Note that you receive the message twice in the client: First, you receive a message and check whether it's the "exit" message, then a second message is received and printed. Thus, only the even messages are printed, while the odd ones are used up in the if
condition.
Try changing the client code to this:
while True:
msg = client.recv(1024)
if msg == 'exit':
print '<System>Host disconnected the Server...'
print '<System>Program will shut down in 5 seconds'
time.sleep(5)
break
else:
print msg