bonuses and Commissions.    The goal of the short-term incentive component of the Company's compensation packages is to place a significant portion of each officer's compensation at risk to encourage and reward a high level of performance each year.

        For 2003, the Compensation Committee has set the short-term incentive compensation levels at 45% to 50% of total compensation. The criteria for earning bonuses are Company-level financial performance targets (including growth in revenues, operating income, and cash).

Long-Term Incentive Compensation—Compensation -- Stock Options.    The goal of the long-term incentive component of the Company's compensation packages is to secure, motivate, and reward officers and align their interests with the interests of shareholders through the grant of stock options. Under the Option Plan, the Compensation Committee is authorized to grant incentive and non-qualified stock options to key employees. The number of options granted is based on the position held by the individual, his or her performance, the prior level of equity holdings by the officer and the Compensation Committee'sCommittee’s assessment of the officer'sofficer’s ability to contribute to the long-term success of

8


the Company. The Compensation Committee receives and takes into account data provided by its compensation consultants regarding executives in comparable positions and management'smanagement’s recommendations concerning proposed option grants. No particular weight is

11
given to any single factor. Options granted generally vest in equal annual increments over a period of four yearsimmediately and terminate at the end of 10 years. For a summary of option grants in 20022005 to the Company'sCompany’s Named Executive Officers, see "Executive“Executive Compensation Tables—Tables - Table II—II - Option Grants in 2002."

2005.”


Compensation of the Chief Executive Officer.    TheMr. Brock’s compensation of Mr. Brock wasis established for 2002 by the Compensation Committee. His base salary for 2002 was $250,000, which represented a $10,000 increase from his salary in 2001. The salary wascompensation package is based on the Compensation Committee'sCommittee’s assessment of Mr. Brock'sBrock’s contributions to the Company and his experience and capabilities in the Company'sCompany’s industry. In 2002, Mr. Brock hadHis base salary for 2005 was $125,000 for the first six months of 2005 and $150,000 for the last six months of 2005. The Compensation Committee also established a short-term incentive compensation plan whereby he could earn $250,000 (at target) in incentive pay. Due tofor Mr. Brock for 2005 based upon the Company's attainment of revenue and net income goals for 2002,certain cash flow goals. No short-term incentive was earned by Mr. Brock earned 94% of hisin 2005. For 2006, the Compensation Committee has set the base salary for Mr. Brock at $150,000. Mr. Brock is under no short-term incentive target.plan for 2006.


Compensation of the Chief OperatingFinancial Officer.Ms. Vitale was the Chief Financial Officer of the Company until her resignation on October 20, 2005. The compensation of Mr. SimmonsMs. Vitale for 2005 was established by the Compensation Committee. His annualized base salary for 2002 was $210,000. The salarycompensation package was based on the Compensation Committee's review of other executives in similar positions in the software industry as well as the assessment of Mr. Simmons experience and expected contributions to the Company. In the fourth quarter of 2002, Mr. Simmons had a short-term incentive compensation plan whereby he could earn $10,000 in incentive pay. Due to the Company's attainment of revenue and net income goals for 2002, Mr. Simmons earned 100% of his incentive target.

        Compensation of the Chief Financial Officer.    The compensation of Ms. Vitale was established for 2002 by the Compensation Committee. Her base salary for 2002 was $170,000. The salary was based on the Compensation Committee'sCommittee’s assessment of Ms. Vitale'sVitale’s contributions to the Company and her experience and capabilities in the Company'sCompany’s industry. In 2002,Her base salary for 2005 was $180,000. However, Ms. Vitale had a short-term incentive compensation plan whereby she could earn $80,000 (at target) in incentive pay. Duevoluntarily reduced her base salary to $165,000 until the Company's attainment of revenue and net income goals for 2002, Ms. Vitale earned 81% of her incentive target.Company’s financial condition improved.


Limitations on Deductibility of Compensation.Under the Omnibus Budget Reconciliation Act, a portion of annual compensation payable after 1993 to any of the Company'sCompany’s five highest paid executive officers would not be deductible by the Company for federal income tax purposes to the extent such officer'sofficer’s overall compensation exceeds $1,000,000. Qualifying performance-based incentive compensation, however, would be both deductible and excluded for purposes of calculating the $1,000,000 base. Although the Compensation Committee has not and does not presently intend to award compensation in excess of the $1,000,000 cap, it will continue to address this issue when formulating compensation arrangements for executive officers.

THE COMPENSATION COMMITTEE
OF THE BOARD OF DIRECTORS
Roger A. Babb
John F. Keane
James R. Porter, Chairman


The report on executive compensation of the Board of Directors shall not be deemed to be incorporated by reference as a result of any general incorporation by reference of this Proxy Statement or any part hereof in the Company's Annual Report to Shareholders or Form 10-K.                        THE COMPENSATION COMMITTEE

Compensation Committee Interlocks                        OF THE BOARD OF DIRECTORS
                        I. Sigmund Mosley, Chairman
                        John N. Spencer, Jr.
                        Roger A. Babb


Certain Relationships and Insider ParticipationRelated Transactions

        During 2002, the Compensation Committee of the Board of Directors consisted of Messrs. Babb, Keane, McNeight, and Porter, with


In 1999, Mr. Porter serving as Chairman. None of such members serves or

9


has served as an officer or employee of the Company. No executive officer of any entity with an executive officer of the Company serving as one of its directors served on the Company's Board of Directors during 2002.

Certain Transactions

        On April 26, 1999, the Company soldBrock acquired 10,000 shares of its Series A Convertible Preferred Stock, for an aggregate purchase price of $1,000,000 to Mr. Brock, the Company's Chief Executive Officer. The Series A Convertible Preferred Stock accumulateswhich accumulate dividends at aan annual rate of 9% that are payable in cash.cash monthly. For the year of 1999, the Company paid $61,444 of dividends in cash to Mr. Brock in January 2000, pursuant to the terms of the preferred stock. For the year of 2000, the Company paid $90,000 in dividends in cash with interest over twelve months, in equal payments, to Mr. Brock, beginning February 15, 2001, pursuant to the terms of the preferred stock. For the year of 2001, the Company paid $90,000 of dividends in cash to Mr. Brock in January 2002, pursuant to the terms of the preferred stock. For the year of 2002,2005, the Company paid $90,000 of dividends in cash to Mr. Brock, pursuant to the terms of thethis preferred stock. The Series A Convertible Preferred Stock is convertible into Common Stock161,812 shares of common stock of the Company at the option of the holder at a conversion price of $6.18.

        On November 15,


In 2000, the Company soldMr. Brock acquired 5,000 shares of its Series B Convertible Preferred Stock, for an aggregate purchase price of $500,000 to Mr. Brock, and issued 250 shares of its Series B Convertible Preferred Stock for an aggregate purchase price of $25,000 to Mr. Jim Porter, a director of the Company. The Series B Convertible Preferred Stock accumulateswhich accumulate dividends at aan annual rate of 9% that are payable in cash.cash monthly. For the years 2000 and 2001,year of 2005, the Company paid $50,671$45,000 of dividends in cash to Mr. Brock, and $2,453pursuant to the terms of dividends in cash to Mr. Porter in January of 2002. For the year 2002, the Company paid dividends in cash to Mr. Brock and Mr. Porter of $45,000 and $2,250, respectively.this preferred stock. The Series B Convertible Preferred Stock is convertible after a periodinto 61,728 shares of six months from issuance into Common Stockcommon stock of the Company at the option of the holder at a conversion price of $8.10.

        On February 12, 2001, Richard Brock loaned the Company $750,000, pursuant to the terms of a promissory note with interest paid annually at nine percent (9%), with a maturity date of January 15, 2002.

        On July 18,


In 2001, Mr. Brock executed a new convertible secured promissory note in exchange for the promissory note dated February 12, 2001, providing for the automatic conversion of the note into preferred stock upon the required shareholder approval. Such approval was obtained September 7, 2001 at a Special Meeting of Shareholders, and the note was automatically converted intoacquired 10,000 shares of Series C Convertible Preferred Stock. The Series C Convertible Preferred Stock, accumulateswhich accumulate dividends at aan annual rate of 9% that are payable in cash monthly. For the year of 2001, the Company paid $21,452 of dividends in cash to Mr. Brock, pursuant to the terms of the preferred stock. For the year of 2002,2005, the Company paid $67,500 of dividends in cash to Mr. Brock, pursuant to the terms of thethis preferred stock. The Series C Convertible Preferred Stock is convertible into Common Stock416,667 shares of common stock of the Company at the option of the holder at a conversion price of $1.80.

        On July 18, 2001, Mercury Fund II, Ltd. invested $500,025 in the Company through the form of a purchase of a convertible secured promissory note that would automatically convert into equity in the form of preferred stock when the required shareholder approval was obtained. Such approval was obtained September 7, 2001 at a Special Meeting of Shareholders, and the investment was automatically converted into 6,667 shares of Series C Convertible Preferred Stock. The Series C Convertible Preferred Stock accumulates dividends at a rate of 9% that are payable in cash monthly. For the year of 2001, the Company paid $14,302 of dividends in cash to Mercury Fund II, Ltd., pursuant to the terms of the preferred stock. For the year of 2002, the Company paid $32,036 of dividends in cash to Mercury Fund II, Ltd., pursuant to the terms of the preferred stock. The Preferred

10

Stock is convertible into Common Stock of the Company at the option of the holder at a conversion price of $1.80.

        The transactions relating to the conversion of Mr. Brock's promissory note and the issuance of Series C Preferred Stock were described in detail in the Company's proxy statement mailed to shareholders in August 2001 in connection with the September 7, 2001 Special Meeting of Shareholders.


Other than compensation arrangements described elsewhere in this Proxy Statement and the above referenced transactions, the Company was not a party to any transaction (or series of transactions) nor did it have any relationship with any related party requiring disclosure of such transaction or relationship under applicable SEC disclosure rules during 2002.

11

2005.
12


Executive Compensation Tables


The following tables set forth certain information required by the SEC relating to various forms of compensation earned by the persons serving as Chief Executive Officer ("CEO"(“CEO”) of the Company during 20022005 and the other four most highly compensated executive officers whose total salary and bonus for 2002 equaled or exceeded $100,000.

officers.


Table I—I - Summary Compensation Table

Table I presents the total compensation paid to or accrued by the Named Executive Officers during 2002, 2001,2005, 2004, and 2000.

 
  
  
  
  
 Long Term
Compensation(1)
  
 
  
 Annual Compensation
 All Other
Compensation(2)
Name and Position
  
 ($)
Salary
 ($)
Bonus
 ($)
Other Annual
Compensation(3)
 Options
(#)
 Year
 ($)
Richard T. Brock
President and CEO		 2002
2001
2000		 250,000
240,000
240,000		 235,022
—
38,220		 —
—
—		 13,334
2,417
6,667		 3,411
—
—
David R. Simmons(4)
COO		 2002 46,173 10,000 — 25,000 263
Judith A. Vitale
CFO		 2002
2001
2000		 170,000
155,000
138,333		 64,631
—
17,200		 —
—
—		 11,999
10,750
3,333		 48,628
1,987
2,328
R. Kelly Mayo(5)
VP, Client Services		 2002
2001
2000		 99,098
135,000
5,625		 —
—
—		 —
—
—		 —
8,333
19,083		 23,055
—
Debbie N. Qaqish(6)
VP, Sales		 2002
2001		 140,000
5,833		 —
—		 —
—		 —
15,000		 12,188
—
(1)
The Company did not award any restricted stock or other long-term incentives other than stock options during 2000, 2001 or 20022003.
    Annual Compensation Long Term All Other
        ($) 
Compensation (1)
 
Compensation (2)
    ($) ($) Other Annual Options  
Name and Position Year Salary Bonus Compensation (#) ($)
Richard T. Brock
(3)
2005 83,333 - - 25,000 1,831
Chairman and CEO 2004 67,083 - - 100,000 3,209
  2003 270,000 - - 17,000 4,186
             
David R. Simmons
(4)
2005 13,654 - - - 10,726
President and COO 2004 200,833 - - 47,000 3,012
  2003 240,625 - - 57,000 3,600
             
Judith A. Vitale
(5)
2005 115,976 - - - 14,291
CFO 2004 169,375 - - 36,000 3,596
  2003 180,000 - - 15,000 3,600
             
Jeffrey L. Longoria 
(6)
2005 15,500 - - - 6,154
Sr. VP of Sales 2004 164,375   - 36,000 450
  2003 125,000 97,991 - 25,000 -
________________
(1)  The Company did not award any restricted stock or other long-term incentives other than stock options during 2003, 2004 or 2005 to its officers. Accordingly, columns relating to such awards have been omitted.
   (2)  
Includes Company matching contributions to the indicated person’s 401 (k) plan account, any benefit coverage, and income realized from the exercise and sale of stock options.
   (3)  
Mr. Brock deferred a portion of his $150,000 base salary until 2006.
   (4)  
Mr. Simmons resigned from the Company on March 22, 2005.
   (5)  
Ms. Vitale resigned from the Company on October 20, 2005.
   (6)        
Mr. Longoria resigned from the Company on September 30, 2005.


(2)
Includes Company matching contributions to the indicated person's 401 (k) plan account, commissions, severance pay and option income.

(3)
Information with respect to certain perquisites and other personal benefits awarded to the named executive officers has been omitted because in each case, the aggregate value of these items is less than $50,000 or 10% of the executive's annual salary and bonus for the years reported above.

(4)
Mr. Simmons joined the Company as an executive officer on October 11, 2002, with an annualized salary of $210,000.

(5)
Mr. Mayo joined the Company on December 18, 2000, with an annualized salary of $135,000. He resigned his position on September 15, 2002.

(6)
Ms. Qaqish joined the Company on December 17, 2001, with an annualized salary of $140,000. She resigned her position on February 13, 2003.

12

Table II—II - Option Grants in 20022005


Table II presents information regarding options to purchase shares of common stock granted to the Named Executive Officers during 2002 to purchase shares of Common Stock.2005. In accordance with SEC rules, the table shows the hypothetical "gains"“gains” or "option spreads"“option spreads” that would exist for the respective options based on assumed rates of annual compound stock price appreciation of 5% and 10% from the date the options were granted over the full option term.

 
  
  
  
  
 Potential Realizable Value at Assumed Annual Rates of Stock Price Appreciation for Option Term
 
 Individual Grants
  
 
 No. of
Securities
Underlying
Options
Granted(1)
 % of Total
Options
Granted to
Employees
during Year
  
  
 
 Exercise
or Base
Price
($)/Share
  
Name
 Date of
Expiration
 5%
($)
 10%
($)
Richard T. Brock 6,667
6,667		 4.05
4.05		 7.71
7.01		 09/20/12
09/20/12		 24,725
29,392		 69,818
74,485
David R. Simmons 25,000 15.17 5.55 10/11/12 87,259 221,132
Judith A. Vitale 333
8,333
3,333		 0.20
5.00
2.00		 7.01
7.01
7.01		 09/20/12
09/20/12
09/20/12		 1,468
36,736
14,694		 3,720
93,097
37,237
          Potential Realizable
          Value at Assumed
  Individual Grants   Annual Rates of
  No. of % of Total     Stock Price
  Securities Options Exercise   Appreciation for
  Underlying Granted to or Base   Option Term
  Options Employees Price Date of 5% 10%
Name Granted during Year ($)/Share Expiration ($) ($)
             
Richard T. Brock 20,000
 (1)
18.87 1.47 10/13/2015 2,851 5,701
      ________________
(1)
These options becomewere 100% exercisable in 25% increments on the first, second, third, and fourth anniversaries of the date of grant. Shares may be withheld upon exercise to pay applicable withholding taxes. Under certain circumstances, the options are subject to immediate vesting in the event of a change of control of the Company. Those grants shown with an expiration date of 09/20/12 are grants issued a result of the Officers' participation in the Stock Exchange Program which allowed each of the Company's directors and employees who held options under the Option Plan with an exercise price of greater than $10.00 the opportunity to surrender those options for cancellation in exchange for new options to be granted approximately six months and one day after cancellation.

13


Table III—III - Aggregated Option Exercises in 20022005 and 20022005 Year-End Option Values


Table III presents information regarding options exercised for shares of the Common Stockcommon stock during 20022005 and the value of unexercised options held at December 31, 2002.2005. There were no SARs outstanding during 2002.2005. Accordingly, columns relating to such awards have been omitted. The value of exercisable and unexercisable in-the-money options at year-end was calculated based on $15.92,$1.75, the closing sale price of a share of Common Stockcommon stock reported on the NasdaqNASDAQ SmallCap Market on December 31, 2002.

 
  
  
 Number of
Unexercised Options
at Year-End
(#)
  
  
 
  
  
 Value of Unexercised In-the-Money Options at Year End(1)
$
 
 Shares
Acquired on
Exercise
#
  
Name
 Value
Received
$
 Exercisable
 Unexercisable
 Exercisable
 Unexercisable
Richard T. Brock — — 12,273 5,145 112,655 53,475
R. Kelly Mayo 6,857 17,430 — — — —
Debbie N. Qaqish — — 3,750 11,250 56,138 168,413
David R. Simmons — — — 25,000 — 259,250
Judith A. Vitale 8,939 45,796 6,171 11,810 47,384 124,083
2005. As the Board of Directors of the Company voted to accelerate vesting of all unvested options during 2005, there were no unexercisable options as of December 31, 2005.
       Value of Unexercised
Shares Number of In-the-Money Options
  Acquired onValueUnexercised Options 
at Year End (1)
  ExerciseReceivedat Year-End (#) $
Name #$ExercisableUnexercisable ExercisableUnexercisable
         
Richard T. Brock --159,418  7,580 
_______________
(1)
Value of Unexercised In-the-Money Options at December 31, 20022005 is calculated as follows: Per Share Closing Sale Price on December 31, 20022005 less Per Share Exercise Price times the Number of Shares Subject to Unexercised Options. The per share price on December 31, 20022005 was $15.92.

13

$1.75.

14


Performance GraphSTOCK PERFORMANCE GRAPH

The following indexed line graph indicates the Company'sCompany’s total return to shareholders from December 31, 19971999 to December 31, 2002,2005, as compared to total return for the Russell 2000 and Russell 2000-Technology indices for the same period. The Russell 2000 index is comprised of the 2,000 publicly traded companies with market capitalizations (in terms of number of shares outstanding) ranked immediately below the 1,000 companies with the highest market capitalizations. The Russell 2000-Technology index is comprised of the 2,000 publicly traded companies in the high-technology industry with market capitalizations (in terms of number of shares outstanding) ranked immediately below the 1,000 companies in the high-technology industry with the highest market capitalizations.



COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*
AMONG FIRSTWAVE TECHNOLOGIES, INC., THE RUSSELL 2000 INDEX
AND THE RUSSELL 2000 TECHNOLOGY SECTOR INDEX

CHART

*
$100 Invested on 12/31/97 in stock or index-
including reinvested of dividends.
Fiscal year ending December 31.

14


PROPOSAL 2—AMENDMENT OF THE COMPANY'S
1993 STOCK OPTION PLAN

Description of Plan and Proposed Amendment

        The Firstwave Technologies, Inc. 1993 Stock Option Plan (the "Option Plan") permits the issuance of both incentive and non-qualified stock options to purchase Common Stock to directors and employees of the Company. The Option Plan currently provides for the grant of options to purchase up to 516,667 shares of Common Stock to such directors and key employees, as adjusted for the one-for-three reverse stock split of the Company's Common Stock effective September 12, 2001. On March 19, 2002 the Company completed a Stock Exchange Program that offered each of its directors and employees who held options under the Option Plan with an exercise price of greater than $10.00 the opportunity to surrender those options for cancellation in exchange for new options to be granted approximately six months and one day after cancellation. Approximately 81,684 options were exchanged under this program, and the Company granted 81,684 new options on September 20, 2002. As of March 18, 2003, options to purchase 378,173 shares (net of forfeitures) had been granted under the Option Plan, leaving 12,829 shares available for future grants. The number of shares reserved under the Option Plan is subject to adjustment in the event of stock dividends, stock splits, recapitalizations, and similar events. The primary purpose of the Option Plan is to secure and retain employees and directors by giving them an opportunity to invest in the future success of the Company.

        The proposed amendment of the Option Plan, if approved by the shareholders of the Company, would increase from 516,667 to 816,667 the number of shares available for grants of options under the Option Plan. If the amendment of the Option Plan is approved, the Company will have 312,829 shares available for future grants under the Option Plan. Options to purchase shares of Common Stock reserved for issuance under the Option Plan may be granted to employees (93 persons as of March 18, 2003), including executive officers (five persons), and to non-employee directors (four persons).

Description of the Option Plan

        The Option Plan is administered by a committee of the Board of Directors made up of at least two members. The Board of Directors will consider the advisability of complying with the disinterested standards contained in Section 162(m) of the Internal Revenue Code (the "Code") and in Rule 16(b)(3) (promulgated under the Securities Exchange Act of 1934) when appointing members. The Compensation Committee of the Board of Directors presently serves in this capacity.

        The Compensation Committee selects the individuals to receive options, determines the type of option granted, the number of shares subject to an option and the other terms and conditions of an option consistent with the provisions of the Option Plan; provided, however, that all terms and conditions of the grants of options to directors, as described below, are determined by the provisions of the Option Plan. No employee, however, may be granted during any single fiscal year of the Company the rights to shares of Common Stock under options and stock appreciation rights which, in the aggregate, exceed 100,000 shares of Common Stock. The Compensation Committee also interprets the provisions of the Option Plan and may prescribe, amend and rescind rules and regulations relating to it. The Compensation Committee is also under certain circumstances authorized to delegate to one or more officers of the Company authority to grant options to any prospective optionee who is not and will not at the time of the option grant be a "reporting person" for purposes of Section 16 of the Securities Exchange Act of 1934.

        Options granted pursuant to the Option Plan are nontransferable except by will or the laws of descent and distribution. The exercise price of each option granted may be paid in cash or, if the optionee's agreement so provides, in shares previously owned by the optionee, by any combination of shares and cash or by means of a "cashless exercise" through a broker. The term of an incentive stock option may not exceed ten years from the date of grant and the exercise price of an incentive stock

15


option may not be less than the fair market value of the Common Stock on the date of grant (or less than 110% of the fair market value if the optionee owns more than 10% of the outstanding Common Stock).

        Options granted under the Option Plan are exercisable in such amounts, at such intervals and upon such terms as the Compensation Committee shall provide in written agreements reflecting the options, subject to certain limitations specified in the Option Plan.

        Each non-management director is eligible to receive an option to acquire 1,667 shares of the Common Stock annually if they continue in service through their respective service anniversary dates (as described in the Option Plan). Each newly appointed non-management director is eligible to receive an initial option to acquire 6,667 shares of the Common Stock on the date of appointment. These grants of options to directors have a term of ten years and become exercisable in annual one-fourth increments following the date of grant and have a per share exercise price equal to the fair market value of a share of Common Stock determined as of the option grant date.

        Prior to certain changes of control of the Company, unless the surviving entity agrees to assume the options, provisions shall be made to cause each outstanding option to become fully exercisable prior to the change in control and to terminate upon consummation of the transaction or event causing the change in control.

        For additional information concerning the number and type of options issued pursuant to the Option Plan through the end of 2002, see "Executive Compensation—Table I—Summary Compensation Table" and "—Table II—Option Grants in 2002." For additional information concerning option exercises in 2002, see "Executive Compensation—Table III—Aggregated Option Exercises in 2002 and 2002 Year-End Option Values." As of March 18, 2003, the closing sale price of a share of Common Stock reported on the Nasdaq SmallCap Market was $12.21

        Set forth below is the number of incentive and non-qualified options that had been granted to certain employees and certain groups of employees or directors and remained outstanding as of December 31, 2002.

Name
 Incentive Options
Granted(1)
 Non-Qualified
Options Granted(1)
Richard T. Brock 9,084 8,334
Debbie N. Qaqish 15,000 —
David R. Simmons 25,000 —
Judith A. Vitale 17,981 —
All executive officers as a group (4 persons) 67,065 8,334
All directors who are not Executive officers as a group (4 persons) — 40,005
All non-executive employees as a group (71 persons) 240,628 566
(1)
Options granted to executive officers and non-executive employees become exercisable in 25% increments on the first, second, third and fourth anniversaries of the date of grant. All of the options granted expire ten years from the date of grant or earlier if the optionee dies or ceases to be employed by the Company.

16

Equity Compensation Plan Information

        The table below contains certain information regarding our equity compensation plans as of the end of 2002.

 
 (a)
 (b)
 (c)
 
Plan Category
 Number of
securities to
be issued
upon exercise
of outstanding
options, warrants
and rights
 Weighted-
average exercise
price of
outstanding
warrants and rights
 Number of
securities
remaining available
for future issuance
under equity
compensation plans
(excluding securities
reflected in column(a))
 
Equity compensation plan approved by security holders:        
 Stock Option Plan 356,598 $5.93 49,983(1)
 Employee Stock Purchase Plan —(2)$—(2)17,761 
Equity compensation plan not approved by security holders:        
 Warrants 18,667(3)$2.81 0 
  
    
 
Total 375,265    67,744 
(1)
Excludes the proposed increase of 300,000 shares in the aggregate number of shares of common stock available for issuance under the Amended Stock Plan, which is subject to shareholder approval as described in this proxy statement.

(2)
We maintain an Employee Stock Purchase Plan that permits employees who have worked full-time for us for at least six months to have payroll deductions made to purchase shares of our common stock during specified purchase periods. The purchase price is 85% of the fair market value per share of our common stock on the last business day of the purchase period. Consequently, we do not know the number of shares or the price at which shares will be purchased for any purchase periods that are currently in effect.

(3)
Represents warrants issued to Silicon Valley Bank on December 19, 2000 related to the issuance of a Line of Credit Agreement. These warrants expire December 19, 2005.

New Plan Benefits

        The table below outlines certain awards proposed to be issued in 2003 if the Amended Stock Plan is approved by our stockholders.

Name and Position
 Dollar
Value(1)
 Number of
Units
 
Executive Officers 0 30,000(2)
Non-executive employee 0 5,000(3)
(1)
Options will be issued with an exercise price equal to the fair market value of a share of common stock determined as of the date the options are granted.

(2)
Represents options proposed to be issued to two individuals who became Executive Officers of Firstwave in connection with Firstwave's acquisition of Connect Care, Inc. in March, 2003. 10,000 options will vest over a one-year period and 20,000 options will vest over a 4-year period.

(3)
Options will vest over 4 years

17

        It is anticipated that if the Amended Stock Plan is approved by our stockholders, additional stock option awards will be issued in 2003. Because the amount of awards to be received by any participant in the Amended Stock Plan is determined by our compensation committee in its discretion, the amount of future awards to be granted to any person or group of persons (other than those listed above) is not currently determinable.

        The following discussion outlines generally the federal income tax consequences of participation in the Option Plan. Individual circumstances may affect these results. The federal income tax law and regulations are frequently amended, and each participant should rely on his or her own tax counsel for advice regarding federal income tax treatment under the Option Plan.

        Non-qualified Stock Options.    The recipient of a non-qualified option under the Option Plan is not subject to any federal income tax upon the grant of such option nor does the grant of the option result in an income tax deduction for the Company. As a result of the exercise of an option, the recipient generally will recognize ordinary income in an amount equal to the excess, if any, of the fair market value of the shares transferred to the recipient upon exercise over the exercise price. Such fair market value generally will be determined on the date the shares of Common Stock are transferred pursuant to the exercise. However, if the recipient is subject to Section 16(b) of the Exchange Act, the date on which the fair market value of the shares transferred is determined will be the earlier of the last day of the six-month period beginning on the date the "property" is "purchased" or the first day on which a sale of the "property purchased" will not subject the recipient to suit under Section 16(b) of the Exchange Act. Alternatively, if such a recipient makes a timely election under Section 83(b) of the Code, such fair market value will be determined on the date the shares are transferred pursuant to the exercise without regard to the effect of Section 16(b) of the Exchange Act. The recipient will recognize ordinary income in the year in which the fair market value of the shares transferred is determined. The Company generally will be entitled to a federal income tax deduction equal to the amount of ordinary income recognized by the recipient when such ordinary income is recognized by the recipient, provided the Company satisfied applicable federal income tax withholding requirements.

        Depending on the period the shares of Common Stock are held after exercise, the sale or other taxable disposition of shares acquired through the exercise of a non-qualified option generally will result in a short- or long-term capital gain or loss equal to the difference between the amount realized on such disposition and the fair market value of such shares when the non-qualified option was exercised.

        Special tax rules apply to a recipient who exercises a non-qualified option by paying the exercise price, in whole or in part, by the transfer of shares of Common Stock to the Company.

        Incentive Stock Options.    The recipient of an incentive stock option is not subject to any federal income tax upon the grant of such an option pursuant to the Option Plan, nor does the grant of an incentive stock option result in an income tax deduction for the Company. Further, a recipient will not recognize income for federal income tax purposes and the Company normally will not be entitled to any federal income tax deduction as a result of the exercise of an incentive stock option and the related transfer of shares of Common Stock to the optionee. However, the excess of the fair market value of the shares transferred upon the exercise of the incentive stock option over the exercise price for such shares generally will constitute an item of alternative minimum tax adjustment to the optionee for the year in which the option is exercised. Thus, certain optionees may increase their federal income tax liability as a result of the exercise of an incentive stock option under the alternative minimum tax rules of the Code.

        If the shares of Common Stock transferred pursuant to the exercise of an incentive stock option are disposed of within two years from the date the option is granted or within one year from the date

18


the option is exercised, the optionee generally will recognize ordinary income equal to the lesser of (i) the gain recognized (i.e., the excess of the amount realized on the disposition over the exercise price) or (ii) the excess of the fair market value of the shares transferred upon exercise over the exercise price for such shares. If the optionee is subject to Section 16(b) of the Exchange Act, special rules may apply to determine the amount of ordinary income recognized upon the disposition. The balance, if any, of the optionee's gain over the amount treated as ordinary income on disposition generally will be treated as long- or short-term capital gain depending upon whether the holding period applicable to long-term capital assets is satisfied. The Company normally would be entitled to a federal income tax deduction equal to any ordinary income recognized by the optionee, provided the Company satisfies applicable federal income tax withholding requirements.

        If the shares of Common Stock transferred upon the exercise of an incentive stock option are disposed of after the holding periods have been satisfied, such disposition will result in a long-term capital gain or loss with respect to the difference between the amount realized on the disposition and the exercise price. The Company will not be entitled to a federal income tax deduction as a result of a disposition of such shares after these holding periods have been satisfied.

Required Vote

        The affirmative vote of the shareholders having a majority of the voting power of all shares present, in person or by proxy, and voted at the Annual Meeting, is required to approve Proposal 2.

THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS
VOTE IN FAVOR OF THE AMENDMENT TO THE OPTION PLAN


OTHER MATTERS


The Board of Directors knows of no other matters to be brought before the Annual Meeting. However, if any other matters are properly brought before the Annual Meeting, the persons appointed in the accompanying proxy intend to vote the shares represented thereby in accordance with their best judgment.


SOLICITATION OF PROXIES

The cost of the solicitation of proxies on behalf of the Company will be borne by the Company. Certain directors, officers, and other employees of the Company may, without additional compensation except reimbursement for actual expenses, solicit proxies by mail, in person or by telecommunication. The Company will reimburse brokers, fiduciaries, custodians, and other nominees for out-of-pocket expenses incurred in sending the Company'sCompany’s proxy materials to, and obtaining instructions relating to such materials from, beneficial owners.


Furthermore, we will engage Morrow & Co., Inc., of 470 West Avenue, Stamford, CT 06902, INDEPENDENT ACCOUNTANTS
www.morrowco.com

, to help solicit proxies. The Board of Directors has reappointed Cherry, Bekeart & Holland L.L.P. asanticipated cost is estimated at $15,000, which will be borne by the Company's independent accountants for 2003. A representative of this firm is expectedCompany. The extent to attend the Annual Meeting to respond to questions from shareholders and to make a statement if he so desires.

        On October 1, 2001, the Audit Committee of the Board of Directors of Firstwave Technologies, Inc. approved the engagement of Cherry, Bekaert & Holland L.L.P. as the Company's independent accountants for the fiscal year ending December 31, 2001, and dismissed PricewaterhouseCoopers L.L.P.

        There were no disagreements with PricewaterhouseCoopers L.L.P. within the meaning of Instruction 4 of Item 304 of Regulation S-K as to any matter of accounting principles or practices,

19


financial statement disclosure, or auditing scope or procedure in connection with the audits of the Company's financial statements for the fiscal years ended December 31, 2000 and December 31, 1999, or for any subsequent interim period through June 30, 2001, which disagreements if not resolved to its satisfaction would have caused PricewaterhouseCoopers L.L.P. to make reference to the subject matter of the disagreement in their report on the Company's consolidated financial statements for such years.

        The reports of PricewaterhouseCoopers L.L.P. on the Company's consolidated financial statements for the past two fiscal years did not contain an adverse opinion or a disclaimer of opinion nor were such reports qualified as to audit scope or accounting principles. The report of PricewaterhouseCoopers L.L.P. on the Company's consolidated financial statements for the fiscal year ending December 31, 2000 included an explanatory paragraph relating to the Company's ability to continue as a going concern.

        In 2002, the Company was billed the following fees by Cherry, Bekeart & Holland L.L.P. and PricewaterhouseCoopers L.L.P.

our proxy solicitation firm must solicit proxies depends entirely upon how soon proxy cards are returned.

15

Audit Fees

        Cherry, Bekeart & Holland L.L.P. billed the Company $41,735 for audit-related services in 2002.

Financial Information Systems Design and Implementation Fees

        No fees were billed to the Company by PricewaterhouseCoopers L.L.P. or Cherry, Bekeart & Holland L.L.P. for financial information systems design implementation services in 2002.

All other Fees

        Cherry, Bekeart & Holland L.L.P. billed $8,000 for non-audit related services in 2002 which represented fees associated with the preparation of the Company's annual income tax return. PricewaterhouseCoopers L.L.P. billed $3,500 for non-audit-related services in 2002 related to their consent of the usage of their report dated April 16, 2001 in the financial statements for the year ended December 31, 2001.

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REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS


The Audit Committee of the Company'sCompany’s Board of Directors is composed of three members and acts under a written charter first adopted and approved on March 29, 2001.2001 and revised on February 5, 2004. The members of the Audit Committee are independent directors, as defined by its charter and the rules of The NasdaqNASDAQ Stock Market. The Chairman of the Audit Committee reviewedfulfills the Company'srole of financial expert as defined by the United States Securities and Exchange Commission.

The Audit Committee read the Company’s audited financial statements for the fiscal year ended December 31, 2002,2005, and discussed these financial statements with the Company'sCompany’s management. The Audit Committee also reviewed and discussed the audited financial statements and the matters required by Statement on Auditing Standards 61 (Communication with Audit Committees)(Codification of Statements on Auditing Standards, AU Section 380) with Cherry, BekeartBekaert & Holland L.L.P., the Company'sCompany’s independent accountants. In addition, the Audit Committee has received the written disclosures and the letter from the independent accountants required by Independence Standards Board Standard No. 1 (Independence Discussions with Audit Committees) and has discussed with the independent accountants their independence from the Company. The Audit Committee also considered whether the independent accountants'accountants’ provision of certain other, non-audit related services to the Company is compatible with maintaining such accountants'accountants’ independence. Based on its discussions with management and the independent accountants, and its review of the representations and information provided by management and the independent accountants, the Audit Committee recommended to the Company'sCompany’s Board of Directors that the audited financial statements be included in the Company'sCompany’s Annual Report on Form 10-K for the year ended December 31, 2002.

THE AUDIT COMMITTEE
OF THE BOARD OF DIRECTORS
Roger A. Babb
James R. Porter
John F. Keane, Chairman

2005.

                        THE AUDIT COMMITTEE
                        OF THE BOARD OF DIRECTORS
                        Roger A. Babb
                        I. Sigmund Mosley
                        John N. Spencer, Jr. Chairman

16
INDEPENDENT ACCOUNTANTS

The Audit Committee of the Board of Directors has reappointed Cherry, Bekaert & Holland L.L.P. as the Company’s independent accountants for 2006. A representative of this firm is expected to attend the Annual Meeting to respond to questions from shareholders and to make a statement if he so desires.
For the years ended December 31, 2005 and December 31, 2004, the Company was billed the following fees in the aggregate by Cherry, Bekaert & Holland L.L.P.
    2005 2004 
Audit Fees  
(1
)
$41,650 $62,667 
Tax Fees  
(2
)
 9,900  23,331 
All Other Fees  
(3
)
 6,221  - 
Total    $57,771 $85,998 
_______________
(1) Audit fees represent fees for professional services provided in connection with the audit of annual financial statements and review of quarterly financial statements and audit services provided in connection with other statutory or regulatory filings.
(2) Tax fees consisted of fees for tax compliance services related to preparation of returns and responses to inquiries from tax authorities on the Company’s tax filings.
(3) Other fees represent fees for S-8 filings and work associated with the sale of the UK Subsidiary.

In 2005, the Audit Committee pre-approved 100% of all audit services performed by the independent accountants. There were no hours expended, billed or performed by any persons other than the full time, permanent employees of the independent accountants.
SHAREHOLDER PROPOSALS FOR ANNUAL MEETING TO BE HELD IN 20042007

             Any proposal that a shareholder may desire to have included in the Company'sCompany’s proxy material for presentation at the Annual Meeting to be held in 20042007 must be received by the Company at its executive offices at 2859 Paces Ferry Road,5775 Glenridge Drive, Suite 1000,E400, Atlanta, Georgia 30339,30328, Attention: Mr. Richard T. Brock, on or prior to December 1, 2003.

2006, or such proposal will be considered untimely.


               The proxy or proxies designated by the Company will have discretionary authority to vote on any matter properly presented by a shareholder for consideration at the Annual Meeting of Shareholders to be held in 20042007, but not submitted for inclusion in the proxy materials for such meeting unlessif notice of the matter is received by the Company at its principal executive office not later than February 15, 20042007 and certain other conditions of the applicable rules of the SEC are satisfied.

SHAREHOLDER COMMUNICATIONS WITH DIRECTORS

Shareholders may contact the Board of Directors of Firstwave Technologies, Inc. via:
·      correspondence mailed to 5775 Glenridge Drive, Suite E400, Atlanta, Georgia 30328 Attn: Richard T. Brock
·      
email to Richard Brock, Chairman of the Board at rbrock@firstwave.net
·      telephone at 770-250-0349

All communications will be compiled by the Chairman of the Board and submitted to the Board or the individual directors on a periodic basis.
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ANNUAL REPORT

The Company's 2002Company’s 2005 Annual Report to Shareholders is being mailed to the Company'sCompany’s shareholders with this Proxy Statement.

April 1, 2003 Any shareholder who has not received a copy of the Annual Report may obtain a copy by writing to the Secretary of the Company. The Annual Report is not to be treated as a part of the proxy solicitation material or as having been incorporated herein by reference.


Atlanta, Georgia

21

FIRSTWAVE TECHNOLOGIES, INC.FORM 10-K


THIS PROXY IS SOLICITEDA COPY OF THE COMPANY’S ANNUAL REPORT ON BEHALFFORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2005, WILL BE FURNISHED WITHOUT CHARGE TO SHAREHOLDERS AS OF
THE RECORD DATE FOR THE ANNUAL MEETING UPON WRITTEN REQUEST TO THE COMPANY’S SECRETARY OR CHAIRMAN OF THE BOARD OF DIRECTORS OF FIRSTWAVE TECHNOLOGIES, INC.AT 5775 GLENRIDGE DRIVE, SUITE E400, ATLANTA, GEORGIA 30328.

        The undersigned shareholder (s) of Firstwave Technologies, Inc., a Georgia Corporation (the "Company"), hereby acknowledges receipt of the Notice of Annual Meeting of Shareholders and Proxy Statement, each dated April 1, 2003, and hereby appoints Richard T. Brock or Judith A. Vitale proxies and attorneys-in-fact, with full power of substitution, on behalf and in the same name of the undersigned, to represent the undersigned at the 2003 Annual Meeting of Shareholders of the Company to be held at 2:00 p.m. on Thursday, May 1, 2003, at the Corporate Offices of Firstwave Technologies Inc., 2859 Paces Ferry Road, Suite 1000, Atlanta, Georgia, 30339, and at any adjournment (s) or postponement(s) thereof, and to vote all shares of Common Stock which the undersigned would be entitled to vote if then and there personally present, on the matters set forth below:

(1)
Election of Directors

oFOR all nominees listed below (except as indicated otherwise below)oWITHHOLD AUTHORITYto vote for all nominees listed below

NOMINEES:Roger A. Babb, Richard T. Brock, Richard D. Jackson, John F. Keane, and Alan I. Rothenberg

INSTRUCTIONS:To withhold authority for any individual nominee, mark "FOR" above and write the name of the nominee for whom you wish to withhold authority in the space provided below:

(2)
Amendment of the Company's 1993 Stock Option Plan to increase the number of shares reserved for future grants under the plan from 516,667 to 816,667.

        oFOR                                      oAGAINST                                      oABSTAIN

(3)
In their discretion, to transact such matter or matters which may properly come before the meeting or any adjournment(s) thereof.

PLEASE COMPLETE, DATE, SIGN AND RETURN THIS PROXY PROMPTLY. This Proxy, when properly executed, will be voted in accordance with the directions given by the undersigned shareholder(s). If no direction is made, it will be voted FOR the items listed (1) and (2) and as the proxies deem advisable on such other matters as may come before the meeting.

 Dated, 2003
BY ORDER OF THE BOARD OF DIRECTORS
  
 
 
Richard T. Brock
Chairman and Chief Executive Officer
  



Signature



Signature (if held jointly)
Title of authority (if applicable)

NOTE: Please sign exactly as name appears hereon. If shares are registered in more than one name, the signature of all persons is required. A corporation should sign its full corporate name by a duly authorized officer, stating his or her title. Trustees, guardians, executors and administrators should sign in their official capacity, giving their full title as such. If a partnership, please sign in the partnership name by an authorized person.



QuickLinks

March 29, 2006
Atlanta, Georgia
PROXY STATEMENT18
SHARES ENTITLED TO VOTE AND RELATED MATTERS

PROPOSAL 1—ELECTION OF DIRECTORS

BENEFICIAL OWNERSHIP OF COMMON STOCK
EXECUTIVE COMPENSATION
COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN* AMONG FIRSTWAVE TECHNOLOGIES, INC., THE RUSSELL 2000 INDEX AND THE RUSSELL 2000 TECHNOLOGY SECTOR INDEX
PROPOSAL 2—AMENDMENT OF THE COMPANY'S 1993 STOCK OPTION PLAN
OTHER MATTERS
SOLICITATION OF PROXIES
INDEPENDENT ACCOUNTANTS
REPORT OF THE AUDIT COMMITTEE OF THE BOARD OF DIRECTORS
SHAREHOLDER PROPOSALS FOR ANNUAL MEETING TO BE HELD IN 2004
ANNUAL REPORT