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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                   FORM 10-KSB

                                   (Mark One)

                   [ ] ANNUAL REPORT UNDER SECTION 13 OR 15(d)
                     OF THE SECURITIES EXCHANGE ACT OF 1934

                            For the Fiscal Year ended

             [X] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
                         SECURITIES EXCHANGE ACT OF 1934

        For the transition period from June 1, 2003 to December 31, 2003

                         Commission File Number 0-30831

                          CAPITAL GROWTH SYSTEMS, INC.
--------------------------------------------------------------------------------
                 (NAME OF SMALL BUSINESS ISSUER IN ITS CHARTER)

            FLORIDA                                      65-09535505
------------------------------                    ------------------------------
(STATE OTHER JURISDICTION OF                      (I.R.S. EMPLOYER
INCORPORATION OR                                  IDENTIFICATION NUMBER
ORGANIZATION)

              1100 EAST WOODFIELD ROAD, SCHAUMBURG, ILLINOIS 60173
--------------------------------------------------------------------------------
                    (ADDRESS OF PRINCIPAL EXECUTIVE OFFICES)

                                  630-872-5800
--------------------------------------------------------------------------------
                (ISSUER'S TELEPHONE NUMBER, INCLUDING AREA CODE)

Securities registered under Section 12(b) of the Exchange Act:

Title of each class: None

Name of each exchange on which registered: None

Securities registered under Section 12(g) of the Exchange Act:

Title of class: common stock, $.0001 par value

         Check whether the issuer: (1) filed all reports required to be filed by
Section 13 or 15(d) of the Exchange Act during the past 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[ ] No [X]

         Check if there is no disclosure of delinquent filers in response to
Item 405 of Regulation S-K contained in this form, and no disclosure will be
contained, to the best of registrant's

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knowledge, in definitive proxy or information statements incorporated by
reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB.
[X]

         State issuer's revenues for its most recent fiscal year: $0

         The issuer is unable to calculate the aggregate market value of voting
stock held by non-affiliates as of a recent date because the issuer is not aware
of any market for its shares of common stock.

         As of May 3, 2004, the issuer had outstanding 16,000,454 shares of its
$0.0001 par value common stock.

DOCUMENTS INCORPORATED BY REFERENCE

None

         Transitional Small Business Disclosure Format: Yes[ ]  No [X]

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                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                                PAGE
<S>                                                                                                             <C>
ITEM 1.   DESCRIPTION OF BUSINESS............................................................................     5
ITEM 2.   DESCRIPTION OF PROPERTY............................................................................    17
ITEM 3.   LEGAL PROCEEDINGS..................................................................................    17
ITEM 4.   SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS................................................    17
ITEM 5.   MARKET FOR OUR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.......................................    17
ITEM 6.   MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF
          OPERATION..........................................................................................    18
ITEM 7.   FINANCIAL STATEMENTS...............................................................................    19
ITEM 8.   CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE...............    19
ITEM 8A.  CONTROLS AND PROCEDURES............................................................................    14
ITEM 9.   DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE
          EXCHANGE ACT.......................................................................................    20
ITEM 10.  EXECUTIVE COMPENSATION.............................................................................    21
ITEM 11.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.....    24
ITEM 12.  CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.....................................................    26
ITEM 13.  EXHIBITS, FINANCIAL STATEMENTS SCHEDULE AND REPORTS ON FORM 8-K....................................    27
ITEM 14.  PRINCIPAL ACCOUNTANT FEES AND SERVICES.............................................................    28
</TABLE>

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                    CAUTIONARY NOTE REGARDING FORWARD LOOKING
                             STATEMENTS AND CONTEXT

         This report on Form 10-KSB contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of 1995. The
forward-looking statements are contained principally in the sections entitled
"Business" and "Management's Discussion and Analysis or Plan of Operation."
These statements involve known and unknown risks, uncertainties and other
factors which may cause our actual results, performance or achievements to be
materially different from any future results, performances or achievements
expressed or implied by the forward-looking statements.

         In some cases, you can identify forward-looking statements by terms
such as "may," "will," "should," "could," "would," "expects," "plans,"
"anticipates," "believes," "estimates," "projects," "predicts," "potential" and
similar expressions intended to identify forward-looking statements. These
statements reflect our current views with respect to future events and are based
on assumptions and subject to risks and uncertainties. Given these
uncertainties, you should not place undue reliance on these forward-looking
statements. We discuss many of these risks in this report in greater detail
under the heading "Factors Affecting Future Performance." These forward-looking
statements represent our estimates and assumptions only as of the date of this
report, and we do not assume any obligation to update any of these statements.

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                                     PART I

ITEM 1. DESCRIPTION OF BUSINESS.

BACKGROUND

         Capital Growth Systems, Inc. was organized as a Florida corporation on
September 29, 1999. We are a developmental stage company and have had no revenue
through December 31, 2003. Since inception, our activities have been limited to
actions related to our organization and the preparation of the documents
necessary for us to be registered with the Securities and Exchange Commission.
Through December 31, 2003, we operated as a "shell" company conducting virtually
no business operations, other than our efforts to seek a merger partner or
acquisition candidate. Throughout this period we had no full time employees and
owned no real estate. We were created to effect a merger, exchange of capital
stock, asset acquisition or other similar business combination with an operating
or development stage business, which we will refer to as a "target business,"
which desired to utilize our status as a reporting company under the Securities
Exchange Act of 1934.

         On January 28, 2004, we effectuated a business combination by entering
into an Agreement and Plan of Merger whereby we acquired 100% of the ownership
of Nexvu Technologies, LLC, a Delaware limited liability company ("Nexvu"), by
merging it in a forward triangular merger with our wholly owned subsidiary,
Nexvu MergerSub, LLC, a Delaware limited liability company. Nexvu was the
survivor of the merger and we serve as its holding company. Accordingly,
references in this report to "we, us or our" are to Capital Growth Systems, Inc.
or Nexvu. We will refer to Nexvu as a separate entity only where necessary, such
as in the discussion of the business combination below. Nexvu is engaged in the
development and sale of application performance management software to large and
mid-sized companies for use in connection with their computer network systems
and applications.

         The consummation of the business combination was simultaneous with our
closing on the proceeds of a private placement of our common stock, thereby
affording Nexvu ready access to in excess of $5,000,000 of capital, while
avoiding what it might deem to be the adverse consequences of undertaking a
public offering itself, such as the time delays and significant expenses
incurred to comply with the various federal and state securities laws that
regulate initial public offerings.

BUSINESS COMBINATION

         The form of the business combination was a merger in which we issued
8,558,500 shares of our common stock in exchange for 100% of the membership
interests in Nexvu. In addition, pursuant to a Loan Conversion Agreement, we
issued:

         -        an additional number of shares of our common stock needed to
                  convert the amount of new bridge loans funded by Nexvu members
                  from November 15, 2003 through the merger closing into shares
                  of our common stock at a conversion price of approximately
                  $0.95 per share, for a total of 577,500 shares; and

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         -        warrants expiring December 31, 2006 to purchase our common
                  stock at $1.35 per share based upon 50% warrant coverage with
                  respect to all bridge loans funded, for a total of 288,750
                  warrants.

The merger agreement also required a simultaneous closing of the issuance of a
private offering for our common stock of not less than $2,000,000, up to a
maximum of $7,000,000, subject to increase in our sole discretion, at $1.35 per
share, and the conversion of bridge loan principal amounts to equity so that we
would own 100% of Nexvu, which would be substantially debt free as of the merger
closing. We subsequently approved an increase in the maximum amount of the
private offering and raised a total of approximately $7,700,000 from the sale of
our common stock in the private offering. The private offering closed on April
15, 2004.

         The merger agreement further provided that, on closing of the merger,
at least three designees of Nexvu, all of whom were Nexvu's principal officers,
would become members of our board of directors. These persons were elected to
the following positions: Scott Allen, CEO and CFO; Rory Herriman, Chief
Technology Officer; and Robert T. Geras, Chairman of the Board. We also entered
into an indemnification agreement at the closing of the merger in which we
agreed to indemnify and hold harmless all five of our directors against certain
liabilities for actions taken in good faith on our behalf or on behalf of Nexvu.

         The consideration for this transaction was arrived at arms-length
negotiations between Nexvu and us and includes a premium over the net book value
of the assets acquired based upon our own assessment of the market value of
Nexvu's assets and the benefits of combining Nexvu with us.

BACKGROUND OF NEXVU.

         We have developed a suite of software application performance
management tools and products which address a chronic problem facing companies
today: how to measure and ensure that a company's hardware, software and
telecommunications equipment provide the intended functionality and speed. As
businesses continue to increase their delivery of information along their
networks, between their core data centers, their diverse branch locations,
commonly known as the "edge" of the network, and among the multiple computer
residing at the "edge," the usability of the equipment and software programs
running the equipment is often impaired, causing frequent and sometimes severe
interruptions in the way business is transacted.

         We have established a unique, relatively low cost means of
significantly improving the ability to transact business at the "edge." Our
principal product is a small box loaded with our proprietary software, which is
installed in the telephone equipment closet at a customer's location, as well as
its core data centers. The box monitors up to 3,700 different applications over
the customer's network and sends an "alert" message every time the application
is not running within an acceptable level of performance. This enables the
customer to identify that a problem exists and to pinpoint the cause of the
problem, often before the "crash" of the application occurs.

         We launched our first generation of products in July 2003 and have
received significant interest from a number of Fortune 2000 and smaller
companies, which have either purchased

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product and/or installed pilot evaluation units with favorable initial
reactions. Nexvu had raised in excess of $4,000,000 of capital from its founders
and early investors prior to the merger with us.

BUSINESS.

         Size of Market.

         There has been tremendous expansion in the area of application
deployment in the last 20 years. As companies realized the cost benefits and
productivity gains created by network technology, networks expanded almost as
rapidly as technologies and products were introduced. The problems associated
with network expansion affect both day-to-day network operations management and
strategic network growth planning, also known as "capacity planning." Staff
requirements to manage these networks have grown exponentially, resulting in the
need for more automated network management.

         Bear, Stearns and Company Inc., in a March 2002 network infrastructure
management research report, forecasted that the infrastructure management market
would expand from an estimated $8.5 billion in 2001 to more than $21 billion in
2005, a 21% cumulative average growth rate. The majority of this growth is being
driven by the need to reduce operating costs, increase productivity and revenue
and manage risk of location outages by more comprehensively managing the
performance, availability and security intrusion detection of computing
environments at all locations.

         Market Opportunity.

         We have targeted Fortune 2000 companies with highly distributed
operating environments comprised of hundreds to thousands of remote locations
within thousands of application users. Based on information supplied by Fortune,
Hoovers and other industry specific research firms, we estimate this total
market opportunity at approximately two million remote/branch offices in the
U.S.

         We intend to focus on a subset of the Fortune 2000 market within the
retail, call center, insurance, banking and health care industries. These
segments, as detailed below by industry, make up approximately 40% of the
overall market opportunity within the Fortune 2000. We believe that the
attainable sales volume, based upon pilot customer input, will range between 10%
to 15% of the total sites within each segment for the initial product offerings.
Future product offerings are expected to address vertical industry solutions
that will more comprehensively meet the needs of each company, resulting in
additional sales and increased penetration targeted for each segment.

         We believe that these industry segments offer the greatest immediate
opportunity based on direct feedback from customers and suppliers relative to
the challenges they face, with each location critical to the business. It is
imperative to ensure the application performance, availability and usability in
these locations based on their mission-critical business activity, which
includes the following:

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         -        Customer transactions, such as in retail stores and branch
                  banks, where customer revenue and customer satisfaction may be
                  affected.

         -        Transaction processing locations, such as in insurance
                  companies or call centers, where customer satisfaction and
                  productivity may be affected.

         -        Communication transactions, such as for fire and police
                  services, where safety/lives are affected.

         In addition, some of these industries are highly regulated. Regulatory
requirements often drive the need for technology solutions to mitigate business
risk. All of these industries are faced with the challenge of reducing expense,
particularly the high cost of human capital. The value of technology is, in
part, derived from the automation of tasks that are otherwise carried out by
technicians. Since companies in these industries have service level agreements
with their customers, failure to reach minimum service levels, due to
performance issues or outages, may result in monetary penalties.

         We have determined that a two-tiered approach that focuses on high-end
enterprise business in one effort and mid-sized enterprise in another effort
will help allow us to penetrate this market effectively. Early results have
shown that short-term revenue can be driven with much less process, due
diligence and competitive pressure in the mid-size enterprise market than is to
be found in the high-end enterprise account base. We, therefore, intend to carry
forward with this two-tiered approach in our attempt to increase both short-term
revenues and long-term strategic revenue sources.

         Beta Sites/First Customers.

         On June 30, 2003, we introduced the Nexvu Application Performance
Management System 2.0 (the "Nexvu Manager System"), our performance management
solution. This solution has been validated with four Fortune 100 companies who
have tested and verified the need for this technology. All four companies have
been beta testers of the initial release. We believe, but cannot assure, that
each of these four companies will become our customers over the next 12 to 18
months.

         We have worked with each of these companies throughout the design phase
of the product. They have been instrumental in providing input as it relates to
business problems, particularly industry-specific challenges that need to be met
today and in the future. These four companies represent over 20,000 remote sites
throughout the U.S.

         First Customer.

         It is important to note that our current pipeline extends beyond the
four Fortune 100 customers previously mentioned. In August of 2003, we received
our first purchase order for the Nexvu Manager System from our first paying
customer, Bally's Total Fitness. This initial order of five Nexvu appliances and
one Nexvu command center appliance is the first of a larger rollout that we hope
to deploy across Bally's entire infrastructure of over 400 fitness centers. We
have not signed any agreements to install any of our equipment in these Bally's
locations.

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         Go-To-Market Strategy.

         Sales Approach. We are focused on building a three-tiered
distribution/channel partner approach to selling products. At the present time,
we do not intend to pursue a direct sales approach and focus on attaining the
preponderance of our revenue through a channel approach. The three tiers of this
strategy are our sales to distributors, and sales by distributors to resellers
and resellers to end-users.

         We must approve any party wishing to resell products or solutions
developed or marketed by us.

         Product Description.

         The Nexvu Manager System has two major components:

         Nexvu Manager Appliance. This appliance is considered the nerve center
of the Nexvu Application Performance management System. Residing at the customer
remote location, the Nexvu manager appliance collects management data by
capturing and classifying information in a passive, non-disruptive manner as it
flows across the network. Once collected, the Nexvu manager appliance assesses
the information looking for performance trends, or in the case of an outage,
deducing the root cause of the outage and providing network operators with
actionable information. Engineered for highly distributed environments, the
Nexvu manager appliance is easy to deploy and operate. As a self-contained, two
rack-unit device weighing less than 17 pounds, it can be installed by
non-technical personnel. Additionally, the Nexvu manager appliance contains a
series of restoration-based tools that provide network operators and field
personnel the ability to restore an outage without dispatching technical
resources to the site. It is important to note that we design, build and market
the software portion of the Nexvu manager appliance. Our distributors can then
integrate our certified hardware with this software to sell the final appliance
to our approved resellers or end-users of the product.

         Nexvu Command Center Appliance. In addition to being the primary user
interface, the Nexvu command center appliance is responsible for managing all
Nexvu manager appliances throughout the customer's environment. This includes
initialization, configuration, upgrading and monitoring. The customer typically
will have one Nexvu command center appliance for approximately every 500 Nexvu
manager appliances. Like the Nexvu manager appliance, the Nexvu command center
appliance is engineered for turn-key deployment. As a self-contained two
rack-unit appliance, the Nexvu command center appliance can be easily installed
in the data center or network operations center without advanced technical
support. As with the Nexvu Manager Appliance, we design, build and market the
software portion of the Nexvu Command Center Appliance. Our distributors can
then integrate our approved hardware with this software to sell the final
appliance to our approved resellers or end-users of the product.

         Future Products. Leveraging on the foundation of the Nexvu Manager
System, we plan to introduce a set of complementary products that provide
customers with deeper insight into their operating environment.

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         Product Differentiation.

         The Nexvu Manager System is designed to apply the critical functions of
application performance management at the increasingly important remote/branch
locations of a company. Key differentiators include:

-        Comprehensive application level data collection;

-        Real-time performance analysis at the site level, ensuring minimal
         impact to wide area network bandwidth;

-        Out-of-the-box support for 800+ protocols (such as SAP and Oracle) and
         3200+ applications including voice/video over IP, IPSEC and Cisco ISL;

-        Performance notification to management to ensure minimal impact on
         business operations;

-        Advanced security framework built on a 128bit 3DES encryption mechanism
         ensures the product cannot be breached;

-        Turn-key solutions, which are easy to deploy and operate, to be readily
         installed at remote locations by non-technical personnel, yet centrally
         managed;

-        Cost-effective solutions designed for deployment at thousands of remote
         locations where the risk and cost of downtime is increasingly high;

-        New technology solutions integrating performance and fault management
         leveraging the data capture and trend analysis across each system;

-        Robust architecture that supports the integration of third party tools
         to leverage existing technology investment;

-        Built-in recovery tools accessible both in-band and out-of-band through
         dial-up; and

-        System architecture designed for international deployment through the
         use of language catalogs.

         Competitive Analysis.

         When evaluating our solution from a competitive nature, the driving
goal of the organization must be considered. We believe that goal is creating
real value for the customer by offering products and solutions that identify and
resolve business application "usability" problems.

         We have also realized that there is a shift in the way organizations
view, use, and purchase IT performance management tools that will have a
long-term impact on the overall competitive environment for these markets.
Listed below are a number of these technologies and feature sets:

FAULT IDENTIFICATION                    FAULT ISOLATION       NETWORK MANAGEMENT
--------------------                    -----------------     ------------------
PACKET CAPTURE                          SNMP TRAP CAPABLE     RMON 1/RMON 2
PROTOCOL DECODES AND                    SUPPORT FOR FAULT     ART MIB SUPPORT

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        ANALYSIS
ROOT CAUSE ANALYSIS
        FOR NETWORK                     MANAGEMENT SYSTEMS
        PROTOCOL ISSUES

         We believe there is an industry trend that will continue to place
pressure on organizations that rely on these technologies for revenue streams,
with increasing demand for products in a new, emerging market - that of
application performance management and monitoring.

         The Competitive Landscape Defined. The International Standards
Organization (ISO) outlines the primary functions of network management systems
as being focused on the five conceptual areas, also known as "FCAPS":

         1.       Fault Management. Fault management encompasses the activities
of detection, isolation and correction of abnormal systems operation. Fault
management provides the means to receive and present fault indication, determine
the cause of a fault, isolate the fault and perform a corrective action if
required.

         2.       Configuration Management. Configuration management activities
include the configuration, maintenance and updating of system components.
Configuration management also includes notification to network users of pending
and performed configuration changes.

         3.       Accounting Management. The ability to track usage to detect
inefficient use and abuse of privileges or usage patterns is included in
accounting management - a key component for capacity planning.

         4        Performance Management. Performance management tools are used
to recognize current or impending performance issues that can cause problems for
users. Activities include the monitoring and maintenance of acceptable
performance and the collection and analysis of statistics critical to
performance.

         5        Security Management. Security management encompasses the
activities of controlling and monitoring access to the network and associated
network management information. This includes controlling passwords and user
authorization and collecting and analyzing security or access logs. The goal of
a network management system is to provide this functionality in a concise manner
that views the entire network as one homogeneous entity.

         There are several organizations and companies who have combined many of
these FCAPS functions into products and solutions that have traditionally
produced profitable revenues. Many of the following companies have combined key
elements of network performance management, fault management and/or accounting
management:

         -      NETWORK ASSOCIATES               -     APOGEE NETWORKS
         -      NETSCOUT                         -     COMPUWARE
         -      CONCORD COMMUNICATIONS           -     MICROMUSE
                                                 -     TAVVE NETWORKS
         -      AGILENT                          -     NIKSUN
         -      ACTERNA                          -     CANDLE COMMUNICATIONS

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         -      WILDPACKETS                      -     LUCENT
         -      NETWORK INSTRUMENT

         Application Performance Management Solutions. A new component to the
performance management space outlined above is that of application performance
management. This market is focused on delivering solutions that attempt to
resolve issues regarding the performance of business applications and systems.
Many of the application performance management products are developed, marketed
and sold by the following organizations:

         -        MERCURY INTERACTIVE            -        NETIQ
         -        CISCO                          -        CONCORD COMMUNICATIONS
         -        NETQOS                         -        COMPUWARE

         There are several network management platforms such as HP Openview, CA
Unicenter and IBM Tivoli that can be viewed as the main console for network
operations. While our products have some competitive functionality with these
network management platforms, they also integrate and extend the functionality
of those platforms.

         The solutions currently available from us are comprised of many key
attributes of all three markets described above: network management; fault
isolation; and fault identification and application performance management.

         Our Competition. The market for our products and services is highly
competitive. As set forth above, we have identified a number of publicly-held
companies in the application performance management market with which we
compete. Although we believe that our product and service offering provides
significant functional advantages, there is no assurance that we will be able to
effectively compete in this market. Prospective competitors vary in size and in
the scope and breadth of the products and services offered. Many of our
potential competitors have a number of significant advantages, including a
longer operating history, preferred vendor status with our potential customers,
more extensive name recognition and marketing power and significantly greater
financial, technical, marketing and other resources which would give them the
ability to respond more quickly to new or changing opportunities, technologies
and customer requirements. We may not be able to maintain or expand our revenue
base if competition increases and we are unable to respond effectively.

OPERATING MODEL

         We plan to outsource key, non-strategic elements of our operations to
enable rapid time to market, maximize return on investment and minimize risks
from exposure to non-core competencies. We plan to focus on developing strong
products, sell them into the marketplace and partner with strategic
organizations that can help accelerate the adoption of our solutions. Our
current manufacturing relationships are able to meet our current capacity
requirements and support future needs.

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         Manufacturing.

         Our software is designed for installation in standard compute products.
We have presently identified two separate manufacturers willing to provide
hardware on which our software can be loaded.

         Installation.

         We have positioned our products to be customer installable, ensuring
minimal disruption to the customer's business. Installations can be done by
non-technical personnel with minimal assistance. However, we expect to establish
partnerships with industry leading professional services firms to accommodate
any unique customer requirements.

PATENTS AND PROPRIETARY TECHNOLOGY

         We have proprietary technology and confidential software code. As of
the date of this Form 10-KSB, we have yet to file any patent applications.

EMPLOYEES

         As of December 31, 2003, we had no full time employees. As of the date
of this report, we have 28 employees who are employed in the following areas:
product development, quality assurance, product marketing and management, sales
and sales support and customer support. None of our employees are covered by a
collective bargaining agreement. We believe all relations with our employees are
satisfactory.

FACTORS AFFECTING FUTURE PERFORMANCE

         The following are important factors which relate to our business:

         Competition.

         We believe that the principal bases of competition in the application
performance management, or APM market, are a product's performance, its price
and quality, the vendor's name recognition and reputation, and product
availability. The rapidly evolving nature of the markets in which we compete may
attract new entrants as they perceive opportunities, and our competitors may
foresee the course of market developments more accurately than us. In addition,
our competitors may develop products that are superior and less expensive than
our products or may adapt more quickly than us to new technologies or evolving
customer requirements. We expect competition to increase significantly in the
future. There can be no assurance that we will be able to compete successfully
with our existing competitors or with new competitors in the APM market. Failure
to compete successfully could adversely affect our business, results of
operations and financial condition. See "Competition."

         Risks of Product Obsolescence, Failure to Develop New Products and Size
of Business.

         We expect that the market for our products will be characterized by
rapidly changing technology and new product introductions. Our success will
depend, in part, upon our continued

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ability to provide products with the advanced technological qualities desired by
our customers, to enhance and expand our existing product offerings and to
develop in a timely manner new products that achieve market acceptance. Any
failure or delay in accomplishing these goals could have a material adverse
effect on our business, results of operations and financial condition. In
addition, current competitors or new market entrants may develop new products
with features that could adversely affect the competitive position of our
products.

         We believe the APM market is undergoing rapid change and that our
current product offering provides functionality and pricing superior to many of
our competitors. However, competition in this area is very intense, and it is
expected that existing and new competitors will seek to replicate much of the
functionality of our products. Although we are exploring the possibility of
patenting certain of our technology, there can be no assurances that patent
protection can be attained or that if attained, it is enforceable or that there
are not other ways to engineer around our proprietary technology. Additionally,
there can be no assurances that we will be able to successfully develop the next
generation of products necessary to establish market leadership or that if we
are able to do so, that customer acceptance for such products could continue.

         Given the intense nature of the software business, once a product is
developed, competition has the ability to lower its pricing significantly to
gain market share, due to the minimal incremental cost to product production.
Additionally, certain aspects of the market may be lost to the extent over time
"free" software is developed to address such functionality.

         In the high technology business, one of the largest barriers to entry
for small and start-up companies is the concern by enterprise customers as to
the survivability of the company. Even if we are profitable, we may experience
significant resistance from certain prospective customers due to our relatively
small balance sheet. This could be exacerbated to the extent we fail to attain
break-even profitability quickly.

         Uncertainties Regarding Patents and Protection of Proprietary
Technology.

         We rely on a combination of confidentiality agreements, trade secrets,
technical expertise and continuing technological research and development to
establish and protect proprietary rights in our products. There can be no
assurance that competitors will not develop similar or functionally equivalent
technology or expertise.

         There can be no assurance that third parties will not allege
infringement by us of patents and proprietary rights of such parties in the
future. If infringement is alleged, there is no assurance that we would prevail
in any such challenge, or that if such challenge is successful, that we will be
able to obtain a license to use such technology on acceptable terms. Similarly,
competitors may seek to either design around or willfully infringe our
technology. We may lack the resources to enforce any patents or other
intellectual property rights we may have or a court may subsequently determine
that the scope of our intellectual property protection is not as broad as
presently envisioned. In any event, proprietary rights litigation can be
extremely protracted and expensive and we may lack the resources to enforce our
intellectual property.

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         Risk of System Disruption.

         Our proposed Internet-based information and other systems could be
vulnerable to, among other factors, disruptions caused by system failures, power
losses, communication problems or natural disasters. In addition, our services
may be vulnerable to break-ins and similar disruptive problems. Further,
weaknesses in communications media, such as the Internet, may compromise the
security of confidential electronic information exchanged with members.
Disruptions of service or security breaches could cause losses to us, reduce
customer satisfaction in our services or otherwise have a material adverse
effect on our business, results of operations or financial condition.

         Dependence on Continued Growth in Use of the Internet.

         Rapid growth in use of and interest in the Internet is a recent
phenomenon and there can be no assurance that acceptance and use of the Internet
will continue to develop or that a sufficient base of users will emerge to
support our business. Our future revenues may, in part, depend on the widespread
acceptance and use of the Internet as a source of multimedia information and
entertainment and as a vehicle for commerce in goods and services.

         The Internet could lose its viability as a commercial medium due to
delays in the development or adoption of new standards and protocols required to
handle increased levels of Internet activity, or due to increased government
regulation. Changes in or insufficient availability of telecommunications
services to support the Internet also could result in unacceptable response
times and could adversely affect use of the Internet. If use of the Internet
does not continue to grow or grows more slowly than expected, or if the Internet
infrastructure does not effectively support the growth that may occur, our
business, results of operations and financial condition could be materially
adversely affected.

         Significant Fluctuations in Quarterly Operating Results.

         We may experience significant fluctuations in future quarterly
operating results from a number of factors, including:

         -        the timing and nature of expansion efforts in both new and
                  existing markets;

         -        the introduction of new products or services and the market
                  response to those introductions;

         -        the timing and nature of sales transactions for interactive
                  marketing and other products and services;

         -        relationships with retailers;

         -        seasonal trends;

         -        changes in pricing policies or service offerings;

                                       15

<PAGE>

         -        changes in the level of marketing and other operating expenses
                  to support future growth;

         -        competitive factors; and

         -        general economic conditions

         Consequently, quarterly revenue and operating results may fluctuate
significantly, and we believe that period-to-period comparisons of results will
not necessarily be meaningful and should not be relied upon as an indication of
future performance. Furthermore, due to the foregoing factors, among others, it
is likely that our future quarterly operating results from time to time may not
meet the expectations of research analysts or investors.

         Management of Growth.

         Our recent growth has placed, and is expected to continue to place, a
significant strain on our managerial, operational, technical and financial
resources. We expect operating expenses and staffing levels to increase
substantially in the future as we expand. We have added sales and marketing
personnel over the past six months, who have made significant progress with
customers, but who are very costly to employ, due to salary, travel expenses and
the need to grant them options. To manage our growth, we must expand our
operational and technical capabilities, increase, train and manage our employee
base and manage multiple relationships with various retailers and other third
parties. There can be no assurance that we will be able to manage our expanding
operations effectively. Any failure to implement effective management and
operating systems, add resources on a cost-effective basis or effectively manage
our expansion could have a material adverse effect on our business, results of
operations or financial condition.

         Need for Additional Capital.

         We may need to procure additional financing over time, the amount and
timing of which will depend on a number of factors including the pace of
expansion of our markets and customer base, services offered and development
efforts and the cash flow generated by our operations. We cannot predict the
extent to which we will require additional financing. There can be no assurance
regarding the availability or terms of additional financing we may be able to
procure over time. Any future debt financing or issuance of preferred equity by
us could be senior to the rights of shareholders, and any future issuance of
equity could result in the dilution of the then existing owners' proportionate
equity interests in us.

         Dependence on Nexvu Management.

         Our success depends to a significant degree upon the continuing
contributions of our key management: Scott Allen, our CEO and CFO, Rory
Herriman, our CTO, and Robert T. Geras, our Chairman. The loss of any of them
could have a material adverse effect upon us and our operations.

                                       16

<PAGE>

         Indemnification of Officers and Directors.

         We intend to indemnify our officers and directors to the fullest extent
permissible under the law. Under most circumstances, our officers and directors
may not be held liable to us or our equity owners for errors in judgment or
other acts or omissions in the conduct of our business unless such errors in
judgment, acts or omissions constitute fraud, gross negligence or malfeasance.

ITEM 2. DESCRIPTION OF PROPERTY.

         Through December 31, 2003, our principal office was located at 980
North Michigan Avenue, Suite 1120, Chicago, Illinois 60611. We occupied this
space rent free at the principal office of one of our directors, Lee Wiskowski.

         As a result of the merger, our principal office has been relocated to
1100 East Woodfield Road, Suite 100, Schaumburg, Illinois 60173. In June 2003,
we entered a three-year lease with a two year option for our principal office at
a rate of $76,300 per annum. In addition, we also lease a small office at 2009
Fox Drive Suite 2, Champaign, Illinois 61820, which houses some of our product
development staff. This lease was entered into in January 2002, having an
original one-year term, with annual options to renew. The current rent for this
facility is $38,800 per year.

ITEM 3. LEGAL PROCEEDINGS.

         None.

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

         None.

                                     PART II

ITEM 5. MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS.

MARKET INFORMATION

         No public trading market presently exists for our common stock. We
intend to file a registration statement to register the shares of our common
stock issued by us in connection with the business combination, exclusive of
those shares issued to the former owners of Nexvu and upon the conversion of
bridge loans. We expect that once such registration statement is declared
effective, a trading market will develop for our common stock. However, there
can be no assurances that a trading market will develop.

HOLDERS

         As of May 3, 2004, there were approximately 202 holders of record of
our common stock.

                                       17

<PAGE>

DIVIDENDS

         We have not paid any cash dividends since our inception, and our board
of directors does not contemplate doing so in the near future. Any decisions as
to future payment of dividends will depend on our earnings and financial
position and such other factors, as our board of directors deems relevant.

RECENT SALE OF UNREGISTERED SECURITIES

         On October 1, 2003, we entered into a Subscription Agreement with
Grander, LLC, d/b/a Capital Strategies Group, an Illinois limited liability
company under which Grander agreed to purchase 238,500 shares of our common
stock in consideration for Grander's funding of certain of our operational
requirements. The offering price of the shares purchased was $13,000, for a
purchase price of $0.054 per share of our common stock. Mr. Lee Wiskowski, a
director of ours, is the sole member of Grander. In connection with the issuance
to Grander we relied upon the exemption from registration available under
Section 4(2) of the Securities Act of 1933, as amended.

         On January 28, 2004, we issued a total of 8,558,500 shares of our
common stock in connection with a merger between Nexvu Merger Technologies,
L.L.C. into our wholly-owned subsidiary, Nexvu Mergersub, L.L.C. These issuances
were made in reliance upon the exemption from registration available under
Section 4(2) of the Securities Act.

         In addition, under a loan conversion agreement, we issued: 577,500
shares of common stock, the amount necessary for the conversion of bridge loans
funded by Nexvu members and outstanding prior to the merger, into shares of our
common stock at $0.9523809 per share, or approximately $550,000 in total; and
warrants expiring December 31, 2006 to purchase common stock at $1.35 per share
based upon 50% warrant coverage with respect to all bridge loans funded, for a
total of 288,750 warrants. We further sold 26,250 shares to an accredited
individual at the same price at which the bridge loans were converted. This
individual did not receive warrants to purchase common stock. These issuances
were made in reliance upon the exemption from registration available under
Section 4(2) of the Securities Act.

         Between December 2003 and April 2004, we raised a total of $7,652,075
in the private offering of 5,668,204 shares of our common stock. This offering
was made in reliance upon the exemption from registration available under
Section 4(2) of the Securities Act and on Rule 506 of Regulation D.

ITEM 6. MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION.

         Through December 31, 2003, we were a development stage company
conducting virtually no business operations, other than our efforts to effect a
business combination with a target business which we considered to have
significant growth potential. As of December 31, 2003, we had neither engaged in
any operations nor generated any revenue or cash flow. As a result of the
merger, we intend to carry out our plan of business as discussed above in Item 1
of this Form 10-KSB.

         We incurred expenses of professional fees of $8,870 during this
transition period ended December 31, 2003 and $21,361 during the fiscal year
ended May 31, 2003. As of December 31, 2003, we were not in a position to meet
our cash requirements for the next fiscal year as we

                                       18

<PAGE>

did not generate any cash revenue or receive any type of cash flow through
December 31, 2003. Presently, we cannot predict to what extent our liquidity and
capital resources will be diminished as a result of our merger with Nexvu on
January 28, 2003.

ITEM 7. FINANCIAL STATEMENTS.

         Our financial statements are included after the signature pages of this
report.

ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE.

         On November 27, 2001 the owners of 925,000 shares of our common stock,
which represented a 99.9% ownership interest, sold their shares to SMP Financial
Consultants, Inc. pursuant to an Agreement of Purchase and Sale of Shares for
total cash consideration of $64,600. In connection with this transaction, our
then board of directors, which was composed solely of Mr. James Caprio,
determined to no longer engage Salberg & Company, P.A., as our independent
public accountants and engaged Russell & Atkins, PLC to serve as our independent
public accountants for 2002 and 2003. However, we did not formally notify
Salberg & Company of the change in accountants at that time. We made this
notification on April 26, 2004.

         Salberg & Company's report on our financial statements as of May 31,
2001 and for each of the two years then ended and from September 29, 1999
(inception) to May 31, 2001 did not contain an adverse opinion or disclaimer of
opinion, nor was it qualified or modified as to uncertainty, audit scope or
accounting principles, except that the report contained an explanatory paragraph
expressing substantial doubt about our ability to continue as a going concern.
Salberg & Company's report on our financial statements for 2001 containing this
going concern opinion was dated September 11, 2001 and was issued in conjunction
with the publication of our Annual Report to Shareholders and the filing of our
Annual Report on Form 10-KSB for the year ended May 31, 2001. Salberg & Company
did not perform an audit of our financial statements for any periods subsequent
to the year ended May 31, 2001.

         During 2001 and through April 26, 2004, there were no disagreements
with Salberg & Company on any matter of accounting principles or practices,
financial statement disclosure, or auditing scope or procedure which, if not
resolved to Salberg & Company's satisfaction, would have caused it to make
reference to the subject matter in connection with its report on our financial
statements for such year, and there were no reportable events, as listed in Item
304(a)(1)(v) of Regulation S-K.

         We provided Salberg & Company, P.A. with a copy of the foregoing
disclosures and Salberg & Company, P.A. has agreed that these disclosures, as
they pertain to Salberg & Company, P.A., are accurate.

         During our two most recent fiscal years and through March 31, 2004, we
did not consult Russell & Atkins with respect to the application of accounting
principles to a specified transaction, either completed or proposed, or the type
of audit opinion that might be rendered on our financial statements, or any
other matters or reportable events listed in Items 304(a)(2)(i) and (ii) of
Regulation S-K.

                                       19

<PAGE>

ITEM 8A. CONTROLS AND PROCEDURES.

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURE

         Our CEO/CFO has evaluated our disclosure controls and procedures as of
the end of the fiscal year ended December 31, 2003, and has concluded that, as
of December 31, 2003, these controls and procedures have been effectively
designed to ensure that information required to be disclosed in reports that we
file with or submit to the Commission is recorded, processed, summarized and
reported within the time periods specified in the Commission's rules and forms
and is accumulated and communicated to management as appropriate to allow timely
decisions regarding this disclosure.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

         No changes in our internal control over financial reporting have come
to management's attention during our last fiscal quarter that have materially
affected, or are reasonably likely to materially affect, our internal control
over financial reporting. Review and evaluation of disclosure controls and
procedures is an ongoing process that we will continue to refine as we perform
quarterly evaluations.

                                    PART III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS;
         COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT.

         As of December 31, 2003, we had only two officers and directors. As a
result of our merger with Nexvu on January 28, 2004, we have additional
directors and executive officers. We are listing both our officers and directors
as of December 31, 2003 and our current officers and directors in the
subsections that follow.

OFFICERS AND DIRECTORS AS OF DECEMBER 31, 2003

<TABLE>
<S>                      <C>    <C>
NAME                     AGE    POSITION

LEE WISKOWSKI            37     DIRECTOR, PRESIDENT, CHIEF EXECUTIVE OFFICER
                                AND CHIEF FINANCIAL OFFICER

DOUGLAS STUKEL           34     DIRECTOR, SECRETARY AND TREASURER
</TABLE>

CURRENT OFFICERS AND DIRECTORS

         The composition and biographies of our directors and officers as a
result of the completion of our merger with Nexvu on January 28, 2004 is as
follows:

                                       20

<PAGE>

<TABLE>
<S>                       <C>    <C>
NAME                      AGE    POSITION

ROBERT T. GERAS           66     CHAIRMAN OF THE BOARD OF DIRECTORS, ASSISTANT SECRETARY AND
                                 ASSISTANT TREASURER

SCOTT ALLEN               41     DIRECTOR, CHIEF EXECUTIVE OFFICER AND CHIEF FINANCIAL
                                 OFFICER

RORY HERRIMAN             33     DIRECTOR, SECRETARY, TREASURER AND CHIEF TECHNOLOGY OFFICER

DOUGLAS STUKEL            34     DIRECTOR AND ASSISTANT SECRETARY

LEE WISKOWSKI             37     DIRECTOR
</TABLE>

         Robert T. Geras

         Mr. Geras has served as our Chairman of the Board since the completion
of our merger with Nexvu. Mr. Geras also served as the Chairman of Nexvu from
June 2003 through the date of the merger. Mr. Geras is also an early investor
and second largest shareholder of publicly traded Merge Technologies Inc. (MRGE
- Nasdaq National Market), an industry leader in eHealth connectivity products
for medical imaging and other clinical information. Mr. Geras has also served as
a director and/or early stage investor in VideoHomeTours, a provider of visual
content management and marketing services for large brokerage firms;
ShowingTime.com, a complete Internet scheduling and productivity tool for real
estate agents; Exadigm, Inc., a company engaged in the development and sale of
electronic payment processing equipment utilizing wi-fi technology; and 20/20
Technologies, LLC, a provider of bandwidth and connectivity to the high speed
data transmission industry.

         Scott Allen

         Mr. Allen has served as a director and our Chief Executive and Chief
Financial Officer since the completion of our merger with Nexvu. In addition,
Mr. Allen served as the Chief Executive Officer and President of Nexvu from July
2003 through the date of the merger. Prior to joining Nexvu, Mr. Allen spent
seven years working at Network Associates, Inc. During his tenure at Network
Associates, Mr. Allen held key contributor roles in the sales organization.
Between October 2001 and June 2003, Mr. Allen served as the Vice President,
Product Management for the Sniffer Technologies division of Network Associates.
Mr. Allen also spent nine years between 1987 and 1996 in the health care
industry developing architecture and installing and managing enterprise networks
for Intermountain Health Care.

         Rory Herriman

         Mr. Herriman has served as a director and our Chief Technology Officer
since the completion of our merger with Nexvu. Mr. Herriman also served as the
Chief Technology Officer of Nexvu from May 2002 through the date of the merger.
From 1997 until 2002, Mr. Herriman served as the Senior Director of Technology
Architecture and Engineering at Sears, Roebuck and Company where he defined and
executed enterprise wide technology direction in the areas of
telecommunications, networking and computing. From 1996 until 1997, Mr.

                                       21

<PAGE>

Herriman served as a Senior Product Engineer for MCI Telecommunications, where
he worked with Fortune 500 companies to define and implement global
communication infrastructures.

         Douglas Stukel

         Mr. Stukel has served as one of our directors since August 2003. Mr.
Stukel, together with Mr. Wiskowski, led the investor group which purchased the
current majority stake in CGS. In addition, Mr. Stukel is a co-founder of
Premier Holdings of Illinois, LLC, a distributor of medical supplies based in
Joliet, Illinois. From 1997 to 2001, Mr. Stukel served as the president of
Cendant Home Funding from 1997 until 2001, a residential mortgage company based
in Joliet, Illinois. Mr. Stukel is also a co-founder of Momentum Capital, LLC, a
privately held consulting and advisory firm.

         Lee Wiskowski

         Mr. Wiskowski has served as a director since the completion of our
merger with Nexvu. Prior to the merger with Nexvu, Mr. Wiskowski served as our
Chief Executive Officer, Chief Financial Officer, President and director since
August 2003. He, together with Doug Stukel, was responsible for the
identification of our merger with Nexvu. Mr. Wiskowski was the co-founder of
Madison Securities and an early co-founder of Advanced Equities, both NASD
licensed broker-dealers registered in all 50 states. Mr. Wiskowski sold his
interest to the other principals of Advanced Equities approximately three years
ago, and has been engaged in the investment and advisory business since that
time through Grander, LLC and Momentum Capital, LLC, both privately held
advisory and consulting firms.

         All directors hold office until their successors have been elected and
qualified or until their earlier resignation or removal. Directors are elected
annually. Officers serve at the discretion of our board of directors.

CODE OF ETHICS

         On January 29, 2004, our board of directors adopted a Code of Ethics
which applies to our principal executive officer, principal financial officer,
principal accounting officer and controller and persons performing similar
functions. We will provide a copy of the Code of Ethics, without charge, to any
person who sends a written request addressed to Capital Growth Systems, Inc.,
1100 East Woodfield Road, Suite 100, Schaumburg, Illinois 60173. A copy of the
Code of Ethics has been filed as an exhibit to this report.

         We intend to disclose any waivers or amendments to our Code of Ethics
in a report on Form 8-K with the Securities and Exchange Commission rather than
on our website.

AUDIT COMMITTEE

         We have an Audit Committee and an Audit Committee Charter, a copy of
which is attached to this report. The Audit Committee is presently comprised of
Robert Geras, Lee Wiskowski and Doug Stukel. The Audit Committee is responsible
for selection and oversights of our independent auditors, reviewing with the
independent auditors the scope and results of the audit engagement, establishing
and monitoring our financial policies and control procedures,

                                       22

<PAGE>

reviewing and monitoring the provision of non-audit services by our independent
auditors and reviewing all potential conflict of interest situations. We
presently do not have a director who would qualify as an "audit committee
financial expert" as defined in Item 401(e) of Regulation S-B. Given our present
situation, we feel it would be overly costly, burdensome and unwarranted to
retain an independent director who would qualify as an "audit committee
financial expert." We will consider adding an audit committee financial expert
if our business grows and adding such a person would be less burdensome.

COMPLIANCE WITH SECTION 16(a) OF THE SECURITIES EXCHANGE ACT OF 1934

         Our executive officers, directors and shareholders beneficially owning
more than 10% of our common stock are required under the Exchange Act to file
reports of ownership of our common stock with the Securities and Exchange
Commission. Copies of those reports must also be furnished to us. Based solely
upon a review of the copies of reports furnished to us and written
representations that no other reports were required, we believe that during the
preceding year all filing requirements applicable to executive officers,
directors and shareholders beneficially owning more than 10% of our common stock
have been complied with.

ITEM 10. EXECUTIVE COMPENSATION.

         Through December 31, 2003, neither of our directors or officers had
received any salary or other compensation of any kind, other than reimbursement
for out-of-pocket expenses incurred on our behalf, and we did not have any
employment agreements with them.

         As a result of the merger with Nexvu, we will compensate our directors
and officers for their services to us. The agreements we have entered into to
date with our executive officers are described below.

         We have entered into employment agreements with each of Scott Allen and
Rory Herriman under which each is entitled to a base salary of $175,000 per
year. Under these agreements, each of Mr. Allen and Mr. Herriman may receive
bonuses in the discretion of the Board of Directors, with a target bonus of 50%
of base salary. Mr. Allen and Mr. Herriman are each entitled to receive under
their respective employment agreements, options to acquire 430,000 shares of our
common stock under our Long-Term Incentive Plan, vesting over a ten-year period
through January 2, 2007, with acceleration on a change in control. In addition,
each of Mr. Allen and Mr. Herriman is entitled to a bonus in the event of a
successful change in control, such as a merger or sale of our Company, equal to
the lesser of 299% of their base salary as of the date of the change in control,
or one percent of the amount by which the value of the transaction to our
shareholders exceeds the product of the highest prior price at which we sold our
shares, multiplied by the number of our outstanding shares of ours as of the
date the change of control occurs.

         Each employment agreement has a term ending at the end of the calendar
year and will automatically renew for additional one-year periods unless
terminated by us or the executive on written notice at least two months before
expiration of the current term. Under the agreements, if employment is
terminated without cause, or the agreement does not automatically renew, he is
entitled to receive severance of one year's pay, payable in regular monthly
increments. The

                                       23

<PAGE>

agreements also provide for a lump sum payment of 90 days' pay in the event of
death or disability.

         In December 2003, our board of directors adopted the 2003 Long-Term
Incentive Plan for key employees and other persons providing assets or services
of value. The plan provides for the issuance of stock based awards to key
employees as part of their overall compensation. A total of 2,285,000 restricted
shares of our common stock, stock options or other equity based compensation can
be issued under the plan. It is expected that a substantial portion of these
options will be allocated to existing management and other persons assisting us
in our endeavors. Presently, we have issued 1,691,500 restricted shares under
the plan.

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
         MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

BENEFICIAL OWNERSHIP

         The following table sets forth, as of May 3, 2004, the names,
addresses, amount and nature of beneficial ownership and percent of such
ownership of:

         each person known to us to be the beneficial owner of more than five
                percent (5%) of our common stock;

         each director; and

         all directors and executive officers, as a result of our business
                combination with Nexvu.

Except as otherwise indicated in the footnotes to the table, the persons named
below have sole voting and investment power with respect to the shares
beneficially owned by them. In general, a person is deemed to be a "beneficial
owner" of a security if that person has or shares the power to vote or direct
the voting of such security, or the power to dispose of or to direct the
disposition of such security. A person is also deemed to be a beneficial owner
of any securities for which the person has the right to acquire the beneficial
ownership within 60 days. The beneficial ownership percentages are based on
16,000,454 shares outstanding as of May 3, 2004.

<TABLE>
<CAPTION>
NAME AND ADDRESS OF BENEFICIAL           AMOUNT AND NATURE OF
          OWNER                         BENEFICIAL OWNERSHIP(1)    PERCENT OF CLASS
---------------------------------       ----------------------     ----------------
<S>                                     <C>                        <C>
Robert T. Geras                               2,257,837(2)               14.01%
Carl C. Greer Trust                           2,266,282(3)               13.92%
Craig Siegler                                 1,459,278(4)                9.03%
David Lies                                    1,304,375(5)                8.09%
Balkin Family Limited Partnership             1,093,186(6)                6.79%
Rory Herriman(7)                                618,871(8)                3.77%
Scott Allen(7)                                  591,678(9)                3.60%
Douglas Stukel(10)                             434,482(11)                2.67%
Lee Wiskowski(10)                              325,407(12)                2.00%
All Directors and Executive
Officers as a Group (5 persons)                 4,233,275               24.23%
</TABLE>

                                       24

<PAGE>

(1)      Except pursuant to applicable marital property laws or as indicated in
         the footnotes to this table, to our knowledge, each shareholder
         identified in the table possesses sole voting and investment power with
         respect to all common stock shown as beneficially owned by the
         shareholder.

(2)      Includes warrants to purchase 111,111 shares held by Mr. Geras. Mr.
         Geras' business address is 55 East Erie Street, Suite 2905, Chicago,
         Illinois 60611.

(3)      Includes warrants held by the Carl C. Greer Trust to acquire 277,778
         shares. The business address of the trust is c/o Thomas Floyd, 4501
         West 127th Street, Suite D, Alsip, Illinois 60803.

(4)      Includes warrants held by Mr. Siegler to acquire 162,500 shares. Mr.
         Siegler's business address is 388 Melford Road, Deerfield, Illinois
         60035.

(5)      Includes warrants to purchase 111,111 held by Mr. Lies, 97,392 shares
         owned by Mr. Lies' wife, and warrants to purchase 9,259 shares held by
         Mr. Lies' wife. Mr. Lies disclaims beneficial ownership of shares held
         by his wife or issuable upon the exercise of warrants held by his wife.
         The address of Mr. Lies is 1210 Sheridan Road, Wilmette, Illinois
         60091.

(6)      Includes warrants held by the Balkin Family Limited Partnership to
         acquire 92,593 shares. The address of the partnership is 1145 Green Bay
         Road, Glencoe, Illinois 60022.

(7)      The business address of Mr. Herriman and Mr. Allen is Nexvu
         Technologies, LLC, 1100 East Woodfield Road-Suite 100, Schaumburg,
         Illinois 60173.

(8)      Includes options to purchase 430,000 shares held by Mr. Herriman.

(9)      Includes options to purchase 430,000 shares held by Mr. Allen.

(10)     The business address of Mr. Wiskowski and Mr. Stukel is 980 N. Michigan
         Avenue, Suite 1120, Chicago, Illinois 60611.

(11)     Includes 250,000 shares issuable upon the exercise of a warrant held by
         Mr. Stukel.

(12)     Includes 72,407 shares owned by Grander, LLC, of which Mr. Wiskowski is
         the sole member, and 250,000 shares issuable upon the exercise of a
         warrant held by Mr. Wiskowski.

                                       25

<PAGE>
EQUITY COMPENSATION PLAN INFORMATION

<TABLE>
<CAPTION>
                                                                         NUMBER OF SECURITIES
                                                                          REMAINING AVAILABLE
                                NUMBER OF SECURITIES                      FOR FUTURE ISSUANCE
                                 TO BE ISSUED UPON    WEIGHTED AVERAGE        UNDER EQUITY
                                    EXERCISE OF       EXERCISE PRICE OF    COMPENSATION PLANS
                                    OUTSTANDING          OUTSTANDING     (EXCLUDING SECURITIES
                                  OPTIONS, WARRANTS   OPTIONS, WARRANTS     REFLECTED IN
        PLAN CATEGORY               AND RIGHTS          AND RIGHTS           COLUMN (a))
-----------------------------   --------------------  -----------------  ---------------------
<S>                             <C>                   <C>                <C>
Equity Compensation Plans               --                    --                    --
Approved by Security Holders
Equity Compensation Plans Not            0                    --              2,285,000*
Approved by Security Holders
         Total                           0                    --              2,285,000
</TABLE>

*        Consists of securities issuable under our 2003 Long-Term Incentive Plan
for key employees, which was approved by our board of directors on December 16,
2003.

ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.


         On December 1, 2003, we entered into a Business and Financial Advisory
Agreement with Grander, LLC, of which Lee Wiskowski is the sole member. For its
services, Grander has been paid a fee of $765,000 for advising us in connection
with the structuring of our acquisition of Nexvu, establishment of commercial
and strategic partnerships and joint ventures, development of our marketing
plans, financial models, financial strategies and structuring of our private
offering.


         On March 31, 2004, we entered into an Advisory Services Agreement with
Lee Wiskowski. Pursuant to the Agreement, Mr. Wiskowski will provide financial
advisory services in connection with mergers and acquisitions and provide
analysis as to strategic alternatives. As consideration for such services, Mr.
Wiskowski was granted a three-year warrant, exercisable at $1.35 per share, to
purchase 250,000 shares of our common stock on or before March 31, 2007.

         On March 31, 2004, we entered into an Advisory Services Agreement with
Doug Stukel. Pursuant to the Agreement, Mr. Stukel will provide financial
advisory services in connection with mergers and acquisitions and provide
analysis as to strategic alternatives. As consideration for such services, Mr.
Stukel was granted a three-year warrant, exercisable at $1.35 per share, to
purchase 250,000 shares of our common stock on or before March 31, 2007.

                                       26

<PAGE>

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K.

(a)      Exhibits


<TABLE>
<CAPTION>
EXHIBIT NUMBER                                  DESCRIPTION OF DOCUMENT
--------------    ----------------------------------------------------------------------------------
<S>               <C>
      2.1         Agreement and Plan of Merger Agreement By and Among Capital Growth Systems, Inc.,
                  Nexvu MergerSub, LLC, and Nexvu Technologies, L.L.C. dated January 28, 2004. (1)

      3.1         Articles of Incorporation of Capital Growth Systems, Inc. (2)

      3.2         By-laws of Capital Growth Systems, Inc. (3)

      4.1         Registration Rights Agreement by and among Capital Growth Systems, Inc. and certain
                  shareholders of the Company dated as of December 16, 2003.(1)

      4.2         Form of Warrant to Purchase common stock of Capital Growth Systems, Inc. for bridge
                  lenders.

      4.3         Form of Warrant to Purchase common stock of Capital Growth Systems, Inc. for Advisory
                  Service Agreements.

      4.4         Form of Warrant to Purchase common stock of Capital Growth Systems, Inc. for selling
                  shareholder.

      4.5         2003 Long-Term Incentive Plan.

      10.1        Indemnification Agreement by and among Capital Growth Systems, Inc., Nexvu
                  Technologies, L.L.C., Rory Herriman, Douglas Stukel and Lee Wiskowski dated as of
                  January 28, 2004.(1)

      10.2        Loan Conversion Agreement by and among Nexvu Technologies, L.L.C., Robert T. Geras,
                  Balkin Family L.P., Carl Greer Trust, David J. Lies, Linda M. Lies and Karen Jaimovich
                  dated as of December 31, 2003. (1)

      10.3        Second Amended and Restated Operating Agreement of Nexvu Technologies, LLC.

      10.4        Advisory Services Agreement dated March 31, 2004 by and between Capital Growth
                  Systems, Inc. and Lee Wiskowski.

      10.5        Advisory Services Agreement dated March 31, 2004 by and between Capital Growth
                  Systems, Inc. and Douglas Stukel.
</TABLE>


                                       27

<PAGE>


<TABLE>
<S>               <C>
      10.6        Employment Agreement dated April 26, 2004 by and between Capital Growth Systems, Inc.
                  and Scott Allen.

      10.7        Employment Agreement dated April 26, 2004 by and between Capital Growth Systems, Inc.
                  and Rory Herriman.

      14          Code of Ethics.

      16.1        Letter from Salberg & Co., P.A. regarding Change in Auditors. (4)

      21.1        List of Subsidiaries.

      31.1        Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

      31.2        Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

      32          Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906
                  of the Sarbanes-Oxley Act of 2002.
</TABLE>


-----------------------
(1)      Incorporated herein by reference to the Form 8-K filed with the
         Commission on February 11, 2004 (File No. 0-30831).

(2)      Incorporated herein by reference to Exhibit 3.1 to Form 10-SB
         filed with the Commission on June 20, 2000 (File No. 0-30831).

(3)      Incorporated herein by reference to Exhibit 3.2 to Form 10-SB
         filed with the Commission on June 20, 2000 (File No. 0-30831).

(4)      Incorporated herein by reference to the Form 8-K filed with
         the Commission on May 3, 2004 (File No. 0-30831).

(b)      Reports of Form 8-K

         None.

ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

         (a)      Audit Fees.

         The aggregate fees billed by Russell & Atkins, PLC for the transition
period ending December 31, 2003 and for the fiscal years ended May 31, 2003 and
May 31, 2002 for professional services rendered for the audit of our financial
statements and the reviews of the financial statements included in our Form
10-Qs totaled $6,250, $5,750 and $4,500, respectively.

         (b)      Audit-Related Fees.

         None.

                                       28

<PAGE>

         (c)      Tax Fees

         None.

         (d)      All Other Fees

         None.

         (e)      Audit Committee Pre-Approval Policy

         As of December 31, 2003, we had not established a separately-designed
standing audit committee. As a result of the completion of our business
combination with Nexvu on January 28, 2004, we presently have a
separately-designed standing Audit Committee and an Audit Committee Charter. Our
Audit Committee intends to pre-approve all non-audit services provided by our
independent auditors.

                                       29

<PAGE>

                                   SIGNATURES

         In accordance with Section 13 or 15(d) of the Exchange Act, the
registrant caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.

                                      CAPITAL GROWTH SYSTEMS, INC.

                                      BY: /s/ Scott Allen
                                          ----------------------------------
                                          Scott Allen, Chief Executive
                                          Officer and Chief Financial Officer

Dated: May 6, 2004

         In accordance with the Exchange Act, this report has been signed below
by the following persons on behalf of the registrant and in the capacities and
on the dates indicated:

SIGNATURE                TITLE                                      DATE

/S/ SCOTT ALLEN          DIRECTOR, CHIEF EXECUTIVE OFFICER, AND     May 6, 2004
---------------          CHIEF FINANCIAL OFFICER
SCOTT ALLEN

/S/ ROBERT T. GERAS      CHAIRMAN OF THE BOARD OF DIRECTORS         May 6, 2004
-------------------
ROBERT T. GERAS

/S/ RORY HERRIMAN        DIRECTOR AND CHIEF TECHNOLOGY OFFICER      May 6, 2004
-----------------
RORY HERRIMAN

/S/ DOUGLAS STUKEL       DIRECTOR                                   May 6, 2004
------------------
DOUGLAS STUKEL

/S/ LEE WISKOWSKI        DIRECTOR                                   May 6, 2004
-----------------
LEE WISKOWSKI

                                       30

<PAGE>

INDEX TO FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
               CAPITAL GROWTH SYSTEMS, INC. CONSOLIDATED FINANCIAL STATEMENTS                PAGE
------------------------------------------------------------------------------------------   ----
<S>                                                                                          <C>
Report of Independent Certified Public Accountants                                            F-2

Balance Sheet as of December 31, 2003 and May 31, 2003                                        F-3

Statement of Operations for the transition period of June 1 through December 31, 2003, and,   F-4
the years ended May 31, 2003 and 2002 and from September 29, 1999 (Inception) to December
31, 2003

Statement of Changes in Stockholders' Equity from September 29, 1999 (Inception) to December  F-5
31, 2003

Statement of Cash Flows for the transition period of June 1 through December 31, 2003, and,   F-6
the years ended May 31, 2003 and 2002 and from September 29, 1999 (Inception) to December
31, 2003

Notes to Consolidated Financial Statements                                                    F-7
</TABLE>

<TABLE>
<CAPTION>
                NEXVU TECHNOLOGIES, LLC CONSOLIDATED FINANCIAL STATEMENTS                    PAGE
------------------------------------------------------------------------------------------   ----
<S>                                                                                          <C>
Report of Independent Certified Public Accountants                                            F-13

Balance Sheet as of December 31, 2003 and December 31, 2002                                   F-14

Statement of Operations and Members' Equity for the year ended December 31, 2003, and the     F-16
period ended December 31, 2002 and from February 28, 2002 (Inception) to December 31, 2003

Statement of Cash Flows for the year ended December 31, 2003, and the period ended December   F-17
31, 2002 and from February 28, 2002 (Inception) to December 31, 2003

Notes to Consolidated Financial Statements                                                    F-19
</TABLE>

<PAGE>

                          CAPITAL GROWTH SYSTEMS, INC.
                          (A DEVELOPMENT STAGE COMPANY)

                              FINANCIAL STATEMENTS

                                DECEMBER 31, 2003

                                      F-1

<PAGE>

Independent Auditors Report

To the Board of Directors of:
Capital Growth Systems, Inc.

         We have audited the accompanying balance sheets of Capital Growth
Systems, Inc. (A Development Stage Company) as of December 31, 2003 and May 31,
2003, the related statements of operations and cash flows for the period then
ended December 31, 2003, the years ended May 31, 2003 and May 31, 2002, and from
inception (September 29, 1999) to December 31, 2003, and the changes in
stockholders' equity from inception (September 29, 1999) to December 31, 2003.
These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion of these consolidated financial
statements based on our audits.

         We conduct our audits in accordance with auditing standards generally
accepted in the United States of America. These standards require that we plan
and perform the audits to obtain reasonable assurance about whether the
consolidated financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts and
disclosures in the consolidated 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 presentation.
We believe that our audits provide a reasonable basis for our opinion.

         In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial position of Capital Growth
Systems, Inc. (A Development Stage Company) as of December 31, 2003 and May 31,
2003 and the results of its operations and cash flows for the period then ended
December 31, 2003, the years ended May 31, 2003 and May 31, 2002, and from
inception (September 29, 1999) to December 31, 2003 in conformity with
accounting principles generally accepted in the United States of America.


/s/ Russell & Atkins, PLC
-----------------------------
Russell & Atkins, PLC

Oklahoma City, Oklahoma
April 28, 2004

                                       F-2

<PAGE>

CAPITAL GROWTH SYSTEMS, INC.
(A Development Stage Company)
BALANCE SHEET

<TABLE>
<CAPTION>
                                                  DECEMBER 31,   MAY 31,
                                                      2003        2003
                                                  -----------   --------
<S>                                               <C>           <C>
ASSETS

Current Assets
Cash                                                $      -      $    -
                                                    --------    --------

Total Current Assets                                       -           -
                                                    --------    --------
Other Assets
Incorporation costs                                        -           -
                                                    --------    --------
Total Other Assets                                         -           -
                                                    --------    --------
TOTAL ASSETS                                        $      -     $     -
                                                    ========    ========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current Liabilities
Accounts payable                                    $ 13,059    $ 11,361
Advance from shareholder                              10,231      10,000
                                                    --------    --------
TOTAL CURRENT LIABILITIES                             23,290      21,361
                                                    --------    --------
Stockholders' Equity
Common stock, authorized 25,000,000 shares,
 par value $ .0001, issued and outstanding
  - 1,170,000(May 31, 2003 - 931,500)                    117          93

Additional paid in capital                            19,678       6,702
Deficit accumulated during the development stage     (43,085)    (28,156)
                                                    --------    --------

Total Stockholders' Equity                           (23,290)    (21,361)
                                                    --------    --------

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY          $      -     $     -
                                                    ========    ========
</TABLE>

The accompanying notes are an integral part of these financial Statements.

                                       F-3

<PAGE>

CAPITAL GROWTH SYSTEMS, INC.
(A Development Stage Company)
STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>
                                                                         From
                               PERIOD        YEAR        YEAR          Inception
                               ENDED        ENDED       ENDED       (Sept 29, 1999)
                            DECEMBER 31,     MAY          MAY       To DECEMBER 31,
                                2003       31, 2003    31, 2002         2003
<S>                         <C>           <C>          <C>          <C>
INCOME                       $       -    $       -    $       -       $       -
                             ---------    ---------    ---------       ---------

OPERATING EXPENSES
Professional Fees               14,929       21,361        2,504          41,860
Amortization Expenses                -            -            -               -
Administrative Expenses              -            1           60           1,225
                             ---------    ---------    ---------       ---------

Total Operating Expenses        14,929       21,362        2,564          43,085
                             ---------    ---------    ---------       ---------

Net Loss from Operations     $ (14,929)   $ (21,362)   $  (2,564)      $ (43,085)
                             =========    =========    =========       =========

Weighted average number of
  shares outstanding         1,032,918      931,500      931,500         945,466
                             =========    =========    =========       =========

Net Loss Per Share           $    (.01)   $    (.02)   $   (.003)      $    (.05)
                             =========    =========    =========       =========
</TABLE>

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

                                       F-4

<PAGE>

CAPITAL GROWTH SYSTEMS, INC.
(A Development Stage Company)
STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY From
September 29, 1999 (Inception) to December 31, 2003

<TABLE>
<CAPTION>
                                                                          Deficit
                                                                        Accumulated
                                         Common Stock       Additional    During
                                    --------------------     Paid In    Development
                                      Shares     Amount      Capital       Stage       Total
                                    ---------   --------   -----------  -----------   --------
<S>                                 <C>         <C>        <C>          <C>           <C>
Issuance of common stock              931,500   $     93     $  4,722     $     --    $  4,815

Net loss for period                        --         --           --       (1,659)     (1,659)
                                    ---------   --------     --------     --------    --------

Balance, May 31, 2000                 931,500         93        4,722       (1,659)      3,156

Net loss for year                          --         --           --       (2,571)     (2,571)
                                    ---------   --------     --------     --------    --------

Balance, May 31, 2001                 931,500   $     93     $  4,722     $ (4,230)   $    585

Additional capital contributed             --         --        1,980           --       1,980

Net loss for year                          --         --           --       (2,564)     (2,564)
                                    ---------   --------     --------     --------    --------

Balance, May 31, 2002                 931,500   $     93     $  6,702     $ (6,794)   $      1

Net loss for year                          --         --           --      (21,362)    (21,362)
                                    ---------   --------     --------     --------    --------
Balance, May 31, 2003                 931,500         93        6,702      (28,156)    (21,361)

Issuance of common stock              238,500         24       12,976           --      13,000


Net loss - Dec 31, 2003                    --         --           --      (14,929)    (14,929)
                                    ---------   --------     --------     --------    --------

Balance - December 31, 2003         1,170,000   $    117     $ 19,678     $(43,085)   $(23,290)
                                    =========   ========     ========     ========    ========
</TABLE>

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

                                       F-5

<PAGE>

CAPITAL GROWTH SYSTEMS, INC.
(A Development Stage Company)
STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                        From
                                   Period      YEAR        YEAR       Inception
                                   Ended       ENDED      ENDED     (Sept 29, 1999)
                                December 31,  MAY 31,     MAY 31,   To December 31,
                                    2003       2003        2002        2003
                                --------------------------------------------------
<S>                             <C>          <C>         <C>        <C>
Cash Flows From Operating
  Activities
Net loss                         $(14,929)   $(21,362)   $ (2,564)     $(43,085)
Adjustments to reconcile net
 loss to net cash used
   operating activities:
 Stock issued for services              -           -           -             -
Changes in assets and
    liabilities
 Increase(decrease) in
    Accounts payable                1,698      11,361        (490)       13,059
                                 --------    --------    --------      --------
                                    1,698      11,361        (490)       13,059
                                 --------    --------    --------      --------
Net Cash Used in Operating
   Activities                     (13,231)    (10,001)     (3,054)      (30,026)
                                 --------    --------    --------      --------
Cash Flow From Financing
   Activities
Issuance of common stock           13,000           -           -        17,815
Increase in Advance from
   Shareholder                        231      10,000           -        10,231
Contributed capital                     -           -       1,980         1,980
                                 --------    --------    --------      --------
Net Cash Provided By Financing
    Activities                     13,231      10,000       1,980        30,026
                                 --------    --------    --------      --------
Increase(decrease) in Cash              -          (1)     (1,074)            -
Cash and Cash Equivalents -
 Beginning of period                    -           1       1,075             -
                                 --------    --------    --------      --------
Cash and Cash Equivalents -
 End of period                    $     -    $      -    $      1      $      -
                                 ========    ========    ========      ========
Supplemental Cash Flow
   Information
 Interest paid                   $      -    $      -    $      -      $      -
                                 ========    ========    ========      ========
 Taxes paid                      $      -    $      -    $      -      $      -
                                 ========    ========    ========      ========
</TABLE>

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

                                       F-6

<PAGE>

CAPITAL GROWTH SYSTEMS, INC.
(A DEVELOPMENT STAGE COMPANY)
NOTES TO FINANCIAL STATEMENTS
AS AT DECEMBER 31, 2003

1.       ORGANIZATION AND BASIS OF PRESENTATION

         CAPITAL GROWTH SYSTEMS, INC. (the "Company") was organized in the State
of Florida on September 29, 1999. The Company's intends to serve as a vehicle to
effect an asset acquisition, merger, exchange of capital stock or other business
combination with a domestic or foreign business of an undetermined nature at
this time.

         Development Stage Enterprise

         The Company has no revenues and has just commenced operations. The
Company's activities are accounted for as those of a "Development Stage
Enterprise" as set forth in Financial Accounting Standards Board Statement No. 7
("SFAS 7"). Among the disclosures required by SFAS 7 are that the Company's
financial statements be identified as those of a development stage company, and
that the statements of operations, stockholders' equity(deficit) and cash flows
disclose activity since the date of the Company's inception.

2.       SIGNIFICANT ACCOUNTING POLICIES

         Basis of Accounting

         These financial statements are presented on the accrual method of
accounting in accordance with generally accepted accounting principles.
Significant accounting principles followed by the Company and the methods of
applying those principles, which materially affect the determination of
financial position and cash flows, are summarized below.

         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 the
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 may differ from those estimates.

         Cash and Cash Equivalents

         The Company considers all highly liquid debt instruments and
investments, purchased with an original maturity date of three months or less,
to be cash equivalents.

         Income Taxes

         The Company accounts for income taxes under SFAS No. 109, which
requires the asset and liability approach to accounting for income taxes. Under
this method, deferred assets and liabilities are measured based on differences
between financial reporting and tax bases of assets

                                       F-7

<PAGE>

and liabilities measured using enacted tax rates and laws that are expected to
be in effect when differences are expected to reverse.

         Net earnings(loss) per share

         Basic and diluted net loss per share information is presented under the
requirements of SFAS No. 128, Earnings per Share. Basic net loss per share is
computed by dividing net loss by the weighted average number of shares of common
stock outstanding for the period, less shares subject to repurchase. Diluted net
loss per share reflects the potential dilution of securities by adding other
common stock equivalents, including stock options, shares subject to repurchase,
warrants and convertible preferred stock, in the weighted-average number of
common shares outstanding for a period, if dilutive. All potentially dilutive
securities have been excluded from this computation, as their effect is
anti-dilutive.

         Fair Value of Financial Instruments

         The carrying amount of cash is considered to be representative of its
fair value because of the short-term nature of this financial instrument.

         Recently Issued Accounting Standards

         On July 20, 2001, the Financial Accounting Standards Board ("FASB")
issued Statement of Financial Accounting Standards ("SFAS") No. 141, "Business
Combinations," and SFAS No. 142, "Goodwill and Intangible Assets." SFAS No. 141
is effective for all business combinations completed after June 30, 2001. SFAS
No. 142 is effective for fiscal years beginning after December 15, 2001;
however, certain provisions of this Statement apply to goodwill and other
intangible assets acquired between July 1, 2001, and the effective date of SFAS
No. 142. The implementation of SFAS No. 141 and SFAS No. 142 will not have a
material effect on the financial position or results of operations of the
Company.

         In August 2001, the FASB issued SFAS No. 144, "Accounting for the
Impairment of Disposal of Long-Lived Assets." SFAS No. 144 is effective for
fiscal years beginning after December 15, 2001, and addresses financial
accounting and reporting for the impairment or disposal of long-lived assets.
This statement supersedes SFAS No. 121, "Accounting for the Impairment of
Long-Lived Assets and for Long-Lived Assets to Be Disposed Of," and the
accounting and reporting provisions of Accounting Principles Board Opinion No.
30, "Reporting the Results of Operations - Reporting the Effects of Disposal of
a Segment of a Business, and Extraordinary, Unusual and Infrequently Occurring
Events and Transactions," for the disposal of a segment of a business.

         The Financial Accounting Standards Board has recently issued SFAS No.
133 as amended by SFAS 137 and 138, "Accounting for Derivative Instruments and
Hedging Activities" established accounting and reporting standards for
derivative instruments and related contracts and hedging activities. This
statement is effective for all fiscal quarters and fiscal years beginning after
June 15, 2000. The adoption of this pronouncement did not have a material effect
on the Company's position or results of operations.

                                       F-8

<PAGE>

         In June 2002, the FASB issued SFAS No. 146, "Accounting for Costs
Associated with Exit or Disposal Activities", which addresses accounting for
restructuring and similar costs. SFAS NO. 146 supersedes previous accounting
guidance, principally Emerging Issues Task Force Issue No. 94-3. SFAS No 146
requires that the liability for costs associated with an exit or disposal
activity be recognized when the liability is incurred, SFAS No. 146 also
establishes that the liability should initially be measured and recorded at fair
value. Accordingly, SFAS No. 146 may affect the timing of recognizing future
restructuring costs as well as the amount recognized. SFAS NO. 146 is effective
for exit or disposal activities that are initiated after December 31, 2002.

         In November 2002, the FASB Interpretation No. 45 (FIN 45) "Guarantor's
Accounting and Disclosure Requirements for Guarantees, Including Indirect
Guarantees of Indebtedness of Others." FIN 45 requires that a liability be
recorded in the guarantor's balance sheet upon issuance of certain guarantees.
FIN 45 also requires disclosure about certain guarantees that an entity has
issued. The Company has implemented the disclosure requirements required by FIN
45, which were effective for fiscal years ending after December 15, 2002. The
Company will apply the recognition provisions of FIN 45 prospectively to
guarantees issued after December 31, 2002.

         In December 2002, the FASB issued SFAS No. 148 "Accounting for
Stock-Based Compensation-Transition and Disclosure - an amendment of FASB
Statement No. 123" (FAS 148). The statement amends SFAS 123 "Accounting for
Stock Based Compensation:" (FAS 123) to provide alternative methods of
voluntarily transition to the fair value based method of accounting for stock
based employee compensation. FAS 148 also amends the disclosure requirement of
FAS 123 to require disclosure of the method used to account for stock based
employee compensation and the effect of the method on reported results in both
annual and interim financial statements. The Company has no current intention to
change its policy of accounting for stock-based compensation.

         In January 2003, the FASB issued FASB Interpretation No. 46 (FIN 46),
"Consolidation of Variable Interest Entities, and Interpretation of ARB No.51."
FIN 46 requires certain variable interest entities to be consolidated by the
primary beneficial of the entity if the equity investors in the entity do not
have characteristics of a controlling financial interest or do not have
sufficient equity at risk for the entity to finance its activities without
additional subordinated financial support from other parties. FIN 46 is
effective for all new variable interest entities created or acquired after
January 31, 2003. For variable interest entities created or acquired prior to
February 1, 2003, the provisions of FIN 46 must be applied for the first interim
or annual period beginning on or after June 15, 2003.

         On April 30, 2003 the FASB issued Statement No. 149, "Amendment of
Statement 133 on Derivative Instruments and Hedging Activities." The Statement
amends and clarifies accounting for derivative instruments, including certain
derivative instruments embedded in other contracts, and for hedging activities
under Statement 133. The amendments set forth in Statement 149 improve financial
reporting by requiring that contracts with comparable characteristics be
accounted for similarly. In particular, this Statement clarifies under what
circumstances a contract with an initial net investment meets the characteristic
of a derivative as discussed in Statement 133. In addition, it clarifies when a
derivative contains a financing

                                       F-9

<PAGE>

component that warrants special reporting in the statement of cash flows. This
Statement is effective for contracts entered into or modified after June 30,
2003.

         On May 15, 2003 the FASB issued Statement No. 150, "Accounting for
Certain Financial Instruments with Characteristics of both Liabilities and
Equity". The Statement improves the accounting for certain financial instruments
that, under previous guidance, issuers could account for as equity. The new
Statement requires that those instruments be classified as liabilities in
statements of financial position. In addition to its requirements for the
classification and measurement of financial instruments in its scope, Statement
150 also requires disclosures about alternative ways of settling the instruments
and the capital structure of entities, all of whose shares are mandatorily
redeemable. Most of the guidance in Statement 150 is effective for all financial
instruments entered into or modified after May 31, 2003.

         The Company believes that none of the recently issued accounting
standards will have a material impact on the financial statements.

3.       GOING CONCERN

         The accompanying financial statements have been prepared assuming that
the Company will continue as a going concern. This basis of accounting
contemplates the recovery of the Company's assets and the satisfaction of its
liabilities in the normal course of business. Through December 31, 2003, the
Company had incurred cumulative losses of $43,085. The Company's successful
transition from a development stage company to attaining profitable operations
is dependent upon obtaining financing adequate to achieving a level of
revenues adequate to support the Company's cost structure. Subsequent to the
date of these financial statements the Company completed a merger with Nexvu
Technologies, LLC and raised in excess of $7,500,000 pursuant to a common stock
private placement. The resulting cash balances are expected to be more than
sufficient to cover the cost of operations for the Company for 2004. See Note
5. Subsequent Events.

4.       INCOME TAXES

         There has been no provision for U.S. federal, state, or foreign income
taxes for any period because the Company has incurred losses in all periods and
for all jurisdictions. 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 deferred tax assets are as follows:

         Deferred tax assets

<TABLE>
<S>                                                    <C>
         Net operating loss carry forwards             $ 43,085
         Valuation allowance for deferred tax assets    (43,085)
                                                       --------
Net deferred tax assets                                $      0
                                                       ========
</TABLE>

         Realization of deferred tax assets is dependent upon future earnings,
if any, the timing and amount of which are uncertain. Accordingly, the net
deferred tax assets have been fully offset by a valuation allowance. As of
December 31, 2003 the Company had net operating loss carry forwards of
approximately $43,085 for federal and state income tax purposes. These carry
forwards, if not utilized to offset taxable income begin to expire in 2016.
Utilization of the net operating loss may be subject to substantial annual
limitation due to the ownership change

                                      F-10

<PAGE>

limitations provided by the Internal Revenue Code and similar state provisions.
The annual limitation could result in the expiration of the net operating loss
before utilization.

5.       ISSUANCE OF COMMON STOCK

         On October 1, 2003, the Company entered into a Subscription Agreement
with Grander, LLC, whereby Grander agreed to purchase 238,500 shares of common
stock in consideration for Grander's funding of certain of the Company's
operational requirements. The offering price of the shares purchased was $0.0545
per share. Total proceeds of this issuance were $13,000.


6.       SUBSEQUENT EVENTS

         On January 28, 2004, the Company merged with Nexvu Technologies, LLC
("Nexvu") an operating business. The merger was contingent upon the Company
having raised a minimum of $2,000,000 of investor capital pursuant to a common
stock private placement of $1.35 per share. As of April 15, 2004 an aggregate
of $7,625,075 of gross proceeds from the private placement had been raised. In
addition, at the merger closing, $550,000 of bridge loans to Nexvu were
converted into additional shares of the Company's common stock at approximately
$0.95 per share and one additional $25,000 subscription was accepted shortly
thereafter at such pricing. In connection with the merger, an aggregate of
8,558,500 shares of the Company's common stock were issued to the members of
Nexvu and Nexvu became a wholly owned subsidiary of Capital Growth Systems,
Inc. The Company's cash balances as of March 1, 2004 are expected to be more
than sufficient to cover the cost of operations for 2004.


                                      F-11

<PAGE>

                             NEXVU TECHNOLOGIES, LLC
                        (A DEVELOPMENT STAGE ENTERPRISE)

                              FINANCIAL STATEMENTS

                                DECEMBER 31, 2003

                                      F-12

<PAGE>

INDEPENDENT AUDITORS' REPORT

To the Board of Members of
Nexvu Technologies, LLC

         We have audited the accompanying balance sheets of Nexvu Technologies,
LLC (a Development Stage Enterprise) as of December 31, 2002 and 2003 and the
related statements of operations and stockholders' equity, and cash flows for
the years then ended. 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 audit in accordance with auditing standards generally
accepted in the United States of America. 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 presentation. We believe that our audit provides a
reasonable basis for our opinion.

         In our opinion, the financial statements referred to above present
fairly, in all material respects, the financial positions of Nexvu Technologies,
LLC (a Development Stage Enterprise) as of December 31, 2002 and 2003 and the
results of its operations, and its cash flows for the years then ended in
conformity with accounting principles generally accepted in the United States of
America.

/s/ Russell & Atkins, PLC
--------------------------------
Russell & Atkins, PLC

May 3, 2004
Oklahoma City, Oklahoma

                                      F-13

<PAGE>

NEXVU TECHNOLOGIES, LLC
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
DECEMBER 31, 2002 AND 2003

<TABLE>
<CAPTION>
                                                          2003        2002
-----------------------------------------------------------------------------
<S>                                                    <C>         <C>
ASSETS

CURRENT ASSETS

Cash                                                   $  616,880  $        -
Accounts receivable                                        61,270       9,590
Prepaid expenses                                           51,837           -
-----------------------------------------------------------------------------

Total Current Assets                                      729,987       9,590
-----------------------------------------------------------------------------

FIXED ASSETS - net of accumulated depreciation            136,341     179,777
-----------------------------------------------------------------------------

OTHER ASSETS
Software licensing fee                                    300,000     300,000
Organization costs - net of accumulated amortization            -       3,371
-----------------------------------------------------------------------------

Total Other Assets                                        300,000     303,371
-----------------------------------------------------------------------------
TOTAL ASSETS                                           $1,166,328  $  492,738
-----------------------------------------------------------------------------
</TABLE>

                                      F-14

<PAGE>

NEXVU TECHNOLOGIES, LLC
(A DEVELOPMENT STAGE ENTERPRISE)
BALANCE SHEET
DECEMBER 31, 2002 AND 2003

<TABLE>
<CAPTION>
                                            2003          2002
-----------------------------------------------------------------
<S>                                     <C>           <C>
LIABILITIES AND MEMBERS' EQUITY

CURRENT LIABILITIES

Accounts payable                        $   160,971   $   219,519
-----------------------------------------------------------------

Total Current Liabilities                   160,971       219,519

LONG-TERM
Loans payable                               735,000     1,400,136
-----------------------------------------------------------------

Total Liabilities                           895,971     1,619,655

MEMBERS' EQUITY(DEFICIT)                    270,357    (1,126,917)
-----------------------------------------------------------------
Total Liabilities and Members' Equity     1,166,328       492,738
-----------------------------------------------------------------
</TABLE>

                                      F-15

<PAGE>

NEXVU TECHNOLOGIES, LLC
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF OPERATIONS AND MEMBERS' EQUITY (DEFICIT)

<TABLE>
<CAPTION>
                                                                       FROM
                                                                    INCEPTION,
                                                                     FEBRUARY
                                           YEAR         PERIOD       28, 2002
                                          ENDED          ENDED         TO
                                         DECEMBER      DECEMBER     DECEMBER
                                         31, 2003      31, 2002     31, 2003
------------------------------------------------------------------------------
<S>                                      <C>           <C>          <C>

REVENUE                                     59,027             -        59,027
------------------------------------------------------------------------------

OPERATING EXPENSES
Consulting fees                            134,883        47,452       182,335
Depreciation and amortization               84,395        39,075       123,470
Employee benefits                          101,460        52,983       154,443
General and administrative                  84,466        70,787       155,253
Loan interest                              145,624           -         145,624
Professional fees                          127,160        17,388       144,548
Rent and occupancy costs                   127,602        42,118       169,720
Research and development expenditures      132,613           -         132,613
Salaries                                 1,654,513       829,020     2,483,533
Travel, entertainment and promotion        103,944        28,094       132,038
------------------------------------------------------------------------------

TOTAL EXPENSES                           2,696,660     1,126,917     3,823,577
------------------------------------------------------------------------------

NET INCOME (LOSS)                       (2,637,633)   (1,126,917)   (3,764,550)

MEMBERS' EQUITY (DEFICIT), BEGINNING    (1,126,917)            -             -
CONTRIBUTIONS - CASH                     1,825,000                   1,825,000
CONTRIBUTIONS - LOAN CONVERSIONS         2,209,907                   2,209,907
------------------------------------------------------------------------------

MEMBERS' EQUITY (DEFICIT), ENDING          270,357    (1,126,917)      270,357
------------------------------------------------------------------------------
</TABLE>

                                      F-16

<PAGE>

NEXVU TECHNOLOGIES, LLC
(A DEVELOPMENT STAGE ENTERPRISE)
STATEMENT OF CASH FLOWS

<TABLE>
<CAPTION>
                                                                                          FROM
                                                                                       INCEPTION
                                                                                        FEBRUARY
                                                            YEAR          PERIOD        28, 2002
                                                           ENDED           ENDED           TO
                                                          DECEMBER       DECEMBER       DECEMBER
                                                          31, 2003       31, 2002       31, 2003
-------------------------------------------------------------------------------------------------
<S>                                                     <C>            <C>            <C>

CASH FLOW FROM OPERATING ACTIVITIES

NET LOSS                                                $(2,637,633)   $(1,126,917)   $(3,764,550)
Adjustments to reconcile net loss to net cash
 used in operating activities
Depreciation and amortization                                84,395         39,075        122,796
Write off of organization costs                               3,371              -              -
Changes in assets and liabilities
 Increase in accounts receivable                            (51,680)        (9,590)       (61,270)
 Increase in prepaid expenses and sundry                    (51,837)             -        (51,837)
 Increase(decrease) in accounts payable                     (58,548)       219,519        158,409
-------------------------------------------------------------------------------------------------

                                                            (74,299)       249,004        168,098
-------------------------------------------------------------------------------------------------

Net Cash Used in Operating Activities                    (2,711,932)      (877,913)    (3,596,452)
-------------------------------------------------------------------------------------------------

CASH FLOW FROM FINANCING ACTIVITIES
 Loans payable - net                                      1,544,770      1,400,136      2,944,906
 Contributions by members - net of repayments             1,825,000            -        1,825,000
-------------------------------------------------------------------------------------------------
Net Cash Provided By Financing Activities                 3,369,770      1,400,136      4,769,906
-------------------------------------------------------------------------------------------------
</TABLE>

                                      F-17

<PAGE>

<TABLE>
<S>                                                     <C>            <C>            <C>
CASH FLOW FROM INVESTING ACTIVITIES
 Purchase of fixed assets                                   (40,958)      (218,178)      (259,136)
 Purchase of other assets                                         -       (304,045)      (300,000)
-------------------------------------------------------------------------------------------------

Net Cash Used In  Investing Activities                      (40,958)      (522,223)      (559,136)
-------------------------------------------------------------------------------------------------

Increase in Cash                                            616,880              -        614,318

Cash and Cash Equivalents - Beginning of Period                   -              -              -
-------------------------------------------------------------------------------------------------

Cash and Cash Equivalents - End of period               $   616,880    $         -    $   614,318
-------------------------------------------------------------------------------------------------

SUPPLEMENTAL CASH FLOW INFORMATION:
Cash paid for interest                                  $   107,175    $         -    $   107,175
                                                        -----------------------------------------
Cash paid for income taxes                              $         -    $         -    $         -
                                                        -----------------------------------------
NONCASH INVESTING AND FINANCING ACTIVITIES:
Contributions by members through conversions of loans   $ 2,209,907    $         -    $ 2,209,907
                                                        -----------------------------------------
</TABLE>

                                      F-18

<PAGE>

                             NEXVU TECHNOLOGIES, LLC
                         A DEVELOPMENT STAGE ENTERPRISE
                          NOTES TO FINANCIAL STATEMENTS
                           DECEMBER 31, 2002 AND 2003

NOTE 1 - Organization and Basis of Presentation

Nexvu Technologies, LLC, (the "Company") was organized as a Delaware limited
liability company on February 28, 2002 under the name of Siegler Technology
Development, LLC. The Company was formed to develop and market software and
hardware products and solutions for communication networks. The Company changed
its name to "Nexvu, LLC" on January 29, 2003, and to "Nexvu Technologies, LLC"
on October 22, 2003.

NOTE 2 - Summary of Significant Accounting Policies

Cash and Cash Equivalents

The Company considers those short-term, highly liquid investments with original
maturities of three months or less as cash and cash equivalents.

Property and Equipment

The Company capitalizes property and equipment in excess of $500. All property
and equipment are stated at cost. The cost of ordinary maintenance and repairs
is charged to operations while renewals and replacements are capitalized.
Depreciation is computed over the estimated useful lives of the assets generally
as follows:

            Computers, Equipment & Furniture            5 to 7 years
            Computer Software                           3 years

Software Licensing Fee

The Company accounts for its software license in accordance with Statement of
Financial Accounting Standards ("SFAS") No. 142, effective October 1, 2001. The
Company also reviews its long-lived assets for impairments. Impairment losses on
long-lived assets are recognized when events or changes in circumstances
indicate that the undiscounted cash flows estimated to be generated by such
assets are less than their carrying value and, accordingly, all or a portion of
such carrying value may not be recoverable. Impairment losses are then measured
by comparing the fair value of assets to their carrying amounts. The Company
recognized no impairment loss at December 31, 2002 and 2003.

Fair Value of Financial Instruments

The carrying amount of cash, accounts receivable, prepaid expenses and accounts
payable are considered representative of their respective fair values because of
the short-term nature of these financial instruments.

                                      F-19

<PAGE>

Revenue Recognition

The Company has not generated any significant revenues through December 31,
2003. Revenues, if any, will be recognized when the price is reasonably
determinable, the product or service has been delivered and collection of the
sales price is reasonably assured.

Income Taxes

The Company is organized as a limited liability company. All profits or losses
or benefits derived are the responsibility of the members. Neither income taxes
nor the benefits relating to net losses are reflected in the accompanying
financial statements.

Use of Estimates

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

Recently Issued Accounting Pronouncements

SFAS No. 149 "Amendment of Statement 133 on derivative instruments and hedging
activities". This statement amends and clarifies financial accounting and
reporting for derivative instruments embedded in other contracts (collectively
referred to as derivatives) and for hedging activities under SFAS 133,
"Accounting for derivative instruments and hedging activities".

SFAS No. 150 "Accounting for certain financial instruments with characteristics
of both liabilities and equity". This statement establishes standards for how an
issuer classifies and measures certain financial instruments with
characteristics of both liabilities and equity.

The Company believes that the above standards would not have a material impact
on its financial position, results of operations or cash flows.

NOTE 3 - Going Concern

The accompanying financial statements have been prepared assuming that the
Company will continue as a going concern. This basis of accounting contemplates
the recovery of the Company's assets and the satisfaction of its liabilities in
the normal course of business. Through December 31, 2003, the Company had
incurred cumulative losses of $3,764,550. The Company's successful transition
from a development stage company to attaining profitable operations is dependent
upon obtaining financing adequate to achieving a level of revenues adequate to
support the Company's cost structure. Subsequent to the date of these financial
statements the Company has received a total of $7,625,075 in gross proceeds from
a private placement offering and an additional $550,000 in bridge loans have
been converted into common stock. See Note 9, Subsequent Events.

                                      F-20

<PAGE>

NOTE 4 - Software License Agreement

On August 31, 2003, the Company entered into a software licensing agreement with
a third party company to acquire a non-exclusive license for the worldwide
rights to market and distribute the proprietary software. The term of the
agreement is for five years with provision for annual renewals thereafter. The
cost of the software licensing fee was $300,000 with annual upgrade and
maintenance charges of $30,000. The agreement also calls for minimum annual
royalty payments totaling $500,000 over the first five year period following
customer shipment, payable quarterly as follows:

<TABLE>
<S>               <C>
Year 1            $  50,000
Year 2               75,000
Year 3              100,000
Year 4              125,000
Year 5              150,000
</TABLE>

If in any year the calculation of the royalty fee is greater than the minimum,
this excess will reduce the final amount due in the fifth year.

NOTE 5 - Commitments

In July, 2002, the Company entered into a three year operating lease agreement
for office space. Minimum rentals, on an annual basis, are as follows:

<TABLE>
<S>               <C>
2004              $76,265
2005               78,220
</TABLE>

NOTE 6 - Notes Payable

<TABLE>
<S>                                                          <C>
Notes payable to members, unsecured, interest at 8%,
convertible to equity according to the terms of the Loan
Conversion Agreement                                         $625,000

Note payable to bank, secured by certain personal assets
of a member and all assets of the Company, interest at 9%,
interest only due monthly, principal due March 31, 2004       110,000
                                                             --------

Total Notes Payable                                          $735,000
                                                             ========
</TABLE>

                                      F-21

<PAGE>

NOTE 7 - Property and Equipment

Property and equipment at December 31, 2003 consists of the following:

Furniture and fixtures           $  89,375
Software                            19,408
Computer equipment                 128,491
Office equipment                     3,629
Telephone equipment                 18,236
                                 ---------
                                   259,139
Less: Accumulated depreciation    (122,798)
                                 ---------
                                 $ 136,341
                                 =========

NOTE 8 - Related Parties

On December 1, 2003, the Company entered into an agreement for business and
financial advisory services to be provided by an entity controlled by one of the
Company's directors. Fees for these services total $765,000.

NOTE 9 - Subsequent Events

On January 28, 2004, the Company merged with a wholly owned subsidiary of
Capital Growth Systems, Inc. ("CGSI"), a Florida "shell" corporation formed for
the purpose of acquiring an operating business. The Company has become the sole
operating business of CGSI. The merger was contingent upon CGSI having raised a
minimum of $2,000,000 of investor capital pursuant to a common stock private
placement at $1.35 per share. As of April 15, 2004 an aggregate of $7,625,075 of
gross proceeds from the private placement had been raised. In addition, at the
merger closing the $550,000 of bridge loans to the Company were converted into
additional common stock of CGSI at approximately $0.95 per share and one
additional $25,000 subscription was accepted shortly thereafter at such pricing.
In connection with the merger, an aggregate of 8,558,500 shares of common stock
of CGSI were issued to the members of the Company and the Company became a
wholly owned subsidiary of CGSI, with CGSI serving as its sole manager.
Following the merger the Company will be treated as a disregarded entity for
state and federal income tax purposes. The cash balances of CGSI as of March 1,
2004 are expected to be more than sufficient to cover the cost of operations of
the Company for 2004.

                                      F-22

<PAGE>

EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit Number                               Description of Document
--------------  -----------------------------------------------------------------------------------
<S>             <C>
    4.2         Form of Warrant to Purchase common stock of Capital Growth Systems, Inc. for bridge
                lenders.

    4.3         Form of Warrant to Purchase common stock of Capital Growth Systems, Inc. for Advisory
                Service Agreements.

    4.4         Form of Warrant to Purchase common stock of Capital Growth Systems, Inc. for selling
                shareholder.

    4.5         2003 Long-Term Incentive Plan.

    10.3        Second Amended and Restated Operating Agreement of Nexvu Technologies, LLC.

    10.4        Advisory Services Agreement dated March 31, 2004 by and between Capital Growth
                Systems, Inc. and Lee Wiskowski.

    10.5        Advisory Services Agreement dated March 31, 2004 by and between Capital Growth
                Systems, Inc. and Douglas Stukel.

    10.6        Employment Agreement dated April 26, 2004 by and between Capital Growth Systems, Inc.
                and Scott Allen.

    10.7        Employment Agreement dated April 26, 2004 by and between Capital Growth Systems, Inc.
                and Rory Herriman.

    14          Code of Ethics.

    21          List of Subsidiaries.

    31.1        Certification of CEO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

    31.2        Certification of CFO Pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

    32          Certification Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section 906
                of the Sarbanes-Oxley Act of 2002.
</TABLE>