SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549
                                 --------------

                                    FORM 10-K
(Mark One)
       /X/   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
             THE SECURITIES EXCHANGE ACT OF 1934

                   For the fiscal year ended December 31, 2002

                                       or

       / /   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
             THE SECURITIES EXCHANGE ACT OF 1934

         For the transition period from ______________ to ______________

                         Commission File Number: 0-29204
                       -----------------------------------

                          HomeCom Communications, Inc.
                -------------------------------------------------
               (Exact name of registrant specified in its charter)

            Delaware                                            58-2153309
(State or other jurisdiction of                              (I.R.S. Employer
 incorporation or organization)                             Identification No.)

                             Building 12, Suite 110
                               3495 Piedmont Road
                             Atlanta, Georgia 30305
              (Address of principal executive offices and zip code)

               Registrant's Telephone Number, Including Area Code:
                                 (404) 237-4646

           Securities registered pursuant to Section 12(b) of the Act:
     Title of each class                    Name of exchange on which registered
------------------------------              ------------------------------------
Common Stock, par value $0.0001                          OTC-BB
          per share


           Securities registered pursuant to Section 12(g) of the Act:
                                      None

     Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
Registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes / X / No / /

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. / /

     Indicate by check mark whether the Registrant is an accelerated filer (as
defined in Exchange Act Rule 12b-2). Yes / / No /X/

     The aggregate market value of the voting stock held by non-affiliates of
the Registrant, based upon the average of the closing bid and ask quotations for
the Common Stock on March 12, 2003 as reported on the OTC Bulletin Board, was
approximately $8,316. The shares of Common Stock held by each officer and

<PAGE>


director and by each person known to us who owns 5% or more of the outstanding
Common Stock have been excluded in that such persons may be deemed to be
affiliates. This determination of affiliate status is not necessarily a
conclusive determination for other purposes.

     As of March 12, 2003, Registrant had outstanding 14,999,156 shares of
Common Stock.






                                       ii

<PAGE>


                                TABLE OF CONTENTS


Item No.                       Description                              Page No.
--------   ------------------------------------------------------------ --------
PART I
       1.  BUSINESS....................................................    1
       2.  PROPERTIES..................................................    6
       3.  LEGAL PROCEEDINGS...........................................    6
       4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.........    6

PART II
       5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED
           SHAREHOLDER MATTERS.........................................    7
       6.  SELECTED FINANCIAL DATA.....................................    8
       7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
           AND RESULTS OF OPERATIONS...................................    9
       8.  FINANCIAL STATEMENTS........................................   13
       9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING
           AND FINANCIAL DISCLOSURE....................................   34

PART III
      10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT..........   35
      11.  EXECUTIVE COMPENSATION......................................   37
      12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
           MANAGEMENT..................................................   40
      13.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS..............   41

PART IV
      14.  CONTROLS AND PROCEDURES.....................................   41
      15.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND
           REPORTS ON FORM 8-K.........................................   42
           SIGNATURES..................................................   48
           CERTIFICATION...............................................   50



                                      iii
<PAGE>

                                     PART I

Item 1. BUSINESS

FORWARD-LOOKING STATEMENTS

     This Form 10-K contains certain statements, such as statements regarding
HomeCom's future plans, that constitute forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, as amended, and Section
21E of the Securities and Exchange Act of 1934, as amended, including certain
statements contained under "Management's Discussion and Analysis of Financial
Condition and Results of Operations" concerning our expectations, beliefs, or
strategies regarding increased future revenues and operations, and certain
statements contained under "Business" concerning our future business plans. When
used in this Form 10-K, the words "expects", "believes," "intends,"
"anticipates" and similar expressions are intended to identify forward-looking
statements. Such statements are subject to certain risks and uncertainties that
could cause actual results to differ materially from those projected or implied
by such forward-looking statements. Such risks and uncertainties include things
such as changes in the value and condition of our assets, the loss of key
personnel, whether we are able to complete the proposed transactions described
in this form 10-K, a change in control of the Company or changes in financial
markets and general economic conditions. Reference is also made in particular to
the discussion set forth in our Registration Statements on Forms S-1 (File Nos.
333-12219, 333-42599, 333-45383, 333-86837, 333-88491, and 333-56795) and S-3
(333-73123 and 333-81581).

HISTORY AND RECENT DEVELOPMENTS

Recent Developments

Sale of Assets to Tulix Systems, Inc.

     On March 27, 2003, HomeCom Communications, Inc. ("HomeCom," "we" or "us")
entered into an Asset Purchase Agreement (the "Agreement") with Tulix Systems,
Inc. ("Tulix"), a company in which Gia Bokuchava, Nino Doijashvili and Timothy
R. Robinson, who are officers and directors of HomeCom, are officers, directors
and founding shareholders.

     Under the Agreement, Tulix will purchase the assets used in the operation
of our hosting and web site maintenance business, including intellectual
property, equipment, contracts, certain accounts receivable in an aggregate
amount of approximately $70,000, and cash of $50,000 (the "Asset Sale"). As
consideration for these assets, Tulix will:

     o    issue to us shares of Tulix common stock that will represent 15% of
          the outstanding shares of Tulix;

     o    issue to us a secured promissory note (the "Note") for a principal
          amount of $70,000 (subject to adjustment as described herein) that
          will bear interest at an annual rate of 7%, will be secured by certain
          assets of Tulix that are transferred to Tulix as part of the Asset
          Sale, and will become due one year after the closing of the Asset Sale
          (the principal amount of the note may be increased at closing pursuant
          to the terms of the Agreement); and,

     o    assume certain obligations of ours, including certain accounts payable
          related to ongoing operations.

     The note to be issued by Tulix to HomeCom will be for a principal amount of
$70,000, subject to adjustment as described below. If the sum of the cash and
accounts receivable of HomeCom (as determined in accordance with GAAP in a
manner consistent with HomeCom's past practices) on the day that we complete the
Asset Sale is less than $325,053, the principal amount of the Note will be
increased by an amount equal to the difference between $325,053 and the sum of
HomeCom's cash and accounts receivable on the closing date (to the extent that
the sum of cash and accounts receivable on the day that we complete the Asset
Sale is more than $325,053, we will divide the excess evenly between HomeCom and

                                       1
<PAGE>

Tulix). The Note will bear interest at a rate of 7.0% per year and will mature
on the one year anniversary of the Closing of the Asset Sale. Interest will be
due and payable at maturity. The Note will be secured by certain assets
transferred to Tulix in the Asset Sale.

     In connection with the Asset Sale, the Agreement provides that we will
enter into a Shareholders' Agreement with Tulix, Mr. Robinson, Mr. Bokuchava and
Ms. Doijashvili. The Shareholders' Agreement would give HomeCom certain rights
as a holder of Tulix stock for a period of five years. These rights include
rights of co-sale, rights of first refusal, anti-dilution rights and rights to
inspect the books and records of Tulix. The co-sale rights will give us (and the
other Tulix shareholders) the right to participate in any sales, subject to
certain exclusions, of Tulix stock by other Tulix shareholders. The rights of
first refusal granted to us in the Shareholders' Agreement will require that
Tulix give us (and the other Tulix shareholders) the right to purchase any
securities, subject to certain exclusions, that it intends to offer to third
parties before it offers those securities to third parties. The anti-dilution
rights contained in the Shareholders' Agreement require Tulix to grant us
additional shares of common stock any time, subject to certain exclusions, it
issues shares of common stock to other persons so that our aggregate ownership
interest in Tulix is generally not diluted. Finally, the Shareholders' Agreement
gives us the right to inspect the books and records of Tulix, subject to the
specific terms of the Shareholders' Agreement.

     The parties intend to complete the Asset Sale if (i) it is approved by
HomeCom's stockholders as required under Delaware law and (ii) the other
conditions to closing set forth in the Agreement are satisfied or waived. These
conditions include, among others, the requirement that all third parties who
have a contractual right to approve the assignment of their contracts to Tulix
must consent to such assignment and a condition in favor of Tulix that the
largest customer of the business to which the assets relate not have given
notice that it intends to terminate its relationship with the business. As such,
we can offer no assurance that the Asset Sale will be completed. Neither we nor
Tulix is under any obligation to pay any type of termination fee if we do not
complete the Asset Sale, and there are no other deal protection measures. The
Agreement also contains a release from Tulix pertaining to certain matters and
mutual releases with Mr. Robinson, Mr. Bokuchava and Ms. Doijashvili regarding
certain employment matters. (See "Part III. Item 11: Executive Compensation,
Employment Contracts.").

License Agreement with Eurotech, Ltd.

     Also on March 27, 2003, HomeCom entered into a License and Exchange
Agreement with Eurotech, Ltd. ("Eurotech") and, with respect to Articles V and
VI thereof, Polymate, Ltd. and Greenfield Capital Partners LLC (the "Exchange
Agreement"). The Exchange Agreement contemplates that Eurotech and HomeCom will
enter into a License Agreement (the "License Agreement"). Pursuant to the
Exchange Agreement and the License Agreement, Eurotech will license to HomeCom
its rights to the EKOR, HNIPU and Electro Magnetic Radiography (EMR)
technologies. In exchange for the license of these technologies, HomeCom will
(i) issue to Eurotech 11,250 shares of Series F preferred stock and 1,069 shares
of Series G preferred stock, both of which are new series of HomeCom's preferred
stock, and (ii) pay Eurotech a royalty of seven percent (7.0%) on net sales
generated by the licensed technologies and a royalty of four percent (4.0%) on
net sales generated by products and services that are improvements on the
licensed technologies. Closing of this transaction is subject to a number of
conditions, including HomeCom's delivery of evidence that: (i) its accounts
payable have been reduced to roughly $600,000, and (ii) the holders of HomeCom's
Series B, C, D and E preferred stock have waived the mandatory conversion rights
granted to them in connection with their respective shares of preferred stock.
As such, we can offer no assurance that this transaction will be completed. The
Exchange Agreement provides that, during the period prior to closing of the sale
of HomeCom's hosting and web site maintenance business, the financial needs of
the hosting and web site maintenance business will be funded by the operations
of that business, while the finances relating to the new licensed technologies
will be kept separate.

     EMR is a technology intended for the imaging of subterranean nuclear and
hazardous wastes in ground and marine settings, and for oil exploration. HNIPU
is a technology intended to improve upon conventional monolithic polyurethanes
through a non-toxic process. EKOR is a family of non-toxic advanced composite
polymer materials used in the containment of nuclear and hazardous materials.

     Shares of Series F Convertible Preferred Stock are convertible into shares
of common stock at a conversion rate of 10,000 shares of common stock per Series
F Share, subject to adjustment as set forth in the Certificate of Designations

                                       2
<PAGE>

governing the Series F Preferred Stock. As such, the 11,250 shares of Series F
Preferred Stock to be issued to Eurotech will be convertible into 112,500,000
shares of common stock. In connection with the consummation of the transactions
contemplated by the Exchange Agreement, we have agreed to issue 1,500 shares of
Series F Preferred Stock to Polymate and 750 shares of Series F Preferred Stock
to Greenfield. As such, we have agreed to issue a total of 13,500 shares of
Series F Preferred Stock that will be convertible into 135,000,000 shares of
common stock. The Certificate of Designations, however, provides that the shares
of Series F preferred stock will only be convertible if HomeCom has a sufficient
number of authorized but unissued shares of common stock available to support
the conversion of the outstanding shares of all series of preferred stock
(although the Certificate of Designations states that the shares of Series F
Preferred Stock will become convertible on December 31, 2003 regardless of
whether a sufficient number of shares of common stock have been authorized by
such date). Currently, however, HomeCom has only 15,000,000 shares of authorized
common stock, of which 14,999,156 shares have been issued and are outstanding.
As such, our Board of Directors has approved, and has directed us to submit to
our stockholders, a proposal to amend our Certificate of Incorporation to, among
other things, increase the number of shares of common stock that we are
authorized to issue to 300,000,000 shares. If this amendment is approved, and if
Eurotech converts its shares of Series F Preferred Stock into shares of common
stock, a change in control of HomeCom could occur. For example, if Eurotech were
to convert all of its shares of Series F Preferred Stock, and if Polymate and
Greenfield were to convert their shares of Series F Preferred Stock into shares
of common stock, and if none of our other preferred shareholders were to convert
their shares of preferred stock into shares of common stock, Eurotech would hold
approximately 112,500,000 of the approximately 150,000,000 shares of common
stock then-outstanding, or roughly 75% of the then-outstanding shares of common
stock, and Polymate and Greenfield would hold, in the aggregate, approximately
22,500,000 shares of common stock, representing roughly 15% of the
then-outstanding shares. Shares of Series F Preferred Stock have the right to
vote on all matters with the common stock to the extent that such shares of
Series F Preferred Stock are then convertible into shares of common stock.

     Pursuant to the License Agreement, HomeCom has agreed to issue 1,069 shares
of Series G Convertible Preferred Stock to Eurotech. Each share of Series G
Convertible Preferred Stock is convertible into a number of shares of common
stock determined by dividing $1,000 by a number equal to 82.5% of the average
closing price of the common stock over the preceding five business days. Shares
of Series G preferred stock have no voting rights.

     HomeCom has agreed to enter into a commercially reasonable registration
rights agreement with Eurotech, Polymate and Greenfield pursuant to which
HomeCom would grant both demand and piggyback registration rights to those
entities.

     In anticipation of the transaction, Lawrence Shatsoff and David Danovitch
have resigned from the HomeCom Board of Directors, and Don Hahnfeldt, the
President and Chief Executive Officer of Eurotech, and Dr. Randolph Graves, a
director and the Chief Financial Officer and Vice President of Eurotech, have
been elected to fill these vacancies on the HomeCom Board of Directors.

     If we complete the Tulix transaction, we expect Mr. Robinson, Mr. Bokuchava
and Ms. Doijashvili to resign from the Board of Directors. This would leave
Michael Sheppard, Mr. Hahnfeldt and Dr. Graves as the three members of the
HomeCom Board of Directors, meaning that the two designees of Eurotech will
constitute a majority of our Board of Directors. It is expected that new HomeCom
officers, who will be identified by Eurotech, will be appointed by the Board of
Directors at such time.


History

     The Company was organized in 1994 to provide complex web-based software
applications and integration services to businesses seeking to take advantage of
the Internet. Over time, we evolved into a Web design, financial applications
and solutions provider to the financial services market, including banking,
insurance, securities brokerage firms and other financially oriented web
portals. In fact, prior to and during 2000, we derived revenue from, among other
sources, professional web development services, software licensing, application
development, insurance and securities sales commissions, and hosting and
transactions fees.

                                       3
<PAGE>

     On March 24, 1999, we acquired all of the outstanding shares of FIMI and
certain of its affiliates for 1,252,174 shares of common stock. In addition, we
entered into employment agreements for an initial term of three years with the
three principals of FIMI, calling for them to continue in their roles for the
acquired companies. Prior to the closing of the acquisition, we loaned the
shareholders of FIMI $370,000 ("FIMI notes"). The FIMI notes were to be repaid
in either cash or common stock and were collateralized by common stock. We also
granted these FIMI shareholders 300,000 warrants to acquire our shares of common
stock at an exercise price of $3.74 per share. Vesting of the warrants was
contingent upon FIMI meeting certain operating goals.

     On April 23, 1999, we acquired all the outstanding shares of Ganymede
Corporation for total consideration of 185,342 shares of common stock and
$100,000 cash. Ganymede was a Chicago-based web site developer for financial
institutions. In addition, we entered into employment agreements with the three
principals of Ganymede, calling for them to continue in their current roles for
the acquired company.

     On October 1, 1999 we sold our security consulting and integration service
operations in exchange for $200,000 in cash, certain security audit rights and
shares of a non-public entity originally valued at approximately $823,000, and
entered into a joint marketing program with the acquirer.

     On January 31, 2001, we sold substantially all of the assets of FIMI and
its affiliates to Digital Insurance, Inc. ("Digital") for approximately $458,000
in cash and the assumption of certain liabilities. In connection with the sale,
the FIMI principals surrendered the shares of the common stock that
collateralized the FIMI notes and forfeited their warrants.

     On March 15, 2001, we sold substantially all of the assets used in our
Internet Banking operations to Netzee, Inc. The sale generated net proceeds to
HomeCom of approximately $407,000.

     Following the sale of our Internet Banking operations and our InsureRate
division, we had only one remaining operating business, our hosting and web site
maintenance business.

     On March 23, 2001, HomeCom issued a press release to announce our intention
to wind down our operations and, to the extent possible, sell our remaining
assets. In our press release, we stated, "HomeCom also announced that it has
decided to wind down its operations... HomeCom has been unable to obtain
additional financing and has insufficient assets to completely satisfy its
obligations to creditors and the liquidation preferences of its preferred
stock." The press release went on to state: "HomeCom continues to explore other
possibilities, which may include the sale of other assets." We have entered into
our agreement with Tulix in furtherance of the intentions announced in this
press release.

Sales and Marketing

     We currently have no active marketing strategies or plans.

Intellectual Property Rights

     In accordance with industry practice, we have relied primarily on a
combination of copyright, patent and trademark laws, trade secrets,
confidentiality procedures and contractual provisions to protect our proprietary
rights. We have sought to protect our software, documentation and other written
materials principally under trade secret and copyright laws, which afford only
limited protection. We have tried to use non-disclosure and confidentiality
agreements with employees, vendors, contractors, consultants and customers to
address these concerns.

     We do not believe that any of our products infringe the proprietary rights
of third parties. There can be no assurance, however, that third parties will
not claim infringement by us with respect to our products. In addition, Web site
developers such as ours face potential liability for the actions of customers
and others using their services, including liability for infringement of
intellectual property rights, rights of publicity, defamation, libel, fraud,
misrepresentation, unauthorized computer access, theft, tort liability and
criminal activity under the laws of the United States, various states and
foreign jurisdictions.

                                       4
<PAGE>

Employees

     As of March 12, 2003, we had 7 full-time employees. If we sell our assets
to Tulix, we expect that all of these employees will resign from their positions
with us and go to work for Tulix. On March 21, 2003, the Board appointed Michael
Sheppard, one of our outside directors, to serve as a vice president of the
Company, with specified limited powers generally relating to the proposed sale
of assets to Tulix and the proposed transaction with Eurotech. The Board expects
that Mr. Sheppard will remain an officer of HomeCom if the sale of assets to
Tulix and the proposed license transaction with Eurotech are completed.

Customers

     During 2000, two customers each accounted for over 10% of revenues with one
of those customers accounting for over 40%. During 2001 only one customer,
Roadrunner, accounted for over 10% of sales, accounting for 82%. During 2002
Roadrunner alone accounted for 93% of sales. Our sales to our five largest
customers represented approximately 76%, 89% and 97% of the total revenues for
2000, 2001 and 2002 respectively.

Insurance

     We maintain liability and other insurance that we believe to be customary
and generally consistent with industry practice. We believe that such insurance
is adequate to cover potential claims relating to our existing business
activities.

Government Regulation

     Except with regard to insurance and securities sales, as discussed below,
we do not believe that we are currently subject to direct regulation by any
government agency, other than regulations applicable to businesses generally,
and also believe that there are currently few laws or regulations directly
applicable to Web site service companies. The Federal Communications Commission
is studying the possible regulation of the Internet. Any such regulations
adopted by the Federal Communications Commission may adversely impact the manner
in which we conduct our business. It is possible that a number of additional
laws and regulations may be adopted with respect to the Internet, covering
issues such as user privacy, pricing, characteristics, and quality of products
and services. The adoption of any such laws or regulations may decrease the
growth of the Internet, which could in turn decrease the demand for our products
and services and increase our cost of doing business or cause us to modify our
operations, or otherwise have an adverse effect on our business, financial
condition and operating results. Moreover, the applicability to the Internet of
existing laws governing issues such as property ownership, libel, and personal
privacy is uncertain. We cannot predict the impact, if any, that future
regulation or regulatory changes may have on our business. In addition, Web site
developers such as us face potential liability for the actions of customers and
others using their services, including liability for infringement of
intellectual property rights, rights of publicity, defamation, libel, fraud,
misrepresentation, unauthorized computer access, theft, tort liability and
criminal activity under the laws of the U.S., various states and foreign
jurisdictions. Any imposition of liability could have a material adverse effect
on us.

     In addition, our network services are transmitted to our customers over
dedicated and public telephone lines. These transmissions are governed by
regulatory policies establishing charges and terms for communications. Changes
in the regulatory environment relating to the telecommunications and media
industry could have an effect on our business, including regulatory changes
which directly or indirectly affect use or access of the Internet or increase
the likelihood or scope of competition from regional telephone companies, could
have a material adverse effect on us.

     We own, and prior to January 31, 2001, operated a subsidiary named "FIMI
Securities, Inc." FIMI Securities was a NASD regulated broker/dealer and was
affiliated with various insurance agencies until it terminated its membership in
the NASD on December 29, 2000. We still own FIMI Securities, but it no longer
conducts any broker/dealer activities and is a dormant entity.

                                       5
<PAGE>

Item 2. PROPERTIES

     As of March 12, 2003 we occupy approximately 7,000 square feet in one
office building in Atlanta, Georgia under a lease expiring in October 2003. This
facility serves as our headquarters and computer center. If we complete the sale
of substantially all of our assets to Tulix, we expect that Tulix will assume
this lease from us.

     We have abandoned an office in New York City where we used to occupy
approximately 3,400 square feet under a lease that expired in January 2003, and
abandoned an office in Atlanta.

     As of December 31, 2002 we have an accrual for real estate disposition
liabilities of approximately $206,000, which we believe will be sufficient to
settle all obligations related to the closing and abandonment of our offices in
New York and Atlanta.

     We believe that the property which we currently have under lease is
adequate to serve our business operations for the foreseeable future. We believe
that if we were unable to renew the lease on this facility, we could find other
suitable facilities with no material adverse effect on our business.

Item 3. LEGAL PROCEEDINGS

     On or about February 8, 2002, we received a complaint filed by Properties
Georgia OBJLW One Corporation in the State Court of Fulton County, Georgia on
December 6, 2001, alleging that we defaulted on our lease in Building 14 at 3495
Piedmont Road, Atlanta, Georgia 30305. The complaint sought damages in the
amount of $141,752 plus interest of $23,827, plus attorneys' fees and court
costs. On December 18, 2002 we reached a settlement with Georgia OBJLW One
Corporation in the amount of $135,000, consisting of one payment of $30,000 paid
at that time, followed by seven monthly payments of $15,000 to be made from
February thru August, 2003.

     On or about January 14, 2002, Creditors Adjustment Bureau, Inc., a
California corporation and the assignee of the claims of Siemens ICN, filed a
complaint against us alleging, among other things, that we breached our contract
with Siemens. The complaint sought damages of $18,058.08 plus interest at a rate
of 18% from January 26, 2001, plus expenses and attorneys' fees. The complaint
was filed in the Superior Court of California, County of Santa Clara,
California. On April 26, 2002, after retaining counsel and as a result of the
Company's response, the complaint was dismissed.

     We are not a party to any other material legal proceedings. From time to
time, we are involved in various routine legal proceedings incidental to the
conduct of our business.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     We did not submit any matters to a vote of securityholders during the
fourth quarter of 2002.



                                       6
<PAGE>

                                     PART II

Item 5.  MARKET FOR REGISTRANT'S COMMON EQUITY AND RELATED SHAREHOLDER MATTERS

     Our Common Stock has been quoted on the OTC Bulletin Board under the symbol
"HCOM" since December 8, 2000. Prior to that date it was quoted on the Nasdaq
SmallCap Market. The following table shows for the periods indicated the range
of high and low bid prices as quoted on the OTC Bulletin Board. The quotations
reflect inter-dealer prices, without retail mark-up, mark-down or commission and
may not represent actual transactions.

2001:                                        High              Low
First quarter                             $     .190       $     .018
Second quarter                                  .023             .006
Third quarter                                   .019             .007
Fourth quarter                                  .019             .003

2002:
First quarter                             $     .010       $     .010
Second quarter                                  .028             .003
Third quarter                                   .005             .003
Fourth quarter                                  .006             .001

2003:
First quarter (through March 12, 2003)    $     .004       $     .001


Holders of Record

     We had approximately 127 holders of record of our Common Stock as of March
12, 2003.

Dividends

     We have not paid any cash dividends on our capital stock to date and do not
foresee that we will have earnings with which to pay dividends in the
foreseeable future. Our board of directors would determine the amount of future
dividends, if any, based upon our earnings, financial condition, capital
requirements and other conditions.

                                       7
<PAGE>

Item 6. SELECTED FINANCIAL DATA

     The following selected financial data of HomeCom Communications, Inc.
should be read in conjunction with "Management's Discussion and Analysis of
Financial Condition and Results of Operations" and the financial statements and
related notes.
<TABLE>
<CAPTION>


                                                                            Year Ended December 31,
                                                 ----------------------------------------------------------------------------
                                                     1998            1999            2000           2001             2002
                                                 ------------    ------------    ------------   -------------    ------------
<S>                                              <C>             <C>             <C>             <C>             <C>
Statement of Operations Data:
Revenues                                         $  2,481,905    $  3,907,282    $  4,509,977    $  1,279,486    $  1,484,836
Cost of revenues                                    2,085,598         951,406       2,722,309       1,007,430       1,036,961
                                                 ------------    ------------    ------------    ------------    ------------
Gross profit                                          396,307       2,955,876       1,787,668         272,056         447,875
                                                 ------------    ------------    ------------    ------------    ------------

Operating expenses:
  Sales and marketing                               1,142,222       2,878,302       1,944,020             858
  Product development                                 633,268         315,809         321,259
  General and administrative                        2,896,287       3,765,514       1,182,192         770,659         517,323
  Depreciation and amortization                       542,269       1,757,124       1,605,345
  Asset Impairment                                                                  1,436,078         493,905          52,584
                                                 ------------    ------------    ------------    ------------    ------------
      Total operating expenses                      5,214,046       8,716,749       6,488,894       1,265,422         569,907
                                                 ------------    ------------    ------------    ------------    ------------
Operating loss                                     (4,817,739)     (5,760,873)     (4,701,226)       (993,366)       (122,032)
Other expenses (income):
  Gain on sale of division                         (4,402,076)
  Interest expense (income)                           445,216          32,583          (5,981)
  Other expense (income), net                        (166,917)       (103,175)        (90,793)       (146,362)        (26,637)
                                                 ------------    ------------    ------------    ------------    ------------
Loss from continuing operations before               (693,962)     (5,690,281)     (4,604,452)       (847,004)        (95,395)
income  taxes
Income tax provision (benefit)                           --              --              --              --              --
                                                 ------------    ------------    ------------    ------------    ------------
Loss from continuing operations                      (693,962)     (5,690,281)     (4,604,452)       (847,004)        (95,395)
Loss from discontinued operations                    (510,178)     (4,630,508)     (1,755,898)
Gain (loss) on disposal of business segment                         1,144,591      (3,000,377)        394,543
                                                 ------------    ------------    ------------    ------------    ------------
Net Loss                                           (1,204,140)     (9,176,198)     (9,360,727)       (452,461)        (95,395)
Deemed preferred stock dividend                      (666,667)     (2,557,466)     (1,526,728)       (708,778)       (706,733)
                                                 ------------    ------------    ------------    ------------    ------------
Loss applicable to common shareholders           $ (1,870,807)   $(11,733,664)   $(10,887,455)   $ (1,161,239)   $   (802,128)
                                                 ============    ============    ============    ============    ============
Gain (Loss) per common share--basic and
diluted
  Continuing operations                          $      (0.16)   $      (0.90)   $      (0.72)   $      (0.16)   $      (0.05)
  Discontinued operations                               (0.28)          (0.96)          (0.55)           0.04
                                                 ------------    ------------    ------------    ------------    ------------
      Total                                      $      (0.44)   $      (1.86)   $      (1.27)   $      (0.12)   $      (0.05)
                                                 ============    ============    ============    ============    ============
Weighted average common shares outstanding          4,287,183       6,324,791       8,549,693       9,869,074      14,999,156
                                                 ============    ============    ============    ============    ============


                                              ----------------------------------------------------------------------------
                                                  1998            1999              2000          2001            2002
                                              ------------    ------------    ------------    ------------    ------------
Balance Sheet Data:
Working capital (deficit)                     $  2,265,725    $  1,033,802    $   (823,406)   $   (960,154)   $ (1,705,568)
Total assets                                     4,565,490      10,535,718       2,528,973         665,391         507,554
Long-term obligations                               88,242         315,275         357,757
Total liabilities                                1,117,041       2,930,600       2,298,013       1,533,124       2,109,069
Redeemable Preferred Stock                                       1,624,920         251,750         251,750         251,750
Stockholders' equity (deficit)                   3,448,449       5,980,198         (20,790)     (1,119,483)     (1,853,265)


                                                                 8
</TABLE>
<PAGE>

Item 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
        RESULTS OF OPERATIONS

General

     Historically, we developed and marketed specialized software applications,
products and services that enabled financial institutions and their customers to
use the Internet and intranets/extranets to obtain and communicate important
business information, conduct commercial transactions and improve business
productivity. We provided Internet/intranet solutions in three areas: (i) the
design, development and integration of customized software applications,
including World Wide Web site development and related network outsourcing; (ii)
the development, sale and integration of our existing software applications into
the client's operations; and, (iii) security consulting and integration
services. In October, 1999, we sold our security consulting and integration
services operations and entered into a joint marketing program with the
acquirer. During 2001, we sold our remaining software applications businesses.
Currently, we only derive revenue from professional web development services and
hosting fees. On March 23, 2001, we announced our intentions to wind down our
operations. We have entered into an agreement to sell substantially all of the
assets used in our hosting and website maintenance business to Tulix. We have
also entered into an agreement to license certain technologies from Eurotech. If
these transactions are consummated, our only assets will be cash and accounts
receivable that we do not transfer to Tulix and the assets that we license from
Eurotech.

     In March 1999, we completed the acquisition of all the outstanding shares
of the First Institutional Marketing Companies, a group of insurance agencies
and a NASD broker/dealer (the "FIMI Companies"), for 1,252,174 shares of common
stock. Pursuant to the Merger and Plan of Reorganization the FIMI Companies
continued as separate subsidiaries of HomeCom. On January 31, 2001 we sold
substantially all of the assets of the FIMI Companies for approximately $458,000
and the assumption of certain liabilities. We recorded a loss on the sale of
$3,000,377. We have removed the results of this discontinued operation from the
continuing operations of the Company for all periods presented.

     Our revenues and operating results have varied substantially from period to
period, and should not be relied upon as an indication of future results.

Results of Operations

     Year Ended December 31, 2001 as Compared to Year Ended December 31, 2002

     Revenues. Revenues increased 16.0% from $1,279,486 in 2001 to $1,484,836 in
2002. This increase of $205,350 is primarily attributable to the growth in the
RoadRunner account. Revenues consisted of $9,332 in website development work in
progress, which is recognized based upon an average percentage completion
calculation (69% of current contracts totaling $13,500), and $16,090 and
$1,459,414 in hourly maintenance and monthly hosting respectively, which are
recognized at the time that services are provided.

     Cost of Revenues. Cost of revenues includes salaries for programmers,
technical staff, sales staff and customer support, as well as a pro-rata
allocation of telecommunications, facilities and data center costs. Cost of
revenues increased from $1,007,430, or 78.7% of revenues in 2001 to $1,036,961
or 69.8% of revenues in 2002. The increase in the cost of sales is attributable
to the expenditure of funds associated with the growth of the RoadRunner
account. Costs of Revenues decreased as a percentage of revenues due to the
gains in Hosting revenues outpacing increases in production costs.

     Gross Profit. Gross profit increased by $175,819 from $272,056 in 2001 to
$447,875 in 2002. Gross profit margins also increased from 21.3% during 2001 to
30.2% during 2002. This increase as a percentage of net sales is due to gains in
Hosting revenues, which outpaced increases in production costs.

     Sales and Marketing. The Company ceased all significant sales and marketing
efforts during 2001. There were no sales and marketing expenditures in 2002.

                                       9
<PAGE>

     Product Development. The Company ceased all product development efforts
during 2001. There were no product development expenditures in 2002.

     General and Administrative. General and administrative expenses include
salaries for administrative personnel, insurance and other administrative
expenses, as well as a pro-rata allocation of telecommunications, and facilities
and data center costs. General and administrative expenses decreased from
$770,659 in 2001 to $517,323 in 2002. As a percentage of net sales, these
expenses decreased from 60.2% in 2001 to 34.8% in 2002. The percentage decrease
is due to continued reduction in personnel and a resulting decrease in the
pro-rata portion of costs assigned to general and administrative expenses.

     Depreciation and Amortization. With the write down of the carrying value of
all fixed assets in the fourth quarter of 2000, the Company has suspended
depreciation of its remaining assets in anticipation of a sale. There were no
charges recognized in 2001 or 2002.

     Asset Impairment Charge. We incurred an asset impairment charge of $52,584
in association with the writedown of the fair market value of our fixed assets
to current market levels.

     Other Income. Other income consists of miscellaneous amounts received which
are outside the normal course of operations. Other income decreased from
$146,362 in 2001 to $26,637 in 2002. The decrease is primarily due to the
absence of any significant income outside of normal operations. Approximately
$20,600 of the miscellaneous income is attributable to the dismissal of the
lawsuit pursued by Creditor's Adjustment Bureau on behalf of Siemen's ICN and
the resultant adjustment to expenses which had been accrued.

     Year Ended December 31, 2000 as Compared to Year Ended December 31, 2001

     Revenues. Revenues decreased 71.6% from $4,509,977 in 2000 to $1,279,486 in
2001. This decrease of $3,230,491 is primarily attributable to the absence of
any web development work and the expiration of all maintenance contracts without
renewal. Revenues now consist exclusively of hosting and hourly billing site
maintenance work. We recognized revenues from continuing operations for the year
ended December 31, 2001 at the time the services were provided. These services
consisted of $53,181 in maintenance services, and $1,226,305 in web site hosting
services.

     Cost of Revenues. Cost of revenues includes salaries for programmers,
technical staff, sales staff and customer support, as well as a pro-rata
allocation of telecommunications, facilities and data center costs. Cost of
revenues decreased from $2,722,309 or 60.4% of revenues in 2000 to $1,007,430 or
78.7% of revenues in 2001. The decrease in the cost of sales is attributable to
reductions in production personnel and to the reduction of internet connection
and local loop costs. Costs of Revenues increased as a percentage of revenues
due to the loss in Web development revenues outpacing reductions in production
costs.

     Gross Profit. Gross profit decreased by $1,515,612 from $1,787,668 in 2000
to $272,056 in 2001. Gross profit margins also decreased from 39.6% during 2000
to 21.3% during 2001. This decrease as a percentage of net sales is due to the
loss of higher margin Web development work.

     Sales and Marketing. Sales and marketing expenses include salaries,
variable commissions, and bonuses for the sales force, advertising and
promotional marketing materials, and a pro-rata allocation of
telecommunications, facilities and data center costs. Sales and marketing
expenses decreased $1,943,162 from $1,944,020, or 43.1% of revenues, in 2000 to
$858, or 0.1% of revenues in 2001. The Company has discontinued all significant
sales and marketing efforts.

     Product Development. Product development costs consist of personnel costs
required to conduct our product development efforts, and a pro-rata allocation
of telecommunications, facilities and data center costs. Total expenditures for
product development decreased from $321,259 or 7.1% of revenues in 2000 to $0 in
2001. The Company has discontinued all product development efforts.

                                       10
<PAGE>

     General and Administrative. General and administrative expenses include
salaries for administrative personnel, insurance and other administrative
expenses, as well as a pro-rata allocation of telecommunications, and facilities
and data center costs. General and administrative expenses decreased from
$1,182,192 in 2000 to $770,659 in 2001. As a percentage of net sales, these
expenses increased from 26.2% in 2000 to 60.2% in 2001. The percentage increase
is due to the continued decline in revenues.

     Depreciation and Amortization. Depreciation and amortization includes
depreciation and amortization of computers, network equipment, office equipment,
equipment under capital leases, and intangible assets. Depreciation and
amortization decreased from $1,605,345 or 35.6% of net sales in 2000 to $0 or
0.0% in 2001. With the write down of the carrying value of all fixed assets in
the fourth quarter of 2000 and the Company's announcement that it intends to
wind-down its operations, the Company has suspended depreciation of its
remaining assets.

     Other Income. Other income consists of miscellaneous amounts received which
are outside the normal course of operations. Other income increased from $90,793
in 2000 to $146,362 in 2001. The increase is primarily due to the favorable
settlement of a $130,000 liability related to the prior sale of certain assets.
Without this settlement other income would have declined.

     Asset Impairment Charge. We incurred an asset impairment charge of $493,905
in association with the writedown of the carrying value of our investment in
iDefense.

     Interest Expense. No interest expense was incurred in 2001.

     Discontinued Operations. On January 31, 2001 we sold our FIMI division.
FIMI incurred operating losses of $1,970,584 for the year ended December 31,
2000. On March 15, 2001 we sold our Internet Banking segment for a gain of
$394,543. This segment produced net income of $214,686 for the year ended
December 31, 2000 with no operating profit or loss for the year ended December
31, 2001.

Recently Issued Accounting Standards

     See Note 1 to Notes to Consolidated Financial Statements for a complete
discussion of recently issued accounting standards and their expected impact on
our consolidated financial statements.


                                       11

<PAGE>

                         LIQUIDITY AND CAPITAL RESOURCES

General

     Our sources of capital are extremely limited. We have incurred operating
losses since inception and as of December 31, 2002, we had an accumulated
deficit of $25,795,686 and a working capital deficit of $1,705,568. On March 23,
2001, we announced our intentions to wind down operations. We have entered into
an agreement to sell substantially all of our operating assets to Tulix and we
have entered into an agreement to license certain technologies from Eurotech. If
we complete these transactions, our only operating assets will be cash and
accounts receivable that we do not transfer to Tulix and the assets that we
license from Eurotech.

     Whether we sell our remaining assets to Tulix or not, we believe that we
have exhausted our current sources of capital and also believe that it is highly
unlikely that we will be able to secure additional capital that would be
required to undertake additional steps to continue our operations. It is our
understanding that additional financing may be made available to HomeCom if the
proposed transaction with Eurotech closes. However, we have received no
commitment that any such financing will be made available, and the closing of
the Eurotech transaction is subject to a number of conditions that may prevent
the closing of the transaction from occurring. Furthermore, we can provide no
assurance that any such financing, even if it were to be provided to HomeCom,
would enable us to sustain our operations. If we cannot resolve our liabilities,
and no other alternatives are available, we may be forced to seek protection
from our creditors. The aforementioned factors raise substantial doubt about
HomeCom's ability to continue as a going concern. The financial statements
included herein have been prepared assuming HomeCom is a going concern and do
not include any adjustments that might result should HomeCom be unable to
continue as a going concern.

     Net cash used in operating activities was $214,626 for the year ended
December 31, 2002. Funds necessary for operations were provided by the use of
funds on deposit at the end of 2002.

     We spent $38,378 and $31,825 during 2002 and 2001, respectively, for the
purchase of capital equipment. These amounts were expended primarily for
computer equipment, communications equipment and software necessary for us to
maintain the operating integrity of our Network Operations Center for the
continued provision of services to our existing customers. Our commitments as of
December 31, 2002 consist of our lease on our Atlanta, Georgia facility.



                                       12
<PAGE>

Item 8. FINANCIAL STATEMENTS

                   INDEX TO CONSOLIDATED FINANCIAL STATEMENTS


                                                                           Page
                                                                          ------

Report of Independent Accountants                                           14
Consolidated Balance Sheets as of December 31, 2001 and 2002                15
Consolidated Statements of Operations for Each of the Three
   Years in the Period Ended December 31, 2002                              16
Consolidated Statements of Changes in Stockholders' Equity
   (Deficit) for Each of the Three Years in the Period Ended
    December 31, 2002                                                       17
Consolidated Statements of Cash Flows for Each of the Three
    Years in the Period Ended December 31, 2002                             18
Notes to Consolidated Financial Statements                                  20






                                       13
<PAGE>


                        REPORT OF INDEPENDENT ACCOUNTANTS


Board of Directors
Homecom Communications, Inc.


We have audited the accompanying consolidated balance sheets of HomeCom
Communications, Inc. and subsidiaries as of December 31, 2002 and 2001 and the
related statements of operations, stockholders' equity (deficit) and cash flows
for the years ended December 31, 2002, 2001 and 2000. These financial statements
are the responsibility of the Company's management. Our responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with auditing standards generally accepted
in the United States of Amercia. Those standards require that we plan and
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and
significant estimates made by management, as well as evaluating the overall
financial statement and presentation. We believe that our audits provide a
reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the financial position of HomeCom
Communications, Inc. and subsidiaries as of December 31, 2002 and 2001 and the
results of its operations and its cash flows for the years ended December 31,
2002, 2001 and 2000 in conformity with accounting principles generally accepted
in the United States of America .

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. As discussed in Note 1 to the
financial statements, the Company has experienced recurring losses and negative
cash flows since its inception and has an accumulated deficit. The Company is
dependent on continued financing from investors to sustain its activities and
there is no assurance that such financing will be available. These factors raise
substantial doubt about the Company's ability to continue as a going concern.
Management's plans in regard to these matters are also described in Note 1. The
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.


                                            /s/  Sherb & Company, LLC
                                            -----------------------------------
                                                 Sherb & Company, LLC
                                                 Certified Public Accountants


New York, New York
March 19, 2003, except for Note 14, which is dated as of March 28, 2003

                                       14
<PAGE>
<TABLE>
<CAPTION>


                                      HOMECOM COMMUNICATIONS, INC.
                                      CONSOLIDATED BALANCE SHEETS


                                                                                  December 31,
                                                                          ----------------------------
                                                                              2001            2002
                                                                          ------------    ------------
                                                 ASSETS

CURRENT ASSETS:
   <S>                                                                    <C>             <C>
   Cash and cash equivalents                                              $    413,346    $    160,342
   Accounts receivable, net                                                    154,144         243,159
                                                                          ------------    ------------
       Total current assets                                                    567,490         403,501
Prepaid expenses                                                                                20,358
Furniture, fixtures and equipment, net                                          97,901          83,695
                                                                          ------------    ------------
Total assets                                                              $    665,391    $    507,554
                                                                          ============    ============

                                 LIABILITIES AND STOCKHOLDERS' DEFICIT

CURRENT LIABILITIES:
   Accounts payable and accrued expenses                                  $  1,527,644    $  2,109,069
                                                                          ------------    ------------
       Total current liabilities                                             1,527,644       2,109,069
Other liabilities                                                                5,480
                                                                          ------------    ------------
       Total liabilities                                                     1,533,124       2,109,069
                                                                          ------------    ------------
   Redeemable Preferred stock, Series B $.01 par value, 125 shares
     authorized, 125 shares issued at December 31, 2001 and 2002,
     respectively and 17.8 shares outstanding at December 31, 2001 and
     2002, respectively, convertible, participating, $423,449
     liquidation value as of December 31, 2002                                 251,750         251,750
                                                                          ------------    ------------

STOCKHOLDERS' DEFICIT:
   Common stock, $.0001 par value, 15,000,000 shares authorized,
     14,999,156 shares issued and outstanding at December 31, 2001 and
     2002, respectively                                                          1,500           1,500
   Preferred stock, Series C, $.01 par value, 175 shares issued and
     authorized, 90.5 shares outstanding at December 31, 2001 and 2002,
     respectively, convertible, participating;                                       1               1
     $2,181,993 liquidation value at December 31, 2002
   Preferred stock, Series D, $.01 par value, 75 shares issued and
     authorized,1.3 shares outstanding at December 31, 2001 and 2002,
     respectively; convertible, participating;
     $30,871 liquidation value at December 31, 2002                                  1               1
   Preferred stock, Series E, $.01 par value, 106.4 shares issued and
   outstanding as of
     December 31, 2001 and 2002 respectively, convertible,
     participating; $2,588,996  liquidation value at December 31, 2002               1               1
   Treasury stock, 123,695 shares at December 31, 2002                          (8,659)         (8,659)
   Additional paid-in capital                                               24,587,964      23,949,577
   Accumulated deficit                                                     (25,700,291)    (25,795,686)
                                                                          ------------    ------------
       Total stockholders' deficit                                          (1,119,483)     (1,853,265)
                                                                          ------------    ------------
       Total liabilities and stockholders' deficit                        $    665,391    $    507,554
                                                                          ============    ============


                             The accompanying notes are an integral part of
                                these consolidated financial statements.

                                                   15
<PAGE>

                                      HOMECOM COMMUNICATIONS, INC.
                                  CONSOLIDATED STATEMENTS OF OPERATIONS



                                                                      Year Ended December 31,
                                                           --------------------------------------------
                                                               2000            2001            2002
                                                               ----            ----            ----

Revenues                                                   $  4,509,977    $  1,279,486    $  1,484,836
Cost of revenues                                              2,722,309       1,007,430       1,036,961
                                                           ------------    ------------    ------------
GROSS PROFIT                                                  1,787,668         272,056         447,875
                                                           ------------    ------------    ------------

OPERATING EXPENSES:
   Sales and marketing                                        1,944,020             858
   Product development                                          321,259
   General and administrative                                 1,182,192         770,659         517,323
   Depreciation and amortization                              1,605,345
   Asset impairment charge                                    1,436,078         493,905          52,584
                                                           ------------    ------------    ------------
   Total operating expenses                                   6,488,894       1,265,422         569,907
                                                           ------------    ------------    ------------
OPERATING LOSS                                               (4,701,226)       (993,366)       (122,032)

OTHER INCOME
    Interest income                                              (5,981)
    Other income                                                (90,793)       (146,362)        (26,637)
                                                           ------------    ------------    ------------
LOSS FROM CONTINUING OPERATIONS BEFORE INCOME TAXES          (4,604,452)       (847,004)        (95,395)

INCOME TAX PROVISION (BENEFIT)                                     --              --              --
                                                           ------------    ------------    ------------
LOSS FROM CONTINUING OPERATIONS                              (4,604,452)       (847,004)        (95,395)
LOSS FROM DISCONTINUED OPERATIONS                            (1,755,898)
GAIN (LOSS) ON DISPOSAL OF DISCONTINUED BUSINESS SEGMENT
                                                             (3,000,377)        394,543

                                                           ------------    ------------    ------------
NET LOSS                                                     (9,360,727)       (452,461)        (95,395)

DEEMED PREFERRED STOCK DIVIDEND                              (1,526,728)       (708,778)       (706,733)

                                                           ------------    ------------    ------------
LOSS APPLICABLE TO COMMON SHAREHOLDERS                     $(10,887,455)   $ (1,161,239)   $   (802,128)
                                                           ============    ============    ============

GAIN (LOSS) PER SHARE--BASIC AND DILUTED
     CONTINUING OPERATIONS                                 $      (0.72)   $      (0.16)   $      (0.05)
     DISCONTINUED OPERATIONS                                      (0.55)           0.04
                                                           ------------    ------------    ------------
             TOTAL                                         $      (1.27)   $      (0.12)   $      (0.05)
                                                           ============    ============    ============

WEIGHTED AVERAGE COMMON SHARES OUTSTANDING
  BASIC AND DILUTED                                           8,549,693       9,869,074      14,999,156
                                                           ============    ============    ============


                             The accompanying notes are an integral part of
                                these consolidated financial statements.

                                                   16
<PAGE>

                                      HOMECOM COMMUNICATIONS, INC.

                  CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)

                    For Each of the Three Years in the Period Ended December 31, 2002



                                   Preferred Stock                    Common Stock           Treasury
                                Shares          Amount           Shares        Amount         Stock
                             ------------    ------------    ------------   ------------   ------------

Balance, December 31, 1999            213    $          3       7,040,525   $        704   $

Issuance of preferred
  stock and warrants,
  net of offering costs               106               1
Warrant exercises                                                  15,077              1
Conversion of Series B
  preferred stock to
  common shares                                                   902,307             90
Conversion of Series C
  and D preferred
  stock to common shares             (119)             (1)      1,391,629            139
Stock option exercises                                              8,197              1
Cancellation of
  subscription receivable
  under employment
  agreements
Penalties on Series E
  preferred stock
Other                                                               1,421              1
Net loss
                             ------------    ------------    ------------   ------------   ------------
Balance, December 31, 2000            200               3       9,359,156   $        936


Receipt of Treasury stock                                                                        (8,659)
Conversion of Series C
  preferred stock to
  common shares                        (2)                      5,640,000            564
Penalties on preferred
  stock
Net loss
                             ------------    ------------    ------------   ------------   ------------
Balance, December 31, 2001            198               3      14,999,156          1,500         (8,659)

Penalties on preferred
  stock
Net loss
                             ------------    ------------    ------------   ------------   ------------
Balance, December 31, 2002            198    $          3      14,999,156   $      1,500   $     (8,659)
                             ============    ============    ============   ============   ============


Table continues on following page.

                             The accompanying notes are an integral part of
                                these consolidated financial statements.

                                                   17
<PAGE>

                               HOMECOM COMMUNICATIONS, INC.

           CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIT)

             For Each of the Three Years in the Period Ended December 31, 2002

                                       (Continued)


                                                                                 Total
                              Additional                                     Stockholders'
                               Paid-In      Subscriptions    Accumulated        Equity
                               Capital        Receivable       Deficit         (Deficit)
                             ------------    ------------    ------------    ------------

Balance, December 31, 1999   $ 21,931,281    $    (64,687)   $(15,887,103)   $  5,980,198

Issuance of preferred
  stock and warrants,
  net of offering costs         1,855,425                                       1,855,426
Warrant exercises                  79,617                                          79,618
Conversion of Series B
  preferred stock to
  common shares                 1,599,044                                       1,599,134
Conversion of Series C
  and D preferred
  tock to common shares              (138)
Stock option exercises             12,083                                          12,084
Cancellation of
  subscription receivable
  under employment
  agreements                                       64,687                          64,687
Penalties on Series E
  preferred stock                (251,211)                                       (251,211)
Other                                                                                   1
Net loss                                                       (9,360,727)     (9,360,727)
                             ------------    ------------    ------------    ------------
Balance, December 31, 2000     25,226,101               0     (25,247,830)        (20,790)


Receipt of Treasury stock                                                          (8,659)
Conversion of Series C
  preferred stock to
  common shares                      (564)
Penalties on preferred
  stock                          (637,573)                                       (637,573)
Net loss                                                         (452,461)       (452,461)
                             ------------    ------------    ------------    ------------
Balance, December 31, 2001     24,587,964               0     (25,700,291)     (1,119,483)

Penalties on preferred
  stock                          (638,387)                                       (638,387)
Net loss                                                          (95,395)        (95,395)
                             ------------    ------------    ------------    ------------
Balance, December 31, 2002   $ 23,949,577    $          0    $(25,795,686)   $ (1,853,265)
                             ============    ============    ============    ============


                      The accompanying notes are an integral part of
                         these consolidated financial statements.

                                      17(Continued)
<PAGE>

                                      HOMECOM COMMUNICATIONS, INC.

                                  CONSOLIDATED STATEMENTS OF CASH FLOWS


                                                                         Year Ended December 31,
                                                              -----------------------------------------
                                                                  2000           2001           2002
                                                              -----------    -----------    -----------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss                                                      $(9,360,727)   $  (452,461)   $   (95,395)
Adjustments to reconcile net loss to cash used in operating
  activities:
  Depreciation and amortization                                 1,632,939
  Write down of investment, fixed assets and intangibles        4,638,314        477,759         52,584
  Forgiveness of subscriptions receivable                          64,687
  Provision for bad debts                                        (184,851)        37,472        (24,813)
  Deferred rent expense                                          (124,321)         2,698         (5,480)
  Change in operating assets and liabilities:
    Accounts receivable                                           901,613         24,433        (64,202)
    Prepaid expenses                                                                            (20,358)
    Accounts payable and accrued expenses                        (228,422)      (982,431)       (56,962)
    Accrued payroll liabilities                                    85,121
    Unearned revenue                                             (296,319)
    Other                                                         244,402
                                                              -----------    -----------    -----------
  Net cash used in operating activities                        (2,627,564)      (892,530)      (214,626)
                                                              -----------    -----------    -----------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchase of furniture, fixtures and equipment                  (362,161)       (15,679)       (38,378)
  Loans to related parties                                        200,000
  Proceeds from sale of divisions                                                864,603
                                                              -----------    -----------    -----------
    Net cash provided by (used in) investing activities          (162,161)       848,924        (38,378)
                                                              -----------    -----------    -----------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Repayment of capital lease obligations                          (54,747)       (63,764)
  Proceeds from issuance of common shares and exercise of
    warrants                                                       12,084
  Proceeds from issuance of preferred shares and warrants       1,855,426
                                                              -----------    -----------    -----------
  Net cash provided by (used in) financing activities           1,812,763        (63,764)          --


                             The accompanying notes are an integral part of
                                 these consolidated financial statements

                                                   18
<PAGE>

                                          HOMECOM COMMUNICATIONS, INC.
                                CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)



                                                                               Year Ended December 31,
                                                                      -----------------------------------------
                                                                         2000           2001           2002
                                                                      -----------    -----------    -----------

NET DECREASE IN CASH AND CASH EQUIVALENTS                             $  (976,962)   $  (107,370)   $  (253,004)
CASH AND CASH EQUIVALENTS at beginning of year                          1,497,678        520,716        413,346
                                                                      -----------    -----------    -----------
CASH AND CASH EQUIVALENTS at end of year                              $   520,716    $   413,346    $   160,342
                                                                      ===========    ===========    ===========
SUPPLEMENTAL DISCLOSURES OF CASH FLOW INFORMATION AND
  NON CASH INVESTING AND FINANCING ACTIVITIES:
  Interest paid                                                       $      --      $      --      $      --
                                                                      ===========    ===========    ===========
  Capital lease obligations incurred during year on lease of
    computer equipment                                                $    40,474    $      --      $      --
                                                                      ===========    ===========    ===========


Year 2001

1.63 shares of preferred stock were converted into 5,640,000 shares of common
stock. 123,695 shares of common stock were returned to the Company and
classified as treasury stock (See Note 12).

Year 2000

216.33 shares of preferred stock were converted into 2,293,936 shares of common
stock.



                 The accompanying notes are an integral part of
                    these consolidated financial statements.

                                       19
</TABLE>
<PAGE>

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business and Basis of Presentation--Going Concern

     Historically, HomeCom Communications, Inc. (the "Company") developed and
marketed specialized software applications, products and services to enable
financial institutions and their customers to use the Internet and
intranets/extranets to obtain and communicate important business information,
conduct commercial transactions and improve business productivity. Revenue was
derived from professional web development services, software licensing,
application development, insurance and securities sales commissions, hosting
fees and transactions fees. The Company's financial statements are prepared
using generally accepted accounting principles applicable to a going concern
which contemplate the realization of assets and liquidation of liabilities in
the normal course of business. The Company has incurred significant losses since
its incorporation, resulting in an accumulated deficit at December 31, 2002 of
approximately $26 million. The Company continues to experience negative cash
flows from operations and is dependent on continued financing from investors to
sustain its activities. There is no assurance that such financing will be
available. These factors raise substantial doubt about the Company's ability to
continue as a going concern.

     On March 23, 2001 the Company announced that it was seeking to wind down
its operations. Additionally, the Company has filed a preliminary Proxy
Statement to announce a Special Meeting of the stockholders. One of the
proposals that the stockholders are being asked to consider and vote upon is a
proposal to sell the remaining hosting and website maintenance business to Tulix
Systems, Inc., a company in which Timothy R. Robinson, Gia Bokuchava and Nino
Doijashvili, who are officers and directors of both the Company and Tulix, are
the principal shareholders. If completed, the sale of this business, which is
the Company's only operating business, will constitute a sale of substantially
all of the Company's operating assets and will leave the Company without any
operating business with which to generate revenues or profits.

Asset Impairment

     The Company evaluates the recoverability and carrying value of its
long-lived assets at each balance sheet date, based on guidance in SFAS No. 142,
Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to
Be Disposed Of. Among other factors considered in such evaluation is the
historical and projected operating performance of business operations, the
operating environment and business strategy, competitive information and market
trends. The Company recognized a charge of $52,584, $493,905, and $1,436,078
during the years ending December 31, 2002, 2001 and 2000 respectively for asset
impairment.

     Investment in iDefense

     During the fourth quarter of year 2000, the Company recognized an
impairment loss of $329,270 with no associated tax benefit, related to its
investment in iDefense (See Note 12). The Company identified conditions
including the continued losses of iDefense, the difficulty iDefense had in
obtaining additional financing, as well as significant reductions in valuations
of Internet related companies. The Company believed that these items were all
indicators of asset impairment. During the second quarter of year 2001, the
Company recorded an additional impairment charge of $493,905 with no associated
tax benefit to write down the remaining carrying value. Subsequently, on October
19th, 2001 the Company was advised that iDefense had filed Chapter 11 Bankruptcy
in the Eastern District of Virginia, and under the supervision of the Bankruptcy
Court the assets of iDefense had been sold. The sale did not produce sufficient
funds to satisfy iDefense's creditors. The Chapter 11 filing is anticipated to
be converted to Chapter 7 with liquidation of all assets in fractional
satisfaction of outstanding creditor claims. No residual value for stockholders
is anticipated.

     Ganymede Goodwill

     During the second quarter of 2000, the Company recognized a goodwill
impairment charge of $831,310 with no associated tax benefit, related to the
1999 acquisition of Ganymede Corporation ("Ganymede") (See Note 12). The review

                                       20
<PAGE>
<TABLE>
<CAPTION>

for the impairment of these operations was triggered by cash flow losses and
forecasted operating cash flows below those expected at the time that Ganymede
was acquired. Accordingly, the Company concluded that intangible assets were no
longer recoverable through future operations and therefore recognized an
impairment charge related to this asset.

     Fixed Assets

     In the fourth quarter of years 2002 and 2000, the Company recorded charges
of $52,584 and $275,498 respectively, related to the write-down of fixed assets
at its Atlanta operations. These write-downs were a result of the conditions as
outlined above relative to the future of the Company. The Company has suspended
depreciation of its remaining assets.

Intangible Assets

     Intangible assets represented identifiable and unidentifiable intangible
assets related to acquired businesses. Amounts assigned to certain relationships
and licenses were amortized on a straight-line basis over three years; amounts
assigned to retail insurance operations were amortized on a straight-line basis
over seven years; costs in excess of net tangible and identifiable intangible
assets acquired that were recorded as goodwill were amortized on a straight-line
basis over periods ranging from three to five years. As of December 31, 2000 the
remaining intangible assets balance of $557,173 represented the net recoverable
asset in conjunction with the ultimate disposition of the FIMI operations. This
amount was written off in the first quarter of 2001 in conjunction with the
closing of the sale of FIMI to Digital Insurance.

 Principles of Consolidation

     The consolidated financial statements include the accounts of the Company
and its wholly owned subsidiaries, subsequent to acquisition, after the
elimination of all significant intercompany accounts and transactions.

Use of Estimates

     The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and
disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenue and expenses during the reporting
period. Actual results could differ from those estimates.

Cash and Cash Equivalents

     For purposes of the statements of cash flows, management considers all
highly liquid investments with a maturity of three months or less when purchased
to be cash equivalents.

Accounts Receivable, Net

     Accounts receivable are shown net of the allowance for doubtful accounts.

                                             Allowance for Doubtful Accounts
                                           Three Years ended December 31, 2002

    Description           Balance at        Additions (Reductions)             Deductions            Balance at End of
                         Beginning of       Charged to Costs and        (A/R Written Off to Bad           Period
                            Period                Expenses                       Debt)
--------------------     -------------     -----------------------      ------------------------     -----------------
<S>                      <C>               <C>                          <C>                          <C>
Year Ending 12/31/00     $    (215,925)    $                95,060      $                 89,790     $         (31,075)
Year Ending 12/31/01     $     (31,075)    $               (52,321)     $                 14,850     $         (68,546)
Year Ending 12/31/02     $     (68,546)    $               (21,113)     $                 45,926     $         (43,733)


                                       21
</TABLE>
<PAGE>

     Historically, concentration of credit risk with respect to trade accounts
receivable has been generally diversified due to the large number of entities
comprising the customer base. However, the Company's sales to its five largest
customers represented approximately 89% and 97% of total revenues for the years
ended December 31, 2001 and 2002, respectively. During 2001, one customer
accounted for 82% of the revenues of the Company. During 2002, one customer
accounted for 93% of the revenues of the Company. The Company provides an
allowance for accounts which are estimated to be uncollectible.

Furniture, Fixtures and Equipment, Net

     Furniture, fixtures and equipment are recorded at cost less accumulated
depreciation, which is computed using the straight-line method over the
estimated useful lives of the related assets. Furniture and fixtures are
depreciated over a 5 year life; computer equipment is depreciated over a 3 year
life. Assets recorded under capital leases are amortized over the shorter of
their useful lives or the term of the related leases using the straight-line
method. Maintenance and repairs are charged to expense as incurred. Upon sale,
retirement or other disposition of these assets, the cost and the related
accumulated depreciation are removed from the respective accounts and any gain
or loss on the disposition is included in income. The company has suspended
depreciation of its remaining assets.

Fair Value of Financial Instruments

     The carrying amounts of the Company's financial instruments approximates
fair value.

Revenue Recognition

     The Company recognizes revenues on web site development and specialized
software application contracts using the percentage-of-completion method. Earned
revenue is based on the percentage that incurred hours to date bear to total
estimated hours after giving effect to the most recent estimates of total hours.
Earned revenue reflects the original contract price adjusted for agreed upon
claim and change order revenue, if any. If estimated total costs on any of these
contracts indicate a loss, the entire amount of the estimated loss is recognized
immediately. Revenues related to other services are recognized as the services
are performed. Revenues related to insurance product commissions are recognized
upon receipt. Revenues from equipment sales and related costs are recognized
when products are shipped to the customer. Unearned revenue, as reflected on the
accompanying balance sheet, represents the amount of billings recorded on
contracts in advance of services being performed.

     For the year ended December 31, 2000, $2,677,475 in revenue was recognized
under the percentage-of-completion method for fixed price contracts. All
contracts were 100% complete as of the end of the year. Revenues for other
services were recognized at the time the services were provided and consisted of
$583,441 in maintenance services, $9,020 in consulting services and $1,240,041
in web site hosting services.

     For the year ended December 31, 2001, revenues for all services were
recognized at the time the services were provided and consisted of $53,181 in
maintenance services and $1,226,305 in web site hosting services.

     For the year ended December 31, 2002, $9,332 in revenue was recognized
under the percentage-of-completion method for fixed price contracts. The
weighted average completion was 69%. Revenues for other services were recognized
at the time the services were provided and consisted of $16,090 in maintenance
services and $1,459,414 in web site hosting services.

Advertising Expenses

     Advertising costs are expensed when incurred. Advertising expenses were
approximately $216,098, $0 and $0 for the years ended December 31, 2000, 2001
and 2002, respectively.

                                       22
<PAGE>

Income Taxes

     The Company accounts for income taxes using the asset and liability method
as described by Statement of Financial Accounting Standards No. 109, Accounting
For Income Taxes ("SFAS No. 109").

     Under SFAS 109 the liability method is used in accounting for income taxes.
Under this method, deferred tax assets and liabilities are determined based on
differences between financial reporting and tax bases of assets and liabilities
and are measured using the enacted tax rates and laws that will be in effect
when the differences are expected to reverse.

     The Company provides a valuation allowance for deferred tax assets which
are determined by management to be below the threshold for realization
established by SFAS 109.

Basic and Diluted Loss Per Share

     Basic and diluted loss per share are calculated according to the provisions
of Statement of Financial Accounting Standards No. 128, "Earnings per Share"
("FAS 128"). Due to the net loss position of the Company for each of the three
years in the period ending December 31, 2002, the numerator and denominator are
the same for both basic and diluted loss per share.

     The table below illustrates the calculation of the loss per share amounts
attributable to continuing and discontinued operations applicable to common
shareholders.
<TABLE>
<CAPTION>

                                                                 Year Ended December 31,
                                                       --------------------------------------------
                                                           2000            2001            2002
                                                       ------------    ------------    ------------
<S>                                                    <C>             <C>             <C>
Loss from continuing operations                        $ (4,604,452)   $   (847,004)   $    (95,395)
Less: Deemed Preferred stock dividend                    (1,526,728)       (708,778)       (706,733)
                                                       ------------    ------------    ------------
Loss from continuing operations applicable to common
  shareholders                                           (6,131,180)     (1,555,782)       (802,128)
Discontinued operations                                  (4,756,275)        394,543
                                                       ------------    ------------    ------------
Net loss applicable to common shareholders             $(10,887,455)   $ (1,161,239)   $   (802,128)
                                                       ============    ============    ============
Weighted average common shares outstanding--
  Basic and diluted                                       8,549,693       9,869,074      14,999,156
                                                       ------------    ------------    ------------
Loss per share--continuing operations                  $      (0.72)   $      (0.16)   $      (0.01)
Gain (Loss) per share--discontinued operations                (0.55)           0.04
                                                       ------------    ------------    ------------
                                                       $      (1.27)   $      (0.12)   $      (0.01)
                                                       ============    ============    ============


     The Company has not declared or paid any dividends to the shareholders of
the Preferred Stock. However, the Preferred Stock possess conversion rights (the
"Beneficial Conversion Feature") that are analogous to dividends. Accordingly,
the Beneficial Conversion Feature is accounted for as a Deemed Preferred Stock
Dividend. (See footnotes 7, 8, 9 and 10).

Recently Issued Accounting Standards

     The FASB issued SFAS No. 145, Rescission of FASB Statements No. 4, 44, and
64, Amendment of FASB Statement No. 13, and Technical Corrections as of April
2002, which is effective for fiscal years beginning after May 15, 2002. SFAS No.
145 rescinds SFAS No. 4 and SFAS No. 64, which generally required that all gains
and losses from extinguishment of debt be aggregated, and classified as an
extraordinary item. Management does not expect the adoption of this Statement to
have a material impact on the Company's financial condition or results of
operations.

                                       23
</TABLE>
<PAGE>

     In July 2002 the FASB issued SFAS 146, "Accounting for Costs Associated
with Exit or Disposal Activities," which addresses financial accounting and
reporting for costs associated with exit or disposal activities. SFAS 146
requires that a liability for a cost associated with an exit or disposal
activity be recognized when the liability is incurred. This Statement also
establishes that fair value is the objective for initial measurement of the
liability. Severance pay under SFAS 146, in many cases, would be recognized over
time rather than up front. The provisions of this Statement are effective for
exit or disposal activities that are initiated after December 31, 2002, with
early application encouraged. Management does not expect the adoption of this
Statement to have a material impact on the Company's financial condition or
results of operations.

     In December 2002, the FASB issued SFAS 148, "Accounting for Stock-Based
Compensation-Transition and Disclosure," which provides alternative methods of
transition for a voluntary change to fair value based method of accounting for
stock-based employee compensation as prescribed in SFAS 123, "Accounting for
Stock-Based Compensation." Additionally, SFAS 148 requires more prominent and
more frequent disclosures in financial statements about the effects of
stock-based compensation. The provisions of this Statement are effective for
fiscal years ending after December 15, 2002, with early application permitted in
certain circumstances. Management does not expect the adoption of this Statement
to have a material impact on the Company's financial condition or results of
operations.

     In November 2002, the FASB Issued FASB interpretation (FIN) No. 45.
"Guarantor's Accounting and Disclosure Requirements for Guarantees, Including
Indirect Guarantees of Indebtedness of Others." FIN No. 45 requires a guarantor
to recognize, at the inception of a qualified guarantee, a liability for the
fair value of the obligation undertaken in issuing the guarantee. FIN No. 45 is
effective on a prospective basis for qualified guarantees issued or modified
after December 31, 2002. Management does not expect adoption of this
Interpretation to have a material impact on the Company's financial condition or
results of operations.

Other Matters

     Certain prior year amounts have been reclassified to conform to current
year presentation.

2. FURNITURE, FIXTURES AND EQUIPMENT, NET

     Furniture, fixtures and equipment, net, are comprised of the following as
of:


                                                               December 31,
                                                           ---------------------
                                                             2001         2002
                                                           --------     --------
Furniture and fixtures                                     $  8,940     $ 29,525
Computer equipment                                           88,961      106,754
                                                           --------     --------
                                                             97,901      136,279
Less: write down to fair value less costs to sell                         52,584
                                                           --------     --------
                                                           $ 97,901     $ 83,695
                                                           ========     ========

     During the year ending December 31, 2000 Furniture, Fixtures and Equipment
were adjusted to reflect estimated realizable value pending sale. This approach
to fixed assets has been maintained during the years ending December 31, 2001
and 2002, given the business conditions outlined above relative to the future of
the Company. During the year ending December 31, 2002 Furniture, Fixtures and
Equipment were again adjusted to reflect estimated realizable value pending
sale.

                                       24
<PAGE>

3. INTANGIBLE ASSETS

    Intangible assets consist of the following:
                                                              December 31,
                                                       -------------------------
                                                          2001           2002
                                                       ---------      ----------
Goodwill                                                 557,173
Less: Write down related to asset impairment
  and sale of division                                  (557,173)
                                                       ---------      ----------
                                                       $       0      $     --
                                                       =========      ==========

     The $557,173 write down in 2001 represents the remaining intangible value
of FIMI that was written off in the process of the closing of the sale. After
the sale of FIMI in 2001 the Company holds no other Intangible Assets.

4. SEGMENT INFORMATION

     Historically, the Company was organized into five separate business units.
The Company determined that its reportable segments were those that were based
on the Company's method of internal reporting, which disaggregated its business
by product and service category into business units. The Company's reportable
segments were: custom Web development (FAST), Internet outsourcing services
(HostAmerica), Internet security services (HISS), Internet Banking, and
InsureRate/FIMI. On June 9, 1998, the Company sold substantially all of the
assets of its HostAmerica Internet outsourcing services business unit to Sage
Acquisition Corp. On October 1, 1999 the Company sold all of the assets of its
HISS unit to Infrastructure Defense, Inc. On January 31, 2001 the Company sold
all of the assets of its InsureRate/FIMI unit to Digital Insurance, Inc. and on
March 15, 2001 the Company sold the remaining assets of its Internet Banking
group to Netzee, Inc. The Company currently operates in a single business
segment.

     The contribution of each historical business segment for the year 2000 to
total discontinued operations is reflected in the following table.

                    Discontinued Operations Segments                 Year Ended
                                                                    December 31,
                                                                        2000
                                                                    -----------
Revenues:
  FIMI                                                              $ 2,497,366
  Internet Banking                                                      465,467
                                                                    -----------
    Totals                                                          $ 2,962,833
                                                                    ===========

Gain (Loss) from Discontinued Operations
  FIMI                                                              $(1,970,584)
  Internet Banking                                                      214,686
                                                                    -----------
    Totals                                                          $(1,755,898)
                                                                    ===========


5. COMMITMENTS AND CONTINGENCIES

     The Company leases office space and equipment under non-cancelable
operating lease agreements expiring through 2003. The Company has previously
entered into capital leases of computer equipment. Future minimum lease payments
under operating leases are $136,489 for the year ending December 31, 2003.

     As of March 12, 2003 we occupy approximately 7,000 square feet in one
office building in Atlanta, Georgia under a lease expiring in October 2003. This
facility serves as our headquarters and computer center. We have also abandoned
an office in New York City where we used to occupy approximately 3,400 square
feet under a lease that expired in January 2003, and abandoned an office in
Atlanta.

                                       25
<PAGE>

     As of December 31, 2002 we have an accrual for real estate disposition
liabilities of approximately $206,000, which we believe will be sufficient to
settle all obligations related to the closing and abandonment of our offices in
New York and Atlanta.

     Rental expense under operating leases was approximately $831,999, $150,307
and $157,772 for the years ended December 31, 2000, 2001 and 2002 respectively.

     Various legal proceedings may arise in the normal course of business.
Additionally, the Company's software and equipment are vulnerable to computer
viruses or similar disruptive problems caused by customers or other Internet
users. Computer viruses or problems caused by third parties could lead to
interruptions, delays or cessation in service to the Company's customers.
Moreover, customers of the Company could use computer files and information
stored on or transmitted to Web server computers maintained by the Company to
engage in illegal activities that may be unknown or undetectable by the Company,
including fraud and misrepresentation, and unauthorized access to computer
systems of others. Furthermore, inappropriate use of the Internet by third
parties could also jeopardize the security of customers' confidential
information that is stored in the Company's computer systems. Any such actions
could subject the Company to liability to third parties. The Company does not
have errors and omissions, product liability or other insurance to protect
against risks caused by computer viruses or other misuse of software or
equipment by third parties. Although the Company attempts to limit its liability
to customers for these types of risks through contractual provisions, there can
be no assurance that these provisions will be enforceable. Management does not
believe that there are currently any asserted or unasserted claims that will
have a material adverse effect on the financial position, results of operations
or cash flows of the Company.

6. EQUITY AND CONVERTIBLE DEBT TRANSACTIONS

     At December 31, 2002, 142,000 warrants were outstanding at a weighted
average exercise price of $5.05.

7. ISSUANCE OF SERIES B PREFERRED STOCK

     The Company issued Series B Preferred Stock totaling $2,500,000 on March
25, 1999 (the "Issuance Date"). The Series B Preferred Stock investors were
issued 125 shares of preferred stock, having a stated value of $20,000 per
share, and 225,000 warrants to purchase common stock at $5.70 per share. The
Company paid offering costs of $216,250 cash plus 25,000 warrants to purchase
common stock at $5.70 per share, resulting in net proceeds to the Company of
$2,283,750 for the preferred shares and warrants.

     The Series B Preferred Stock bears no dividends and is convertible at the
option of the holder at the earlier of 90 days after issuance or the effective
date of a registration statement covering the shares. The warrants are
exercisable at any time and expire five years from the date of issuance.

     The Series B Preferred Stock is convertible into common stock at a
conversion price equal to the lower of (a) the average of the closing price for
four consecutive trading days in the twenty-five consecutive trading days ending
one day prior to the conversion date ($4.86 at the Issuance date) and (b) $5.23.
The number of common shares into which the Series B Preferred Stock is
convertible is determined by dividing the stated value of the Series B Preferred
Stock, increased by 5% annually, by the conversion price. As the Series B
Preferred Stock was to be automatically convertible on March 24, 2002, the most
beneficial conversion ratio was determined to include the additional common
shares attributable to the 5% annual increase for the three year period ending
in 2002. After adjustment for this additional benefit the $4.86 conversion price
is reduced to $4.23, the most beneficial conversion price at the Issuance Date.

     In determining the accounting for the beneficial conversion feature, the
Company first allocated the net proceeds of $2,283,750 to the preferred stock
and the warrants based on their relative fair values at the Issuance Date,
resulting in $1,766,217 assigned to the preferred stock and $517,533 assigned to
the warrants as of March 24, 1999. The Company then allocated $899,284 of the
Series B net proceeds to additional paid in capital for the beneficial
conversion feature. The beneficial conversion feature will be recognized as a

                                       26
<PAGE>

deemed dividend to the preferred shareholders over the minimum period in which
the preferred shareholders can realize that return. Approximately $18,000 and
$2,672 of the beneficial conversion was amortized in 2000 and 2001,
respectively. During 1999, 10 shares of Series B Preferred Stock were converted
into 63,317 shares of common stock. During 2000, 97.19 shares of Series B
Preferred Stock were converted into 902,307 shares of common stock.

     The Company has the option to redeem the Series B Preferred Stock after 110
days for 120% of face value. Additionally, if the Company has issued common
stock upon conversion of the Series B Preferred Stock such that 19.99% of the
common stock outstanding is held by the preferred shareholders, the Company must
obtain approval of the shareholders before any more preferred shares can be
converted. If such approval is not obtained within 60 days of notice, the
preferred shareholders may require the Company to repurchase the remaining
Series B Preferred Stock at 120% of face value. The Series B Preferred Stock is
presented outside of permanent equity as the outcome of the shareholder vote,
and possible redemption, is outside of the control of the Company.

     In March of 2002, the outstanding shares of our Series B preferred stock
were scheduled to convert automatically into shares of common stock, pursuant to
the Certificate of Designations governing our Series B preferred stock; however,
because we did not have a sufficient number of authorized shares of Common Stock
available for issuance upon conversion of these shares of Series B preferred
stock, no shares of Series B preferred stock have been converted, and we remain
obligated to convert the remaining shares of Series B preferred stock into
shares of common stock.

8. ISSUANCE OF SERIES C PREFERRED STOCK

     On July 28, 1999, the Company completed a private placement of $3,500,000
principal amount of the Company's Series C Convertible Preferred Stock, par
value $.01 per share (the "Series C Preferred Stock") and warrants to acquire up
to 59,574 shares of Common Stock (the "Series C Preferred Warrants"). The Series
C Preferred Stock has an initial stated value of $20,000 per share, which stated
value increases at the rate of 6% per year (such stated value, as increased from
time to time, is referred to as the "Series C Stated Value"). Each Series C
Preferred Share is convertible, from and after 120 days following the date of
issuance, at the option of the holder, into such number of shares of Common
Stock as is determined by dividing the Series C Stated Value by the lesser of
(a) $5.875, and (b) 82.5% of the average of the closing bid prices for the five
trading days preceding the date of conversion. Any Series C Preferred Stock
issued and outstanding on July 22, 2002 to automatically be converted into
Common Stock at the conversion price then in effect.

     In determining the accounting for the beneficial conversion feature, the
Company first allocated the net proceeds of $3,323,748 to the preferred stock
and the warrants based on their relative fair values at the Issuance Date,
resulting in $3,170,904 assigned to the preferred stock and $152,844 assigned to
the warrants as of July 27, 1999. The Company then allocated $1,678,505 of the
Series C net proceeds to additional paid in capital for the beneficial
conversion feature. The beneficial conversion feature will be recognized as a
deemed dividend to the preferred shareholders over the minimum period in which
the preferred shareholders can realize that return. Approximately $72,000 and
$190 of the beneficial conversion was amortized in 2000 and 2001, respectively.
During 1999, 37.5 shares of Series C Preferred Stock were converted into 281,460
shares of common stock. During 2000, 45.4 shares of Series C Preferred Stock
were converted in to 802,056 shares of common stock. During 2001, 1.63 shares of
Series C Preferred Stock was converted into 5,640,000 shares of Common Stock.

     The Company has the right, in its sole discretion, to redeem, from time to
time, any or all of the Series C Preferred Stock; provided that certain
conditions are met, including the availability of cash, credit or standby
underwriting facilities available to fund the redemption at 120% of the original
purchase price.

     In July 2002, the outstanding shares of our Series C preferred stock were
scheduled to convert automatically into shares of common stock, pursuant to the
Certificate of Designations governing our Series C preferred stock; however,
because we did not have a sufficient number of authorized shares of common stock
available for issuance upon conversion of these shares of Series C preferred
stock, no shares of Series C preferred stock have been converted, and we remain
obligated to convert the remaining shares of Series C preferred stock into
shares of common stock.

                                       27
<PAGE>

     The Series C Preferred Warrants expire on July 27, 2004 and have an
exercise price of $7.34 per share, subject to adjustment under certain
circumstances.

9. ISSUANCE OF SERIES D PREFERRED STOCK

     On September 28, 1999, the Company completed a private placement of
$1,500,000 principal amount of the Company's Series D Convertible Preferred
Stock, par value $.01 per share (the "Series D Preferred Stock") and warrants to
acquire up to 25,000 shares of Common Stock (the "Series D Preferred Warrants").
The Series D Preferred Stock has an initial stated value of $20,000 per share,
which stated value increases at the rate of 6% per year (such stated value, as
increased from time to time, is referred to as the "Series D Stated Value").
Each Series E Preferred Share is convertible, from and after 120 days following
the date of issuance, at the option of the holder, into such number of shares of
Common Stock as is determined by dividing the Series D Stated Value by the
lesser of (a) $5.875, and (b) 82.5% of the average of the closing bid prices for
the five trading days preceding the date of conversion. Any Series D Preferred
Stock issued and outstanding on September 22, 2002 was to automatically be
converted into Common Stock at the conversion price then in effect.

     In determining the accounting for the beneficial conversion feature, the
Company first allocated the net proceeds of $1,423,750 to the preferred stock
and the warrants based on their relative fair values at the Issuance Date,
resulting in $1,387,477 assigned to the preferred stock and $36,273 assigned to
the warrants as of September 28, 1999. The Company then allocated $642,084 of
the Series D net proceeds to additional paid in capital for the beneficial
conversion feature. The beneficial conversion feature will be recognized as a
deemed dividend to the preferred shareholders over the minimum period in which
the preferred shareholders can realize that return. Approximately $280,000 and
$281,000 of the beneficial conversion was amortized in 1999 and 2000,
respectively. During 2000, 73.7 shares of Series D Preferred Stock were
converted into 589,573 shares of common stock.

     The right of the holders of the Series D Preferred Stock to convert their
shares is also subject to the following restrictions: (i) during the period
beginning on the issuance date through the following 90 days, each holder may
not convert more than 25% of the Series D Preferred Stock purchased by such
holder; (ii) during the period beginning on the issuance date through the
following 120 days, each holder may not convert more than 50% of the Series D
Preferred Stock purchased by such holder; and (iii) during the period beginning
on the issuance date through the following 150 days, each holder may not convert
more than 75% of the Series D Preferred Stock purchased by such holder. At any
time after the issuance date, the Company shall have the right, in its sole
discretion, to redeem, from time.

     In September 2002, the outstanding shares of our Series D preferred stock
were scheduled to convert automatically into shares of common stock, pursuant to
the Certificate of Designations governing our Series D preferred stock; however,
because we did not have a sufficient number of authorized shares of common stock
available for issuance upon conversion of these shares of Series D preferred
stock, no shares of Series D preferred stock have been converted, and we remain
obligated to convert the remaining shares of Series D preferred stock into
shares of common stock.

10. ISSUANCE OF SERIES E PREFERRED STOCK

     On April 14, 2000, the Company completed a private placement of $2,127,000
principal amount of the Company's Series E Convertible Preferred Stock, par
value $.01 per share (the "Series E Preferred Stock") and warrants to acquire
66,667 shares of common stock (the "Series E Preferred Warrants"). The Series E
Preferred Stock has an initial stated value of $20,000 per share, which stated
value increases at the rate of 8% per year. Each Series E Preferred Share is
convertible 120 days following the date of issuance, at the option of the
holder, into such number of shares of common stock as is determined by dividing
the Series E Stated Value by the lesser of (a) $3.53, or (b) 82.5% of the
average of the closing bid prices for the five trading days preceding the date
of conversion. Any Series E Preferred Stock issued and outstanding on April 14,
2003 will automatically be converted into common stock at the conversion price
then in effect.

                                       28
<PAGE>

     Pursuant to certain registration rights granted to the investors in the
private placement, we are obligated to file a registration statement under the
Securities Act of 1933 with respect to a minimum of 1,808,293 shares of common
stock issueable upon conversion of the Series E Preferred Stock and exercise of
the Series E Preferred Warrants. The Company is obligated to pay penalties if
the Registration Statement is not filed and/or declared effective within the
specified time periods. As of March 12, 2003, such registration statement has
not been declared effective and penalties are owed to the Series E Preferred
Stock holders. In accordance with the terms of the private placement, penalties
accrue at the rate of 2% per 30 day period of the outstanding purchase price of
the unregistered securities. $637,572 and $638,387 was recorded as a deemed
dividend to the Preferred Stockholders for the years ended December 31, 2001 and
2002, respectively.

     At any time after the issuance date, the Company shall have the right, in
its sole discretion, to redeem, from time to time, any or all of the Series E
Preferred Stock; provided that certain conditions are met, including the
availability of cash, credit or standby underwriting facilities available to
fund the redemption. The redemption price will be calculated as (i) 105% of the
original purchase price for the first 30 days following the issuance date; (ii)
110% of the original purchase price for the next 90 days thereafter and (iii)
120% of the original purchase price after 120 days from the issuance date.

     In determining the accounting for the beneficial conversion feature, the
Company first allocated the net proceeds of $1,855,426 to the Series E Preferred
Stock and the Series E Preferred Warrants based on their relative fair values at
the issuance date, resulting in $1,791,211 assigned to the Series E Preferred
Stock and $64,215 assigned to the Series E Preferred Warrants as of April 14,
2000. The Company then allocated $1,059,347 of the Series E Preferred Stock net
proceeds to additional paid in capital for the beneficial conversion feature.
The beneficial conversion feature will be recognized as a deemed dividend to the
preferred shareholders over the minimum period in which the preferred
shareholders can realize that return. Approximately $905,000, $68,344 and
$68,345 of the beneficial conversion was amortized in 2000, 2001 and 2002,
respectively. The balance of the beneficial conversion feature will be
recognized through April 14, 2003.

     The Series E Preferred Warrants expire on April 14, 2005 and have an
exercise price of $3.35 per share, subject to adjustment under certain
circumstances.

11. STOCK OPTION PLANS

     The Company's Employee Stock Option Plan (the "Stock Option Plan") was
adopted by the Company's stockholders in September 1996. Shares of common stock
may be sold or awarded to officers, key employees and consultants. On March 3,
1999 at a Special Meeting of Stockholders, the Company's stockholders approved
an amendment to the Stock Option Plan which increased the number of shares
reserved for issuance under the Stock Option Plan to 2,000,000. Options granted
under the Stock Option Plan may be either (i) options intended to qualify as
"incentive stock options" under Section 422 of the Internal Revenue Code or (ii)
non-qualified stock options.

     The options granted to purchase shares under the Stock Option Plan. The
options vest 25% per year and expire ten years after the grant date. The
exercise price of the options was at or above the fair market value of the stock
on the grant date.

     The Company's Non-Employee Directors' Stock Option Plan (the "Directors'
Plan") was adopted by the Company's stockholders in September 1996. Shares of
common stock may be sold or awarded to directors who are not officers or
employees of the Company ("Non-Employee Directors"). The Company has reserved
300,000 shares of common stock for issuance under the Directors' Plan.

     The Directors' Plan provides for the automatic granting of an option to
purchase 10,000 shares of common stock to each Non-Employee Director who is
first appointed or elected to the Board of Directors. Also, each Non-Employee
Director is automatically granted an option to purchase 5,000 shares of common

                                       29
<PAGE>

stock on the date of each annual meeting of the Company's stockholders.
Furthermore, the Directors' Plan allows the Board of Directors to make
extraordinary grants of options to Non-Employee Directors.

     Statement of Financial Accounting Standards No. 123, "Accounting for
Stock-Based Compensation" ("FAS 123") requires that companies with stock-based
compensation plans either recognize compensation expense based on new fair value
accounting method or continue to apply the provisions of Accounting Principles
Board Opinion No. 25 "Accounting for Stock Issued to Employees" ("APB 25") and
disclose pro forma net income and earnings per share assuming the fair value
method had been applied.

     The Company has elected to follow APB 25 and related interpretations in
accounting for its employee stock options, however, on September 20, 2000, the
Company re-priced options to purchase its common stock, $.0001 par value, held
by certain employees and certain officers. To be eligible for the re-pricing,
option holders were required to exchange one and one-half old options for each
new option. As such, 587,580 old options were exchanged for 391,719 new options.
Options having an exercise price greater than $0.59, the closing bid price of
Homecom common stock on September 20, 2000, were re-priced to an exercise price
of $0.59. In addition, each option holder agreed to a six month lock-up period
in which they would be precluded from exercising any of their options. According
to FASB Interpretation No. 44 "Accounting for Certain Transactions Involving
Stock Compensation," reductions to the exercise price of a fixed option award
must be accounted for as variable from the date of the modification to the date
the award is exercised, forfeited or expires unexercised. Under variable
accounting, a compensation cost must be recorded based on the intrinsic value of
the award, which is computed as the difference between the exercise price and
the fair value of Homecom's common stock on the date of the re-pricing.
Thereafter, an additional compensation cost must be recorded or reversed based
on the difference between the value of the option at the beginning and end of
the accounting period. The reversal of compensation cost cannot be larger than
accumulated compensation expense incurred. To date, no compensation expense has
been recognized as Homecom's stock price has been below the new exercise price
of $0.59. The Company has recognized no compensation expense for options issued
to employees, non-employees, and non-employee directors.

     Pro forma information regarding loss per share is required by FAS 123 and
has been determined as if the Company had accounted for its employee stock
options under the fair value method of that Statement.

     The fair value for these options was estimated at the date of grant using a
Black-Scholes option pricing model with the following weighted average
assumptions:

                                                           December 31,
                                                   -----------------------------
                                                    2000       2001       2002
                                                   -------    -------    -------
Risk-free interest rate                              5.58%        N/A        N/A
Volatility factors of the expected market price
   of the Company's common stock                       85%       106%       110%
Weighted average expected life of the options      5 years    5 years    5 years
Expected dividend yield                                 0%         0%         0%

     Had compensation cost for the Company's stock-based compensation plans been
determined under the provisions consistent with FAS 123, the Company's net loss
and loss per share for the years ended December 31, 2000, 2001 and 2002 would
have been the pro forma amounts listed below:
<TABLE>

                                                         Year Ended December 31,
                                           -------------------------------------------------
                                                2000               2001             2002
                                           --------------     -------------    -------------
Loss applicable to common shareholders:
 <S>                                       <C>                <C>              <C>
  As reported                              $ (10,887,455)     $ (1,161,239)    $   (802,128)
  Pro forma                                  (11,496,918)       (1,073,237)        (971,837)
Basic and diluted loss per share:
  As reported                                      (1.27)            (0.12)           (0.05)
  Pro forma                                        (1.34)            (0.11)           (0.06)


                                       30
<PAGE>

Option activity under all of the stock option plans is summarized as follows:

                                                                 Year Ended December 31,
                                  ------------------------------------------------------------------------------------
                                             2000                         2001                         2002
                                  --------------------------   --------------------------   --------------------------
                                                  Weighted-                    Weighted-                    Weighted-
                                                   Average                      Average                      Average
                                     Shares       Exercise        Shares       Exercise       Shares        Exercise
                                                    Price                        Price                        Price
                                  -----------    -----------   -----------    -----------   -----------    -----------
Outstanding at beginning of
  year                              1,155,259    $      4.49   $   791,644    $      2.75       389,085    $      2.31
Granted                               924,688           1.17             0           0.00             0           0.00
Exercised                              (4,500)          4.06             0           0.00             0           0.00
Forfeited                          (1,283,803)          3.10      (402,559)          2.87        (1,666)          0.59
                                  -----------                  -----------                  -----------
Outstanding at end of year            791,644           2.75       389,085           2.31       387,419           2.32
                                  ===========                  ===========                  ===========
Options exercisable at year end       348,349           3.52       239,081           3.32       329,419           2.61
                                  ===========                  ===========                  ===========
Shares available for future
  grant                             1,080,187                    1,610,915                    1,612,581
                                  ===========                  ===========                  ===========
Weighted-average fair value
  of options granted during
  the year at the shares'
  fair value                      $      0.40                  $      0.00                  $      0.00
                                  ===========                  ===========                  ===========
</TABLE>

The following table summarizes information about fixed options outstanding at
December 31, 2002.

                                                        Weighted Average
                                                      Remaining Contractual
Exercise Prices                          Shares               Life
---------------                        -----------    ----------------------
$0.59-0.75                                231,095              7.2
$2.18-4.55                                 95,687              6.3
$6.00-6.13                                 60,637              5.4
                                       -----------
                                          387,419              6.3
                                       ===========


12. ACQUISITIONS, DIVESTITURES AND DISCONTINED OPERATIONS

     FIMI/InsureRate

     On March 24, 1999, the Company acquired First Institutional Marketing,
Inc., and certain of its affiliates ("FIMI") of Houston, Texas for total
consideration of $4,236,104, consisting of 1,252,174 shares of common stock. The
acquisition was accounted for as a purchase transaction. The value of the shares
was determined by using the average closing stock price of the two days before
and after the definitive agreement was publicly announced. The resulting
intangible assets were being amortized over a period of approximately 3 to 7
years. Prior to the closing of the acquisition, the Company loaned the
shareholders of FIMI $370,000 ("FIMI notes"). The notes were to be repaid in
either cash or common stock and were collateralized by common stock.
Additionally, the principal shareholders of FIMI were granted 300,000 warrants
to acquire HomeCom common stock at an exercise price of $3.74 per share. Vesting
of the warrants was contingent upon FIMI meeting certain operating goals as
defined in the agreement.

     On January 31, 2001, the Company sold substantially all of the assets of
FIMI and its affiliates to Digital Insurance, Inc. ("Digital") for approximately
$458,000 in cash and the assumption of certain liabilities. Additionally, the
FIMI notes were defaulted on and were exchanged for 123,695 shares of Company
common stock that collateralized the notes. This Common stock was returned to
the Company and has been treated as Treasury stock. It has been valued at
$8,659, or $0.07 per share, the fair market value at closing. Additionally, the
warrants were forfeited. The purchase price was established through arms' length
negotiations between the Company and Digital.

                                       31
<PAGE>

     The Company has removed the results of this discontinued operation from the
continuing operations of the Company for all periods presented. The Company
recorded a loss of approximately $3 million on the sale of the assets of FIMI in
2000.

     Ganymede

     On April 23, 1999, the Company acquired all of the outstanding shares of
Ganymede Corporation ("Ganymede") for total consideration of $1,348,186,
consisting of 185,342 shares of common stock and $100,000 cash. The acquisition
was accounted for as a purchase transaction. The purchase price was allocated to
assets acquired and liabilities assumed based on their estimated fair values at
the time and the resulting intangible assets were being amortized over a period
of approximately 3 to 5 years. Results of operations for Ganymede have been
included with those of the Company for periods subsequent to the date of
acquisition. In June 2000, the company recognized a goodwill impairment charge
of approximately $800,000 with no associated tax benefit, related to this
acquisition (See Note 1).

     HISS

     On October 1, 1999, the Company sold substantially all of the assets of its
HomeCom Internet Security Services ("HISS") division to Infrastructure Defense,
Inc. ("iDefense") for $823,175 in common stock of the non-public acquiror,
certain security audit rights and $200,000 cash, paid in January, 2000. The
purchase price was established through arms' length negotiations between the
Company and iDefense.

     The fair value of the common stock was established at the time of the
transaction based upon the review of recent investment activity in iDefense. The
stated fair value of the stock in the purchase agreement was to be $20.50/share.
As iDefense was a private company, no quoted prices or exchanges were available.
However, iDefense had sold shares for cash in private placement transactions
near year end. iDefense had sold shares for $25.00/share with the investor
receiving the same number of shares for free as an inducement. These
transactions resulted in a transaction with a fair value of $12.50/share. Given
the shares tendered in consideration within the sale, the value of the
investment in iDefense was determined to be $823,175. The sale was an arms'
length transaction and there were no related parties.

     The Company has removed the results of this discontinued operation from the
continuing operations of the Company for all periods presented. The Company
recorded a gain of approximately $1.14 million on the sale of the HISS unit in
1999. Subsequently, the Company has written off its entire investment in
iDefense (See Note 1).

     Internet Banking

     On March 15, 2001, the Company sold substantially all of the assets of its
Internet Banking group to Netzee, Inc. ("Netzee") for $406,603 in cash. The
purchase price was established through arms' length negotiations between the
Company and Netzee. The Company has removed the results of this discontinued
operation from the continuing operations of the Company for all periods
presented. The Company recorded a gain of $394,543 on the sale of the Internet
Banking group in 2001.

                                       32
<PAGE>

13. INCOME TAXES

     Deferred income taxes reflect the net tax effects of temporary differences
between the carrying amounts of assets and liabilities for financial reporting
purposes and the amounts used for income tax purposes. Significant components of
the Company's deferred tax assets and liabilities are as follows, as of:

                                                     December 31,
                                      -----------------------------------------
                                         2000           2001           2002
                                      -----------    -----------    -----------
Temporary differences:
Allowance for uncollectibles          $    12,430    $    27,418    $    17,493
Vacation accrual                                0              0              0
Depreciation                              166,183        (17,828)      (123,052)
Capital losses                                  0        166,629        166,629
Accrued legal fees                              0         24,000         18,000
Accrued settlement                         16,000              0              0
Deferred rent expense                     181,555         96,265         82,726
Cash to accrual adjustment                 70,370         35,185              0
Write-off of employee loans               186,000              0              0
Other accruals                             12,000              0              0
Software development expenses                   0              0              0
Net operating loss carryforward         7,061,664      7,643,728      7,849,024
                                      -----------    -----------    -----------
Deferred tax asset                      7,706,203      7,975,398      8,010,820
Valuation allowance                    (7,706,203)    (7,975,398)    (8,010,820)
                                      -----------    -----------    -----------
Net deferred tax asset                       --             --             --

Acquired intangibles                         --             --             --
                                      -----------    -----------    -----------
Deferred tax liability                       --             --
                                      -----------    -----------    -----------
Net deferred tax asset (liability)    $      --      $      --      $      --
                                      ===========    ===========    ===========

     At December 31, 2002, the Company had net operating loss carryforwards for
income tax purposes of approximately $20 million which begin to expire in 2011.
Realization of these assets is contingent on having future taxable earnings. In
addition, certain stock transactions during 1997 resulted in the Company
incurring an ownership change as defined in Internal Revenue Code Section 382.
The result of this ownership change is to substantially limit the future
utilization of the Company's net operating loss carryforwards as of the change
date. Certain stock transactions occurring in 1998 and 1999 may have resulted in
the Company incurring an ownership change, which may result in a limitation on
the Company's future utilization of net operating loss carryforwards generated
in 1998 and 1999. Based on the cumulative losses in recent years and the
limitation and the use of the Company's net operating losses management believes
that a full valuation allowance should be recorded against the deferred tax
asset.

     The income tax benefit differs from the amounts computed by applying the
Federal statutory rate of 40% to loss before taxes principally as a result of
the recording of the valuation allowance.

14. SUBSEQUENT EVENT

On March 27, 2003, the Company entered into a License and Exchange Agreement
with Eurotech, Ltd. ("Eurotech") and, with respect to Articles V and VI thereof,
Polymate, Ltd. and Greenfield Capital Partners LLC (the "Exchange Agreement").
The Exchange Agreement contemplates that HomeCom will enter into a License
Agreement with Eurotech (the "License Agreement"). Pursuant to the Exchange
Agreement and the License Agreement, Eurotech will license to the Company its
rights to the EKOR, HNIPU and Electro Magnetic Radiography (EMR) technologies.
In exchange for the license of these technologies, the Company will (i) issue to
Eurotech 11,250 shares of Series F preferred stock and 1,069 shares of Series G
preferred stock, both of which are new series of the Company's preferred stock,
and (ii) pay Eurotech a royalty of seven percent

                                       33
<PAGE>

(7.0%) on net sales generated by the licensed technologies and a royalty of four
percent (4.0%) on net sales generated by products and services that are
improvements on the licensed technologies. Closing of this transaction is
subject to a number of conditions, including the Company's delivery of evidence
that: (i) its accounts payable have been reduced to roughly $600,000, and (ii)
the holders of the Company's Series B, C, D and E preferred stock have waived
the mandatory conversion rights granted to them in connection with their
respective shares of preferred stock. The Exchange Agreement provides that,
during the period prior to closing of the sale of the Company's hosting and web
site maintenance business, the financial needs of the hosting and web site
maintenance business will funded by the operations of that business, while the
finances related to the new licensed technologies will be kept separate.


Item  9.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
           FINANCIAL DISCLOSURE

     This disclosure has been omitted from this Annual Report on Form 10-K
pursuant to the Instructions to Item 304 of Regulation S-K.







                                       34
<PAGE>

                                    PART III

Item 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT

Identification of Directors, Executive Officers and Significant Employees

     The names and ages of the directors and executive officers of the Company
as of December 31, 2002 and certain information about them are set forth below.

     Name                         Age       Position
     ----                         ---       --------
     Gia Bokuchava, Ph.D          39        Chief Technical Officer and Director
     Timothy R. Robinson          39        Executive Vice President, Chief
                                              Financial Officer and Director
     Nino Doijashvili, Ph.D.      41        Director of Technical Services
                                              and Director
     David Danovitch              40        Director
     Larry Shatsoff               48        Director
     Michael Sheppard             52        Director

     William Walker resigned from his position as a member of the Board of
Directors in September 2000. In November of 2000, Claude A. Thomas and Daniel A.
Delity resigned from their positions as members of the Board (Ms. Doijashvili
was named to the Board in April 2001 to fill Mr. Thomas' position and Mr.
Danovitch was named to the Board in November 2001 to fill Mr. Delity's position,
until such positions expire). In December of 2000, James Wm. Ellsworth resigned
as a member of the Board (in November 2001, Mr. Shatsoff was named to the Board
to fill Mr. Ellsworth's position until such position expires). Roger Nebel
resigned from his position as a member of the Board in February 2001 (Mr.
Robinson was named to the Board in March 2001 to fill Mr. Nebel's position until
Mr. Nebel's term expires). Harvey Sax resigned from the Board effective March
29, 2001 (in November 2001, Mr. Sheppard was named to the Board to fill Mr.
Sax's position until such position expires).

     The Board is divided into three classes, each of which serves a three-year
term. The Class I directors (Ms. Doijashvili, and Mr. Danovitch, formerly Mr.
Thomas, Mr. Walker and Mr. Delity) were to serve until the 2001 Annual Meeting
of Stockholders. However, because we never had a 2001 Annual Meeting of
Stockholders, they remain on the Board of Directors. The Class II directors (Dr.
Bokuchava and Mr. Robinson, formerly Mr. Nebel) were to serve until the 2002
Annual Meeting of Stockholders. However, because we never had a 2002 Annual
Meeting of Stockholders, they remain on the Board of Directors. The Class III
directors (formerly Messrs. Sax and Ellsworth) were to serve until the 2000
Annual Meeting of Stockholders. However, because we never held the 2000 Annual
Meeting of Stockholders, these individuals remain on the Board of Directors, as
well. Please note, however, that we expect Mr. Robinson, Mr. Bokuchava and Ms.
Doijashvili to resign from the Board of Directors if we complete the sale of
assets to Tulix.

Recent Developments

     On March 21, 2003, Mr. Danovitch and Mr. Shatsoff resigned from the Board
of Directors. The remaining members of the Board of Directors appointed Don V.
Hahnfeldt and Dr. Randolph A. Graves, Jr. to fill the vacancies created by the
resignations of Mr. Danovitch and Mr. Shatsoff, respectively.

Background of our Directors and Executive Officers

     Gia Bokuchava, Ph.D., has served as our Chief Technical Officer since
August 1995. Dr. Bokuchava served as a visiting professor at Emory University
from September 1994 until August 1995 and was employed by the National Library
of Medicine, assisting in the development of Internet based applications, from
January 1995 until August 1995. From July 1990 until September 1994, Dr.
Bokuchava was the Director of The Computer Center at the Institute of Mechanical
Engineering at Georgia Technical University, Tblisi, Georgia (formerly a part of
the Soviet Union). Dr. Bokuchava has taught computer science as a visiting
associate professor at the Universities of Moscow and China. Dr. Bokuchava
received a doctorate in Theoretical Physics from Georgia Technical University,
Tblisi, in 1990. Dr. Bokuchava has been a member of the Board of Directors since
September 1996.

                                       35

<PAGE>

     Timothy R. Robinson has served as our Executive Vice President, Chief
Financial Officer since August 2000. Prior to joining the Company, Mr. Robinson
served as Vice President and Chief Financial Officer of Tanner's Restaurant
Group, Inc. from December of 1996 until January of 2000. Mr. Robinson, a
Certified Public Accountant, served as a senior manager with the firm that is
now known as PricewaterhouseCoopers, LLP from June 1986 to December 1996. Mr.
Robinson graduated from Georgia State University with a Bachelor of Business
Administration, Accounting. Mr. Robinson has been a member of the Board since
March 2001.

     Nino Doijashvili, Ph.D., has served as our Director of Technical Services
since December of 1997. Prior to that Dr. Doijashvili served as one of our
Senior Software Engineers from September 1995 until December 1997. Dr.
Doijashvili served as a visiting professor at Emory University from February
1995 until September 1995. From September 1989 until February 1995, Dr.
Doijashvili was an Associate Professor at the Georgia Technical University,
Tbilisi, Georgia (formerly a part of the Soviet Union) teaching CAD/CAM systems
and computer science. Dr Doijashvili received a doctorate in Computer Science
from Moscow Technical University, Russia in February 1989. Dr. Doijashvili has
been a member of the Board since April 2001.

     David Danovitch, 39, is currently a Senior Partner of NewWest Associates,
LLC, an international firm specializing in business consultancy, Del Rey
Investments, LLC., a merchant banking firm, and NewWest Films, a feature film
production and finance concern. The companies are involved with a variety of
enterprises throughout the world in a variety of industries, including
technology, medical device, entertainment, and energy concerns. Prior to joining
NewWest and Del Rey, Mr. Danovitch was a Managing Director of Cambridge
Partners, a merchant bank with $1.7 billion under management, which focused on
misunderstood or mis-financed companies and assets. Prior to joining Cambridge,
he was a founding principal of Snowden Capital, Inc., a New York City-based
investment banking and direct investment firm focused on serving the corporate
finance needs of middle market companies. Mr. Danovitch received a bachelor of
arts from Kenyon College in 1984, a juris doctor from Suffolk University Law
School in 1987, and an L.L.M. in Taxation from Boston University School of Law
in 1988. He is a member of the District of Columbia, Massachusetts, and New York
bar associations. His honors include having been named by the American Banker -
the primary industry publication - as one of the "50 Most Influential People in
Banking" in 1990. Throughout his career, he has been a speaker at many seminars
and conferences covering a range of issues in a variety of industry and has
served on several boards of directors of both for-profit and not-for-profit
concerns, including, among others, the boards of Imaging Diagnostic Systems,
Inc., Renaissance, Inc., Milestone Pictures, Vidikron of America, Inc., and
Great Clips Mid-Atlantic Regional Companies, Inc. Mr. Danovitch also serves as a
director of Imaging Diagnostic Systems, Inc. and Markland Technologies, Inc.

     Lawrence Shatsoff, 47, is President of Markland Technologies, Inc., a
technology company involved in the sale and marketing of home theater products,
and serves on the board of directors of Markland. Prior to becoming President of
Markland in June 2001, Mr. Shatsoff served from June 2000 to April 2001 in
various executive capacities and as a director of Corzon, Inc., a
telecommunications company. From 1995 to 2000, Mr. Shatsoff was the Vice
President and Chief Operations Officer of DCI Telecommunications, Inc. From 1991
to 1994 he served as Vice President and Chief Operations Officer of Alpha
Products, a computer circuit board sales and manufacturing company. Mr. Shatsoff
graduated in 1975 from Rider College with a B.S. Degree in Decision Sciences and
Computers.

     Michael Sheppard, 51, is the President of Technest Holdings, Inc. Mr.
Sheppard joined Technest in 1997, and heads up the day-to-day strategy of
Technest. Prior to joining Technest, Mr. Sheppard was the Chief Operating
Officer of Freelinq Communications, a provider of real time video-on-demand via
ATM/XDSL technology. Mr. Sheppard has also acted as the Chief Executive Officer
and Chief Operating Officer of several early stage development companies,
overseeing the development of a corporate infrastructure for each company. From
1980 to 1992, Mr. Sheppard served as the President of Lee America, a Westward
Communications Company whose North American holdings included Panavision, Inc.
Mr. Sheppard has an extensive background in the entertainment industry and
received a BA and an MFA in film from New York University.

                                       36

<PAGE>

Recent Developments

     As discussed above, Mr. Hahnfeldt and Dr. Graves have been appointed to
fill the vacancies created by the resignations of Mr. Danovitch and Mr.
Shatsoff. Background information concerning Mr. Hahnfeldt and Dr. Graves is set
forth below.

     Don V. Hahnfeldt, 58, is currently President and Chief Executive Officer of
Eurotech, Ltd. and has been with Eurotech since July 1999. Mr. Hahnfeldt has
expertise in nuclear energy technology, strategic planning, financial management
and a thirty-year background in public and government service. Mr. Hahnfeldt
joined Eurotech after working in municipal management and development in the
State of Washington. Prior to that, Mr. Hahnfeldt served with the United States
Nuclear Submarine Force, as executive leader of the Nuclear Navy. He managed
assets in excess of $17 billion and more than 4000 personnel as Commodore of the
United States Pacific Trident submarines and nuclear facilities.

     Dr. Randolph A. Graves, Jr., 64, currently serves as a Vice President for
Technology of Eurotech, Ltd., a position that he has held since March 2002. As
the Vice President for Technology, Dr. Graves is responsible for Eurotech's
long-range technology agenda, focusing on technology evaluation, acquisition
strategy, and analysis of commercial competitiveness. Dr. Graves served as the
Chairman and CEO of Eurotech from May 1995 until January 1998 and was a member
of the Board of Directors from the date of Eurotech's incorporation until
January 1998, from February 1999 to July 2001, and has again served as a
director since August 2001 to the present. He has also served in several other
capacities for Eurotech over the past three years. Dr. Graves has over
thirty-five years experience with technology development, management and
application. He served twenty-six years with NASA, finishing his career as a
Senior Executive at NASA Headquarters. He has served on numerous managerial and
technical panels and committees including a member of the White House's Federal
Coordinating Council on Science Engineering and Technology Subcommittee on High
Performance Computing and as NASA's member of NATO's Advisory Group on Aerospace
Research and Development Fluid Dynamics Panel. He is currently a member of
George Washington University's National Advisory Council for the School of
Engineering Applied Science. Dr. Graves was awarded a Sloan Fellowship at
Stanford University's Graduate School of Business in 1982. He also received
NASA's Exceptional Performance Award for his managerial activities at NASA
Headquarters.

Section 16(a) Beneficial Ownership Reporting Compliance

     Section 16(a) of the Securities Exchange Act of 1934 requires the officers,
directors and persons who own more than ten percent of the Company's stock, to
file reports of ownership and changes of ownership with the Securities Exchange
Commission (SEC). Officers, directors and greater than ten percent owners are
required by SEC regulations to furnish the Company with copies of all Section
16(a) forms they file.

     Based solely on its review of the copies of such forms received by it, the
Company believes that, to the best of its knowledge, each of its officers,
directors, and greater than ten-percent owners complied with all section 16(a)
filing requirements applicable to them during the year ended December 31, 2002.

Item 11.   EXECUTIVE COMPENSATION

Executive Compensation

     The following table sets forth the total compensation paid or accrued by
the Company in 2002 to its Chief Executive Officer and each executive officer of
the Company whose total annual salary and bonus exceeded $100,000 (each, a
"Named Executive Officer"):

                                       37

<PAGE>
<TABLE>
<CAPTION>

                                                  SUMMARY COMPENSATION TABLE

                                                        Annual                                Long-Term
                                                     Compensation                        Compensation Awards

                                                                                     Number of
                                                                                    Securities
                                                                Other Annual        Underlying        All Other
        Position             Year       Salary        Bonus     Compensation          Options        Compensation
        --------             ----       ------        -----     ------------          -------        ------------
                                                                (1)
<S>                          <C>         <C>
Gia Bokuchava, Ph.D          2002        $105,000
    Chief Technical          2001         105,000
    Officer and Director     2000         102,022                    $66,518

Timothy R. Robinson          2002        $135,000
    Executive Vice           2001         135,000      $25,000
    President, Chief         2000          70,885       30,000                        150,000
    Financial Officer
    and Director

Nino Doijashvili             2002        $102,000
    Director of              2001         102,000
    Technical Services       2000          98,695                     $8,755
    and Director

---------------------
     (1) Pursuant to the employment agreements between the Company and Drs.
     Bokuchava and Doijashvili, Dr. Bokuchava and Dr. Doijashvili were eligible
     to receive cash bonuses to repay certain promissory notes issued by them to
     the Company in connection with their individual purchase of shares of
     Common Stock from the Company in August 1996.

     Each of the Company's executive officers also is eligible to receive cash
     bonuses to be awarded at the discretion of the Compensation Committee of
     the Board of Directors.

     No options were granted to or exercised by named executive officers in
2002. The following table sets forth the value of options held by the executive
officers at December 31, 2002:

         Option Exercises in Last Fiscal Year and Year-End Option Values

                                                           Number of Securities
                               Shares                     Underlying Unexercised          Value of Unexercised
                              Acquired       Value              Options at               In-The-Money Options at
     Executive Officer       on Exercise   Realized          December 31, 2002              December 31, 2002
     -----------------       -----------   --------          -----------------              -----------------
                                                       Unexercisable    Exercisable   Unexercisable   Exercisable
                                                       -------------    -----------   -------------   -----------

Gia Bokuchava, Ph.D                 0            0               0         25,000             $0              $0

Timothy R. Robinson                 0            0          37,500        112,500             $0              $0

Nino Doijashvili                    0            0           8,333         38,095             $0              $0


                                       38
</TABLE>
<PAGE>

Employment Contracts

     We have entered into an employment agreement with Timothy R. Robinson, our
Executive Vice President, Chief Financial Officer and Director. This employment
agreement is subject to early termination as provided therein, including
termination by the Company "for cause," as defined in the employment agreement.
The employment agreement provides for an annual base salary of not less than
$135,000 and for annual bonus compensation up to 30% of base salary. The
employment agreement further provides for a severance payment if termination
occurs for any reason other than for cause, with the minimum amount of such
severance payment to be equal to six months' salary. Further, the employment
agreement provides that any relocation or diminution of title, role or
compensation, as defined in the employment agreement, shall also result in the
payment of a severance amount of not less than six months' salary.

     We have entered into an employment agreement with Gia Bokuchava, our Chief
Technical Officer. This employment agreement is subject to early termination as
provided therein, including termination by the Company "for cause," as defined
in the employment agreement. The employment agreement provides for an annual
base salary of not less than $105,000. The employment agreement further provides
for a severance payment if termination occurs for any reason other than for
cause, with the minimum amount of such severance payment to be equal to nine
months' salary. Further, the employment agreement provides that any relocation
or diminution of title, role or compensation, as defined in the employment
agreement, shall also result in the payment of a severance amount of not less
than nine months' salary.

     Principal employees of the Company, including executive officers, are
required to sign an agreement with the Company (i) restricting the ability of
the employee to compete with the Company during his or her employment and for a
period of eighteen months thereafter, (ii) restricting solicitation of customers
and employees following employment with the Company, and (iii) providing for
ownership and assignment of intellectual property rights to the Company.

     Pursuant to the Tulix Agreement, Mr. Robinson, Mr. Bokuchava and Ms.
Doijashvili, on the one hand, and HomeCom, on the other hand, have agreed to
release one another from all claims arising out of the three executives'
employment with or separation from HomeCom, other than HomeCom claims arising
out of the Tulix Agreement or arising out of any fraud, willful misconduct or
criminal act.

Additional Information with Respect to Compensation Committee

     Historically, the Board of Directors had four standing committees: a
Compensation Committee, an Audit Committee, a Strategic Planning Committee and
an Executive Committee. The Compensation Committee provided recommendations to
the Board of Directors concerning salaries and incentive compensation for
officers and employees of the Company. The Audit Committee recommended our
independent auditors and reviewed the results and scope of audit and other
accounting-related services provided by such auditors. The Strategic Planning
Committee was authorized to work with our investment bankers to identify and
evaluate strategic alternatives for us. The Executive Committee had day-to-day
executive decision-making authority on behalf of the Company, subject to the
overall review and approval of the Board of Directors.

     In connection with the winding down of the operations of HomeCom, these
committees have been disbanded and have not been reconstructed upon the filling
of vacancies on the Board of Directors. There were no changes to the Company's
executive compensation policies in 2002.

Performance Graph

     The graph below compares our cumulative stockholder return on an indexed
basis based on an investment of $100 on May 8, 1997 with the cumulative total
return of the Nasdaq Computer Stocks Index (IXCO) (assuming the reinvestment of
all dividends). The Company has paid no dividends to date.

                                       39

<PAGE>

                     HomeCom                                  Nasdaq Computer
                Communications Inc.       S&P 500 Index        & Data Process
                ------------------        -------------        --------------
05/08/97             100.00                     100.00               100.00
12/31/97             259.37                     119.73               113.06
12/31/98              58.33                     153.95               201.86
12/31/99              53.13                     186.34               426.64
12/31/00                .16                     155.30               237.60
12/31/01                .06                     168.24               179.90
12/31/02                .02                     103.49               114.23
03/24/03                .02                      96.14               111.05


Item 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

<TABLE>
<CAPTION>

Securities Authorized for Issuance under Equity Compensation Plans

The following table presents information as of December 31, 2002:

                                          Equity Compensation Plan Information

                                                                                             Number of securities
                                                                                           remaining available for
                               Number of securities to be         Weighted-average          future issuance under
                                issued upon exercise of           exercise price of       equity compensation plans
                                  outstanding options,           outstanding options,       (excluding securities
    Plan Category                 warrants and rights            warrants and rights        reflected in column (a))
    -------------                 -------------------            -------------------        ------------------------
                                          (a)                             (b)                           (c)
<S>                                           <C>                            <C>                       <C>
Equity Compensation                           329,419                        $2.61                     1,612,581
    Plans approved by
    security holders...

Equity Compensation                               N/A                          N/A                           N/A
    Plans not approved
    by security holders...

                 Total...                     329,419                        $2.61                     1,612,581

Beneficial Ownership of Common Stock

     The following tables provide information as of March 12, 2003, concerning
beneficial ownership of Common Stock by (1) each person or entity known by the
Company to beneficially own more than 5% of the outstanding Common Stock, (2)
each director for the Company, (3) each Named Executive Officer, and (4) all
directors and executive officers of the Company as a group. The information as
to beneficial ownership has been furnished by the respective stockholders,
directors, and executive officers of the Company and, unless otherwise
indicated, each of the stockholders has indicated that they have sole voting and
investment power with respect to the shares beneficially owned. This table
excludes holders of our convertible securities who have agreed to limit the
number of shares of common stock that any such shareholders hold at any one time
to not more than 4.99% of the outstanding shares of our common stock.

                                                              Amount of Nature of
Title of Class       Name of Beneficial Owner (2)          Beneficial Ownership (3)    Percent of Class
--------------       ----------------------------          ------------------------    ----------------
Common               Brittany Capital Management                  5,640,000                  37.6%
Common               Harvey W. Sax (4)                              823,534                   5.5%
Common               George Bokuchava, Ph.D. (5)                     64,559                    (1)
Common               Nino Doijashvili (7)                            42,335                    (1)
Common               Timothy Robinson (6)                           112,500                    (1)
Common               All executive Officers and                                                (1)
                     Directors as a group (Messrs.
                     Bokuchava, Doijashvili and Robinson)           219,394                    (1)
</TABLE>

---------------------------
(1) Less than 1%.

(2) Except as otherwise noted, the street address of each named beneficial owner
is Building 12, Suite 110, 3495 Piedmont Road, Atlanta, Georgia 30305.

(3) Unless otherwise indicated below, the persons and entities named in the
table have sole voting and sole investment power with respect to all shares of
Common Stock beneficially owned, subject to community property laws where
applicable. Shares of Common Stock subject to options that are currently
exercisable or exercisable within sixty days of following the date of this
Report are deemed to be outstanding and to be beneficially owned by the person
holding such options for the purpose of computing the percentage ownership of
such person but are not treated as outstanding for the purpose of computing the
percentage ownership of any other person.

(4) Excludes 5,000 common shares owned by a family member, to which Mr. Sax
disclaims beneficial ownership.

(5) Includes 25,000 shares of Common Stock issuable upon the exercise of options
outstanding as of March 12, 2003 at a weighted average exercise price of $4.48
per share.

(6) Includes 112,500 shares of Common Stock issuable upon the exercise of
options outstanding as of March 12, 2003 at an exercise price of $0.75. Excludes
37,500 shares of Common Stock issuable upon the exercise of options outstanding
held by Timothy Robinson as of March 12, 2003 at an exercise price of $.75 which
are not currently exercisable and which become exercisable more than 60 days
following the date of this Statement.

                                       40

<PAGE>

(7) Includes 38,095 shares of Common Stock issuable upon exercise of options
outstanding as of March 12, 2003 at a weighted average exercise price of $0.59.
Excludes 8,333 shares of Common Stock issuable upon the exercise of options
outstanding as of March 12, 2003 at a weighted average exercise price of $0.59
which are not currently exercisable and which become exercisable more than 60
days following the date of this Statement.

     Currently, there are 17.813 shares of our Series B preferred stock, 90.478
shares of our Series C preferred stock, 1.291 shares of our Series D preferred
stock and 106.35 shares of our Series E preferred stock outstanding. All of
these shares of preferred stock are convertible into shares of our common stock
at any time. If all of these shares were converted into shares of common stock,
we would have an insufficient number of shares of common stock authorized by our
Certificate of Incorporation to support such conversions.

Changes in Control

     Currently, HomeCom is authorized to issue up to 15,000,000 shares of common
stock. On April 8, 2002, HomeCom filed a preliminary proxy statement that
contains a proposal to increase the number of authorized shares of common stock
to 100,000,000. The Board of Directors has subsequently determined to seek
stockholder approval to increase the number of authorized shares of common stock
to 300,000,000. Applicable corporate law requires that this proposal be approved
by the holders of a majority of the outstanding shares of common stock of
HomeCom in order to be implemented. If this proposal is presented to the
stockholders for their approval, and if the stockholders approve the proposal,
holders of outstanding shares of convertible preferred stock will be able to
convert their shares of preferred stock into a large number of shares of common
stock, possibly resulting in a change in control of HomeCom. Assuming a market
price of the common stock of $.05 per share, the outstanding shares of HomeCom's
Series B preferred stock, Series C preferred stock, Series D preferred stock and
Series E preferred stock are currently convertible into 104,505,000 shares of
HomeCom common stock. Obviously, we cannot predict how our stock price may
change in the future, and the stock price presented in the previous sentence is
intended only to illustrate the conversion features of our preferred stock. Any
change in our stock price will cause a change in the number of shares of common
stock into which our preferred stock is convertible. In addition, shares of
Series F preferred stock and Series G preferred stock will also become
convertible into shares of common stock, as more fully described in "PART I.
Item 1: Business, Recent Developments."

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Transactions with Management and Others

     We have entered into an agreement with Tulix to sell substantially all of
the assets used in our hosting and web site maintenance business to Tulix.
Timothy R. Robinson, Gia Bokuchava and Nino Doijashvili, who are officers and
directors of both HomeCom and Tulix, own all of the outstanding stock of Tulix.
Pursuant to the agreement with Tulix, we would sell these assets to Tulix in
exchange for 15% of the outstanding capital stock of Tulix and a secured note
for approximately $70,000, and Tulix also would assume certain of our
liabilities. The note will be secured by certain assets being sold to Tulix. In
addition, the agreement requires that we, Tulix and Mr. Robinson, Mr. Bokuchava
and Ms. Doijashvili (as the holders of the outstanding Tulix stock) enter into a
shareholders' agreement pursuant to which the shares of Tulix stock to be issued
to us will carry certain rights, including rights of first refusal, rights of
co-sale and rights to anti-dilution protection. Tulix will be capitalized with a
total investment of $20,000 from Mr. Robinson, Mr. Bokuchava and Ms.
Doijashvili. (See "PART I. Item 1: Business, Recent Developments").

     We have also entered into the Exchange Agreement and the License Agreement
with Eurotech. Mr. Hahnfeldt and Dr. Graves, who have been elected to serve on
the Board of Directors of HomeCom in connection with the proposed transactions
between HomeCom and Eurotech, are officers and directors of Eurotech. (See "PART
I. Item 1: Business, Recent Developments").

ITEM 14. CONTROLS AND PROCEDURES

     Based on their evaluation as of a date within 90 days of the filing date of
this annual report on Form 10-K, the Company's principal executive and financial
officer has concluded that the Company's disclosure controls and procedures (as
defined in Rules 13a-14(c) and 15d-14(c) of the Securities Exchange Act of 1934)
are effective to ensure that information required to be disclosed by the Company
in its filings under the Securities Exchange Act of 1934 is processed, recorded,
summarized, and reported within the time periods specified in Securities and
Exchange Commission rules and forms. There have been no significant changes in
the Company's internal controls, or in other factors that could significantly
affect its internal controls, since the date of the most recent evaluation.

                                       41

<PAGE>

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES,  AND REPORTS ON FORM 8-K

(A) List of Financial Statements

     (1)  Consolidated Balance Sheets as of December 31, 2001 and December 31,
          2002.

     (2)  Consolidated Statements of Operations for years ended December 31,
          2000, December 31, 2001 and December 31, 2002.

     (3)  Consolidated Statement of Changes in Stockholder's Equity (Deficit)
          for years ended December 31, 2000, December 31, 2001 and December 31,
          2002.

     (4)  Consolidated Statements of Cash Flows for the years ended December 31,
          2000, December 31, 2001 and December 31, 2002.

(B) Exhibits
<TABLE>
<CAPTION>

 Exhibit                                              Description
----------    --------------------------------------------------------------------------------------------
<S>                                                   <C>
2.1         --Asset Purchase Agreement, dated January 31,2001, for the Acquisition of Certain Assets of
              HomeCom Communications, Inc., InsureRate, Inc. and FIMI Securities, Inc. by Digital
              Insurance, Inc.*****

2.2         --Asset Purchase Agreement by and between Netzee, Inc. and HomeCom Communications, Inc. dated
              as of March 15, 2001.*****

2.3         --Asset  Purchase  Agreement by and between HomeCom Communications, Inc. and Tulix Systems,
              Inc., dated March  24, 2003.

2.4         --License and Exchange Agreement, dated March 27, 2003, by and among HomeCom Communications,
              Inc., Eurotech,  Ltd. and, with respect to Articles V and VI thereof, Polymate, Ltd. and
              Greenfield Capital Partners LLC.

3.1         --Restated Certificate of Incorporation of the Registrant.*

3.2         --Restated Bylaws of the Registrant.*

3.3         --Certificate of Designation of Series A Convertible Preferred stock.***

3.4         --Certificate of Designation of Series B Convertible Preferred Stock.**

3.5         --Certificate of Designation of Series C Convertible Preferred Stock (previously filed).

3.6         --Certificate of Designation of Series D Convertible Preferred Stock (previously filed).

3.7         --Certificate of Designation of Series E Convertible Preferred Stock (previously filed).

3.8         --Certificate of Designation of Series F Convertible Preferred Stock.

                                       42

<PAGE>

3.9         --Certificate of Designation of Series G Convertible Preferred Stock.

4.1         --See Exhibits 3.1 and 3.2 for provisions of the Restated Certificate of Incorporation and
              Bylaws of the Registrant defining rights of the holders of Common Stock of the Registrant.*

4.2         --Specimen Stock Certificate.*

4.3         --Form of Warrant.*

10.1        --HomeCom Communications, Inc. Stock Option Plan and form of Stock Option Certificate.*

10.2        --HomeCom  Communications,  Inc.  Non-Employee  Directors  Stock Option Plan and form of Stock
              Option Certificate.*

10.3        --Employment Agreement between the Registrant and Harvey W. Sax, dated January 1, 1996.*

10.4        --Form of Employment  Agreement  entered into between the Registrant and each of its executive
              officers except Harvey W. Sax.*

10.5        --Lease Agreement between Property Georgia OBJLW One Corporation and the Registrant dated
              January 22, 1996.*

10.6        --Lease and Services  Agreement between Alliance  Greensboro,  L.P. and the Registrant,  dated
              June 25, 1996.*

10.7        --Business Alliance Program Agreement between Oracle Corporation and the Registrant, dated
              May 30, 1996, together with the Sublicense Addendum, Application Specific Sublicense
              Addendum, Full Use and Deployment Sublicense Addendum and License Transfer Policy, each
              dated May 30, 1996.*

10.8        --Network Enrollment Agreement between Apple Computer, Inc. and the Registrant,  effective May
              1996.*

10.9        --Member Level Agreement  between  Microsoft  Corporation  and the  Registrant,  effective May
              1996.*

10.10       --Master Agreement for internet Services and Products between BBN Planet Corporation and the
              Registrant, dated February1, 1996.*

10.11       --Authorized Business Partners Agreement between BBN Planet Corporation and the Registrant,
              dated May 14, 1996.*

10.12       --Stock Purchase Agreement between the Registrant and the stockholders of HomeCom internet
              Security Services, Inc., dated August 31, 1996.*

10.13       --Form of Promissory Notes issued by the Registrant and held by Mark Germain.*

10.14       --Form of Promissory  Notes issued by the  Registrant  and held by Esther Blech and the Edward
              A. Blech Trust.*

10.15       --Marketing  Associate  Solution  Alliance  Agreement  dated  February  6,  1997  between  the
              Registrant and Unisys Corporation.*

                                       43

<PAGE>

10.16       --Marketing  Associate  Agreement  dated  February 6, 1997 between the  Registrant  and Unisys
              Corporation.**

10.17       --Letter  agreement  dated  January 16, 1997 between the  Registrant,  David A. Blech,  Esther
              Blech and the Edward A. Blech Trust.*

10.18       --HomeCom Communications, Inc. Employee Stock Purchase Plan.*

10.19       --5% Convertible  Debenture Purchase Agreement dated effective  September 19, 1997 between the
              Registrant,  euro factors International,  Inc., Beauchamp Finance, FTS Worldwide Corporation
              and CPLBO.***

10.20       --Form of 5%  Convertible  Debenture  issued  by the  Registrant  and  held  by  Euro  Factors
              International, Inc., Beauchamp Finance, FTS Worldwide Corporation and COLBO.***

10.21       --Registration Rights Agreement dated effective September 19, 1997 between the Registrant,
              Euro Factors International, Inc., Beauchamp Finance, FTS Worldwide Corporation and COLBO.***

10.22       --Letter agreement dated September 23, 1997 between the Registrant, Euro Factors
              International, Inc., Beauchamp Finance, FTS Worldwide Corporation and COLBO.***

10.23       --Letter agreement dated September 27, 1997 between the Registrant, Euro Factors
              International, Inc., Beauchamp Finance, FTS Worldwide Corporation and COLBO.***

10.24       --Form of Warrant to purchase 200,000 shares of Common Stock at an exercise price of $4.00
              per share issued by the Registrant to First Granite Securities, Inc.***

10.25       --Form of Warrant to purchase 200,000 shares of Common Stock at an exercise price of $6.00
              per share issued by the Registrant to First Granite Securities, Inc.***

10.26       --Form of Securities Purchase Agreement between the Registrant, Sovereign Partners, L.P. and
              Dominion Capital Fund, LTD. dated as of December 23, 1997.***

10.27       --Form of Registration Rights Agreement between the Registrant,  Sovereign Partners,  L.P. and
              Dominion Capital Fund, LTD. dated as of December 23, 1997.***

10.28       --Form of Warrant to purchase  18,750 shares of Common Stock issued by the Registrant to
              Sovereign Partners, L.P.***

10.29       --Form of Warrant to purchase 56,250 shares of Common Stock issued by the Registrant to
              Dominion Capital Fund, LTD.***

10.30       --Common Stock Purchase Agreement dated January 23, 1998 by and among  InsureRate,  Inc., the
              Registrant, Jerome R. Corsi and Hamilton Dorsey Alston HomeCom.***

10.31       --Escrow  Agreement dated as of January  23, 1998 by and among InsureRate,  Inc., Hamilton
              Dorsey Alston HomeCom, the Registrant, Jerome R. Corsi and SunTrust Bank, Atlanta.***

10.32       --Shareholders Agreement dated January 23, 1998 by and among Hamilton Dorsey Alston HomeCom,
              the Registrant and InsureRate, Inc.***

10.33       --Web  development and  Hosting Services Agreement dated January 23, 1998, by and among
              InsureRate, Inc. and Hamilton Dorsey Alston HomeCom.***

                                       44

<PAGE>

10.34       --Form of Warrant to purchase 25,000 shares of Common Stock for an aggregate purchase price
              of $92,500 by the Registrant to Hamilton Dorsey Alston HomeCom.***

10.35       --Loan Agreement dated January 23, 1998 by and between InsureRate, Inc. and the Registrant.***

10.36       --Form of Master Note issued by the Registrant to InsureRate, Inc.***

10.37       --Form of Warrant to purchase  50,000  shares of Common Stock issued by the  Registrant to The
              Malachi Group, Inc.+

10.38       --Letter Agreement, dated April 8, 1998 by and among HomeCom, Eurofactors International Inc.,
              Blauchamp France, FTS Worldwide Corporation and COLBO.****

10.39       --Letter  Agreement, dated April 8, 1998 by and between First Granite Securities, Inc. and
              HomeCom.****

10.40       --Letter  Agreement, dated April 17, 1998 by and among Sovereign Partners, L.P., Dominion
              Capital Fund and HomeCom.****

10.41       --Agreement and Plan of Reorganization by and among The Insurance Resource Center,  Inc., Tim
              Strong, James Higham, Cameron M. Harris & HomeCom and HomeCom, dated as of April15, 1998.***

10.42       --Employment Agreement by and between HomeCom and Tim Higham, dated as of April 16, 1998.***

10.44       --Asset Purchase  Agreement by and between HomeCom and Sage Networks Acquisition Corp.dated
              as of June 10, 1998.+

10.45       --Escrow  Agreement by and between HomeCom and Sage Networks  Acquisition Corp. dated as of
              June 10, 1998.+

10.46       --Transitional  Services Agreement by and between HomeCom and Sage Networks Acquisition Corp.
              dated as of June 10, 1998.+

10.47       --Co-Location Agreement by and between HomeCom and Sage Networks, Inc. dated as of June 10,
              1998.+

10.48       --Agreement and Plan of Merger by and among HomeCom Communications, Inc, FIMI Securities
              Acquisitions Corp., Inc., ATF Acquisition  Corp., Inc. and Daniel A. Delity, James Wm.
              Ellsworth, and David B. Frank dated as of November 6, 1998, together with exhibits.++

10.50       --Securities Purchase Agreement dated as of  March 25, 1999 by and among HomeCom
              Communications, Inc. and CPR (USA), Inc., Liberty View Funds, L.P., and Liberty View Fund,
              L.L.C.++

10.51       --Registration Rights Agreement dated as of March 25, 1999 by and among HomeCom
              Communications, Inc. and CPR (USA), Inc., Liberty View Funds, L.P., and Liberty View Fund,
              L.L.C.++

10.52       --Transfer Agent Instructions dated as of March 25, 1999.++

                                       45

<PAGE>

10.53       --Transfer Agent Legal Opinion dated as of March 25, 1999.++

10.54       --Placement Agency Agreement dated as of March 25, 1999 by and between HomeCom Communications,
              Inc. and J.P. Turner & Company, L.L.C.++

10.55       --Stock  Purchase  Agreement  by and among  HomeCom  Communications,  Inc. and Richard L. Chu,
              Joseph G. Rickard,  John R. Winans, Mario D'Agostino,  Karen Moore, and John Kokinis,  dated
              as of April 23, 1999.+++

10.56       --Employment Agreement Between Ganymede Corporation and Richard L. Chu, dated as of April 23,
              1999.+++

10.57       --Employment Agreement  between Ganymede Corporation and John Winans, dated as of April 23,
              1999.+++

10.58       --Employment Agreement between Ganymede Corporation and Joseph G. Rickard, dated as of April
              23, 1999.+++

10.59       --Escrow  Agreement by and among HomeCom Communications, Inc. and Richard L. Chu, Joseph G.
              Rickard, John R. Winans, Mario D'Agostino, Karen Moore, and John Kokinis, dated as of April
              23, 1999.+++

10.60       --Pledge and Security Agreement by and between HomeCom Communications, Inc.and Richard L.
              Chu, Joseph G. Rickard,  John R. Winans, Mario D'Agostino, Karen Moore, and John Kokinis,
              dated as of April 23, 1999.+++

10.61       --Warrant Agreement, dated as of March 25, 1999, by and among CPR (USA), Inc. and HomeCom
              Communications, Inc.++++

10.62       --Warrant Agreement, dated as of March 25, 1999, by and among Liberty View Fund, L.L.C. and
              HomeCom Communications, Inc.++++

10.63       --Warrant Agreement, dated as of March 25, 1999, by and among Liberty View,  Funds, L.P. and
              HomeCom Communications, Inc.++++

10.64       --Warrant Agreement, dated as of March 25, 1999, by and among J.P. Turner & Company, L.L.C
              and HomeCom Communications, Inc.++++

10.65       --Securities Purchase Agreement dated as of July 23,  1999 by and among HomeCom
              Communications, Inc. and MacNab LLC (previously filed).

10.66       --Registration Rights Agreement dated as of July 23, 1999 by and among HomeCom
              Communications, Inc. and MacNab LLC (previously filed).

10.67       --Transfer Agent Instructions dated as of September 28, 1999 (previously filed).

10.68       --Transfer Agent Legal Opinion dated as of July 23, 1999 (previously filed).

10.69       --Placement Agency Agreement dated as of July 23, 1999 by and between HomeCom  Communications,
              Inc. and Greenfield Capital Partners (previously filed).

10.70       --Warrant Agreement,  dated as of July 23, 1999, by and between HomeCom Communications, Inc.
              and MacNab LLC (previously filed).

                                       46

<PAGE>

10.71       --Securities Purchase Agreement dated as of September 27, 1999 by and among HomeCom
              Communications, Inc. and Jackson LLC (previously filed).

10.72       --Registration Rights Agreement dated  as of September 27, 1999 by and among HomeCom
              Communications, Inc. and Jackson LLC (previously filed).

10.73       --Transfer Agent Instructions dated as of September 28, 1999(previously filed).

10.74       --Transfer Agent Legal Opinion dated as of September 28, 1999 (previously filed).

10.75       --Placement Agency Agreement dated as of September 27, 1999 by and between HomeCom
              Communications, Inc. and Greenfield Capital Partners (previously filed).

10.76       --Warrant Agreement, dated as of September 27, 1999, by and between HomeCom Communications,
              Inc. and Jackson LLC (previously filed).

10.77       --Asset Purchase Agreement, dated October 1, 1999, by and between HomeCom Communications,
              Inc. and Infrastructure Defense, Inc.+++++

10.78       --Bill of Sale and Assignment, dated October 1, 1999, by and between HomeCom Communications,
              Inc. and Infrastructure Defense, Inc.+++++

10.79       --Non-solicitation and Non-compete Agreement,  Dated October1, 1999, by and between HomeCom
              Communications, Inc. and Infrastructure Defense, Inc.+++++

10.80       --Registration Rights Agreement, October 1, 1999, by and between HomeCom Communications, Inc.
              and Infrastructure Defense, Inc.+++++

10.81       --Form of Opinion of Purchaser's Counsel.+++++

10.82       --Form of Opinion of Seller's Counsel.+++++

10.83       --Referral and Service Agreement, dated October 1, 1999, by and between HomeCom
              Communications, Inc. and Infrastructure Defense, Inc.+++++

10.84       --Value Added Distributor Agreement, dated October 1, 1999 by and between HomeCom
              Communications, Inc. and Infrastructure Defense, Inc.+++++

10.85       --Resignation Letter of Krishan Puri, dated November 1, 1999.++++++

10.86       --Employment Agreement between the Registrant and Timothy R. Robinson dated August 1,
              2000.*******

10.87       --Amendment to employment Agreement between Registrant and George Bokchava dated January 10,
              2001.*******

10.88       --Separation and Release Agreement, dated March 29, 2001, between HomeCom Communications,
              Inc. and Harvey Sax******

21.1        --List of Subsidiaries.***

99.1        --Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (This
              certification is not "filed" for purposes of Section 18 of the Exchange Act [15 U.S.C. 78r]
              or otherwise subject to the liability of that section. Such certification will not be
              deemed to be incorporated by reference into any filing under the Securities Act or the
              Exchange Act, except to the extent that the Company specifically incorporates them by
              reference.)

-----------------------------------------------------------------------------------------------------------
</TABLE>

                                       47
<PAGE>

*             Incorporated herein by reference to exhibit of the same number in
              the Form S-1 Registration  Statement of the Registrant
              (Registration No. 333-12219).

**            Incorporated herein by reference to exhibit of the same number in
              the Form 10-K of the Registrant filed with the Commission on March
              31, 1998.

***           Incorporated herein by reference to exhibit of the same number in
              the Form S-1 Registration Statement of the Registrant
              (Registration No. 333-42599).

****          Incorporated herein by reference to exhibit of the same number in
              Form 8-K of the Registrant filed with the Commission on April 28,
              1998 .
+             Incorporated herein by reference to exhibit of the same number in
              Form 8-K of the Registrant filed with the Commission on June 25,
              1998.

++            Incorporated herein by reference to exhibit of the same number in
              Form 8-K of the Registrant filed with the Commission on November
              18, 1998.

+++           Incorporated herein by reference to exhibit of the same number in
              Form 10-Q/A of the Registrant filed with the Commission on
              November 17, 1999.

+             Incorporated herein by reference to exhibit of the same number in
              Form S-1 Registration Statement of the Registrant(Registration No.
              333-45383).

++            Incorporated herein by reference to exhibit of the same number in
              Form 10-K of the Registrant filed with the Commission on March 31,
              1999.

+++           Incorporated herein by reference to exhibit of the same number in
              Form 8-K of the Registrant filed with the Commission on May 10,
              1999.

++++          Incorporated herein by reference to Registration Statement on Form
              S-3 of the Registrant (Registration No. 333-79761)

+++++         Incorporated herein by reference to exhibit of the same number on
              Form 8-K of the Registrant filed with the Commission on October
              18, 1999.

++++++        Incorporated herein by reference to exhibit of the same number on
              Form 8-K of the Registrant filed with the Commission on November
              5, 1999.

*****         Incorporated herein by reference to exhibit of the same number of
              Form 10-Q of the Registrant filed with the Commission on May 21,
              2001.

******        Incorporated herein by reference to Exhibit 10.1 of Form 10-Q of
              the Registrant filed with the Commission on May 21, 2001.

*******       Incorporated herein by reference to exhibit of the same number of
              Form 10-K of the Registrant filed with the Commission on April 12,
              2001.

(B) Reports on Form 8-K

 On October 7, 2002, we filed a Current Report on Form 8-K to report a change in
our Certifying Public Accountant that had occurred on May 11, 2002.

                                       48
<PAGE>



                                   SIGNATURES

     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, the Registrant has duly caused this report to be signed on
its behalf by the undersigned, thereunto duly authorized.


                          HOMECOM COMMUNICATIONS, INC.

                                BY:  /s/  TIMOTHY R. ROBINSON
                                ------------------------------------------------
                                          Timothy R. Robinson
                                      Executive Vice President and Chief
                                Financial Officer (Principal Accounting Officer)

                                DATE:  April 14, 2003



     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed below by the following persons on behalf of the
Registrant in the capacities and on the dates indicated.

<TABLE>
<CAPTION>

          Signature                               Title                                  Date
          ---------                               -----                                  ----
<S>                               <C>                                                 <C>

/s/ TIMOTHY R. ROBINSON           Vice President - Chief Financial Officer;          April 14, 2003
-------------------------------   Director
    Timothy R. Robinson

/s/ GIA BOKUCHAVA, PH.D.          Chief Technical Officer; Director                  April 14, 2003
-------------------------------
    Gia Bokuchava, Ph.d.

/s/ NINO DOIJASHVILI, PH.D        Director of Technical Services, Director           April 14, 2003
-------------------------------
    Nino Doijashvili, Ph.d.

/s/ DON V. HAHNFELDT              Director                                           April 14, 2003
-------------------------------
    Don V. Hahnfeldt

/s/ DR. RANDOLPH A. GRAVES, JR.   Director                                           April 14, 2003
-------------------------------
    Dr. Randolph A. Graves, Jr.

/s/ MICHAEL SHEPPARD              Vice President;  Director                          April 14, 2003
-------------------------------
    Michael Sheppard

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

                                       49
</TABLE>
<PAGE>

                                  CERTIFICATION


     I, Timothy R. Robinson, Vice President and Chief Financial Officer of
HomeCom Communications, Inc., certify that:

     1. I have reviewed this annual report on Form 10-K of HomeCom
Communications, Inc.

     2. Based on my knowledge, this annual report does not contain any untrue
statement of a material fact or omit to state a material fact necessary to make
the statements made, in light of the circumstances under which such statements
were made, not misleading with respect to the period covered by this annual
report;

     3. Based on my knowledge, the financial statements, and other financial
information included in this annual report, fairly present in all material
respects the financial condition, results of operations and cash flows of the
registrant as of, and for, the periods presented in this annual report;

     4. The registrant's other certifying officers and I are responsible for
establishing and maintaining disclosure controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

          a. designed such disclosure controls and procedures to ensure that
material information relating to the registrant, including its consolidated
subsidiaries, is made known to us by others within those entities, particularly
during the period in which this annual report is being prepared;

          b. evaluated the effectiveness of the registrant's disclosure controls
and procedures as of a date within 90 days prior to the filing date of this
annual report (the "Evaluation Date"); and

          c. presented in this annual report our conclusions about the
effectiveness of the disclosure controls and procedures based on our evaluation
as of the Evaluation Date;

     5. The registrant's other certifying officers and I have disclosed, based
on our most recent evaluation, to the registrant's auditors and the audit
committee of registrant's board of directors (or persons fulfilling the
equivalent functions):

          a. all significant deficiencies in the design or operation of internal
controls which could adversely affect the registrant's ability to record,
process, summarize and report financial data and have identified for the
registrant's auditors any material weaknesses in internal controls; and

          b. any fraud, whether or not material, that involves management or
other employees who have a significant role in the registrant's internal
controls; and

     6. The registrant's other certifying officers and I have indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date:  April 14, 2003

                           By: /s/  Timothy R. Robinson
                               Name:  Timothy R. Robinson
                               Title: Vice President and Chief Financial Officer

                                       50
<PAGE>
<TABLE>
<CAPTION>

EXHIBIT INDEX


 Exhibit                                              Description
----------    ---------------------------------------------------------------------------------------------

<S>          <C>
2.1         --Asset Purchase Agreement, dated January 31,2001, for the Acquisition of Certain Assets of
              HomeCom Communications, Inc., InsureRate, Inc. and FIMI Securities, Inc. by Digital
              Insurance, Inc.*****

2.2         --Asset Purchase Agreement by and between Netzee, Inc. and HomeCom Communications, Inc. dated
              as of March 15, 2001.*****

2.3         --Asset  Purchase  Agreement by and between HomeCom Communications,  Inc. and Tulix Systems,
              Inc., dated March 24, 2003.

2.4         --License and Exchange Agreement, dated March 27, 2003, by and among HomeCom Communications,
              Inc., Eurotech, Ltd. and, with respect to Articles V and VI thereof, Polymate, Ltd. and
              Greenfield Capital Partners LLC.

3.1         --Restated Certificate of Incorporation of the Registrant.*

3.2         --Restated Bylaws of the Registrant.*

3.3         --Certificate of Designation of Series A Convertible Preferred stock.***

3.4         --Certificate of Designation of Series B Convertible Preferred Stock.**

3.5         --Certificate of Designation of Series C Convertible Preferred Stock (previously filed).

3.6         --Certificate of Designation of Series D Convertible Preferred Stock (previously filed).

3.7         --Certificate of Designation of Series E Convertible Preferred Stock (previously filed).

3.8         --Certificate of Designation of Series F Convertible Preferred Stock.

3.9         --Certificate of Designation of Series G Convertible Preferred Stock.

4.1         --See Exhibits 3.1 and 3.2 for provisions of the Restated
              Certificate of Incorporation and Bylaws of the Registrant defining
              rights of the holders of Common Stock of the Registrant.*

4.2         --Specimen Stock Certificate.*

4.3         --Form of Warrant.*

10.1        --HomeCom Communications, Inc. Stock Option Plan and form of Stock Option Certificate.*

10.2        --HomeCom Communications, Inc. Non-Employee Directors Stock Option Plan and form of Stock
              Option Certificate.*

10.3        --Employment Agreement between the Registrant and Harvey W. Sax, dated January 1, 1996.*

10.4        --Form of Employment Agreement entered into between the Registrant and each of its executive
              officers except Harvey W. Sax.*

10.5        --Lease Agreement between Property Georgia OBJLW One Corporation
              and the Registrant dated January 22, 1996.*

                                       51

<PAGE>

10.6        --Lease and Services Agreement between Alliance  Greensboro, L.P. and the Registrant, dated
              June 25, 1996.*

10.7        --Business Alliance Program Agreement between Oracle Corporation
              and the Registrant, dated May 30, 1996, together with the
              Sublicense Addendum, Application Specific Sublicense Addendum,
              Full Use and Deployment Sublicense Addendum and License Transfer
              Policy, each dated May 30, 1996.*

10.8        --Network Enrollment Agreement between Apple Computer, Inc. and the Registrant, effective May
              1996.*

10.9        --Member Level Agreement between Microsoft Corporation and the Registrant, effective May
              1996.*

10.10       --Master Agreement for internet Services and Products between BBN
              Planet Corporation and the Registrant, dated February1, 1996.

10.11       --Authorized Business Partners Agreement between BBN Planet
              Corporation and the Registrant, dated May 14, 1996.*

10.12       --Stock Purchase Agreement between the Registrant and the
              stockholders of HomeCom internet Security Services, Inc., dated
              August 31, 1996.*

10.13       --Form of Promissory Notes issued by the Registrant and held by Mark Germain.*

10.14       --Form of Promissory Notes issued by the Registrant and held by Esther Blech and the Edward
              A. Blech Trust.*

10.15       --Marketing Associate Solution  Alliance Agreement dated February 6, 1997 between the
              Registrant and Unisys Corporation.*

10.16       --Marketing Associate Agreement dated February 6, 1997 between the Registrant and Unisys
              Corporation.**

10.17       --Letter agreement dated January 16, 1997 between the Registrant, David A. Blech,  sther
              Blech and the Edward A. Blech Trust.*

10.18       --HomeCom Communications, Inc. Employee Stock Purchase Plan.*

10.19       --5% Convertible Debenture Purchase Agreement dated effective September 19, 1997 between the
              Registrant, euro factors International, Inc., Beauchamp Finance, FTS Worldwide Corporation
              and CPLBO.***

10.20       --Form of 5% Convertible Debenture issued by the Registrant and held by Euro Factors
              International, Inc., Beauchamp Finance, FTS Worldwide Corporation and COLBO.***

10.21       --Registration Rights Agreement dated effective September 19, 1997 between the Registrant,
              Euro Factors International, Inc., Beauchamp Finance, FTS Worldwide Corporation and COLBO.***

10.22       --Letter agreement dated September 23, 1997 between the Registrant, Euro Factors
              International, Inc., Beauchamp Finance, FTS Worldwide Corporation and COLBO.***

                                       52

<PAGE>

10.23       --Letter agreement dated September 27, 1997 between the Registrant, EuroFactors
              International, Inc., Beauchamp Finance, FTS Worldwide Corporation and COLBO.***

10.24       --Form of Warrant to purchase 200,000 shares of Common Stock at an
              exercise price of $4.00 per share issued by the Registrant to
              First Granite Securities, Inc.***

10.25       --Form of Warrant to purchase 200,000 shares of Common Stock at an
              exercise price of $6.00 per share issued by the Registrant to
              First Granite Securities, Inc.***

10.26       --Form of Securities Purchase Agreement between the Registrant, Sovereign Partners, L.P. and
              Dominion Capital Fund, LTD. dated as of December 23, 1997.***

10.27       --Form of Registration Rights Agreement between the Registrant, Sovereign Partners, L.P. and
              Dominion Capital Fund, LTD. dated as of December 23, 1997.***

10.28       --Form of Warrant to  purchase 18,750 shares of Common Stock issued by the Registrant  to
              Sovereign Partners, L.P.***

10.29       --Form of Warrant to purchase 56,250 shares of Common Stock issued
              by the Registrant to Dominion Capital Fund, LTD.***

10.30       --Common Stock Purchase Agreement dated January 23, 1998 by and among InsureRate, Inc., the
              Registrant, Jerome R. Corsi and Hamilton Dorsey Alston HomeCom.***

10.31       --Escrow  Agreement  dated as of January  23,  1998 by and among InsureRate,  Inc., Hamilton
              Dorsey Alston HomeCom, the Registrant, Jerome R. Corsi and SunTrust Bank, Atlanta.***

10.32       --Shareholders Agreement dated January 23, 1998 by and among Hamilton Dorsey Alston HomeCom,
              the Registrant and InsureRate, Inc.***

10.33       --Web development and Hosting Services Agreement dated January 23, 1998, by and among
              InsureRate, Inc. and Hamilton Dorsey Alston HomeCom.***

10.34       --Form of Warrant to purchase 25,000 shares of Common Stock for an
              aggregate purchase price of $92,500 by the Registrant to Hamilton
              Dorsey Alston HomeCom.***

10.35       --Loan Agreement dated January 23, 1998 by and between InsureRate, Inc. and the Registrant.***

10.36       --Form of Master Note issued by the Registrant to InsureRate, Inc.***

10.37       --Form of Warrant to purchase 50,000 shares of Common Stock issued by the  Registrant to The
              Malachi Group, Inc.+

10.38       --Letter Agreement, dated April 8, 1998 by and among HomeCom,
              Eurofactors International Inc., Blauchamp France, FTS Worldwide
              Corporation and COLBO.****

10.39       --Letter Agreement, dated April 8, 1998 by and between First Granite Securities, Inc. and
              HomeCom.****

10.40       --Letter Agreement, dated April 17, 1998 by and among Sovereign  Partners, L.P., Dominion
              Capital Fund and HomeCom.****

                                       53

<PAGE>

10.41       --Agreement and Plan of Reorganization by and among The Insurance Resource Center, Inc., Tim
              Strong, James Higham, Cameron M. Harris & HomeCom and HomeCom, dated as of April15, 1998.***

10.42       --Employment Agreement by and between HomeCom and Tim Higham, dated as of April 16, 1998.***

10.44       --Asset Purchase Agreement by and between HomeCom and Sage Networks  Acquisition Corp. dated
              as of June 10, 1998.+

10.45       --Escrow Agreement by and between HomeCom and Sage Networks  Acquisition Corp. dated as of
              June 10, 1998.+

10.46       --Transitional Services Agreement by and between HomeCom and Sage Networks Acquisition Corp.
              dated as of June 10, 1998.+

10.47       --Co-Location Agreement by and between HomeCom and Sage Networks, Inc. dated as of June 10,
              1998.+

10.48       --Agreement and Plan of Merger by and among HomeCom Communications,  Inc, FIMI Securities
              Acquisitions Corp.,  Inc.  TF  Acquisition  Corp., Inc. and Daniel A. Delity, James Wm.
              Ellsworth, and David B. Frank dated as of November 6, 1998, together with exhibits.++

10.50       --Securities Purchase Agreement dated as of March 25, 1999 by and among HomeCom
              Communications, Inc. and CPR (USA), Inc., Liberty View Funds, L.P., and Liberty View Fund,
              L.L.C.++

10.51       --Registration Rights Agreement dated as of March 25, 1999 by and among HomeCom
              Communications,  Inc. and CPR (USA),  Inc., Liberty View Funds, L.P., and Liberty View Fund,
              L.L.C.++

10.52       --Transfer Agent Instructions dated as of March 25, 1999.++

10.53       --Transfer Agent Legal Opinion dated as of March 25, 1999.++

10.54       --Placement Agency Agreement dated as of March 25, 1999 by and between HomeCom
              Communications, Inc. and J.P. Turner & Company, L.L.C.++

10.55       --Stock Purchase Agreement by and among HomeCom Communications, Inc. and Richard L. Chu,
              Joseph G. Rickard, John R. Winans, Mario D'Agostino, Karen Moore, and John Kokinis, dated
              as of April 23, 1999.+++

10.56       --Employment Agreement Between Ganymede Corporation and Richard L. Chu, dated as of April 23,
              1999.+++

10.57       --Employment Agreemen  between Ganymede Corporation and John Winans, dated as of April 23,
              1999.+++

10.58       --Employment Agreement between Ganymede Corporation and Joseph G. Rickard, dated as of April
              23, 1999.+++

10.59       --Escrow  Agreement by and among HomeCom Communications, Inc. and Richard L. Chu, Joseph G.
              Rickard, John R. Winans, Mario D'Agostino, Karen Moore, and John Kokinis, dated as of April
              23, 1999.+++

                                       54

<PAGE>

10.60       --Pledge and Security Agreement by and between HomeCom Communications, Inc. and Richard L.
              Chu, Joseph G. Rickard, John R. Winans, Mario  D'Agostino, Karen Moore, and John Kokinis,
              dated as of April 23, 1999.+++

10.61       --Warrant Agreement, dated as of March 25, 1999, by and among CPR (USA), Inc. and HomeCom
              Communications, Inc.++++

10.62       --Warrant Agreement, dated as of March 25, 1999, by and among Liberty View Fund,  L.L.C. and
              HomeCom Communications, Inc.++++

10.63       --Warrant Agreement, dated as of March 25, 1999, by and among Liberty View, Funds, L.P. and
              HomeCom Communications, Inc.++++

10.64       --Warrant  Agreement, dated as of March 25, 1999, by and among J.P. Turner & Company,  L.L.C
              and HomeCom Communications, Inc.++++

10.65       --Securities Purchase Agreement dated as of July  23, 1999 by and among  HomeCom
              Communications, Inc. and MacNab LLC (previously filed).

10.66       --Registration Rights Agreement dated as of July 23, 1999 by and among HomeCom
              Communications, Inc. and MacNab LLC (previously filed).

10.67       --Transfer Agent Instructions dated as of September 28, 1999 (previously filed).

10.68       --Transfer Agent Legal Opinion dated as of July 23, 1999 (previously filed).

10.69       --Placement Agency Agreement dated as of July 23, 1999 by and between HomeCom Communications,
              Inc. and Greenfield Capital Partners (previously filed).

10.70       --Warrant Agreement, dated as of July 23, 1999, by and between HomeCom  Communications,  Inc.
              and MacNab LLC (previously filed).

10.71       --Securities Purchase Agreement dated as of September 27, 1999 by and among HomeCom
              Communications, Inc. and Jackson LLC (previously filed).

10.72       --Registration Rights Agreement dated as of September 27, 1999 by and among HomeCom
              Communications, Inc. and Jackson LLC (previously filed).

10.73       --Transfer Agent Instructions dated as of September 28, 1999(previously filed).

10.74       --Transfer Agent Legal Opinion dated as of September 28, 1999 (previously filed).

10.75       --Placement Agency Agreement dated as of September 27, 1999 by and between HomeCom
              Communications, Inc. and Greenfield Capital Partners (previously filed).

10.76       --Warrant Agreement, dated as of September 27, 1999, by and between HomeCom Communications,
              Inc. and Jackson LLC (previously filed).

10.77       --Asset  Purchase  greement, dated October 1, 1999, by and between HomeCom Communications,
              Inc. and Infrastructure Defense, Inc.+++++

10.78       --Bill of Sale and Assignment, dated October 1, 1999, by and between HomeCom Communications,
              Inc. and Infrastructure Defense, Inc.+++++

                                       55

<PAGE>

10.79       --Non-solicitation and Non-compete Agreement, Dated October 1, 1999, by and between HomeCom
              Communications, Inc. and Infrastructure Defense, Inc.+++++

10.80       --Registration Rights Agreement, October 1, 1999, by and between HomeCom Communications,  Inc.
              and Infrastructure Defense, Inc.+++++

10.81       --Form of Opinion of Purchaser's Counsel.+++++

10.82       --Form of Opinion of Seller's Counsel.+++++

10.83       --Referral and Service Agreement, dated  October 1, 1999, by and between HomeCom
              Communications, Inc. and Infrastructure Defense, Inc.+++++

10.84       --Value Added Distributor Agreement, dated October 1, 1999 by and between HomeCom
              Communications, Inc. and Infrastructure Defense, Inc.+++++

10.85       --Resignation Letter of Krishan Puri, dated November 1, 1999.++++++

10.86       --Employment Agreement between the Registrant and Timothy R. Robinson dated August 1,
              2000.*******

10.87       --Amendment to employment Agreement between Registrant and George Bokchava dated January 10,
              2001.*******

10.88       --Separation and Release  Agreement, dated March 29, 2001, between HomeCom Communications,
              Inc. and Harvey Sax******

21.1        --List of Subsidiaries.***

99.1        --Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. (This
              certification is not "filed" for purposes of Section 18 of the Exchange Act [15 U.S.C. 78r]
              or otherwise subject to the liability of that section. Such certification will not be
              deemed to be incorporated by reference into any filing under the Securities Act or the
              Exchange Act, except to the extent that the Company specifically incorporates them by
              reference.)

-----------------------------------------------------------------------------------------------------------
</TABLE>

*             Incorporated herein by reference to exhibit of the same number in
              the Form S-1 Registration Statement of the Registrant
              (Registration No. 333-12219).

**            Incorporated herein by reference to exhibit of the same number in
              the Form 10-K of the Registrant filed with the Commission on March
              31, 1998.

***           Incorporated herein by reference to exhibit of the same number in
              the Form S-1 Registration Statement of the Registrant
              (Registration No. 333-42599).

                                       56

<PAGE>

****          Incorporated herein by reference to exhibit of the same number in
              Form 8-K of the Registrant filed with the Commission on April 28,
              1998 .
+             Incorporated herein by reference to exhibit of the same number in
              Form 8-K of the Registrant filed with the Commission on June 25,
              1998.

++            Incorporated herein by reference to exhibit of the same number in
              Form 8-K of the Registrant filed with the Commission on November
              18, 1998.

+++           Incorporated herein by reference to exhibit of the same number in
              Form 10-Q/A of the Registrant filed with the Commission on
              November 17, 1999.

+             Incorporated herein by reference to exhibit of the same number in
              Form S-1 Registration Statement of the Registrant(Registration No.
              333-45383).

++            Incorporated herein by reference to exhibit of the same number in
              Form 10-K of the Registrant filed with the Commission on March 31,
              1999.

+++           Incorporated herein by reference to exhibit of the same number in
              Form 8-K of the Registrant filed with the Commission on May 10,
              1999.

++++          Incorporated herein by reference to Registration Statement on Form
              S-3 of the Registrant (Registration No. 333-79761)

+++++         Incorporated herein by reference to exhibit of the same number on
              Form 8-K of the Registrant filed with the Commission on October
              18, 1999.

++++++        Incorporated herein by reference to exhibit of the same number on
              Form 8-K of the Registrant filed with the Commission on November
              5, 1999.

*****         Incorporated herein by reference to exhibit of the same number of
              Form 10-Q of the Registrant filed with the Commission on May 21,
              2001.

******        Incorporated herein by reference to Exhibit 10.1 of Form 10-Q of
              the Registrant filed with the Commission on May 21, 2001.

*******       Incorporated herein by reference to exhibit of the same number of
              Form 10-K of the Registrant filed with the Commission on April 12,
              2001.


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