BUSINESS LOAN AGREEMENT

        THIS BUSINESS LOAN AGREEMENT is made and entered into this 25th day of
April, 2002 by and between Capitol Communities Corporation, a Nevada
corporation, ("Borrower") and Boca First Capital LLLP, a Florida limited
liability limited partnership ("Lender");

                                   WITNESSETH:

        WHEREAS, Borrower has received prior commercial loans from Lender or has
applied to Lender for a commercial loan or loans and other financial
accommodations, including those which may be described on any exhibit or
schedule attached to this Agreement; and

        WHEREAS, all such loans and financial accommodations together with all
future loans and financial accommodations from Lender to Borrower, are referred
to in this Agreement individually as the "Loan" and collectively as the "Loans";
and

        WHEREAS, Borrower understands and agrees that: (a) in granting,
renewing, or extending any Loan, Lender is relying upon Borrower's
representations, warranties, and agreements, as set forth in this Agreement; (b)
the granting, renewing, or extending of any Loan by Lender at all times shall be
subject to Lender's sole judgment and discretion; and (c) all such loans shall
be and shall remain subject to the following terms and conditions of this
Agreement.

        NOW THEREFORE, in consideration of the mutual benefits accruing to the
respective parties under the provisions of this agreement, the parties agree as
follows:

1.      Term. This Agreement shall be effective as of April 25, 2002, and shall
continue thereafter until all Indebtedness of Borrower to Lender has been
performed in full and the parties terminate this Agreement in writing.

2.      Definitions. The following words shall have the following meanings when
used in this Agreement. Terms not otherwise defined in this Agreement shall have
the meanings attributed to such terms in the Uniform Commercial Code. All
referenced to dollar amounts shall mean amounts in lawful money of the United
States of America.

                A.   Agreement. The word "Agreement" means this Business Loan
Agreement, as this Business Loan Agreement may be amended or modified from time
to time, together with all exhibits and schedules attached to this Business Loan
Agreement from time to time.

                B.   Borrower. The work "Borrower" means Capitol Communities
Corporation, a Nevada corporation. The word "Borrower" also includes, as
applicable, all subsidiaries and affiliates of Borrower as provided below in the
paragraph titled "Subsidiaries and Affiliates."

                C.   CERCLA. The word "CERCLA" means the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980, as amended.

                D.   Cash Flow. The words "Cash Flow" mean net income after
taxes, and exclusive of extraordinary gains and income, plus depreciation and
amortization.

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                E.   Collateral. The word "Collateral" means and includes
without limitation all property and assets granted as collateral security for a
Loan, whether real or personal property, whether granted directly or indirectly,
whether granted now or in the future, and whether granted in the form of a
security interest, mortgage, deed of trust, assignment, pledge, chattel
mortgage, chattel trust, factor's lien, equipment trust, conditional sale, trust
receipt, lien, charge, lien or title retention contract, lease or consignment
intended as a security device, or any other security or lien interest
whatsoever, whether created by law, contract, or otherwise.

                F.   Debt. The word "Debt" means all of Borrower's liabilities
excluding Subordinated Debt.

                G.   ERISA. The word "ERISA" means the Employee Retirement
Income Security Act of 1974, as amended.

                H.   Event of Default. The words "Event Of Default" mean and
include without limitation any of the Events of Default set forth below in the
section titled "EVENTS OF DEFAULT."

                I.   Grantor. The word "Grantor" means and includes without
limitation each and all of the persons or entities granting a Security Interest
in any Collateral for the Indebtedness, including without limitation all
Borrowers granting such a Security Interest.

                J.   Guarantor. The work "Guarantor" means and includes without
limitation each and all of the guarantors, sureties, and accommodation parties
in connection with any Indebtedness.

                K.   Indebtedness. The word "Indebtedness" means in includes
without limitation all Loans, together with all other obligations, debts and
liabilities of Borrower to Lender, or any one or more of them, as well as all
claims by Lender against Borrower, or any one or more of them; whether now or
hereafter existing, voluntary or involuntary, due or not due, absolute or
contingent, liquidated or unliquidated; whether Borrower may be liable
individually or jointly with others; whether Borrower may be obligated as a
guarantor, surety, or otherwise; whether recovery upon such Indebtedness may be
or hereafter may become barred by any statute of limitations; and whether such
Indebtedness maybe or hereafter may become otherwise unenforceable.

                L.   Lender. The word "Lender" means Boca First Capital LLLP, a
Florida limited liability limited partnership, its successors and assigns.

                M.   Liquid Assets. The words "Liquid Assets" mean Borrower's
cash on hand plus Borrower's readily marketable securities.

                N.   Loan. The word "Loan" or "Loans" means and includes without
limitation any and all commercial loans and financial accommodations from Lender
to Borrower, whether now or hereafter existing, and however evidenced, including
without limitation those loans and financial accommodations described herein or
described on any exhibit or schedule attached to this Agreement form time to
time.

                O.   Note. The word "Note" means and includes without limitation
Borrower's promissory note or notes, if any, evidencing Borrower's Loan
obligations in favor of Lender, as well as any substitute, replacement or
refinancing note or notes therefor.

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                P.   Permitted Liens. The word "Permitted Liens: mean:
(a) liens and security interests securing Indebtedness owed by Borrower to
Lender; (b) liens for taxes, assessments, or similar charges either not yet due
or being contested in good faith; (c) liens of materialmen, mechanics,
warehousemen, or carriers, or other like liens arising in the ordinary course of
business and securing obligations which are not yet delinquent; (d) purchase
money liens or purchase money security interests upon or in any property
acquired or held by Borrower in the ordinary course of business to secure
indebtedness outstanding on the date of this Agreement or permitted to be
incurred under the paragraph on this Agreement titled "Indebtedness and Liens";
(e) liens and security interests which, as of the date of this Agreement, have
been disclosed to and approved by the Lender in writing; (f) those liens and
security interests which in the aggregate constitute an immaterial and
insignificant monetary amount with respect to the net value of Borrower's
assets; and (g) those other liens and security interests which are included and
disclosed in the Federal Securities Exchange Commission filings of Borrower
and/or disclosed in the "Stock Exchange Agreement" hereinafter defined.

                Q.   Related Documents. The words "Related Documents" mean and
include without limitation all promissory notes, loan commitments, credit
agreements, loan agreements, environmental agreements, guaranties, security
agreements, mortgages, deeds of trust, and all other instruments, agreements and
documents, whether now or hereafter existing, executed in connection with the
Indebtedness.

                R.   Security Agreement. The words "Security Agreement" mean and
include without limitation, any agreements, promises, covenants, arrangements,
understandings or other agreements, whether created by law, contract, or
otherwise, evidencing, governing, representing, or creating a Security Interest.

                S.   Security Interest. The words "Security Interest" mean and
include without limitation any type of collateral security, whether in the form
of a lien, charge, mortgage, deed of trust, assignment, pledge, chattel
mortgage, chattel trust, factor's lien, equipment trust, conditional sale, trust
receipt, lien or title retention contract, collateral assignment, lease or
consignment intended as a security device, or any other security or lien
interest whatsoever, whether created by law, contract, or otherwise.

                T.   SARA. The word "SARA" means the Superfund Amendments and
Reauthorization Act of 1986 as now or hereafter amended.

                U.   Subordinated Debt. The words "Subordinated Debt" mean
indebtedness and liabilities of Borrower which have been subordinated by written
agreement to indebtedness owed by Borrower to Lender in form and substance
acceptable to Lender.

                V.   Stock Exchange Agreement. That certain Stock Exchange
Agreement of even date herewith entered into by and between Michael G. Todd,
Prescott Investment, L.P., Ken Richardson, and Howard Bloom.

                W.   Tangible Net Worth. The words "Tangible Net Worth" mean
Borrower's total assets excluding all intangible assets (i.e., goodwill,
trademarks, patents, copyrights, organizational expenses, and similar intangible
items, but including leaseholds and leasehold improvements) less total Debt.

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                X.   Working Capital. The words "Working Capital" mean
Borrower's current assets, excluding prepaid expenses, less Borrower's current
liabilities.

3.      Conditions Precedent To Each Advance. Lender's obligation to make the
initial Loan Advance and each subsequent Loan Advance under this Agreement shall
be subject to the fulfillment to Lender's satisfaction of all of the conditions
set forth in this Agreement and in the Related Documents.

                A.   Loan Documents. Borrower shall provide to Lender in form
satisfactory to Lender the following documents for the Loan: (a) the Note; (b)
Security Agreements granting to Lender security interests in the Collateral, (
c) Financing Statements perfecting Lender's Security Interests; (d) evidence of
insurance as required below; and (e) any other documents required under this
Agreement or by Lender or its counsel.

                B.   Borrower's Authorization. Borrower shall have provided in
form and substance satisfactory to Lender properly certified resolutions, duly
authorizing the execution and delivery of this Agreement, the Note and the
Related Documents, and such other authorizations and other documents and
instruments as Lender or its counsel, in their sole discretion, may require.

                C.   Payment of Fees and Expenses. Borrower shall have paid to
Lender all fees, charges, and other expenses which are then due an payable as
specified in this Agreement or any Related Document.

                D.   Representations and Warranties. The representations and
warranties set forth in this Agreement, in the Related Documents, and in any
document or certificate delivered to Lender under this Agreement are true and
correct.

                E.   No Event of Default. There shall not exist at the time of
any advance a condition which would constitute an Event of Default under this
Agreement.

4.      Representations And Warranties. Borrower represents and warrants to
Lender, as of the date of this Agreement, as of the date of each disbursement of
Loan proceeds, as of the date of any renewal, extension or modification of any
Loan, and at all times any Indebtedness exists:

                A.   Organization. Borrower is a corporation which is duly
organized, validly existing, and in good standing under the laws of the state of
Borrower's creation and is validly existing and in good standing in all states
in which Borrower is doing business. Borrower has the full power and authority
to own it properties and to transact the businesses in which it is presently
engaged or presently proposes to engage. Borrower also is duly qualified as a
foreign corporation and is in good standing in all states in which the failure
to so qualify would have a material adverse effect on its business or financial
condition.

                B.   Authorization. The execution, delivery, and performance of
this Agreement and all Related Documents by Borrower, to the extent to be
executed delivered or performed by Borrower, have been duly authorized by all
necessary action

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by Borrower; do not require the consent or approval of any other person,
regulatory authority or governmental body; and do not conflict with, result in a
violation of, or constitute a default under (a) any provision of its articles of
Incorporation or organization, or bylaws, or any agreement or other instrument
binding upon Borrower or (b) any law, governmental regulation, court decree, or
order applicable to Borrower.

                C.   Financial Information. Each financial statement of Borrower
(or any of Borrower's affiliates) supplied to Lender truly and completely
disclosed Borrower's financial condition as of the date of the statement, and
there has been no material adverse change in Borrower's (or any of Borrower's
affiliates) financial condition subsequent to the date of the most recent
financial statement supplied to Lender. Borrower (or any of Borrower's
affiliates) has no material contingent except as disclosed in such financial
statements.

                D.   Legal Effect. The Agreement constitutes, and any instrument
or agreement required hereunder to be given by Borrower when delivered will
constitute, legal, valid and binding obligations of Borrower enforceable against
Borrower in accordance with their respective terms.

                E.   Properties. Except as contemplated by this Agreement or as
previously disclosed in Borrower's financial statements or in writing to Lender
and as accepted by Lender, and except for property tax liens for taxes not
presently due and payable, Borrower owns and has good title to all of Borrower's
properties free and clear of all Security Interests, and has not executed any
security documents or financing statement relating to such properties. All of
Borrower's properties are titled in Borrower's legal name, and Borrower has not
used, or filed a financing statement under, any other name for at least the last
five (5) years.

                F.   Hazardous Substances. The terms "hazardous waste,"
"hazardous substance," "disposal," "release," and "threatened release," as used
in this Agreement shall have the same meanings as set forth in the "CERCLA",
"SARA," the Hazardous Materials Transportation Act, 49 U.S.C. Section 1801, et.
esq., the Rescue Conservation and recovery Act, 42 U.S.C. Section 6901, et seq.,
or other applicable state or Federal laws, rules, or regulations adopted
pursuant to any of the foregoing. Except as disclosed to and acknowledged by
Lender in writing, Borrower represents and warrants that: (a) During the period
of Borrower's ownership of the properties, there has been no use, generation,
manufacture, storage, treatment, disposal, release or threatened release of any
hazardous waste or substance by any person on, under, about or from any of the
properties. (b) Borrower has no knowledge of, or reason to believe that there
has been (i) any use, generation, manufacture, storage, treatment, disposal,
release, or threatened release of any hazardous waste or substance on, under,
about or from the properties by any prior owners or occupants of any of the
properties, or (ii) any actual or threatened litigation or claims of any kind by
any person relating to such matters. (c) Neither Borrower nor any tenant,
contractor, agent or other authorized user of any of the properties shall use,
generate, manufacture, store, treat, dispose of, or release any hazardous waste
or substance on, under, about from the properties by any prior owners or
occupants of any of the properties, or (ii) any actual or threatened litigation
or claims of any kind by any person relating to such matters. (c) Neither
Borrower nor any tenant, contractor, agent or other authorized user of any of
the properties shall use, generate manufacture, store, treat, dispose of, or
release any hazardous waste or substance on, under, about or from any of the
properties; and any such activity shall be conducted in compliance with all
applicable federal, state, and local laws, regulations, and ordinances,
including without limitation those laws, regulations, and ordinances

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described above. Borrower authorizes Lender and its agents to enter upon the
properties to make such inspection and tests as Lender may deem appropriate to
determine compliance of the properties with this section of the Agreement. Any
inspections or tests made by Lender shall be at Borrower's expense and for
Lender's purposes only and shall not be construed to create any responsibility
or liability on the part of the Lender to Borrower or to any other person. The
representations and warranties contained herein are based upon Borrower's due
diligence in investigating the properties for hazardous waste and hazardous
substances. Borrower hereby (a) releases and wives any future claims against
Lender for indemnity or contribution in the event Borrower becomes liable for
cleanup or other costs under any such laws, and (b) agrees to indemnify and hold
harmless Lender against any and all claims, losses, liabilities, damages,
penalties, and expenses which Lender may directly or indirectly sustain or
suffer resulting from a breach of this section of the Agreement or as a
consequence of any use, generation, manufacture, storage, disposal, release or
threatened release occurring prior to Borrower's ownership or interest in the
properties, whether or not the same was or should have been known to Borrower.
The provisions of this section of the Agreement, including the obligation to
indemnify, shall survive the payment of the Indebtedness and the termination or
expiration of this Agreement and shall not be affected by Lender's acquisition
of any interest in any of the properties, whether by foreclosure or otherwise.

                G.   Litigation and Claims. No litigation, claim, investigation,
administrative proceeding or similar action (including those for unpaid taxes)
against Borrower is pending or threatened, and no other event has occurred which
may materially adversely affect Borrower's financial condition or properties,
other than litigation, claims, or other events, if any, that have been disclosed
to and acknowledged by Lender in writing and other than litigation, claims, or
other events, if any, that have been disclosed in the Federal Securities
Exchange Commission filings of Borrower and/or disclosed in the Stock Exchange
Agreement.

                H.   Taxes. To the best of Borrower's knowledge, all tax returns
and reports of Borrower that are or were required to be filed, have been filed,
and all taxes, assessments and other governmental charges have been paid in
full, except those presently being or to be contested by Borrower in good faith
in the ordinary course of business and for which adequate reserves have been
provided.

                I.   Lien Priority. Unless otherwise previously disclosed to
Lender in writing, Borrower (or any of Borrower's affiliates) has not entered
into or granted any Security Agreements, or permitted the filing or attachment
of any Security Interests on or affecting any of the Collateral directly or
indirectly securing repayment of Borrower's Loan and Note, that would be prior
or that may in any way be superior to Lender's Security Interests and rights in
and to such collateral.

                J.   Binding Effect. This Agreement, the Note, all Security
Agreements directly or indirectly securing repayment of Borrower's Loan and
Note, and all of the Related Documents are binding upon Borrower as well as upon
Borrower's successors, representatives and assigns, and are legally enforceable
in accordance with their respective terms.

                K.   Commercial Purposes. Borrower intends to use the Loan
proceeds solely for business or commercial related purposes.

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                L.   Employee Benefit Plans. Each employee benefit plan as to
which Borrower may have any liability complies in all material respects with all
applicable requirements of law and regulations, and (i) no Reportable Event nor
Prohibited Transaction (as defined in ERISA) has occurred with respect to any
such plan, (ii) Borrower has not withdrawn from any such plan or initiated steps
to do so, (iii) no steps have been taken to terminate any such plan, and (iv)
there are no unfunded liabilities other than those previously disclosed to
Lender in writing.

                M.   Location of Borrower's Offices and Records. Borrower's
place of business, or Borrower's Chief executive office, if Borrower has more
than one place of business, is located at 25550 Hawthorne Blvd., Suite 207,
Torrance, CA 90505. Unless Borrower has designated otherwise in writing this
location is also the office or offices where Borrower keeps its records
concerning the Collateral.

                N.   Information. All information heretofore or
contemporaneously herewith furnished by Borrower to Lender for the purposes of
or in connection with this Agreement or any transaction contemplated hereby is,
and all information hereafter furnished by or on behalf of Borrower to Lender
will be, true and accurate in every material respect on the date as of which
such information is dated or certified; and none of such information is or will
be incomplete by omitting to state any material fact necessary to make such
information not misleading.

                O.   Survival of Representations and Warranties. Borrower
understands and agrees that Lender, without independent investigation, is
relying upon the above representations and warranties in making the above
referenced Loan to Borrower. Borrower further agrees that the foregoing
representations and warranties shall be continuing in nature and shall remain in
full force and effect until such time as Borrower's Indebtedness shall be paid
in full, or until this Agreement shall be terminated in the manner provided
above, whichever is the last to occur.

5.      Affirmative Covenants. Borrower covenants and agrees with Lender that,
while this Agreement is in effect, Borrower will:

                A.   Litigation. Promptly inform Lender in writing of (a) all
material adverse changes in Borrower's financial condition, and (b) all existing
and threatened litigation, claims, investigations, administrative proceedings or
similar actions affecting Borrower or any Guarantor which could materially
affect the financial condition of Borrower or the financial condition of any
Guarantor.

                B.   Financial Records. Maintain its books and records in
accordance with generally accepted accounting principles; applied on a
consistent basis, and permit Lender to examine and audit Borrower's books and
records at all reasonable times. At the option of Lender, Borrower shall provide
Lender with periodic certified audited statements of the operations of and the
financial condition of Borrower.

                C.   Financial Statements. Furnish Lender with, as soon as
available, but in no event later than ninety (90) days after the end of each
fiscal year, Borrower's balance sheet and income statement for the year ended,
reviewed by a certified public accountant satisfactory to Lender, and, as soon
as available, but in no event later than ninety (90) days after the end of each
fiscal quarter, Borrower's balance sheet and profit and loss statement for the
period ended, prepared and certified as correct to the best knowledge and belief
by Borrower's chief financial officer of other officer or person acceptable to
Lender. Furnish Lender with, as soon as available, but in no event later

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than thirty (30) days subsequent to the filing date thereof (including
extensions), annual Federal partnership tax returns. All financial reports
required to be provided under this Agreement shall be prepared in accordance
with generally accepted accounting principles, applied on a consistent basis,
and certified by Borrower as being true and correct.

                D.   Additional Information. Furnish such additional information
and statements, lists of assets and liabilities, agings of receivables and
payables, inventory schedules, budgets, forecasts, tax returns, and other
reports with respect to Borrower's financial condition and business operations
as Lender may request from time to time.

6.      Financial Covenants. Comply with the following covenants:

        A.      Insurance. Maintain fire and other risk insurance, public
liability insurance, and such other insurance as Lender may require with respect
to Borrower's properties and operations, in form, amounts, coverages and with
insurance companies reasonably acceptable to Lender as disclosed in the Federal
Securities Exchange Commission filings of Borrower. Borrower, upon request of
Lender, will deliver to Lender from time to time the policies or certificates of
insurance in form satisfactory to Lender, including stipulations that coverages
will not be canceled or diminished without at least thirty (30) days prior
written notice to Lender. Each insurance policy also shall include and
endorsement providing that coverage in favor of Lender will not be impaired in
any way by any act, omission or default of Borrower or any other person. In
connection with all policies covering assets in which Lender holds or is offered
a security interest for the Loans, Borrower will provide Lender with such loss
payable or other endorsements as Lender may require.

                B.   Insurance Reports. Furnish to Lender, upon request of
Lender, reports on each existing insurance policy showing such information as
Lender may reasonably request, including without limitation the following: (a)
the name of the insurer; (b) the risks insured; (c) the amount of the policy;
(d) the properties insured; (e) the then current property values on the basis of
which insurance has be obtained, and the manner of determining those values; and
(f) the expiration date of the policy. In addition, upon request of Lender
(however not more often than annually), Borrower will have an independent
appraiser satisfactory to Lender determine, as applicable, the actual cash value
or replacement cost of any Collateral. The coat of such appraisal shall be paid
by Borrower.

                C.   Other Agreements. Comply with all terms and conditions of
all other agreements, whether now or hereafter existing, between Borrower and
any other party and notify Lender immediately in writing of any default in
connection with any other such agreements.

                D.   Loan Proceeds. Use all of the loan proceeds from the Loan
described in Exhibit "A" attached hereto and by reference made a part hereof
solely for the purposes expressed and set forth in said Exhibit "A".

                E.   Taxes, Charges and Liens. Pay and discharge when due all of
its indebtedness and obligations, including without limitation all assessments,
taxes, governmental charges, levies and liens, of every kind and nature, imposed
upon Borrower or it properties, income, or profits, prior to the date on which
penalties would attach, and all lawful claims that, if unpaid, might became a
lien or charge upon any of Borrower's properties, income, or profits. Provided
however, Borrower will not be

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required to pay and discharge any such assessment, tax, charge, levy, lien or
claim so long as (a) the Legality of the same shall be contested in good faith
by appropriate proceedings, and (b) Borrower shall have established on its books
adequate reserves with respect to such contested assessment, tax, charge, levy,
lien, or claim in accordance with generally accepted accounting practices.
Borrower, upon demand of Lender, will furnish to Lender evidence of payment of
the assessments, taxes, charges, levies, liens and claims and will authorize the
appropriate government official to deliver to Lender at any time a written
statement of any assessments, taxes, charges, levies, liens and claims against
Borrower's properties, income, or profits.

                F.   Performance. Perform and comply with all terms, conditions,
and provisions set forth in this Agreement and in the Related Documents in a
timely manner, and promptly notify Lender if Borrower learns of the occurrence
of any event which constitutes an Event of Default under this Agreement or under
any of the Related Documents.

                G.   Operations. Maintain executive and management personnel
with substantially the same qualifications and experience as the present
executive and management personnel; provide written notice to Lender of any
change in executive and management personnel; conduct its business affairs in a
reasonable and prudent manner and in compliance with all applicable federal,
state and municipal laws, ordinances, rules and regulations respecting its
properties, chargers, businesses and operations, including without limitations,
compliance with the American With Disabilities Act and with all minimum funding
standards and other requirements of ER1SA and other laws applicable to
Borrower's employee benefit plans.

                H.   Inspection. Permit employees or agents of Lender at any
reasonable time to inspect any and all Collateral for the loan or Loans and
Borrower's other properties and to examine or audit Borrower's books, accounts,
and records and to make copies and memoranda of Borrower's books, accounts, and
records. If Borrower now or at any time hereafter maintains any records
(including without limitation computer generated records and computer software
programs for the generation of such records) in the possession of a third party,
Borrower, upon request of Lender, shall notify such party to permit Lender free
access to such records at all reasonable times and to provide Lender with copies
of any records it may request, all at Borrower's expense.

                I.   Compliance Certificate. Unless waived in writing by Lender,
provide Lender at least annually and at the time of each disbursement of Loan
proceeds with a certificate executed by Borrower's chief financial officer, or
other officer or person acceptable to Lender, certifying that the
representations and warranties set forth in this Agreement are true and correct
as of the date of the certificate and further certifying that, as of the date of
the certificate, no Event of Default exists under this Agreement,

                J.   Environmental Compliance and Reports. Borrower shall comply
in all respects with all environmental protection federal, state and local laws,
statutes, regulations and ordinances; not cause or permit to exist, as a result
of an intentional or unintentional action or omission on its part on or the part
of any third party, on property owned and/or occupied by Borrower, any
environmental activity where damage may result to the environment, unless such
environmental activity is pursuant to and in compliance with the conditions of a
permit issued by the appropriate federal, state or local governmental
authorities; shall furnish to Lender promptly and in any event within thirty
(30) days after receipt thereof a copy of any notice, summons, lien,

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<PAGE>

citation, directive, letter or other communication from any governmental agency
or instrumentality concerning any intentional or unintentional action or
omission on Borrower's part in connection with any environmental activity
whether or not there is damage to the environment and/or other natural
resources.

                K.   Additional Assurances. Make, execute and deliver to Lender
such promissory notes, mortgages, deeds of trust, security agreements, financing
statements, instruments, documents and other agreements as Lender or its
attorneys may reasonably request to evidence and secure the Loans and to perfect
all Security Interests.

7.      Negative Covenants. Borrower covenants and agrees with Lender that while
this Agreement is in effect, Borrower shall not, without the prior written
consent of Lender:

                i.   Indebtedness and Liens. (a) Except for trade debt incurred
in the normal course of business and indebtedness for borrowed money, including
capital leases, (b) except as allowed as a Permitted Lien, se!l, transfer,
mortgage, assign, pledge, lease, grant a security interest in, or encumber any
of Borrower's assets, or (c) sell with recourse any of Borrower's accounts,
except to Lender.

                ii.  Continuity of Operations. Except as contemplated by the
Stock Exchange Agreement or as otherwise consented to in writing by Lender
(a) Engage in any business activities substantially different than those in
which Borrower is presently engaged, (b) cease operations, liquidate, merge,
transfer, acquire, or consolidate with any other entity, change ownership,
change its name, dissolve or transfer or sell Collateral out of the ordinary
course of business, (c) pay any dividends on Borrower's stock (other than
dividends payable in its stock), provided, however that notwithstanding the
foregoing, but only so long as no Event of Default has occurred and is
continuing or would result from the payment of dividends, if Borrower is a
"Subchapter S Corporation" (as defined in the Internal Revenue Code of 1986, as
amended), Borrower may pay cash dividends on its stock to its shareholders from
time to time in amounts necessary to enable the shareholder to pay income taxes
and make estimated income tax payments to satisfy their liabilities under
federal and state law which arise solely from their status as Shareholders of a
Subchapter S Corporation because of their ownership of shares of stock of
Borrower, or (d) purchase or retire any of Borrower's outstanding shares or
alter or amend Borrower's capital structure.

                iii. Loans, Acquisitions and Guarantees. (a) Loan, invest in or
advance money or assets, (b) purchase, create or acquire any interest in any
other enterprise or entity, or (c) incur any obligation as surely or guarantor
other than in the ordinary course of business.

8.      Cessation Of Advances. If Lender has made any commitment to make any
Loan to Borrower, whether under this Agreement or under any other agreement,
Lender shall have no obligation to make Loan Advances or to disburse Loan
proceeds if: (a) Borrower or any Guarantor is in default under the terms of this
Agreement or any of the Related Documents or any other agreement that Borrower
or any Guarantor has with Lender; (b) Borrower or any Guarantor become
insolvent, files a petition in bankruptcy or similar proceedings, or is adjudged
a bankrupt; (c) there occurs a material adverse change in Borrower's financial
conditions, in the financial condition of any Guarantor, or in the value of any
Collateral securing any Loan; or (d) any Guarantor seeks, claims or otherwise
attempts to limit, modify or revoke such Guarantor's guaranty of the loan or any
other loan with Lender.

                                       10
<PAGE>

9.      Event Of Default. Each of the following shall constitute an Event of
Default under this Agreement:

                i.   Default on Indebtedness. Failure of Borrower to make any
payment when due on the Loans.

                ii.  Other Defaults. Failure of Borrower or any Grantor to
comply with or to perform when due any other term, obligation, covenant or
condition contained in this Agreement or in any of the Related Documents, or
failure of Borrower to comply with or to perform any other term, obligation,
covenant or condition contained in any other agreement between Lender and
Borrower.

                iii. Default in Favor of Third Parties. Should Borrower or any
Grantor default under any loan, extension of credit, security agreement,
purchase or sales agreement, or any other agreement, in favor of any other
creditor or person that may materially affect any of Borrower's property or
Borrower's or any Grantor's ability to repay the Loans or perform their
respective obligations under this Agreement or any of the Related Documents), or
if any third party commences an action against Borrower or against any
subsidiary of Borrower which action may, in the sole discretion of Lender, have
the ultimate effect of jeopardizing the collateral for the Loan or the assets of
the subsidiary, or the prospect of repayment of the Loan therefrom.

                iv.  False Statements. Any warranty, representation or statement
made or furnished to Lender by or on behalf of Borrower or any Guarantor under
this Agreement or the Related Documents is false or misleading in any material
respect at the time made or furnished, or becomes false or misleading at any
time thereafter.

                v.   Defective Collateralization. This Agreement or any of the
Related Documents ceases to be in full force and effect (including failure of
any Security Agreement to create a valid and perfected Security Interest) at
any time and for any reason.

                vi.  Insolvency. The dissolution or termination of Borrower's
existence as a going business, the insolvency of Borrower, the appointment of a
receiver for any part of Borrower's property, any assignment for the benefit of
creditors, any type of creditor workout, or the commencement of any proceeding
under any bankruptcy or insolvency laws by or against Borrower.

                vii. Creditor of Forfeiture Proceedings. Commencement of
foreclosure or forfeiture proceedings, whether by judicial proceeding,
self-help, repossession or any other method, by any creditor of Borrower, any
creditor of any Grantor against any collateral securing the Indebtedness, or by
any governmental agency. This includes a garnishment, attachment, or levy on or
of any of Borrower's deposit accounts with Lender.

                viii. Events Affecting Guarantor. Any of the preceding events
occurs with respect to any Guarantor of any of the Indebtedness or any Guarantor
dies or becomes incompetent, or revokes or disputes the validity of, or
liability under, any Guaranty of the Indebtedness.

                                       11
<PAGE>

                ix.  Change in Ownership. Except as provided I the Stock
Exchange Agreement, any change in ownership of twenty-five percent (25%) or more
of the corporate interests of Borrower.

                x.   Adverse Change. A material adverse change occurs in
Borrower's financial condition, or Lender believes the prospect of payment or
performance of the Indebtedness is impaired.

10.     Effect Of An Event Of Default. If any Event of Default shall occur,
except where otherwise provided in this Agreement or the Related Documents, all
commitments and obligations of Lender under this Agreement or the Related
Documents or any other agreement immediately will terminate and, at Lender's
option, all Indebtedness immediately will become due and payable, all without
notice of any kind to Borrower, except that in the case of an Event of Default
of the type described in the "Insolvency" subsection above, such acceleration
shall be automatic and not optional. In any addition, Lender shall have all the
rights and remedies provided in the Related Documents or available at law, in
equity, or otherwise. Except as may be prohibited by applicable law, all of
Lender's rights and remedies shall be cumulative and may be exercised singularly
or concurrently. Election by Lender to pursue any remedy shall not exclude
pursuit of any other remedy, and an election to make expenditures or to take
action to perform an obligation of Borrower or of any Grantor shall not affect
Lender's right to declare a default and to exercise its rights and remedies.

11.     Miscellaneous Provisions. The following miscellaneous provisions are
part of this Agreement:

                i.   Amendments. This Agreement, together with any Related
Documents, constitutes the entire understanding and agreement of the parties as
to the matters set forth in this Agreement. No alteration of or amendment to
this Agreement shall be effective unless given in writing and signed by the
party or parties sought to be changed or bound by the alteration or amendment.

                ii.  Applicable Law. This Agreement has been delivered to Lender
and accepted by Lender in the State of Florida. If thers is a lawsuit, Borrower
agrees upon Lender's request to submit to the jurisdiction of the courts of Palm
Beach County County, the State of Florida. This Agreement shall be governed by
and construed in accordance with the laws of the State of Florida.

                iii. Caption Headings. Caption headings in this Agreement are
for convenience purposes only and are not to be used to interpret or define the
provisions of this Agreement.

                iv.  Consent to Loan Participation. Borrower agrees and consents
to Lender's sale or transfer, whether now or later, of one or more
participation interests in the Loans to one or more purchasers, whether related
or unrelated to Lender, Lender may provide, without any limitation whatsoever,
to any one or more purchasers, or potential purchasers, any information or
knowledge Lender may have about Borrower or about any other matter relating to
the Loan, and Borrower hereby waives any rights to privacy it may have with
respect to such matters. Borrower additionally waives any and all notices of
sale of participation interest, as well as all notices of any repurchase of such
participation interests. Borrower also agrees that the purchasers of any such
participation interest will be considered as the absolute owners of such
interest in the

                                       12
<PAGE>

Loans and will have all the rights granted under the participation agreement or
agreements governing the sale of such participation interest. Borrower further
waives all rights of offset or counterclaim that it may have now or later
against Lender or against any purchaser of such a participation interest and
unconditionally agrees that either Lender or such purchaser may enforce
Borrower's obligation under the Loans irrespective of the failure or insolvency
of any holder of any interest in the Loans. Borrower further agrees that the
purchaser of any such participation interest may enforce its interests
irrespective of any personal claims or defenses that Borrower may have against
Lender.

                v.   Costs and Expenses. Borrower agrees to pay upon demand all
of Lender's expenses incurred in connection with the preparation, execution,
enforcement, modification and collection of this Agreement or in connection with
the Loans made pursuant to this Agreement. Lender may pay someone else to help
collect the Loans and to enforce this Agreement, and Borrower will pay that
amount. This includes, subject to any limits under applicable law, Lender's
legal expenses, whether or not there is a lawsuit, including expenses for
bankruptcy proceedings (including efforts to modify or vacate any automatic stay
or injunction), appeals, and any anticipated post-judgment collection services.
Borrower also will pay any court costs, in addition to all other sums provided
by law.

                vi.  Notices. All notices required to be given under this
Agreement shall be given in writing, may be sent by telefacsimile (unless
otherwise required by law), and shall be effective when actually delivered or
when deposited With a nationally recognized overnight courier or deposited in
the United States mail, first class, postage prepaid, addressed to the party to
whom the notice is to be given at the address shown above. Any party may change
its address for notices under this Agreement by giving formal written notice to
the other parties, specifying that the purpose of the notice is to change the
party's address. To the extend permitted by applicable law, if there is more
than one Borrower, notice to any Borrower will constitute notice to all
Borrowers. For notice purposes, Borrower will keep Lender informed at all times
of Borrower's current address(es).

                vii. Severability. If a court of competent jurisdiction finds
any provision of this Agreement to be invalid or unenforceable as to any person
or circumstance, such finding shall not render that provision invalid or
unenforceable as to any other persons or circumstances. If feasible, any such
offending provision shall be deemed to be modified to be within the limits of
enforceability or validity; however, if the offending provision cannot be so
modified, it shall be stricken and all other provisions of this Agreement in all
other respects shall remain valid and enforceable.

                viii. Subsidiaries and Affiliates of Borrower. To the extend the
context of any provisions of this Agreement makes it appropriate, including
without limitation any representation, warranty or covenant, the word "Borrower"
as used herein shall include all subsidiaries and affiliates of Borrower.
Notwithstanding the forgoing however, under no circumstances shall this
Agreement be construed to require Lender to make any Loan or other financial
accommodation to any subsidiary or affiliate or Borrower.

                ix.  Successors and Assigns. All covenants and agreements
contained by or on behalf of Borrower shall bind its successors and assigns and
shall inure to the benefit of Lender, its successors and assigns. Borrower shall
not, however, have the right to assign its rights under this Agreement or any
interest therein, without the prior written consent of Lender.

                                       13
<PAGE>

                x.   Survival. All warranties, representations, and covenants
made by Borrower in this Agreement or in any certificate or other instrument
delivered by Borrower to Lender under this Agreement shall be considered to have
been relied upon by Lender and will survive the making of the Loan and delivery
to Lender of the Related Documents, regardless of any investigation made by
Lender or on Lender's behalf.

                xi.  Time is of the Essence. Time is of the essence in the
performance of this Agreement.

                xii. Waiver. Lender shall not be deemed to have waived any
rights under this Agreement unless such waiver is given in writing and signed by
Lender. No delay or omission on the part of Lender in exercising any right shall
operate as a waiver of Lender's right otherwise to demand strict compliance with
that provision or any other provision of this Agreement. No prior waiver by
Lender, nor any course of dealing between Lender and Borrower, or between Lender
and any Grantor, shall constitute a waiver of any of Lender's rights or of any
obligations of Borrower or of any Grantor as to any future transactions.
Whenever the consent of Lender is required under this Agreement, the granting
of such consent by Lender in any instance shall not constitute continuing
consent in subsequent instances where such consent is required, and in all cases
such consent maybe granted or withheld in the sole discretion of Lender.

BORROWER ACKNOWELEDGES HAVING READ ALL THE PROVISION OF THIS BUSINESS LOAN
AGREEMENT, AND BORROWER AGREES TO ITS TERMS.

IN WITNESS WHEREOF, Borrower and Lender have executed this Business Loan
Agreement the day and year hereinabove set forth.

Signed, sealed and delivered
in the presence of:

                                 BORROWER:
                                 CAPITOL COMMUNITIES CORPORATION,
                                 a Nevada corporation

/s/ [ILLEGIBLE]                  By: /s/ MICHAEL G. TODD
---------------------            ----------------------------------
                                 Michael G. Todd, President


                                 LENDER:
                                 BOCA FIRST CAPITAL LLLP,
                                 a Florida limited liability limited partnership
                                 By: Addison Capital Group, LLC,
                                     general partner

/s/ [ILLEGIBLE]                      By: /s/ HOWARD BLOOM
---------------------                    --------------------------
                                     Howard Bloom, Manager

                                       14
<PAGE>

                                   EXHIBIT "A"

        This Exhibit "A" constitutes an addendum to that certain Business Loan
Agreement entered into the 25th day of April, 2002 by and between Capitol
Communities Corporation, a Nevada corporation, and Boca First Capital, LLLP, a
Florida limited liability partnership. To the extent of any conflicts between
the terms and provisions of this Exhibit "A" and the terms and provisions of the
said Business Loan Agreement, the terms of this Exhibit "A" shall take
precedence.

That certain revolving line of credit Loan ("Line of Credit Loan") made by
Lender to Borrower in the original principal amount of THREE MILLION THOUSAND
and no/l00ths DOLLARS ($3,000,000.00), which Loan is represented by a Note dated
the 25th day of April, 2002 made by Borrower in favor of Lender in the principal
amount of THREE MILLION THOUSAND and no/100ths DOLLARS ($3,000,000.00), which
Line of Credit Loan is further subject to the following provisions:

1. Security: The Note representing the Line of Credit Loan shall be secured by a
collateral assignment and pledge ("Stock Pledge") of all of the issued and
outstanding capital stock of Borrower's subsidiary, Capitol Development of
Arkansas, Inc., an Arkansas corporation ("CDA"), the form and content of which
Stock Pledge shall be acceptable to Lender. In consideration for the issuance of
the Line of Credit Loan by Lender to Borrower and as a material inducement for
Lender to grant said Line Of Credit Loan to Borrower, Borrower's principal
stockholders, Michael G. Todd and Prescott Investment, L.P., a Nevada limited
partnership, and Borrower's director, Michael G. Todd, by their joinder in this
Agreement, agree that (a) they shall use their shares Borrower, and
Michael G. Todd, his directorship in Borrower to vote against and to prohibit
the imposing of any mortgages, liens or other encumbrances on the real property
and/or other assets of CDA until the Line of Credit Loan is paid in full and
closed; and (b) they shall use their shares Borrower, and Michael G. Todd, his
directorship in Borrower to vote against and to prohibit any further issuance of
stock, common or preferred, by CDA until the Line of Credit Loan is paid in full
and closed. If and at such time as CDA emerges from its current Chapter 11
bankruptcy case, Borrower or Lender may substitute as collateral for the Note,
in lieu of pledged shares of CDA, a mortgage or mortgages and security
agreement upon all of the real property of CDA, subject, however to the written
consent of the Lender, which written consent may be based upon various factors,
including, but not limited to the value of the real property sought to be
substituted, the lien position of the proposed mortgage(s), the creditworthiness
of CDA and of Borrower, provided, however that such consent will not be
unreasonably withheld.

2. Use of Funds; Initial Advances; Limitation on Subsequent Advances:

A. Use of Funds: The funds drawn by Borrower upon the Line of Credit Loan shall
be used by Borrower exclusively for the following purposes; (a) those expenses
described in the 90 day budget projection which is Schedule H attached to that
certain Stock Exchange Agreement of even date herewith entered into by and
between Michael G. Todd, Prescott Investment, L.P., Howard Bloom and
Ken Richardson; (b) payments to promissory note holders of Borrower if, and only
if, Borrower is able to negotiate with such promissory note holders the
retirement of their notes on terms materially the same as those described in
Schedule F of the said Stock Exchange Agreement; (c) interest upon the Line of
Credit Loan, as it falls due; (d) acquisition costs and development costs of
Borrower, provided that the expenditures for such costs and the borrowing from
the Line of Credit Loan for such purposes are approved by the board of directors
of

                                       15
<PAGE>

Borrower; and (e) operating expenses of Borrower, provided that the expenditures
for such costs and the borrowing from the Line of Credit Loan for such purposes
are approved by the board of directors of Borrower. Advances Upon the Line of
Credit Loan, other than those for the purposes described in (a) above shall be
subject to the approval of Lender, based on additional budget projections
submitted in writing by Borrower from time to time.

B. Initial Advance: Contemporaneously with the execution of this Agreement,
Lender shall advance Three-Hundred Thousand and no/l00ths Dollars ($300,000.00)
upon the Line of Credit Loan to Borrower, said sum to be used and applied by
Borrower pursuant to and in accordance with the 90 day budget projection which
is Schedule H attached to that certain Stock Exchange Agreement of even date
herewith entered into by and between Michael G. Todd, Prescott Investment, L.P.,
Howard Bloom and Ken Richardson.

C. Limitation on Subsequent Advances: Borrower agrees to use its best efforts in
order to negotiate with Borrower's promissory note holders the retirement of
their notes on terms materially the same as those described in Schedule F of the
said Stock Exchange Agreement. In the event that Borrower is not successful in
negotiating with Borrower's promissory note holders the retirement of their
notes on terms materially the same as those described in Schedule F of the said
Stock Exchange Agreement, the Lender will not be obligated to extend any
additional advance upon the Line of Credit Loan, and Lender may thereupon
terminate all further advances.

3. Default; Forbearance; Termination of Forbearance:

A. Default; Forbearance. If, immediately prior of at the date of the maturity of
the Note, Borrower anticipates becoming in default upon the Note or will become
in default upon the Note or is in default upon the Note for the reason only that
Borrower cannot pay in full and satisfy the Note, and if Borrower is not then
otherwise in default upon the Note (including any default upon this Agreement or
any other agreement or instrument securing the Note), then, upon Borrower's
written request to Lender, Lender will forbear from any collection activities
upon the Note and Lender will forbear from any collection activities upon the
collateral for the Note for a period of up to eighteen (18) months from the
maturity date of the Note, subject, however, to the following provisions:

1)   From and after the maturity date of the Note and continuing thereafter
     until the Note is paid in full and satisfied, interest upon the Note will
     continue to accrue at the default rate set forth in the Note
     (notwithstanding the forbearance described above).

2)   Interest which accrues upon the Note during the period of any such
     forbearance shall be payable at the time of the payment or payments of the
     outstanding principal amount of the Note, which payment or payments shall
     be applied as set forth in the Note.

3)   During the period of any such forbearance, no further advances shall be
     permitted under the Line of Credit Loan.

4}   Commencing with the maturity date of the Note and continuing thereafter
     during the period of any such forbearance until the Note is paid in full
     and satisfied, Borrower shall take such actions as may be necessary and/or
     desirable in order to pay in full and satisfy the Note, including, but not
     limited to, selling and liquidating

                                       16
<PAGE>

     or arranging for CDA to sell and liquidate the real property and personal
     property assets of CDA, and/or selling and liquidating the real property
     and personal property assets of Borrower.

5)   During the period of any such forbearance, Lender may seek and obtain a
     judgment upon the note (and the forbearance shall not apply to such
     activities).

B. Termination of Forbearance. Notwithstanding the forbearance of Lender agreed
to above if, during the period of any such forbearance, (a) Borrower otherwise
defaults upon the Note (other than the default with respect to which Lender
agreed hereinabove to forbear from enforcement and collection of the Note),
and/or if Borrower defaults upon this Agreement or any other agreement or
instrument securing the Note, (b) or if any third party commences an action
against Borrower or against CDA which action may, in the sole discretion of
Lender, have the ultimate effect of jeopardizing the collateral for the Note or
the assets of CDA, or the prospect of repayment of the Note therefrom, then
Lender may immediately upon written notice to Borrower, terminate its
forbearance and proceed to enforce and collect the Note.

4. Splitting of Line of Credit Loan and Collateral. If and at such time as CDA
emerges from its current Chapter 11 bankruptcy case, Lender may split the Line
of Credit Loan into more than one note and may require that each such note be
secured by a portion of the collateral which would otherwise be the collateral
for the Note, and Lender may assign one or more of such separate notes and its
related collateral to a third party lender or lenders who shall thereupon become
the Lender as to the note or notes so assigned. Borrower agrees to execute such
documents and instruments and to cause CDA to execute such documents and
instruments as may be necessary or desirable in Lender's discretion in order to
finalize such arrangements.

IN WITNESS WHEREOF, Borrower and Lender have executed this Exhibit "A" to
Business Loan Agreement this 26th day of April, 2002.

Signed, sealed and delivered
in the presence of;

                                 BORROWER:
                                 CAPITOL COMMUNITIES CORPORATION,
                                 a Nevada corporation

/s/ [ILLEGIBLE]                  By: /s/ MICHAEL G. TODD
---------------------            ----------------------------------
Ray Baptista                     Michael G. Todd, President


                                 LENDER:
                                 BOCA FIRST CAPITAL LLLP,
                                 a Florida limited liability limited partnership
                                 By: Addison Capital Group, LLC,
                                     general partner

/s/ [ILLEGIBLE]                      By: /s/ HOWARD BLOOM
---------------------                    --------------------------
                                     Howard Bloom, Manager

                                       17
<PAGE>

                                     JOINDER

The undersigned shall and do hereby join into the foregoing business loan
agreement for the purpose only of agreeing to be bound and abide by the
provisions of section 1 of Exhibit "A" thereto.

Dated this 26th day of April, 2002.

                                            /s/ MICHAEL G. TODD
                                            ------------------------------------
                                            MICHAEL G. TODD, as Stockholder and
                                            Director of Capitol Communities
                                            Corporation

                                            PRESCOTT INVESTMENT, L.P.,
                                            a Nevada limited partnership, as
                                            Stockholder of Capitol Communities
                                            Corporation
                                            By: Granite Industries, LLC,
                                                general partner

                                                By: /s/ MICHAEL G. TODD
                                                    ----------------------------
                                                Michael G. Todd, Managing Member

                                       18