<PAGE>   1



 
 
                                                                      EXHIBIT 13

















                                      56
<PAGE>   2
                                                                    EXHIBIT 13


------------------------------------------------------------------------------

                          Firstwave Technologies, Inc.




                                     ANNUAL

                                REPORT    [LOGO]





















                                      1997
<PAGE>   3
------------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
------------------------------------------------------------------------------

------------------------------------------------------------------------------
SELECTED FINANCIAL DATA

FIRSTWAVE TECHNOLOGIES, INC.

<TABLE>
<CAPTION>

Year Ended December 31,                          1997       1996       1995       1994      1993  

(In thousands, except per share data)                                    
-------------------------------------------------------------------------------------------------
<S>                                          <C>        <C>        <C>        <C>        <C>
Net revenues                                 $ 15,848   $ 23,222   $ 28,001   $ 30,697   $ 25,465
Income (loss) before taxes                     (1,377)   (10,115)    (4,928)       737      4,407
Income tax (provision) benefit                   (133)     1,055      1,837       (192)    (1,549)
Net income (loss)                              (1,510)    (9,060)    (3,091)       545      2,858
Basic net income (loss) per common share        (0.30)     (1.81)     (0.63)       .11        .69
Diluted net income (loss) per common share      (0.30)     (1.81)     (0.63)       .11        .66
Total assets                                   14,286     18,367     26,045     29,127     27,591
Total non-current liabilities                $      -   $    125   $      -   $    960    $   906
Weighted average common and
   common share equivalents                     5,035      5,000      4,932      4,960      4,339
</TABLE>


<TABLE>
<CAPTION>
                                        ------------------------------------------------------------
                                        CONTENTS
                                        ------------------------------------------------------------
                                        
                                        <S>                                                        <C>
                                        Letters to Shareholders....................................2
      
                                        Condensed Balance Sheet....................................4

                                        Condensed Statement of Operations..........................5

                                        Condensed Statement of Changes in Shareholders' Equity.....6

                                        Report of Independent Accountants..........................6

                                        Condensed Statement of Cash Flow...........................7

                                        Board of Directors and Officers............................8

                                        Shareholder Information....................Inside Back Cover
</TABLE>



                                             First Wave Technologies, Inc.     1
<PAGE>   4
--------------------------------------------------------------------------------
LETTER TO SHAREHOLDERS
--------------------------------------------------------------------------------

I am pleased to report significant progress in the pivotal first year of our
company's transformation. We have revitalized the business to begin 1998 with
stable operations, a bright future, and aggressive plans for expansion. In
support of these plans, we changed the company's name to Firstwave Technologies,
Inc. on March 1, 1998.


A YEAR OF TRANSFORMATION

In 1997 Brock began implementing a two-year turnaround plan designed to
stabilize operating performance, restore financial health, and stimulate
long-term growth. Early in the year, we restructured operations to reduce
overhead and eliminate unproductive activities. We enforced rigorous financial
discipline and managed the balance sheet carefully. Throughout the year, we
strengthened customer relationships by dedicating staff to customer care and
delivering improved products and services. While reducing overall expenses
significantly, we increased research and development investment 34 percent,
including in-process R&D. We enhanced our products with technical advances,
interfaces to the World Wide Web, new features for multi-national companies, new
capabilities to facilitate team selling, and Year 2000 compliance. We assembled
a strong management team who analyzed our markets, studied the competition,
explored emerging technologies, and developed growth strategies. At year-end, we
acquired Netgain Corp., an innovative young company with revolutionary
technology.


FINANCIAL RESULTS

Financial performance met or exceeded expectations in each quarter of 1997.
Excluding a one-time charge related to the Netgain acquisition, the company
posted consecutive quarterly operating profits in the second half of the year.
We reported the first year-over-year quarterly revenue growth in the fourth
quarter as license revenues surged 41 percent over the fourth quarter of 1996. I
believe these results signaled the transition from quarterly decline to growth -
a key indicator of financial turnaround. 


As anticipated, annual revenues of $15.8 million were lower than the $23.2
million reported in 1996. Due to operating efficiencies, the net loss of $1.5
million ($.30 per share) was a major improvement over 1996. The client services
team performed especially well after restructuring. Consulting staff utilization
consistently exceeded 75 percent with gross margins greater than 20 percent.
Maintenance revenues grew and customer retention improved by 20 percent as
implementation success and customer satisfaction increased. The balance sheet
reflects the strength of a smaller, healthier company with a secure cash
position and a solid foundation for future growth.


CURRENT PRODUCT STRATEGY

We will continue improving the existing business while investing in expansion
strategies to stimulate growth. The revenue streams and customer relationships
of our existing business provide a sound platform for launching new products and
services. We remain dedicated to the thousands of people who depend on us around
the world, and we will continue to support and enhance the products we are
selling today. These full-featured products optimize sales, marketing, and
customer service functions for major companies in 20 countries. We will maintain
the Unix products, provide award-winning TakeControl(R) client/server
applications, offer Year 2000 upgrades, remain compatible with the most popular
database managers and operating systems, and provide personal service whenever
customers need it. 





2         Firstwave Technologies, Inc.
<PAGE>   5
-------------------------------------------------------------------------------

NETGAIN(TM) STRATEGY

We plan to propel growth with innovative products based on the advanced Netgain
architecture.  In conjunction with a new corporate identity campaign, we are
launching Netgain Enterprise(TM), the first commercial customer information
system designed specifically to leverage Internet technologies.  The present
generation of competitive products in our marketplace was built with early
client/server technology to automate direct sales forces and other internal
corporate departments.  Due to technical limitations, these products have
little utility for the fast-growing class of companies who sell through
multiple channels and business partners.  Netgain is ideally suited to the needs
of these progressive organizations because it is designed to support and
integrate all revenue functions of an "extended enterprise".

We anticipate mid-1998 shipments of the first product in the suite, Netgain
Sales(TM). This product is designed to help professional salespeople manage
contacts, accounts, opportunities, and activities with minimum effort for
maximum effectiveness.  Modeled after the most creative web applications,
Netgain Sales is highly intuitive and easy to learn and use.  Any authorized
user can securely access the system through a standard web browser.  In
addition to a customer's own sales and marketing staffs, Netgain users can
include distributors, resellers, system integrators, and other partners anywhere
in the world.  As a centrally managed system, Netgain can boost competitive
advantage.  It speeds enterprise-wide access to critical sales information,
enables team collaboration, and provides valuable management insights.  the
architecture facilitates simple installation and maintenance and quick
adaptation to changing business needs.

Netgain's unique advantage is increased sales effectiveness throughout the
extended enterprise, and the total cost of ownership is less than conventional
alternatives. We believe this product is the forerunner of a new era.

FIRSTWAVE(TM)

The new corporate identity supports our position of leadership.  Existing stock
certificates remain in effect and the stock continues to trade on the NASDAQ
National Market, with a new symbol (FSTW). In Firstwave, we have formed a
dynamic new company - combining the entrepreneurial spirit and Internet
expertise of Netgain with the applications expertise and global resources of
Brock. Because of our heritage, Firstwave has a rare ability to understand
customer needs and apply emerging technologies to enhance revenues.

Thanks to our customers, employees, and friends of the company, 1997 was the
turning point we planned.  We appreciate the many people who contributed to our
success.  In particular, I would like to recognize the selfless service of two
directors whose contributions spanned five years: Harry Gruner left our board
in December and Said Mohammadioun will complete his service in May.  In their
places, we are honored to nominate two respected information technology
industry leaders for election at the annual meeting. The insights of John
Keane and Tom McNeight will be invaluable in transforming the company into a
growth leader. On behalf of the board and all the people of our company, I thank
you for your continued confidence.

                                   Sincerely,


                                   /s/ Doug MacIntyre
                                   -------------------------------------
                                   R. Douglas MacIntyre
                                   President and Chief Executive Officer





                                   Firstwave Technologies, Inc.                3
<PAGE>   6
--------------------------------------------------------------------------------
CONDENSED BALANCE SHEET
--------------------------------------------------------------------------------


<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------------------------
(In thousands, except share and per share data)                                        December 31,
-------------------------------------------------------------------------------------------------------------
                                                                                  1997                   1996
-------------------------------------------------------------------------------------------------------------
<S>                                                                            <C>                    <C>
ASSETS
Current Assets      
   Cash and cash equivalents                                                   $   174                $ 1,104
   Marketable securities                                                         4,795                  5,843
   Accounts receivable, less allowance for doubtful
      accounts of $703 and $1,971                                                3,047                  4,120
   Deferred tax asset                                                              459                    834
   Prepaid expenses and other                                                      177                    130
-------------------------------------------------------------------------------------------------------------
      Total current assets                                                       8,652                 12,031
Property and equipment, net                                                      1,938                  2,906
Software development costs, net                                                  1,089                  1,508
Intangible asset                                                                   245                      -
Deferred tax asset                                                               2,362                  1,922
                                                                               $14,286                $18,367
-------------------------------------------------------------------------------------------------------------

LIABILITIES AND SHAREHOLDERS' EQUITY
-------------------------------------------------------------------------------------------------------------
Current liabilities                          
   Line of credit                                                              $     -                $ 1,975
   Current portion of note payable                                                   -                     83
   Accounts payable                                                                868                  1,012
   Accrued restructuring costs                                                     325                  1,111
   Sales tax payable                                                               263                    378
   Deferred revenue                                                              1,545                  1,464
   Accrued employee compensation and benefits                                      614                    680
   Other accrued liabilities                                                        19                     97
-------------------------------------------------------------------------------------------------------------
      Total current liabilities                                                  3,634                  6,800
Note Payable                                                                         -                    125
Common stock subject to repurchase                                                 300                      -
                                                                                 3,934                  6,925
-------------------------------------------------------------------------------------------------------------
Shareholders' equity
-------------------------------------------------------------------------------------------------------------
   Preferred stock, no par, 1,000,000 shares
      authorized and no shares issued or outstanding
   Common stock, stated value $ 0019 per share; 10,000,000
      shares authorized; 5,033,027 and 4,936,555 shares issued              
      and outstanding                                                                9                      9
   Additional paid-in capital                                                   19,329                 18,909
   Unrealized loss on marketable securities                                        (14)                   (14)
   Retained deficit                                                             (8,972)                (7,462)
                                                                                10,352                 11,442
-------------------------------------------------------------------------------------------------------------
                                                                               $14,286                $18,367
-------------------------------------------------------------------------------------------------------------
</TABLE>                                                                    
                                                                            
4         Firstwave Technologies, Inc.                                      
                                                                            

                                                            
<PAGE>   7
<TABLE>
<CAPTION>

--------------------------------------------------------------------------------------------------------
CONDENSED STATEMENT OF OPERATIONS
--------------------------------------------------------------------------------------------------------


--------------------------------------------------------------------------------------------------------
(In thousands, except per share amounts)                              For the year ended December 31,
--------------------------------------------------------------------------------------------------------
                                                                    1997            1996            1995
--------------------------------------------------------------------------------------------------------
<S>                                                              <C>             <C>            <C>
NET REVENUES
  Software                                                       $ 5,239         $ 9,834        $ 11,720               
  Services                                                         4,810           7,267           9,717
  Maintenance                                                      5,189           5,143           5,104
  Other                                                              610             978           1,460
--------------------------------------------------------------------------------------------------------
                                                                  15,848          23,222          28,001
--------------------------------------------------------------------------------------------------------
COST AND EXPENSES
  Cost of revenues
     Software                                                        675           4,883           2,477
     Services                                                      3,528           5,908           7,968
     Maintenance                                                   1,687           2,002           2,014
     Other                                                           606             895           1,419
  Sales and marketing                                              6,012          10,083          12,045
  Product development                                              2,003           2,010           1,794
  General and administrative                                       2,186           6,027           5,625
  In process research and development                                696               -               -
  Restructuring costs                                                  -           1,598               -
--------------------------------------------------------------------------------------------------------
     Operating loss                                               (1,545)        (10,184)         (5,341)
Interest expense                                                     (40)           (156)            (74)
Interest income                                                      208             225             487
--------------------------------------------------------------------------------------------------------
Loss before income taxes                                          (1,377)        (10,115)         (4,928)
Income tax benefit (provision)                                      (133)          1,055           1,837
--------------------------------------------------------------------------------------------------------
Net loss                                                         $(1,510)        $(9,060)       $ (3,091)
--------------------------------------------------------------------------------------------------------   
Net loss per share
  Basic                                                          $ (0.30)        $ (1.81)       $   (.63)
  Diluted                                                        $ (0.30)        $ (1.81)       $   (.63)
--------------------------------------------------------------------------------------------------------   
</TABLE>



                                              Firstwave Technologies, Inc.     5
<PAGE>   8
-------------------------------------------------------------------------------
CONDENSED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
--------------------------------------------------------------------------------


<TABLE>
<CAPTION>
--------------------------------------------------------------------------------
(In thousands, except share data)
--------------------------------------------------------------------------------
                                                                                                UNREALIZED
                                                                            ADDITIONAL           LOSS ON       RETAINED
                                                      COMMON STOCK             PAID-IN          MARKETABLE     EARNINGS
                                                  SHARES         AMOUNT        CAPITAL          SECURITIES    (DEFICIT)      TOTAL
<S>                                            <C>               <C>        <C>                 <C>            <C>          <C>
-----------------------------------------------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1994                   4,874,671           $ 9        $ 18,507              $ (261)    $ 4,689      22,944
-----------------------------------------------------------------------------------------------------------------------------------
Exercise of common stock options                  17,564             -             140                   -           -         140  
Employee stock purchases                          16,580             -              97                   -           -          97
Unrealized gain on marketable securities               -             -               -                 140           -         140
Net loss                                               -             -               -                   -      (3,091)     (3,091)
-----------------------------------------------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1995                   4,908,815             9          18,744                (121)      1,598      20,230
----------------------------------------------------------------------------------------------------------------------------------- 
Exercise of common stock options                   9,242             -              59                   -           -          59
Employee stock purchases                          18,498             -             106                   -           -         106
Unrealized gain on marketable securities               -             -               -                 107           -         107
Net loss                                               -             -               -                   -      (9,060)     (9,060)
-----------------------------------------------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1996                   4,936,555             9          18,909                 (14)     (7,462)     11,442
----------------------------------------------------------------------------------------------------------------------------------- 
Exercise of common stock options                  88,899             -             281                   -           -         281
Employee stock purchases                           7,573             -              25                   -           -          25
Issuance of stock options                              -             -             114                   -           -         114
Net loss                                               -             -               -                   -      (1,510)     (1,510)
-----------------------------------------------------------------------------------------------------------------------------------
BALANCE AT DECEMBER 31, 1997                   5,033,027           $ 9        $ 19,329              $  (14)    $(8,972)    $10,352
-----------------------------------------------------------------------------------------------------------------------------------
</TABLE>




--------------------------------------------------------------------------------
REPORT OF INDEPENDENT ACCOUNTS
--------------------------------------------------------------------------------
TO THE BOARD OF DIRECTORS AND SHAREHOLDERS OF FIRSTWAVE TECHNOLOGIES, INC.


We have audited, in accordance with generally accepted auditing standards, the
financial statements of Firstwave Technologies, Inc. as of December 31, 1997 and
1996 and for each of the three years in the period ended December 31, 1997
appearing under item 14(a)(1) and (2) on page 38 in the Company's Annual Report
on Form 10-K (which statements are not presented herein); and in our report
dated January 30, 1998, except as to note 15 which is as of March 16, 1998, we
expressed an unqualified opinion on those financial statements. In our opinion,
the information set forth in the accompanying condensed balance sheet as of
December 31, 1997 and 1996 and the related condensed statements of operations,
of changes in shareholders' equity and of cash flows for each of the three years
in the period ended December 31, 1997, when read in conjunction with the
financial statements from which it has been derived, is fairly stated in all
material respects in relation thereto.


Price Waterhouse LLP
Atlanta, Georgia
January 30, 1998
except as to note 15 which
is as of March 16, 1998




6         Firstwave Technologies, Inc.

<PAGE>   9
------------------------------------------------------------------------------
CONDENSED STATEMENT OF CASH FLOW
------------------------------------------------------------------------------

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------------
(In thousands)                                                               For the year ended December 31,
----------------------------------------------------------------------------------------------------------------
                                                                          1997             1996        1995
----------------------------------------------------------------------------------------------------------------
<S>                                                                  <C>              <C>            <C>
Cash flows from operating activities               
  Net loss                                                           $ (1,510)        $ (9,060)      $(3,091)
  Adjustment to reconcile net loss to net cash
     provided by operating activities
        Depreciation and amortization                                   1,565            3,431         2,958
        Write down of software development costs to
          net realizable value                                              -            2,583             -
        Write off in process research and development                     696                -             -
        Loss on disposal of fixed assets                                  142              646             -
        Noncash interest on marketable securities                        (194)            (222)         (307)
        Provision of bad debts                                             22            1,837         1,753
        Deferred income taxes                                             (65)          (1,130)       (1,822)
        Stock compensation                                                114                -             -
        Changes in assets and liabilities (net of acquisition)
          (Increase) decrease in accounts receivable                    1,051            2,135        (1,022)
          (Increase) decrease in prepaid expenses and other               (46)              40           584
          Increase (decrease) in accounts payable                        (148)              55          (868)
          Increase (decrease) in accrued restructuring                   (786)           1,111             -
          Increase (decrease) in sales tax payable                       (115)            (225)           36
          Increase (decrease) in deferred revenue                          81             (507)          390
          Increase (decrease) in accrued employee   
            compensation and benefits                                     (66)            (446)            2
          Increase (decrease) in other accrued liabilities                (78)             (46)           47
----------------------------------------------------------------------------------------------------------------
          Total adjustments                                             2,173            9,232         1,751
----------------------------------------------------------------------------------------------------------------
            Net cash provided by (used in) operating activities           663              172        (1,340)
----------------------------------------------------------------------------------------------------------------
Cash flows from investing activities
  Software development costs                                                -           (2,186)       (2,562)
  Acquisition of Netgain                                                 (697)               -             -
  Purchases of property and equipment (net of acquisition)               (261)            (869)       (1,335)
  Purchase of marketable securities                                   (18,513)         (15,710)       (1,661)
  Proceeds from sale of marketable securities                          19,755           18,051         5,261
----------------------------------------------------------------------------------------------------------------
            Net cash provided by (used in) investing activities           284             (714)         (297)
----------------------------------------------------------------------------------------------------------------
Cash flows from financing activities
  Exercise of common stock options                                        281               59           140
  Proceeds from employee stock purchase plan                               25              106            97
  Borrowings under line of credit                                           -            2,990         2,485
  Repayments of borrowings under line of credit                        (1,975)          (2,000)       (1,500)
  Borrowings under note payable                                             -              250             -
  Repayments of note payable                                             (208)             (42)            -
----------------------------------------------------------------------------------------------------------------
           Net cash provided by (used in) financing activities         (1,877)           1,363         1,222
----------------------------------------------------------------------------------------------------------------
Net increase (decrease) in cash                                          (930)             821          (415)
Cash and cash equivalents, beginning of year                            1,104              283           698
----------------------------------------------------------------------------------------------------------------
Cash and cash equivalents, end of year                              $     174          $ 1,104       $   283
----------------------------------------------------------------------------------------------------------------
Supplemental disclosure of cash flow information                 
  Cash paid during the year for interest                            $      84          $   157       $    28       
  Cash paid for income taxes                                        $     198          $    73            56
----------------------------------------------------------------------------------------------------------------
Non-cash investing activities      
  Stock issued in connection with acquisition of Netgain            $     300          $     -       $     -
----------------------------------------------------------------------------------------------------------------
</TABLE>



                         Firstwave Technologies, Inc.                         7
<PAGE>   10

--------------------------------------------------------------------------------
BOARD OF DIRECTORS AND OFFICERS
--------------------------------------------------------------------------------


DIRECTORS

RICHARD T. BROCK, CHAIRMAN
Mr. Brock founded Firstwave Technologies, Inc., formerly Brock International,
Inc., in 1984 to answer the call of businesses needing a solution to automate
their sales, marketing and customer service processes.  Mr. Brock's ideas and
vision helped create an industry that is becoming a top priority of businesses
worldwide.  Mr. Brock also founded and served as chief executive officer of
Management control Systems, Inc., now a division of CLR Professional Software.
Mr. Brock received his master of business administration degree from Louisiana
State University and his bachelor of science degree from Spring Hill College.
Mr. Brock is a Certified Public Accountant.


R. DOUGLAS MACINTYRE
Mr. MacIntyre serves as president and chief executive officer of Firstwave
since joining the company in December 1996.  From 1994 until that time, Mr.
MacIntyre served as president and chief executive officer of Dun & Bradstreet
Software.  From 1990 to 1993, Mr. MacIntyre served as president and chief
operating officer of Software 2000, and from 1980 to 1990 he held management
positions at Management Science America, Inc.  He is past president of the
American Software Association ad serves on various industry and civic boards.
Mr. MacIntyre received his bachelor of science degree from the U.S. Military
Academy at West Point, and a master of science degree in business
administration from Boston University.  He has completed executive programs at
the Harvard, Wharton and Stanford business schools.


MICHAEL T. MCNEIGHT
Mr. McNeight is Vice President of Internet Security Systems, Inc., a software
company providing network security analysis and intrusion detection systems.
Mr. McNeight brings contemporary software industry knowledge and technical
competence.  From 1993 to 1995, he was President and Chief Executive Officer of
Aurum Software, Inc., a software company specializing in sales, marketing and
customer automation.  From 1979 to 1993, Mr. McNeight held management positions
with Dun & Bradstreet Software, Inc.  He received his BA from Oklahoma State
University and his MS from Texas Christian University.


JOHN F. KEANE
Mr. Heane has been a director of the Company since December 1997.  Mr. Keane is
chairman and chief executive officer of Keane, Inc., an application
development, outsourcing and integration services firm.  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 EG&G, a global technology company
that supplies products and technical services to industrial and government
markets.  He is a graduate of Harvard College and Harvard School of Business
Administration.


JAMES R. PORTER
Mr. Porter served from September, 1985, until February, 1997, as president and
chief executive officer of Triad Systems Corporation, a provider of business
and information management solutions for the retail hardlines industry and the
automotive aftermarket, and now serves as Chairman of the Board.  Previously,
her served in executive capacities at Informatics General Corporation and
United Systems International.  Mr. Porter serves on the board of directors for
Silicon Valley Bank, Triad Park LLC and Cellular Technologies.  Mr. Porter
earned his bachelor or science degree in engineering from Texas A&M and
attended Harvard Graduate School of Business.


OFFICERS


R. DOUGLAS MACINTYRE
President and Chief Executive Officer

KENNETH D. BARWICK
Vice President of Worldwide Sales

LISA M. CAMPBELL
Vice President of Marketing

KENNETH (DUTCH) SCHULTZ
vice President of Development

STEPHEN B. SPENCE
Vice President of Client Services

JUDITH A. VITALE
Director of Finance and Administration

8        Firstwave Technologies, Inc.
<PAGE>   11
-------------------------------------------------------------------------------
SHAREHOLDER INFORMATION
-------------------------------------------------------------------------------


CORPORATE HEADQUARTERS
Firstwave Technologies, Inc.
Overlook III, Suite 1000
2859 Paces Ferry Road
Atlanta, Ga 30339

TRANSFER AGENT AND REGISTRAR
First Union of North Carolina 
Shareholder Services Group
Two First Union Center
Charlotte, NC 28288-1154
Information Contact:
Mr. Patrick Edwards
704-383-1973

ANNUAL SHAREHOLDERS MEETING
Thursday, May 7, 1998
from 2:00 p.m. to 3:00 p.m.
Firstwave Technologies, Inc. Corporate Offices
Overlook III, Suite 1000
2859 Paces Ferry Road
Atlanta, Ga 30339
770-431-1200

Corporate Counsel
Powell, Goldstein, Frazer & Murphy LLP
Atlanta, Georgia

FORM 10-K
A copy of the Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997, as filed with the Securities and Exchange Commission, will
be sent to all stockholders.  Additional copies will be sent upon request in
writing to:
Judith A. Vitale
Director of Finance and Administration
Firstwave Technologies, Inc.
Overlook III, Suite 1000
2859 Paces Ferry Road
Atlanta, GA 30339

INDEPENDENT ACCOUNTANTS 
Price Waterhouse LLP
Atlanta, Georgia

STOCK LISTING
NASDAQ Symbol: FSTW
(formerly BROC)

PRODUCT INQUIRIES
For more information about the Company's products and services, e-mail
Firstwave at info@firstwave.net or call 770-431-1200 or visit Firstwave's web
site at http://www.firstwave.net.

The following table shows the price range of the Company's Common Stock (high
and low bid information) for the indicated fiscal quarters.  The prices
represent quotations between dealers and do not necessarily represent actual
transaction and do not include retail mark-ups, mark-downs or commissions.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------
Fiscal 1997                First             Second            Third    Forth
-------------------------------------------------------------------------------
<S>                        <C>               <C>               <C>      <C>
High                       $4.50             $6.5000           $5.75    $5.2500
Low                        $3.00             $2.1875           $4.50    $3.4375
-------------------------------------------------------------------------------
</TABLE>


As of December 31, 1997 there were approximately 104 shareholders of record and
approximately 1,725 persons or entities who hold common stock in nominee name.

<TABLE>
<CAPTION>
-------------------------------------------------------------------------------
Fiscal 1996                First             Second            Third    Forth
-------------------------------------------------------------------------------
<S>                        <C>               <C>               <C>      <C>
High                       $11.25            $8.75             $7.50    $4.875 
Low                        $6.25             $6.50             $4.25    $2.875 
-------------------------------------------------------------------------------
</TABLE>

<PAGE>   12












                                [FIRSTWAVE LOGO]
                                        
                                        
                                        
                         FIRST WAVE TECHNOLOGIES, INC.
                                        
                            Overlook III, Suite 1000
                                        
                             2859 Paces Ferry Road
                                        
                               Atlanta, GA  30339
                                        
                                  770.431.1200

                                770.431.1201 FAX
                                        
                           e-mail info@firstwave.net
                                        
                            http://www.firstwave.net
                                        
                               1997 ANNUAL REPORT