TRANSFER AGENT INSTRUCTIONS
HOMECOM COMMUNICATIONS, INC.
March 25, 1999
American Stock Transfer 40 Wall Street New York, New York 10005
ATTN: CARLOS PINTO
Dear Mr. Pinto:
Reference is made to that certain Securities Purchase Agreement, of even date herewith, by and among HomeCom Communications, Inc., a Delaware corporation (the "COMPANY"), and each of the subscribers listed in Exhibit "A" attached hereto (collectively, the "HOLDERS") pursuant to which the Company is issuing to the Holders an aggregate of 125 shares of Series B Preferred Stock, $.0001 par value, of the Company (the "PREFERRED SHARES"). This letter shall serve as our irrevocable authorization and direction to you (provided that you are the transfer agent of the Company at such time) to issue shares (the "CONVERSION SHARES") of Common Stock, $.0001 par value (the "COMMON STOCK"), of the Company to or upon the order of a Holder from time to time upon (i) surrender to you of a properly completed and duly executed Conversion Notice, in the form attached hereto as Exhibit I, which has been properly agreed and acknowledged by the Company as indicated by the signature of a duly authorized officer of the Company thereon and (ii) certificates representing Preferred Shares being converted (or an indemnification undertaking with respect to such shares in the case of their loss, theft or destruction). So long as you have previously received: (i) written confirmation from counsel to the Company that a registration statement covering resales of the Conversion Shares has been declared effective by the U.S. Securities and Exchange Commission (the "SEC") under the Securities Act of 1933, as amended (the "1933 ACT"), and (ii) a copy of such Registration Statement, Certificates representing the Conversion Shares shall not bear any legend restricting transfer of the Conversion Shares thereby and should not be subject to any stop-transfer restriction. However, if you have not previously received (i) written confirmation from counsel to the Company that a registration statement covering resales of the Conversion Shares has been declared effective by the Securities and Exchange Commission under the Securities Act of 1933, as amended, and (ii) a copy of such registration statement, then the certificates representing the Conversion Shares shall bear the following legend:
"THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN
REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE
STATE SECURITIES LAWS. THE SECURITIES HAVE BEEN ACQUIRED FOR INVESTMENT
AND MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED IN THE
ABSENCE OF AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER
THE SECURITIES ACT OF 1933, AS AMENDED, OR APPLICABLE STATE SECURITIES
LAWS, OR AN OPINION OF COUNSEL, IN A REASONABLY
ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR
APPLICABLE STATE SECURITIES LAWS OR UNLESS SOLD PURSUANT TO RULE 144
UNDER SAID ACT."
provided, however, that the Company may from time to time notify you to place stop transfer restrictions on the certificates for the Conversion Shares in the event a registration statement covering the Conversion Shares is subject to amendment for events then current.
An opinion of counsel to the Company that the issuance of the Conversion Shares to the Holders will be exempt from registration under the 1933 Act is attached hereto as Exhibit II.
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